CELEX: C2006/131/35
Language: en
Date: 2006-06-03 00:00:00
Title: Case C-471/04: Judgment of the Court (First Chamber) of  23 February 2006  (reference for a preliminary ruling from the Bundesfinanzhof) — Finanzamt Offenbach am Main-Land v Keller Holding GmbH (Freedom of establishment — Corporation tax — Right of a parent company to deduct costs relating to its shareholdings — Non-deductible financing costs having an economic link with dividends exempt from tax — Dividends distributed by an indirect subsidiary established in a Member State other than that in which the parent company has its seat)

3.6.2006   
            
            
               EN
            
            
               Official Journal of the European Union
            
            
               C 131/20
            
         Judgment of the Court (First Chamber) of 23 February 2006 (reference for a preliminary ruling from the Bundesfinanzhof) — Finanzamt Offenbach am Main-Land v Keller Holding GmbH
   (Case C-471/04) (1)
   
   (Freedom of establishment - Corporation tax - Right of a parent company to deduct costs relating to its shareholdings - Non-deductible financing costs having an economic link with dividends exempt from tax - Dividends distributed by an indirect subsidiary established in a Member State other than that in which the parent company has its seat)
   (2006/C 131/35)
   Language of the case: German
   Referring court
   Bundesfinanzhof
   Parties to the main proceedings
   
      Applicant: Finanzamt Offenbach am Main-Land
   
      Defendant: Keller Holding GmbH
   Re:
   Preliminary ruling — Bundesfinanzhof — Interpretation of Article 52 of the EC Treaty (now, after amendment, Article 43 EC), Article 58 and Article 73b of the EC Treaty (now Article 48EC and 56 EC) — Corporation tax — Non-deductibility of expenditure having a direct economic link to tax-free profits — Expenditure incurred by a parent company established in a Member State linked to its shareholding in a subsidiary established in the same Member State, in connection with dividends distributed by a second-tier subsidiary which are exempted from tax by virtue of the fact that this latter company is established in another Member State
   Operative part of the judgment
   Article 52 of the EC Treaty (now, after amendment, Article 43 EC) and Article 31 of the Agreement on the European Economic Area of 2 May 1992 must be interpreted as precluding legislation of a Member State which excludes the possibility of deducting for tax purposes financing costs incurred by a parent company subject to unlimited tax liability in that State in order to acquire holdings in a subsidiary where those costs relate to dividends which are exempt from tax because they are derived from an indirect subsidiary established in another Member State or in a State which is party to the Agreement, whereas such costs may be deducted where they relate to dividends paid by an indirect subsidiary established in the same Member State as that of the place of the registered office of the parent company and which, in reality, also benefit from a tax exemption.
   
      (1)  OJ C 19, 22.01.2005.