CELEX: C2003/184/36
Language: en
Date: 2003-08-02 00:00:00
Title: Case C-224/03: Action brought on 22 May 2003 by the Italian Republic against the Commission of the European Communities

C 184/20                EN                         Official Journal of the European Union                                          2.8.2003
Action brought on 19 May 2003 by the Commission of the                           from investing their capital in shares quoted on markets
   European Communities against the Kingdom of Spain                             other than Spanish regulated markets; moreover, it is
                                                                                 probably the case that such legislation prevents those
                                                                                 undertakings whose shares are quoted in such markets
                           (Case C-219/03)                                       from raising capital in Spain. Furthermore, the differen-
                                                                                 tiated treatment affects the conduct of undertakings which
                                                                                 issue shares, in particular because Spanish undertakings,
                           (2003/C 184/35)                                       which are more likely to have shareholders who are liable
                                                                                 to Spanish income tax, are encouraged to see to it that
                                                                                 their shares are quoted on a Spanish regulated market so
                                                                                 that their shareholders may benefit from a more favour-
An action against the Kingdom of Spain was brought before                        able tax regime.
the Court of Justice of the European Communities on 19 May
2003 by the Commission of the European Communities,
represented by M. Díaz-Llanos La Roche and L. Escobar Guer-                Moreover, the Spanish legislation in issue also constitutes an
rero, with an address for service in Luxembourg.                           obstacle to the freedom to provide services, guaranteed under
                                                                           Article 49 EC and Article 36 of the EEA Agreement, inasmuch
                                                                           as it hinders markets other than Spanish regulated markets
The applicant claims that the Court should:
                                                                           from providing services to Spanish undertakings by creating a
                                                                           split in the European market in services provided by the stock
1.    Declare that, with regard to the tax on capital gains made           markets and exchanges, creating a captive market which
      on transfers since 1 January 1997 of shares purchased                favours Spanish regulated markets. Under those circumstances,
      prior to 31 December 1994, the Kingdom of Spain has                  such undertakings are not free to choose another European
      failed to fulfil its obligations under Articles 49 and 56 of         market from among those which offer a better service.
      the EC Treaty and the corresponding Articles 36 and 40
      of the EEA Agreement inasmuch as it established a tax
      regime which is less favourable to shares quoted in
      markets other than Spanish regulated markets; and
2.    Order the Kingdom of Spain to pay the costs.
                                                                           Action brought on 22 May 2003 by the Italian Republic
                                                                             against the Commission of the European Communities
Pleas in law and main arguments
The Commission is of the view that Spanish legislation                                              (Case C-224/03)
concerning income tax on natural persons is incompatible
with Community law and constitutes an obstacle to the free
movement of capital and the freedom to provide services so                                          (2003/C 184/36)
far as concerns tax on capital gains made on transfers since
1 January 1997 of shares purchased prior to 31 December
1994. Such legislation establishes for Spanish regulated markets
a more favourable tax regime than that applicable to shares
quoted on other markets:                                                   An action against the Commission of the European Commu-
                                                                           nities was brought before the Court of Justice of the European
                                                                           Communities on 22 May 2003, by the Italian Republic,
when determining the reduction of the amount of the taxable                represented by Ivo Maria Braguglia, acting as Agent, assisted
capital gain, a higher weighting is applied to shares quoted on            by State Advocate, Maurizio Fiorilli.
Spanish regulated markets than to shares quoted on other
markets (25 % as compared to 14,28 %). The latter are there-
fore subjected to a more onerous tax burden.                               The applicant claims that the Court should:
—     in order not to be liable to tax, shares quoted on markets
                                                                           —     Declare that, under Article 97 of the Treaty establishing
      other than Spanish regulated markets must have been
                                                                                 the European Coal and Steel Community, with effect from
      owned by their proprietor for longer (eight years instead
                                                                                 24 July 2002 the powers and competence of the
      of five).
                                                                                 Commission of the European Communities established
                                                                                 by Article 9 of the Treaty of 8 April 1965 (Merger Treaty)
—     The Spanish legislation is thus contrary to Article 56 EC                  — in the sectors assigned under the ECSC Treaty to the
      and Article 40 of the Agreement on the European                            High Authority of the ECSC — have lapsed, with the
      Economic Area (EEA) inasmuch as it constitutes an                          result that any measure adopted or to be adopted by it in
      obstacle to the free movement of capital. By establishing                  those sectors which have not formed the subject-matter of
      a less-favourable tax treatment, the Spanish legislation                   a new agreement by the signatory states, is to be deemed
      appears to deter natural persons liable to income tax                      null and void and of no effect.
 ---pagebreak--- 2.8.2003              EN                        Official Journal of the European Union                                          C 184/21
Pleas in law and new arguments                                          vehicle registered abroad. They require payment of the car tax
                                                                        chargeable in Finland before the vehicle may be used. Car tax
In general terms, for the provisions of an international treaty         is to be levied on vehicles which are used in traffic in Finland,
to be able to continue to have effect after its natural expiry a        even to a small extent, unless a specific exception is laid down
decision in that behalf must be taken in concertation by the            by law.
signatory States and only by them.
No joint position was adopted by the signatory States of the            Under the Finnish provisions, car tax is to be paid on a vehicle
ECSC Treaty, prior to the expiry thereof, with a view to                before it is used on Finnish territory. If the vehicle is never-
extending its validity in its entirety and to providing for a           theless used without paying tax in cases in which tax should
general transitional regime to ensure the continuance in effect         have been regarded as paid, the authorities levy tax on the
of all its provisions. Instead the signatory States allowed the         vehicle.
ECSC Treaty to be extinguished, merely regulating the transfer
of ECSC provisions to the EC regime in regard to certain
sectors. In particular, no joint provision was made in regard           The Finnish legislation, contrary to Article 39 EC, prevents the
to a transitional regime in competition matters under the ECSC          realisation of freedom of movement of workers, because
Treaty. In the case of investigations under way at the time of          employees living in Finland cannot use a car provided by their
expiry of the ECSC Treaty such expiry could not be claimed to           employer and registered in another Member State for their
be ‘non-retroactive’ since that would entail the continuance in         work in Finland, if tax is not paid on the car in Finland. As
effect of its provisions, no right, obligation or legal situation       a result of the Finnish legislation, employees resident in Finland
arising during the currency of the Treaty itself.                       cannot accept an offer of work from a neighbouring State of
                                                                        the European Union where the use in both countries of a car
From the applicant's point of view, absorption of the ECSC              provided by the employer is part of the work.
rules within the EC rules may occur only by way of an
instrument manifesting the common will in that regard of the
signatory states.                                                       Companies operating in another Member State cannot engage
                                                                        employees living in Finland because they cannot use a car
                                                                        registered in another country in Finland if Finnish tax has not
                                                                        been paid on the car. The practice discriminates in particular
                                                                        against cross-frontier workers living in Finland, who cannot
                                                                        use a car provided by the employer for daily work journeys
                                                                        between the home and the workplace. The use of a car
                                                                        provided by the employer is often a regular part of the
Action brought on 28 May 2003 by the Commission of                      remuneration. A Member State breaches the duty of coopera-
the European Communities against the Republic of                        tion under Article 10 EC if the national measures of the
                             Finland                                    Member State prevent freedom of movement in such a way
                                                                        that workers living in another Member State cannot pursue
                         (Case C-232/03)                                their occupation in the other Member State.
                         (2003/C 184/37)
An action against the Republic of Finland was brought before
the Court of Justice of the European Communities on 28 May
2003 by the Commission of the European Communities,
represented by D. Martin and I. Koskinen, acting as Agents,
with an address for service in Luxembourg.
                                                                        Reference for a preliminary ruling by the Audiencia
The Commission claims that the Court should:                            Nacional by order of that Court of 16 April 2003 in the
                                                                        case of Contse S.A., Vivisol SRL and Oxigen Salud S.A.
1.    Declare that, by preventing cross-frontier workers from                          against INSALUD (now INGESA)
      benefiting from certain benefits provided to them by their
      employers on the sole ground that the workers in ques-
      tion live in the Republic of Finland, into which the                                       (Case C-234/03)
      vehicles owned by their employers have been imported,
      the Republic of Finland has failed to fulfil its obligations
      under Articles 10 EC and 39 EC;                                                            (2003/C 184/38)
2.    Order Finland to pay the costs.
                                                                        Reference has been made to the Court of Justice of the
                                                                        European Communities by order of the Audiencia Nacional
Pleas in law and main arguments                                         (National High Court) of 16 April 2003, received at the Court
                                                                        Registry on 2 June 2003, for a preliminary ruling in the case
Provisions of Finnish legislation limit the possibility for a           of Contse S.A., Vivisol SRL and Oxigen Salud S.A. against
person permanently resident in Finland to use in Finland a              INSALUD (now INGESA) on the following questions: