CELEX: C2006/331/05
Language: en
Date: 2006-12-30 00:00:00
Title: Case C-374/04: Judgment of the Court (Grand Chamber) of 12 December 2006 (reference for a preliminary ruling from the High Court of Justice of England and Wales, Chancery Division, United Kingdom) — Test Claimants in Class IV of the ACT Group Litigation v Commissioners of Inland Revenue (Freedom of establishment — Free movement of capital — Corporation tax — Payment of dividends — Tax credit — Separate treatment of resident and non-resident shareholders — Bilateral double taxation conventions)

30.12.2006   
            
            
               EN
            
            
               Official Journal of the European Union
            
            
               C 331/3
            
         Judgment of the Court (Grand Chamber) of 12 December 2006 (reference for a preliminary ruling from the High Court of Justice of England and Wales, Chancery Division, United Kingdom) — Test Claimants in Class IV of the ACT Group Litigation v Commissioners of Inland Revenue
   (Case C-374/04) (1)
   
   (Freedom of establishment - Free movement of capital - Corporation tax - Payment of dividends - Tax credit - Separate treatment of resident and non-resident shareholders - Bilateral double taxation conventions)
   (2006/C 331/05)
   Language of the case: English
   Referring court
   High Court of Justice of England and Wales, Chancery Division
   Parties to the main proceedings
   
      Applicants: Test Claimants in Class IV of the ACT Group Litigation
   
      Defendant: Commissioners of Inland Revenue
   Re:
   Reference for a preliminary ruling — High Court of Justice of England and Wales, Chancery Division — National legislation on corporation tax — Retention at source (‘advance corporation tax’) applied to the profits distributed by a subsidiary to a parent company — Tax credit designed to take account of a retention made upstream — Benefit of the tax credit limited to residents and to residents of certain other Member States party to a convention for avoiding double taxation containing a clause to that effect — Liability of a Member State for breach of Community law — Form of redress
   Operative part of the judgment
   
               1.
            
            
               Articles 43 EC and 56 EC do not prevent a Member State, on a distribution of dividends by a company resident in that State, from granting companies receiving those dividends which are also resident in that State a tax credit equal to the fraction of the corporation tax paid on the distributed profits by the company making the distribution, when it does not grant such a tax credit to companies receiving such dividends which are resident in another Member State and are not subject to tax on dividends in the first State;
            
         
               2.
            
            
               Articles 43 EC and 56 EC do not preclude a situation in which a Member State does not extend the entitlement to a tax credit provided for in a double taxation convention concluded with another Member State for companies resident in the second State which receive dividends from a company resident in the first State to companies resident in a third Member State with which it has concluded a double taxation convention which does not provide for such an entitlement for companies resident in that third State.
            
         
      (1)  OJ C 273, 6.11.2004.