Commission of the European Communities v Hellenic Republic.
Date: 2007-06-07
25. A preliminary point to note is that, under the first paragraph of Article 10 EC, the Member States are to take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of the EC Treaty or resulting from action taken by the institutions of the Community. Such action includes directives which, pursuant to the third paragraph of Article 249 EC, are binding as to the result to be achieved upon each Member State to which they are addressed. This obligation involves adopting, within the framework of the national legal system, all the measures necessary to ensure that a directive is fully effective, in accordance with the objective which it pursues (see, in particular, Case C-336/97 Commission  v Italy  [1999] ECR I‑3771, paragraph 19, and the judgment of 10 March 2005 in Case C-531/03 Commission  v Germany , not published in the ECR, paragraph 16).
26. It is clear from Article 4(1)(g) and (h) of Directive 69/335 that capital duty is chargeable on transfers, from a Member State to another Member State, of the effective centre of management or registered office of companies, firms, associations or legal persons which are considered in the latter Member State, for the purposes of charging capital duty, to be capital companies, but are not so considered in the former Member State.
27. Those provisions do not therefore provide for capital duty to be charged on transfers of the effective centre of management or registered office of companies, firms, associations or legal persons which are considered, for the purposes of charging capital duty, to be ‘capital companies’ in both the Member States concerned.
28. Article 4(3)(b) of Directive 69/335 makes it clear that such transfers cannot be subject to capital duty under Article 4(1)(a) either.
29. However, as the Greek Government itself acknowledges, the criterion of being ‘subject to’ duty that is used in the transfer rules at issue can result in capital duty being charged in Greece even if the company concerned is also considered as a ‘capital company’ in the Member State of origin. That is so in particular where the latter State exempts all transactions pursuant to Article 7(2) of Directive 69/335 or where it applies a nil rate.
30. Therefore, the criterion of being ‘subject to’ duty used in the transfer rules at issue does not correspond to the ‘capital company’ criterion prescribed in Article 4(1)(g) and (h) and (3)(b) of Directive 69/335. On the contrary, it allows capital duty to be charged in cases where Directive 69/335 does not so envisage.
31. Since Directive 69/335 harmonises exhaustively the cases in which the Member States may impose capital duty, the transfer rules in question must therefore be regarded as transposing Article 4(1)(g) and (h) and (3)(b) of the directive incorrectly.
32. This finding cannot be affected by the argument put forward by the Kingdom of Spain that the criterion of being ‘subject to’ duty is necessary in order to prevent tax avoidance. In so far as Directive 69/335 harmonises exhaustively the cases in which the Member States may impose capital duty and does not contain any provision expressly authorising the Member States to take general measures to prevent tax avoidance, the Member States can prevent the application of Community law only in specific circumstances entailing an abusive or fraudulent practice. The application of Community legislation cannot be extended to cover abusive practices by economic operators, that is to say transactions carried out not in the context of normal commercial operations, but solely for the purpose of wrongfully obtaining advantages provided for by Community law (see to this effect, in particular, Case C-255/02 Halifax and Others  [2006] ECR I-1609, paragraph 69, and the case-law cited). In the present case however, first, the transfer rules at issue are not limited to combating abuse in a particular case. Second, exercise of a right created by Community law, such as establishment of a company in another Member State or transfer of its effective centre of management or registered office, cannot in itself warrant suspicion of abuse.
33. Furthermore, inasmuch as the Hellenic Republic acknowledges that the distinction between ‘actual taxation’ and being ‘subject to’ duty was not clearly made in the transfer rules at issue and may have led to a degree of confusion, it should be added that, in any event, such rules do not satisfy the requirements established by the case-law concerning transposition of directives. According to that case-law, it is particularly important, in order to satisfy the requirement for legal certainty, that individuals should have the benefit of a clear and precise legal situation enabling them to ascertain the full extent of their rights and, where appropriate, to rely on them before the national courts (see to this effect, in particular, Case C-236/95 Commission  v Greece  [1996] ECR I-4459, paragraph 13, and Case C-177/04 Commission  v France  [2006] ECR I‑2461, paragraph 48). The rules cannot be regarded as establishing a clear and precise legal situation of that kind.
43. This interpretation is borne out by the objective of that provision, which is to prevent the choice of a particular legal form from resulting in the different fiscal treatment of transactions which, from an economic point of view, are equivalent. Article 3(2) of Directive 69/335 is intended to apply, with a view to the charging of capital duty, to companies, firms, associations or legal persons which, while having the same economic function as capital companies properly so called, namely the earning of a profit by the pooling of capital in a separate set of assets, do not satisfy the criteria to be a ‘capital company’ as defined in Article 3(1) (see, to this effect, Case 112/86 Amro Aandelen Fonds  [1987] ECR 4453, paragraphs 10 and 11).
44. Article 3(2) of Directive 69/335 leaves Member States free, however, to limit the scope of the deeming clause that it contains, by allowing them to exempt certain categories of deemed capital companies from liability to capital duty (see, to this effect, Case 270/81 Felicitas Rickmers-Linie  [1982] ECR 2771, paragraph 3, and Amro Aandelen Fonds , paragraph 12).
52. Far from excluding the application of the Treaty to sea transport, Article 80(2) EC provides only that the specific provisions of the Treaty relating to the common transport policy, which are set out in Title V of Part Three of the Treaty, will not automatically apply to that sphere of activity. Whilst under that provision, therefore, sea transport is excluded from the rules of Title V so long as the Council has not decided otherwise, it remains, like other modes of transport, subject to the general rules of the Treaty. It follows that the application of Directive 69/335 to the sphere of sea transport is not optional but obligatory for Member States (see Case 167/73 Commission  v France  [1974] ECR 359, paragraphs 30 to 33). Contrary to the Hellenic Republic’s submissions, Directive 69/335 therefore also applies to capital companies in the maritime sector.
54. In order to define ‘capital company’ for the purposes of Directive 69/335, Article 3(1) refers, first, to the Ανώνυμος Εταιρία (public limited company), Ετερόρρυθμος κατά μετοχάς Εταιρία (limited partnership with shares) and Εταιρία Περιωρισμένης Ευθύνης (private limited company) and, second, to the ability to deal in the shares on a stock exchange (Article 3(1)(b)) and the freedom to dispose of them where they represent the shareholder’s liability (Article 3(1)(c)) (see, to this effect, Amro Aandelen Fonds , paragraph 8).
67. As to those submissions, even if judgments delivered under Article 226 EC were to have the same effects as those delivered under Article 234 EC and, therefore, considerations of legal certainty might make it necessary to limit their temporal effects (see Case C‑359/97 Commission  v United Kingdom  [2000] ECR I‑6355, paragraph 92) provided that the conditions laid down by the Court’s case-law in the context of Article 234 EC are met (see, in particular, Case C-402/03 Skov and Bilka  [2006] ECR I‑199, paragraph 51), it need merely be stated that in the present case the Hellenic Republic is not justified in claiming that a risk of serious economic repercussions within the meaning of that case-law exists.