Grundstücksgemeinschaft Busley and Cibrian Fernandez v Finanzamt Stuttgart-Körperschaften.
Date: 2009-10-15
17. In that regard, the Court has consistently held that, in the absence of a definition in the Treaty of ‘movement of capital’ within the meaning of Article 56(1) EC, the nomenclature which constitutes Annex I to Directive 88/361 retains an indicative value, even though that directive was adopted on the basis of Articles 69 and 70(1) of the EEC Treaty (after amendment, Articles 69 and 70(1) of the EC Treaty, repealed by the Treaty of Amsterdam), it being understood that, according to the third paragraph of the introduction to that annex, the nomenclature which it contains is not exhaustive as regards the notion of ‘movement of capital’ (see, inter alia, Case C‑386/04 Centro di Musicologia Walter Stauffer  [2006] ECR I‑8203, paragraph 22 and case-law cited, and Case C‑67/08 Block  [2009] ECR I‑0000, paragraph 19).
18. The Court – noting, in particular, that inheritances consisting in the transfer to one or more persons of assets left by a deceased person come under heading XI of Annex I to Directive 88/361, entitled ‘Personal capital movements’ – has held that an inheritance, including one of immovable property, is a movement of capital for the purposes of Article 56 EC, except in cases where its constituent elements are confined within a single Member State (see, inter alia, Case C‑513/03 van Hilten-van der Heijden  [2006] ECR I‑1957, paragraphs 40 to 42; Case C‑43/07 Arens-Sikken  [2008] ECR I‑6887, paragraph 30; Case C‑318/07 Persche  [2009] ECR I‑0000, paragraphs 26 and 27; and Block , paragraph 20).
19. Consequently, a situation in which natural persons residing in Germany and liable to unlimited taxation in that Member State inherit a house situated in Spain is one that is covered by Article 56 EC. It is therefore not necessary to consider whether Articles 39 EC and 43 EC apply, as argued by the applicants in the main proceedings.
20. With regard to the existence of restrictions on the movement of capital within the meaning of Article 56(1) EC, it should be noted that the measures prohibited by that provision include those which are likely to discourage non-residents from making investments in a Member State or to discourage that Member State’s residents from doing so in other States (see Case C‑370/05 Festersen  [2007] ECR I‑1129, paragraph 24; Case C‑101/05 A  [2007] ECR I‑11531, paragraph 40; and Case C‑377/07 STEKO Industriemontage  [2009] ECR I‑0000, paragraph 23).
21. It is not only national measures liable to prevent or limit the acquisition of an immovable property situated in another Member State which may be deemed to constitute such restrictions, but also those which are liable to discourage the retention of such a property (see, by way of analogy, STEKO Industriemontage , paragraph 24 and case-law cited).
25. Nevertheless, the fact remains that, even on the assumption that the taxable person in question retains such property for a sufficient period of time for all losses to be offset against subsequent positive income and for the acquisition or construction costs of that property to be written down in full, that person – unlike a taxable person resident in Germany who has invested in a property there – is not entitled to have those losses taken into account immediately or to an initially higher rate of depreciation, and is thus deprived of a cash-flow advantage, as has been pointed out by the Commission of the European Communities (see, by way of analogy, Case C‑446/04 Test Claimants in the FII Group Litigation  [2006] ECR I‑11753, paragraphs 84 and 153, and Case C‑347/04 Rewe Zentralfinanz  [2007] ECR I‑2647, paragraph 29).
28. Nevertheless, it is necessary to consider whether those restrictions are justified – as the Finanzamt and the German Government maintain – and may thus be accepted on condition that they are appropriate for securing the attainment of the objective pursued and do not go beyond what is necessary in order to attain it (see, to that effect, Case C‑451/05 ELISA  [2007] ECR I‑8251, paragraph 79; Case C‑152/05 Commission  v Germany  [2008] ECR I‑39, paragraph 26; and Case C‑110/05 Commission  v Italy  [2009] ECR I‑0000, paragraph 59).
29. In regard to point 6(a) of the first sentence of Paragraph 2a(1) of the EStG, the Finanzamt contends that that provision is consistent with the principle of territoriality, as the Court accepted in paragraph 22 of its judgment in Case C‑250/95 Futura Participations and Singer  [1997] ECR I‑2471.
30. However, that principle, the purpose of which is to establish, in the application of Community law, the need to take into account the limits on the Member States’ powers of taxation, does not preclude the taking into account by a person liable to unlimited taxation in a Member State of negative income from an immovable property situated in another State (see, by way of analogy, Rewe Zentralfinanz , paragraph 69). Consequently, that provision – by virtue of which the applicants in the main proceedings, who are liable to unlimited taxation in Germany, are unable to take into account losses from their house in Spain – cannot be considered as an implementation of the principle of territoriality.