Verder LabTec GmbH & Co. KG v Finanzamt Hilden.
Date: 2015-05-21
29. In that regard, it should be noted that, according to settled case-law, questions on the interpretation of European Union law referred by a national court in the factual and legislative context which that court is responsible for defining, and the accuracy of which is not a matter for the Court to determine, enjoy a presumption of relevance. The Court may refuse to rule on a question referred by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (judgment in Stanley International Betting and Stanleybet Malta , C‑463/13, EU:C:2015:25, paragraph 26 and the case-law cited).
32. It should be borne in mind that Article 49 TFEU requires the elimination of restrictions on freedom of establishment. That freedom includes, for companies established in accordance with the legislation of a Member State and having their registered office, central administration or principal place of business within the European Union, the right to exercise their activity in other Member States through a subsidiary, branch or agency (judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 54 and the case-law cited).
33. Although, according to their wording, the provisions of the FEU Treaty on freedom of establishment are aimed at ensuring the benefit of national treatment in the host Member State, they also prohibit the Member State of origin from hindering the establishment in another Member State of one of its nationals or of a company incorporated in accordance with its legislation (judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 56 and the case-law cited).
34. Furthermore, it is settled case-law that all measures which prohibit, impede or render less attractive the exercise of freedom of establishment must be considered to be restrictions on that freedom (judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 56 and the case-law cited).
35. In that regard, freedom of establishment is applicable to the transfer of activities of a company in the territory of a Member State to another Member State, irrespective of whether the company in question transfers its registered office and its effective management outside that territory or whether it transfers assets of a permanent establishment located within that territory to another Member State (judgment in Commission  v Denmark , C‑261/11, EU:C:2013:480, paragraph 28 and the case-law cited).
36. As regards the taxation of unrealised capital gains, generated within the tax jurisdiction of a Member State, relating to the assets transferred to a permanent establishment located within another Member State, if the first Member State loses its right to tax income generated by those assets at the time of that transfer, it is clear, in essence, from the case‑law of the Court, that tax legislation of a Member State which results in the immediate taxation of those capital gains in the event of such a transfer, whereas they are not taxed on a similar transfer within the national territory, is likely to deter a company established in the first Member State from transferring its assets from the territory of that State to another and, therefore, constitutes a restriction on freedom of establishment (see, to that effect, Commission  v Denmark , C‑261/11, EU:C:2013:480, paragraphs 29 to 31 and the case-law cited).
38. Such a difference in treatment cannot be explained by an objective difference in situation. Under legislation of a Member State which seeks to tax unrealised capital gains generated within its territory, the situation of a company which transfers assets to a permanent establishment located in another Member State is, as regards the taxation of the capital gains related to those transferred assets which were generated in the former Member State prior to that transfer, comparable to that of a company which makes a similar transfer to a permanent establishment located within the territory of that Member State (see, to that effect, judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 60).
42. In that regard it should be borne in mind, first, that the preservation of the balanced allocation of powers of taxation between Member States is a legitimate objective recognised by the Court, and that, in the absence of any unifying or harmonising measures of the European Union, the Member States retain the power to define, by treaty or unilaterally, the criteria for allocating their powers of taxation, with a view to eliminating double taxation (judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 64 and the case‑law cited).
43. Second, according to the fiscal principle of territoriality, a Member State is entitled, in the case of a transfer of assets to a permanent establishment located within another Member State, to impose tax, at the time of the transfer, on the capital gains generated on its territory prior to that transfer. Such a measure is intended to prevent situations capable of jeopardising the right of the Member State of origin to exercise its powers of taxation in relation to activities carried on in its territory (see, to that effect, judgment in National Grid Indus , C‑371/10, EU:C:2011:785, paragraphs 45 and 46 and the case-law cited).
44. Accordingly, the transfer of the assets at issue in the main proceedings from the Federal Republic of Germany to another Member State cannot mean that the former State must waive its right to tax the capital gains generated within its tax jurisdiction prior to the transfer of those capital gains outside its territory.
45. Besides, Member States entitled to tax capital gains generated when the assets in question were on their territory have the power, for the purposes of such taxation, to make provision for a chargeable event other than the actual realisation of those gains, in order to ensure that those assets are taxed (judgment in DMC , C‑164/12, EU:C:2014:20, paragraph 53 and the case-law cited).
48. As regards the proportionality of the legislation at issue in the main proceedings, it should be noted, at the outset, that it is proportionate for a Member State, for the purpose of safeguarding the exercise of its powers of taxation, to determine the amount of the tax due on the unrealised capital gains that have been generated in its territory pertaining to the assets transferred outside its territory, at the time when its powers of taxation in respect of the assets concerned cease to exist, namely, in the present case, at the time of the transfer of the assets at issue outside the territory of that Member State (see, to that effect, judgments in Commission  v Spain , C‑64/11, EU:C:2013:264, paragraph 31, and DMC , C‑164/12, EU:C:2014:20, paragraph 60 and the case-law cited).
49. As regards the recovery of such a tax, the Court has held that it was appropriate to give the taxable person the choice between, on the one hand, immediate payment of that tax, and, on the other hand, deferred payment of that tax, together with, if appropriate, interest in accordance with the applicable national legislation (judgment in Commission  v Germany , C‑591/13, EU:C:2015:230, paragraph 67 and the case-law cited).
50. In that context, the Court further held that account should also be taken of the risk of non-recovery of the tax, which increases with the passage of time, which may be taken into account by the Member State in question, in its national legislation applicable to deferred payment of tax liabilities (see, to that effect, National Grid Indus , C‑371/10, EU:C:2011:785, paragraph 74).
52. In that regard, suffice it to note that recovery of tax on unrealised capital gains spread over five annual instalments, instead of immediate recovery, was considered to be a proportionate measure to attain that objective (judgment in DMC, C‑164/12, EU:C:2014:20, paragraph 64). A staggered recovery of tax on unrealised capital gains over 10 annual instalments, such as that at issue in the main proceedings, can only therefore be considered, as the Advocate General has observed in points 72 and 73 of his Opinion, as a proportionate measure to attain that objective.