Euro Park Service v Ministre des finances et des comptes publics.
Date: 2017-03-08
19


In accordance with settled case-law, any national measure in an area which has been the subject of exhaustive harmonisation at the level of the European Union must be assessed in the light of the provisions of that harmonising measure, and not in the light of the provisions of primary law (judgment of 12 November 2015, Visnapuu, C‑198/14, EU:C:2015:751, paragraph 40 and the case-law cited).
22


First of all, as is apparent from that wording, that provision allows Member States to refuse to apply or withdraw the benefit of all or part of the provisions of that directive only where the operation coming within its scope, such as a merger involving the companies of various Member States (a cross-border merger), has as its principal objective, or one of its principal objectives, tax evasion or tax avoidance (see, to that effect, judgment of 17 July 1997, Leur-Bloem, C‑28/95, EU:C:1997:369, paragraph 38).
23


Next, as part of that reservation of competence, Article 11(1)(a) of Directive 90/434 allows the Member States to provide for a presumption of tax evasion or tax avoidance in cases where the merger is not carried out for valid commercial reasons (see, to that effect, judgment of 17 July 1997, Leur-Bloem, C‑28/95, EU:C:1997:369, paragraph 39).
24


Lastly, concerning the exercise of that option and the application of that presumption, it is apparent from the case-law of the Court that, in the absence of more detailed EU law provisions in that regard, it is for the Member States, observing the principle of proportionality, to determine the provisions needed for the purposes of applying Article 11(1)(a) of Directive 90/434 (see, to that effect, judgment of 17 July 1997, Leur-Bloem, C‑28/95, EU:C:1997:369, paragraph 43).
28


In this regard, it should be recalled that the Court has already held that a cross-border merger constitutes a particular method of exercise of the freedom of establishment, important for the proper functioning of the internal market, and is therefore among those economic activities in respect of which Member States are required to comply with that freedom (see, to that effect, judgment of 13 December 2005, SEVIC Systems, C‑411/03, EU:C:2005:762, paragraph 19).
30


In that context, the Court has already clarified that the Member States must grant those tax advantages to operations coming within the scope of that directive, unless those operations have as their principal objective, or as one of their principal objectives, tax evasion or tax avoidance within the meaning of Article 11(1)(a) of the directive (judgment of 11 December 2008, A.T., C‑285/07, EU:C:2008:705, paragraph 30).
36


In the absence of relevant EU rules, the detailed procedural rules designed to ensure the protection of the rights which taxpayers acquire under EU law are a matter for the domestic legal order of each Member State, in accordance with the principle of the procedural autonomy of the Member States, provided that they are not less favourable than those governing similar domestic situations (principle of equivalence) and that they do not render impossible in practice or excessively difficult the exercise of rights conferred by the European Union legal order (principle of effectiveness) (judgment of 18 October 2012, Pelati, C‑603/10, EU:C:2012:639, paragraph 23 and the case-law cited).
37


With regard to the principle of effectiveness, it should be borne in mind that every case in which the question arises as to whether a national procedural rule makes the exercise of rights conferred on individuals by the legal order of the European Union impossible in practice or excessively difficult must be analysed by reference, where appropriate, to the basic principles of the national legal system concerned, including the principle of legal certainty (see, to that effect, judgments of 27 June 2013, Agrokonsulting, C‑93/12, EU:C:2013:432, paragraph 48, and of 6 October 2015, Târșia, C‑69/14, EU:C:2015:662, paragraph 36).
38


In that regard, the Court has already held that the requirement of legal certainty must be observed all the more strictly in the case of EU rules liable to entail financial consequences, in order that those concerned may know precisely the extent of the obligations which those rules impose on them (see, to that effect, judgments of 21 February 2006, Halifax and Others, C‑255/02, EU:C:2006:121, paragraph 72, and of 9 July 2015, Cabinet Medical Veterinar Dr. Tomoiagă Andrei, C‑144/14, EU:C:2015:452, paragraph 34).
40


With regard to the principle of effectiveness, compliance with the requirement of legal certainty requires that the procedural rules implementing Directive 90/434 and, in particular, Article 11(1)(a) should be sufficiently precise, clear and foreseeable to enable taxpayers to know precisely their rights in order to ensure that they are able to benefit from tax advantages under the directive and to rely on them, if necessary, before the national courts (see, to that effect, judgments of 28 February 1991, Commission v Germany, C‑131/88, EU:C:1991:87, paragraph 6; of 10 March 2009, Heinrich, C‑345/06, EU:C:2009:140, paragraphs 44 and 45; of 15 July 2010, Commission v United Kingdom, C‑582/08, EU:C:2010:429, paragraphs 49 and 50; and of 18 October 2012, Pelati, C‑603/10, EU:C:2012:639, paragraph 36 and the case-law cited).
42


In that regard, as the Advocate General has observed in points 30 to 34 and 57 of his Opinion, it should be noted that the provisions of the legislation at issue in the main proceedings do not, however, correspond to the practice applied by the tax authority, a situation which is liable to generate uncertainty as to the detailed rules for the application of Article 11(1)(a) of Directive 90/434. Consequently, those detailed rules do not appear to be sufficiently precise, clear and foreseeable to enable taxpayers to ascertain their rights, particularly since at least some of those rules may be changed at the discretion of the tax authority.
45


In order for the taxpayer to know precisely the extent of the rights and obligations that he derives from Directive 90/434 and to take steps accordingly (see, to that effect, judgments of 10 March 2009, Heinrich, C‑345/06, EU:C:2009:140, paragraphs 44 and 45, and of 15 July 2010, Commission v United Kingdom, C‑582/08, EU:C:2010:429, paragraphs 49 and 50), a decision of the tax authority refusing that taxpayer a tax advantage under that directive must always be reasoned so that the taxpayer may ascertain whether the reasons that led that authority not to grant him the advantage laid down in the directive were well founded and, where appropriate, to vindicate his right before the courts having jurisdiction.
47


Concerning the conditions laid down by that legislation, it should be noted that the Court has repeatedly held that the common tax rules laid down by Directive 90/434, which cover a variety of tax advantages, apply without distinction to all operations within the scope of that directive irrespective of the reasons, whether financial, economic or simply fiscal, for those operations (judgment of 20 May 2010, Modehuis A. Zwijnenburg, C‑352/08, EU:C:2010:282, paragraph 41 and the case-law cited).
48


The Court has also made it clear that it is only by way of exception and in specific cases that Member States may, pursuant to Article 11(1)(a) of Directive 90/434, refuse to apply or withdraw the benefit of all or any part of the provisions of that directive (judgment of 20 May 2010, Modehuis A. Zwijnenburg, C‑352/08, EU:C:2010:282, paragraph 45 and the case-law cited).
49


Since that provision provides an exception to the general rules laid down by Directive 90/434, namely the common tax rules applicable to operations coming within the scope of that same directive, it must be subject to strict interpretation (see, to that effect, judgment of 20 May 2010, Modehuis A. Zwijnenburg, C‑352/08, EU:C:2010:282, paragraph 46).
50


First, it should be pointed out that, in the present case, while Directive 90/434 lays down as a principle the deferral of taxation of the capital gains relating to the assets transferred and allows that deferral to be refused only on one condition, namely when the planned operation has as its objective tax evasion or tax avoidance (see, to that effect, judgment of 17 July 1997, Leur-Bloem, C‑28/95, EU:C:1997:369, paragraph 45), the legislation at issue in the main proceedings refuses in a general way to grant that deferral unless the taxpayer first complies with the procedural and substantive requirements under that legislation.
53


Fourthly, concerning the presumption of tax evasion or tax avoidance under Article 11(1)(a) of Directive 90/434, it should be recalled that that provision authorises Member States to provide for a presumption of tax evasion or tax avoidance only where the planned operation has the sole objective of obtaining a tax advantage and is thus not carried out for valid commercial reasons (see, to that effect, judgments of 17 July 1997, Leur-Bloem, C‑28/95, EU:C:1997:369, paragraph 45, and of 10 November 2011, Foggia — Sociedade Gestora de Participações Sociais, C‑126/10, EU:C:2011:718, paragraph 36).
55


The Court has already held, in that regard, that, in order to determine whether the operation concerned pursues the objective of tax evasion or avoidance, the competent national authorities may not confine themselves to applying predetermined general criteria but must subject each particular case to a general examination of that operation, since the imposition of a general rule automatically excluding certain categories of operations from the tax advantage, without account being taken of whether or not there is actually tax evasion or avoidance, would go further than is necessary for preventing such tax evasion or avoidance and would undermine the objective pursued by that directive (judgment of 10 November 2011, Foggia — Sociedade Gestora de Participações Sociais, C‑126/10, EU:C:2011:718, paragraph 37).
56


However, in so far as the legislation at issue in the main proceedings, in order to grant the benefit of the deferral of the taxation of the capital gains under Directive 90/434, systematically and unconditionally requires the taxpayer to show that the operation concerned is justified on economic grounds and does not have as its principal objective, or as one of its principal objectives, tax evasion or tax avoidance, without the tax authority being required to provide even prima facie evidence that there are no valid commercial reasons or evidence of tax evasion or tax avoidance, that legislation introduces a general presumption of tax evasion or tax avoidance.
58


According to settled case-law, Article 49 TFEU requires the abolition of restrictions on the freedom of establishment. Even though, according to their wording, the provisions of the FEU Treaty on freedom of establishment are aimed at ensuring that foreign nationals are treated in the host Member State in the same way as nationals of that 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 under its legislation (judgment of 29 November 2011, National Grid Indus, C‑371/10, EU:C:2011:785, paragraph 35 and the case-law cited).
59


All measures which prohibit, impede or render less attractive the exercise of the freedom of establishment must be considered to be restrictions on that freedom (judgment of 29 November 2011, National Grid Indus, C‑371/10, EU:C:2011:785, paragraph 36 and the case-law cited).
63


Such a restriction is permissible only if it is justified by overriding reasons in the public interest recognised by EU law. It is further necessary, in such a case, that it should be appropriate to ensuring the attainment of the objective in question and not go beyond what is necessary to attain that objective (judgment of 29 November 2011, National Grid Indus, C‑371/10, EU:C:2011:785, paragraph 42 and the case-law cited).
65


In that regard, it should be borne in mind that the Court has already held that prevention of tax evasion is an overriding reason relating to the public interest, capable of justifying a restriction on the exercise of freedom of movement guaranteed by the Treaty, as is the need to safeguard the balanced allocation between the Member States of the power to impose taxes (judgment of 5 July 2012, SIAT, C‑318/10, EU:C:2012:415, paragraphs 36 and 37 and the case-law cited.).
67


As is clear from the case-law of the Court, it follows from the fourth and sixth recitals of that directive that it establishes only a system of deferral of the taxation of the capital gains relating to the assets transferred, which, while avoiding taxation arising from the business transfer itself, safeguards the financial interests of the State of the transferring company while ensuring taxation of those capital gains at the date of their actual disposal (judgment of 19 December 2012, 3D I, C‑207/11, EU:C:2012:818, paragraph 28).