Keywords
Summary

Keywords

Free movement of capital – Restrictions

(EC Treaty, Art. 73b (now Art. 56 EC))

Summary

Article 73b of the Treaty (now Article 56 EC) is to be interpreted as meaning that it does not preclude legislation of a Member State by which the estate of a national of that Member State who dies within 10 years of ceasing to reside in that Member State is to be taxed as if that national had continued to reside in that State, while enjoying relief in respect of inheritance taxes levied by other States.

By enacting identical taxation provisions for the estates of nationals who have transferred their residence abroad and of those who have remained in the Member State concerned, such legislation cannot discourage the former from making investments in that Member State from another State nor the latter from doing so in another Member State from the Member State concerned, and, regardless of the place where the assets in question are situated, nor can it diminish the value of the estate of a national who has transferred his residence abroad.

The differences in treatment between residents who are nationals of the Member State concerned and those who are nationals of other Member States resulting from such legislation flow, in the absence of any unifying or harmonising measures adopted in the Community context, from the Member States’ power to define, by treaty or unilaterally, the criteria for allocating their powers of taxation.

Moreover, national legislation which would discourage a national who wishes to transfer his residence to another State, and thus hinder his freedom of movement, cannot for that reason alone constitute a restriction on the movement of capital within the meaning of Article 73b of the Treaty.

(see paras 46-47, 50-51, operative part)