This document is an excerpt from the EUR-Lex website
Document C2006/281/08
Case C-196/04: Judgment of the Court (Grand Chamber) of 12 September 2006 (reference for a preliminary ruling from the Special Commissioners, London — United Kingdom) — Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue (Freedom of establishment — Law on controlled foreign companies — Inclusion of the profits of controlled foreign companies in the tax base of the parent company)
Case C-196/04: Judgment of the Court (Grand Chamber) of 12 September 2006 (reference for a preliminary ruling from the Special Commissioners, London — United Kingdom) — Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue (Freedom of establishment — Law on controlled foreign companies — Inclusion of the profits of controlled foreign companies in the tax base of the parent company)
Case C-196/04: Judgment of the Court (Grand Chamber) of 12 September 2006 (reference for a preliminary ruling from the Special Commissioners, London — United Kingdom) — Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue (Freedom of establishment — Law on controlled foreign companies — Inclusion of the profits of controlled foreign companies in the tax base of the parent company)
OJ C 281, 18.11.2006, p. 5–5
(ES, CS, DA, DE, ET, EL, EN, FR, IT, LV, LT, HU, NL, PL, PT, SK, SL, FI, SV)
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18.11.2006 |
EN |
Official Journal of the European Union |
C 281/5 |
Judgment of the Court (Grand Chamber) of 12 September 2006 (reference for a preliminary ruling from the Special Commissioners, London — United Kingdom) — Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue
(Case C-196/04) (1)
(Freedom of establishment - Law on controlled foreign companies - Inclusion of the profits of controlled foreign companies in the tax base of the parent company)
(2006/C 281/08)
Language of the case: English
Referring court
Special Commissioners, London
Parties to the main proceedings
Applicants: Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd
Defendant: Commissioners of Inland Revenue
Re:
Preliminary ruling — Special Commissioners, London — National legislation attributing to a parent company the profits of a subsidiary resident in another Member State which has a lower rate of taxation — Obligation of the parent company to pay a charge in order to off set the difference between the two rates of taxation — Whether compatible with Articles 43 EC, 49 EC and 56 EC
Operative part of the judgment
Articles 43 EC and 48 EC must be interpreted as precluding the inclusion in the tax base of a resident company established in a Member State of profits made by a controlled foreign company in another Member State, where those profits are subject in that State to a lower level of taxation than that applicable in the first State, unless such inclusion relates only to wholly artificial arrangements intended to escape the national tax normally payable. Accordingly, such a tax measure must not be applied where it is proven, on the basis of objective factors which are ascertainable by third parties, that despite the existence of tax motives that controlled company is actually established in the host Member State and carries on genuine economic activities there.