Case C‑686/13

X AB

v

Skatteverket

(Request for a preliminary ruling from the Högsta förvaltningsdomstolen)

‛Reference for a preliminary ruling — Article 49 TFEU — Freedom of establishment — Tax legislation — Corporation tax — Holdings for business purposes — Legislation of a Member State exempting capital gains and, by the same token, excluding deduction of capital losses — Transfer by a resident company of shares in a non-resident subsidiary — Capital loss resulting from a currency loss’

Summary — Judgment of the Court (Second Chamber), 10 June 2015

1. Freedom of establishment — Provisions of the Treaty — Scope — National legislation exempting capital gains and excluding deduction of capital losses resulting from currency losses on transfer of holdings for business purposes between a company and its non-resident subsidiary — Relationship of interdependence between the companies characterised by definite influence — Inapplicability of the provisions on the free movement of capital

   (Arts 49 TFEU and 63 TFEU)

2. Freedom of movement for persons — Freedom of establishment — Tax legislation or Fiscal legislation — Corporation tax — Transfer of holdings for business purposes between a company and its non-resident subsidiary — National legislation exempting capital gains and excluding deduction of capital losses resulting from a currency loss — Lawfulness

   (Art. 49 TFEU)

1.  See the text of the decision.

   (see paras 17-19, 23, 24)

2.  Article 49 TFEU must be interpreted as not precluding the tax legislation of a Member State which, in principle, exempts capital gains on holdings for business purposes from corporation tax and, by the same token, excludes the deduction of capital losses on such holdings, even where those capital losses are due to currency losses.

   As EU law now stands concerning direct taxation, the provisions of the FEU Treaty relating to freedom of establishment cannot be interpreted as requiring the Member States to adapt their own tax systems so as to take account of possible exchange risks faced by companies because of the continued existence within the European Union of a diversity of currencies between which there is no fixed exchange rate or national laws permitting the capital of companies to be denominated in the currencies of third countries.

   (see paras 34, 41, operative part)

Case C‑686/13

X AB

v

Skatteverket

(Request for a preliminary ruling from the Högsta förvaltningsdomstolen)

‛Reference for a preliminary ruling — Article 49 TFEU — Freedom of establishment — Tax legislation — Corporation tax — Holdings for business purposes — Legislation of a Member State exempting capital gains and, by the same token, excluding deduction of capital losses — Transfer by a resident company of shares in a non-resident subsidiary — Capital loss resulting from a currency loss’

Summary — Judgment of the Court (Second Chamber), 10 June 2015

1. Freedom of establishment — Provisions of the Treaty — Scope — National legislation exempting capital gains and excluding deduction of capital losses resulting from currency losses on transfer of holdings for business purposes between a company and its non-resident subsidiary — Relationship of interdependence between the companies characterised by definite influence — Inapplicability of the provisions on the free movement of capital

   (Arts 49 TFEU and 63 TFEU)

2. Freedom of movement for persons — Freedom of establishment — Tax legislation or Fiscal legislation — Corporation tax — Transfer of holdings for business purposes between a company and its non-resident subsidiary — National legislation exempting capital gains and excluding deduction of capital losses resulting from a currency loss — Lawfulness

   (Art. 49 TFEU)

1.  See the text of the decision.

   (see paras 17-19, 23, 24)

2.  Article 49 TFEU must be interpreted as not precluding the tax legislation of a Member State which, in principle, exempts capital gains on holdings for business purposes from corporation tax and, by the same token, excludes the deduction of capital losses on such holdings, even where those capital losses are due to currency losses.

   As EU law now stands concerning direct taxation, the provisions of the FEU Treaty relating to freedom of establishment cannot be interpreted as requiring the Member States to adapt their own tax systems so as to take account of possible exchange risks faced by companies because of the continued existence within the European Union of a diversity of currencies between which there is no fixed exchange rate or national laws permitting the capital of companies to be denominated in the currencies of third countries.

   (see paras 34, 41, operative part)