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Document C2004/217/49
Case T-211/04: Action brought on 9 June 2004 by the Government of Gibraltar against the Commission of the European Communities
Case T-211/04: Action brought on 9 June 2004 by the Government of Gibraltar against the Commission of the European Communities
Case T-211/04: Action brought on 9 June 2004 by the Government of Gibraltar against the Commission of the European Communities
OJ C 217, 28.8.2004, p. 27–28
(ES, CS, DA, DE, ET, EL, EN, FR, IT, LV, LT, HU, NL, PL, PT, SK, SL, FI, SV)
28.8.2004 |
EN |
Official Journal of the European Union |
C 217/27 |
Action brought on 9 June 2004 by the Government of Gibraltar against the Commission of the European Communities
(Case T-211/04)
(2004/C 217/49)
Language of the case: English
An action against the Commission of the European Communities was brought before the Court of First Instance of the European Communities on 9 June 2004 by the Government of Gibraltar, represented by M. Llamas, lawyer, J. Temple Lang, Solicitor, A. Petersen, lawyer, and K. Nordlander, lawyer.
The applicant claims that the Court should:
— |
annul the decision in its entirety; |
— |
order the Commission to pay Gibraltar's legal and other costs and expenses in relation to this matter. |
Pleas in law and main arguments:
The applicant contests the Commission decision of 30 March 2004 on the aid scheme which the United Kingdom is planning to implement with regard to the Government of Gibraltar Corporation Tax Reform (1). In the decision, the Commission finds that the proposed tax reform constitutes state aid incompatible with the common market.
The applicant states that the Commission considers the reform regionally selective in that it confers tax advantages to companies in Gibraltar compared to companies in the United Kingdom and that the reform is materially selective in that specific features confer tax advantages to some companies in Gibraltar compared to other companies in Gibraltar.
In support of its application, the applicant submits firstly that the Commission misapplied the law and committed errors in reasoning in finding that Gibraltar's proposed tax reform is regionally selective.
In this regard, the applicant states that the assumption that Gibraltar is part of the United Kingdom, is wrong. According to the applicant, this is clear under domestic constitutional law, public international law and Community law.
The applicant furthermore submits that the Commission's regional selectivity principle cannot apply to Gibraltar. According to the applicant, the decision concerns two tax jurisdictions which are entirely separate and mutually exclusive so that Gibraltar's tax laws cannot be treated as derogations from tax law in the United Kingdom.
Secondly, the applicant submits that the Commission misapplied the law and committed errors in reasoning in finding that tax reform is materially selective. According to the applicant, the reform is of a general nature and represents a reasonable choice of economic policy by Gibraltar.
According to the applicant, the provisions that companies who make no profits are not taxed and that companies are not required to pay more than a specified maximum amount, are merely designed to avoid over-taxation and do not apply selectively to a particular group or category.
The applicant also claims that the Commission is wrong in stating in relation to the payroll tax and property tax not applying to companies without commercial buildings or employees in Gibraltar, that the reform exempts an offshore sector and is materially selective on hat ground. The applicant claims furthermore that the Commission breached essential procedural requirements in this regard because neither the United Kingdom nor the applicant were given an opportunity to comment on this issue during the formal investigation.
Finally, the applicant submits that the reform cannot be considered selective because its nature, general scheme and essential features are designed to suit the special characteristics of the economy in Gibraltar and in particular its limited size, scarcity of labour, service dominated industry and operational simplicity for a small administration.
(1) State aid C 66 /2002 — Gibraltar government corporation tax reform