Britain on Wednesday lost its court challenge against an EU order to recover millions of euros from the London Stock Exchange, ITV and other multinationals that benefited from an illegal exemption in a UK tax scheme.
The Luxembourg-based General Court rejected the UK arguments and backed the European Commission's 2019 decision issued before Britain's withdrawal from the European Union.
The case was one of several in the EU executive's crackdown against sweetheart tax deals offered by EU countries to multinationals, of which the most high profile was Apple's tax arrangement with Ireland.
The Commission, which acts as the EU competition watchdog, said Britain’s Controlled Foreign Company (CFC) rules aimed at attracting companies to set up headquarters in Britain and discourage UK companies moving offshore, gave these firms an illegal advantage.
Britain and ITV, backed by the London Stock Exchange, subsequently appealed against the EU decision.
“The Commission did not err in finding that the exemptions at issue conferred a selective advantage on the beneficiaries thereof and, consequently, all the pleas relating thereto must be rejected,” the General Court said.
The parties can appeal to the EU Court of Justice (CJEU) on matters of law.
The Commission did not identify the companies which benefited from the scheme. However BBA Aviation, Chemring , Daily Mail & General, Diageo, Euromoney, Inchcape, Meggitt, Smith & Nephew and WPP have mentioned the EU investigation in their accounts.
Reuters
UK loses court challenge against EU order to recover millions in state aid
Image: REUTERS/Peter Nicholls/File Photo
Britain on Wednesday lost its court challenge against an EU order to recover millions of euros from the London Stock Exchange, ITV and other multinationals that benefited from an illegal exemption in a UK tax scheme.
The Luxembourg-based General Court rejected the UK arguments and backed the European Commission's 2019 decision issued before Britain's withdrawal from the European Union.
The case was one of several in the EU executive's crackdown against sweetheart tax deals offered by EU countries to multinationals, of which the most high profile was Apple's tax arrangement with Ireland.
The Commission, which acts as the EU competition watchdog, said Britain’s Controlled Foreign Company (CFC) rules aimed at attracting companies to set up headquarters in Britain and discourage UK companies moving offshore, gave these firms an illegal advantage.
Britain and ITV, backed by the London Stock Exchange, subsequently appealed against the EU decision.
“The Commission did not err in finding that the exemptions at issue conferred a selective advantage on the beneficiaries thereof and, consequently, all the pleas relating thereto must be rejected,” the General Court said.
The parties can appeal to the EU Court of Justice (CJEU) on matters of law.
The Commission did not identify the companies which benefited from the scheme. However BBA Aviation, Chemring , Daily Mail & General, Diageo, Euromoney, Inchcape, Meggitt, Smith & Nephew and WPP have mentioned the EU investigation in their accounts.
Reuters
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