Opinion Statement ECJ-TF 2/2022 on the CJEU decision of 27 January 2022 in Case C-788/19, European Commission v Kingdom of Spain (Form 720), on the Lack of Proportionality of the Consequences Derived from the Failure to Provide Information Concerning Assets or Rights Held in Other Member States of the European Union or the EEA

CFE Tax Advisers Europe 2022

Queen Mary Law Research Paper No. 386/2022

12 Pages Posted: 14 Jun 2022 Last revised: 19 Jan 2023

See all articles by João Félix Pinto Nogueira

João Félix Pinto Nogueira

International Bureau of Fiscal Documentation; Law School - Catholic University of Portugal (UCP); University of Cape Town (UCT)

Georg Kofler

Vienna University of Economics and Business - Institute for Austrian and International Tax Law

Francisco Alfredo Garcia Prats

Universitat de València

Werner C. Haslehner

Universite du Luxembourg

Volker Heydt

Independent

Eric Kemmeren

Fiscal Institute Tilburg

Michael Lang

Vienna University of Economics and Business

Christiana HJI Panayi

Queen Mary University of London, School of Law

Stella Raventos-Calvo

Asociación Española de Asesores Fiscales (AEDAF)

Emmanuel Raingeard de la Blétière

Independent

Isabelle Richelle

Independent

Rupert Shiers

Independent

Date Written: June 1, 2022

Abstract

This is an Opinion Statement prepared by the CFE ECJ Task Force on the Commission v Spain case (also cited as the 'Form 720' case), in which the First Chamber of the Court of Justice of the EU (ECJ) delivered its decision on 27 January 2022. The Court, in its decision, ruled in favour of the action brought by the Commission and did not fully follow the reasoning of AG Saugmandsgaard Øe in his Opinion of 15 July 2021, who proposed only to partially accept the action brought by the Commission.

The Court held that the Kingdom of Spain had failed to fulfil its obligations under articles 63 TFEU and 40 of the EEA Agreement by imposing disproportionate measures on the failure to duly comply with the obligation to provide information concerning assets and rights located abroad. The Spanish legislation provided for very serious economic consequences, such as the taxation of the value of not duly declared assets and rights as unjustified capital gains with no statute of limitations period. The legislation also provided for a proportional fine of 150% of the tax calculated on amounts corresponding to the value of those assets or those rights, which could be applied concurrently with flat-rate fines. At the same time, such flat-rate fines were much higher than the penalties imposed in respect of similar infringements in a purely national context, not being capped by any amount. Commission v. Spain is an important case as it addresses a number of relevant issues regarding the limits that the Member States must respect when implementing measures to counteract international tax avoidance and evasion.

Keywords: Taxation, Tax law, European taxation, exchange of information, OECD

JEL Classification: K33, K34, F13, E62, D78, E62, F02, F23, F42, H20, H22, H23, H25, H26, H87, O19, O23, O24

Suggested Citation

Pinto Nogueira, João Félix and Kofler, Georg and Garcia Prats, Francisco Alfredo and Haslehner, Werner Christof and Heydt, Volker and Kemmeren, Eric and Lang, Michael and HJI Panayi, Christiana and Raventos-Calvo, Stella and Raingeard de la Blétière, Emmanuel and Richelle, Isabelle and Shiers, Rupert, Opinion Statement ECJ-TF 2/2022 on the CJEU decision of 27 January 2022 in Case C-788/19, European Commission v Kingdom of Spain (Form 720), on the Lack of Proportionality of the Consequences Derived from the Failure to Provide Information Concerning Assets or Rights Held in Other Member States of the European Union or the EEA (June 1, 2022). CFE Tax Advisers Europe 2022, Queen Mary Law Research Paper No. 386/2022, Available at SSRN: https://ssrn.com/abstract=4124938 or http://dx.doi.org/10.2139/ssrn.4124938

João Félix Pinto Nogueira (Contact Author)

International Bureau of Fiscal Documentation ( email )

Rietlandpark, 301
Amsterdam, 1019 DW
Netherlands
+31205540100 (Phone)

Law School - Catholic University of Portugal (UCP) ( email )

Lisboa
Portugal
0650446433 (Phone)
4760-164 (Fax)

HOME PAGE: http://https://fd.porto.ucp.pt/pt-pt/pessoa/joao-nogueira

University of Cape Town (UCT) ( email )

Private Bag X3
Rondebosch, Western Cape 7701
South Africa

Georg Kofler

Vienna University of Economics and Business - Institute for Austrian and International Tax Law ( email )

Welthandelsplatz 1
Building D3
Vienna, VIenna 1020
Austria

Werner Christof Haslehner

Universite du Luxembourg ( email )

Luxembourg

Volker Heydt

Independent

Eric Kemmeren

Fiscal Institute Tilburg ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31.13.466.8129/2412 (Phone)
+31.13.466.3073 (Fax)

HOME PAGE: http://www.tilburguniversity.edu/webwijs/show/kemmeren-3.htm

Michael Lang

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, 1020
Austria

Christiana HJI Panayi

Queen Mary University of London, School of Law ( email )

67-69 Lincoln’s Inn Fields
London, WC2A 3JB
United Kingdom

Stella Raventos-Calvo

Asociación Española de Asesores Fiscales (AEDAF) ( email )

Spain

Isabelle Richelle

Independent

Rupert Shiers

Independent

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