On July 20, 2017 the Finanzgericht Köln (Germany) (the Fiscal Court of Cologne) lodged a request for a preliminary ruling with the Court of Justice of the European Union (CJEU) in the Case C-440/17, GS versus Bundeszentralamt für Steuern. The questions referred for a preliminary ruling have been published in the Official Journal of the European Union of November 6, 2017.

Questions referred

I)    Does Article 49 in conjunction with Article 54 TFEU preclude national tax legislation such as that at issue in the main proceedings which denies relief from tax on income from capital on distributions of profits to a non-resident parent company whose sole shareholder is a company with its seat within the country,

in so far as persons have shareholdings in it who would not be entitled to a refund or exemption if they earned the income directly, and the gross income earned by the foreign company in the relevant trading year does not result from its own economic activity, and

1.there are no economic or other significant reasons for the involvement of the foreign company in relation to that income, or

2.the foreign company does not take part in general economic commerce with an establishment suitably equipped for its business purpose,

whereas resident parent companies are granted relief from tax on income from capital without regard to the aforementioned requirements?

II)  Should Article 1(2) of the Parent-Subsidiary Directive be interpreted as precluding a Member State from adopting a rule which denies relief from tax on income from capital on distributions of profits to a non-resident parent company whose sole shareholder is a company with its seat within the country,

in so far as persons have shareholdings in it who would not be entitled to a refund or exemption if they earned the income directly, and the gross income earned by the foreign company in the relevant trading year does not result from its own economic activity, and

1.there are no economic or other significant reasons for the involvement of the foreign company in relation to that income, or

2.the foreign company does not take part in general economic commerce with an establishment suitably equipped for its business purpose?

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