A judge at the Court of Justice of the EU (CJEU) ruled Thursday in favor of French energy company Engie in a dispute with Brussels over controversial tax rebates in Luxembourg worth €120 million.
Advocate General Juliane Kokott proposed to the judges of the CJEU to annul the decision of the European Commission which considered tax benefits granted to Engie as illegal state aid, according to a statement from the Luxembourg-based court. The CJEU ruling will be issued at a later date and the judges who are to deliberate in the case are not bound by the Advocate General’s findings, it says.
Brussels had opened an in-depth investigation in September 2016 into “two financial arrangements” that allowed Engie to partially evade taxes in Luxembourg. This investigation was aimed at tax agreements signed in 2008 and 2010 by the Grand Duchy with the energy company, for the benefit of two companies of the group established in the country: Engie LNG Supply and Engie Treasury Management.
In June 2018, the European Commission had concluded that the Engie group had benefited from illegal tax advantages in Luxembourg and demanded that the Grand Duchy recover €120 million from the company of which the French state is the largest shareholder. Engie and Luxembourg had initially referred the matter to the European Court of First Instance, which ruled in favor of the Commission and rejected their appeals. They then filed an appeal with the Court of Justice, which is currently under review.
The European Commission has already suffered a series of defeats in similar cases. The car manufacturer Fiat (Stellantis group) obtained in November from the CJEU the annulment of a decision of Brussels which demanded that it reimburse 30 million euros of tax benefits to Luxembourg. The Commission also lost to Apple, Amazon and Starbucks in other tax disputes in Ireland, Luxembourg and the Netherlands.
