Lisbon, 21/11/2014 (Agence Europe) - Danish national Margrethe Vestager had only just started as the new EU Competition Commissioner when the LuxLeaks scandal broke out, putting the Commissioner, whose responsibilities are already high-profile, in the spotlight. She is planning to make use of the LuxLeaks documents, but explained in an interview with this newsletter on the fringes of an ALDE summit in Lisbon on Friday 21 November that they are not enough in themselves to enable the Commission to open new investigations. On Monday, we will publish the second half of her interview, relating to the Google question (interview by EL).
Agence Europe: You say you can use LuxLeaks documents, but in order to incorporate them on a one-by-one basis, don't you have to make a formal request to a government?
Margrethe Vestager: The LuxLeaks documents show what consultants and companies have done in order to get tax rulings. It's not concrete tax rulings as such, so you cannot make a case on the Luxembourg documents. You need much more info in order to do that. We will, of course, examine the paperwork and see if there's anything blatant and obvious to go for. We need to get the technical knowledge from the cases open already.
You stress the need to finish the current tax ruling investigations (Amazon and Fiat in Luxembourg, Starbucks in the Netherlands and Apple in Ireland). Does that mean that you will not be opening any other tax ruling investigations until those four cases are concluded?
No, basically I do not rule anything out, but I think it's important that the cases that we have open now are treated with high priority in order to finalise them because we will get much wiser and we need that knowledge to proceed. That doesn't prevent us from opening other cases if we think that's the right thing to do.
At your hearing at the EP, you said these investigations should not be a way of introducing common fiscal policies through the back door. Has LuxLeaks made you change your mind?
No, it hasn't. What I can do is to investigate if being given state aid in the form of fiscal aid, means one company had more favourable treatment than another one. If our investigations show that there is a sort of arm's length and that tax rulings are used in a sort of general way with no discrimination, then there is no competition issue, but I would think still there is a debate about taxation. That is why I am cooperating closely with Moscovici (Taxation Commissioner, Ed.). Proposals are being drafted, and these will be completely straight forward tax policies by the front door. LuxLeaks has given a sort of new momentum to the general taxation debate.
If the tax rulings prove to be illicit state aid, the Commission is entitled to ask the companies to repay the advantages they have received. Will the Commission do so?
It is too early to say at this stage, but basically yes, the principle is that if incompatible with the treaty, then there's going to be recovery as the main rule and to the state which granted the privileges.
Have you considered questioning Jean-Claude Juncker, who was Luxembourg's prime minister at the time?
No, not at all. It is very important that cases talk for themselves and I do hope that also in the public debate we'll keep debating the taxation issue and the privileges that are attached to tax rulings, more than a personal debate.
How is Luxembourg cooperating on this matter?
We have had very good cooperation on Amazon and Fiat, what we still need is the list of tax rulings they've made. We asked for the years 2010 to 2013 and we have got a list of that kind from other countries. The reason we've asked is to have a structured approach to see if there is a pattern, and if there is, is there arm's length and is everybody treated the same way with no discrimination. If so, then fine. I do hope Luxembourg will provide this info, because there has been a new situation since we passed the legislation on AEI on personal accounts. The situation has changed.
You have also asked for information about 'patent boxes'. Is it a good sign that no formal investigations have yet been opened?
An overview is being made in the area of the Code of Conduct Group. I think it will be interesting to see the outcome as it will give us a complete overview of the construction of patent boxes. There are several types of construction and they cannot be treated as one thing.
Do you therefore want to await the outcome of the Code of Conduct Group before deciding whether to open investigations?
Yes. As far as I know, if I open an investigation, that will stop the work of the Code of Conduct Group.