Brussels, 09/11/2015 (Agence Europe) - On Friday 6 November, the MEP Sven Giegold (Greens/EFA, Germany) argued that the President of the European Commission, Jean-Claude Juncker, and that of the Eurogroup, Jeroen Dijsselbloem, should appear before the special TAXE committee of the EP to answer the MEPs' questions in their capacities as former Prime Minister of Luxembourg and Finance Minister of the Netherlands respectively.
Giegold was reacting to leaks published in the French daily newspaper Le Monde and in the German weekly Der Spiegel, alleging that Luxembourg and the Netherlands blocked progress within the 'Code of Conduct Group on Business Taxation' on the exchange of information on tax rulings between the member states and the framework for tax regimes favourable to intellectual property, known as 'patent boxes'. A 2010 document of the 'Code of Conduct' group, revealed by Le Monde, explains that “all of the member states, with the exception of the Netherlands and Luxembourg, support the following lines of conduct: if a member state makes a decision (…) regarding a taxpayer which could be relevant for the administration of another member state, that state must spontaneously exchange this information with that other state (…)”. It was already known that at a meeting in 2012 of a sub-group of the 'Code of Conduct' group, Belgium acknowledged that it did not exchange information because no other state exchanged any with it: this was revealed by the Greens/EFA group in April 2015 (see EUROPE 11291). Subsequently, the legal services of the Council clarified that there was no obligation of reciprocity in the directive on administrative cooperation. A document of the 'Code of Conduct' working group of September 2015 also revealed that very few states practised the exchange of information on rulings (see EUROPE 11405).
Other documents of which Le Monde has had sight revealed that in 2012, “the Netherlands, Belgium and Luxembourg took position against a discussion within the 'Code of Conduct' group on a framework for 'patent boxes' and on a minimum effective taxation rate”. An agreement was reached within the 'Code of Conduct' group on this point in December 2014, thanks to a German-British compromise (see EUROPE 11214). The Commission decided to give the states the benefit of the doubt regarding the implementation of the agreement, but warned that if they did not comply with the new approach within 12 months (to run from June 2015), it would prepare binding legislative measures to make sure that they did.
In any case, Sven Giegold feels that the Commission stood by and allowed the situation to continue and that it “should now explain why it failed to intervene in its role as guardian of the EU treaties”.
The legal services of the EP have been examining the question of whether the Commission failed to play its role by enforcing the automatic exchange of information. In an opinion of which EUROPE has had sight, it states that the “Commission is responsible (…) for ensuring the correct implementation of the information exchange mechanisms (…). However, it has discretion in determining the more appropriate means to achieve this goal. In particular, the Commission is under no legal obligation to open formal infringement procedures against member states in all cases of suspected breach of EU law”. The opinion concludes: “the assessment whether in the present circumstances the Commission has appropriately carried out its responsibility to ensure the correct application (of the exchange) is of political nature and falls within the scope of the political control which Parliament exercises over the activities of the Commission”. For its part, the Commission takes the view that once the automatic exchange of information on tax rulings enters into force in 2017, it will be able to open infringement proceedings. (Original version in French by Elodie Lamer)