The European Commission concluded on Wednesday 22 January that the tax advantage granted by Germany to ailing companies in the event of major changes in their shareholding structure (aid for tax loss carry-forwards), known as the ‘Sanierungsklausel’ (reorganisation clause), does not constitute State Aid within the meaning of EU rules.
The scheme allows an ailing company to offset losses in a given year against profits in subsequent years, despite changes in its shareholder structure. The Commission's decision follows the judgments of the EU Court of Justice (Cases C-203/16 P, C-208/16 P, C-209/16 P, C-219/16 P) which annulled in 2018 a 2011 Commission decision on State Aid.
In order to implement these judgments, the Commission assessed the measure against a broader reference framework, including the rules under German law which generally allow companies to carry forward losses for tax purposes. It found that the Sanierungsklausel system does not derogate from these general rules and therefore does not provide a ‘selective’ advantage to ailing companies vis-à-vis other companies.
The Commission therefore concluded that the aid did not constitute State Aid. For more information: http://bit.ly/37dvoT7 (Original version in French by Lionel Changeur)