The recipient, the taxpayer and other third parties concerned must be able to submit to judicial review an information injunction issued in the context of an international exchange of information between tax authorities, Advocate General Juliane Kokott said in her Opinion delivered on Thursday 2 July (Cases C-245 and 246/19).
Between October 2016 and March 2017, a Luxembourg bank and companies, as well as a Spanish artist, lodged an action with the Luxembourg courts against the injunctions of the Luxembourg tax authorities requesting information (copies of conventions on the rights of the artist, copies of invoices relating to these contracts, information on bank accounts) on the basis of a request made by the Spanish tax authorities under the 1986 bilateral tax convention between Luxembourg and Spain and European legislation (Directives 2011/16/EU and 2018/822) governing administrative cooperation in the field of taxation.
Until March 2019, Luxembourg legislation did not provide for the possibility of lodging a judicial appeal.
In her Opinion, Ms Kokott proposes that the Court should reply that, in accordance with Article 47 of the Charter of Fundamental Rights, such injunctions may be challenged by the persons concerned – the addressee of the injunction, the taxpayer and the third parties concerned, even if they are legal persons – before the courts of the Member State of the authority whose support is sought.
Regarding the question of how the request must be precisely and concretely stated in order for the requested tax authorities to assess the “likely relevance” of the information requested, the Advocate General is of the view that it is incumbent on the requesting authority to justify its request for information in order to enable the requested authority to assess the tax relevance of the information requested.
The initial request must therefore present facts or at least concrete suspicions about transactions with tax implications so as to exclude any “fishing expeditions”, Ms Kokott points out.
Those grounds must enable the State of the tax authority whose support is sought to justify before its courts the infringements of fundamental rights involved in providing administrative assistance to the recipient, the taxpayer or third parties concerned.
See the Court’s conclusions (in French): https://bit.ly/3f5Wgsl (Original version in French Mathieu Bion)