EU: Infringement Proceedings
The Commission has commenced infringement proceedings against France (energy products) and Germany (cross-border losses).
France
These proceedings show what happens when a Member State does not implement an ECJ decision (which had arisen under infringement proceedings) into National Law – the Commission must initiate further infringement proceedings against the Member State. In this situation, further proceedings have been initiated against France for failure to implement a Court ruling relating to non-transposition by France of the Directive on energy taxation (2003/96/EC).
Germany
The Commission has formally requested Germany to modify its legislation on cross-border loss deduction which it considers incompatible with the principle of freedom of establishment and the free movement of capital.
According to the press release, whilst losses generated in Germany can be offset without restriction within the same income category and against other income categories, German Income Tax Law restricts the scope for offsetting certain types of negative income from foreign sources to income in the same income category, generated in the same foreign state.