Luxembourg’s decision for Fiat does not include government support according to the AG ECJ

Luxembourg’s decision for Fiat does not include government support according to the AG ECJ


Attorney General Pikamäe concludes that the EC’s decision on Fiat Chrysler Finance Europe should be overturned. According to the AG, the Supreme Court erred in law in its decision.

The European Commission considers that the tax decision issued by Luxembourg to Fiat Chrysler Finance Europe includes Government support. The approach is included in the decision to specify FCFT payments for its funding activities to the Fiat group. This can then be used to determine FCFT’s annual taxable income for corporate income tax in Luxembourg. Fiat and Luxembourg do not agree with EC’s decision and appeal for the decision to be annulled. The Supreme Court ruled on 24 September 2019 (Numbers T-755/15 and T-759/15, UN 2019 / 54.17) that the tax decision issued by Luxembourg for Fiat Chrysler Finance Europe includes Government support. Then Ireland begins to appeal.

Attorney General Pikamäe concludes that the EC’s decision on Fiat Chrysler Finance Europe should be overturned. According to the AG, the Supreme Court erred in law in its decision. Indeed, the investigation into the existence of economic benefits was erroneously evaluated against a system of references with an arm length principle that is not derived from national tax law. Thus the Supreme Court violated the terms of the division of powers between the EU and its Member States.