Are the OECD/G20 pillar two GloBE-rules compliant with the fundamental freedoms? Luc De Broe & Mélanie Massant
By: De Broe, Luc
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Contributor(s): Massant, Mélanie.
Material type: 
ArticlePublisher: 2021Subject(s): TIPO MÍNIMO GLOBAL | SEGUNDO PILAR (OCDE) | LIBERTAD DE ESTABLECIMIENTO Y SERVICIOS | PRINCIPIO DE SUBSIDIARIEDAD | PRINCIPIO DE PROPORCIONALIDAD | UNION EUROPEA
In:
EC Tax Review v. 30, Issue 3, June 2021, p. 86-98Summary: In this article, the authors focus on whether the Global Anti-Base Erosion (GloBE) rules, as set out in a Blueprint of October 2020, comply with the EU fundamental freedoms. This compatibility is tested in two distinct scenarios. In the first scenario, the assumption is taken that the GloBE-rules will be implemented directly by the Members States and in the second scenario, the assumption is taken that the GloBE-rules will be implemented indirectly through an EU Directive. The analysis of the first scenario shows that the GloBE-rules collide with the freedom of establishment. For the GloBE-rules to be fully in line with this freedom, it is recommended that they include a substance-based carve-out such as the one foreseen in Article 7(2) of the Anti-Tax Avoidance Directive (ATAD). The analysis of the second scenario, which focuses on the EU principles of subsidiarity and proportionality, shows that, even though the GloBE-rules might collide with the freedom of establishment, they could still be successfully implemented given the broad discretion that the Court of Justice of the European Union leaves to the Union legislature. Nonetheless, also here recommendations are made to reduce disproportionate frictions.
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| OP 2141-B/2021/2-4 The development of the doctrine of abuse of law and the Danish cases | OP 2141-B/2021/3 EC Tax Review | OP 2141-B/2021/3-1 Towards mandatory e-invoicing for VAT and a common clearance system | OP 2141-B/2021/3-2 Are the OECD/G20 pillar two GloBE-rules compliant with the fundamental freedoms? | OP 2141-B/2021/3-3 The comitology proposal | OP 2141-B/2021/3-4 Cloaking Member State objectives through legislative instruments | OP 2141-B/2021/3-5 Tax consolidation regime in European Union |
Disponible también en formato electrónico.
Resumen.
In this article, the authors focus on whether the Global Anti-Base Erosion (GloBE) rules, as set out in a Blueprint of October 2020, comply with the EU fundamental freedoms. This compatibility is tested in two distinct scenarios. In the first scenario, the assumption is taken that the GloBE-rules will be implemented directly by the Members States and in the second scenario, the assumption is taken that the GloBE-rules will be implemented indirectly through an EU Directive. The analysis of the first scenario shows that the GloBE-rules collide with the freedom of establishment. For the GloBE-rules to be fully in line with this freedom, it is recommended that they include a substance-based carve-out such as the one foreseen in Article 7(2) of the Anti-Tax Avoidance Directive (ATAD). The analysis of the second scenario, which focuses on the EU principles of subsidiarity and proportionality, shows that, even though the GloBE-rules might collide with the freedom of establishment, they could still be successfully implemented given the broad discretion that the Court of Justice of the European Union leaves to the Union legislature. Nonetheless, also here recommendations are made to reduce disproportionate frictions.
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