EU Investigates Luxembourg's Tax Treatment of Engie
September 19 2016 - 7:51AM
Dow Jones News
By Laurence Norman
BRUSSELS--The European Commission said Monday it had opened a
probe into whether Luxembourg's tax treatment of French energy
giant Engie SA breached European Union state-aid laws, the latest
in a series of probes looking at past tax deals.
The commission, the EU's executive arm, said it had concerns
that several tax rulings made in September 2008 by Luxembourg
authorities may have given GDF Suez group, now called Engie, an
unfair advantage over other companies.
In a press release, the commission said that several intra-group
financial transactions appeared to allow the company to reduce
their taxation on profits arising in Luxembourg.
As a result, the commission said, the company may have paid no
tax on a "significant proportion of the profits" generated by the
transactions.
"Therefore, we will look carefully at tax rulings issued by
Luxembourg to GDF Suez," said European Union antitrust commissioner
Margrethe Vestager. "They seem to contradict national taxation
rules and allow GDF Suez to pay less tax than other companies."
The commission didn't say how much money might be at stake in
the case.
In a statement following the announcement of the probe,
Luxembourg's finance ministry said that the government "considers
that no special tax treatment or selective advantage has been
awarded to any Engie group company in Luxembourg."
The ministry said it would provide all the information the
commission requests for the probe.
The Engie tax treatment probe comes after the commission in late
August demanded that Ireland recoup roughly EUR13 billion ($14.5
billion) of unpaid taxes accumulated over more than a decade by
Apple Inc., a move that intensified a feud between the EU and U.S.
over the bloc's tax probes into American firms.
The commission is continuing to investigate Amazon.com Inc. and
McDonald's Corp. over their tax arrangements in Luxembourg. Amazon
has previously said it receives no special tax treatment from
Luxembourg while McDonald's has said it "complies with all tax laws
and rules in Europe."
Engie is one of several European firms that have also been
targeted. Others include Fiat Chrysler Automobiles NV. However the
car maker was only required to pay up to EUR30 million in
taxes.
Write to Laurence Norman at laurence.norman@wsj.com
(END) Dow Jones Newswires
September 19, 2016 07:36 ET (11:36 GMT)
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