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Tax & Legal

Tax & Legal

German CFC rules may be compatible with EU law


The European Court of Justice held that the German CFC regulations – as such – do not generally pose a restriction on the freedom of establishment. It is up to the referring court, however, to decide whether the legislation did in fact give the taxpayer the chance to prove that the terms were agreed on for commercial reasons resulting from its status as a shareholder of the non-resident company.
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