Cross-border exchange of tax information upon request and fundamental rights – Can the right balance be struck?: Joined cases C-245/19 and C-246/2019 État luxembourgeois contre B
| Author | Saturnina Moreno González |
| Date | 01 October 2021 |
| DOI | 10.1177/1023263X211021549 |
| Published date | 01 October 2021 |
| Subject Matter | Case Notes |
Case Note
Cross-border exchange of tax
information upon request and
fundamental rights – Can the
right balance be struck?: Joined
cases C-245/19 and C-246/2019
´
Etat luxembourgeois contre B
Saturnina Moreno Gonz´
alez*
Abstract
On 6 October 2020, in joined cases C-245/19 and C-246/19, ´
Etat luxembourge ois contre B,
theCourtofJusticedeliveredalandmarkruling about the fundamental right to a judicial
remedy against an information order issued by the national tax authorities of a Member State
in the application of Directive 2011/16/EU. The Court ruled that the holders of the taxpayer’s
information have the right to directly challenge the request to provide information but, dif-
fering from the Opinion of Advocate General Kokott, the Court decided that, when other
remedies are available, the taxpayer under tax investigation and other third parties concerned
do not have the right to direct judicial remedy against the information order. Likewise, the
Court clarified how specific and precise the information requested must be in order to admit
that the request for information is foreseeably relevant for the taxation of the concerned
taxpayer. Following the Berlioz case, the ruling at hand continues to outline the content, scope
and limits of fundamental rights in cross-border exchanges of tax information upon request in
the European Union. However, this casuistic approach will not necessarily result in the
development of a coherent and general framework of protection, which underlines the need
for a common minimum standard to enhance the protection of fundamental rights in cross-
border situations.
* Full Professor of Finance and Tax Law, University of Castilla-La Mancha, Albacete, Spain
Corresponding author:
Saturnina Moreno Gonz´
alez, Full Professor of Finance and Tax Law, University of Castilla-La Mancha, Albacete 02071,
Spain.
E-mail: saturnina.moreno@uclm.es
Maastricht Journal of European and
Comparative Law
ªThe Author(s) 2021
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DOI: 10.1177/1023263X211021549
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MJ
2021, Vol. 28(5) 714–730
Keywords
Exchange of information upon request, Charter of Fundamental Rights of the European Union,
right to an effective remedy, foreseeable relevance, fishing expeditions, group requests
1. Introduction
One of the defining trends of international taxation in recent years is a series of initiatives designed
to bolster transparency and admin istrative cooperation (especiall y in the area of exchange of
information) in order to more effectively fight against phenomena such as tax avoidance, tax
evasion and aggressive tax planning. Additionally, globalization and the digitization of the econ-
omy have raised challenges for national taxation systems in terms of revenue and fairness, one of
the responses to which has been to promote transparency and boost administrative cooperation,
given the serious difficulties in reaching a global consensus to reform the existing principles and
rules of international taxation. The COVID-19 pandemic has intensified the previously mentioned
trend as the Member States are obliged to generate the tax revenue needed to deal with the large
increases in public spending resulting from the challenges of the present health crisis.
1
Over the last decade, a number of actions have been undertaken to favour greater international
administrative cooperation, the most important of which are: (i) enhancing the effectiveness of the
legal instruments that regulate the international exchange of tax information on request (EoIR), and
(ii) the trend towards a new model of administrative cooperation based on theautomatic exchange of
information (AEoI), built through different bilateral and multilateral legal instruments.
To address the aforementioned problems, the European Union is actively supporting this global
trend towards greater transparency and administrative cooperation. Indeed, among the original
objectives of Directive 2011/16/EU (hereafter DAC or ‘the Directive’) was that of coordinating
Union legislation on administrative cooperation with the international drive towards strengthening
and enhancing the effectiveness of the EoIR.
2
Nonetheless, it soon became clear that the Directive
would have to be adapted to the new initiatives intended to bolster the AEoI as a future interna-
tional standard for transparency and exchange of information in tax matters. In this sense, the DAC
has been amended five times with the intention of improving transparency and administrative
cooperation through the automatic exchange of information to ensure correct assessment of taxes
in cross-border transactions and combat tax avoidance, tax evasion, aggressive tax planning and
harmful tax competition, thus safeguarding the proper functioning of the internal market. These
amendments have essentially introduced new reporting obligations, followed by the automatic
exchange of information between Member States related to financial accounts,
3
advance cross-
border tax rulings and advance pricing arrangements,
4
country-by-country reports filed by certain
multinational companies,
5
and cross-border tax arrangements.
6
At the time of writing, a new
1. European Commission, Europe’s moment: Repair and Prepare for the Next Generation, COM (2020) 456 final, p. 11.
2. [2011] OJ L 64/1. See recitals 4 and 5 of the Directive.
3. Council Directive 2014/107/EU of 9 December 2014 (DAC 2), [2014] OJ L 359/1.
4. Council Directive 2015/2376 of 8 December 2015 (DAC 3), [2015] OJ L 332/1.
5. Council Directive 2016/881 of 25 May 2016 (DAC 4), [2016] OJ L 146/1.
6. Council Directive 2018/822 of 22 May 2018 (DAC 6), [2018] OJ L 139/1 Furthermore, Council Directive 2016/2258 of
6 December 2016 (DAC 5), [2016] OJ L 342/1, amended DAC to permit access to anti-money-laundering information
715
Moreno Gonz´
alez
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