France: European Commission Challenges French Transposition of Parent Subsidiary Directive
LuxCSD has been informed that the European Commission has launched infringement proceedings against France for incorrectly transposing the Parent‑Subsidiary Directive (Council Directive 2011/96/EU).
French legislation currently makes the exemption from withholding tax on dividends conditional upon the parent company’s "place of effective management" being located in an EU/EEA Member State. The European Commission considers this additional requirement to be incompatible with the Directive, which relies solely on tax residence as defined under the laws of the Member State.
France has been given a period of two months to amend its legislation or provide a satisfactory explanation. Failing this, the Commission may issue a reasoned opinion.
LuxCSD continues to monitor developments and will provide further updates as more information becomes available.
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