Newsletter - Landmark CJEU cases on abuse of the Parent-Subsidiary Directive (“PSD”) and Interest and Royalty Directive (“IRD”), and beneficial ownership


On 26 February 2019, the Court of Justice of the European Union (“CJEU”) delivered two decisions on certain joined cases, T Danmark (C-116/16 and C-117/16, the “PSD Cases”) and N Luxembourg 1 (C-115/16, C-118/16, C-119/16 and C-299/16, the “IRD Cases” and, jointly with the PSD Cases, the “Cases”), dealing with the concepts of abuse of law within the PSD and IRD, and beneficial ownership.

The Cases concerned the denial of the exemption from Danish withholding taxes (“WHTs”) on dividend and interest, granted by, respectively, the PSD and the IRD. Various fact patterns were put before the CJEU, but all involved EU parent companies entitled to PSD and IRD benefits, and ultimate companies up the control chain which were not.

See an analysis on the topic by our Tax Department