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Tax Rulings and State Aid Qualification: Should Reality Matter?

Adrien Giraud, Sylvain Petit


Keywords: Tax Ruling, Selectivity, Advantage, Distortion of competition, Counterfactual

In its decisional practice developing tax ruling, the European Commission uses a theoretical reasoning that can in some instances appear somewhat disconnected from the facts of the cases. Indeed, all these cases boil down to one single determination (whether the concerned transfer prices were – or not – set at market levels) and the satisfaction of all the conditions for the existence of State aid derive directly from this (rather theoretical) question alone. Little to no account taken of important factual elements (such as for example the context of international fiscal competition) and several conclusions appear to be presumed rather than demonstrated (for example the distortion of competition). One therefore remains with the general impression that State aid law remains into a sort of exception to the rest of competition law: an area of law where reality does not (really) matter.
Keywords: Tax Ruling; Selectivity; Advantage; Distortion of Competition; Counterfactual.

Adrien Giraud, Partner at Willkie Farr & Gallagher LLP in Brussels; Sylvain Petit, Associate within Willkie Farr and Gallagher LLP in Brussels. This paper develops ideas first exposed at a conference organised by the Délégation des Barreaux de France on 9 December 2016 in Brussels. Adrien Giraud wishes to thank Mariana and Isabella Hariki for their invaluable help. The authors remain solely responsible for the content of this article. DOI: 10.21552/estal/2017/2/9


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