The Non-application of General Anti-avoidance Rules and State Aid Rules: Remarks on the CJEU Judgment in Engie

Abstract

In its judgment of 5 December 2023 in joined cases C-451/21 P and C-454/21 concerning transactions made within the group of Engie companies, the CJEU restricted the Commission’s powers to interpret national legal provisions of Member States as regards the review on state aid, stating that such an interpretation cannot refrain from the interpretation made by tax authorities and jurisprudence of the Member States. The case in question concerned (1) the attempt to defer from the literal wording of the national tax law provisions and the use of purposive interpretation, which could not be conferred from the wording of the provisions in question as well as from other administrative acts in setting the “reference framework” for the purpose of the application of provision on state aid; and (2) the attempt to interpret the national provisions on the abuse of law in isolation from their interpretation made by tax authorities and jurisprudence. Although certain limits within the state aid review procedure had been conferred on the Commission, the CJEU’s judgment did not disregard the possibility to review the non-application of the provisions on the abuse of tax law (GAAR) concerning the conformity of their application with the EU provisions on state aid.