Danish cases on the use of holding companies for cross-border dividends and interest - A new test to disentangle abuse from real economic activity?

Susi Baerentzen*

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    Abstract

    This article provides a critical analysis of the rulings from the European Court of Justice in six Danish cases on the use of holding companies for cross-border dividends and interest, the so-called “Danish beneficial ownership cases”. The rulings are analysed in light of their unique facts and background to provide a better understanding of their outcome. In particular, the indications of abusive situations as provided by the Court are analysed in the light of economic theory in order to ascertain their meaning and effectiveness in disentangling abusive behaviour from valid business activity. Finally, this assessment is used to substantiate that the subjective element of the abuse test as developed by the Court has developed into an economic assessment to be based on everyday hallmarks of economic standards, rather than a legal assessment.

    OriginalsprogEngelsk
    TidsskriftWorld Tax Journal
    Vol/bind12
    Udgave nummer1
    Sider (fra-til)3-52
    Antal sider50
    ISSN1878-4917
    StatusUdgivet - feb. 2020

    Bibliografisk note

    Publisher Copyright:
    © 2020 International Bureau of Fiscal Documentation (IBFD). All right reserved.

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