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ECJ Partly Annuls EU Decision on Belgian Coordination
Centers
Date: 22 June 2006
In Belgium v. European Commission and Forum 187 ASBL v.
European Commission (joined cases C-182/03 and C- 217/03) the
Court of Justice of the European Communities has partly annulled
Commission Decision 2003/757/EC, which required Belgium to close down
its coordination centers, because the decision did not provide
transitional measures. In European Commission v. EU Council (C-399/03) the
Court has annulled Council Decision 2003/531/EC on Belgian state aid
to some coordination centers because the EU Council could not validly
adopt the decision.
Belgian coordination centres are used by
multinationals to centralise their business activities and they enjoy
a tax break in Belgium in that they are not liable to corporate
income on their profits. They have come under scrutiny of the
European Commission and will be wound down. The ECJ confirmed that
the tax breaks contravene EU law, but it stated that it was
inconsistent to take away the tax breaks from coordination centres
that would lose their status before 2010, while it had been renewed
on a 10-year basis. Coordination centres can continue to
benefit from tax incentives until 2010.
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