European Union: Prospectus Directive - damages

The Court of Justice of the European Union delivered judgment earlier this month in Bankia (Prospectus when securities are offered to the public or admitted to trading - Judgment) [2021] EUECJ C-910/19. A summary of the judgment has been published by the ICLR: see here. The Court of Justice held, to quote from the headnote of the ICLR summary, that: "an investor who had participated in an offer of securities in the context of which a prospectus had been published could legitimately rely on the information given in that prospectus and was, therefore, entitled to bring an action for damages, pursuant to article 6 of Parliament and Council Directive 2003/71/EC, on the grounds of the inaccuracy of that information, whether or not the prospectus was issued for that investor".

European Union: the Statutory Audit Directive - Article 22 - "Employment by audited entities of former statutory auditors or of employees of statutory auditors or audit firms"

The Court of Justice of the European Union delivered its judgment today in A (Company law - Statutory audit of annual and consolidated accounts - Judgment) [2021] EUECJ C-950/19. The case concerned - as its name suggests - the Statutory Audit Directive 2006/43/EC (as amended by Directive 2014/56/EU), more specifically Article 22a which imposes a time-based bar on a statutory auditor, or key audit partner, taking up a position with a former audit client. The court held that a position for the purposes of Article 22(a)(1)9a) would be regarded as being held from the point at which the employment contract was agreed and not from when the duties associated with the position had begun to be performed.

Europe: Advocate General finds ECB OMT programme compatible with EU law

Advocate General Cruz Villalón, in an opinion for the Court of Justice of the European Union in case C‑62/14, has advised that the European Central Bank's Outright Monetary Transaction programme is compatible, in principle, with EU law: see here. A summary of the opinion, which is not binding on the court, is available here (pdf).

Europe: Court of Justice opinions - taxing gains and combatting money laundering

The Court of Justice of the European Union gave judgment today in two cases concerning Spain. In the first, Commission v Spain (C-61/11), the court held that the immediate taxation of unrealised capital gains on the transfer of a company established in Spain of its assets or place of residence to another Member State amounted to a restriction on the freedom of establishment. In the second case, Jyske Bank Gibraltar Ltd v Administración del Estado (C-212/11), the court held that EU law did not preclude Spanish legislation under which credit institutions operating but not established in Spain were required to send directly to the Spanish authorities information necessary for combatting money laundering and terrorist financing. Press releases for both decisions are available: see, respectively, here (pdf) and here (pdf).

Europe: Court of Justice approves the European Stability Mechanism

The Court of Justice of the European Union has held that EU law does not preclude the conclusion and ratification of the Treaty establishing the European Stability Mechanism by the Member States in the euro zone: see here (pdf). A copy of the Treaty is available here (pdf).

Europe: insider trading - what is precise information?

Advocate General Mengozzi delivered his opinion in Markus Geltl v Daimler AG (Case C-19/11) last month and provided advice on the meaning of precise information for the purposes of Directive 2003/6/EC (the Market Abuse Directive) and Directive 2003/124/EC (implementing Directive 2003/6/EC): see here.

Europe: freedom of establishment and taxation

The Court of Justice of the European Union gave its opinion yesterday in National Grid Indus BV v Inspecteur van de Belastingdienst Rijnmond / kantoor Rotterdam (C‑371/10). A summary of the court's opinion is available here (pdf), from which this headline is taken: "EU law does not in principle preclude the charging of tax on unrealised capital gains relating to the assets of a company when it transfers its place of management to another Member State".

Europe: free movement of capital and the VW law

The European Commission has referred Germany to the Court of Justice of the European Union in respect of its failure to comply fully with the court's earlier decision - Commission v Germany (C-112/05) - regarding the so-called Volkswagen law: see here.

Gibraltar: proposed corporate tax changes constitute state aid

The Court of Justice of the European Union (Grand Chamber) gave its opinion today in Commission v Government of Gibraltar and United Kingdom: see here. A press summary is available here (pdf). The court decided that proposed changes to the taxation of companies in Gibraltar - the effect of which was that offshore companies would pay no tax - constituted state aid and were therefore incompatible with EU law. The court found that offshore companies enjoyed a selective advantage under the proposals which, in the court's view, was not the random consequence of the proposed regime: it was the inevitable consequence of the proposed bases of assessment (the number of employees and occupation of premises).

Europe: freedom of establishment and Austrian casinos

The European Court of Justice delivered its judgment yesterday in Case C-64/08 (Criminal proceedings against Ernst Engelmann). The case concerned Austrian legislation which gave the Federal Minister for Finance the power to grant concessions entitling their holders to operate casinos in Austria. The grant of these concessions was restricted to public limited companies with their seat in Austria.

Mr Engelmann, a German national, operated a couple of casinos in Austria without applying for a concession and was found guilty of unlawfully organising games of chance and fined €2000. He appealed to the Landesgericht Linz (Regional Court, Linz, Austria), which referred questions to the ECJ for a preliminary ruling, including whether the Austrian legislation was compatible with European Union Law on the freedom to provide services and freedom of establishment.

The ECJ held - see here (judgment) or here (press release, pdf) - that requiring the company's seat to be in Austria constituted a restriction on freedom of establishment contrary to EU Law: it discriminated against companies with seats in other Member States and prevented them from operating gaming establishments in Austria through an agency, branch or subsidiary. With regard to the argument that such a restriction was justified in the interests of preventing fraud and crime, the ECJ held that the blanket exclusion of companies with seats in other Member States was disproportionate: it went beyond what was necessary to combat crime.

Poland: European Commission refers Poland to the ECJ

The European Commission has referred Poland to the European Court of Justice because, in the Commission's view, the Polish Act on Special Powers of the Treasury and their Exercise in Companies of Special Importance for Public Order or Public Security (and two implementing ordinances) is contrary to the principle of free movement of capital and freedom of establishment under the EC Treaty. 

The Act grants the State special rights - including a right of veto in respect of important management decisions - in thirteen Polish companies in the copper ore mining, media/audiovisual, railway infrastructure, electricity, gas and petroleum, motor spirits and diesel oil sectors.  Further information is available here.