Luxembourg, 26 June 2025 — The Court of Justice of the European Union (CJEU) has dismissed the European Commission’s appeals in a long-running legal battle over Spain’s corporate tax rules, confirming the annulment of a 2014 Commission decision that found the rules to be unlawful State aid.
At issue was a Spanish tax scheme introduced in 2002 that allowed companies to deduct goodwill from their tax base when acquiring shareholdings in foreign companies. While the Commission initially accepted the scheme, it reversed course in 2009 and 2011, declaring the deductions for direct and indirect acquisitions to be illegal State aid.
In 2014, the Commission ruled that an extension of the scheme—allowing deductions for indirect acquisitions through foreign holding companies—constituted a new and incompatible State aid measure. It ordered Spain to recover the aid.
However, Spain and several multinational companies, including Banco Santander, Telefónica, Iberdrola, and Ferrovial, successfully challenged this decision at the General Court in 2023. The General Court found that the 2014 decision conflicted with the Commission’s earlier rulings, which had acknowledged legal protections for both direct and indirect acquisitions based on the principle of legitimate expectations.
The Commission appealed these judgments to the CJEU, which has now definitively upheld the General Court’s position. The CJEU ruled that the Commission could not reclassify the tax deductions for indirect acquisitions as a new aid scheme and reaffirmed the principle of legal certainty.
This decision marks the end of more than a decade of legal disputes surrounding Spain’s tax treatment of foreign shareholding acquisitions and reinforces limits on the Commission’s ability to retroactively redefine State aid.
For media inquiries, contact the CJEU Press and Information Unit at curia.europa.eu.
Source: https://curia.europa.eu/jcms/upload/docs/application/pdf/2025-06/cp250079en.pdf
