ECLI:EU:C:2026:503

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OPINION OF ADVOCATE GENERAL

RICHARD DE LA TOUR

delivered on 18 June 2026 (1)

Case C‑241/25

Société Générale SA

Skatteverket

(Request for a preliminary ruling from the Högsta förvaltningsdomstolen (Supreme Administrative Court, Sweden))

( Reference for a preliminary ruling – Tax legislation – Taxation of dividends – Article 63 TFEU – Free movement of capital – Withholding tax on nationally sourced dividends received by non-resident companies – Loss-making non-resident recipient – Objectively comparable situation – Requirement to calculate profit or loss in accordance with the rules of the source State )

I. Introduction

1. By this request for a preliminary ruling, the Court is asked to rule on the following issue, which has been raised by practitioners and academic legal writers since the judgment of 22 November 2018, Sofina and Others, (2) confirmed by the judgment of 19 December 2024, Credit Suisse Securities (Europe): (3) how should the loss claimed by a non-resident company receiving dividends and wishing to be treated in the same way as a loss-making resident company in the Member State in which the dividends are paid (4) be calculated? Should that calculation be made in accordance with the rules of the source State or with those of the Member State of residence of the non-resident company? (5)

2. The Court has held that Article 63 TFEU precluded the legislation at issue in the cases which gave rise to those two judgments, under which the taxation of dividends received in a source State by loss-making non-resident companies was subject to withholding tax constituting immediate and definitive taxation, whereas dividends received by loss-making resident companies benefited either from a deferral of taxation until a return to profitability (the case giving rise to the judgment in Sofina) or from full reimbursement if the result for the tax year was a loss (the case giving rise to the judgment in Credit Suisse Securities), which constituted, in both cases, a cash-flow advantage or even a total exemption in the event of that company ceasing trading before a profit was again achieved.

3. In the present case, the Högsta förvaltningsdomstolen (Supreme Administrative Court, Sweden) asks whether requiring a recalculation of the loss in accordance with the rules of the source State, in order for a loss-making non-resident company receiving dividends to benefit from the same treatment as a loss-making resident company, is contrary to the free movement of capital provided for in Article 63 TFEU. I shall propose that the Court should answer in the affirmative.

II. Legal framework

A. International law

4. Article 10 of the Agreement between the Government of the French Republic and the Government of the Kingdom of Sweden for the Avoidance of Double Taxation and the Prevention of Tax Evasion in respect of Taxes on Income and Wealth (6) provides:

‘1. Dividends from a company resident in one contracting State to a person resident in the other contracting State are taxable in the latter State.

2. Those dividends may also be taxed in the contracting State in which the company paying the dividends is resident, under the legislation of that State, but if the recipient of the dividends is the person actually entitled to them, the tax thus levied may not exceed 15% of the gross amount of the dividends. …

…’

B. Swedish law

1. The provisions governing dividend tax

5. The provisions governing the dividend tax are set out in the kupongskattelagen (Law on dividend tax) (7) of 20 November 1970, in the version applicable to the dispute in the main proceedings.

6. According to the first subparagraph of Paragraph 1 of that law, dividend tax must be paid to the State for any distribution of dividends on shares in a Swedish limited company.

7. In accordance with the first subparagraph of Paragraph 4 of that law, non-resident legal persons who are entitled to dividends are liable for the tax, if the dividends paid are not attributable to revenue from an economic or commercial activity carried out through a permanent establishment operating in Sweden.

8. Paragraph 5 of the Law on dividend tax provides that the rate of dividend tax is to be 30% of the dividends distributed. Under Paragraph 27 of that law, however, there is a right to reimbursement in some situations. It is clear from the first subparagraph of that paragraph that, if dividend tax has been deducted in an amount higher than that payable under a convention for the avoidance of double taxation, the recipient is entitled to reimbursement of the excess amount deducted.

9. Paragraphs 28 to 28n of that law, which entered into force on 1 January 2020, (8) provide for a deferral of payment of dividend tax in certain cases. Those rules allow a non-resident legal person established in the European Union to obtain, upon application, a period of deferral of payment of dividend tax. In essence, a deferral is to be granted provided that the non-resident legal person recorded a loss calculated in accordance with the Swedish tax rules. If the company applying for a deferral forms part of a group of undertakings subject to consolidated taxation of revenue in the State in which it is established, the extent of the deferral is to be calculated by reference to all the undertakings belonging to the group.

2. The provisions governing income tax

10. Paragraphs 3 and 4 of Chapter 6 of the inkomstskattelagen (Law on income tax) (9) of 16 December 1999, in the version applicable to the main proceedings, provides, as a general rule, that Swedish legal persons are taxable on all their revenues in Sweden and from abroad.

11. Pursuant to the first subparagraph of Paragraph 1 of Chapter 16 of that law, they may, in principle, deduct, as an expense, costs incurred for the acquisition and maintenance of revenue.

12. The Law on income tax contains no rules on consolidated taxation. Undertakings in a group may, however, if certain requirements are met, balance the results within a group by making intra-group transfers pursuant to Chapter 35 of that law.

13. It follows from the first subparagraph of Paragraph 1 of Chapter 35 of that law that the transfer is deductible by the transferor and is taxable in the hands of the recipient.

III. The facts in the main proceedings and the questions referred for a preliminary ruling

14. Société Générale SA (‘SG’) is a French company which is resident for tax purposes in France and forms part of a tax group which is subject to consolidated taxation in France.

15. In 2012, a withholding tax was levied on dividends received by SG from Swedish companies, in the form of Swedish dividend tax. The Swedish tax authorities rejected SG’s application for reimbursement of the tax withheld from SG, on the basis that the withholding tax constituted a restriction on the free movement of capital, even though SG was loss-making and a loss-making Swedish company would not have been taxed on those dividends.

16. On appeal by SG, both the Förvaltningsrätten i Falun (Administrative Court, Falun, Sweden) and the Kammarrätten i Sundsvall (Administrative Court of Appeal, Sundsvall, Sweden) rejected SG’s claims on the ground that the French tax declaration forms submitted by SG and the group to which it belongs did not make it possible to rule with sufficient certainty that SG made a loss in the year in question, which could have been established only by a more detailed calculation of SG’s and group’s profits or losses in accordance with Swedish law.

17. At the current stage of the proceedings, SG’s appeal in cassation has been granted on the question whether a non-resident legal person is in a position objectively comparable to the position of a Swedish legal person which recorded losses in terms of taxation of income, for the purpose of ruling on whether a withholding tax on dividends is compatible with the FEU Treaty.

18. The Högsta förvaltningsdomstolen (Supreme Administrative Court) asks whether a source State may require a non-resident company, which requests reimbursement of a dividend tax withheld at source on the ground that it is loss-making, to show that it is also loss-making when its results are calculated in accordance with the tax rules of the source State. Where appropriate, the referring court considers that a further question arises as to taking into account the results of the tax group as a whole when assessing whether the company is loss-making, although the source State does not provide for consolidated taxation but lays down rules only on intra-group transfers which, in certain circumstances, make profit and loss compensation within the group possible.

19. In those circumstances, the Högsta förvaltningsdomstolen (Supreme Administrative Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) Is it compatible with Article 63 [TFEU] for a State of taxation at source to require a non-resident company, which is subject to taxation at source on dividends and which claims that it is in a situation that is objectively comparable to that of a resident loss-making company, to show that circumstance by recalculating its taxable profit or loss in accordance with the rules applied by the State of taxation at source to taxation on the revenue of resident companies?

(2) If the non-resident company is subject to consolidated taxation, is it compatible with Article 63 TFEU for a State of taxation at source to require the profit or loss of the tax group as a whole to be taken into account when determining whether the company is in a situation that is objectively comparable to that of a resident loss-making company?

(3) Is the reply to [the second question] affected if the State of taxation at source does not have rules on consolidated taxation but by contrast does have rules on intra-group transfers which, in certain circumstances, make profit and loss compensation within the group possible?’

20. The Federal Republic of Germany has requested, pursuant to the third paragraph of Article 16 of the Statute of the Court of Justice of the European Union, that those questions be examined by the Court sitting as the Grand Chamber.

21. Written observations were submitted by SG, the Skatteverket (Swedish tax authority), the Swedish and German Governments and the European Commission. Those parties and the Spanish Government presented oral arguments at the hearing held on 10 February 2026.

IV. Analysis

22. By its questions, which I propose to deal with together, the referring court asks the Court to clarify its case-law arising from the judgments in Sofina and in Credit Suisse Securities. It asks whether it is possible for the State in which dividends are paid to a company having its registered office in another Member State and forming part of an integrated tax group in that State of residence to require that the loss claimed by that company be proven by a calculation in accordance with its own tax rules in order to establish that the non-resident company is in a situation comparable to that of a loss-making resident company and thus to benefit from the possibility of a deferral of taxation. Moreover, it asks whether, in determining whether the tax situation of a non-resident company is comparable to that of a loss-making resident company, account must be taken of the results of the tax group to which it belongs or only of its own results where the source State has no tax consolidation rules, but only rules relating to intra-group transfers which, in certain circumstances, make profit and loss compensation within the group possible.

A. The guidance which can be derived from the judgments in Sofina and in Credit Suisse Securities

23. In the judgment in Sofina, the Court ruled on facts and legislation very similar to those in the present case, that is to say the tax authorities’ refusal to reimburse the withholding tax levied on dividends received by a loss-making non-resident company, whereas a resident company is taxed for the current year only if it is profit-making.

24. In the first place, the Court held that the legislation at issue was liable to procure an advantage for loss-making resident companies (a cash-flow advantage, or even an exemption in the event of that company ceasing trading), whereas non-resident companies were subject to immediate and definitive taxation irrespective of their results. (10)

25. In the second place, the Court examined whether there was any justification for the restriction on the free movement of capital found to exist.

26. To that end, it first rejected the justification based on the objective comparability of the situations (11) put forward by the Belgian, German, French and United Kingdom Governments, relying on the judgment of 22 December 2008, Truck Center. (12) Those governments considered that the various arrangements for the collection of tax on the basis of the location of the registered offices of the recipient company of the dividends were justified on account of a difference in the objective situation. (13) After pointing out that that judgment had accepted a difference in treatment resulting from the application of different taxation arrangements on the basis of the place of residence, the Court recalled that, in that judgment, it had held that, in any event, the income at issue had been subject to tax irrespective of whether it was received by a resident or non-resident company. (14) It then held that, since the legislation at issue in the case giving rise to the judgment in Sofina conferred a substantial tax advantage for loss-making resident companies, it could not be claimed that the difference in treatment was restricted to the arrangements for the collection of tax. (15)

27. Next, the Court rejected the justification based on the balanced allocation of powers of taxation between the Member States on the ground that, if the scheme applicable to loss-making resident companies were also applied to non-resident companies, the risk of tax losses would be the same in respect of both types of companies if they did not return to profitability before ceasing trading and that, in the case in point, the government had accepted such a loss in respect of resident companies. (16)

28. Finally, the Court also rejected the argument based on the effectiveness of tax collection, because the deferral of taxation in the event of a loss-making year would apply only to a limited number of non-resident companies, those companies would be required to provide the relevant evidence to the tax authorities of the source State to determine that the statutory conditions had been met and those tax authorities could make use of mutual assistance mechanisms to check the accuracy of that evidence. The Court concluded from this that the restriction on the free movement of capital resulting from the national legislation in question went beyond what is necessary to achieve the objective of ensuring the collection of tax. (17) Consequently, a simple deferral of taxation on dividends also granted to loss-making non-resident companies would be sufficient to achieve the objectives pursued whilst eliminating the restrictions on the free movement of capital. (18)

29. In the judgment in Credit Suisse Securities, the Court reproduced that reasoning, applying it to a scenario in which reimbursement of the withholding tax on the dividends paid to a non-resident company was refused, whereas a loss-making resident company is entitled to reimbursement of such tax withheld at source. The Court clarified two matters. In the first place, the Court rejected the arguments of the Diputación Foral de Bizkaia (Provincial Council of Biscay, Spain) and of the German and Spanish Governments concerning the objective non-comparability of the situations resulting from the principle of territoriality and based on the judgments of 15 May 1997, Futura Participations and Singer; (19) of 15 February 2007, Centro Equestre da Lezíria Grande; (20) and of 17 September 2015, Miljoen and Others, (21) which predate the judgment in Sofina. (22) To that end, it recalled that the judgment in Sofina had already rejected that argument on the basis of settled case-law resulting, in particular, from the judgment of 17 September 2015, Miljoen and Others. (23) In the second place, the Court examined the justification based on the balanced allocation of powers of taxation between the Member States and the prevention of the risk of losses being used twice. (24) In that regard, the Court recalled that the prevention of the double use of losses constituted a legitimate objective capable of justifying a restriction on fundamental freedoms (25) and that non-resident companies were required to provide the relevant evidence to enable the tax authorities of the source State to determine that the conditions laid down in order for those companies to benefit from a deferral of taxation had been met. (26)

B. The criticisms and questions raised by that case-law

30. In the first place, the German Government, supported at the hearing by the Spanish Government, considers that what is at issue is not so much the question of proof of the losses to be taken into account when calculating the amount of tax withheld at source to be reimbursed, but the question of the principle of taking into account losses incurred outside the source State.

31. That government does not dispute the unequal treatment in the light of the free movement of capital resulting from the Swedish legislation, which does not allow for the deferral of taxation if a non-resident company is in a loss-making situation, but it does dispute the objective comparability of the situations, relying on judgments, in particular those of the Grand Chamber, which cannot be called into question by the judgments in Sofina and in Credit Suisse Securities.

32. Accordingly, the German Government recalls that the principle of tax territoriality has been recognised, in particular, by two Grand Chamber judgments. (27) It follows that a taxation system under which, for the purposes of the calculation of the tax base of non-resident taxpayers in a given Member State, only the profits and losses arising from their activities in that State are taken into account is consistent with that principle. That government adds that, according to that case-law, resident and non-resident taxpayers are in a comparable situation only with regard to costs having a direct economic connection with the taxable income in the State in which the activity is carried out. (28) Those criticisms of the judgments in Sofina and in Credit Suisse Securities are also put forward by some practitioners. (29)

33. Among the latter, some have referred to the risk of fraud as well as the issue of the geographical and fiscal scope of the case-law arising from the judgment in Sofina. Others have mentioned attempts by practitioners to restrict the scope of that case-law by requiring the loss-making non-resident company to calculate that loss in accordance with the rules of the source State, which is the case under Swedish law, unlike, for example, French law, which was at issue in the case which gave rise to the judgment in Sofina. (30) Finally, some have expressed concerns as to the limitation imposed by bilateral tax conventions, which allow source States to tax only dividends and not the entirety of the income of a non-resident company which has returned to profitability. (31)

C. Criticisms and surmountable practical problems

34. I consider that each of those criticisms or practical difficulties can be overcome.

35. In the first place, I note that the judgments on which the German Government bases its arguments regarding compliance with the principle of tax territoriality relate only to situations in which there is genuine economic activity within the territory of the source State (a branch or subsidiary of a non-resident company, or the provision of services). Consequently, that case-law is not applicable where, as in the present case, there is no economic activity in the source State and the income is therefore ‘passive’. However, in the judgment of 17 September 2015, Miljoen and Others, (32) the facts concerned the taxation of dividends paid to non-resident companies and the Court ruled that only business expenses which are directly linked to an activity that has generated taxable income in a Member State could be deducted from the basis of assessment of the tax payable in the source State, since residents and non-residents of that State are in a comparable situation, with the result that legislation of that State which denies non-residents, in matters of taxation, the right to deduct such expenses, while, on the other hand, allowing residents to do so, risks operating mainly to the detriment of nationals of other Member States and therefore constitutes indirect discrimination on grounds of nationality. (33) Nevertheless, all the cases which gave rise to those judgments concerned the determination of the basis of assessment of the tax and not the date of payment or reimbursement of that tax, as in the cases which gave rise to the judgments in Sofina and in Credit Suisse Securities. Consequently, those judgments are not contrary to the case-law referred to by the German Government. Furthermore, they follow a well-established line of case-law which has held that, as soon as a Member State, either unilaterally or by way of a convention, imposes a charge to tax on the income, not only of resident shareholders, but also of non-resident shareholders, from dividends which they receive from a resident company, the situation of those non‑resident shareholders becomes comparable to that of resident shareholders. (34) Accordingly, the issue of comparability arises at the stage of justifying the restriction on the free movement of capital.

36. Advocate General Mengozzi summarised very well the difficulty at the heart of the German Government’s arguments regarding comparability. In a case concerning a restriction on the free movement of workers resulting from a tax rule, he stated that ‘since discrimination can arise only through the application of different rules to comparable situations, … it seems inappropriate to say the least, for the purposes of examining the objective comparability of situations, to take as the assessment criterion the national and/or treaty rules at the origin of the difference in treatment, where the Court is in fact being called upon to determine whether those rules are discriminatory’, since this would amount to circular reasoning. (35) The Court adopted that analysis to reject the German Government’s argument, in a situation converse to that at issue in the present case, in accepting the comparability of the situation of a company holding shares in a resident company and the situation of a company holding shares in a non-resident company. It held that ‘the application of different taxation systems to a resident company depending on whether it has holdings in resident or non-resident companies cannot be a valid criterion for assessing the objective comparability of their situations and, therefore, for identifying an objective difference between them. It is precisely the application of different taxation systems that is responsible for the difference in treatment, in respect of which it must be assessed whether it is justified or not’. (36)

37. In the second place, as regards the risk of fraud, it suffices to recall, on the one hand, the existence in EU law of a general legal principle that EU law cannot be relied on for abusive or fraudulent ends, (37) in particular in the field of taxation. (38) On the other hand, Directive (EU) 2016/1164 (39) contains, in Article 6 thereof, a general anti-abuse clause. Moreover, in practice, the risk of tax evasion and tax avoidance is much more limited where the shareholding in a company is small.

38. In the third place, as regards the method of calculating the loss-making situation of the non-resident company receiving dividends to be taken into account in order for it to benefit from the same rule as resident companies, namely the option not to pay the dividend tax if it is in a loss-making situation, (40) the issue must be considered from the perspective of the administrative burden which is placed on the non-resident company, and the proportionality of which must be assessed, and not from the perspective of comparability. Whilst holding that it is the duty of non-resident companies to provide relevant evidence to allow the tax authorities of the source State to determine that the statutory conditions for benefiting from a deferral of taxation have been met, (41) the Court limited that burden of proof to compliance with the principles of proportionality and effectiveness. Accordingly, it held in particular that:

– proof of the amount of the losses which a taxpayer sought to carry forward may not be limited to the proof required by the legislation of the source State; (42)

– legislation of a Member State which indiscriminately prevents taxpayers from adducing evidence which satisfies criteria other than those laid down by its legislation, goes beyond what is necessary to guarantee the effectiveness of fiscal supervision and the effective collection of tax, (43) and

– the evidence required should enable the tax authorities of the Member State of taxation to ascertain, clearly and precisely, whether the conditions for obtaining a tax advantage are met, but it does not need to take any particular form and the assessment must not be conducted too formalistically. (44)

39. In the fourth place, the questions relating to the geographical and fiscal scope of the case-law arising from the judgment in Sofina go beyond the examination of the questions raised by the referring court, which concern only the taxation of dividends received by a non-resident company from a company in which its capacity is solely that of an investor. I consider that that scope must be considered not on the basis of geographical or fiscal criteria, but in the context of the freedoms of establishment or movement. However, I note that the German Government wishes to see a further discussion of the case-law arising from the judgment of 13 December 2005, Marks & Spencer, (45) on the taking into account of losses in the source State in the context of relationships between parent companies and subsidiaries, in other cases before the Court. (46)

40. In the fifth place, some authors (47) have taken the view that double taxation conventions could limit the temporal scope of tax recovery. Under bilateral tax conventions, source States are authorised to levy tax solely on distributed dividends, and not on the profits of non‑resident companies arising from other activities. It will, however, fall to source States to distinguish subsequently between the recovery of the initial tax and the imposition of a new charge.

D. Confirmation of the case-law arising from the judgments in Sofina and in Credit Suisse Securities

41. It follows from the foregoing that the issue of comparability must be considered after examining the existence of a restriction on the free movement of capital and that, consequently, the second and third questions are to be dealt with in that context. Accordingly, the Court has the opportunity to confirm the case-law arising from the judgments in Sofina and in Credit Suisse Securities.

42. In the first place, as regards the existence of a restriction on the free movement of capital, the measures prohibited by Article 63(1) TFEU, as restrictions on the movement of capital, include those which are such as to discourage non-residents from making investments in a Member State or to discourage that Member State’s residents from doing so in other States. (48) Accordingly, the less favourable treatment by a Member State of dividends paid to non-resident companies, compared to the treatment of dividends paid to resident companies, is liable to deter companies established in a Member State other than that first Member State from undertaking investments in that same first Member State and, consequently, amounts to a restriction of the free movement of capital, prohibited, in principle, under Article 63 TFEU. (49) The Court held, in the judgment in Sofina, that this was the case where a resident company receiving dividends was not taxed on those dividends in the year in which it made a loss, whereas dividends received by a loss-making non-resident company were subject to definitive and automatic taxation by means of a withholding tax. It added that such a rule is liable to procure an advantage for loss-making resident companies, since it gives rise, at the very least, to a cash-flow advantage, or even an exemption, whereas non-resident companies are subject to immediate and definitive taxation irrespective of their results. (50) It explained, in the judgment in ACC Silicones, that that restriction could also exist where the possibility of reimbursement of the withholding tax on dividends paid to non-resident companies established in other Member States was subject to additional conditions as against those laid down for the reimbursement of the withholding tax levied on dividends paid to resident companies, which had the effect of making it more difficult for non-resident companies to exercise the right to reimbursement. (51)

43. The restriction on the free movement of capital is not disputed by any of the parties in the present case. It arises not only from the fact that, at the material time, no option to defer taxation was available to loss-making non-resident companies, but also from the legislation adopted to take account of the rule in Sofina and applicable from 1 January 2020. In order to benefit from a deferral of the taxation of dividends withheld at source, a loss-making non-resident company must prove that it is in a loss-making situation in accordance with the Swedish rules. Such a difference in treatment is liable to discourage non-resident companies from investing in companies established in Sweden.

44. Moreover, it should be recalled that, in accordance with Article 65(1) TFEU, such a difference in treatment is permissible only if it relates to situations which are not objectively comparable or if it is justified by an overriding reason in the public interest. (52)

45. In the second place, as regards the comparability of the situations at issue, I have previously explained why the reasoning of the German and Spanish Governments cannot be accepted on that point and that the examination of that comparability cannot precede the examination of the restriction on the free movement of capital. (53) Moreover, I would point out that, according to the Court’s case-law, as soon as a Member State, either unilaterally or by way of a convention, imposes a charge to tax on the income not only of resident companies but also of non-resident companies from dividends which they receive from a resident company, the situation of the non-resident companies becomes comparable to that of resident companies. (54)

46. The judgment in Sofina established that the possibility of a deferral of taxation, or even an exemption in the event of that company ceasing trading in the absence of a return to profitability, was not restricted to the arrangements for the collection of tax, but procures a substantial advantage for loss-making resident companies. (55)

47. In the present case, the difficulty concerning comparability stems from the fact that, in order to benefit from that deferral of taxation, loss-making non-resident companies must establish that loss in accordance with the rules of Swedish tax law, which entails an additional administrative burden for non-resident companies and amounts to treating them in the same way as resident companies. Such treatment goes beyond the objective comparability required by the case-law.

48. Moreover, like the Commission, I consider that the second and third questions referred for a preliminary ruling are hypothetical in so far as it is not disputed that both SG and the consolidated group of which it is the parent company were loss-making for the financial year in question. In any event, in so far as the tax rules are not harmonised in this field, it is appropriate to take into account only the loss-making position of the company receiving the dividends, except in cases of fraud.

49. In the third place, as regards the justification for the restriction on the free movement of capital, the referring court mentions none. The tax authorities refer to the risk of tax planning only in relation to the second and third questions; this could cover the risks of fraud and the balanced allocation of powers of taxation between the Member States. As for the Swedish Government, it relies, as overriding reasons in the public interest, on the balanced allocation of powers of taxation between the Member States, the safeguarding of the cohesion of the tax system and the combating of tax avoidance, which have been accepted by the Court’s case-law in certain circumstances. In any event, the Court requires, in order to permit a restriction on fundamental freedoms, that it be justified by an overriding reason in the public interest, be appropriate for securing the attainment of the objective pursued and not go beyond what is necessary in order to attain it. (56)

50. First, the balanced allocation of powers of taxation between the Member States was not accepted in the situation which led to the judgment in Sofina. The Court held that, on the one hand, a simple deferral of the taxation on dividends did not constitute a waiver by the source State of its right to tax those dividends generated within its territory and that, on the other hand, in the event of the non-resident company ceasing trading before returning to profit, the resulting tax losses could not justify the restriction on the free movement of capital, in particular since the source State allowed such losses with respect to resident companies. (57)

51. In the present case, the same reasoning may be adopted since the calculation of the non-resident company’s loss does not alter the basis of assessment of the tax payable, but alters only the date on which it becomes payable.

52. Secondly, the argument regarding the safeguarding of fiscal cohesion was rejected in the judgment in Credit Suisse Securities on the ground that, in order for such an argument to succeed, according to settled case-law a direct link must be established between the tax advantage concerned and the offsetting of that advantage by a particular tax levy. (58) However, in the present case, the advantage to resident companies resulting from the deferral of taxation, or even from exemption, is not offset by a specific tax levy. Consequently, that justification cannot be accepted.

53. Thirdly, the Swedish Government alleges a risk of tax avoidance on the ground that shareholdings, and the associated right to dividends, could be transferred to a loss-making non-resident company acquired for that specific purpose. Whilst that justification may be accepted, it is subject to the condition that it complies with the principle of proportionality. (59) In the present case, in addition to the arguments set out in point 37 of this Opinion concerning the existence of legislative and case-law principles combating fraud and the low risk in cases in which the shareholding is dispersed, I consider that the measure requiring the loss to be calculated in accordance with Swedish tax rules is disproportionate to the objective pursued. Such a requirement is based on a principle of generalised suspicion of fraud and not on evidence suggesting that fraud or an artificial arrangement intended to avoid payment of dividend tax is at issue. (60) Moreover, in the light of the administrative burden it would place on the non-resident company, in particular if the latter has investments in many Member States, that requirement could undermine the principle of the effectiveness of the free movement of capital. Therefore, the cost of that administrative burden could exceed the amount of tax in question. By contrast, accepting proof of a loss calculated in accordance with the rules of the non-resident company’s State of residence, combined with the possibility for the tax authorities to benefit from mutual assistance and support from their counterparts under Directive 2011/16/EU, (61) would be sufficient to achieve the objective of combating tax evasion and tax avoidance, while enabling the source State to verify that the condition that the non-resident company receiving dividends must be loss-making has been met in accordance with the rules of the State of residence.

54. As a supplementary point, concerning the justification put forward by the German Government based on the prevention of the risk of losses being used twice, I would point out that the Court has held that it is for non-resident companies to provide the relevant evidence to enable the tax authorities of the source State to determine that the conditions laid down in order for those companies to benefit from a deferral of taxation have been met. (62)

55. Consequently, I propose that the answer to the referring court should be that Article 63 TFEU must be interpreted as precluding legislation of a Member State under which a non-resident company receiving dividends subject to withholding tax must, in order to benefit from the same treatment as that provided for resident companies receiving dividends and in a loss-making situation, calculate its loss in accordance with the tax rules of the source State.

V. Conclusion

56. In the light of the foregoing, I propose that the Court should answer the questions referred for a preliminary ruling by the Högsta förvaltningsdomstolen (Supreme Administrative Court, Sweden) as follows:

Article 63 TFEU must be interpreted as precluding legislation of a Member State under which a non-resident company receiving dividends subject to withholding tax must, in order to benefit from the same treatment as that provided for resident companies receiving dividends and in a loss-making situation, calculate its loss in accordance with the tax rules of the Member State in which the dividends are paid.

1 Original language: French.

2 C‑575/17, ‘the judgment in Sofina’, EU:C:2018:943.

3 C‑601/23, ‘the judgment in Credit Suisse Securities’, EU:C:2024:1048.

4 ‘The source State’.

5 ‘The State of residence’.

6 Signed in Stockholm on 27 November 1990.

7 SFS 1970, No 624.

8 Those provisions were not yet in force at the time of the facts of the main proceedings.

9 SFS 1999, No 1229.

10 See the judgment in Sofina (paragraph 34).

11 See the judgment in Sofina (paragraphs 47 to 54).

12 C‑282/07, EU:C:2008:762.

13 See the judgment in Sofina (paragraph 48).

14 See the judgment in Sofina (paragraph 51).

15 See the judgment in Sofina (paragraph 53).

16 See the judgment in Sofina (paragraphs 55 to 64).

17 See the judgment in Sofina (paragraphs 65 to 78).

18 See the judgment in Sofina (paragraph 77).

19 C‑250/95, EU:C:1997:239.

20 C‑345/04, EU:C:2007:96.

21 C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608.

22 See the judgment in Credit Suisse Securities (paragraphs 53 to 56).

23 C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608. See the judgment in Sofina (paragraph 47, citing the judgments of 20 October 2011, Commission v Germany (C‑284/09, EU:C:2011:670, paragraph 56), and of 17 September 2015, Miljoen and Others (C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608, paragraph 67 and the case-law cited)).

24 See the judgment in Credit Suisse Securities (paragraphs 68 to 78).

25 See the judgment in Credit Suisse Securities (paragraph 72 and the case-law cited).

26 See the judgment in Credit Suisse Securities (paragraph 77).

27 See judgments of 15 May 1997, Futura Participations and Singer (C‑250/95, EU:C:1997:239, paragraph 22), and of 13 December 2005, Marks & Spencer (C‑446/03, EU:C:2005:763, paragraph 39). See, also, judgment of 15 February 2007, Centro Equestre da Lezíria Grande (C‑345/04, EU:C:2007:96).

28 See judgment of 15 February 2007, Centro Equestre da Lezíria Grande (C‑345/04, EU:C:2007:96, paragraphs 23 and 24).

29 See CFE tax advisers Europe, ‘Opinion Statement ECJ-TF 3/2019 on the CJEU decision of 22 November 2018 in Case C‑575/17, Sofina, on withholding taxes, losses and territoriality’, available at the following internet address: https://taxadviserseurope.org/new_ahgency/wp-content/uploads/2019/10/ECJ-TF_3-2019_Sofina_FINAL.pdf, paragraphs 19 and 20.

30 See Dassesse, M., ‘L’arrêt Sofina’, Journal de droit fiscal, Bruylant, Brussels, 2018, pp. 5 to 30, in particular Section 3.2 (pp. 25 and 26).

31 See CFE tax advisers Europe, ‘Opinion Statement ECJ-TF 3/2019 on the CJEU decision of 22 November 2018 in Case C‑575/17, Sofina, on withholding taxes, losses and territoriality’, op. cit., paragraph 29.

32 C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608.

33 See the judgment of 17 September 2015, Miljoen and Others (C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608, paragraphs 57 to 61).

34 See judgments of 12 December 2006, Test Claimants in Class IV of the ACT Group Litigation (C‑374/04, EU:C:2006:773, paragraph 68); of 14 December 2006, Denkavit Internationaal and Denkavit France (C‑170/05, EU:C:2006:783, paragraph 35); and of 17 September 2015, Miljoen and Others (C‑10/14, C‑14/14 and C‑17/14, EU:C:2015:608, paragraph 67 and the case-law cited).

35 See Opinion of Advocate General Mengozzi in Renneberg (C‑527/06, EU:C:2008:362, point 70).

36 See judgment of 22 January 2009, STEKO Industriemontage (C‑377/07, EU:C:2009:29, paragraph 33).

37 See judgment of 26 February 2019, N Luxembourg 1 and Others (C‑115/16, C‑118/16, C‑119/16 and C‑299/16, EU:C:2019:134, paragraph 96).

38 See judgment of 26 February 2019, N Luxembourg and Others (C‑115/16, C‑118/16, C‑119/16 and C‑299/16, EU:C:2019:134, paragraph 109).

39 Council Directive of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ 2016 L 193, p. 1).

40 The deferral of taxation where a company is in a loss-making situation was incorporated into Swedish law only after the judgment in Sofina and was therefore not applicable at the time of the facts in the present case.

41 See the judgment in Sofina (paragraph 72).

42 See judgment of 15 May 1997, Futura Participations and Singer (C‑250/95, EU:C:1997:239, paragraph 40).

43 See judgment of 27 November 2025, Santander Renta Variable España Pensiones, Fondo de Pensiones (C‑525/24, EU:C:2025:922, paragraph 66 and the case-law cited).

44 See judgment of 15 September 2011, Accor (C‑310/09, EU:C:2011:581, paragraph 99 and the case-law cited).

45 C‑446/03, EU:C:2005:763.

46 See, in particular, the joined cases of OPmobility (C‑287/25), Société Générale (C‑288/25) and Société Générale (C‑289/25), currently pending, in which the Court will examine the possibility of offsetting the losses incurred by a non-resident subsidiary against the overall results of the integrated tax group of which it is the parent company and the criteria laid down in the judgment of 13 December 2005, Marks & Spencer (C‑446/03, EU:C:2005:763).

47 See, in particular, CFE tax advisers Europe, ‘Opinion Statement ECJ-TF 3/2019 on the CJEU decision of 22 November 2018 in Case C‑575/17, Sofina, on withholding taxes, losses and territoriality’, op. cit., paragraph 29.

48 See the judgment in Sofina (paragraph 23 and the case-law cited); judgment of 16 June 2022, ACC Silicones (C‑572/20, ‘the judgment in ACC Silicones’, EU:C:2022:469, paragraph 31); and Credit Suisse Securities (paragraph 30).

49 See the judgments in Sofina (paragraph 24 and the case-law cited) and in Credit Suisse Securities (paragraph 31).

50 See the judgments in Sofina (paragraph 34) and in Credit Suisse Securities (paragraph 42).

51 See the judgment in ACC Silicones (paragraph 34).

52 See the judgments in Sofina (paragraph 46 and the case-law cited) and in ACC Silicones (paragraph 37 and the case-law cited).

53 See points 35 and 36 of this Opinion

54 See the judgments in Sofina (paragraph 47 and the case-law cited) and in ACC Silicones (paragraph 40 and the case-law cited).

55 See the judgment in Sofina (paragraphs 52 and 53).

56 See the judgment in ACC Silicones (paragraph 51 and the case-law cited).

57 See the judgment in Sofina (paragraphs 55 to 64 and the case-law cited).

58 See the judgment in Credit Suisse Securities (paragraph 80 and the case-law cited).

59 See judgment of 10 February 2011, Haribo Lakritzen Hans Riegel and Österreichische Salinen (C‑436/08 and C‑437/08, EU:C:2011:61, paragraphs 69 and 70 and the case-law cited).

60 See judgment of 31 May 2018, Hornbach-Baumarkt (C‑382/16, EU:C:2018:366, paragraph 49).

61 Council Directive of 15 February 2011 on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC (OJ 2011 L 64, p. 1).

62 See the judgment in Credit Suisse Securities (paragraph 77).

Opinion of Advocate General Richard de la Tour delivered on 18 June 2026.###

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