ECJ Judgment FII C-362/12: Restitution of sums paid but not due and Legal Certainty

According to the ECJ Judgment on the Franked Investment Income case (C-362/12):

1.  In a situation in which, under national law, taxpayers have a choice between two possible causes of action as regards the recovery of tax levied in breach of European Union law, one of which benefits from a longer limitation period, the principles of effectiveness, legal certainty and the protection of legitimate expectations preclude national legislation curtailing that limitation period without notice and retroactively.

2.      It makes no difference to the answer to the first question that, at the time when the taxpayer issued its claim, the availability of the cause of action affording the longer limitation period had been recognised only recently by a lower court and was not definitively confirmed by the highest judicial authority until later.

In my view, it is relevant to stress that the Court also invokes the principles of legal certainty and the protection of legitimate expectations (and not only the principle of effectiveness), because these principles could be applied to other matters beyond the restitution of sums paid but not due. The ECJ doctrine is far more demanding than the current approach of the Spanish Constitutional Court. This judgment could provide some solid fundamentals for a change of our constitutional case-law.

Many thanks (once more) to Tom O’Shea for all the info provided.

Pedro M. Herrera

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