Published on 14/06/2018 4:27:22 PM | Source: Reuters

Exclusive: EU regulators to rule against Engie`s Luxembourg tax deal - source

Posted in Top Stories| #European Union #World Market

By Foo Yun Chee

BRUSSELS  - EU antitrust regulators in the coming weeks will order Luxembourg to recover millions of euros in back taxes from French power utility Engie, a person familiar with the matter said, as the EU steps up its crackdown on unfair tax deals.

It will be the third ruling by the European Commission against Luxembourg's tax deals with multinationals and the fifth against EU countries including Ireland, Belgium and the Netherlands.

The EU's competition enforcer declined to comment. The Luxembourg finance ministry, which has denied giving Engie any special treatment, was not available for immediate comment.

The Commission in 2016 opened an investigation into rulings granted by Luxembourg to Engie since 2008 which appeared to treat the same financial transaction between Engie subsidiaries as both debt and equity. The company has been present in Luxembourg since 1933.

This resulted in double non-taxation of companies in the GDF Suez group, as Engie was formerly known, a tax benefit which regulators said was not available to other companies.

The financial transactions were loans granted in 2009 and 2011 between four companies in the GDF Suez group that can be converted into equity and bear zero interest for the lender.

(Reporting by Foo Yun Chee; editing by Robert-Jan Bartunek and Jason Neely)