EU Fundamental Freedoms and Dividend Taxation

Dividend taxation is one of the areas of direct taxation in which the European Court's fundamental freedom scrutiny has had the most significant impact on Member States' tax systems. Two key judgements are routinely identified as the landmark decisions that led to this development and that were subsequently refined and modified in a series of further Court rulings: the Verkooijen case regarding inbound dividends from outbound investments made by resident taxpayers and the ACT Group Litigation (ACT GL) case concerning outbound dividends from inbound investments made by non-resident shareholders. This paper endeavours to outline the most relevant findings of the CJEU in those two precedents as well as in the subsequent line of judgements that built upon them, and to provide some critical comments where appropriate. Furthermore, the paper will contrast the approach of the CJEU in the context of outbound dividend taxation with the findings of the EFTA Court in its well-known Fokus Bank decision