European Court of Justice: Dutch dividend withholding tax allowed on dividends to the (former) Netherlands Antilles in order to combat tax avoidance

On 5 June 2014, the European Court of Justice (“ECJ”) published its judgment in the combined cases X BV (C-24/12) and TBG Limited (C-27/12). The ECJ ruled that a tax measure of a Member State which restricts movements of capital between that Member State and its own overseas country and territory whilst pursuing the objective of combating tax avoidance in an effective and proportionate manner is allowed. The Dutch Supreme Court (“DSC”) should still assess whether the objective of combating tax avoidance with the Dutch dividend withholding tax is pursued in an effective and proportionate manner. Read more in the below attachment.