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Treasury Department Highlights Discriminatory EU State Aid Investigations

Aug 25, 2016

The Treasury Department’s white paper on European Union state aid investigations should be a wake-up call to the European Commission that it is well past time to stop its unprecedented and discriminatory state aid investigations against U.S. companies.  In a February 2016 op-ed, Business Roundtable President John Engler stated that these investigations were a blatant attempt by the EU to fill its budget holes by targeting U.S. companies. 

Today’s release by the Treasury Department highlights the ways in which the current state aid investigations represent unprincipled deviations from prior EU case law and Commission decisions.  The Commission’s approach is also inconsistent with internationally recognized transfer pricing standards and overrides EU Member State bilateral tax treaties.  The Commission further compounds injury by seeking retroactive recoveries of alleged state aid – going back as far as 10 years – in a manner inconsistent with EU principles of legal certainty and counter to well recognized global efforts to improve tax certainty, as most recently articulated by the G20 in its July 2016 communique.  

Congressional leaders have previously expressed their concern for the Commission’s actions.  Links to Ways and Means, SFC letters and statements:

As BRT President Engler urged last February, it is time for the Commission to halt these discriminatory actions and work constructively with the U.S. government to avoid escalating the situation.