CJEU: litigation about French taxation of 5% dividends received from EU subsidiaries

By Laurence Clot


The CJEU ruled that the French taxation of 5% fraction of dividends received from foreign subsidiaries is incompatible with EU law. It is possible to introduce a claim for the refund of such taxation on dividends received from EU subsidiaries owned at least at 95% for fiscal years 2012 (claim should be filed before 31 December 2015), 2013 and 2014.

Court decision

• The CJEU judged in its decision called Steria Group dated 2 September 2015 (case C-386/14) the French system as EU incompatible when it allows the neutralization of the 5% fraction of the dividends paid by French subsidiaries but refuses such neutralization when the dividends are received from foreign subsidiaries (including subsidiaries located in other EU member state).

Amount to be claimed back
• As a reminder, a fraction of dividends fixed at a flat rate of 5% is included in the French tax bases. Such 5% could be tax free within the French tax consolidation regime but remain taxable when the dividend is paid by foreign entities.


Companies concerned

• French companies which receive dividends from a EU subsidiary owned at least at 95%.



• Companies can claim back such taxation for fiscal years 2012, 2013 and 2014.

• For fiscal year 2012, claim must be filed before 31 December 2015.

The Bird & Bird tax team is available to assist you in this respect.