Pre-litigation procedure
6By letter of formal notice of 20November 2015, the Commission drew the attention of the Spanish authorities to the incompatibility with EU law of certain aspects of the obligation to declare overseas assets or rights by means of ‘Form 720’. In its view, the consequences of failure to comply with that obligation were disproportionate in the light of the objective pursued by the Spanish legislation.
7Following the reply sent by the Kingdom of Spain on 29February 2016, in which that Member State disputed the existence of any incompatibility with EU law, the Commission sent a reasoned opinion on 15February 2017 in which it maintained the position it had taken in its letter of formal notice.
8By letters of 12April 2017 and 31May 2019, the Kingdom of Spain replied to that reasoned opinion. It argued, in essence, relying on certain practical examples, that the legislation at issue was compatible with EU law.
9As it was not convinced by the Kingdom of Spain’s arguments, on 23October 2019 the Commission brought the present action on the basis of Article258 TFEU.
- Legal context
- Pre-litigation procedure
- The action
- The freedoms at issue
- The existence of a restriction on the movement of capital
- Justification for the restriction on the free movement of capital
- The proportionality of the classification of assets held abroad as ‘unjustified capital gains’, without the benefit of a limitation period
- Costs