‘Tax Haven’ conditions included in COVID-19 state aid schemes: Can they be tested?

Research output: Contribution to journalEditorialScientificpeer-review


At the time of writing this article, the globe, including Europe, is in the second wave of the COVID-19 pandemic. People are suffering not only physically, but also mentally because of (partial) lock downs. Health care systems of many countries are under extreme pressure. Inter alia, due to the (partial) lock downs, economic activities have substantially decreased. In order to support their economies and to facilitate their recovery, the EU and its Member States have taken unprecedented action. A number of State interventions are subject to the EU State aid rules. A number of Member States made the granting of State aid dependent on the absence of links with countries which are frequently tagged as ‘tax havens’. Examples are Belgium, Denmark, France, The Netherlands, Poland, and Sweden. For example, the European Commission has decided that the Polish conditions are consistent with EU law. More in general, the Commission has recommended Member States to make State aid conditional to the absence of links with non-cooperative jurisdictions, frequently referred to as ‘tax havens’. Whether a country qualifies as ‘tax haven’, may differ Member State by Member State. Since the term ‘tax haven’ is often used in academic literature and the mainstream press, the author also uses this term here, but he will also explain this term in more detail within the context of the rules to be discussed.
In this article, the research question is twofold:
1. Can the condition of making COVID-19 State aid dependent on the absence of links to ‘tax havens’ (hereafter: tax haven condition) be tested against fundamental freedoms?
2. Should this question be brought to court?
In order to answer these questions, this article adheres to a traditional legal methodology. This methodology makes it possible to acquire a more complete understanding of the possible impact of fundamental freedoms on conditions to provide COVID-19 State aid, more specifically on tax haven conditions. For the descriptions, analyses, and evaluations, the author has used sources of law, including national tax law, treaties, global issues (e.g. global principles in redistributive justice), legislative history, technical explanations, case law, decisions, statements of practice, public rulings, and literature.
In order to answer the research questions, firstly, the Commission’s Recommendation on making COVID-19 State aid conditional to the absence of links with non-cooperative jurisdictions has been outlined. Subsequently, as an example, the Dutch tax haven conditions have been described. Thereafter, it has been discussed whether tax haven conditions as part of COVID-19 State aid can be tested against fundamental freedoms. Furthermore, the Dutch example has been tested against the outcomes of the previous point. With the results of these points, research question 1 can be answered. The question of whether the test of tax haven conditions to fundamental freedoms should be brought to court, has been discussed in the section ‘Who dares to litigate?’. The author has closed with the main conclusions by answering the research questions.
Original languageEnglish
Pages (from-to)2-7
JournalEC Tax Review
Issue number1
Publication statusPublished - 2021


  • Tax Haven, COVID-19, State Aid, Fundamental Freedoms, European Union


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