I. EDITORIAL – NEW RULES AGAINST TAX AVOIDANCE
The month of may was marked, in legislative level, by the publication of different relevant laws, mainly in tax law, deserving special mention the Law no. 32/2019 of May 3 and Ordinance nº 144/2019 of May 15.
The Law no. 32/2019 of May 3, transposing the Council Directive (EU) 2016/1164 of 16 July 2016, and in order to reinforce the fight against tax avoidance practices, has enlarged the scope of the application of the General Anti-abuse Rule and corresponding tax procedure and amends, also, the articles 46, 54-A, 66, 67, 83 and 84 of the Corporate Income Tax , implementing additional rules regarding the corporate income tax regimes, such as: the concept of capital gains and losses, imputation of income (alias, international tax transparency), limitation of financial expenses deductibility, transference of tax residence and cession of permanent establishment activity.
The Ordinance no. 144/2019 of May 15 regulates the terms and conditions for the exercise of the option laid down by point c) of the no. 1 of the article 8 of the Decree-Law no. 28/2019, of February 15, by the taxable persons who intent being exempt of printing of paper invoices or their electronic transmission.
Regarding case-law, it is worth noting the Judgment of the Constitutional Court no. 221/2019, in Case no. 1094/18 which declares the unconstitutionality, with general obligatory force, for violation of the relative reserve of legislative competence of the Assembly of the Republic in human rights, freedoms and guarantees matters, provided for in Article 165 , paragraph 1, point b) of the Constitution, of the norm foreseen by article 64, paragraph 7, of Decree-Law no. 291/2007, of August 21, in the wording introduced by Decree-Law no. 153/2008 of August 6, according to which, in the actions for the realization of the civil responsibility resulting from a traffic accident, in order to determine the monthly income of the injured person, for determination of the amount of compensation for material damages to be attributed to the same, the court can only assess the net income earned at date of the accident, which are fiscally proven, after complying with the legally established declarative obligations for such a period.
Finally, in the area of Miscellaneous we would like to draw attention to the approval by the Council of Ministers of the draft law which amends the regime applied to the inventory process and of the draft Law which proceeds to the transposition of the Council Directive (EU) 2017/1852 of 10 October 2017, regarding the tax dispute resolution mechanisms in the European Union.
Law no. 32/2019 of May 3: Reinforces the fight against tax avoidance, transposing the Council Directive (EU) 2016/1164 of 16 July 2016.
Decree-Law no. 60/2019 of May 13: Determines the application of the reduced VAT rate to the fixed component of certain electricity and natural gas supplies.
Decree-Law no. 61/2019 of May 14: Amends the operating regime of Social and Economic Council.
Ordinance no. 144/2019 of May 15: Regulates the terms and conditions for the exercise of the option laid down by point c) of the paragraph 1 of the article 8 of the Decree-Law no. 28/2019, of February 15, by the taxable persons who intent being exempt of printing of paper invoices or electronic transmission.
Decree-Law no. 67/2019 of May 21: Proceeds the increase of the municipal property tax regarding the vacant properties in urban pressure zones.
Law no. 33/2019 of May 22: Amends the Code of Criminal Procedure approved by the Decree-Law no. 78/87 of February 17, transposing the Directive (EU) 2016/800, of the European Parliament and of the Council of 11 May 2016, on procedural safeguards for children who are suspects or accused persons in criminal proceedings.
Decree-Law no. 68/2019 of May 22: Creates the Affordable Renting Programme.
Decree-Law no. 68/2019 of May 22: Establishes a special regime for affordable rental insure contracts in the scope of the Affordable Renting Programme.
Ordinance nº 165/2019 of May 29: Administrative Fees – Travel and Tourism Guarantee Fund (FGVT).
III.1. Court of Justice of the European Union
Judgment of Court of 8 May 2019, Case C‑486/18: Reference for a preliminary ruling. Social policy. Directive 96/34/EC. Framework agreement on parental leave. Clause 2.6. Worker employed full-time and for indefinite duration on part-time parental leave. Dismissal. Compensation payment for dismissal and redeployment leave allowance. Method of calculation. Article 157 TFEU. Equal pay for male and female workers. Part-time parental leave taken primarily by female workers. Indirect discrimination. Objective factors unrelated to any sex discrimination. None.
Summary: “Clause 2.6 of the framework agreement on parental leave concluded on 14 December 1995, which is annexed to Council Directive 96/34/EC of 3 June 1996 on the framework agreement on parental leave concluded by UNICE, CEEP and the ETUC, as amended by Council Directive 97/75/EC of 15 December 1997, must be interpreted as precluding, where a worker employed full-time and for an indefinite duration is dismissed at the time he is on part-time parental leave, the compensation payment for dismissal and the redeployment leave allowance to be paid to that worker being determined at least in part on the basis of the reduced salary which he receives when the dismissal takes place.
– Article 157 TFEU must be interpreted as precluding legislation such as that in the main proceedings which provides that, where a worker employed full-time and for an indefinite duration is dismissed at the time he is on part-time parental leave, that worker receives a compensation payment for dismissal and a redeployment leave allowance determined at least in part on the basis of the reduced salary being received when the dismissal takes place, in circumstances when a far greater number of women than men choose to take part-time parental leave and when that difference in treatment which results therefrom cannot be explained by objective factors unrelated to any sex discrimination.”
Judgment of the Court 8 May 2019, Case C‑712/17: Reference for a preliminary ruling. Value added tax (VAT). Fictitious transactions. Impossibility of deducting the tax. Obligation on the issuer of an invoice to pay the VAT indicated thereon. Fine in an amount equal to the amount of the improperly deducted VAT. Whether compatible with the principles of VAT neutrality and proportionality:
Summary: “ In a situation, such as that at issue in the main proceedings, in which fictitious circular sales of electricity made between the same traders and for the same amounts did not cause tax losses, Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, read in the light of the principles of neutrality and proportionality, must be interpreted as not precluding national legislation which excludes the right to deduct value added tax (VAT) relating to fictitious transactions while requiring the persons who enter VAT on an invoice to pay that tax, including for a fictitious transaction, provided that national law allows the tax liability arising from that obligation to be adjusted when the issuer of that invoice, who was not acting in good faith, has, in sufficient time, wholly eliminated the risk of any loss of tax revenue, this being a matter for the referring court to ascertain.
The principles of proportionality and neutrality of value added tax (VAT) must be interpreted as precluding, in a situation such as that at issue in the main proceedings, a rule of national law under which the unlawful deduction of VAT is penalised by a fine equal to the amount of the deduction made.”
Judgement of the Court 16 May 2019, Case C‑509/17: Reference for a preliminary ruling. Transfers of undertakings. Directive 2001/23/EC. Articles 3 to 5. Safeguarding of employees’ rights. Exceptions. Insolvency proceedings. Proceedings for judicial restructuring by transfer under judicial supervision. Total or partial safeguard of the undertaking. National legislation authorising the transferee, after the transfer, to choose which employees to keep on.
Summary: “Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses, in particular Articles 3 to 5 thereof, must be interpreted as precluding national legislation, such as that at issue in the main proceedings, which, in the event of the transfer of an undertaking which has taken place in the context of proceedings for judicial restructuring by transfer under judicial supervision applied with a view to maintaining all or part of the transferor or its activity, entitles the transferee to choose the employees which it wishes to keep on.”
III.2. Constitutional Court
Judgment of the Constitutional Court no 221, Case no. 1094/18: Declares the unconstitutionality, with general obligatory force, for violation of the relative reserve of legislative competence of the Assembly of the Republic in human rights, freedoms and guarantees matters, provided for in Article 165 , paragraph 1, point b) of the Constitution, of the norm foreseen by article 64, paragraph 7, of Decree-Law no. 291/2007, of August 21, in the wording introduced by Decree-Law no. 153/2008 of August 6, according to which, in the actions for the realization of the civil responsibility resulting from a traffic accident, in order to determine the monthly income of the injured person, for determination of the amount of compensation for material damages to be attributed to the same, the court can only assess the net income earned at date of the accident, which are fiscally proven, after complying with the legally established declarative obligations for such a period.
III.3. Courts of Justice
Judgment of the Court of Appeal of Lisbon, of May 16, Case no. 89078/18.6YIPRT-A.L1-6: Injunction. Commercial transaction. Commercial invoice. Inexistence. Unnamed dilatory objection.
Judgment of the Court of Appeal of Lisbon, of May 23, Case no. 148/17.2YHLSB.L1-8: Intellectual property. Trademarks. Imitation. disloyal competition. Brand of great prestige.
III.4. Administrative and Tax Court
Judgment of the Supreme Administrative Court, of May 22, Case no. 0169/16.2BEPDL: Exemption. Recognition. Cessation. Effects. Act. Statute. Tax benefits.
Judgment of the Central Administrative Court South, of May 20, Case no. 857/12.2BELRA: IRS. Income statements. Burden of proof. Duties of collaboration.
IV.1.1. Monographs and Periodic Publications
Nuno Miguel Cunha Rolo, Manual de Administração e Governação Pública-Vol. I, Editor: AAFDL, maio 2019.
IV.1.2. Generic Guidelines & Cia
Circular Letter no. 35.107 of 05.10.2019, of the Department of Excise duties and Vehicle Tax.
Subject: Global guarantee for Vehicle Tax and VAT
IV.2.1. Economy, Finance and Taxation
The Council of Ministers on 2 May 2019 approved the draft Law which proceeds to the transposing the Council Directive (UE) 2017/1852 of 10 October 2017, regarding the tax dispute resolution mechanisms in the European Union. This legislative initiative is directed, particularly, to companies which pursue cross-border activities and face obstacles regarding double-taxation of the income obtained in different countries.
Also, on 9 May of 2019 was approved by the Council of Ministers the new legal regime of legal and court access, through which it looking for the improvement of the quality of the access to the law access and legal support in the sense to provide a better service to the citizens who need, ensuring better social justice. Hence, access to the law to a broader universe of citizens and companies is ensured, while at the same time the legal protection is adjusted to the financial capacity of each citizen or company, being redefined the the concept of economic insufficiency, regarding natural persons as well as legal persons.
Finally, it was also approved on 9 May 2019 the draft law that amends the regime applied to the inventory process. In this draft law it is proposed that the interested parties be given the option of recourse to the court or notary public, however, it is mandatory to proceed to the Court in situations where, because of the interests of minors, absent, the inventory is required by the Public Prosecutor’s Office. It was also amended the Civil Procedure Code, reintroducing the inventory process and adding some improvements in segments in which judicial practice or social reality justified it. One of these improvements relates to a greater protection of citizens with regard to the attachment of the house of their own dwelling, whose garnishment is only admissible in execution of an amount equal to or less than double the level of the court of first instance (10 000 Euros) and if the seizure of other assets does not presumably allow the credit to be satisfied within 30 months.
V. INDUSTRIAL PROPERTY
“Federated Register”, a platform of the European Patent Office: Reestablishment of the national data of the tool “Federated Register” of the EPO.
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- I. EDITORIAL
- II. LEGISLATION
- III. CASE-LAW
- IV. BRIEFS
- V. INDUSTRIAL PROPERTY