The ECJ has begun hearing the case of Felixstowe Dock & Railway Co Ltd v HMRC (and related appeals) (ECJ Case C-80/12). Several members of a group of companies (with an ultimate Hong Kong parent) claimed group relief in respect of losses made by a UK company (HUK) through an intermediate holding company (HS) which was resident in Luxembourg. HMRC rejected the claim on the basis that the effect of ICTA 1988 s 402(3B) and s 406(2) was that the companies were not entitled to relief. The companies appealed contending that the relevant UK provisions contravened EC law. The First-Tier Tribunal directed (see decision TC01674) that the case should be referred to the ECJ for a ruling on whether Articles 49 and 54 of the TFEU should be treated as precluding ‘the requirement that the "link company" be either resident in the United Kingdom or carrying on a trade...
