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ECJ sets date for Danner Case ruling

EUROPE- The European Court of Justice has said it will pass judgement on the Danner case at the beginning of October. A verdict, expected on the 3rd of the month, will receive close scrutiny as many champions of pan European pensions believe it will, if successful, help pave the way for European schemes.

The case involves German-born Rolf Dieter Danner and challenges as contrary to an article of the EC Treaty a Finnish law that taxes pension insurance contributions made in Finland to a foreign institution.

Danner’s claim is that Finns wishing to contribute to a scheme outside the country do not receive the same treatment as those paying into domestic schemes.

A favourable verdict would set a precedent and help counter inconsistent tax laws across the EU that are seen as the last barrier to companies launching European schemes.

A judgement in favour of Danner is not guaranteed but in March the case’s general advocate suggested the Finnish law contravened EU legislation.

Since the advocate general is not a judge- rather the equivalent of a European public prosecutor- his opinion is not legally binding but in the majority of cases the eventual verdict mirrors it.

Danner is the most advanced in a series of test cases. Recently Pepgo, an association of 20 multinational companies, including Swiss Life and construction company Kvaerner, eager to launch cross-border pensions, filed a similar complaint to the UK’s Inland Revenue on behalf of an employee at the consultants AMS Management Systems.

The insurance company Skandia recently began a teat case challenging Swedish legislation that stipulates contributions to insurance-backed pensions funds are only tax exempt if made to locally-domiciled insurance companies.

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