Is the tax exemption enjoyed by UEFA legal? (shift)

The Commissioner for Competition, Mr. Vestager facing the press on November 20 (credit: EBS)
The Commissioner for Competition, Mr. Vestager facing the press on November 20 (credit: EBS)

(BRUSSELS2) The European Commission did not want " comment », for the moment, the French draft finance law allowing tax exemption for international sporting events. Principle which would allow UEFA in particular to benefit from a tax exemption (excluding VAT) to organize the Euro 2016 football tournament (June 10 to July 10, 2016). And the European Commissioner for Competition, Margrethe Vestager, whom I interviewed today admits " not knowing "... Indeed, off the cameras, an expert from the European executive admits having received " no notification from France for this device. Which seems surprising...

A tax exemption is state aid

We are concretely in a case of disguised State aid, even of “tax distortion” between Member States. If theEuro 2016 benefits from a tax exemption, it benefits in fact from aid (in the form of reduced expenditure). For a long time, the Commission and European justice have recognized that a tax exemption could constitute state aid. And France should have notified the European Commission of this measure to obtain a green light (there are many exceptions allowing state aid to be legitimized). This is not general, but specific, and directed towards a person or several people who do not obey objective criteria (*).

UEFA subject to competition

It cannot also be denied that the organization of football competitions is not entirely humanitarian or non-profit. Here again, the European position is quite clear. The European Commission and the Court of Justice have already recognized that UEFA was an organization which fell within the scope of competition control (cf. the investigation closed in 2002 on the rules imposed on clubs). The rules it enacts are considered rules of an association of undertakings recognized as an agreement. And this event generates significant economic benefits.

A distortion of competition which leads to a general rule

Finally, there is clearly a distortion of competition in a European sports competition market. The usual arguments, which emphasize the need to face up to international competition, cannot apply here since it is a question of attracting this… European event. If this event goes to France, it will not go to another European country. And vice versa. UEFA will have no trouble negotiating the same system in other European countries. Which will amount, in fact, to establishing a general rule of tax exemption for certain lucrative events and not others.


(*) We can read on this point the rather detailed article by Oskar van Maren, published on the specialized blog on the Sports Law, which analyzes in detail the conditions, or not, of state aid, applied to the case of UEFA

Nicolas Gros Verheyde

Chief editor of the B2 site. Graduated in European law from the University of Paris I Pantheon Sorbonne and listener to the 65th session of the IHEDN (Institut des Hautes Etudes de la Défense Nationale. Journalist since 1989, founded B2 - Bruxelles2 in 2008. EU/NATO correspondent in Brussels for Sud-Ouest (previously West-France and France-Soir).

Privacy Preferences Center