European Court of Justice Rules EU Mutual Assistance Directive Confers Limited Rights for Taxpayer on Exchange of Tax Information

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Wednesday, January 1, 2014
Bruce Zagaris

On October 22, 2013, the European Court of Justice, in the case of Jiri Sabou v. Czech Republic (C-276/12), held that Directive 77/799 , the EU mutual assistance directive, and the fundamental right to be heard, do not confer on a taxpayer the right to be informed of a tax authority’s decision to make a request for information from another state, and do not require that he have the right to participate in the requested state’s gathering of the information or to participate in examinations of witnesses organized by the requested state.  In part, the Court based its decision on the fact that Directive 77/799, as amended by Directive 2006/98, does not govern the question of the circumstances in which the taxpayer may challenge the accuracy of the information conveyed by the requested EU Member and does not impose any specific obligation with regard to the content of the information conveyed.