The European Court of Justice

The claim is based on the statutory application of the European Court of Justice Case Law in EU member states. The specific ruling relates to Case C-562/07 which addresses an action brought on 19 December 2007 by the EC Commission — Commission of the European Communities v Kingdom of Spain.

The ECJ decision rules against the Spanish discriminatory tax treatment of EC non resident regarding Capital Gains Tax paid up to 31st December 2006. During those years Spain treated capital gains tax paid under a clear discriminatory regimen for non residents.

Non residents were taxed at a flat rate of 35%, while residents were taxed at a flat 15% rate if the property had been owned for more than a year.

The Commission, on December 2007, referred Spain to the ECJ, on the grounds that the higher tax burden on non-residents is discriminatory in nature and restricts freedom of movement for workers and the free movement of capital, as provided for in Articles 39 and 56 EC and Articles 28 and 40 of the EEA agreement.

The case is now settled and Spain will need to comply with the decision. Before considering any action it is essential to consider the merits of each case with a qualified lawyer, specialized in Spanish property transactions.