Opinion of Advocate General Kokott delivered on 30 May 2024.

• Jurisdiction: European Union
• Celex Number: 62023CC0432
• ECLI: ECLI:EU:C:2024:446
• Date: 30 May 2024
• Court: Court of Justice (European Union)

Provisional text

OPINION OF ADVOCATE GENERAL

KOKOTT

delivered on 30 May 2024 (1)

Case C‑432/23

F,

Ordre des Avocats du Barreau de Luxembourg

v

Administration des contributions directes

(Request for a preliminary ruling from the Cour administrative (Higher Administrative Court, Luxembourg))

(Request for a preliminary ruling – Tax law – Charter of Fundamental Rights of the European Union – Article 7 – Directive 2011/16/EU – Administrative cooperation in the field of taxation – Article 5 – Article 6 – Article 18 – Request for information from the tax authority of another Member State – Information order from the requested tax authority – Surrender of documents by a lawyer – Professional secrecy of a lawyer – Proportionality of surrendering documents relating to services provided in the field of advice on company law)

I. Introduction

1. Ensuring uniform and lawful tax enforcement in a globalised world requires cooperation between tax administrations. It was for this reason that, in adopting Directive 2011/16/EU, (2) the EU legislature created a legal basis for cooperation between national tax administrations within the European Union. That directive provides in particular for a cross-border exchange of information.

2. At the same time, however, such an exchange of information and the enquiries associated with it lead to interference with the fundamental rights of the affected taxpayers and persons obliged to provide information. So it is that the Court has already had to address the protection of fundamental rights in the scope of application of Directive 2011/16 on a number of occasions in the past. (3)

3. A request for a preliminary ruling from Luxembourg now raises the question as to whether and, if so, under what conditions a tax administration may seek disclosure from a lawyer in the context of an exchange of information on request. In that regard, the Court has already emphasised the importance of protecting the confidentiality of communications between lawyers and their clients in connection with the reporting obligation (4) applicable to cross-border tax arrangements. (5)

4. The present case presents an opportunity to spell out further what protection legal professional privilege (‘LPP’) enjoys. In particular, it raises the question as to whether advice or representation provided on tax matters can generally be excluded from the protection afforded to LPP under EU law, as it can in Luxembourg law.

II. Legal framework

A. European Union law

5. The exchange of information on request is governed by Section I of Chapter II of Directive 2011/16. Article 1(1) reads:

‘1. This Directive lays down the rules and procedures under which the Member States shall cooperate with each other with a view to exchanging information that is foreseeably relevant to the administration and enforcement of the domestic laws of the Member States concerning the taxes referred to in Article 2.’

6. Article 5 of that directive provides:

‘At the request of the requesting authority, the requested authority shall communicate to the requesting authority any information referred to in Article 1(1) that it has in its possession or that it obtains as a result of administrative enquiries.’

7. In addition, Article 6 of Directive 2011/16 contains rules on the enquiries that may have to be carried out in the requested State:

‘1. The requested authority shall arrange for the carrying out of any administrative enquiries necessary to obtain the information referred to in Article 5.

2. The request referred to in Article 5 may contain a reasoned request for an administrative enquiry. If the requested authority takes the view that no administrative enquiry is necessary, it shall immediately inform the requesting authority of the reasons thereof.

3. In order to obtain the requested information or to conduct the administrative enquiry requested, the requested authority shall follow the same procedures as it would when acting on its own initiative or at the request of another authority in its own Member State.

…’

8.Article 16 et seq. of Directive 2011/16 lays down general conditions governing administrative cooperation. Article 17(1) and (4) of Directive 2011/16 provides:

‘1. A requested authority in one Member State shall provide a requesting authority in another Member State with the information referred to in Article 5 provided that the requesting authority has exhausted the usual sources of information which it could have used in the circumstances for obtaining the information requested, without running the risk of jeopardising the achievement of its objectives.

4. The provision of information may be refused where it would lead to the disclosure of a commercial, industrial or professional secret or of a commercial process, or of information whose disclosure would be contrary to public policy.’

9.Article 18 of Directive 2011/16 provides:

‘1. If information is requested by a Member State in accordance with this Directive, the requested Member State shall use its measures aimed at gathering information to obtain the requested information, even though that Member State may not need such information for its own tax purposes. That obligation is without prejudice to paragraphs 2, 3 and 4 of Article 17, the invocation of which shall in no case be construed as permitting a requested Member State to decline to supply information solely because it has no domestic interest in such information.

2. In no case shall Article 17(2) and (4) be construed as permitting a requested authority of a Member State to decline to supply information solely because this information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.’

B. Luxembourg law

10. Article 177 of the Loi générale des impôts du 22 mai 1931 (General Tax Law of 22 May 1931; ‘the Luxembourg Tax Code’) provides in essence:

‘(1) The following may also refuse to communicate information:

1. Defence counsel and lawyers who have acted in criminal cases,

2. Doctors in respect of information entrusted to them in the exercise of their profession,

3. Lawyers in respect of information entrusted to them in the exercise of their profession[,]

4. Assistants or collaborators of the persons referred to in points 1 to 3 in respect of facts which they have learned in that capacity.

(2) This provision shall not be applicable to the persons referred to in points 3 and 4 in respect of facts of which they became aware in connection with advice or representation in tax matters, unless an affirmative or negative response to questions would put their clients at risk of criminal prosecution.’

III. Facts

11. On 28 June 2022, the Directeur de l’administration des contributions directes (Director of the Direct Taxation Administration, Luxembourg) sent F, a société en commandite simple (limited partnership) (‘the applicant’) a decision (‘the information order’) which was worded in essence as follows:

‘… the competent authority of the Spanish tax administration has sent us a request for information pursuant to … Council Directive 2011/16/EU of 15 February 2011 …

The legal person to which the request relates is the Spanish company K …

Could you please provide, for the period from 1 January 2016 to 31 December 2019, the following information and documents no later than 3 August 2022:

– Please provide all available documentation for the period in question (engagement letter, contracts with the client, reports, memoranda, communications, invoices etc.) relating to services provided by [your company] F to the Spanish company K in connection with:

1. the acquisition in 2015 of 80% of the shares in [N] by the investment group [O] (invoice No …);

2. the acquisition of another Spanish undertaking by the group in 2018 (invoice No …);

– Please provide a detailed description of the manner in which the abovementioned operations were conducted, from the time when the services of [F] were engaged until their completion, as well as an explanation of its involvement in those processes and the identity of its interlocutors (vendors, buyers and third parties) and invoices; …’

12. By email of 8 July 2022, F informed the Direct Taxation Administration that it had acted as lawyer/legal counsel for the group to which K belongs, and that it was therefore prevented by law from communicating information concerning its client in so far as that information was covered by its LPP.

13. In a letter sent by registered post on 8 August 2022, F reaffirmed its position, stating that the instruction from its client in the case to which the decision relates did not cover tax matters but concerned only company law.

14. By letter sent by registered post of 19 August 2022, the Director of the Direct Taxation Administration informed the applicant that that response was not satisfactory. Thereafter, by decision of 16 September 2022, it imposed on the applicant a fine for failing to comply with the information order.

15. The applicant challenged that decision before the national courts by way of an action in which the Ordre des Avocats du Barreau de Luxembourg (Luxembourg Bar) participated as an intervener. By decision of 23 February 2023, the Tribunal administratif (Administrative Court, Luxembourg) dismissed the action and the intervention.

16. By applications received on 10 and 13 March 2023, the applicant and the Bar lodged an appeal against that judgment with the Cour administrative (Higher Administrative Court).

IV. Request for a preliminary ruling

17. The court with jurisdiction to hear and determine the main proceedings, the Cour administrative (Higher Administrative Court), decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling under Article 267 TFEU:

‘(1) Does legal advice provided by a lawyer on matters of company law – in this case on setting up a...