Does the Italian consolidation CJEU referral affect groups with non-EU parents?

The referral specifically tests whether EU freedom of establishment rules preclude the treatment in question, so the immediate legal argument applies to EU-parent structures. Groups with non-EU parents rely on different legal bases, such as applicable tax treaties, and are not directly covered by the freedom of establishment framework being tested in this case.

What is the current status of the EU Transfer Pricing Directive proposal?

As of the Hungarian Presidency's end-of-term report in December 2024, a majority of EU Member States do not see a path forward for the proposal in its current form. Member States are exploring an alternative: a non-legally binding EU Transfer Pricing Platform established outside the Directive framework, focused on producing consensus-based guidance.

How should accounting firms prepare for FASTER ahead of the 2030 application date?

Firms advising custodians, paying agents, and fund administrators should identify which clients are likely to qualify as certified financial intermediaries under the national registers. The associated due diligence and reporting requirements will need to be built into compliance frameworks before domestic implementing legislation is finalised, which is likely to happen several years before 2030. Early scoping avoids the resource pressure of a last-minute build.

EU Tax Update: FASTER Directive Adopted, CJEU Referrals on Italy Consolidation and Romania Windfall Tax

Q: What is the FASTER Directive and when does it take effect?

The FASTER Directive, adopted by the EU Council on 10 December 2024, creates a common digital tax residence certificate and introduces two fast-track procedures for recovering excess withholding taxes on cross-border dividend and interest payments: a relief-at-source system and a quick refund system. It also requires Member States to maintain national registers of certified financial intermediaries. The rules become applicable from 1 January 2030.

Q: What is the State aid argument in the Romanian windfall tax cases?

The Bucharest Court of Appeal asked the CJEU whether exempting fossil fuel-based and biomass electricity producers from a windfall tax, while taxing renewable energy producers, constitutes unlawful State aid to the exempt producers. If the CJEU agrees, Romania could be required to restructure the tax or recover the benefit conferred on exempt producers, with significant implications for the energy sector.

CryptaCount Editorial · July 4, 2026 · 8 min read

Three significant EU tax developments landed in close succession at the end of 2024: the Council formally adopted the FASTER Directive on withholding tax relief, Italy's Supreme Court sent questions about its tax consolidation regime to the Court of Justice of the EU, and the Bucharest Court of Appeal referred Romania's windfall tax on energy producers for a CJEU preliminary ruling. Each development carries practical implications for cross-border structures, treasury functions, and the tax compliance calendars of accounting firms advising EU clients.

EU Tax Update: FASTER Directive Adopted, CJEU Referrals on Italy Consolidation and Romania Windfall Tax

The FASTER Directive: What Was Adopted and When It Applies

On 10 December 2024, the Council of the EU adopted the Directive on Faster and Safer Tax Relief of Excess Withholding Taxes, known as FASTER. This was the final step in the legislative process, and the text will now be published in the EU Official Journal. The rules become applicable from 1 January 2030, giving Member States and financial intermediaries several years to build the required infrastructure.

Core Mechanics of the New Framework

FASTER introduces three structural changes to how excess withholding taxes on cross-border dividend and interest payments are handled across the EU.

First, a common digital tax residence certificate will replace the patchwork of nationally issued documents. The certificate will carry standardised content regardless of which Member State issues it, reducing the administrative friction that currently slows refund claims.

Second, two fast-track procedures will sit alongside the existing standard refund route. A relief-at-source system allows the correct reduced rate to be applied at the point of payment, removing the need to claim back an overpayment at all. A quick refund system accelerates the repayment process where relief at source is not used. Each in-scope Member State must implement at least one of these systems, or a combination of both.

Third, national registers of certified financial intermediaries will be established. Intermediaries that want to facilitate the fast-track procedures must enrol in these registers and meet additional due diligence and reporting obligations. That reporting layer is worth flagging now: firms advising custodians, paying agents, or fund administrators should begin mapping which entities are likely to fall within scope well ahead of the 2030 application date.

Legislative Background

The path to adoption included a general approach agreed at ECOFIN in May 2024, followed by a non-binding opinion from the European Parliament. The Hungarian Presidency noted the adoption in its end-of-term progress report to the European Council, describing it as one of the term's substantive tax deliverables. For firms that track EU ViDA implementation timeline and what it means for VAT reporting, FASTER represents a parallel digital transformation of a different corner of cross-border tax administration.

Italy: Tax Consolidation and the Freedom of Establishment

On 10 September 2024, Italy's Supreme Court referred several questions to the CJEU concerning the compatibility of the Italian tax consolidation regime with EU law. The case number has not been published in the source material, but the underlying fact pattern is substantive and the legal questions are precise.

The Fact Pattern Behind the Referral

The dispute originates with a French ultimate parent company that applied the Italian tax consolidation regime through its Italian branch. The parent also held four Italian-resident subsidiaries, but those subsidiaries could not join the consolidated group because the shares in them were not attributable to the Italian branch. The practical consequence was that those subsidiaries could only deduct 96 percent of the interest they paid to the branch. Inside a consolidated group, the interest would have been fully deductible.

The parent filed a refund claim in 2015 covering excess corporate income tax paid by the subsidiaries between 2010 and 2012. After several rounds of litigation, the case reached the Supreme Court, which concluded that the restriction might infringe the freedom of establishment and the principle of equal treatment of EU companies. The referral followed.

The CJEU Questions

The Supreme Court asked, in substance, whether EU law precludes national rules that deny access to a local tax consolidation regime solely because the common parent resides in another Member State, when the same companies would have qualified if the parent had been Italian-resident or had held the shares through an Italian permanent establishment. The Court also asked whether it is compatible with EU law to permit only vertical consolidation between a resident parent and resident subsidiaries, combined with horizontal integration between subsidiaries of a non-resident parent, while blocking consolidation where a non-resident parent directly owns Italian subsidiaries. A third question addresses procedural fairness: whether a company can be denied a refund on the basis that it did not opt into consolidation in its tax return, at a time when the national law did not actually permit it to do so.

The 2015 issue is relevant context. Italy amended its consolidation rules that year following the CJEU's joined cases C-39/13 to C-41/13, which required Member States to allow horizontal consolidation between sister companies controlled by a non-resident parent. The current referral tests whether the 2015 reform went far enough and whether the pre-reform exclusion gives rise to a compensable breach of EU law for earlier years.

For accounting firms managing cross-border group structures, the outcome will matter most to those advising Italian subsidiaries of non-resident EU parents where interest deductibility has been constrained by consolidation eligibility rules. It also reinforces the relevance of monitoring how the CJEU interprets how Cyprus IIR qualified status fits the Pillar 2 global minimum tax framework, given that both areas turn on how national regimes interact with EU-level freedoms.

Romania: Windfall Tax on Energy Producers Referred to CJEU

On 1 July 2024, the Bucharest Court of Appeal referred questions to the CJEU regarding Romania's windfall tax on electricity producers (case C-462/24). Romania introduced the tax in November 2021, and it has been amended and extended on multiple occasions. At the time of the referral, the tax was effective until 31 March 2025. The current referral concerns versions of the legislation that applied from 1 April 2022 to the end of 2023.

The Legal Questions at Stake

The referring court identified two core issues. First, whether limiting the tax to certain electricity producers, in practice renewable energy producers, while exempting fossil fuel-based producers and, from January 2022, biomass producers, constitutes unlawful State aid in favour of the exempt producers. Second, whether the selective and, in the referring court's framing, excessive burden placed on renewable energy producers breaches the freedom of establishment, the freedom to provide services, the free movement of capital, and Article 17 of the EU Charter of Fundamental Rights, which protects the right to property.

This referral does not stand alone. Four other cases concerning different versions of the Romanian windfall tax are already pending before the CJEU: C-391/23, C-251/24, C-261/24, and C-392/24. The accumulation of cases signals that the legal challenges to Romania's approach are systematic rather than isolated, and that the CJEU will likely need to issue guidance covering multiple legislative iterations.

Other Developments: Shell Entities and Transfer Pricing

The Hungarian Presidency's end-of-term report also flagged two other tax proposals that did not reach resolution during the presidency.

Shell Entities Directive

On the proposal to prevent misuse of shell entities for tax purposes, the Presidency introduced new drafting suggestions covering scope, hallmarks, and reporting obligations. Council working groups requested further clarification on the relationship between the proposal and the Directive on Administrative Cooperation, and raised concerns about the risk of excessive administrative burden for both businesses and tax authorities. The proposal remains under negotiation.

Transfer Pricing Directive

The Presidency's report noted that a majority of EU Member States do not see a path forward for the Transfer Pricing Directive in its current form. In parallel, Member States discussed the possibility of establishing a new EU Transfer Pricing Platform outside the framework of a Council Directive. Discussions covered institutional set-up, governance, and voting rules, with the aim of producing consensus-based, non-legally binding guidance. No decisions were taken.

Practical Takeaways for Accounting Firms and CFOs

FASTER is the only item here with a confirmed application date, and 2030 may sound distant. In practice, the build-out of national intermediary registers and digital certificate infrastructure will require multi-year projects. Firms advising paying agents or custodians should begin scoping the due diligence and reporting requirements now rather than waiting for domestic implementing legislation.

The Italian consolidation referral has retrospective dimensions, covering tax years from 2010 to 2012, as well as prospective relevance for any group where a non-resident EU parent holds Italian subsidiaries outside a consolidated group. If the CJEU rules in favour of the plaintiff, refund opportunities may open for similarly positioned groups, subject to applicable limitation periods under domestic law.

The Romanian windfall tax cases are primarily relevant for energy sector clients with Romanian operations, but the State aid and fundamental freedoms arguments being tested have broader resonance. A CJEU finding that selective sectoral taxation constitutes unlawful State aid could influence how other Member States design similar levies.

Across all three areas, the underlying compliance need is the same: accurate, audit-ready records of group structures, interest flows, withholding tax positions, and jurisdictional exposures. Firms using robust crypto accounting software and digital asset accounting tools as part of their broader practice infrastructure are better positioned to respond quickly when CJEU rulings crystallise into refund opportunities or compliance obligations.