Is this the end of the Marks & Spencer Doctrine? - The Freedom of Establishment, Permanent Establishments and Objective Comparability

Abstract: The Thesis examines issues of European Corporate Tax Law and specifically the notion of the Marks & Spencer doctrine, with respect to non-resident permanent establishments. The doctrine entails the possibility for a resident company to deduct losses that were incurred by a PE, situated in another Member State. There is an ongoing debate among writers and scholars of European Tax Law concerning the application of the Marks & Spencer doctrine towards PE:s, due to recent judgements by the Court of Justice of the European Union on the matter. One of which have gained recent attention, namely Case C‑538/20, Finanzamt B v W AG. Writers on the topic seem to have conflicting views on whether the Courts judgement should be seen as a de facto abandonment, or simply a further establishment of the doctrine’s restrictive nature. The Thesis aimed to address whether the Marks & Spencer doctrine applies towards non-resident PE:s to the same extent as it does towards subsidiaries, and also provide a meaningful contribution to the ongoing debate concerning the status of the doctrine. The Thesis concluded that the doctrine of Marks & Spencer is applicable towards non-resident PE:s, under the circumstance that the non-resident PE can be deemed as objectively comparable to its domestic equivalent. Nevertheless, the Author of the Thesis noted that Case C‑538/20, Finanzamt B v W AG is subject to a pattern of case-law where the Court has become more restrictive in its language and approach throughout its line of case-law. This pattern can be understood as the Courts way of not excluding a legal position for the future, where they may have to eventually or potentially abandon the doctrine.