On 18 June 2026, Advocate General Jean Richard de la Tour delivered his Opinion in case C-241/25, Société Générale SA v Skatteverket, a Grand Chamber referral from the Swedish Supreme Administrative Court (lodged on 28 March 2025) that goes to the heart of a question left open by the Court’s landmark rulings in Sofina (C-575/17, judgment of 22 November 2018) and Credit Suisse Securities (Europe) (C-601/23, judgment of 19 December 2024): when a loss-making non-resident company claims equal treatment with a loss-making resident company on dividends subject to withholding tax, under whose rules must the loss be measured?
The facts are familiar territory. In 2012, Société Générale, a French tax resident belonging to a French tax group, received dividends from portfolio holdings in Swedish companies. The dividends suffered Swedish withholding tax notwithstanding that the recipient was in a tax loss position, whereas a loss-making Swedish company would not have borne any current taxation on the same income, since resident companies are taxed on their overall annual result. The Swedish tax authority refused reimbursement. Sweden had in the meantime reacted to Sofina by introducing, with effect from 1 January 2020, a deferral mechanism for loss-making non-resident recipients, but subject to a demanding condition: the foreign company must demonstrate its loss position as recomputed under Swedish tax rules.
It is precisely that condition which the Advocate General proposes to strike down. In his view, Article 63 TFEU precludes legislation of the source State which requires a non-resident dividend recipient, in order to obtain the treatment reserved to loss-making resident companies, to recalculate its loss in accordance with the tax law of that State. The restriction on the free movement of capital was not in dispute between the parties; the decisive point is that imposing a full recomputation of the foreign shareholder’s tax position under source-State rules places a disproportionate administrative burden on non-resident companies and, in substance, treats them as if they were residents, which goes beyond the objective comparability that the Court’s case law requires. Nor can such a regime be justified in general terms by the need to combat tax avoidance: pathological situations, such as loss-making shells interposed to capture dividends, can be addressed through general anti-abuse rules and the exchange of information between tax administrations, without imposing a generalised compliance obstacle on all cross-border investors.
Should the Grand Chamber follow its Advocate General, the judgment will resonate well beyond Sweden. Several Member States operate, or have introduced post-Sofina, deferral or refund mechanisms for loss-making non-resident recipients whose conditions effectively replicate the domestic tax base computation. The Opinion signals that comparability is to be assessed on the recipient’s loss position as it genuinely stands, not filtered through a fictitious recomputation under foreign rules, and that the compliance design of these regimes is itself subject to proportionality review.
For international groups and institutional investors, the practical indication is immediate: entities that suffered withholding tax on EU-source dividends in years in which they were loss-making under their home-State rules should map their exposure and consider protective refund claims within the applicable domestic limitation periods, both for pre-deferral years and for years in which relief was denied on account of recomputation requirements. The Grand Chamber’s judgment is now awaited.
