The European Commission on October 6 announced that it has decided to repeal its decision to refer the UK to the European Court of Justice over Gibraltar’s failure to fully recover illegal state aid.
The Commission had declared in March that it would take the UK to court over Gibraltar’s failure to recover EUR 100 million in multinational corporate tax exemptions for passive interest and royalties, which the Commission had concluded was illegal state aid in 2018. Despite the UK’s withdrawal from the EU, its withdrawal agreement left it subject to the Court of Justice for certain transitional matters.
Following the Commission’s decision to take the matter to court, Gibraltar completed recovery of the illegal state aid this summer. As a result, the Commission is dropping the case.
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