Navigation path

Left navigation

Additional tools

Other available languages: FR DE


Brussels, 16 February 2011

Taxation: Commission requests France to amend discriminatory tax rules for investments in residential property to let

The European Commission has formally requested France to amend provisions which allow investments in new residential property situated in France to benefit from accelerated depreciation, but do not allow the same for similar investments abroad. The Commission considers such provisions to be incompatible with the free movement of capital, a fundamental principle of the EU's Single Market. The request takes the form of a Reasoned Opinion (the second step of an infringement procedure). In the absence of a satisfactory response within two months, the Commission may refer France to the European Court of Justice.

The French tax provisions1 allow accelerated depreciation to be applied to new residential property in France which is intended for letting for a minimum of 9 years. This results in favourable tax treatment for these investments.

By contrast, a French taxpayer who invests in residential property to let in another Member State or an EEA country cannot benefit from accelerated depreciation, and hence cannot enjoy these tax benefits.

Such provisions are incompatible with the free movement of capital as guaranteed by Article 63 of the Treaty on the Functioning of the European Union and Article 40 of the EEA Agreement, as they dissuade resident taxpayers from investing in immovable property situated abroad.

In a similar case, the EU's Court of Justice (C-35/08, Busley from 15 October 2009) has confirmed that such discriminatory tax treatment is in breach of EU rules on the free movement of capital.

For the press releases issued on infringement proceedings in the area of taxation or customs see:

For the most up-to-date general information on the infringement proceedings initiated against Member States, see:

For more information on EU infringement procedures, see MEMO/11/86

1 :

Known as amortissement Périssol, amortissement Besson, amortissement de Robien and amortissement Borloo neuf.

Side Bar