The Austrian CFC regime according to Sec 10a CITA is characterized not only by EU secondary law requirements (Arts 7 and 8 ATAD), but also by requirements of EU primary law. The restrictions on the freedom of establishment and the free movement of capital as well as their justifications play a major role in the design of CFC rules. The requirements of the CJEU case law must be given special consideration. In particular, the cases Cadbury Schweppes, X, as well as Eqiom are relevant for the design of the substance carve-out. The two lines of case law in Cadbury Schweppes and Eqiom must be regarded as complementary. The substance test of the Austrian CFC legislation raises interesting questions, e.g. in connection with the burden of proof and the prima facie evidence. Martin Klokar analyzes whether Austria’s implementation of the ATAD’s CFC rules in Sec 10a CITA is compatible with the standards developed by the CJEU.
