Netherlands fiscal unity between Netherlands subsidiaries not possible when held by non-EU entities. Hoge Raad: rejects application of tax treaty non-discrimination clause

The Hoge Raad (Dutch Supreme Court) has given a judgment in a fiscal unity case with two Netherlands sister companies and an Israeli parent company. The Netherlands Supreme Court (incorrectly) rejected the application of the tax treaty non-discrimination provision. Therefore, forming a fiscal unity between Netherlands entitities that are related through a foreign entity only remains possible if these foreign entities are a resident of an EU Member State.