EU Gets Green Light to Continue Fight Over Favorable Tax Rulings

The EU’s lower appeals court signaled its support for European Union regulators’ efforts to police favorable tax rulings multinationals get from individual countries.

Europe’s General Court validated the European Commission’s use of transfer pricing principles to evaluate tax rulings in two cases Sept. 24, involving Starbucks Corp. and Fiat Chrysler Automobiles NV. Transfer pricing determines the value of a multinational group’s intercompany transactions.

The court upheld the commission’s decision that Fiat should have paid more tax in Luxembourg—that is, it received about 30 million euros ($33.1 million) in illegal state aid from that country—even as it overturned the commission’s ruling ...