Felixstowe Dock and Railway Company v HMRC

In Felixstowe Dock and Railway Company v HMRC (C-80/12 – 1 April 2014) Felixstowe (a UK company) was in a consortium of companies with Hutchison 3G (also a UK company) as they were both connected with Hutchison Sàrl (a Luxembourg company). Hutchison Sàrl was therefore the ‘link company’ for the purposes of consortium relief (ICTA 1988 s 406(1)).

Felixstowe’s claim for consortium relief in relation to losses made by Hutchison 3G was rejected by HMRC on the grounds that the link company was not resident in the UK and did not carry a trade in the UK through a permanent establishment.

The CJEU noted that there was a difference in treatment between consortium companies connected by a link company established in the UK and those connected by a link company established in another member state. Furthermore Philips Electronics (C-18/11) was authority for the proposition that the principle...