In Case C-158/25 (QJ v the Luxembourg Registration Duties, Estates and VAT Authority (Administration de l'enregistrement, des domaines et de la TVA) ("AEDT")), Advocate General Medina proposes in her Opinion of 5 March 2026 that the CJEU grants company directors subject to a guarantee call the right to incidentally contest the ex officio tax assessment issued against the company. A ruling in line with this Opinion could profoundly reshape Luxembourg practice.
Applicability of Article 47 of the Charter to the guarantee call mechanism
The first preliminary question referred by the Luxembourg Supreme Court (Cour de cassation) seeks to determine whether Article 47 of the Charter applies to the joint liability mechanism for company directors provided for under Articles 67-1 et seq. of the LTVA. The Luxembourg Court of Appeal (Cour d'appel) had held that these provisions did not constitute an implementation of EU law and had rejected this plea. The Luxembourg government contested the application of Article 47 on the ground that Articles 67-1 et seq. of the LTVA do not constitute fiscal sanctions but rather specific rules on civil liability.
The Advocate General dismisses these arguments and concludes that the mechanism constitutes an implementation of EU law within the meaning of Article 51(1) of the Charter. She notes in particular that:
- Member States are required, under Articles 2 and 273 of Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (VAT Directive), read in conjunction with Article 4(3) TEU and Article 325(1) TFEU, to ensure the full collection of VAT;
- a joint liability mechanism enabling the recovery of unpaid VAT from a director directly contributes to that objective; and
- the characterisation of the mechanism under national law as falling within civil liability is irrelevant, provided that the amount claimed corresponds to the unpaid VAT.
As per her Opinion, Article 47 of the Charter should therefore be applicable in the context of the director's appeal against the guarantee call.
Right to contest incidentally the ex officio tax assessment
The second and third preliminary questions concern whether Article 47 of the Charter precludes a national practice preventing the director from contesting incidentally the ex officio tax assessment that has become final, and the scope of the pleas that may be raised.
The Advocate General considers that the current restriction – limiting the director's defence to the conditions of his own liability (fault, damage, causal link) without allowing him to challenge the amounts in the ex officio tax assessment – infringes the essential content of the right to an effective remedy:
- the ex officio tax assessment produces a binding effect on the director, a third party who was neither the addressee of the act nor a party to the tax assessment procedure;
- relying on the Adler Real Estate judgment (C-546/18), the Advocate General emphasises that the rights of the defence are subjective in nature: the director must be able to exercise them personally, irrespective of any possibility of acting on behalf of the company;
- the director and the company are legally distinct entities with potentially divergent interests.
As to the scope of the pleas available, the Advocate General proposes a nuanced solution:
- the director must be able to contest incidentally the factual circumstances and legal assessments established in the ex officio tax assessment, insofar as they are decisive for the outcome of the proceedings against him;
- however, the director may not invoke, in his own name, a breach of the company's rights of defence, nor demand to be personally involved in the ex officio tax assessment procedure; and
- the professional secrecy argument is dismissed, since the contested elements relate to events of which the director necessarily had knowledge by virtue of his functions.
Implications for Luxembourg practice
Under current Luxembourg law, a director subject to a guarantee call has no personal remedy against the ex officio tax assessment issued to the company. Once that assessment has become final, the amounts stated therein can no longer be challenged, and the director can only defend his interests based on his personal fault.
A CJEU ruling in line with the Advocate General's Opinion would require Luxembourg courts to allow the director to contest incidentally the factual findings and legal assessments in the ex officio tax assessment. In particular the current case law of the Court of Appeal, which denies the director any defence relating to the existence or amount of the tax debt, would need to be revisited;.
Further, a broad interpretation could have repercussions in the field of direct taxation, where an analogous guarantee call mechanism exists under § 119 of the General Tax Law of 22 May 1931, as amended (Abgabenordnung), on the basis that Article 47 of the Charter would similarly entitle the director to contest incidentally, in his own right, any ex officio tax assessment issued against the company.
However, an alternative approach appears possible to avoid granting the director a dual avenue of challenge: issuing the guarantee call bulletins concurrently with the ex officio tax assessment.
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