Size Matters: Discriminatory Intent and Discriminatory Impact in EU Law
Posted: 11 Jan 2019
Date Written: December 31, 2018
This Article explores whether classifications based on company size constitute covert nationality discrimination that violates EU law.
We use company-size classifications to explore the role of disproportionate impact and legislative intent in judicial review of Member State laws for nationality discrimination. Our discussion of disproportionate impact is mostly descriptive—we explore how the Court has resolved questions of quantum and proof in the cases. Our discussion of intent is mostly normative—we argue, contrary to current doctrine, that courts should consider the legislature’s intentions as probative, but not dispositive, of discrimination.
We chose company size for two reasons. First, discussion of company size as covert nationality discrimination is new to the literature. Second, Member States increasingly use company-size classifications in tax laws; Poland and Hungary recently used turnover (as opposed to net income) to determine tax rates; and several states propose to use turnover to establish liability for digital services taxes.
Keywords: EU law, digital services tax, disproportionate impact, company size, discriminatory intent
JEL Classification: K34
Suggested Citation: Suggested Citation