EU Commission recommends not granting financial support to companies with links to tax havens

On 14 July 2020, the European Commission issued a recommendation to Member States that they do not grant financial support to companies with links to countries that are on the EU’s list of non-cooperative tax jurisdictions.

The recommendation also includes that restrictions should also apply to companies that have been convicted of serious financial crimes, including, among others, financial fraud, corruption, non-payment of tax and social security obligations.

The recommendation is intended to provide guidance to Member States on how to set the conditions applicable to the provision of financial support so as to prevent the misuse of public funds and to strengthen safeguards against tax abuse throughout the EU, in line with EU laws. The coordination of restrictions on financial support should also prevent mismatches and distortions within the Single Market.