Stamp Tax on Intercompany Loans: CAAD Arbitration on Verba 17.1.4 TGIS (2014)

ARBITRATION DECISION

Claimant: A, a public limited company with registered office in ..., parish of ..., ..., with registration number and collective person number ..., hereinafter referred to as Claimant or A

Respondent: Tax and Customs Authority, hereinafter referred to as AT

I. REPORT

1. The Claimant filed, on 9 January 2014, a request for constitution of a collective arbitral tribunal in tax matters, which was accepted, seeking a declaration of illegality of the tax acts for assessment of Stamp Duty (SD, hereinafter) for the years 2009 and 2010, relating to the application of item 17.1.2 and 17.1.4 of the General Table of Stamp Duty (hereinafter "GTSD") to a set of financial operations identified in the Request below, requesting the annulment of the SD assessments as well as the payment of compensatory interest in its favour.

2. The tax acts subject to the request for arbitral pronouncement are as follows:

   a. Assessment of Stamp Duty 2009 no. 2013 ..., notified electronically to the Claimant on 19/08/2013 which set the value of stamp duty payable at € 37,168.57 plus compensatory interest of € 5,455.65;

   b. Assessment of Stamp Duty 2010 no. 2013 ... notified electronically to the Claimant on 19/08/2013 which set the value of stamp duty payable at € 57,380.68 plus compensatory interest of €6,586.27;

3. On 17 February 2014 the Finance Directorate of ... came to consider that, regarding the year 2009, stamp duty had been assessed as outstanding whose assessment was not notified to the taxpayer within the period of four years from the respective tax event in accordance with the provisions of article 45 of the General Tax Code (GTC) combined with nos. 5 and 39 no. 1 of the Stamp Duty Code.

4. In these terms it decided to partially revoke the dispatch of 26 June 2013, which sanctioned the Tax Inspection Report and determined the assessment of stamp duty relating to the facts concerning the year 2009, annulling stamp duty, due to expiry of the right to assess, in the following amounts:

   i. Loans to parent company within item 17.1.4 of the GTSD - € 7,007.68

   ii. Loans to C within item 17.1.2 of the GTSD - € 10,500.00

   iii. Loans to D within Item 17.1.4 of the GTSD - € 2,322.23.

5. Maintaining the stamp duty assessments relating to the loans of the year 2009 in the total amount of € 17,338.66, itemized as follows:

1. As well as the stamp duty assessments notified to the taxpayer with reference to the year 2010.

2. The Claimant, notified of the decision to partially revoke the stamp duty assessment act for 2009, decided to pronounce on the same, under the final part of no. 2 of article 13 of the Regulation of Tax Arbitration (RTA), maintaining the interest in continuing the proceedings.

3. Pursuant to the provisions of subparagraph a) of no. 2 of article 6 and subparagraph b) of no. 1 of article 11 of Decree-Law no. 10/2011, of 20 January, in the wording given to it by article 228 of Law no. 66-B/2012, of 31 December, the Deontological Council of the Administrative Arbitration Centre designated as arbitrators Jorge Lino Ribeiro Alves de Sousa (arbitrator-president), António Martins and Ana Teixeira de Sousa, who accepted the appointment, and the parties, after being duly notified, did not express opposition to this designation.

4. Thus, in accordance with the provisions of subparagraph c) of no. 1 of article 11 of Decree-Law no. 10/2011, of 20 January, in the wording given to it by article 228 of Law no. 66-B/2012, of 31 December, the collective arbitral tribunal was constituted on 12 March 2014.

5. The senior official of the Tax and Customs Authority (hereinafter referred to as AT or "Respondent") was notified to, if it so wishes, within 30 days, submit a reply and request additional evidence production, a reply was submitted on 9 April 2014, signed by the legal counsels Mrs. ... and ..., on behalf and in representation of the Respondent.

6. The Claimant came on 16 April to request the attachment to the proceedings of the documents identified in the initial petition.

a. The translation of Doc. no. 3 attached to the Initial Request – contract between company C and the Claimant of 24/03/2009 for acquisition from C of the shares representing the entirety of the share capital of company D, SARL

b. The Document mentioned in subparagraph s) of article 34 of the IR and its translation – loan agreement executed on 31/03/2009, which evidences the transfer of an amount of € 1,600,000.00 from B in favour of A;

c. The Document mentioned in subparagraph hh) of article 34 of the IR and its translation – loan agreement executed on 21/07/2009 which evidences the transfer from B to A of the financial means for A to advance to C the sum of € 3,500,000.00 on account of the option to purchase an industrial property located in ... .

1. The tribunal, by dispatch of its president, of 17 April 2014 notified the AT of the attachment of the documents delivered by the Claimant.

2. On 22 April the meeting provided for in article 18 of the RTA was held.

3. In the meeting it was agreed that the examination of witnesses would be dispensed with.

4. The tribunal gave a period of 10 days to the Respondent to pronounce on the documents attached to the proceedings by the Claimant on 17 April.

5. The AT, on 30 April 2014 presented a request to sustain the rejection of the documentation presented by the Claimant.

6. The tribunal decided that the final decision would be presented by 17 June, but given the complexity of the situation, it was postponed, with the date of delivery of the decision being extended until 12 September.

Due to illness of the President of the Arbitral Tribunal it was not possible to deliver the decision by that date.

With that situation of illness persisting, by dispatch of the President of the Deontological Council of CAAD, the temporary replacement of the President of the Arbitral Tribunal by Cons. Jorge Lopes de Sousa was determined.

1. The Request for Arbitral Pronouncement

Summarizing, the grounds presented by the Claimant are as follows:

• The Claimant is a company whose object is the purchase, sale and resale of real estate;

• The Claimant is held in a relationship of control by B (B, hereinafter), with registered office in Hong Kong which holds 99.96% of its share capital with which it carried out various operations of a financial nature;

• The following companies are part of the same business group:

  i) C;
  ii) E;
  iii) F;
  iv) G;
  v) H;
  vi) D (this one with registered office in Poland)

• These companies have cross-shareholdings being held directly or indirectly by Mr. X and family;

• Following the opening of an inspection procedure by the AT, the Tax Inspection Report (TIR) was produced and communicated to the Claimant by the Finance Directorate of ... on 26/06/2013.

• The notifications of the assessments contested were deposited in the electronic mailbox (Via CTT) of the Claimant on 19/08/2013 with a period for voluntary payment ending on 11/10/2013.

• The Claimant made the payment of the tax required of it, despite disagreeing with the assessments because it considered them illegal;

• The Claimant paid the amount of SD subject to the assessments, of € 37,168.57 (relating to 2009) and € 57,380.68 (relating to 2010) having opted to regularize the payment of the tax under Decree-Law no. 151-A/2013, of 31 October, whereby the payment of compensatory interest was dispensed with.

• The Claimant understands that, having the contested assessments been deposited in its mailbox on 19/08/2013 and not having accessed its mailbox on that day or on any of the following 25 days, the notification of the assessments is considered effected only on 13/09/2013, in accordance with the provisions of nos. 9 and 10 of article 39 of the Code of Tax Procedure and Process (CTPP), relating to the date on which notifications by electronic data transmission are considered to have been effected.

• Whereby, considering the four-year period of expiry of the tax, all assessments should be considered null in the part relating to tax facts occurring before 13/09/2009.

• In the tax inspection report (TIR) the financial operations on which the AT came to assess SD operations are grouped and analyzed within the following classification scheme:

  a) Contracting of loans from parent company

  b) Conclusion of loans with third-party companies

  b.1) Agreements with company C
  
  b.2) Agreements with company F and G
  

  c) Loan made to company D

  d) Loan made to company C

• With regard to "Contracting of Loans from parent company" the Claimant, relying on documents which, with the Initial Petition (IP), are brought to the Proceedings, alleges that the AT, with respect to these "Contracting of loans from parent company" operations, always incurs in an error of qualification of the tax facts. Thus it would be because the said documents would prove that the various operations in question – analyzed hereinafter – which would total the value of € 9,235,516.00, showed determined dates for their beginning and end, and would not therefore be qualifiable under SD as "for an indefinite period".

• Actually, the amount of the 2009 balance of € 7,719,516.00 of which B (B) was creditor of the Claimant relates to the following operations:

1st - the credit of B over A, in the value of € 2,888,667.00, results from a credit assignment made on 01/03/2009 relating to two credits – and respective interest – that B had contracted with C on 14/03/2008 and 01/08/2008 with maturity dates for 20/07/2008 and 31/07/2008.

On the date of the assignment of these credits to A, now Claimant, the maturity date of the first operation was extended from 20/07/2008 to 31/03/2009.

The Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.1 of the GTSD (credit assignment granted for a period of less than 1 year in the case of the first contract (which it attaches with the initial petition) as well as the extension of its maturity and, in the case of the amounts assigned relating to the second contract (which it also attaches) SD provided for in Item 17.1.2, relating to credit assignment for a period of more than 1 year.

In any case the Claimant understands that SD is due on the date of the assignment of the credits and on the date of the extension of the maturity of one of them, namely, on 01/03/2009. As the assessment of SD was notified to the Claimant more than 4 years after this date, the AT's right to assess this tax had already expired.

The Claimant attached to the initial petition the documents that evidence the loan/advance contracts concluded between B, C and D, as well as their translations into Portuguese.

2nd The credit in the amount of € 741,500.00 of B over the Claimant results from an assumption of debt made by A as price/consideration given to E from a credit assignment that it made to it on 01/03/2009, relating to two credits and respective interest that E had over C and over D since 31/05/2008.

On the date of the assignment of these credits to A, maturity dates were fixed for 31/12/2009 (D's debt) and 31/03/2009 (C's debt).

The Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.1 of the GTSD (credit assignment granted for a period of less than 1 year).

The Claimant understands that SD is due on the date of the credit assignment, namely, on 01/03/2009. Having the assessment of SD been notified to the Claimant more than 4 years after this date, the AT's right to assess this tax had already expired.

3rd The amount of € 1,600,000.00 concerns a transfer from B in favour of A, made on 01/04/2009 with the objective of financing the Claimant to pay the price of acquisition from C of the shares representing the entirety of the share capital of the company with registered office in Poland, D.

The Claimant alleges that this transfer was made under a shareholder loan agreement, executed for a period of 5 years, with a scheduled repayment date of 31/03/2014 and protests to attach a copy of said contract.

The Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.3 of the GTSD (grant of credit for a period of more than 5 years).

The Claimant understands that SD is due on the date of the grant of credit, namely, on 01/03/2009. Having the assessment of SD been notified to the Claimant more than 4 years after this date, the AT's right to assess this tax had already expired

4th Another part of the 2009 balance relates to three transfers received by A from B, in a total of € 2,500,000.00, as follows:

i. € 1,100,000.00 on 27/07/2009

ii. € 1,200,000.00 on 28/08/2009

iii. € 200,000.00 on 28/12/2009

Through which B aimed to provide A with the financial means to carry out a financing to C, in a global amount of € 3,500,000.00 in which it would receive the financing with an option to purchase an industrial property located in ....

This advance operation from B to A is evidenced by a shareholder loan agreement dated 21/07/2009 which provides for the delivery of the amounts by A to C and fixes the repayment period as 31/07/2011.

The Claimant protested to attach the contract and its translation, which it subsequently did on 17 April.

The Claimant understands that this is a credit operation and that, under subparagraph g) of no. 1 of article 5 of the Stamp Duty Code the tax obligation is considered "... constituted, in credit operations, at the moment they are made".

Concluding the Claimant that "in a loan contract with a determined value, even if providing for successive tranches of utilization, the tax fact arises with the signing of the contract, with SD being due at that moment, for the maximum value of financing contracted.

The Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.2 of the GTSD (grant of credit for a period of more than 1 year).

The Claimant understands that SD is due on the date of the conclusion of the financing contract, namely, on 21/07/2009. Having the assessment of SD been notified to the Claimant more than 4 years after this date, the AT's right to assess this tax had already expired.

• In 2010 there is a value of € 1,520,000.00 of credit entries from B made in the accounting of A justified by the Claimant as follows:

1st Two entries in the amount of:

€ 660,000.00 on 04/03/2010 and

€ 340,000.00 on 24/05/2010

Which correspond to the two last utilizations of the financing obtained from B to advance to C and which were effectively advanced.

These are thus the two tranches of a global financing contracted between B and A on 21/07/2009 and with a period for full repayment on 31/07/2011.

The Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.2 of the GTSD (grant of credit for a period of more than 1 year).

The Claimant understands that SD is due on the date of the conclusion of the financing contract, namely, on 21/07/2009, the date on which the tax fact arises. Having the assessment of SD been notified to the Claimant more than 4 years after this date, the AT's right to assess this tax had already expired.

2nd Transfer of the value of € 520,000.00 made on 11/06/2010 by B in favour of the Claimant

This transfer was made under a "Shareholder's Loan Agreement and Authorisation" concluded between B and the Claimant on 09/06/2010 and with a repayment period fixed for 31/08/2011.

Once again the Claimant understands that SD could not have been assessed under Item 17.1.4 of the GTSD, as a current account operation for indefinite period, but possibly SD under Item 17.1.2 of the GTSD (grant of credit for a period of more than 1 year).

The Claimant understands that SD is due on the date of the conclusion of the financing contract, namely, on 09/06/2010, the date on which the tax fact arises, applying the rate of 0.5% to the entirety of the committed financing.

Whereby only the value of € 2,600.00 is due which should have been assessed and paid a single time, with reference to 09/06.

• With regard to agreements with C the Claimant sustains that the loan agreement with option to purchase real property that it established with C on 24/07/2009 and with a maturity date of 31/07/2011 constitutes the tax fact.

• Thus, the fact that the loan is made available in tranches should not affect this framework, whereby the stamp duty would be due on the date of the conclusion of the contract.

• The AT made the assessment of stamp duty based on item 17.1.2 of the GTSD on each of the tranches utilized.

• The assessment is contested by the Claimant, alleging that the tax fact would have arisen on 2009-07-24 (date of contractualization of the credit); thus the right to assessment had already expired as of the date of notification to the taxpayer of at least the amounts of tax calculated for 28/07/2009 (€ 5,500.00) and 02/09/2009 (€ 5,000.00).

• With regard to "Agreements with company F and G – ..., SA" these correspond to resolutions of the general assembly of F, G and the Claimant, all dated 31/03/2010, which demonstrate that the object of the transfer by A of the amount of € 280,000.00 to F and of the amount of € 240,000.00 to G corresponded to the payment of the price of two properties, to be acquired by A from each of these companies, according to the content of the minutes of the general assemblies of the three companies.

• Notwithstanding that the deeds of acquisition of these properties, with advance payment of the price, were not formalized, this cannot convert A's credit rights into loan operations.

• The Claimant contests the assessment of stamp duty under item 17.1.4 of the GTSD, as a credit operation in current account for indefinite time, alleging that these are advances on account of an item relating to the price established for the purchase of the properties, and not a credit operation in which A appears as creditor and the other entities as debtors of these funds.

• Regarding the alleged loan to Polish company D the Claimant understands that this is not any financing operation carried out by A in favour of D nor is it any grant of credit in current account.

• As results from the share purchase and sale agreement (attached as document 3), concluded on 24/3/2009, between A and C, the first of these companies acquired from the second the entirety of the shares representing the share capital of D for the price of € 3,355,000.00.

• But, together with those shares, A also became holder of a credit over D in the amount of € 2,095,205.00, which translated into the shareholder credit that C held over that investee.

• This is not, therefore, any financing operation carried out by A in favour of D, nor is it any grant of credit in current account.

• But, even if it were, A's credit arises with its acquisition, on 24/03/2009, with the notification of the assessment exceeding the period of expiry of stamp duty.

• Regarding "Loan made to company C", the AT considered that A was creditor, in 2010, of an amount of € 354,081.00 in which was included a transfer to C made on 31/05/2010 in the amount of € 340,000.00.

• The Claimant contests this understanding, alleging that "(…) the transfer was nothing more than the transfer of the last tranche of the advance of € 3,500,000.00 made by A to C".

• Moreover, it states that "(…) this amount was transferred to the advance account on 31-12-2011". Now, the Claimant also sustaining that such tranche or effective availability of funds should not give rise to taxation, alleging (similarly to what was mentioned above) that the tax fact would have arisen on 2009-07-24 (date of contractualization of the credit); then the AT's right to assessment would have been expired as of the date of notification to the taxpayer (2003-09-13) of the tax facts

• Concluding the Claimant that the assessment of stamp duty 2009 is totally compromised based on the incorrect qualification of the tax facts and based on the expiry of the right to assessment of tax.

• And that the assessment of 2010 is equally compromised with the same grounds, with the claimant being able to agree to an imposition of stamp duty in the value of € 2,600.00 inciding on the availability of financial means by B to A for the purpose of payment of real property to F and G under item 17.1.2 of the GTSD.

1. Response of the AT

• With regard to "Contracting of loans from parent company" it is sustained in the TIR that the accounting of the Claimant evidenced, in 2009, an amount of shareholder contributions that reached € 7,719,516.00. Already in 2010 the amount of shareholder contributions would have reached € 1,520,000.00. This means, as also expressed in the TIR, that in December 2010 the accumulated value of these shareholder contributions reached € 9,235,516.00.

• The TIR shows that, regarding the total of € 9,235,516.00, only documentary evidence was obtained for two items that integrate such global amount. It does so in the following terms:

"Regarding these operations established between B and A there is no written contract nor any other equivalent document, such as a board meeting minute where the conditions for the realization of these financial operations are described and defined, what their objective, period, repayment conditions and any interest payments are.

Even after a new request made for the same purpose the taxpayer persisted in the lack of response to the request for the sending of the contract (annex 3).

It was only possible for us to verify that, of the €9,239,516.00, the amounts of €741,500 and €2,888,667.00 result from two contracts (annex 4), relating respectively, to the cession of credits for A that company E with the NIPC ... held in the amount of €741,500 over companies D and C, as well as the cession of position that B made to A for credits it held in company C."

• Thus, the AT, alleging that despite requests to the Claimant it did not obtain information about the conditions of realization, objectives, periods and repayment conditions, qualifies the entirety of the amount as shareholder contributions – as thus appeared in the accounting of the Claimant - being classifiable under item 17.1.4 of the General Table of Stamp Duty (GTSD), which provides:

"17.1.4-Credit utilized in the form of current account, bank overdraft or any other form in which the period of utilization is not determined or determinable, on the monthly average obtained through the sum of the debt balances assessed daily, during the month, divided by 30".

• In the Reply, the AT understands that the documents attached by the Claimant with the IP are not susceptible to constitute means of proof, whereby it maintains the qualification of the credit as for indefinite period.

• With regard to "Agreements with company C", it is stated in the TIR that:

"A established on 2009-07-24 a loan agreement with option to purchase land and factory buildings and obligation to lease (annex 6) with company C (hereinafter referred to as C). This agreement provided that A grant a short-term loan to C of a maximum of €3,500,000.00 with partial deliveries respectively of €1,100,000.00 within two weeks after the signing of the agreement, €1,200,000.00 until 2009-09-15 and €1,200,000.00 until 2009-12-31. Although this denomination of "short-term loan" was attributed, the fact is that the period provided for in the contract covered a period of time exceeding one year, already since the possibility of repayment was given until 2011-07-31, a date that did not turn out to be complied with.

The grant of this loan provided for the payment of interest at the annual rate of 3%, having been agreed that the date for the repayment of the loan made would be 2011-07-31."

• Until the repayment date provided for in the loan agreement concluded on 24/07/2009, which would be until 31/07/2011, no repayment of the loan occurred.

• The relevant tax fact for the discussion is that of "utilization of credit", with the tax obligation arising on the date such utilization occurs or, when the period is not determined nor determinable, on the last day of each month.

• Thus, the AT assesses SD through the application of article 2, subparagraph b) of the SD Code and item 17.1.2 of the same Code, inciding on the credit tranches, or funds ceded, by the Claimant to C.

• With regard to "Agreements with company F and G – ..., SA" the TIR sustains that (p.8):

"From the analysis of the accounting elements of A it is verified the entry in account 27811 -Other debtors and creditors -various debtors -nationals of the amount of €520,000.00, relating to two operations carried out respectively with companies F (hereinafter referred to as F) and G -... SA (hereinafter referred to as G) in the amounts of €280,000.00 and €240,000.00 respectively.

In clarifications provided by A (annex 9), we note that these amounts result from resolutions set out in the minutes of shareholders assembly, through which reciprocal intentions are manifested of the two companies previously identified and A, to proceed with the alienation/acquisition of the property belonging to those.

(…)

A was questioned (annex 10), in order to clarify whether there were other documents that materialized the intention to buy and sell Real Estate, namely promise of purchase and sale agreements or evidence of exchange of information between the companies that proved the Intention to conclude the business. Its existence was not demonstrated, although in the response to the e-mail reference is made to "attached", only provided evidence of the transfers.

Faced with this situation, it is verified that in fact we are faced with two situations of financing by A to companies F and G, which would allow them to meet the need for financial resources to meet their commitments and allow them to close the activity, as is also described in minute no. 27 of G."

• Thus, the AT assessed SD, based on item 17.1.4 of the GTSD, on the amounts transferred from A to the two entities in question.

• With regard to "Loan made to company D" it is mentioned in the TIR that (p. 10):

"Analyzed the analytical trial balance of the company for the year 2010 and more specifically account 4113011 Financial Investments -Loans Granted -Group Companies -D SP. Zo, there is verified the existence of a debit balance of €1,193,130.00.

Company D is a company domiciled in Poland, being held 100% by A.

The balance presented at the end of 2010, is the result of two transfers in the amounts of € 704,925.00 and €2,095,205.00 (totaling €2,800,130.00) made in March 2009, with a first repayment of €907,000.00 occurring on 2009-05-20. On 2010-12-15 a new repayment was made in the amount €700,000.00, thus resulting in a balance still owed in the amount of €1,893,130.00.

The company was requested to send us a copy of the contract regulating the grant of the loans and evidence thereof (annex 12), no information having been exhibited to us.

Once again and similarly to what is described in items 2.a) and 2.b) we are faced with financing operations subject to taxation under stamp duty, whose tax was not assessed and remitted"

• Based on such qualification, the AT assessed SD, by item 17.1.4 of the GTSD.

• Regarding "Loan made to company C", it is alleged in the TIR (p. 11).

"In account 278111 -Other debtors and creditors -various debtors -national - C -, the amount of €354,081.00 is entered on the debit side. Clarifications were requested about the nature of these operations, namely, the sending of a copy of the documents relating to the loans made as well as evidence of the transfers made as materialization of such loans.

the amount evidenced in the December 2010 trial balance presents the amount of € 354,081.00, which includes the amount of €340,000.00 (annex 14) relating to a transfer made by A to C, on 2010-05-31. The taxpayer did not justify the nature of this operation nor sent the evidence of the operations, but it should be considered realization of a financing operation to C, already that between C and A there is no commercial relationship whatsoever, except that which flows from the contract concluded between them and better described in item 2.a) of this report, and which was considered as a financing operation."

• The AT thus applies to this operation item 17.1.4 of the GTSD.

II. PROCEDURAL MATTERS

1. The arbitral tribunal is materially competent, in accordance with the provisions of article 2, no. 1, al. a) of the Regulation of Tax Arbitration (RTA).

2. The parties have legal personality and capacity and have standing in accordance with article 4 and no. 2 of article 10 of the Regulation of Tax Arbitration (RTA), and article 1 of Ordinance no. 112-A/2011, of 22 March.

3. The proceedings are not vitiated by any nullity nor have any exceptions been raised by the parties that prevent the examination of the merits of the case, whereby the conditions for the delivery of the arbitral decision are met.

III. LEGAL REASONING

Proven Facts

1. Based on the documents attached by Claimant (request for arbitral pronouncement, Doc. no. 1 and following attached with that Request; Response of the AT), the following facts are established:

2. • The Claimant is a company whose object is the purchase, sale and resale of real estate;

3. The Claimant is held in a relationship of control by B (B, hereinafter), with registered office in Hong Kong which holds 99.96% of its share capital with which it carried out various operations of a financial nature;

4. The notifications of the SD assessments contested were deposited in the electronic mailbox (Via CTT) of the Claimant on 19/08/2013 with a period for voluntary payment ending on 11/10/2013.

5. The Claimant made the payment of the tax required of it, in the amount of € 37,168.57 (relating to 2009) and € 57,380.68 (relating to 2010) having opted to regularize the payment of the tax under Decree-Law no. 151-A/2013, of 31 October, whereby the payment of compensatory interest was dispensed with.

6. The Claimant did not access its mailbox on 19/08/2013 nor on any of the following 25 days.

7. The credit of B over A, in the value of € 2,888,667.00, results from a credit assignment made on 01/03/2009 relating to two credits – and respective interest – that B had contracted with C on 14/03/2008 and 01/08/2008 with maturity dates of 20/07/2008 and 31/07/2008.

8. On the date of the assignment of these credits to A, now Claimant, the maturity date of the first operation was extended from 20/07/2008 to 31/03/2009.

9. The credit in the amount of € 741,500.00 of B over the Claimant results from an assumption of debt made by A as price/consideration given to E from a credit assignment that it made to it on 01/03/2009, relating to two credits and respective interest that E had over C and over D since 31/05/2008.

10. On the date of the assignment of these credits to A, maturity dates were fixed for 31/12/2009 (D's debt) and 31/03/2009 (C's debt).

11. Company D is a company domiciled in Poland being held from March 2009 by A.

Unproven Facts and Respective Reasoning

1. It was not proven that the balance of € 1,600,000 concerns a transfer from B in favour of A made on 01/04/2009 with the objective of financing this company to pay for the acquisition from C of the shares representing the entirety of the share capital of company D.

2. Actually, this acquisition of shares, as well as the shareholder loan agreement, from B to A, in the amount of € 1,600,000.00, are evidenced by a document – agreement – that could not even have been considered in the impugned assessment as it was not presented during the tax inspection but only with the initial petition of these proceedings.

3. Moreover, this document cannot by itself demonstrate that the amount of € 1,600,000.00 was transferred on 01/04/2009 with said objective of financing the acquisition of the shares representing the entirety of the share capital of D.

4. The shareholder loan made by B to A dated 21/07/2009 which provides for the availability of amounts to be delivered by A to C in 2009 and 2010 was not proven.

5. This shareholder loan agreement, from B to A, in the maximum amount of € 3,500,000 was only attached after the delivery of the initial petition, whereby it also could not have been taken into account in the impugned assessment.

6. It was not proven that the transfers made by the Claimant to F SA and to G, in the amount of € 280,000 for the first company and € 240,000.00 for the second, corresponded to an advance payment of two properties, given the lapse of time between the resolutions in the minutes of the general assemblies and the transfer of the amounts to the two companies, the non-existence of any promise agreement or of any diligences aimed at the realization of the purchase and sale agreement, among others.

7. It was not proven that the debtor balance of company D to the Claimant did not correspond to any financing operation or is not a grant of credit in current account.

Legal Reasoning

1. It results from the positions of the Parties that the essential question in these proceedings consists in knowing whether the various financial operations of which the Claimant is a party constitute a grant of credit for purposes of the Stamp Duty Code, namely for purposes of the application of Item 17.1 of the GTSD and, if so, whether or not the AT's right to assess stamp duty has expired in accordance with articles 45 of the GTC and 39 of the Stamp Duty Code.

2. In this regard, the following provisions of the Stamp Duty Code are relevant:

Article 1
Objective Scope

1 - Stamp duty is charged on all acts, contracts, documents, titles, papers and other facts or legal situations provided for in the General Table, including gratuitous transfers of property.

Article 2

Subjective Scope

1 - The following are passive subjects of the tax:

a) …………..

b) Entities granting credit and guarantee or creditors of interest, premiums, commissions and other consideration

Article 3

Burden of Tax

1 - The tax constitutes a burden on the holders of the economic interest in the situations referred to in article 1

2 - In case of economic interest common to several holders, the burden of the tax is divided proportionally among all of them.

3 - For purposes of no. 1, is considered holder of the economic interest:

a) ……………………………

f) In the grant of credit, the user of credit;

Article 7

Other Exemptions

1 - The following are also exempt from tax:

a) …….

b) …….

c) …….

d) ……….

f) …………………

g) Financial operations, including respective interest, for a period not exceeding one year, provided they are exclusively intended to cover treasury shortages and carried out by venture capital companies (VCC) in favor of companies in which they hold shareholdings, as well as those carried out by other companies in favor of companies dominated by them or companies in which they hold a shareholding of at least 10% of capital with voting rights or whose acquisition value is not less than (euro) 5,000,000, according to the last agreed balance sheet and, as well as carried out for the benefit of company with which it is in a relationship of control or group; (

h) The operations, including respective interest, referred to in the preceding subparagraph, when carried out by holders of share capital to entities in which they hold directly a shareholding not less than 10% and provided that this has remained in their ownership for one consecutive year or since the constitution of the investee entity, provided that, in the latter case, the shareholding is maintained during that period;

i) Loans with characteristics of shareholder contributions, including respective interest made by shareholders to the company

1. For its part, item 17 of the GTSD establishes the following taxation rules for financial operations:

1. In order to elucidate the question under analysis, one must begin by framing credit operations within SD. For this, the law, legal doctrine and arbitral decisions on this same tax will be very relevant. And such framing must respond to the following essential question: from the combination of article 5, subparagraph g) of the SD Code, with the text of item 17 (in particular item 17.1 of the GTSD) what conditions must be verified for the actual subjection to SD of credit operations?

2. As emphasized by J. Silvério Mateus and L. Corvelo de Freitas, "The Taxes on Property. Stamp Duty: Annotated and Commented", Lisbon, Engifisco, 2005, p.734 "The tax event of the tax obligation is, according to subparagraph g) of article 5, the utilization of credit, with special duties not being levied as long as such utilization does not occur."

3. The authors further emphasize that the text of item 17.1, clarifying the concept of credit utilization and integrating into it credit assignment operations, imposes the condition that these involve any type of financing to the assignee. Thus, mere credit assignment, if characterized by merely a change of the holders of the legal-obligational relationship, does not entail the incidence of SD.

4. On the taxation in SD of credit operations, Carlos Batista Lobo, "Financial operations in Stamp Duty: constitutional and tax framing", Review of Public Finance and Tax Law, I, 1, p. 86, writes: "The utilization of credit, both through the general route (item 17) and through credit titles (item 23) has a basis for legitimation that is considerably more dubious. In fact (…) the taxation of credit utilization seems to derive from the legislator's presupposition of a "virtual or apparent contributive capacity" resulting from the availability of liquidity for investment or expenditure. In this case (…) the subject benefiting from the credit operation benefits from an increase in financial liquidity at a present moment…".

5. And, further on, continues the author "Now, under these conditions the bases for legitimation of this type of tax are at the limit of constitutionality. In fact for taxation to exist it is necessary the existence of an economic reality at its base that sustains it (…) All these tax realities – income, consumption, property – have underlying them a materiality that sustains the tax presupposition (…) Now, the taxation of the utilization of credit is at the threshold of this grounding (…)."

6. The question of taxation of credit operations under SD – although of different nature from those analyzed here - was already the subject of arbitral decision. In Proceedings 107/2013-T, the following understanding is expressed:

"It is thus important to assess the verification in the particular case of the prerequisites typified in item 17.1.4. First of all, one must ascertain that we are faced with an effective utilization of credit, with the Claimant itself assuming that it concluded gratuitous loan agreements with its clients and effectively ceded funds to them in view of their [the clients'] financial shortages.

In fact, regardless of the purpose sought for the ceded funds, a utilization of credit occurred on the part of the Claimant's clients (when the effective mobilization of the funds, materialized by bank transfer or by check) based on a typical legal transaction of credit granting (loan agreement, under the terms provided for in articles 1142 and following of the Civil Code) which is not comparable to other types of situations that fall outside the scope of the rule and which consist of the mere temporal deferral of payment for goods or services provided by the respective supplier or service provider.

1. With effect, in the case under examination an effective transfer of funds occurred, not a mere granting of an extended period of payment on the part of the Claimant in its quality as service provider. Well beyond this, a financial expenditure on the part of the Claimant was verified which had to resort to its own funds and those of others (the bank) to meet the obligations assumed by it in the loan agreements concluded with the clients.

2. Moreover, it should be noted that item 17.1 encompasses the grant of credit, whatever the nature of the granting entity and the user.

3. Only insofar as it concerns interest and financial commissions does the General Table erect as a presupposition of incidence the carrying out by, or with intermediation of, credit institutions, financial companies and any other financial institutions. However, we are in that case in the domain of application of item 17.3 (interest and commissions) and not within the hypothesis under examination, which concerns item 17.1 (utilization of credit). In this, such restriction has no place nor the slightest correspondence in the letter of the law (which does not proceed to any distinction or restriction) and are encompassed, as highlighted above, any entities.

4. In support of this interpretation the Stamp Duty Code considers passive subjects of the tax, generically, the "entities granting credit" (cf. article 2, no. 1, subparagraph g) of said Code) without, again, introducing any distinction or restriction that can serve as a basis for the Claimant's thesis.

5. This position is supported by Circular no. 15, of 5 July 2000, of the Directorate of Services for Stamp Duty and Property Transfers (cf. points 14 and 23 of the Circular) and is, equally, supported by legal doctrine.

6. In this regard, one finds an illustrative excerpt from the work of J. SILVÉRIO MATEUS and L. CORVELO DE FREITAS:

7. Under the heading "financial operations", within the scope of stamp duty incidence are included the grant of credit, whatever the nature of the granting entity and user, together with a set of financial operations, from which result interest and commissions, which are only subject to taxation in stamp duty if carried out by credit institutions, financial companies, other entities legally equated to them and any other financial institutions.

8. Under no. 1, the grant of credit is subject to stamp duty, whatever the nature and form, being relevant, however, for such purpose the effective utilization of the granted credit and not the contract underlying it. A credit grant agreement can thus be concluded without such translating into a tax fact of this tax, which will occur whenever the utilization of credit is not immediate or there is no effective utilization of that agreement. (…)

9. It is emphasized, however, that the tax fact typified in this item is the grant of credit, that is, the utilization of credit based on a legal transaction of credit granting, whose essential elements translate into the provision of a present good against the promise of future restitution. Not all financing is thus encompassed by the incidence of the tax but only that which, bringing together the said characteristics, can be qualified as credit granting. Thus excluded from taxation is, for example, the so-called consumer credit, whenever the financing consists of mere temporal deferral of the payment of the acquired goods or services granted by the respective seller or service provider" – cf. from the cited authors "The Taxes on Real Property. Stamp Duty, Annotated and Commented", 1st Edition, 2005, Lisbon, Engifisco, pp. 732 and 733.

10. Also states JOSÉ MARIA FERNANDES PIRES:

"It is in the domain of financial operations, particularly credit, that the most relevant innovations of the new Stamp Duty Code in the reform carried out in 2000 took place. As we will see ahead, when we deal with the taxation of credit utilized through the opening credit agreement contract, the new Code introduces two fundamental innovations in relation to the previous one. On the one hand the tax now incides on credit utilizations and not on the conclusion of the contracts that give rise to them (…). On the other hand, the duration of the credit relationship now becomes determinant for the determination of the tax to be paid (…).

Credit operations are taxed under item no. 17.1 of the General Table. The law enumerates some contractual types of credit granting, such as the case of credit assignments, factoring, treasury operations, opening of credit in current account and bank overdraft.

However, this enumeration is merely exemplificatory, given that the law taxes the grant of credit independently of the contractual form underlying it ("grant of credit in any capacity", as determined by the said item of the General Table). As we have seen before, more than the form of the contract that underlies the credit relationship, what is subject to tax is the effective utilization of credit by the beneficiary." - cf. "Lessons on Property and Stamp Duty", 2nd Edition, 2013, Lisbon, Almedina, pp. 443 and 444 (emphasis ours).

1. The fact that the Claimant's clients to contract formation services resorted to community funds and, to receive the last tranche of those community funds, had to demonstrate that they had paid to their service providers (in this case the Claimant) does not alter the occurrence of an effective grant of credit by the Claimant, which transferred money to them under loan agreements, in order for them to meet their financial shortages.

2. It is reiterated that the Claimant was not limited to deferring the moment of payment for the services (training) provided until such time as its clients were in a position to satisfy that payment, which case would place us outside the field of incidence of Stamp Duty, as it would be simply a commercial relationship with a deferred payment regime.

3. In the situation analyzed the Claimant effectively delivered money, which it transferred from its bank account for them to use such amounts.

4. This lending of funds, even if for short periods of time, does not cease to configure an autonomous grant of credit separate from the commercial relationship with the clients, capable of filling the presuppositions of the tax event of taxation in Stamp Duty, which is not prejudiced by the fact that there is a connection with the activity of the Claimant and that of its clients. Moreover, this grant of credit is not, as the Claimant intends in the course of allegations, reducible to mere "accounting operation".

5. On an interpretative level, what to conclude, then, from all that has been evidenced on this point?

6. The essential trait, which derives from the law, runs through all legal doctrine, in a well-marked manner, and has already been reflected in arbitral decision, implies that the subjection to SD of credit operations must be based on the effective utilization of funds. That is, it is not the contracting of these operations, or their form of accounting, that must be decisive.

7. What should be inquired, rather, is whether such operations were concretized in the availability of liquid means and on which dates. That is, whether and when the use of financial means that provide the credit user with liquidity or additional financial availability was effectuated.

8. This is thus a fundamental analytical framework for the framing that follows of the issues under examination.

9. Before proceeding, however, and because it is a crucial question in these proceedings, it is necessary to clarify who is legally burdened with the burden of proof of the presuppositions of the rule in question.

10. In this regard, article 74, no. 1 of the GTC provides that:

"The burden of proof of the facts constitutive of the rights of the tax administration or taxpayers falls on the party invoking them."

1. Given that, in these proceedings, the Respondent seeks to assert the right to tax the financial operations in question, by considering them as credit grant operations, specifically taxed under Item 17.1.4..

2. The claimant, for its part, seeks to assert its right to annulment of the assessments due to incorrect qualification by the Respondent or because the right to assess SD has expired.

3. Wherefore, following the GTC rule transcribed above, the AT shall bear the burden of proof of the existence of a credit utilization operation taxable under stamp duty.

4. For its part, the Claimant shall bear the burden of proof of the presuppositions that the operations in question, even though of a financial nature, do not constitute credit granting operations for purposes of the SD Code or, in other cases, that the right to assess tax by the AT has expired, or still that an exemption from taxation applies, namely, because that is what is at issue in these proceedings and results from the rule of article 7, no. 1, h) and i) of the Stamp Duty Code.

5. This has been, moreover, the uniform understanding of the Court of Accounts' jurisprudence in analogous matters, which can be consulted, in this regard, the Judgment of 24-04-1991, delivered in case 013143, the Judgment of 14-01-2005, delivered in case 01480/03, as well as the Judgment of 29/04/2004, delivered in case 01680/03, in whose summary can be read:

"I - In the absence of special rules, the burden of proof of the verification of the legal presuppositions of its action rests with the Administration, especially the proof of the existence of the tax facts on which the additional assessment contested was based.

II - Thus being, having the Administration verified, through examination of the ledger, the existence of inaccuracies or omissions in the declaration of the objecting party, the additional assessment must be deemed well-founded, since the Administration only had to carry out the proof of the verification of the respective indications or presuppositions of taxation, that is, of the legal presuppositions of its action.

III - Having carried out an intra-community transaction that benefits from exemption, it was incumbent on the objecting party to prove the existence of the tax facts that it alleged as the basis for its right, that is, the existence of the alleged intra-community transmission."

1. Let us then see to what extent the provisions of article 74, no. 1 of the GTC were complied with.

A - Analysis and decision on the subjection to SD of "Contracting of loans from parent company"

1. The TIR - pages 3 and 4 - frames the total amount of € 9,235,516.00 as follows:

"It was only possible for us to verify that, of the €9,239,516.00, the amounts of €741,500 and €2,888,667.00 result from two contracts (annex 4), relating respectively, to the cession of credits for A that company E with the NIPC ... held in the amount of €741,500 over companies D sp Zoo and C, as well as the cession of position that B made to A for credits it held in company C.

1. In summary A became creditor of those companies without having directly made the loan of those amounts which were, indeed, spent by company F -Far East Ltd, having in return evidenced this amount as shareholder contributions made by the parent company.

2. The assignment of credits from E to A and the entry of these in the current account of parent company B, relates to the fact that E had been financed in previous economic periods, by the latter, to meet a need for liquidity for the grant of a loan to another company.

3. For its part company B, made, in 2008, two loans to company C in the total value of € 2,800,000.00 in order to provide it with the necessary resources so that it could make a financing to a company in which it held a stake. On 2009-03-01 the credit that B held in C is assigned to A in the total value of €2,888,667.00 without any payment having been made by A to the parent company, having made the accounting entry as shareholder contribution made by B.

4. This assignment of credits made by the two companies to A, allowed that at the same time as these transferred a right they possessed over a third party company, they also relieved themselves of an obligation to another third party (obligation to reimburse the loan made by B). This situation configures an assignment of credits burdened with the obligation to effect its repayment by A to B which in reality did not happen, having therefore evidenced accounting this obligation through the entry in the shareholder contributions account.

5. As mentioned, the taxpayer evidenced in the accounting all these operations as shareholder contributions".

6. Now, as can be seen from the content of the TIR, the operations with E and with B did not imply any effective utilization of funds or liquidity by the Claimant. In truth, such operations consisted in the assumption of active values (rights) which, as a rule, would imply a payment by the Claimant to the (related) entities that assigned credits to it.

7. Such payment not having been made, the claimant accounted for this consideration as Shareholder Contributions. That is, to the accounting entry of the assets that derived from the credits that were assigned to it, there corresponded in the Claimant an entry as liability, in a shareholder contributions account.

8. Now article 243, no. 1, of the Commercial Companies Code, defines shareholder contribution as:

"1 - A shareholder contribution agreement is considered to be the agreement by which the shareholder loans to the company money or other fungible thing, the latter being obligated to return another of the same gender and quality, or by which the shareholder agrees with the company the deferment of the maturity of its credits over it, provided that, in either case, the credit retains a character of permanence."

1. Thus, it does not result from this rule that the shareholder contribution agreement must necessarily have as its object the entry of liquidity (the reality that SD intends to tax) into the company that recognizes such shareholder contributions. The operation in question is proof of this: what the Claimant recognized were credit rights, and not an actual entry of funds.

2. For taxation to exist it was necessary that the accounting counterparts of the entry as shareholder contributions of the amount of € 9,235,516.00 had been analyzed by the AT and it was proven that such counterparts had implied the entry of financial availabilities, of liquidity, or of effective use of credit by the claimant.

3. The AT fails to prove this effective utilization of funds, limiting itself to saying that the amount is accounted for as shareholder contributions, from which it concludes, without more, that this is subsumible into the tax event provided for in item 17.1 of the SD Code.

4. It is certain that the AT alleges that it had at its disposal only additional information about the operations with E and B. And that the contracts attached with the IP will not be worth as proof.

5. But the AT also sustains in the reply (point 24.) that "it does not matter for the legal framework under discussion to conclude whether those financial operations constitute true shareholder contributions". Continuing, in point 25. of the reply, by alleging that "What matters, rather, is to conclude that the financial operations constitute true credit grants that involve a financing of the Claimant at the cost of third-party capital, which occurs when the moment is deferred in time when the Claimant is obligated to disburse a certain amount".

6. A thesis which contradicts the very position that the AT has expressed and publicized. The Information itself from the Ministry of Finance – DSISTP – no…, of 03.07.2002 clarifies that the assignment of credits does not, legally, configure a credit grant agreement, whereby it is only subject to taxation in SD if it involves some form of financing to the assignee, and possibly to the assignor, according to the conditions of the assignment.

7. It is not sufficient, for the taxation in SD of a credit assignment, the financial nature of the operation, being important that from the terms of the agreement results some form of financing to the assignee.

8. In the present case, not having negotiated the right of recourse of the acquirer (A) over the creditor (B) in case of non-performance by the debtor (E, C, D) it seems there is lacking one of the essential elements of the credit grant agreement, the obligation of restitution, whereby a possible financing does not qualify as an autonomous credit grant.

9. However, the fact is that, in the course of inspection, the AT could and should have analyzed the accounting counterparts of the entry of the amount evidenced as shareholder contributions and that is the point in question here. It did not do so and could have done so, as this would depend on the analysis of the accounting supports of the claimant.

10. Thus, not being proven in the proceedings that the entry as shareholder contributions corresponded to an effective utilization of funds, the SD assessment on the amounts here in question, in the amount of € 741,500.00 and € 2,888,667.00 should be considered as lacking legal basis and the 2009 SD assessment act no. 2013 ... on these amounts annulled.

11. As for the balance of € 1,600,000, it says the same concerns a transfer from B in favour of A made on 01/04/2009 with the objective of financing this company to pay the price of acquisition from C of the shares representing the entirety of the share capital of company D.

12. This acquisition of shares is evidenced by a document – agreement – which was only attached by the Claimant in the initial petition and not during the Tax Inspection.

13. For its part, the amount specifically loaned by B to the Claimant, designated by it as "shareholder loan agreement", in the amount of € 1,600,000 was only attached after the delivery of the initial petition, never being made available during the AT's inspection action, being a simple translation and not legalized and having the AT requested the removal of the same from the proceedings.

14. The shareholder loan agreement is executed on 31/03/2009 and the transfer of the amount from B to A is made on 01/04/2009.

15. The effective transfer of the amount is recognized by the Claimant (subparagraph p. of article 34 of the IP).

16. The shareholder loan agreement refers to a repayment period not exceeding 5 years, with that period appearing, apparently, to be indicative.

17. From the documentation and arguments presented the Claimant did not prove that the financing had a determined or determinable period.

18. The Claimant not having provided sufficient evidence about the conditions of realization, objectives, periods and repayment conditions.

19. The entirety of the amount is thus qualified as a grant of credit for an undetermined or indeterminable period, being classifiable under item 17.1.4 of the General Table of Stamp Duty (GTSD), which provides:

"17.1.4-Credit utilized in the form of current account, bank overdraft or any other form in which the period of utilization is not determined or determinable, on the monthly average obtained through the sum of the debt balances assessed daily, during the month, divided by 30".

1. Thus, the 2009 SD assessment act no. 2013 ... on the balance amounts is to be maintained, in the part that was not subject to the partial revocation by the dispatch above referred to of 17 February 2014 of the Finance Directorate of ....

2. The remaining part of the 2009 balance concerned a shareholder loan made by B to A dated 21/07/2009 which provides for the availability amounts to be delivered by A to C in 2009 and 2010 to meet financing or treasury needs of C.

3. This loan also gave rise to the assessment of SD by the AT, relating to the year 2010, assessment 2010 no. 2013 ..., which incided on two credit entries from B, made in the accounting of A in the year 2010, in the amount of € 1,000,000.00.

4. This shareholder loan agreement, from B to A, was only attached after the delivery of the initial petition, never being made available during the AT's inspection action, being a simple translation and not legalized and having the AT requested the removal of the same from the proceedings.

5. The agreement, in the draft made available by the Claimant to the tribunal, states that B grants to A a shareholder loan, for a limited amount of € 3,500,000.00, to be accounted for as shareholder funds and that the repayment period will never be later than 31/07/2011.

6. This repayment period was not complied with.

7. The agreement is signed on 21/07/2009.

8. The transfers were received by A from B in the following terms:

a. 1,100,000.00 on 27/07/2009

b. 1,200,000.00 on 28/08/2009

c. 200,000.00 on 28/12/2009

d. 660,000.00 on 04/03/2010

e. 340,000.00 on 24/05/2010

1. Under the terms of the SD Code, and as explained by the tribunal, reaffirming all cited in point 3 of number 51 of this judgment: Under no. 1, the grant of credit is subject to stamp duty, whatever the nature and form, being relevant, however, for such purpose the effective utilization of the granted credit and not the contract underlying it. A credit grant agreement can thus be concluded without such translating into a tax fact of this tax, which will occur whenever the utilization of credit is not immediate or there is no effective utilization of that agreement. (…)

2. From the documentation and arguments presented the Claimant did not succeed in proving that the financing, made in various tranches, had a determined or determinable period.

3. The Claimant not having provided sufficient evidence about the conditions of realization, objectives, periods and repayment conditions.

4. The entirety of the amount is thus qualified as a grant of credit for an undetermined or indeterminable period, being classifiable under item 17.1.4 of the General Table of Stamp Duty (GTSD), which provides:

5. "17.1.4-Credit utilized in the form of current account, bank overdraft or any other form in which the period of utilization is not determined or determinable, on the monthly average obtained through the sum of the debt balances assessed daily, during the month, divided by 30".

6. Thus, in this part, the 2009 SD assessment act no. 2013 ... on the balance amounts is to be maintained, in the part that was not yet subject to the partial revocation by the dispatch above referred to of 17 February 2014 of the Finance Directorate of ... as well as the 2010 SD assessment act, no. 2013 ....

7. Finally, one analyzes a transfer of the amount of € 520,000.00 made on 11/06/2010 by B in favour of the Claimant.

8. This transfer was made under a "Shareholder's Loan Agreement and Authorisation" concluded between B and the Claimant on 09/06/2010 and with a repayment period fixed for 31/08/2011.

9. This period was not complied with by the parties.

10. The Claimant did not make available a copy of that agreement whereby it is not possible to know the conditions, period and other details of that same availability of funds.

11. Whereby SD was assessed under Item 17.1.4 of the GTSD, as a current account operation for undetermined period, but possibly SD under Item 17.1.2 of the GTSD (grant of credit for a period of more than 1 year).

12. Thus, the 2010 SD assessment act no. 2013 ... on the balance amounts contemplated in this point in the amount of € 520,000.00 is to be maintained.

B - Analysis and decision on the subjection to SD of "Agreements with company C"

1. What is in question is a loan agreement through which the Claimant granted to C a loan denominated "short-term" in the maximum amount of € 3,500,000.00.

2. This agreement is concluded on 24/07/2009 with the possibility of repayment until 31/07/2011.

3. The loan was made available in tranches with the entirety of the amount of € 3,500,000.00 being entirely transferred to C until 31.12.2010.

4. It should first be noted that, on this point, the AT's position – in contrast to what it adopted regarding the operations referred to in A - is well expressed in points 47, 48 and 50 of the Reply, in which the effective utilization of credit, and not the date of its contracting, is erected as a presupposition of incidence by the AT.

5. In the IP, the Claimant alleges that the right to assess SD would have expired, as the tax fact would have arisen on the date of conclusion of the agreement and not at the moment of the effective availability of the financial funds that the Claimant loaned to C.

6. Now, it is shown in the TIR – which the Claimant does not contest - that the availability of the amount contracted as a loan from the Claimant to C was made in tranches. That is, the conclusion of the agreement took place at a certain moment, but the effective availability of funds is later.

7. Thus, and in view of the understanding already developed in this judgment, there is no doubt that SD is due by the effective utilization of funds - which here exists – and will have to be referred to at that moment and not to that of the mere contracting of such operation.

8. Now, analyzing the agreement, which was attached by the Claimant, it is verified that the same provides for a grant of credit for a period equal to or exceeding 1 year, therefore subsumible to item 17.1.2 of the GTSD, as assessed by the AT.

9. SD is thus due on the tranches made available under this agreement, during the year 2009 and 2010, with the exception of those whose right to assess SD has expired through article 45 of the GTC.

10. The tribunal notes that the AT assessed SD only on a total value of credit granted and utilized by C in the amount of € 3,160,000.00.

11. The taxation in SD, therefore, does not suffer from illegality, regarding the total amount, transferred in tranches, of € 3,160,000.00 which appears in the TIR. As the assessments relating to 28/7/2009 and 2/9/2009, whose expiry is petitioned by the Claimant, were already annulled by the AT, the remaining assessments for 2009 and 2010 above identified are maintained, in the part applicable here.

C - Analysis and decision on the subjection to SD of "Agreements with company F and G – ..., SA"

1. The operation in question is characterized by:

2. Having been approved on 31-3-2010, by the Claimant – as shown in document 9 attached to the TIR - the intention to acquire real property from F, and also from G.

3. Having been transferred, on 15-6-2010, to these two entities the total amount of € 520,000.00.

4. In 2013, and given the non-existence of real property purchase and sale agreements in the year in which the Claimant was inspected (2013), the AT considered such amounts as being, in substance, loans and assessed SD.

5. The Claimant alleges that the purpose of the fund transfers corresponds to an advance payment of the price of the real property, with there being no loan operation. In defense of this position, it is stated in point 80 of the IP: "The fact that these agreed contracts, with advance payment of the price in relation to the corresponding deeds, have not yet been formalized, and possibly we are faced with a failure in the formal perfection of such property transactions, does not convert A's respective credit rights into loan operations" (emphasis in the original).

6. Let us see, then.

7. The decision to be taken must be based on the elucidation of the following essential point: the factuality, and especially the means of proof that appear in the proceedings, allow us to subscribe to the Claimant's thesis according to which this is an advance of funds relating to the price to be paid for the real property, or, on the contrary, to the AT's thesis, according to which such transfers of funds constitute financings of the claimant to the two companies in question?

8. Now it is proven that:

• there is no conclusion of promise agreement or of the deed of the real property;

• between the date of the decision to acquire the real property (21-3-2010), the date of the effective transfer of funds (15-6-2010) and the year of inspection (2013) no operation existed to make the effective acquisition of the real property;

• As the AT alleges, and is not contested by the claimant, F, and also G – ..., SA, ceased their activity without making the said property acquisitions;

• This closure of activity was deliberated and approved in the same minute in which the alienation of the real property to A was deliberated;

• Throughout this period the funds transferred by the claimant (€ 520,000.00) were at the disposal of the two entities.

1. Thus, faced with such a scenario, the tribunal understands that the fund transfers configure, in substance, a financing of the Claimant to the two entities.

2. Otherwise, we would be led to consider the existence of a liberality from A to the two companies, which is not viable given that we are faced with commercial entities, with profit motives, even though all belonging to the same business group.

3. Moreover, if the Claimant's thesis were accepted, then the cession of funds, as a form of financing between companies, could escape SD, being sufficient for this that it be agreed that it was carried out under a hypothetical property acquisition, not contractualized or materialized, of an asset of the beneficiary companies, and that such cessions would form part of an advance payment. We judge such thesis to be too fragile, and even conducive to evasive behavior, to be taken into account as a basis for non-taxation in SD.

4. Thus and grounded in the principle of the prevalence of substance over form, we understand that a credit grant operation is configured.

5. The 2010 SD assessment under item 17.1.4, no. 2013 ... must be maintained, not suffering the same from illegality.

D - Analysis and decision on the subjection to SD of the Loan made to company D

1. According to the AT's report: "Analyzed the analytical trial balance of the company for the year 2010 and more specifically account 4113011 Financial Investments -Loans Granted -Group Companies -D , there is verified the existence of a debit balance of €1,193,130.00.

2. The balance presented at the end of 2010, is the result of two transfers in the amounts of € 704,925.00 and €2,095,205.00 (totaling €2,800,130.00) made in March 2009, with a first repayment of €907,000.00 occurring on 2009-05-20. On 2010-12-15 a new repayment was made in the amount €700,000.00, thus resulting in a balance still owed in the amount of €1,893,130.00.

3. No agreement was presented between the two parties that evidences this creditor balance in favor of A.

4. However, it results from the documents presented by the Claimant during the tax inspection a "Share Transfer Agreement" between C and A through which C transfers to the Claimant, on 24 March 2009, for a value of € 3,355,000.00 the entirety of the shares it holds in company D, which thus becomes held by A.

5. The Respondent acknowledges (point 65. of the reply) that D is a company domiciled in Poland held 100% by the Claimant.

6. The credit held by A over D, in 2010, thus corresponds to a shareholder credit.

7. Now, the exemption provided for in subparagraph h) or subparagraph i) of no. 1 of article 7 of the Stamp Duty Code is thus configured, which includes within the scope of objective exemptions the following: h) The operations, including respective interest, referred to in the preceding subparagraph, when carried out by holders of share capital to entities in which they hold directly a shareholding not less than 10% and provided that this has remained in their ownership for one consecutive year or since the constitution of the investee entity, provided that, in the latter case, the shareholding is maintained during that period;

i) Loans with characteristics of shareholder contributions, including respective interest made by shareholders to the company

1. Whereby in this point the tribunal understands that the 2009 SD assessment act no. 2013 … on the balance amounts must be annulled, in the part that was not yet subject to the partial revocation by the dispatch above referred to of 17 February 2014 of the Finance Directorate of ... as well as the 2010 SD assessment act, no. 2013 ... .

E - Analysis and decision on the subjection to SD of the Loan made to company C

1. In this operation, the Claimant alleges that the amount of € 354,081.00 (which includes € 340,000.00 of principal and the remainder in interest) would form part of the global amount of €3,500,000.00 made available by A to C and which was already analyzed (see above "B - Analysis and decision on the subjection to SD of "Agreements with company C").

2. Thus, the right to assessment would have expired, as, always according to the Claimant, the tax fact would have as reference the date of 24-7-2009.

3. Now, the AT considered, in that above-mentioned point B, the amount of € 3,160,000.00. Not contesting the Claimant the effective transfer of funds to C, what must be taken into account is not the date of the agreement – as was shown in this judgment – but rather the date of the utilization of the funds. Then, either it would be taxed within the scope of operation B (above) or, as the AT individualizes this portion, and there being grounds for its subjection to SD, it should be taxed autonomously.

4. The Claimant acknowledges (points 103. and 104. of the IP) that A was creditor in 2010 of € 354,081.00 in which was included a transfer to C made on 31/05/2010 in the amount of € 340,000.00.

5. The Claimant equally acknowledges that this transfer was nothing more than the transfer of the last tranche of the advance of € 3,500,000.00 made by A to C.

6. The tribunal analyzed this operation and the incidence of SD on the same in subparagraph B) above.

7. The Claimant's argumentation regarding the expiry of the right to assessment does not thus proceed. Thus, the 2010 assessment of no. 2013 .... is to be maintained.

IV. REQUEST FOR COMPENSATORY INTEREST

1. The Claimant paid the assessments contested, in the amount of € 57,380.68 relating to 2010 and € 37,168.57, relating to 2009, on 04/12/2013.

2. Together with the annulment of the assessments, and consequent reimbursement of the amounts unduly paid, the Claimant also requested that it be recognized the right to compensatory interest, under article 43 of the GTC.

3. With effect, under the terms of the rule of no. 1 of said article, compensatory interest shall be due "when it is determined, in amicable reclamation or judicial challenge, that there was an error attributable to the services from which resulted payment of the tax debt in an amount superior to that legally due."

4. Beyond the means referred to in the rule which transcribed, we understand that, as follows from no. 5 of article 24 of the RTA, the right to the mentioned interest can be recognized in the arbitral proceeding and, thus, the request is decided upon.

5. The right to compensatory interest to which the above mentioned GTC rule alludes presupposes that tax has been paid in an amount superior to that due and that such derives from error, of fact or law, attributable to the AT services.

6. In the case at issue it occurs that the stamp duty assessment 2009 -2009 Stamp Duty Assessment no. 2013 … – was partially revoked by the amount of € 19,829.91 by Dispatch of 26/07/2013 of the Finance Director of ..., on the grounds of expiry of the right to assessment, with the remainder of the assessment being maintained in the amount of € 17,338.66.

7. Moreover, the tribunal concludes by the partial acceptance of the Claimant's request and that, therefore, in relation to the 2009 Stamp Duty Assessment no. 2013 ... and the 2010 Stamp Duty Assessment no. 2013 ... which were maintained by the AT, there shall be a right to compensatory interest by reference to the SD which was paid by the Claimant based on assessment acts that the tribunal considers to be contrary to law and affected by error regarding the presuppositions of fact or law attributable to the AT, in accordance with the decision that flows from these proceedings.