The rule of law in the light of international law versus the principle of democracy

Since 2014, the #Federal Constitutional Court (case no. 2 BvL 21/14) has had a case pending before it on the basis of a suspension and referral decision by the #Federal Fiscal Court (#BFH) dated 20.8.2014 (case no. I R 86/13), proceedings have been underway since 2014 to examine whether a so-called #treaty #override within the meaning of Section 50d (9) sentence 1 no. 2 #EStG 2002/2007/2009 and pursuant to Section 52 (59a) sentence 9 in conjunction with Section 50d (9) sentence 3 EStG 2009 is unconstitutional. In view of the decision of the #BVerfG from 2015 (BVerfG of 15.12.2015, 2 BvL 1/12) on the constitutionality of a #Treaty_Override pursuant to Section 50d (8) EStG 2003, this is “old hat” and has long since been decided in favor of constitutional admissibility – one might think.

Apparently, however, the Second #Senate of the Federal Constitutional Court now seems to want to take up this referral procedure after almost eight years of “lying in wait”. The fact that the then judge of the Second Senate of the Federal Constitutional Court, Prof. Dr. König, as a proven expert in international law, issued a dissenting vote to the decision of 15.12.2015 and thus to the opinion of the majority of the Senate, gives reason for a renewed in-depth legal examination of this issue, which is only superficially tax law, but in fact purely constitutional and international law (#Grundgesetz) “on the hanger of #tax law”. Since the Second Senate has now been appointed to decide under the chairmanship of Prof. Dr. König, who is also Vice President of the Federal Constitutional Court, there is reason to assume that the Federal Constitutional Court will no longer adhere to its case law on treaty override, which is worthy of discussion under constitutional and international law, and will take new paths that are not only in line with the German constitution and the Union legal order, but also with the self-image of a modern state in the structure of the community of states.

Our partner Prof. Dr. Dr. Karsten Fehn, as a member of the #Constitutional Law Committee of the #Bundesrechtsanwaltskammer (Federal Bar Association), has submitted a #dissenting #vote on this topic as rapporteur for these proceedings in the context of a statement requested by the Federal Constitutional Court in accordance with § 27a BVerfGG on an earlier, contrary statement by the Constitutional Law Committee of the #BRAK. As a result, lawyer and tax advisor Dr. Dr. Bernd Josef Fehn and lawyer Prof. Dr. Dr. Karsten Fehn have published an article entitled.

Treaty override – time for a #paradigm shift

#Rule of law principle in the light of #friendliness to international law versus #democratic principle

in issue 5/2022 of the journal “#Die_Steuerberatung” (p. 161 to p. 200).

In this study, we come to the following conclusion:

1.) Section 50d (9) sentence 1 no. 2 EStG 2002/2007/2009 is unconstitutional and contrary to EU law. Due to the jurisdiction of the ECJ as the statutory judge, the proceedings before the Federal Constitutional Court must be suspended and referred to the #EuGH if and to the extent that the Federal Constitutional Court does not find the provision to be unconstitutional, departing from its previous case law.

2) Section 52 (59a) sentence 9 in conjunction with Section 50d (9) sentence 3 EStG 2009/2013 is unconstitutional and must therefore be rejected by the Federal Constitutional Court because there is a violation of the rule of law in the form of an impermissible genuine #retroactive effect.

3) In the event of a referral to the ECJ, this means that the EU’s principle of the rule of law must also be criticized as being violated.

4) In any case, from the perspective of German constitutional law, we must wait with bated breath to see whether the Federal Constitutional Court turns away from its previous case law.

The time for this is overdue.