First of all, I would like to thank the Association of European Administrative Judges and the Academy of European Law for the invitation to this conference. It is a great honour and challenge for me to speak to such a distinguished audience.
Being an administrative judge in the small State of Bremen, my daily routine work consists of a wide variety of cases. Their subjects range from social assistance or asylum law to value added tax. The number of cases, in which questions of community law are raised, is constantly increasing. Therefore, a conference dealing with the application of European taxation law by national administrative judges, is a valuable chance to learn and to exchange views with colleagues.
I cannot present the latest European taxation law news from Brussels or Luxembourg. This will probably be done later by other speakers who are able to do this. Rather, I want to give an introduction to our subject from the point of view of an administrative judge.
Firstly, I want to show in which way European taxation law becomes relevant in the daily work of an administrative judge at a court of first instance.

Secondly, I shall present the options for the solution of conflicts between national taxation law and community law. 
Thirdly, I want to throw a glance on the practice of administrative courts to request the European Court of Justice to give preliminary rulings concerning the interpretation of community law.
Finally, I would like to discuss some obstacles to the daily work of judges with community law.

1. European Taxation Law?

What is the task of administrative judges in the field of tax litigation? Administrative courts have to grant legal protection against specific illegal actions of the tax administration. To perform this task, administrative judges have to apply legal norms. 
However, rules of "European taxation law” are rarely applied as a standard for decisions in taxation cases. Usually, disputes are decided according to the standards of the respective national tax law. 
"European taxation law" forms the subject of this conference. That is also the title of comprehensive books written by distinguished experts on this subject. [1]. Nevertheless, "European taxation law" as a closed system of directly applicable law that does not exist yet. We find a variety of self-contained legal systems in the Member States. [2] These systems are complemented by a system of coordinates of community tax law. [3] 
The area of customs disputes might be considered as an exception. This requires that customs are considered as tax. Only for customs the community law is contained in regulations. [4]
With the exception of customs disputes, the legal relationship between the parties of a tax litigation is determined, first of all, by national law. The judge applies, for example, the national law on income tax and not community law. The parties of a dispute are not arguing over the Council Directive on the common system of value added tax, but about the content of the respective provisions of the national law on turnover tax.
In which way becomes "European taxation law" relevant for a judge? Why do articles in tax reviews discuss the basic freedoms under the EC-Treaty? Why are national tax administrations concerned about the decisions of the ECJ? Why do they view the jurisprudence of the ECJ as a risk to national budgets? 
European Taxation Law forms a meta-standard, that queries the absolute force of national law. It compels a national judge to ask to which extent national tax law can be applied to a case.

Directives

European taxation law is relatively easy to identify, if it is codified in directives. Such directives have been adopted to a greater extent for indirect taxes than for the direct taxes.

Indirect taxes

The Council adopts, according to Art. 93 of the EC-Treaty, provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market.
In 1967 the 1st Value Added Tax Directive required a common value added tax system. [5] An alignment of the value added tax was made by the 6th Value Added Tax Directive. [6] Since January 2007 the Council Directive on the common system of value added tax is the relevant legal instrument. [7] With the exception of tax rates, the member states’ systems of value added tax now follow a largely uniform design.
The excise taxes for tobacco products, alcoholic beverages and petroleum products were also harmonized. In particular, the system directive has to be mentioned. [8]

Direct Taxes

The main direct taxes are tax on personal income and corporate tax. [9]. In contrast to indirect taxes, the Treaty does not provide a specific legal basis for the harmonisation of direct taxes. Only the general provision of Article 94 of the EC Treaty can be used. The principle of subsidiarity prevents a comprehensive harmonisation in the field of direct taxation. The dedicated harmonisation concepts from the ’60s and ’70s could not be realized. The Commission has restricted itself, since 1990, to measures, that are indispensable for the free movement within the internal market. Therefore, we shall probably have to live with significant differences in the area of corporate tax for many years.
Nevertheless, since 1990, a number of directives have been adopted, which are aimed to facilitate cross-border activities.
The Mother-Daughter Directive [10] unifies the taxation of groups of companies. Its aim is to eliminate the multiple tax burden for the distribution of dividends by a subsidiary to its parent company in another member state.
The Merger Directive [11] eases restructuring operations. It reduces tax obstacles to cross-border mergers.
The Interest and Royalties Directive [12] has the aim to reduce fiscal obstacles in connection with cross-border payments of interest and royalties within groups of companies.
The Interest Directive [13] has the aim to improve the effective taxation of interest income and to prevent a harmful tax competition between member states.

How do directives influence the work of the judge? 

They reduce the importance of national law. This is not only true for cases with cross-border implications. It can also be said about purely national cases without any cross-border aspects. Often it is not sufficient to have a look into the national tax law. Provisions of directives need to be considered. It cannot be taken for granted that the national implementation legislation corresponds to the respective directive. Sometimes the implementation of directives by the national legislature is delayed. The reluctance of the national legislature against a certain directive may also discourage the correct transposition into national law. In cases as such conflicts of standards exist. They have to be solved by judges. For the decision of cases, the applicable standards need to be identified.

Case Law of the ECJ

As far as directives have been adopted, at least the finding of the relevant community law does not impose major difficulties. As written law directives can be found, read and interpreted. But the Community harmonizes the member states’ tax law not only by the means of directives. The unanimity that is required by Art. 93 and 94 EC-Treaty poses an effective limitation to this approach.
As a result, in recent years harmonisation by the case law of the ECJ has become more and more important. [14] The Court reviews national tax rules to their compatibility with fundamental freedoms and discrimination prohibitions of the EC Treaty. In this respect the freedom of establishment (Article 43, 48 EC), the free movement of capital (Article 56 EC) [15], the free movement of workers (Article 39 EC) and the free movement of Union citizens (Article 18 EC) have become relevant. Virtually all types of tax have been reviewed by the ECJ. [16]
The harmonisation by the ECJ is currently the most important instrument of the harmonisation of tax laws to reduce internal market barriers. National judges are thus confronted with an ever-increasing body of case law of the ECJ. Since 1985 more than 100 decisions of the ECJ to tax questions were counted. [17] But which general rules can be deduced from these decisions? [18]
The harmonisation of national tax legislation by the ECJ is a relatively new phenomenon. Only in 1985, the Court began to deal with direct taxes. [19] In 1986 he began to review national tax legislation in the light of the basic freedoms of the EC-Treaty. [20]
Of great importance was the Schumacker-judgement in 1995. [21] The Court found that the freedom of free movement of workers obliges Member States to treat nationals of other member states with a family residence in another member state (non-residents), whose income results entirely or almost entirely from paid work in that member state, equally with residents. 
In other decisions, the Court reaffirmed that although direct taxation falls within their competence, member states must none the less exercise that competence consistently with community law. [22]
The ECJ gives the freedom of capital movement preference to the member states’ budgets. This was made clear by the Meilicke judgement in March 2007. [23] 
The approach of harmonisation of national tax legislation by directives is limited by the requirement of unanimity. The case law approach with the help of the fundamental freedoms of the EC treaty has also limitations. In principle, the application of a fundamental freedom requires a cross-border situation. Only then, if the scope of fundamental freedoms is opened, a taxpayer may argue that a provision of a national tax law is in conflict with the EC Treaty. This requirement reduces the practical significance of the above mentioned case law for the courts’ daily work considerably. Typical tax disputes are still purely domestic situations. The growing economic interdependence between the member states, however, ensures that the number of cross-border issues and thereby the importance of the ECJ’s case law for the courts’ work will increase.

2. Solution of the conflict between national law and community law

Indirect effect

If the application of a provision of a national tax law and a directive do not lead to the same result, national courts must do everything possible to interpret national law to comply with the directive. This means they must, as far as possible, interpret national law in the light of the wording and purpose of a directive in order to achieve the result intended.
The judge has to consider two legal standards from two different legal systems: the tax law from his national legal system and the directive from community law. Even more complicated becomes the situation by the fact that two different courts have the final decision concerning the interpretation of these standards. To take the example of Germany, the Federal Fiscal Court (Bundesfinanzhof) decides on the interpretation of German national tax law, the European Court of Justice has the final word concerning the interpretation of directives. For the national judge, this situation is anything but comfortable.

Vertical direct effect

Provisions of a directive which are clear, precise and unconditional can be directly invoked before national courts when the member state has failed to transpose the directive on time, or has transposed it incorrectly. Such provisions are defined as having "vertical direct effect". In this case the directive enjoys application precedence over national law. The judge has to decide whether a provision of national law shall not be observed. This is a difficult decision for a judge whose normal job is to find and to apply national law.

Preliminary Ruling Proceedings

In which way conflicts between national law and community law are to be resolved?
The ECJ is not a court of last instance for the national courts. The last word in tax litigation is not spoken in Luxembourg. National courts may request a preliminary ruling of the ECJ on questions of the interpretation of community law. According to article 234(3) EC Treaty, a court is under the obligation to refer where a question relating to the interpretation or validity of community law is raised in a case pending before a court or tribunal of a member-state against whose decisions there is no judicial remedy. The aim of the preliminary rulings procedure is to ensure that community law remains a common law. [24]
If a court tends to leave aside a provision of the national tax legislation, because the judges believe that it is contrary to community law, it will request a preliminary ruling of the ECJ regarding the interpretation issue. [25]
A list of all proceedings in the field of direct taxation pending before the ECJ can be found in the Internet. [26] The proceedings before national courts are suspended to wait for the decision of the ECJ on the interpretation issue. The preliminary rulings procedure takes an average of two years. Once the ECJ has decided, the national court proceedings can continue.
Thus we come to the third engine of harmonisation of member states’ tax law. It consists of the national courts. Their activities are undispensable. With the exception of infringement procedures started by the Commission against member states under Article 226 of the EC Treaty, the ECJ can only help the harmonisation upon a request by a national court. Therefore, not only member states and community institutions have the responsibility for the development of European taxation law. Rather, it lies in the national courts to forward the "harmonisation from below". [27] This responsibility is exercised by the courts as the emerging number of preliminary proceedings in tax matters before the ECJ demonstrates.

3. Practice of courts in requesting preliminary rulings

The number of requests to the ECJ for a preliminary ruling is constantly increasing. Thus, only one senate of the German Federal Finance Court made within a few years 20 requests to the ECJ. [28]
The Finance Court of Bremen, at which I am working, has requested preliminary rulings from the ECJ in a number of issues, especially in the field of customs law. The last request, however, dates back to June 1999. Subject of the proceedings was the refund of import duties paid for the import of Jack Daniels whiskey from the USA. [29] Other requests related to procedural problems of customs law. Another example is the charging of dried walnut pieces imported from a third country. [30]
Although the reading of legal journals sometimes may suggest, that the drafting of requests for preliminary rulings by the ECJ has become daily routine in tax litigation, such requests are quite rare for most colleagues. The reasons are manifold: 
Not every tax dispute concerns legal issues, frequently factual issues are at stake. As has been mentioned before, typical tax disputes are still purely domestic situations. 
If in court proceedings a question of interpretation of community law is raised, it can often be observed that the matter has already been clarified by the ECJ. And if the ECJ has not yet made a decision to the question, it is highly probable that another court has requested a preliminary ruling by the ECJ. The respective national court against whose decisions there is no judicial remedy may have to decide a similar legal question, which may require a request to the ECJ. It may also happen, that the alleged problem of interpretation does not exist, because the correct interpretation of community law is obvious (acte-clair theory).
Unlike publications such as the annual "checklist of norms of the German direct tax law that are potentially illegal in terms of community law" [31] perhaps sometimes suggest, most directives are properly transposed into national law and member states consider the consequences of the judgements of the European Court of Justice. By far the greater part of national tax laws is in conformity with community law.
One should also note that issues of community law are not only raised in judicial proceedings. Taxpayers and their advisers, as well as the tax administration monitor the development of community law. Both sides are interested to prevent unnecessary tax litigation. This approach can be supported by the law of administrative procedures. As an example, I would like to mention the respective provisions of German law.

Provisional tax assessment

Taxpayers argue with ongoing proceedings before the ECJ in their discussions with the tax administration. The tax administration may assess the tax provisionally, if the conformity of German tax law with community law is subject of a legal procedure in the European Court of Justice (Section 165 paragraph 1 sentence 2 Abgabenordnung). Following the decision of the ECJ, the tax assessment can be corrected, if this should prove necessary.

Suspension of the administrative appeal procedure

An administrative control procedure can be a prerequisite of court proceedings. In Germany, this is the administrative appeal procedure. If the tax has not already been fixed provisionally, the administrative appeal procedure can be suspended under section 363, paragraph 2, sentence 2 Abgabenordnung (Tax Code). For such a suspension it is necessary that the objection is based on a question of law, that is subject of a proceeding pending before the European Court of Justice.

Suspension of judicial proceedings

Not only the tax administration but also the financial court can wait with a decision until the ECJ has made a decision in a preliminary ruling procedure. 
The court may, if the parties agree, order the suspension of the proceedings (Section 155 Finanzgerichtsordnung -Finance Court Rules- conjunction with section 255 Zivilprozessordnung -Code of Civil Procedure-). If the parties do not agree, the court can suspend the proceedings against the will of the parties in accordance with § 74 Finanzgerichtsordnung.

Proceedings for interim relief

If a question concerning the conformity of a provision of national tax law with community law is raised in proceedings for interim relief, no request for a preliminary ruling is submitted to the ECJ.
According to German procedural law the levying of an appeal or a plea does not suspend the obligation of the taxpayer to pay the tax fixed by a tax assessment (Section 361, paragraph 1, sentence 1 AO, § 69, paragraph 1, sentence 1 Finanzgerichtsordnung). A later decision that the tax assessment was not in accordance with the law would lead to a refund. 
The courts can, however, grant interim relief. If a court has serious doubts about the legality of a tax assessment, it can suspend the tax assessment (Section 69 paragraph 4 Finanzgerichtsordnung). Such serious doubts about the legality of a tax assessment may be based on the fact that the respective provision of national tax law is, in the view of the court, not in conformity with community law. 
Can the court now suspend the application of the rule of national tax law? Or is it necessary to request the ECJ for a preliminary ruling? 
If courts doubt the validity of community law in an emergency procedure, they are obliged to submit a request for a preliminary ruling to the ECJ. [32] But they can nevertheless make a preliminary decision. [33] In tax litigation the typical question is not one of the validity of community law but of conformity of national law with community law. If a court has doubts with respect to the compatibility of a national tax standard with community law, there is no obligation to request the ECJ for a preliminary ruling. [34] Because of the preliminary nature of the procedure a submission of a request to the ECJ is not necessary. In practice, German financial courts do not submit requests for a preliminary ruling to the ECJ in procedures of preliminary legal protection. [35]
As an example, the Finance Court of Bremen has just suspended an income tax assessment because the judges had doubts whether the failure to deduct losses from the rental of land in Austria in the way of negative progressive taxation under section 2a, paragraph 1, sentence 1 No. 6 letter a Einkommensteuergesetz (income tax law) was in accordance with the freedom of capital movement (Article 56 of the EC Treaty). [36]

The influence of the parties on the practice of courts in requesting preliminary rulings

Judges endeavour to follow the rules "jura novit curia” and “da mihi factum, dabo tibi jus". Nevertheless, the legal issues, that are raised in a particular case, depend to a large extend on the initiative of the parties.
If taxpayers are represented by lawyers who closely follow the jurisprudence of the ECJ, arguments of community law will be raised more frequently. [37] Also the submission of a request to the ECJ for a preliminary ruling may be suggested by qualified lawyers.
On the other hand, if the representatives of the financial administration are aware of a problem of community law, they will usually use all procedural means to avoid that such cases reach the court room before the legal issues are resolved by the ECJ.
Parties of a tax litigation cannot prevent the court from suspending the proceedings and requesting the ECJ for a preliminary ruling. The tax administration in Bremen had to learn this once, when it appealed against a decision of the Financial Court of Bremen. [38] In that case it was disputed whether a provision of the Steuerberatungsgesetz (law for professional tax advisers) indirectly discriminated women. The Federal Finance Court used the opportunity to reaffirm its jurisprudence that there is no appeal against decisions to request the ECJ for a preliminary ruling. [39] The admissibility of such requests is decided by the ECJ in its own jurisdiction.

4. Obstacles to find the European Taxation Law

National tax law is the usual working tool of a national administrative judge. If he wants to find information about a specific legal question, many means are available. He can find books, commentaries and journals in the court library. The search in national legal databases leads to current decisions not only of the supreme court in tax matters. Also, the decisions of national colleagues are available. These decisions are very helpful for the judge, as it often takes years to bring new issues before the highest courts. 
When a judge wants to find information about a question of community law, the situation looks different. There is no problem of access to European legislation. Also, decisions of the ECJ are easily accessible. To some extent the already mentioned books, comments and journals in the court library inform about community law - but only from a national perspective. By reading these publications, nothing can be learned about the evaluation of ECJ decisions in other member states. This deficit is not only due to language barriers. There are hardly any European journals and databases available for ordinary administrative judges. So far, the development is actually still in its infancy:
First steps to transnational databases are the DEC.NAT database and the database JURIFAST of the Association of the Councils of State and Supreme Administrative Jurisdictions of the European Union i.n.pa. [40]
DEC.NAT stands for National Decisions. The database contains 19.200 references to national decisions since 1959. It was last updated in June 2007. For decisions from the period before 24 May 2006, information in French and English is provided. A direct access to the texts of the decisions it is not granted.
The database JURIFAST lists decisions of the members of the Association of the Councils of State and Supreme Administrative Jurisdictions of the European Union. It was set up in February 2004. On 31 December 2007 there were 360 decisions in the system.
The decisions of the supreme courts of the member states can be accessed since April 2007 by the portal of the Network of the Presidents of the Supreme Judicial Court of the European Union. [41] The network has set up a meta-search engine that allows simultaneous searches in all decision-databases in the member states of the European Union that are accessible by the internet. The portal is still at the stage of development.

Besides these databases there are some tax law journals with an approach not limited to national legal questions. But journals like the EC Tax Review [42] will only seldom be found in court libraries.
National courts, with only limited means for a view across national borders, have to decide cases, in which taxpayers are assisted by law firms and consultants that have a clear orientation not only towards the European level, but also to the international level. [43] Also in the academic field, a European approach has become routine. [44] By contrast, courts still work in principle with a national approach. This is not only true with respect to lower courts. If one studies decisions of supreme administrative courts with a view to community law, one will rarely find evidence suggesting that judicial decisions or literature from other member states have been taken into account.
The development of community law to a common law cannot be left to the ECJ, universities and consulting firms. The courts in Europe must be networked better. Such networking would not only support the development of community law, but could also facilitate the daily work of judges. If a judge is confronted by a question of community law, that seems to be absolutely new, information how this question has been dealt with by judges in other member states could be extremely helpful.
In the national context, it is a matter of course, to take into account decisions of other courts, irrespective the place of the court. If a German administrative judge in Bavaria has to decide a taxation case in which the parties argue about the assessment of the private use of a company car, he can not only consult Bavarian literature and jurisprudence and the jurisdiction of the Federal Finance Court. He can find out how such cases are assessed outside Bavaria by means of books, journals and databases. If he wants to, he can learn from the decisions of colleagues in Berlin or Hamburg. 
Despite the fact that the European Union is reality since many years, the judicial perception of legal opinions mostly still ends at the member states’ border. A German judge will only learn something about his Dutch colleague’s approach to community law by reading an ECJ-judgement that decides the request of a Dutch court for a preliminary ruling. 
For the improvement of the judicial work in the field of European taxation law, access of courts to the latest decisions of other member states’ courts must be facilitated. Also, the discussion of community law in other member states should be accessible not only to scholars and major consulting and law firms but also to national judges. The development of appropriate databases is decisive in my opinion. These need to be equipped with translation tools. Perhaps, one day, the above mentioned Bavarian judge can read and quote a Slovenian court decision as he does today with respect to judgements of his colleagues from Berlin.