CJEU Holds Restriction on Free Movement of Capital for Investment Funds May Be Neutralized by Tax Treaty if Certain Tax Credit Conditions Met

The Court of Justice of the European Union (CJEU) issued a judgment on 17 September 2026 concerning whether a restriction on the free movement of capital arising from differing tax treatment of an investment fund may be neutralized by an applicable tax treaty. The case involved Ishares Europe ETF, a United States-based collective investment undertaking that received dividends from shares it held in Spanish companies between the tax years 2007 and 2010. While Spanish domestic investment funds…