French Supreme Administrative Court Rules on Arm's Length Adjustments for Interest-Free Loans

The French Supreme Administrative Court (Conseil d'Etat) issued a decision on 20 December 2024 concerning arm's length adjustments for interest-free loans from a parent company to its subsidiaries. The case involved a French company, Fibusa, which provided interest-free loans to its Romanian subsidiaries in the year 2011 to 2014. Following an audit, the tax authorities determined that this was an indirect transfer of profits. Considering this, the tax authorities determined the interest inco…