The National Court refuses to suspend the temporary tax of the Ministry of Finance to energy companies and banks

This is how it responds to Repsol's request for precautionary suspension

The National Court has rejected this Friday the precautionary suspension of the order of the Ministry of Finance that develops the law that includes temporary taxes for energy companies and banks.

The Seventh Section of the Contentious-Administrative Chamber has resolved in an order the first request for precautionary measures requested in Repsol's appeal against models 795 and 796 (of the tax on energy companies) and models 797 and 798 (of the tax to banks) on the advance payment of the temporary liens established by the aforementioned law.

The Court considers that rejecting the suspension does not imply irreparable damage to the energy company, since if the appeal is finally upheld, it would be a situation that is perfectly reversible through the return of the amount paid with the payment of the mandatory interest.

Thus, it indicates that in this case "the damages derived from the non-suspension will only mean submitting to the obligation to make the declaration in the manner provided by the Ministerial Order".

And it adds that "obviously it is a perfectly reversible situation and reparable damages in the event that the claims sustained in the lawsuit that must be formulated by the appellant company are upheld."

"SERIOUS DAMAGE TO THE GENERAL INTEREST"

What's more, the Chamber says that, quite to the contrary, if the Order and with it the Law were suspended, it would cause "serious damage to the general interest by making it impossible to collect the tax."

It points out that if it were to accept the precautionary measure in question, it would leave unfulfilled "one of the requirements of the Law, which in its explanatory statement says that it has a primary collection purpose, in order to demand, in these times of energy crisis and inflation, a greater effort to those who have a greater economic capacity, that is, a show of solidarity from the great fortunes".

Thus, the court considers that the precautionary measure that Repsol is interested in would mean "the petrification of the legal system", since, by obtaining the precautionary measure with respect to the Development Ministerial Order, "the application of a law would be paralyzed which has a detailed justification in its statement of reasons and with respect to which this Chamber has nothing to say because it totally lacks competence to annul regulations with the force of law".

On the other hand, it warns that, although Repsol points out that in no case does it seek the suspension via precautionary justice of the law, "the reality is that such an effect would be inseparably linked to the adoption of the requested precautionary measure."

INFLATION AND THE UKRAINE WAR

Likewise, the Chamber stresses that the reasons for the implementation of this temporary tax, included in the law itself, refer to the increase in inflation, the influence of the Ukrainian War, the supply problems derived from the pandemic, or the insufficient increase in wages.

And it insists that the court should not assess these arguments because the courts cannot "determine the way in which the precepts of a general provision should be drafted to replace those that they annul, nor will they be able to determine the discretionary content of the annulled acts" .

The National Court also includes in its order that on February 10 it already rejected Repsol's initial claim to suspend the Ministerial Order by adopting very precautionary measures, that is, without requesting a report from the Administration.