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Maciej Bernatt, Alexandr Svetlicinii
World Competition
Volume 41, Issue 3 (2018) pp. 309 – 334
https://doi.org/10.54648/woco2018019
Abstract
The article compares the application of the right of defence in competition law proceedings by seven National Competition Authorities (NCAs) of Central and Eastern Europe (CEE). In particular, the article focuses on four sub-rights that are part of the right of defence: right to be informed; right to access the file; privilege against self-incrimination (PASI) and legal professional privilege (LPP). The article shows that the NCAs selected as case studies generally provide lower procedural guarantees in comparison to DG Competition of the European Commission. The findings of the article are relevant in view of the Directive aiming at harmonizing the powers of NCAs (‘ECN Directive’). The legislation aims at strengthening the investigatory tools of NCAs, while it pays limited attention to the procedural guarantees followed by NCAs. In view of the diverging application of the right of defence by the NCAs selected as case studies, the article challenges such policy choice, claiming that stronger investigative powers should be counterbalanced by a more homogenous application of the right of defence by NCAs of the EU Member States.
Extract
This article analyses the tax attractiveness of locations for investments in digital business models. It identifies and assesses relevant tax rules affecting domestic and cross-border digital business models across thirty-three countries. The computation of average effective tax rates is based on the neoclassical investment model of Devereux/Griffith. Our results help to evaluate tax-related location factors in the digital economy by combining the most relevant tax parameters and rules for taxable nexus in an objective measure. We find that investments in digital business models face generally lower average effective tax rates than those in traditional business models since a high share of investment costs is immediately expensed and a higher share of activities falls within the scope of countries’ tax incentives for R&D input and/or output. While more generous depreciation rules for digital investments such as software make countries relatively more attractive, our results are mostly driven by statutory tax rates, special incentive schemes such as Intellectual Property (IP) Boxes, R&D credits, and super-deductions. Overall, we acknowledge an increasing trend in tax competition for digital businesses.
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