Liability of Management Board Members of Capital Companies in the Light of the Judgement of the CJEU of 27 February 2025 in Case C-277/24, Adjak
Liability of Management Board Members of Capital Companies in the Light of the Judgement of the CJEU of 27 February 2025 in Case C-277/24, Adjak

Summary/Abstract: The subject matter presented in this article focuses on the interpretation of the EU law, in particular of Article 273 of the VAT Directive, which is covered by the judgement of 27 February 2025 delivered by the CJEU in case C-277/24, Adjak, in response to a question referred for preliminary ruling to the CJEU by the RAC in Wrocław. From the point of view of the principles governing liability of management board members for tax arrears of companies, this judgement can be considered a breakthrough. This is an extremely important issue for the tax practice both at a national and European level. Despite the fact that the judgement in the Adjak case is favourable for third parties, especially management board members of capital companies, the solutions it adopts raise significant doubts from the perspective of the principle of legal certainty, in particular in the context of the stability and finality of tax decisions. This judgement also poses a risk of procedural complexities arising from management board members questioning factual findings or legal classifications adopted in the tax assessment proceedings to which the taxpayer is subjected. The judgement in the Adjak case should be an incentive to amend urgently the applicable substantive and procedural regulations concerning the joint and several liability of third parties. This is because the judgement itself neither removes numerous controversies and incorrect practices derived from Article 116 of the Tax Ordinance, nor puts the discrepancies in the existing case law in order. It is merely the first serious attempt to shed light on an unclear regulation of joint and several liability of management board members for tax arrears of capital companies, which infringes the rights of an individual.

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