BFH - IX R 6/23
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| BFH - IX R 6/23 | |
|---|---|
 | |
| Court: | BFH (Germany) |
| Jurisdiction: | Germany |
| Relevant Law: | Article 4(1) GDPR Article 4(2) GDPR Article 6(1)(c) GDPR Article 6(1)(e) GDPR § 29b AO § 97(1) AO |
| Decided: | 13.08.2024 |
| Published: | |
| Parties: | |
| National Case Number/Name: | IX R 6/23 |
| European Case Law Identifier: | ECLI:DE:BFH:2024:U.130824.IXR6.23.0 |
| Appeal from: | Financial Court Nuremberg 3 K 596/22 |
| Appeal to: | Not appealed |
| Original Language(s): | German |
| Original Source: | Bundesfinanzhof (in German) |
| Initial Contributor: | Lacrosse |
The German Federal Financial Court held that the tax office request of rental agreements is proportionate and the subsequent processing of the tenants personal data is lawful.
English Summary
Facts
The parties involved are in dispute about the fact that the German tax office requires a copy of the rental agreements from the landlady (taxpayer) as part of an income tax return. The landlady is the data controller, the tenants are the data subjects and the tax office would be the recipient of the data.
In the income tax returns for 2018 and 2019, the data controller submitted her statements of the total rental income, depreciation, administrative and maintenance expenses for the respective property for its income from letting and leasing various properties. The tax office requested a copy of the rental agreements, service charge settlements and on claimed maintenance expenses from the data controller. The controller submitted the gross and net rental income with the names of the tenants blacked out as well as the operating costs for the various apartments and documents on the maintenance expenses, but not the requested copies of the rental agreements and maintenance expenses. The data controller argued that the disclosure of the requested documents was not possible without the consent of the data subjects. Furthermore the tax office was not entitled to request the documents, as the rental agreements were not required to check the actual income.
The tax office responded with a request for the rental agreements in question, referring to the duty of cooperation of the data controller under the German Fiscal Code. The documents are necessary for the verification of the income data submitted by the controller.
The tax office rejected an objection on its decision by the data controller as unfounded and repeated the obligation to cooperate according to German fiscal code. (Abgabenordnung or AO). The duty to cooperate includes in particular the complete and truthful disclosure of the facts relevant to taxation and the provision of evidence. The tax office may, at its own discretion, determine which evidence it deems necessary within the meaning of the relevant section of the Fiscal Code. The tax office requires the names of the tenants and the respective rental agreements to verify the tax-relevant circumstances. The GDPR does not prevent the fulfillment of the obligations to cooperate, as the controller is entitled to transfer the personal data contained in the contracts for the purpose of fulfilling these tax obligations in accordance with Article 6(1)(c) GDPR.
The Financial Court Nuremberg dismissed a legal action brought by the data controller.
The data controller appealed against the decision of the Nuremberg Financial Court and argued in his appeal that the tax office request to disclose the tenants personal data violated his and his tenants fundamental right to informational self-determination. The tax office violated the protection principles of the GDPR and required the data controller to act in a manner sanctioned by criminal law, thereby exceeding its discretionary powers. Furthermore, the tenants were not informed about the unlawful storage of their personal data protected by this fundamental right.
The Financial court had been grossly negligent and in breach of duty in failing to review the tax office exercise of discretion.
The tax office argued that it acted lawfully within the scope of its investigative duties and powers to examine and clarify the facts. The personal data and information contained in the rental agreements were relevant for tax purposes, as they related to the deduction of income-related expenses and the amount of income.
The tax office requested that the appeal be rejected as unfounded.
Holding
The Federal Financial Court dismissed the appeal as unfounded. The Financial Court Nuremberg correctly assumed that the tax office was entitled to request the rental agreements from the data controller. The rental agreements are documents that can be requested for inspection by the tax office in accordance with § 97(1) AO. The request to submit the document is an administrative action within the meaning of § 118 AO. The court considered the tax offices request for the documents to be a discretionary decision by the administration.
This disclosure of documents is subject to the principle of proportionality, i.e. it must be suitable and necessary to clarify the facts, the fulfillment of the obligation must be possible for the person concerned and the use must be necessary, proportionate and reasonable
The court held that the tax office needed the rental agreements to check the tax-relevant circumstances and that these represented a suitable means. The rental agreements would contain tax-relevant information e.g. amount of the agreed rent, rent increases, the composition of the rent, the scope of the right of use and the actual implementation of the rental. The tax office had no other equally effective means of clarification. The income tax returns and income documents of the data controller were insufficient as a means of control, as they are prepared without the involvement of the tenants. Personal data of the tenants are required in order to be able to allocate the payment flows to the respective tenancy.
The tenants data in the rental agreements are personal data pursuant to Article 4(1) GDPR and the disclosure by the data controller constitutes a data processing operation pursuant to Article 4(2) GDPR.
It was also possible for the data controller to disclose the tenants data because she is entitled to do so under Article 6(1)(c) GDPR in conjunction with § 97 AO. Accordingly, the court held that data processing by disclosing the rental agreements to the tax office is considered lawful if it is necessary for the fulfillment of a legal obligation to which the controller is subject. In this case, the court considered this legal obligation to be based on § 97 AO.
The subsequent data processing by the tax office is also lawful, as § 29(b) AO allows the processing of personal data by the tax authority if it is necessary for the exercise of public authority. The court found that Section 29(b) Fiscal Code is the national legal basis for data processing in conjunction with Article 6(1)(e) GDPR.
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English Machine Translation of the Decision
The decision below is a machine translation of the German original. Please refer to the German original for more details.
Request for Documents by the Tax Authority Key Principles 1. The request for documents, including rental agreements by the Tax Office (FA), directed at the landlord (taxpayer) under Section 97 of the Fiscal Code (AO), must adhere to the provisions of the General Data Protection Regulation (GDPR). 2. Tenant consent for disclosure to the FA is not required, as processing is justified under Article 6(1), subparagraph 1(c) of the GDPR. 3. The transmission of rental agreements to the FA is generally permissible as a change of purpose under Article 6(4) of the GDPR. Procedural Background prior: Nuremberg Fiscal Court, February 1, 2023, Case No: 3 K 596/22, Judgement Ruling The plaintiff’s appeal against the judgement of the Nuremberg Fiscal Court dated 01.02.2023 – 3 K 596/22 is dismissed as unfounded. The plaintiff shall bear the costs of the appeal. Facts of the Case I. 1. At issue is the legality of a document request by the tax authorities. 2. With her income tax returns for the years 2018 and 2019, the plaintiff and appellant (the plaintiff) provided, among other things, lists of total rental income, depreciation, management and maintenance expenses, and other expenses related to her rental income from various properties. In the course of processing these returns, the defendant and appellee (Tax Office — FA) requested copies of the current rental agreements, utility bills, and evidence of claimed maintenance expenses for the property at … in … via a letter dated 08.06.2021 and a reminder on 13.07.2021. In response, the plaintiff submitted a list of gross and net rental income with tenant names redacted, as well as utility expenses for the various units and documents for maintenance expenses, but did not provide the requested rental agreements and utility bills. She argued that disclosing these documents would require tenant consent in line with the GDPR and that the FA was not entitled to request the documents, as rental agreements were not suitable for verifying actual income. The FA reiterated its request on 02.09.2021 and in a reminder dated 28.09.2021, citing the plaintiff’s cooperation duties under Sections 90, 93, and 97 AO, for the purpose of verifying the declarations made in the tax return. 3. The FA dismissed the appeal against this request as unfounded in a decision dated 28.04.2022. It stated that taxpayers are required under Section 90(1) AO to assist in fact-finding and that the duty includes disclosing material facts fully and truthfully, along with providing known evidence. The FA can, at its discretion, determine which evidence is required under Sections 92 et seq. AO. The cooperation duty includes the obligation to provide documents (Sections 97, 92 sentence 2 no. 3 AO). Cooperation may be required as long as it is necessary, proportionate, feasible, and reasonable for determining tax-relevant facts. The FA needs the tenants’ names and the respective rental agreements to verify tax-relevant circumstances. The agreements reveal, among other things, the agreed-upon rents, rent increases, deviations from actual payments, the composition of rent, the apportionability of utility costs, the scope of the tenants' rights with potential landlord reservations, or even the mere execution of (private) rentals. The request for documents is therefore an appropriate means of elucidating tax-relevant circumstances. Moreover, the request is necessary, as no equally effective alternative exists. Private records provided by the taxpayer lack comparable evidentiary value as they are one-sided, unlike rental agreements, which involve another party. The names of tenants are also necessary to allocate payments to individual rental relationships. The request is also reasonable, posing no disproportionate burden on the plaintiff compared to the legitimate purpose of determining taxes. The GDPR principles do not conflict with the cooperation duties, as the plaintiff is entitled to collect and process the personal data in the agreements for the purpose of meeting these tax obligations (Art. 6(1), subparagraph 1(c) GDPR). The right to “process” includes the right to transfer data to the tax authority. 4. The claim to the Fiscal Court (FG) was unsuccessful. The FG dismissed the claim, as published in Fiscal Court Decisions 2023, 604. 5. The plaintiff contends in her appeal that the FA’s requests violate the fundamental rights to informational self-determination of both herself and her tenants (Art. 2(1) in conjunction with Art. 1(1) of the Basic Law — GG). She asserts that this was an external audit, making the requests unlawful due to the lack of an audit order. She argues that this was an inadmissible “fishing expedition.” 6. The FG allegedly grossly neglected its duty by failing to review the FA’s discretionary actions. The potential rents derived from the agreements are clearly irrelevant for taxable income as cash accounting taxpayers. Even a comparison with local rent levels is possible based solely on the actual income. The disclosure of rental agreements is neither necessary nor appropriate, and the personal data of tenants is of no fundamental interest to the FA. The FA allegedly violates GDPR protection regulations and does not inform tenants about the unlawful storage of their constitutionally protected data. The FA allegedly exceeded its discretion by requesting the plaintiff to engage in criminally punishable conduct. The requests are also unlawful because the storage of rental agreements is not required by tax laws (cf. Federal Fiscal Court (BFH) ruling of 12.02.2020 - X R 8/18). According to the BFH decision of 24.06.2009 - VIII R 80/06 (BFHE 225, 302, BStBl II 2010, 452), existing records that the taxpayer is not required to keep are not “relevant for taxation” under Section 146(6) AO if they are not essential for tax assessment. The same should apply to the obligation to provide documents under Section 97 AO for surplus income, as a stricter obligation compared to profit earners would violate the principle of equal treatment. 7. Finally, the plaintiff raises various procedural errors. 8. The plaintiff requests that the judgment of the Nuremberg Fiscal Court dated 01.02.2023 – 3 K 596/22, and the FA's orders dated 08.06.2021, 02.09.2021, 28.09.2021, and 13.07.2021 requiring the provision of rental agreements, rental amendments, and utility bills for the property … in …, in the form of the objection decision dated 28.04.2022, be overturned. 9. The FA requests that the appeal be dismissed as unfounded. 10. The FA argues that this is not a “fishing expedition,” but that it lawfully acted within its investigative duties and powers to verify and clarify the facts. The information in the rental agreements regarding the effective establishment of the tenancy, the net cold rent, the apportionability of utilities, agreements regarding required maintenance, the scope of the tenant's right of use, and ultimately information about the tenant is tax-relevant as it pertains to allowable expenses and the amount of income. The agreements also help determine and clarify the local customary rent, particularly in related-party situations. 11. The ruling signed by the judges of the Senate was delivered to the registry on 13.08.2024. Upon telephone inquiry, the registry informed the plaintiff’s legal representative of the ruling on 14.08.2024. Reasons for the Decision II. 12. The appeal is unfounded and is dismissed pursuant to Section 126(2) of the Fiscal Court Code (FGO). 13. The FG correctly concluded that the FA was entitled to demand the rental agreements from the plaintiff. As the data controller under Article 4 No. 7 GDPR, the plaintiff was not entitled to refuse to disclose tenant data. 14. 1. The FA was also entitled to demand the rental agreements from the plaintiff under GDPR regulations. 15. a) Pursuant to Section 97(1) sentence 1 AO (as amended by the Act on the Implementation of the Mutual Assistance Directive dated 26.06.2013, BGBl I 2013, 1809, 1834), parties and other individuals are required to provide books, records, business papers, and other documents to the tax authority for inspection and review upon request. The demand to provide documents constitutes an administrative act under Section 118 AO (see Roser in Gosch, AO § 97 para. 11; Seer in Tipke/Kruse, § 97 AO para. 14; Baum in AO - eCommentary [21.06.2023], § 97 AO para. 13) and should be seen in conjunction with requests for information under Section 93 AO (BRDrucks 139/13, p. 195: equivalent investigative tools). 16. It is an administrative discretion decision. Such a decision can be judicially reviewed under Section 102 FGO to determine if the administrative act is unlawful because the legal limits of discretion have been exceeded or the discretion has been exercised in a manner inconsistent with the purpose of the authority (§ 5 AO). To enable this review, which does not allow the court to substitute its own discretion, the administrative decision must be justified in the administrative act or, at the latest, in the objection decision (cf. BFH judgment dated 15.09.1992 - VII R 66/91, BFH/NV 1993, 76, section 2.b; BFH ruling dated 05.04.2022 - VIII B 42/21, para. 7; Baum in AO - eCommentary [21.06.2023], § 97 AO para. 16). 17. aa) Section 97 AO is not excluded in this case under Section 200(1) sentence 2 AO. 18. (1) In the context of an external audit, Section 97 AO is superseded by Section 200(1) sentence 2 AO (Klein/Rätke, AO, 17th ed., § 97 para. 1; Roser in Gosch, AO § 97 para. 3; Niewerth in Lippross/Seibel, Basic Commentary on Tax Law, Status 119, 04.2020, § 97 AO para. 2). If an audit order under Section 196 AO is missing, a restriction on use may apply in certain circumstances. 19. (2) For distinguishing between investigations within an external audit and individual investigations, the decisive factor is how the tax authority's actions appear from the perspective of the affected party (cf. BFH judgment dated 25.11.1997 - VIII R 4/94, BFHE 184, 255, BStBl II 1998, 461, section II.2.b). What matters is how the taxpayer, based on the legal principles developed for Section 133 of the Civil Code, could understand the intent of the investigative measures in light of good faith (BFH judgment dated 02.02.1994 - I R 57/93, BFHE 173, 487, BStBl II 1994, 377, section II.B.1). Generally, measures by an external auditor aimed at investigating a tax case are assumed to be audit actions. 20. (3) The FG did not consider the FA's document requests as audit actions. This evaluation binds the Senate under Section 118(2) FGO and can only be reviewed on appeal if it violates logical principles or empirical rules. That is not the case. The FG correctly noted that no audit order had been issued nor was an audit scheduled at the plaintiff's premises. Instead, the contested FA demands were all issued in temporal connection with the submission of the 2018 and 2019 income tax returns. This indicates that the FA acted within its assessment activities. 21. bb) The request for documents is subject to the principle of proportionality, meaning it must be suitable and necessary for fact-finding, feasible for the affected party, and the demand must be necessary, proportionate, and reasonable (cf. BFH judgment dated 23.10.1990 - VIII R 1/86, BFHE 162, 539, BStBl II 1991, 277, section 2.d on the right to information under Section 93 AO; Schuster in Hübschmann/Hepp/Spitaler – HHSp, § 97 AO para. 32 ff.; Klein/Rätke, AO, 17th ed., § 97 para. 12; Roser in Gosch, AO § 97 para. 13). 22. (1) The document requested must be suitable for fact-finding. This is not the case if the documents are irrelevant for tax purposes. Tax-relevant facts include everything that can affect the tax authority's decisions in a tax administration proceeding (cf. Schuster in HHSp, § 93 AO para. 10). The “facts” in this sense that must be disclosed only need to be possible within a forecast decision framework (BFH judgment dated 29.10.1986 - VII R 82/85, BFHE 148, 108, BStBl II 1988, 359, consistent case law). The tax authority must decide this based on a preliminary assessment of the evidence. In the interest of lawful and equal taxation and to uphold the constitutionally mandated principle of verification, the requirements for this forecast decision should not be set too high (cf. BFH judgment dated 29.07.2015 - X R 4/14, BFHE 251, 112, BStBl II 2016, 135, paras. 40 ff.). 23. (2) The requested documents must be necessary. This is not the case if the tax-relevant facts are obvious or definitively established. 24. (3) The taxpayer or other person must be able to present the requested documents. A prohibition on providing a document, whether privately issued or contractually agreed upon, does not make the public-law obligation to present documents unenforceable (BFH judgment dated 16.05.2013 - II R 15/12, BFHE 241, 211, BStBl II 2014, 225, para. 43; Schuster in HHSp, § 97 AO para. 36, with further references). 25. (4) Finally, the request for documents must be proportionate in a narrower sense. The time, personnel, and material (financial) expenditure for the person required to produce the document must not be obviously disproportionate to the “additional” fact-finding expected from this evidence (Schuster in HHSp, § 97 AO para. 39). 26. b) Applying these principles, the FA's contested requests for documents were lawful. 27. aa) In its objection decision, the FA stated that it required the rental agreements to verify tax-relevant conditions and that they represented a suitable means. The agreements — in conjunction with other documents if applicable — reveal, among other things, the agreed rent, rent increases, deviations from actual payments, the composition of rent, the apportionability of utilities, the scope of the tenants’ usage rights, and the actual performance of the rental activity. No other equally effective means of clarification was apparent. Specifically, the plaintiff’s private statements do not serve as a comparable substitute because they were prepared solely by her — without tenant involvement. The tenants' names are required to allocate payment flows to the respective rental relationships. 28. These considerations reveal no errors in discretion. In particular, questions about the specific rooms allocated to a tenant (including parking spaces, garages, cellars, gardens, etc.) and about the amount of the agreed payment relevant under Section 21(2) of the Income Tax Act (cf. Senate judgment dated 22.02.2021 - IX R 7/20, BFHE 272, 200, BStBl II 2021, 479, para. 11, with further references) can only be reliably clarified through the rental agreements. The utility bills are relevant for the amount of income and for verifying the actual execution of the rental relationship. Finally, the tenants' names are necessary to determine if a related-party rental relationship exists (§ 15 AO). In cases of doubt, the tax authority must be able to question tenants as “other persons.” 29. The tax authority was not obliged to immediately question the tenants as a less intrusive measure. Regardless of the fact that the FA did not know all tenants, third parties should only be involved when clarification by the party concerned has not been successful (§ 97(1) sentence 3 in conjunction with § 93(1) sentence 3 AO). The plaintiff's effort to provide the rental agreements is also not disproportionate to the intended informational gain for the tax administration. 30. bb) Disclosure of tenant data was also not impossible for the plaintiff because it does not constitute an unlawful processing under Article 6(1) GDPR. Regardless of whether the GDPR applies to the processing activities managed by the plaintiff as landlord, particularly regarding disclosure to the FA (Article 2(1) GDPR), tenant consent was not required. The plaintiff was entitled to disclose the tenants' personal data under Article 6(1), subparagraph 1(c) and (2) GDPR in conjunction with §§ 29b(1), 97 AO. 31. (1) The FG did not assess whether the GDPR substantively applies to the processing activities conducted by the plaintiff as a landlord, particularly regarding disclosure to the FA. 32. The tenants' data are clearly personal data under Article 4 No. 1 GDPR, and disclosure by the plaintiff constitutes a processing activity under Article 4 No. 2 GDPR (for a broad interpretation of this term, see the European Court of Justice — ECJ — Endemol Shine Finland judgment of 07.03.2024 - C-740/22, EU:C:2024:216, para. 29). Whether it concerns an entirely or partly automated processing or non-automated processing of data stored in a file under Article 2(1) GDPR was not determined by the FG. However, processing would in any case be justified under Article 6(1), subparagraph 1(c) GDPR. Accordingly, processing is lawful when necessary to fulfill a legal obligation to which the data controller is subject. This legal obligation of the plaintiff arises from Section 97 AO. 33. (2) A permissible change of purpose under Article 6(4) GDPR is present. The disclosure of tenants’ personal data by the plaintiff constitutes processing (Article 4 No. 2 GDPR) for a purpose other than that for which the data were originally collected, namely for executing rental agreements (Article 6(1), subparagraph 1(b) GDPR). The disclosure obligation to the FA is based on Sections 29b, 93, and 97 AO as national provisions within the meaning of Article 6(4) GDPR. Moreover, it represents a necessary and proportionate measure in a democratic society within the meaning of Article 6(4) GDPR, fulfilling one of the objectives listed in Article 23(1) GDPR. Among these objectives, Article 23(1)(e) GDPR includes the protection of significant economic or financial interests of the Union or a Member State, such as in monetary, budgetary, and tax matters, including tax collection and anti-fraud efforts (cf. ECJ judgment "SS" SIA against Valsts ieņēmumu dienests dated 24.02.2022 - C-175/20, EU:C:2022:124, para. 70, with further references). The Senate has already affirmed that the request for documents is necessary and proportionate in the case at hand (under II.1.b aa). Finally, the plaintiff’s obligation as the data controller to inform tenants of further processing for a different purpose under Article 13(3) GDPR does not affect her duty to disclose. 34. (3) The plaintiff’s argument — not further specified — that the request is unreasonable because it requires her to engage in criminally sanctioned behavior cannot succeed. This allegation may refer to Section 42 of the Federal Data Protection Act (BDSG). These provisions cover particularly serious violations of personal data protection (cf. Becker in Plath, DSGVO/BDSG/TTDSG, 4th ed., 2023, § 42 BDSG para. 2; Taeger/Gabel/Wybitul/Zhou, 4th ed., 2022, BDSG § 42 para. 1). Section 42(1) BDSG concerns the unlawful transfer or making data accessible to a large number of people by a third party on a commercial basis. Section 42(2) BDSG addresses cases in which unauthorized processing of personal data occurs, or someone obtains data through false information and acts in each case for compensation or with intent to benefit or harm. These prerequisites are evidently not met, which the plaintiff does not seriously contend. 35. cc) The FA was also permitted to process the data from the rental agreements. 36. (1) The processing of personal data — which includes the collection and recording of data under Article 4 No. 2 GDPR — is only lawful if at least one of the conditions in Article 6(1) GDPR is met (a prohibition with a reservation of permission, see, for instance, Wackerbeck in HHSp, § 29b AO para. 9, with further references). This includes, among other things, Article 6(1), subparagraph 1(e) GDPR, which permits processing necessary for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller. For this, a legal basis is required under Article 6(3) sentence 1(b) GDPR, which the German legislator established through the Act Amending the Federal Supply Act and Other Provisions dated 17.07.2017 (BGBl I 2017, 2541) with Section 29b AO (cf. Senate judgment dated 05.09.2023 - IX R 32/21, BFHE 281, 6, BStBl II 2024, 159, para. 21). Section 29b AO authorizes tax authorities to process personal data for all measures pertaining to tax procedural law, provided the conditions specified therein are met. The Senate has stated in its decision dated 05.09.2023 - IX R 32/21 (BFHE 281, 6, BStBl II 2024, 159) that this provision meets the requirements of Article 6(3) sentence 2, alternative 1 GDPR and does not contravene the prohibition of duplication of norms under EU law. 37. (2) As previously determined by the Senate, the tax authorities’ authority to request documents from either the involved parties (§ 97(1) sentence 1 AO) or third parties (sentence 3 of this provision) and to collect and process personal data derives conclusively from the generally applicable preliminary norm for all tax procedural law — Section 29b AO (Senate judgment dated 05.09.2023 - IX R 32/21, BFHE 281, 6, BStBl II 2024, 159, para. 55). The necessity of processing has been confirmed by the Senate following the above discussions on Section 97 AO. 38. 2. The FG’s ruling does not contain procedural errors. 39. a) There is no surprise decision (Article 103(1) GG in conjunction with § 96(2), § 119 No. 3 FGO) since the issue of whether an external audit existed was addressed by both the plaintiff in her statements dated 02.06.2022 and 31.07.2022, and by the FA in its statement dated 24.06.2022 (cf. BFH ruling dated 22.07.2014 - XI B 103/13, para. 15). Ultimately, the plaintiff’s complaint that the FG did not adopt her legal view does not constitute a violation of the right to be heard. 40. b) The plaintiff’s complaint of a procedural defect due to denial of her right to inspect the “permanent documents” file is also unfounded. 41. aa) The right to be heard only guarantees parties the right to inspect the court’s files — including the files obtained — that are in the court’s possession. The defendant tax authorities are required under § 71(2) FGO to submit the tax files to the court ex officio after receiving the complaint. The right to be heard does not necessitate the FG to notify the plaintiff expressly that the FA fulfilled its legal obligation to submit the files. According to established case law, notification is only required if the involvement of files would otherwise come as a surprise to the parties, as might be the case with files from a different proceeding (cf. BFH ruling dated 19.01.2011 - X B 204/10, para. 10, with further references). 42. bb) No violation of the right to be heard has occurred. By letter dated 24.06.2022, the FA submitted the following files to the FG: income tax file, permanent document file, and legal recourse file. The FG notified the plaintiff’s legal representative of this letter on 01.07.2022. The legal representative did not request file inspection. Although the plaintiff claims that the FG read excerpts from the permanent document file during the oral hearing, this is not evident from the hearing record. Moreover, the plaintiff could have requested timely inspection of this file or requested an adjournment if necessary. 43. c) The plaintiff cannot successfully claim a violation of the lawful judge under Article 101(1) sentence 2 GG by raising the first-instance judges’ bias for the first time in the appeal proceedings. 44. aa) An application for recusal lacks a legal interest if submitted after the close of the proceeding, provided the recusal — even if justified — could not affect the court’s decision (BFH decisions dated 10.12.2014 - V B 145/14, para. 14, and 21.10.2015 - V B 36/15, para. 18). 45. bb) In the first-instance proceeding, the plaintiff, as shown in the FG file, did not submit an application for recusal. In her letter dated 31.07.2022, she merely requested the judges to disclose their individual knowledge of the procedural history “in consideration of the requirement for a recusal application and to examine her individual concern.” 46. d) The plaintiff’s claim that the FG should have referred Section 97 AO to the European Court of Justice (ECJ) under Article 267 of the Treaty on the Functioning of the European Union (TFEU) or to the Federal Constitutional Court (BVerfG) under Article 100(1) GG does not constitute a procedural defect. As a court of first instance, the FG is authorized but not obligated to submit a preliminary ruling request to the ECJ under Article 267(2) TFEU (BFH ruling dated 11.08.1999 - VII B 162/99, juris, with further references). If the FG refrains from a referral under Article 100(1) GG to the BVerfG, this also does not constitute a procedural defect, as the constitutionality of laws is a substantive and not a procedural issue (BFH ruling dated 15.10.2019 - VIII B 70/19, para. 21). 47. e) Finally, the plaintiff’s complaint regarding the deprivation of the lawful judge due to “pseudo-judicial decisions” and an alleged “potential manipulation of lay judges” is unsubstantiated. 48. 3. A preliminary ruling request by the Senate to the ECJ under Article 267(3) TFEU is not necessary. 49. a) Contrary to the lower court’s view, the case does contain relevant questions regarding the interpretation of EU law. However, this does not oblige the Senate to seek a preliminary ruling from the ECJ. A referral under Article 267(3) TFEU is not required if there is established ECJ case law (“acte éclairé”) on the matter or if the correct application of EU law is so obvious that no reasonable doubt remains, known as “acte clair” (ECJ judgment Srl CILFIT and Lanificio di Gavardo SpA against Ministero della Sanità dated 06.10.1982 - C-283/81, EU:C:1982:335, paras. 13 ff.; cf. also BVerfG ruling dated 04.03.2021 - 2 BvR 1161/19, para. 55; Wegener in Calliess/Ruffert, EUV/AEUV, 6th ed., Art. 267 TFEU para. 33; Schönfeld, Internationales Steuerrecht 2022, 617, 623). 50. b) Based on these standards, a preliminary ruling is not required in this case. ECJ case law already establishes that tax collection — along with combating tax fraud — is a task of public interest under Article 6(1), subparagraph 1(e) GDPR (ECJ judgment “SS” SIA against Valsts ieņēmumu dienests dated 24.02.2022 - C-175/20, EU:C:2022:124, para. 70). Furthermore, the ECJ’s ruling in Norra Stockholm Bygg dated 02.03.2023 - C-268/21, EU:C:2023:145 thoroughly addresses the requirements for a change of purpose under Article 6(4) GDPR. The Senate has applied these principles of case law. 51. 4. The plaintiff's statements and legal arguments in her submissions following the pronouncement of the judgement are not material, as the Senate is bound by its decision. 52. A judgement is validly issued under Section 104(1) FGO upon pronouncement. Instead of pronouncement, the judgement may be delivered — as in this case — under Section 104(2) FGO, and it must be transmitted to the registry within two weeks after the oral hearing. According to established case law, this provision is satisfied even if only the signed judgement (ruling) is timely transmitted to the registry. The informal communication of the judgement to a party renders the decision pronounced. The court is then bound by its decision (cf. Senate decision dated 18.09.2014 - IX B 9, 19/14, para. 9); reopening the oral hearing is no longer possible. 53. 5. The cost decision is based on Section 135(2) FGO.
