EU Internal Market
elements of the transactions concerned are confined within a single Member State (C-11/07 Eckelkamp
case, § 39).
To make the grant of a tax advantage, such as the dividend exemption, relating to taxation of the income
of natural persons who are shareholders subject to the condition that the dividends are paid by companies
established within national territory constitutes a restriction on capital movements prohibited by Article 1
of Directive 88/361 (C-35/98 Verkooijen case, § 34-36).
In relation to direct taxes, the situations of residents and of non-residents are not, as a rule, comparable.
The position is different, however, in a case such as this one where the non-resident receives no
significant income in the State of his residence and obtains the major part of his taxable income from an
activity performed in the State of employment, with the result that the State of his residence is not in a
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