In a recently published decision of 19 February 2008, the Financial Court of Düsseldorf (Finanzgericht Düsseldorf) ruled on the application of Sec. 1 of the Foreign Tax Act (FTA) and expressed doubts about that provision's compatibility with EC law. Details of the decision are summarized below. (a) Facts. The plaintiff, a German resident, held a 75% participation of a UK resident company. The plaintiff granted an interest-free loan to the UK company during the company's start-up period in 1982. Neither a loan agreement was concluded, nor securities were provided. In 1996, the tax authorities adjusted the taxpayer's income assuming an...