Executive summaryThe Spanish National High Court issued a Decision on 25 May 2021 (the Decision), recently published, upholding the withholding exemption for dividend payments (DWHT) by a Spanish company to a Luxembourg company. This decision overturns the criteria of the Spanish tax authorities, which had rejected the withholding exemption on the basis that the latter is not incorporated for valid business reasons. The Spanish implementation of the European Union (EU) Parent-Subsidiary Directive includes a special anti-abuse rule with certain safe harbors, one of them being that the parent entity may prove that it has been set up with a sound...