Yesterday (16 February), the Commission sent a reasoned opinion to the UK, requesting it to bring its legislation into line with EU legislation on asbestos. The Commission is arguing that the asbestos Directive has not been properly transposed in UK legislation. Particularly Article 3 of the Directive whereby member states might be exempted from obligations provide in the directive for activities that involve only sporadic and low intensity exposure to asbestos, such as some maintenance and repair activities.

According to the Commission the UK law widens the scope of this derogation. The UK now has two months to change its legislation that exempt some maintenance and repair activities from the application of the EU directive, otherwise, the Commission may decide to refer the UK to the ECJ.

The Commission has also sent reasoned opinions to the UK concerning legislation on the transfer of assets abroad and attribution of gains to members of non-UK resident companies.

According to the Commission both laws are discriminatory “as investments outside the UK are taxed more heavily than domestic investments.” Moreover, the Commission stressed “The difference in tax treatment between domestic and cross-border transactions restricts two fundamental principles of the EU's Single Market, namely of the freedom of establishment and the free movement of capital…”

The Commission is, therefore, requesting the UK to amend its anti-abuse tax regime. The UK has now two months to amend its national rules in order to comply with the reasoned opinions, failing this, the Commission may lodge cases against the UK with the ECJ.

The ECJ may fine the UK if it fails to bring national legislation into line with EU legislation.