This tax regime enables shipping companies, should they wish to do so, not to pay company tax but to pay a flat-rate tax based simply on the tonnage of their fleet. The investigation concerns only some of the proposed changes since the Commission believes that the other changes are compatible with Community rules.

The first change notified by the Danish authorities is to make a larger proportion of the fleet operated by a company on the basis of shipping contracts for a given period or a specific voyage eligible for this specific tax regime. The Commission has hitherto agreed that such ships, where the shipping company is not responsible for the management of either the equipment or the crew, are covered by the tonnage tax regime, provided that they do not account for more than 80% of the total tonnage. Denmark's proposal would increase this proportion to over 90%.

The second proposed change is to include in the flat-rate tax regime all revenue which the manager of a pool of ships may receive from other shipowners who are members of the pool. In a pool, several shipowners may pool the use of a number of their ships.

The EC observed that:

"These ships are managed by a single agent, who is generally a pool member. The new measure would enable shipowners to exclude from company tax, with no restrictions, any fees which they might obtain from other shipowners for managing pools of ships, without regard, when calculating the flat-rate tax, to the tonnage of the ships in the pool not owned by them, management of which provides them with these fees."

The Commission expressed doubts as to whether companies which have still not opted for the flat-rate tax regime will be able to do so in 2007 with retroactive effect to 2001. The initial scheme provided that undertakings which wished to opt for the tonnage tax should do so in 2001 or 2002.

It explained that:

"The Commission does not object to the scheme being open to new beneficiaries. However, it has so far not accepted the retroactive application of tonnage tax regimes in other Member States which allow shipowners to opt ex post facto for the most favourable scheme in given circumstances rather than accepting in advance to be covered by the scheme which actually applies in their particular case."

"The Commission therefore doubts whether these three proposed changes are compatible with the common market. It this week decided to open a formal investigation into the changes."

And concluded:

"In addition, the Commission has approved the introduction of other changes, such as the inclusion in the flat-rate tax regime of capital gains from the sale of eligible ships and the technical amendment of an anti-abuse measure attached to this aid regime. These changes are in conformity with the applicable rules and Commission practice."