Application of the theory of the abnormal act of management to profit-sharing mechanisms for executives

June 20 2022

LES auteurs

On March 11, 2022, the Conseil d’Etat set limits to the use by the tax authorities of the theory of the abnormal management act in the context of executive incentive schemes. Thus, the Conseil d’Etat ruled that the granting to an executive by a holding company of a unilateral promise to sell shares in its subsidiary at a price that was preferential at the date of exercise of the promise to sell did not constitute an abnormal management act.

Read the full article by our partner Sophie Jouniaux in Les Nouvelles Fiscales by clicking here.