France: Capital ownership non-discrimination clause of Swiss treaty does not extend French horizontal tax consolidation regime (Supreme Administrative Court decision)
French subsidiaries of Swiss parent cannot rely on treaty’s non discrimination clause to access horizontal grouping.
The Supreme Administrative Court on January 20, 2026, held that the capital ownership non‑discrimination clause in the France–Switzerland income tax treaty does not extend the scope of France’s horizontal tax consolidation regime.
The court held that French subsidiaries owned by a Swiss ultimate parent entity cannot rely on the treaty’s non‑discrimination clause to access horizontal grouping available only to EU/EEA‑owned structures.
It confirmed that the relevant comparison under article 26(5) of the treaty is limited to purely domestic situations and does not mirror EU freedom of establishment rules.
For more information, contact a KPMG tax professional in France:
Patrick Seroin Joly | pseroinjoly@kpmgavocats.fr
Marie-Pierre Hôo | mhoo@kpmgavocats.fr