Exxon Mobil Sues to Try to Block EU Windfall Tax
Exxon Mobil tried to prevent what it called “backfire” new surprise tax imposed by the European Commission as part of an effort to cushion the impact of soaring energy prices across the 27-nation bloc.
The US oil giant’s subsidiaries in Germany and the Netherlands filed a lawsuit in the General Court of the European Union in Luxembourg on Wednesday. Now the court must decide whether to continue the case, which states that the European Council has no authority to impose taxes.
Since fossil fuel shipments to Europe were disrupted following Russia’s invasion of Ukraine in February, major oil and gas companies collected many billion dollars profits, while consumers face energy prices have more than doubled.
Exxon said earlier this year that the tax would cost the company $2 billion through 2023. The company reported a global profit of $20 billion this year.
Exxon Mobil spokeswoman Casey Norton said that while the company recognizes the burden that high energy bills have placed on homes and businesses in Europe, it does not agree that the tax collected will relieve solve the problem.
“Mr. Norton said the tax would erode investor confidence, discourage investment and increase reliance on imported fuel and energy products. “European industries have faced a very real competition crisis and governments should support affordable and reliable energy production.”
The Council of Europe, the EU’s executive arm, approved the tax under a provision that would allow it to bypass the bloc’s parliament in emergency situations, which Exxon says is beyond its jurisdiction. this agency. The tax will go into effect on December 31.
Individual EU member states have enacted their own policies to try to spread the pain of high energy bills.
This month, the German parliament passed legislation aimed at preventing rising gas and electricity bills for households and industry by imposing a ceiling on gas and electricity prices based on last year’s levels. The package sets limits on bonuses for managers of companies benefiting from the law, funded by a tax on excess profits of energy producers. The law, which is expected to raise 100 billion euros, or $106 billion, will go into effect in March but take effect retroactively from January.