Joined cases of X BV (C‑24/12), and TBG Limited (C‑27/12) v Staatssecretaris van Financiën. Ruling of 5 June 2014.

The case raises the issue as to whether a Member State, here the Netherlands,  can discriminate more or less actively against its own associated territory, here the Dutch Antilles, than it can as against other Member State's Associated Territories in the context of the EU freedoms of movement of payment  and that of capital.

The ruling is simple: "European Union law must be interpreted as not precluding a tax measure of a Member State which restricts movements of capital between that Member State and its own overseas country and territory whilst pursuing the objective of combating tax avoidance in an effective and proportionate manner."

However, it has to be both proportionate and effective for the incursion on the freedom to be acceptable.

The issue is also whether this only applies to Associated Territories whose relationships are defined by Part IV of the Treaty, and elaborated on by Council's then OCT Decision, or can this be extended to the Protocol 3 Crown Dependencies, Jersey Guernsey and the Isle of Man?

Compare the position of the Bermudas, the BVI and the other Caribbean Financial Centres, which are OCTs.

In the author's view, there is insufficient Treaty "traction" for that to happen, provided that the Islands remain in a position to remind the ever vehement Khmer Rouge in the UK that article 227 EEC  and its appendage Protocol 3 does no more than reflect their existing relationships with the UK, as at 1972.  It does not grant the UK new powers, as appears now to have happened in the case of the UK Associated Territories