Germany Told to Pay Mostly EON, RWE $3 Billion in Nuclear Taxes

A Hamburg court ordered Germany to pay back utilities, mostly EON SE (EOAN) and RWE AG (RWE), a combined 2.2 billion euros ($3 billion) in nuclear-fuel taxes after they mounted a legal challenge to the charges introduced in 2011.

Customs offices must repay five reactor operators, the finance court said today in a statement. EON’s refund is about 1.7 billion euros, said Josef Nelles, a company spokesman. RWE’s is about 400 million euros, said Annett Urbaczka, a spokeswoman.

“This verdict once again confirms serious doubts over the constitutionality of the nuclear-fuel tax and its compatibility with European Union law,” Nelles said by phone from Dusseldorf, where EON is based. The customs offices are able to challenge the ruling at the Federal Finance Court, Urbaczka said.

German utilities have won cases in Hamburg and Munich, while a Stuttgart court approved the tax. Today’s ruling affects the Grafenrheinfeld, Isar-2, Emsland, Grohnde and Brokdorf reactors, said Matthias Tiemann, a court spokesman. The Hamburg court has asked the European Court of Justice and Germany’s top constitutional court to review whether the tax is valid. Customs offices have a month to file a complaint against the decision and it’s “not unlikely” they will, Tiemann said.

“As soon as one of the two courts will rule the nuclear-fuel tax illegal, plant operators will win the lawsuit,” said Tiemann. The court expects a decision by EU judges in 18 months to two years since starting in January, he said, declining to give a forecast for a ruling from the constitutional court.

The Hamburg court sees the tax as unconstitutional, it said in the statement. The tax “doesn’t tax the use of nuclear fuel or electricity but is to skim profits of plant operators.”

“This decision initially does not have any impact on EON’s Ebitda and net income,” EON said in an e-mailed statement.

To contact the reporters on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net; Nicholas Brautlecht in Hamburg at nbrautlecht@bloomberg.net

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net Tony Barrett, Randall Hackley

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