In the Nestlé Finance case, a cash pool/treasury activity was transferred to a related Swiss entity.
The function had been purely administrative, carried out exclusively for the benefit of parties related to the French company. The French company did not receive any compensation for the transfer of the cash pooling activity.
First the Administrative Court concluded that the transfer of an internal administrative function to a foreign entity – even if the function only involved other affiliated companies ‘captive clientele’ – required the payment of arm’s-length compensation.
This decision was then appealed and later revoked by a decision of the Administrative Court of Appeals.France vs Nestlè Finance 5 Feb 2013 CAA no 12PA00469