Yesterday, the Court of Justice of the European Union overturned the ruling of the General Court and annulled the Commission’s decision finding that Luxembourg had granted illegal state aid to Fiat Finance and Trade Ltd, SA by accepting the transfer pricing methodology proposed by Fiat in relation to intra-group financing transactions. In doing so, the Court of Justice has put an end to the Commission’s attempt to apply its own version of the arm’s length principle, rather than the national tax framework, to determine whether a measure confers a selective advantage under state aid rules and has reaffirmed the national autonomy of EU member states in the field of direct taxation.