Defence date: 22 November 2018 ; Supervisor: Prof. Giorgio Monti (European University Institute) ; In the recent years, many companies face legal proceedings of the European Commission against their tax arrangements (tax rulings). The fact that the Commission investigates in State aid issues is not a novelty, but the tools it uses have changed. Since 2013 the Commission has repeatedly challenged tax rulings that lack compliance with the so-called arm's length principle and has changed the way of assessing individual elements of Art. 107 para. 1 TFEU. Naturally, this has provoked wide criticism from scholars, the affected parties and foreign governments that fear for their own tax revenue. This criticism is the starting point for this thesis. In a doctrinal study, they will be tested against the written law and the case-law of the European Court of Justice. In particular, the power-to-tax cases bear valuable insight in how the European Court of Justice perceives the arm's length principle and how it must be applied. Eventually, I will find that the Commission's approach does not infringe this case-law but needs more thoroughness and conscientious reasoning. The Commission takes some mental leaps in its logic that - even though leading in the right direction - must be filled with sound and consistent argumentation. This concerns mainly the reasons on whether integrated group companies and independent stand-alone companies are in a similar legal and factual situation, which the Commission seems to simply assume without giving an extensive explanation why, and on why the Commission conflates the element of selectivity with the element of advantage.