ISTANBUL

US energy giant ExxonMobil has sued the EU to block the new windfall tax, which are levied on large profits of oil and natural gas companies.

ExxonMobil argued that its challenge is only against "the counter-productive" windfall profits tax, and not any other elements of the EU's package to reduce energy prices, in its filing Wednesday with the General Court of the EU.

"This tax will undermine investor confidence, discourage investment, and increase reliance on imported energy and fuel products," ExxonMobil spokesperson Casey Norton said in a statement, according to media reports. "European industries already face a very real competitiveness crisis and governments should be supporting the production of reliable and affordable energy."

The company stressed that it will be looking for "a stable and predictable climate" for its future multi-billion euro investments to secure Europe's energy supply, adding "Whether we invest here primarily depends on how attractive and globally competitive Europe will be."

EU spokesperson Arianna Podesta said the decision is now up to the General Court to rule on the case, adding "The Commission maintains that the measures in question are fully compliant with EU law."

The windfall tax, part of an EU-wide agreement that aims to redistribute some of the excess profits of energy firms, will be up to 40% for oil and natural gas companies to be applied to their profits in 2022 and 2023, which are 20% above the average of years between 2018 and 2021.

The amount of tax can be lowered to 33% if the companies would make investments in green energy.

Energy companies' earnings have skyrocketed this year as Russia's war on Ukraine has pushed oil and natural gas prices higher.