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Tax & Financial Standards New Judgments of the ECJ For July 2020

29.07.2020

Tax & Financial Standards New Judgments of the ECJ For July 2020

Tax & Financial Standards New Judgments of the ECJ For July 2020

New judgments

С-215/19 of 02 July 2020

Supply of services — VAT exemption — Leasing or letting of immovable property — Place of supply of services — Supply of services connected with immovable property — Server cabinets — Storage services in computing centre — Concept of „immovable property “

Key aspects of the decision in the economic range:

Interpretation of the VAT Directive concerning the tax treatment of the supply of services as "services for storage in the data center." Leasing or letting of immovable property services, to which a VAT exemption applies. Computing centre services, with which a trader provides its customers with equipment cabinets in a computing centre for holding customers’ servers together with ancillary services.

Concept of „immovable property “

Proceedings concerning the determination of the place where the value added tax is collected for storage services provided in a computing centre.

С-231/19 of 02 July 2020

Value added tax (VAT) — Exemptions — Exemption of transactions for the management of special investment funds — Single supply used for the management of special investment funds and for other funds) — Concept of a ‘single supply’

Key aspects of the decision in the economic range:

A single supply of management services, provided by a software platform belonging to a third-party supplier for the benefit of a fund management company, which manages both special investment funds and other funds, does not fall within the exemption provided for in that provision. Supply of a package of services using an IT platform.

Concept of a ‘single supply’.

Proceedings between B and the tax authority, concerning that tax authority’s refusal to grant B the benefit of the exemption from value added tax (VAT) provided for in Article 135(1)(g) of the VAT Directive.

С-835/18 of 02 July 2020

Invoice correction — Tax invoiced incorrectly — Refund of tax paid but not due — Reverse charge mechanism for VAT — Transactions relating to a tax period that has already been the subject of a tax inspection — Fiscal neutrality — Principles of effectiveness and proportionality

Key aspects of the decision in the economic range:

Adjustment of tax improperly invoiced. A national administrative practice preventing a taxable person that has carried out transactions which subsequently proved to be covered by the reverse charge mechanism for VAT from correcting the invoices relating to those transactions and relying on them with a view to obtaining a refund of the VAT improperly invoiced and paid by that taxable person.

Proceedings concerning an application for annulment of a tax assessment denying a company the right to a refund of value added tax (VAT) and requiring payment of additional tax.

С-76/19 of 09 July 2020

Community Customs Code - Determination and adjustment of the customs value - Royalties relating to the goods being valued. Royalties constituting a ‘condition of sale’ of the goods being valued. Royalties paid by the buyer to its parent company for the supply of the know-how required for the manufacture of the finished products - Goods purchased from third parties, which constitute components to be incorporated in the licensed products

Key aspects of the decision in the economic range:

Customs union. Incidence of royalties and licence fees in customs value. Proportion of the royalties paid by a company to its parent company in consideration for the supply of know-how for the manufacture of finished products that must be added to the price actually paid or payable for imported goods in circumstances where those goods are intended to be included, along with other component parts, in the composition of those finished products and are purchased by the former company from sellers separate from the parent company.

Proceedings between the Director of Customs and C concerning the taking into account of fees paid by the latter to its parent company when determining the customs value of goods imported from third parties.

С-81/19 of 09 July 2020

Unfair terms in consumer contracts - Loan agreement denominated in a foreign currency — Term relating to the foreign exchange risk - Definition of ‘mandatory statutory or regulatory provisions’

Key aspects of the decision in the economic range:

Consumer protection against unfair terms in foreign currency loan agreements. A contractual term which has not been individually negotiated but which reflects a rule that, under national law, applies between contracting parties.

Definition of ‘mandatory statutory or regulatory provisions’.

Proceedings between concerning the alleged unfairness of a term of a refinancing agreement denominated in a foreign currency that was concluded between the parties.

С-264/19 of 09 July 2020

Copyright and related rights - Internet video platform - Uploading of a film without the consent of the rightsholder - Proceedings concerning an infringement of an intellectual property right - Applicant’s right of information - Email address, IP address and telephone number - Definition of ‘addresses’

Key aspects of the decision in the economic range:

Proceedings concerning an infringement of an intellectual property right. Internet-based video-sharing platform. Rightsholder’s right to information. The term ‘addresses’ does not cover, in respect of a user who has uploaded files which infringe an intellectual property right, his or her email address, telephone number and IP address used to upload those files or the IP address used when the user’s account was last accessed.

Definition of ‘addresses’.

Proceedings concerning information required by C from two companies concerning email addresses, IP addresses and mobile telephone numbers of users who infringed its intellectual property rights.

С-343/19 of 09 July 2020

Judicial cooperation in civil matters — Place where the damage occurred — Manipulation of data relating to the emission of exhaust gases from engines produced by a motor vehicle manufacturer — Concept of „Place where the harmful event occurred“

Key aspects of the decision in the economic range:

Allocation of international jurisdiction among the Member States. The “place where the harmful event occurred” may be construed as the place in a Member State where the damage occurred, when that damage consists exclusively of financial damage that is the direct result of an unlawful act committed in another Member State. Manipulation of emissions values in car engines. Concept of „Place where the harmful event occurred“.

Proceedings between an association for consumer information and a motor vehicle manufacturer, concerning the latter’s liability for damage arising from the installation in vehicles purchased by Austrian consumers of software that manipulates data relating to exhaust gas emissions.

С-374/19 of 09 July 2020

Adjustment of VAT deductions — Variation in the deduction entitlement — Capital goods used for both taxed and exempt transactions — Cessation of the activity giving rise to the right of deduction — Remaining use solely for exempt transactions

Key aspects of the decision in the economic range:

Relationship between the right to deduct input VAT and the use of the goods or services concerned for taxed output transactions. A taxable person who produces an investment object with regard to taxable use with entitlement to input tax deduction, have to adjust the input tax deduction, if he ceases the sales activity justifying the input tax deduction and the investment object now remains unused in the scope of the previously taxable use.

Proceedings concerning the adjustment of deductions of value added tax (VAT) which a company paid on the construction of a cafeteria annexed to the retirement home which it operates as an activity exempt from VAT.

С-391/19 of 09 July 2020

Customs Union — Authorization to use a specific use mode — Retroaction — Change in the tariff classification — Termination of the validity of a decision relating to binding tariff information — Concept of 'exceptional circumstances'

Key aspects of the decision in the economic range:

Union Customs Code. Circumstances such as the early termination of the validity of a decision relating to binding tariff information following an amendment of the Combined Nomenclature, the lack of response from the customs authorities on several imports of goods referred to the wrong code or the use of the product for an anti-dumping duty, cannot be classified as 'exceptional circumstances'.

Proceedings between U and the Director of the Territorial Directorate at the Customs Agency, concerning a few imports, which U has made, before to apply for authorization to use a specific use regime.

С-452/18 of 09 July 2020

Consumer Protection - Unfair terms in consumer contracts - Mortgage loan agreement with a variable interest rate - Term limiting the variability of the interest rate (‘floor’ term) - Novation agreement - Waiver of the right to bring an action contesting the terms of a contract

Key aspects of the decision in the economic range:

Mortgage loan agreement. Lack of transparency. Abusiveness. Conclusion by the parties of an agreement involving the novation of the “floor” clause, confirmation of the validity of the mortgage credit contract and mutual renunciation to contest it in court. The principle that void contractual terms are not binding that also extend to subsequent contracts and legal documents concerning such terms, such as a novation agreement.

Proceedings concerning terms stipulated in a mortgage loan agreement.

Joined Cases С-698/18 and C-699/18 of 09 July 2020

Personal loan agreement - Contract performed in full - Finding that contractual terms are unfair. Action for reimbursement of sums unduly paid on the basis of an unfair clause. Ordinary legal action not subject to any limitation period. Ordinary legal action of a personal and pecuniary nature subject to a limitation period– Point from which the limitation period starts to run. Objective point in time at which the consumer knows of the existence of the unfair term - Concept of ‘consumer’

Key aspects of the decision in the economic range:

Limitation periods applicable to legal actions in the field of unfair terms in consumer contracts. Possibility, after the full performance of a contract and an action for restitution of the amounts received under contractual clauses considered as unfair, to apply a limitation period of three years which begins to run from the moment the contract has ended. Judicial interpretation of the national rule according to which the legal action for reimbursement of amounts unduly paid on the basis of an unfair term in a contract concluded between a consumer and a seller or supplier is subject to a three-year limitation period which runs from the date of full performance of the contract.

Concept of ‘consumer’.

Proceedings concerning the unfairness of certain terms of credit agreements.

С-716/18 of 09 July 2020

VAT - Special scheme for small enterprises - Method for calculating annual turnover serving as a reference for the application of the special regime for small businesses - Rental of real estate by a natural person exercising several liberal professions - Concept of „ incidental real estate transaction“

Key aspects of the decision in the economic range:

The VAT Directive. Exemption below certain turnover limits. Calculation of that turnover exemption limit in the case of multiple economic activities.

Whether the letting of a property is to be classified as a ‘real estate transaction’ and when an immaterial ‘ancillary transaction’ is to be taken to exist.

Concept of ‘real estate transactions’ to be taken into account which are not ‘ancillary transactions’.

Concept of „ incidental real estate transaction“.

Proceedings opposing C to the tax control service for natural persons A about the method of calculating its annual turnover for the purposes of applying, in its regard, the special regime for small businesses provided for in the VAT Directive.

Joined Cases С-224/19 and C-259/19 of 16 July 2020

Consumer protection — Unfair terms in mortgage loan agreements — Clause by which all costs of establishing and canceling a mortgage are assigned to the borrower — Consequences of declaring those clauses null and void — Jurisdiction of the national court in the presence of a clause classified as "unfair"— Allocation of costs — Assessment of unfair contract terms — Exclusion of clauses concerning the main subject of the contract or the update of prices or remuneration — Obligation to compile contract terms in clear and understandable language — Legal expenses — Limitation period — Concept of "main subject of the contract"

Key aspects of the decision in the economic range:

Unfair clauses in consumer contracts. Consequences of the nullity of the clause providing for the costs of establishing and canceling a mortgage. Verification of the unfairness and transparency of the term conferring payment of commission processing. Possible significant inequalities between the rights and obligations of the parties arising from a clause providing for the payment of commission processing. Limiting the consequences of the invalidity of an unfair clause by setting a limitation period. Legislation that allows part of the court costs to be awarded to the consumer depending on the amount of unduly paid amounts reimbursed to him as a result of the invalidity of a contractual clause due to inequality. Concept of "main subject of the contract".

Two proceedings concerning unfair terms in mortgage loan agreements.

С-253/19 of 16 July 2020

Judicial cooperation in civil matters — Insolvency proceedings — International jurisdiction — Centre of a debtor’s main interests — Individual not exercising an independent business or professional activity — Rebuttable presumption that the centre of that person’s main interests is his or her habitual residence — Situation in which the debtor’s sole immovable asset is located outside the Member State of habitual residence - Term ‘centre of main interests’

Key aspects of the decision in the economic range:

Connecting factor designating the courts having jurisdiction to open insolvency proceedings against a debtor. Presumption for determining international jurisdiction for the purposes of opening insolvency proceedings, according to which the centre of the main interests of an individual not exercising an independent business or professional activity is his or her habitual residence, that is rebutted solely because the only immovable property of that person is located outside the Member State of habitual residence.

Term ‘centre of main interests’.

Proceedings concerning an application to open insolvency proceedings.

С-424/19 of 16 July 2020

Value added tax - Person practising the profession of lawyer - Final judicial decision - Principle of res judicata - Scope of that principle if that decision is incompatible with EU law - Concept of ‘taxable person’

Key aspects of the decision in the economic range:

A person practicing as a lawyer who must be considered a "taxable person". National court that may not apply the principle of the authority of res judicata where the application of that principle would prevent that court from taking into account EU legislation on VAT.

Concept of ‘taxable person’.

Proceedings concerning the liability to value added tax.

С-610/18 of 16 July 2020

Social security for migrant workers — Long-distance lorry drivers normally employed in one or more Member States or States of the European Free Trade Association (EFTA) — Long‑distance lorry drivers who have entered into an employment contract with one undertaking but are in fact subject to the authority of another undertaking established in the Member State where those drivers reside — Determination of which undertaking is the ‘employer’ — Concepts of ‘person who is a member of the travelling personnel of an undertaking’ and ‘employer’

Key aspects of the decision in the economic range:

An application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community. Determination of the legislation applicable. International drivers in the road transport sector. The employer of an international long-distance lorry driver is the undertaking which has actual authority over that long-distance lorry driver, which bears, in reality, the costs of paying his or her wages, and which has the actual power to dismiss him or her, and not the undertaking with which that long-distance lorry driver has concluded an employment contract and which is formally named in that contract as being the employer of that driver.

Concepts of ‘person who is a member of the travelling personnel of an undertaking’ and ‘employer’.

Proceedings between a company, established in Cyprus, and international long-distance lorry drivers, on the one hand, and the S, Board of Management of the Social Insurance Bank, Netherlands, concerning decisions whereby the S declared that the social security legislation of the Netherlands was applicable to those long-distance lorry drivers.

С-686/19 of 16 July 2020

Consumer credit agreements — Costs related to the extension of credit — Concept of 'total cost of credit to the consumer'.

Key aspects of the decision in the economic range:

Consumer protection. Costs for extension of credit when the conditions for its possible extension are part of the terms and conditions agreed between the creditor and the borrower in the loan agreement.

Concept of 'total cost of credit to the consumer'.

Proceedings concerning the request for annulment of a decision imposing a fine on a credit institution for breach of the collective interests of consumers.

 

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