Grounds
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1. These references for a preliminary ruling concern the interpretation of Article 80(1) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1, ‘the VAT Directive’).
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1. It-talbiet għal deċiżjoni preliminari jirrigwardaw l-interpretazzjoni tal-Artikolu 80(1) tad-Direttiva tal-Kunsill 2006/112/KE, tat-28 ta’ Novembru 2006, dwar is-sistema komuni ta’ taxxa fuq il-valur miżjud (ĠU L 347, p. 1, iktar ’il quddiem id-“Direttiva VAT”).
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2. The references have been made in proceedings between Balkan and Sea Properties ADSITs (‘Balkan and Sea Properties’) and Provadinvest OOD (‘Provadinvest’) and the Direktor na Direktsia ‘Obzhalvane i upravlenie na izpalnenieto’ – Varna pri Tsentralno upravlenie na Natsionalnata agentsia za prihodite (Director of the Appeals and Enforcement Management Directorate, Varna, at the Central Administration of the National Revenue Agency, ‘the Director’) concerning tax assessment notices refusing them the right to deduct input value added tax (VAT).
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2. Dawn it-talbiet tressqu fil-kuntest ta’ kawżi bejn Balkan and Sea Properties ADSITS (iktar ’il quddiem “Balkan and Sea Properties”) u Provadinvest OODD (iktar ’il quddiem “Provadinvest”) rispettivament, u d-Direktor na Direktsia „Obzhalvane i upravlenie na izpalnenieto” – Varna pri Tsentralno upravlenie na Natsionalnata agentsia za prihodite (Direttur tad-Direttorat “Appell u ġestjoni tal-eżekuzzjoni” għall-belt ta’ Varna, fi ħdan l-amministrazzjoni ċentrali tal-Aġenzija nazzjonali tat-taxxa, iktar ’il quddiem id-“Direktor”), rigward avviż ta’ aġġustament tat-taxxa li jirrifjutalhom il-benefiċċju tad-dritt għal tnaqqis tat-taxxa fuq il-valur miżjud (iktar ’il quddiem il-“VAT”) tal-input imħallsa.
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Legal context
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Il-kuntest ġuridiku
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European Union law
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Id-dritt tal-Unjoni
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3. According to recital 3 in the preamble to the VAT Directive, ‘[t]o ensure that the provisions are presented in a clear and rational manner, consistent with the principle of better regulation, it is appropriate to recast the structure and the wording of [Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes – Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1)] although this will not, in principle, bring about material changes in the existing legislation. ...’
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3. Mill-premessa 3 tad-Direttiva VAT jirriżulta li “[b]iex ikun żgurat li d-disposizzjonijiet jiġu ppreżentati b’mod ċar u razzjonali, b’mod konsistenti mal-prinċipju ta’ regolamentazzjoni aħjar, huwa xieraq li l-istruttura u l-formulazzjoni tad-Direttiva [tal-Kunsill 77/388/KEE, tas‑17 ta’ Mejju 1977, fuq l-armonizzazzjoni tal-liġijiet tal-Istati Membri dwar taxxi fuq id-dħul mill-bejgħ - Sistema komuni ta’ taxxa fuq il-valur miżjud: bażi uniformi ta’ stima (ĠU Edizzjoni Speċjali bil-Malti, Kapitolu 9, Vol. 1, p. 23),] jitfasslu mill-ġdid għalkemm fil-prinċipju dan mhux ser iġib tibdil fil-leġislazzjoni eżistenti. […]”.
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4. Recital 26 in the preamble to the VAT Directive states that ‘[t]o prevent loss of tax revenues through the use of connected parties to derive tax benefits, it should, in specific limited circumstances, be possible for Member States to intervene as regards the taxable amount of supplies of goods or services and intra-Community acquisitions of goods’.
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4. Il-premessa 26 tal-istess direttiva tippreċiża li, “[g]ħall-prevenzjoni ta’ telf ta’ taxxa bl-użu ta’ partijiet konnessi sabiex jinkisbu benefiċċji fiskali, f’ċirkostanzi speċifiċi għandu jkun possibbli li l-Istati Membri jintervjenu fir-rigward ta’ l-ammont taxxabbli għall-forniment ta’ merkanzija jew servizzi u akkwisti ta’ merkanzija intra-Komunitarji fir-rigward ta’ tali kategoriji ta’ fornituri u destinatarji”.
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5. Article 12 of the VAT Directive provides:
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5. L-Artikolu 12 tal-imsemmija direttiva tipprovdi li:
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‘1. Member States may regard as a taxable person anyone who carries out, on an occasional basis, a transaction relating to the activities referred to in the second subparagraph of Article 9(1) and in particular one of the following transactions:
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“1. L-Istati Membri jistgħu jikkunsidraw bħala persuna taxxabbli lil kull min iwettaq transazzjoni, fuq bażi okkażjonali, li jkollha x’taqsam ma’ l-attivitajiet imsemmija fit–tieni subparagrafu ta’ l-Artikolu 9(1) u partikolarment waħda mit-transazzjonijiet li ġejjin:
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(a) the supply, before first occupation, of a building or parts of a building and of the land on which the building stands;
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(a) il–provvista, qabel l-ewwel okkupazzjoni, ta’ bini jew parti minn bini u ta’ l-art li fuqha jinstab il-bini;
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(b) the supply of building land.
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(b) il-provvista ta’ art għall-bini.
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2. For the purposes of paragraph 1(a), “building” shall mean any structure fixed to or in the ground.
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2. Għall-finijiet tal-paragrafu 1(a), ‘bini’ għandha tfisser kull struttura fissa ma’ jew fl-art.
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Member States may lay down the detailed rules for applying the criterion referred to in paragraph 1(a) to conversions of buildings and may determine what is meant by “the land on which a building stands”.
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L-Istati Membri jistgħu jistabbilixxu r-regoli dettaljati għall-applikazzjoni tal-kriterju msemmi fil-paragrafu 1(a) għal bdil ta’ bini u jistgħu jistabbilixxu t-tifsira ta’ ‘l-art li fuqha jinstab il-bini’.
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Member States may apply criteria other than that of first occupation, such as the period elapsing between the date of completion of the building and the date of first supply, or the period elapsing between the date of first occupation and the date of subsequent supply, provided that those periods do not exceed five years and two years respectively.
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L-Istati Membri jistgħu japplikaw kriterji oħra barra dak ta’ l-ewwel okkupazzjoni, bħalma huwa l-perijodu ta’ żmien bejn id-data tat-tlestija tal-bini u d-data ta’ l-ewwel provvista, jew il-perijodu bejn id-data ta’ l-ewwel okkupazzjoni u d-data tal-provvista sussegwenti, sakemm dawk il-perijodi ma jaqbżux il–ħames snin u s-sentejn rispettivament.
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3. For the purposes of paragraph 1(b), “building land” shall mean any unimproved or improved land defined as such by the Member States.’
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3. Għall-finijiet tal-paragrafu 1(b), ‘art għall-bini’ għandha tfisser kull art mhux żviluppata jew art żviluppata meqjusa bħala tali mill-Istati Membri.”
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6. Article 73 of the directive provides that ‘[i]n respect of the supply of goods or services, other than as referred to in Articles 74 to 77, the taxable amount shall include everything which constitutes consideration obtained or to be obtained by the supplier, in return for the supply, from the customer or a third party, including subsidies directly linked to the price of the supply’.
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6. L-Artikolu 73 tad-Direttiva VAT jipprovdi li “[f]ir-rigward tal-provvista ta’ merkanzija jew servizzi, minbarra kif imsemmi fl-Artikoli 74 sa 77, l-ammont taxxabbli għandu jinkludi dak kollu li jikkostitwixxi ħlas miksub jew li għandu jinkiseb mill-fornitur, għall-provvista, mill-konsumatur jew parti terza, inklużi s-sussidji marbuta direttament mal-prezz tal-provvista”.
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7. Article 80 of the directive provides:
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7. L-Artikolu 80 tal-imsemmija direttiva jipprovdi li:
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‘1. In order to prevent tax evasion or avoidance, Member States may in any of the following cases take measures to ensure that, in respect of the supply of goods or services involving family or other close personal ties, management, ownership, membership, financial or legal ties as defined by the Member State, the taxable amount is to be the open market value:
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“1. Sabiex jimpedixxu l-evażjoni jew l-evitar tat-taxxa, l-Istati Membri jistgħu fil-każijiet li ġejjin jieħdu miżuri sabiex, fir-rigward tal-forniment [provvista] ta’ merkanzija jew servizzi li jinvolvu rabtiet ta’ familja jew rabtiet oħra personali qrib, rabtiet ta’ ġestjoni, appartenenza, sħubija, finanzjarji jew legali kif definit mill-Istat Membru, l-ammont taxxabbli għandu jkun il-valur tas-suq miftuħ:
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(a) where the consideration is lower than the open market value and the recipient of the supply does not have a full right of deduction under Articles 167 to 171 and Articles 173 to 177;
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(a) fejn il-konsiderazzjoni [korrispettiv] tkun aktar baxxa mill-valur tas-suq miftuħ u d-destinatarju tal-forniment ma jkollux dritt sħiħ għal tnaqqis taħt l-Artikoli 167 sa 171 u l-Artikoli 173 sa 177;
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(b) where the consideration is lower than the open market value and the supplier does not have a full right of deduction under Articles 167 to 171 and Articles 173 to 177 and the supply is subject to an exemption under Articles 132, 135, 136, 371, 375, 376, 377, 378(2), 379(2) or Articles 380 to 390;
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(b) fejn il-konsiderazzjoni tkun aktar baxxa mill-valur tas-suq miftuħ u l-fornitur ma jkollux dritt sħiħ għal tnaqqis taħt l-Artikoli 167 sa 171 u l-Artikoli 173 sa 177 u l-forniment ikun soġġett għal eżenzjoni taħt l-Artikoli 132, 135, 136, 371, 375, 376, 377, 378(2), 379(2) jew l-Artikoli 380 sa 390;
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(c) where the consideration is higher than the open market value and the supplier does not have a full right of deduction under Articles 167 to 171 and Articles 173 to 177.
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(ċ) fejn il-konsiderazzjoni tkun ogħla mill-valur tas-suq miftuħ u l-fornitur ma jkollux dritt sħiħ għal tnaqqis taħt l-Artikoli 167 sa 171 u l-Artikoli 173 sa 177.
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For the purposes of the first subparagraph, legal ties may include the relationship between an employer and employee or the employee’s family, or any other closely connected persons.
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Għall-finijiet ta’ l-ewwel subparagrafu, rabtiet legali jistgħu jinkludu r-relazzjoni bejn min iħaddem u l-impjegat jew il-familja ta’ l-impjegat, jew kwalunkwe persuna oħra konnessa mill-qrib.
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2. Where Member States exercise the option provided for in paragraph 1, they may restrict the categories of suppliers or recipients to whom the measures shall apply.
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2. Meta jużaw l-għażla prevista fil-paragrafu 1, l-Istati Membri jistgħu jispeċifikaw il-provvisti ta’ oġġetti u servizzi koperti, u l-kategoriji ta’ fornituri, prestaturi jew konsumaturi li għalihom jistgħu japplikaw dawn il-miżuri.
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3. Member States shall inform the VAT Committee of national legislative measures adopted pursuant to paragraph 1 in so far as these are not measures authorised by the Council prior to 13 August 2006 in accordance with Article 27(1) to (4) of Directive 77/388/EEC, and which are continued under paragraph 1 of this Article.’
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3. L-Istati Membri għandhom jinformaw lill-Kumitat tal-VAT dwar il-miżuri tal-liġi nazzjonali adottati f’ applikazzjoni tal-paragrafu 1 safejn dawn ma jkunux miżuri li ġew awtorizzati mill-Kunsill qabel it‑13 ta’ Awwissu 2006 skond l-Artikolu 27 (1) sa (4) tad-Direttiva 77/388/KE u li tkomplew skond dan il-paragrafu 1”.
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8. In accordance with Article 135(1)(j) and (k) of the directive, Member States are to exempt the following transactions:
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8. Skont l-Artikolu 135(1)(j) u (k) tad-Direttiva VAT, l-Istati Membri għandhom jeżentaw l-operazzjonijiet li ġejjin:
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‘(j) the supply of a building or parts thereof, and of the land on which it stands, other than the supply referred to in point (a) of Article 12(1);
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“(j) il-provvista ta’ bini jew partijiet minnu, u ta’ l-art li fuqha hija tinsab, ħlief il-provvista msemmija fil-punt (a) ta’ l-Artikolu 12(1);
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(k) the supply of land which has not been built on other than the supply of building land as referred to in point (b) of Article 12(1)’.
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(k) il-provvista ta’ art li ma nbnietx ħlief il-provvista ta’ art tal-bini kif imsemmi fil-punt (b) ta’ l-Artikolu 12(1)”.
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9. Article 273 of the directive provides:
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9. L-Artikolu 273 tal-imsemmija direttiva jipprovdi li:
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‘Member States may impose other obligations which they deem necessary to ensure the correct collection of VAT and to prevent evasion, subject to the requirement of equal treatment as between domestic transactions and transactions carried out between Member States by taxable persons and provided that such obligations do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers.
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“L-Istati Membri jistgħu jimponu obbligi oħrajn li jidhrulhom meħtieġa biex jiżguraw il-ġbir korrett ta’ VAT u biex ma ssirx frodi, soġġett għall-ħtieġa ta’ trattament indaqs bejn transazzjonijiet domestiċi u transazzjonijiet li jsiru bejn Stati Membri minn persuni taxxabbli u sakemm dawn l-obbligi, fin-negozju bejn Stati Membri, ma jagħtux lok għal formalitajiet konnessi mal-qsim ta’ fruntieri.
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The option under the first paragraph may not be relied upon in order to impose additional invoicing obligations over and above those laid down in Chapter 3.’
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L-għażla skond l-ewwel paragrafu ma tistax tintuża biex timponi obbligi tal-fatturazzjoni addizzjonali aktar minn dawk stabbiliti fil-Kapitolu 3.”
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National law
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Id-dritt nazzjonali
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10. Article 12(1) of the Law on value added tax (Zakon za danak varhu dobavenata stoynost, DV No 63, 4 August 2006, ‘the ZDDS’) provides:
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10. L-Artikolu 12(1) tal-liġi dwar it-taxxa fuq il-valur miżjud (Zakon za danak varhu dobavenata stoynost, DV Nru 63, tal-4 ta’ Awwissu 2006, iktar ’il quddiem iz-“ZDDS”) jipprovdi li:
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‘Any supply of goods or services within the meaning of Articles 6 and 9, where it is effected by a person taxable under the present law and where the place of performance is on national territory, and any supply taxed at zero rate and effected by a taxable person, unless the present law provides otherwise, is a taxable supply’.
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“Kull kunsinna ta’ oġġetti jew provvista ta’ servizzi fis-sens tal-Artikoli 6 u 9 meta sseħħ minn persuna taxxabbli skont din il-liġi u meta l-post ta’ eżekuzzjoni tagħha jinsab fit-territorju nazzjonali, kif ukoll kull operazzjoni suġġetta għar-rata żero mwettqa minn persuna taxxabbli, ħlief fil-każijiet fejn din il-liġi tipprovdi mod ieħor, tikkostitwixxi operazzjoni taxxabbli”.
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11. Article 27(3)(1) of the ZDDS provides that, in the case of a supply between connected persons, the taxable amount is the open market value.
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11. Il-punt 1 tal-Artikolu 27(3) taz-ZDDS jipprovdi li għal kull kunsinna bejn persuni konnessi, l-ammont taxxabli huwa l-valur fis-suq miftuħ.
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12. Under Article 45(1) of the ZDDS, ‘the transfer of ownership of land, the grant or transfer of limited rights in rem over land, and the leasing of land are exempt supplies’.
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12. Skont l-Artikolu 45(1) taz-ZDDS, “it-trasferiment tad-dritt għal proprjetà fuq art, il-kostituzzjoni jew it-trasferiment ta’ drittijiet reali limitati fuq art, kif ukoll il-kiri tagħha jikkostitwixxu operazzjonijiet eżenti”.
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13. Paragraph 5(2) of that article states that ‘paragraph 1 does not apply to the transfer of ownership of or other rights in rem in, or to the leasing of, equipment, machines, installations or structures which are firmly attached to the ground or constructed underground’.
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13. L-Artikolu 45(5) jippreċiża fil-punt 2 tiegħu li “l-Artikolu 45(1) la japplika għat-trasferiment ta’ dritt għal proprjetà jew ta’ drittijiet oħra reali u lanqas għall-kiri ta’ tagħmir, makkinarju, installazzjonijiet jew kostruzzjonijiet li huma fissi mal-art jew installati taħt l-art”.
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14. Article 67(1) of the ZDDS provides that ‘the amount of tax is calculated by multiplying the taxable amount by the tax rate’.
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14. L-Artikolu 67(1) taz-ZDDS jipprovdi li “l-ammont tat-taxxa għandu jiġi ddeterminat billi l-ammont taxxabbli jiġi mmultipplikat bir-rata tat-taxxa”.
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15. Under Article 70(5) of the ZDDS, ‘no right to deduct a tax credit arises from tax invoiced unlawfully’.
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15. Skont l-Artikolu 70(5) taz-ZDDS, “taxxa ffatturata b’mod illegali ma tagħtix dritt għal kreditu ta’ taxxa”.
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16. Paragraph 1(3) of the additional provisions of the Code of tax and social security procedure (Danachno-osiguritelnia protsesualen kodeks, DV No 105, 29 December 2005) specifies that ‘connected persons’ are:
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16. Il-paragrafu 1(3) tad-dispożizzjonijiet addizzjonali tal-Kodiċi tal-proċeduri dwar it-taxxa u tas-sigurtà soċjali (Danachno-osiguritelnia protsesualen kodeks, DV Nru 105, tad-29 ta’ Diċembru 2005) jippreċiża li “persuni konnessi” tfisser:
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‘(a) spouses, relatives in the direct line, relatives in the collateral line to the third degree; relatives by marriage to the second degree, and, for the purposes of Article 123(1)(2), where they form part of a common household;
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“a) il-konjuġi, il-qraba fil-linja diretta, il-qraba fil-linja kollaterali – sat-tielet grad, liema grad huwa inkluż u l-qraba permezz taż-żwieġ – sat-tieni grad, liema grad huwa inkluż – u, għall-finijiet tal-punt 2 tal-Artikolu 123(1), meta dawn jgħixu fir-residenza tal-familja;
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(b) employers and employees;
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b) min iħaddem u l-impjegat;
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(c) partners;
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ċ) l-assoċjati;
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(d) persons one of whom participates in the management of the other or its subsidiary;
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d) il-persuni li waħda fosthom tipparteċipa fit-tmexxija tal-oħra jew tas-sussidjarja tagħha;
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(e) persons in whose management or supervisory bodies one and the same legal or natural person takes part, including where the natural person represents another person;
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e) il-persuni fil-korp ta’ tmexxija jew ta’ kontroll li fihom tipparteċipa waħda u l-istess persuna, inkluż meta l-persuna fiżika tirrappreżenta persuna oħra;
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(f) a company and a person who is in possession of more than 5% of the holdings or shares with voting rights in the company;
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f) il-kumpannija u l-persuna li għandha iktar minn 5 % tal-ishma jew azzjonijiet li jagħtu dritt għal vot fil-kumpannija;
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(g) persons one of whom exercises control over the other;
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g) il-persuni li waħda fosthom teżerċita kontroll fuq l-oħra;
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(h) persons whose activity is controlled by a third person or by its subsidiary;
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h) il-persuni li l-attività tagħhom hija kkontrollata minn persuna terza jew is-sussidjarja tagħha;
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(i) persons who jointly control a third party or its subsidiary;
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i) il-persuni li flimkien jikkontrollaw persuna terza jew is-sussidjarja tagħha;
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(j) persons one of whom is a commercial agent of the other;
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j) il-persuni li waħda fosthom hija l-aġent kummerċjali tal-oħra;
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(k) persons one of whom has made a donation to the other;
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k) il-persuni li waħda fosthom għamlet donazzjoni lill-oħra;
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(l) persons who directly or indirectly participate in the management, supervision or share capital of another person or persons, as a result of which conditions can be agreed between them which deviate from the normal conditions.’
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l) il-persuni li jipparteċipaw direttament jew indirettament fit-tmexxija, fil-kontroll jew fil-kapital ta’ persuna jew diversi persuni oħrajn, u dan jippermettilhom li jiftehmu kudizzjonijiet differenti mill-kundizzjonijiet abitwali.”
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17. Under Paragraph 1(4) of the additional provisions, there is ‘control’ where the person controlling:
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17. Skont il-paragrafu 1(4) tal-imsemmija dispożizzjonijiet addizzjonali, ikun hemm “kontroll” meta l-persuna li tikkontrolla:
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‘(a) directly or indirectly or in combination with another person possesses more than half of the votes at the general assembly of another person, or
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“a) jkollha direttament jew indirettament jew permezz ta’ ftehim ma’ persuna oħra, iktar minn nofs il-voti fil-laqgħa ġenerali tal-persuna l-oħra; jew
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(b) has the possibility directly or indirectly of appointing more than half of the members of the management or supervisory body of another person, or
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b) ikollha l-possibbiltà li tiddetermina direttament jew indirettament iktar minn nofs il-membri tal-korp ta’ tmexxija jew ta’ kontroll ta’ persuna oħra; jew
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(c) has the possibility, including through or together with a subsidiary, on the basis of the articles of association or of a contract, of directing the activity of another person, or
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ċ) ikollha l-possibbiltà li tmexxi l-attività ta’ persuna oħra, inkluż permezz ta’ sussidjarja jew ma’ din tal-aħħar, skont l-istatut jew kuntratt; jew
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(d) as shareholder or partner in a company, on the basis of agreement with other partners or shareholders in the same company, independently controls more than half of the number of votes in the general meeting of that company, or
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d) bħala azzjonista jew membru f’kumpannija, tikkontrolla weħedha, permezz ta’ tranżazzjoni ma’ membri jew azzjonisti oħra ta’ din l-istess kumpannija, iktar min-nofs il-voti fil-laqgħa ġenerali tal-kumpannija; jew
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(e) in any other way can exercise a determining influence on decisions about the activity of the company’.
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e) tista’, b’mezz ieħor, teżerċita influwenza determinanti fuq id-deċiżjonijiet li jikkonċernaw l-attività tal-kumpannija.”
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The disputes in the main proceedings and the questions referred for a preliminary ruling
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Il-kawżi prinċipali u d-domandi preliminari
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Case C‑621/10
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Il-Kawża C‑621/10
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18. Balkan and Sea Properties is a share company whose activity is the investment of funds collected by issuing immovable property securities.
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18. Balkan and Sea Properties hija kumpannija b’responsabbiltà limitata li teżerċita attività ta’ investimenti ta’ fondi miġbura permezz tal-ħruġ ta’ titoli ta’ investiment relatati ma’ beni immobbli.
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19. In March 2009 Balkan and Sea Properties bought, by notarial acts, immovable property from the company Ravda tur EOOD, for a total amount of BGN 21 318 852. That company is owned by Holding Varna AD, which owns 27.98% of the share capital of Balkan and Sea Properties.
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19. Permezz ta’ atti notarili, f’Marzu 2009 Balkan and Sea Properties xtrat beni immobbli mingħand il-kumpannija Ravda tur EOOD għal ammont totali ta’ BGN 21 318 852. Din il-kumpannija hija miżmuma mil-Holding Varna AD, li hija stess iżżomm 27.98 % tal-kapital ta’ Balkan and Sea Properties.
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20. VAT was deducted on the conclusion of the definitive contract and the issue of the final invoices.
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20. Il-VAT tnaqqset meta ġie konkluż il-kuntratt definittiv u meta ġew stabbiliti l-fatturi finali.
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21. Since the national legislation provides that, in the event of a sale between connected persons, the taxable amount is the open market value of the property, two export reports were commissioned, one by Balkan and Sea Properties and one by the tax authorities. The authorities concluded that the open market value of the property was lower than the actual sale price, and estimated it at BGN 21 216 300.
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21. Peress li l-leġiżlazzjoni nazzjonali tipprovdi li, fil-każ ta’ bejgħ bejn persuni konnessi, l-ammont taxxabbli għandu jikkorrispondi għall-valur fis-suq miftuħ tal-beni, intalbu li jsiru żewġ stimi, waħda minn Balkan and Sea Properties u l-oħra mid-dipartimenti tal-awtorità tat-taxxa. Din tal-aħħar ikkonkludiet li l-valur fis-suq miftuħ tal-beni kien inqas mill-prezz ta’ bejgħ reali tagħhom li huwa stmat għal BGN 21 216 300.
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22. The tax authorities thereupon considered that the VAT calculated on a price higher than the open market value of the property was unlawfully invoiced tax which could not be deducted and that, consequently, for the tax period corresponding to July 2009, Balkan and Sea Properties was not entitled to deduct the input VAT on the difference between the open market value and the actual sale price of the property in question.
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22. Għaldaqstant, l-awtorità tat-taxxa kkunsidrat li l-VAT ikkalkolata fuq prezz ogħla mill-valur fis-suq miftuħ tal-beni kienet tikkostitwixxi taxxa ffatturata b’mod illegali li ma tistax titnaqqas u, konsegwentement, li għall-perijodu ta’ tassazzjoni relatat max-xahar ta’ Lulju 2009, Balkan and Sea Properties ma kellhiex id-dritt li tnaqqas il-VAT tal-input imħallsa fuq id-differenza bejn dan il-valur tas-suq miftuħ u l-prezz ta’ bejgħ reali tal-beni inkwistjoni.
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23. The amended tax notice was challenged in administrative proceedings before the Director. The Director confirmed the refusal of deduction of VAT.
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23. L-avviż ta’ rettifika tat-taxxa kien is-suġġett ta’ azzjoni amministrattiva quddiem id-Direktor. Dan tal-aħħar ikkonferma r-rifjut li l-VAT titnaqqas.
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24. Balkan and Sea Properties brought proceedings in the Administrativen sad Varna (Administrative Court, Varna).
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24. Balkan and Sea Properties adixxiet l-Administrativen sad Varna (il‑Qorti Amministrattiva ta’ Varna).
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25. That company submits in particular that the provisions of the ZDDS are not compatible with Article 80(1) of the VAT Directive, and seeks for that provision of European Union law to be applied directly.
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25. L-imsemmija kumpannija ssostni, b’mod partikolari, li d-dispożizzjonijiet taz-ZDDS ma humiex konformi mal-Artikolu 80(1) tad-Direttiva VAT u titlob l-applikazzjoni diretta ta’ din id-dispożizzjoni tad-dritt tal-Unjoni.
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26. In those circumstances, the Administrativen sad Varna decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:
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26. Huwa f’dan il-kuntest li l-Administrativen sad Varna ddeċidiet li tissospendi l-proċeduri quddiemha u li tagħmel lill-Qorti tal-Ġustizzja d-domandi preliminari li ġejjin:
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‘1. Is Article 80(1)(c) of [the VAT Directive] to be interpreted as meaning that, where there are supplies between connected persons, in so far as the consideration is higher than the open market value, the taxable amount is the open market value of the transaction only if the supplier does not qualify for the full right to deduct the tax credit on the purchase or production of the goods which are supplied?
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“1) L-Artikolu 80(1)(ċ) tad-Direttiva [VAT] għandu jiġi interpretat fis-sens li meta jkun hemm provvista bejn persuni relatati, sa fejn il-korrispettiv ikun ogħla mill-valur tas-suq miftuħ, l-ammont taxxabbli huwa l-valur tas-suq miftuħ tat-tranżazzjoni biss jekk il-fornitur ma għandux dritt għal tnaqqis tal-VAT kollha dovuta fuq ix-xiri/il-bejgħ tal-merkanzija li hija s-suġġett tal-provvista?
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2. Is Article 80(1)(c) of [the VAT Directive] to be interpreted as meaning that, if the supplier has exercised the full right to deduct the tax credit on goods and services which are the subject of subsequent supplies between connected persons at a price which is higher than the open market value, and that right to deduct the tax credit has not been corrected under Articles 173 to 177 of that directive, a Member State is not permitted to adopt measures whereby the taxable amount is exclusively the open market value?
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2) L-Artikolu 80(1)(ċ) tad-Direttiva [VAT] għandu jiġi interpretat fis-sens li meta fornitur ikun eżerċita d-dritt għal tnaqqis tal-VAT kollha dovuta fuq prodotti u servizzi li kienu s-suġġett ta’ provvista sussegwenti bejn persuni relatati bi prezz ogħla mill-valur tas-suq miftuħ u d-dritt għal tnaqqis ma kienx korrett skont l-Artikoli 173 sa 177 tad-Direttiva, Stat Membru ma jistax jadotta miżuri fejn l-ammont taxxabbli jkun esklużivament il-valur tas-suq miftuħ?
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3. Does Article 80(1) of [the VAT Directive] constitute an exhaustive list of cases representing the circumstances in which the Member States may take measures whereby the taxable amount in respect of supplies is to be the open market value of the transaction?
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3) L-Artikolu 80(1) tad-Direttiva [VAT] jikkostitwixxi lista eżawrjenti tal-każijiet li jirrappreżentaw iċ-ċirkustanzi li fihom l-Istati Membri jistgħu jieħdu miżuri fejn l-ammont taxxabbli fir-rigward ta’ provvisti jkun il-valur tas-suq miftuħ tat-tranżazzjoni?
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4. Is a provision of national law such as Article 27(3)(1) of the ZDDS permissible in cases other than those listed in Article 80(1)(a), (b) and (c) of [the VAT Directive]?
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4) Dispożizzjoni nazzjonali bħall-punt 1 tal-Artikolu 27(3) taz-ZDDS hija ammissibbli f’ċirkustanzi oħra minbarra dawk elenkati fl-Artikolu 80(1)(a), (b) u (ċ) tad-Direttiva [VAT]?
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5. In a case such as the present, does Article 80(1)(c) of [the VAT Directive] have direct effect, and may the national court apply it directly?’
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5) F’każ bħal dan inkwistjoni, id-dispożizzjoni tal-Artikolu 80(1)(ċ) tad-Direttiva [VAT] għandha effett dirett u l-qorti nazzjonli tista’ tapplikaha direttament?”
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Case C‑129/11
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Il-Kawża C‑129/11
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27. Provadinvest is a limited company whose principal activity is the leasing of agricultural land and steel structures used for polyethylene greenhouses.
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27. Provadinvest hija kumpannija b’responsabbiltà limitata li bħala attività prinċipali għandha l-kiri ta’ raba’ u ta’ kostruzzjonijiet tal-ħadid użati għas-serrer tal-polyethylene.
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28. In June 2009 that company sold, by notarial acts, two plots of land to be used for greenhouses to one of its partners and one plot to its representative. Those plots were sold with the polyethylene structures erected on them, and with all the improvements and permanent crops on them, at a price of BGN 25 000 each.
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28. Permezz ta’ atti notarili, f’Ġunju 2009, din il-kumpannija biegħet żewġ artijiet intiżi għall-użu ta’ serrer lill-wieħed mill-membri tagħha u art lir-rappreżentant tagħha. Dawn l-artijiet inbiegħu bil-kostruzzjonijiet tal-polyethylene li jinsabu fuqhom u bil-benefikati u l-prodotti permanenti li kienu jinsabu fihom, għall-prezz ta’ BGN 25 000 il-wieħed.
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29. Provadinvest issued invoices not indicating VAT for those sales.
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29. Provadinvest ħarġet fatturi mingħajr il-VAT għal dan il-bejgħ.
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30. The tax authorities took the view that the sales of the immovable property included both a supply of land that was exempt from VAT and a taxable supply of installations, improvements and permanent crops.
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30. L-awtorità tat-taxxa kkunsidrat li l-bejgħ tal-immobbli kien jinkludi kunsinna ta’ artijiet eżenti mill-VAT, iżda wkoll kunsinna taxxabbli ta’ installazzjonijiet, benefikati u ta’ prodotti permanenti.
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31. Under national legislation, as the sales in question were sales between connected persons, the taxable amount for VAT purposes was the open market value determined by an expert. The expert assessed the total open market value solely of the polyethylene structures on the three plots of land at BGN 392 700, a greater sum than that actually paid as consideration.
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31. Skont il-leġiżlazzjoni nazzjonali, sa fejn il-bejgħ inkwistjoni kien bejgħ bejn persuni konnessi, l-ammont taxxabbli għall-finijiet tal-VAT kien il-valur fis-suq miftuħ kif iffissat minn espert. L-istima tal-espert tal-valur fis-suq miftuħ globali tal-kostruzzjonijiet tal-polyethylene biss li jinsabu fuq l-artijiet kienet ta’ BGN 392 700, jiġifieri somma ogħla minn dik realment imħallsa bħala korrispettiv.
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32. The tax authorities issued an amended tax notice for the tax period corresponding to June 2009. That notice was challenged in administrative proceedings before the Director, who confirmed the amount of VAT charged to Provadinvest.
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32. L-awtorità tat-taxxa ħarġet avviż ta’ rettifika tat-taxxa għall-perijodu ta’ tassazzjoni relatat max-xahar ta’ Ġunju 2009. Dan tal-aħħar kien is-suġġett ta’ azzjoni amministrattiva quddiem id-Direktor, li kkonferma l-ammont tal-VAT impost fuq Provadinvest.
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33. Provadinvest brought proceedings in the Administrativen sad Varna.
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33. Provadinvest ippreżentat rikors quddiem l-Administrativen sad Varna.
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34. That court considers that the sale of the agricultural land in question represents an exempt supply under Article 45(1) of the ZDDS and that the sale of the installations erected on the land represents a taxable supply, as they fall within the exceptions mentioned in Article 45(5)(2) of that law.
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34. Il-qorti tar-rinviju tikkunsidra li l-bejgħ tar-raba’ inkwistjoni jirrappreżenta kunsinna eżenti taħt l-Artikolu 45(1) taz-ZDDS u li l-bejgħ tal-installazzjonijiet li jinsabu fuq dawn l-artijiet jirrappreżentaw kunsinna taxxabbli, peress li dawn jaqgħu taħt l-eċċezzjonijiet imsemmija fil-punt 2 tal-Artikolu 45(5).
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35. In those circumstances, the Administrativen sad Varna decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:
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35. F’dawn iċ-ċirkustanzi l-Administrativen sad Varna ddeċidiet li tissospendi l‑proċeduri u li tagħmel lill-Qorti tal-Ġustizzja d-domandi preliminari li ġejjin:
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‘1. Is Article 80(1)(a) and (b) of [the VAT Directive] to be interpreted as meaning that, where there are supplies between connected persons, in so far as the consideration is lower than the open market value, the taxable amount is the open market value of the transaction only if the supplier or the acquirer does not qualify for the full right to deduct the tax credit on the purchase or production of the goods which are supplied?
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“1) L-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT], għandu jiġi interpretat fis-sens li, fil-każ ta’ kunsinna bejn persuni relatati, meta l-korrispettiv ikun inqas mill-valur normali [valur fis-suq miftuħ], l-ammont taxxabli għandu jkun il-valur fis-suq miftuħ tat-tranżazzjoni biss meta l-fornitur u x-xerrej ma jkollhomx id-dritt għal tnaqqis sħiħ tal-VAT tal-input fuq ix-xiri u/jew il-ħolqien tal-merkanzija li tkun is-suġġett tal-kunsinna?
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2. Is Article 80(1)(a) and (b) of [the VAT Directive] to be interpreted as meaning that, if the supplier has exercised the full right to deduct the tax credit on goods and services which are the subject of subsequent supplies between connected persons at a value which is lower than the open market value, and that right to deduct the tax credit has not been corrected under Articles 173 to 177 of the directive and the supply is not subject to a tax exemption within the meaning of Articles 132, 135, 136, 371, 375, 376, 377, 378(2), 379(2) and 380 to 390 of the directive, a Member State is not permitted to adopt measures whereby the taxable amount is exclusively the open market value?
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2) L-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT], għandu jiġi interpretat fis-sens li, meta l-fornitur ikun eżerċita dritt għal tnaqqis tal-VAT tal-input kollha fuq il-merkanzija u fuq is-servizzi li jkunu s-suġġett ta’ kunsinna ulterjuri bejn persuni relatati b’valur inqas mill-valur fis-suq miftuħ, f’sitwazzjoni fejn dan id-dritt għal tnaqqis tal-VAT tal-input ma jkunx ġie kkoreġut skont l-Artikoli 173 sa 177 ta[’ din i]d-Direttiva u fejn il-kunsinna ma tkunx suġġetta għal eżenzjoni skont l-Artikoli 132, 135, 136, 371, 375, 376, 377, 378(2), 379(2) jew 380 sa 390 ta[’ l-imsemmija] Direttiva, l-Istat Membru ma jistax jieħu miżuri li jipprovdu li l-ammont taxxabbli għandu jkun biss il-valur normali?
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3. Is Article 80(1)(a) and (b) of [the VAT Directive] to be interpreted as meaning that, if the acquirer has exercised the full right to deduct the tax credit on goods and services which are the subject of subsequent supplies between connected persons at a lower value than the open market value, and that right to deduct the tax credit has not been corrected under Articles 173 to 177 of the directive, a Member State is not permitted to adopt measures whereby the taxable amount is exclusively the open market value?
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3) L-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT], għandu jiġi interpretat fis-sens li, meta x-xerrej ikun eżerċita dritt għal tnaqqis tal-VAT tal-input kollha fuq il-merkanzija u fuq is-servizzi li jkunu s-suġġett ta’ kunsinna ulterjuri bejn persuni relatati b’valur inqas mill-valur fis-suq miftuħ, f’sitwazzjoni fejn dan id-dritt għal tnaqqis tal-VAT tal-input ma jkunx ġie kkoreġut skont l-Artikoli 173 sa 177 tad-Direttiva, l-Istat Membru ma jistax jieħu miżuri li jipprovdu li l-ammont taxxabbli għandu jkun biss il-valur normali?
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4. Does Article 80(1) of [the VAT Directive] constitute an exhaustive list of cases representing the circumstances in which a Member State is permitted to take measures whereby the taxable amount in respect of supplies is to be the open market value of the transaction?
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4) L-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT], jelenka b’mod eżawrjenti l-każijiet li fihom huma sodisfatti l-kundizzjonijiet li jippermettu lil Stat Membru jieħu miżuri sabiex jiżgura li l-ammont taxxabbli jkun il-valur fis-suq [miftuħ] tat-tranżazzjoni?
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5. Is a provision of national law such as Article 27(3)(1) of the ZDDS permissible in cases other than those listed in Article 80(1)(a), (b) and (c) of [the VAT Directive]?
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5) Dispożizzjoni tad-dritt nazzjonali, bħal dik li tinsab fil-punt 1 tal-Artikolu 27(3) taz-ZDDS, hija ammissibbli f’sitwazzjonijiet oħra li jkunu differenti minn dawk elenkati fl-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT]?
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5. In a case such as the present, does Article 80(1)(a) and (b) of [the VAT Directive] have direct effect, and may the national court apply it directly?’
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6) F’każ bħal dak ineżami, id-dispożizzjoni tal-Artikolu 80(1)(a) u (b) tad-Direttiva [VAT], għandha effett dirett u l-qorti nazzjonali tista’ tapplikaha direttament?”
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36. By order of the President of the Court of 13 July 2011, Cases C‑621/10 and C‑129/11 were joined for the purposes of the oral procedure and the judgment.
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36. Permezz ta’ digriet tal-President tal-Qorti tal-Ġustizzja tat-13 ta’ Lulju 2011, iż-żewġ kawżi C‑621/10 u C‑129/11 ġew magħquda għall-finijiet tal-proċedura orali u tas-sentenza.
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Consideration of the questions referred
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Fuq id-domandi preliminari
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Preliminary observations
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Osservazzjonijiet preliminari
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37. In Case C‑129/11 the referring court considers it necessary, in order to decide on the lawfulness of the amended tax notice which is the subject of the main proceedings, to determine, as well as the amount of the tax due, whether the conditions were satisfied for subjecting the sales of agricultural land and the installations erected on the land to VAT.
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37. Fil-Kawża C‑129/11, il-qorti tar-rinviju tikkunsidra li, sabiex tiddeċiedi dwar il-legalità tal-avviż ta’ rettifika tat-taxxa li huwa s-suġġett tal-kawża prinċipali, huwa neċessarju li apparti l-ammont tat-taxxa dovut, jiġi ddeterminat jekk il-kundizzjonijiet, meħtieġa sabiex il-bejgħ tar-raba’ u tal-installazzjonijiet li jinsabu fuqhom jiġu suġġetti għall-VAT, kinux sodisfatti.
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38. For that purpose, it must be assessed whether the supplies of structures, namely polyethylene greenhouses, and the land on which they stand at issue in that case are exempt under Article 135 of the VAT Directive. The answer to that question depends on whether those structures may be classified as ‘buildings’ within the meaning of the first subparagraph of Article 12(2) of that directive.
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38. Għal dak il-għan, għandu jiġi evalwat jekk il-kunsinni tal-kostruzzjonijiet, jiġifieri tas-serrer tal-polyethylene, u tal-art relatata magħhom, inkwistjoni f’din il-kawża, humiex eżenti taħt l-Artikolu 135 tad-Direttiva VAT. Ir-risposta għal din id-domanda tiddependi mill-punt dwar jekk il-kostruzzjonijiet jistgħux jiġu kklassifikati bħala “bini” fis-sens tal-ewwel paragrafu tal-Artikolu 12(2) tal-istess direttiva.
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39. If so, if the supplies of those goods may be regarded as taking place before first occupation, there is a taxable transaction, whereas in the opposite case the transaction must be exempt in accordance with Article 135(1)(j) of the VAT Directive, subject to a possible right to opt for taxation.
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39. Fil-każ li r-risposta hija pożittiva, jekk il-kunsinni tal-imsemmija oġġetti jistgħu jitiqiesu bħala preċedenti għall-ewwel okkupazzjoni, dawn ikunu operazzjoni taxxabbli, filwaqt li, fil-każ oppost l-operazzjoni għandha tiġi eżenti taħt l-Artikolu 135(1)(j) ta’ din id-direttiva bla ħsara għall-possibbiltà ta’ dritt ta’ għażla għal tassazzjoni.
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40. If those structures and the ground on which they stand cannot be classified as ‘buildings’ within the meaning of the first subparagraph of Article 12(2) of the VAT Directive, a distinction must be drawn depending on whether there are distinct supplies of land and of other elements or one single transaction consisting primarily of the supply of land (see, to that effect, Case C‑461/08 Don Bosco Onroerend Goed [2009] ECR I‑11079, paragraphs 35 to 38). It should also be ascertained whether the land in question falls within the definition of ‘building land’ in Article 12(3) of the VAT Directive. If so, the supplies would be taxable. If not, the supplies would be exempt in accordance with Article 135(1)(k) of the directive, subject to a possible right to opt for taxation.
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40. Jekk l-imsemmija kostruzzjonijiet u l-art relatata magħhom ma jistgħux jiġu kklassifikati bħala bini fis-sens tal-ewwel paragrafu tal-Artikolu 12(2) tad-Direttiva VAT, għandha ssir distinzjoni bejn jekk humiex kunsinni distinti ta’ artijiet u ta’ elementi oħrajn jew operazzjoni unika komposta prinċipalment mill-kunsinna ta’ artijiet (ara, f’dan is-sens, is-sentenza tad-19 ta’ Novembru 2009, Don Bosco Onroerend Goed, C‑461/08, Ġabra p. I‑11079, punti 35 sa 38). Barra minn hekk, huwa importanti li jiġi vverifikat jekk l-artijiet inkwistjoni jaqgħux taħt il-kunċett ta’ “art għall-bini” fis-sens tal-Artikolu 12(3) tad-Direttiva VAT. Jekk dan ikun il-każ, il-kunsinni huma taxxabbli. Fil-każ oppost, il-kunsinni huma eżenti taħt l-Artikolu 135(1)(k) tal-imsemmija direttiva, bla ħsara għall-possibbiltà ta’ dritt ta’ għażla għal tassazzjoni.
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41. Such assessments of fact are within the jurisdiction of the referring court in the procedure established in Article 267 TFEU (see, to that effect, Case 104/77 Oehlschläger [1978] ECR 791, paragraph 4; Case C‑30/93 AC-ATEL Electronics Vertriebs [1994] ECR I‑2305, paragraphs 16 and 17; and Case C‑318/98 Fornasar and Others [2000] ECR I‑4785, paragraphs 31 and 32).
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41. Tali evalwazzjonijiet ta’ fatt jaqgħu taħt il-kompetenza tal-qorti tar-rinviju fil-kuntest tal-proċedura stabbilita fl-Artikolu 267 TFUE (ara, f’dan is-sens, is-sentenzi tas-16 ta’ Marzu 1978, Oehlschläger, 104/77, Ġabra p. 791, punt 4; tat-2 ta’ Ġunju 1994, AC-ATEL Electronics Vertriebs, C‑30/93, Ġabra p. I‑2305, punti 16 u 17, kif ukoll tat-22 ta’ Ġunju 2000, Fornasar et , C‑318/98, Ġabra p. I‑4785, punti 31 u 32).
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Questions 1 to 4 in Case C‑621/10 and Questions 1 to 5 in Case C‑129/11
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Fuq l-ewwel sar-raba’ domanda fil-Kawża C‑621/10 u l-ewwel sal-ħames domanda fil-Kawża C‑129/11
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42. By these questions, which should be considered together, the referring court essentially asks whether Article 80(1) of the VAT Directive must be interpreted as meaning that the conditions it states are exhaustive or whether it may be accepted that the taxable amount is the open market value of the transaction between connected persons in cases other than those expressly provided for in that provision, in particular where the taxable person has a full right of deduction.
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42. Permezz ta’ dawn id-domandi, li għandhom jiġu eżaminati flimkien, il-qorti tar-rinviju essenzjalment tistaqsi jekk l-Artikolu 80(1) tad-Direttiva VAT għandux jiġi interpretat fis-sens li l-kundizzjonijiet imsemmija fih huma eżawrjenti jew jekk jistax jiġi aċċettat li l-ammont taxxabbli huwa l-valur fis-suq miftuħ tal-operazzjoni bejn persuni konnessi f’każijiet oħra li huma differenti minn dawk espressament previsti f’din id-dispożizzjoni, b’mod partikolari, meta l-persuna taxxabbli jkollha dritt għal tnaqqis sħiħ.
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43. In accordance with the general rule set out in Article 73 of the VAT Directive, the taxable amount for the supply of goods or services for consideration is the consideration actually received for them by the taxable person. That consideration is thus the subjective value, that is to say, the value actually received, and not a value estimated according to objective criteria (see, to that effect, Case 154/80 Coöperatieve Aardappelenbewaarplaats [1981] ECR 445, paragraph 13; Case C‑412/03 Hotel Scandic Gåsabäck [2005] ECR I‑743, paragraph 21; and Case C‑285/10 Campsa Estaciones de Servicio [2011] ECR I‑0000, paragraph 28).
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43. Skont ir-regola ġenerali msemmija fl-Artikolu 73 tad-Direttiva VAT, l-ammont taxxabbli fir-rigward tal-kunsinna ta’ oġġett jew tal-provvista ta’ servizz, magħmula bi ħlas, huwa kkostitwit mill-korrispettiv li fir-realtà tirċievi l-persuna taxxabbli f’dan ir-rigward. Dan il-korrispettiv jikkostitwixxi l-valur suġġettiv, jiġifieri dak li fir-realtà tirċievi l-persuna taxxabbli, u mhux valur stmat skont kriterji oġġettivi (ara, f’dan is-sens, is-sentenzi tal-5 ta’ Frar 1981, Coöperatieve Aardappelenbewaarplaats, 154/80, Ġabra p. 445, punt 13; tal-20 ta’ Jannar 2005, Hotel Scandic Gåsabäck, C‑412/03, Ġabra p. I‑743, punt 21, u tad-9 ta’Ġunju 2011, Campsa Estaciones de Servicio, C‑285/10, li għandha ma ġietx ippubblikata fil-Ġabra, punt 28).
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44. Article 73 of the VAT Directive is the expression of a fundamental principle, the corollary of which is that the tax authorities may not collect as VAT an amount exceeding the tax paid to the taxable person (see, to that effect, Case C‑330/95 Goldsmiths [1997] ECR I‑3801, paragraph 15).
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44. L-Artikolu 73 tal-imsemmija direttiva huwa l-espressjoni ta’ prinċipju fundamentali li l-korollarju tiegħu huwa li l-awtorità tat-taxxa ma tistax tiġbor bħala VAT ammont li jkun superjuri għal dak miġbur mill-persuna taxxabbli (ara, f’dan is-sens, is-sentenza tat-3 ta’ Lulju 1997, Goldsmiths, C‑330/95, Ġabra p. I‑3801, punt 15).
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45. By allowing the taxable amount to be taken as the open market value of the transaction in certain cases, Article 80(1) of the VAT Directive lays down an exception to the general rule stated in Article 73 of the directive, which must as such be interpreted strictly (see Case C‑453/05 Ludwig [2007] ECR I‑5083, paragraph 21, and Case C‑41/09 Commission v Netherlands [2011] ECR I‑0000, paragraph 58 and the case-law cited).
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45. Billi f’ċerti każijiet jippermetti li jitqies li l-ammont taxxabbli huwa l-valur fis-suq miftuħ, l-Artikolu 80(1) tad-Direttiva VAT jistabbilixxi eċċezzjoni għar-regola ġenerali prevista fl-Artikolu 73 tagħha li, bħala tali, għandha tiġi interpretata b’mod strett (ara s-sentenzi tal-21 ta’ Ġunju 2007, Ludwig, C‑453/05, Ġabra p. I‑5083, punt 21, kif ukoll tat-3 ta’ Marzu 2011, Il-Kummissjoni vs Il-Pajjiżi l-Baxxi, C‑41/09, li għadha ma ġietx ippubblikata fil-Ġabra, punt 58 u l-ġurisprudenza ċċitata).
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46. It should be recalled that, as stated in recital 26 in the preamble to the VAT Directive, the objective of Article 80(1) is to prevent tax evasion or avoidance.
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46. Għandu jitfakkar li skont it-termini tal-premessa 26 tad-Direttiva VAT, l-Artikolu 80(1) tagħha għandu l-għan li jiġu evitati l-frodi jew l-evażjoni fiskali.
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47. As the Advocate General observes in point 30 of her Opinion, where goods or services are supplied at an artificially low or high price between parties who both enjoy a full right of deduction of VAT, there cannot be any evasion or avoidance of tax at that stage. It is only at the stage of the final consumer, or of a mixed taxable person enjoying only a proportional right of deduction, that an artificially low or high price can lead to a loss of tax revenue.
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47. Madankollu, hekk kif irrilevat l-Avukat Ġenerali fil-punt 30 tal-konklużjonijiet tagħha, meta l-oġġetti jew servizzi huma pprovduti għal prezz artifiċjalment baxx jew għoli bejn persuni li, t-tnejn li huma għandhom dritt li jnaqqsu il-VAT b’mod sħiħ, ma jistax ikun hemm frodi jew evażjoni fiskali f’dan l-istadju. Huwa biss mal-livell tal-konsumatur finali jew fil-każ ta’ persuna taxxabbli mħallta li għandha biss dritt għal tnaqqis proporzjonat, li prezz artifiċjalment baxx jew għoli jista’ jwassal għal telf fid-dħul mit-taxxa.
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48. Consequently, it is only where the person concerned by the transaction does not enjoy a full right of deduction that there is a risk of tax evasion or avoidance which Article 80(1) of the directive allows the Member States to prevent.
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48. Għaldaqstant, huwa biss meta l-persuna kkonċernata mill-operazzjoni ma tibbenefikax minn dritt għal tanqqis sħiħ li jeżisti riskju ta’ frodi jew evażjoni fiskali, li l-Istati Membri jistgħu jipprevjenu skont l-Artikolu 80(1) ta’ din id-direttiva.
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49. That conclusion does not in any way prevent the Member States from laying down other obligations in order to avoid evasion, on the basis of and in compliance with the conditions set out in Article 273 of the VAT Directive.
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49. Tali konstatazzjoni ma tippreġudika bl-ebda mod il-possibbiltà għall-Istati Membri li jipprevedu obbligi oħrajn sabiex jiġu evitati l-frodi fuq il-bażi u fl-osservanza tal-kundizzjonijiet previsti fl-Artikolu 273 tad-Direttiva VAT.
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50. That interpretation is confirmed by the wording of Article 11(A)(6) of the Sixth Directive 77/388, as amended by Council Directive 2006/69/EC of 24 July 2006 (OJ 2006 L 221, p. 9), the provisions of which are substantially reproduced in Article 80(1) of the VAT Directive (see recital 3 in the preamble to that directive), and which states that the derogation ‘may apply only in any of the following circumstances’.
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50. Din l-interpretazzjoni hija kkorraborata mill-formulazzjoni tal-Artikolu 11(A)(6) tas-Sitt Direttiva 77/388 kif emendata bid-Direttiva tal-Kunsill 2006/69/KE, tal-24 ta’ Lulju 2006 (ĠU L 76M, p. 232), li d-dispożizzjonijiet tiegħu huma essenzjalment riprodotti fl-Artikolu 80(1) tad-Direttiva VAT (ara l-premessa 3 tagħha), li tipprovdi li d-deroga prevista “tista’ tapplika biss f’waħda miċ-ċirkostanzi li ġejjin”.
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51. It follows from the foregoing that the conditions of application laid down in Article 80(1) of the VAT Directive are exhaustive and, consequently, that national legislation cannot on the basis of that provision provide that the taxable amount is to be the open market value of the transaction in cases other than those listed in that provision, in particular where the supplier or acquirer has a full right of deduction of VAT.
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51. Minn dak li ntqal jirriżulta li l-kundizzjonijet għall-applikazzjoni stabbiliti fl-Artikolu 80(1) tad-Direttiva VAT huma eżawrjenti u, għaldaqstant, leġiżlazzjoni nazzjonali ma tistax tipprevedi, abbażi ta’ din id-dispożizzjoni, li l-ammont taxxabbli huwa l-valur fis-suq miftuħ tal-operazzjoni f’każijiet li huma differenti minn dawk elenkati fl-imsemmija dispożizzjoni, b’mod partikolari, meta l-fornitur jew ix-xerrej għandu d-dritt li jnaqqas il-VAT b’mod sħiħ.
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52. The answer to Questions 1 to 4 in Case C‑621/10 and Questions 1 to 5 in Case C‑129/11 is therefore that Article 80(1) of the VAT Directive must be interpreted as meaning that the conditions of application it sets out are exhaustive and, consequently, that national legislation cannot on the basis of that provision provide that the taxable amount is to be the open market value of the transaction in cases other than those listed in that provision, in particular where the taxable person has a full right of deduction of VAT, which is for the national court to ascertain.
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52. Konsegwentement, ir-risposta għall-ewwel sar-raba’ domanda fil-Kawża C‑621/10 u għall-ewwel sal-ħames domanda fil-Kawża C‑129/11 għandha tkun li l-Artikolu 80(1) tad-Direttiva VAT għandu jiġi interpretat fis-sens li l-kundizzjonijiet għall-applikazzjoni li huwa jsemmi huma eżawrjenti u li, għaldaqstant, leġiżlazzjoni nazzjonali ma tistax tipprevedi, abbażi ta’ din id-dispożizzjoni, li l-ammont taxxabbli huwa l-valur fis-suq miftuħ tal-operazzjoni f’każijiet li huma differenti minn dawk elenkati fl-imsemmija dispożizzjoni, b’mod partikolari, meta l-persuna taxxabbli jkollha d-dritt li tnaqqas il-VAT b’mod sħiħ, u dan għandu jiġi vverifikat mill-qorti nazzjonali.
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Question 5 in Case C‑621/10 and Question 6 in Case C‑129/11
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Fuq il-ħames domanda fil-Kawża C‑621/10 u s-sitt domanda fil-Kawża C‑129/11
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53. By these questions the referring court essentially asks whether Article 80(1) of the VAT Directive has direct effect and whether the national court can consequently apply it directly to the disputes in the main proceedings.
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53. Permezz ta’ dawn id-domandi, il-qorti tar-rinviju essenzjalment tistaqsi jekk l-Artikolu 80(1) tad-Direttiva VAT għandux effett dirett u jekk il-qorti nazzjonali tistax, konsegwentement, tapplikah direttament għall-kawżi prinċipali.
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54. It is for the referring court, to the full extent of its discretion under national law, to interpret and apply national law in conformity with the requirements of European Union law and, where such an interpretation is not possible, to disapply any provision of domestic law that would be contrary to those requirements (see, to that effect, Case C‑357/06 Frigerio Luigi & C. [2007] ECR I‑12311, paragraph 28, and Joined Cases C‑395/08 and C‑396/08 Bruno and Others [2010] ECR I‑5119, paragraph 74).
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54. Huwa l-obbligu tal-qorti nazzjonali li, sa fejn id-dritt nazzjonali jatiha marġini ta’ diskrezzjoni, tinterpreta u tapplika dispożizzjoni tad-dritt nazzjonali b’mod konformi mar-rekwiżiti tad-dritt tal-Unjoni u, jekk tali interpretazzjoni konformi ma tkunx possibbli, li ma tapplikax kull dispożizzjoni tad-dritt nazzjonali li tmur kontra dawn ir-rekwiżiti (ara, f’dan is-sens, is-sentenzi tat-18 ta’ Diċembri 2007, Frigerio Luigi & C., C‑357/06, Ġabra p. I‑12311, punt 28, kif ukoll tal-10 ta’ Ġunju 2010, Bruno et ., C‑395/08 u C‑396/08, Ġabra p. I‑5119, punt 74).
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55. As found in paragraphs 42 to 51 above, Article 80(1) of the VAT Directive allows exceptions to be made to the general rule laid down in Article 73 of that directive only in the cases it lists.
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55. Kif ġie kkonstatat fil-punti 42 sa 51 ta’ din is-sentenza, l-Artikolu 80(1) tad-Direttiva VAT jippermetti li ssir deroga mir-regola ġenerali stabbilita fl-Artikolu 73 ta’ din id-direttiva fil-każijiet elenkati fih biss.
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56. According to settled case-law of the Court, whenever the provisions of a directive appear, so far as their subject-matter is concerned, to be unconditional and sufficiently precise, they may be relied on before the national courts by individuals against the State where the State has failed to transpose the directive into national law within the time-limit or has transposed it incorrectly (see Case C‑226/07 Flughafen Köln-Bonn [2008] ECR I‑5999, paragraph 23, and Case C‑203/10 Auto Nikolovi [2011] ECR I‑0000, paragraph 61).
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56. Skont ġurisprudenza stabbilita tal-Qorti tal-Ġustizzja, fil-każijiet kollha fejn id-dispożizzjonijiet ta’ direttiva jidhru, mill-aspett tal-kontenut tagħhom, mingħajr kundizzjonijiet u preċiżi biżżejjed, l-individwi jistgħu jinvokawhom quddiem il-qrati nazzjonali kontra l-Istat meta dan jew ikun naqas milli jittrasponi d-direttiva fid-dritt nazzjonali fit-termini previsti jew ikun għamel traspożizzjoni inkorretta tagħha (ara s-sentenzi tas-17 ta’ Lulju 2008, Flughafen Köln vs Bonn, C‑226/07, Ġabra p. I‑5999, punt 23; u tat-3 ta’ Marzu 2011, Auto Nikolovi, C‑203/10, li għadha ma ġietx ippubblikata fil-Ġabra, punt 61).
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57. It also follows from the Court’s case-law that the fact that a provision of a directive gives Member States a choice does not necessarily render it impossible to determine with sufficient precision, on the basis of the provisions of the directive alone, the content of the rights thus conferred on individuals (see Flughafen Köln-Bonn , paragraph 30, and Case C‑138/07 Cobelfret [2009] ECR I‑731, paragraph 61).
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57. B arra minn hekk, mill-ġurisprudenza tal-Qorti tal-Ġustizzja jirriżulta li l-fatt li dispożizzjoni ta’ direttiva toffri l-possibbiltà ta’ għażla lill-Istati Membri ma jeskludix neċessarjament il-possibbiltà li l-kontenut tad-drittijiet hekk mogħtija lill-individwi jiġi ddeterminat bi preċiżjoni suffiċjenti abbażi biss tad-dispożizzjonijiet ta’ din id-direttiva (ara s-sentenzi Flughafen Köln vs Bonn, iċċitata iktar ’il fuq, punt 30, u tat-12 ta’ Frar 2009, Cobelfret, C‑138/07, Ġabra p. I‑731, punt 61).
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58. Article 80(1) of the VAT Directive establishes unequivocally and exhaustively the conditions to be satisfied for a Member State to be able to provide in its legislation for the possibility of correcting the taxable amount of a transaction between connected persons.
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58. L-Artikolu 80(1) tad-Direttiva VAT jistabbilixxi, mingħajr ekwivoki u b’mod eżawrjenti, il-kundizzjonijiet li jridu jiġu sodisfatti sabiex Stat Membru jkun jista’ jipprevedi, fil-leġiżlazzjoni tiegħu, il-possibbiltà li l-ammont taxxabli ta’ operazzjoni bejn persuni konnessi jiġi kkoreġut.
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59. That being so, if the transactions at issue in the main proceedings which fall within Article 27(3) of the ZDDS correspond to one of the situations set out in Article 80(1), the Member State concerned must be regarded as having made use of the option provided for in that provision.
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59. F’dan il-każ, jekk l-operazzjonijet inkwistjoni fil-kawżi prinċipali, li jaqgħu taħt l-Artikolu 27(3) taz-ZDDS, jikkorrispondu għal waħda mis-sitwazzjonijiet previsti fl-imsemmi Artikolu 80(1), l-Istat Membru kkonċernat għandu jitqies bħala Stat li għamel użu mill-għażla prevista f’dan l-istess Artikolu 80(1).
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60. By contrast, if those transactions do not correspond to those referred to in Article 80(1) of the VAT Directive, that article must be interpreted as conferring on companies such as the applicants in the main proceedings the right to rely on it directly to oppose the application by the referring court of provisions of national legislation that are contrary to it (see, by analogy, Flughafen Köln-Bonn , paragraph 33). In that case, should it prove impossible to interpret the relevant provisions of the ZDDS in conformity with Article 80(1) of the VAT Directive, the national court would have to disapply those provisions in so far as they are incompatible with Article 80(1).
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60. Bil-kontra ta’ dan, jekk l-imsemmija operazzjonijiet ma jikkorrispondux għal dawk imsemmija fl-Artikolu 80(1) tad-Direttiva VAT, dan l-artikolu għandu jiġi interpretat fis-sens li jagħti lil kumpanniji, bħar-rikorrenti fil-kawża prinċipali, id-dritt li jinvokawh direttament sabiex jopponu għall-applikazzjoni, min-naħa tal-qorti tar-rinviju, ta’ dispożizzjonijiet tal-leġiżlazzjoni nazzjonali li jmorru kontrih (ara, b’analoġija, is-sentenza Flughafen Köln vs Bonn, iċċitata iktar ’il fuq, punt 33). F’dan il-każ, sa fejn huwa impossibbli li ssir interpretazzjoni tad-dispożizzjonijiet rilevant taz-ZDDS b’mod konformi mal-Artikolu 80(1) ta’ din id-direttiva, il-qorti nazzjonali ma għandhiex tapplika dawn id-dispożizzjonijiet inkwantu huma inkompatibbli mal-imsemmi Artikolu 80(1).
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61. That would have the consequence t hat Article 73 of the VAT Directive would be applicable in order to establish that, subject to the exceptions provided for by that directive, the taxable amount of the transactions at issue in the main proceedings is the consideration actually received. As the Court has held with respect to Article 11(A)(1)(a) of the Sixth Directive 77/388, as amended by Directive 2006/69, which became Article 73 of the VAT Directive, that provision has direct effect (see, to that effect, Case C‑62/93 BP Soupergaz [1995] ECR I‑1883, paragraphs 34 to 36, and Case C‑62/00 Marks & Spencer [2002] ECR I‑6325, paragraph 47).
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61. Il-konsegwenza ta’ dan tkun li l-Artikolu 73 tad-Direttiva VAT japplika, bl-għan li jiġi stabbilit li, bla ħsara għad-derogi previsti mill-istess direttiva, l-ammont taxxabbli tal-operazzjonijiet inkwistjoni fil-kawża prinċipali huwa kkostitwit mill-korrispettiv realment riċevut. Bħalma l-Qorti tal-Ġustizzja ddeċidiet rigward l-Artikolu 11(A)(1)(a) tas-Sitt Direttiva 77/388, kif emendata bid-Direttiva 2006/69, li sar l-Artikolu 73 tad-Direttiva VAT, din id-dispożizzjoni għandha effett dirett (ara, f’dan is-sens, is-sentenzi tas-6 ta’ Lulju 1995, BP Soupergaz, C‑62/93, Ġabra p. I‑1883, punti 34 sa 36, kif ukoll tal-11 ta’ Lulju 2002, Marks & Spencer, C‑62/00, Ġabra p. I‑6325, punt 47).
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62. The answer to Question 5 in Case C‑621/10 and Question 6 in Case C‑129/11 is therefore that, in circumstances such as those of the main proceedings, Article 80(1) of the VAT Directive confers on the companies concerned the right to rely on it directly to oppose the application of provisions of national legislation that are incompatible with that provision. If it is not possible to interpret the national legislation in conformity with Article 80(1) of the directive, the national court should disapply any provision of that legislation that is contrary to it.
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62. Għaldaqstant, ir-risposta għall-ħames domanda fil-Kawża C‑621/10 u għas-sitt domanda fil-Kawża C‑129/11 għandha tkun li, f’ċirkustanzi bħal dawk tal-kawża prinċipali, l-Artikolu 80(1) tad-Direttiva VAT jagħti lill-kumpanniji kkonċernati d-dritt li jinvokawh direttament sabiex jopponu l-applikazzjoni ta’ dispożizzjonijiet nazzjonali li huma inkompatibbli ma’ din id-dispożizzjoni. Jekk ma tkunx tista’ tagħti interpretazzjoni tal-leġiżlazzjoni nazzjonali b’mod konformi ma’ dan l-Artikolu 80(1), il-qorti tar-rinviju ma għandha tapplika l-ebda dispożizzjoni ta’ din il-leġiżlazzjoni li tmur kontrih.
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Costs
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Fuq l-ispejjeż
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63. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
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63. Peress li l-proċedura għandha, fir-rigward tal-partijiet fil-kawża prinċipali, in-natura ta’ kwistjoni mqajma quddiem il-qorti tar-rinviju, hija din il-qorti li tiddeċiedi fuq l-ispejjeż. L-ispejjeż sostnuti għas-sottomissjoni tal-osservazzjonijiet lill-Qorti tal-Ġustizzja, barra dawk tal-imsemmija partijiet, ma jistgħux jitħallsu lura.
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