Keywords
Summary

Keywords

1 Tax provisions - Harmonization of laws - Turnover taxes - Common system of value added tax - Exemptions provided by the Sixth Directive - Banking transactions referred to in Article 13B(d), points 3 and 5 - Conditions for exemption relating to the person effecting the transactions and to the manner of effecting them - None

(Council Directive 77/388, Art. 13B(d), points 3 and 5)

2 Tax provisions - Harmonization of laws - Turnover taxes - Common system of value added tax - Exemptions provided by the Sixth Directive - Banking transactions referred to in Article 13B(d), points 3 and 5 - Conditions for exemption relating to the legal relationship between the institution and the bank's end customers - None

(Council Directive 77/388, Art. 13B(d), points 3 and 5)

3 Tax provisions - Harmonization of laws - Turnover taxes - Common system of value added tax - Exemptions provided by the Sixth Directive - Banking transactions referred to in Article 13B(d), points 3 and 5, and Annex F, points 13 and 15 - Conditions for exemption relating to the supply of those services by a data-handling centre - Distinction between an exempt banking service and a mere technical service - Criteria

(Council Directive 77/388, Art. 13B(d), points 3 and 5, and Annex F, points 13 and 15)

4 Tax provisions - Harmonization of laws - Turnover taxes - Common system of value added tax - Exemptions provided by the Sixth Directive - Banking transactions referred to in Article 13B(d), points 3 and 5 - Conditions for exemption relating to invoicing - Invoicing by a third party - No effect

(Council Directive 77/388, Art. 13B(d), points 3 and 5)

Summary

5 Points 3 and 5 of Article 13B(d) of the Sixth Council Directive (77/388/EEC) on the harmonization of the laws of the Member States relating to turnover taxes are to be interpreted as meaning that the exemption which they provide with respect to various banking transactions is not subject to the condition that the transactions be effected by a certain type of institution, by a certain type of legal person or wholly or partly by certain electronic means or manually.

On the one hand, those provisions define the exempt transactions according to the nature of the services provided and not according to the person supplying or receiving them, and, on the other hand, they make no distinction according to the specific manner in which the service is performed.

6 The exemption provided for by points 3 and 5 of Article 13B(d) of the Sixth Directive (77/388) on the harmonization of the laws of the Member States relating to turnover taxes is not subject to the condition that the service be provided by an institution which has a legal relationship with the bank's end customer. The fact that a transaction covered by those provisions is effected by a third party but appears to the end customer to be a service provided by the bank does not preclude exemption for the transaction.

7 In order to be characterized as exempt transactions for the purposes of points 3 and 5 of Article 13B(d) of and Annex F, points 13 and 15, to the Sixth Directive (77/388) on the harmonization of the laws of the Member States relating to turnover taxes, the services provided by a data-handling centre in the context of transactions concerning transfers and payments, those concerning shares, interests in companies and associations, debentures and other securities and those concerning the management of deposits, purchase contracts and loans must, viewed broadly, form a distinct whole, fulfilling in effect the specific, essential functions of the said services.

For that purpose, a service exempt under the directive must be distinguished from a mere physical or technical supply, such as making a data-handling system available to a bank. In this regard, the extent of the data-handling centre's responsibility vis-à-vis the banks, in particular the question whether its responsibility is restricted to technical aspects or whether it extends to the specific, essential aspects of the transactions, may be decisive. On the other hand, the manner in which the various aspects of the service are invoiced is irrelevant for the purposes of the exemption in question, provided that the acts necessary in order to effect the exempt transaction can be identified in relation to the other services.

8 The mere fact that a service is invoiced by a third party does not prevent the transaction to which it relates from being exempt under points 3 and 5 of Article 13B(d) of the Sixth Directive. Such may be the case if the data-handling centre which effects the transactions and the third party which, for organizational reasons, invoices them in reality constitute a unit created to serve the common interests of the persons for whom its services are intended.