Keywords
Summary

Keywords

1. Actions for failure to fulfil obligations Measures adopted by the Member State concerned after proceedings have been commenced Not relevant

(EC Treaty, Art. 169 (now Art. 226 EC))

2. Member States Obligations Implementation of directives Failure Justification Not permissible

(EC Treaty, Art. 169 (now Art. 226 EC))

3. Tax provisions Harmonisation of laws Turnover taxes Common system of value added tax Option for Member States to apply a reduced rate on a transitional basis Maintenance of a reduced rate of 5% applicable to transactions concerning certain goods and services not appearing in Annex H to the Sixth Directive Not permissible

(Council Directive 77/388, Arts 12(3) and 28(2))

4. Tax provisions Harmonisation of laws Turnover taxes Common system of value added tax Taxable persons Bodies governed by public law Activities in the exercise of public authority not taxable Such activities taxable in the event of significant distortions of competition

(Council Directive 77/388, Art. 4(5), first and second subparas)

Summary

1. In an action for failure to fulfil obligations, the Court cannot take account of measures adopted by the Member State concerned in order to comply with those obligations after the action has been commenced.

( see para. 20 )

2. A Member State cannot rely on provisions, practices or circumstances in its own legal order to justify failure to implement a directive within the prescribed period.

( see para. 20 )

3. It is an infringement of a Member State's obligations under Articles 12(3) and 28(2) of the Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes for that Member State to maintain in force a reduced rate of value added tax of 5% on transactions concerning certain goods and services which do not appear on the list in Annex H to the Sixth Directive. Member States which applied a reduced rate to those transactions on 1 January 1991 are entitled, under the provisions cited above, to apply a reduced rate of value added tax on those operations, which may not, however, be lower than 12%.

( see paras 17, 21 and operative part )

4. Where the conditions laid down in the first subparagraph of Article 4(5) of the Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes are fulfilled, namely where bodies governed by public law engage in activities as public authorities, services supplied by such bodies are not subject to value added tax. If, however, exemption of the activity in question from value added tax would lead to significant distortions of competition within the meaning of the second subparagraph of Article 4(5) of the Sixth Directive, the activity is taxable by virtue of the latter provision.

( see paras 25, 27-28 )