1.

In its judgment of 22 June 2016, Český rozhlas (C‑11/15, ‘the judgment in Český rozhlas’, EU:C:2016:470), the Court held that the activities of public radio broadcasters funded by a compulsory charge levied by law on persons owning radio receivers do not constitute a supply of services for consideration and do not fall within the scope of the common system of value added tax (VAT).

2.

Following that ruling, in certain Member States where such charges were subject to VAT, those liable to pay them claimed reimbursement of that tax on the basis that it had been levied contrary to EU law. In Austria, this has led to the filing of a class action of which the main proceedings in the present case form part. Similar proceedings are also ongoing in Denmark. ( 2 )

3.

In this context, the interested parties, as well as the European Commission, state that EU law on VAT provides for a derogation for certain Member States, allowing them to tax the activities of public service broadcasters. The question therefore arises as to whether this derogation alters the conclusions of the judgment in Český rozhlas.

4.

Under Article 151 of the Act concerning the conditions of accession of the Kingdom of Norway, the Republic of Austria, the Republic of Finland and the Kingdom of Sweden and the adjustments to the Treaties on which the European Union is founded, of 26 July 1994 (‘the 1994 Act of Accession’), ( 3 ) read in conjunction with point 2(h) of Part IX of Annex XV thereto, ( 4 ) by way of derogation from the provisions of EU law on VAT, Austria may tax, inter alia, the activities of public radio and television bodies. ( 5 ) This taxation cannot affect the Union’s own resources, the basis of which should be reconstituted in accordance with Regulation (EEC, Euratom) No 1553/89. ( 6 )

5.

In accordance with Article 2(1)(c) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax: ( 7 )

‘The following transactions shall be subject to VAT:

…

6.

Article 132(1)(q) of that directive states:

‘Member States shall exempt the following transactions:

…

7.

Under Article 378(1) of Directive 2006/112:

‘Austria may continue to tax the transactions listed in point (2) of Annex X, Part A.

8.

Annex X to that directive mentions, in point (2) of Part A, ‘the activities of public radio and television bodies other than those of a commercial nature’.

9.

Paragraph 2(1) of the Bundesgesetz betreffend die Einhebung von Rundfunkgebühren (Federal law on the levying of broadcasting fees ( 8 ) (‘the RGG’) requires any person using a radio or television receiver indoors to pay a ‘radio and television fee’. The possession of such a receiver is deemed to be equivalent to its use. According to Paragraph 4(1) of the RGG, Gebühren Info Service GmbH (‘GIS’) is authorised to collect the fee and any related taxes.

10.

The Bundesgesetz über den Österreichischen Rundfunk (Federal law on the Österreichischer Rundfunk ( 9 ) (‘the ORF-G’) establishes in Paragraph 1(1) the public service broadcaster in the form of a public law foundation called Österreichischer Rundfunk (‘the ORF’).

11.

Paragraph 31 of the ORF-G establishes a ‘programme fee’, the amount of which is set by the board of that foundation. Any owner of a radio or television receiver (analogue or digital) located in a terrestrial broadcasting zone for ORF programmes is liable for the programme fee. The programme fee is collected simultaneously with and on the same basis as the broadcasting fee.

12.

Lastly, Paragraph 10 of the Bundesgesetz über die Besteuerung der Umsätze (Federal law on VAT) ( 10 ) provides for a reduced tax rate for, in particular, the broadcasting services subject to payment of the broadcasting fee.

13.

BM, the applicant in the main proceedings, is a recipient of radio and television programmes subject to the payment of a programme fee. Between 1 October 2013 and 31 October 2018, she paid, inter alia, the amount of EUR 100.57 in VAT on the programme fee payable by her. On 23 October 2018, she applied to GIS for a refund of that sum on the basis that it had been levied contrary to EU law. In the light, in particular, of the judgment in Český rozhlas, the applicant submits that the activities of public radio and television broadcasters financed by a fee such as the Austrian programme fee are not subject to VAT.

14.

GIS refused to refund that tax, which BM challenged before the Bundesverwaltungsgericht (Federal Administrative Court, Austria). However, that court dismissed her claim, holding that the interpretation resulting from that judgment was not applicable to the Austrian programme fee. BM brought an appeal on a point of law against the judgment of that court before the referring court.

15.

In those circumstances, the Verwaltungsgerichtshof (Supreme Administrative Court, Austria) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

16.

The reference for a preliminary ruling was received by the Court on 11 April 2022. Written observations were submitted by the parties to the main proceedings, the ORF, the Austrian and Danish Governments and the Commission. Those parties, as well as the French Government, were represented at the hearing on 15 February 2023.

17.

The applicant in the main proceedings seeks a refund of the VAT that was added to the programme fee that she had paid. She submits that, in the light of the judgment in Český rozhlas, the VAT had been charged contrary to EU law. Through the questions referred for a preliminary ruling in the present case, which I propose to deal with together, the referring court thus seeks, in essence, to ascertain whether Article 2(1)(c) of Directive 2006/112, in conjunction with Article 378(1) of that directive and Article 151(1) of the 1994 Act of Accession and point 2(h) of Part IX of Annex XV thereto, should be interpreted as meaning that the Republic of Austria is entitled to levy VAT on the programme fee within the meaning of Paragraph 31 of the ORF-G.

18.

The answer to that question requires, first, an analysis of the nature of the programme fee in the light of Article 2(1)(c) of Directive 2006/112, followed by consideration of the potential impact on that legal issue of Article 378(1) of that directive and Article 151(1) of the 1994 Act of Accession, which forms the basis thereof, and the relevant point of Annex XV thereto.

19.

Both the referring court in its order and GIS, the ORF and the Austrian Government in their submissions argue that the Austrian programme fee differs fundamentally from the fee at issue in the case which gave rise to the judgment in Český rozhlas, and that it can therefore be regarded as consideration for the use of the ORF’s services, with the result that those services should be regarded as being supplied for consideration within the meaning of Article 2(1)(c) of Directive 2006/112.

20.

It is submitted that the differences arise, first, from the fact that the obligation to pay the programme fee is linked not so much to the mere possession of a receiver, but to the actual possibility of receiving the broadcasts transmitted by the ORF. That possibility arises from the possession of a receiver capable of receiving those broadcasts (by terrestrial, satellite or cable) and located in the zone in which they are broadcast. ( 11 ) Acquiring such a receiver and adapting it to receive ORF broadcasts would be an expression of the recipient’s wish to use the broadcaster’s services. Second, unlike the fee at issue in the case that led to the judgment in Český rozhlas, the amount of the programme fee is set not by the legislature, but by the ORF. Third and finally, at the time the programme fee was implemented in 1966, the Austrian legislature established a legal fiction in the form of a civil law relationship between the ORF and the (potential) recipients of its broadcasts. According to the referring court, in spite of a change in the law since then, this legal fiction is still recognised in the case-law of the Austrian courts.

21.

In my view, however, the above differences between the Austrian programme fee and the fee at issue in the case which gave rise to the judgment in Český rozhlas do not justify a different assessment of the former from the point of view of Directive 2006/112.

22.

As in the case referred to above, the present case concerns two services that are legally independent of each other: on the one hand, the ORF, in performing the task entrusted to it by the legislature, broadcasts radio and television programmes for free reception, and on the other hand, potential recipients of those programmes equipped with the relevant receivers are obliged by law to pay the programme fee. It is clear that those receivers can also be used to receive programmes from other broadcasters and for purposes wholly unrelated to enjoying radio and television programmes, and therefore their acquisition and adaptation to receive broadcasts can in no way be regarded as an expression of the wish to use the ORF’s services.

23.

By analogy with the case that led to the judgment in Český rozhlas, in the present case there is no legal relationship between the ORF and the persons liable to pay the programme fee under which there is an exchange of reciprocal performance. ( 12 ) The fact that the obligation to pay the programme fee is based not on the formal condition of owning a receiver, but on the actual ability to receive the broadcasts, does not fundamentally change that situation.

24.

The situation in the present case is therefore different from that considered by the Court in the case which led to the judgment in Kennemer Golf, ( 13 ) referred to in the order of the referring court. In the latter case, the recipient of the service voluntarily entered into a contract with the service provider which allowed him to use the facilities of a sports club for a limited period of time in return for a flat-rate payment. Thus, although the question whether he actually used the facilities was irrelevant to the obligation to pay the consideration, the very possibility of using the facilities was strictly conditional on the payment of that consideration and the parties entered into that legal relationship entirely at their will.

25.

The same is true with regard to the judgment in Air France-KLM and Hop!-Brit Air ( 14 ) cited by the ORF. The cases leading to that judgment concerned airline tickets which remained unused by their purchasers. The fact that the purchasers did not ultimately make use of the transport services does not alter the fact that there was payment for a service which, on the part of the service provider, was performed (the flight took place). There was therefore a supply of services for consideration within the meaning of Article 2(1)(c) of Directive 2006/112, based on a legal relationship freely entered into by the parties.

26.

Furthermore, the fact that it is the ORF, rather than the legislature directly, that sets the programme fee is irrelevant to assessing the situation in the present case. The ORF sets the amount of the fee on the basis of the authority conferred by law. The fee thus retains the nature of a public levy established by law, and the legislature has merely entrusted the determination of its level with the entity that is funded by the proceeds of the levy.

27.

I also agree with the Commission’s view that the concept of ‘supply of services for consideration’ within the meaning of Article 2(1)(c) of Directive 2006/112 is an autonomous concept of EU law and the fact that Austrian law recognises the existence of a legal fiction whereby a legal relationship of a contractual nature exists between the ORF and the persons liable to pay the fee is therefore irrelevant for the classification of the programme fee in terms of that provision. Indeed, according to the Court’s established case-law, whether a specific transaction is subject to or exempt from VAT does not depend on how that transaction is classified under national law. ( 15 ) The programme fee must therefore be classified solely on the basis of EU law and the case-law of the Court – in this case primarily the judgment in Český rozhlas.

28.

In view of the above, I am of the opinion that the programme fee, like the fee at issue in the case which led to the judgment in Český rozhlas, does not constitute consideration for the broadcasting services provided by the ORF. It remains to be examined whether that conclusion is altered by Article 378(1) of Directive 2006/112 and Article 151(1) of the 1994 Act of Accession, read in conjunction with point 2(h) of Part IX of Annex XV thereto.

29.

Article 378(1) of Directive 2006/112 implements, at the level of secondary legislation, Article 151 of the 1994 Act of Accession, read in conjunction with point 2(h) of Part IX of Annex XV thereto, which allows the Republic of Austria to charge VAT on the services of public radio and television broadcasters, that is to say, in practice, the ORF. However, it appears that the wording of those provisions deviates from the objectives that both the Union legislature and the Member States intended for them to achieve when negotiating the 1994 Act of Accession.

30.

Article 151(1) of the 1994 Act of Accession is a framework provision according to which the acts listed in Annex XV thereto apply to the new Member States (including the Republic of Austria) subject to the conditions laid down in that Annex. The actual normative content of the provisions of interest to us should therefore be sought in that annex.

31.

According to point 2(h) of Part IX of Annex XV to the 1994 Act of Accession, ‘for the purposes of applying’ Article 28(3)(a) of Sixth Directive 77/388, the Republic of Austria may tax the transactions listed in point 7 of Annex E to that Directive. Article 28 of Sixth Directive 77/388 was contained in Title XVI of that directive, headed ‘Transitional provisions’. By virtue of paragraph 3(a) of that article, Member States were able, by way of derogation from the exemption laid down in Articles 13 and 15 of that directive, to maintain the taxation of the transactions listed in Annex E to the directive. Point 7 of that annex lists the activities of public radio and television broadcasters, exempted in principle under Part A of Article 13(1)(q) of Sixth Directive 77/388. In other words, point 2(h) of Part IX of Annex XV to the 1994 Act of Accession granted the Republic of Austria the derogation contained in Article 28(3)(a) of Sixth Directive 77/388, in conjunction with point 7 of Annex E thereto, according to which Member States in which the activities of public radio and television broadcasters had hitherto been subject to VAT could continue to charge that VAT despite the exemption of those activities under the general provisions of the directive.

32.

Under Article 28(3) and (4) of Sixth Directive 77/388, the derogations contained in Article 28(3) were to apply for a transitional period. That period was to end when the derogations were abolished by a Council decision. In fact, however, the transitional period has not yet ended and the derogations still in force have been transferred to Directive 2006/112 as ‘derogations applying until the adoption of definitive arrangements’. ( 16 ) The derogation available to the Republic of Austria under Article 151(1) of the 1994 Act of Accession in conjunction with point 2(h) of Part IX of Annex XV thereto, is contained in Article 378(1) of Directive 2006/112, in conjunction with point 2 of Part A of Annex X to that directive, worded analogously to point 7 of Annex E to Sixth Directive 77/388.

33.

Neither Article 378(1) of Directive 2006/112 nor Part A of Annex X thereto expressly state that the derogations established therein relate to the exemptions provided for in Article 132 of that directive. However, this seems obvious to me. This is indicated first by the legislative background of Article 378(1) of Directive 2006/112 and the wording of its predecessor, Article 28(3)(a) of Sixth Directive 77/388. ( 17 ) Second, the wording of point 2 of Part A of Annex X to Directive 2006/112 corresponds literally to the wording of the exemption contained in Article 132(1)(q) of that directive.

34.

It should therefore be concluded that Article 378(1) of Directive 2006/112, in conjunction with point 2 of Part A of Annex X to that directive, establishes a derogation from the exemption contained in Article 132(1)(q) thereof in favour of the Republic of Austria. However, the exemptions provided for in that article can logically only apply to transactions which could be taxed, otherwise their exemption would not be needed. The Court has explicitly confirmed this in the judgment in Český rozhlas. ( 18 )

35.

I therefore do not share the view of GIS, the Austrian, Danish and French Governments and the Commission that Article 378(1) of Directive 2006/112, in conjunction with point 2 of Part A of Annex X thereto permits taxation outside the scope of that directive, as results, in particular, from Article 2(1)(c) thereof. ( 19 ) A derogation from a provision falling within the scope of a directive (in this case Article 132(1)(q) of Directive 2006/112) cannot, logically, itself fall outside that scope.

36.

Notwithstanding the scope of application of Article 378(1) of Directive 2006/112 discussed above, its content, taken literally, cannot serve as a basis for the Republic of Austria to charge VAT on the programme fee.

37.

However, it does allow the Republic of Austria to subject the activities of public radio and television broadcasters to VAT. But, as the Court stated in the judgment in Český rozhlas, which, as discussed in points 20 to 29 of this Opinion, is applicable to the present case, the activities of such broadcasters, to the extent that they are financed by the proceeds of a levy such as the Austrian programme fee, do not constitute supplies of services for consideration and, as such, cannot be subject to that tax.

38.

VAT is in fact a consumption tax the basis of assessment of which is, in accordance with Article 73 of Directive 2006/112, the price of goods or services, that is, the amount received by the taxable person in payment for goods or services. In the case of a service provided free of charge, there is no taxable amount on which VAT can be charged and, consequently, no possibility to apply it.

39.

In view of the above, I am of the opinion that neither the wording of Article 378(1) of Directive 2006/112 and point 2 of Part A of Annex X thereto, nor, consequently, the wording of Article 151 of the 1994 Act of Accession in conjunction with point 2(h) of Part IX of Annex XV thereto, alters the conclusions reached in points 20 to 29 of this Opinion.

40.

A literal interpretation of the provisions of Directive 2006/112 would therefore lead to the conclusion that treating the activities of a public service broadcaster funded by the proceeds of a programme fee as taxable is incompatible with those provisions. However, as appears to be the case, and as both the referring court in its order and, in particular, the Danish Government in its observations point out, that was not the intention of the Member States when negotiating point 2(h) of Part IX of Annex XV to the 1994 Act of Accession, nor of the EU legislature with regard to Article 378(1) of Directive 2006/112 in conjunction with point 2 of Part A of Annex X to that directive, and before that Article 28(3) of Sixth Directive 77/388 and point 7 of Annex E thereto.

41.

The Danish Government explains that the wording of those provisions is the manifestation of a compromise between the Member States which, during the legislative work on Sixth Directive 77/388, were unable to agree on the taxation of public service broadcasters funded by the proceeds of a levy such as the Austrian programme fee. The compromise was that those services were exempted in principle, while the relevant Member States were given the option to derogate from that exemption. That derogation was subsequently extended to certain new Member States, including the Republic of Austria, by virtue of point 2(h) of Part IX of Annex XV to the 1994 Act of Accession, now implemented into secondary legislation in Article 378(1) of Directive 2006/112 in conjunction with point 2 of Part A of Annex X to that directive.

42.

This solution may have been justified in 1977, when Sixth Directive 77/388 was being drawn up. At the time, in most Member States there was a monopoly or quasi-monopoly of public service broadcasters, in particular television broadcasters, and the only practical use for domestic radio and television sets was to receive terrestrial broadcasts. It could therefore be considered in principle that the purchase of such a receiver was tantamount to using the services of public service broadcasters, and a compulsory fee for owning one constituted sui generis consideration for those services. It should also be borne in mind that that solution was introduced as a temporary measure, initially for a period of five years.

43.

The justification for that solution had already greatly diminished by the time the 1994 Act of Accession was being negotiated, following the liberalisation of the broadcasting market in Europe supported by the provisions of Directive 89/552/EEC, ( 20 ) and the development of cable and satellite television. However, it is wholly unjustified at the present time when, on the one hand, owning a radio or television set, even if it is capable of receiving broadcasts, is in no way tantamount to using the services of public service broadcasters (or radio or television broadcasters in general) and, on the other hand, such broadcasts can also be received without the aid of such a receiver, even outside the Member State of the broadcaster, in particular via the Internet. The fee for owning a receiver thus constitutes a kind of public levy, which, although it serves to finance the activities of public broadcasters, is completely detached from the actual use of their services. Hence the decision of the Court in the judgment in Český rozhlas.

44.

It should be noted here that the origins of the interpretation of Article 2(1)(c) of Directive 2006/112 adopted by the Court in that judgment go back a long way and should come as no surprise. Already in the judgments in Coöperatieve Aardappelenbewaarplaats ( 21 ) and Hong-Kong Trade Development Council, ( 22 ) handed down while Directive 67/228/EEC ( 23 ) was still in force but shortly after Sixth Directive 77/388 came into effect, the Court ruled that a supply of services can be taxed if the service is provided for consideration, that is to say, there is a direct link between the supply and the consideration actually received for it. Otherwise, there is no taxable amount and the relationship between the parties does not have the character of a contract which is the subject of tax harmonisation. That case-law was then systematically consolidated and developed, ( 24 ) with the decision in the judgment in Český rozhlas as its logical consequence.

45.

Nevertheless, I believe that an interpretation of Article 378(1) of Directive 2006/112 should take into consideration its intended purpose, namely the implementation of point 2(h) of Part IX of Annex XV to the 1994 Act of Accession. Otherwise, Article 378(1) of that directive would become irrelevant, as there would be no services provided by the public service broadcaster in Austria that could be taxed under it. Indeed, that provision has the character of a standstill clause, and the only type of activity to which that clause may apply is that of the ORF that is funded by the proceeds of the programme fee, which was regarded as taxable prior to that country’s accession to the European Union. This would give rise to an internal contradiction between Article 2(1)(c) and Article 378(1) of Directive 2006/112. In my view the existence of such a contradiction undermines the conclusions that can be drawn from a literal interpretation and justifies, in this case, recourse to a systematic and teleological interpretation of the provisions of that directive.

46.

By agreeing on the derogation contained in point 2(h) of Part IX of Annex XV to the 1994 Act of Accession, the Member States intended to allow the Republic of Austria to maintain its national legislation pursuant to which the activities of a public service broadcaster financed by the proceeds of the programme fee were deemed to be subject to VAT, with the consequence that VAT would be added to the fee, and the public service broadcaster was entitled to deduct the VAT it paid on the goods and services used for the purposes of those activities.

47.

As is apparent from both the order for reference and the ORF's observations, the primary motive for the Republic of Austria maintaining, after its accession, the existing tax regime for the activities of that public service broadcaster and the real purpose of the arrangement contained in point 2(h) of Part IX of Annex XV to the 1994 Act of Accession was the preservation of that right of deduction.

48.

In the light of the foregoing, Article 378(1) of Directive 2006/112 must, in my view, be interpreted as allowing the Republic of Austria to treat public service broadcasting as a taxable activity, with the result that it is entitled to deduct input VAT, the resulting loss of tax revenue being offset by an additional levy added to the programme fee, whose proceeds go not to the ORF budget but to the State budget.

49.

That additional charge does not constitute VAT within the meaning of Directive 2006/112, as its basis is not payment of a service effected for consideration. Rather, it is a direct public levy which is completely outside the scope of the common system of VAT. It cannot therefore be regarded as being levied contrary to Directive 2006/112 ( 25 ) or, more broadly, EU law. Admittedly, it may be considered awkward that such an additional levy is called ‘VAT’ and presented as such to those liable to pay it. However, as this does not jeopardise the effectiveness of the common system of VAT, it does not seem to me to constitute a problem that would justify declaring that levy unlawful, in any case under EU law.

50.

This interpretation does not cause undue harm to those liable to pay the programme fee, since, on the basis of the statutory authorisation, the ORF determines the amount of the fee in its entirety, including that additional levy. The latter therefore does not constitute an additional burden for programme fee payers; only the destination of the amount collected is different.

51.

In light of that interpretation, the question of the scope ratione personae of the obligation to pay the programme fee raised in the second question is also irrelevant, since that fee is beyond the scope of EU law.

52.

It should further be noted that the taxation maintained under the second indent of the first subparagraph of point 2(h) of Part IX of Annex XV to the Act of Accession cannot have an impact on the Union’s own resources. However, as the ORF indicates in its observations, the VAT on the programme fee is charged at a reduced rate of 10%, in return for which the ORF is fully entitled to deduct input VAT. On the other hand, the goods and services which the ORF purchases in carrying on its activities are for the most part taxed at the standard rate of VAT (20%), which entails a significant excess of tax paid and a right to the reimbursement of that amount from the State budget, thus depleting the Union’s own resources. This raises the question whether that is compatible with the second indent of the first subparagraph of point 2(h) of Part IX of Annex XV to the Act of Accession. However, this is a matter of the proper implementation by the Republic of Austria of its obligations relating to the Union’s own resources, which does not affect the compatibility with EU law of the additional levy on the programme fee.

53.

In view of all of the above, I propose to answer the questions referred to the Court by the Verwaltungsgerichtshof (Supreme Administrative Court, Austria) as follows:

Article 2(1)(c) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, read in conjunction with Article 378(1) of that directive and Article 151(1) of the Act concerning the conditions of accession of the Kingdom of Norway, the Republic of Austria, the Republic of Finland and the Kingdom of Sweden and the adjustments to the Treaties on which the European Union is founded, of 26 July 1994, and point 2(h) of Part IX of Annex XV thereto,

must be interpreted as meaning that the Republic of Austria is not precluded from levying a charge additional to the programme fee within the meaning of Paragraph 31 of the Bundesgesetz über den Österreichischen Rundfunk (Federal Law on the Österreichischer Rundfunk) in order to compensate for the loss of budgetary revenue from value added tax resulting from the right of a public service broadcaster to deduct tax paid on goods and services acquired by it for the purposes of its activities, which are financed by the proceeds of that programme fee.