ECJ Articles 9(1), 10(1) and 20(2) to (6) of Regulation No 2730/79 laying down common detailed rules for the application of the system of export refunds on agricultural products, in the version resulting from Regulation No 568/85, must be interpreted as meaning that a Community exporter can forfeit his right to payment of a non-differentiated export refund if (a) the product in respect of which the export refund was paid, and which is sold to a purchaser established in a non-member country, is, immediately after its release for home use in that non-member country, transported back to the Community under the external Community transit procedure and is there released for home use on payment of import duties, without any infringement being established and (b) that operation constitutes an abuse on the part of that Community exporter. A finding that there is an abuse presupposes an intention on the part of the Community exporter to benefit from an advantage as a result of the application of the Community rules by artificially creating the conditions for obtaining it. Evidence of this must be placed before the national court in accordance with the rules of national law, for instance by establishing that there was collusion between that exporter and the importer of the goods into the non-member country. The fact that, before being re-imported into the Community, the product was sold by the purchaser established in the non-member country concerned to an undertaking also established in that country with which he has personal and commercial links is one of the facts which can be taken into account by the national court when ascertaining whether the conditions giving rise to an obligation to repay refunds are fulfilled.
The exporter was refused a rebate of duty to which he was entitled on the face of the relevant Commission Regulation upon the export of his goods, because he had abused the law by claiming it in respect of goods which had been exported to a third country only to be at once re-imported into the country of origin. The court held at para 59 that:
‘a finding that there has been an abuse presupposes an intention on the part of the Community exporter to benefit from an advantage as a result of the application of the Community rules by artificially creating the conditions for obtaining it.’
The essential reason why the trading scheme failed was that the choice of a circular supply route did not involve a choice between different methods of achieving the trader’s commercial purpose. It had no commercial purpose other than the avoidance of tax.
Judges:
G.C. Rodriguez Iglesias, P
Citations:
C-110/99, [2000] ECR I-11569, [2000] EUECJ C-110/99
Links:
Cited by:
Cited – Revenue and Customs v Debenhams Retail Plc CA 18-Jul-2005
The store introduced a system whereby when a customer paid by credit card, the charges made to them for card handling were expressed as a separate amount on the receipt. The store then said that VAT was payable only on the net amount allocated to . .
Cited – Revenue and Customs v Debenhams Retail Plc CA 18-Jul-2005
The store introduced a system whereby when a customer paid by credit card, the charges made to them for card handling were expressed as a separate amount on the receipt. The store then said that VAT was payable only on the net amount allocated to . .
Cited – Revenue and Customs v Pendragon Plc and Others SC 10-Jun-2015
‘This appeal is about an elaborate scheme designed and marketed by KPMG relating to demonstrator cars used by retail distributors for test drives and other internal purposes. In the ordinary course, a car distributor will buy new cars for use as . .
Lists of cited by and citing cases may be incomplete.
European, VAT, Agriculture
Updated: 04 June 2022; Ref: scu.162629
