ECJ C-573/22 (Foreningen C and Others) – Questions – Whether the VAT charged on the Danish media licence fee between 2007 and 2017 should be refunded

These questions concern, firstly, whether a statutory media licence fee, such as the Danish media licence fee, may be subject to VAT and, secondly, the interpretation of what constitutes an unacceptable amendment to a national derogation scheme covered by a standstill provision.

Article in the EU VAT Directive

Article 370 in the EU VAT Directive 2006/112/EC, read in conjunction with point 2 of Annex X, Part A to Directive 2006/112/EC

Article 370 (Standstill provision)
Member States which, at 1 January 1978, taxed the transactions listed in Annex X, Part A, may continue to tax those transactions.

Facts

During the relevant period in the present case, 2007–2017, VAT was charged on the Danish media licence fee. The applicants have brought an action before the referring court seeking a refund of the VAT charged.
The Danish media licence fee was to be paid in the case of possession of a device subject to a licence fee, which means a device capable of receiving and playing audiovisual programmes or services broadcast to the public. Until 2013, a radio licence fee also had to be paid on radio equipment which could only receive and play radio programmes broadcast to the public.
A media licence fee had to be paid regardless of whether the equipment was used and, if so, of what it was used for. A media licence fee also had to be paid regardless of whether, because of the antenna’s position or other circumstances, the programmes of the institutions financed by the licence could actually be received or not. Conversely, the possibility of receiving the programmes of the institutions financed by the licence was not dependent on the payment of a media licence fee.
The licence fee has been subject to VAT since the first Danish VAT Act of 1967. When the Sixth Directive entered into force on 1 January 1978, only television and radio sets formed the group of devices subject to a licence fee. Between 2007 and 2017, the devices subject to a licence fee were all devices capable of receiving and playing audiovisual programmes or services broadcast to the public, such as television, smartphones, PCs, etc.
When the Sixth Directive entered into force, all licence fee resources were used to finance the public institution DR (Danish Broadcasting Corporation). Between 2007 and 2017, licence fee resources were used to finance DR, the regional companies of TV 2 and, through the Ministry of Culture, other media and filmrelated purposes.

Questions

1. Is Article 370, read in conjunction with point 2 of Annex X, Part A, of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, to be interpreted as permitting the Member States concerned to impose VAT on a statutory media licence fee to finance the non- commercial activities of public radio and television bodies, notwithstanding the absence of a “supply of services for consideration” within the meaning of Article 2(1) of that Directive?
If question 1 is answered in the affirmative, the Court of Justice is asked to answer the following questions referred for a preliminary ruling:
2. Is Article 370, read in conjunction with point 2 of Annex X, Part A, of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, to be interpreted as meaning that a Member State’s option to impose VAT on a statutory media licence fee as specified in question 1 may be maintained if, after the entry into force, on 1 January 1978, of Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes (Sixth Directive), the Member State has altered the licensing system from charging a licence fee for possessing radio and television equipment to charging a licence fee for possessing any device which can receive audiovisual programmes and services directly, including smartphones, computers, etc.?
3. Is Article 370, read in conjunction with point 2 of Annex X, Part A, of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, to be interpreted as meaning that a Member State’s option to impose VAT on a statutory media licence fee as specified in question 1 may be maintained if, after the entry into force, on 1 January 1978, of Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes (Sixth Directive), the Member State has altered the licensing system so that a smaller proportion of the licence fee resources will, at the discretion of the Minister for Culture, be used to finance (i) radio and television bodies which receive public subsidies but are not themselves public, and (ii) media and film organisations which contribute to but do not themselves carry out radio and television activities?

AG Opinion

Decision

Summary

Source