- The CJEU provided further interpretation to the concept of VAT fixed establishment in the context of exclusive intra-group toll-manufacturing arrangements in its Cabot-judgment.
- The Belgian VAT authorities claimed that Cabot-CH had a fixed establishment in Belgium for VAT purposes because Cabot-BE’s equipment and human resources were made available to it in such a way that this constituted such establishment.
- The CJEU established that a non-EU recipient does not have a fixed establishment in the Member State of its service provider if the latter supplies it, pursuant to an exclusive contractual undertaking, with tolling services as well as a series of ancillary services that contribute to the economic activity of the non-EU recipient in that EU Member State.
- The decision of the CJEU is in line with the earlier judgment in the “Berlin Chemie” case. This provides more legal certainty to foreign taxpayers as regards the potential existence of a VAT fixed establishment in Belgium.
Source KPMG
See also
- ECJ C-232/22 (Cabot Plastics Belgium) – Judgment – Toll manufacturing with ancillary services does not lead to Fixed Establishment
- Summary of ECJ-232/22 (Cabot) – No fixed establishment due to lack of human and technical resources even if ancillary services are performed, exclusivity
