ECJ C-639/24 (FLO VENEER) – Questions – VAT Exemption Conditions and Evidence Requirements for intra-EU supplies

The ECJ released the facts and questions in the case C-639/24 (FLO VENEER).

Context:

Summary

Article 45a of Implementing Regulation No 282/2011 outlines evidence needed for VAT exemption on intra-Community supplies under Article 138 of the VAT Directive.
Presumptions exist that goods are dispatched from a Member State to another within the Community, but other conditions of Article 138 must also be satisfied.
The applicant must possess specific documentation, including a written statement from the acquirer and additional evidence as detailed in Article 45a(3).
Tax authorities may dispute the presumption if evidence has formal defects, such as missing supply dates, yet must assess all evidence collectively.
A failure to meet formal evidence requirements does not automatically negate VAT exemption if substantive conditions of Article 138 are satisfied.

Article in the EU VAT Directive

Article 138(1) of the EU VAT Directive 2006/112/EC

Article 138

1. Member States shall exempt the supply of goods dispatched or transported to a destination outside their respective territory but within the Community, by or on behalf of the vendor or the person acquiring the goods, where the following conditions are met:

(a) the goods are supplied to another taxable person, or to a non-taxable legal person acting as such in a Member State other than that in which dispatch or transport of the goods begins;
(b) the taxable person or non-taxable legal person for whom the supply is made is identified for VAT purposes in a Member State other than that in which the dispatch or transport of the goods begins and has indicated this VAT identification number to the supplier.
1a. The exemption provided for in paragraph 1 shall not apply where the supplier has not complied with the obligation provided for in Articles 262 and 263 to submit a recapitulative statement or the recapitulative statement submitted by him does not set out the correct information concerning this supply as required under Article 264, unless the supplier can duly justify his shortcoming to the satisfaction of the competent authorities.

2. In addition to the supply of goods referred to in paragraph 1, Member States shall exempt the following transactions:

(a) the supply of new means of transport, dispatched or transported to the customer at a destination outside their respective territory but within the Community, by or on behalf of the vendor or the customer, for taxable persons, or non-taxable legal persons, whose intra-Community acquisitions of goods are not subject to VAT pursuant to Article 3(1), or for any other non-taxable person;
(b) the supply of products subject to excise duty, dispatched or transported to a destination outside their respective territory but within the Community, to the customer, by or on behalf of the vendor or the customer, for taxable persons, or non-taxable legal persons, whose intra-Community acquisitions of goods other than products subject to excise duty are not subject to VAT pursuant to Article 3(1), where those products have been dispatched or transported in accordance with Article 7(4) and (5) or Article 16 of Directive 92/12/EEC;
(c) the supply of goods, consisting in a transfer to another Member State, which would have been entitled to exemption under paragraph 1 and points (a) and (b) if it had been made on behalf of another taxable person.

Article 45a of Implementing Regulation No 282/2011

1. For the purpose of applying the exemptions laid down in Article 138 of Directive 2006/112/EC, it shall be presumed that goods have been dispatched or transported from a Member State to a destination outside its territory but within the Community in either of the following cases:

(a) the vendor indicates that the goods have been dispatched or transported by him or by a third party on his behalf, and either the vendor is in possession of at least two items of non-contradictory evidence referred to in point (a) of paragraph 3 which were issued by two different parties that are independent of each other, of the vendor and of the acquirer, or the vendor is in possession of any single item referred to in point (a) of paragraph 3 together with any single item of non-contradictory evidence referred to in point (b) of paragraph 3 confirming the
dispatch or transport which were issued by two different parties that are independent of each other, of the vendor and of the acquirer;
(b) the vendor is in possession of the following:
- (i) a written statement from the acquirer, stating that the goods have been dispatched or transported by the acquirer, or by a third party on behalf of the acquirer, and identifying the Member State of destination of the goods; that written statement shall state: the date of issue; the name and address of the acquirer; the quantity and nature of the goods; the date and place of the arrival of the goods; in the case of the supply of means of transport, the identification number of the means of transport; and the identification of the individual
  accepting the goods on behalf of the acquirer; and
- (ii) at least two items of non-contradictory evidence referred to in point (a) of paragraph 3 that were issued by two different parties that are independent of each other, of the vendor and of the acquirer, or any single item referred to in point (a) of paragraph 3 together with any single item of non-contradictory evidence referred to in point (b) of paragraph 3 confirming the dispatch or transport which were issued by two different parties that are independent of each other, of the vendor and of the acquirer.
  The acquirer shall furnish the vendor with the written statement referred to in point (b)(i) by the tenth day of the month following the supply.

2. A tax authority may rebut a presumption that has been made under paragraph 1.
3. For the purposes of paragraph 1, the following shall be accepted as evidence of dispatch or transport:

(a) documents relating to the dispatch or transport of the goods, such as a signed CMR document or note, a bill of lading, an airfreight invoice or an invoice from the carrier of the goods;
(b) the following documents:
- (i) an insurance policy with regard to the dispatch or transport of the goods, or bank documents proving payment for the dispatch or transport of the goods;
- (ii) official documents issued by a public authority, such as a notary, confirming the arrival of the goods in the Member State of destination;
- (iii) a receipt issued by a warehouse keeper in the Member State of destination, confirming the storage of the goods in that Member State’

Background & Facts

Subject Matter of the Main Proceedings:

The case involves the examination of the lawfulness of a tax assessment by the Croatian Ministry of Finance, Tax Authority, Sisak Branch, dated 8 October 2020, and a subsequent decision by the Ministry of Finance, Independent Sector for Second-Instance Administrative Procedure, dated 4 May 2021.
The applicant, FLO VENEER d.o.o., was denied an exemption from value-added tax (VAT) for certain intra-Community supplies of goods performed between 1 January 2020 and 31 March 2020.

Facts and Procedure in the Main Proceedings:

Between January and March 2020, FLO VENEER d.o.o. supplied oak logs to an acquirer in Slovenia, issuing invoices totaling HRK 1,562,616.64 (EUR 209,930.20).
During a tax inspection, the Croatian tax authority found that the conditions for VAT exemption were not met and assessed VAT amounting to HRK 390,654.16.
The applicant presented invoices, proof of shipment, waybills (CMR notes), and statements signed by both parties. However, the tax authority found these documents insufficient due to formal defects (e.g., missing dates).

Arguments and Reasoning:

The applicant argues that Article 45a of Implementing Regulation No 282/2011 aims to harmonize and standardize evidence requirements for VAT exemptions, facilitating proof rather than departing from fiscal neutrality principles.
The applicant contends that possession of specified documentation creates a legal presumption of meeting exemption conditions unless rebutted by tax authorities.
The referring court notes that while formal defects exist in the evidence presented, there is no doubt about the actual transportation of goods from Croatia to Slovenia.
The court refers to EU case law emphasizing that substantive conditions should prevail over formal requirements unless non-compliance prevents conclusive evidence.

Questions

Should Article 138(1) of the VAT Directive, which concerns exemptions from VAT on intra-Community supplies of goods, and Article 45a of Implementing Regulation No 282/2011, which concerns evidence that goods have been dispatched or transported from a Member State to a destination outside its territory but within the Community, be interpreted as meaning that a supplier should be denied an exemption from VAT if it has failed to provide evidence that the conditions outlined in Article 45a of Implementing Regulation No 282/2011 have
been met, or is the tax authority obliged – in the event that the supplier is not in possession of sufficient evidence for the presumption referred to in Article 45a of Implementing Regulation No 282/2011 to be made, but is in possession of evidence proving the physical movement of the goods from one Member State to the other – to examine the evidence presented and determine the facts and circumstances that are relevant to the exemption provided for in Article 138 of the VAT Directive, namely whether the goods were dispatched or transported from the Member State to a destination outside its territory but within the Community?

–Source