ECJ C-602/24 (W.) – Questions – VAT Dispute Over Intra-EU Supply and Export Classification

The ECJ issues the preliminary ruling in the case C-602/24 (W.).

Context:

Articles in the EU VAT Directive 2006/112/EC

Article 5(1) and (2)

For the purposes of applying this Directive, the following definitions shall apply:
(1) “Community” and “territory of the Community” mean the territories of the Member States as defined in point (2);
(2) “Member State” and “territory of a Member State” mean the territory of each Member State of the Community to which the Treaty establishing the European Community is applicable, in accordance with Article 299 of that Treaty, with the exception of any territory referred to in Article 6 of this Directive;’

Article 14(1)

Supply of goods” shall mean the transfer of the right to dispose of tangible property as owner.

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, for another taxable person, or for a non-taxable legal person acting as such in a Member State other than that in which dispatch or transport of the goods began.

Article 146(1)(a) and (b)

Member States shall exempt the following transactions:
- (a) the supply of goods dispatched or transported to a destination outside the Community by or on behalf of the vendor;
- (b) the supply of goods dispatched or transported to a destination outside the Community by or on behalf of a customer not established within their respective territory, with the exception of goods transported by the customer himself for the equipping, fuelling and provisioning of pleasure boats and private aircraft or any other means of transport for private use;

Article 273

Member States may impose other obligations which they deem necessary to ensure the correct collection of VAT and to prevent evasion, subject to the requirement of equal treatment as between domestic transactions and transactions carried out between Member States by taxable persons and provided that such obligations do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers.
The option under the first paragraph may not be relied upon in order to impose additional invoicing obligations over and above those laid down in Chapter 3.’

Facts & Background

Tax Proceedings Summary: In 2017-2018, W. sp. z o.o. declared VAT-exempt intra-Community supplies of apples to A.E. LP, registered in Latvia. However, tax authorities found that the goods were exported directly to Belarus, not Lithuania, making the transaction a domestic supply liable for VAT.
Tax Authorities’ Findings: The authorities determined that A.E. exported the goods outside the EU, and since the goods did not reach another EU Member State, the transaction was not eligible for zero-rated VAT. A penalty was applied to the VAT due.
Company’s Legal Challenge: W. sp. z o.o. argued that the export to Belarus should be treated as an indirect export, which qualifies for zero-rated VAT. The Regional Administrative Court initially agreed, granting the zero VAT rate despite lacking formal export documentation.
Supreme Administrative Court’s Ruling: The Supreme Administrative Court overturned the lower court’s decision, stating that for VAT purposes, the export must be intended as such from the outset by both parties. The reclassification of an intra-Community supply as an export based on later actions by the buyer was not permissible.
Legal Implications: The case was sent back for re-examination, emphasizing that the original transaction documents indicated an intra-Community supply and not an export, thus not qualifying for zero-rated VAT under the circumstances described.

Questions

1. Should Article 146(1)(b) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax […] be interpreted to mean that a supply of goods declared by the taxable person (supplier) as an intra-Community supply of goods should be regarded as a supply for export in the event that the person acquiring the goods has exported them outside the European Union rather than to another Member State?
2. For the purpose of applying the exemption referred to in Article 146(1)(b) of Directive 2006/112/EC in the situation referred to in the first question, is it relevant if the person acquiring the goods has exported them outside the European Union in the absence of an agreement with the taxable person (supplier) or common arrangements with the latter, and instead on the basis of an independent decision and without the knowledge of the taxable person (supplier)?
3. For the purpose of applying the exemption referred to in Article 146(1)(b) of Directive 2006/112/EC in the situation referred to in the first question, is it relevant if the export of the goods outside the European Union results from the findings of the tax authorities based on customs documents, and the content of the transport documents held by the taxable person (supplier) is inconsistent with these findings?

Source