Vodafone Portugal – Comunicações Pessoais, SA v Autoridade Tributária e Aduaneira.

• Jurisdiction: European Union
• Celex Number: 62019CJ0043
• ECLI: ECLI:EU:C:2020:465
• Date: 11 June 2020
• Docket Number: C-43/19
• Court: Court of Justice (European Union)

Provisional text

JUDGMENT OF THE COURT (Ninth Chamber)

11 June 2020 (*)

(Reference for a preliminary ruling — Value added tax (VAT) — Directive 2006/112/EC — Article 2(1)(c) — Scope — Taxable transactions — Services supplied for consideration — Monies paid where customers fail to comply with the contractual tie-in period — Characterisation)

In Case C‑43/19,

REQUEST for a preliminary ruling under Article 267 TFEU from the Tribunal Arbitral Tributário (Centro de Arbitragem Administrativa) (Tax Arbitration Tribunal (Centre for Administrative Arbitration), Portugal), made by decision of 2 January 2019, received at the Court on 24 January 2019, in the proceedings

Vodafone Portugal — Comunicações Pessoais SA

v

Autoridade Tributária e Aduaneira,

THE COURT (Ninth Chamber),

composed of S. Rodin, President of the Chamber, D. Šváby and K. Jürimäe (Rapporteur), Judges,

Advocate General: G. Pitruzzella,

Registrar: M. Ferreira, Principal Administrator,

having regard to the written procedure and further to the hearing on 30 January 2020,

after considering the observations submitted on behalf of:

– Vodafone Portugal — Comunicações Pessoais SA, by S. Fernandes de Almeida, J. Lobato Heitor and A. Costa, advogados,

– the Portuguese Government, by L. Inez Fernandes, T. Larsen, R. Campos Laires and P. Barros da Costa, acting as Agents,

– Ireland, by J. Quaney and M. Browne, acting as Agents, and by N. Travers, Senior Counsel,

– the United Kingdom Government, by Z. Lavery, acting as Agent, and by E. Mitrophanous, Barrister,

– the European Commission, initially by L. Lozano Palacios and A. Caeiros, and subsequently by L. Lozano Palacios and I. Melo Sampaio, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1 This request for a preliminary ruling concerns the interpretation of Articles 2(1)(c), 9, 24, 72 and 73 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1; ‘the VAT Directive’).

2 The request has been made in proceedings between Vodafone Portugal — Comunicações Pessoais SA (‘Vodafone’) and the Autoridade Tributária e Aduaneira (Tax and Customs Authority, Portugal), concerning the self-assessment of value added tax (VAT) relating to November 2016.

Legal context

EU law

3 Under Article 2(1)(c) of the VAT Directive, ‘the supply of services for consideration within the territory of a Member State by a taxable person acting as such’ is to be subject to VAT.

4 Article 9(1) of that directive provides:

‘1. “Taxable person” shall mean any person who, independently, carries out in any place any economic activity, whatever the purpose or results of that activity.

Any activity of producers, traders or persons supplying services, including mining and agricultural activities and activities of the professions, shall be regarded as “economic activity”. The exploitation of tangible or intangible property for the purposes of obtaining income therefrom on a continuing basis shall in particular be regarded as an economic activity.’

5Article 24 of the VAT Directive provides:

‘1. “Supply of services” shall mean any transaction which does not constitute a supply of goods.

2. “Telecommunications services” shall mean services relating to the transmission, emission or reception of signals, words, images and sounds or information of any nature by wire, radio, optical or other electromagnetic systems, including the related transfer or assignment of the right to use capacity for such transmission, emission or reception, with the inclusion of the provision of access to global information networks.’

6 Article 64(1) of that directive provides:

‘Where it gives rise to successive statements of account or successive payments, the supply of goods … or the supply of services shall be regarded as being completed on expiry of the periods to which such statements of account or payments relate.’

7Article 72 of the VAT Directive is worded is follows:

‘For the purposes of this Directive, “open market value” shall mean the full amount that, in order to obtain the goods or services in question at that time, a customer at the same marketing stage at which the supply of goods or services takes place, would have to pay, under conditions of fair competition, to a supplier at arm’s length within the territory of the Member State in which the supply is subject to tax.

Where no comparable supply of goods or services can be ascertained, “open market value” shall mean the following:

(1) in respect of goods, an amount that is not less than the purchase price of the goods or of similar goods or, in the absence of a purchase price, the cost price, determined at the time of supply;

(2) in respect of services, an amount that is not less than the full cost to the taxable person of providing the service.’

8 Article 73 of that directive provides:

‘In respect of the supply of goods or services, other than as referred to in Articles 74 to 77, the taxable amount shall include everything which constitutes consideration obtained or to be obtained by the supplier, in return for the supply, from the customer or a third party, including subsidies directly linked to the price of the supply.’

Portuguese law

VAT Code

9 Under Article 1(1)(a) of the Código do Imposto sobre o Valor Acrescentado (Value Added Tax Code; ‘the VAT Code’), the supply of goods and the supply of services for consideration within the national territory by a taxable person acting as such are to be subject to value added tax.

10 Article 4(1) of the VAT Code provides that transactions effected for consideration which do not qualify as a supply, intra-Community purchase or importation of goods must be treated as a supply of services.

11 Article 16(6)(a) of the VAT Code provides:

‘The following shall be excluded from the basis of assessment referred to in the previous paragraph:

(a) interest due on the deferred payment of consideration and amounts received, pursuant to a judicial decision, as damages for the total or partial failure to discharge obligations’.

The Law on electronic communications

12 Lei n.º 5/2004, das comunicações electrónicas (Law No 5/2004 on electronic communications), of 10 February 2004 (Diário da República I, Series I‑A, No 34, of 10 February 2004), as amended by Lei n.º 15/2016 (Law No 15/2016), of 17 June 2016 (Diário da República, 1st Series, No 115, of 17 June 2016) (‘the Law on electronic communications’), provides in Article 47(1) and (2)(c):

‘1. Undertakings which supply public communications networks, or publicly accessible electronic communications services, shall be required to make available to the public, and to any person who expresses the intention to enter into a contract for services provided by them, adequate, transparent, comparable and updated information on standard terms and conditions, in respect of access to, and use of, the services which the undertakings provide to end-users and consumers, setting out in detail their prices and other charges, including those, if any, relating to contract termination.

2. For the purposes of the application of the previous paragraph, those undertakings must publish … the following information, which must also be provided in advance to any person who intends to enter into a contract for services with them:

…

(c) normal prices, specifying the amounts payable for each of the services provided and the content of each price component, including in particular:

(i) activation charges and charges for access, use and maintenance;

(ii) detailed information on the normal discounts applied and the special or specific tariff regimes, and any additional charges;

(iii) costs of terminal equipment hired or purchased by the customer;

(iv) contract termination charges, including the return of equipment or penalties for early termination at the subscriber’s request’.

13 Article 48 of the Law on electronic communications provides:

‘1. Without prejudice to the legislation applicable to consumer protection, the supply of public communications networks and the supply of publicly accessible electronic communications services must be covered by a contract in which the following information must be set out clearly, exhaustively and in an easily accessible manner:

…

(g) the term of the contract and the conditions governing renewal, suspension and termination of the services and of the contract;

…

2. Information relating to the term of the contract, including conditions governing its renewal and termination, must be clear, intelligible, appear on a durable medium and include the following particulars:

(a) any tie-in period which depends on the provision to the consumer of any kind of identified and quantified benefit related to terminal-equipment subsidies, installation and activation of the service or other promotions;

(b) any charges incurred as a result of the portability of numbers and other identifiers;

(c) any charges incurred as a result of the early termination of the contract during the tie-in period at the subscriber’s request...