SC Cartrans Preda SRL v Direcţia Generală Regională a Finanţelor Publice Ploieşti - Administraţia Judeţeană a Finanţelor Publice Prahova.

• Jurisdiction: European Union
• Celex Number: 62021CJ0461
• ECLI: ECLI:EU:C:2023:632
• Date: 07 September 2023
• Docket Number: C-461/21
• Procedure Type: Reference for a preliminary ruling
• Court: Court of Justice (European Union)

Provisional text

JUDGMENT OF THE COURT (Third Chamber)

7 September 2023 (*)

(Reference for a preliminary ruling – Directive 2006/112/EC – Common system of value added tax (VAT) – Exemptions – Road carriage transactions directly connected with the import of goods – Rules of evidence – Articles 56 and 57 TFEU – Freedom to provide services – Recovery of VAT by a non-resident – Taxation of consideration paid by way of a tax on the income of non-resident persons – Tax withheld at source by a resident)

In Case C‑461/21,

REQUEST for a preliminary ruling under Article 267 TFEU from the Tribunalul Prahova (Regional Court, Prahova, Romania), made by decision of 17 June 2021, received at the Court on 27 July 2021, in the proceedings

SC Cartrans Preda SRL

v

Direcţia Generală Regională a Finanţelor Publice Ploieşti – Administraţia Judeţeană a Finanţelor Publice Prahova,

THE COURT (Third Chamber),

composed of K. Jürimäe, President of the Chamber, M. Safjan, N. Piçarra, N. Jääskinen (Rapporteur) and M. Gavalec, Judges,

Advocate General: G. Pitruzzella,

Registrar: A. Lamote, Administrator,

having regard to the written procedure and further to the hearing on 10 November 2022,

after considering the observations submitted on behalf of:

– SC Cartrans Preda SRL, by R. Popescu and C. Preda,

– the Romanian Government, by E. Gane and A. Rotăreanu, acting as Agents,

– the European Commission, by A. Armenia, T. Isacu de Groot and E.A. Stamate, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 19 January 2023,

gives the following

Judgment

1 This request for a preliminary ruling concerns the interpretation, first, of Article 144 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’), read in the light of Article 86(1)(b) and (2) of that directive, and, second, of Articles 56 and 57 TFEU.

2 The request has been made in proceedings between SC Cartrans Preda SRL (‘Cartrans’) and the Direcția Generală Regională a Finanțelor Publice Ploiești – Administrația Județeană a Finanțelor Publice Prahova (Regional Directorate-General of Public Finances of Ploiești – Regional Public Finance Administration of Prahova, Romania) (‘the tax authority’) concerning an obligation incumbent on Cartrans to pay, first, an additional amount of value added tax (VAT) in respect of services relating to the carriage of goods intended to be imported into Romania and, second, tax withheld at source on income paid by Cartrans to a non-resident co-contracting company for services for the recovery of VAT abroad.

Legal context

International law

The CMR

3 Romania acceded to the Convention on the Contract for the International Carriage of Goods by Road, signed in Geneva on 19 May 1956, as amended by the protocol signed in Geneva on 5 July 1978 (‘the CMR’), by Decretul nr. 451/1972 privind aderarea României la Convenția referitoare la contractul de transport internațional de mărfuri pe șosele (CMR) (Decree No 451/1972 on the accession of Romania to the Convention on the Contract for the International Carriage of Goods by Road (CMR)) of 20 November 1972.

4 Article 4 of the CMR states:

‘The contract of carriage shall be confirmed by the making out of a consignment note. The absence, irregularity or loss of the consignment note shall not affect the existence or the validity of the contract of carriage which shall remain subject to the provisions of this Convention.’

5 Article 6(1) of the CMR provides:

‘The consignment note shall contain the following particulars:

(a) The date of the consignment note and the place at which it is made out;

(b) The name and address of the sender;

(c) The name and address of the carrier;

(d) The place and the date of taking over of the goods and the place designated for delivery;

(e) The name and address of the consignee;

(f) The description in common use of the nature of the goods and the method of packing, and, in the case of dangerous goods, their generally recognised description;

(g) The number of packages and their special marks and numbers;

(h) The gross weight of the goods or their quantity otherwise expressed;

(i) Charges relating to the carriage (carriage charges, supplementary charges, customs duties and other charges incurred from the making of the contract to the time of delivery);

(j) The requisite instructions for Customs and other formalities;

(k) A statement that the carriage is subject, notwithstanding any clause to the contrary, to the provisions of this Convention.’

The double taxation convention

6 Article 7(1) of the Convention for the avoidance of double taxation between Romania and Denmark, signed in Copenhagen on 13 December 1976 (‘the double taxation convention’), provides:

‘The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. …’

7 Article 12(1) to (3) of the convention provides as follows:

‘1. Commission arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2. However, such commission may be taxed in the Contracting State in which it arises, and according to the law of that State, but the tax so charged shall not exceed 4 per cent of the amount of the commission.

3. The term “commission” as used in this Article means a payment made to a broker, a general commission agent or any other person assimilated to such a broker or agent by the taxation law of the Contracting State in which such payment arises.’

European Union law

8 Under Article 85 of the VAT Directive:

‘In respect of the importation of goods, the taxable amount shall be the value for customs purposes, determined in accordance with the Community provisions in force.’

9 Article 86 of that directive provides:

‘1. The taxable amount shall include the following factors, in so far as they are not already included:

(a) taxes, duties, levies and other charges due outside the Member State of importation, and those due by reason of importation, excluding the VAT to be levied;

(b) incidental expenses, such as commission, packing, transport and insurance costs, incurred up to the first place of destination within the territory of the Member State of importation as well as those resulting from transport to another place of destination within the Community, if that other place is known when the chargeable event occurs.

2. For the purposes of point (b) of paragraph 1, “first place of destination” shall mean the place mentioned on the consignment note or on any other document under which the goods are imported into the Member State of importation. If no such mention is made, the first place of destination shall be deemed to be the place of the first transfer of cargo in the Member State of importation.’

10 Title IX of that directive is headed ‘Exemptions’ and comprises 10 chapters covering Articles 131 to 166. Article 131 of the directive reads as follows:

‘The exemptions provided for in Chapters 2 to 9 shall apply without prejudice to other Community provisions and in accordance with conditions which the Member States shall lay down for the purposes of ensuring the correct and straightforward application of those exemptions and of preventing any possible evasion, avoidance or abuse.’

11Article 144 of the VAT Directive provides:

‘Member States shall exempt the supply of services relating to the importation of goods where the value of such services is included in the taxable amount in accordance with Article 86(1)(b).’

Romanian law

12 Under Article 7 of Legea nr. 571/2003 privind Codul fiscal (Law No 571/2003 establishing the Tax Code) of 22 December 2003 (Monitorul Oficial al României, Part I, No 927 of 23 December 2003), which was in force until 31 March 2010 (‘Law No 571/2003’), headed ‘Definitions of common concepts’:

‘(1) For the purposes of this Code, … the following definitions shall apply:

…

9. commission – any payment in cash or in kind made to a broker, a general commission agent or any person assimilated to such a broker or general commission agent, for brokerage services performed in connection with a commercial transaction;

…’

13 The wording of that provision was reproduced in point 9 of Article 7(1) of Legea nr. 227/2015 privind Codul fiscal (Law No 227/2015 establishing the Tax Code) of 8 September 2015 (Monitorul Oficial al României, Part I, No 688 of 10 September 2015; ‘Law No 227/2015’), which entered into force on 1 January 2016.

14 Under Article 113 of Law No 571/2003 and Article 221 of Law No 227/2015, headed ‘Taxable persons’ and drafted in identical terms:

‘Non-residents who receive taxable income from Romania shall be liable to pay tax in accordance with this Chapter and are hereinafter referred to as taxable persons.’

15 Article 115 of Law No 571/2003 and Article 223 of Law No 227/2015, headed ‘Taxable income from Romania’, are drafted in the following identical terms:

‘(1) Taxable income from Romania, whether received in Romania or abroad, shall mean the following:

…

(f) commission paid by a resident;

…’

16 Article 116 of Law No 571/2003, headed ‘Withholding of tax on taxable income from Romania obtained by non-residents’, which is reproduced in essence in Article 224 of Law No 227/2015, reads as follows:

‘(1) The tax payable by non-residents on taxable income from Romania shall be calculated, withheld and paid into the State budget by the person paying the income.

(2) The tax payable shall be calculated by applying the following rates to gross income:

…

(d) 16% for all other taxable income from Romania as listed in Article 115.

…’

17 Article 118 of Law No 571/2003, headed ‘Combined application of the provisions of the Tax Code and of the provisions of conventions for the avoidance of double taxation and of EU law’, which are reproduced in essence in Article 230 of Law No...