Opinion of the Advocate General — ECLI:EU:C:2013:840
Date: 2013-12-12
Language of the case: Danish
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Denmark

Summary — Judgment of the Court (Fifth Chamber), 13 March 2014 1. Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Management of special investment funds — Scope — Pension funds — Conditions (Council Directive 77/388, Art. 13B(d)(6)) 2. Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Management of special investment funds — Concept — Services establishing the rights of pension customers vis-à-vis pension funds — Accounting services — Included (Council Directives 77/388, Art. 13B(d)(6), and 85/611, Annex II) 3. Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Banking transactions — Services establishing the rights of pension customers vis-à-vis pension funds (Council Directive 77/388, Art. 13B(d)(3)) 1. On a proper construction of Article 13B(d)(6) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, pension funds may fall within the scope of that provision if they are funded by the persons to whom the retirement benefit is to be paid, if the funds are invested using a risk-spreading principle, and if the pension customers bear the investment risk. In that regard, it is of little consequence that the contributions are paid by the employer; that the amount paid in is based on collective agreements between labour-market organisations; that there are different ways of paying out the funds invested; that contributions are deductible under income tax law; or that it is possible to add an insurance element which is ancillary to the other services provided. In that regard, the fact that the amount paid into the pension fund is based on collective agreements between labour-market organisations does not alter the fact that the contribution is paid by the worker (or at least in his name and on his behalf), that he will benefit from the proceeds of his investments and that he also bears any risks in that connection. Nor does the fact that the funds accumulated may be paid out as a lump sum or in instalments after the pension customer concerned reaches pensionable age call in question the essential characteristics of the savings invested in pension funds. These merely reflect different ways of calculating the amount to be paid out, and transfers between the various options can be made by means of a simple financial transaction. (see paras 54, 55, 59, operative part 1) 2. On a proper construction of Article 13B(d)(6) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, the term ‘management of special investment funds’ used in that provision covers services by means of which an undertaking establishes the rights of pension customers vis-à-vis pension funds through the opening of accounts in the pension scheme system and the crediting to such accounts of the contributions paid. That term also covers accounting services and account information services such as those listed in Annex II to Directive 85/611 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS), as amended by Directives 2001/107 and 2001/108. The wording of Article 13B(d)(6) of the Sixth Directive does not in principle preclude the management of special investment funds from being broken down into a number of separate services which may come within the meaning of the term ‘management of special investment funds’ as used in that provision, and may benefit from the exemption under it, even where they are provided by a third-party manager. In particular, management services provided by a third-party manager must, viewed broadly, form a distinct whole and be specific to, and essential for, the management of special investment funds. Functions specific to UCITS include, besides portfolio management functions, functions for administering the UCITS themselves, such as those set out — under the heading ‘Administration’ — in Annex II to Directive 85/611. However, the fact that services are not listed in Annex II to Directive 85/611 does not preclude their inclusion in the category of specific services falling within activities for management of special investment funds, since Article 5(2) of that directive itself emphasises that the list in that annex is not exhaustive. Moreover, the fact that services provided by a third party do not alter the fund’s legal and financial position does not preclude them from being covered by the concept of ‘management’ of a special investment fund. If such services were to be made subject to value added tax when provided by a third party, that would give pension funds which have decided to record themselves the contributions made by pension customers an advantage over those which have decided to make use of a third party for that purpose, even though subcontracting such services could provide advantages in terms of efficiency to pension funds and thus to their customers. (see paras 63-67, 69, 72, 76, operative part 2) 3. On a proper construction of Article 13B(d)(3) of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, the VAT exemption laid down in that provision for transactions concerning payments and transfers covers services by means of which an undertaking establishes the rights of pension customers vis-à-vis pension funds through the creation of accounts for those customers within the pension scheme system and the crediting to those pension customers’ accounts of the contributions paid, and any transactions which are ancillary to those services or which combine with those services to form a single economic supply. A transfer is a transaction consisting in the execution of an order for the transfer of a sum of money from one bank account to another. It is characterised in particular by the fact that it involves a change in the legal and financial situation existing, on the one hand, between the person giving the order and the recipient and, on the other, between those parties and their respective banks; and, in some cases, between those banks. Moreover, the transaction which produces the change is solely the transfer of funds between accounts, irrespective of its cause. However, that interpretation does not presuppose any particular method for effecting transfers, which may be done using accounting entries. That is so in the case of transfers between customers of a single bank, or between accounts of a single individual who acts as both the person giving the order and the recipient. (see paras 79, 80, 85, operative part 3)