Opinion of the Advocate General — ECLI:EU:C:2002:737
Date: 2002-12-10
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Germany

summary that the services supplied by the employed psychotherapists would have been exempt from tax if the psychotherapists had supplied them in the course of a self-employed practice. In this connection, the foundation emphasised that irrespective of the existence of a contract of employment the psychotherapists carried out their activity on their own responsibility and applying their expertise independently. 61. The German Government likewise submitted that the psychotherapists employed by the foundation could have provided the same treatment on a tax-exempt basis if they had provided it independently as taxable persons, since psychotherapeutic services of qualified psychologists were medical care within the meaning of Article 13A(1)(c) of the Sixth Directive. 62. Both the Danish Government and the Commission emphasised that the field of application of Article 13A(1)(c) of the Sixth Directive was not restricted to natural persons. 2. Analysis 63. I should like first to observe that I think it necessary to answer the third question irrespective of what the relationship discussed above between the letter (b) tax exemption and the letter (c) tax exemption may be. (22) As the Commission observed, it is for the national court to establish whether the letter (b) tax exemption is available in the present case. 64. However, it appears to be unnecessary to consider the parties' submissions individually, since the answer to the third question may be taken directly from Kügler. (23) 65. By its first question in Kügler, the Bundesfinanzhof asked whether the tax exemption envisaged in Article 13A(1)(c) of the Sixth Directive was dependent on the legal form of the taxable person supplying the medical or paramedical services referred to in that provision. On that point, the Court held that the exemption envisaged in Article 13A(1)(c) of the Sixth Directive is not dependent on the legal form of the taxable person supplying the medical or paramedical services referred to in that provision. 66. The reason the Court gave for its decision was that the wording of Article 13A(1)(c) did not make the tax exemption dependent on whether the taxable person was endowed with a particular legal form. (24) It was enough that medical (or paramedical) services were involved and were supplied by persons who possessed the necessary professional qualifications. The Court also emphasised that such an interpretation was consistent with the objective of reducing the cost of medical care. (25) Finally, the Court stated that such an interpretation was consistent with the principle of fiscal neutrality, which precluded, inter alia, economic operators carrying on the same activities from being treated differently as far as the levying of VAT was concerned. (26) 67. Since it is not disputed in the main proceedings that the qualified psychologists employed by the foundation supply medical care and possess the necessary professional qualifications, it appears that the answer to the first question in Kügler may be applied directly to the present case. C - The fourth question 1. Submissions of the parties 68. The fourth question concerns the potential direct effect of the tax exemptions provided for in letter (b) and letter (c) of Article 13A(1) of the Sixth Directive. 69. The foundation referred in particular to what it considered to be the incorrect transposition of the Sixth Directive in the Federal Republic of Germany. In transposing Article 13A(1)(b) of the Sixth Directive, the national legislature had made the tax exemption subject to an additional condition, namely that the supplies had to be provided under the supervision of a doctor. This gave rise to a difference in treatment between certain medical supplies which were excluded from the tax exemption in the Federal Republic of Germany and identical supplies to which other Member States did grant the exemption, and this infringed the principle of fiscal neutrality. The foundation submitted that national law required to be interpreted in conformity with the Sixth Directive and therefore disregarding the condition it considered to infringe the Sixth Directive. 70. The German Government disputed the proposition that the letter (b) and the letter (c) tax exemptions had direct effect, since neither was, so far as its subject-matter was concerned, unconditional. Letter (b) provided that the tax exemption was dependent on recognition of the establishment concerned by the Member State, and to that extent the Member State accordingly had a margin of discretion. Under letter (c), it was likewise for the Member State to define the scope of the medical and paramedical professions. 71. The Commission considered that the possibility Article 13A(2)(a) of the Sixth Directive granted to the Member States (in particular in relation to letter (b)) of making the grant of the tax exemptions subject to certain conditions did not in principle affect the conclusion that Article 13A(1) had direct effect. Nor did Article 13A(2)(b) of the Sixth Directive preclude Article 13A(1) from having direct effect, since that restriction was contingent in nature and therefore, according to the case-law of the Court, did not prevent direct effect. (27) 72. Moreover, the requirement that the establishment concerned be duly recognised by the Member State did not preclude letter (b) from having direct effect. Once such recognition had been given in an individual case, it was sufficiently clear from that provision what economic activities were covered by the exemption from VAT. 2. Analysis 73. The answer to the fourth question is also to be taken from the judgment in Kügler. (28) Admittedly, that case concerned the direct effect of Article 13A(1)(g) of the Sixth Directive; but the basic issue is comparable in that that provision grants a tax exemption to organisations recognised as charitable by national law. (29) 74. On that point, the Court held that the exemption provided for in Article 13A(1)(g) of the Sixth Directive could be relied upon by a taxable person before national courts in order to oppose national rules incompatible with that provision. 75. The Court started from the proposition that in accordance with settled case-law, wherever the provisions of a directive appear, so far as their subject-matter is concerned, to be unconditional and sufficiently precise, those provisions may, in the absence of implementing measures adopted within the prescribed period, be relied upon as against any national provision which is incompatible with the directive. (30) 76. In order to establish the direct effect of Article 13A(1)(g), the Court said in particular that a Member State could not rely upon its failure to adopt the very provisions which were intended to facilitate the application of the exemption and to which the introductory part of Article 13A(1) of the Sixth Directive referred.(31) The Court also held that Article 13A(1)(g) of the Sixth Directive indicates in a sufficiently precise and unconditional manner the activities to which the exemption applies. (32) 77. The Court then considered the point that the Member State had an undoubted discretion for the purpose of according the organisations in question recognition. In that regard, it stated that as long as the Member States observed the limits of the discretion which was accorded to them by Article 13A(1)(g) of the Sixth Directive, persons could not rely on the Sixth Directive in order to acquire recognition. 78. The Court held that [i]t will accordingly be for the national authorities, in accordance with Community law and subject to review by the national courts, to determine, in the light in particular of practice followed by the competent administrative body in analogous situations, which organisations should be recognised as charitable within the meaning of Article 13A(1)(g) of the Sixth Directive. The Court added that a Member State could grant recognition otherwise than by tax provisions. (33) The possibility under Article 13A(2) of the Sixth Directive of making the grant of the exemptions provided for in Article 13A(1) subject to one or more conditions did not affect the conclusion that Article 13A(1) had direct effect, since that possibility was contingent in nature and a Member State could not rely on its own omission to adopt the measures necessary for laying down such conditions. (34) 79. The Court thus reached the conclusion that the exemption provided for in Article 13A(1)(g) of the Sixth Directive could be relied upon by an individual before national courts in order to oppose national rules incompatible with that provision. At the same time, the Court stated that it was for the national court to establish, in the light of all relevant factors, whether the taxable person was an organisation recognised for the purposes of the particular tax exemption. 80. This reasoning also appears to be applicable to letters (b) and (c), since both tax exemptions indicate in a sufficiently precise and unconditional manner the activities to which the respective exemption applies. From the judgment in Kügler it may also be taken that neither the power of national authorities to recognise the establishments concerned for the purposes of the tax exemption nor the possibility under Article 13A(2) of making the grant of the exemptions referred to in that provision subject to certain conditions is apt to preclude the direct effect of the tax exemptions provided for in Article 13A(1). 81. Accordingly, it is to be held that the exemptions provided for in Article 13A(1)(b) and (c) of the Sixth Directive may be relied upon by a taxable person in order to oppose national rules incompatible with that provision. V - Conclusions 82. It is accordingly submitted that the Court should answer the questions referred as follows: (1) Psychotherapeutic treatment, given in an out-patient facility by a foundation employing qualified psychologists who are licensed medical practitioners but who are not registered as doctors, qualifies as medical care, and therefore not as closely related activities to such care, within the meaning of Article 13A(1)(b) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment. It is for the national court to establish, in the light of all relevant factors, whether the taxable person is a duly recognised establishment of a similar nature within the meaning of Article 13A(1)(b) of the Sixth Directive. (2) The exemption envisaged by Article 13A(1)(c) of the Sixth Directive 77/388/EEC is not dependent on the legal form of the taxable person supplying the medical or paramedical services referred to in that provision. (3) The exemptions provided for in Article 13A(1)(b) and (c) of the Sixth Directive 77/388/EEC may be relied upon by a taxable person in order to oppose national rules incompatible with that provision. 1: - Original language: German. 2: - Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1). 3: - BGBl. I 1979, p. 1953. 4: - Case C-384/98 D v W [2000] ECR I-6795, paragraphs 17 and 18. 5: - Case C-76/99 Commission v France [2001] ECR I-249, paragraph 23. 6: - On this point, it referred to Case 353/85 Commission v United Kingdom [1988] ECR 817, paragraphs 32 and 33, according to services under letter (b) encompassed a whole range of medical care normally provided on a non-profit-making basis in establishments pursuing social purposes, whereas services under letter (c) were provided outside hospitals and similar establishments within the framework of a confidential relationship between the patient and the person providing the care. 7: - Cited above, footnote 5, paragraph 23. 8: - Case C-141/00 Kügler [2002] ECR I-6833, paragraph 25, with further references. 9: - Cited above, footnote 5, paragraph 25. 10: - Case C-349/96 [1999] ECR I-973, paragraph 30. 11: - Case C-2/95 SDC [1997] ECR I-3017, paragraph 20. 12: - D v W (cited above, footnote 4), paragraphs 15 ff. See also my Joint Opinion in Cases C-212/01 Unterpertinger [2003] ECR I-13859 and C-307/01 D'Ambrumenil [2003] ECR I-13989. 13: - D v W, cited above, footnote 4, paragraphs 17 and 18. 14: - Cited above, footnote 8, paragraph 36. 15: - Cited above, footnote 6, in particular paragraph 35. 16: - See Commission v France (cited above, footnote 5), paragraph 23. 17: - Cited above, footnote 8, paragraph 30. 18: - See above, paragraphs 44 f. 19: - Cited above, footnote 8, paragraph 57. 20: - Cited above, footnote 8, paragraph 58. 21: - Letter (g) concerns the supply of services and of goods closely linked to welfare and social security work, and the same question thus arises in its context as to recognition by authorities responsible for the provision of social security as within the context of letter (b). 22: - See above, paragraphs 44 f. 23: - Cited above, footnote 8. 24: - Cited above, footnote 8, paragraph 27. 25: - Cited above, footnote 8, paragraph 29. 26: - Cited above, footnote 8, paragraphs 29 f. 27: - In this regard, the Commission referred to Joined Cases 231/87 and 129/88 Ufficio distrettuale delle imposte dirette di Fiorenzuola d'Arda and Others v Comune di Carpaneto Piacentino and Another [1989] ECR 3233, paragraph 32. 28: - Cited above, footnote 8. 29: - See above, paragraph 52. 30: - Cited above, footnote 8, paragraph 51. 31: - Cited above, footnote 8, paragraph 52, under reference to Case 8/81 Becker [1982] ECR 53, paragraph 33. 32: - Cited above, footnote 8, paragraph 53. 33: - Cited above, footnote 8, in particular paragraph 58. 34: - Cited above, footnote 8, paragraph 60.