Opinion of the Advocate General — ECLI:EU:C:2020:496
Date: 2020-06-25
Language of the case: English
Subject matter: Taxation
Procedure: Reference for a preliminary ruling
Origin: United Kingdom

summary
19. In summary, WTL’s case is that:
i. Article 44 PVD provides that the place of supply of services is the place of the 
recipient’s establishment when those services are received by a “taxable person
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actine as such”. The requirement in Article 44 is concerned with the capacity in 
which the recipient receives the services. It is not sufficient that the recipient ‘he’ a 
taxable person; it must also be ‘acting as’ a taxable person.
ii. In Case C-155/94 Wellcome Trust Ltd v Commissioners of Customs and Excise3 the 
CJEU held that, when it engaged in its investment activities, WTL was not a “taxable 
person acting as such'’ within the meaning of what is now Article 2(1 )(c) PVD.
iii. The words “taxable person acting as such” appearing in Article 44 PVD must, in the 
absence of an express provision to the contrary, be given the same effect and meaning 
as those same words appearing in Article 2(1) PVD.
iv. WTL’s construction of Article 44 gives effect to the context and objectives of the 
legislation by ensuring consistency and simplicity.
a) It ensures that services received by taxable persons whether for private 
use or non-economic use are treated in the same way;
b) It ensures that services received by persons for private or non-economic 
use are treated in the same way irrespective of whether those persons 
happen also to be registered for VAT in respect of unrelated taxable 
activities;
c) It ensures that the rules on the place of supply of services align with the 
rules on the intra-community acquisition of goods, which draw no 
distinction between services received by taxable persons for private or 
non-economic use.
v. The European Union institutions considered at some length whether distinctions 
should be drawn between private and non-economic use by taxable persons and 
concluded that they should not. The words “acting as such” were deliberately 
introduced into Article 44 after detailed consideration of the scope and application of 
the rules governing the place of supply of services. (See COM(2003) 822, 23
3 Wellcome Trust Case C-155/94, ECLI:EU:C: 1996:243
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December 20034; FISC 78, 1 April 2004, at pp. 16-175; FISC 116, 28 May 2004, at 
p. 66; FISC 144, 8 July 2004 at p. 4; FISC 150, 4 August 2004, at p. 67; FISC 42, 16 
March 2006 at page 78).
vi. The effect of HMRC’s arguments is to reverse the clear policy choices agreed by the 
EU legislature.
vii. Article 55 of the Implementing Regulation requires WTL to provide its VAT number 
to suppliers “when acting as” a taxable person. WTL has not provided its VAT 
number to suppliers because it is not “acting as" a taxable person in receiving the 
disputed services. Though this appeal is concerned exclusively with the receipt of 
services from non-EU suppliers, EU-based suppliers of services would be justified in 
charging VAT in their own jurisdiction to WTL on the basis of this Article. There is, 
therefore, no risk of non-taxation.
viii. In Case C-291/07 Kollektivavtalsstiftelsen TRR Trygghetsradet9 (“TRR") the 
CJEU emphasised the significance and import of the words “taxable person acting 
as such" as appearing in Directive 77/388/EEC (the “Sixth Directive”) and decided 
the case before it on the basis that those words “acting as such” were absent from 
Article 9(2)(e) of the Sixth Directive.
ix. Like the other provisions of the Sixth Directive considered by the CJEU in TRR, 
Articles 2(1) and 17(2)10, Article 44 of the VAT Directive also indicates that a 
condition that the recipient uses those services for the purposes of its economic 
activity must be satisfied in order for it to apply. According to HMRC’s argument 
however, the words “acting as such” in Article 44 are meaningless.
4 COM/2003/0822 Final, 23 December 2003, ‘Proposal for a Council Directive amending Directive 77/388/EEC 
as regards the place of supply of services’
5 Council of the European Union Interinstitutional File 2003/0329 (CNS), ST 8057 2004 1N1T (FISC 78)
6 Council of the European Union Interinstitutional File 2003/0329 (CNS), ST 9961 2004 INIT (FISC 116)
7 Council of the European Union Interinstitutional File 2003/0329 (CNS), ST 11857 2004 INIT (FISC 150)
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Council of the European Union, 16 March 2006, ‘Amended proposal for a Council Directive amending 
Directive 77/388/EEC as regards the place of supply of services and Regulation (EC) No 1798/2003 as regards 
the exchange of information’, ST 7512 2006 INIT (FISC 42)
9 Kollektivavtalsstiftelsen TRR Trygghetsradet) Case C-291/07, ECLI:EU:C:2008:348 (opinion) at paragraph 40 
and ECLI:EU:C:2008:609 (judgment) at paragraphs 28 and 29
10 The relevant current provisions are Articles 2(1 )(c) and 168 of the PVD.
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x. It would breach the principle of equal treatment to treat WTL differently from (a) 
another charity which purchases exactly the same services but is not registered for 
VAT because it does not engage in any incidental (and unconnected) taxable activity; 
and/or (b) a person engaged in private use of the relevant services (whether or not 
registered for VAT). This latter breach would be particularly egregious in 
circumstances where WTL was held by the ECJ to be engaged in non-economic 
activity precisely because its activities were to be equated to those of a private 
investor11.
xi. Article 43 does not undermine or contradict any of the foregoing propositions. That 
article has a single stated purpose, namely to determine the status of a person. Article 
43 confirms that a taxable person who carries out activities or transactions that are 
not considered to be taxable supplies of goods or services in accordance with Article 
2(1) of the VAT Directive is, nonetheless, to be regarded as having the status of being 
a taxable person insofar as that activity is concerned. In accordance with Article 43, 
WTL has the status of taxable person. Whilst the CJEU confirmed this to be the case 
in any event in TRR, that judgment was published well after the terms of Articles 43 
had been finalised.12
xii. Article 43 cannot be read as deeming the recipient to be “acting as” a taxable person 
for the purposes of Article 44 (as the Respondents contend) for a number of reasons:
a) Articles 17 to 19, and 55, of the Implementing Regulation confirm that 
Article 43 PVD is concerned with ‘status’ and Article 44 with ‘capacity’;
b) Article 19 of the Implementing Regulation confirms that a taxable person 
who engages in private use is to be regarded as a non-taxable person. That 
article does not refer to (non-private) non-economic use and simply has 
no application to WTL’s supplies;
c) Article 43 does not distinguish between different types of non-economic 
activity (whether private or business) and it is therefore incapable of 
importing such distinctions into Article 44;
11 See Wellcome Trust Case C-155/94, ECLI:EU:C:1996:243 at paragraphs 36 to 39
12 Directive 2008/8/EC, though it became effective on 1 January 2010, was adopted on 12 February 2008. The 
Judgment of the CJEU in TRR was not delivered until 6 November 2008.
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d) The proposal for Article 43 (COM(2003) 822) expressly excluded private 
use from the scope of Article 43. The subsequent removal of that 
exclusion proves (a) that private use is included in article 43 and (b) that 
the European Council consciously and deliberately decided to treat a 
person as a taxable person whether or not they were also conducting 
private activities alongside their economic activity;
e) Article 55 of the Implementing Regulation only requires a purchaser to 
provide its VAT number to suppliers “when acting as” a taxable person. 
WTL has not provided its VAT number to its suppliers, nor should it, 
because it is not “acting as” a taxable person when doing so.
f) Article 18(2) of the Implementing Regulation allows a supplier to 
assume that the recipient is a non-taxable person for the purposes of 
Article 45 PVD where that purchaser has not communicated its VAT 
number. In the case of an intra-EU supply of services, the application of 
Article 18(2) results in the place of supply of services to a taxable person 
acting in a non-economic capacity being determined in accordance with 
Article 45 where that person has not supplied its VAT number to the 
supplier.
g) For the foregoing reasons, there is no risk of the non-taxation of intra-EU 
supplies under WTL’s and the First-tier Tribunal’s analysis13 of the 
relevant legislation. However, HMRC’s proposed position would in fact 
entail double taxation in an intra-EU context because the supplier would 
be required to treat the place of supply as being where they are established 
(pursuant to Article 18(2) Implementing Regulation and consequently 
Article 45 of the PVD). At the same time, under HMRC’s proposed 
position, a recipient who is a taxable person would also be required, under 
Article 44 PVD, to treat the same supplies as taking place where they are 
established.
h) HMRC’s construction of Articles 43 and 44 would place WTL in a 
uniquely invidious position. Were its share-dealing activities economic
13 Ibid, at paragraphs 25 to 29
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in nature, it would be liable to self-account for VAT on the purchase of 
services from outside the EU but it would consequently enjoy the right to 
deduct all such input VAT incurred pursuant to Articles 135(l)(f) and 
169 PVD as the counterparties to its share transactions are based outside 
the EU. If WTL was purchasing the services for private use it would have 
no obligation to self-account for VAT on the purchase of services from 
non-EU suppliers and so the question of VAT deduction would not arise. 
WTL is said, however, to be required to self-account for VAT as though 
it were engaged in economic activity but to be denied input tax deduction 
on the basis that it is carrying out an activity equivalent to that of a private 
individual. There is nothing in the legislation to suggest that charitable 
bodies were intended to be penalised in this way.
xiii. HMRC’s reliance on the Recitals of Directive 2008/8/EC and the Implementing 
Regulation to support their construction of Articles 43 to 45 is misplaced. The travaux 
preparatoires highlighted in paragraph 22(v) above demonstrate that the EU 
legislature considered at some length which conditions must be satisfied in order for 
the place of supply to be the location of the customer under Article 44. It was agreed 
by the EU legislature after detailed consideration that the material condition in Article 
44 should be “acting as such”, in order to align the rules on the place of supply of 
services with the rules applicable to the intra-Community Acquisition of goods. It is 
clear that the recitals were not amended to take account of the substantive and 
carefully considered changes made to Articles 43 and 4414. In any event, the recitals 
are clearly not the law nor can they override the clear terms of the PVD itself (as 
affirmed by the CJEU in Skatteverket v Srf konsulterna AB (Case 647/17))15.
HMRC’s arguments in summary
27. In summary, HMRC contend as follows:
1. It is agreed between the parties that WTL is a taxable person within Articles 2 and 9 of 
the Directive. Although it is not a taxable person "acting as such' within Article 2( 1) of
14 Council of the European Union Interinstitutional File 2003/0329 (CNS), ST 11439 2005 INIT (FISC 86) [22 
July 2005]; Council of the European Union Interinstitutional File 2003/0329 (CNS), ST 16112 2005 INIT (FISC 
167) [23 December 2005]
15 Skatteverket v Srf konsulterna AB Case 647/17 , ECLI:EU:C:2019:195
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the Directive, it is engaged in a business activity, rather than a private activity, when it 
receives the Services (Case C-515/07 Vereniging Noordelijke Land- en Tuinbouw 
Organisatie v Staatssecretaris van Financien EU:C:2009:88). There is an express 
distinction drawn between private and business activity in Article 19 of the 
Implementing Regulation.
2. The place of supply of the Services must fall within Article 44 for two key reasons. 
First, interpreting Article 44 to include the supplies of Services to WTL is the only 
interpretation that is in accordance with the objectives of the place of supply rules. 
Secondly, the interpretation accords with the recitals and related provisions in the 
Directive, Directive 2008/9 and the Implementing Regulation.
3. As to the objectives of the place of supply rules, the general principle that the place of 
supply is the place of consumption and that VAT is in principle owed to the member 
state in which the service is consumed (Case C-605/12 EU:C:2014:2298 Welmory sp 
z.u.o Advocate General paragraphs 22-30) supports the view that the place of supply 
should be the UK, where WTL is established.
4. More importantly still, a key objective of the rules is that they should identify with legal 
certainty the place of supply for the avoidance of non-taxation and double taxation and 
the identification of the entitlement of any Member State to VAT on a supply (Welmory 
in particular paragraphs 39-46 and 54-56 of the CJEU judgment; Case C-37/08 RCI 
Europe v Commissioners for Her Majesty’s Revenue and Customs EU:C:2009:507 AG 
Opinon at EU:C:2009:226 paragraphs 48-50; and Case 647/17 Skatteverket v Srf 
konsulterna AB EU:C:2019:195 paragraphs 28-29). WTL does not claim that Article 
45 applies to the Services (nor could it, given that WTL is a taxable person and one 
who is not acting for a private purpose) or that the relevant supplies are such as to fall 
within the particular provisions within Articles 46 to Articles 59 of the Directive. It 
follows from this that WTL's position is in fact that none of the place of supply rules 
apply: neither Article 44, nor 45, nor any of the particular provisions. It is wholly 
contrary to the key aim of legal certainty that a supply should have no place of supply 
at all. That a supply must fall within one of the place of supply rules is confirmed by 
Case 647/17 Skatteverket v Srf konsulterna AB EU:C:2019:195 paragraph 21.
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5. Nor is it possible to argue that Article 18 of the Implementing Regulation means that 
there is no uncertainty. It is of particularly limited application. All that Article 18 does 
is allow a supplier to assume when a customer has not provided an identification 
number that he is dealing with a taxable person “[ujnless he has information to the 
contrary’’. Thus, it cannot provide any certainty at all where a supplier knows that WTL 
is in fact a taxable person and yet one who has not supplied an identification number. 
The place of supply rules are intended to, and should as far as possible be interpreted 
to, provide certainty as to the place of supply so that (i) taxable persons know which 
rules apply, (ii) Member States know whether they are entitled to VAT and (iii) so that 
the appropriate Member State benefits from the relevant taxation. Only HMRC’s 
position achieves all three.
6. As to the related recitals and provisions:
(a) Article 43 states that a taxable person who also carries out activities that are not 
considered to be taxable supplies of goods or sendees in accordance with Article 
2(1) shall be regarded as a taxable person in respect of all services rendered to him. 
This article does not extend the Article 45 category, as that relates only to non- 
taxable persons. Its role can only be to widen Article 44, or at least to clarify that 
those taxable persons falling within Article 43 must be regarded as also falling 
within Article 44 when they are in the position of receiving supplies. WTL’s 
position renders Article 43 meaningless: WTL says both that Article 43 grants only 
a certain status and also that this status is of no effect. Further, Advocate General 
Mazak in Case C-291/07 Kollektivavtalsstiftelsen TRR Trygghetsradet16 stressed 
the importance of the place of supply rules’ providing legal certainty, being 
predictable and reducing the burden on traders. In that regard, he noted the present 
rules (which were not applicable in that case) and stressed that Article 43 now 
provides that those who also carry out activities not considered to be taxable 
supplies under Article 2(1) shall be regarded as taxable persons in respect of 
supplies to them (paragraph 44). This accords only with HMRC’s position.
16 Kollektivavtalsstiftelsen TRR Trygghetsradet) Case C-291/07, ECLI:EU:C:2008:348 (opinion) and 
ECLI:EU:C:2008:609 (judgment).
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(b) Article 44 uses the term ‘acting as such’ only to exclude from its scope those acting 
in a private capacity. This is made clear by Article 19 of the Implementing 
Regulation which states that a taxable person who receives services exclusively for 
private use shall be regarded as a non-taxable person. The clear implication is that 
other taxable persons (such as WTL, who it is agreed receives the Services for a 
non-private business use) shall still be regarded as a taxable person. This is also 
reflected in recital 19 of the Implementing Regulation which states that when 
services supplied to a taxable person are intended for private use the taxable person 
cannot be “deemed to be acting in his capacity as a taxable person". Again, the 
implication is that in other cases, taxable persons are indeed deemed to be ‘acting’ 
as taxable persons, i.e. to be taxable persons acting as such and therefore within 
Article 44. Contrary to WTL’s claim therefore, HMRC’s position does not render 
the term ‘acting as such' meaningless and in fact makes sense of Articles 43 and 44 
and the relevant provisions in the Implementing Regulation.
(c) As with Article 43, being regarded as a taxable person, must mean being regarded 
as a taxable person acting as such within Article 44. The only options the rales 
provide are that a customer is a taxable person acting as such or a non-taxable 
person. It follows that as WTL is not the latter, it must be the former.
(d) The recital to Directive 2008/08 which introduced the relevant place of supply rales 
made clear (i) that the general rale for supplies of services should be that these 
should be based on the place where the recipient is established; (ii) that taxable 
persons who also have non-taxable activities should be treated as taxable persons 
when they are customers in receipt of supplies (recital 4); and only refer to the place 
of supply being the place where the supplier is established in cases where supplies 
are made to non-taxable persons (recital 5). All three of these aims are met only by 
the view that the Services fall within Article 44.
(e) Article 55 of the Implementing Regulation in relation to transactions in Article 262 
of the Directive, requires taxable persons when acting as such, to communicate their 
VAT identification number to their supplier. In relation to services, Article 262 
refers to a supplier submitting a recapitulative statement of taxable person 
customers in relation to services for which the recipient is liable to pay the tax
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pursuant to Article 196. Article 196 in turn refers to Article 44. Thus, Article 55 
must be applied in light of tire position in Article 44. WTL should accordingly 
provide its identification number when its supplier is in another Member State as 
WTL is a taxable person acting as such within Article 44 and Article 55. That a 
supplier may assume (unless it has information to the contrary) that a customer who 
has not provided its number is a non-taxable person is not of course a basis for 
arguing that the customer is indeed a non-taxable person or for denying that it 
should provide its number. On HMRC’s interpretation of the position. WTL would 
accordingly come within Article 55 and provide its number so that its supplier 
would properly assume that the reverse charge applies. Contrary to WTL’s claim 
therefore, there is no risk of double taxation on HMRC’s account.
(f) WTL apparently accepts that there must be a place of supply in every case, 
including in this one, but considers that a supplier can assume under Article 18 of 
the Implementing Regulation that Article 45 applies where WTL does not provide 
its identification number. In fact, as noted above, that assumption is of limited 
application. The supplier cannot make that assumption where it has information to 
the contrary and therefore will (unsurprisingly) still need to be able to identify the 
place of supply, as will the Member States authorities. The risk of non-taxation of 
course arises precisely if the rules do not identify in each case the place of supply. 
HMRC’s position ensures that this is identified in every case; WTL’s position 
provides no answer to the key question where is the place of supply for the Services.
7. The Travatix Preparatoires do not in fact support the view that Article 44 only includes 
within its scope supplies received by those acting as taxable persons within Article 2(1). 
Indeed, the first introduction of the words 'acting as such’ in Council of the European 
Union Interinstitutional File: 2003/0329 (CNS) 8057/04 COR l(en) FISC 78 was in 
substitution of the phrase ‘other than services supplied to him for his own private use’. 
Further, WTL places reliance on FISC 144, 8 July 2004 and FISC 150, 4 August 2004 
but omits reference to FISC 197, 8 October 2004 in which the phrase 'acting as such’ 
was in fact deleted from the text thus rendering any prior inclusion redundant. Further, 
WTL is simply wrong to claim that ‘private use’ must be included in Article 43 because 
of the removal of the words “except for his own private use or that of his staff* from an 
earlier draft form of Article 9. First, this last phrase can of course be merely
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clarificatory. And secondly, and in any event, as the exception was in fact removed, 
with it was gone any implication WTL hopes to read into the temporary inclusion of 
the exception.
8. There is no basis for WTL to complain about claimed unequal treatment, ft cannot claim 
a deduction of tax because it does not use the relevant Sendees to make taxable supplies. 
WTL also cannot complain that it is not being treated in the same way as a private 
person; WTL accepts that it is acting in a business capacity when it receives the 
Services, that its main business is of investments. Any different treatment of private 
persons is expressly supported by Article 19 of the Implementing Regulation. 
Furthermore, by virtue of the fact that WTL is a taxable person, it of course can claim 
some deduction of VAT on its overheads and that is a key benefit not open to a private 
investor. It is open to WTL to structure its business in a different way; but while it 
chooses to be a taxable person who also carries out activities that are not taxable 
supplies within Article 2(1), it is to be regarded as a taxable person within Article 44 as 
required by Article 43, Article 44 and Article 19 of the Implementing Regulation.
9. HMRC say that the answer to the question should therefore be as follows:
If none of the specific rules of place of supply in Articles 46 to 59 apply, a supply must 
tall wdthin either Article 44 or Article 45 as there must be a certain place of supply and 
where a taxable person receives a supply and uses it for non-private business purposes, 
that person is a taxable person acting as such within the meaning of Article 44 of the 
Directive.
The reasons why a preliminary ruling is sought
28. The parties and the Upper Tribunal note that there is no UK or CJEU case law which 
considers the meaning of the words “acting as such” in Article 44 of the Directive, which
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is the central issue in dispute. A preliminary ruling from the CJEU is therefore necessary 
to enable the Upper Tribunal to give judgment.
TIMOTHY HERRINGTON
Judge of the Tax and Chancery Chamber of the Upper Tribunal of the United 
Kingdom
Date: 13 June 2019
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