Opinion of the Advocate General — ECLI:EU:C:2006:172
Date: 2005-03-17
Language of the case: Italian
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Taxation;Value added tax
Procedure: Reference for a preliminary ruling
Origin: Italy

summary publication), the Court repeated the same ruling as in Bergandi (cited in footnote 5), with regard to the same tax; the tax in issue in Dansk Denkavit (cited in footnote 16) was also subsequently the subject of infringement proceedings in Case C‑234/91 Commission v Denmark [1993] ECR I-6273, in which the Court followed the same reasoning; and in Case C-28/96 Fricarnes [1997] ECR I-4939, paragraph 34 et seq., the Court followed the same reasoning as in UCAL (cited in footnote 20), decided on the same day, with regard to a similar levy. 12 – Case 295/84 [1985] ECR 3759, especially paragraphs 14 to 17. 13 – Cited above in footnote 5, paragraphs 6 to 20. 14 – Joined Cases 93/88 and 94/88 [1989] ECR 2671, paragraphs 6 to 21. 15 – Case C-109/90 [1991] ECR I-1385, especially paragraph 14. 16 – Case C-200/90 [1992] ECR I-2217. 17 – Case C-347/90 [1992] ECR I-2947. 18 – Case C-208/91 [1992] ECR I-6709. 19 – Cited above in footnote 5. 20 – Case C-347/95 [1997] ECR I-4911, paragraph 30 et seq. 21 – Case C-130/96 [1997] ECR I-5053. 22 – Case C-318/96 [1998] ECR I-785. 23 – Joined Cases C-338/97, C-344/97 and C-390/97 [1999] ECR I-3319. 24 – Case C-437/97 [2000] ECR I-1157, especially paragraphs 19 to 25. 25 – Case C-101/00 [2002] ECR I-7487, especially paragraphs 91 to 107. 26 – Case C-308/01 [2004] ECR I-4777, especially paragraphs 23 to 37. 27 – Rousseau Wilmot, paragraph 13; Wisselink, paragraph 8; see also the preamble to First Council Directive 67/227/EEC of 11 April 1967 on the harmonisation of legislation of Member States concerning turnover taxes (OJ, English Special Edition 1967, p. 14, hereinafter ‘the First Directive’), eighth recital. 28 – Bergandi, paragraph 7; SPAR, paragraph 17; Pelzl, paragraph 14; see also the preamble to the First Directive, first and second recitals. 29 – Bergandi, paragraph 9; SPAR, paragraph 19; Pelzl, paragraph 18. 30 – Rousseau Wilmot, paragraph 16; Bergandi, paragraph 14; Wisselink, paragraph 17; Dansk Denkavit, paragraph 11; Bozzi, paragraph 9; Beaulande, paragraph 12; Careda, paragraphs 13 and 24; UCAL; paragraph 33; Solisnor, paragraph 13; EKW, paragraph 20. 31 – Paragraph 19. 32 – Rousseau Wilmot, paragraph 15; Bergandi, paragraphs 8 and 15; Wisselink, paragraph 18; Giant, paragraph 12; SPAR, paragraph 23; Pelzl, paragraph 16. 33 – That summary is based on Pelzl, paragraphs 20 and 21. The substance of the characteristics has remained constant, although there are slight differences in the precise formulation: see Dansk Denkavit, paragraph 11; Bozzi, paragraph 12; Beaulande, paragraph 14; Careda, paragraph 14; UCAL, paragraph 34; Solisnor, paragraph 14; EKW, paragraph 22; Tulliasiamies, paragraph 99; and GIL Insurance, paragraph 33. 34 – See Bergandi, paragraph 14; Giant, paragraph 11; SPAR, paragraph 22; Pelzl, paragraph 20. 35 – See point 22 above and the case-law cited there. 36 – Dansk Denkavit, paragraph 14; Careda, paragraph 14; Solisnor, paragraph 14; SPAR, paragraph 22; EKW, paragraph 21; GIL Insurance, paragraph 32. 37 – Paragraph 15 and ruling. It should be noted however that not all of those features were considered relevant in the Court’s analysis; see point 28 and footnotes 50 and 52 to 54 below. 38 – At paragraph 15. 39 – At paragraphs 18 and 19. 40 – At paragraphs 24 and 25. 41 – Rousseau Wilmot, paragraph 16; Giant, paragraph 14; Pelzl, paragraphs 24 and 25. 42 – Bergandi, paragraph 16 et seq.; Wisselink, paragraph 20. 43 – Beaulande, paragraph 18; UCAL, paragraph 36; GIL Insurance, paragraph 36. 44 – Wisselink, paragraph 20; Bozzi, paragraph 16; Beaulande, paragraph 17; UCAL, paragraph 36; Pelzl, paragraph 23. 45 – Bozzi, paragraph 15; UCAL, paragraph 36; Tulliasiamies, paragraph 102. 46 – Bozzi, paragraph 16; Beaulande, paragraph 17; UCAL, paragraph 36; SPAR, paragraph 27; Tulliasiamies, paragraph 103; GIL Insurance, paragraph 36. 47 – At paragraphs 11 and 12. 48 – SPAR, paragraphs 25 and 26. 49 – Wisselink, paragraph 10; Careda, paragraph 17; Tulliasiamies, paragraph 98. 50 – Giant, paragraph 9; Dansk Denkavit, paragraph 15; SPAR, paragraph 21. 51 – Careda, paragraph 18. 52 – Dansk Denkavit, paragraph 15; Careda, paragraphs 23 and 25. 53 – Dansk Denkavit, paragraph 15. 54 – Ibid. 55 – Finland, France, Hungary, Italy and Spain. 56 – See Article 12(3)(a) of the Sixth Directive. The Commission has on several occasions proposed a maximum rate but the proposal has not been accepted, although a de facto maximum of 25% applies, perhaps for practical reasons related to the increased likelihood of fraud when tax rates rise. 57 – See also the Opinion of Advocate General Tesauro in Dansk Denkavit (point 8, sixth paragraph, at p. I-2235). 58 – At points 24 and 25 of his Opinion. 59 – Although it appears from paragraphs 11 and 12 of Wisselink that this conclusion is not absolute, and even a single-stage tax may in some cases prevent the proper working of the common VAT system. 60 – There is however a suggestion in Bergandi, at paragraph 17, that a fixed-rate tax based on an objective evaluation of foreseeable receipts might be caught if passed on to the consumer. 61 – In particular in Article 13(B)(d). 62 – Reports have been commissioned by the Commission on the application of VAT to financial services, including bank transactions; a 1996 study by Ernst & Young is available on the Commission’s website. 63 – Compare points 39, 40 and 53 of Advocate General Jacobs’s Opinion in the present case. 64 – See the case-law cited in point 16 above. The Court has of course taken account of the possibility of passing on the burden of the tax, which is a feature of indirect taxation, but only for the purposes of comparison with VAT, not in order to establish a categorisation as direct or indirect. 65 – Eighteenth Council Directive 89/465/EEC of 18 July 1989 on the harmonisation of the laws of the Member States relating to turnover taxes – Abolition of certain derogations provided for in Article 28(3) of the Sixth Directive (OJ 1989 L 226, p. 21). 66 – Thirteenth Council Directive 86/560/EEC of 17 November 1986 on the harmonisation of the laws of the Member States relating to turnover taxes – Arrangements for the refund of value added tax to taxable persons not established in Community territory (OJ 1986 L 326, p. 40); although the VAT directives are numbered sequentially, not all those in the sequence have been adopted in fact (or in sequential order). 67 – See point 27 and footnote 41 above. It may be noted that, unlike Dansk Denkavit, all of those judgments were delivered by a chamber of the Court. 68 – The French and Hungarian Governments have made similar submissions. 69 – See point 105 et seq. below. 70 – See in particular Pelzl, paragraph 27; see also, with regard to the compatibility of a locally-levied tax with the prohibition of charges having an effect equivalent to that of a customs duty on exports, Case C-72/03 Carbonati [2004] ECR I-8027, paragraph 27 et seq. 71 – See paragraph 27 above, footnotes 41 and 45. 72 – At paragraph 18 of the judgment. 73 – With the perhaps unfortunate and minor exception of exempt transactions, if they form inputs for the purpose of further onward supplies. 74 – The possible exceptions are Rousseau Wilmot and SPAR, in neither of which the Court explicitly referred to the four ‘essential characteristics’. 75 – See point 96 above. 76 – In a number of judgments from Case 34/86 Council v Parliament [1986] ECR 2155, paragraph 48, to Case C-445/00 Austria v Council [2003] ECR 8549, paragraphs 103 to 106. 77 – In a number of judgments from Case 81/72 Commission v Council [1973] ECR 575 to, most recently, Case C-178/03 Commission v Parliament and Council [2006] ECR I-0000. 78 – See in particular the first three cases in which the Court used this possibility: Case 4/79 Providence Agricole de la Champagne [1980] ECR 2823, paragraphs 42 to 46, Case 109/79 Maïseries de Beauce [1980] ECR 2883, paragraphs 42 to 46, and Case 145/79 Roquette Frères [1980] ECR 2917, paragraphs 50 to 52. 79 – See for example Case 41/84 Pinna [1986] ECR 1, paragraphs 26 to 30; Case C-228/92 Roquette Frères [1994] ECR I-1445, paragraphs 17 to 30. 80 – Case 300/86 Van Landschoot [1988] ECR 3443, paragraphs 22 to 24. 81 – Joined Cases 117/76 and 16/77 Ruckdeschel [1977] ECR 1753, and Joined Cases 124/76 and 20/77 Moulins Pont-à-Mousson [1977] ECR 1795. 82 – From, first and most famously, Case 43/75 Defrenne II [1976] ECR 455, paragraphs 69 to 75, to, most recently for the time being, EKW, cited in footnote 24, paragraphs 57 to 60. 83 – For example Case C-262/88 Barber [1990] ECR I-1889, which also illustrates the fact that serious difficulties are not sufficient to justify a temporal limitation: after noting in paragraphs 40 and 41 the very large number of workers who might be entitled to claim equal treatment on the basis of the Treaty interpretation given, the Court went on in paragraphs 42 and 43 to verify that Member States had been reasonably entitled to consider that another interpretation was possible. 84 – At a national level, the normal temporal effects of a ruling of incompatibility are also either ex tunc (the general rule, for example, in the courts of Belgium, France, Germany, Ireland, Italy, Spain, Poland and Portugal) or ex nunc (the general rule, for example, in some, if not all, courts of Austria, the Czech Republic, Greece, Hungary, and Slovenia; in the case of at least Greece and Slovenia, the judgments of some other courts normally have ex tunc effects), with an apparent preponderance of ex tunc. 85 – At a national level, a similar practice may be followed, whether the basic effect is ex tunc or ex nunc. Generally, in the interests of legal certainty, ex tunc effects may be relied upon only in proceedings which have been or may still be brought within the relevant procedural time-limits, although in some jurisdictions the effect may be formally restricted to the instant case because the court has no competence to annul a legislative measure, only to disapply it (the general rule, for example, in the courts of Denmark, Finland, Luxembourg, Sweden and the United Kingdom). Where ex nunc effects are concerned, an exception is commonly made for proceedings which at the date of the judgment have been or may still be brought within the relevant procedural time-limits; for those which at that date have already been brought; or for those which actually gave rise to the judgment. 86 – Case C-292/04. 87 – Case C-35/98 [2000] ECR I-4071. 88 – At point 43 et seq. 89 – Cases in which national courts will annul a legislative measure with effect from a specific date in the past appear to be rare. 90 – They include Austria, Belgium, the Czech Republic, Germany, Hungary, Poland, Slovenia and Spain. In other systems, there are fundamental objections to this approach, also described as ‘prospective’. As Lord Nicholls of Birkenhead explained recently in National Westminster Bank v Spectrum Plus [2005] UKHL 41: ‘The essence of the principled argument against prospective overruling is that in this country prospective overruling is outside the constitutional limits of the judicial function. It would amount to the judicial usurpation of the legislative function.’ 91 – Namely, where an existing legislative rule of general application is declared incompatible with a higher norm; it will rarely if ever be possible to find a wholly similar situation, in which the court finding the incompatibility refers the case back to another court for a ruling on validity. 92 – The period between the date of the judgment and the date from which it may be relied on is sometimes referred to as ‘transitional’. It should be noted however that this is a misnomer; the contested national measure is invalid and must be replaced with effect from a specific date. 93 – See, for example, Case C-265/01 Pansard [2003] ECR I-683, paragraph 18; see also the Court’s information note on references from national courts for a preliminary ruling (OJ 2005 C 143, p. 1), point 6. 94 – See also, most recently, Case C-402/03 Skov [2006] ECR I-0000, paragraph 51. 95 – The fact that here the grounds for the Italian Government’s belief lie in the Commission’s assurance is of course not decisive; good faith could also be based on misleadingly drafted legislation, or indeed obscure case-law. 96 – This compares with a figure of between EUR 5 and 13 billion in Germany in the Meilicke case; see point 35 of the Opinion. 97 – Banca Popolare originally brought its action in 2001 and the reference was made in late 2003. 98 – See Legge delega per la riforma del sistema fiscale statale (L. 7/4/03, n. 80) in GURI No 91 of 18 April 2003, in particular Articles 8 and 10(4), (5) and (7) thereof. 99 – There are precedents in (at least) the German Bundesverfassungsgericht and the Belgian Cour d’Arbitrage for the choice of a future date corresponding to the end of a relevant current period, such as calendar year, tax year or academic year. 100 – See for example Case C-147/01 Weber’s Wine World [2003] ECR I-11365, paragraph 93 and the case-law cited there. 101 – OJ 2004 C 21, p. 16. 102 – See point 62 of the Opinion. 103 – See my remarks at point 159. 104 – The earlier statement of the Commission’s views, whether in its written observations, which are not made public, or even at the hearing, might also have been considered, but that cannot in my view be compared to the first public indication, in written, reasoned and generally available form, of the views of a Member of the Court. 105 – Cited in footnote 100, paragraphs 93 to 102. 106 – See EKW, paragraph 57, and the case-law cited there.