No C 252/2 Official Journal of the European Communities 22.9. 87 
II 
(Preparatory Acts) 
COMMISSION 
Proposal for a Council "Directive completing and amending Directive 7 7/3 8 8/EEC 
— Removal of fiscal frontiers — 
COM(87) 322 final/2 
(Submitted by the Commission to the Council on 7 August 1987) 
(87/C 252/02) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 99 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Par­
liament, 
Having regard to the opinion of the Economic and 
Social Committee, 
Whereas completing the internal market, which is one of 
the fundamental objectives of the Community, requires 
that fiscal frontiers be abolished, that is to say that the 
system of remission of tax on exportation and the 
imposition of tax on importation and of frontier controls 
on taxable persons as well as on private persons be 
discontinued; 
"Whereas the abolition of the remission of taxation on 
exports and of the charging of tax on imports must not, 
as regards Community trade between taxable persons, 
interfere with the principle that the tax revenue arising 
from the application of the tax at the final consumption 
stage should be assigned to the Member State where that 
final consumption occurs; 
Whereas consequently Council Directive 77/388/ 
EEC (*), last amended by the Act of Accession of Spain 
and Portugal, should be amended, and the Directives 
dealing with exemption at importation should be 
modified, 
HAS ADOPTED THIS DIRECTIVE: 
Article 1 
Directive 77/388/EEC is replaced by the following: 
1. Article 2 (2) is replaced by the following: 
'2. The importation of goods from third countries'. 
(') OJNoL 145, 13.6. 1977, p. 1. 2. Article 7 is replaced by the following: 
Article 7 
Importation of goods shall mean the entry of goods 
from third countries into the territory of the country 
as defined in Article 3.' 
3. Article 8 (2) is replaced by the following: 
'2. By way of derogation from paragraph 1 (a), 
where the place of departure of the consignment or 
transport of goods is in a third country, the place of 
the supply by the importer within the meaning of 
Article 21 (2) and the place of any subsequent 
supplies shall be deemed to be within the country of 
import of the goods.' 
4. Article 9 (2) (b) is replaced by the following: 
'(b) the place where transport services are supplied 
shall be the pkce of departure. 
"Place of departure" shall mean the place where 
the transport operation actually commences as 
given on the ticket or waybill, without taking 
any intermediate stops into consideration. 
However, where several suppliers in turn take 
part in the same transport operation, the place 
of departure shall mean each place where the 
service supplied by each such person begins. For 
the purposes of this provision, the place of 
departure for a feeder transport operation to a 
port, airport or, more generally, to the point 
where main transport operation starts shall not 
be regarded as the place of departure for that 
main operation. 
In the case of an outward and inward transport 
operation, even if this is carried out by the same 
supplier of services, the return journey shall be 
regarded as a separate service, whose place of 
departure shall be determined in accordance 
with the previous subparagraph. However, with 
regard to outward and inward transport 
operations between one bank and the other of a 
waterway performed under a single contract, 
22.9. 87 Official Journal of the European Communities No C 252/3 
the place for the whole transport operation, 
shall be that where the outward journey 
commences.' 
5. The introductory phrase of Article 9 (2) (e) is 
replaced by the following: 
'the place where the following services are supplied 
when performed for customers established outside 
the Community, or for taxable persons established in 
the Community by suppliers established outside the 
Community, shall be the place where the customer 
has established his business or has a fixed 
establishment to which the service is supplied or, in 
the absence of such a place, the place where he has 
his permanent address or usually resides:'. 
6. Article 11 B is amended as follows: 
— Paragraph 1 is replaced by the following: 
'1. The taxable amount shall be the value for 
customs purposes, determined in accordance with 
Council Regulation (EEC) No 1224/80 (x). 
O OJNoL 134,31. 5. 1980, p. 1.' 
— Paragraph 2 is deleted. 
7. In Article 11 B (5), the words 'outside the 
Community' are added after the words 'have been 
temporarily exported'. 
8. The following subparagraph is added to Article 
13 B: 
'(i) supplies of gold to Central Banks.' 
9. Article 13 C (b) is replaced by the following: 
'(b) the transactions covered in B (g) and (h) above.' 
10. In Article 14 (1) (c), (d), (e) and (g), the words 'or 
which would (so) qualify (therefore) ... if they were 
imported from a third country' are deleted. 
11. Article 14 (1) (f) is deleted. 
12. The title of Article 15 is replaced by the following: 
'Exemption of exports to third countries, like 
transactions and international transport'. 
13. In Article 15 (1) and (2), the words 'outside the 
territory of the country as defined in Article 3' are 
replaced by the words 'outside the Community'. 14. Article 15 (3) is replaced by the following: 
'3. the supply of services consisting of work on 
movable property acquired or imported for the 
purpose of undergoing such work within the 
territory as defined in Article 3, and dispatched 
or transported out of the Community by the 
person providing the services or by the customer 
if established in a third country or on behalf of 
either of them;'. 
15. In Article 15 (4) (a), the words 'to third countries' 
are added after the words 'carrying passengers for 
reward'. 
16. In Article 15 (6), the words 'to third countries' are 
added after the words 'for reward chiefly on inter­
national routes'. 
17. Article 15 (11) is deleted. 
18. In Article 15 (12), the words 'to third countries' are 
added after the words 'which export them'. 
19. In Article 15 (13), the words 'to third countries' are 
added after the words 'the export of goods'. 
20. In Article 15 (14), the words 'outside the territory of 
the country as defined in Article 3' are replaced by 
the words 'outside the Community'. 
21. The second paragraph of Article 15 (14) is deleted. 
22. Article 15 (15) is replaced by the following: 
'15. air and sea transport operations to or from the 
islands which make up the autonomous regions 
of the Azores and Madeira, or carried out 
between the said islands.' 
23. Article 16 (2) is replaced by the following: 
'2. Subject to the consultation provided for in Article 
29, Member States may opt to exempt imports for 
and supplies of goods to a taxable person intending 
to export them to third countries as they are or after 
processing, as well as supplies of services linked to 
that export business, up to a maximum equal to the 
value of exports to third countries during the 
preceding 12 months.' 
24. In the introductory phrase of Article 17 (2), the 
words 'within the country' are added after the words 
'for the purposes of his taxable transactions'. 
25. In Article 17 (2) (a), the words 'liable to pay tax 
within the Community' are added after the words 
'by another taxable person'. 
No C 252/4 Official Journal of the European Communities 22.9.87 
26. The following subparagraph (d) is added to Article 
17(3): 
'(d) transactions exempted under Article 13 B (i).' 
27. Article 17 (4) is replaced by the following: 
'4. As regards taxable persons not established 
within the territory of the Community, entitlement 
to a refund shall be determined in accordance with 
Council Directive 86/560/EEC ('). 
O OJ No L 326, 21. 11. 1986, p. 40.' 
28. The following subparagraph is added to Article (2): 
'Where deductible tax is expressed in the national 
currency of a Member State other than that in which 
it is to be deducted, or in the currency of a third 
country, the amount to be deducted shall be 
converted into the currencies of the taxable person's 
country using the average exchange rate for the 
declaration period'. 
29. The following subparagraph is added to Article 22 
(4): 
'The return must also contain on the one hand a 
declaration of the total amount of VAT relating to 
transactions carried out for taxable persons in other 
Member States, and on the other hand a declaration 
of the total amount of deductible VAT relating to 
transactions carried out by taxable persons in other 
Member States. This provision shall not apply to 
taxable persons whose annual turnover does not 
exceed 35 000 ECU.' 
Article 2 
The provisions brought into force by the Member States 
under Article 28 of Directive 77/388/EEC shall cease to 
apply on 31 December 1992 at the latest in each of the 
Member States concerned. Article 3 
1. The following Directives shall cease to apply on 31 
December 1992: 
— Directive 79/1072/EEC, 
— Directive 83/182/EEC, 
— Directive 83/183/EEC, 
— Directive 74/651/EEC. 
2. The following Directives shall cease to apply on 31 
December 1992, in respect of intra-Community trade 
relations: 
— Directive 69/169/EEC, 
— Directive 83/181/EEC. 
Article 4 
On a proposal from the Commission, the Council shall 
adopt the procedures which will make it possible to 
establish a clearing-house system with regard to VAT on 
intra-Community sales. 
Article 5 
Member States shall adopt the necessary provisions to 
comply with this Directive by 31 December 1992 at the 
latest. They shall notify the Commission immediately. 
The Member States shall send the Commission the text 
of any provisions of national law which they adopt in the 
field governed by this Directive. 
Article 6 
This Directive is addressed to the Member States.