Case C-419/02: Reference for a preliminary ruling by the High Court of Justice (England and Wales) (Chancery Division) by order of that court dated 8 November 2002, in the case of 1) BUPA Hospitals Ltd and 2) Goldsborough Developments Ltd against the Commissioners of Customs and Excise
Date: 2003-02-08
Institutions: Court of Justice
Subjects: VAT, delivery, distributive trades, goods and services, interpretation of the law, tax exemption, tax relief

C 31/6

EN

Official Journal of the European Union

8.2.2003

75/442/EEC. Furthermore, those authorities have never
denied that strong odours emanating from that farm
reach nearby housing. Also, the incorrect arrangements
for handling the slurry, which is emptied into a pit which
is too small for the size of the exploitation, and for
disposing of carcasses results in the improper dumping
of slurry and remains of animals in the surrounding area.
Finally, the Spanish authorities have not submitted any
description of
to check
whether Directive 75/442/EEC is being complied with.

the inspections carried out

Although the pig farm in question is substantial, counting
with 2 779 pigs and more than 600 suckling pigs, and is
located 600 metres from the river Antas, which the
Spanish authorities have declared an area of Community
it has not been the subject of an impact
interest,
assessment as required by Directive 85/337/EEC.

— The waste-water of the agglomeration of Vera, with a
population of more than 10 000, which is deposited in
an area which ought to have been designated as sensitive,
should be treated more stringently than merely by means
of secondary treatment. Clear evidence of the insufficient
tratement of Vera’s waste-water is the fact that
the
quantity of the chemical oxygen demand (COD) in the
sample analysed at the request of the Commission is of
353 mgO2/l, which is three times greater than the
maximum authorised for effluent from a waste treatment
station.

— By decree of 2 March 1999, the Spanish authorities
declared the sensitive areas of the Autonomous Com-
munity of Andalucia, including, in respect of Almeria, the
coastal lagoons of the Aguas and Antas rivers, whose
waters are eutrophic, with a high concentration of
nitrates. Consequently, pursuant to Article 3(2) of Direc-
tive 91/676/EEC, the Spanish authorities should have
designated the area which drains into those waters as a
vulnerable area.

( 1) Council Directive 75/442/EEC of 15 July 1975 on waste (OJ 1975

L 194, p. 39).

( 2) Council Directive 91/156/EEC of 18 March 1991 amending

Directive 75/442/EEC on waste (OJ 1991 L 78, p. 32).

( 3) Council Directive 85/337/EEC of 27 June 1985 on the assessment
the effects of certain public and private projects on the

of
environment (OJ 1985 L 175, p. 40).

( 4) Council Directive 97/11/EC of 3 March 1997 amending Directive
85/337/EEC on the assessment of the effects of certain public and
private projects on the environment (OJ 1997 L 73, p. 5).

( 5) Council Directive 80/68/EEC of 17 December 1979 on the
protection of groundwater against pollution caused by certain
dangerous substances (OJ 1980 L 20, p. 43).

( 6) Council Directive 91/271/EEC of 21 May 1991 concerning urban

waste-water treatment (OJ 1991 L 135, p. 40).

( 7) Council Directive 91/676/EEC of 12 December 1991 concerning
the protection of waters against pollution caused by nitrates from
agricultural sources (OJ 1991 L 375, p. 1).

Reference for a preliminary ruling by the High Court of
Justice (England and Wales) (Chancery Division) by order
of that court dated 8 November 2002, in the case of
1) BUPA Hospitals Ltd and 2) Goldsborough Develop-
ments Ltd against the Commissioners of Customs and
Excise

(Case C-419/02)

(2003/C 31/10)

Justice of the
Reference has been made to the Court of
the High Court
European Communities by an order of
of Justice (England and Wales)
(Chancery Division) dated
8 November 2002, which was received at the Court Registry
on 20 November 2002, for a preliminary ruling in the case of
1) BUPA Hospitals Ltd and 2) Goldsborough Developments
Ltd and the Commissioners of Customs and Excise, on the
following questions:

Q u e s t i o n 1

Having regard to the relevant circumstances, the relevant
transactions and the position of the vendor companies how is
the expression ‘economic activity’ within the meaning of
Article 4(1) and (2) of Directive 77/388/EEC on VAT (1) (the
Directive) to be interpreted?

Q u e s t i o n 2

Having regard to the relevant circumstances, relevant trans-
actions, and the position of the vendor companies how is the
expression ‘supply of goods’ in Article 5(1) of the Directive to
be interpreted?

Q u e s t i o n 3

a)

Is there a principle of abuse of rights and/or abuse of the
law which (independently of the interpretation given to
the Directive) is capable of precluding the right to deduct
input tax?

b)

If so, in what circumstances would it apply?

c) Would it apply in circumstances such as those found by

the Tribunal?

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Q u e s t i o n 4

Does it make any difference to the answers to questions 1 to 3
above if payment is made in respect of the relevant transactions
at a time when any onward supply of the goods would have
been an exempt supply with refund of VAT at the preceding
stage as permitted by Article 28(2)(a) of the Directive?

Q u e s t i o n 5

How is the Directive to be interpreted with particular reference
to the following questions? In circumstances such as the
relevant circumstances and with reference to transactions such
as the relevant transactions:

a)

b)

should supplies be treated as having been made by the
outside suppliers to the purchasing companies with no
supplies being made to or by the vendor companies? or

should supplies be treated as having been made by the
outside suppliers to the vendor companies with no
supplies being made by the vendor companies to the
purchasing companies?

how are Article 17 of the Directive and the rules on deduction
to be interpreted? (With reference to paragraph e), if the law
does not change in the way described the purchasing compani-
es are entitled to terminate their contracts with the vendor
companies and claim refunds of the prices paid. In the relevant
transactions the contracts between the purchasing companies
and the vendor companies contain provisions permitting such
terminations.)

Q u e s t i o n 7

The Tribunal found (at paragraph 89 of the Decision) that
‘none of the individuals in a position to take decisions for
[BMSL and Gatwick Park]... had any motive or purpose of
substance other than to carry through the VAT avoidance
scheme.’ The Appellants have, in their Notice of Appeal to the
High Court, challenged that finding of fact. If that finding of
fact were to be set aside on appeal would it make any, and if
so, what difference to the answers to questions 1 to 6 above
inclusive?

(1) Sixth Council Directive 77/388/EEC of 17 May 1977 on the
harmonization of the laws of the Member States relating to
turnover taxes — Common system of value added tax: uniform
basis of assessment (OJ L 145, 13.06.77, p. 1).

Q u e s t i o n 6

In circumstances where each vendor company, in the course
of an economic activity, makes supplies to a purchasing
company and:

a)

the purchasing companies have entered into agreements
with the vendor companies to be supplied with goods;

b)

the goods are invoiced and paid for in advance of delivery;

c)

d)

e)

VAT is charged on the advance payment in accordance
with the second sub-paragraph of Article 10(2) of the
Directive;

the goods are to be used by the purchasing companies in
making supplies which,
if made at the time of the
payment, would have been exempt supplies with a right
to refund at the preceding stage, but

each purchasing company intends to take delivery of the
goods under the agreements only if the law changes in
such a way that the purchasing company’s use of the
goods will be a use in making exempt supplies without a
right of refund

Action brought on 21 November 2002 by the
Commission of the European Communities against the
Hellenic Republic

(Case C-420/02)

(2003/C 31/11)

An action against the Hellenic Republic was brought before
the Court of Justice of the European Communities on 21 No-
vember 2002 by the Commission of the European Communi-
ties, represented by Minas Konstantinidis, of its Legal Service.

The Commission claims that the Court should:

— declare that, by failing to adopt the necessary measures
to ensure that the disposal or recovery of waste will be
carried out without endangering human health, without
risk to water, air, soil, plants and animals and without
causing a nuisance through noise or odours, and by
granting a permit which does not contain the necessary
information, the Hellenic Republic has failed to fulfil its
obligations under Articles 4 and 9 of Directive 75/442/
EEC (1) on waste as amended by Directive 91/156/EEC (2);