Opinion of the European Economic and Social Committee on the "Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EEC) No 218/92 on administrative co-operation in the field of indirect taxation (VAT) as regards additional measures regarding supplies of travel services" (COM(2003) 78 final/2 — 2003/0057 (COD))
Date: 2003-06-18
Institutions: European Economic and Social Committee
Subjects: VAT, administrative cooperation, provision of services, single market, travel agency

C 220/68

EN

Official Journal of the European Union

16.9.2003

Opinion of the European Economic and Social Committee on the ‘Proposal for a Regulation of
the European Parliament and of the Council amending Regulation (EEC) No 218/92 on
administrative co-operation in the field of indirect taxation (VAT) as regards additional measures
regarding supplies of travel services’

(COM(2003) 78 final/2 — 2003/0057 (COD))

(2003/C 220/13)

On 12 March 2003 the Council decided to consult the Economic and Social Committee, under Article 262
of the Treaty establishing the European Community, on the above-mentioned proposal.

Owing to the urgent nature of the opinion, the European Economic and Social Committee decided, at its
400th plenary session of 18 and 19 June 2003 (meeting of 18 June), to appoint Mr Barbadillo López
rapporteur-general and adopted the following opinion by 65 votes to none with one abstention.

1.

Introduction

2002 amending temporarily Regulation (EEC) No 218/92 on
administrative cooperation in the field of indirect taxation
(VAT) as regards additional measures regarding electronic
commerce (5).

1.1.
On 8 February 2002 the Commission published a
Proposal for a Council Directive amending Directive 77/388/
EEC as regards the special scheme for travel agents (1).

1.2.
The European Economic and Social Committee adopt-
ed its opinion on the proposal at the plenary session of 17 and
18 July 2002 (2).

1.5.
The European Economic and Social Committee adopt-
ed an opinion (6) on Directive 2002/38/EC and Regulation
(EC) No 792/2002 at its plenary session of 29 and 30 Novem-
ber 2000.

1.3.
On 24 September 2002 the European Parliament
adopted its report (3) on the draft Council directive, proposing
two amendments. The Commission accepted one of them,
concerning the introduction of the ‘one-stop shop’ principle
for non-established suppliers supplying services to EU cus-
tomers, and undertook to amend the initial draft and submit
the ensuing amended proposal for a directive.

1.6.
The new elements introduced by the amended Proposal
for a Council Directive amending Directive 77/388/EEC as
regards the special scheme for travel agents (7) make it
necessary to amend Regulation (EEC) No 218/92 on adminis-
trative co-operation in the field of indirect taxation (VAT) (8)
in order to regulate the procedure for exchange of information
between the Member State in which the non-EC operator is
identified and the other Member States.

1.4.
The principle of a ‘one-stop shop’ for non-established
suppliers of travel services who supply services to customers
established in the Community is based on that introduced in
Council Directive 2002/38/EC of 7 May 2002 amending and
amending temporarily Directive 77/388/EEC as regards the
value added tax arrangements applicable to radio and television
broadcasting services and certain electronically supplied ser-
vices (4) and Council Regulation (EC) No 792/2002 of 7 may

For these reasons, the Commission has proposed a
1.7.
new European Parliament and Council regulation amending
Regulation (EEC) No 218/92 on administrative cooperation in
the field of indirect taxation (VAT) as regards additional
measures regarding supplies of travel services (9), which it has
referred to the European Economic and Social Committee for
an opinion.

( 1) COM(2002) 64 final.
( 2) OJ C 241, 7.10.2002, p. 83.
( 3) Report on the proposal for a Council directive amending Directive
77/388/EEC as regards the special scheme for travel agents
(COM(2002) 64 final — C5-0112/2002 — 2002/0041 (CNS)),
PE 307.532, A5-0274/2002.
( 4) OJ L 128, 15.5.2002, p. 41.

(5) OJ L 128, 15.5.2002, p. 1.
(6) OJ C 116, 20.4.2001, p. 59.
(7) COM(2003) 78 final.
(8) OJ L 24, 1.2.1992, p. 1.
(9) COM(2003) 78 final/2.

16.9.2003

EN

Official Journal of the European Union

C 220/69

2. The Commission’s proposals

The amended Proposal

2.1.
for a Council Directive
amending Directive 77/388/EEC as regards the special scheme
for travel agents (1) provides a framework for the application
founded on
of VAT to non-established taxable persons,
establishing a series of obligations concerning registration for,
and payment of VAT in any of the Member States. In order to
ensure that non-established suppliers of services comply
with these obligations, and given that the Member State of
consumption must transmit the necessary information to the
other Member States, the Commission proposes to amend
Regulation (EEC) No 218/92 on administrative cooperation in
the field of indirect taxation (VAT) (2).

transferred, within ten days of the end of the month in which
the payment was received, to the bank account denominated
in euro designated by the Member State of consumption. If the
non-established taxable person does not pay the total tax due,
the Member State of
identification shall ensure that the
payment is transferred in proportion to the tax due in each
Member State and inform them by electronic means of the
transfer. The Member States must notify the competent
authorities of the other Member States of the relevant bank
account numbers for receiving the payments, and of any
changes in the standard rate of VAT. Changes in VAT rates
must also be reported to the Commission.

The Commission is proposing two amendments to
2.2.
Regulation (EEC) No 218/92:
to insert a new Title III B
introducing six new articles, and to replace the first sentence
of Article 13(1) of the regulation.

3. Comments

2.3.
Non-established taxable persons must submit infor-
mation on the commencement, termination or amendment of
their activities to the Member State of
identification in
electronic form; the Member State of identification must in
turn forward this information, together with the allocated
identification number, by electronic means to the competent
authorities of the other Member States within ten days from
the end of the month during which the information was
received. The Member State of identification must also inform
the other Member States by electronic means of any exclusion
of a non-established taxable person from the identification
register.

their
Non-established taxable persons must submit
2.4.
VAT return in electronic form to the Member State of
identification. The Member State must in turn forward this
return by electronic means to the competent authorities of the
Member State concerned at the latest ten days after the end of
the month in which the return was received. When a Member
State requires that the return be expressed in a currency other
than the euro, it shall convert the amounts into euro using the
exchange rate published by the European Central Bank before
sending them to other Member States.

2.5.
The competent authorities of the Member States must
maintain an electronic database to store information concern-
ing non-established suppliers of travel services.

The Member State of identification must ensure that
2.6.
the amount the non-established taxable person has paid is

( 1) COM(2003) 78 final.
( 2) OJ L 24, 1.2.1992, p. 1.

3.1.
The Committee welcomes the Proposal for a Regu-
lation of the European Parliament and of the Council amending
Regulation (EEC) No 218/92 on administrative cooperation in
the field of indirect taxation (VAT) as regards additional
measures regarding supplies of travel services.

3.2.
However, the Committee would point out that the
amendment to Regulation (EEC) No 218/92, which is the
subject of the present opinion, can only be adopted if the
amended Proposal for a Council Directive amending Directive
77/388/EEC as regards the special scheme for travel agents (1)
is itself adopted, since the amendment to the regulation is only
appropriate if the ‘single-stop shop’ principle is brought into
effect for non-established suppliers of travel services with
customers established in the EC in the terms currently
contained in the amended proposal for a directive.

3.3.
The Committee endorses the proposal to allow non-
established suppliers of travel services to comply with their
identification obligations, where they can, by electronic means,
in keeping with the terms of the amended Proposal for a
Council Directive amending Directive 77/388/EEC as regards
the special scheme for travel agents (1). It might be more
reasonable to extend the methods by which operators can
comply with their registration obligations to include non-
electronic means, since restricting them to electronic means
may be a further obstacle to them identifying themselves or
submitting returns. The Committee is however aware that
most Member States are unlikely to accept non-electronic
procedures because of the greater administrative costs entailed.

C 220/70

EN

Official Journal of the European Union

16.9.2003

3.4.
The Committee’s main concern is the lack of any
guarantee that third country operators supplying services to
customers established in the EC will comply with the infor-
mation and payment obligations set out in the proposed
regulation. The directive’s objectives concerning unfair compe-
tition from non-EC operators vis-à-vis their EC counterparts
may therefore frustrated.

3.5.
The Committee agrees with the administrative cooper-
ation procedure between the Member State of identification
and the other Member States as set out in the regulation, but
would recommend that the first paragraph of Article 9i(2) be
worded more carefully with respect to the Member States to
which the Member State of identification must electronically
transmit the VAT returns of non-established suppliers of travel
services. It is unclear whether they must be transmitted to all
the Member States or only to those where consumption
occurred.

[This point indicates a minor typing error in the
3.6.
Spanish version of the Commission document relating to
Article 9j: it does not concern the English version]

4. Conclusions

4.1.
The Committee supports the Commission’s efforts to
create a proper framework for cooperation between the
Member States facilitating the smooth functioning of the
special scheme for travel agents which the Commission has
proposed to introduce by amending Directive 77/388/EEC.

Brussels, 18 June 2003.

4.2.
The Committee shares the Commission’s concern
regarding the need to remove the competitive disadvantages
suffered by EC operators compared to those from third
countries.

4.3.
The Committee believes that the proposal for a regu-
lation represents a step forward in regulating a system designed
to remove competitive disadvantages between Community
suppliers of travel services compared to their non-EC counter-
parts. However, the Committee would express its doubts
about whether unfair competition will actually be dealt with:
registration and payment depend on the willingness of non-
Community operators. The reform proposed by the Com-
mission therefore fails to guarantee the removal of unfair
competition.

4.4.
The Committee approves the provisions of the draft
regulation regarding information exchanges the procedure for
transfers between Member States arising from the special
scheme for travel agents which the Commission has proposed
to introduce by amending Directive 77/388/EEC.

However, in order to make the regulation clearer, the
4.5.
Committee recommends that the Commission expand upon
or alter the wording of the first paragraph of Article 9i(2) to
make it clearer to which Member States the Member State of
identification must electronically transmit the VAT returns of
non-established suppliers of travel services. [A minor typing
error in the Spanish version of the Commission document
relating to Article 9j is also indicated: it does not concern the
English version].

The President

of the European Economic and Social Committee

Roger BRIESCH