Case C-533/03: Action brought on 19 December 2003 by the Commission of the European Communities against the Council of the European Union
Date: 2004-03-06
Institutions: Court of Justice
Subjects: Council of the European Union, European Commission, European tax cooperation, VAT, action for annulment (EU), tax, tax harmonisation

6.3.2004

EN

Official Journal of the European Union

C 59/9

Furthermore, there are no legal measures in place in the
federal Land of North Rhine-Westphalia for ensuring that an
environmental impact assessment will be carried out if, under
the law of that Land,
it is to be anticipated that a road
construction project will have a significant impact on the
environment.

(1) OJ 1985 L 175, p. 40.
(2) OJ 1997 L 73, p. 5.

Action brought on 19 December 2003 by the Commission
of the European Communities against the Council of the
European Union

(Case C-533/03)

(2004/C 59/15)

An action against the Counci of the European Union was
brought before the Court of Justice of the European Communi-
ties on 19 December 2003 by the Commission of the European
Communities, represented by R. Lyal, acting as agent, with an
address for service in Luxembourg.

The Applicant claims that the Court should:

1.

declare that Council Regulation (EC) No 1798/2003 of
7 October 2003 on administrative cooperation in the
field of value added tax and repealing Regulation (EEC)
No 218/92 (1) and Council Directive 2003/93/EC of
7 October 2003 amending Council Directive 77/799/
EEC concerning mutual assistance by the competent
authorities of the Member States in the field of direct and
indirect taxation (2) are void;

2. maintain the effects of these measures until the entry into
force of legislation adopted on the correct legal basis;

3.

order the Council of the European Union to pay the costs.

According to the second paragraph of Article 95 EC, the
derogation from Article 94 contained in Article 95, para-
graph 1, shall not apply to fiscal provisions. In the view of
the Commission, the expression ‘fiscal provisions’ is to be
understood as including rules on taxable persons, taxable
events, basis of taxation, rates and exemptions, along with the
detailed rules on assessment and enforcement. Conversely, the
Commission submits that that logic does not extend to mutual
assistance in tax matters. Measures of cooperation, verification
and information whose purpose is to facilitate the elimination
of frontiers without affecting the substance of Member States’
own tax rules do not impinge on the tax jurisdiction of
Member States.

The Commission submits that the provisions of Regulation
1798/2003 cannot properly be regarded as effecting a harmon-
isation or approximation of national tax rules. Regulation
1798/2003 is concerned solely with the exchange of infor-
mation in relation to transactions which take place across
frontiers within the Community, in order to enable national
tax authorities to cooperate with each other and with the
Commission to ensure compliance with the law on VAT in the
absence of frontier controls. It does not affect any rules which
are properly to be regarded as ‘fiscal provisions’ within the
meaning of Article 95(2) EC or ‘legislation concerning turnover
taxes’ within the meaning of Article 93 EC.

For its part, Directive 2003/93 amends Directive 77/799 solely
by the deletion of value added tax and the insertion of taxes
on insurance premiums. It does not affect the nature of that
directive, which concerns the exchange of information and
thus does not constitute the harmonisation of ‘fiscal provisions’
within the meaning of Article 95(2) EC.

It must therefore be concluded that the object of the legislation
in question is the completion of the internal market. It does
not constitute a set of measures harmonising tax provisions.
The correct legal base is thus Article 95 EC.

The Commission accordingly submits that Council Regulaton
(EC) No 1798/2003 and Council Directive 2003/93/EC were
adopted on an incorrect
the
prerogatives of the Parliament.

in disregard of

legal basis,

Pleas in law and main arguments

(1) OJ L 264, 15.10.2003, p. 1.
(2) OJ L 264, 15.10.2003, p. 23.

The issue in this case is whether Articles 93 and 94 on the one
hand or Article 95 EC on the other is the correct legal basis
for the adoption of a measure such as Regulation 1798/2003
and Directive 2003/93.