CELEX: C1997/387/13
Language: en
Date: 1997-12-20 00:00:00
Title: Action brought on 22 October 1997 by the Commission of the European Communities against the Italian Republic (Case C-365/97)

C 387/8               fENl                Official Journal of the European Communities                                         20 . 12 . 97
' 1 . 'Taxable    person'    shall mean   any    person   who        under the various national legal systems . Any other
      independently carries out in any place any economic            interpretation would encroach upon the uniform
      activity specified in paragraph 2 whatever the purpose         application of Community law.
      or results of that activity.
                                                                     Interpreted objectively, the concept of ' supplying services'
  2 . The economic activities referred to in paragraph 1             encompasses services supplied to users by the operators of
      shall comprise all activities of producers traders and         a road or other element of infrastructure used for the
      persons supplying services      .). The exploitation of        transport of goods or persons. This interpretation has
      tangible or intangible property for the purpose of             always been accepted by a number of Member States
      obtaining income therefrom on a continuing basis               notably Spain and Italy which levy VAT on all tolls paid
      shall also be considered an economic activity '.               for the use of motorways and other elements of road
      ( Emphasis added )                                             infrastructure . The exemption from VAT granted by
                                                                     certain Member States including the United Kingdom
                                                                     therefore throws out of balance not only the operation of
The Commission submits that one example of 'the                      the common system of value added tax but also the
exploitation of tangible or intangible property for the              contributions to the Communities' own resources by the
purpose of obtaining income therefrom on a continuing                Member States .
 basis' is operating a road and charging a toll for its use .
As a result, such operations are an economic activity and
 hence the person carrying them out is a taxable person for          The absence of VAT on road tolls is incompatible with
the purposes of the Sixth VAT Directive .                            Community rules on the collection of the Communities'
                                                                     own resources .
The Commission submits that a transaction which falls
 under the scope of the Sixth VAT Directive is subject to            The Commission submits that if road tolls are subject to
 VAT Svhatever the purpose or results of that activity' as           VAT, it follows that a proportion of the VAT concerned
 stated in Article 4 paragraph 1 of the Directive .
                                                                     should have been taken into account as part of the United
                                                                     Kingdom's contribution to the own resources of the
                                                                     Communities .
 In particular, the Commission submits that operating
 motorways, inland waterways and port facilities is an
 economic activity.                                                  (') 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 . 6 . 1977, p. 1 ).
 The case-law of the Court makes it clear that a supply of
 services is subject to VAT when the service in question is
 provided in return for payment, the taxable base being
 everything which makes up the consideration given in
 return for that service . As the Court has pointed out there
 must be 'a direct link between the service rendered and
 the consideration received '.
                                                                     Action brought on 22 October 1997 by the Commission
                                                                      of the European Communities against the Italian Republic
 With regard to tolls paid for the use of a road there is                                     ( Case C-365/97)
 incontestably a direct link between the service rendered
 and the consideration received in exchange, if payment is                                      ( 97/C 387/13 )
 levied each time a vehicle is allowed to use the road .
 The fact that a private operator carries out activities             An action against the Italian Republic was brought before
 which contribute to the general good does not prevent               the Court of Justice on 22 October 1997 by the
 those activities being subject to VAT.                               Commission of the European Communities, represented
                                                                      by Paolo Stancanelli, of its Legal Service, acting as Agent,
                                                                      assisted by Massimo Merola, of the Rome Bar, with an
 Community definition
                                                                      address for service in Luxembourg at the office of Carlos
                                                                      Gomez de la Cruz, Wagner Centre , Kirchberg.
 The Sixth VAT Directive imposes VAT on any 'economic
 activity' of which 'supplying services' is one category. In          The applicant claims that the Court should:
 this context the concepts of ' supplying services' and
 'economic activity' for the purposes of the Sixth VAT
 Directive must be interpreted objectively on the basis of            — Declare that the Italian Republic has failed to fulfil its
 the economic reality of the transaction and irrespective of              obligations under the EC Treaty in that, with regard to
 the manner in which the transaction may be classified                    the S. Rocco riverbed,
 ---pagebreak--- 20 . 12 . 97            EN                  Official Journal of the European Communities                                          C 387/9
     — it has not adopted the necessary measures to                    to ensure that the waste is disposed of without
          ensure that waste is disposed of without                     endangering human health and without harming the
          endangering human health and without harming                 environment, and in particular without risk to water, air,
          the environment, and in particular without risk to           soil and plants and animals, without causing a nuisance
          water, air, soil and plants and animals, without             through noise or odours, and without adversely affecting
          causing a nuisance through noise or odours, and              the countryside or places of special interest.
          without adversely affecting the countryside or
          places of special interest, in breach of Article 4 of
          Directive 75/442/EEC (') ( or Article 4 of Directive         The Commission also considers that the competent
          75/442/EEC as amended by Directive 91 / 156/                 authorities designated in accordance with Article 5 of the
          EC (2 ), which substantially reproduces the                  directive as originally worded (Article 6 of the amended
          provisions thereof),                                         directive ) have not fulfilled their obligations concerning
                                                                       the organization, authorization and supervision of waste
                                                                        disposal operations in the area in question, as is apparent
     — the competent authorities designated in accordance               from the continuing poor state of the S. Rocco valley.
          with Article       5 of Directive 75/442/EEC        (or
          Article 6 of Directive 75/442/EEC as amended
           by Directive 91 /156/EC, which substantially
           reproduces the provisions thereof) have not                  The Commission also concludes that, in so far as waste
           fulfilled their obligations concerning the                   continues to be tipped into the riverbed in question, the
           organization, authorization and supervision of               competent authorities have failed to supervise the
           waste disposal operations in the area in question,           undertakings transporting, collecting, storing, tipping or
           in breach of Article 5 of Directive 75/442/EEC ( or          treating their own waste and that of third parties, in
           Article 6 of Directive 75/442/EEC as amended by              breach of the obligations imposed by Article 10 of
           Directive 91 / 156/EC ),                                     Directive 75/442/EEC as originally worded (or Article 13
                                                                        of Directive 75/442/EEC as amended ).
     — the competent authorities have not fulfilled
           their obligation of supervising undertakings                 As regards, finally, the existence of a pit used for fly
           transporting, collecting, storing, tipping or treating       tipping, the Commission, although aware of the criminal
           their own waste and those which collect or                    proceedings instituted against the concessionaire, has
           transport waste on behalf of third parties, in                never been informed of the progress of those proceedings.
            breach of Article 10 of Directive 75/442/EEC (or
            Article 13 of Directive 75/442/EEC as amended by
                                                                         (') OJ L 194, 25 . 7 . 1975 , p . 47; EE 15 F1 p . 129 .
            Directive      91 /156/EC,    which      substantially       ( 2 ) OJ L 78 , 26 . 3 . 1991 , p . 32 .
            reproduces the provisions thereof),
      — it has not taken the necessary measures to ensure
            that, with regard to a pit in the tufa located in the
            S. Rocco riverbed area, used for fly tipping in the
            past, the concessionaire responsible for that pit has
            the waste handled by a private or public waste               Reference for a preliminary ruling from the Oberster
            collector or by a disposal undertaking, in breach             Gerichtshof, Austria, by order of that court of 7 October
            of the first indent of Article 7 of Directive 75/442/         1997 in the case of ( 1 ) The Polo/Lauren Company LP and
            EEC ( or the first indent of Article 8 of Directive               ( 2 ) Poloco SA v. Jürgen Denz, trading as Jeans & More
             75/442/EEC as amended by Directive 91 /156/EC,                                             Case C-370/97 )
             which substantially reproduces the provisions
             thereof),                                                                                   ( 97/C 387/14 )
 — Order the Italian Republic to pay the costs.                            Reference has been made to the Court of Justice of the
                                                                           European Communities by an order of the Fourth Senate
                                                                           of the Oberster Gerichtshof ( Supreme Court), Austria, of
                                                                           7 October 1997, which was received at the Court Registry
  Pleas in law and main arguments adduced in support:                      on 27 October 1997, for a preliminary ruling in the case
                                                                            of ( 1 ) The Polo/Lauren Company LP and ( 2 ) Poloco SA v.
                                                                           Jiirgen Denz, trading as Jeans & More, on the following
  With regard to the pollution caused by the tipping of                     questions :
  waste from the area upstream of the S. Rocco valley, the
  Commission considers that the Italian authorities have
  infringed Article 4 of Directive 75/442/EEC as originally                 Is Article 7 ( 1 ) of the First Council Directive 89/104/EEC
  worded (Article 4 of the amended directive ) in that they                 of 21 December 1988 to approximate the laws of the
  have failed to adopt, in that area , all the measures needed               Member States relating to trade marks ( OJ L 40, 11 . 12 .