Faaborg-Gelting Linien A/S v Finanzamt Flensburg.
Date: 1996-05-02
5 Article 9(1) reads as follows:
"1. The place where a service is supplied shall be deemed to be the place where the supplier has established his business or has a fixed establishment from which the service is supplied or, in the absence of such a place of business or fixed establishment, the place where he has his permanent address or usually resides."
8 After a complaint brought before the Finanzamt (Tax Office) and an appeal to the Finanzgericht (Finance Court) were dismissed, FG-Linien appealed on a point of law to the Bundesfinanzhof.
11 By its first question, the national court asks essentially whether restaurant transactions constitute supplies of goods within the meaning of Article 5 of the Sixth Directive, which, under Article 8(1)(b), are deemed to be carried out at the place where the goods are when the supply takes place, or whether they are supplies of services within the meaning of Article 6(1), which, under Article 9(1) of the directive, are deemed to be carried out at the place where the supplier has established his business.
12 In order to determine whether such transactions constitute supplies of goods or supplies of services, regard must be had to all the circumstances in which the transaction in question takes place in order to identify its characteristic features.
13 The supply of prepared food and drink for immediate consumption is the outcome of a series of services ranging from the cooking of the food to its physical service in a recipient, whilst at the same time an infrastructure is placed at the customer' s disposal, including a dining room with appurtenances (cloak rooms, etc.), furniture and crockery. People, whose occupation consists in carrying out restaurant transactions, will have to perform such tasks as laying the table, advising the customer and explaining the food and drink on the menu to him, serving at table and clearing the table after the food has been eaten.
14 Consequently, restaurant transactions are characterized by a cluster of features and acts, of which the provision of food is only one component and in which services largely predominate. They must therefore be regarded as supplies of services within the meaning of Article 6(1) of the Sixth Directive. The situation is different, however, where the transaction relates to "take-away" food and is not coupled with services designed to enhance consumption on the spot in an appropriate setting.
16 The Court has consistently held (see Case 168/84 Berkholz [1985] ECR 2251, paragraph 17) that, according to Article 9(1), the place where the supplier has established his business is a primary point of reference inasmuch as regard is to be had to another establishment from which the services are supplied only if the reference to the place where the supplier has established his business does not lead to a rational result for tax purposes or creates a conflict with another Member State.
19 The reply to the first question should therefore be that restaurant transactions are to be regarded as supplies of services within the meaning of Article 6(1) of the Sixth Directive, which, under Article 9(1) of the directive, are deemed to be carried out at the place where the supplier has established his business.
20 In view of this answer, there is no need to reply to the national court' s second and third questions.