Belgian State v Temco Europe SA.
Date: 2004-11-18
16. It should be observed at the outset that according to settled case-law the exemptions provided for in Article 13 of the Sixth Directive have their own independent meaning in Community law and must therefore be given a Community definition (see Case C‑358/97 Commission  v Ireland  [2000] ECR I‑6301, paragraph 51; Case C-315/00 Maierhofer [2003] ECR I-563, paragraph 25; and Case C-275/01 Sinclair Collis [2003] ECR I-5965, paragraph 22).
17. Secondly, the terms used to specify the exemptions provided for by Article 13 of the Sixth Directive are to be interpreted strictly since they constitute exceptions to the general principle that VAT is to be levied on all services supplied for consideration by a taxable person (see, inter alia, Commission v Ireland , paragraph 52; Case C-150/99 Stockholm Lindöpark  [2001] ECR I-493, paragraph 25; and Sinclair Collis , paragraph 23). As the Advocate General rightly states at point 37 of his Opinion, the requirement of strict interpretation does not mean, however, that the terms used to specify exemptions should be construed in such a way as to deprive the exemptions of their intended effect.
18. As regards the exemptions laid down under Article 13B(b) of the Sixth Directive, it must be noted that that provision does not define ‘letting’, nor does it refer to relevant definitions adopted in the legal orders of the Member States (see Case C‑326/99 Goed Wonen  [2001] ECR I-6831, paragraph 44, and Sinclair Collis , paragraph 24). That provision must therefore be interpreted in the light of the context in which it is used, and of the objectives and the scheme of the Sixth Directive, having particular regard to the underlying purpose of the exemption which it establishes (see, to that effect, Goed Wonen , paragraph 50).
19. In numerous cases, the Court has defined the concept of the letting of immovable property within the meaning of Article 13B(b) of the Sixth Directive as essentially the conferring by a landlord on a tenant, for an agreed period and in return for payment, of the right to occupy property as if that person were the owner and to exclude any other person from enjoyment of such a right (see, to that effect, Goed Wonen , paragraph 55; Case C-409/98 Mirror Group  [2001] ECR I-7175, paragraph 31; Case C-108/99 Cantor Fitzgerald International  [2001] ECR I-7257, paragraph 21; Case C-269/00 Seeling  [2003] ECR I-4101, paragraph 49; and Sinclair Collis , paragraph 25).
20. While the Court has stressed the importance of the period of the letting in those judgments, it has done so in order to distinguish a transaction comprising the letting of immovable property, which is usually a relatively passive activity linked simply to the passage of time and not generating any significant added value (see, to that effect, Goed Wonen , paragraph 52), from other activities which are either industrial and commercial in nature, such as the exemptions referred to in Article 13B(b)(1) to (4) of the Sixth Directive, or have as their subject‑matter something which is best understood as the provision of a service rather than simply the making available of property, such as the right to use a golf course ( Stockholm Lindöpark , paragraphs 24 to 27), the right to use a bridge in consideration of payment of a toll ( Commission v Ireland ) or the right to install cigarette machines in commercial premises ( Sinclair Collis , paragraphs 27 to 30).
21. The actual period of the letting is thus not, of itself, the decisive factor in determining whether a contract is one for the letting of immovable property under Community law, even if the fact that accommodation is provided for a brief period only may constitute an appropriate basis for distinguishing the provision of hotel accommodation from the letting of dwelling accommodation (Case C-346/95 Blasi  [1998] ECR I-481, paragraphs 23 and 24).
22. In any event, it is not essential that that period be fixed at the time the contract is concluded. It is necessary to take into account the reality of the contractual relations ( Blasi , paragraph 26). The period of a letting may be shortened or extended by the mutual agreement of the parties during the performance of the contract.
25. The presence in the contract of such restrictions on the right to occupy the premises let does not prevent that occupation being exclusive as regards all other persons not permitted by law or by the contract to exercise a right over the property which is the subject of the contract of letting.