Staatssecretaris van Financiën v Fiscale Eenheid X NV cs.
Date: 2015-12-09
30. It should be borne in mind from the outset that, according to settled case-law, whilst the exemptions provided for in, inter alia, Article 13B(d)(6) of the Sixth Directive are autonomous concepts of EU law which must, in principle, be given a common definition in order to avoid divergences in the application of the VAT system from one Member State to another, so that the Member States cannot alter their content, that is not the case where the EU legislature has conferred on the Member States the task of defining certain terms of an exemption (see, to that effect, judgments in Abbey National , C‑169/04, EU:C:2006:289, paragraphs 38 and 39; JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraphs 19 and 20; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 16; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 40).
31. As it is, Article 13B(d)(6) of the Sixth Directive confers upon the Member States the task of defining the meaning of ‘special investment funds’ (see judgments in Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 16, and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 40).
32. The power to define thereby accorded to the Member States is, however, limited by the prohibition on undermining the very terms of the exemption that are employed by the EU legislature. A Member State cannot in particular, without negating the very terms ‘special investment funds’, select from among special investment funds those which are eligible for the exemption and those which are not. That provision thus grants it only the power to define, in its domestic law, the funds which meet the definition of ‘special investment funds’ (see, to that effect, judgments in JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraphs 41 to 43; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 17; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 41).
33. The power accorded to the Member States to define the meaning of ‘special investment funds’ must also be exercised consistently with the objectives pursued by the Sixth Directive and with the principle of fiscal neutrality inherent in the common system of VAT (see, to that effect, judgments in JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraphs 22 and 43; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 18; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 42).
34. In that regard it should be observed that the purpose of the exemption of transactions connected with the management of special investment funds is, particularly, to facilitate investment in securities by means of investment undertakings by excluding the cost of VAT and, in that way, ensuring that the common system of VAT is neutral as regards the choice between direct investment in securities and investment through collective investment undertakings (see judgments in JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraph 45; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 19; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 43).
36. It should be borne in mind that funds which constitute undertakings for collective investment in transferable securities within the meaning of the UCITS Directive are special investment funds (see, to that effect, in particular judgments in Deutsche Bank , C‑44/11, EU:C:2012:484, paragraph 32; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 23; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 46). As is clear from Article 1(2) of that directive, undertakings for collective investment in transferable securities are undertakings the sole object of which is the collective investment in transferable securities of capital raised from the public and which operate on the principle of risk-spreading, and the units of which are, at the request of holders, re-purchased or redeemed, directly or indirectly, out of those undertakings’ assets.
37. Furthermore, funds which, without being collective investment undertakings within the meaning of the UCITS Directive, display characteristics identical to theirs and thus carry out the same transactions or, at least, display features that are sufficiently comparable for them to be in competition with such undertakings must also be regarded as special investment funds (see, to that effect, judgments in Abbey National , C‑169/04, EU:C:2006:289, paragraphs 53 to 56; JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraphs 48 to 51; Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 24; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 47).
41. As the Court has repeatedly observed in connection with the interpretation of the exemption of the management of special investment funds within the meaning of that provision, the legislation on VAT was harmonised before harmonisation of the legislation relating to the authorisation and supervision of investment funds and, in particular, the UCITS Directive (judgments in Abbey National , C‑169/04, EU:C:2006:289, paragraph 55, and JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraph 32).
47. The Court has thus held that investments covered by the UCITS Directive and subject in that context to specific State supervision, on the one hand, and funds which, without being collective investment undertakings within the meaning of that directive, display characteristics identical to theirs and thus carry out the same transactions or, at least, display features that are sufficiently comparable for them to be in competition with such undertakings, on the other, must be regarded as exempt special investment funds within the meaning of that provision (judgments in Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraphs 23 and 24, and ATP PensionService , C‑464/12, EU:C:2014:139, paragraphs 46 and 47).
52. In that regard, X and the European Commission are of the opinion that the characteristics of the companies at issue in the main proceedings correspond to those of a special investment fund as determined in the case-law of the Court. An investment fund is thus comparable to collective investment undertakings as defined by the UCITS Directive if persons have purchased participation rights in that fund, if the return on the investment thus made depends on the performance of the investments made by the fund’s managers over the period for which those persons hold those rights, and if the holders are entitled to profits or bear the risk connected with the management of the fund (see, to that effect, judgment in Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 27). In the same vein, the Court has held that company pension funds may be regarded as special investment funds if they are funded by the persons to whom the retirement benefit is to be paid, if the savings are invested using a risk-spreading principle, and if the pension customers bear the investment risk (judgment in ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 59).
60. As the sixth recital in the preamble to the UCITS Directive and Article 24 thereof indicate, and as is apparent from Article 19(1)(e) of that same directive, as amended by Directive 2001/108, not applicable at the material time in the main proceedings, the coordination of legislation in relation to supervision is intended to cover not only UCITS but also other collective investment undertakings (see, to that effect, judgment in JP Morgan Fleming Claverhouse Investment Trust and The Association of Investment Trust Companies , C‑363/05, EU:C:2007:391, paragraphs 32 and 34). Investment in transferable securities is therefore only one particular form of regulated investment.
63. In so far as investments, whether composed of transferable securities or immovable property, are subject to comparable specific State supervision, there is direct competition between those forms of investment. In both cases, what matters for the investor is the interest he derives from those investments. According to settled case-law, the principle of fiscal neutrality precludes treating similar supplies of services, which are thus in competition with each other, differently for VAT purposes (see judgment in Wheels Common Investment Fund Trustees and Others , C‑424/11, EU:C:2013:144, paragraph 21 and the case-law cited).
68. In that regard, it must be observed that, according to settled case-law, the terms used to specify the exemptions in Article 13 of the Sixth Directive are to be interpreted strictly. Nevertheless, the interpretation of those terms must be consistent with the objectives pursued by those exemptions and comply with the requirements of the principle of fiscal neutrality inherent in the common system of VAT. Accordingly, the requirement of strict interpretation does not mean that the terms used to specify the exemptions referred to in Article 13 must be construed in such a way as to deprive the exemptions of their intended effects (see, in particular, judgments in Zimmermann , C‑174/11, EU:C:2012:716, paragraph 22 and the case-law cited, and Mapfre asistencia and Mapfre warranty , C‑584/13, EU:C:2015:488, paragraph 26).
69. As the Court has already noted, the concept of ‘management’ of special investment funds referred to in Article 13B(d)(6) of the Sixth Directive has its own independent meaning in EU law whose content the Member States may not alter (judgment in Abbey National , C‑169/04, EU:C:2006:289, paragraph 43).
71. The Court has, however, made it clear that the transactions covered by the exemption of management of special investment funds are those which are specific to the business of undertakings for collective investment (judgments in Abbey National , C‑169/04, EU:C:2006:289, paragraph 63; Deutsche Bank , C‑44/11, EU:C:2012:484, paragraph 31; and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 65). In particular, it has found that management services provided by a third-party manager must, viewed broadly, form a distinct whole and be specific to, and essential for, the management of special investment funds (judgment in ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 65).
72. Functions specific to collective investment undertakings include, besides portfolio management functions, functions for administering the collective investment undertakings themselves, such as those set out — under the heading ‘Administration’ — in Annex II to the UCITS Directive (judgment in ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 66).
73. Thus, the Court has held that not only investment management involving the selection and disposal of the assets under management, but also administration and accounting tasks, in particular services such as computing the amount of income and the price of units or shares, the valuation of assets, accounting, the preparation of statements for the distribution of income, the provision of information and documentation for periodic accounts and for tax, statistical and VAT returns, and the preparation of income forecasts are covered by the concept of ‘management’ of a special investment fund for the purposes of Article 13B(d)(6) of the Sixth Directive (see judgments in Abbey National , C‑169/04, EU:C:2006:289, paragraphs 26, 63 and 64, and ATP PensionService , C‑464/12, EU:C:2014:139, paragraph 68).
74. On the other hand, the Court has also already held that the functions of depositary of undertakings for collective investment and mere material or technical supplies, such as the making available of a system of information technology, are not covered by Article 13B(d)(6) of the Sixth Directive (judgment in Abbey National , C‑169/04, EU:C:2006:289, paragraphs 65 and 71).
77. It must be noted in that regard that the specific activity of a special investment fund consists in the collective investment of capital raised (see, to that effect, judgment in GfBk , C‑275/11, EU:C:2013:141, paragraphs 22 and 24). Thus, where the assets of such a fund consist of immovable property, its specific activity includes, on the one hand, activities relating to the selection, purchase and sale of immovable property and, on the other, administration and accounting tasks, such as those mentioned in paragraph 73 of the present judgment.