Finanzamt Bingen-Alzey v Boehringer Ingelheim Pharma GmbH & Co. KG.
Date: 2017-12-20
24


The referring court recalls that when a manufacturer of a product who, having no contractual relationship with the final consumer but being the first link in a chain of transactions which ends with that final consumer, grants the final consumer a price reduction, the taxable amount for VAT purposes must, in accordance with the case-law of the Court, be reduced by that reduction (see to that effect, the judgments of the Court of Justice of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraphs 28 and 31, and of 16 January 2014, Ibero Tours, C‑300/12, EU:C:2014:8, paragraph 29).
25


It observes that the Court of Justice has, however, ruled that there should be no reduction when a travel agent, acting as an intermediary, grants to the final consumer, on the travel agent’s own initiative and at his own expense, a price reduction on the principal service provided by the tour operator (judgment of 16 January 2014, Ibero Tours, C‑300/12, EU:C:2014:8, paragraph 33). The ground relied on by the Court in that judgment is that the travel agent is not part of a supply chain leading from the tour operator to the final consumer.
28


It also recalls that, although infringement of the principle of fiscal neutrality may be envisaged only as between competing traders, infringement of the general principle of equal treatment may be established, in matters relating to tax, by other kinds of discrimination which affect traders who are not necessarily in competition with each other but who are nevertheless in a similar situation in other respects (judgments of 10 April 2008, Marks & Spencer, C‑309/06, EU:C:2008:211, paragraph 49, and of 25 April 2013, Commission v Sweden, C‑480/10, EU:C:2013:263, paragraph 17). It follows that the principle of equal treatment, in matters relating to tax, does not coincide with the principle of fiscal neutrality (judgment of 25 April 2013, Commission v Sweden, C‑480/10, EU:C:2013:263, paragraph 18).
29


In those circumstances, the Bundesfinanzhof (Federal Finance Court) decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:
‘On the basis of the case-law of the Court of Justice of the European Union (judgment of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraphs 28 and 31) and having regard to the principle of equal treatment under EU law, is a pharmaceutical company which supplies medicinal products entitled to a reduction of the taxable amount under Article 90 of the VAT Directive in the case where:





–


it supplies those medicinal products to pharmacies via wholesalers,








–


the pharmacies supply those products, subject to tax, to persons with private health insurance,








–


the insurer of the medical expense insurance (the private health insurance company) reimburses the persons insured by it for the costs of purchasing the medicinal products, and








–


the pharmaceutical company is required to pay a “discount” to the private health insurance company pursuant to a statutory provision?’
30


By its question, the referring court asks, in essence, whether, in the light of the principles defined by the Court in the judgment of 24 October 1996, Elida Gibbs (C‑317/94, EU:C:1996:400, paragraphs 28 and 31), regarding the determination of the taxable amount for VAT and having regard to the principle of equal treatment under EU law, Article 90(1) of the VAT Directive must be interpreted as meaning that the discount granted, in accordance with national law, by a pharmaceutical company to a private health insurance company results, for the purposes of that article, in a reduction of the taxable amount in favour of that pharmaceutical company, when it supplies medicinal products via wholesalers to pharmacies which make supplies to persons covered by private health insurance that reimburses the purchase price of the medicinal products to persons it insures.
32


Next, it must also be recalled that Article 90(1) of the VAT Directive, which relates to cases of cancellation, refusal or total or partial non-payment, or where the price is reduced after the supply takes place, requires the Member States to reduce the taxable amount and, consequently, the amount of VAT payable by the taxable person whenever, after a transaction has been concluded, part or all of the consideration has not been received by the taxable person. That provision embodies one of the fundamental principles of the VAT Directive, according to which the taxable amount is the consideration actually received and the corollary of which is that the tax authorities may not collect an amount of VAT exceeding the tax which the taxable person received (judgment of 15 May 2014, Almos Agrárkülkereskedelmi, C‑337/13, EU:C:2014:328, paragraph 22 and the case-law cited).
33


Finally, the Court has held that one of the principles on which the VAT system was based was neutrality, in the sense that within each country similar goods should bear the same tax burden whatever the length of the production and distribution chain (judgment of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraph 20).
35


Thus, as a result of that legislation, Boehringer Ingelheim Pharma could dispose of a sum corresponding to the price of the sale of those products to pharmacies, reduced by that discount. It would not therefore be in conformity with the VAT Directive for the taxable amount used to calculate the VAT chargeable to the pharmaceutical company, as a taxable person, to exceed the sum finally received by him. If that were the case, the principle of neutrality of VAT vis-à-vis taxable persons, of whom the pharmaceutical company is one, would not be complied with (see, to that effect, the judgment of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraph 28).
38


However, in that regard, it must be held, first, that, also in paragraph 31 of that judgment, the Court stated that that provision is an expression of the principle of neutrality and, consequently, its application must not undermine the achievement of that principle (see, to that effect, the judgment of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraph 31).
39


In the second place, it is clear from the case-law of the Court that Article 90(1) of the VAT Directive does not presuppose such a subsequent modification of the contractual relations in order for it to be applicable. In principle, it requires the Member States to reduce the taxable amount whenever, after a transaction has been concluded, part or all of the consideration has not been received by the taxable person. Moreover, there is no indication that in its judgment of 24 October 1996, Elida Gibbs (C‑317/94, EU:C:1996:400), the Court wished to restrict the scope of application of Article 11C(1) of the Sixth Directive which corresponds to Article 90 of the VAT Directive. On the contrary, it is apparent from the facts of the Elida Gibbs case that there had been no modification of the contractual relations. Nevertheless, the Court held that Article 11C(1) of the Sixth Directive was applicable (see, to that effect, the judgment of 29 May 2001, Freemans, C‑86/99, EU:C:2001:291, paragraph 33).
40


Furthermore, the fact that, in the case in the main proceedings, the direct beneficiary of the supplies of the medicinal products in question was not the private health insurance company which reimbursed the insured persons but the insured persons themselves, is not such as to break the direct link between the supply of services made and the consideration received (see, by analogy, the judgment of 27 March 2014, Le Rayon d’Or, C‑151/13, EU:C:2014:185, paragraph 35).
41


As the Advocate General observed in points 44 and 45 of his opinion, the payments made at the point of purchase of the medicinal products must be regarded as consideration provided by a third party within the meaning of Article 73 of the VAT Directive when those third parties, namely insured persons, requested reimbursement by the private health insurance companies and the latter obtained, in accordance with the national law, the discount owed to them by the pharmaceutical company. Therefore, having regard to the facts at issue in the main proceedings, the private health insurance companies must be regarded as being the final consumer of a supply made by a pharmaceutical company, which is a taxable person for the purposes of VAT, such that the amount payable to the tax authority may not exceed that paid by the final consumer (see, to that effect, the judgment of 24 October 1996, Elida Gibbs, C‑317/94, EU:C:1996:400, paragraph 24).
43


Moreover, as regards the discount at issue in the main proceedings, it must be held that that discount is fixed by the law and that the pharmaceutical company is obliged to grant it to private health insurance companies which have reimbursed the persons they insure for the expenses incurred by those persons when purchasing medicinal products. As has been stated in paragraph 35 above, in those circumstances, the pharmaceutical company was not able freely to dispose of the full amount of the price received on the sale of its products to pharmacies or to wholesalers (see, to that effect, the judgment of 19 July 2012, International Bingo Technology, C‑377/11, EU:C:2012:503, paragraph 31).
46


Having regard to the foregoing considerations, the answer to the question referred is that, in the light of the principles defined by the Court in the judgment of 24 October 1996, Elida Gibbs (C‑317/94, EU:C:1996:400, paragraphs 28 and 31), regarding the determination of the taxable amount for VAT and having regard to the principle of equal treatment under EU law, Article 90(1) of the VAT Directive must be interpreted as meaning that the discount granted, under national law, by a pharmaceutical company to a private health insurance company results, for the purposes of that article, in a reduction of the taxable amount in favour of that pharmaceutical company, where it supplies medicinal products via wholesalers to pharmacies which make supplies to persons covered by private health insurance that reimburses the purchase price of the medicinal products to persons it insures.