Kvaerner plc v Staatssecretaris van Financiën.
Date: 2001-06-14
30 It should be remembered, at the outset, that the Court has consistently held that, in interpreting a provision of Community law, it is necessary to consider not only its wording but also the context in which it occurs and the objects of the rules of which it forms part (See Case 292/82 Merck [1983] ECR 3781, paragraph 12; Case 337/82 St Nikolaus Brennerei und Likörfabrik [1984] ECR 1051, paragraph 10; Case C-223/98 Adidas [1999] ECR I-7081, paragraph 23; Case C-301/98 KVS International [2000] ECR I-3583, paragraph 21; and Case C-156/98 Germany v Commission [2000] ECR I-6857, paragraph 50).
38 In this respect, the wording of Article 3 of the Directive reproduces the terms of the judgment in Case 205/84 Commission v Germany [1986] ECR 3755, paragraph 21, which was delivered one and a half years before its adoption. In that judgment, the Court had to determine the type of presence which, although not formally constituting a branch or agency, was nevertheless sufficiently permanent to evidence the establishment of the undertaking in another Member State and therefore fell under the provisions of the Treaty relating to the right of establishment rather than those relating to freedom to provide services. At paragraph 21 of the judgment, the Court held that an insurance undertaking of a Member State which maintains in another Member State a permanent presence that does not take the form of a branch or agency, but consists merely of an office managed by the undertaking's own staff or [of] a person who is independent but authorised to act on a permanent basis for the undertaking, as would be the case with an agency, came within the scope of the provisions of the Treaty on the right of establishment and not within the scope of the provisions on freedom to provide services.
44 It is clear from Article 2(d), first to fourth indents, of the Directive that the Community legislature intended to propose, for all types of risk insured, a solution enabling the State where the risk is situated to be determined on the basis of concrete and physical, rather than legal criteria. The purpose was that there should be a concrete factor corresponding to each risk which would allow it to be localised in a specific Member State.
46 Article 2(d), final indent, of the Directive was intended to enable the Member State where the risk is situated to be determined in all cases not provided for in the previous indents. So, the objective of Article 2(d), final indent, is in particular to lay down a residual rule for the determination of the place where a business risk is situated when that risk is not specifically linked to a building, a vehicle or travel. To that end, emphasis is placed on the place where the activity whose risk is covered by the contract is exercised. For that purpose, the legislature had recourse to the criterion of the policy-holder's habitual residence where he is a natural person and to the criterion of the establishment to which the contract relates where the policy-holder is a legal person.
52 As the Commission has pointed out, the aim of the Community legislature was to ensure, by the combined provisions of Articles 2(d), final indent, and 25 of the Directive, that as far as possible power to tax should be recognised on the basis of a concrete and objective criterion, ignoring the legal situation of the policy-holder and concentrating on the location of the activities the risks of which are covered. To interpret establishment in Article 2(d), final indent, as excluding subsidiaries would allow the concept of the location of the risk, and therefore tax liability, to be artificially exploited, which would run counter to the objective of attenuating disturbances of competition pursued by the Directive. Such an interpretation could also have the effect of making it impossible in certain circumstances to determine the location of the risk. Such possibilities cannot be reconciled with the intention underlying Article 25 of the Directive.