Christoph-Dornier-Stiftung für Klinische Psychologie v Finanzamt Gießen.
Date: 2003-11-06
33. As stated by the Court in paragraph 22 of  Commission  v  France , cited above, Article 13A(1)(b) of the Sixth Directive does not include any definition of the concept of activities   " closely related"  to hospital and medical care. None the less, it is apparent from the very terms of that provision that it does not envisage services which are unrelated to hospital care for the patients receiving those services or to any medical care which they might receive.
34. In this case, it is common ground that the psychotherapeutic treatment given in Dornier ' s out-patient facility by qualified psychologists generally constitutes services provided to the patients as an end in themselves and not as a means of better enjoying other types of services. In so far as that treatment is not ancillary to hospital or medical care, it is not an activity   " closely related"  to services exempted under Article 13A(1)(b) of the Sixth Directive.
35. Accordingly, the Court finds that psychotherapeutic treatment given in an out-patient facility of a foundation governed by private law by qualified psychologists who are not doctors is an activity   " closely related"  to hospital or medical care within the meaning of Article 13A(1)(b) of the Sixth Directive only when such treatment is actually given as a service ancillary to the hospital or medical care received by the patients in question and constituting the principal service.
The term of   " medical care"
─ Observations submitted to the Court
42. According to the Court ' s case-law, the exemptions envisaged in 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 in particular Case C-2/95  SDC  [1997] ECR I-3017, paragraph 20; and  Kügler , cited above, paragraph 28). However, the interpretation of the terms used in that provision 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.
43. It is apparent from the case-law that the objective of reducing the cost of medical care and making that care more accessible to individuals is common to both the exemption provided for in Article 13A(1)(b) of the Sixth Directive and that in letter (c) of the same provision (see  Commission  v  France , cited above, paragraph 23; and  Kügler , cited above, paragraph 29).
44. It must also be borne in mind that the principle of fiscal neutrality precludes, inter alia, economic operators carrying on the same activities from being treated differently as far as the levying of VAT is concerned ( Kügler , cited above, paragraph 30).
47. Next, as correctly pointed out by the Advocate General in points 44 to 46 of her Opinion, the criterion for drawing a clear distinction between the two tax exemptions provided for in Article 13A(1)(b) and (c) is less the nature of the service than the place where it is provided. The Court has held that, under Article 13A(1)(b), it is appropriate to exempt services encompassing a whole range of medical care in establishments pursuing social purposes such as the protection of human health, whereas letter (c) of the same provision exempts services provided outside hospitals and within the framework of a confidential relationship between the patient and the person providing the care ( Commission  v  United Kingdom , cited above, paragraph 33). Whilst it is true that the Court in that case found that the exemption of supplies of goods effected in connection with the provision of medical care envisaged in Article 13A(1)(c) could not be justified under letter (b) of the same provision, that interpretation follows inter alia from the fact that the latter provision covers duly recognised establishments pursuing social purposes and provides expressly for exemption of activities which are closely linked to medical care; the same cannot be said of Article 13A(1)(c).
48. It should also be borne in mind that, given the objective of reducing health care costs, the term   " medical care"  in Article 13A(1)(b) does not call for an especially narrow interpretation (see, to that effect,  Commission  v  France , cited above, paragraph 23).  However, the services covered by that term, like those covered by   " provision of medical care"  in letter (c) of the same provision, must have as their purpose the diagnosis, treatment and, in so far as possible, cure of diseases or health disorders ( D. , cited above, paragraph 18; and  Kügler , cited above, paragraph 38). It is not disputed that the treatment provided by qualified psychologists in a hospital environment fulfils the condition of having a therapeutic purpose.
49. Lastly, it must be pointed out that that interpretation of the term   " medical care"  in Article 13A(1)(b) is in keeping with the principle of fiscal neutrality because paramedical services, such as treatment given by qualified psychologists, are exempt from VAT regardless of where they are provided.
50. It follows from the foregoing considerations that the term   " medical care"  in Article 13A(1)(b) of the Sixth Directive must be interpreted as covering all provision of medical care envisaged in letter (c) of the same provision, including services provided by persons who are not doctors but who provide paramedical services, such as psychotherapeutic treatment given by qualified psychologists.
64. As regards the term   " other duly recognised establishments of a similar nature" , Article 13A(1)(b) of the Sixth Directive does not specify the conditions and procedures for that recognition. It is thus, in principle, for the national law of each Member State to lay down the rules according to which such recognition may be granted to establishments which request it.
65. The adoption of national rules in this area is, moreover, provided for in Article 13A(2)(a) of the Sixth Directive, which states that   " Member States may make the granting to bodies other than those governed by public law of each exemption provided for in (1)(b) ... subject in each individual case to one or more of the ... conditions"  referred to therein.
66. However, since Article 13A(2)(a) does not require the Member States to take such measures, the fact that a Member State has not exercised that option does not affect the possibility that an establishment may be recognised for the purposes of granting the exemptions referred to.
69. It should be borne in mind in this context that, as regards Article 13A(1)(g) of the Sixth Directive, the Court has held that where a taxable person seeks the status of charitable organisation, it is for the national courts to examine whether the competent authorities have observed the limits on their discretion under that provision while applying Community principles, in particular the principle of equal treatment ( Kügler , cited above, paragraph 56).
70. It follows from the answer given by the Court to the first question that the condition requiring that the treatment be provided under medical supervision, in so far as it is intended to preclude the exemption from applying to treatment given under the sole responsibility of members of paramedical professions, goes beyond the limits of the discretion allowed to the Member States under Article 13A(1)(b) of the Sixth Directive. The term   " medical care"  in that provision covers not only treatment provided directly by doctors or other health professionals under medical supervision, but also paramedical services given in hospitals under the sole responsibility of persons who are not doctors.
71. It follows that, for the purposes of the exemption provided for in Article 13A(1)(b) of the Sixth Directive, a Member State may not validly make recognition of establishments subject to a condition requiring that paramedical services provided by those establishments be given under medical supervision.
72. In paragraphs 57 and 58 of  Kügler , cited above, the Court added that, in order to determine which organisations should be recognised as charitable within the meaning of Article 13A(1)(g) of the Sixth Directive, the national authorities should, in accordance with Community law and subject to review by the national courts, take a number of factors into consideration. Those factors include the public interest of the activities of the taxable person in question, the fact that other taxable persons carrying on the same activities already have similar recognition, and the fact that the costs incurred for the treatment in question may be largely met by health insurance schemes or other social security bodies.
73. As correctly pointed out by the Advocate General in point 55 of her Opinion, those statements appear to apply equally to the interpretation of Article 13A(1)(b) of the Sixth Directive as regards recognition of the establishments referred to in that provision.
75. It is in this light that it is appropriate to take account of the fact that the social security authorities do not reimburse, or only partially reimburse, patients for the costs of psychotherapeutic treatment. If Dornier ' s situation is comparable in this respect to that of other operators providing the same treatment, the mere fact that the cost of that treatment is not fully cove red by the social security authorities does not justify a difference in the treatment of providers for VAT purposes.
78. It must be borne in mind that, in accordance with settled case-law (see, in particular, Case 8/81  Becker  [1982] ECR 53, paragraph 25; Case C-193/91  Mohsche  [1993] ECR I-2615, paragraph 17; Case C-134/99  IGI  [2000] ECR I-7717, paragraph 36; and  Kügler , cited above, paragraph 51), wherever the provisions of a directive appear, so far as their subject-matter is concerned, to be unconditional and sufficiently precise, those provisions may, in the absence of implementing measures adopted within the prescribed period, be relied upon as against any national provision which is incompatible with the directive or in so far as the provisions define rights which individuals are able to assert against the State.
79. In addition, although Article 13A(1) of the Sixth Directive provides that the Member States are to apply the exemptions prescribed by that provision   " under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of such exemptions and of preventing any possible evasion, avoidance or abuse" , a Member State may not rely, as against a taxpayer who is able to show that his tax position actually falls within one of the categories of exemption laid down in the Sixth Directive, on its failure to adopt the very provisions which are intended to facilitate the application of that exemption ( Kügler , cited above, paragraph 52).
80. As regards the content of Article 13A(1)(b) and (c) of the Sixth Directive, the Court finds that, contrary to the assertions of the German Government, those provisions indicate in a sufficiently precise and unconditional manner the activities to which the exemption applies (see, by analogy, as regards Article 13A(1)(g) of the Sixth Directive,  Kügler , cited above, paragraph 53).
81. The fact that those provisions confer discretion on the Member States to determine, first, which establishments are not   " governed by public law"  but which may benefit from the exemption provided for in Article 13A(1)(b) and, second, for which paramedical professions the exemption provided for in letter (c) of the same provision may be granted, does not prevent individuals who, according to objective criteria, provide treatment in the public interest envisaged by those exemptions, from relying directly on the provisions of the Sixth Directive as against national provisions which do not comply with that directive.
82. In the present case, it follows from the answer given to the second question that the national rules pertaining to recognition of an establishment for the purposes of the exemption provided for in Article 13A(1)(b) of the Sixth Directive contain a restriction incompatible with the terms of that provision. The taxable person may therefore rely directly, in the national court, on Article 13A(1)(b) of the Sixth Directive to contest the application of a rule of national law requiring that the treatment be provided under medical supervision. However, it also follows from the answer to the second question that, in order for it to obtain recognition as an   " other duly recognised establishment of a similar nature"  and thus to benefit from the exemption provided for in Article 13A(1)(b) of the Sixth Directive, the national court must determine, in the light of all the relevant factors, in particular the circumstances of the case in the main proceedings, whether the taxable person satisfies the conditions of application of that exemption.