C-231/07 Tiercé Ladbroke and Derby

Order · Court of Justice · Belgium · 14 May 2008

Betting agents and the exemption for transactions concerning payments

What is the case?

Ladbroke and Derby, in joined Belgian references, engaged agents to run their betting business at local level. The agents accepted bets on horse races and other sporting events on behalf of the bookmaker, registered them, issued the betting slip confirming the bet, collected the stakes, paid out winnings, and alone bore liability towards the bookmaker for the management of the funds collected and for theft or loss of money. They were remunerated by commission. The question was whether that bundle of activities was exempt as a financial service.

What is the Court asked?

Whether the expression 'transactions, including negotiation, concerning deposit accounts and payments' in Article 13B(d)(3) of the Sixth Directive covers the services supplied by such an agent acting on behalf of a client whose business is the acceptance of bets, where the agent collects the stakes, pays the winnings and assumes sole liability for the funds handled.

The Court’s decision

Ruling by order, the Court held that the exemption does not extend to those services. Although money passes through the agent's hands in both directions, the activity taken as a whole is the acceptance and administration of bets on behalf of the bookmaker, not a transaction concerning deposit accounts or payments within the meaning of the financial exemption, which must be interpreted strictly. A useful boundary marker for Article 135(1)(d) of the VAT Directive.

AI-generated and factual. Not an official document: verify against the text below.

Legislation interpreted

Article 13 of Sixth Directive 77/388/EEC Exemptions

Subject matter

Sixth VAT Directive · Article 13B(d)(3) · Exemptions · Concepts of ‘deposit accounts’ and of ‘payments’ · Refusal of exemption

Topics

Exemptions · Concepts of deposit accounts and of payments · Refusal of exemption

Record

Court: Court of Justice
Case number: C-231/07 (joined with C-232/07)
ECLI: ECLI:EU:C:2008:275
Official texts: Order of 14 May 2008 (62007CO0231)
Cite as: Order of 14 May 2008, Tiercé Ladbroke and Derby, C-231/07, EU:C:2008:275

Order of 14 May 2008

Text as published by the Court on EUR-Lex, CELEX 62007CO0231.

Order of the Court (Eighth Chamber) of 14 May 2008 – Ladbroke and Derby v État belge

(Joined Cases C‑231/07 and C-232/07)

Rules of Procedure – First subparagraph of Article 104(3) – Sixth VAT Directive – Article 13B(d)(3) – Exemptions – Concepts of ‘deposit accounts’ and of ‘payments’ – Refusal of exemption

Tax provisions – Harmonisation of laws – Turnover taxes – Common system of value added tax – Exemptions provided for in the Sixth Directive (Council Directive 77/388, Art. 13B(d)(3)) (see paras 22, 24-25, operative part)

Re:

Operative part

The terms ‘transactions, including negotiation, concerning deposit accounts and payments’ used in Article 13B(d)(3) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes – Common system of value added tax: uniform basis of assessment are to be interpreted as meaning that they do not refer to the supply of services by an agent acting on behalf of a client which carries out the activity of accepting bets on horse races and other sporting events, consisting of acceptance by the agent of bets on behalf of the client, registration thereof, confirmation to the client, by presentation of the betting slip, that a bet was made, collection of funds, payment of winnings, the sole assumption of liability as regards the client for the management of the funds collected and for thefts and/or losses of money and where the agent receives remuneration in the form of commission from the client in return for that activity.