C-326/15 DNB Banka

JUDGMENT OF THE COURT (Fourth Chamber)

21 September 2017 ( *1 )

(Reference for a preliminary ruling — Taxation — Value added tax — Directive 2006/112/EC — Article 132(1)(f) — Exemptions for certain activities in the public interest — Exemption for the supply of services by independent groups of persons for their members — Applicability to financial services)

In Case C‑326/15,

REQUEST for a preliminary ruling under Article 267 TFEU from the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia), made by decision of 9 June 2015, received at the Court on 1 July 2015, in the proceedings

‘DNB BANKA’ AS

v

Valsts ienemumu dienests,

THE COURT (Fourth Chamber),

composed of T. von Danwitz, President of the Chamber, E. Juhász, C. Vajda (Rapporteur), K. Jürimäe and C. Lycourgos, Judges,

Advocate General: J. Kokott,

Registrar: M. Aleksejev, Administrator,

having regard to the written procedure and further to the hearing on 30 June 2016,

after considering the observations submitted on behalf of:

‘DNB Banka’ AS, by M. Kairovs, J. Teteris and I. Sloka,

the Latvian Government, by A. Bogdanova, I. Kucina, D. Pelše and I. Kalniņš, acting as Agents,

the German Government, by T. Henze, acting as Agent,

the Greek Government, by K. Nasopoulou and A. Dimitrakopoulou, acting as Agents,

the Luxembourg Government, by D. Holderer, acting as Agent, assisted by F. Kremer and P.-E. Partsch, avocats,

the Hungarian Government, by M.Z. Fehér and G. Koós, acting as Agents,

the Polish Government, by B. Majczyna, B. Majerczyk-Graczykowska and K. Maćkowska, acting as Agents,

the Portuguese Government, by L. Inez Fernandes and R. Campos Laires, acting as Agents,

the United Kingdom Government, initially by S. Simmons, and subsequently by C. R. Brodie and D. Robertson, acting as Agents, assisted by O. Thomas, QC,

the European Commission, by M. Owsiany-Hornung and A. Sauka, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 1 March 2017,

gives the following

Judgment

Legal context and the dispute

1This request for a preliminary ruling concerns the interpretation of Article 132(l)(f) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1).

2The request has been made in proceedings between ‘DNB Banka’ AS and the Valsts ieņēmumu dienests (National Tax Authority, Latvia) (‘the VID’) concerning the latter’s refusal of the request submitted by DNB Banka to have its value added tax (VAT) declarations corrected.

Legal context

EU law

The Sixth Directive

3Sixth 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 (OJ 1977 L 145, p. 1, ‘the Sixth Directive’) was repealed and replaced, as from 1 January 2007, by Directive 2006/112. Article 13 of the Sixth Directive provided:

‘A. Exemptions for certain activities in the public interest

1. Without prejudice to other Community provisions, Member States shall exempt the following under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of the exemptions and of preventing any possible evasion, avoidance or abuse:

…

the supply of services by independent groups of persons, who are carrying on an activity which is exempt from VAT or in relation to which they are not taxable persons, for the purpose of rendering their members the services directly necessary for the exercise of that activity, where those groups merely claim from their members exact reimbursement of their share of the joint expenses, provided that such exemption is not likely to cause distortion of competition;

…’

Directive 2006/112

4Directive 2006/112 contains a Title IX, entitled ‘Exemptions’, of which Chapter 1 is entitled ‘General Provisions’.

5Article 132(1) of Directive 2006/112, which appears in Chapter 2, entitled ‘Exemptions for certain activities in the public interest’, of Title IX of that directive, provides:

‘Member States shall exempt the following transactions:

…

the supply of services by independent groups of persons, who are carrying on an activity which is exempt from VAT or in relation to which they are not taxable persons, for the purpose of rendering their members the services directly necessary for the exercise of that activity, where those groups merely claim from their members exact reimbursement of their share of the joint expenses, provided that such exemption is not likely to cause distortion of competition;

…’

6Article 135(1) of Directive 2006/112, which appears in Chapter 3, entitled ‘Exemptions for other activities’, of Title IX of that directive, provides:

‘Member States shall exempt the following transactions:

…

transactions, including negotiation, concerning deposit and current accounts, payments, transfers, debts, cheques and other negotiable instruments, but excluding debt collection;

transactions, including negotiation, concerning currency, bank notes and coins used as legal tender, with the exception of collectors’ items, that is to say, gold, silver or other metal coins or bank notes which are not normally used as legal tender or coins of numismatic interest;

…’

Latvian law

7Article 6(1)(17) of the likums par pievienotās vērtības nodokli (Law on value added tax) of 9 March 1995 (Latvijas Vēstnesis, 1995, No 49), in the version applicable to the main proceedings, provides for the exemption of the financial transactions listed in that provision.

8During the period at issue in the main proceedings, Article 132(1)(f) of Directive 2006/112 had not yet been transposed into national law. On 1 January 2013, a new Law on value added tax entered into force, the Pievienotās vērtības nodokļa likums (‘Law on value added tax’) of 29 November 2012. Article 52 of that law, in the version which entered into force on 1 January 2014, provides, in paragraph 3.2, that services supplied by a member of an independent group of persons (‘IGP’) to other persons in that group are exempt under certain circumstances.

The dispute in the main proceedings and the questions referred for a preliminary ruling

9DNB Banka is a credit institution, established in Latvia, which provides financial services.

10DNB Banka is a subsidiary of DNB NORD A/S (now DNB INVEST DENMARK A/S), a company established in Denmark, which also owns two other subsidiaries, AB DNB NORD Bankas, a Lithuanian company, and Bank DNB Polska SA, a Polish company, as well as an Estonian branch, DNB NORD Pank. All those entities, which are active in the area of financial services, make up the DNB Group.

11DNB NORD is also the sole owner of DNB NORD IT A/S (now, after restructuring, DNB INVEST DENMARK) (‘DNB IT’), a company established in Denmark tasked with providing support in the area of information technology.

12DNB NORD is a subsidiary of DNB Bank ASA, established in Norway, and of NORD/LB Norddeutsche Landesbank, established in Germany. Both those companies form a joint undertaking through which DNB Bank holds 51% of the shares in the DNB Group.

13On 31 August 2006, DNB Banka concluded a contract with DNB NORD for the provision of financial services. Under that contract, DNB NORD provides services to DNB Banka on a continuous basis and to the extent necessary, ensuring the group’s joint functions and responding to specific requests from DNB Banka as its subsidiary. On the basis of that contract, DNB Banka received, in 2009 and 2010, a number of invoices pertaining to the management services provided by DNB NORD. According to the documentation relating to the transfer pricing, drawn up in 2011, DNB NORD applied a 5% uplift, in 2009 and 2010, to the pricing for the provision of management services.

14On 30 April 2009, DNB Bank, in agreement with DNB Banka, concluded a contract with Microsoft Ireland Operations Ltd relating to the purchase of products and licences marketed by Microsoft for the needs of DNB Bank and its connected undertakings. Under that contract, DNB Bank receives an invoice from Microsoft Ireland Operations for software purchased which all of the undertakings in the DNB Group use. Subsequently, DNB Bank allocates the relevant costs to the other undertakings in the DNB Group on the basis of the specific programs which each undertaking has received. In 2009 and 2010, DNB Banka thus received invoices pertaining to the licences marketed by Microsoft.

15On 20 December 2010, DNB IT concluded a contract relating to information technology management with DNB NORD and with its subsidiaries, according to which DNB IT is the only entity in the DNB Group to provide services connected with information technology projects. In 2010 and 2011, DNB IT, on the basis of that contract, sent a number of invoices to DNB Banka for the information technology services thus provided. According to the items relating to costs referred to in those invoices, an uplift of 5% was applied to the pricing of those services.

16DNB Banka was the subject of a tax inspection in which it maintained that the transactions concerned were exempt from VAT. The administrative procedure was concluded with a decision of the Director General of the VID of 9 July 2012, in which she rejected DNB Banka’s request that its VAT declarations relating to the transactions concluded with DNB NORD, DNB IT and DNB Bank be corrected.

17That decision is based on the following considerations. In the first place, as regards the transactions carried out between DNB Banka and DNB NORD, the VID found that there were no documents which made it possible to identify clearly the persons which formed the IGP, for the purposes of Article 132(1)(f) of Directive 2006/112. The VID considered that the fact that there was a group of connected undertakings whose members provided each other with services did not demonstrate the existence of an IGP, for the purposes of that provision.

18In the second place, the VID, referring to recital 7 of Directive 2006/112, took the view that the transactions carried out between DNB Banka and DNB IT amounted to unfair competition. That assessment is based on the fact that the service provider, DNB IT, is liable to pay tax for the information technology services in question in its Member State of establishment, in accordance with general arrangements, and that the input tax on those services has been deducted, while DNB Banka, as recipient of those services, is not liable to pay tax for those same services, as they are considered to be exempt from VAT.

19In the third place, as regards the transactions carried out between DNB Banka and DNB Bank, the VID was unable to identify specifically the persons which, according to DNB Banka, had to be classified as members of the IGP for whose services exemption was invoked. In addition, according to the VID, there is no justification for considering that DNB Bank had to be classified as a member of that IGP carrying on an activity exempt from VAT.

20DNB Banka submitted an application to the administratīvā rajona tiesa (District Administrative Court, Latvia) for an order requiring the VID to correct its VAT declarations relating to the transactions conducted with DNB NORD, DNB IT and DNB Bank. That court dismissed that application by decision of 1 November 2013.

21DNB Banka lodged an appeal against that decision before the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia), claiming that all the criteria referred to in Article 132(1)(f) of Directive 2006/112 had been fulfilled. According to DNB Banka, the administratīvā rajona tiesa (District Administrative Court) did not interpret Article 132(1)(f) of Directive 2006/112 correctly when it dismissed its application on the ground that the total amount of the invoice also included an uplift, without examining the reasons justifying the existence of that uplift. DNB Banka maintains that that uplift was included in compliance with the guidelines of the Organisation for Economic Co-operation and Development (OECD) and with the requirements of corporation tax legislation, and consequently the application of such an uplift cannot be used as a ground for refusing an exemption from VAT.

22In those circumstances, the Administratīvā apgabaltiesa (Regional Administrative Court) decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:

Is it possible for there to be an [IGP], for the purposes of Article 132(1)(f) of Directive [2006/112], when the members of the [IGP] are established in separate Member States of the European Union in which that provision of the directive has been transposed with different requirements which are not compatible?

Can a Member State restrict the right of a taxable person to apply the exemption provided for in Article 132(1)(f) of Directive [2006/112], when that taxable person has satisfied all the requirements for the application of the exemption in its Member State, but that provision of the directive has been transposed into the national law of the Member States of other members of the [IGP] with restrictions which limit the possibility for taxable persons of other Member States of applying in their own Member State the corresponding exemption from VAT?

Is it permissible to apply the exemption in Article 132(1)(f) of Directive [2006/112] to services in the Member State of the recipient of those services, which is a taxable person for [VAT], when the provider of the services, also a taxable person for [VAT], has applied in another Member State [VAT] to those services in accordance with general arrangements, that is, considering that [VAT] on those services was payable in the Member State of the recipient of those services, in accordance with Article 196 of Directive [2006/112]?

Must the term ‘[IGP]’, for the purposes of Article 132(1)(f) of Directive [2006/112], be taken to mean a separate legal person whose existence has to be proved through a specific agreement creating that [IGP]?

If the reply to that question is that an [IGP] need not necessarily be taken to mean a separate entity, is an [IGP] to be regarded as a group of related undertakings in which, in the course of their usual economic activities, those undertakings provide each other with support services for carrying out their commercial activities, and may the existence of that [IGP] be proved through the contracts for services concluded or through documentation on transfer prices?

Can a Member State restrict the right of a taxable person to apply the [VAT] exemption in Article 132(1)(f) of Directive [2006/112], when that taxable person has applied an uplift to the transactions, as required under the legislation on direct taxation of the Member State where the taxable person is established?

Does the exemption in Article 132(1)(f) of Directive [2006/112] apply to services received from third countries? In other words, where a member of an [IGP], as referred to in Article 132(1)(f) of Directive [2006/112], provides, within that [IGP], services to other members of the [IGP], can that person be a taxable person from a third country?’

Consideration of the questions referred

23As a preliminary point, it should be observed that DNB Banka is a credit institution whose activities consist in providing financial services. According to that company, the services supplied to it by other entities belonging to the same group of companies, that is to say, DNB NORD, DNB IT and DNB Bank, come under the exemption in Article 132(1)(f) of Directive 2006/112. Since that provision was not transposed into national law during the period at issue in the main proceedings, DNB Banka requested that it be applied directly to the dispute in the main proceedings.

24In that context, all the questions referred concern the interpretation of Article 132(1)(f) of Directive 2006/112 which provides for an exemption of the supply of services by independent groups of persons, which are carrying on an activity which is exempt from VAT or in relation to which they are not taxable persons for the purpose of rendering their members the services directly necessary for the exercise of that activity.

25Before replying to those questions it is necessary to examine the issue whether that provision applies in circumstances such as those in the main proceedings which concern services provided by an IGP whose members carry on an economic activity in the area of financial services.

26According to settled case-law, in the procedure laid down by Article 267 TFEU providing for cooperation between national courts and the Court of Justice, it is for the latter to provide the referring court with all those elements for the interpretation of EU law which may be of assistance in adjudicating on the case pending before it, whether or not the referring court has specifically referred to them in its question (judgment of 20 October 2016, Danqua, C‑429/15, EU:C:2016:789, paragraph 37 and the case-law cited).

27In those circumstances, it is also necessary to provide the referring court with guidance on the issue whether Article 132(1)(f) of Directive 2006/112 is intended to apply to the services provided by an IGP whose members carry on an economic activity in the area of financial services which are directly necessary for the exercise of that activity.

28In that regard, it should be pointed out that the terms of that provision, which refer to an exempt activity of the members of an IGP, do not preclude the possibility of that exemption being applied to the services of an IGP whose members carry on an economic activity in the area of financial services, inasmuch as Article 135(1)(d) of that directive exempts financial services.

29However, according to settled case-law, it is necessary, when interpreting a provision of EU law, to consider not only its wording but also the context in which it occurs and the objectives pursued by the rules of which it is part (judgments of 26 April 2012, Able UK, C‑225/11, EU:C:2012:252, paragraph 22, and of 4 April 2017, Fahimian, C‑544/15, EU:C:2017:255, paragraph 30 and the case-law cited).

30As regards the context of Article 132(1)(f) of Directive 2006/112, it should be pointed out that that provision is included in Chapter 2, entitled ‘Exemptions for certain activities in the public interest’, of Title IX of that directive. That heading indicates that the exemption provided for in that provision refers only to those IGPs whose members carry on activities in the public interest.

31That interpretation is also confirmed by the structure of Title IX of that directive relating to ‘Exemptions’. Within Directive 2006/112, Article 132(1)(f) is included, not in Chapter 1, entitled ‘General Provisions’, of that title, but in Chapter 2. Moreover, in that title, a distinction is made between Chapter 2, entitled ‘Exemptions for certain activities in the public interest’, and Chapter 3, entitled ‘Exemptions for other activities’, a distinction which indicates that the rules laid down in Chapter 2 for certain activities in the public interest do not apply to the other activities referred to in Chapter 3.

32Chapter 3 includes, in Article 135(1), an exemption for certain transactions in the area of financial services, such as, in particular, ‘(d) transactions, including negotiation, concerning deposit and current accounts, payments, transfers, debts, cheques and other negotiable instruments’ and ‘(e) transactions, including negotiation, concerning currency, bank notes and coins used as legal tender’. It is thus clear from the general scheme of Directive 2006/112 that the exemption provided for in Article 132(1)(f) of Directive 2006/112 does not apply to transactions carried out in the area of financial services and that, accordingly, the services provided by IGPs whose members are active in that area do not come within that exemption.

33As regards the aim of Article 132(1)(f), within Directive 2006/112, it is necessary to recall the purpose of all of the provisions of Article 132 of that directive, which is to exempt from VAT certain activities in the public interest with a view to facilitating access to certain services and the supply of certain goods by avoiding the increased costs that would result if they were subject to VAT (judgment of 5 October 2016, TMD, C‑412/15, EU:C:2016:738, paragraph 30 and the case-law cited).

34Thus, the services provided by an IGP come within the exemption provided for in Article 132(1)(f) of Directive 2006/112 where the provision of those services contributes directly to the exercise of activities in the public interest referred to in Article 132 of that directive (see, by analogy, judgment of 5 October 2016, TMD, C‑412/15, EU:C:2016:738, paragraphs 31 to 33).

35In addition, it must be recalled that the scope of the exemptions referred to in Article 132 of Directive 2006/112 is 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, to that effect, judgment of 5 October 2016, TMD, C‑412/15, EU:C:2016:738, paragraph 34 and the case-law cited).

36It follows, therefore, that the supply of services which do not contribute directly to the exercise of activities in the public interest referred to in Article 132, but to the exercise of other exempt activities, in particular those referred to in Article 135 of that directive, cannot come under the exemption provided for in Article 132(1)(f) of Directive 2006/112.

37Accordingly, Article 132(1)(f) of Directive 2006/112 should be interpreted to the effect that the exemption provided for in that provision relates only to IGPs whose members carry on activities in the public interest referred to in that article. Therefore, services provided by IGPs, whose members carry on an economic activity in the area of financial services, which does not constitute an activity in the public interest, are not entitled to that exemption.

38In that regard, it should be pointed out that, unlike what it is doing in the present case, the Court, in the judgment of 20 November 2003, Taksatorringen (C‑8/01, EU:C:2003:621), did not resolve the question whether the exemption provided for in Article 13A(1)(f) of the Sixth Directive (corresponding to Article 132(1)(f) of Directive 2006/112) was limited to the services provided by an IGP whose members carried on activities in the public interest.

39However, it is clear from the information in the documents before the Court that the Court’s interpretation of the exemption provided for in Article 13A(1)(f) of the Sixth Directive in its judgment of 20 November 2003, Taksatorringen (C‑8/01, EU:C:2003:621), led to some Member States exempting services supplied by IGPs made up of entities such as insurance companies or undertakings active in the area of financial services.

40In that regard, it should, however, be noted that national authorities could not reopen tax periods which have been definitively closed, on the basis of Article 132(1)(f) of Directive 2006/112, as interpreted in paragraph 37 above (see, by analogy, judgments of 6 October 2009, Asturcom Telecomunicaciones, C‑40/08, EU:C:2009:615, paragraph 37, and of 21 December 2016, Gutiérrez Naranjo and Others, C‑154/15, C‑307/15 and C‑308/15, EU:C:2016:980, paragraph 68).

41As regards tax periods which have not yet been definitively closed, it must be recalled that, according to settled case-law, a directive cannot of itself impose obligations on an individual and cannot therefore be relied on as such against that individual (see, inter alia, judgment of 19 April 2016, DI, C‑441/14, EU:C:2016:278, paragraph 30 and the case-law cited). Thus, national authorities cannot rely on Article 132(1)(f) of Directive 2006/112, as interpreted in paragraph 37 above, in order to withhold that exemption from IGPs made up of entities such as credit institutions and, therefore, in order to refuse to exempt the supply of services by those IGPs from VAT.

42In addition, the obligation on a national court to refer to the content of a directive when interpreting and applying the relevant rules of domestic law is limited by general principles of law, particularly those of legal certainty and non-retroactivity, and that obligation cannot serve as the basis for an interpretation of national law contra legem (judgment of 15 April 2008, Impact, C‑268/06, EU:C:2008:223, paragraph 100).

43Therefore, the interpretation which the national court must give to the relevant rules of national law implementing Article 132(1)(f) of Directive 2006/112 must abide by the general principles of EU law, in particular the principle of legal certainty.

44In view of the foregoing, there is no need to reply to the first to sixth questions.

45In the light of all of the foregoing, the answer to the request for a preliminary ruling is that Article 132(1)(f) of Directive 2006/112 must be interpreted to the effect that the exemption provided for in that provision relates only to IGPs whose members carry on an activity in the public interest referred to in Article 132 of that directive and that, therefore, the services supplied by a group whose members carry on an economic activity in the area of financial services, which does not constitute such an activity in the public interest, are not entitled to that exemption.

Costs

46Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

Operative part

On those grounds, the Court (Fourth Chamber) hereby rules:

Article 132(1)(f) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted to the effect that the exemption provided for in that provision relates only to independent groups of persons whose members carry on an activity in the public interest referred to in Article 132 of that directive and that, therefore, the services supplied by a group whose members carry on an economic activity in the area of financial services, which does not constitute such an activity, in the public interest are not entitled to that exemption.

Signatures

[Signatures]

( *1 ) Language of the case: Latvian.

OPINION OF ADVOCATE GENERAL

KOKOTT

delivered on 1 March 2017 ¹

(Taxation — VAT — Article 132(1)(f) of Directive 2006/112/EC — Exemption for the supply of services by independent groups for their members — Direct effect of a directive — Definition of an ‘independent group of persons’)

I – Introduction

1In this request for a preliminary ruling originating from Latvia, the Court is concerned with Article 132(1)(f) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax ² (‘the VAT Directive’). This provision is one of the exemptions under European Union VAT law which has not yet been fully clarified. The Court has dealt with it and its numerous definitional conditions only three times in the last few decades. ³ However, there are at present four cases pending before the Court ⁴ relating to different aspects of this exemption.

2The present case would appear to be of fundamental importance above all for its personal scope. In the similar case Aviva, ⁵ on the other hand, the primary issue to be decided is how far the material scope (extension to insurance companies) and the territorial scope (extension to ‘cross-border groups’) of Article 132(1)(f) of the VAT Directive extends and how an absence of distortion of competition is to be determined.

3The background to the exemption is the decision by the EU legislature not to grant an input tax deduction in principle to undertakings which make exempt supplies, such as doctors or schools. Thus, while the outputs of such undertakings are not taxed, at the same time VAT is charged on their inputs. This results in the supply to the final consumer being only partially exempt, as the non-deductible VAT is generally taken into account in pricing and is thus borne by the recipient not directly, but indirectly.

4Because there is no input tax deduction for such undertakings, the purchase of (taxable) elements of the supply which could also be provided by the undertakings themselves may have a negative influence on pricing to the amount of the non-deductible VAT. For example, where a private detective is employed by an insurance company, expenditure is incurred to the amount of the personnel costs, but where recourse is had to the services of an external detective, expenditure is incurred to the amount of those personnel costs and the applicable VAT. There is generally therefore an economic interest in an undertaking making such supplies itself and not purchasing them from another undertaking giving rise to tax liability. Consequently, in the applicable VAT system, through the creation of an exemption without input tax deduction, an undertaking making exempt supplies is treated like a final consumer. A final consumer likewise does not owe any VAT, but also cannot claim any input tax deduction, even if he supplies services for consideration or sells goods.

5However, for undertakings making exempt supplies too, there may be situations in which it makes economic sense, or is even necessary for competition reasons, to provide individual elements of a supply not alone, but together with other undertakings also making exempt supplies. It may thus make sense if, for example, several social security institutions share the costs of a data processing centre. For cases of this kind, Article 132(1)(f) of the VAT Directive also exempts supplies by the group to its members under certain conditions. The exclusion of input tax deduction does not therefore affect pricing, which leaves the scope of the exemption for the final consumer unchanged. The scope does not then depend on whether the supply as a whole was made by an exempt undertaking or by that undertaking together with other exempt undertakings.

II – Legal framework

A – EU law

6In the European Union, VAT is charged pursuant to the VAT Directive. Under Article 2(1)(c) of the VAT Directive, ‘the supply of services for consideration within the territory of a Member State by a taxable person acting as such’ is subject to VAT.

7Under Article 132(1)(f) of the VAT Directive, however, Member States must exempt the following transactions from VAT:

‘the supply of services by independent groups of persons, who are carrying on an activity which is exempt from VAT or in relation to which they are not taxable persons, for the purpose of rendering their members the services directly necessary for the exercise of that activity, where those groups merely claim from their members exact reimbursement of their share of the joint expenses, provided that such exemption is not likely to cause distortion of competition’. ⁶

B – National law

8For the period to which the main proceedings relate, Latvian law did not include any provision transposing Article 132(1)(f) of the VAT Directive.

III – The main proceedings

9The main proceedings concern the VAT owed by the Latvian credit institution DNB Banka AS for 2009 and 2010.

10DNB Banka is part of the DNB group. In those years DNB Banka provided apparently exempt financial services and was supplied various services by other companies in the group, for which, in the assessment of the referring court, DNB Banka evidently owes tax as the customer. It is disputed in this connection whether the services are exempt under Article 132(1)(f) of the VAT Directive. The following are specifically at issue:

financial services provided by the parent company DNB Nord AS, established in Denmark;

IT services provided by the Danish sister company DNB Nord IT AS;

transmission, under cost allocation arrangements, of software licences purchased from a third party by the grandparent company DNB Bank ASA, established in Norway.

11By way of consideration, DNB Banka was invoiced in each case by the Danish companies in the group, DNB Nord and DNB Nord IT, for the costs for the supply of services together with an uplift of 5%. In this regard, DNB Nord IT at least was able to claim input tax for the supply of services in Denmark. The Danish authorities took the view that that supply of services is not exempt.

IV – Procedure before the Court

12On 1 July 2015, the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia), which is now hearing the dispute, referred the following questions to the Court pursuant to Article 267 TFEU:

Is it possible for there to be an independent group of persons for the purposes of Article 132(1)(f) of the Directive, when the members of that group are established in separate Member States of the European Union, in which that provision of the Directive has been transposed with different requirements which are not compatible?

Can a Member State restrict the right of a taxable person to apply the exemption provided for in Article 132(1)(f) of the Directive, when that taxable person has satisfied all the requirements for the application of the exemption in its Member State, but that provision of the Directive has been transposed into the national law of the Member States of other members of the group with restrictions which limit the possibility for taxable persons of other Member States of applying in their own Member State the corresponding exemption from value added tax?

Is it permissible to apply the exemption in Article 132(1)(f) of the Directive to services in the Member State of the recipient of those services, who is a taxable person for value added tax, when the provider of the services, also a taxable person for value added tax, has applied in another Member State value added tax to those services in accordance with general arrangements, that is, considering that value added tax on those services was payable in the Member State of the recipient of those services, in accordance with Article 196 of the Directive?

Must the term “independent group of persons”, for the purposes of Article 132(1)(f) of the Directive, be taken to mean a separate legal person whose existence has to be proved through a specific agreement creating that independent group of persons?

If the reply to that question is that an independent group of persons need not necessarily be taken to mean a separate entity, is an independent group of persons to be regarded as a group of related undertakings in which, in the course of their usual economic activities, those undertakings provide each other with support services for carrying out their commercial activities, and may the existence of that group be proved through the contracts for services concluded or through documentation on transfer prices?

Can a Member State restrict the right of a taxable person to apply the value added tax exemption in Article 132(1)(f) of the Directive, when that taxable person has applied an uplift to the transactions, as required under the legislation on direct taxation of the Member State where the taxable person is established?

Does the exemption in Article 132(1)(f) of the Directive apply to services received from third countries? In other words, where a member of an independent group of persons, as referred to in Article 132(1)(f) of the Directive, provides, within that group, services to other members of the group, can that person be a taxable person from a third country?’

13Written observations on these questions were submitted by DNB Banka, the Hellenic Republic, the Republic of Latvia, the Grand Duchy of Luxembourg, Hungary, the Republic of Poland, the Portuguese Republic, the United Kingdom of Great Britain and Northern Ireland and the European Commission. DNB Banka, the Republic of Latvia, the Federal Republic of Germany, the Grand Duchy of Luxembourg, the Republic of Poland, the United Kingdom and the Commission took part in the hearing on 30 June 2016.

V – Legal assessment

14As the referring court has stated, it was not until 1 January 2014 that a provision was adopted in Latvian law to transpose Article 132(1)(f) of the VAT Directive. The referring court nevertheless takes the view that Article 132(1)(f) of the VAT Directive had direct effect, to the benefit of DNB Banka, before that time. It therefore considers it necessary to have an interpretation of that provision in order to give judgment in the case in the main proceedings.

A – The direct effect of the exemption

15It is first necessary to review the premise posited by the referring court regarding the direct effect of Article 132(1)(f) of the VAT Directive.

16According to settled case-law, a provision of a directive which a Member State has failed to implement in domestic law may be relied on directly by individuals where the provision is, so far as its subject matter is concerned, unconditional and sufficiently precise. ⁷

17It is settled case-law that a provision of EU law is unconditional, so far as its subject matter is concerned, where it sets forth an obligation which is not qualified by any condition, or subject, in its implementation or effects, to the taking of any measure either by the institutions of the European Union or by the Member States. ⁸

18Article 132(1)(f) of the VAT Directive is unconditional, so far as its subject matter is concerned, in that it does not provide Member States with an option whether to make provision for this exemption in national law, but requires them to do so. ⁹

19However, in a recent judgment, the Court held for the first time that a provision of the VAT Directive was not unconditional, so far as its subject matter is concerned, on the ground that, even though no express provision was made to that effect by its wording, it needed to be further specified by national legislation. ¹⁰

20The Federal Republic of Germany has argued, in essence, that in order to implement this condition in national law it is necessary for the national legislature to examine and select the permitted sectors. It is not possible for the competent national authorities to decide in each individual case whether there is distortion of competition precluding the exemption. Against this background, it is not possible for Article 132(1)(f) of the VAT Directive to have direct effect.

21Nevertheless, the abovementioned ruling of the Court concerned a provision (Article 11 of the VAT Directive) which offers Member States an option which, if exercised, requires a number of imprecise legal concepts to be fleshed out. An exemption such as Article 132(1)(f) of the VAT Directive is not comparable with this, however.

22The (negative) definitional element ‘distortion of competition’ is ‘merely’ an imprecise legal concept, in relation to which, in the view of the Court, it must be examined whether the group can be assured of keeping its members’ custom even without the exemption. ¹¹ That examination must be made in each individual case and cannot be pre-determined abstractly for certain sectors. The provision does not therefore allow the national legislature abstract flexibility, with the result that Article 132(1)(f) of the VAT Directive is also unconditional in this regard.

23In order to have direct effect, the provision would also have to be sufficiently precise. According to case-law, this is the case ‘where the obligation which it imposes is set out in unequivocal terms’. ¹² The wording of the directive must thus be sufficiently clear. ¹³

24As was stated above, the (negative) definitional element ‘distortion of competition’ is ‘merely’ an imprecise legal concept, the requirements for which must be assessed. The wording of the directive is also sufficiently clear in this regard.

25Furthermore, the Court has already confirmed direct effect in connection with Article 13(1) of the VAT Directive, which likewise makes taxation of bodies governed by public law dependent on, inter alia, the occurrence of distortion of competition. ¹⁴ Even though this requirement involves an assessment of economic circumstances, this does not preclude its direct effect. ¹⁵

26In addition, the United Kingdom in particular wishes to reject direct effect for Article 132(1)(f) of the VAT Directive because Member States would still have to adopt rules on the legal form of a group and the conditions for membership.

27However, I cannot concur with this view either. It is true that a provision of a directive which allows Member States a broad margin of discretion is not directly applicable. However, the definition of the exemption under Article 132(1)(f) of the VAT Directive does not grant the Member States any discretion as to the legal form of the group and the conditions for membership.

28The rule thus neither contains an explicit power for the Member States to lay down definitions nor does such a power follow from an implicit reference to the respective national civil law. It is settled case-law that, inter alia in the context of the exemptions which are now laid down in Article 132 of the VAT Directive, it is necessary to avoid divergences in the application of the VAT system from one Member State to another. ¹⁶ Just as it is settled case-law that, with regard to Article 14(1) of the VAT Directive, the concept of ownership may not relate to the forms existing in national law, ¹⁷ recourse cannot be had to national law for the definition of a group and the conditions for membership.

29Article 132(1)(f) of the VAT Directive thus satisfies the requirement that the law is clearly defined and is also sufficiently precise to have direct effect. ¹⁸

30As Article 132(1)(f) of the VAT Directive is thus unconditional, so far as its subject matter is concerned, and sufficiently precise, it has direct effect.

B – The questions referred in detail

1. The fourth question: definition of an independent group

31Of the six questions referred in total, the fourth question will be answered first as it is of fundamental importance for the scope of the exemption under Article 132(1)(f) of the VAT Directive in the present case.

32By its fourth question, the referring court is essentially seeking to ascertain whether an independent group of persons for the purposes of Article 132(1)(f) of the VAT Directive must be a separate entity or whether it may — as in the dispute in the main proceedings — consist of a group of related undertakings whose companies provide each other with services.

33It must be stated, first of all, that a group for the purposes of Article 132(1)(f) of the VAT Directive must be a taxable person acting as such within the meaning of Article 9 of the VAT Directive.

34The Court has held, in essence, with regard to Article 132(1)(f) of the VAT Directive that, in the light of the strict interpretation of exemptions under VAT law which is always necessary, ¹⁹ an interpretation of that provision going beyond its clear wording is incompatible with the objective of that provision. ²⁰ It is evident from the wording that the group referred to in the element ‘independent’ supplies the services acting as such and must therefore be distinguished from its members for VAT purposes.

35As the exemption is thus applicable to the supply of services solely by the group itself, but not by its members, the group must be a taxable person within the meaning of Article 9 of the VAT Directive. Otherwise there would not be a taxable supply of services by the group for the purposes of Article 2(1)(c) of the VAT Directive which could be exempted. Only the supply of services by ‘a taxable person acting as such’ is taxable.

36It would be different only if Article 132(1)(f) of the VAT Directive were intended to safeguard the scope of the exemption or non-taxation of the activities of members of the group, where mere cooperation by such taxable persons (or even non-taxable persons) is not intended to result in any further VAT being due. This would then explain why the group must make supplies for the purpose of rendering their members the services directly necessary for the non-taxable activities of the members and may merely claim exact reimbursement of their share of the expenses for that supply of services.

37However, the wording of Article 132(1)(f) of the VAT Directive, which is to be interpreted strictly, simply refers to the supply of services by a group which are to be exempted and which — as I stated in the Opinion in Commission v Luxembourg ²¹ — are taxable only if they are also provided by a taxable person within the meaning of Article 9 of the VAT Directive.

38Nevertheless, an independent group does not have to be a legal person. The Court has repeatedly indicated that separate legal personality is not a requirement for accepting the existence of a taxable person within the meaning of Article 9 of the VAT Directive. ²² The only relevant factor is whether a person or group of persons or assets ‘independently’ carries out any economic activity within the meaning of Article 9(1) of the VAT Directive.

39The Court has thus far dealt with a number of situations, in its case-law regarding the criterion of independence under Article 9(1) of the VAT Directive, where the point at issue was always whether a person or a group of assets was in a relationship of employer and employee with another taxable person and thus, by direct or analogous application of Article 10 of the VAT Directive, did not conduct an activity independently. The subject matter was the independence of a person vis-à-vis his customers, ²³ of shareholders vis-à-vis their company ²⁴ and of entities of an organisation vis-à-vis the organisation itself. ²⁵

40This latter case-law regarding organisational entities can be applied to the present case, as a group for the purposes of Article 132(1)(f) of the VAT Directive is intended to offer its members a common structure for cooperation ²⁶ which is therefore organisationally autonomous. With regard to organisational entities, the Court has rejected independence in particular where they cannot own their own property. ²⁷ However, a group — that is to say, a group of several independent companies, based solely on shareholdings existing among them — cannot own its own property as such. Accordingly, in principle a group acting as such neither constitutes a taxable person within the meaning of Article 9(1) nor can it therefore be an independent group for the purposes of Article 132(1)(f) of the VAT Directive.

41This interpretation is confirmed by the existence of the special rule laid down in Article 11 of the VAT Directive. Under that provision, Member States may ‘regard as a single taxable person any persons … who, while legally independent, are closely bound to one another by financial, economic and organisational links’. On the basis of that provision alone, related undertakings are to be construed as a taxable person and supplies within the group are therefore to be exempted from VAT.

42It is true that under certain circumstances a separate company with several shareholders within a group can be regarded as an independent group. However, the exemption would then apply only to a company’s supplies to its shareholders, because Article 132(1)(f) of the VAT Directive exempts only the supply of services by the group to its members, but not vice versa. Nevertheless, such supplies are not at issue in the main proceedings and there is therefore no need for further examination in this regard.

43Accordingly, the exemption under Article 132(1)(f) of the VAT Directive is not applicable a priori to a case like the dispute in the main proceedings because there is no supply by an independent group to its members under the conditions laid down.

44In answer to the fourth question, it must therefore be stated that an independent group of persons for the purposes of Article 132(1)(f) does not have to be a legal person, but a taxable person within the meaning of Article 9(1) of the VAT Directive. A group consisting of related companies does not as such satisfy this requirement.

2. The first, second, third and sixth questions: application to a ‘cross-border’ group

45By the first, second, third and sixth questions, the referring court is seeking to ascertain whether and under what conditions the exemption under Article 132(1)(f) of the VAT Directive may also be applicable to a cross-border group.

46As the Federal Republic of Germany has submitted, this presupposes, as a preliminary issue, that the exemption under Article 132(1)(f) of the VAT Directive is actually applicable to undertakings which supply exempt financial services for the purposes of Article 135 of the VAT Directive. As I have explained in my Opinion in Aviva, ²⁸ that is not the case. Having regard to its place in the scheme of the directive and its drafting history, Article 132(1)(f) of the VAT Directive covers only groups of taxable persons which carry out exempt transactions in accordance with Article 132 of the VAT Directive. This does not include financial services.

47In any event, it is also not possible to infer from the VAT Directive a cross-border application of the exemption under Article 132(1)(f) of the VAT Directive. As I have explained in my Opinion in Aviva, ²⁹ this is clear from the Sixth Directive. Furthermore, it is also evident from the difficulties experienced by a number of Member States in assessing the definitional elements of Article 132(1)(f) of the VAT Directive. A Member State’s tax revenue would depend on (changing) situations and non-verifiable assessments in other Member States (or even third countries). This would create significant practical problems which would run counter to the principle laid down in EU law that Member States have the power to raise tax revenue in their territory ³⁰ and could thus also justify a possible infringement of fundamental freedoms by the VAT Directive.

3. The fifth question: cost uplift of 5%

48By the fifth question, the referring court is essentially seeking to ascertain whether the exemption under Article 132(1)(f) of the VAT Directive also applies where the taxable person has calculated the price of his services, as required under the legislation on direct taxation of the Member State where the taxable person is established, based on the expenses incurred plus an uplift, which in this case amounts to 5%.

49Under Article 132(1)(f) of the VAT Directive, the supply of services by a group is exempted only on the condition that the group ‘merely claim[s] from [its] members exact reimbursement of their share of the joint expenses’.

50If it is established in the present case that more than the expenses within the meaning of that provision were owed, as the referring court has stated, this definitional condition for the exemption is not therefore met.

51It might be different only if the concept of expenses in Article 132(1)(f) of the VAT Directive also includes the expenses element of the owner’s income, which is possibly reflected in an uplift in the actual expenditure for providing the service. However, there are serious doubts in this regard. First, that interpretation is contrary to the wording of the provision in nearly all the languages. In normal usage, ‘reimbursement’, ³¹ or even repayment ³² or refund, ³³ covers outlay and not income. Consideration of owner’s income is also not compatible with the purpose of the exemption under Article 132(1)(f) of the VAT Directive, which I have explained in my Opinion in Aviva. ³⁴ This consists in extending another exemption to a preliminary stage, because the taxable persons cooperate with one another for competition reasons. The idea of owner’s income as an element of the group’s expenses is not compatible with the elimination of a competitive disadvantage.

52The answer to the fifth question is therefore that the exemption under Article 132(1)(f) of the VAT Directive is not applicable where a consideration is paid for the supply of services which goes beyond the expenses incurred. That is also the case where, as required under the legislation on direct taxation, a simple flat-rate cost uplift is paid.

VI – Conclusion

Conclusion

53Accordingly, I propose that the Court answer the request for a preliminary ruling from the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia) as a whole as follows:

An independent group of persons for the purposes of Article 132(1)(f) does not have to be a legal person, but a taxable person within the meaning of Article 9(1) of the VAT Directive. A group of related companies does not as such satisfy this requirement.

Article 132(1)(f) covers, for the present purposes, only groups of taxable persons which carry out exempt transactions in accordance with Article 132(1) of the VAT Directive. Groups of financial services undertakings do not therefore fall within the scope of Article 132(1)(f) of the VAT Directive.

The independent group of persons may supply exempt services only to members that are subject to the same legal order, namely its own.

The exemption under Article 132(1)(f) of the VAT Directive is not applicable where a consideration is paid for the supply of services which goes beyond the expenses incurred. That is also the case where, as required under the legislation on direct taxation, a simple flat-rate cost uplift is paid.

¹ Original language: German.

² OJ 2006 L 347, p. 1.

³ Judgments of 15 June 1989, Stichting Uitvoering Financiële Acties (348/87, EU:C:1989:246); of 20 November 2003, Taksatorringen (C‑8/01, EU:C:2003:621); and of 11 December 2008, Stichting Centraal Begeleidingsorgaan voor de Intercollegiale Toetsing (C‑407/07, EU:C:2008:713).

⁴ Along with the present case, these are Cases C‑274/15 (Commission v Luxembourg), C‑605/15 (Aviva) and C‑616/15 (Commission v Germany).

⁵ Court case number: C‑605/15.

⁶ Article 132(1)(f) of the VAT Directive corresponds to the provision contained in Article 13(A)(1)(f) of the now replaced 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 (OJ 1977 L 145, p. 1; ‘the Sixth Directive’). Regard must also be had to the Court’s case-law on that provision in the present case.

⁷ See inter alia judgments of 19 January 1982, Becker (8/81, EU:C:1982:7, paragraph 25); of 22 June 1989, Costanzo (103/88, EU:C:1989:256, paragraph 29); of 10 September 2002, Kügler (C‑141/00, EU:C:2002:473, paragraph 51); and of 7 July 2016, Ambisig (C‑46/15, EU:C:2016:530, paragraph 16); see judgment of 4 December 1974, Van Duyn (41/74, EU:C:1974:133, paragraph 12).

⁸ See inter alia judgments of 23 February 1994, Comitato di coordinamento per la difesa della cava and Others (C‑236/92, EU:C:1994:60, paragraph 9); of 26 October 2006, Pohl-Boskamp (C‑317/05, EU:C:2006:684, paragraph 41); of 1 July 2010, Gassmayr (C‑194/08, EU:C:2010:386, paragraph 45); of 15 May 2014, Almos Agrárkülkereskedelmi (C‑337/13, EU:C:2014:328, paragraph 32); and of 7 July 2016, Ambisig (C‑46/15, EU:C:2016:530, paragraph 17).

⁹ See to that effect, with regard to another exemption, judgment of 28 November 2013, MDDP (C‑319/12, EU:C:2013:778, paragraph 49).

¹⁰ Judgment of 16 July 2015, Larentia Minerva and Marenave Schiffahrt (C‑108/14 and C‑109/14, EU:C:2015:496, paragraph 50).

¹¹ See judgment of 20 November 2003, Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 59).

¹² Judgments of 23 February 1994, Comitato di coordinamento per la difesa della cava and Others (C‑236/92, EU:C:1994:60, paragraph 10); of 17 September 1996, Cooperativa Agricola Zootecnica S. Antonioand Others (C‑246/94 to C‑249/94, EU:C:1996:329, paragraph 19); of 29 May 1997, Klattner (C‑389/95, EU:C:1997:258, paragraph 33); and of 1 July 2010, Gassmayr (C‑194/08, EU:C:2010:386, paragraph 45).

¹³ See inter alia judgments of 25 January 1983, Smit Transport (126/82, EU:C:1983:14, paragraph 11); of 4 December 1997, Kampelmann and Others (C‑253/96 to C‑258/96, EU:C:1997:585, paragraph 38); of 9 September 2004, Meiland Azewijn (C‑292/02, EU:C:2004:499, paragraph 61); of 19 December 2012, Orfey (C‑549/11, EU:C:2012:832, paragraph 53); and of 6 October 2015, T-Mobile Czech Republic and Vodafone Czech Republic (C‑508/14, EU:C:2015:657, paragraph 53).

¹⁴ See the second subparagraph of the provision, which corresponds to the second subparagraph of Article 4(5) of the Sixth Directive.

¹⁵ See judgments of 17 October 1989, Comune di Carpaneto Piacentino and Others (231/87 and 129/88, EU:C:1989:381, paragraphs 32 and 33) and of 8 June 2006, Feuerbestattungsverein Halle (C‑430/04, EU:C:2006:374, paragraph 31) with regard to the second subparagraph of Article 4(5) of the Sixth Directive.

¹⁶ See inter alia judgments of 25 February 1999, CPP (C‑349/96, EU:C:1999:93, paragraph 15); of 14 June 2007, Horizon College (C‑434/05, EU:C:2007:343, paragraph 15); of 21 February 2013, Žamberk (C‑18/12, EU:C:2013:95, paragraph 17); and of 2 July 2015, De Fruytier (C‑334/14, EU:C:2015:437, paragraph 17).

¹⁷ See inter alia judgments of 8 February 1990, Shipping and Forwarding Enterprise Safe (C‑320/88, EU:C:1990:61, paragraph 7); of 15 December 2005, CentralanProperty (C‑63/04, EU:C:2005:773, paragraph 62); and of 3 September 2015, Fast Bunkering Klaipėda (C‑526/13, EU:C:2015:536, paragraph 51).

¹⁸ See judgment of 20 November 2003, Taksatorringen (C‑8/01, EU:C:2003:621, paragraphs 58 to 65).

¹⁹ With regard to this principle, which has subsequently been reiterated in settled case-law, see the judgments of 26 June 1990, Velker International Oil Company (C‑185/89, EU:C:1990:262, paragraph 19); of 16 September 2004, Cimber Air (C‑382/02, EU:C:2004:534, paragraph 25); and of 2 July 2015, De Fruytier (C‑334/14, EU:C:2015:437, paragraph 18).

²⁰ Judgment of 15 June 1989, Stichting Uitvoering Financiële Acties (348/87, EU:C:1989:246, paragraphs 13 and 14), with regard to Article 13(A)(1)(f) of the Sixth Directive.

²¹ See my Opinion in Commission v Luxembourg (C‑274/15, EU:C:2016:750, point 49 et seq.).

²² See judgments of 27 January 2000, Heerma (C‑23/98, EU:C:2000:46, paragraph 8), and of 29 September 2015, Gmina Wrocław (C‑276/14, EU:C:2015:635, paragraph 28); see also, to that effect, judgment of 16 July 2015, Larentia Minerva and Marenave Schiffahrt (C‑108/14 and C‑109/14, EU:C:2015:496, paragraph 37), which, it would appear, can be applied in this regard to Article 9 of the VAT Directive.

²³ Judgments of 26 March 1987, Commission v Netherlands (235/85, EU:C:1987:161); of 25 July 1991, Ayuntamiento de Sevilla (C‑202/90, EU:C:1991:332); and of 12 November 2009, Commission v Spain (C‑154/08, EU:C:2009:695).

²⁴ Judgments of 27 January 2000, Heerma (C‑23/98, EU:C:2000:46), and of 18 October 2007, van der Steen (C‑355/06, EU:C:2007:615).

²⁵ Judgments of 23 March 2006, FCE Bank (C‑210/04, EU:C:2006:196), and of 17 September 2014, Skandia America (USA) (C‑7/13, EU:C:2014:2225), both concerning a branch of a company, and of 29 September 2015, Gmina Wrocław (C‑276/14, EU:C:2015:635), concerning a municipal entity.

²⁶ Judgment of 11 December 2008, Stichting Centraal Begeleidingsorgaan voor de Intercollegiale Toetsing (C‑407/07, EU:C:2008:713, paragraph 37).

²⁷ See, to that effect, Opinion of Advocate General Jääskinen in Gmina Wrocław (C‑276/14, EU:C:2015:431, point 46) and judgment of 29 September 2015, Gmina Wrocław (C‑276/14, EU:C:2015:635, paragraph 38); see also judgments of 23 March 2006, FCE Bank (C‑210/04, EU:C:2006:196, paragraph 37), and of 17 September 2014, Skandia America (USA) (C‑7/13, EU:C:2014:2225, paragraph 26), which refer to the company having capital of its own.

²⁸ See my Opinion of today’s date in Case C‑605/15, point 19 et seq.

²⁹ See my Opinion of today’s date in Case C‑605/15, point 36 et seq.

³⁰ With regard to the principle of territoriality in general, see judgments of 29 November 2011, National Grid Indus (C‑371/10, EU:C:2011:785, paragraph 46); of 17 September 2009, Glaxo Wellcome (C‑182/08, EU:C:2009:559, paragraph 82 et seq.); and of 5 July 2012, SIAT (C‑318/10, EU:C:2012:415, paragraph 45 et seq.); with regard to the principle of territoriality in VAT law, see also judgment of 12 September 2013, Le Crédit Lyonnais (C‑388/11, EU:C:2013:541, paragraph 42).

³¹ English: ‘exact reimbursement’, [German: ‘genaue Erstattung’,] French: ‘remboursement exact’, Swedish: ‘ersättning’, Spanish: ‘reembolso exacto’; Latvian: ‘precīzi atmaksāt’, Polish: ‘zwrotu przypadającej’.

³² Dutch: ‘terugbetaling’.

³³ Italian: ‘rimborso’, Bulgarian: ‘възстановяване (…) разходи’, see the apparently broader Danish version: ‘godtgørelse’, which refers to ‘compensation’.

³⁴ See my Opinion of today’s date in Case C‑605/15, points 20 and 21.