C-40/15 Aspiro

JUDGMENT OF THE COURT (First Chamber)

17 March 2016 ( *1 )

‛Reference for a preliminary ruling — Taxation — Value added tax — Directive 2006/112/EC — Article 135(1)(a) — Exemption for insurance — Definition of ‘insurance’ transactions and of ‘related services performed by insurance brokers and insurance agents’ — Claims settlement services provided by and on behalf of an insurer’

In Case C‑40/15,

REQUEST for a preliminary ruling under Article 267 TFEU from the Naczelny Sąd Administracyjny (Supreme Administrative Court, Poland), made by decision of 19 November 2014, received at the Court on 2 February 2015, in the proceedings

Minister Finansów

v

Aspiro SA, formerly BRE Ubezpieczenia sp. z o.o.,

THE COURT (First Chamber),

composed of R. Silva de Lapuerta, President of the Chamber, A. Arabadjiev, J.-C. Bonichot, C.G. Fernlund (Rapporteur) and S. Rodin, Judges,

Advocate General: J. Kokott,

Registrar: K. Malacek, Administrator,

having regard to the written procedure and further to the hearing on 2 December 2015,

after considering the observations submitted on behalf of:

Minister Finansów, by B. Rogowska-Rajda, J. Kaute and M. Lubiński, acting as Agents,

Aspiro SA, by M. Szafarowska, T. Michalik and M. Spychalski, tax advisers,

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

the United Kingdom Government, by L. Christie and S. Brandon, acting as Agents, and by E. Mitrophanous, Barrister,

the European Commission, by L. Lozano Palacios and M. Owsiany-Hornung, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 23 December 2015,

gives the following

Judgment

Legal context and the dispute

1This request for a preliminary ruling relates to the interpretation of Article 135(1)(a) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1, ‘the VAT Directive’).

2The request has been made in proceedings between the Minister Finansów (Minister for Finance) and Aspiro SA, formerly BRE Ubezpieczenia sp. z o.o. (‘Aspiro’) concerning a tax ruling on the exemption from value added tax (VAT) of services for the settlement of claims provided by Aspiro for and on behalf of an insurance company.

Legal context

EU law

3Article 135(1)(a) of the VAT Directive provides:

‘Member States shall exempt the following transactions:

insurance and reinsurance transactions, including related services performed by insurance brokers and insurance agents.’

4Article 135(1)(a) corresponds to Article 13B(a) of the 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), which it replaced.

5Article 135(1)(d) and (f) of the VAT Directive provides for the exemption of two other types of transaction:

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

…

transactions, including negotiation but not management or safekeeping, in shares, interests in companies or associations, debentures and other securities, but excluding documents establishing title to goods, and the rights or securities referred to in Article 15(2).’

Polish law

6The Law on the tax on goods and services (ustawa o podatku od towarów i usług) of 11 March 2004, in the version applicable at the time of the facts in the main proceedings (Dz. U. of 2011, No 177, position 1054, ‘the Law on VAT’) provides in Article 43(1), point 37:

‘Insurance services, reinsurance services and brokerage services for the supply of insurance and reinsurance services, and also services supplied by an insurer pursuant to insurance contracts which it has concluded for the account of another party, other than the disposal of rights acquired in the performance of insurance and reinsurance contracts, shall be exempt from tax.’

7Under Article 43(13) of that law:

‘The tax exemption shall also apply to the supply of a service which constitutes an element of a service referred to in paragraph 1(7) and (37) to (41), which itself forms a distinct whole and is characteristic of and necessary for the supply of a service exempt under paragraph 1(7) and (37) to (41).’

The dispute in the main proceedings and the question referred

8Aspiro, a company established in Warsaw, is liable to VAT. Aspiro supplies, in the name and on behalf of an insurance company, on the basis of a contact concluded with that company, comprehensive services for the settlement of insurance claims. Aspiro is remunerated in accordance with a flat rate, depending on the type of claim concerned.

9The referring court makes it clear that Aspiro is neither an insurance company, nor an insurance broker, nor an insurance agent. In particular, Aspiro does not have a liability towards the insured persons. Under the contract, Aspiro performs the following 18 tasks, but delegates some of them to an external subcontractor:

receiving insurance claims;

registering claims in an IT system, including updating data throughout the claims procedure;

establishing the reasons for and circumstances of the claims, including inspecting the insured asset and place where damage occurred, preparing the required documentation and taking the necessary steps to establish liability, the amount of damage suffered and amount of compensation, and all other services due to the insured person;

conducting correspondence, as necessary, with the client, including fulfilling notification obligations in relation to injured or insured persons and exchanging correspondence with other entities involved in the process of settling the claims;

settling substantive claims, analysing the assembled documents and taking substantive decisions on claims;

making technical assessments and any additional damage assessments in the case of motor insurance claims;

producing photographic documentation showing the extent of damage;

producing copies of the documents required when making a claim;

drawing up the comprehensive documentation necessary for the purposes of processing a claim for compensation or other services;

archiving claim documents;

providing insured persons with detailed information on the claims settlement procedure and their rights;

conducting proceedings, other than court proceedings, for recovery against third parties;

considering appeals and complaints in respect of claim settlements;

making claim files available to the insured person concerned for inspection;

drawing up transfers and remittances in the computer system;

sending and receiving correspondence relating to claims settlement;

preparing, at the client’s request, a report on the handling of the claim;

any other activity required in order to settle claims arising under insurance contracts, related to the activities referred to above.

10Aspiro lodged a request with the Finance Minister for an individual written interpretation of the Law on VAT to establish whether the claims settlement services that it provided were exempt.

11According to Aspiro, the services that it performs, in the name and on behalf of an insurance company, on the basis of a mandate, constitute insurance services, within the meaning of Polish law. They form a distinct whole, entirely related to the business of that insurance company and indispensable to it, which does not pursue a purpose in itself. Aspiro submits that those services constitute a single supply of services, of complex nature, which must be exempted as a whole.

12In his written interpretation of 31 August 2012, the Finance Minister only partially confirmed Aspiro’s position. The Finance Minister considered that only the fifth category of services, namely settling substantive claims, including the analysis of the relevant documents and the decision as to whether the claim was covered, was an insurance activity. He found that all the other services performed by Aspiro were linked to the settlement of claims, but did not constitute insurance services. According to the Minister, they did not benefit, therefore, from the exemption, because they were of a technical and administrative nature and could be performed in the context of activities other than insurance services.

13Aspiro brought an action against that interpretation before the Wojewódzki Sąd Administracyjny (Regional Administrative Court, Warsaw; ‘WSA’). That court upheld the action and annulled the interpretation, finding that the Polish legislature had intended the exemption to extend beyond what was provided for by the VAT Directive, and held that the Finance Minister could not rely on the stricter terms of that directive against the taxable person.

14The Finance Minister lodged an appeal in cassation against that judgment.

15Entertaining doubts as to whether a provision such as Article 43(13) of the Law on VAT wrongly extended the provisions of Article 135(1)(a) of the VAT Directive, and whether services such as those provided by Aspiro could be exempted, the Naczelny Sąd Administracyjny (Supreme Administrative Court) decided to stay the proceedings and refer the following question to the Court of Justice for a preliminary ruling:

‘Must Article 135(1)(a) of the VAT Directive be interpreted as meaning that services such as those in the present case, which are supplied on behalf of an insurance undertaking by a third party — in the name and on behalf of the insurer — which has no legal relationship with the insured person, are covered by the exemption referred to in that provision?’

The question referred for a preliminary ruling

Admissibility

16Aspiro submits that the dispute in the main proceedings raises an issue of interpretation of national law only and consequently does not concern EU law. According to that company, the question referred is thus entirely irrelevant for the purposes of determining that dispute and, hence, is inadmissible. Aspiro emphasises that even in the event that Article 43(13) of the Law on VAT added an exemption that was not provided for in Article 135(1)(a) of the VAT Directive, the national authorities could not impose on a private person the stricter provisions of that directive.

17In that regard, it must be borne in mind that, in the context of the cooperation between the Court and the national courts provided for in Article 267 TFEU, it is solely for the national court before which a dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court. Consequently, where the question put by national court concerns the interpretation of a provision of EU law, the Court is, in principle, bound to give a ruling. The Court may refuse to rule on a question referred for a preliminary ruling by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (see judgments in PreussenElektra, C‑379/98, EU:C:2001:160, paragraphs 38 and 39, and Melki and Abdeli, C‑188/10 and C‑189/10, EU:C:2010:363, paragraph 27).

18In the present case, it should be recalled that the referring court is bound, as far as possible, to interpret national law in the light of EU law (see, inter alia, judgment in Pfeiffer and Others, C‑397/01 to C‑403/01, EU:C:2004:584, paragraph 113) and, in this case, the VAT Directive. Since the referring court queries the scope of a national provision the benefit of which is relied on in the main proceedings and which transposes the VAT Directive, it is not obvious that that question referred to the Court as to the interpretation to be given to that directive is irrelevant for the determination of that dispute.

19It follows that the reference for a preliminary ruling is admissible.

Substance

20At the outset, it must be recalled that the terms used to specify the exemptions covered by Article 135(1) of the VAT 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 judgment in BGŻ Leasing, C‑224/11, EU:C:2013:15, paragraph 56).

21In order to answer the question referred, the Court must consider whether the settlement of claims, such as that performed by Aspiro, consists of making ‘insurance transactions’ or is to be regarded as ‘related services performed by insurance brokers and insurance agents’, within the meaning of Article 135(1)(a) of the VAT Directive.

22As regards, in the first place, insurance transactions, the essentials of such transactions are, as generally understood, that the insurer undertakes, in return for prior payment of a premium, to provide the insured, in the event of materialisation of the risk covered, with the service agreed when the contract was concluded (judgments in CPP, C‑349/96, EU:C:1999:93, paragraph 17, and Taksatorringen, C‑8/01, EU:C:2003:621, paragraph 39).

23The Court has stated that the expression ‘insurance transactions’ covers not only transactions carried out by the insurers themselves and, is, in principle sufficiently broad to include the provision of insurance cover by a taxable person who is not himself an insurer but, in the context of a block policy, procures such cover for his customers by making use of the supplies of an insurer who assumes the risk insured. However, such transactions necessarily imply the existence of a contractual relationship between the provider of the insurance service and the person whose risks are covered by the insurance, that is to say, the insured party (see judgment in Taksatorringen, C‑8/01, EU:C:2003:621 paragraphs 40 and 41).

24However, in the present case, a provider of services such as Aspiro does not itself undertake to ensure that the insured person is covered in respect of a risk and is not connected in any way to the insured person through a contractual relationship.

25Consequently, even though the claims settlement service at issue in the main proceedings, such as it is described by the referring court, is an essential part of an insurance transaction in that it includes, in the present case, the determination of liability and the amount of damage, and the decision to pay or refuse compensation to the insured person, it must be held that the service — provided moreover to the insurer — does not constitute an insurance transaction, within the meaning of Article 135(1)(a) of the VAT Directive.

26Furthermore, that finding is supported by the need, as recalled in paragraph 20 of this judgment, to interpret exemptions to the general system of VAT system strictly.

27That finding is not undermined by the argument, made by Aspiro and the Polish Government, that it is appropriate to align the treatment of insurance transactions for the purpose of VAT with the treatment applicable to financial services. According to that company and government, since claims settlement services are a key element of the business of providing insurance, while constituting a distinct whole, they should, as with the solution adopted for financial services, benefit from the exemption laid down in Article 135(1)(a) of the VAT Directive. That analysis is, they argue, supported by the proposal for a Council directive amending Directive 2006/112 as regards the treatment of insurance and financial services (COM(2007) 747 final) presented by the Commission on 28 November 2007.

28In that regard, it is true that the Court has held, in a judgment concerning financial institutions, that if the services provided, viewed broadly, in that case certain IT services, form a distinct whole and fulfil the specific, essential functions of the financial services described in points (d) and (f) of Article 135(1) of the VAT Directive, they benefit from the exemption laid down in that provision (see, to that effect, judgment in SDC, C‑2/95, EU:C:1997:278, paragraph 66).

29However, the Court has held that the analogy with financial services cannot be applied in relation to insurance transactions, emphasising the difference in wording between Article 135(1)(a) of the VAT Directive, which only refers to insurance transactions in the strict sense, and Article 135(1)(d) and (f) of that directive, which refers to transactions ‘concerning’ or ‘relating to’ certain banking operations (see, to that effect, judgment in Taksatorringen, C‑8/01, EU:C:2003:621, paragraph 43).

30Furthermore, since the proposal for a directive referred to in paragraph 27 above has not been adopted by the Council, it is in any event entirely irrelevant for the interpretation of the law in force and cannot therefore support an interpretation of Article 135(1)(a) of the VAT Directive based on an analogy with Article 135(1)(d) and (f) of that directive.

31It must be noted, moreover, that the finding made in paragraph 25 above is not called into question by the principle of fiscal neutrality. As the Advocate General stated at point 28 of her Opinion, that principle cannot extend the scope of an exemption in the absence of clear wording to that effect. That principle is not a rule of primary law which can determine the validity of an exemption, but a principle of interpretation, to be applied concurrently with the principle of strict interpretation of exemptions (see, to that effect, judgment in Deutsche Bank, C‑44/11, EU:C:2012:484, paragraph 45).

32It is necessary to consider, in the second place, whether the supplies of services at issue in the main proceedings are ‘services related’ to ‘insurance and reinsurance transactions, […] performed by insurance brokers and insurance agents’ and can, on that basis, be exempted.

33As regards, first, the definition of ‘services related’ to ‘insurance and reinsurance transactions’, as the Advocate General observed in point 31 of her Opinion, the term ‘related’ is sufficiently broad to cover different services connected with the performance of insurance transactions and, in particular, the settlement of claims, which constitute one of the essential parts of those transactions.

34As regards, second, the condition that the services concerned must be ‘performed by insurance brokers and insurance agents’, it is necessary to determine whether the activities of a service provider such as Aspiro, which comprise the settlement of claims in the name and on behalf of an insurance company, may be considered to be performed by such brokers or agents.

35In that regard, the fact that, according to the description of the facts set out by the referring court, Aspiro is neither an insurance broker nor an insurance agent is not decisive. The formal aspects of that company cannot suffice to determine whether its business activities fall within the scope of the exemption or not.

36As the Court has already held, it is necessary to examine the content of the activities in question, (see, to that effect, judgments in Arthur Andersen, C‑472/03, EU:C:2005:135, paragraph 32; Abbey National, C‑169/04, EU:C:2006:289, paragraph 66, and J.C.M. Beheer, C‑124/07, EU:C:2008:196, paragraph 17).

37For the purpose of this examination, two conditions are required to be met. In the first place, the service provider must have a relationship with both the insurer and the insured party (judgment in Taksatorringen, C‑8/01, EU:C:2003:621, paragraph 44). That relationship can be only indirect if the provider is a subcontractor of the broker or agent (see, to that effect, judgment in J.C.M. Beheer, C‑124/07, EU:C:2008:196, paragraph 29). In the second place, its activities must cover the essential aspects of the work of an insurance agent, such as the finding of prospective clients and their introduction to the insurer (see, to that effect, judgment in Arthur Andersen, C‑472/03, EU:C:2005:135, paragraphs 33 and 36).

38The first of those conditions is met by a service provider such as Aspiro. That service provider is in a direct relationship with the insurance company, since it performs its activities in the name and on behalf of the insurance company, and it has an indirect relationship with the insured party, in the context of the examination and management of claims.

39On the other hand, as regards the second of those conditions, relating to the services provided by insurance brokers and agents, or their subcontractors, those services must be linked to the essential aspects of the work of an insurance broker or agent, which consists in the finding of prospective clients and their introduction to the insurer with a view to the conclusion of insurance contracts (see, in particular, judgments in Taksatorringen, C‑8/01, EU:C:2003:621, paragraph 45; Arthur Andersen, C‑472/03, EU:C:2005:135, paragraph 36, and J.C.M. Beheer, C‑124/07, EU:C:2008:196, paragraph 18). As regards a subcontractor, it is necessary for it to be involved in the conclusion of insurance contracts (see, to that effect, judgment in J.C.M. Beheer, C‑124/07, EU:C:2008:196, paragraphs 9 and 18).

40The settling of claims by and on behalf of an insurer, such as that at issue in the main proceedings, is not linked in any way to the finding of prospective clients and their introduction to the insurer with a view to the conclusion of insurance contracts.

41It follows that such an activity is not within ‘related services performed by insurance brokers and insurance agents’, within the meaning of Article 135(1)(a) of the VAT Directive.

42In common with the services at issue in the case leading to the judgment in Arthur Andersen (C‑472/03, EU:C:2005:135), the services claims settlement services provided by a company such as Aspiro must be regarded as not constituting the performance of services carried out by an insurance agent but as a division of the activities performed by insurance companies (see, to that effect, judgment in Arthur Andersen, C‑472/03, EU:C:2005:135, paragraph 38).

43Accordingly, it is not necessary to refer, as the United Kingdom Government has done, to the notion of ‘insurance mediation’, found in Article 2(3) of Directive 2002/92/EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation (OJ 2003 L 9, p. 3), nor to the definitions of the business activities of insurance brokers or agents, which are referred to in Article 2(1) of Council Directive 77/92/EEC of 13 December 1976 on measures to facilitate the effective exercise of freedom of establishment and freedom to provide services in respect of the activities of insurance agents and brokers (ex ISIC Group 630) and, in particular, transitional measures in respect of those activities (OJ 1977 L 26, p. 14), which Directive 2002/92 replaced. As the Advocate General observed in paragraph 46 of her Opinion, those directives seek to promote the freedom to provide the services concerned in the European Union and pursue a different objective from that of the VAT Directive. The definitions in question cannot therefore be used as they stand for the purposes of determining, in the context of the VAT Directive, the range of transactions exempt from VAT.

44It follows that the act of merely entrusting the handling of claims to a third party, without that outsourcing being linked to the finding of prospective clients and their introduction to the insurer with a view to the conclusion of insurance contracts, is not exempt from VAT.

45It follows from all the forgoing considerations that the answer to the question referred is that Article 135(1)(a) of the VAT Directive must be interpreted as meaning that claims settlement services, such as those at issue in the main proceedings, provided by a third party in the name and on behalf of an insurance company, do not fall within the exemption laid down by that provision.

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 (First Chamber) hereby rules:

Article 135(1)(a) Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as meaning that claims settlement services, such as those at issue in the main proceedings, provided by a third party in the name and on behalf of an insurance company, do not fall within the exemption laid down by that provision.

Signatures

[Signatures]

( *1 ) Language of the case: Polish.

OPINION OF ADVOCATE GENERAL

KOKOTT

delivered on 23 December 2015 ¹

‛Taxation — Value added tax — Article 135(1)(a) of Directive 2006/112/EC — Exemption for insurance transactions and related services of insurance brokers and insurance agents — Outsourcing of settlement of claims by the insurer’

1Are services in connection with the settlement of insurance claims exempt from VAT if an insurer does not perform this task itself, but outsources it to a third party? The Court’s case-law on exemption from VAT for insurance services ² does not yet give a clear answer to this question.

I – Legislative framework

A – EU law

2Under Article 2(1)(c) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax ³ (‘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.

3Under Article 135(1)(a) of the VAT directive, Member States must, however, exempt the following transactions:

insurance and reinsurance transactions, including related services performed by insurance brokers and insurance agents.’

4That provision corresponds to Article 13(B)(a) of the Sixth Directive, which applied up to 31 December 2006. ⁴ The Court’s case-law on the latter provision can therefore also be taken into consideration in the present case.

5Directive 77/92/EEC ⁵ regulated the pursuit of the activity of insurance agents and insurance brokers within the Union until 14 January 2005. Article 2(1) defines the scope, in part, as follows:

‘This Directive shall apply to the following activities ...:

professional activities of persons who, acting with complete freedom as to their choice of undertaking, bring together, with a view to the insurance or reinsurance of risks, persons seeking insurance or reinsurance and insurance or reinsurance undertakings, carry out work preparatory to the conclusion of contracts of insurance or reinsurance and, where appropriate, assist in the administration and performance of such contracts, in particular in the event of a claim;

professional activities of persons instructed under one or more contracts or empowered to act in the name and on behalf of, or solely on behalf of, one or more [sic!] insurance undertakings in introducing, proposing and carrying out work preparatory to the conclusion of, or in concluding, contracts of insurance, or in assisting in the administration and performance of such contracts, in particular in the event of a claim;

...’

6Directive 2002/92/EC ⁶ has now replaced Directive 77/92. Article 2(3) defines ‘insurance mediation’ as follows:

‘... the activities of introducing, proposing or carrying out other work preparatory to the conclusion of contracts of insurance, or of concluding such contracts, or of assisting in the administration and performance of such contracts, in particular in the event of a claim.

...

The provision of information on an incidental basis in the context of another professional activity provided that the purpose of that activity is not to assist the customer in concluding or performing an insurance contract, the management of claims of an insurance undertaking on a professional basis, and loss adjusting and expert appraisal of claims shall also not be considered as insurance mediation.’

B – Polish law

7Article 43(1)(37) of the Ustawa o podatku od towarów i usług of 11 March 2004 (‘the Polish Law on turnover tax), in the version relevant to this case, reads as follows:

‘Insurance services, reinsurance services and brokerage services for the supply of insurance and reinsurance services, and also services supplied by an insurer pursuant to insurance contracts which it has concluded for the account of another party, other than the disposal of rights acquired in the performance of insurance and reinsurance contracts, shall be exempt from tax.’

8Article 43(13) of the Polish Law on turnover tax adds:

‘The tax exemption shall also apply to the supply of a service which constitutes an element of a service referred to in paragraph 1(7) and (37) to (41), which itself forms a distinct whole and is characteristic of and necessary for the supply of a service exempt under paragraph 1(7) and (37) to (41).’

II – Main proceedings and procedure before the Court

9The main proceedings concern the question of the extent to which the activity of the Polish company Aspiro SA (‘Aspiro’) is exempt from VAT. Aspiro supplies services consisting in comprehensive settlement of insurance claims on behalf of an insurer. It acts in the name and on behalf of the insurer vis-à-vis the insured person.

10Specifically, Aspiro receives insurance claims and conducts investigations. It establishes contact with the insured person, with whom it has no contractual relationship itself, and if necessary produces assessments and damage reports. After analysing the assembled documents, it adjusts losses and takes decisions on claims. Aspiro also conducts proceedings for recovery against third parties and handles complaints in respect of claim settlements. Aspiro performs various other administrative and technical functions in connection with these activities.

11The Polish tax authorities considered that exemption from VAT is possible only in respect of the processing and settlement of claims. In contrast, it considered that all other activities are not characteristic of the activity of an insurance undertaking and are not therefore covered by the exemption under Article 43(13) of the Polish Law on turnover tax.

12The Naczelny Sąd Administracyjny (Supreme Administrative Court), before which the dispute has now been brought, considers that EU law will determine the dispute and on 2 February 2015 referred the following question to the Court pursuant to Article 267 TFEU:

‘Must Article 135(1)(a) of the VAT directive be interpreted as meaning that services such as those in the present case, which are supplied on behalf of an insurance undertaking by a third party — in the name and on behalf of the insurer — which has no legal relationship with the insured person, are covered by the exemption referred to in that provision?’

13In the proceedings before the Court, Aspiro, the Republic of Poland, the United Kingdom of Great Britain and Northern Ireland and the European Commission submitted written observations. Asprio, the Polish tax authorities, the Republic of Poland and the Commission took part in the hearing on 2 December 2015.

III – Legal assessment

14By its question the referring court is essentially seeking to ascertain whether settlement of claims which is carried out in the name and on behalf of the insurer by a third party which has no contractual relationship with the insured person is to be exempted from VAT under Article 135(1)(a) of the VAT directive.

A – Admissibility

15Aspiro first challenges the admissibility of the question referred.

16In its view, the main proceedings concern the interpretation of national rules on VAT exemption, the conditions for which are satisfied in its case. The VAT directive cannot be invoked against it in this regard, as the duty to interpret national law in conformity with the directive may not in any case serve as the basis for an interpretation contra legem. It submits that the interpretation of Article 135(1)(a) of the VAT directive is thus irrelevant to the decision in the main proceedings.

17It is true that under Article 267 TFEU a question referred must be relevant to the decision in the main proceedings in order to be admissible. The crucial factor, however, is the assessment of the referring court, ⁷ which, in principle, the Court does not review, except in the case of obvious errors. ⁸

18There are no such errors here. The main proceedings concern exemption from VAT of an insurance-related service. This is covered by Article 135(1)(a) of the VAT directive. In this regard the referring court is required under EU law to interpret national law in conformity with the directive. ⁹ It does not appear that this is precluded by the wording of the relevant Polish rules. In particular, Article 43(13) of the Polish Law on turnover tax, which is at issue in the main proceedings, does not expressly exempt services like those supplied by Aspiro. That provision merely lays down abstract conditions which require interpretation and which appear to be readily amenable to consideration in the light of the requirements under EU law.

19The question referred is therefore admissible.

B – The answer to the question referred

20Services like those supplied by Aspiro are exempt under Article 135(1)(a) of the VAT directive if they relate to insurance or reinsurance transactions (see section 1) or related services performed by insurance brokers and insurance agents (see section 2).

1. Insurance and reinsurance transactions

21The Union legislature neither defined the term ‘insurance transactions’ within the meaning of Article 135(1)(a) of the VAT directive nor referred to national law for that purpose. It has to be construed independently in the context of EU law. ¹⁰

22According to settled case-law, the essentials of an insurance transaction are that the insurer undertakes, in return for prior payment of a premium, to provide the insured party, in the event of materialisation of the risk covered, with the service agreed when the contract was concluded. ¹¹ The concept also encompasses the provision of insurance cover by a taxable person who is not himself an insurer but who procures such cover for his customers by making use of the services provided by an insurer. ¹² In other words, the relevant factor is assumption of risk in return for payment. It presupposes a contractual relationship between the provider of the insurance service and the insured party. ¹³

23Those conditions are not met in this case. Aspiro neither provides the insured party with insurance cover by undertaking itself to cover risks nor is it in a contractual relationship with the insured party.

24Contrary to the claims made by some parties to the proceedings, an exemption is also not possible because the service provided by Aspiro (i) forms ‘a distinct whole’ which (ii) fulfils the ‘specific, essential functions’ of the insurance transactions exempted by Article 135(1)(a) of the VAT directive.

25Under such circumstances, as the Court has repeatedly ruled with regard to certain exemptions for financial services under Article 135(1) of the VAT directive, individual elements of an exempt service are indeed also exempt. ¹⁴ This always presupposes, however, that according to the wording of the ground for exemption the exempt service can actually be broken down into separate services. ¹⁵

26That is not the case with insurance transactions, however. Article 135(1)(a) of the VAT directive does not, for example, refer generally to transactions in the insurance business ¹⁶ or the management of insurance policies ¹⁷ but, according to its wording, only to insurance transactions in the strict sense, as the Court has repeatedly held. ¹⁸ The assumption of risk, which, according to case-law, is the sole constitutent of an insurance transaction, cannot be broken down into separate services.

27A Commission proposal for a directive, which could be construed as merely seeking to clarify that the principles developed by the Court in respect of the tax treatment of outsourced activities in the field of certain financial services also apply to insurance transactions, ¹⁹ is irrelevant in this connection. As it was not adopted by the Council, it does not have legal force and is therefore irrelevant to the interpretation of the applicable law, as is the view expressed by the Commission in that proposal.

28Lastly, no other conclusions can be drawn from the principle of fiscal neutrality, according to which similar goods or services may not be treated differently for VAT purposes. ²⁰ Aspiro endeavours to invoke that principle in order to apply the Court’s abovementioned case-law on outsourced elements of an exempt financial service to the exemption applicable to insurance transactions. However, as the Court has repeatedly made clear, that principle cannot extend the scope of an exemption in the absence of clear wording to that effect in the directive. ²¹

29The services provided by Aspiro do not therefore come under the definition of insurance transaction within the meaning of Article 135(1)(a) of the VAT directive. There is also no reinsurance transaction, as that is merely a particular form of insurance transaction in which two insurers are involved. ²²

2. Related services

30It must still be clarified whether Aspiro’s activity is exempt because it consists in services which are related to insurance transactions and are performed by an insurance broker and an insurance agent.

a) Services related to insurance transactions

31Under Article 135(1)(a) of the VAT directive, only ‘related services’ to insurance and reinsurance transactions are exempt. According to its wording, that expression is extremely broad and can in principle include all services having a link to insurance. ²³ Such a link undoubtedly exists in the case of an activity like the settlement of insurance claims.

b) Service performed by insurance brokers and insurance agents

32However, the service in question must also be performed by an insurance broker or an insurance agent in accordance with Article 135(1)(a) of the VAT directive.

33It is true that the referring court expressly stated in the order for reference that Aspiro is neither an insurance broker nor an insurance agent. Nevertheless, in the proceedings before the Court the United Kingdom in particular has rightly argued that there are doubts whether the referring court’s assessment is legally correct.

34According to the Court’s case-law, for recognition of a person as an insurance broker or an insurance agent regard must be had not to formal status as a taxable person, but to what the activities performed comprise. ²⁴ Consequently, in the present case it must also be examined whether the services provided by Aspiro in the field of settlement of claims comprise the activities of an insurance broker or an insurance agent for the purposes of Article 135(1)(a) of the VAT directive.

i) Relationship with the insurer and the insured party

35According to case-law, the provider of the service must, first, have a ‘relationship’ with both an insurer, or — in the case of insurance brokers ²⁵ — more than one insurer, and the insured party. ²⁶

36That is the case with Aspiro because it both has a de jure relationship with the insurer and maintains a de facto relationship with the insured party, namely in the context of the settlement of his claims. A merely de facto relationship of this kind, as also typically exists between an insurance agent and an insured party, is sufficient in this regard.

ii) Performing the core activity of an insurance broker or insurance agent

37Second, the provider of services related to insurance transactions must at least perform the core activity of an insurance broker or insurance agent. In Arthur Andersen the Court refers in particular to the ‘essential aspects’ of such activity, which consist in the finding of prospects and their introduction to the insurer with a view to the conclusion of insurance contracts. ²⁷ It is precisely this that distinguishes the activity of an insurance broker or insurance agent.

38Only an interpretation requiring that an activity be in regard to the conclusion of insurance contracts if it is to be exempt under the second variant of Article 135(1)(a) of the VAT directive is consistent with the requirement, confirmed in settled case-law, of strict interpretation in connection with the objective of that exemption. ²⁸

39The purpose of the exemption is not clear either from the directive itself or from the travaux préparatoires. ²⁹ The Court has, however, established a link between the exemption under Article 135(1)(a) and Article 401 of the VAT directive. That provision permits Member States to maintain ‘taxes on insurance contracts’. The exemption for insurance transactions and related services performed by insurance brokers and insurance agents is therefore intended to prevent double taxation to the detriment of the final consumer in those cases. ³⁰

40In the light of the requirement for strict interpretation, that objective is adequately achieved if services which have a direct connection with the conclusion of an insurance contract are exempt, as only taxation of such activity would directly impose VAT on the final consumer.

41If, on the other hand — as in the present case — an insurer outsources to a third party only some of the tasks for which it is responsible in connection with the open insurance policy, only the insurer is charged any resulting VAT. In Arthur Andersen the Court was thus unable to classify the mere outsourcing of the insurer’s activity as the activity of an insurance agent. ³¹

42It is true that, according to case-law, activities of an insurance broker or insurance agent which go beyond mere efforts towards the conclusion of an insurance contract can also benefit from exemption. However, this requires that they are connected with the core activity of a broker or agent, namely the finding of prospects and their introduction to the insurer. ³²

43Aspiro’s activity in this case does not satisfy this condition. It is engaged solely in settlement of claims, but does not perform any activities directed at the conclusion of insurance contracts.

44It can therefore be stated that the activity performed by Aspiro constitutes neither that of an insurance broker nor that of an insurance agent within the meaning of Article 135(1)(a) of the VAT directive because Aspiro does not perform their core activity.

iii) Directives on the free movement of insurance intermediaries

45The same conclusion must be drawn from the directives which promote the free movement of insurance intermediaries and which are cited by the United Kingdom as proof that settlement of insurance claims forms part of the characteristic activities of insurance brokers and insurance agents. In this regard the United Kingdom refers in particular to the descriptions of activities in Article 2(1) of Directive 77/92 and Article 2(3) of Directive 2002/92.

46There is no need to address the question whether the descriptions of activities in those directives are actually of decisive importance to the interpretation of the notions of insurance broker and insurance agent in Article 135(1)(a) of the VAT directive. Although the Court has referred additionally to Directive 77/92 in a number of rulings, ³³ it should nevertheless be noted that those directives promote the free movement of insurance intermediaries, ³⁴ whilst, as has been shown, ³⁵ the exemption at issue serves other objectives. For example, in a similar situation the Court held that a directive facilitating the free movement of doctors was not relevant for the purposes of exemption from VAT. ³⁶

47In any case, there is nothing in Directive 77/92 or its successor, Directive 2002/92, to call into question the conclusion that settlement of claims alone does not constitute an activity of an insurance broker or an insurance agent within the meaning of Article 135(1)(a) of the VAT directive.

48The description of the professional activities of insurance brokers and insurance agents in Directive 77/92 and the list of essential characteristics of ‘insurance mediation’ in Directive 2002/92 each mention assisting in the administration of insurance contracts in the event of a claim, that is to say assisting in the settlement of claims. ³⁷ However, this merely refers to a support activity relating primarily to insurance contracts formed on the initiative of professional practitioners.

49This must be clearly distinguished from comprehensive settlement of claims on behalf of an insurer, which is, for example, the task carried out by Aspiro in the present case. To this effect, it is also expressly stated in the third subparagraph of Article 2(3) of Directive 2002/92 that ‘the management of claims of an insurance undertaking on a professional basis’ is not regarded as insurance mediation within the meaning of that directive.

c) Interim conclusion

50All in all, it follows that settlement of insurance claims, as practiced by Aspiro, is also not exempt as related services to insurance or reinsurance transactions performed by insurance brokers or insurance agents under Article 135(1)(a) of the VAT directive.

3. Principle of fiscal neutrality

51Lastly, it must be clarified whether the overall conclusion reached is contrary to the principle of fiscal neutrality, which has particular importance in the Court’s case-law.

52It follows from that principle that traders must be able to choose the form of organisation which, from the strictly commercial point of view, best suits them, without running the risk of having their transactions excluded from the exemption provided for in Article 135(1)(a) of the VAT directive. ³⁸ That freedom of organisation for insurers could be called into question because they cannot transfer the processing of claims to another undertaking without being charged VAT. That VAT is charged because, as has been explained, the services of the other undertaking are not exempt from VAT under Article 135(1)(a) of the VAT directive and, on account of the exemption of its own transactions under that provision, the insurer generally has no right of deduction in respect of the services of the other undertaking under Article 168(a) of the VAT directive.

53However, these consequences stem from the fact that the exemption granted to the insurer — except for insurance activities outside the Union ³⁹ — does not give a right of deduction. This deliberate choice by the Union legislature restricts the insurers’ freedom of organisation as such. Any service obtained from a third party generally results in the insurer being charged VAT. As Advocate General Poiares Maduro has already stated, this is an inherent consequence of the common system of VAT. ⁴⁰

54Accordingly, it would be contrary to the legislature’s intention if any activity outsourced by an insurer were to be included in the exemption for insurance transactions, as this would also apply, for example, to an insurer’s office supplies obtained from a third party, since it is also an expression of its form of organisation not to produce the required office supplies within the undertaking itself.

55Consideration can therefore be given to the freedom of organisation of the taxable person only in so far as there is also an exemption for the outsourced activity. This depends in turn on the wording, scheme and objectives of the exemption. In this case, consideration of these aspects has revealed that merely outsourcing the processing of claims to a third party, which does not perform any activity with a view to the conclusion of insurance contracts, is not covered by the exemption referred to in Article 135(1)(a) of the VAT directive.

IV – Conclusion

56I therefore propose that the question referred by the Naczelny Sąd Administracyjny be answered as follows:

Settlement of insurance claims which is carried out in the name and on behalf of an insurer by a third party which has no contractual relationship with the insured person and whose activity does not include the finding of prospects and their introduction to the insurer with a view to the conclusion of insurance contracts does not come under the exemption referred to in Article 135(1)(a) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax.

¹ Original language: German.

² See, in this regard, judgments in CPP (C‑349/96, EU:C:1999:93); Skandia (C‑240/99, EU:C:2001:140); Taksatorringen (C‑8/01, EU:C:2003:621); Arthur Andersen (C‑472/03, EU:C:2005:135); Commission v Greece (C‑13/06, EU:C:2006:765); J.C.M. Beheer (C‑124/07, EU:C:2008:196); Swiss Re Germany Holding (C‑242/08, EU:C:2009:647); BGŻ Leasing (C‑224/11, EU:C:2013:15), and Mapfre asistencia and Mapfre warranty (C‑584/13, EU:C:2015:488).

³ OJ 2006 L 347, p. 1.

⁴ 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).

⁵ Council Directive 77/92/EEC of 13 December 1976 on measures to facilitate the effective exercise of freedom of establishment and freedom to provide services in respect of the activities of insurance agents and brokers (ex ISIC Group 630) and, in particular, transitional measures in respect of those activities (OJ 1977 L 26, p. 14).

⁶ Directive 2002/92/EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation (OJ 2003 L 9, p. 3).

⁷ See, for example, judgments in Asociación Española de Banca Privada and Others (C‑67/91, EU:C:1992:330, paragraph 25); Aprile (C‑125/94, EU:C:1995:309, paragraph 16); PreussenElektra (C‑379/98, EU:C:2001:160, paragraph 38); Elshani (C‑459/07, EU:C:2009:224, paragraph 40), and Križan and Others (C‑416/10, EU:C:2013:8, paragraph 53).

⁸ See, inter alia, judgments in Bosman (C‑415/93, EU:C:1995:463, paragraph 61); PreussenElektra (C‑379/98, EU:C:2001:160, paragraph 39); Omega (C‑36/02, EU:C:2004:614, paragraph 20), and Balázs (C‑251/14, EU:C:2015:687, paragraph 26).

⁹ See, for example, judgments in Von Colson and Kamann (14/83, EU:C:1984:153, paragraph 26); Pfeiffer and Others (C‑397/01 to C‑403/01, EU:C:2004:584, paragraph 113), and Indėlių ir investicijų draudimas and Nemaniūnas (C‑671/13, EU:C:2015:418, paragraph 56).

¹⁰ See judgments in CPP (C‑349/96, EU:C:1999:93, paragraph 15); Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 37); Commission v Greece (C‑13/06, EU:C:2006:765, paragraph 9); BGŻ Leasing (C‑224/11, EU:C:2013:15, paragraph 56), and Mapfre asistencia and Mapfre warranty (C‑584/13, EU:C:2015:488, paragraph 27).

¹¹ Judgments in CPP (C‑349/96, EU:C:1999:93, paragraph 17); Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 39); Commission v Greece (C‑13/06, EU:C:2006:765, paragraph 10); Swiss Re Germany Holding (C‑242/08, EU:C:2009:647, paragraph 34); BGŻ Leasing (C‑224/11, EU:C:2013:15, paragraph 58), and Mapfre asistencia and Mapfre warranty (C‑584/13, EU:C:2015:488, paragraph 28).

¹² See judgments in CPP (C‑349/96, EU:C:1999:93, paragraph 22); BGŻ Leasing (C‑224/11, EU:C:2013:15, paragraph 59), and Mapfre asistencia and Mapfre warranty (C‑584/13, EU:C:2015:488, paragraph 30).

¹³ See judgments in Skandia (C‑240/99, EU:C:2001:140, paragraph 41); Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 41); Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 22); BGŻ Leasing (C‑224/11, EU:C:2013:15, paragraph 58), and Mapfre asistencia and Mapfre warranty (C‑584/13, EU:C:2015:488, paragraph 29).

¹⁴ See judgments in SDC (C‑2/95, EU:C:1997:278, paragraph 66); CSC Financial Services (C‑235/00, EU:C:2001:696, paragraphs 25 to 27), and Nordea Pankki Suomi (C‑350/10, EU:C:2011:532, paragraph 24), with regard to the current Article 135(1)(d) and (f) in relation to transfers and equity-related transactions; judgments in Abbey National (C‑169/04, EU:C:2006:289, paragraph 70) and GfBk (C‑275/11, EU:C:2013:141, paragraph 21), with regard to the current Article 135(1)(g) in relation to the management of special investment funds; judgment in Ludwig (C‑453/05, EU:C:2007:369, paragraph 36), with regard to the current Article 135(1)(b) of the VAT directive in relation to the negotiation of credit.

¹⁵ See judgments in SDC (C‑2/95, EU:C:1997:278, paragraph 64); CSC Financial Services (C‑235/00, EU:C:2001:696, paragraph 23); Abbey National (C‑169/04, EU:C:2006:289, paragraph 67), and Ludwig (C‑453/05, EU:C:2007:369, paragraph 34).

¹⁶ See the wording of the exemption in Article 135(1)(d) of the VAT directive (‘im Geschäft’).

¹⁷ See the wording of the exemption in Article 135(1)(g) of the VAT directive.

¹⁸ See judgments in Skandia (C‑240/99, EU:C:2001:140, paragraph 36) and Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 43).

¹⁹ Proposal for a Council Directive amending Directive 2006/112/EC on the common system of value added tax, as regards the treatment of insurance and financial services, COM(2007) 747 final; under that Proposal, a paragraph 1a is to be inserted in Article 135 of the VAT directive with the following wording: ‘1a. The exemption provided for in points (a) to (e) of paragraph 1 shall apply to the supply of any constituent element of an insurance or financial service, which constitutes a distinct whole and has the specific and essential character of the exempt service.’

²⁰ See judgments in Linneweber and Akritidis (C‑453/02 and C‑462/02, EU:C:2005:92, paragraph 24); Rank Group (C‑259/10 and C‑260/10, EU:C:2011:719, paragraph 32), and Zimmermann (C‑174/11, EU:C:2012:716, paragraph 48).

²¹ See judgments in Deutsche Bank (C‑44/11, EU:C:2012:484, paragraph 45); Zimmermann (C‑174/11, EU:C:2012:716, paragraph 50); see also, with regard to the scope of a reduced rate of taxation, judgments in Commission v France (C‑479/13, EU:C:2015:141, paragraph 43), and Commission v Luxembourg (C‑502/13, EU:C:2015:143, paragraph 51).

²² See judgment in Swiss Re Germany Holding (C‑242/08, EU:C:2009:647, paragraph 38).

²³ See also the Opinions of Advocate General Fennelly in CPP (C‑349/96, EU:C:1998:281, point 31) and of Advocate General Poiares Maduro in Arthur Andersen (C‑472/03, EU:C:2005:8, point 20).

²⁴ See judgments in Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 32) and J.C.M. Beheer (C‑124/07, EU:C:2008:196, paragraph 17 et seq.).

²⁵ See judgment in Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 29).

²⁶ Judgments in Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 44); Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 33), and J.C.M. Beheer (C‑124/07, EU:C:2008:196, paragraph 20).

²⁷ See judgment in Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 36), with regard to insurance agents; see also, to that effect, judgment in Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 45), with regard to insurance brokers.

²⁸ See inter alia judgments in Stichting Uitvoering Financiële Acties (348/87, EU:C:1989:246, paragraph 13); Cimber Air (C‑382/02, EU:C:2004:534, paragraph 25); PFC Clinic (C‑91/12, EU:C:2013:198, paragraph 23), and De Fruytier (C‑334/14, EU:C:2015:437, paragraph 18).

²⁹ See in this regard the Opinions of Advocate General Poiares Maduro in Arthur Andersen (C‑472/03, EU:C:2005:8, point 13) and of Advocate General Jääskinen in Skandinaviska Enskilda Banken (C‑540/09, EU:C:2010:788, point 22).

³⁰ See judgments in CPP (C‑349/96, EU:C:1999:93, paragraph 23) and BGŻ Leasing (C‑224/11, EU:C:2013:15, paragraph 67).

³¹ See judgment in Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 38).

³² See judgment in J.C.M. Beheer (C‑124/07, EU:C:2008:196, paragraph 18).

³³ See judgments in Taksatorringen (C‑8/01, EU:C:2003:621, paragraph 45); Arthur Andersen (C‑472/03, EU:C:2005:135, paragraph 31), and J.C.M. Beheer (C‑124/07, EU:C:2008:196, paragraph 19).

³⁴ A Commission proposal (COM(2012) 360 final) to recast Directive 2002/92, which also contains a clear extension of the notion of ‘insurance mediation’, pursues the objective of improving consumer protection (see recital 9 in the preamble and Article 2(3) of the directive in the version in the Commission proposal).

³⁵ See above, point 39.

³⁶ See judgment in Unterpertinger (C‑212/01, EU:C:2003:625, paragraph 37).

³⁷ See Article 2(1)(a) and (b) of Directive 77/92 and the first subparagraph of Article 2(3) of Directive 2002/92.

³⁸ Judgment in J.C.M. Beheer (C‑124/07, EU:C:2008:196, paragraph 28).

³⁹ See Article 169(c) of the VAT directive.

⁴⁰ See Opinion of Advocate General Poiares Maduro in Arthur Andersen (C‑472/03, EU:C:2005:8, point 39).