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ECJ Case C-692/17 (Paulo Nascimento Consulting) – Opinion – Exemption for transactions relating to the granting, negotiation and management of credit – assignment of a position held in enforcement proceedings for recovery of a debt recognised by a judgment

On 2 May 2019, Advocate General M. HENRIK SAUGMANDSGAARD gave its opinion in case C-692/17 (Paulo Nascimento Consulting – News Mediação Imobiliária Lda). This case deals with the question if and when transactions relating to the granting and negotiation of credit and the management of credits are exempt from VAT.

Unofficial translation

Considerations (simplified)

The reference for a preliminary ruling made by the Supremo Tribunal Administrativo (Supreme Administrative Court, Portugal) was submitted in the context of a dispute concerning the value added tax (VAT) payable by a real estate agency under the transfer, for a third party, of the position held by that taxable person in proceedings for the purpose of enforcing the recovery of a claim that has been recognized by a court decision.

The question referred by the referring court concerns the interpretation of Article 135 (1) (b) of Directive 2006/112 /EC, which provides for a VAT exemption for a taxable person consisting in the granting and negotiation of credits and the management of credits by the person who has granted them.

3. In order to give a useful answer to that court, the AG considers that the Court should also decide in the present case on the interpretation of Article 135 (1) (d), which provides VAT exemption, in particular, for the transactions of a taxable person relating to claims, except in the case of debt recovery.

4. For the reasons set out in this Opinion, the AG considers that the said points (b) and (d) must be interpreted as meaning that the exemptions referred to therein are not to be applied in circumstances such as those of the dispute in the main proceedings.

Opinion

The Advocate General is of the opinion that::

Article 135 (1) (b) and (d) VAT Directive must be interpreted as meaning that value-added tax exemptions provided for in points (b) and (d), for transactions relating to the granting and negotiation of credit or the management thereof respectively and to claims, do not apply to a transaction such as that at issue in the main proceedings, where the taxable person is to transfer to a third party, for a fee paid by him, his position in an enforcement proceeding, which seeks the recovery of a claim which has been recognized by a court decision and the payment of which was secured by a right in a real estate seized having been awarded.

Source: Curia (French version – English not yet available)

 

 

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