Referral to ECJ – VAT grouping & partnerships

The following questions are referred to the Court of Justice of the European Union – ECJ – for a preliminary ruling:1. Is Article 11 (1) of Council Directive 2006/112 / EC of November 28, 2006 on the common value added tax system – UStSystRL – to be interpreted in such a way that it complies with the provisions of Section 2 (2) No. 2 of the Value Added Tax Act – UStG – stands in the way, insofar as this precludes a partnership (here: a GmbH & Co. KG), in which shareholders are not only persons who are not only the parent company, but who are financially integrated into the company of the parent company according to Section 2 Paragraph 2 No. 2 UStG is to be a subsidiary in the context of a VAT group?

2. If the answer to question 1 is answered in the affirmative:

a. Article 11 (2) of the VAT Directive – taking into account the principle of proportionality and neutrality – must be interpreted in such a way that it can justify the exclusion of partnerships of the type mentioned in the question referred to 1. from a VAT group, because partnerships for the conclusion and amendment There are no formal requirements for company contracts under national law and, in the case of mere verbal agreements, there may be difficulties in proving the financial integration of the subsidiary in individual cases?

b. Does it contradict the application of Art. 11 Para. 2 VATSRL if the national legislature did not already intend to prevent tax evasion or avoidance when the measure was adopted?

Source Finanzgericht Berlin-Brandenburg

Unofficial translation in English

Source KPMG

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