How to establish a VAT group — New risk for VAT groups that are not based on identical management or domination agreements but merely on directors’ resolutions

The going concern value-add tax (VAT) relief for VAT purposes can be granted in case of a share deal (transfer of a subsidiary) if the transferred company is part of a VAT group on the side of both the seller and the buyer. In the case at hand, however, the court refused to accept the relevant VAT group, as the required domination of the subsidiary failed due to an insufficient “managing directors’ resolution” (this concept is regularly used in practice; hence, companies should review their VAT group structures).