- The European Court of Justice (ECJ) has ruled in the Cabot case that a Swiss principal does not have a fixed establishment in the country where its toll manufacturer, a legally distinct group entity, is established.
- The concept of VAT fixed establishment has been a source of litigation in several Member States, causing legal uncertainty for businesses.
- The notion of fixed establishment is important when assessing the place of supply rule, VAT liability, and cash flow perspective.
- The Cabot case provides clarity on the interpretation of VAT fixed establishment and offers clear guidance in relation to recent technical positions taken by some national tax authorities.
- PwC and PwC Legal assisted Cabot Corporation in the case.
Source PwC
See also
- ECJ C-232/22 (Cabot Plastics Belgium) – Judgment – Toll manufacturing with ancillary services does not lead to Fixed Establishment
- Summary of ECJ-232/22 (Cabot) – No fixed establishment due to lack of human and technical resources even if ancillary services are performed, exclusivity
