- The European Court of Justice (ECJ) has published its decision in the Adient case concerning fixed establishments in the EU
- Adient is a group of companies in the automotive industry with a parent entity in Germany and a subsidiary in Romania
- The Romanian subsidiary provides manufacturing and assembly services to the parent company, as well as ancillary and administrative services
- The Romanian Tax Authorities concluded that the parent company had a fixed establishment in Romania, leading to VAT charges and penalties
- The ECJ decided that a fixed establishment is not created solely by one business providing services to another in the country of establishment
- The Court emphasized that the use of resources by a subsidiary should not trigger a fixed establishment
- The decision should provide more certainty on the issue of fixed establishments for businesses in the EU.
Source: essentiaglobalservices.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
Latest Posts in "European Union"
- Roadtrip through ECJ Cases – Focus on ”Free Products” (Art. 16)
- Briefing document & Podcast: C-438/13 (BCR Leasing Case) – Relief for Leasing Firms Facing Asset Non-Recovery
- VAT Neutrality and Tax Fraud: Implications of Recent Jurisprudence
- Blog Luc Dhont: How Can Multinationals Comply with VAT on Transfer Pricing Adjustments Post-ECJ Arcomet?
- Analysis of ECJ-cases on VAT for Ancillary Services in German Accommodation Sector
