General Court T-184/25 (Veronsaajien oikeudenvalvontayksikkö) – Questions – Exemptions: Key Questions on Credit Management, Sureties, and Debt Transactions

Facts & Background

Case Overview: The case T-184/25 involves a preliminary court referral regarding the VAT treatment of loan management services provided by A Oy, a banking group entity, to B Oy. The case examines whether these services qualify as VAT-exempt financial services under Article 135 of the VAT Directive (2006/112/EC).
Key VAT Directive Article: The central legal question revolves around Article 135(1) of the VAT Directive, which outlines exemptions for financial services, particularly the management of loans and credits.
Preliminary Questions: The court is tasked with interpreting three key questions regarding VAT exemptions:
- Whether the exemption for management of credits applies when a financial institution sells credits to another institution but continues to manage them.
- If not, whether managing credits that serve as security for a bond qualifies for exemption under the sureties and guarantees provision.
- If that is also denied, whether managing transferred debts qualifies for exemption under the transactions concerning debts provision.
Deadlines for Submission: The Department must provide justification by May 6, 2025, and written comments are due by June 22, 2025.
Legal Implications: The outcome of this case could have significant implications for how VAT exemptions are applied to financial services, particularly in scenarios involving the sale and management of loans between financial institutions.

Articles in the EU VAT Directive 2006/112/EC

Articles 135(1)(b) and 135(1)(d) of the EU VAT Directive 2006/112/EC.

Article 135
1. Member States shall exempt the following transactions:
(b) the granting and the negotiation of credit and the management of credit by the person granting it;
(d) transactions, including negotiation, concerning deposit and current accounts, payments, transfers, debts, cheques and other negotiable instruments, but excluding debt collection;

Questions

If a financial institution sells the credits it has granted to a customer to another financial institution and continues to manage those credits itself for a fee after they have been sold, must Article 135(1)(b) of the VAT Directive, which provides for the exemption of the management of credits by the person who granted them, be interpreted as also applying to a situation in which the first-mentioned undertaking continues to manage the credits it has granted and sold to that other financial institution?
If the first question is answered in the negative and the management of credits by the first undertaking relates to credits serving as collateral for a bond issued by another financial institution, must Article 135(1)(c) of the VAT Directive, which provides for the exemption from entering into sureties and other security and guarantee obligations, be interpreted as also applying to a situation in which the first-mentioned undertaking manages credits serving as collateral for a bond issued by another financial institution?
If the second question is answered in the negative, must Article 135(1)(d) of the VAT Directive, which provides for the exemption of transactions concerning debts, be interpreted as also applying to a situation in which the first-mentioned undertaking manages debts transferred to another financial institution?

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