- The General Court held that Article 11 of the VAT Directive can limit Denmark’s VAT grouping rules: a 100% ownership requirement for grouping is not automatically compatible with EU law.
- A blanket exclusion based on capital ownership, rather than on a real risk of VAT fraud or avoidance, was found too broad; a purely theoretical revenue-risk concern is not enough.
- The Court said anti-avoidance objectives must be pursued by measures that are necessary and appropriate, and less restrictive alternatives should be used where available.
- As a result, national rules making VAT grouping conditional on one member owning 100% of the others’ capital are precluded unless that condition is justified as a necessary anti-abuse measure.
Source: schjodt.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.
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