Comments on ECJ C-603/24: VAT and Transfer Pricing Adjustments: AG Kokott’s Opinion in Stellantis Portugal

• Advocate General Kokott’s opinion in Stellantis Portugal (C-603/24) addresses the tension between VAT treatment and transfer pricing adjustments within groups, especially after the Arcomet Towercranes (C-726/23) case.
• In Arcomet, the Court ruled that transfer pricing adjustments related to services provided within a group could be considered taxable services, but left key underlying questions unresolved.
• Kokott argues that not every transfer pricing adjustment (true-up) constitutes a service for VAT purposes; it depends on whether the adjustment is merely a price change for a previous supply or a payment for a new service.
• The distinction is crucial: if only the consideration for a previous supply is changed, it falls under VAT rules for price adjustments, not as a separate service.
• The core issue is whether a transfer pricing correction is linked to a specific supply or service, or if it falls outside the scope of VAT altogether.

Source: vat-consult.be

See also ECJ C-603/24 (Stellantis Portugal) – AG Opinion – VAT Adjustments in Intra-Group Transfer Pricing Not Separate Supplies – VATupdate

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