Does a Subsidiary Create a Fixed Establishment for VAT? Insights from Dong Yang Electronics Ruling

The CJEU ruled in Dong Yang Electronics (C-547/18) that the mere existence of a subsidiary in an EU Member State does not automatically constitute a “fixed establishment” for VAT purposes for the parent company.
The case involved a Polish subsidiary providing services to a Korean parent company, with the subsidiary maintaining its own facilities, VAT number, and legal personality.
The parent company did not have personnel, property, or technical infrastructure in Poland, and the service provider relied on this to invoice without charging Polish VAT.
The ruling clarified the limits of a service provider’s duty to inquire about the existence of a fixed establishment for VAT purposes.

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.