Case C‑633/15

London Borough of Ealing

v

Commissioners for Her Majesty’s Revenue and Customs

(Request for a preliminary ruling from the
First-tier Tribunal (Tax Chamber)]

(Reference for a preliminary ruling — Taxation — Value added tax (VAT) — Directive 2006/112/EC — Exemptions of supplies of services closely linked to sport — Article 133 — Exclusion of the exemption in the event of a risk of distortion of competition to the disadvantage of commercial enterprises subject to VAT — Services supplied by non-profit making organisations governed by public law)

Summary — Judgment of the Court (Fourth Chamber), 13 July 2017

1.        Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Exemptions for certain activities in the public interest — Supplies of services closely linked to sport or physical education — Exclusion of exemption in the event of a risk of distortion of competition — Bodies governed by public law supplying those services — National legislation applying that exclusion to those bodies governed by public law — Lawfulness

(Council Directive 2006/112, Arts 132(1)(m) and 133, first para. and second para, (d))

2.        Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Exemptions for certain activities in the public interest — Supplies of services closely linked to sport or physical education — Exclusion of exemption in the event of a risk of distortion of competition — Non-profit making organisations governed by public law supplying those services — National legislation applying that exclusion solely to non-profit making organisations governed by public law — Unlawful

(Council Directive 2006/112, Arts 132(1)(m) and 133, first para. and second para, (d))

1.      The second paragraph of Article 133 of Council Directive 2006/112 of 28 November 2006 on the common system of value added tax must be interpreted as not precluding the legislation of a Member State from providing that compliance with the condition laid down in point (d) of the first paragraph of Article 133 of that directive is a prerequisite for the grant of a VAT exemption to bodies governed by public law that supply services closely linked to sport or physical education, within the meaning of Article 132(1)(m) of that directive, even though, on the one hand, on 1 January 1989 that Member State did not apply VAT to all those supplies of services and, on the other, the supplies of services at issue were not exempted from VAT before the requirement of compliance with that condition was imposed.

(see para. 26, operative part 1)

2.      The second paragraph of Article 133 of Directive 2006/112 must be interpreted as precluding national legislation, such as that at issue in the main proceedings, where that legislation provides that compliance with the condition laid down in point (d) of the first paragraph of Article 133 of that directive is a prerequisite for the grant of a VAT exemption to non-profit making organisations governed by public law making supplies of services closely linked to sport or physical education, within the meaning of Article 132(1)(m) of that directive, but fails also to apply that condition to non-profit making organisations other than those governed by public law that make such supplies of services.

(see para. 33, operative part 2)