Language of document : ECLI:EU:C:2016:355

Case C‑607/14

Bookit Ltd

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 — Common system of value added tax — Directive 2006/112/EC — Exemption — Article 135(1)(d) — Transactions concerning payments and transfers — Meaning — Purchase of cinema tickets by telephone or via the Internet — Payment by debit card or credit card – ‘Card handling’ services)

Summary — Judgment of the Court (Second Chamber), 26 May 2016

1.        Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Banking transactions covered by Article 135(1)(d) of Directive 2006/112 — Meaning— Purchase of cinema tickets by telephone or via the Internet — Payment by debit card or credit card — ‘Card handling’ services — Not included

(Council Directive 2006/112, Art. 135(1)(d))

2.        Harmonisation of fiscal legislation — Common system of value added tax — Exemptions — Banking transactions covered by Article 135(1)(d) of Directive 2006/112 — Transactions concerning payments and transfers within the meaning of that article — Criteria for determination

(Council Directive 2006/112, Art. 135(1)(d))

1.        Article 135(1)(d) of Directive 2006/112 on the common system of value added tax must be interpreted as meaning that the exemption from value added tax which is provided for therein for transactions concerning payments and transfers is not applicable to a ‘card handling’ service, carried out by a taxable person, the provider of that service, where an individual buys, via that provider, a cinema ticket which the service provider sells for and on behalf of another entity, and which the individual pays for by debit card or by credit card.

The provider of a card handling service, which consists, in essence, for that taxable person, in obtaining, from the purchaser, the data pertaining to the payment card to be used, transmitting that data to its merchant acquirer, receiving the authorisation code issued by the card issuer, via that merchant acquirer, and then, when the ticket availability is confirmed, retransmitting that data and authorisation code to its merchant acquirer, plays no specific and essential part in achieving the changes in the legal and financial situation that are the result of a transfer of ownership of the funds concerned and that can be said to be characteristic of a transaction concerning payments or transfers that is exempted under Article 135(1)(d), but does no more than provide technical and administrative assistance for obtaining information and communicating that information to its merchant acquirer, and receiving, by the same means, the communication of information that enables it to effect a sale and to receive the corresponding funds.

(see paras 31, 51, 57, operative part)

2.        In order to be characterised as a transaction concerning transfers within the meaning of Article 135(1)(d) of Directive 2006/112 on the common system of value added tax, the services at issue must, viewed broadly, form a distinct whole, fulfilling in effect the specific, essential functions of a transfer and, therefore, having the effect of transferring funds and entailing changes in the legal and financial situation. In that regard, a service exempted under that directive must be distinguished from the supply of a mere physical or technical service. To that end, it is relevant to examine, in particular, the extent of the liability of the supplier of services, in particular the question whether that liability is restricted to technical aspects or whether it extends to the specific, essential aspects of the transactions. Further, since the functional aspects are decisive to the determination of whether a transaction concerns a transfer for the purposes of Article 135(1)(d), the test that makes it possible to distinguish a transaction that has the effect of transferring funds and bringing about changes in the legal and financial situation within the meaning of the Court’s case-law, which falls within the scope of the exemption concerned, from a transaction that does not have such effects and therefore is outside its scope, is whether the transaction under consideration causes the actual or potential transfer of ownership of the funds concerned, or fulfils in effect the specific, essential functions of such a transfer.

The considerations relating to transactions concerning transfers are also applicable to transactions concerning payments.

(see paras 40, 41, 43)