Investment fund industry – Two more VAT cases brought before the European Court of Justice
After the BBL case (decided in October 2004) and the Abbey National case (still pending), two more cases dealing with VAT in the investment fund industry are being brought before the European Court of Justice (ECJ).
These VAT cases deal with the scope of the VAT exemption applicable to the management of investment funds. This exemption is not always interpreted homogenously throughout the EU.
A reference for a preliminary ruling has been made to the ECJ by the Direction of the VAT and Duties Tribunals in the proceedings between J.P. Morgan Fleming Claverhouse Investment Trust plc, the Association of Investment Trust Companies and Commissioners of HM Revenue and Customs.
In the meantime, the Dutch Supreme Court has referred questions to the ECJ in a case also dealing with the VAT treatment of services rendered in an asset management context.
These two cases arise from different backgrounds and could turn out to be of a special interest. Notably, the “JP Morgan” case addresses questions that are unlikely to be settled in the awaited Abbey National case.
No doubt that the issue of VAT for investment management models is becoming even more important. This will require special attention in the coming months.
VAT - Investment fund industry
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