C-122/87

COMMISSION v ITALY

OPINION OF MR ADVOCATE GENERAL C R U Z VILAÇA delivered o n 15 M a r c h 1 9 8 8 *

Mr President, 4. During the pre-contentious phase and Members of the Court, likewise at the hearing the Government of the Italian Republic explained its reasons for its view that it was entitled, under that provision, to exempt services provided by veterinary surgeons. 1. The present Treaty-infringement proceedings relate to the provisions of Italian law — Article 10 of Decree N o 633 of the President of the Republic of 26 October 1972, as amended by Decree N o 5. The Commission, considering on the 24 of the President of the Republic of 29 other hand that the exemption was available January 1979, in conjunction with Article 99 only for medical care provided to persons, of Royal Decree N o 1265 of 27 July initiated the procedure provided for in 1934 — which exempt from VAT services Article 169 of the Treaty, relying upon four provided by veterinary surgeons in the sets of arguments which are summarized in exercise of their profession. the Report for the Hearing.

2. According to the Commission, that exemption is contrary to the Sixth Council 6. It must be stated that the Commission's Directive (77/388/EEC) of 17 May 1977 on view is well founded. VAT, ' in particular Article 2 thereof.

10. In the terms of the fifth recital in the 14. In particular, the Sixth Directive laid preamble to the First Directive 2'a system of down a uniform list of exemptions 'so that value-added tax achieves the highest degree the Communities' own resources may be of simplicity and of neutrality when the tax collected in a uniform manner in all the is levied in as general a manner as possible Member States' (11th recital). and when its scope covers all stages of production and distribution and the provision of services'. 15. For its part, the case-law of the Court is significant in that there has been a refusal to interpret broadly the exemptions provided 11. The generalized and uniform ap- for in the directive where no elements of plication of VAT to taxable transactions is interpretation are shown to exist which therefore essential to the attainment of the make it necessary to go beyond the literal objectives of the tax, ensuring the neutrality purport of the provisions in which they of the tax treatment of internal and interna- appear, in particular Article 13. 5 tional transactions and guaranteeing simplicity and financial effectiveness in the application of the tax; moreover, the use of a uniform basis for calculation of the 16. In the case of the exemption provided Community's own resources is thereby for in Article 13 A (1) (c), with which the facilitated. 3 present proceedings are concerned, even though that provision contains a reference to the definitions adopted by the Member States, it cannot be denied that the 12. That is the premise underlying the expressions used by the Community legis- fourth recital in the preamble to the Second lature have a common meaning, which Directive, 4 which states that 'in order to circumscribes the exercise of the discre- enable the system to be applied in a simple tionary power of the Member States, and and neutral manner and to keep the the objective must not be forgotten of deter- standard rate of tax within reasonable limits, mining 'the basis of assessment of value-added tax in a uniform manner 2 — Council Directive 67/227/EEC of 11 April 1967, Official according to the Community rules'. 6 Journal, English Special Edition 1967, p. 14. 3 — I gave a fuller account of the VAT system in my Opinion in Joined Cases 138 and 139/86 Direct Cosmetics, delivered 5 — See judgment of 11 luly 1985 in Case 107/84 Commission at the sitting on 27 January 1988 (see [1988] ECR 3937 v Federal Republic of Germany [1985] ECR 2655, paragraph and page 3749). 20. 4 — Council Directive 67/228/EEC of 11 April 1967, Official 6 — Judgment of 14 May 1985 in Case 139/84 Van Dijk's Journal, English Special Edition 1967, p. 16. Boekhuis [1985] ECR 1405, paragraph 19.

17. Since no provision of the directive lishments or centres for medical treatment makes clear what is to be understood by the and the paragraph relating to supplies of term 'the provision of medical care in the human organs, blood and milk — appears to exercise of the m e d i c a l . . . profession' it is confirm (as was also emphasized by the necessary to rely upon the meaning Commission) that it was intended to cover a attributed to that term in everyday set of activities of a particular social and language. In everyday language, the practice human dimension, connected with human of medicine or the provision of medical care health. 7 does not normally include the services of veterinary surgeons but only services provided to persons — the expression medical profession or practice must not be 22. The same approach is to be inferred, a confused with 'health care' as a whole, a contrario, from Article 28 (3) (b), in term which might indeed include the conjunction with Point 9 of Annex F, to services of veterinary surgeons. which the Commission referred. Article 28 lays down transitional conditions which allow the Member States to continue to exempt certain transactions for a period 18. That would seem to be the meaning to which is in principle limited, provided that be attributed to the Italian version of the such exemptions already existed when the Sixth Directive — which speaks of 'pres- directive entered into force (which, as both tazioni mediche' and 'professioni mediche' parties recognize, was not the case where without giving further details — unless there the services of veterinary surgeons in Italy are substantive reasons for adopting a were concerned); on the other hand, Article different interpretation. 13 A lays down a common list of exemptions favouring certain activities in the public interest which are imposed on the Member States, without any limitation as to 19. However, no such reasons exist and time. furthermore all the elements of interpre- tation available support the Commission's conclusion. 23. As they are expressly covered by the transitional conditions laid down by Article 28, the services of veterinary surgeons 20. That is borne out by a comparison of cannot at the same time be subject to the the Italian version with the German, common system of exemptions laid down in Danish, French and Dutch language Article 13. versions which, referring to the provision of care to persons, confirm expressis verbis that there was no intention to go beyond the ordinary meaning of the terms used. 24. Thus, Article 13 A (1) (c) can only be interpreted as relating exclusively to the provision of care to persons in the exercise of the medical profession and not to care 21. The context in which the paragraph administered to animals by veterinary referring to the exemption at issue is surgeons. placed — between the paragraph referring to hospital and medical care provided by 7 — That is the interpretation underlying the recent judgment of 23 February 1988 in Case 353/85 Commistion v United public bodies or other hospital estab- Kingdom [1988] ECR 817.