C-185/89

(iii) both consignments were placed in storage tanks rented by Forsythe from 1. In the case on which I give my opinion a storage company and from there, on today the Court has been asked by the instructions from Forsythe, which did Hoge Raad der Nederlanden to interpret not operate any vessels itself, delivered Article 15(4)(a) of Directive 77/388/EEC to departing sea-going vessels. on the harmonization of the laws of the Member States relating to turnover taxes — Common system of value-added tax: uniform basis of assessment, 1 that is to say the provision under which Member States exempt from the tax 'the supply of 3. The VAT inspector responsible regarded goods for the fuelling and provisioning of the application of zero-rating by the vessels' of a certain kind. respondent, that is to say the non-invoicing of VAT, as unjustified. In his view 'fuelling and provisioning of vessels' within the meaning of the Netherlands Law of 28 2. An interpretation was considered December 1978 can only mean a delivery necessary in connection with the supply by which coincides with the fuelling and pro- the respondent in the main proceedings of visioning of a vessel, that is to say a delivery two consignments of bunker oil to Forsythe on board the vessel followed directly by International BV, of The Hague, on which export. That is also the view taken by the the respondent did not invoice VAT. It is Staatssecretaris van Financiën, the appellant important to be aware of the particular in the main proceedings. He considers also circumstances surrounding the deliveries, that Article 15(4)(a) of the VAT directive, which were that: transposed by the said Law of 28 December 1978 into Netherlands law, does not cover supplies to anyone who merely states that the goods are for the fuelling and pro- visioning of vessels; that is too far removed (i) one consignment originated from Olie from actual fuelling and provisioning and Verwerking Amsterdam, was sold by does not prevent a change in intended use the latter to Verhoeven Rotterdam, before the goods are loaded on board. The resold by Verhoeven to the respondent appellant in the main proceedings points out and delivered direct by Olie in addition that extension of the exemption Verwerking to Forsythe; to supplies preceding actual fuelling and provisioning requires prior consultation with * Original language: German. the Advisory Committee pursuant to Article 1 — OJ 1977, L 145, p. 1.

B — Observations 10. On that point the judgment referring questions to the Court specifically stated 6. 1. Before I address the specific issue, I that that issue — which had apparently not think I should make two preliminary been put forward previously — could not be remarks, prompted by arguments put raised in the proceedings before the Hoge forward in the course of the proceedings. Raad. The Hoge Raad is obliged to ignore the point and there is therefore no call for us to examine it further in connection with our task of construing the V A T Directive. 7. (a) The Commission submitted written observations concerning inter alia the term 'supply of goods' within the meaning of Article 5 of the VAT Directive. The point 11. 2. As far as the problem actually arose in connection with the fact that the referred to the Court is concerned, it is bunker oil in question was delivered by apparent that not only the parties to the Olieverwerking and Verhoeven direct to main proceedings but also those who took Forsythe and was apparently mixed with part in the procedure before the Court have

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OPINION OF MR LENZ —CASE C-185/89

12. On the other side there is the view taken by the Government of the Federal 15. (bb) Case 107/84 Commission v Republic of Germany, according to which Federal Republic of Germany,3 which turned Article 15 should be given a broad interpret- on Article 13(A)(1)(a) of the directive ation, as suggested in the second question (concerning the supply of services by the referred to the Court. According to that public postal services), was similar. Although interpretation Article 15(4)(a) would also the Court, which found in favour of a strict cover supplies at previous stages in the interpretation, stressed that that provision commercial chain as long as the intended did not include services supplied by other use (fuelling and provisioning of sea-going undertakings on behalf of the postal services vessels) is clearly established. Although of (and that it was not therefore possible to course it could not be inferred from the extend it to operations carried out to the observations made during the proceedings, same end but by other services), it should that latter solution would appear to not be forgotten that that was simply as a correspond to the practice in certain other result of the fact that in the said provision Member States (Denmark, Greece, Italy and the body entitled to exemption was referred France). (There is, however, a restriction in to explicitly. France, if I understand correctly, in that only the final supply prior to supply to the vessel operator qualifies.) 16. (cc) On the other hand it is rather interesting that in the judgment in Case 415/85 4 (and similarly in Case 416/85 5 ) in connection with tax exemption for social

20. It should in addition be acknowledged 17. (b) It must also be admitted (not least that (as the German Government also in consequence of the last-cited judgment), pointed out) from the point of view of that the wording of the provision before the apparent purpose of the exemption us — as the German Government has rightly provision (which is not the bestowing of pointed out — by no means suggests that a financial advantages, but manifestly admin- narrow construction is mandatory. istrative simplification) there is an argument for subsuming transactions preceding direct fuelling and provisioning under Article 15(4), because undertakings which are engaged therein are in any case relieved of 18. That is apparent from the English any tax burden by way of deduction. It does version ('supply of goods for the fuelling not seem unreasonable to spare them from and provisioning of vessels') and the tax procedures from the outset if the final German version ('Lieferung von Gegen- recipient does not have to pay tax. ständen zur Versorgung von Schiffen'), neither of which implies that the fuelling and provisioning must be immediate. The Dutch, Italian, French and Portuguese versions are even clearer, focusing on the intended purpose ('levering van goederen, 21. (c) In my opinion it is moreover clear bestemd voor de bevoorrading van de that two arguments which have been put navolgende schepen'; 'cessioni di beni forward by the advocates of a narrow inter- destinati al refornimento e al vetto- pretation are not very effective in cor- vagliamento di navi'; 'livraisons de biens roborating that point of view. desunes à ravitaillement des bateaux'; 'entragas de bens destinados ao abaste- cimento de baços'). 22. (aa) One of these is the reference to the fact that in a final subparagraph in the provision in question it is stated that the 19. If one compares the provisions of the Member States may 'restria the scope of directive which refer specifically to the this exemption until the implementation of recipient of services and goods (such as, for Community tax rules in this field'. In my instance, Article 13(A)(1)(f) and (1): services view that does not necessarily suggest that supplied by groups of persons and bodies to a narrow construction is required at all; their members; Article 15(11): supplies of rather, it supports the opposite point of view, that is to say that if the introduction 6 — OJ, English Special Edition, 1967, p. 16. of a possibility of restricting its scope was

thought to be warranted it must be assumed 26. As it is worded, it certainly does not that the provision itself should be appear to lend itself easily to operations understood in a broad sense. such as those described in Article 15(4), but rather — as the German Government has rightly pointed out — to be principally designed to cover export operations as such. 7 For those, however, it applies in every case, that is to say it is also relevant if 23. Of course — and this is anticipating the operation of fuelling and provisioning another argument put forward in the vessels which is treated as an export were to proceedings — that does not necessarily be understood in a broad sense and in mean that the said final subparagraph lends consequence application of Article 16(2) clear support for a very broad interpretation was excluded. of Article 15(4) in the sense of the second question referred to the Court, thus bearing out the German Government's panicular viewpoint (as we know, it considered that the final subparagraph would be devoid of meaning if the provision were construed narrowly). For even if it must be assumed 27. (d) Finally, although — as I believe that Article 15(4) only covers supplies to — when all is said and done there is no vessel operators, one can easily imagine alternative but to uphold the view of those possible restrictions, for instance with who argue for a narrow interpretation of regard to the goods which might be Article 15(4) of the VAT directive, the considered for exemption or to the effect following considerations are of relevance. that only supplies effected directly on board (excluding previous storage) would be considered. The final subparagraph of Article 15(4) makes as much sense if it is given a narrow construction as when it is interpreted as the German Government 28. (aa) It is certainly significant that the suggests. directive is made subject to the principle that every business transaction within the territory of a country is liable to tax. It follows that — where provision is made for exemptions — an application of an 24. (bb) Secondly, there is the reference to exemption that extends to several economic Article 16(2) (by virtue of which, subject stages appears justifiable only on very to the consultation with the Advisory imperative grounds. It is, however, doubtful Committee provided for in Article 29, whether the idea adduced by the German Member States may opt to exempt inter alia Government of administrative simplification supplies of goods to a taxable person suffices (that is to say, the avoidance of tax intending to export them). computations, tax payment and deduction of inputs by traders who, inasmuch as they are not the final consumer, are not ulti- mately subject to a tax burden). It is also quite clear that the interpretation advocated by the German Government — and I shall 25. It surely cannot be said of that return to this point — could also involve provision that it is superfluous if Article 15(4) is given a broad interpretation. 7 — Sec the headings to Articles 15 and 16.

29. (bb) Furthermore, it is significant — and this remark relates to the structure of Article 15 as a whole — that (as must be inferred from the heading to Article 15) supplies for 32. What strikes one immediately is that it the fuelling and provisioning of vessels are is hard to reconcile that reference with treated as like transactions because it is to a systematically generous application of be expected that consumption will take Article 15(4) which includes supplies prior place abroad. If, however, with regard to to the actual supply for fuelling and provi- the export transactions as such covered in sioning. It appears possible, if the provision the first numbered paragraphs of Article 15, is applied in that way, that is to say if the adherence to a strict criterion is required intention of the previous suppliers is focused (dispatch to a destination outside the upon, that that intention might later be Community), it must be regarded as only changed and the goods supplied reach the proper and in accordance with the system to domestic market. In that way distortions of apply to like transactions a similarly strict competition could arise and if such facts standard and to stress the importance of a subsequently came to light ex post facto close connection between supply and correction of the tax treatment would be fuelling and provisioning. necessary (which can hardly be regarded as administrative simplification). If such irregu- larities are to be excluded from the outset, however, specific monitoring measures are necessary, which (quite apart from the fact that they could amount to obstacles to 30. (cc) One further consideration relating trade) do not exactly represent adminis- to Article 16(2) of the VAT directive cannot trative simplification either. be completely disregarded. If — as can be said to be the case — as regards export transactions an extension of the exemption to persons who only intend to export is only 33. The arguments put forward on that possible after consultation with the Advisory point by the German Government's Committee, it would not appear logical in representative at the hearing do not really the case of like transactions within the provide grounds for reaching any other meaning of Article 15(4) to reach the same conclusion. No regard can be had to the result (extension to previous input stages in fact that the practice of the German the commercial chain) by means of a broad Government (the use of computers for interpretation of the term 'the supply of checking purposes inter alia apparently plays goods for the fuelling and provisioning of a role) might easily become generalized. It vessels'. Even though it must be admitted must be said, however, that it appears that Article 16(2) is not directly designed to inconceivable that the relevant part of the cover like transactions, it is much more first paragraph of Article 15 should be seen appropriate to use the provision by analogy as granting a degree of flexibility to the in order to obtain exemption for trans- Member States according to the adminis- actions preceding actual supply for the trative means at their disposal. It must be fuelling and provisioning of vessels. more correct to assume that the case for

exemption before us is governed by the nothing in the wording of the provision to formula used in Article 15(4) and that must support that (the Commission proposal in principle be understood in a uniform mentioned by the Netherlands Government Community way. Derogations are only which has not yet been adopted by the possible pursuant to the final subparagraph Council is clearly irrelevant). Against that of Article 15(4) mentioned previously. To view, reference may be made to the term permit derogations on the basis of the intro- 'supply' (according to Article 5 it is the basis ductory paragraph of Article 15 would, on of the right to dispose of property as an the other hand, be contrary to the structure owner); that definition surely suggests that of the system and constitute a misinterpret- the giving of the power of disposal to the ation of the meaning of its wording, which person who uses the goods for the fuelling is also to be found in other provisions in the and provisioning of ships, that is to say, to directive. the operator of the vessel, is determinant, and that does not rule out interim storage before the goods are loaded onto the vessel. 34. (e) Accordingly, although a broad interpretation of Article 15(4), as advocated by the German Government, cannot be 35. It should perhaps be added that any accepted as correct (and, if need be, the misgivings with regard to the risk of abuse same result can be obtained by applying (which is seen as the critical factor by the Article 16(2) by analogy), it seems to me on proponents of a very narrow interpretation) the other hand that it is also clear that there can be taken into account by way of are no imperative reasons for sanctioning recourse to the final subparagraph of Article the very narrow construction advocated by 15(4), that is to say that Member States the Governments of the Netherlands, the who regard it imperative to subject the United Kingdom and Portugal, to the effect application of Article 15(4) to very strict that there is supply for the fuelling and requirements are quite at liberty to provide provisioning of vessels only when the goods for a restriction on the exemption in are loaded directly onto the vessel. There is reliance on that final subparagraph.