On September 22, 2016 on the website of the Court of Justice of the European Union (CJEU) the opinion of Advocate General Bot in Case C‑471/15 Sjelle Autogenbrug I/S versus Skatteministeriet (ECLI:EU:C:2016:724) was published.
In the circumstances of the present case, can parts from end-of-life vehicles which a VAT-registered vehicle reuse undertaking removes from a vehicle with a view to resale as spare parts be regarded as “second-hand goods” as referred to in Article 311(1)(1) of Directive 2006/112?
The facts in the main proceedings and the question referred for a preliminary ruling
· Sjelle Autogenbrug I/S is a vehicle reuse undertaking whose main activity is the resale of used motor vehicle parts which it removes from end-of-life vehicles.
· Sjelle Autogenbrug also engages in the environmental and waste treatment of end-of-life vehicles, a service for which it charges a standard price. Lastly, a lesser part of the undertaking’s overall turnover derives from the sale of scrap metal remaining after removal of the motor vehicle parts.
· Sjelle Autogenbrug purchases end-of-life vehicles — which are either vehicles whose lifespan has expired or total write-offs — from individuals and insurance companies who do not declare VAT on sales made.
· Sjelle Autogenbrug currently declares VAT pursuant to the applicable general rules. On 15 July 2010, it asked the tax authorities to apply the special margin scheme for second-hand goods to its activity of reselling used motor vehicle parts taken from end-of-life vehicles.
· On 6 August 2010, the tax authorities issued a binding decision to Sjelle Autogenbrug stating that the undertaking was not eligible for such a scheme because the motor vehicle parts in question were not covered by the definition of ‘second-hand goods’ within the meaning of the applicable law.
· By order of 12 December 2011, the Landsskatteretten (Tax Tribunal) confirmed the tax authorities’ decision. Sjelle Autogenbrug lodged an appeal against that order before the referring court.
· Since it was uncertain as to how to interpret Article 311(1)(1) of Directive 2006/112, the Vestre Landsret (Western Court of Appeal) decided to stay the proceedings and to refer the following question to the Court for a preliminary ruling:
‘In the circumstances of the present case, can parts from end-of-life vehicles which a VAT-registered vehicle reuse undertaking removes from a vehicle with a view to resale as spare parts be regarded as “second-hand goods” as referred to in Article 311(1)(1) of Directive 2006/112?’
Conclusion
The Advocate General proposes that the Court give the following reply to the Vestre Landsret (Western Court of Appeal):
Article 311(1)(1) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax must be interpreted as meaning that the definition of ‘second-hand goods’ covers motor vehicle parts which, after being removed from an end-of-life vehicle acquired by a vehicle reuse undertaking from an individual, are resold as spare parts, thereby rendering the taxable dealer eligible for the margin scheme.
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