In its judgment rendered on case c-232/22, Cabot Plastics Belgium SA, the Court of Justice has returned its ruling on the requirements necessary to integrate a permanent establishment for VAT purposes under Art. 44 of Directive 2006/112/EC and Art. 11 of Regulation 282/2011. In particular, referring to the criteria enunciated in some precedents (see C-333/20 – Berlin Chemie A. Menarini and C-605/12 – Welmory), the Justices also focused on the evidence needed to prove the existence of a concealed permanent establishment, and also provided additional insights from previous rulings.
Referring to the aforementioned judgments of the Court itself, some useful clarifications were made (see paragraphs 39, 41 and 46), through which the notion of a Permanent Establishment was circumscribed. Very interesting is the passage in which the Justices, referring to the European Commission’s guideline, clearly state that since the service provider remains responsible for his own means and provides the services at his own risk, the contract for the provision of services, although exclusive, does not determine that the means of that provider become those of his client.
Because of this element, as well as the additional circumstances emphasized during the proceedings, the Court concluded that a taxable person does not have a permanent establishment in the member state of the service provider, in the absence of a suitable structure in terms of human and technical means, even in the event that “the taxable person providing the services provides to that taxable person receiving services, pursuant to an exclusive contractual undertaking, tolling services and a series of ancillary or additional services, contributing to the business of that taxable person receiving services in that Member State.”