CAAD Decision 228/2015-T: VAT Exemption on Intra-Community Transactions Under Article 14(a) RITI

ARBITRAL AWARD[1]

Claimant – A… – …, Lda.

Respondent - Tax and Customs Authority

Dr. Sílvia Oliveira, Arbitrator, appointed by the Deontological Council of the Administrative Arbitration Center (CAAD) to constitute the Arbitral Tribunal, constituted on 29 June 2015, with respect to the above-identified case, has decided as follows:

1. STATEMENT OF FACTS

1.1 A… – …, LDA., Legal Entity no. …, with registered address at Lugar de …, ... da …, … …, Guimarães, registered in the Commercial Registry Office of Guimarães under no. … (hereinafter referred to as Claimant), filed a request for arbitral ruling and constitution of a Single Arbitral Tribunal on 1 April 2015, pursuant to the provisions of Article 4 and no. 2 of Article 10 of Decree-Law no. 10/2011, of 20 January [Legal Regime of Tax Arbitration (RJAT)], in which the Tax and Customs Authority is the Respondent (hereinafter referred to as Respondent).

1.2 The Claimant seeks through its request for arbitral ruling that there be declared the "annulment of the assessments that form the basis of the collection documents (…) identified, as they refer to transactions exempt from VAT, pursuant to paragraph a) of Article 14 of RITI".[2]

1.3 The request for constitution of the Arbitral Tribunal was accepted by the Esteemed President of CAAD on 6 April 2015 and was notified to the Respondent on 10 April 2015.

1.4 The Claimant did not proceed to appoint an arbitrator, therefore, pursuant to Article 6, no. 2, paragraph a) of RJAT, the undersigned was appointed as arbitrator on 26 May 2015 by the President of the Deontological Council of CAAD, the appointment having been accepted within the statutory time period and terms.

1.5 On the same date, the Parties were duly notified of such appointment, and neither manifested a wish to refuse the appointment of the arbitrator, pursuant to the combined provisions of Article 11, no. 1, paragraphs a) and b) of RJAT and Articles 6 and 7 of the Deontological Code.

1.6 Thus, in accordance with the provisions of paragraph c), no. 1, of Article 11 of RJAT, the Arbitral Tribunal was constituted on 29 June 2015, an arbitral order having been issued on 30 June 2015, to notify the Respondent to, "pursuant to the provisions of Article 17, no. 1 of RJAT, submit its answer within a maximum period of 30 days and, should it wish, request the production of additional evidence".

1.7 On 11 September 2015, the Respondent filed its Answer, having defended itself by way of objection and concluded the same to the effect that "the present request for arbitral ruling should be judged without merit, with all due and legal consequences".

1.8 On the same date, the Respondent forwarded the administrative file to CAAD.

1.9 On 16 September 2015 an arbitral order was issued notifying both Parties to pronounce themselves, within a period of five days, on the possibility of waiving the holding of the meeting referred to in Article 18 of RJAT, as well as waiving the submission of written arguments.

1.10 On 18 September 2015, the Respondent submitted a reply to the arbitral order referred to in the preceding point to the effect of "not opposing the waiver of the holding of the meeting referred to in Article 18 of RJAT", as well as to the effect of "not opposing the waiver of submission of written arguments".

1.11 The Claimant did not pronounce itself regarding the contents of the arbitral order referred to in point 1.9., above.

1.12 In these terms, it was decided by the Arbitral Tribunal, in an order dated 28 September 2015, in accordance with the procedural principles enshrined in Article 16 RJAT, the autonomy of the arbitral tribunal in the conduct of proceedings and determination of the rules to be observed [paragraph c)], cooperation and good faith in proceedings [paragraph f)] and the free conduct of proceedings enshrined in Articles 19 and 29, no. 2 of RJAT, and further taking into account the principle of limitation of unnecessary acts provided in Article 130 of the Code of Civil Procedure (CPC) [applicable by virtue of the provisions of Article 29, no. 1, paragraph e) of RJAT], to dispense with the holding of the meeting referred to in Article 18 of RJAT, as well as to dispense with the submission of written arguments, with 29 October 2015 being designated for the purpose of rendering the arbitral award.

1.13 Within the scope of the arbitral order referred to in the preceding point, the Claimant was further warned that "until the date of rendering of the arbitral award it should proceed to payment of the subsequent arbitration fee, pursuant to the provisions of no. 3, of Article 4 of the Regulations on Costs in Tax Arbitration Proceedings and communicate such payment to CAAD".

2. GROUNDS OF CLAIM

2.1 The Claimant seeks through its request for arbitral ruling that there be declared the "annulment of the assessments (of VAT) that form the basis of the collection documents (…) identified, as they refer to transactions exempt from VAT, pursuant to paragraph a) of Article 14 of RITI".

2.2 In this context, the Claimant states that "as a consequence of an inspection action carried out by the Tax Administration services on the Claimant" were made "corrections in the area of VAT, relating to the year 2010, (…) in a total of EUR 4,397.77" (tax and interest).

2.3 The Claimant further states that "those corrections were founded on the conviction, for the Tax Administration, of the non-existence of the intra-community transactions contained in the inspected documentation, supported by the facts and events set out in the respective Report, that is":

2.3.1 "The company recipient of the goods had no physical structure nor personnel at its service that would allow it to carry out a commercial, industrial or other activity";

2.3.2 "It was not known at the address of its registered office";

2.3.3 "It was common practice for orders, among the companies that declared Intra-community Transfers of Goods (TIB) and the Spanish company, to be placed by telephone, fax from national numbers, by the same persons, with employment links with national companies that paid them dependent work income (…)";

2.3.4 "The non-existence of transport documents, despite being requested (…) is consistent with what was ascertained by the Spanish Tax Administration, that at the addresses indicated the companies identified in the invoices issued did not exist, nor were they known (…)";

2.3.5 "(…) A… (…) only received requests/orders from a single person of Portuguese nationality, who earned dependent work income from national companies (…)".

2.4 Having the Claimant "been notified of the (…) aforementioned corrections, it did not conform (…) with the arguments put forward by the Respondent, having exercised (…) the right to be heard and defence".

2.5 In fact, the Claimant continues that "all the facts described refer to transactions carried out with customer B…, ..., with registered address in (…) Pontevedra", Spain and there "registered as an intra-community operator (…) on the date of the transaction of the goods, being the holder of VAT-ES-…".

2.6 Moreover, the Claimant further states that "the Tax Administration never placed in question that such transactions were effectively carried out".

2.7 In these terms, the Claimant understands that all requirements were "(…) met for the exemption provided for in paragraph a) of art. 14 of RITI to be granted", "which, in the Claimant's view, means that the assessments resulting from the correction (…) suffer from various errors in the factual and legal assumptions, and cannot be maintained".

2.8 Firstly, the Claimant states, "because the objective evidence that was presented (…) regarding the delivery of the goods in Spain was not duly valued"[3], "having been demonstrated (…) the payment of the respective transport of goods (…) and its unloading in Spain".

2.9 The Claimant further states that "it follows from the Report drawn up (…) that the acquiring entity is a shell company, without physical facilities or its own human resources, acting with the sole purpose of simulating intra-community transactions and, thereby, evading the settlement and payment of VAT", "suspicions" which "lack foundation", because:

2.9.1 "Before the beginning of the commercial relationship that was to constitute itself" the Claimant "was careful to validate, through the Internet, the VAT number of the acquiring entity, which would naturally be associated with the legal existence of the same";

2.9.2 "(…) monthly, this company filled out and delivered the Recapitulative Statement, never having occurred, as a result of its processing, any indication of irregularity on the part of the acquirer, and this because (…) it delivered, correlatively, the respective Recapitulative Statements with the Spanish Tax Authority".

2.10 Thus, for the Claimant, its customer company "always created the appearance and certainty that it was a company that carried out its activity within a framework of normality, stability and legality (…)", with the fact that "a substantial part of the payments were made by bank transfer or cheque, from (…) an account domiciled in Spain (…)".

2.11 Wherefore, when confronted "with the inspection to which it was subject, the Claimant was careful to inquire, from the acquiring company, about the relevance of the suspicions raised by the Tax Administration" and was told that "the acquirer was registered in the competent Spanish bodies, that it had at its disposal the services and human resources indispensable to the activity (…) and that it had, over time, its registered office installed in Tui, Spain (…)".

2.12 The Claimant further reiterates that "it did not have (…) the legal obligation, nor even the means, to police its customers (…), not being it supposed to substitute itself in the execution of tasks that fall to other bodies".

2.13 Nevertheless, "following the inspection action, it took steps to obtain proof that the goods had, effectively, arrived in the neighbouring country, which it managed to achieve".

2.14 Thus, the Claimant concludes that "having the goods been sold and loaded destined for Spain to a buyer registered as an intra-community operator in the destination country, the taxable event of the exemption is verified", therefore "it is necessary to conclude that the assessments in question must be annulled in acknowledgement that the said operations, relating to the year 2010, were exempt from VAT, pursuant to paragraph a) of art. 14 of RITI" (emphasis ours).

3. RESPONDENT'S ANSWER

3.1 The Respondent, in its answer submitted, defended itself by way of objection as described below.

ON THE FACTS

3.2 The Respondent begins by clarifying that "having the Tax Inspection Services (SIT) verified that the Claimant declared that it had carried out intra-community transfers of goods, in the fiscal year 2010, to company B… (…) with registered address in Spain, and there being doubts as to the truthfulness of the operations detected, following information provided by the Spanish Tax Administration, an inspection procedure was initiated", which was carried out "under Internal Service Order no. OI2014… (…)".

3.3 Within the scope of the said inspection procedure carried out on the Claimant "the extract of the current account relating to B… (…) was requested, as well as a copy of the respective invoices, transport documents with confirmation of receipt of the goods at destination and a copy of the means of receipt", the Claimant having:

3.3.1 "Presented only a copy of the invoices issued and a copy of deposit slips as supporting documents for receipt of the invoices";

3.3.2 "Not having presented any proof of departure of the goods from national territory".

3.4 "On the other hand, having been asked of the Claimant to indicate the persons who placed orders on behalf and on account of the Spanish company, it identified only one person of Portuguese nationality, with employment links and to whom dependent work income was paid by national companies".

3.5 Thus, "having weighed all the indicia collected by the SIT, as well as the information provided by the Spanish Tax Administration, and after the exercise of the right to be heard by the Claimant, it was concluded that there was a lack of elements that would make it possible to prove, unequivocally, that the goods in question left national territory destined for Spain, therefore the inspection procedure resulted in corrections in the area of VAT in the amount of € 3,765.36, to which compensatory interest is added" (emphasis ours).

ON THE LAW

3.6 The Respondent understands that "based on the factuality described and for the reasons (…) put forward, the arguments presented by the Claimant are manifestly without merit" given that "in a misinterpretation of the applicable legal norms, it alleges that it is not necessary for the goods to actually leave national territory for the exemption to be verified (…)".

3.7 Additionally, it further states that "it always incumbent upon the (…) Claimant to demonstrate the verification of the requirements required for the purposes of the exemption enshrined in paragraph a) of no. 1 of Article 14 of RITI, which (…) the Claimant failed to do in the concrete case of the present proceedings" since, according to the Respondent "there is a manifest absence of presentation of evidence for the facts alleged by the Claimant, its considerations having no documentary support" (emphasis ours).

3.8 And, the Respondent reiterates that the Claimant "did not possess nor attached, when notified to do so, within the scope of the inspection procedure, the transport documents required and necessary to prove the actual departure of the goods from national territory".

3.9 On the other hand, "the circumstances in which such information was made available, (…) although incomplete, in that they do not relate to all invoices, only deepened the incongruities detected by the SIT".

3.10 Thus, "in view of the elements presented, the SIT concluded that (…)" the Claimant, "in the right to be heard, presented arguments that were rebutted above, and copies of documents allegedly now obtained from a Spanish entity ceased about 3 years ago, which in no way invalidate the conclusion reached by the Tax Inspection as to the physical and human non-existence of the company headquartered in Spain, and the impossibility of the goods having left Portuguese territory", therefore "(…) having regard to all the elements ascertained, it is to be inferred that it is not possible to consider as proven the departure of the goods from national territory", which "is a sine qua non condition for the verification of the exemption provided for in Article 14 of RITI, to which is added the fulfilment of other requirements" (emphasis ours).[4]

3.11 The Respondent further reiterates that "the assessments under dispute do not have as their premise the fact that the transfers did not take place but, rather, that the goods that are the subject of the transaction did not leave national territory" and "not having the Claimant proven the actual departure of the goods transacted from national territory, it could not be confirmed that we are in the presence of verification of an intra-community transfer of goods for the purposes of the regime contained in Article 14 of RITI" (emphasis ours).

3.12 Thus, the Respondent concludes that "the arguments raised by the Claimant are manifestly without merit, the assessment here disputed not being affected by error either in the factual assumptions, or in law" therefore "the (…) request for arbitral ruling should be judged without merit (…)".

ON THE WAIVER OF WITNESS EVIDENCE

3.13 In this context, the Respondent understands that "the examination of the witnesses arrayed, in the concrete case, would appear to be an unnecessary act and, as such, should not be carried out (…)" and, in consequence, "the witness evidence requested should be dismissed".

4. PROCEDURAL ORDER

4.1 The request for arbitral ruling is timely in that it was filed within the time period provided for in paragraph a) of no. 1 of Article 10 of RJAT.

4.2 The parties enjoy legal personality and capacity, are legitimate with respect to the request for arbitral ruling and are duly represented, pursuant to the provisions of Articles 4 and 10 of RJAT and Article 1 of Ordinance no. 112-A/2011, of 22 March.

4.3 The Tribunal is regularly constituted, pursuant to Article 2, no. 1, paragraph a), Articles 5 and 6, all of RJAT and is competent to hear the request for arbitral ruling formulated by the Claimant.

4.4 No exceptions were raised that require ruling.

4.5 No irregularities are found, therefore the tribunal must now proceed to hear the merits of the claim.

5. FACTUAL MATTERS

Proven Facts

5.1 The following facts are considered proven as documented below:

5.1.1 Within the scope of its activity, in 2010, the Claimant carried out commercial transactions, in the amount of EUR 18,248.32, invoiced to company B…, …, a legal entity of Spanish law, VAT no. ES-…, through the following invoices:

5.1.2 An inspection procedure was carried out on the Claimant, duly authorized with internal inspection order no. OI2014… (in accordance with a copy of the inspection report contained in the administrative file attached to the proceedings by the Respondent);

5.1.3 The above-identified service order was issued for the purpose of clarifying doubts as to the truthfulness of the intra-community transfers carried out, in 2010, between the Claimant and company B…, with registered address in Spain and holder of VAT ES-…;

5.1.4 From the inspection procedure developed with the Claimant, the tax inspection services concluded that "given (…) the non-existence of (…) elements that prove unequivocally that the goods (…) left Portugal, it is concluded that they were introduced into consumption in national territory and are, therefore, considered domestic transfers of goods, subject to tax under Article 1 of CIVA" therefore, in accordance with the analysis of those services, the tax shortfall relating to the sales of the year 2010 amounts to EUR 3,765.36 (in accordance with a copy of the inspection report contained in the administrative file attached to the proceedings by the Respondent);

5.1.5 The Claimant was notified, through Official Letter no. …/…, dated 20 October 2014, of the draft corrections to the above-identified tax inspection report to, within a period of 15 days, if it wished, exercise its right to be heard on the same;

5.1.6 The Claimant exercised its right to be heard in writing on 5 November 2014, to the effect of expressing its disagreement with the draft corrections referred to in the preceding point, inasmuch as "the taxpayer has and presents documents evidencing the transport carried out, therefore there are no doubts, not only that the same were carried out, but also that the goods left the country", therefore for the Claimant, "the conclusions of the draft corrections to the inspection report should not proceed, the inspection procedure being filed";

5.1.7 With the exercise of the right to be heard, the Claimant attached copies of 6 statements made by customer B…, within the scope of the summary maps of intra-community operations delivered in Spain (statements model 349, relating to periods 4/2009, 1/2010, 5/2010, 7/2010, 8/2010 and 10/2010);

5.1.8 Within the scope of the exercise of the right to be heard referred to in the preceding point, the Claimant attached copies of 10 statements issued by B… relating to acquisitions invoiced by the Claimant (and with dates coinciding with those of the respective invoices issued) and transported by company C…- …, Lda.;

5.1.9 Copies of the recipient's copy of 5 CMRs (no. …, no. …, no. …, no. … and no. …) relating to sales carried out by the Claimant to B… were further attached (see point 5.3.);

5.1.10 The tax inspection services maintained in the final inspection report (dated 7 November 2014) the proposed corrections (which were considered valid and ordered to be notified, by order of the Head of Division, dated 10 November 2015), in accordance with a copy of the inspection report contained in the administrative file attached to the proceedings;

5.1.11 The Claimant was notified of the corrections resulting from the inspection action through Official Letter dated 11 November 2010, sent by registered mail dated 12 November 2015 (in accordance with a copy contained in the administrative file attached to the proceedings by the Respondent);

5.1.12 A notice of initiation of the minor offence procedure no. …2014… was sent to the Head of the Financial Services Office of Guimarães …, through Official Letter no. …/…, dated 11-11-2014, initiated against the now Claimant, following the conclusions of the above-mentioned inspection report;

5.1.13 The Claimant was notified of the following VAT collection documents that are the subject of the corrections made by the tax inspection services (see point 5.1.4., above):

5.2 No other facts were proven capable of affecting the decision on the merits of the claim.

Unproven Facts

5.3 Copies of CMRs were not obtained for the invoices indicated below, therefore for the goods invoiced thereby there was, in this manner, no proof of the actual departure of the same from national territory, in accordance with the analysis carried out in the following chapter:

5.4 For invoices no. 3557 (of 07-01-2010), no. 3565 (of 13-01-2010), no. 3907 (of 15-07-2010) and no. 3953 (of 10-08-2010), from the information extracted from the documents (Invoices and CMRs) whose copies were attached to the proceedings (through the administrative file attached by the Respondent), it is verified that of the five CMRs attached (when exercising the right to be heard), signed/stamped by the seller, the carrier and the recipient, regarding one of the CMRs there is no identification of the invoice to which it relates (CMR no. …) and in the other four (CMR no. …, no. …, no. … and no. …), although there is such indication, in the fields relating to the identification of the respective goods (field 6 to 12) there is no correspondence between the identification of the goods invoiced (designation "Fabric", quantity in "metres") and the identification of the goods entered in the said CMRs (indication by "volumes", "mode of packaging" and "gross weight in Kg"), and there may also be incongruities as to the weight of the volumes (for example, 5 rolls in CMR no. … correspond to 136 kg, with indication in invoice no. 3565 of 250 metres of fabric, and 4 rolls in CMR no. … correspond to 150 kg, with indication in invoice no. 3557 of 200 metres of fabric), therefore, in view of the incoherencies recorded, the CMRs presented do not constitute proof of departure of the goods from national territory.

5.5 No evidence was obtained as to the payment of the amounts of tax and interest identified in point 5.1.13., above, without this having a direct bearing on the analysis of the merits of the claim.

5.6 No facts were verified as unproven with relevance to the arbitral award.

6. LEGAL MATTERS

6.1 The main issue to be clarified within the scope of the proceedings is whether, having the Claimant carried out sales, in 2010, to a given Spanish customer (B… SL), it complied with the requirements (of a cumulative nature) provided for in paragraph a), of Article 14 of the Regime of VAT in Intra-Community Transactions (RITI), with a view to the same being able to be duly qualified as TIB and, therefore, exempt from VAT in Portugal.

6.2 According to the Respondent, the answer to be given to this question should be negative, since (taking into account that in TIB there are formal and substantive requirements that must be fulfilled for such qualification to take effect), the Claimant did not provide proof of the "actual departure of the goods transacted from national territory", therefore "it could not be confirmed that we are in the presence of verification of an intra-community transfer of goods for the purposes of the regime contained in Article 14 of RITI", thus defending that the operations in question should be classified as domestic transfers and thus subject, and not exempt, to VAT in Portugal.

6.3 On the other hand, the Claimant understands that the Respondent's arguments are not well-founded, inasmuch as all requirements were "(…) met for the exemption provided for in paragraph a) of art. 14 of RITI to be granted", that is, "having the goods been sold and loaded destined for Spain to a buyer registered as an intra-community operator in the destination country, the taxable event of the exemption is verified", therefore "(…) the assessments in question must be annulled (…)".

6.4 In these terms, it is necessary to analyse whether or not the requirements provided for in the applicable legislation were complied with so as to determine whether the transfers carried out can or cannot be classified as being TIB and, in that measure, exempt from VAT in Portugal.

6.5 In accordance with the provisions of Article 3, no. 1, of the VAT Code "a transfer of goods is generally considered to be the onerous transfer of tangible goods in such a manner as corresponds to the exercise of the right of ownership".

6.6 Thus, in order for a transfer of goods to be qualified as such, for VAT purposes, it is necessary that such transaction be considered:

6.6.1 An onerous transfer, in the sense that only transfers carried out for onerous consideration are subject to VAT, leaving, in principle, excluded from the scope of this tax transfers carried out for free;

6.6.2 Of tangible goods, moveable or immoveable, leaving excluded from this concept the onerous transfers of intangible goods, which shall be taxed as provision of services;

6.6.3 In such manner as corresponds to the exercise of the right of ownership, that is, even though the transfer of the legal ownership of the good does not take place, it being sufficient that the transfer in question grants the acquirer the power (economic) of disposal of the goods in question, as if, in fact, he were the owner of the same.

6.7 With respect to the concept of TIB, although this does not find a legal definition in RITI, this regime defines what should be understood by intra-community acquisition of goods (AIB) being possible, from this, to construct "a contrario" the concept of TIB.

6.8 Indeed, pursuant to the provisions of Article 3 of RITI, "an acquisition of goods intra-community (AIB) is generally considered to be the obtaining of the power of disposal, in such manner as corresponds to the exercise of the right of ownership, of a tangible moveable good, whose dispatch or transport to national territory, by the seller, by the acquirer or on account of these, destined for the acquirer, has begun in another Member State".

6.9 In these terms, symmetrically, a TIB shall correspond to the transfer of the power of disposal, in such manner as corresponds to the right of ownership, of a tangible moveable good, whose dispatch or transport to the territory of another Member State, by the seller, by the acquirer or on account of these, destined for the acquirer, has begun in national territory.

6.10 Taking into account the provisions of Article 7, no. 1 of RITI, the range of operations covered by the concept of TIB would become too broad, therefore the legislator found it necessary to exclude certain types of transactions, thus proceeding, in its no. 2, to a negative delimitation of the incidence, it not being considered in this manner as TIB the transfers of goods listed there.[20] [21]

6.11 Taking into consideration the principle of taxation in the country of destination and that of neutrality of the tax, applicable to transfers of goods carried out between national taxable persons and taxable persons registered in other Member States, the main consequence of the qualification of an operation as TIB is that this (similarly to export operations) shall, in principle, be exempt in the Member State of origin (i.e., in the Member State where the dispatch or transport of the good began with destination to another Member State).[22]

6.12 However, it is not sufficient that an operation be, a priori, qualified as TIB to ensure that the same may benefit from the VAT exemption.

6.13 Indeed, in addition to it being necessary that such operation meets the legal requirements of the exemption [provided for in Article 14, paragraph a), of RITI], the transferor must be capable of evidencing the verification of these same requirements.

6.14 In fact, pursuant to the provisions of Article 14, paragraph a), of RITI, "are exempt from the tax, transfers of goods, carried out by a taxable person (…), dispatched or transported by the seller, by the acquirer or on account of these, from national territory to another Member State destined for the acquirer, when this is a natural or legal person registered for VAT purposes in another Member State, who has used the respective identification number to carry out the acquisition and is there covered by a regime of taxation of intra-community acquisitions of goods" (emphasis ours).

6.15 Thus, in accordance with the article transcribed, the VAT exemption mentioned depends on the verification, cumulatively, of three conditions:

6.15.1 To be a transfer of goods between a VAT taxable person in Portugal and a taxable person for VAT purposes in another Member State;

6.15.2 The transfer of goods is destined for the acquirer, taxable person in the other Member State, with the dispatch of the good from Portugal to that Member State taking place;

6.15.3 The acquirer of the goods in the other Member State has used the respective identification number to carry out the acquisition and is there covered by the regime of taxation of intra-community acquisitions of goods.

6.16 In this manner, the exemption of an intra-community transfer of goods only takes place if, in addition to the conditions imposed with respect to the acquirer, the physical departure of the goods from national territory occurs, as follows from the expression "(…) from national territory to another Member State destined for the acquirer (…)", a determining condition in the qualification of the intra-community nature of a transfer.

6.17 In this context, it should be noted that the concept of dispatch contained in this legal rule was not defined in the Sixth Directive (Council Directive 77/388/EEC of 17 May 1977), is not found in Directive 2006/112/EC of the Council, of 28 November (which reformed the Sixth Directive), and is thus not defined in the VAT Code in which there is, however, a reference, with respect to the determination of the taxable event, in Article 12, no. 1, of RITI (to Article 7 of the VAT Code), in which the notion of "putting the goods at the disposal of the acquirer" is employed.[23]

6.18 Nevertheless, the said concept presupposes the physical relocation of goods from one Member State to another, a condition that establishes the difference between an intra-community operation and one that is carried out within a Member State, because only thus is it possible to apply the principle of attribution of fiscal revenue to the Member State where final consumption occurs, that is, the principle of taxation at destination, applicable to intra-community trade.

6.19 Additionally, it should further be noted that, in accordance with the provisions of Article 1, no. 2, paragraph e), of the VAT Code, intra-community transport of goods is understood as the transport of goods whose places of departure and arrival are situated in the territory of different Member States, the place of departure being that where the transport effectively begins [not being considered the journeys made to reach the place where the goods are located (Article 1, no. 2, paragraph f), of the VAT Code)] and understanding by place of arrival the place where the transport of the goods effectively terminates [Article 1, no. 2, paragraph g), of the VAT Code].

6.20 Still on this matter, it is important to stress that, pursuant to the provisions of Article 1, no. 5, of the VAT Code, any transport of goods whose places of departure and arrival are situated in national territory or within another Member State is equated to an intra-community transport of goods, always provided such transport is directly connected to an intra-community transport of the same goods.

6.21 With regard to the requirement that the goods be sent "destined for the acquirer", this places emphasis on the place of arrival, that is, the place where the transport of the goods effectively terminates [as provided for in Article 1, no. 2, paragraph g), of the VAT Code], which must coincide with the location of the acquirer mentioned in the invoice (pursuant to the provisions of Article 27, no. 5, of RITI).

6.22 Another of the essential conditions for the qualification of an operation as TIB is that the acquirer be an entity registered, for VAT purposes, in the Member State of destination, as referred to in point 6.15.3., above.

6.23 For the purposes of the above, the transferor should collect, at a time prior to the consummation of the sale of the goods, the information necessary that allows it to confirm that the registration of the acquirer, for VAT purposes, is in effect, by requesting its VAT identification number.[24]

6.24 It is thus necessary that the acquirer be covered by a regime of taxation of intra-community acquisitions of goods, a regime which is intended to ensure that the AIB will be taxed in the Member State of destination.[25]

6.25 Nevertheless, to ensure that the TIB will be considered an operation exempt, pursuant to the provisions of RITI, it is not sufficient that such operation be, in the abstract, qualified as TIB, it shall also be necessary that the seller be capable of proving that the requirements for applicability of the exemption were met in the concrete case.

6.26 Thus, the demonstration that there was a transfer of goods and that such goods were dispatched or transported from national territory by the seller, by the acquirer or on their account, destined for another Member State assumes high importance, since correct non-assessment of tax depends on this, as well as the deduction of tax borne upstream by the transferor.

6.27 It should further be noted that, taking into account that Article 4, no. 1, of the VAT Code considers (on a residual basis), as provision of services the operations carried out for onerous consideration that do not constitute transfers, intra-community acquisitions or imports of goods, in order for the exemption of TIB to operate it is necessary that the transferor, from the outset, have elements that can support the qualification of the operation as a transfer of goods.[26]

6.28 Since the concept of transfer of goods for VAT purposes rests on the transaction of the tangible thing in such manner as corresponds to the exercise of the right of ownership, the proof of the legal title of transfer of ownership (e.g., the document that evidences the contract of sale and purchase), may appear insufficient, it also being necessary to prove that the economic power of disposal of the good (which, normally, coincides with its possession) has been transferred from the sphere of the seller to the sphere of the acquirer.

6.29 Thus, the proof of the verification of the conditions referred to in Article 14, paragraph a) of RITI, with a view to the application of the exemption there provided, incumbent upon the taxable person seller, who must be capable of proving all elements required in that article, namely the transport of goods to another Member State, under penalty of the operation being considered located in national territory and as such internally subject to tax.

6.30 Although in RITI there is no rule similar to that laid down in no. 8, of Article 29 of the VAT Code (which imposes the obligation to prove certain exemptions referred to in Article 14 of that Code), it is implicit in Article 14 of RITI that the transaction will only be exempt if the goods physically leave national territory destined for another Member State.

6.31 "Thus, faced with the lack of a rule in VAT legislation indicating which means of proof are considered appropriate to prove the verification of the requirements of the exemption provided for in paragraph a) of Article 14 of RITI, it seems to be admissible that such proof can be effected by resorting to the general alternative means of proof, an understanding which appears to be in accordance with the administrative doctrine that, on this matter (…)", has been divulged by the Tax Authority.[27]

6.32 Thus, within the scope of proving the requirements of the exemption provided for in the above-mentioned article, no. 4 of Circular Letter no. 30009, dated 10 February 1999, establishes that for the purposes of "(…) proving the verification of the requirements of the exemption (…) it should be admitted that proof of the departure of the goods from national territory can be effected (…) namely through the following alternative possibilities":[28]

6.32.1 "Transport documents evidencing the transport, which, depending on whether it is road, air or maritime, may be, respectively, the declaration of shipment (CMR), the bill of lading (AWB) or the bill of lading (B/L)";

6.32.2 "Transport contracts entered into";

6.32.3 "Invoices from transport companies";

6.32.4 "Remittance slips";

6.32.5 "The declaration, in the Member State of destination of the goods, by the respective acquirer, of having carried out there the corresponding intra-community acquisition".

6.33 With respect to the time period referenced in the legal rules, within the scope of intra-community transfers of goods, it is expressly associated with the issuance of the invoice, as provided for in no. 2, of Article 27 of RITI, the legislator having established no time requirement with respect to proof of the requirement of the exemption - departure of the goods from the Member State of origin.[29]

6.34 With respect to TIBs in which the transport of the goods is carried out by the acquirer or on account of this, specific problems may arise with respect to proof of transport or dispatch.[30]

6.35 On this matter, as referred to in the Commission Report (on the functioning of the transitional regime of VAT), whenever the buyer takes upon itself the transport by its own means, the seller cannot accept solely the simple indication that the goods will effectively be transported destined for another Member State.

6.36 Indeed, a transport slip or an equivalent document presented when withdrawing the goods or even a formal commitment subscribed to by the buyer, do not establish the reality of the transport, therefore, in these conditions, suppliers often express the fear of seeing their responsibility called into question and the exemption of the transfer rejected upon the occasion of an inspection.

6.37 In view of this problem, it seems to be a settled understanding of the Respondent that the question can be overcome, for which purpose, the supplier should request from the acquirer of the goods, a statement in which the latter certifies that the transport will be carried out by it and what the destination of the goods is, or any other document that it considers appropriate for this purpose.

6.38 In this context, as referred to in the Judgment Euro Tyre Holding BV (C-430/09, of 16 December 2010), with respect to the condition relating to proof, in that it constitutes one of the conditions of the exemption, it is important to note that even though it incumbent upon the supplier to demonstrate that the good was dispatched or transported to another Member State, in circumstances in which the right of disposal of the good as owner is transferred to the acquirer in the territory of the Member State of delivery (and in which it falls to this acquirer to dispatch or transport the good outside the Member State of delivery), the proof that the supplier can present to the tax authorities depends essentially on the elements it receives from the acquirer for this purpose.[31]

6.39 Thus, when the good that is the subject of transfer is not dispatched or transported to another Member State by the supplier, but by the acquirer or a third party on account of this, in circumstances in which the right of disposal of the good as owner is transferred to the acquirer in the Member State of delivery and it falls to the latter to dispatch or transport the good outside that Member State, the supplier must ensure that the elements it holds, received from the acquirer, are sufficient to prove its intervention in an intra-community transfer.

6.40 On the other hand, the indication of the tax identification number/VAT number is a fundamental element in transactions carried out between taxable persons of different Member States allowing, within the scope of the VIES system, to make known to the tax administration of the destination country of the goods the value of intra-community acquisitions subject to taxation and the identification of the acquirers registered there for VAT purposes.[32]

6.41 Taking into account that the concept of taxable person of intra-community acquisitions does not coincide with the concept of taxable person for VAT in transfers of goods and provision of services, it would not suffice to impose the condition of registration for this tax, it being necessary (in order to ensure that non-taxation in the country of origin corresponds to taxation in the country of destination of the goods) that the acquirer be covered by a regime of taxation of intra-community acquisitions.

6.42 In order to ensure that the quality of the acquirer of the TIB will not hinder the qualification of the operation as exempt, the transferor should (i) obtain the tax identification number/VAT number of the acquirer, (ii) certify that the said no. belongs to the country of origin of the acquirer and (iii) proceed to the validation of the number in the VIES system, proving that the acquirer is a VAT taxable person.[33]

6.43 Without prejudice to other general ancillary obligations, provided for in no. 1 of Article 29 of the VAT Code, taxable persons carrying out TIB must:

6.43.1 Mandatorily issue an invoice for each TIB carried out which, in addition to the elements provided for in Article 36, no. 5, of the VAT Code, must contain (i) the tax identification number of the taxable person, preceded by the prefix 'PT' and the VAT identification number of the recipient or acquirer, which must include the prefix of the Member State that assigned it, (ii) as well as the place of destination of the goods [Articles 23, no. 1, paragraph b), and 27, no. 5, of RITI];[34]

6.43.2 Send a summary statement of the transfers of goods exempt under Article 14 of RITI [Article 23, no. 1, paragraph c), of RITI);

6.43.3 Submit the statistical information of the operations through Intrastat.

6.44 In summary, it follows from the above that TIBs benefit from exemption if:

6.44.1 The goods are dispatched or transported from national territory to the destination Member State; and

6.44.2 In the Member State of destination, the acquirer (i) is a taxable person for the tax [not relevant for this purpose being its nature (natural or legal person)], (ii) has used the VAT identification number to carry out the acquisition and (iii) is covered by a regime of taxation of intra-community acquisitions of goods.

6.45 In practical terms, in order for the exemption not to be called into question, it will be necessary to cross-reference information from the various required documents, it thus falling to the transferor to choose the method most apt to support the exemption.

6.46 However, under penalty of violation of the principle of proportionality, the tax administrations are not entitled to overburden the burden of proof incumbent upon the taxable persons carrying out TIB, in the sense that it is not reasonable to expect that the transferor produce more proof than that which he reasonably has at his disposal within the scope of a commercial transaction and is required by the applicable legislation.[35]

6.47 With respect to the burden of proof, let us cite the Judgment of the Central Administrative Court South, handed down within the scope of case no. 04132/10, of 29 March 2011, to the effect that "it falls upon the Tax Authority to provide proof to disregard the elements declared by the taxpayers in their respective income declarations, regularly and within the respective deadline delivered, taking into account the presumption of veracity and good faith of the same, and it falls upon the taxpayer to rebut the indicia or facts which it has collected and on which it bases the respective assessment".

6.48 In the case under analysis, the Respondent supported the corrections made as a consequence of the inspection (carried out on the basis of suspicions as to the truthfulness of the operations carried out) on conclusions described in the inspection report, above already identified (point 5.1.4. and point 5.1.10., above), pursuant to which it is referred that:

6.48.1 "The company recipient of the goods had no physical structure nor personnel at its service that would allow it to carry out a commercial, industrial or other activity";

6.48.2 "It was not known at the address of its registered office";

6.48.3 "It was common practice for orders, among companies that declared (…) TIB and the Spanish company, to be placed by telephone, fax from national numbers, by the same persons, with employment links with national companies that paid them dependent work income (…)". These situations coupled with others referred to (…) are by themselves sufficient to call into question the departure of goods from national territory";

6.48.4 "The non-existence of transport documents, despite being requested (…) is consistent with what was ascertained by the Spanish Tax Administration, that at the addresses indicated the companies identified in the invoices issued did not exist, nor were they known (…)";

6.48.5 "The doubt raised by the processing of the order, that is, A… (…) only received requests/orders from a single person of Portuguese nationality, who earned dependent work income from national companies, and was never contacted by other persons with links to those Spanish companies".

6.49 Now, although all information collected by the National Tax Authority, via direct inspection or under transnational cooperation instruments, may point to various incongruities, it has not been demonstrated that these same are entirely attributable to the acquirer, inasmuch as this was obligated to comply, for the purposes of application of the exemption provided for in Article 14, paragraph a) of RITI only with the requirements provided therein and already listed in point 6.15., above.

6.50 Indeed, it has not been entirely demonstrated that, in the case under analysis, the Claimant knew, or should have known, of the alleged incongruities existing in the acquiring company of the goods (B…) which, ultimately, would place at risk the application of the VAT exemption associated with the operations that it qualified, in 2010, as TIB.

6.51 And, as to the proof that the taxable person should have provided for the purposes of benefiting from the VAT exemption, it falls to the Member States to establish (in conformity with the provisions of Article 131° of Council Directive 2006/112/EC, of 28 November) the conditions under which they exempt intra-community deliveries to ensure the correct and simple application of the said exemptions and prevent possible fraud, evasion and abuses.[36]

6.52 Nevertheless, in the exercise of its powers, the Member States must respect the general principles of law which form part of the legal order of the European Union, among which are notably the principles of legal certainty and proportionality.

6.53 On the other hand, although the Claimant, as the Respondent alleges, did not negotiate directly with B… (acquirer of the goods), since it "received requests/orders from a single person of Portuguese nationality, who earned dependent work income from national companies" and was never "contacted by other persons with links to that Spanish company", such in no way affects the normality of the transactions, since, in fact, it is perfectly acceptable that an economic operator use third parties (intermediaries, agents, etc...) with a view to having the same negotiate, in its name, certain purchases, the relationship between that operator (acquirer of the goods) and the third parties not being the responsibility of the supplier of the goods.

6.54 On the other hand, the requirements above stated in no way are prejudiced when it is the acquirer that contracts and pays the companies that carry out the transport of the goods, from Portugal to another EU Member State (in the case under analysis, Spain).

6.55 The same reasoning shall apply to cases in which payments for the goods are made through deposits (in the bank accounts of the Claimant) and not through cheque, bank transfer or other means that unequivocally identify the payer.[37]

6.56 Notwithstanding the above regarding the analysis of the requirements determining the applicability of the exemption, provided for in Article 14, paragraph a) of RITI, to transfers of goods so that these qualify, for VAT purposes, as TIB and, in that measure exempt from this tax in the Member State of origin and of dispatch of the goods, it has been verified that as to the demonstration of the actual departure of the goods from national territory (dispatch of the goods from Portugal to Spain), in view of the documents (CMRs) whose copies were made available through the administrative file attached to the proceedings by the Respondent, the Claimant failed to demonstrate such dispatch, as described above in points 5.3. and 5.4., above.

6.57 In these terms, in light of the above, not having the Claimant presented the means of proof necessary to prove the actual departure of the goods from national territory destined for another Member State (Spain), the answer to be given to the question formulated above in point 6.1. shall be in the negative, to the effect that the Claimant did not comply with all of the requirements (of a cumulative nature) provided for in paragraph a), of Article 14 of RITI (and listed in point 6.15., above), therefore the transfers of goods carried out for customer B…, in 2010 (described in point 5.1.1., above), cannot be considered exempt from VAT, and should instead be treated as internal operations, for VAT purposes, being therefore valid the assessments of tax and interest that are the subject of the request for arbitral ruling.

On Responsibility for Payment of Arbitration Costs

6.58 Pursuant to the provisions of Article 527, no. 1 of the CPC in effect (ex vi 29, no. 1, paragraph e) of RJAT), it should be established that the Party that has given cause to costs shall be condemned thereto or, there being no success of the action, whoever from the proceedings derived benefit.

6.59 In this context, no. 2 of the said article specifies the expression "has given cause", in accordance with the principle of causal connection, understanding that the losing party gives cause to process costs, in the proportion in which it is so.

6.60 In these terms, in light of the above, from the analysis carried out it results that responsibility for arbitration costs should be imputed to the Claimant.

7. DECISION

7.1 In accordance with the provisions of Article 22, no. 4, of RJAT, "in the arbitral award handed down by the arbitral tribunal there is set out the amount and the apportionment among the parties of the costs directly arising from the arbitration proceedings".

7.2 In the case under analysis, taking into account the above, the principle of proportionality imposes that full responsibility for costs be attributed to the Claimant.

7.3 In these terms, taking into account the analysis carried out, this Arbitral Tribunal has decided:

7.3.1 To judge the request for arbitral ruling presented by the Claimant without merit, the VAT assessments that are the subject of the request being maintained;

7.3.2 To condemn the Claimant to payment of the costs of the present proceedings.

Value of the case: In accordance with the provisions of Articles 306, no. 2 of the CPC, Article 97-A, no. 1 of the Code of Tax Procedure and Process (CPPT) and Article 3, no. 2 of the Regulations on Costs in Tax Arbitration Proceedings the case is valued at EUR 4,397.77.

Pursuant to the provisions of Table I of the Regulations on Costs of Tax Arbitration Proceedings, the value of the costs of the Arbitration Proceeding is fixed at EUR 612.00, charged to the Claimant, in accordance with Article 22, no. 4 of RJAT.

Let it be notified.

Lisbon, 29 October 2015

The Arbitrator

Sílvia Oliveira

[1] The writing of this award is governed by the spelling prior to the Orthographic Agreement of 1990, except for transcriptions made.

[2] These assessments are for Value Added Tax (VAT), relating to the year 2010, in the amount of EUR 4,397.77.

[3] In this context, the Claimant states that it made available "documents relating to each operation, namely invoices, CMRs and identification of the transport company".

[4] In this context, the Respondent cites the jurisprudence of the Supreme Administrative Court, namely Judgment no. 01680/03, of 29 April 2004, pursuant to which it is referred that "having carried out an intra-community transaction that benefits from exemption, it fell upon the appellant to prove the existence of the tax facts that it alleged as the basis for its right, that is, the existence of the alleged intra-community transfer" (emphasis ours).

[5] For this invoice, receipt no. 1405, dated 08-01-2010, was issued to customer B…, in the amount of EUR 664.30 (partial payment).

[6] For this invoice, receipt no. 1419, dated 21-01-2010, was issued to customer B…, in the amount of EUR 864.50.

[7] For this invoice, receipt no. 1476, dated 21-04-2010, was issued to customer B…, in the amount of EUR 1,091.27 (evidence of payment having been made by cheque no. …, without evidence of account holder).

[8] For this invoice, credit note no. 47, dated 29-04-2010, was issued to customer B…, in the amount of EUR 7.28 (the date mentioned in the CN relating to invoice 3766 is 26-01-2010 and not 26-04-2010, as stated in the respective invoice).

[9] For this invoice, receipt no. 1485, dated 29-04-2010, was issued to customer B…, in the amount of EUR 364.00.

[10] For this invoice, receipt no. 1551, dated 22-07-2010, was issued to customer B…, in the amount of EUR 5,483.30.

[11] For this invoice, receipt no. 1545, dated 15-07-2010, was issued to customer B…, in the amount of EUR 747.60.

[12] For this invoice, receipt no. 1571, dated 02-09-2010, was issued to customer B…, in the amount of EUR 790.05.

[13] For this invoice, receipt no. 1571, dated 02-09-2010, was issued to customer B…, in the amount of EUR 209.95 (partial payment).

[14] For this invoice, receipt no. 1577, dated 09-09-2010, was also issued to customer B…, in the amount of EUR 2,337.35 (remaining payment).

[15] For this invoice, receipt no. 1608, dated 14-10-2010, was issued to customer B…, in the amount of EUR 1,000.00 (partial payment).

[16] For this invoice, receipt no. 1622, dated 02-11-2010, was also issued to customer B…, in the amount of EUR 2,423.95.

[17] For this invoice, receipt no. 1636, dated 23-11-2010, was issued to customer B…, in the amount of EUR 2,208.35.

[18] As per the total amount charged to account 2111, customer B… (…), a copy of which was made available in the administrative file. However, in the inspection report, the total value of the invoices that form the basis of VAT assessment amounts to EUR 18,340.94, since invoice no. 3565 is indicated at the value of EUR 964.50 (its actual value is EUR 864.50), invoice no. 3766 is already indicated with deduction of credit note no. 47 and invoice no. 3907 is indicated at the value of EUR 747.50 (its actual value is EUR 747.60).

[19] Of this amount, EUR 3,765.36 correspond to tax and EUR 632.41 to compensatory interest.

[20] The provision of Article 7 of RITI (operations assimilated to transfers of goods for onerous consideration) assumes special importance in the delimitation of operations qualifiable as TIB insofar as, on the one hand, it assimilates other operations to the concept of intra-community transfer of goods and, on the other, proceeds to a negative delimitation of some operations not falling within the concept.

[21] These situations constitute simple movements of goods which do not give rise to TIB, and may, in some cases, give rise to taxation as domestic transfers of goods or as provision of services.

[22] Although it grants to the transferor the right to deduct VAT borne upstream for its carrying out, thus avoiding the double taxation of an operation which, from the economic viewpoint, constitutes a whole, and ensuring the neutrality of the tax.

[23] However, the Court of Justice of the European Union (CJEU) understood in the context of the Teleos case (C-409/04), as per Judgment of 27 September 2007, that the concept of dispatch should be interpreted to the effect that an intra-community acquisition of a good only takes place and the exemption of intra-community delivery is only applicable when (i) the right of disposal of the good as owner has been transferred to the acquirer, (ii) the supplier proves that such good was dispatched or transported to another Member State and that, as a consequence of such dispatch or transport, the same physically left the territory of the Member State of delivery.

[24] Should the acquirer fail to provide the said number and the transferor cannot obtain it by other means, the latter should presume that the entity is not registered, assessing the owed tax, since the TIB in question does not meet all conditions to be exempt. However, it may sometimes occur that the acquirer be registered, for VAT purposes, in more than one Member State and, in this case, the transferor should certify that the VAT number provided by the acquirer belongs to the Member State of destination of the TIB.

[25] Note that, in the case of the acquiring entity being covered by a subjective exemption from the tax (e.g., in the case of being a public law entity acting in the exercise of its powers of authority), the TIB will not be exempt, the transferor being obligated to assess the respective VAT.

[26] In that measure, and since the concepts of transfer of goods and provision of services for VAT purposes do not necessarily coincide with civil concepts, it is necessary to guard against the risk of an operation being able to be qualified as provision of services, in which case the exemption would cease to operate.

[27] On this matter see Binding Information issued within the scope of case no. …, of 29 September 2011.

[28] In this context, it should be noted that the CJEU has already held it to be admissible, for this purpose, any means of proof considered appropriate, in addition to the presentation of the respective transport document, a position which the Tax Authority has also enshrined within the scope of Circular Letter no. 30009, of 10 February 2009, above already referred to (emphasis ours).

[29] The CJEU, in the Judgment of 27 September 2007, case Albert Collée (C-146/05), understood that Article 28 C, A, paragraph a), first paragraph of the Sixth Directive (77/388/CEE of the Council, of 17 May 1977), "should be interpreted to the effect that it precludes the Tax Administration of a Member State from refusing to exempt from value added tax an intra-community delivery which effectively took place, on the sole ground that proof of this delivery was not produced in a timely manner" (emphasis ours).

[30] Relevant here are situations in which, e.g., the acquirer carries out the withdrawal of the goods directly from the establishment of the supplier, with its own transport means or by engaging a third party for this purpose, transfers of goods under the Incoterms FOB ("free on board") and FOT ("free on truck") and, among others, cases in which the goods, after having left the premises of the supplier, are transported to a logistics platform located in the same territory, departing later to the Member State of destination without the supplier having the possibility of confirming its departure from national territory and arrival in destination territory (the so-called "takeaway" transactions).

[31] However, still in accordance with the said Judgment, after the supplier has complied with its declarative obligations relating to proof of an intra-community delivery, and the contractual obligation of dispatch or transport of goods outside the Member State of delivery has not been complied with by the acquirer, it is the latter that should be considered the debtor of the VAT in that Member State (emphasis ours).

[32] The VIES (VAT Information Exchange System) consists of an electronic means of transmission of information relating to the registration of VAT of companies registered in the EU. Taxable persons may obtain confirmation of the validity of a VAT number of a taxable person of another Member State through that system, it being advisable to archive proof of verification of the validity of the number. Moreover, information relating to TIBs is also transmitted through the VIES system between the administrations of the Member States.

[33] Note that, being VIES a system updated by the tax administrations of each Member State, it records from time to time errors and omissions which may cause some valid operators to appear as invalid in the system and vice versa.

[34] Invoices must be issued at the latest by the 15th day of the month following that in which the goods were placed at the disposal of the acquirer, by the total value of the transfers of goods, even where payments to the taxable person have been made prior to the date of transfer of the goods (Article 27, nos. 2 and 3, of RITI).

[35] In this context, let us cite the Judgment VSTR (C-587/10) in which the CJEU understood that Article 28°-C, A, paragraph a), first paragraph, of Council Directive 77/388/CEE, of 17 May 1977, should be interpreted to the effect that it does not preclude the Tax Administration of a Member State from making the exemption of Value Added Tax of an intra-community delivery dependent on the transmission, by the supplier, of the VAT identification number of the acquirer, provided that the refusal to grant this exemption is not based solely on the circumstance that this obligation was not complied with where the supplier cannot, in good faith (and having taken all measures that can reasonably be required of it), transmit that identification number and transmits, on the other hand, indications capable of demonstrating sufficiently that the acquirer is a taxable person acting as such in the operation in question.

[36] The CJEU, through the Judgment Mecsek-Gabona Kft (C-273/11), understood that in a context of fraudulent operations, Article 138°, no. 1 of the said Directive 2006/112/EC should be interpreted to the effect that it does not preclude the right to exemption of an intra-community delivery from being refused to the seller, should it be concluded, in light of objective elements, that this has not complied with the obligations incumbent upon it as to proof, or that it knew or should have known that the operation it carried out was implicated in fraud committed by the acquirer and that it had not taken all reasonable measures at its disposal to prevent its own participation in this fraud (emphasis ours).

[37] Without prejudice to such conduct being able to constitute the breach of the provisions of no. 3, of Article 63-C of the General Tax Law (LGT), where applicable, an infraction subject to sanction (at most), as a minor offence in accordance with the provisions of Article 129, no. 3 of the General Regime of Tax Infractions (RGIT), but being irrelevant to the qualification of an operation as a TIB exempt, pursuant to the provisions of Article 14 of RITI.