(Reference for a preliminary ruling from the Vestre Landsret)

(Sixth VAT Directive – Article 13B(b) – Exemptions – Leasing of immovable property – Letting of premises and sites for parking vehicles – Mooring berths for boats – Land storage sites for boats)

Opinion of Advocate General Kokott delivered on 14 October 2004

Judgment of the Court (Third Chamber), 3 March 2005

Summary of the Judgment

(Council Directive 77/388, Art. 13B(b))

(Council Directive 77/388, Art. 13B(b), point 2)

As regards, more particularly, the former, a mooring berth in a port basin fulfils the definition of immovable property within the meaning of the provision concerned, since the letting does not concern a particular quantity of water, but a specific part of the port basin which is clearly delimited and cannot be moved.

(see paras 34-36, operative part 1)

(see paras 44, 46-47, operative part 2)

JUDGMENT OF THE COURT (Third Chamber) 3 March 2005 (1)

(Sixth VAT Directive – Article 13B(b) – Exemptions – Leasing of immovable property – Letting of premises and sites for parking vehicles – Mooring berths for boats – Land storage sites for boats)

In Case C-428/02, REFERENCE for a preliminary ruling under Article 234 EC from the Vestre Landsret (Denmark), made by order of 15 November 2002, received at the Court on 26 November 2002, in the proceedings

Fonden Marselisborg Lystbådehavn,

THE COURT (Third Chamber),

composed of A. Rosas, President of the Chambre, A. Borg Barthet, J.‑P. Puissochet, J. Malenovský and U. Lõhmus (Rapporteur), Judges,

Advocate General: J. Kokott, Registrar: H. von Holstein, Deputy Registrar,

having regard to the written proceedings and further to the hearing on 23 September 2004, after considering the observations submitted on behalf of:

– Fonden Marselisborg Lystbådehavn, by L. Henriksen and M. Andersen, advokaterne,

– the Skatteministeriet and the Danish Government, by J. Molde, acting as Agent, and P. Biering, advokat,

– the Greek Government, by M. Apessos and K. Georgiadis, acting as Agents,

– the Commission of the European Communities, by E. Traversa and T. Fich, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 14 October 2004,

gives the following

This reference for a preliminary ruling concerns the interpretation of Article 13B(b) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes – Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1), as amended by Directive 92/111/EEC of 14 December 1992 (OJ 1992 L 384, p. 47, ‘the Sixth Directive’).

That reference was made in the course of two sets of proceedings between Fonden Marselisborg Lystbådehavn (the Marselisborg Pleasure Boat Port Trust, ‘FML’) and the Skatteministeriet (Ministry of Fiscal Affairs) and the latter against FML concerning value added tax (‘VAT’) on the letting of mooring berths for boats in a pleasure boat port complex and of storage sites for housing pleasure boats during the winter.

Legal background

Community law

Directive 2011/92

Recitals 7 to 9 of Directive 2011/92 state:

‘(7) Development consent for public and private projects which are likely to have significant effects on the environment should be granted only after an assessment of the likely significant environmental effects of those projects has been carried out. …

(8) Projects belonging to certain types have significant effects on the environment and those projects should, as a rule, be subject to a systematic assessment.

(9) Projects of other types may not have significant effects on the environment in every case and those projects should be assessed where the Member States consider that they are likely to have significant effects on the environment.’

Article 2(1) of that directive provides:

‘Member States shall adopt all measures necessary to ensure that, before development consent is given, projects likely to have significant effects on the environment by virtue, inter alia, of their nature, size or location are made subject to a requirement for development consent and an assessment with regard to their effects on the environment. Those projects are defined in Article 4.’

Under Article 3(1) of that directive:

‘The environmental impact assessment shall identify, describe and assess in an appropriate manner, in the light of each individual case, the direct and indirect significant effects of a project on the following factors:

…

(b) biodiversity, with particular attention to species and habitats protected under [Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora (OJ 1992 L 206, p. 7), as amended by Council Directive 2013/17/EU of 13 May 2013 (OJ 2013 L 158, p. 193) (“Directive 92/43”)] and Directive 2009/147/EC [of the European Parliament and of the Council of 30 November 2009 on the conservation of wild birds (OJ 2010 L 20, p. 7)];

…’

Article 4 of Directive 2011/92 provides:

‘1. Subject to Article 2(4), projects listed in Annex I shall be made subject to an assessment in accordance with Articles 5 to 10.

(a) a case-by-case examination;

(b) thresholds or criteria set by the Member State.

Member States may decide to apply both procedures referred to in points (a) and (b).

Where a case-by-case examination is carried out or thresholds or criteria are set for the purpose of paragraph 2, the relevant selection criteria set out in Annex III shall be taken into account. Member States may set thresholds or criteria to determine when projects need not undergo either the determination under paragraphs 4 and 5 or an environmental impact assessment, and/or thresholds or criteria to determine when projects shall in any case be made subject to an environmental impact assessment without undergoing a determination set out under paragraphs 4 and 5.

Where Member States decide to require a determination for projects listed in Annex II, the developer shall provide information on the characteristics of the project and its likely significant effects on the environment. The detailed list of information to be provided is specified in Annex IIA. The developer shall take into account, where relevant, the available results of other relevant assessments of the effects on the environment carried out pursuant to Union legislation other than this Directive. The developer may also provide a description of any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.

The competent authority shall make its determination, on the basis of the information provided by the developer in accordance with paragraph 4 taking into account, where relevant, the results of preliminary verifications or assessments of the effects on the environment carried out pursuant to Union legislation other than this Directive. The determination shall made available to the public and:

(a) where it is decided that an environmental impact assessment is required, state the main reasons for requiring such assessment with reference to the relevant criteria listed in Annex III; or

(b) where it is decided that an environmental impact assessment is not required, state the main reasons for not requiring such assessment with reference to the relevant criteria listed in Annex III, and, where proposed by the developer, state any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.

Member States shall ensure that the competent authority makes its determination as soon as possible and within a period of time not exceeding 90 days from the date on which the developer has submitted all the information required pursuant to paragraph 4. In exceptional cases, for instance relating to the nature, complexity, location or size of the project, the competent authority may extend that deadline to make its determination; in that event, the competent authority shall inform the developer in writing of the reasons justifying the extension and of the date when its determination is expected.’

Annex II.A of that directive contains the list of ‘information to be provided by the developer on the projects listed in Annex II’. That list reads as follows:

‘1. A description of the project, including in particular:

(a) a description of the physical characteristics of the whole project and, where relevant, of demolition works;

(b) a description of the location of the project, with particular regard to the environmental sensitivity of geographical areas likely to be affected.

(a) the expected residues and emissions and the production of waste, where relevant;

(b) the use of natural resources, in particular soil, land, water and biodiversity.

Annex III to that directive sets out the ‘criteria to determine whether the projects listed in Annex II should be subject to an environmental impact assessment’.

Directive 2014/52

Recitals 11 and 29 of Directive 2014/52 state:

‘(11) The measures taken to avoid, prevent, reduce and, if possible, offset significant adverse effects on the environment, in particular on species and habitats protected under [Directive 92/43] and Directive 2009/147 …, should contribute to avoiding any deterioration in the quality of the environment and any net loss of biodiversity, in accordance with the [European] Union’s commitments in the context of the [United Nations Convention on Biological Diversity, signed in Rio de Janeiro on 5 June 1992,] and the objectives and actions of the Union Biodiversity Strategy up to 2020 laid down in the [Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions] of 3 May 2011 entitled ‘Our life insurance, our natural capital: an EU biodiversity strategy to 2020’ [(COM(2011) 244 final)]

…

(29) When determining whether significant effects on the environment are likely to be caused by a project, the competent authorities should identify the most relevant criteria to be considered and should take into account information that could be available following other assessments required by Union legislation in order to apply the screening procedure effectively and transparently. In this regard, it is appropriate to specify the content of the screening determination, in particular where no environmental impact assessment is required. Moreover, taking into account unsolicited comments that might have been received from other sources, such as members of the public or public authorities, even though no formal consultation is required at the screening stage, constitutes good administrative practice.’

Directive 92/43

Article 6(3) of Directive 92/43 provides:

‘Any plan or project not directly connected with or necessary to the management of the site but likely to have a significant effect thereon, either individually or in combination with other plans or projects, shall be subject to appropriate assessment of its implications for the site in view of the site’s conservation objectives. In the light of the conclusions of the assessment of the implications for the site and subject to the provisions of paragraph 4, the competent national authorities shall agree to the plan or project only after having ascertained that it will not adversely affect the integrity of the site concerned and, if appropriate, after having obtained the opinion of the general public.’

Article 12(1) of that directive provides:

‘Member States shall take the requisite measures to establish a system of strict protection for the animal species listed in Annex IV(a) in their natural range, prohibiting:

(a) all forms of deliberate capture or killing of specimens of these species in the wild;

(b) deliberate disturbance of these species, particularly during the period of breeding, rearing, hibernation and migration;

(c) deliberate destruction or taking of eggs from the wild;

(d) deterioration or destruction of breeding sites or resting places.’

Point (a) of Annex IV to that directive mentions ‘all species’ of bats belonging to the suborder of ‘microchiroptera’.

Irish law

The dispute in the main proceedings results from the fact that, following an inquiry in 1999 by FML to the Regional Tax Authority, Århus (Denmark), the latter took the view that the income from letting mooring berths was subject to VAT. FML contested that decision before the Landsskatteret (Denmark).

In its order of 6 December 2000, the Landsskatteret held that the letting of water-based mooring berths could not benefit from the VAT exemption provided for by Article 13(1), point 8, of the Momsloven, on the ground that that activity could not be regarded as a letting of immovable property. It held that a boat owner does not rent a specific and identifiable area or parts of immovable property but merely acquires a right of use, which consists of having a mooring berth for his boat in the port.

On the other hand, as regards winter storage of boats, the Landsskatteret held that that activity is not subject to VAT because it may be treated as a ‘letting of immovable property’ for the purposes of Article 13(1), point 8, of the Momsloven. It held that a boat owner rents, for a price determined by the surface occupied, a specific and identifiable area to which he has free access during the winter.

Both FML and the Skatteministeriet brought proceedings to challenge the Landsskatteret’s order before the Vestre Landsret. Since the latter takes the view that the resolution of the dispute before it requires the interpretation of Article 13B(b) of the Sixth Directive, it has decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

The first question

By its first question the national court asks, essentially, whether Article 13B(b) of the Sixth Directive must be interpreted as meaning that the concept of letting of immovable property includes the letting of water-based mooring berths and land storage sites for boats within the port area.

Observations submitted to the Court

FML asserts that its activity of letting mooring berths and winter storage sites for boats fulfils the conditions laid down by the case-law of the Court for letting of immovable property within the meaning of Article 13B(b) of the Sixth Directive. Its activities give rise to the payment of rent, the site is let for a fixed contractual period and the letting involves the transfer to the lessee of rights to use the property and to exclude third parties from it.

As regards the nature of the object let, FML argues that the port installations constitute fixed structures which cannot easily be dismantled or moved.

The Danish Government takes the view that the letting of mooring berths cannot be regarded as the letting of immovable property within the meaning of Article 13B(b) of the Sixth Directive, because the exemptions provided for by that article must be interpreted strictly.

It argues that even if the port installations may be treated as ‘immovable’, the decisive element in defining the concept of ‘immovable property’ for the purposes of the Sixth Directive, the use of those installations for mooring boats is only an ancillary service which for tax purposes must be treated in the same way as the main service, which is to attribute a mooring berth in the port to boat owners. The latter fails to fulfil the requirements for falling within the definition of immovable property.

On the other hand, letting a clearly defined land site to a boat owner for winter storage should be treated as the letting of immovable property within the meaning of the Sixth Directive.

The Greek Government supports the Danish Government’s view that the definition of ‘letting immovable property’ does not cover a defined and identifiable water-based mooring berth, but does cover letting land sites for the winter storage of boats.

The Commission of the European Communities submits that it is clear from the Court’s very broad interpretation of the terms ‘letting and leasing of immovable property’ that the letting of parts of port land for the winter storage of boats undeniably constitutes a letting of immovable property within the meaning of the Sixth Directive. Furthermore, the letting of a water-based mooring berth cannot be treated differently depending on technical features, such as whether a boat is moored to a buoy or to pontoon bridging, rather than being anchored to the sea bed or moored to a mooring plate.

Findings of the Court

According to settled case-law, the exemptions provided for in Article 13 of the Sixth Directive have their own independent meaning in Community law which must therefore be given a Community definition (see Case C-358/97 Commission v Ireland [2000] ECR I-6301, paragraph 51; Case C-315/00 Maierhofer [2003] ECR I-563, paragraph 25; Case C-275/01 Sinclair Collis [2003] ECR I-5965, paragraph 22; and Case C-284/03 Temco Europe [2004] ECR I-0000, paragraph 16).

In the absence of a definition of ‘letting of immovable property’ in Article 13B(b) of the Sixth Directive, that provision must therefore be interpreted in the light of the context in which it is used and the scheme of the Directive, having particular regard to the underlying purpose of the exemption which it establishes (see, to that effect, Temco Europe, paragraph 18).

In that connection, given that the exemptions referred to in Article 13 of the Sixth Directive are exceptions to the general principle that VAT is to be levied on all services supplied for consideration by a taxable person, they should be interpreted strictly (see, in particular, Commission v Ireland, paragraph 52; Case C-359/97 Commission v United Kingdom [2000] ECR I-6355, paragraph 64, and Sinclair Collis, paragraph 23).

In numerous judgments the Court has defined the letting of immovable property, within the meaning of Article 13B(b) of the Sixth Directive, as the landlord assigning to the tenant, in return for rent and for an agreed period, the right to occupy his property and to exclude other persons from it (see, to that effect, Commission v Ireland, paragraphs 52 and 57; Case C-409/98 Mirror Group [2001] ECR I-7175, paragraph 31; Case C-326/99 ‘Goed Wonen’ [2001] ECR I‑6831, paragraph 55, and Temco Europe, paragraph 19).

In the main proceedings, it is common ground that the relationship between FML and the users of the land sites, who have exclusive use of the sites assigned to them for a fixed period, fall within the definition of letting in that provision. The same is true as regards the relationship between the FML and users of water-based mooring berths, even occasional users, as a mooring berth may be temporarily occupied by another boat when the lessee is not using it for his own. Since such occasional use does not cause harm to the lessee, it cannot be regarded as altering the relationship between him and the port management.

Therefore in order to answer the first question it remains to be established whether land- and water-based moorings for boats must be regarded as immovable property.

As regards the land sites, it must be observed that the ground used for the storage of boats is immovable property.

In the case of water-based mooring berths, the order for reference indicates that FML is the owner of the port land and the port basin. The fact that that land is partly under water does not prevent it from being categorised as immovable property that can be leased or let. As the owner FML may rent out all the port land, including specified parts of it. The letting does not, however, concern a particular quantity of water, but a specific part of the port basin. That water-covered area is clearly delimited and cannot be moved.

Consequently, as the Advocate General pointed out in paragraph 32 of her Opinion, even on a narrow interpretation of Article 13B(b) of the Sixth Directive a mooring berth in a port basin fulfils the definition of immovable property within the meaning of that article.

The answer to the first question must therefore be that Article 13B(b) of the Sixth Directive must be interpreted as meaning that the concept of letting of immovable property includes the letting of both water-based mooring berths for boats and land sites for storage of boats on port land.

The second question

By its second question the national court asks, essentially, whether the definition of ‘vehicles’ in Article 13B(b)(2) of the Sixth Directive includes boats.

Observations submitted to the Court

FML asserts that it is clear from Article 15(2), 28a(2)(a) and 28n(4)(b) and (c) of the Sixth Directive that the Community legislature draws a distinction between the terms ‘means of transport’ and ‘vehicles’. Where a provision covers all means of transport, that is to say aircraft, motor vehicles, boats, etc., the expression ‘means of transport’ is used. On the other hand, the term ‘vehicles’ is used only for land-based means of transport on wheels. The definition of ‘vehicles’ as referred to in Article 13B(b) of the Sixth Directive covers, therefore, only means of land-based transport, and therefore the answer to the second question must be in the negative.

The Danish and Greek Governments take the view that ‘vehicles’ must not be interpreted strictly. The definition should therefore cover anything which may transport a person from one point to another, including boats.

The Commission also submits that, notwithstanding the different terminology in the various language versions of Article 13B(b)(2) of the Sixth Directive, the word ‘vehicles’ is in fact used consistently throughout the Directive and covers means of transport in the broad sense, including boats. A contrary interpretation has illogical consequences which are incompatible with the principle of fiscal neutrality.

Findings of the Court

The words used in the various language versions of Article 13B(b)(2) to designate ‘vehicles’ are not consistent. As the Commission rightly stated, a number of language versions, among which are the French, English, Italian, Spanish, Portuguese, German and Finnish versions, encompass means of transport in general in that definition, including aircraft and boats. On the other hand, other versions, such as the Danish, Swedish, Dutch and Greek versions, have selected a more precise term with a more limited meaning which serves to designate principally ‘land-based means of transport’. More particularly, the Danish word ‘kjøretøjer’ refers to land-based transport on wheels.

In that connection it must be recalled that, according to settled case-law, where there is a difference between the language versions the provision in question must be interpreted by reference to the purpose and general scheme of the rules of which it forms a part (see, in particular, Case C‑372/88 Cricket St Thomas [1990] ECR I-1345, paragraph 19, and Case C-384/98 D [2000] ECR I-6795, paragraph 16).

As regards the letting of premises and sites for parking vehicles, Article 13B(b)(2) of the Sixth Directive introduces an exception to the exemption laid down for the leasing and letting of immovable property. It thus makes the transactions to which it refers subject to the general rule laid down in that directive, namely that VAT is to be charged on all taxable transactions, except in the case of derogations expressly provided for. That provision cannot therefore be interpreted strictly (see Case C‑346/95 Blasi [1998] ECR I-481, paragraph 19).

Therefore, the term ‘vehicles’ used in that provision must be interpreted as covering all means of transport, including boats.

45

Letting mooring berths for boats is not limited solely to the right to privately occupy the surface of the water, but also involves making available various port equipment for mooring the boat, landing-stages for the crew and the use of various sanitary or other facilities. As the Advocate General points out in paragraph 51 of her Opinion, none of the reasons, including the social ones, that originally justified allowing the exemption from VAT for immovable property may be applied to the letting of mooring berths for pleasure boats in the circumstances in the main proceedings.

46

In those circumstances, having regard to the objectives of Article 13B(b) of the Sixth Directive, point 2 of that provision, which excludes the letting of premises and sites for parking vehicles from the exemption from VAT, must be interpreted as meaning that it is generally applicable to the letting of premises and sites for parking all means of transport, including boats.

47

In the light of the foregoing, the answer to the second question must be that Article 13B(b)(2) of the Sixth Directive is to be interpreted as meaning that the definition of ‘vehicles’ includes boats.

Costs

48

Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Third Chamber) rules as follows:

1.Article 13B(b) of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes – Common system of value added tax: uniform basis of assessment, as amended by Council Directive 92/111/EEC of 14 December 1992, must be interpreted as meaning that the concept of letting of immovable property includes the letting of both water-based mooring berths for pleasure boats and land sites for storage of boats on port land.

2.Article 13B(b)(2) of Sixth Directive 77/388, as amended by Directive 92/111, must be interpreted as meaning that the definition of ‘vehicles’ includes boats.

[Signatures]

* * *

1 – Language of the case: Danish.