ECJ Case Law, of June 12, 2014, the concept of “other securities” and “other negotiable instruments” in connection with a discount card


The Court of Justice of the European Union has ruled on the preliminary ruling in relation to the concepts of “other securities” and “other negotiable instruments” regarding the exemption provided for in Article 13 of the Sixth Directive (exemptions relating to financial transactions).

The case comes from the fact that the company Granton Advertising BV considered as exempt from VAT supplies of discount card that gave the acquirer the right to purchase a number of goods and services on preferential terms in trade and businesses such as restaurants, cinemas, hotels, etc.

The Court, on the one hand, does confirm that the use of such card is considered as a reduction of the price of the good or service purchased by the consumer (not the consideration of benefits that consumers can subsequently benefit from the participating companies) and as such, should not be included in the taxable amount of the transaction in question.

Similarly, regarding the inclusion of these cards within the concepts of “other securities” or “other negotiable instruments” set forth in Article 13 of the Sixth VAT Directive, the Court decides that the cards, and purpose of use thereof, do not fall within the restrictive use aimed to be given by the European Directive to such expressions, and that do not correspond to the context which reflects the purpose of the exemption in Article 13, that is, only financial transactions.

A copy of the judgment of the ECJ is attached.

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