CJEU: EV charge card Provider as commissionaire in EV Chain

17/10/24

On October 17, 2024, the Court of Justice of the European Union ('CJEU') released its judgment in the case of Digital Charging Solutions (C-60/23). This case concerns the supply of electricity for charging electric vehicles ('EVs') at public charging points. The CJEU, in line with the opinion of Advocate General ('AG') Ćapeta, ruled that this constitutes a supply of goods subject to VAT. The CJEU determined that the charging card provider does not perform financial services and indicated that the charging card provider may be considered as purchasing electricity from the Charge Point Operator ('CPO') and onward sell it to users (acting as a 'commissionaire').

What Does This Mean for Your Organization?

Businesses will need to assess, based on their contracts, pricing, and any credit facility they offer, whether they act as:

commissionaire for the supply of electricity, including related services such as providing a charging card and an authentication app;
commissionaire for the supply of electricity only, where the services have their own VAT treatment; or
service provider, not acting as a commissionaire.

Background

For an overview of the relevant facts and preliminary questions, we refer to our previous item 'CJEU Advocate General: card provider in the EV chain performs a supply of goods'.

In earlier cases, such as Auto Lease Holland and Vega International, the CJEU addressed the VAT treatment of the supply of fuel via fuel cards. In those cases, the CJEU concluded that the transaction between the fuel card provider and the user should be considered a financial service. The supply of fuel was deemed to take place directly between the energy supplier and the user. These rulings led to practical issues in various EU member states and, due to the financial service, to non-deductible VAT for fuel card providers.

This case does not concern the supply of fuel using a fuel card but the supply of electricity using a charge card.

CJEU Ruling

Last year, the CJEU already confirmed that the direct supply of electricity by the CPO to the end-user, combined with related services, constitutes one single supply of goods. This also applies in this case. The CJEU excludes the possibility of financial services as there is no credit mechanism for pre-financing the purchase of electricity. The CJEU indicates that, based on the commissionaire fiction, the charge card provider should be considered to purchase electricity from the CPO. This requires that the charge card provider has a mandate to trade electricity in its own name but on behalf of another person. Additionally, the (deemed) supply to the charge card provider must be identical to the (deemed) subsequent supply by the charge card provider. The CJEU also addresses the questions whether this is the case if the charge card provider performs additional services.

In this regard, the CJEU makes a distinction between additional services for which a separate fixed price is charged and services for which the price depends on the electricity supplied. If a fixed price is due, regardless of whether electricity is supplied, it is by definition a separate service with its own VAT treatment.

If the price depends on the electricity supplied, it must be assessed whether the services have their own VAT treatment or are considered a single supply together with the electricity. If the services are absorbed by the supply of electricity, the charge card provider may still act as a commissionaire.