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ECJ Case : C–275/11 - 07/03/2013



This case focuses, in particular, on the possible application of VAT exemption for investment advisory services provided by GfBk to a company managing the respective fund.

Within this role GfBk :

  1. advised in the management of a fund, and
  2. constantly monitored the fund and made recommendations for the purchase and sale of fund assets.

When advising the fund GfBk is also required to comply with the principles of risk diversification, statutory restrictions and investment restrictions.

The recommendations were communicated to the management company by the phone, fax or over the internet. The management company, after checking whether they contravened any statutory limits, implemented them.

Final decision of the Court

On 7 March, the Court has published its decision which is in favour of the VAT exemption of such investment advisory services (subject to the confirmation of the two characteristics of a VAT exempt management service).

This decision in favour of the VAT exemption is very important for the Luxembourg Funds Industry as the Luxembourg investment funds are the final recipients of these investment advisory services and Luxembourg keeps its competitiveness compared with any other offshore financial centres.



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