• Case C-28/16 - Examines the right of a holding company to deduct input VAT on services acquired in the interest of its subsidiaries wherethose services are offeredto its subsidiaries with no consideration
  • April 17, 2017
  • Law Firm: Kinanis LLC - Nicosia Office
  • On 12 January 2017, the European Court of Justice delivered its judgment in the case of MVM (C-28/16), concerning the right of MVM to deduct input value added tax (VAT) paid in relation to services procured in the interest of its subsidiaries. This case re-iterates the principles that need to be considered in order to determine whether the involvement of a holding company, in the management of its subsidiaries, without charging those subsidiaries either for the cost of the services procured in the interest of the group of companies as a whole or in the interest of certain of its subsidiaries, nor for the corresponding VAT, constitutes an ‘economic activity’, within the meaning of the Council Directive 2006/112/EC of 28 November 2006 (EU Principal VAT Directive).