Broken Deals and EU VAT

The VAT treatment of the issue, acquisition, holding and sale of shares has become a rather complicated affair over the last thirty years. The case law of the Court of Justice of the European Union (CJEU) on this topic is fundamentally ambiguous, causing serious legal uncertainty among businesses. In its judgment in C&D Foods (Case C-502/17), the CJEU has added another dimension to that problem: what happens if an acquisition or a sale of shares is aborted? In particular: can a holding company deduct the VAT on the costs that it incurred with respect to the intended acquisition or sale of shares? In Ryanair (Case C-249/17), the CJEU ruled on an acquisition of shares which was eventually aborted. As seems to be the case with most of the CJEU’s case law on the EU VAT treatment of shares, these judgments not only provided answers, but also new questions.