«(Value added tax – Sixth Directive 77/388/EEC – Field of application – Factoring – Factoring company purchasing debts and assuming the risk of the debtors' default)»

1.. Tax provisions – Harmonisation of laws – Turnover taxes – Common system of value added tax – Economic activities for the purpose of the Sixth Directive – Meaning – Purchase of debts with assumption of the risk of the debtors' default – Covered (Council Directive 77/388, Arts 2, 4 and 17)

2.. Tax provisions – Harmonisation of laws – Turnover taxes – Common system of value added tax – Exemptions provided for by the Sixth Directive – Banking transactions referred to in Article 13B(d)(3) – Exclusion of debt collection and factoring – Meaning – Purchase of debts with assumption of the risk of the debtors' default – Covered (Council Directive 77/388, Art. 13B(d)(3))

JUDGMENT OF THE COURT (Sixth Chamber) 26 June 2003 (1)

((Value added tax – Sixth Directive 77/388/EEC – Field of application – Factoring – Factoring company purchasing debts and assuming the risk of the debtors' default))

In Case C-305/01,

REFERENCE to the Court under Article 234 EC by the Bundesfinanzhof (Germany) for a preliminary ruling in the proceedings pending before that court between

and

on the interpretation of certain provisions of the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes ─ Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1),

THE COURT (Sixth Chamber),,

composed of: J.-P. Puissochet, President of the Chamber, R. Schintgen (Rapporteur), C. Gulmann, F. Macken and J.N. Cunha Rodrigues, Judges,

Advocate General: F.G. Jacobs,

after considering the written observations submitted on behalf of:

having regard to the Report for the Hearing,

after hearing the oral observations of MKG-Kraftfahrzeuge-Factoring GmbH, represented by N. Ebbert, Rechtsanwalt, of the German Government, represented by M. Lumma, and of the Commission, represented by K. Gross and A. Böhlke, at the hearing on 9 January 2003,

after hearing the Opinion of the Advocate General at the sitting on 6 March 2003,

gives the following

The Sixth Directive

...

Without prejudice to other Community provisions, Member States shall exempt the following under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of the exemptions and of preventing any possible evasion, avoidance or abuse:...

...

Member States may allow taxpayers a right of option for taxation in cases of:...

Member States may restrict the scope of this right of option and shall fix the details of its use.

...

National legislation

...

...

...

...

...

On those grounds,

THE COURT (Sixth Chamber),

in answer to the questions referred to it by the Bundesfinanzhof by order of 17 May 2001, hereby rules:

Puissochet

Schintgen

Gulmann

Macken

Cunha Rodrigues

Delivered in open court in Luxembourg on 26 June 2003.

R. Grass

J.-P. Puissochet

Registrar

President of the Sixth Chamber