Ordinance no. 6/2020 for amending and supplementing Law no. 227/2015 regarding the Fiscal Code - transposed into national law the provisions of Directive 1910/2018 (the so-called "quick fixes")

In brief 

The Ordinance transposes into national law the provisions of Directive 1910/2018, which establishes a common regulatory framework at the EU level for the following operations: simplification of call-off stock arrangements, allocation of transport for chain transactions and the conditions for applying the VAT exemption for intra-Community supplies (the so-called "quick fixes").

In detail

1. VAT Quick Fixes

We present below the Ordinance’s main provisions for those operations.

1. VAT exemption for Intra-Community supplies

The Ordinance adds the correct reporting of the transactions in the recapitulative statement (390) as a substantive condition in order to apply the VAT exemption for intra-community supplies of goods, other than new transport means or excisable goods.

The Fiscal Code provisions regarding the conditions for the application of VAT exemption for the intra-community supplies are completed with the provisions of Regulation no. 1912/2018, which modifies EU Regulation no. 282/2011, introducing two relative presumptions regarding the documents necessary for proving the transport of the goods to another Member State.

According to the aforementioned Regulation, if the transport of goods is performed by the supplier, in order to prove that such transport took place, the supplier should hold two relevant items of evidence issued by two entities independent of each other, as well as of the supplier and the client. If the transport is performed by the client, additionally to the above-mentioned documents, the latter has to provide the seller with a written statement confirming that the goods were transported by the client. That statement should contain: the issue date, the buyer’s name and address, the nature and quantity of the goods, the date and place of receipt of the goods and, in the case of means of transportation, the vehicle identification number and the identification details of the person who accepted the goods in the buyer’s name. The statement should be provided by the tenth day of the month following the delivery.

In the above, it is presumed that the goods are transported to another Member State if two of the following means of proof are held: documents relating to the dispatch or transport of the goods, such as a signed CMR document or note, a bill of lading, an air freight invoice or an invoice from the goods carrier, or one means of proof of those previously mentioned and one document from the following: (i) an insurance policy with regard to the dispatch or transport of the goods, or bank documents proving payment for the dispatch or transport of the goods; (ii) official documents issued by a public authority, such as a notary, confirming the arrival of the goods in the Member State of destination; (iii) a receipt issued by a warehouse keeper in the Member State of destination, confirming storage of the goods in that Member State.

2. Call-off stock arrangements

The quick fixes for call-off stock arrangements are introduced in the Fiscal Code with a set of application conditions slightly different from those previously stated in Ministry of Public Finance Order no. 4120/2015. Under the new conditions, a taxable person established in one Member State which transfers goods to another taxable person established in another Member State, within a call-off stock arrangement, does not perform a transfer and, therefore, does not have to register for VAT purposes in the territory where the goods are in stock if the following conditions are cumulatively met: 

• The goods are shipped by a taxable person to another Member State in order to be supplied in that Member State to another taxable person, based on a previous agreement;

• The taxable person is not established and does not have a permanent establishment in the Member State to which the goods are shipped;

• The taxable person to which the goods are shipped is registered for VAT purposes in the Member State to which the goods are shipped, with its identity and VAT code known to the taxable person shipping the goods;

• The taxable person shipping the goods records the transfer of goods in a special ledger provided by Regulation no. 1912/2018 and includes in the recapitulative statement both the identity and VAT code of the taxable person which purchased the goods. 

The taxable person has to register for VAT purposes and declare an assimilated intra-community acquisition of goods in the following situations: if any of the above-mentioned conditions are not met, when goods stay in stock for more than 12 months, goods are destroyed or stolen, or the goods are sent to another Member State or exported. 

3. Chain Transactions

Chain transactions are a set of successive supplies of goods performed by an operator to an intermediary operator, which supplies the goods to a final client, with the goods being transported from the initial operator directly to the final client, from one Member State territory to another. 

The Ordinance states that the transport is allocated only for the delivery performed by the operator to the intermediary operator. By exception, the transport is allocated to the supply performed by the intermediary operator if it communicated to the supplier its VAT registration code from the Member State from which the goods are delivered.

The above provisions entered into force on 3.02.2020. 

2. Statements 392A and 392B

Moreover, the Ordinance also suspends until 31 December 2022 the obligation to submit the 392A and 392B statements. 

The takeaway

The Ordinance modifies the VAT regime for the regulated operations. The new provisions will have a significant impact on economic operators when they come into force. As such, operators involved in chain transactions, intra-Community supplies or call-off stock arrangements should carefully analyse the changes, in order to adapt their flow of operations accordingly.