In Vodafone Portugal – Comunicações Pessoais SA v Autoridade Tributária e Aduaneira (Case C-43/19) (11 June) the CJEU held that amounts received by an economic operator in the event of early termination for reasons specific to the customer of a services contract requiring compliance with a tie-in period in exchange for granting that customer advantageous commercial conditions must be considered to constitute the remuneration for a supply of services for consideration.
The taxpayer entered into agreements with its customers for the provision of telephone services. One such agreement involved a ‘tie in period’ under which customers committed to maintaining a contractual relationship with the taxpayer for a certain period in return for commercial benefits (e.g. discounts and ‘free’ installation services). The agreement provided that should a customer fail to comply with the tie-in period for reasons of its own it would be required to pay an amount...
