AG: Danish art courtyard is goods; art status needs every part to qualify

Advocate General José Martín y Pérez de Nanclares proposes that a single VAT supply built around the physical handover of an artwork, with other elements as accessories, counts as a supply of goodsEuropa. The Danish Østre Landsret asked the General Court whether a Danish artist's school-courtyard commission is goods under Article 14(1) of the VAT Directive or services under Article 24(1)Europa, and whether it is an objet d'art that can benefit from a reduced taxable amount.

The commission covered design and realisation of an installation in a school courtyard: a concrete-surfaced area with gravel zones, pavilions, sculptures derived from moped parts, a water feature and trees, plus landscaping and renovation of the school's glass bay overlooking the courtyard. The artist's business concluded a contract with the educational establishment in October 2015 after sketches and models in 2014, delivered the work in early 2016 and saw it inaugurated in March 2016. It treats the whole as a supply of goods whose predominant element is a sculpture qualifying as an objet d'artEuropa. The Danish tax ministry treats the design and fitting-out as servicesEuropa and, for the goods alternative, denies that the result is a sculpture eligible for the reduced baseEuropa.

The Advocate General first questions the referring court's premise that all the elements form one supplyEuropa. Landscaping beyond preparation of the ground for the sculpture-bearing pavilions, and renovation of the glass bay, look like autonomous supplies rather than parts of the artwork, with no reciprocal indissoluble linkEuropaEuropaEuropa. Design work for a commissioned work is not an end in itself for the average consumerEuropa; what matters is acquisition of the finished workEuropa. Surrounding landscaping could be an accessory allowing the public to enjoy the work in the best conditionsEuropa, while the glass-bay renovation serves the building independentlyEuropa. Only if the artwork delivery is the principal supply with accessories sharing its tax treatment does the single-supply analysis proceedEuropa.

On that premise, the principal supply is physical: transfer of the power to dispose of tangible property as ownerEuropa. Site-specific design for the client's outdoor space and incorporation into that space do not turn the operation into a serviceEuropa. Where pavilions are included alongside the sculptures, their tangible character reinforces goods treatment, whether or not they form a building incorporated into the groundEuropa.

For objet d'art status, only the principal supply matters; accessory features are irrelevantEuropa. Moped-part sculptures, three-dimensional productions shaped by the artist expressing aesthetic ideas, fall within sculptures in Annex IX, Part A, point 3Europa, and their fixing into pavilions or the ground does not remove themEuropa, since removability is not a criterionEuropa. The pavilions are doubtful: concrete structures in terracotta colour with integrated tables and benches, serving as shelter or rest areas, may be artisanal architectural works competing with similar industrially or artisanally produced goods rather than original statuary or sculptureEuropa. Where sculptures and pavilions are combined supplies of equal weight, or a single composite work mixing an art element with another kind of good, the whole is an objet d'art only if every element forming the principal supply or supplies meets the definitionEuropa. That strict reading follows from the exception for reduced rates and from fiscal neutrality.

The proposal is not a judgmentEuropa. The General Court must still ruleEuropa, and the referring court must establish which elements form a single supply and whether the pavilions themselves are sculpturesEuropa.

Legal basis is Council Directive 2006/112/EC, Articles 14(1), 24(1), 81, 103 and 311(1)(2) with Annex IX, Part A, point 3 and Combined Nomenclature 9703 00 00, on a reference under Article 267 TFEU.