On October 11, 0213, the Dutch Supreme Court ruled that the four companies involved did form a VAT group although the Court in Arnhem ruled otherwise. The Supreme Court decided that the holding company and its three subsidiaries were sufficiently financially, economically and organizationally connected to form a VAT group. In contrary to the Courts previous ruling the Supreme Court ruled that where a holding company:
- holds all the shares in three subsidiaries;
- receives a management fee from these subsidiaries (the management fees were approximately 10 percent of the total turnover of the holding and the management fees were not more than 50 percent of the respective turnovers of the subsidiaries); and
- has an (not negligible) economic relationship with its subsidiaries (like the lease of a building in this case)
there was enough nexus to meet the economic link requirement. In this respect it is not important that the companies do provide services or goods to third parties to a greater or lesser extent.
This decision could make it easier to form a Dutch VAT group, i.e. it is easier to meet all three requirements.