We would like to inform you that today, i.e. 27.02.2025, the Court of Justice of the European Union (CJEU) made a milestone judgment in case C-277/24 (Adjak).
Question for a preliminary ruling
The question for a preliminary ruling was referred by the Voivodeship Administrative Court in Wrocław and concerns the interpretation of Article 273 of Council Directive 2006/112/EC of 28 November 2006 on the common system of value-added tax. The question aims to determine whether a national provision is consistent with EU law where, in proceedings concerning the determination of a company’s tax liabilities, a member of the management board of such a company is not granted the status of a party, despite the fact that this person may, in the future, be held liable for the company’s tax arrears under joint and several liability, which is adjudicated in separate proceedings.
Position of the CJEU
In its judgment, the Court of Justice of the European Union held that Article 273 of the Directive, in conjunction with Article 325(1) of the Treaty on the Functioning of the European Union (TFEU), as well as the right to defense and the principle of proportionality, should be interpreted as meaning that: It does not preclude national regulations and national practice whereby a third party, who may be deemed jointly and severally liable for the tax liability of a legal entity, cannot be a party to the proceedings conducted against that legal entity for the determination of its tax liability. This is without prejudice to the requirement that such a third party, in the course of any subsequent proceedings concerning joint and several liability, must be able to effectively challenge the factual findings and legal qualifications made by the tax authority in the initial proceedings and have access to its case file, in compliance with the rights of the legal entity in question or other third parties.
Implications for Taxpayers
First and foremost, it should be noted that the CJEU judgment pertains exclusively to proceedings concerning VAT liabilities, meaning that it is these national provisions that require unconditional amendment. However, it cannot be ruled out that, in light of this judgment, the Polish legislator may decide to undertake a comprehensive revision of regulations concerning third-party liability, which could extend to liabilities arising from other types of taxes.
Importantly, this judgment may serve as a basis for many taxpayers to request the reopening of proceedings that have been concluded by a final decision. Such proceedings may be reopened only upon a party’s request, submitted within the following deadlines:
- In the case of tax proceedings – within one month from the date of publication of CJEU judgment in the Official Journal of the European Union (pursuant to Article 240 § 1(11) in conjunction with Article 241 § 2(2) of the Tax Ordinance Act).
- In the case of administrative court proceedings – within three months from the date of publication (pursuant to Article 272 § 3 of the Act on Proceedings before Administrative Courts).
The judgment has not yet been published in the Official Journal of the European Union.
If you belong to the group of entities for whom this judgment may serve as grounds for reopening proceedings, we encourage you to contact us. We will be pleased to assist you in preparing and submitting the appropriate request.
Should you have any questions, we remain at your disposal.
