ECJ VAT Case law

For a transaction to qualify as a service, the service element of such a transaction must be of "decisive" (i.e. crucial) significance. Factors relevant in this regard can be the work/ materials ratio and the fact of whether the material or goods are supplied or provided without altering its nature and without adapting it to the specific requirements of the client  (to comply with the definition of supply of goods).

To determine the place of supply, reference needs to be made to the Sixth Directive, which provides that as regards the supply of goods including assembly thereof, the place of supply is the country in which the assembly or installation takes place. Hence in the given case, the place of supply is in several Member States. No VAT is due on supplies made to countries outside the EU. The price of the service to be supplies in each country is calculated pro rata the length of the cable laid in each territory.