C-369/04: Hutchison 3G & C-284/04: T-Mobile Austria
A ruling by the ECJ on 26th June means that Revenue and Customs will not have to pay a VAT claim for over £3 billion brought by the winners of the third generation mobile phone spectrum auction in 2000.
The mobile phone companies had claimed that the £27 billion paid by them for spectrum licences included £3 billion VAT, which they were entitled to reclaim. However, the ECJ today ruled that the UK’s allocation of spectrum was not “economic activity” and hence was not subject to VAT.
The judgment will come as a relief not just to the UK but also to many other Member States, including Germany, the Netherlands, Ireland and Spain, where similar auctions were conducted and similar VAT claims made by the winners; a case from Austria on the same point was the subject of a parallel ECJ judgment today.
Barristers from Monckton Chambers acted on each side in this case: the mobile phone companies were represented by Paul Lasok QC, and Revenue and Customs by Christopher Vajda QC and George Peretz.