Finanzamt Leverkusen v Verigen Transplantation Service International AG

In Finanzamt Leverkusen v Verigen Transplantation Service International AG (ECJ Case C-156/09) a German biotechnology company extracted cells from patients’ joint cartilages multiplied them in a laboratory and prepared them for reintegration into the patients’ bodies. The tax authority issued an assessment charging VAT on such supplies and the company appealed contending firstly that the supplies were exempt under Article 13A1(c) of the EC Sixth Directive and alternatively that they fell within the derogation in Article 28b(F). The case was referred to the ECJ which found in favour of the company holding that Article 13A1(c) ‘must be interpreted as meaning that the removal of joint cartilage cells from cartilage material taken from a human being and the subsequent multiplication of those cells for reimplantation for therapeutic purposes constitute “provision of medical care”’. Accordingly the company’s supplies were exempt from VAT.