BackIn the Flemish Region of Belgium, the supply of energy to private individuals is regulated by the Energy Decree, supplemented by the Ministerial Order on Energy. The Flemish Electricity and Gas Regulator (VREG) appointed Fluvius, an inter-municipal cooperation structure made up of thirty-eight Flemish municipalities, as the legal entity in charge of managing the electricity or natural gas distribution network on the territory of a group of municipalities in the Flemish Region. Fluvius, as manager of the distribution network, transports electricity to individual installations and is responsible for the installation, commissioning and reading of meters.
During a certain period period, an individual consumed electricity illegally and Fluvius issued an invoice including VAT, as well as late payment and judicial interest, which was not paid. The Court considers that the supply of electricity by the distribution system operator, even if involuntary and resulting from the unlawful action of a third party, corresponds to a supply of goods made for consideration within the meaning of article 2.1.a) of Directive 2006/112. According to case law, the principle of fiscal neutrality in VAT matters is opposed to a generalized differentiation between legal and illegal transactions.
The direct link between the electricity unlawfully consumed and the amount claimed by Fluvius is clear from the data provided by the referring court, since the private individual obtained the electricity at his home and Fluvius was able to determine the amount thus obtained by reading the meter. Therefore, the amount claimed included the cost of the illegally consumed electricity. According to article 9.1 of Directive 2006/112, the supply of electricity by the distribution system operator, even if unintentional and resulting from the unlawful act of a third party, constitutes an economic activity carried out by the distribution system operator insofar as it reflects a risk inherent in its activity of managing the electricity distribution system. If this economic activity is carried out by a body governed by public law acting as a public authority, it can only be considered insignificant if it has a minimal dimension in terms of space or time and, therefore, such a small economic impact that the distortions of competition that may result are negligible or non-existent, in accordance with article 13.1.
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