The EU VAT exemption for cost-sharing associations

The EU VAT system contains a large number of exemptions. A fairly unique exemption is that for the services rendered by umbrella organizations to the members of cost-sharing associations, which applies if a number of conditions are fulfilled. The exemption has drawn renewed attention because of two questions on its scope, which were recently referred to the European Court of Justice (ECJ). This article examines the background of the exemption, the conditions under which it applies and the preliminary questions referred to the ECJ.