Simplified Triangulation Scheme in the EU VAT System: Simplification or Increased Complexity for Businesses?

The European VAT Directive 2006/112/EC provides for a simplified scheme for triangular transactions, which is applicable, provided that certain formal and substantive conditions set by the legislative act itself, as well as by Implementing Regulation 282/2011, are met. In this article, the author explains how the multiple formal requirements imposed by the European legislator, along with the CJEU’s interpretation of the rules governing the simplified triangulation scheme, can be a particularly burdensome task for businesses. Furthermore, the combination of formal requirements with the practices followed by businesses may lead to the non-application of the simplified scheme for triangular transactions.