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Changes to the rules of intra-Community trade in goods


The website of the Government Legislative Centre has posted yet another draft amendment this year to the Act on the tax on goods and services (UC158) resulting from the obligation to implement into the Polish legal system of the regulations contained in the Council Directive (EU) 2018/1910 and in the implementing Council Regulation (EU) 2018/1912.

Both legal instruments introduce Quick Fixes to Council Directive 2006/112/EC which modify the rules of settlements of intra-Community commodity trade in respect of:

  • Consignment warehouse mechanism,
  • Rules for chain transaction settlements,
  • Manner of documenting the export of goods within ICS transactions,
  • Conditions for a taxpayer being entitled to apply the 0% rate in ICS transactions.

Let us take a closer look at what are the most significant changes from our point of view.

Call-off stock type warehouses

As of the new year, a consignment warehouse will be replaced with a call-off type warehouse. The bill sets out different procedures for the operation of call-off stock warehouses depending on whether they are located on the territory of Poland or abroad. Repealing the legal definition of a consignment warehouse is not the only change in this respect. Also, the maximum period of storage of goods without tax implications for the supplier will be cut from 24 to 12 months. Failure by the purchaser to collect goods after the lapse of that period will entail an obligation on the part of the supplier to recognise a non-transactional transfer of own goods (ICN/ICS respectively) and to register for VAT purposes in the state in which the goods are being stored.

What is new is the ability to use the so-called call-off stock type warehouse procedure in respect of commercial goods and the introduction of the institution of remitter replacing the purchaser. It is also worth noting the extended documenting and reporting obligations applicable specifically to Polish taxpayers exporting goods to warehouses located outside the territory of Poland.

Chain transaction settlements

Settlements of chain transactions have always entailed doubts as to the determination of a mobile supply entitled to the 0% rate. The amended regulations unambiguously specify that a mobile transaction is a transaction for the benefit of an intermediary, provided that it is that entity that will organise the transport. By way of exception, a supply made by an intermediary will qualify as a mobile transaction on condition that it provides the supplier of the goods the VAT identification number from the country of dispatch. It is to be noted that the new regulations will only apply to intra-Community transactions comprising a maximum of 3 entities in a chain. In the event of more complex transactions, involving a greater number of entities, it will be necessary to analyse the contractual terms in question in order to identify an intermediary.

Chain transactions representing import or export of goods will continue to be settled in accordance with the currently binding rules.

Conditions for recogition and manner of documenting ICS transactions

Significant changes include the introduction of substantive conditions for being entitled to apply the preferential 0% rate, i.e. an obligation on the purchaser to provide a valid VAT identification number and a requirement that the supplier file a correct recapitulative statement. At a first glance, one might think that the above requirements follow from currently binding regulations. However, their current formal character entails that even in the event of failure to meet them, the taxpayer-supplier will still be entitled to apply the 0% rate. This will no longer be possible once the new regulation have come into force.

Finally, the intended assumption is worth mentioning of export of goods as part of an ICS transaction as is a closed catalogue of documents confirming such export depending on which party to the transaction is in charge of organising the transport.

The amendments discussed above will enter into force as of 1 January 2020. Although their final wording can be slightly modified by subsequent modifications to the amending bill, it is already worth analysing the flow of goods within one’s business model for potential adjustments to the proposed regulations and hence mitigating the risk of any irregularities.


Ewa Pyrkosz, Tax Consultant, ATA Tax Sp. z o.o.

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