CJEU judgment on app stores as VAT commissionaires
10/10/25
On October 9, 2025, the CJEU released its judgment in the case of Xyrality (C-101/24) on whether an App Store may be treated as a VAT commissionaire under Article 28 when facilitating in‑app purchases on its own name - even if the developer is named in the order confirmations. This ruling clarifies the VAT treatment of supplies made via digital platforms both pre-2015 and in the current day.
Background
This case concerns a German game developer that distributes apps via an app store operated by a company established in Ireland. From the end users’ point of view, the app store presents itself as the customer-facing interface and handles the payments for in-app purchases. However, the subsequent email confirmation to end users mentioned the German developer as supplier and showed German VAT. The German developer later argued that, under Article 28 of the VAT Directive (i.e., the “commissionaire fiction”), the Irish app store should be treated as the supplier to end users, and the German developer should be treated as supplying the app store. This would mean that the place of supply of its services to the app store would be determined by the main place of supply rule for B2B services (i.e., Ireland as per Article 44 of the EU Directive). The German tax authorities took the opposite view and assessed German VAT. The Bundesfinanzhof (German courts) referred three questions to the CJEU:
1. Whether in these circumstances the app store acts as a commissionaire , notwithstanding order confirmations naming the developer and showing German VAT.
2. If so, whether the place of supply of the deemed supply from developer to app store is determined by Article 44 (B2B) or Article 45 (B2C) of the EU VAT Directive.
3. Whether the developer is liable for German VAT because the order confirmations (with its agreement) named it and showed German VAT, even though recipients were non‑taxable persons.1. Whether in these circumstances the app store acts as a commissionaire , notwithstanding order confirmations naming the developer and showing German VAT.
CJEU judgment
In their ruling, the CJEU decided the following on the above questions posed by the German courts:
1. Commissionaire.
The fact that order confirmations sent after the transaction identify the German developer and mention German VAT does not, on its own, mean that the commissionaire provision is not applicable. The key is that the overall role and presentation of the intermediary (the Irish app store) in the transaction is assessed from the point of view of the end-consumer. Although the specific deeming presumption for electronic services in Article 9a of the EU VAT Implementing Regulation applies only from 1 January 2015, this Article was merely meant as a clarification of concepts already embedded in the Directive and does not justify a different reading for the earlier period. This argument builds on the case of Fenix International (C-695/20), where the CJEU ruled that Article 9a cannot be regarded as supplementing or amending article 28 of the EU VAT Directive.
2. Place of supply
Nothing in the Directive modifies the ordinary place‑of‑supply rules for the deemed supply created by the commissionaire fiction of Article 28. Accordingly, the deemed supply from the developer to the app store is located where the app store is established (in the case, Ireland).
3. No German VAT liability
Article 203 is aimed at preventing revenue loss from undue input VAT deduction; where recipients are non‑taxable persons, that risk is absent seeing as there is no VAT recovery right of the latter.
What does this mean for your business?
If you, your business or client are a digital platform and are involved in the electronically supplied services industry as a platform or other form of digital marketplace, this case could be highly relevant for your VAT position.
Most pertinently, if the platform (e.g., an app store) acts in its own name in customer‑facing journeys (branding, T&Cs, payment control, etc), Article 28 may deem the platform the supplier to consumers, with the underlying supplier performing a (deemed) B2B supply to the platform. Contractual terms, checkout design, invoicing practices, and key supply conditions are critical in assessing the extent of this liability. The CJEU ruled that this is also the case for supplies made prior to 2015, seeing as Article 9a of the Implementing Regulation is merely meant as a clarification of the existing commissionaire fiction rules as opposed to being a new lex specialis.
Further, this case highlights, once again, that substance precedes form. Post‑transaction confirmations naming the underlying developer and showing local VAT do not, by themselves, override the deemed supplier rules. For this reason, it is of the utmost importance to ensure current flows are in line with the (legal) reality from a VAT perspective, and VAT is not being incorrectly charged (or vice versa).
In light of the above, we strongly recommend you reach out to your preferred PwC Indirect Tax advisor to assist you to help you assess whether your business it not being caught up in the commissionaire fiction rules for platforms unbeknownst to you and your business. This includes reviewing contracts, general terms and conditions, platform UX, invoicing flows, and customer base amongst others.
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