In its 14 September 2017 judgment, the Court of Appeal of Helsinki dismissed all the claims filed by Finnish major finance and insurance companies relating to the return or compensation of value added tax (VAT) on postal services. The Court of Appel held that the District Court’s September 2016 judgments would not be changed. According to the Court of Appeal, charging VAT on postal services offered to contract clients was not against EU law. The Supreme Court did not grant a leave to appeal to the banks and insurance companies. Thus, the judgment by the Court of Appeal became final. Merilampi represented Posti Group Corporation and Posti Ltd in the matter.

The case concerned claims brought against Posti and the State of Finland in which compensation was sought from Posti for VAT which Posti had collected from postal services from 1999 to 2014. The claims were based on a view that the Finnish VAT law was against the EU VAT Directive. According to the claimants, Posti bore primary liability and the State of Finland secondary liability for the alleged damage caused to the claimants by the VAT payments collected contrary to EU law.

The Court of Appeal confirmed in its judgment, in accordance with the EU case law, that the services, which were individually negotiated and met the special needs of economic operators, did not fall under the scope of VAT exemption for public postal services. The Court of Appeal stated that, in this matter, the claimants had the chance to negotiate the terms of the services and to make separate agreements by which there was a derogation from the public postal services provided by Posti. The possible customer specific scope for negotiation has no decisive role in this case’s assessment. Taking into account the opening up of the postal market to competition and the principle of neutrality of taxation, it is, according to the Court of Appeal, clear that the services based on contract could not have fallen under the scope of universal services provided by Posti and exempt from VAT. Charging VAT for the postal services offered to the claimants was not against EU law, and there was no need to amend the judgment of the District Court.

The amount of the damages and other claims, demanded by the banks and insurance companies from Posti, amounted to more than 100 million euros.

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The District Court of Helsinki dismissed the finance and insurance companies’ claims that value added taxes in postal services were disallowed by EU law

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