The Court of Justice of the European Union (CJEU) has ruled in CfBk Gesellschaft für Börsenkommunikation mbH v Finanzamt Bayreuth (Case C-275/11), that advisory and information services, consisting of advising on the management of a fund and making representations for the sale and purchase of assets provided by a third party to the manager of a “special investment fund”, constitute supplies of “management of special investment funds” and are accordingly exempt from VAT.

The CJEU’s decision confirms the approach adopted by HMRC following Abbey National (Case C-169/04) and will result in lower costs for those funds that outsource their advisory and information services, thereby increasing returns for their investors and preserving equality of VAT treatment with those funds that do not outsource such services.