On 13th May 2009, the Advocate General of the European Court of Justice issued an opinion to the ECJ in Swiss Re German Holding GmbH v Finanzamt München für Körperschaften, to the effect that transfers of reinsurance portfolios (within the EU) are subject to VAT.

His reasoning including the following:

  • the transfer of such contracts would not qualify as an insurance service
  • such transfers would not be considered VAT-exempted insurance services or VAT-exempted financial or banking services  

This reasoning would appear to apply equally to direct insurance contracts. If it does, this could have serious consequences for portfolio transfers.