Transactions in shares are exempt under Article 135(1)(f) of the Common VAT System Directive. However, in practice, the legal regime applicable to shares is based not on the interpretation of one single provision of the Directive, but rather on the joint interpretation of various inter-connected provisions. Within the last 15 years, the Court has been called to interpret these provisions, within the context of the VAT treatment of dealings in shares, on several occasions. However, far from having resolved all inherent conceptual and practical pitfalls of applying the EU VAT provisions to the sui generis nature of dealings in shares, it is clear that the case-law itself gives rise to various difficulties, thereby heightening the sense of legal uncertainty. This paper provides an analysis of the case-law of the Court in relation to transactions in shares, highlighting its evolution, as well as its consequences, from both a practical, and a conceptual, perspectives.
