The Provincial Administrative Court in Gdańsk just issued a verdict (dated August 30, 2023, ref. I SA/Gd 462/23) confirming the previous interpretative line of Polish tax authorities. The case, in which TPA Poland tax advisors were the party’s representatives, concerned the sale of electricity on a hydrocarbon (oil and gas) extraction platform.
The Court confirmed that activities conducted in the Exclusive Economic Zone (EEZ) in the Baltic Sea are treated as activities within the country’s territory, covered by the scope of the Polish VAT Act.
Doubts in the case arose from the way the territoriality of the Polish VAT Act is regulated, which in a literal reading do not provide a basis for including events taking place in the EEZ area located outside the borders of Poland.
This decision is of significant importance for entities conducting investments in offshore wind farms in the EEZ and their subcontractors. In the oral justification, the Court referred to the CJEU ruling of March 29, 2007, in case C-111/05, deriving from it that for the purposes of supplies and services directly related to the types of activities referred to in the United Nations Convention on the Law of the Sea, to which Member States have sovereign rights, the EEZ is recognized as part of their territory.
This decision is of significant importance for entities conducting investments in offshore wind farms in the EEZ and their subcontractors.
