A) General issues

Royal Decree-Law 3/2020, of February 4, on urgent measures incorporating into the Spanish legal system various European Union directives in the field of public procurement in certain sectors; of private insurance; of pension plans and funds; of the tax field and tax litigation, modifies with effect from March 1, 2020, Law 37/1992, of December 28, on Value Added Tax, incorporated into our internal regulations the harmonized tax rules in VAT of the so-called agreements for the sale of goods on consignment.

These are agreements for the sale of goods on consignment, agreements concluded between entrepreneurs or professionals for the cross-border sale of goods, in which a businessman (supplier) sends goods from one Member State to another, within the European Union, so that they are stored in the Member State of destination at the disposal of another entrepreneur or professional (customer), who can acquire them at a time after their arrival.

Until 1 March 2020, this operation gave rise to a transfer of goods or an operation similar to an intra-Community supply of goods in the Member State of departure of the goods, and to an operation similar to an intra-Community acquisition of goods in the Member State of arrival of the goods, carried out in both cases by the supplier.

Subsequently, when the customer acquired the goods, the supplier made an internal delivery in the Member State of arrival in which the reverse charge rule was applied, corresponding to its customer.

As of March 1, 2020, the new regulation establishes that deliveries of goods made within the framework of a consignment sales agreement will give rise to a single transaction: an intra-Community supply of goods exempt in the Member State of departure, carried out by the supplier, and an intra-Community acquisition in the Member State of arrival, carried out by the customer when collecting the goods from the warehouse.

This simplified treatment will only apply when the goods are acquired by the customer within one year of arrival in the Member State of destination. For these purposes, the date of acquisition will be the one to be taken into account for the purposes of the accrual of the respective intra-Community operations.

In any case, entrepreneurs or professionals may choose not to benefit from the simplification by failing to comply with the conditions provided for its application, in which case they would apply the general regime in force until March 1, 2020.

This section analyses the transfers of goods within the framework of agreements for the sale of goods on consignment and subsequent operations, both in the case where the goods are transferred from the territory of application of the Tax to another Member State, and in the opposite case, when the goods are transferred from another Member State to said territory.