I: Compulsory taxable transactions

I.-Taxable persons who have in France the seat of their economic activity or a permanent establishment or, failing that, their domicile or habitual residence, with the exception of permanent establishments of these taxable persons which are not located in France, and who are closely linked to each other from a financial, economic and organisational point of view may request, for the application of the provisions of this chapter, to constitute a single taxable person within the meaning of Article 256 A.

II.-1. Taxable persons directly or indirectly controlled in law by the same person, including that person, are considered to be financially linked to each other. This condition is met when a taxable person, or a non-taxable legal person, holds more than 50% of the capital of another taxable person, directly or indirectly through other taxable persons or non-taxable legal persons, or more than 50% of the voting rights of another taxable person or non-taxable legal person under the same conditions.

Taxable persons and non-taxable legal persons are also considered to be financially linked. The following are also considered to be financially linked to each other:

a) Central bodies, caisses d'assurance and other bodies that are not taxable persons under the same conditions a) The central bodies, funds and federations referred to in Articles L. 511-30, L. 512-55 and in b of Article L. 512-1-1 of the Monetary and Financial Code as well as their members or affiliates mentioned in Articles L. 512-11, L. 512-20, L. 512-55, L. 512-60, L. 512-69 and L. 512-86 of the same code;

b) The members of the groups provided for in Article b) Members of the groupings provided for in articles L. 931-2-1 and L. 931-2-2 of the Social Security Code, to the article L. 111-4-2 du code de la mutualité as well as articles L. 322-1-2 and L. 322-1-3 and in 5° of Article L. 356-1 of the Insurance Code;

c) Persons who meet the conditions for drawing up combined accounts pursuant to article L. 345-2 of the Insurance Code, article L. 212-7 du code de la mutualité or the article L. 931-34 of the Social Security Code;

d) Associations set up in accordance with the agreement of 25 April 1996 on common provisions for AGIRC and ARRCO, responsible for the governance of a joint social protection group under the conditions set out in the agreement of 8 July 2009 on the governance of joint social protection groups, and associations and economic interest groupings controlled by these umbrella associations, whose members include either at least one federation or supplementary pension institution governed by Title II of Book IX of the Social Security Code, or at least one association or economic interest grouping whose members include at least one such federation or institution;

e) The coordination companies mentioned in article L. 423-1-2 of the Code de la construction et de l'habitation and the organisations that hold their capital.

2. Taxable persons carrying out:

either a) either a principal activity of the same kind;

or b) Interdependent or complementary activities or activities pursuing a common economic objective;

> or c) an activity carried out wholly or partly for the benefit of other members;

>. 3. The following taxable persons shall be deemed to be linked to each other at organisational level:

a) who are, in law or in fact, directly or indirectly, under common management, or,

b) organise their activities in whole or in part in concert.

4. The financial, economic and organisational links referred to in I must exist when the option referred to in 3 of III is exercised and continuously throughout the period covered by the application.

III. III.-1. A taxable person may only be a member of a single taxable person. A single taxable person may not be a member of another single taxable person. 2. The members of the single taxable person shall appoint from among their number a representative who undertakes to fulfil the reporting obligations and any formalities relating to value added tax incumbent on the single taxable person and, in the case of taxable transactions, to pay the tax on his behalf and to obtain refunds of value added tax credits. Each member of the single taxable person remains jointly and severally liable for payment of the value added tax and, where applicable, the corresponding late payment interest, surcharges and tax fines for which the single taxable person is liable, up to the amount of the duties and penalties for which he would be liable if he were not a member of the single taxable person.

The single taxable person shall file his VAT returns with the tax authorities. The single taxable person must submit his turnover declarations in accordance with the procedures set out in the first paragraph of Article 287(2).

3. The creation of a single taxable person is carried out by means of an option submitted by the representative to the tax department to which the taxable person belongs. This option can only be exercised with the agreement of each of the members of the single taxable entity.

The option is made no later than 31 October of the year preceding its application. It takes effect on 1 January of the year following the year in which it was made and must cover a period of three calendar years.

Any member of a single taxable person may opt for a period of three calendar years. Any member of a single taxable person is no longer a taxable person within the meaning of Article 256 A. It constitutes a sector of activity.

At the end of the compulsory period referred to in the second paragraph of this 3 and with the express agreement of each of the members of the single taxable person, the single taxable person may be terminated upon termination of the option by its representative. This withdrawal takes effect from the first day of the second month following the month in which it was made.

Notwithstanding the compulsory period referred to in the same second paragraph, the single taxable person status ceases automatically on the date on which the conditions referred to in I and II are no longer met. This applies in particular in the event of the withdrawal of its penultimate member. The representative informs the administration of this without delay.

4. The introduction of a new member of the single taxable person may only take place at the end of the compulsory period referred to in the second paragraph of 3 of this III, unless this introduction concerns a taxable person who, on the date on which the option referred to in the same second paragraph takes effect, did not meet the linkage conditions referred to in I and II. This introduction is subject to compliance with the linkage conditions mentioned in the same I and II and must be formulated by the representative of the single taxable person accompanied by the express agreement of the member concerned. The request takes effect on 1 January of the year following the year in which it is made.

At the end of the compulsory period, the member must give his express consent. At the end of the compulsory period referred to in the second paragraph of 3 of this III, any member of a single taxable entity may decide to withdraw from the scheme with effect from 1 January of the following year with the agreement of the representative of the single taxable entity. The representative shall inform the administration of this decision by 31 October of the year preceding that in which the member withdraws at the latest.

A member's membership of the single taxable entity ceases automatically on the first day of the month following the month in which that member no longer meets the linkage conditions referred to in I and II. The representative shall inform the administration without delay.

5. Each year, by 31 January at the latest, the representative sends the administration a list of the members of the single taxable entity as assessed on 1 January of the same year.

6. The value added tax credit recorded by a member of the single taxable person in respect of a period prior to the entry into force of the option provided for in this III may not be carried over to a return filed by the single taxable person. This credit gives rise to reimbursement to this member under the conditions laid down in IV of Article 271.

The value added tax credit recorded on the return referred to in Article 287(2) filed by the single taxable person during the application of the optional scheme provided for in I of this article is definitively acquired by him.

7. The existence of the single taxable person for the purposes of applying the rules on value added tax has no impact on the other taxes, duties and levies of any kind for which its members are liable.