Clifford Chance

VAT earthquake strikes Dutch CLOs: implications for the markets

2 December 2024

On the afternoon of Friday 21 February 2020, Euronext Dublin's regulatory news service exploded with dozens of notices served by Dutch CLO issuers, informing investors that the CLOs' VAT exemption for collateral management and administration fees had been revoked. Worse still, the revocation had retrospective effect back to 1 April 2019.

This was a development which has been feared since the December 2015 Court of Justice of the European Union (CJEU) judgment in the Fiscale Eenheid X case, but which it was hoped would not come to pass.  What does that mean for the European CLO industry and what comes next?  

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