SPV's management fees (whether charged by Roundtable or the Deal Lead) are typically subject to VAT in France or Luxembourg. Below is a general explanation of how VAT applies and how it should be collected. Of course, you should continue to consult with your tax advisor to assess your own particular situation. 

Is the Roundtable Fee / Entry Fee subject to VAT?

The answer is yes, if the service is deemed rendered in France/Luxembourg (depending on the SPV's location). While you may be familiar with a VAT exemption for management of AIF, it is confirmed that our SPVs do not qualify as such and may not benefit from the AIF exemption. This means that the standard VAT rate (20%-17% respectively) applies.

How should VAT be collected?

The usual mechanism in international transactions between businesses is the reverse charge mechanism. However, this requires that the recipient of the services (in this case, the SPV) is itself registered with VAT. Our SPVs aren't registered with VAT for various reasons, the main one being that they do not collect any VAT towards third parties. As a result, the reverse charge mechanism cannot apply. This means that as a Deal Lead, you must collect and pay VAT to the relevant authorities yourself on your fee.

Is there any exception to this rule?

While most deal leads typically issue invoices that include VAT, we are not tax advisors, so we recommend consulting with your tax advisors to confirm your specific VAT obligations. If you believe your service should not be subject to VAT (e.g. VAT franchise), we can proceed accordingly if your invoice explains why it is not subject to VAT. However, our understanding is that VAT is most likely applicable, and you would need to collect it.