On 22 January 2024, a decision of the District Court of Zeeland-West-Brabant (the District Court) was published on whether or not a company that owns and operates various car parks (the company) qualifies as a so-called real estate entity (REE) for Dutch real estate transfer tax (RETT) purposes. In short, a company qualifies as a REE if both the ‘asset test’ and the ‘motive test’ are met. The acquisition of a REE is subject to Dutch RETT which is due by the purchaser of the REE. The decision of the District Court pertains to the motive test, the asset test was not in dispute. The District Court decided that, in this particular case, the company qualifies as a REE.

In light of the motive test, the question is whether the operation of the car park is regarded to be the mere passive exploitation of the real estate, or the exploitation of a more active business. In order to answer this question, the District Court refers to prior decisions of the Dutch Supreme Court on other companies’ operation of a hotel, recreation park, self-storage and datacenter business. In these cases, the Dutch Supreme Court decided that the motive test is not met if the exploitation of the real estate is subordinated to the whole of the accompanying (active) activities.

Facts and circumstances

A Dutch B.V. (the purchaser) acquired all of the shares in the company. The company was both the owner as well as the operator of the car parks. In respect to the operation of the car parks, the company offered both individual parking tickets as well as parking subscriptions. These tickets and subscriptions did not entitle the customers of the car parks to a fixed parking space. In addition, the company also offered certain accompanying facilities, amongst others:

• electrical charging stations;
• handicapped parking places;
• camera security;
• toilets;
• nearby employee in case of disturbances and calamities;
• cashless payment.

Decision by the District Court

The purchaser argued that the whole operation of the car parks contained more than the mere passive exploitation of the real estate. The purchaser stated, amongst others, that it concerns short-term parking, that customers are not entitled to a fixed parking space and that accompanying services are provided.

The District Court, however, decided that – given the facts and circumstances – the exploitation of the real estate is not subordinate to the whole of the accompanying activities. The purchaser endeavoured to convince the District Court with arguments and parallels with cases in which the courts decided otherwise. For instance, with the so-called ‘camping-case’, in which the Dutch Supreme Court decided that the exploitation of the real estate (camping) in fact was subordinate to the whole of the accompanying (active) activities. In the camping-case, however, the total package of additional services (e.g., cleaning services, breakfast, etc.) was more extensive. The comparison with the camping-case was therefore unsuccessful.

Practical consequences

This decision by the District Court affirms that companies owning and operating cars parks could still qualify as a REE, however that the actual assessment highly depends on the particular facts and circumstances. The exploitation of the real estate should be subordinate to the whole of the accompanying (active) activities. This assessment should be made on a case-by-case basis.