UT/2023/000067 - [2024] UKUT 00106 (TCC)

Ms Brown, appearing for HMRC, argued that the FTT was entitled to reach the conclusion that it did. The FTT had not, she said, ignored the effect of the Second Waiver, referring to it at [25]. QASL’s complaint was merely that the FTT did not attach the same weight to it that QASL wished.

The Upper Tribunal should only interfere, in Ms Brown’s submission, if the Decision was irrational. The FTT had accepted that the investment gold was never intended to leave the vaults. The FTT’s decision, however, was based on BullionVault’s terms which stated that the gold belonged to the customer and could be taken into its possession. It was HMRC’s case that the Notice did apply to the transactions in dispute because, primarily, the gold was made available to QASL’s customers or, alternatively, it was delivered. In both cases, a right of possession was sufficient.

Ms Brown contended that the Second Waiver did not assist QASL. The waiver was between QASL and BullionVault. The FTT made clear at [23] that BullionVault’s terms and conditions specified that the investment gold was held in the customer’s name and was physically held in the vault on the customer’s behalf. There was no waiver which prevented the customer from removing its gold from the vault.

In relation to Ground 2, Ms Brown submitted that the FTT had dealt with the interplay between the Notice and the legislative scheme at [17]. In short, the owner of the investment gold would have possession in the legal sense (i.e. the right to obtain physical possession) and that actual physical possession was not required.

For the avoidance of doubt, HMRC’s position, as set out in paragraph 45 of its skeleton in the FTT hearing, was that the agreement between HMRC and the LBMA was not applicable to the transactions in question, being those between QASL and its customers, none of whom were members of the LBMA.