UT/2024/000002 - [2025] UKUT 00188 (TCC)

Mr Hitchmough KC, who alongside Ms Poots KC appeared for CBNA, helpfully clarified CBNA did not take issue with the way in which the FTT had set out the contractual material at [86] to [134]. The issue was with the FTT’s incorrect analysis of that material and thus its incorrect views of the correct contractual starting point. In particular, CBNA takes issue with the FTT’s conclusion that “any distinct services [were] to be identified and invoiced separately”. It is submitted that the FTT had, in reaching that conclusion misconstrued clause 1 of the Addendum to the 2010 GMSA, and clauses 2b) and 3b) of the earlier GMSAs. CBNA argue:

The FTT also, it is further submitted, misconstrued material provisions of the EAP, Paragraph 6.2 Appendix B of which set out that the Provider of:

“standalone and distinct services will be identified and all financial allocations from such providers will be treated as distinct services. These allocations will not be grouped with allocations from other providers for the purpose of either invoicing or of assessing liability for VAT and analogous charges.”

CBNA refers to the fact the FTT concluded from this (at FTT [276]) “It is therefore clear that any distinct services are to be identified and invoiced separately”. All that required however was identification of distinct services and that could be for example by itemisation. The fact that separate invoices were not required was made clear by example 1 at paragraph 7 of the EAP and was consistent with specimen and actual invoices. That example was explained in the EAP as follows:

“7.1

JPMorgan Securities Ltd might receive management accounting and financial allocations from JPMorgan Chase Bank NA in the US. The recipient cost centres might include various organizations within the Investment Bank front office. These cost centres would fall within a grouping of EMEA Equities whose role is broadly to provide various equities products to clients and manage those products. This Global EMEA grouping would fall within 1 above.

7.2

Allocations to this grouping might be made by cost centres from groupings such as End User Technology, Human Resources, Office of the General Counsel or Global Finance. These all have specific roles which involve providing services that are essentially distinct and allocations from each grouping would be treated as a separate service with its own consideration (the total sum of financial charges for products in that grouping). These will be separately identified on an invoice. These allocations would fall within examples from 2 above.

Mr Hitchmough also emphasised in oral submissions the reference to “identified on an invoice”. The Appellant also refers to the fact the specimen invoice at Appendix A of 2010 iteration of earlier GMSAs showed a) on first page the provider and recipient legal entities and a total charge for the services provided b) on second page a breakdown of that total with more detail by reference to “Receiving Business Area” c) on third page a more detailed breakdown by reference to Customer Business Area.”