The WOZ decision and associated assessment – every year the bill falls on the doormat. And every year it is exciting again how highly the municipality has valued the real estate. In addition to the valuation, a WOZ decision also provides insight into the number of appraised objects and the associated demarcation.
With object delineation in hand, companies that are involved in, for example, the construction of sun and wind farms, then knock on the door of their grid manager in order to adjust the amount of grid connections. Based on the statutory obligation to connect, network operators must comply with this and regard the object delimitation as a given. That this is not as black and white as it seems, is evident from a recent judgment of the Appeals Tribunal for Business (CBB). On 2 June 2020, it ruled that network operators are not bound by the object delimitation that a municipality has issued by means of its WOZ decision.
Object delineation and valuation
The municipality must establish the object definition as well as the value decision on the basis of Article 16 of the WOZ Act. A municipality must abide by the law and has no discretionary power to fill in matters as desired. As a taxpayer and recipient of such a WOZ valuation, you are fully entitled to object. But a grid operator does not have this legal process. After all, he is the third “out of the game”.
In line with this, the question arises whether network operators are automatically bound by the decision when complying with their connection obligation or whether they are allowed to assess the object delimitation themselves, on the basis of Article 16 of the WOZ Act. According to the CBB, any bondage is not apparent from the literal legal text, legal history or legal system.
This means that the CBB is of the opinion that a network operator who believes that the WOZ decision is based on an incorrect application of Article 16 of the WOZ Act bears the burden of proof to demonstrate this. If it succeeds in this, the demarcation from the municipal decree does not have to be followed. In other words: the WOZ object delimitation is, for the network manager, third, also rebuttable.
What if there is no decision issued by the municipality, but there is a company with a request for a grid connection on its doorstep? In accordance with the CBB ruling, the network operator may then delimit the object in question on the basis of previously established case law and the WOZ Act itself. To this end, the CBB provides a number of guidelines in the form of questions.
First of all, a network operator must check which real estate can be identified. As soon as it is established which immovable property is involved, the ownership of these properties or business entitlement must then be examined. In other words, this is the same person who has the business. Thirdly, the CBB believes that it should be examined whether the matters can be divided into sections which, according to their classification, are intended to be used as a separate whole. Finally, the question arises whether the real estate or independent parts thereof form an assembly.
Scope of the judgment
This CBB ruling has clarified energy law. However, the impact with regard to grid connections for wind and solar parks is limited, due to the so-called cutting ban. This legal prohibition means that installations for generating electricity using wind or solar energy that belong to the same company, have technical, organizational and functional ties and are close to each other, are deemed to have one connection.
The scope of the ruling is also expected to have an impact on taxation. Now the case law in the field of object delimitation, with the question in particular whether something is an assembly, has largely crystallized. Partly on the basis of the object definition from the WOZ decision, companies can have their amount of grid connections for the energy tax and storage of sustainable energy and climate transition adjusted at their electricity suppliers. This concerns so-called cluster requests or cumulative requests.
The energy suppliers in turn request approval from the tax authorities. In these petitions, the Tax and Customs Administration also assesses the municipal WOZ object delimitation. As a result of the CBB ruling, it may now theoretically happen that various WOZ object demarcations have their effect at the same time: the WOZ decision of the municipality, the object delimitation of the network operator and the object delimitation of the Tax and Customs Administration. Which object boundary will take precedence? Which object demarcation does more justice to Article 16 WOZ? Which object delineation will be most in line with case law?
This will undoubtedly cause confusion; it is therefore very important that all parties realize this.
Author: Mr. B.S. (Bastiaan) Kats
This article appeared in F&A Actueel 2020, Ep. 7.