07/12/2007 (Agence Europe) - On Wednesday 5 December, the European Commission adopted a draft decision authorising Germany and Poland to derogate from the VAT directive as regards the principle of territoriality. The two member states are engaged in a major construction project and/or maintenance of bridges with a view to upgrading the cross-border rail network. For VAT purposes, they will be able to consider the parts of the works for which they are responsible and which are physically located in the other member state as being on their own territory. Such derogation measures have already been authorised several times by the Council and seek to simplify the tax requirements on the companies supplying goods or providing services as part of the cross-border project. (M.B.)