Under a consignment stock arrangement, the supplier (consignor) places the goods at the disposal of the buyer (consignee), who purchases and ´flash sells´ the goods as soon as he finds a client.
Where consignment stock happens as part of an international trade agreement, the supplier is often required to register for VAT in the country of the customer. However, some countries allow a simplification where the supplier does not register and the customer reports an intra-Community acquisition when he retrieves the goods from the warehouse. In Italy, this simplification is foreseen under contracts called contratti estimatori. In these cases, the goods must be stored in the consignee’s premises, who has full control on the sale of these goods.
Italy introduced a consignment stock simplification for intra-Community trade within the EU. The conditions for this simplification to apply are:
We refer to consignment stock when the goods are placed in a warehouse in the country of the customer and they are under control of one or more clients, who can retrieve them from the warehouse as and when required. Call-off stock refers to goods placed at the premises of one single client who has full individual control over the sale of these goods.