The Administrative Tribunal of Cergy-Pontoise issued the first decision on the merits concerning the application of the French Digital Services Tax (DST) on 23 September 2025. This decision, favourable to the taxpayer, gives an example of what it means for a service to be “economically independent” of a taxable digital service and therefore excluded from the DST base. 

A brief overview of the French DST

Since 2019, the French DST imposes a 3% levy on revenues from certain digital services provided in France: digital intermediation services - e.g. online marketplaces that connect users for the sale of goods or services - and targeted advertising services.

Some exceptions apply, notably for digital interfaces used primarily to provide digital content, communications services, or regulated payment services.  

In addition, the DST base does not include amounts paid for goods or services that are, in economic terms, independent from the access to and use of the taxable digital service. The test for “independence” draws on VAT principles, and the question is therefore whether the service forms an indivisible economic supply with the access to and use of the taxable service, or is a service which is ancillary to this access and use. 

The dispute 

The taxpayer argued that certain revenues had to be excluded from the DST base because they related to services that were economically independent of the marketplace service operated by its group. Two main offerings were at the heart of the case. First, logistical services (for example, storage, shipping and returns) that may be used by marketplace sellers. Second, a program offered to end customers combining notably fast delivery services with a suite of digital content and services (for example streaming and gaming services).

The decision

After a meticulous analysis deeply rooted in the facts, the Tribunal ruled entirely in favour of the taxpayer. 

For the logistical services, the tribunal notes that these services are optional and billed separately from marketplace fees, with pricing tailored to the seller’s logistics choices (such as parcel size, storage, and returns), these services are not limited to the marketplace (sellers can use them for their own websites or for third-party marketplaces), and that the visibility benefits on the marketplace are not limited to sellers using this logistical program. The tribunal concludes that, for the average seller, these services are distinct from the marketplace service and constitute an “end in itself” and not merely the means to benefit from the marketplace service in the best conditions. As such, these services are independent from the digital intermediation service. 

The other program received similar scrutiny. The tribunal notes that this program is optional for marketplace users, has its own terms and conditions and is invoiced separately, that the fast delivery is not available for all marketplace products, and that the program is heterogeneous, offering a mix of services, many unrelated to the access of the marketplace. The tribunal concludes that this program does not constitute a single transaction with the marketplace, but constitutes an “end in itself” for its subscribers, and is therefore independent from the digital intermediation service.

The decision is not final and may be appealed by the French tax authorities.