National E-Systems for Combating VAT Evasion and Intra-EU Trade. Hungary’s ‘EAKER’ and Romania’s ‘RO e-Transport’

Abstract

(Series Information) European Papers - A Journal on Law and Integration, 2025 10(1), 55-96 | Article | (Table of Contents) 1. Introduction. – 2. A quick look at border and other types of checks. – 3. An overview of the two systems. – 3.1. Hungary’s EKAER. The old and the new versions. – 3.2. Romania’s e-Transport. – 4. Legal challenges. – 4.1. The CMR Convention. – 4.2. Conformity with EU free movement of goods law. – 4.3. Proving intra-EU transactions for VAT purposes. – 4.4. Conformity with Regulation 1100/2008 on the elimination of internal frontier checks. – 5. Practical challenges. – 5.1. Increased costs. – 5.2. Increased bureaucracy. – 5.3. User ‘friendliness’ and technical problems. – 5.4. Fragmentation of the internal market. – 6. Ways forward. – 6.1. Is Romania and Bulgaria’s full accession to the Schengen Area enough? – 6.2. Better awareness and enforcement of EU law. – 6.3. Would an EU-wide E-System be feasible? – 6.4. A multi-filter system and cross check for checking compliance. – 7. Conclusions. – Annex 1: Questionnaire. | (Abstract) The purpose of this paper is to critically look at two recent E-Systems – one introduced in Hungary (EKAER and more recently BIREG) and the other in Romania (RO e-Transport) – that apply or have until recently applied, among others, to the intra-EU transportation of goods to and from the countries in question. These E-Systems are meant to combat Value Added Tax (VAT) evasion. Whilst they pursue a worthy public goal, on a closer look they pose significant legal and practical challenges. From a legal perspective, these E-Systems and the compliance checks at the border that arise from their implementation amount to measures having an equivalent effect to quantitative restrictions, prohibited under Article 34 TFEU. Furthermore, they contravene secondary EU legislation, such as Regulation 1100/2008 on the prohibition of internal frontier checks, and the VAT Directive and its implementing regulations. The E-Systems also pose numerous practical challenges, such as increased direct and indirect costs for businesses and frequent technical problems. Furthermore, the introduction of national E-Systems increases the administrative burden that the transportation of goods entails and risks further fragmenting the Internal Market. Besides Romania and Bulgaria’s impending full accession to the Schengen Area and the need to increase awareness around EU law, a possible solution could be to set up an EU-wide E-System, managed by public authorities, for combating VAT evasion for the intra-EU transport of goods. Furthermore, instead of systematic border checks, compliance checks should be carried out in a country’s interior, using a multi-filter approach and cross-checks.

Keywords

• internal market
• free movement of goods
• border checks
• vat evasion
• ekaer
• e-transport