One of the issues discussed at the Forum of the Confédération Fiscale Européenne (CFE) on 23 April 2009 was the VAT treatment of services exchanged between the various parts of a commercial group or entity that are separated by a national border. In this article, the author gives an overview of the discussions and concludes that, although it solves specific problems for a limited group of businesses, treating services exchanged between dependent parts of an entity or commercial group as being outside the scope of VAT is not consistent with the principles on which the VAT system is based.