Article 107
The services referred to in Article 106 must meet the following conditions: (a) they must be labour-intensive; (b) they must largely be provided direct to final consumers; (c) they must be mainly local and not likely to cause distortion of competition. There must also be a close link between the decrease in prices resulting from the rate reduction and the foreseeable increase in demand and employment. Application of a reduced rate must not prejudice the smooth functioning of the internal market.