Since 2015 the new VAT rules raised by the EU are applicable for companies established in a EU member state and supply telecommunications, broadcasting and electronic services in the e-commerce business. The company must charge the VAT of the EU country the end consumer belongs to.
The bounce back feature can be used by transmitting the a two-digit country code via:
It is available for the following payment methods:
SEPA Direct Debit
Giropay (if an IBAN is sent)
The feature was implemented to support digital merchants to handle the new VAT rules raised by the EU in a more efficient way.
It can be enabled if a merchant intends to catch this information in the XML response.