Simplifications: processing of goods: processing in two Member States
Here the Principal (A) in Member State 1 (MS1) has its goods processed consecutively in different Member States. The first processor (B) in Member State 2 (MS2) sends the part-processed goods on to the second processor (C) in Member State 3 (MS3). The finished goods are eventually returned by C to A in MS 1.
B and C are supplying processing services to A who will account for the VAT due on each supply as a reverse-charge. The movements of goods between the Member States (which would otherwise amount to transfers of own goods by A) are disregarded as supplies and acquisitions.