Summary
Parties
Subject of the case
Grounds
Decision on costs
Operative part
Keywords

1 . FREE MOVEMENT OF GOODS - COMMUNITY TRANSIT - NATIONAL TRANSIT CHARGES - IMPERMISSIBILITY - CHARGES WHICH REPRESENT THE COSTS OF TRANSPORTATION OR OF OTHER SERVICES CONNECTED WITH TRANSIT - PERMISSIBILITY

2 . INTERNATIONAL AGREEMENTS - AGREEMENTS CONCLUDED BY THE COMMUNITY - AGREEMENT BETWEEN THE EEC AND THE REPUBLIC OF AUSTRIA ON THE APPLICATION OF THE RULES ON COMMUNITY TRANSIT - TAX TREATMENT OF GOODS IN TRANSIT - NO SPECIFIC COMMITMENT

( AGREEMENTS EEC-AUSTRIA OF 22 JUNE 1972 )

3 . INTERNATIONAL AGREEMENTS - AGREEMENTS CONCLUDED BY THE MEMBER STATES - GATT - PRINCIPLE OF FREEDOM OF TRANSIT - DIRECT EFFECT - NONE - NO EFFECT ON THE COMMUNITY ' S OBLIGATIONS TOWARDS NON-MEMBER STATES WHICH ARE PARTIES TO GATT

Summary

1 . THE EXISTENCE WITHIN THE COMMUNITY OF A CUSTOMS UNION CHARACTERIZED BY THE FREE MOVEMENT OF GOODS IMPLIES FREEDOM OF TRANSIT WITHIN THE COMMUNITY . THAT FREEDOM OF TRANSIT MEANS THAT A MEMBER STATE MAY NOT APPLY TO GOODS IN ITS TERRITORY IN TRANSIT TO OR FROM ANOTHER MEMBER STATE TRANSIT DUTIES OR OTHER CHARGES IMPOSED IN RESPECT OF TRANSIT . HOWEVER , THE IMPOSITION OF CHARGES OR FEES WHICH REPRESENT THE COSTS OF TRANSPORTATION OR OF OTHER SERVICES CONNECTED WITH TRANSIT CANNOT BE REGARDED AS INCOMPATIBLE WITH FREEDOM OF TRANSIT AS DEFINED ABOVE , BEARING IN MIND THAT IT IS NECESSARY TO TAKE ACCOUNT NOT ONLY OF DIRECT AND SPECIFIC SERVICES CONNECTED WITH THE MOVEMENT OF GOODS BUT ALSO OF THE MORE GENERAL BENEFITS DERIVED FROM THE USE OF HARBOUR WATERS OR INSTALLATIONS FOR THE NAVIGABILITY AND MAINTENANCE OF WHICH THE PUBLIC AUTHORITIES ARE RESPONSIBLE .

2 . THE TRANSIT AGREEMENT BETWEEN THE EEC AND AUSTRIA ON THE APPLICATION OF THE RULES ON COMMUNITY TRANSIT DOES NOT CONTAIN ANY SPECIFIC COMMITMENT BETWEEN THE PARTIES IN RELATION TO THE TAX TREATMENT OF GOODS IN TRANSIT .

3 . ARTICLE V OF THE GENERAL AGREEMENT ON TARIFFS AND TRADE , WHICH LAYS DOWN THE PRINCIPLE OF FREEDOM OF TRANSIT THROUGH THE TERRITORY OF EACH CONTRACTING PARTY FOR TRAFFIC IN TRANSIT TO OR FROM THE TERRITORY OF OTHER CONTRACTING PARTIES CANNOT HAVE DIRECT EFFECT IN THE FRAMEWORK OF COMMUNITY LAW AND INDIVIDUALS MAY NOT RELY UPON IT IN ORDER TO CHALLENGE THE IMPOSITION OF A CHARGE SUCH AS THE LOADING AND UNLOADING CHARGE ON GOODS IN TRANSIT TO AUSTRIA . THAT IN NO WAY AFFECTS THE COMMUNITY ' S OBLIGATION TO ENSURE THAT THE PROVISIONS OF GATT ARE OBSERVED IN ITS RELATIONS WITH NON-MEMBER STATES WHICH ARE PARTIES TO GATT .

Parties

IN CASE 266/81

REFERENCE TO THE COURT UNDER ARTICLE 177 OF THE EEC TREATY BY THE CORTE SUPREMA DI CASSAZIONE ( SUPREME COURT OF CASSATION ), ITALY , FOR A PRELIMINARY RULING IN THE PROCEEDINGS PENDING BEFORE THAT COURT BETWEEN

SOCIETA ITALIANA PER L ' OLEODOTTO TRANSALPINO ( SIOT ), WHOSE REGISTERED OFFICE IS IN TRIESTE ,

AND

MINISTERO DELLE FINANZE ( MINISTRY OF FINANCE ), MINISTERO DELLA MARINA MERCANTILE ( MINISTRY OF SHIPPING ), CIRCOSCRIZIONE DOGANALE DI TRIESTE ( TRIESTE CUSTOMS AUTHORITY ) AND ENTE AUTONOMO DEL PORTO DI TRIESTE ( TRIESTE INDEPENDENT PORT AUTHORITY ),

AND ALSO IN SIX OTHER ACTIONS , JOINED THERETO , WHICH INVOLVE THE SAME PARTIES OR SOME OF THEM , IN MAIN ACTIONS , CROSS-APPEALS AND INTERLOCUTORY PROCEEDINGS ,

Subject of the case

ON THE JURISDICTION OF THE COURT OF JUSTICE TO INTERPRET THE GENERAL AGREEMENT ON TARIFFS AND TRADE ( GATT ), THE EFFECTS OF THE SUBSTITUTION OF THE COMMUNITY FOR THE MEMBER STATES WITH REGARD TO THE FULFILMENT OF THE OBLIGATIONS LAID DOWN BY THAT AGREEMENT , THE EFFECT OF THE PROVISIONS OF GATT IN THE NATIONAL LEGAL ORDER , THE INTERPRETATION OF ARTICLE V ( 3 ) OF GATT , ARTICLES 90 ( 1 ) AND 113 ( 1 ) OF THE EEC TREATY AND ALSO OF REGULATIONS NO 542/69 OF THE COUNCIL OF 18 MARCH 1969 AND NO 2813/72 OF THE COUNCIL OF 21 NOVEMBER 1972 IN RELATION TO THE REVENUE CHARGE AND THE PORT CHARGE PROVIDED FOR BY DECREE-LAW NO 47 OF 28 FEBRUARY 1974 , CONVERTED INTO LAW NO 117 OF 16 APRIL 1974 , AND ON THE RIGHTS OF INDIVIDUALS IN THE EVENT OF THOSE CHARGES ' BEING ILLEGAL ,

Grounds

1 BY AN ORDER DATED 21 MAY 1981 , WHICH WAS RECEIVED AT THE COURT REGISTRY ON 6 OCTOBER 1981 , THE CORTE SUPREMA DI CASSAZIONE ( SUPREME COURT OF CASSATION ) REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER ARTICLE 177 OF THE EEC TREATY FOUR QUESTIONS CONCERNING :

ON THE ONE HAND , THE INTERPRETATION OF ARTICLES 90 , 113 AND 117 OF THE EEC TREATY , OF REGULATION NO 542/69 OF THE COUNCIL OF 18 MARCH 1969 ON COMMUNITY TRANSIT ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1969 ( I ), P.125 ) AND OF REGULATION NO 2813/72 OF THE COUNCIL OF 21 NOVEMBER 1972 ON THE CONCLUSION OF AN AGREEMENT BETWEEN THE EUROPEAN ECONOMIC COMMUNITY AND THE REPUBLIC OF AUSTRIA ON THE APPLICATION OF THE RULES ON COMMUNITY TRANSIT ( JOURNAL OFFICIEL L 294 , P . 86 ); AND

ON THE OTHER HAND , THE EFFECT WITHIN THE COMMUNITY OF THE GENERAL AGREEMENT ON TARIFFS AND TRADE ( GATT ) OF 30 OCTOBER 1947 AND THE INTERPRETATION OF ARTICLE V OF GATT ON FREEDOM OF TRANSIT .

THE CORTE SUPREMA DI CASSAZIONE PUT THE QUESTIONS IN ORDER TO ENABLE IT TO DETERMINE THE COMPATIBILITY WITH COMMUNITY LAW AND , IF NECESSARY , WITH THE RULES OF GATT OF THE APPLICATION OF CHARGES ON UNLOADING AND LOADING OF GOODS IMPOSED BY VIRTUE OF DECREE-LAW NO 47 OF 28 FEBRUARY 1974 , CONVERTED INTO LAW NO 117 OF 16 APRIL 1974 ( HEREINAFTER REFERRED TO AS ' ' DECREE-LAW NO 47 ' ' ), TO OIL CARRIED BY THE TRANSALPINE OIL PIPE-LINE TO THE FEDERAL REPUBLIC OF GERMANY AND THE REPUBLIC OF AUSTRIA .

2 IT APPEARS FROM THE FILE THAT THOSE QUESTIONS AROSE IN CONNECTION WITH A NUMBER OF DISPUTES BETWEEN , ON THE ONE HAND , SOCIETA ITALIANA PER L ' OLEODOTTO TRANSALPINO ( HEREINAFTER TO AS ' ' THE COMPANY ' ' ), A COMPANY GOVERNED BY ITALIAN LAW WHICH WAS RESPONSIBLE FOR THE CONSTRUCTION AND OPERATION OF THE SECTION OF THE TRANSALPINE OIL PIPE-LINE IN ITALIAN TERRITORY BETWEEN TRIESTE AND THE AUSTRIAN BORDER , AND , ON THE OTHER HAND , MINISTERO DELLE FINANZE ( MINISTRY OF FINANCE ), MINISTERO DELLE MARINA MERCANTILE ( MINISTRY OF SHIPPING ), CIRCOSCIRZIONE DOGANALE DI TRIESTE ( TRIESTE CUSTOMS AUTHORITY ) AND ENTE AUTONOMO DEL PORTO DI TRIESTE ( TRIESTE INDEPENDENT PORT AUTHORITY ) IN RELATION TO THE LEVYING OF THE CONTESTED CHARGES ON CRUDE OIL DISCHARGED INTO THE COMPANY ' S INSTALLATIONS FOR CONSIGNMENT TO REFINERIES IN THE FEDERAL REPUBLIC OF GERMANY AND THE REPUBLIC OF AUSTRIA .

BACKGROUND TO THE DISPUTE

3 IT SHOULD BE POINTED OUT THAT BEFORE THE APPLICATION OF THE DECREE-LAW TO WHICH THE DISPUTE RELATES ITALY IMPOSED UNDER LAW NO 82 OF 9 FEBRUARY 1963 AN UNLOADING CHARGE ON IMPORTED GOODS AND A CHARGE KNOWN AS A ' ' PORT CHARGE ' ' ON GOODS LOADED AND UNLOADED , REGARDLESS OF THEIR ORIGIN OR THEIR DESTINATION , IN SPECIFIED PORTS , INCLUDING THE PORT OF TRIESTE . THE FIRST OF THOSE CHARGES WAS NOT APPLICABLE TO OIL DISCHARGED BY THE COMPANY , BECAUSE IT WAS NOT INTENDED FOR IMPORTATION ; AS TO THE SECOND CHARGE , THE LAW CONTAINED AN EXPRESS EXEMPTION IN FAVOUR OF GOODS IN TRANSIT IN THE PORT OF TRIESTE .

4 IN ITS PRELIMINARY RULING OF 10 OCTOBER 1973 IN CASE 34/73 , VARIOLA V AMMINISTRAZIONE ITALIANA DELLE FINANZE , ( 1973 ) ECR 981 , THE COURT HELD THAT A CHARGE SUCH AS THE FIRST-MENTIONED , IMPOSED SPECIFICALLY ON IMPORTED PRODUCTS , WAS TO BE REGARDED AS A CHARGE HAVING AN EFFECT EQUIVALENT TO A CUSTOMS DUTY AND ACCORDINGLY WAS INCOMPATIBLE WITH COMMUNITY LAW . AT THE SAME TIME , THE COMMISSION HAD LODGED AN APPLICATION IN CONNECTION WITH THE UNLOADING CHARGE FOR A DECLARATION THAT ITALY HAD FAILED TO FULFIL ITS OBLIGATIONS AS A MEMBER STATE , WHICH WAS ENTERED IN THE COURT REGISTER UNDER NO 172/73 ( OFFICIAL JOURNAL 1973 , C 99 , P . 4 ). AS A RESULT OF THE JUDGMENT CITED , ITALY AMENDED ITS LEGISLATION BY DECREE-LAW NO 47 . THE UNLOADING CHARGE WAS REPLACED BY A STATE CHARGE ON UNLOADING AND LOADING , HEREINAFTER REFERRED TO AS THE ' REVENUE CHARGE ' , WHICH APPLIED REGARDLESS OF THE ORIGIN OR DESTINATION OF THE GOODS . THE COMMISSION CONSIDERED THAT , AS A RESULT OF THAT CHANGE IN THE CONTESTED CHARGE , THE FAILURE TO FULFIL OBLIGATIONS UNDER COMMUNITY LAW NO LONGER EXISTED AND CONSEQUENTLY IT WITHDREW ITS APPLICATION ( OFFICIAL JOURNAL 1974 , C 69 , P . 5 ). THE PORT CHARGE REMAINED IN FORCE IN ACCORDANCE WITH THE PROVISIONS OF THE LAW OF 1963 , APART FROM THE ABOLITION OF THE EXCEPTION PREVIOUSLY PROVIDED FOR IN FAVOUR OF TRANSIT THROUGH THE PORT OF TRIESTE .

5 AS FROM THE APPLICATION OF DECREE-LAW NO 47 , THE ITALIAN TAX AUTHORITY REQUIRED THE PAYMENT OF THE TWO CHARGES - THE REVENUE CHARGE AND THE PORT CHARGE - IN RESPECT OF CRUDE OIL DISCHARGED INTO THE COMPANY ' S INSTALLATIONS AND TRANSMITTED THROUGH THE TRANSALPINE OIL PIPE-LINE . THE COMPANY BROUGHT SEVERAL ACTIONS CHALLENGING THOSE CHARGES BEFORE THE TRIBUNALE ( DISTRICT COURT ), TRIESTE , IN RELATION TO PERIODS DURING 1974 AND 1975 . IT SUBSEQUENTLY PAID THE CHARGES WITHOUT PREJUDICE , PENDING THE OUTCOME OF THOSE ACTIONS . THE APPLICATIONS WERE DISMISSED BY THE TRIBUNALE , TRIESTE , AND THE COMPANY LODGED APPEALS BEFORE THE CORTE D ' APPELLO ( COURT OF APPEAL ), TRIESTE , WHICH IN TURN DISMISSED THE APPEALS IN SUCCESSIVE JUDGMENTS . AFTER THOSE JUDGMENTS , SEVERAL APPEALS IN CASSATION WERE BROUGHT BEFORE THE CORTE SUPREMA DI CASSAZIONE .

6 ACCORDING TO THE ORDER MAKING THE REFERENCE , THE COMPANY PUT FORWARD , IN ADDITION TO CERTAIN SUBMISSIONS BASED ON NATIONAL LAW , VARIOUS SUBMISSIONS BASED ON THE ONE HAND ON COMMUNITY LAW AND ON THE OTHER HAND ON GATT . IT ARGUED THAT THE CONTESTED CHARGES :

( 1 ) SHOULD BE CONSIDERED NOT AS INTERNAL TAXATION BUT AS CHARGES HAVING AN EFFECT EQUIVALENT TO CUSTOMS DUTIES , CONTRARY TO ARTICLES 12 AND 13 OF THE EEC TREATY ;

( 2 ) WERE INCOMPATIBLE WITH THE RULES ON FREEDOM OF TRANSIT PROVIDED FOR IN ARTICLE V OF GATT ;

( 3 ) WERE INCOMPATIBLE WITH THE COMMUNITY TRANSIT PROCEDURE AS DEFINED BY REGULATION NO 542/69 AND WITH THE TRANSIT AGREEMENT CONCLUDED BY THE COMMUNITY WITH AUSTRIA , WHICH WAS GIVEN EFFECT BY REGULATION NO 2813/72 ;

( 4 ) INTERFERED WITH THE COMMUNITY ' S COMMERCIAL POLICY AND THEREFORE INFRINGED ARTICLE 113 OF THE EEC TREATY ;

( 5 ) GAVE RISE TO SERIOUS DISTORTIONS OF COMPETITION , CONTRARY TO ARTICLE 90 ( 1 ) OF THE EEC TREATY , INASMUCH AS THEY SECURED FINANCIAL ADVANTAGES FOR PUBLIC PORT SERVICES , THE BURDEN OF WHICH WAS BORNE BY A PRIVATE UNDERTAKING AUTHORIZED TO OPERATE AND USE ITS OWN SERVICES FOR SIMILAR UNLOADING OPERATIONS .

7 THE CORTE SUPREMA DI CASSAZIONE , CONSIDERING THAT THE CHARGES IN QUESTION WERE TAXES LEVIED ON GOODS LOADED AND UNLOADED AND WERE IMPOSED ON ALL SUCH GOODS , REGARDLESS OF THEIR ORIGIN OR THEIR DESTINATION , TOOK THE VIEW THAT THE CONTESTED CHARGES WERE NOT IMPORT LEVIES BUT INTERNAL TAXATION WITHIN THE MEANING OF ARTICLE 95 OF THE TREATY AND ARTICLE III OF GATT .

8 ON THE BASIS OF THOSE CONSIDERATIONS , THE CORTE SUPREMA DI CASSAZIONE TOOK THE VIEW THAT PROBLEMS OF INTERPRETATION AROSE UNDER COMMUNITY LAW IN RELATION TO THE REGULATION ON COMMUNITY TRANSIT , THE TRANSIT AGREEMENT WITH AUSTRIA , THE RULES ON THE COMMON COMMERCIAL POLICY LAID DOWN IN ARTICLE 113 , AND THE RULES ON COMPETITION CONTAINED IN ARTICLE 90 OF THE TREATY .

9 IT ALSO CONSIDERS THAT A QUESTION ARISES IN RELATION TO THE ALLEGED INCOMPATIBILITY OF THE CONTESTED CHARGES WITH ARTICLE V OF GATT ON FREEDOM OF TRANSIT . SINCE THE CORTE SUPREMA DI CASSAZIONE AND THE COURT OF JUSTICE HAD EXPRESSED DIFFERENT VIEWS IN THEIR DECISIONS WITH REGARD TO THE INTERNAL EFFECTS OF GATT , AS IS SHOWN BY THE JUDGMENTS OF 12 DECEMBER 1972 IN JOINED CASES 21 TO 24/72 , INTERNATIONAL FRUIT COMPANY V PRODUKTSCHAP VOOR GROENTEN EN FRUIT ( 1972 ) ECR 1219 , OF 24 OCTOBER 1983 IN CASE 9/73 , SCHLUTER V HAUPTZOLLAMT LORRACH , ( 1973 ) ECR 1135 , AND OF 11 NOVEMBER 1975 IN CASE 38/75 NEDERLANDSE SPOORWEGEN V INSPECTEUR DER INVOERRECHTEN EN ACCIJNZEN , ( 1975 ) ECR 1439 , IT BELIEVES THAT IT IS NOW NECESSARY TO RECONSIDER THE PROBLEM , HAVING REGARD TO THE FACT THAT THE COMMUNITY HAS BEEN SUBSTITUTED FOR THE MEMBER STATES IN RELATION TO COMMITMENTS UNDER GATT , AS HAS BEEN AFFIRMED BY THE COURT OF JUSTICE IN THE JUDGMENTS CITED .

10 IN ORDER TO RESOLVE THOSE PROBLEMS , THE CORTE SUPREMA DI CASSAZIONE HAS FORMULATED FOUR QUESTIONS FOR A PRELIMINARY RULING . THEY ARE WORDED AS FOLLOWS :

( A ) AS A PRELIMINARY POINT :

SINCE THE COMMUNITY HAS BEEN SUBSTITUTED FOR