Summary
Parties
Subject of the case
Grounds
Decision on costs
Operative part
Keywords
COMMON CUSTOMS TARIFF - TARIFF HEADINGS - FISH-LIVER OIL , ACYCLIC HYDROCARBON - CLASSIFICATION UNDER SUBHEADING 29.01 A - END USE OF THE GOODS - FAVOURABLE TARIFF ARRANGEMENT ( SUBHEADING 29.01 A II ) - LACK OF AUTHORIZATION - NOT PERMISSIBLE
( COMMISSION REGULATION NO 1535/77 , ART . 3 , AND NO 1775/77 )
Summary
A COMPLETELY HYDROGENATED ANIMAL OIL , MANUFACTURED FROM FISH LIVER , WHICH IS AT THE SAME TIME AN ACYCLIC HYDROCARBON , MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A OF THE COMMON CUSTOMS TARIFF .
IN THE ABSENCE OF THE AUTHORIZATION PROVIDED FOR BY COMMISSION REGULATION NO 1775/77 OF 4 JULY 1977 DETERMINING THE CONDITIONS UNDER WHICH CERTAIN PETROLEUM PRODUCTS ARE ELIGIBLE UPON IMPORTATION FOR A FAVOURABLE TARIFF ARRANGEMENT BY REASON OF THEIR END USE , SUCH A PRODUCT CANNOT BE CLASSIFIED UNDER SUBHEADING 29.01 A II AND MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A I .
REFERENCE TO THE COURT UNDER ARTICLE 177 OF THE EEC TREATY BY THE TARIEFCOMMISSIE ( ADMINISTRATIVE COURT OF LAST INSTANCE IN REVENUE MATTERS ), AMSTERDAM , FOR A PRELIMINARY RULING IN THE PROCEEDINGS PENDING BEFORE THAT COURT BETWEEN
Parties
GERLACH & CO . BV , AMSTERDAM ,
AND
INSPECTEUR DER INVOERRECHTEN EN ACCIJNZEN ( INSPECTOR OF CUSTOMS AND EXCISE ), AMSTERDAM ,
Subject of the case
ON THE INTERPRETATION OF SUBHEADING 29.01 A OF THE COMMON CUSTOMS TARIFF AND COMMISSION REGULATION NO 1775/77 OF 28 JULY 1977 DETERMINING THE CONDITIONS UNDER WHICH CERTAIN PETROLEUM PRODUCTS ARE ELIGIBLE UPON IMPORTATION FOR A FAVOURABLE TARIFF ARRANGEMENT BY REASON OF THEIR END-USE ( OFFICIAL JOURNAL L 195 , P . 5 ),
Grounds
1 BY ORDER OF 16 MARCH 1983 , WHICH WAS RECEIVED AT THE COURT ON 24 MARCH 1983 , THE TARIEFCOMMISSIE , AMSTERDAM , REFERRED TO THE COURT , PURSUANT TO ARTICLE 177 OF THE EEC TREATY , TWO PRELIMINARY QUESTIONS RELATING TO THE INTERPRETATION OF TARIFF HEADING 29.01 A OF THE COMMON CUSTOMS TARIFF AND OF COMMISSION REGULATION NO 1775/77 OF 28 JULY 1977 DETERMINING THE CONDITIONS UNDER WHICH CERTAIN PETROLEUM PRODUCTS ARE ELIGIBLE ON IMPORTATION FOR A FAVOURABLE TARIFF ARRANGEMENT BY REASON OF THEIR END-USE ( OFFICIAL JOURNAL , L 195 , P . 5 ).
2 ON 8 AUGUST 1980 , GERLACH & CO . BV , THE PLAINTIFF IN THE MAIN ACTION , DECLARED THE IMPORTATION FOR HOME USE OF GOODS , MADE IN AND COMING FROM SPAIN , WHICH IT DESCRIBED AS ' ' FISH-LIVER OIL , TARIFF SUBHEADING 15.04 A II ' ' . THE CUSTOMS AUTHORITIES FIRST ACCEPTED THAT CLASSIFICATION , UNDER WHICH NO IMPORT DUTY IS PAYABLE .
3 ON THE BASIS OF SAMPLES , THE OFFICIAL CONCERNED CONSIDERED THAT THE IMPORTED GOODS SHOULD BE CLASSIFIED UNDER SUBHEADING 29.01 A I AS ' ' ACYCLIC HYDROCARBONS ' ' WHICH , BEING OF SPANISH ORIGIN , WERE LIABLE , AT THE TIME OF IMPORTATION , TO A 6.7% AD VALOREM DUTY .
4 AN OBJECTION BY THE COMPANY TO THE DECISION TO CLASSIFY THE GOODS UNDER SUBHEADING 29.01 A I WAS REJECTED AND THE COMPANY THEN BROUGHT AN ACTION BEFORE THE TARIEFCOMMISSIE , CLAIMING THAT THE ACYCLIC HYDROCARBON COMPOUNDS FALLING WITHIN THAT SUBHEADING MUST BE DERIVED FROM MINERAL HYDROCARBONS . IN THIS CASE THE PRODUCT WAS OF ANIMAL ORIGIN AND SHOULD THEREFORE BE CLASSIFIED IN SUBHEADING 15.04 A II .
5 THE INSPECTOR OF CUSTOMS AND EXCISE , AMSTERDAM , THE DEFENDANT IN THE MAIN ACTION , CONTENDED THAT THE PRODUCT NO LONGER DISPLAYED , AT THE TIME OF IMPORTATION , THE OUTWARD CHARACTERISTICS OF FISH OIL AND THAT AS A RESULT OF THE PROCESSING WHICH IT HAD UNDERGONE , HAD BECOME A CHEMICALLY DEFINED COMPOUND , NAMELY AN ACYCLIC HYDROCARBON COVERED BY SUBHEADING 29.01 A . EVEN THOUGH THE GOODS WERE PROBABLY NOT INTENDED TO BE USED AS POWER OR HEATING FUELS WITHIN THE MEANING OF SUBHEADING 29.01 A I , THEY SHOULD BE CLASSIFIED UNDER THAT SUBHEADING BECAUSE THE IMPORTING COMPANY HAD NOT SOUGHT THE AUTHORIZATION ALLOWING THE MORE FAVOURABLE CLASSIFICATION UNDER SUBHEADING 29.01 A II , NAMELY , AS AN ACYCLIC HYDROCARBON , INTENDED FOR OTHER PURPOSES .
6 CONSIDERING THAT THE DECISION IN THE MAIN ACTION DEPENDED UPON THE INTERPRETATION OF COMMUNITY LAW , THE TARIEFCOMMISSIE REFERRED THE FOLLOWING QUESTIONS TO THE COURT :
' ' 1 . UNDER WHICH HEADING OF THE COMMON CUSTOMS TARIFF SHOULD A COMPLETELY HYDROGENATED ANIMAL OIL WHICH IS MANUFACTURED FROM FISH LIVER AND IS AT THE SAME TIME AN ACYCLIC HYDROCARBON COMPOUND BE CLASSIFIED?
2.IF A PRODUCT OF THE KIND REFERRED TO IN QUESTION 1 IS TO BE CLASSIFIED UNDER SUBHEADING 29.01 A OF THE COMMON CUSTOMS TARIFF , DOES SUB HEADING I OR II APPLY WHERE , ALTHOUGH THE PRODUCT IS INTENDED TO BE USED OTHERWISE THAN AS A POWER OR HEATING FUEL , NO AUTHORIZATION WITHIN THE MEANING OF COMMISSION REGULATION ( EEC ) NO 1775/77 OF 28 JULY HAS BEEN OBTAINED?
' '
7 IN THE ORDER REFERRING THESE QUESTIONS TO THE COURT , THE TARIEFCOMMISSIE CONSIDERS THAT NOT ONLY SHOULD HEADINGS AND SUBHEADINGS 15.04 AND 29.01 A , PUT FORWARD BY THE PARTIES , BE TAKEN INTO ACCOUNT , BUT ALSO HEADING 15.12 .
8 THE FIRST QUESTION THEREFORE ASKS UNDER WHICH OF THESE THREE HEADINGS THE GOODS IN QUESTION SHOULD BE CLASSIFIED .
9 HEADING 15.04 COVERS FATS AND OILS , OF FISH AND MARINE MAMMALS , WHETHER OR NOT REFINED . ACCORDING TO THE EXPLANATORY NOTES TO THE CUSTOMS COOPERATION COUNCIL ' S NOMENCLATURE , THAT HEADING COVERS OILS AND FATS DERIVED FROM FISH AND MARINE MAMMALS WHICH ARE EXTRACTED FROM THE BODY OR LIVER OF THE FISH OR FROM FISH WASTE , AND WHICH USUALLY HAVE A CHARACTERISTIC FISHY SMELL AND A DISAGREEABLE TASTE . THEIR NATURAL COLOUR MAY VARY FROM YELLOW TO REDDISH-BROWN . WHEN REFINED FATS AND OILS DERIVED FROM FISH OR MARINE MAMMALS HAVE BEEN HYDROGENATED , SOLIDIFIED OR HARDENED BY ANY PROCESS , THEY ARE CLASSIFIED UNDER HEADING 15.12 . THAT HEADING COVERS ANIMAL OR VEGETABLE OILS AND FATS , WHOLLY OR PARTLY HYDROGENATED , OR SOLIDIFIED OR HARDENED BY ANY OTHER PROCESS , WHETHER OR NOT REFINED , BUT NOT FURTHER PREPARED .
10 IN ITS ORDER FOR REFERENCE , THE TARIEFCOMMISSIE FOUND THAT THE PRODUCT IN QUESTION WAS TRANSPARENT , COLOURLESS AND ODOURLESS AND THAT IT MUST BE REGARDED AS COMPLETELY HYDROGENATED . THAT FACT IS SUFFICIENT TO CONCLUDE THAT THE GOODS CANNOT BE COVERED BY HEADING 15.04 .
11 NEITHER CAN THE GOODS IN QUESTION BE CLASSIFIED UNDER HEADING 15.12 , SINCE THEY MUST HAVE BEEN PREPARED IN ORDER TO BECOME A COLOURLESS AND ODOURLESS PRODUCT AND THAT ONLY PRODUCTS WHICH HAVE BEEN HYDROGENATED BUT NOT FURTHER PREPARED ARE COVERED BY HEADING 15.12 .
12 HEADING 20.01 IS FORMULATED IN THE FOLLOWING TERMS :
' ' HYDROCARBONS :
A . ACYCLIC : ' '
ACCORDING TO NOTE 1 ( A ) TO CHAPTER 29 , THE HEADINGS OF THE CHAPTER ARE TO BE TAKEN AS APPLYING TO ' ' SEPARATE ' ' CHEMICALLY DEFINED ORGANIC COMPOUNDS , WHETHER OR NOT CONTAINING IMPURITIES ' ' . FURTHERMORE , THE EXPLANATORY NOTES TO THE CUSTOMS TARIFF OF THE EUROPEAN COMMUNITIES SAY , IN RELATION TO CHAPTER 29 , THAT
' ' THE PRODUCTS BELOW ARE CLASSIFIED IN THIS CHAPTER WHEN THEY SATISFY THE FOLLOWING CRITERIA AS TO PURITY :
. . .
6 . ETHANE AND OTHER SATURATED ACYCLIC HYDROCARBONS ( OTHER THAN METHANE AND PROPANE ), SINGLE ISOMERS NOT LESS THAN 95% PURE ON THE ANHYDROUS PRODUCT , CALCULATED BY REFERENCE TO VOLUME FOR GASEOUS PRODUCTS AND TO WEIGHT FOR NON-GASEOUS PRODUCTS . ' '
13 THE REPLY TO THE FIRST QUESTION MUST THEREFORE BE THAT A COMPLETELY HYDROGENATED ANIMAL OIL , MANUFACTURED FROM FISH LIVER , WHICH IS AT THE SAME TIME AN ACYCLIC HYDROCARBON , MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A OF THE COMMON CUSTOMS TARIFF .
14 IN ITS SECOND QUESTION , THE TARIEFCOMMISSIE ENQUIRES IF A PRODUCT CLASSIFIED UNDER SUBHEADING 29.01 A FALLS UNDER SUBHEADING 29.01 A I OR SUBHEADING 29.01 A II WHEN IT IS INTENDED TO BE USED OTHERWISE THAN AS A POWER OR HEATING FUEL , BUT WHERE NO AUTHORIZATION WITHIN THE MEANING OF COMMISSION REGULATION ( EEC ) NO 1775/77 HAS BEEN OBTAINED .
15 SUBHEADING 29.01 A IS DIVIDED INTO TWO SUBHEADINGS AS FOLLOWS :
' ' I . FOR USE AS POWER OR HEATING FUELS
II . FOR OTHER PURPOSES ( A ). ' '
PRODUCTS CLASSIFIED UNDER SUBHEADING 29.01 A II MAY BE IMPORTED FREE OF DUTY .
ACCORDING TO FOOTNOTE ( A ) RELATING TO THE SECOND SUBHEADING :
' ' ENTRY UNDER THIS SUBHEADING IS SUBJECT TO CONDITIONS TO BE DETERMINED BY THE COMPETENT AUTHORITIES . ' '
16 SUCH CONDITIONS WERE DETERMINED BY THE COMMISSION IN REGULATION NO 1775/77 ( OFFICIAL JOURNAL , L 195 , P . 5 ) WHICH STATES THAT COMMISSION REGULATION NO 1535/77 OF 4 JULY 1977 DETERMINED THE CONDITIONS UNDER WHICH CERTAIN GOODS WERE ELIGIBLE UPON IMPORTATION FOR A FAVOURABLE TARIFF ARRANGEMENT BY REASON OF THEIR END-USE . ARTICLE 3 OF THE LATTER REGULATION PROVIDES THAT THE BENEFIT OF THE FAVOURABLE TARIFF ARRANGEMENT IS CONDITIONAL UPON THE GRANT OF A WRITTEN AUTHORIZATION BY THE COMPETENT AUTHORITIES . THE TARIEFCOMMISSIE FOUND THAT THE PLAINTIFF IN THE MAIN ACTION DID NOT OBTAIN SUCH AN AUTHORIZATION .
17 THE OBLIGATION TO OBTAIN A WRITTEN AUTHORIZATION FROM THE COMPETENT AUTHORITIES IS DESIGNED TO FACILITATE THE TASK OF THE CUSTOMS AUTHORITIES AND TO AVOID FRAUD . IN THE INTEREST OF LEGAL CERTAINTY AND THE SMOOTH FUNCTIONING OF THE ADMINISTRATION , THE PROCEDURE PROVIDED FOR IN THE COMMUNITY RULES MUST BE FOLLOWED .
18 CONSEQUENTLY , THE REPLY TO THE SECOND QUESTION MUST BE THAT A PRODUCT CANNOT BE CLASSIFIED UNDER SUBHEADING 29.01 A II WHERE AN AUTHORIZATION WITHIN THE MEANING OF REGULATION NO 1775/77 HAS NOT BEEN OBTAINED .
19 AS A RESULT , THE PRODUCT REFERRED TO IN THE SECOND QUESTION CANNOT BE CLASSIFIED UNDER SUBHEADING 29.01 A II , AND MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A I .
Decision on costs
COSTS
20 THE COSTS INCURRED BY THE GOVERNMENT OF THE KINGDOM OF BELGIUM AND BY THE COMMISSION OF THE EUROPEAN COMMUNITIES , WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE . AS THE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED , IN THE NATURE OF A STEP IN THE ACTION PENDING BEFORE THE NATIONAL COURT , THE DECISION ON COSTS IS A MATTER FOR THAT COURT .
Operative part
ON THOSE GROUNDS ,
THE COURT ( FIRST CHAMBER )
IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE TARIEFCOMMISSIE , AMSTERDAM , BY ORDER OF 16 MARCH 1983 , HEREBY RULES :
1 . A COMPLETELY HYDROGENATED ANIMAL OIL , MANUFACTURED FROM FISH LIVER , WHICH IS AT THE SAME TIME AN ACYCLIC HYDROCARBON , MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A OF THE COMMON CUSTOMS TARIFF .
2.IN THE ABSENCE OF THE AUTHORIZATION PROVIDED FOR BY COMMISSION REGULATION NO 1775/77 OF 4 JULY 1977 ( OFFICIAL JOURNAL , L 195 , P . 5 ), SUCH A PRODUCT MUST BE CLASSIFIED UNDER SUBHEADING 29.01 A I .
Full & Egal Universal Law Academy