Summary
Parties
Grounds
Decision on costs
Operative part
Keywords
++++
European Communities' own resources - Post-clearance recovery of import or export duties - Error on the part of the customs authorities arising from the use, for the purposes of calculating duties, of a purely indicative national tariff manual incorporating an anticipated reduction in duty which did not occur - Error detectable by the trader - Post-clearance recovery - Not possible to claim protection of legitimate expectations
( Council Regulation ( EEC ) No 1697/79, Art . 5(2 ) )
Summary
A trader is not entitled under Article 5(2 ) of Regulation No 1697/79 to the waiver of the post-clearance recovery of import duties if the error made by the customs authorities from which he benefited was due to the fact that those authorities, instead of applying the Community provisions relating to the customs tariff published in the Official Journal of the European Communities, referred to a national tariff manual which wrongly incorporated an anticipated reduction in duty proposed by the Commission but rejected by the Council, since it was an error which the trader could reasonably have detected within the meaning of that regulation .
Community provisions relating to the customs tariff constitute, from the date of their publication in the Official Journal of the European Communities, the sole relevant positive law, of which all are deemed to be aware . A tariff manual drawn up by national authorities constitutes no more than a handbook for customs clearance; it can have no more than indicative character and in no case lead to the calling in question of the primacy of Community law . Moreover, an error in relation to the rate of duty can be detected by an attentive trader from a reading of the Official Journal of the European Communities, in which the relevant provisions are published .
Furthermore, a commercial trader whose activities consist, essentially, of import-export operations cannot derive a legitimate expectation as to the applicable rate of duty merely from a Commission proposal incorporated in a national tariff manual, since it is not unreasonable to expect him to consult the relevant Official Journals .
Parties
In Case 161/88
REFERENCE to the Court under Article 177 of the EEC Treaty by the Finanzgericht ( Finance Court ) Munich for a preliminary ruling in the action pending before that court between
Friedrich Binder GmbH & Co . KG, a company incorporated under the laws of the Federal Republic of Germany, whose registered office is at Herrenberg,
and
Hauptzollamt ( Principal Customs Office ) Bad Reichenhall,
on the validity of the Commission' s decision of 5 November 1985 ( Document K(85)1732 final ) finding that there should be post-clearance recovery of import duties amounting to DM 22 917.83 in respect of frozen morello cherries originating in Yugoslavia and imported into the Federal Republic of Germany by three undertakings, one of which was Friedrich Binder GmbH & Co . KG, between 30 January and 5 March 1983,
THE COURT ( First Chamber )
composed of : R . Joliet, President of the Chamber, Sir Gordon Slynn and G . C . Rodríguez Iglesias, Judges,
Advocate General : M . Darmon
Registrar : D . Louterman, Principal Administrator
after considering the observations submitted on behalf of the Commission by J . Sack in the written procedure and at the hearing,
having regard to the Report for the Hearing and further to the hearing on 20 April 1989,
after hearing the Opinion of the Advocate General delivered at the sitting on 16 May 1989,
gives the following
Judgment
Grounds
1 By order dated 3 May 1988, which was received at the Court on 3 June 1988, the Finanzgericht Munich referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question as to the validity of a decision communicated on 5 November 1985 to the Federal Republic of Germany, in which the Commission found that there should be post-clearance recovery of import duties amounting to
DM 22 917.83 on certain imports effected by three German undertakings .
2 That question was raised in proceedings in which one of those three undertakings, Friedrich Binder GmbH & Co . KG, an import-export, forwarding and wholesaling company in the fruit and vegetable sector ( hereinafter referred to as "Binder "), seeks the annulment of three demands for post-clearance recovery of customs duties issued by the Hauptzollamt Bad Reichenhall ( hereinafter referred to as "the Hauptzollamt ").
3 The operations to which the demands related comprised the importation and bringing into free circulation in the Federal Republic of Germany, by Binder, of 12 consignments of frozen morello cherries originating in Yugoslavia between 30 January 1983 and 5 March 1983 .
4 At that time, the rate of duty applicable to the importation into the Community of morello cherries originating in Yugoslavia, which was 13%, had been laid down by Article 8 of the Interim Agreement between the European Economic Community and the Socialist Federal Republic of Yugoslavia on trade and trade cooperation, approved on behalf of the Community by Council Regulation ( EEC ) No 1272/80 of 22 May 1980 ( Official Journal 1980, L 130, p . 1 ). A proposal for a regulation providing for a reduction of that rate from 13% to 10.4% was presented by the Commission to the Council on 16 July 1982 .
5 That proposal was incorporated into the German Gebrauchs-Zolltarif ( customs tariff manual ) issued by the German authorities, as from 1 January 1983 . The Hauptzollamt therefore charged customs duty on the imports in question at a rate of 10.4 %.
6 The Commission' s proposal was not adopted by the Council, and, on 9 March 1983, the Federal Finance Ministry corrected the rate of customs duty shown in the Gebrauchs-Zolltarif as from 1 January 1983 by fixing it again at 13 %.
7 On 28 and 29 March and 13 June 1983, the Hauptzollamt issued three final notices requiring Binder to pay an amount corresponding to the balance due at the correct rate of duty, namely DM 7 992.39, on the basis of Article 2 of Council Regulation 1697/79 of 24 July 1979 on the post-clearance recovery of import or export duties which have not been required of the person liable for payment on goods entered for a customs procedure involving the obligation to pay such duties ( Official Journal 1979, L 197, p . 1 ). Binder then submitted an objection to those notices and sought the abandonment of the post-clearance recovery of the duties in question .
8 Article 5(2 ) of Council Regulation No . 1697/79 provides :
"The competent authorities may refrain from taking action for the post-clearance recovery of import duties or export duties which were not collected as a result of an error made by the competent authorities themselves which could not reasonably have been detected by the person liable, the latter having for his part acted in good faith and observed all the provisions laid down by the rules in force as far as his customs declaration is concerned ."
9 Since the amount of duty involved was greater than ECU 2 000, on 5 July 1985 the Federal Republic of Germany requested the Commission, in accordance with Article 4 of Commission Regulation ( EEC ) No 1573/80 of 20 June 1980 laying down provisions for the implementation of Article 5(2 ) of Council Regulation ( EEC ) No 1697/79 ( Official Journal 1980, L 161, p . 1 ), to decide whether, in the instant case, there was justification for waiving post-clearance recovery of the import duties in question under Article 5(2 ) of Council Regulation No 1697/79 .
10 On 5 November 1985, the Commission addressed a negative decision to the Federal Republic of Germany . In the grounds for its decision, it stated that the requirements set out in Article 5(2 ) of Regulation No 1697/79 were not fulfilled . The error made by the customs office with regard to the applicable rate of duty could reasonably have been detected by the person liable to pay duties inasmuch as it was clear from Article 8 of the Interim Agreement between the European Economic Community and the Socialist Federal Republic of Yugoslavia, approved on behalf of the Community by Regulation No 1272/80, that the appropriate rate of duty was 13 %. The importers were therefore in a position to find out the applicable rate of duty and to ascertain without difficulty that the rate published in the Gebrauchs-Zolltarif, a document issued for information purposes only which cannot be made to override the Official Journal of the European Communities, was incorrect .
11 On the basis of that decision, Binder' s objection was dismissed on 27 January 1986 . The company then sought, in an appeal to the Finanzgericht Munich, the annulment of the contested notices of post-clearance recovery . In support of its appeal, it claimed that it had relied on the information published in the Gebrauchs-Zolltarif, which was an official document, that it had based its calculations on a rate of duty of 10.4% and could thus not pass on to its customers the duty charged after clearance and that it could not be expected to be better acquainted with the rates of customs duty in force than the competent customs authorities .
12 The Finanzgericht considered that the validity of the Commission' s decision of 5 November 1985 was doubtful, stayed the proceedings and referred the following question to the Court for a preliminary ruling :
"Is the Commission' s decision of 5 November 1985 ( Document K(85 ) 1732 final ) valid?"
13 It is clear from the order for reference that the doubts expressed as to the validity of the Commission' s decision relate principally to the correctness of the Commission' s finding that Binder could have ascertained without difficulty that the rate published in the Gebrauchs-Zolltarif was wrong . In that regard, the Finanzgericht refers in particular to the difficulty in consulting the Official Journal of the European Communities in the district covered by the customs office in question since it was not available there . It also points out that it is the practice of all those concerned to rely on the Gebrauchs-Zolltarif, a document which is particularly dependable because it is published by the Federal Finance Ministry, which takes part in the drafting of the Community' s tariff regulations . The national court concludes that the Federal Finance Ministry thereby aroused expectations on the part of importers of the goods at issue to which the Commission in its decision of 5 November 1985 did not give consideration .
14 Reference is made to the Report for the Hearing for a fuller account of the applicable provisions of Community law, the course of the procedure and the observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court .
15 It must be borne in mind first of all that Article 5(2 ) of Regulation No 1697/79 lays down the following three requirements which must all be fulfilled before the competent authorities may waive post-clearance recovery :
( i ) the non-collection of the duties must be the result of an error made by the competent authorities themselves;
( ii ) the error must not have reasonably been detectable by the person liable, the latter having acted in good faith; and, finally,
( iii ) the person liable must have observed all the provisions laid down by the rules in force as far as his customs declaration is concerned .
16 As the Court ruled in its judgment of 22 October 1987 in Case 314/85 Foto-Frost v Hauptzollamt Luebeck-Ost (( 1987 )) ECR 4199, that provision must be interpreted as meaning that if all those requirements are fulfilled the person liable is entitled to the waiver of the recovery of the duty in question .
17 In its decision of 5 November 1985, the Commission considered that the second requirement was not fulfilled . It must therefore be determined whether the Commission was justified in finding that the error made by the customs office could reasonably have been detected by the person liable within the meaning of Article 5(2 ) of Regulation No 1697/79 .
18 The Commission has submitted, in that connection, that the Gebrauchs-Zolltarif is purely indicative and cannot therefore be made to override the Official Journal of the European Communities, which contains the applicable Community legislation, without calling into question the direct applicability and uniform application of the Common Customs Tariff and without giving a national tariff manual pre-eminence over the applicable Community customs regulations . A trader relying on such a declaratory document must therefore accept the risk that there might be a discrepancy between that document and the applicable Community legislation .
19 It must first be pointed out in that regard that the applicable Community provisions relating to the customs tariff must be published in the Official Journal of the European Communities . From the date of that publication, they constitute the sole relevant positive law, of which all are deemed to be aware . A tariff manual such as the Gebrauchs-Zolltarif, drawn up by national authorities, therefore constitutes, as is clear from the terms of its table of contents, no more than a handbook for customs clearance . It brings together, for the convenience of all those involved in customs operations, the rules of national law and Community law, including the Common Customs Tariff, which is cited as one of the fundamental provisions . The statements in the tariff manual therefore clearly indicate that it is merely a compilation of rules which, in so far as they form part of Community law, have previously been published in the Official Journal of the European Communities . Such a document can therefore have no more than indicative character and in no case lead to the calling in question of the primacy of Community law .
20 Furthermore, an error in relation to the rate of duty such as that involved in the present case could have been detected by an attentive trader from a reading of the Official Journal of the European Communities in which Council Regulation No 1272/80 was published . It must also be emphasized that the rate of 13% is the rate in force since that regulation was adopted and that any raising or lowering of that rate would have been published in the Official Journal of the European Communities .
21 Consideration must also be given to Binder' s assertion, taken up by the national court, that the existence of a Commission proposal to reduce, from 13% to 10.4%, the rate of customs duty applicable to imports into the Community of Morello cherries originating in Yugoslavia and the incorporation of that rate in the Gebrauchs-Zolltarif by the German authorities taking part in the drawing up of the Community' s tariff regulations gave rise to a legitimate expectation on its part that the rate of 10.4% was correct and that the Commission did not give consideration to that factor when reaching its decision .
22 In that regard, it must be pointed out that Binder is a commercial trader whose activities essentially consist of import-export operations . Such a company cannot derive a legitimate expectation as to the applicable rate of duty from the fact that a Commission proposal exists in which that rate appears and from the fact that it was incorporated in a national tariff manual . It does not, therefore, appear unreasonable to expect that trader to ascertain, by reading the relevant Official Journals, the Community duty applicable to the operations which he carries out, even if in the present case the rate in question applied only to products originating in Yugoslavia and had been laid down in an international trade agreement concluded by the Community with Yugoslavia .
23 It follows from the foregoing that the Commission was right in considering that the second requirement laid down in Article 5(2 ) of Regulation No 1697/79 was not fulfilled in the present case inasmuch as Binder could reasonably have detected the abovementioned error .
24 The answer to be given to the national court must therefore be that consideration of the question submitted to the Court has disclosed no factor of such a kind as to affect the validity of the Commission' s decision of 5 November 1985 ( Document K(85)1732 final ) addressed to the Federal Republic of Germany .
Decision on costs
Costs
25 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable . Since these proceedings are, in so far as the parties to the main proceedings 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 question submitted to it by the Finanzgericht, Munich, by order of 3 May 1988, hereby rules :
Consideration of the question submitted to the Court has disclosed no factor of such a kind as to affect the validity of the Commission' s decision of 5 November 1985 ( Document K(85)1732 final ) addressed to the Federal Republic of Germany .
Full & Egal Universal Law Academy