Important legal notice
Opinion of Mr Advocate General Darmon delivered on 9 January 1991. - Commission of the European Communities v Italian Republic. - Free movement of goods - Charge having equivalent effect to a customs duty - Services rendered simultaneously to several undertakings - Payment of an amount disproportionate to the cost of the service. - Case C-209/89.
European Court reports 1991 Page I-01575
Opinion of the Advocate-General
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Mr President,
Members of the Court,
1. In the present case the Commission seeks a declaration from the Court that the Italian Republic has failed to fulfil its obligations under Articles 9, 12, 13 and 16 of the EEC Treaty by requiring from each undertaking individually, where services are provided simultaneously to several undertakings in connection with the completion of customs formalities in intra-Community trade, payment of an amount disproportionate to the cost of the services provided.
2. It should be recalled first of all that the disputed Italian provisions relate to the charges payable by undertakings where customs formalities are completed outside the customs area or outside normal office hours.
3. Those rules provide that where services are rendered to several undertakings simultaneously, "the staff is entitled to a single payment, commensurate with the nature and duration of the most highly-paid service provided", and each undertaking must "pay separately the charges due for the services which it has requested, independently of the charges paid by the other undertakings". Consequently, where, for example, a service of 50 minutes' duration is provided simultaneously to five undertakings, each must pay the charge corresponding to one hour since it is not divisible.
4. According to the Commission, that method of calculation is in breach of the prohibition of charges having equivalent effect since it takes no account of the time actually employed by staff in providing the service sought by the undertakings concerned.
5. The Italian Republic disputes that analysis, pointing out in limine that the total annual receipts from the charges paid by traders are lower than the cost which providing the service to undertakings entails for the public purse. In its view, there is no alternative to the system. A "division" of the time employed would lead to a division of the hourly charge into derisory amounts which would ultimately be absorbed by the administrative costs of such a calculation. Furthermore, it would be impracticable to demand payment of the charge from a single undertaking. In its rejoinder, the Italian Government has emphasized that the amount of the hourly charge which undertakings are required to pay represents approximately one-third of the actual amount paid to staff per hour, so that the charge paid by undertakings is the equivalent in fact of a flat-rate payment for twenty minutes' work. That method complies with the principle of proportionality if account is taken of the average duration of each operation.
6. First of all, the Italian Republic maintains in its defence that the circumstances in which a service provided simultaneously to several undertakings gives rise to payment of several charges correspond to specific cases involving a number of small batches packed together in bulk consignments or awaiting "shipment", in respect of which, moreover, a request for customs services to be provided outside normal working hours or outside the customs area could hardly be justified on grounds of urgency. Apart from those cases, practically all of the formalities completed outside the customs area or outside normal working hours involve consignments of goods belonging to several owners shipped under the system known as "groupage", in which the carrier is treated as a single undertaking by the Italian rules which consequently impose a single charge. The Italian Republic thus appears to draw attention to the highly exceptional nature of the cases at issue and their minor significance.
7. The Commission denies that these are borderline cases and believes there to be an infringement even though the situations in question may be unusual.
8. I am entirely of the same opinion and would ask the Court not to endorse the existence of a de minimis rule which would restrict the scope of the prohibition on charges having equivalent effect.
9. Next, it should be pointed out that the oral procedure has clarified the circumstances in which a service can be "simultaneously" rendered to several undertakings. In fact the Commission explained that such is the case where consignors present themselves at customs and carry out at the same time the requisite formalities for several undertakings.
10. In such cases, may all the undertakings be required to pay the charge in respect of a full hour? In its case-law the Court (1) has long since established that only the amounts charged to traders by way of consideration for the provision of a service can escape the prohibition on charges having equivalent effect. Here, it is common ground that a service is provided for undertakings, but it is the method of calculation employed by the Italian authorities which is at issue.
11. It should be noted that a flat-rate assessment of the cost of an inspection, such as a fixed hourly rate, has been accepted by the Court in its case-law. (2) However, acceptance of a standard hourly rate certainly does not mean that the charge per hour may be applied on a flat-rate basis, irrespective of the time actually employed by the department concerned in customs clearance formalities. The method of calculation in force in Italy may lead, for example, to fifteen undertakings being required to pay an hour' s charge each for no more than half an hour' s work in all. In such a case the disputed system of calculation is manifestly arbitrary since it is wholly unrelated to the time actually employed by customs staff for the benefit of the undertakings concerned. In those circumstances the payment required bears no relation to the cost which the services provided entail for the Italian State.
12. As I have said, however, the Italian Republic claims that the hourly charge in fact represents only one-third of the amount which the authorities pay their officials in respect of overtime work.
13. On what basis does the defendant arrive at this conclusion? It is clear from the figures submitted by the Italian State itself that although the hourly charge which undertakings are required to pay does indeed correspond to one third of the rate of pay for overtime work (3) where the service is provided outside normal working hours within the customs area, (4) it represents two thirds of the rate for overtime where customs officials travel to the undertakings' premises. (5) No doubt the charges paid in the case of Guardia di Finanza officers completing formalities would be lower and, moreover, they would also receive various fees. In any event, however, the categorical statement that the hourly rate charged corresponds to the amount paid to officials in respect of only twenty minutes' work must, at the very least, be argued more cogently.
14. That observation serves, furthermore, to underline the complete lack of transparency which characterizes the system applied by Italy and the disproportionate consequences to which it may lead in certain cases to the detriment of undertakings, as the aforesaid example shows. Let me point out in that regard that, even if the assertion that the charge represents only one third of the cost per hour for the Italian finance authorities is true, the amount which undertakings are required to pay exceeds the real cost where more than three undertakings are involved simultaneously, a situation whose plausibility has not been disputed by the Italian State.
15. Clearly the Court cannot implicitly demand the introduction of an absurd system requiring a minute-by-minute, second-by-second, calculation of the time actually employed for the benefit of each undertaking. But neither does it seem at all unreasonable to divide the hourly charge by the number of undertakings involved. In my view, the elementary arithmetic which division calls for cannot entail an excessive administrative cost. The Italian State claims that the amounts which it could collect in those circumstances would be derisory. That argument does not stand up to close analysis. On the one hand, it suggests that undertakings must bear all the inconveniences of the system adopted by having to pay, if necessary, a charge which is out of all proportion to the cost of the service provided. On the other hand, and above all, it would be quite permissible for the Italian State to reassess the hourly charge if it did not reflect, as the defendant maintains, the actual cost entailed by an hour' s work employed in carrying out the operations at issue. In any event, it seems clear that the disputed rules are in breach of the principle of proportionality inasmuch as each undertaking is required to pay the charge provided for irrespective of the charges paid by the other undertakings.
16. The Court should therefore declare that the defendant has failed to fulfil its obligations and order it to pay the costs.
(*) Original language: French.
(1) Judgments in Case 46/76 Bauhuis [1977] ECR 5, Case 132/78 Denkavit [1979] ECR 1923 and Case 132/82 Commission v Belgium [1983] ECR 1643.
(2) Judgment in Case C-111/89 Bakker [1990] ECR I-1735, at paragraph 13.
(3) Lit 15 000 on average according to the Italian Government, see p. 3 of the defence.
(4) Lit 5 200, see defence, p. 2.
(5) Lit 10 200, ibid., p. 2.
Translation
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