CELEX: 61982CJ0162
Free movement of goods
Country of origin of cotton yarn

1 BY A JUDGMENT OF 15 MARCH 1982 WHICH REACHED THE COURT ON 28 MAY 1982 THE TRIBUNAL DE POLICE ( LOCAL COURT WITH MINOR CRIMINAL JURISDICTION ), STRASBOURG , PURSUANT TO ARTICLE 177 OF THE EEC TREATY REFERRED TO THE COURT OF JUSTICE FOR A PRELIMINARY RULING A QUESTION CONCERNING THE INTERPRETATION OF ARTICLE 30 OF THE EEC TREATY AND THE VALIDITY OF COMMISSION REGULATION ( EEC ) NO 749/78 OF 10 APRIL 1978 ON THE DETERMINATION OF THE ORIGIN OF TEXTILE PRODUCTS FALLING WITHIN CHAPTERS 51 AND 53 TO 62 OF THE COMMON CUSTOMS TARIFF ( OFFICIAL JOURNAL , L 101 , P . 7 ) TO ENABLE IT TO ASSESS THE COMPATIBILITY WITH COMMUNITY LAW OF CRIMINAL PROCEEDINGS FOR FALSE DECLARATIONS OF ORIGIN ON THE IMPORTATION OF COTTON YARN .
2 THOSE PROCEEDINGS WERE BROUGHT AGAINST A GERMAN SUPPLIER OF COTTON YARN AND ITS REPRESENTATIVE IN FRANCE , TWO FRENCH CUSTOMERS OF THAT SUPPLIER AND ALSO THE CUSTOMS AGENTS WHO HAD BEEN ENTRUSTED WITH CARRYING OUT THE CUSTOMS FORMALITIES FOR VARIOUS IMPORTS OF COTTON YARN FROM THE FEDERAL REPUBLIC OF GERMANY INTO FRANCE , FOR INFRINGEMENT OF THE PROVISIONS OF FRENCH CUSTOMS LEGISLATION WHICH , FOR THE COMPILATION OF CUSTOMS STATISTICS , REQUIRE A DECLARATION IN CUSTOMS FORMS OF THE ORIGIN OF IMPORTED GOODS .
3 THE SUPPLIER OF COTTON YARN , WUPPERTALER GARNBLEICHEREI UND FARBEREI EDUARD GOEBEL ( HEREINAFTER REFERRRED TO AS ' ' GOEBEL ' ' ) OF WUPPERTAL IN THE FEDERAL REPUBLIC OF GERMANY , MADE DELIVERIES OVER A PERIOD OF SEVERAL YEARS AND IN PARTICULAR BETWEEN 1978 AND OCTOBER 1980 OF COTTON YARN NOT PUT UP FOR RETAIL SALE FALLING UNDER TARIFF HEADING 55.05 B II OF THE COMMON CUSTOMS TARIFF , TO VARIOUS FRENCH CUSTOMERS INCLUDING ETABLISSEMENTS TRICOTAGE MECANIQUE DE MARMOUTIER SA AND ALLENBACH SA , BOTH ESTABLISHED     IN FRANCE . THE CUSTOMS DECLARATION FORMS WERE PREPARED BY CUSTOMS AGENTS INCLUDING WOEHL , HEPPNER AND SEEGMULLER , COMPANIES ACTING ON THE INSTRUCTIONS OF GOEBEL . THE GAVE THE FEDERAL REPUBLIC OF GERMANY AS THE COUNTRY OF ORIGIN .
4 IN THE COURSE OF A SUBSEQUENT INVESTIGATION THE FRENCH CUSTOMS AUTHORITIES ESTABLISHED THAT GOEBEL , AN UNDERTAKING IN THE TEXTILE FINISHING INDUSTRY , HAD PURCHASED UNBLEACHED COTTON YARN , MAINLY IN EGYPT AND THE UNITED STATES , AND AFTER IT HAD BEEN PUT INTO FREE CIRCULATION IN THE FEDERAL REPUBLIC OF GERMANY , SUBJECTED IT TO VARIOUS FINISHING PROCESSES NAMELY DYEING AND USUALLY ALSO GASSING AND MERCERIZING PRIOR TO SELLING IT TO THE CONSUMERS . THE FRENCH CUSTOMS AUTHORITIES TOOK THE VIEW THAT THESE PROCESSES DID NOT ENABLE THE FEDERAL REPUBLIC OF GERMANY TO BE REGARDED AS THE COUNTRY OF ORIGIN OF THE COTTON YARN UNDER COMMISSION REGULATION ( EEC ) NO 749/78 AND BROUGHT PROCEEDINGS BEFORE VARIOUS TRIBUNAUX DE POLICE AGAINST GOEBEL AND THE VARIOUS COMPANIES AND PERSONS CONNECTED WITH THE IMPORTS IN QUESTION .
5 IN ONE SUCH CASE , THE TRIBUNAL DE POLICE , TROYES , HELD THAT THE PROCESSES CARRIED OUT BY GOEBEL WERE SUBSTANTIAL PROCESSES WHICH GAVE THE YARN GERMAN ORIGIN AND THEREFORE DISCHARGED THE ACCUSED . THE TRIBUNAL DE POLICE , TOURCOING , IN ANOTHER PROSECUTION , IMPOSED 106 FINES OF 200 FRENCH FRANCS EACH ON GOEBEL AND ITS DIRECTOR FOR EACH CASE OF IMPORTATION OF YARN , AND 106 FINES OF 300 FRANCS EACH ON THE CUSTOMS AGENTS CONCERNED , FOR WHICH , MOREOVER , GOEBEL AND ITS DIRECTOR WERE DECLARED JOINTLY LIABLE , WHILST THE CHARGES AGAINST THE FRENCH IMPORTERS WERE DISMISSED .
6 THE TRIBUNAL DE POLICE , STRASBOURG , WHICH ALSO HAD BEFORE IT SUCH A PROSECUTION WITHIN THE FRAMEWORK OF THE PRINCIPAL PROCEEDINGS , SUBMITTED THE FOLLOWING QUESTION TO THE COURT FOR A PRELIMINARY RULING :
' ' ON A PROPER INTERPRETATION OF THE EEC TREATY , IN PARTICULAR ARTICLE 30 THEREOF , MUST THE REQUIREMENT LAID DOWN IN ARTICLES 1 AND 2 OF COMMISSION REGULATION ( EEC ) NO 749/78 OF 10 APRIL 1978 FOR CONFERRING UPON CERTAIN TEXTILE PRODUCTS THE LEGAL STATUS , IN RELATION TO THE CUSTOMS PROVISIONS , OF PRODUCTS ORIGINATING IN A MEMBER STATE OF THE EEC BE REGARDED AS A MEASURE EQUIVALENT TO A QUANTITATIVE RESTRICTION?
' '
THE RELEVANT COMMUNITY RULES
7 ARTICLE 5 OF REGULATION ( EEC ) NO 802/68 OF THE COUNCIL OF 27 JUNE 1968 ON THE COMMON DEFINITION OF THE CONCEPT OF THE ORIGIN OF GOODS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1968 ( I ), P . 165 ) PROVIDES THAT :
' ' A PRODUCT IN THE PRODUCTION OF WHICH TWO OR MORE COUNTRIES WERE CONCERNED SHALL BE REGARDED AS ORIGINATING IN THE COUNTRY IN WHICH THE LAST SUBSTANTIAL PROCESS OR OPERATION THAT IS ECONOMICALLY JUSTIFIED WAS PERFORMED , HAVING BEEN CARRIED OUT IN AN UNDERTAKING EQUIPPED FOR THE PURPOSE AND RESULTING IN THE MANUFACTURE OF A NEW PRODUCT OR REPRESENTING AN IMPORTANT STAGE OF MANUFACTURE . ' '
ARTICLE 14 OF THAT REGULATION GIVES THE COMMISSION THE POWER TO ADOPT THE NECESSARY PROVISIONS FOR THE IMPLEMENTATION OF THE SAID ARTICLE 5 , IN ACCORDANCE WITH A PROCEDURE LAID DOWN IN PARAGRAPHS ( 2 ) AND ( 3 ) OF THAT ARTICLE AND FOLLOWING AN OPINION OF THE COMMITTEE ON ORIGIN .
8 IN EXERCISE OF THAT POWER , THE COMMISSION PROVIDED BY REGULATION NO 749/78 THAT THE TEXTILE PRODUCTS ALLUDED TO IN THAT REGULATION WERE TO BE CONSIDERED AS ORIGINATING IN A COUNTRY OR IN THE COMMUNITY IF THEY HAD UNDERGONE ONE COMPLETE PROCESS AS SPECIFIED IN ARTICLE 2 . THAT ARTICLE PROVIDES :
' ' THE FOLLOWING SHALL BE CONSIDERED AS COMPLETE WORKING OR PROCESSING :
( A ) WORKING OR PROCESSING AS A RESULT OF WHICH THE PRODUCTS OBTAINED RECEIVE A CLASSIFICATION UNDER A TARIFF HEADING OTHER THAN THOSE COVERING THE VARIOUS PRODUCTS UTILIZED EXCEPT , HOWEVER , WORKING OR PROCESSING SPECIFIED IN LIST A , WHERE THE SPECIAL PROVISIONS OF THAT LIST SHALL APPLY ;
( B)WORKING OR PROCESSING SPECIFIED IN LIST B . ' '
9 THAT PROVISION IS SUPPLEMENTED BY THE TWO LISTS A AND B ANNEXED TO THE REGULATION . LIST A ENUMERATES THE WORKING OR PROCESSING OPERATIONS WHICH RESULT IN A CHANGE IN TARIFF HEADING WITHOUT CONFERRING ON THE PRODUCTS UNDERGOING THEM THE STATUS OF ORIGINATING PRODUCTS OR CONFERRING THAT STATUS ONLY SUBJECT TO CERTAIN CONDITIONS . ON THE OTHER HAND , LIST B SETS OUT THE WORKING OR PROCESSING OPERATIONS WHICH DO NOT LEAD TO A CHANGE IN TARIFF HEADING BUT WHICH DO CONFER ON THE PRODUCTS UNDERGOING THEM THE STATUS OF     ORIGINATING PRODUCTS . THE PRODUCT IN ISSUE , NAMELY COTTON YARN NOT PUT UP FOR RETAIL SALE UNDER HEADING 55.05 OF THE COMMON CUSTOMS TARIFF , APPEARS ONLY IN LIST A WITH THE SUPPLEMENTARY CONDITION TO THE BASIC RULE FOR CONFERRING ORIGIN : ' ' MANUFACTURE FROM PRODUCTS FALLING WITHIN HEADING NO 55.01 OR 55.03 ' ' , NAMELY COTTON OR COTTON WASTE ( INCLUDING PULLED OR GARNETTED RAGS ), NOT CARDED OR COMBED .
10 COTTON YARN NOT PUT UP FOR RETAIL SALE WHETHER UNBLEACHED YARN OR GASSED , MERCERIZED AND DYED YARN ALL FALL UNDER TARIFF HEADING 55.05 OF THE COMMON CUSTOMS TARIFF . IT FOLLOWS THAT THE PROCESSES OF GASSING , MERCERIZING AND DYEING DO NOT HAVE THE EFFECT OF PLACING THE PRODUCT THEREBY OBTAINED UNDER A TARIFF HEADING OTHER THAN THAT RELATING TO THE BASIC PRODUCT . SINCE SUCH PROCESSES CARRIED OUT ON UNBLEACHED YARN DO NOT APPEAR IN ANNEX B TO REGULATION NO 749/78 THAT REGULATION THERFORE PREVENTS SUCH PROCESSES FROM CONFERRING A NEW ORIGIN ON COTTON YARN .
11 IT SHOULD BE ADDED THAT , AS APPEARS FROM GOEBEL ' S OBSERVATIONS , THE GERMAN ORIGIN OF COTTON YARN DELIVERED BY IT WAS NEVER DISPUTED PRIOR TO THE ENTRY INTO FORCE OF REGULATION NO 749/78 , AND THAT IT WAS ONLY AFTER IT CAME INTO FORCE THAT THE FRENCH AUTHORITIES BROUGHT PROCEEDINGS UNDER THAT REGULATION FOR FALSE DECLARATIONS OF ORIGIN .
12 IN THIS CONTEXT , AS APPEARS FROM THE JUDGMENT OF REFERENCE , THE QUESTION PUT BY THE TRIBUNAL DE POLICE , STRASBOURG , IN ESSENCE SEEKS TO ESTABLISH , FIRST , WHETHER COMMISSION REGULATION ( EEC ) NO 749/78 IS VALID INASMUCH AS IT PREVENTS THE PROCESSES OF GASSING , MERCERIZING AND DYEING FROM CONFERRING COMMUNITY ORIGIN ON UNBLEACHED COTTON YARN IMPORTED FROM NON-MEMBER COUNTRIES , AND , SECONDLY , WHETHER ARTICLE 30 OF THE EEC TREATY IS TO BE INTERPRETED AS MEANING THAT PROCEEDINGS BROUGHT PURSUANT TO THAT REGULATION FOR FALSE DECLARATIONS OF ORIGIN CONSTITUTE MEASURES HAVING AN EFFECT EQUIVALENT TO QUANTITATIVE RESTRICTIONS ON IMPORTS AND THAT IT IMPOSES LIMITS ON THE PENALTIES WHICH MAY BE IMPOSED IN SUCH PROCEEDINGS .
THE VALIDITY OF REGULATION NO 749/78
13 ACCORDING TO THE PERSONS ACCUSED , COMMISSION REGULATION NO 749/78 IS INVALID INASMUCH AS IT PRECLUDES THE ACQUISITION OF COMMUNITY ORIGIN AS A RESULT OF THE PROCESSES IN ISSUE . ON THE ONE HAND THAT PROVISION IS SAID TO BE CONTRARY TO ARTICLE 30 OF THE EEC TREATY AND , ON THE OTHER HAND , BY ADOPTING IT , THE COMMISSION HAS EXCEEDED THE POWERS WHICH IT DERIVES FROM REGULATION ( EEC ) NO 802/68 OF THE COUNCIL .
14 THE COMMISSION , SUPPORTED BY THE ITALIAN GOVERNMENT , CLAIMS THAT IT HAS MADE A LEGITIMATE AND CORRECT USE OF ITS POWER TO INTERPRET THE VAGUE TERMS OF ARTICLE 5 OF REGULATION NO 802/68 BY ADOPTING A SIMPLE AND CLEAR CRITERION WHICH , MOREOVER , IS IN CONFORMITY WITH THE CRITERIA LAID DOWN IN COMMISSION REGULATION ( EEC ) NO 2966/77 OF 23 DECEMBER 1977 ( OFFICIAL JOURNAL , L 350 , P . 1 ), ON THE DEFINITION OF THE CONCEPT OF ORIGINATING PRODUCTS FOR PURPOSES OF THE APPLICATION OF TARIFF PREFERENCES GRANTED BY THE EUROPEAN ECONOMIC COMMUNITY IN RESPECT OF CERTAIN PRODUCTS FROM DEVELOPING COUNTRIES . REGULATION NO 749/78 INVOLVES NO OBSTACLE TO TRADE IN PRODUCTS IN FREE CIRCULATION WITHIN THE COMMUNITY AND IS NOT THEREFORE CONTRARY TO ARTICLE 30 OF THE EEC TREATY .
15 ON THIS MATTER IT MUST FIRST BE POINTED OUT , AS THE COURT HAS STATED IN ITS JUDGMENTS OF 31 JANUARY 1979 ( CASES 34/78 YOSHIDA NEDERLAND V KAMER VAN KOOPHANDEL EN FABRIEKEN VOOR FRIESLAND ( 1979 ) ECR 115 AND 114/78 YOSHIDA V INDUSTRIE- UND HANDELSKAMMER KASSEL ( 1979 ) ECR 151 ), THAT IN ADOPTING IMPLEMENTING PROVISIONS PURSUANT TO ARTICLE 14 OF COUNCIL REGULATION ( EEC ) NO 802/68 , THE COMMISSION IS OBLIGED NOT TO EXCEED THE POWERS WHICH THE COUNCIL HAS CONFERRED UPON IT FOR THE IMPLEMENTATION OF THE RULES WHICH IT HAS PROMULGATED IN THAT REGULATION AND , MORE PRECISELY , THAT IT MUST DEFINE SPECIFIC CRITERIA OF ORIGIN WHICH COMPLY WITH THE OBJECTIVE CRITERIA OF ARTICLE 5 OF REGULATION ( EEC ) NO 802/68 OF THE COUNCIL WHICH IS THE LEGAL BASIS OF THE IMPLEMENTING REGULATION AND THE SOURCE OF THE POWERS WHICH THE COMMISSION EXERCISES IN ADOPTING IT .
16 SINCE THE SPECIFIC CRITERIA OF ORIGIN ADOPTED BY THE COMMISSION IN REGULATION NO 749/78 WERE DRAWN , IN THE FIRST INSTANCE , FROM THE TARIFF CLASSIFICATION OF     PROCESSED PRODUCTS IT SHOULD BE BORNE IN MIND , AS THE COURT HAS STATED IN ITS JUDGMENT OF 26 JANUARY 1977 IN CASE 49/76 GESELLSCHAFT FUR UBERSEEHANDEL V HANDELSKAMMER HAMBURG ( 1977 ) ECR 41 , THAT FOR THE PURPOSES OF THE APPLICATION OF REGULATION NO 802/68 IT IS NOT SUFFICIENT TO SEEK CRITERIA DEFINING THE ORIGIN OF GOODS IN THE TARIFF CLASSIFICATION OF PROCESSED PRODUCTS , SINCE THE COMMON CUSTOMS TARIFF HAS BEEN CONCEIVED TO FULFIL SPECIAL PURPOSES AND NOT IN RELATION TO THE DETERMINATION OF THE ORIGIN OF PRODUCTS . ON THE CONTRARY , IN ORDER TO MEET THE PURPOSES AND REQUIREMENTS OF REGULATION NO 802/68 THE DETERMINATION OF THE ORIGIN OF GOODS MUST BE BASED ON A REAL AND OBJECTIVE DISTINCTION BETWEEN RAW MATERIAL AND PROCESSED PRODUCT , DEPENDING FUNDAMENTALLY ON THE SPECIFIC MATERIAL QUALITIES OF EACH OF THOSE PRODUCTS .
17 HOWEVER , THOSE PRINCIPLES DO NOT PREVENT THE COMMISSION , IN EXERCISING THE POWER CONFERRED UPON IT BY THE COUNCIL FOR THE IMPLEMENTATION OF ARTICLE 5 OF REGULATION NO 802/68 , FROM HAVING A MARGIN OF DISCRETION WHICH ALLOWS IT TO DEFINE THE ABSTRACT CONCEPTS OF THAT PROVISION WITH REFERENCE TO SPECIFIC WORKING OR PROCESSING OPERATIONS . THE COMMISSION HAS TAKEN THE CHANGE OF TARIFF HEADING ONLY AS A BASIC RULE , JUSTIFIED ON THE ONE HAND BY THE NEED FOR LEGAL CERTAINTY AND ON THE OTHER HAND BY THE PROBLEMS OF DEFINITION IN MULTIPLE ECONOMIC CIRCUMSTANCES . IT HAS SUPPLEMENTED AND ADAPTED THAT BASIC RULE BY LISTS A AND B , MENTIONED EARLIER , IN ORDER TO TAKE INTO ACCOUNT THE PARTICULAR FEATURES OF SPECIFIC WORKING OR PROCESSING OPERATIONS . THE CHOICE OF SUCH A METHOD IS NOT IN ITSELF INCOMPATIBLE WITH ARTICLE 5 OF REGULATION NO 802/68 .
18 IN THIS CASE , IT IS COMMON GROUND THAT REGULATION NO 749/78 PREVENTS THE OPERATIONS IN ISSUE , WHEN CARRIED OUT ON UNBLEACHED YARN , FROM CONFERRING ON IT THE STATUS OF AN ORIGINATING PRODUCT . ON THE OTHER HAND LIST B , WHICH SETS OUT THE WORKING OR PROCESSING OPERATIONS WHICH CONFER ON THE PRODUCT UNDERGOING THEM THE STATUS OF ORIGINATING PRODUCTS WITHOUT A CHANGE IN THE TARIFF HEADING , INCLUDES ' ' PRINTING OR DYEING ACCOMPANIED BY FINISHING OPERATIONS ( BLEACHING , DRESSING , . . . IMPREGNATING , SANFORIZING , MERCERIZING ) OF UNBLEACHED FABRICS INCLUDING KNITTED AND CROCHETED FABRICS ' ' . SIMILARLY REGULATION ( EEC ) NO 1039/71 OF THE COMMISSION OF 24 MAY 1971 ON DETERMINING THE ORIGIN OF CERTAIN WOVEN TEXTILE PRODUCTS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( I ), P . 274 ) WHOSE PROVISIONS HAVE BEEN REPLACED BY THOSE OF REGULATION NO 749/78 , HAD ALREADY PROVIDED THAT     ' ' DYEING , IF IT IS ACCOMPANIED BY ANY FINISHING OPERATION WHICH HAS THE EFFECT OF RENDERING THE DYED PRODUCTS DIRECTLY USABLE ' '  WOULD BE AN OPERATION CONFERRING THE STATUS OF ORIGINATING PRODUCTS ON FABRICS INCLUDING KNITTED AND CROCHETED FABRICS .
19 THAT APPRAISAL RELATING TO DYEING ACCOMPANIED BY OTHER CLOTH AND FABRIC FINISHING OPERATIONS IS IN STARK CONTRAST WITH THE RIGOROUSNESS OF THE CRITERIA FOR DETERMINING THE ORIGIN FOR COTTON YARN . IN FACT , NOT ONLY DOES COTTON YARN NOT APPEAR IN LIST B , BUT IT IS MENTIONED IN LIST A IN SUCH A WAY THAT , TO ENABLE IT TO BE REGARDED AS ORIGINATING IN A COUNTRY , IT MUST EVEN HAVE BEEN MADE THERE FROM COTTON OR COTTON WASTE WHICH HAS NOT BEEN CARDED OR COMBED .
20 THE COMMISSION HAS PROVIDED NO EXPLANATION RELATING TO THE NATURE OF THE PRODUCTS AND THE PROCESSES IN QUESTION WHICH MIGHT JUSTIFY SUCH A DIFFERENCE IN TREATMENT BETWEEN THE PROCESS OF DYEING AND OTHER FINISHING OPERATIONS CARRIED OUT ON CLOTH AND FABRICS ON THE ONE HAND AND ON COTTON YARN ON THE OTHER .
21 IN THESE CIRCUMSTANCES , IT APPEARS CONTRADICTORY AND DISCRIMINATORY FOR REGULATION NO 749/78 TO PROVIDE SUBSTANTIALLY MORE SEVERE CRITERIA FOR THE DETERMINATION OF THE ORIGIN OF COTTON YARN THAN FOR THE DETERMINATION OF THE ORIGIN OF CLOTHS AND FABRICS . ALTHOUGHT THE COMMISSION POSSESSES A DISCRETIONARY POWER FOR THE APPLICATION OF THE GENERAL CRITERIA CONTAINED IN ARTICLE 5 OF REGULATION NO 802/68 TO SPECIFIC WORKING OR PROCESSING OPERATIONS IT CANNOT HOWEVER , IN THE ABSENCE OF OBJECTIVE JUSTIFICATION , ADOPT ENTIRELY DIFFERENT SOLUTIONS FOR SIMILAR WORKING OR PROCESSING OPERATIONS .
22 IT IS THEREFORE NECESSARY TO DECLARE THAT COMMISSION REGULATION ( EEC ) NO 749/78 OF 10 APRIL 1978 ON THE DETERMINATION OF THE ORIGIN OF TEXTILE PRODUCTS FALLING WITHIN CHAPTERS 51 AND 53 TO 62 OF THE COMMON CUSTOMS TARIFF IS INVALID IN SO FAR AS IT PROVIDES THAT THE PROCESSES OF DYEING , ACCOMPANIED WHERE APPROPRIATE BY MERCERIZING AND GASSING , ARE NOT TO CONFER ON UNBLEACHED COTTON YARN THE STATUS OF A PRODUCT ORIGINATING IN THE COUNTRY WHERE THOSE PROCESSES TOOK PLACE .
23 IN THOSE CIRCUMSTANCES IT IS NO LONGER NECESSARY TO CONSIDER WHETHER THAT REGULATION IS COMPATIBLE WITH ARTICLE 30 OF THE EEC TREATY .
24 FURTHERMORE , IN SO FAR AS THE QUESTION PUT BY THE TRIBUNAL DE POLICE , STRASBOURG , SEEKS THE INTERPRETATION OF ARTICLE 30 OF THE EEC TREATY IN ORDER TO DETERMINE WHETHER PROCEDINGS BROUGHT BY THE NATIONAL AUTHORITIES UNDER REGULATION NO 749/78 ARE COMPATIBLE WITH THAT ARTICLE AND WHETHER IT IMPOSES LIMITS ON THE PENALTIES WHICH MAY BE IMPOSED IN SUCH PROCEEDINGS , THAT QUESTION IS DEVOID OF PURPOSE , REGARD BEING HAD TO THE FACT THAT THE DECLARATION THAT THE REGULATION IS INVALID , IN SO FAR AS THE WORKING OR PROCESSING OPERATIONS IN ISSUE ARE CONCERNED , PREVENTS ITS APPLICATION BY THE NATIONAL AUTHORITIES WITHIN THE LIMITS OF THE SCOPE OF THAT DECLARATION OF INVALIDITY . IT IS THEREFORE NO LONGER NECESSARY TO REPLY TO THAT PART OF THE QUESTION SUBMITTED .
Decision on costs
COSTS
25 THE COSTS INCURRED BY THE ITALIAN GOVERNMENT AND BY THE COMMISSION OF THE EUROPEAN COMMUNITIES , WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE . AS THESE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN PROCEDINGS ARE CONCERNED , IN THE NATURE OF A STEP IN THE PROSECUTION PENDING BEFORE THE NATIONAL COURT , THE DECISION ON COSTS IS A MATTER FOR THAT COURT .
Operative part
ON THOSE GROUNDS ,
THE COURT ( FIFTH CHAMBER ),
IN ANSWER TO THE QUESTION PUT TO IT BY THE TRIBUNAL DE POLICE , STRASBOURG , IN A JUDGMENT OF 15 MARCH 1982 , HEREBY RULES :
COMMISSION REGULATION ( EEC ) NO 749/78 OF 10 APRIL 1978 ON THE DETERMINATION OF THE ORIGIN OF TEXTILE PRODUCTS FALLING WITHIN CHAPTERS 51 AND 53 TO 62 OF THE COMMON CUSTOMS TARIFF ( OFFICIAL JOURNAL , L 101 , P . 7 ) IS INVALID IN SO FAR AS IT PROVIDES THAT DYEING PROCESSES , ACCOMPANIED     WHERE APPROPRIATE BY MERCERIZING AND GASSING , ARE NOT TO CONFER ON UNBLEACHED COTTON YARN THE STATUS OF A PRODUCT ORIGINATING IN THE COUNTRY WHERE THOSE PROCESSES TOOK PLACE .