CELEX: 62000CJ0389
Failure to fulfil obligations
Articles 23 and 25 EC
Charge having an equivalent effect
Export of waste
Basle Convention
Regulation No 259/93
Contribution to a solidarity fund

By an application lodged at the Court Registry on 20 October 2000, the Commission brought an action under Article 226 EC for
a declaration that, by enacting the Gesetz über die Überwachung und Kontrolle der grenzüberschreitenden Verbringung von Abfällen
(Abfallverbringungsgesetz) (Act on the supervision and control of transboundary shipments of waste;
the waste shipment act) of 30 September 1994, BGBl. 1994 I, p. 2771, (
the AbfVerbrG) establishing a solidarity fund for the return of waste and requiring exporters of waste, including those exporting to other
Member States, to contribute to that fund, the Federal Republic of Germany has failed to fulfil its obligations under Articles
23 and 25 EC.
Legal framework
The Basle Convention and Community law
Under Articles 23 EC and 25 EC, the Community is based upon a customs union which is to cover all trade in goods and which
is to involve the prohibition between Member States of customs duties on imports and exports and of all charges having equivalent
effect.
Shipments of waste within, into and out of the Community are subject to Council Regulation (EEC) No 259/93 of 1 February 1993
on the supervision and control of shipments of waste within, into and out of the European Community (OJ 1993 L 30, p. 1).
Shipments of waste which are excluded from the scope of application of that regulation are laid down in Article 1(2) and (3).
Regulation No 259/93 implements
inter alia
the obligations undertaken by the Community and the Member States in their capacity as parties to the Basle Convention of
22 March 1989 on the control of transboundary movements of hazardous wastes and their disposal (
the Basle Convention). That convention was approved on behalf of the Community by Council Decision 93/98/EEC of 1 February 1993 (OJ 1993 L 39,
p. 1). In addition to the Community, all of the Member States are parties to the Basle Convention.
Under Article 4(5) of the Basle Convention, the parties thereto are not to permit hazardous wastes or other wastes to be exported
to a non-party State or to be imported from a non-party State. Exceptions to this rule are nevertheless provided for in Article
11 of the convention, subject to certain conditions.
Article 8 of the Basle Convention lays down an obligation for the State of export to ensure that, when a transboundary movement
of hazardous wastes or other wastes to which the consent of the States concerned has been given cannot be completed in accordance
with the terms of the contract, the wastes in question are taken back into the State of export by the exporter if alternative
arrangements cannot be made for their disposal in an environmentally sound manner within 90 days.
Article 9(2)(a) of the Basle Convention provides that, in case of a transboundary movement of hazardous wastes or other wastes
deemed to be illegal traffic as the result of conduct on the part of the exporter or generator, the State of export is to
ensure that the wastes in question are taken back by the exporter or the generator or, if necessary, by itself into its territory.
The obligation to return laid down in Article 8 of the Basle Convention has been implemented in the Community legal order
by Article 25(1) of Regulation No 259/93, which reads as follows: Where a shipment of waste to which the competent authorities concerned have consented cannot be completed in accordance with
the terms of the consignment note or the contract referred to in Articles 3 and 6, the competent authority of dispatch shall,
within 90 days after it has been informed thereof, ensure that the notifier returns the waste to its area of jurisdiction
or elsewhere within the State of dispatch unless it is satisfied that the waste can be disposed of or recovered in an alternative
and environmentally sound manner.
Article 26(2)(a) of Regulation No 259/93 transposes in the following terms the obligation to return waste as laid down in
Article 9(2) of the Basle Convention:  If such illegal traffic is the responsibility of the notifier of the waste, the competent authority of dispatch shall ensure
that the waste in question is:
(a)
taken back by the notifier or, if necessary, by the competent authority itself ... .
In addition, Article 27(1) of Regulation No 259/93 provides: All shipments of waste covered within the scope of this Regulation shall be subject to the provision of a financial guarantee
or equivalent insurance covering costs for shipment, including cases referred to in Articles 25 and 26, and for disposal or
recovery.
As regards the allocation of administrative costs and costs associated with shipments, disposal or recovery of waste, Article
33 of Regulation No 259/93 states:
1.
Appropriate administrative costs of implementing the notification and supervision procedure and usual costs of appropriate
analyses and inspections may be charged to the notifier.
2.
Costs arising from the return of waste, including shipment, disposal or recovery of the waste in an alternative and environmentally
sound manner pursuant to Articles 25(1) and 26(2), shall be charged to the notifier or, if impracticable, to the Member States
concerned.
3.
Costs arising from disposal or recovery in an alternative and environmentally sound manner pursuant to Article 26(3) shall
be charged to the consignee.
4.
Costs arising from disposal or recovery, including possible shipment pursuant to Article 26(4), shall be charged to the notifier
and/or the consignee depending upon the decision by the competent authorities involved.
National rules
Paragraph 8(1) of the AbfVerbrG establishes a solidarity fund for the return of waste (Solidarfonds Abfallrückführung;
the solidarity fund).
The sixth and seventh sentences of that provision read as follows: In order to cover the payments and administrative costs of the solidarity fund, notifiers within the meaning of Regulation
[No 259/93] are required to contribute to this fund proportionally to the type and quantity of waste to be shipped. Contributions
which have not yet been used at the end of a three-year period shall be repaid
pro rata
to the contributors after prior payment of the additional cover under Paragraph 8(2).
The first sentence of Paragraph 8(2) of the AbfVerbrG reads as follows: In so far as the means which the solidarity fund must provide ... are insufficient to cover the costs incurred for the return
and non-harmful recovery or disposal in a manner in keeping with the general interest, the Länder shall be required, following
deduction of a federal portion to be determined by regulation ... to complete the cover according to an allocation formula
established on the basis of population and tax revenues (Königstein formula) or according to another formula agreed to by
the Länder.
The obligation to contribute to the solidarity fund is in addition to the obligation imposed on the notifier by Paragraph
7(1) of the AbfVerbrG to provide a financial guarantee or proof of equivalent insurance covering costs for shipment, in accordance
with Article 27 of Regulation No 259/93.
Paragraph 17 of the Verordnung über die Anstalt Solidarfonds Abfallrückführung (regulation on the solidarity fund for the
return of waste) of 20 May 1996, BGBl. 1996 I, p. 694, (
the solidarity fund regulation) provides that the obligation to contribute arises at the same time as the duty to give notice of waste to be shipped out
of the Federal Republic of Germany. Article 18 of the same regulation lays down the methods for calculating the contributions
which amount to DEM 0.30, DEM 3.00, DEM 10.00 or DEM 15.00 per tonne, depending on the type of waste involved.
Pre-litigation procedure
By letter of formal notice of 25 May 1998, the Commission informed the German authorities that it was of the view that the
contributions to the solidarity fund collected pursuant to the AbfVerbrG constituted a charge having equivalent effect to
an export customs duty prohibited by Articles 9 and 12 of the EC Treaty (now, after amendment, Articles 23 EC and 25 EC).
It added that such a contribution was not provided for by Regulation No 259/93.
In their response dated 11 September 1998, the German authorities maintained that the contribution to the solidarity fund
was proportionate payment for a definite and/or specific benefit conferred on economic operators and therefore not a charge
having equivalent effect to a customs duty. The German Government added that the specific characteristics of waste justified
certain restrictions on the free movement of goods of that type.
On 16 August 1999, the Commission sent a reasoned opinion to the Federal Republic of Germany in which it dismissed the arguments
of the German authorities, stating, however, that it did not object to the contribution paid in respect of exports of waste
from Germany to third countries. It invited Germany to comply with the reasoned opinion within two months of its notification.
In a letter of 21 January 2000, the German Government continued to maintain that it had not infringed the Treaty, whereupon
the Commission decided to bring the present action.
Infringement
The Commission claims that the obligation imposed by the AbfVerbrG on all exporters of waste to contribute to a solidarity
fund is partially incompatible with Community law. It submits that, since the contribution must be paid when waste is shipped
to other Member States, it constitutes a charge having effect equivalent to an export customs duty prohibited by Articles
23 EC and 25 EC.
As the Court has held on a number of occasions, the justification for the prohibition of customs duties and any charges having
an equivalent effect lies in the fact that any pecuniary charge, however small, imposed on goods by reason of the fact that
they cross a frontier, constitutes an obstacle to the movement of goods which is aggravated by the resulting administrative
formalities. It follows that any pecuniary charge, whatever its designation and mode of application, which is imposed unilaterally
on goods by reason of the fact that they cross a frontier and is not a customs duty in the strict sense constitutes a charge
having an equivalent effect to a customs duty within the meaning of Articles 23 EC and 25 EC,  even if it is not imposed on
behalf of the State (see,
inter alia
, Case 158/82
Commission
v
Denmark
[1983] ECR 3573, paragraph 18; and Case 18/87
Commission
v
Germany
[1988] ECR 5427, paragraph 5).
However, the Court has also held that such a charge escapes that classification if it relates to a general system of internal
dues applied systematically and in accordance with the same criteria to domestic products and imported products alike, if
it constitutes payment for a service in fact rendered to the economic operator of a sum in proportion to the service, or again,
subject to certain conditions, if it attaches to inspections carried out to fulfil obligations imposed by Community law (see
Commission
v
Germany
, cited above, paragraph 6, and case-law cited).
It is common ground that, in the present case, the mandatory contribution to the solidarity fund constitutes a pecuniary charge,
the amount of which is determined according to the nature and quantity of waste to be shipped, in accordance with the sixth
sentence of Paragraph 8(1) of the AbfVerbrG. Under that provision, read together with section 17 of the solidarity fund regulation,
any person required to notify of a shipment of waste within the meaning of Regulation No 259/93 must contribute to the fund
and that obligation arises at the same time as the duty to notify of a shipment of waste outside the territory of the Federal
Republic of Germany.
The German Government acknowledges that the disputed contribution appears to be a
charge having equivalent effect within the meaning of the Court's case-law. It denies, however, that the contribution is a charge prohibited by Articles
23 EC and 25 EC.
According to the German Government, the contribution to the solidarity fund is, first, adequate payment for the services actually
provided to specific economic operators. Second, it is a lawful charge because it is compensation for a measure required of
Member States by Community law with a view to promoting the free movement of goods. In this light and in two ways, the disputed
charge thus comes within the exceptions allowed in the case-law of the Court which allow for certain pecuniary charges not
to be charges having equivalent effect to a customs duty.
The contribution to the solidarity fund as payment for a service provided to economic operators
The German Government essentially submits that the State provides a financial service to the economic operators by agreeing,
in accordance with the relevant provisions of the Basle Convention and Regulation No 259/93, to guarantee the financing of
the return of waste into its territory in the event of illegal or incomplete exports, when the party responsible is not in
a position to bear the costs thereof or cannot be identified. This service confers a real benefit on operators which export
waste from the territory of the Federal Republic of Germany, since the subsidiary guarantee taken on by the State allows them
to penetrate the markets of the other Member States of the Community and also the other States-Parties to the Basle Convention.
According to the German Government, although the money from the solidarity fund is used for the return of illegally exported
waste, only those operators who export waste legally and contribute to the fund derive a benefit from the State's guarantee
for the return. This service provided by the State confers a specific benefit on each exporter of waste, which can avail itself
of the export possibilities created by the guarantee for each legal operation notified in accordance with Regulation No 259/93.
In addition, the amount of the contribution collected for each given export, determined according to the nature and quantity
of waste to be shipped, is itself proportional, within the meaning of that term as held by the Court in its case-law, to the
actual service provided to the operator. Each notifier's contribution is thus collected by way of payment for its making use
of the export opportunity created by the guarantee for the return of the waste.
The German Government stresses that the contribution provided for in Paragraph 8 of the AbfVerbrG is aimed precisely at covering
the costs incurred in providing the financing guarantee which makes each shipment of waste out of Germany possible. Consequently,
it is proper that the actual cost of this service be passed on in an equitable and proportional manner to the economic operators
which benefit from it.
The Court notes that the argument of the German Government is based on the hypothesis that the opportunities economic operators
established in Germany have to export waste may be largely attributed to the State's agreeing to provide a subsidiary guarantee
for the financing of waste return operations, when they become necessary.
The Court finds, however, that the opportunities those economic operators have are no different from those enjoyed by their
competitors established in other Member States.
Waste shipments out of Germany must comply with the same rules and are subject to the same conditions as those applicable
to shipments out of other Member States, since those rules and conditions are provided for
inter alia
in Regulation No 259/93. Even for exports to other States which are party to the Basle Convention (although the contributions
for those exports are not directly concerned by these proceedings), the opportunities for operators established in Germany
are identical to those enjoyed by other Community exporters, since the Community and all the Member States are party to that
convention and the obligations flowing therefrom are implemented in the Community legal order through Regulation No 259/93.
It is, moreover, not disputed that, in agreeing to bear the costs associated with the return of waste, including shipment
and disposal or recovery when those costs cannot be charged to a given operator, the Federal Republic of Germany is merely
complying with an obligation imposed uniformly on all Member States by Article 33(2) of Regulation No 259/93.
As pointed out by the Advocate General in paragraph 37 of his Opinion, compliance with that obligation helps to ensure that
no transboundary movement of waste is undertaken without adequate guarantees in place for protection of the environment and
health. The same objective is pursued by many other obligations imposed on the States of export by various provisions of international
law and Community law governing the circulation of waste. It is, moreover, evident that the proper functioning of the specific
system for the circulation of waste thereby established presupposes that each State complies with the obligations imposed
on it.
In those circumstances, compliance by the Federal Republic of Germany with an obligation which Community law imposes on all
the Member States in pursuit of a general interest, namely protection of health and the environment, does not confer on exporters
of waste established in its territory any specific or definite benefit (see, to this effect,
Commission
v
Germany
, cited above, paragraph 7).
That finding is supported by the fact that the obligation to contribute to the solidarity fund arises at the same time as
the obligation to notify a shipment of waste for outside Germany and that, in reality, the pecuniary charge borne by exporters
is determined solely according to the type and quantity of the waste to be shipped. There is thus nothing given in return
for any service actually provided to them, either as a category of operators or in an individual capacity.
It follows that the disputed contribution cannot be considered as payment for a service actually provided specifically to
the economic operators in question.
The contribution paid by way of compensation for a measure imposed by Community law with a view to promoting the free movement
of goods
In the light of the foregoing, it is appropriate to examine whether the contribution to the solidarity fund can be viewed
as a lawful charge in the form of compensation for a measure imposed by Community law with a view to promoting the free movement
of goods.
It should be recalled in this connection that, since the pecuniary charge in question is intended solely as financially and
economically justified compensation for an obligation imposed in equal measure on all the Member States by Community law,
it cannot be regarded as equivalent to a customs duty; nor, consequently, can it fall within the ambit of the prohibition
laid down in Articles 23 EC and 25 EC (Case 46/76
Bauhuis
[1977] ECR 5, paragraphs 34 to 36; and
Commission
v
Germany
, cited above, paragraph 14). This finding is not, in principle, precluded by the mere fact that other Member States themselves
agree to finance the return of waste, including shipment and disposal or recovery, through their own budgets (see, to that
effect, Case 89/76
Commission
v
Netherlands
[1977] ECR 1355, paragraph 18; Case 1/83
IGF
[1984] ECR 349, paragraphs 21 and 22; and
Commission
v
Germany
, cited above, paragraph 15).
It is, however, settled case-law of the Court that the pecuniary charge imposed on economic operators must be economically
justified in that there must be a direct link between the amount and the actual cost of the operation it is intended to finance,
in this case the possible return of the waste shipped, including shipment and disposal or recovery thereof (see, to that effect,
Case C-111/89
Bakker Hillegom
[1990] ECR I-1735, paragraphs 11 and 12).
The German Government argues in that respect that the contributions to the solidarity fund provided for in Germany do not
exceed the costs incurred by the State and that each fee, considered by itself, is proportional to the actual benefit conferred
on each specific operator. The German Government adds that Article 33(2) of Regulation No 259/93 allows the Member States
some discretion in determining the methods of financing the costs they incur as guarantors of the return of waste,
inter alia
through collection of fees.
The Court notes, however, that Article 33(2) of Regulation No 259/93 already provides that the costs arising from the return
of waste, including shipment, disposal or recovery of the waste in an alternative and environmentally sound manner are to
be charged to the notifier. The costs are borne by the Member States concerned only if that is not possible.
It should also be recalled that, under Articles 25(1) and 26(2)(a) of Regulation No 259/93, notifiers who have notified shipments
of waste which cannot be completed or which turn out to be illegal are required to proceed with the return of that waste themselves.
In addition, under Article 27(1) of Regulation No 259/93, all shipments of waste covered within the scope of that regulation
are to be subject to the provision of a financial guarantee or equivalent insurance covering costs for the possible return
of waste, including shipment and disposal or recovery.
It has therefore not been established that the contribution collected when each shipment of waste is carried out, when it
is notified pursuant to the provisions of Regulation No 259/93, is in any way related to the actual costs that operation is
likely to generate for the State in the event that it becomes necessary to return the waste shipped and to dispose of or recover
it. Given the provisions of that regulation, discussed in paragraphs 42 to 44 of this judgment, it appears, moreover, that
the scenarios in which the State will most frequently have to bear the costs associated with returning waste, including shipment,
disposal or recovery, will be precisely where, in the absence of notification, the guarantee or equivalent insurance has not
been provided and nor, therefore, has the contribution been paid.
The lack of correlation between the amount of the contribution and the actual cost of the operation it is intended to finance
is clear, notwithstanding the fact that, pursuant to the seventh sentence of Paragraph 8(1) of the AbfVerbrG, contributions
from the solidarity fund not used at the end of a three-year period are repaid to the operators proportionally to the amounts
they have paid in. Even on the supposition that this periodic repayment system is intended to adjust the individual contributions
to reflect the actual costs incurred by the State, as contended by the German Government, it should be remembered that the
portion of those contributions used to cover the administrative costs of the solidarity fund is not repaid. Likewise, the
financial loss resulting from the forfeiture of the amounts in question for three years ─ a loss not compensated for by interest
─ is, in any event, borne by the operators concerned. Neither does the progressive reduction of the overall volume of the
solidarity fund, which was initially established at DEM 75 million and was under DEM 16 million at the time the present proceedings
were brought, shed light on the costs actually incurred by the State to meet its obligation to return waste or establish that
the individual contributions are set at a level which is adequate in relation to those costs.
With respect to the issue of whether each contribution is proportional to the alleged benefit for each operator, it should
be recalled that, as the Court has found in paragraphs 35 to 37 above, the economic operators called upon to pay the contributions
to the solidarity fund do not derive any actual definite specific benefit from the activities financed by the fund.
As for the possible discretion the Member States may have under Article 33(2) of Regulation No 259/93, it cannot, in any event,
be used to levy additional, unjustified charges on notifiers.
The Court notes that appropriate administrative costs of implementing the notification and supervision procedure and usual
costs of appropriate analyses and inspections may be charged to the notifier, as provided for in Article 33(1) of Regulation
No 259/93.
Consequently, the Court finds that the contribution to the solidarity fund is a charge having equivalent effect to a customs
duty, which is prohibited by Articles 23 EC and 25 EC.
The Court thus finds that, by subjecting shipments of waste to other Member States to a mandatory contribution to the solidarity
fund established by the AbfVerbrG, the Federal Republic of Germany has failed to fulfil its obligations under Articles 23
EC and 25 EC.
Costs
Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs, if they have been
applied for in the successful party's pleadings. Since the Commission has so applied and the Federal Republic of Germany has
failed in its submissions, the latter must be ordered to pay the costs.
On those grounds,
THE COURT (Fifth Chamber)
hereby:
1.
Declares that, by subjecting shipments of waste to other Member States to a mandatory contribution to the solidarity fund
for the return of waste established by the Gesetz über die Überwachung und Kontrolle der grenzüberschreitenden Verbringung
von Abfällen (Abfallverbringungsgesetz) of 30 September 1994, the Federal Republic of Germany has failed to fulfil its obligations
under Articles 23 EC and 25 EC;
2.
Orders the Federal Republic of Germany to pay the costs.
Edward
La Pergola
Jann
von Bahr
Rosas
Delivered in open court in Luxembourg on 27 February 2003.
R. Grass
M. Wathelet
Registrar
President of the Fifth Chamber
–
Language of the case: German.