Judgment;Summary — ECLI:EU:C:2020:157
Date: 2020-03-04
Language of the case: Bulgarian
Court formation: Eighth Chamber
Subject matter: Free movement of goods;Internal market - Principles;Common customs tariff;Customs Union
Procedure: Reference for a preliminary ruling
Origin: Bulgaria

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Translation C-655/18 — 1 
Case C-655/18 
Request for a preliminary ruling 
Date lodged: 
19 October 2018 
Referring court: 
Administrativen sad Varna (Varna Administrative Court, Bulgaria) 
Date of the decision to refer: 
5 October 2018 
Appellant in cassation: 
Mitnitsa Varna (Varna Customs Authority) 
Respondent in cassation: 
Schenker EOOD 
  
ORDER 
[…] 
The proceedings were initiated following the appeal in cassation lodged, through 
its legal adviser AB, by Mitnitsa Varna (Varna Customs Authority) against 
Judgment No 250 of 16 February 2018 of the Rayonen sad Varna (Varna District 
Court) in Case No 3903/2017 (administrative offence). In the course of the 
proceedings, the referring court found that a correct resolution of the dispute 
pending before it requires an interpretation of provisions of EU law. 
I. Parties to the dispute: 
1. Appellant in cassation: Varna Customs Authority […] Sofia […]. 
2. Respondent in cassation: Schenker EOOD […]. 
EN 
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3. Intervener: Public prosecutor of the Okrazhna prokuratura Varna (Varna 
District Prosecution Service). 
II. Subject matter of the proceedings: 
Judgment No 250 of 16 February 2018 of the Varna District Court in Case 
No 3903/2017 (administrative offence) annulling penalty notice No 109/2017 
issued by the director of Varna Customs Authority imposed on Schenker EOOD 
in accordance with Article 234a(1) and (3), in conjunction with Article 233(6) of 
the Zakon za mitnizite (Bulgarian Customs Code, ‘ZM’): 1. an administrative 
(financial) penalty of BGN 23 826.06 (twenty-three thousand eight hundred and 
twenty-six lev and six stotinki) and 2. a charge of BGN 23 826.06 as the 
equivalent value of the missing items which are the subject of the offence (18 
crates of black-coated marine plywood with a poplar wood core, 1220 x 2440 x 20 
mm, 52 390 m3). 
III. Facts relevant to the subject matter of the request for a preliminary 
ruling: 
III.1. On 16 March 2017, Teld Consulting OOD Varna […] submitted a customs 
warehousing declaration, signed by its employee KL, for the following goods: 
[Or. 2] — 198 crates (packaging items) of marine plywood, poplar wood core, 
black-coated, 1220 x 2440 x 20 mm, loaded in 11 containers, including the 
contested container No CLHU8983474 (item 1); 
– 18 crates (packaging items) of marine plywood, poplar wood core, black-coated, 
1220 x 2440 x 21 mm, loaded in one container (item No 21); and 
– 18 crates (packaging items) of marine plywood, poplar wood core, brown-
coated, 1220 x 2440 x 21 mm, loaded in one container (item No 21). 
The declaration was submitted for and on behalf of Balkantrade Properties EOOD, 
Troyan, by its customs agent […]. 
When the customs declaration was submitted, the containers with the goods were 
located in the port of Varna-West. Following completion of the customs 
formalities for the customs warehousing arrangement, 12 of the 13 containers with 
the plywood declared on the customs declaration were transferred to a type A 
customs warehouse […] used and managed by Schenker EOOD under 
authorisation No BG002000/71/000078, with five containers of goods entering the 
customs warehouse on 17 March 2017 and the remaining seven on 20 March 
2017. 
The remaining seven containers were to be collected from the port of Varna-West 
by Fortis Trade OOD, whose managing director is OR, the haulage company 
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instructed by MN, an employee of Schenker EOOD. That company operates eight 
lorries and seven trailers out of the West Industrial Zone in Varna (on the site of 
the old brewery) which are normally parked in the yard of the West Logistics 
Park. According to the work schedule dated 17 March 2017, the goods in 
container CLHU8983474 were to be loaded on to a tractor registration No B 
3720HB with a Schmitz trailer registration No B0111EC belonging to the haulage 
company Fortis Trade EOOD and delivered to the Schenker EOOD warehouse on 
20 March 2017. The instruction in question was issued by the manager of the 
haulage company. In keeping with the standard practice applied by that company 
to optimise transportation and to ensure mandatory rest periods are taken, the 
container was removed from the port of Varna at the end of the working day (at 
17:32 hours) on 17 March 2017, using a DAF model TE XF tractor and a Schmitz 
SCF 24 trailer, by a driver employed by the company. In order to be able to 
transport the goods to the aforementioned warehouse on 20 March 2017, the 
driver parked the lorry, on which he had loaded the goods, in the lorry park in 
which the other vehicles belonging to the company are usually parked, namely in 
a paying lorry park within the West Industrial Zone. At around 13:00 hours on 
19 March 2017, the manager of the haulage company, OR, went to the lorry park 
and found that the aforementioned vehicle was missing. He assumed, having 
checked the GPS data and found that the GPS system was triggered at 14:53 hours 
on 18 March 2017, that the lorry was started at that time by a person unknown and 
driven out of the lorry park together with the contested container. 
The manager of Fortis Trade OOD reported the theft to the competent authorities 
at the time of its discovery on 19 March 2017. Preliminary investigation 
No 448/2017 was initiated by the Ministerstvo na vatreshnite raboti Varna (Varna 
Department of the Ministry of the Interior), and the Rayonna prokuratura Varna 
(Varna District Prosecution Service) opened case No 3371/2017 charging a person 
unknown with an offence under Article 346(1) of the Nakazatelen kodeks 
(Bulgarian Penal Code), whereby it was subsequently established that it was an 
offence under Article 195(2) of the Bulgarian Penal Code. 
The CCTV system was checked during the course of the preliminary 
investigation. It had recorded a DAF lorry registration No 3720 HB [Or. 3] at the 
Topoli checkpoint at 15:10:02 hours on 18 March 2017 travelling from Varna to 
Devnya. 
The Varna District Prosecution Service closed the preliminary investigation by 
order dated 11 December 2017 as, despite the investigative measures taken, the 
offender had not been identified within the period stipulated in Article 234(1) of 
the Nakazatelno-protsesualen kodeks (Bulgarian Code of Criminal Procedure). 
As a result, the contested container and the 18 crates of plywood in it were not 
delivered to the aforementioned warehouse managed by Schenker EOOD either 
on the aforementioned date or on a later date. 
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As a result of the theft, the goods were not reported in the accounts of Schenker 
EOOD, as none of the company’s employees physically had anything to do with 
the plywood after the goods entered the country. 
The 3rd Rayonno upravlenie pri Oblastna direktsia na Ministerstvo na vatreshnite 
raboti Varna (Division III of the Varna Department of the Bulgarian Ministry of 
the Interior) issued Schenker EOOD with confirmation dated 22 March 2017 of 
the preliminary investigation initiated. The company’s branch manager notified 
the competent customs authority in Varna verbally of that confirmation, 
whereupon the customs authority inspected the Schenker EOOD warehouse. The 
inspection concerned ‘customs warehousing’ declaration No BG002002T0002777 
dated 16 March 2017, which was approved at 9:17:32 hours on 17 March 2017 for 
the goods in question with the proviso that the goods be stored in the 
aforementioned warehouse. It was established during the inspection that the 
contested 18 crates of marine plywood had not arrived and were not in the 
warehouse. 
Based on those facts, a customs inspector of the Mitnichesko razuznavane i 
razsledvane (Department of Customs Information Procurement and Investigation) 
of Varna Customs Authority issued a notice finding that Schenker EOOD had 
committed an administrative offence under Article 234a(1) ZM by unlawfully 
removing, on 22 March 2017, 18 crates of ‘black-coated marine plywood with a 
poplar wood core, 1220x2440x20mm, 52.390 m3, placed under customs 
warehousing arrangements, further to which the director of Varna Customs 
Authority issued penalty notice No 109/2017 imposing the following penalties on 
Schenker EOOD in accordance with Article 234a(1) and (3), in conjunction with 
Article 233(6) ZM: 1. a fine of BGN 23 826.06 (twenty-three thousand eight 
hundred and twenty-six lev and six stotinki) and 2. a charge of BGN 23 826.06 as 
the equivalent value of the missing items which are the subject of the offence (18 
crates of black-coated marine plywood with a poplar wood core 1220 x 2440 x 20 
mm, 52.390 m3). 
Varna District Court found the facts of the matter as recounted above based on 
oral and written evidence taken during the court proceedings. 
III.2. Schenker EOOD initiated action against that notice before Varna District 
Court, which was registered as case No 3903/2017 (administrative offence) in the 
court register. 
By Judgment No 250 of 16 February 2018 delivered in those proceedings, that 
court set aside the penalty notice. The court arrived at that legal outcome based on 
the assumption that the administrative offence proceedings were vitiated by 
material procedural errors, as the period of the offence in the notice of the offence 
did not tally with the period in the penalty notice and, furthermore, the offence 
was not described in sufficient detail, as it did not state the specific act or 
omission by a person employed by the company which was the cause of the 
offence. 
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Varna District Court ruled that the penalty notice infringed substantive law, as the 
act did not fulfil the actus reus of the offence. 
[Or. 4] The court stated as its reason that the theft was a case of force majeure and 
that there was no causal link between an unlawful act or an unlawful omission on 
the part of the company and the consequence that ensued, namely the fact that the 
customs authority was prevented from accessing the goods subject to customs 
supervision and exercising the controls provided for under customs legislation. 
III.3. Varna Customs Authority appealed the judgment of Varna District Court by 
the admissible appeal in cassation. 
IV. Law cited 
A. National Law 
1. Procedural rules; 
2. Substantive legal rules. 
IV.A.1. The applicable procedural rules are the Zakon za administrativnite 
narushenia i nakazania (Bulgarian Law on Administrative Offences and 
Administrative Penalties, ‘ZANN’, promulgated in DV No 92/1969, amended in 
No 54 of 11 July 1978, supplemented in No 28 of 9 April 1982, entered into force 
on 1 July 1982, with further amendments and addenda), the 
Aministrativnoprotsesualen kodeks (Bulgarian Code of Administrative Procedure, 
‘APK’, promulgated in DV No 2000/2006, entered into force on 12 July 2006, 
with further amendments and addenda), the Nakazatelno-protsesualen kodeks 
(Bulgarian Code of Criminal Procedure, ‘NPK’, promulgated in DV No 86 of 
28 October 2005, entered into force on 29 April 2006, with further amendments 
and addenda). 
IV.A.1.1. — Article 13 ZANN states: 
‘Administrative offences are punishable by the following administrative penalties: 
a) warning; b) fine; c) forfeiture for a limited period of time of the right to engage 
in a particular profession or a particular activity.’ 
IV.A.1.2. — Article 83(1) states: ‘In the cases stipulated by law, decree, 
regulation adopted by the Council of Ministers or regulation adopted by the 
municipal council, a financial penalty may be imposed on legal entities or private 
businessmen on the grounds of failure to discharge duties towards central or local 
government during the course of their activities.’ Paragraph 2 states: ‘The penalty 
referred to in paragraph 1 is imposed under the procedure laid down by this law, 
unless a relevant legal act provides otherwise.’ 
IV.A.1.3 — Article 20 ZANN states: 
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‘1. Aside from the administrative penalties provided for under Article 13, the 
authority which imposes the penalty shall order the confiscation of goods 
belonging to the offender which were used to commit a wilful administrative 
offence, provided that is allowed under the relevant provision or decree. 
2. Items which are the subject of the offence and of which possession is prohibited 
shall also be confiscated, irrespective of their quantity, value and location. 
3. Aside from the items referred to in paragraph 2, items belonging to the offender 
which are the subject of the offence shall be confiscated, provided that is allowed 
under the relevant provision or decree. 
[Or. 5] 4. Confiscation under paragraphs 1 and 3 is not permitted if the value of 
the goods is manifestly out of proportion to the nature and gravity of the 
administrative offence, provided that the relevant provision or relevant degree 
does not stipulate otherwise.’ 
IV.A.2. Article 59(1) ZANN provides that the penalty notice and electronic 
penalty notice are subject to appeal before the district court of the district in which 
the offence was committed or completed and, in respect of offences committed 
abroad, before the Sofiyski rayonen sad (Sofia District Court). 
IV.A.3. Article 63(1) ZANN provides that the district court in a composition 
consisting of a single judge shall examine the case on the merits and deliver a 
judgment which may uphold, amend or set aside the penalty notice or electronic 
penalty notice. The judgment is subject to appeal on the grounds laid down in the 
NPK, in accordance with Chapter 12 APK by an appeal in cassation before the 
Administrativen sad (Administrative Court). 
IV.A.4. The applicable substantive law is the Bulgarian Customs Code (DV 
No 15 of 6 February 1998, entered into force on 1 January 1999, with further 
amendments and addenda, ZM). The responsibility of Schenker EOOD for the 
administrative offence is based on Article 234a(1) and (3), in conjunction with 
Article 233(6) ZM. 
IV.A.5. The legal provisions referred to in section IV.A.4 stated as follows at the 
time of the offence (17 to 22 March 2017): 
‘Article 233 
1. A person who ships or moves goods across the national border without the 
knowledge and approval of the customs authorities or who attempts to do so shall 
be penalised for smuggling by a fine equal to between 100 and 200 per cent of the 
customs value of the goods and, on exportation, equal to the value of the goods, 
unless the act is a criminal offence. 
2. A person who ships or moves goods across an external border of the European 
Union without the knowledge and approval of the customs authorities which are 
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discovered during inspection in the territory of the Republic of Bulgaria shall also 
be penalised for smuggling. 
3. If a vehicle or means of transport with a secret compartment is used to commit 
the offence referred to in paragraph 1 or if the goods smuggled are subject to 
excise duty or their importation or exportation is prohibited, the fine shall be equal 
to between 200 and 250 per cent of the customs value of the goods on importation 
or the value of the goods on exportation; if the smuggled goods are tobacco 
products, the fine shall be equal to between 200 and 250 per cent of the selling 
price. 
4. In the event of a repeat offence in accordance with paragraphs 1 and 2, the 
maximum fine shall be imposed for the offence concerned. 
[Or. 6] 5. In the event of a repeat offence in accordance with paragraph 3, the 
maximum fine or a minimum fine of BGN 1 000 shall be imposed for the offence 
concerned; if the goods which were the subject of the offence were tobacco 
products, the minimum fine shall be BGN 2 000. 
6. Smuggled goods are subject to confiscation, irrespective of who owns them; if 
they are not available or have been disposed of, the offender shall be ordered to 
pay the equivalent of their customs value on importation or the value of the goods 
on exportation.  
7. Smuggled goods must also be confiscated if the identity of the offender is not 
known. 
8. Vehicles or means of transport used to move or ship the smuggled goods shall 
be confiscated, irrespective of who owns them, unless their value is manifestly 
disproportionate to the value of the smuggled goods.’ 
‘Article 234a 
1. A person who temporarily unlawfully removes stored goods or goods declared 
for a customs procedure or re-exportation without complying with certain terms 
laid down by law or by the customs authority shall be penalised by a fine (in the 
case of private individuals) or by a financial penalty (in the case of legal entities 
and private businessmen) equal to between 100 and 200 per cent of the customs 
value of the goods or, in the event of exportation, equal to the value of the goods 
that were the subject of the offence. 
2. If the goods which were the subject of the offence are subject to excise duty, the 
fine (in the case of private individuals) or the financial penalty (in the case of legal 
entities and private businessmen) shall be equal to between 150 and 250 per cent 
of the customs value of the goods or, in the event of exportation, equal to the 
value of the goods that were the subject of the offence. 
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3. The provisions of Article 233(6), (7) and (8) shall apply mutatis mutandis in the 
cases referred to in paragraphs 1 and 2.’ 
C. EU law:  
IV.C.1. Regulation (EU) No 952/2013 of the European Parliament and of the 
Council of 9 October 2013 laying down the Union Customs Code. 
V. Case-law 
V.1. Judgment of the Court (Second Chamber) of 11 July 2013, Harry Winston, 
C-273/12 (request for a preliminary ruling from the Cour de Cassation, France). 
The Court gave the following binding interpretation: 
1. Article 203(1) of Council Regulation (EEC) No 2913/92 of 12 October 1992 
establishing the Community Customs Code, as [Or. 7] amended by Council 
Regulation (EC) No 1791/2006 of 20 November 2006, must be interpreted as 
meaning that a theft of goods placed under customs warehousing arrangements 
constitutes an unlawful removal of those goods within the meaning of that 
provision, giving rise to a customs debt on importation. Article 206 of that 
regulation is capable of applying only to situations in which a customs debt is 
liable to be incurred pursuant to Articles 202 and 204(1)(a) of that regulation. 
2. The second subparagraph of Article 71(1) of Council Directive 2006/112/EC of 
28 November 2006 on a common system of value added tax must be interpreted as 
meaning that the theft of goods placed under customs warehousing arrangements 
gives rise to the chargeable event and causes value added tax to become 
chargeable. 
VI. Arguments and legal opinions of the parties 
VI.1. The appellant in cassation, Mitnitsa Varna, is contesting the judgment of 
Varna District Count on the ground that it infringes substantive law. It is of the 
opinion that the administrative offence proceedings were not vitiated by any 
material procedural error. It argues on the application of the law that, even if the 
goods were not reported in the inventory accounts of the authorisation holder, 
once the goods had been placed under customs warehousing arrangements, a duty 
arose not to remove the goods from customs supervision and to comply with the 
obligations arising from the customs warehousing arrangement. It relies upon the 
judgment of the Court of Justice of the European Union in Case C-273/12 and 
submits that the theft was not a case of force majeure that might absolve the 
warehouse keeper from responsibility. 
VI.2. The respondent in cassation has contested that in writing. It is of the opinion 
that the Varna District Court was right to find that the administrative offence 
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proceedings were vitiated by procedural errors. It argues on the application of the 
substantive law that the conditions for ascribing responsibility for an 
administrative offence to the company are not fulfilled. 
VII. Reasons for the request for a preliminary ruling 
VII.1. The court is the court of cassation in this case and its judgment is not open 
to any judicial remedy, including objection by the prosecution service. 
Article 42(1) of Regulation (EU) No 952/2013 of the European Parliament and of 
the Council of 9 October 2013 laying down the Union Customs Code states that 
each Member State is to provide for penalties for failure to comply with the 
customs legislation. Such penalties ae to be effective, proportionate and 
dissuasive. The administrative penalties provided for under Article 42(2) of the 
Regulation may take one or both of the following forms: 1. a pecuniary charge by 
the customs authorities, including, where appropriate, a settlement applied in 
place of and in lieu of a criminal penalty; 2. the revocation, suspension or 
amendment of any authorisation held by the person concerned. 
In the present case, the customs office imposed two administrative penalties on 
the company: a financial penalty of BGN 23 826.06, on the one hand, and a 
charge of BGN 23 826.06 as the equivalent value of the missing goods which 
were the subject of the offence. The penalty of payment of the equivalent value of 
the goods unlawfully removed does not correspond to either form of penalty 
provided for under Article 42(2) of the regulation. Nor is this a case of unlawful 
removal within the meaning of Articles 20 and 21 [Or. 8] ZANN. That suggests 
that there is a contradiction between national law (in this instance Article 234a(3) 
ZM) and Article 42(2) of the regulation. Furthermore, the question arises as to 
whether, in that case, the penalty of payment of the equivalent value of the 
missing goods imposed alongside the financial penalty meets the criteria of 
effectiveness and proportionality. 
Account also needs to be taken of the fact that the judgment of the Court of Justice 
of the European Union in Case C-273/12 interprets EU law (Article 203(1) of 
Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the 
Community Customs Code) as meaning that the theft of goods placed under a 
custom warehousing arrangement constitutes unlawful removal of those goods 
within the meaning of that provision that gives rise to a customs debt on 
importation. In this case, the financial penalty follows from the theft of the goods, 
whereas public-sector claims in respect of goods unlawfully removed from 
customs control are the subject matter of a different administrative procedure and 
those claims have already been settled in full in this case. 
In the light of that and the facts of the case, the court is of the opinion that it is 
admissible and necessary for the purpose of giving judgment to request a 
preliminary ruling by the Court of Justice of the European Union and that such a 
request within the meaning of the second paragraph of Article 267 of the Treaty 
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on the Functioning of the European Union as to the interpretation of 
Article 242(1)(a) and (b) and of Article 42(1) and (2) of Regulation (EU) 
No 952/2013 of the European Parliament and of the Council of 9 October 2013 
laying down the Union Customs Code is absolutely necessary. 
For those reasons, the Varna Administrative Court, Cassation Chamber VIII, 
hereby issues, pursuant to the third paragraph of Article 267 TFEU, in conjunction 
with Article 628 of the Grazhdanki-protsesualen kodeks (Bulgarian Code of Civil 
Procedure) and Article 144 APK, and on the basis of Article 631 GPK, in 
conjunction with Article 144 APK and Article 63(1) ZANN, the following 
ORDER 
The Court of Justice of the European Union is requested, in accordance with 
subparagraph (b) of the first paragraph of Article 267 TFEU to give a preliminary 
ruling on the following questions: 
1. Should Article 242(1)(a) and (b) of Regulation (EU) No 952/2013 of the 
European Parliament and of the Council of 9 October 2013 laying down the 
Union Customs Code be interpreted as meaning that, under the specific 
circumstances of the main proceedings, the theft of goods placed under a 
customs warehousing procedure constitutes a removal from the customs 
warehousing procedure that gives cause for the imposition of a financial 
penalty on the authorisation holder for an offence under customs legislation? 
2. Is the imposition of a charge equivalent to the value of the goods that were 
the subject of the customs offence (in this case removal from the customs 
warehousing procedure) an administrative penalty within the meaning of 
Article 42(1) and (2) of Regulation (EU) No 952/2013 of the European 
Parliament and of the Council of 9 October 2013 laying down the Union 
Customs Code, and is a national provision regulating such a payment, 
alongside the imposition of the financial penalty, permissible? Does such a 
rule meet the criteria of effectiveness, proportionality and [Or. 9] 
dissuasiveness of penalties for failure to comply with the EU customs 
legislation laid down in the second sentence of Article 42(1) of the 
regulation? 
[…]