Opinion of the Advocate General — ECLI:EU:C:2025:162
Date: 2025-03-06
Language of the case: Swedish
Procedure: Reference for a preliminary ruling
Origin: Sweden

Translation C-125/24 – 1 
Case C-125/24 [Palmstråle]i 
Request for a preliminary ruling 
Date lodged: 
15 February 2024 
Referring court: 
Högsta förvaltningsdomstolen (Sweden) 
Date of the decision to refer: 
13 February 2024 
Appellant: 
AA 
Respondent: 
Allmänna ombudet hos Tullverket 
  
Request for a preliminary ruling under Article 267 TFEU concerning the 
interpretation of Article 143(1)(e) of Directive 2006/112/EC on the common 
system of value added tax (VAT Directive) and Articles 86(6) and 203 of 
Regulation (EU) No 952/2013 laying down the Union Customs Code (Union 
Customs Code) 
Introduction 
1 By its request for a preliminary ruling, the Högsta förvaltningsdomstolen 
(Supreme Administrative Court, Sweden) is seeking clarification as to how 
Article 143(1)(e) of the VAT Directive and Articles 86(6) and 203 of the Union 
Customs Code are to be interpreted in respect of the conditions under which the 
re-importation of goods is exempt from VAT. The question of interpretation has 
arisen in a case concerning non-compliance with customs rules upon re-
importation. 
 
i The name of the present case is a fictitious name. It does not correspond to the real name of any party to the proceedings. 
EN 
REQUEST FOR A PRELIMINARY RULING OF 13. 2. 2024 – CASE C-125/24 
 
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Applicable provisions of EU law 
VAT Directive 
2 Article 2(1)(d) of the VAT Directive provides that the importation of goods is 
subject to VAT. Under Article 30 thereof, importation of goods means the entry 
into the Community of goods which are not in free circulation within the meaning 
of Article 24 of the Treaty. 
3 Under Article 143(1)(e) thereof, Member States are to exempt the re-importation, 
by the person who exported them, of goods in the state in which they were 
exported, where those goods are exempt from customs duties. 
Union Customs Code 
4 Article 203(1) of the Union Customs Code provides that non-Union goods which, 
having originally been exported as Union goods from the customs territory of the 
Union, are returned to that territory within a period of three years and declared for 
release for free circulation must, upon application by the person concerned, be 
granted relief from import duty. Under paragraph 5 of that article, the relief is to 
be granted only if goods are returned in the state in which they were exported and, 
under paragraph 6 thereof, the relief must be supported by information 
establishing that the conditions for the relief are fulfilled. 
5 Goods brought into the customs territory of the Union must, under 
Article 139(1)(a) of that code, be presented to customs immediately upon their 
arrival at the designated customs office or any other place designated or approved 
by the customs authorities or in the free zone by the person who brought the goods 
into the customs territory of the Union. 
6 According to Article 79(1)(a) thereof, for goods liable to import duty, a customs 
debt on import is incurred through non-compliance with one of the obligations 
laid down in the customs legislation concerning, inter alia, the introduction of 
non-Union goods into the customs territory of the Union. 
7 Article 86(6) of the same code stipulates that, where the customs legislation 
provides for a favourable tariff treatment of goods, or for relief or total or partial 
exemption from import or export duty pursuant to inter alia Article 203 thereof, 
such favourable tariff treatment, relief or exemption is also to apply in cases 
where a customs debt is incurred pursuant to Article 79 thereof, on condition that 
the failure which led to the incurrence of a customs debt did not constitute an 
attempt at deception. 
8 According to recital 38 of the that code, it is appropriate to take account of the 
good faith of the person concerned in cases where a customs debt is incurred 
through non-compliance with the customs legislation and to minimise the impact 
of negligence on the part of the debtor. 
PALMSTRÅLE 
 
3 
Applicable national provisions 
9 At the material time in the present case, the Mervärdesskattelagen (Law on value 
added tax) (1994:200) was applicable. That law has now been replaced by a new 
Mervärdesskattelagen (2023:200), but the previous law continues to apply, in so 
far as is relevant here, to circumstances relating to the time before the new law 
entered into force. The applicable provisions of the 1994 law are outlined below. 
The new law contains essentially similar provisions. 
10 According to point 3 of the first paragraph of section 1 of Chapter 1, VAT is to be 
paid on the importation of goods into the country, which is liable for tax. Under 
section 1a of Chapter 2, ‘importation’ means that goods are brought into Sweden 
from a place outside the European Union. 
11 The first paragraph of section 30 of Chapter 3 provides that imports which are 
exempt from tax in accordance with Law (1994:1551) on inter alia exemption 
from tax on importation are exempt from tax. 
12 The first paragraph of section 5 of Chapter 2 of the Law on exemption from tax on 
inter alia importation states that exemption from tax is to be granted for Union 
goods which, after having been exported from the European Union to a third 
country, are brought into Sweden by the person who exported them, without their 
having been processed during the time they were exported from the European 
Union. According to the second paragraph thereof, exemption from tax is to be 
granted only if the goods are subject to relief from customs duty under, inter alia, 
Article 203 of the Union Customs Code. Goods which are exempt from customs 
duty under Regulation (EEC) No 2658/87 on the tariff and statistical 
nomenclature and on the Common Customs Tariff are treated as if they were 
subject to customs duty. 
Facts of the main proceedings 
13 AA owns horses which are used in competitions in various countries. She 
exported two horses to Norway, that is to say, outside the customs territory of the 
Union. After the horses had participated in competitions, they were brought back 
into the Union through a border crossing from Norway to Sweden. AA did not 
stop at the customs post to present the goods brought in. Instead, she was stopped 
at the Tullverket (Customs Authority) road check shortly after she had passed the 
customs post. 
14 The Customs Authority decided to charge AA VAT in the amount of SEK 41 178. 
No customs duty was levied. According to the Customs Authority, exemption 
from VAT on re-importation could not be granted because AA had not declared 
the horses for release for free circulation or applied for relief from customs duty. 
15 AA appealed against the decision before the Förvaltningsrätten i Karlstad 
(Administrative Court, Karlstad, Sweden), which dismissed the appeal. The 
REQUEST FOR A PRELIMINARY RULING OF 13. 2. 2024 – CASE C-125/24 
 
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Förvaltningsrätten found that the horses had not been presented to customs upon 
their arrival into Union customs territory, that a customs debt had therefore been 
incurred and that this meant that VAT was payable. The court then held that a 
fundamental requirement for the grant of exemption from VAT on re-importation 
is that the goods be declared for release for free circulation and that an application 
be made by the declarant. Because this had not happened, exemption from VAT 
could not be granted. 
16 Both AA and the Allmänna ombudet hos Tullverket (General Representative of 
the Customs Authority, Sweden) appealed against the judgment of the 
Förvaltningsrätten before the Kammarrätten i Göteborg (Administrative Court of 
Appeal, Gothenburg, Sweden) and claimed that the decision to charge AA VAT 
should be annulled. The Kammarrätten dismissed the appeals on essentially the 
same grounds as those relied on by the Förvaltningsrätten. 
17 AA appealed against the judgment of the Kammarrätten before the Högsta 
förvaltningsdomstolen, which granted leave to appeal. The public action in this 
case before the Högsta förvaltningsdomstolen is being brought by the General 
Representative of the Customs Authority. The General Representative – and not 
the Customs Authority – is thus the individual’s opposing party. The Customs 
Authority has however been given the opportunity to submit observations in the 
case. 
18 In the correspondence that was exchanged between the parties after leave to 
appeal had been granted, AA asserted that she had made an oral declaration to 
customs staff when she was stopped after passing the customs post. The General 
Representative countered that the officials who were working at the customs 
office on that day deny that any oral declaration was made. 
19 AA did not indicate earlier in the proceedings that an oral declaration had been 
made. There must be special reasons for a circumstance relied on for the first time 
before the Högsta förvaltningsdomstolen to be taken into consideration by the 
court. The Högsta förvaltningsdomstolen will decide later whether the 
submissions made by AA regarding the oral declaration should be taken into 
consideration. The present request for a preliminary ruling, however, concerns 
only the events that have been examined in the lower courts, namely that the 
customs office was passed without the goods being presented and without a 
customs declaration or application for relief from customs duty being submitted. 
Positions of the parties and the Customs Authority 
AA 
20 AA claims that the decision of the Kammarrätten should be altered such that the 
Customs Authority’s decision to charge her VAT is annulled. She makes the 
following arguments. 
PALMSTRÅLE 
 
5 
21 She did not have anything to gain financially by not stopping at the customs office 
and declaring the entry of the horses but, in the animals’ best interests, she wanted 
to be in time to catch a ferry to Finland, thereby shortening the journey time for 
them. Prior to the outward journey, she had ensured that the temporary exportation 
to Norway was correctly handled and she believed that the conditions for re-
importation were thus also fulfilled. This was an error on her part and it is 
unreasonable that it should result in her being charged VAT by reason of re-
importation. 
22 Article 86(6) of the Union Customs Code should be interpreted as meaning that 
entitlement to relief from customs duty, and thus exemption from VAT, exists 
even if the procedural conditions in Article 203 are not fulfilled, provided that 
there is no question of an attempt at deception. Because the substantive conditions 
in Article 203 are fulfilled and there is no attempt at deception, she should not be 
charged VAT. 
General Representative of the Customs Authority 
23 The General Representative of the Customs Authority now takes the view that the 
decision to charge AA VAT was correct and therefore considers that her appeal 
against the judgment of the Kammarrätten should be dismissed. The General 
Representative makes the following arguments. 
24 One requirement for the re-importation of the horses to be exempt from VAT is 
that they be subject to relief from customs duty. It is clear that the substantive 
conditions for relief from customs duty under Article 203 of the Union Customs 
Code are fulfilled and that there is no question of attempted fraud. 
25 It is also a condition for relief under that Article 203 that the goods be declared for 
release for free circulation and that the person concerned apply for relief. 
Articles 86(6) and 203 do not contain any exceptions to those conditions. They 
should therefore be considered to apply also in cases where the customs debt 
under Article 79 is incurred through non-compliance with one of the obligations 
laid down in customs legislation. 
26 It is not apparent from the file before the court that AA fulfilled the procedural 
conditions in Article 203 when the horses were brought into Union customs 
territory. 
Customs Authority 
27 The Customs Authority claims that the appeal should be dismissed and makes the 
following arguments. Because the goods were not declared for release for free 
circulation, they are not subject to relief from customs duty under Article 203. 
Their importation must therefore be liable for VAT. 
REQUEST FOR A PRELIMINARY RULING OF 13. 2. 2024 – CASE C-125/24 
 
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The need for a preliminary ruling 
28 It is apparent from the VAT Directive that the importation of goods from a third 
country into the Union is subject to VAT. According to Article 143(1)(e) of the 
directive, however, Member States are to exempt the re-importation, by the person 
who exported them, of goods in the state in which they were exported, where 
those goods are exempt from customs duties. 
29 AA reimported the horses in the state in which they were when she exported them. 
The decisive factor in determining whether she is liable to pay VAT in respect of 
re-importation is therefore whether the horses are exempt from customs duties 
within the meaning of Article 143(1)(e). 
30 Relief from import duty on re-importation is regulated in Article 203 of the Union 
Customs Code. It is common ground that the substantive conditions for relief laid 
down therein are fulfilled in this case. As has been mentioned in paragraph 19 
above, however, this request for a preliminary ruling has arisen because AA 
failed, in breach of Article 139(1) of the Union Customs Code, to present the entry 
of the goods at the customs office and the procedural conditions for relief laid 
down in Article 203 – that the goods must be declared for release for free 
circulation and an application for relief must be submitted – were not fulfilled by 
her. 
31 It is apparent from Article 79(1)(a) of the Union Customs Code that, for goods 
liable to import duty, a customs debt on import is incurred through non-
compliance with one of the obligations laid down in the customs legislation 
concerning the introduction of non-Union goods into the customs territory of the 
Union. According to Article 86(6), however, the relief from import duty provided 
for in Article 203 must also apply in cases where a customs debt is incurred 
pursuant to Article 79, on condition that the failure which led to the incurrence of 
a customs debt did not constitute an attempt at fraud. In the case at issue, it is 
undisputed that AA did not make an attempt at deception. 
32 AA asserts that Article 86(6) of the Union Customs Code should be interpreted as 
meaning that entitlement to relief from customs duty exists even if the procedural 
conditions in Article 203 are not fulfilled. On this interpretation, the horses are 
therefore subject to relief from customs duty, which means, pursuant to 
Article 143(1)(e) of the VAT Directive, that their re-importation should be exempt 
from VAT. 
33 The General Representative submits, by contrast, that the procedural conditions 
laid down in Article 203 of the Union Customs Code must also be fulfilled in 
order for relief from import duty to be granted. Since those conditions are not 
fulfilled, exemption from VAT under Article 143(1)(e) of the VAT Directive 
should not be granted under this interpretation. 
34 In the view of the Högsta förvaltningsdomstolen, it is unclear which of these 
interpretations is the correct one. 
PALMSTRÅLE 
 
7 
35 On the one hand, as the General Representative argues, the wording of 
Articles 86(6) and 203 merely provides that all the conditions laid down in 
Article 203 must be fulfilled for relief to be possible. Consequently, the wording 
in itself does not support the view that, in the situations covered by Article 79, the 
procedural conditions laid down in Article 203 do not also have to be fulfilled in 
order for relief to be granted. 
36 On the other hand, it is a requirement in order for a customs debt under Article 79 
to be incurred at all that there have been non-compliance with one of the 
obligations laid down in customs legislation. The question arises in which 
situations can an importer be at fault for such non-compliance yet simultaneously 
fulfil the procedural conditions laid down in Article 203. In any event, an 
infringement like the one at issue in this case – failure to present the entry of 
goods in contravention of Article 139(1) – is unlikely to occur without the 
importer also simultaneously failing to submit a customs declaration and apply for 
relief. An interpretation based strictly on the wording of the provisions would thus 
probably mean that Article 86(6) never applies in such a situation. It is 
questionable whether this is compatible with the purpose of the provisions (cf. 
recital 38 of the Union Customs Code). 
37 The question of interpretation arising in this case does not appear to have been 
examined by the Court of Justice of the European Union and, in the view of the 
Högsta förvaltningsdomstolen, there is therefore not sufficient guidance for it to 
give judgment. It is thus necessary to obtain a preliminary ruling from the Court 
of Justice of the European Union. 
38 In the light of the foregoing, the Högsta förvaltningsdomstolen requests an answer 
to the following question. 
Question 
39 Must Article 143(1)(e) of the VAT Directive and Articles 86(6) and 203 of the 
Union Customs Code be interpreted as meaning that both the substantive and the 
procedural conditions laid down in Article 203 must be fulfilled in order for relief 
from import duty – and thus exemption from VAT – to be granted on re-
importation where a customs debt under Article 79 of the Union Customs Code 
has been incurred through non-compliance with the presentation obligation laid 
down in Article 139(1) of the Union Customs Code?