62003CJ0542_EN
Parties
Grounds
Operative part
Parties
In Case C-542/03,
REFERENCE for a preliminary ruling under Article 234 EC from the Bundesfinanzhof (Germany), made by decision of 18 November 2003, received at the Court on 23 December 2003, in the proceedings
Hauptzollamt Hamburg-Jonas
v
Milupa GmbH & Co. KG,
THE COURT (Third Chamber),
composed of A. Rosas (Rapporteur), President of the Chamber, A. La Pergola, J.-P. Puissochet, U. Lõhmus and A. Ó Caoimh, Judges,
Advocate General: P. Léger,
Registrar: R. Grass,
after considering the observations submitted on behalf of:
– Milupa GmbH & Co. KG, by H. Wrobel and F. Boulanger, Rechtsanwälte,
– the Commission of the European Communities, by G. Braun, acting as Agent,
having regard to the written procedure,
having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,
gives the following
Judgment
Grounds
1. This reference for a preliminary ruling concerns the interpretation of the second sentence of the first subparagraph of Article 7(1), the first subparagraph of Article 7(2) and Article 7(5) of Commission Regulation (EC) No 1222/94 of 30 May 1994 laying down common detailed rules for the application of the system of granting export refunds on certain agricultural products exported in the form of goods not covered by Annex II to the Treaty, and the criteria for fixing the amount of such refunds (OJ 1994 L 136, p. 5), as amended by Commission Regulation (EC) No 229/96 of 7 February 1996 (OJ 1996 L 30, p. 24; ‘Regulation No 1222/94’).
2. The reference has been made in the course of proceedings between Hauptzollamt Hamburg-Jonas (‘the Hauptzollamt’) and the company Milupa GmbH & Co. KG (‘Milupa’) concerning the right to receive export refunds in respect of a product comprising a semi-prepared mixture which was not produced from fresh skimmed milk, as declared in the export document, but from skimmed milk concentrate.
Community legal framework
Regulation (EC) No 3448/93
3. Council Regulation (EC) No 3448/93 of 6 December 1993 laying down the trade arrangements applicable to certain goods resulting from the processing of agricultural products (OJ 1993 L 318, p. 18) provides in Article 8(1):
‘On exportation of the goods, the agricultural products which have been used and which satisfy the conditions laid down in Article 9(2) of the Treaty may qualify for refunds established pursuant to the regulations on the common organisation of the market in the sectors concerned.
No export refund may be granted on agricultural products incorporated into goods not covered by a common organisation of the market providing for export refunds on products exported in the form of such goods.’
Regulation No 1222/94
4. This regulation lays down common detailed rules for the application of the system of granting refunds applicable to processed agricultural products which are exported in the form of goods not covered by Annex II of the EC Treaty (now, after amendment, Annex I EC), the basic products of which are listed in the annexes to one of the basic regulations on the common organisation of the market in the milk and milk products, eggs, rice, sugar and cereals sectors. Regulation No 1222/94 applies to the basic products listed in Annex A to the regulation, to products derived from the processing thereof in Annexes B and C, and to products assimilated to one of those two categories by virtue of the provisions of Article 1(2) of that same regulation.
5. Annex A to Regulation No 1222/94 includes, in particular, the basic product which has been given code CN ex 0402 10 19, described as ‘[m]ilk powder, not containing added sugar or other sweetening matter, obtained by the spray process, with a fat content not exceeding 1.5% by weight and with a water content of less than 5% by weight (PG 2)’.
6. Article 1(2) of Regulation No 1222/94 provides that a certain number of products are to be assimilated to other products. Thus, the first indent of Article 1(2)(c) and the first indent of Article 1(2)(f) of that regulation, as amended by Commission Regulation (EC) No 2915/95 of 18 December 1995 (OJ 1995 L 305, p. 33) provide:
‘For the purposes of this Regulation:
...
(c) milk and the milk products falling within CN codes 0403 10 22, 0403 90 51, 0404 90 11 and 0404 90 31, not concentrated nor containing added sugar or other sweetening matter, even frozen, of a milk fat content, by weight, not exceeding 0.1%,
...
shall be assimilated to skimmed milk powder listed in Annex A (PG 2);
...
(f) milk, cream and the milk products falling within CN codes 0403 10 22 to 0403 10 26, 0403 90 51 to 0403 90 59 and 0404 90 11 to 0404 90 39 concentrated, other than in powder, granules or other solid forms, not containing added sugar or other sweetening matter,
…
shall be assimilated to:
(i) skimmed milk powder listed in Annex A (PG 2) regarding the non-fat part of the dry matter content of the assimilated product and
(ii) butter listed in Annex A (PG 6) regarding the fat of the assimilated product’.
7. Article 3 of Regulation No 1222/94 contains various provisions relating to the determination of the quantity of basic products to be taken in calculating the amount of the refund. In particular, Article 3(2) provides that, in certain circumstances, that quantity may, by agreement with the competent authorities, be determined either from the manufacturing formula for the goods or from the average quantities of product used over a specified period in the manufacture of a given quantity of those goods.
8. Article 7 of Regulation No 1222/94 provides:
‘1. The provisions of Regulation (EEC) No 3665/87 shall apply. Moreover, when goods are to be exported, the party concerned must declare the quantities of basic products, of products derived from the processing thereof, or of products assimilated to one of those categories in accordance with Article 1(2), which have actually been used, within the meaning of Article 3(2), in the manufacture of those goods, for which a refund will be requested, or otherwise refer to that composition if it has been determined in accordance with the third subparagraph of Article 3(2).
...
2. Where the party concerned does not draw up the declaration referred to in paragraph 1 or does not provide satisfactory information in support of his declaration, he shall not be entitled to a refund.
…
5. The quantities of goods exported and the quantities of the products referred to in the first subparagraph of paragraph 1 or a reference to the composition determined in accordance with the third subparagraph of Article 3(2) shall be entered on the document certifying exportation. However, where the second subparagraph of paragraph 2 of this Article applies, there shall be entered instead of the latter quantities, the quantities of basic products shown in column 4 of Annex D corresponding to the results of the analysis of the goods exported.
...’
Regulation (EEC) No 3665/87
9. Article 3(5) of Commission Regulation (EEC) No 3665/87 of 27 November 1987 laying down common detailed rules for the application of the system of export refunds on agricultural products (OJ 1987 L 351, p. 1), as amended by Commission Regulation (EC) No 2945/94 of 2 December 1994 (OJ 1994 L 310, p. 57) (‘Regulation No 3665/87’) provides:
‘The document used for export to enable products to qualify for a refund must include all information necessary for the calculation of the amount of the refund, and in particular:
(a) a description of the products in accordance with the nomenclature used for refunds;
(b) the net mass of the products or, where applicable, the unit of measurement to be taken into account in calculating the refund; and,
(c) in so far as is necessary for calculating the refund, particulars of the composition of the products or the relevant reference.
If the document mentioned in this paragraph is the export declaration, this document must also include these references and the reference refund code.’
10. Article 11 of Regulation No 3665/87, which applies to exports in respect of which the formalities referred to in Article 3 of the same regulation have been completed as from 1 April 1995, provides:
‘1. Where it has been found that an exporter, with a view to the granting of an export refund, has requested a refund in excess of that applicable, the refund due for the relevant exportation shall be the refund applicable to the actual exportation reduced by an amount equivalent to:
(a) half the difference between the refund requested and the refund applicable to the actual exportation;
(b) twice the difference between the refund requested and the refund applicable, if the exporter has intentionally supplied false information.
The refund requested is deemed to be the amount calculated from the information supplied pursuant to Article 3 or Article 25(2). …
The sanction referred to under (a) shall not apply:
…
– in cases where the request for the refund is in accordance with … Regulation (EC) No 1222/94 … and in particular Article 3(2) thereof, and has been calculated on the basis of the average quantities used over a specified period,
…
3. Without prejudice to the obligation to pay any negative amount as referred to in the fourth subparagraph of paragraph 1, where a refund is unduly paid, the beneficiary shall reimburse the amounts unduly received – which includes any sanction applicable pursuant to the first subparagraph of paragraph 1, – plus the interest calculated on the basis of the time elapsing between payment and reimbursement.
…’
Regulation (EEC) No 3846/87
11. Commission Regulation (EEC) No 3846/87 of 17 December 1987 establishing an agricultural product nomenclature for export refunds (OJ 1987 L 366, p. 1) establishes an agricultural product nomenclature for export refunds, based on the combined nomenclature.
12. Article 3 of that regulation is worded as follows:
‘The refund nomenclature shall be used by the Commission and the Member States for the application of Community measures relating to export refunds on agricultural products, and the numeric codes shall be entered on the documents provided for this purpose.
…
The Commission shall publish in the Official Journal of [the] European Communities
the full version of the refund nomenclature, as it follows from the regulatory provisions on export arrangements for agricultural products, that is to be used from 1 January each year.’
Main proceedings and question referred for a preliminary ruling
13. In 1996, Milupa exported to Turkey goods which did not fall within Annex II of the Treaty, and received the export refund for which it had applied. In the export document and the control copy T 5 it had stated, on the basis of the manufacturer’s declaration supplied, that a semi-prepared mixture had been used as an intermediate product, produced from fresh skimmed milk with a milk fat content, by weight, of 0.05%.
14. In December 1996, Milupa was informed that the mixture had been produced with skimmed milk concentrate with a milk fat content, by weight, of 0.14% to 0.19% and a non-fat dry matter content, by weight, of 29.31%. By letter of 22 January 1997, Milupa, in turn, notified the Hauptzollamt of the corrected information. By decisions of 11 and 12 February 1998, the Hauptzollamt demanded repayment by Milupa of the export refund which the latter had been granted.
15. On application by Milupa, the Finanzgericht Hamburg (Hamburg Finance Court) quashed the contested decisions, in so far as the Hauptzollamt was demanding repayment by Milupa of an amount corresponding to the export refund which would have been granted if skimmed milk concentrate had been used in the production of the exported goods. The reasoning given for the judgment of the Finanzgericht was that it was sufficient for the applicant to make a declaration that was essentially correct. Where only minor variations existed between the composition of the products used in the production of the exported goods as declared by the refund applicant, and their actual composition, the total loss of entitlement to the grant of an export refund was not a proportionate sanction, nor was it necessary for the avoidance of abuse, since the applicant would have received an export refund of virtually the same amount if the particulars declared had been correct.
16. The Hauptzollamt applied for review on a point of law (‘Revision’) to the referring court. In the circumstances, the Bundesfinanzhof decided to stay proceedings and to refer the following question to the Court of Justice for a preliminary ruling:
‘Are the second sentence of the first subparagraph of Article 7(1), the first subparagraph of Article 7(2) and Article 7(5) of Regulation (EC) No 1222/94, as amended by Regulation (EC) No 229/96, to be interpreted as meaning that the party concerned is not entitled to the grant of an export refund if, in the production of the exported goods, it was not the product declared by him, which under the first indent of Article 1(2)(c) of Regulation (EC) No 1222/94 is assimilated to skimmed milk powder of the type described in Annex A (PG 2), that was used but another product which, in respect of the non-fat part of its dry matter content, is also assimilated to skimmed milk powder of the type described in Annex A (PG 2) by virtue of the first indent of Article 1(2)(f) of Regulation (EC) No 1222/94?’
The question referred for a preliminary ruling
17. By its question, the referring court is essentially asking whether Article 7 of Regulation No 1222/94 is to be interpreted as meaning that, in the circumstances of the case in the main proceedings, the party concerned is not entitled to the grant of an export refund.
18. Both Milupa and the Commission maintain that the exporter cannot be denied the whole refund. Whilst Milupa maintains that Article 7 of Regulation No 1222/94 does not preclude such a refund, the Commission, for its part, claims that Article 11 of Regulation No 3665/87 provides for such a refund.
19. Milupa argues in particular that it had declared a product which is subject to the same assimilation rule as the product which had, in fact, been used, and that the refund which it had been granted was of more or less the same amount as that to which it was entitled. Milupa claims, therefore, that retaining the right to a refund is not contrary to the first subparagraph of Article 7(2) of Regulation No 1222/94. To withhold the refund completely would be neither useful nor necessary and would infringe the principle of proportionality.
20. In that respect, it must be noted that, according to the first sentence of the first subparagraph of Article 7(1) of Regulation No 1222/94, Regulation No 3665/87 is to apply in relation to refunds sought for agricultural products which are exported in the form of goods not covered by Annex II of the Treaty and which are covered by Regulation No 1222/94.
21. Furthermore, Article 7 of Regulation No 1222/94 contains certain special provisions which are specific to the nature of the products covered by that regulation. Thus, the second sentence of the first subparagraph of Article 7(1) of the aforementioned regulation provides that when goods are to be exported, the party concerned must declare the quantities of basic products, of products derived from the processing thereof, or of products assimilated to one of those two categories in accordance with Article 1(2), which have actually been used, within the meaning of Article 3(2), in the manufacture of those goods, for which a refund will be requested, or otherwise refer to that composition if it has been determined in accordance with the third subparagraph of Article 3(2).
22. Article 7(2) of Regulation No 1222/94 provides that ‘[w]here the party concerned does not draw up the declaration … or does not provide satisfactory information in support of his declaration, he shall not be entitled to a refund’. Milupa does not, however, appear to be in the position envisaged in that provision.
23. On the other hand, according to the wording of Article 11(1) of Regulation No 3665/87, which applies by virtue of the first sentence of the first subparagraph of Article 7(1) of Regulation No 1222/94, as referred to in point 20 of this judgment, the sanction provided for under that provision applies ‘[w]here it has been found that an exporter, with a view to the granting of an export refund, has requested a refund in excess of that applicable’. That clear wording does not include any reference to the assimilation rules in Article 1(2) of Regulation No 1222/94.
24. Moreover, whilst Article 7 of Regulation No 1222/94 contains certain special provisions which are specific to the nature of the products covered by that regulation, it must be noted that none of those conflicts with Article 11 of Regulation No 3665/87 as regards the application of that provision to the case in issue in the main proceedings.
25. The fourth indent of the third subparagraph of Article 11(1) of Regulation No 3665/87 states that the sanction provided for by that article is not to apply where the request for a refund is in accordance with Regulation No 1222/94. It may therefore be deduced from that provision that the said sanction does apply where a request for a refund in excess of that applicable, submitted pursuant to Regulation No 1222/94, is not in accordance with the latter.
26. As regards the assessment in the light of the principle of proportionality of that same sanction being applied to an exporter who, through no fault of his own, has requested a refund in excess of that applicable, the Court has already held that the sanction does not breach that principle, since it cannot be considered to be inappropriate for attaining the objective pursued by Community law, namely to combat irregularities and fraud, and does not go beyond what is necessary to achieve that objective (Case C-210/00 Käserei Champignon Hofmeister
[2002] ECR I‑6453, paragraph 68).
27. Thus, the answer to the question referred to the Court must be that the second sentence of the first subparagraph of Article 7(1), the first subparagraph of Article 7(2) and Article 7(5) of Regulation No 1222/94, are to be interpreted as meaning that where an exporter has declared in a request for an export refund that, in the production of the goods in issue, a product was used which, by virtue of Article 1(2) of that regulation, is assimilated to the skimmed milk powder described in Annex A (PG 2), whereas in fact another product was used which, by virtue of the same provision, is also assimilated to the same skimmed milk powder, he is entitled to the grant of an export refund, corrected if appropriate in accordance with Article 11 of Regulation No 3665/87.
Costs
28. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
Operative part
On those grounds, the Court (Third Chamber) rules as follows:
The second sentence of the first subparagraph of Article 7(1), the first subparagraph of Article 7(2) and Article 7(5) of Commission Regulation (EC) No 1222/94 of 30 May 1994 laying down common detailed rules for the application of the system of granting export refunds on certain agricultural products exported in the form of goods not covered by Annex II to the Treaty, and the criteria for fixing the amount of such refunds, as amended by Commission Regulation (EC) No 229/96 of 7 February 1996, are to be interpreted as meaning that where an exporter has declared in a request for an export refund that, in the production of the goods in issue, a product was used which, by virtue of Article 1(2) of that regulation, is assimilated to the skimmed milk powder described in Annex A (PG 2), whereas in fact another product was used which, by virtue of the same provision, is also assimilated to the same skimmed milk powder, he is entitled to the grant of an export refund, corrected if appropriate in accordance with Article 11 of Commission Regulation (EEC) No 3665/87 of 27 November 1987 laying down common detailed rules for the application of the system of export refunds on agricultural products, as amended by Commission Regulation (EC) No 2945/94 of 2 December 1994.