61991CJ0292_EN
Parties
Grounds
Decision on costs
Operative part
Parties
In Case C-292/91,
REFERENCE to the Court under Article 177 of the EEC Treaty by the Finanzgericht Muenchen for a preliminary ruling in the proceedings pending before that court between
Gebrueder Weis GmbH
and
Hauptzollamt Wuerzburg
on the recovery of customs duties in connection with outward processing arrangements,
THE COURT (Fifth Chamber),
composed of: G.C. Rodríguez Iglesias, President of the Chamber, R. Joliet, J.C. Moitinho de Almeida, F. Grévisse and D.A.O. Edward, Judges,
Advocate General: W. Van Gerven,
Registrar: J.-G. Giraud,
after considering the written observations submitted on behalf of the Commission of the European Communities by Joern Sack, Legal Adviser,
having regard to the Report of the Judge-Rapporteur,
after hearing the Opinion of the Advocate General at the sitting on 10 December 1992,
gives the following
Judgment
Grounds
1 By order of 13 September 1991, received at the Court on 20 November 1991, the Finanzgericht Muenchen referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty two questions on the interpretation of Articles 366 and 368 of the Act concerning the conditions of accession of the Kingdom of Spain and the Portuguese Republic and the adjustments to the Treaties (OJ 1985 L 302, p. 23, hereinafter "the Act of Accession"), of Article 1 of Protocol 3 to the Cooperation Agreement signed at Belgrade on 2 April 1980 between the European Economic Community and the Socialist Federal Republic of Yugoslavia (OJ 1983 L 41, p. 2, hereinafter "the Agreement") and of Article 1 of Council Regulation (EEC) No 449/86 of 24 February 1986 determining the arrangements to be applied by the Kingdom of Spain and the Portuguese Republic to trade with certain third countries (OJ 1986 L 50, p. 40).
2 The questions arose in proceedings between Gebrueder Weis GmbH ("Weis") and the Hauptzollamt Wuerzburg ("the Hauptzollamt") concerning post-clearance recovery of customs duties on import.
3 The documents before the Court show that during 1986 and 1987 Weis sent to firms in Yugoslavia, in the course of duly authorized outward processing arrangements, fabrics originating inter alia in Portugal. The fabrics were sent to Yugoslavia via the Zollamt Aschaffenburg ("the Zollamt"). There they were processed into men' s garments. The finished products were returned to the Community via the same Zollamt.
4 On the occasion of each customs clearance before processing, Weis filled in movement certificates which were submitted to the Zollamt for endorsement. For the finished products the Zollamt received certificates duly completed by the Yugoslav authorities which it accepted as proof of the Community origin of the raw materials. The worked products were then released for consumption free of duty as goods covered by a preferential system under Article 15 of the Agreement.
5 Article 15 of the Agreement provides inter alia that industrial products "originating in Yugoslavia ... shall be imported into the Community free of quantitative restrictions and measures having equivalent effect, and of customs duties and charges having equivalent effect". Under Article 30 of the Agreement "products originating in the Community" are to be considered "products originating in Yugoslavia" on condition that they have undergone in Yugoslavia working or processing which is not "insufficient" within the meaning of Article 3(3) of Protocol 3. It is common ground that that last condition was satisfied in the case at issue in the main proceedings.
6 Following a check carried out by the Oberfinanzdirektion Nuernberg, the Hauptzollamt decided, by a corrective decision, to levy customs duties on the ground that, in the context of the transitional scheme applicable to products originating in Portugal, according to which goods traded between Portugal and the other Member States were subject to residual customs duties, the fabrics in question were not to be regarded as "originating in the Community".
7 Weis contested that decision before the Finanzgericht Muenchen and in the course of the proceedings claimed that the internal rules on trade between the Community of Ten and Portugal could not be decisive for the interpretation of the Agreement, Article 30 of which refers unconditionally to "originating products". Weis further claimed that it was entitled to the protection of its legitimate expectations arising from the interpretation made by the authorities in 1986 and 1987.
8 The Finanzgericht Muenchen took the view that the decision in the case turned on an interpretation of Community law. It therefore referred the following questions to the Court for a preliminary ruling:
"1. Are Articles 366 and 368 of the Act concerning the conditions of accession of the Kingdom of Spain and the Portuguese Republic, read in conjunction with Article 1 of Regulation (EEC) No 449/86 of 24 February 1986 to be interpreted as meaning that, in trade in 1986 between the Federal Republic of Germany and Yugoslavia, goods originating in Portugal within the meaning of Protocol 3 to the Cooperation Agreement between the EEC and the Socialist Federal Republic of Yugoslavia were to be regarded as goods originating in the Community, and is this issue determined according to whether or not the goods were in free circulation within the Community as previously constituted?
2. If Question 1 is answered in the negative:
Could an error on the part of the customs authority, as a result of which the goods in question were treated as goods originating within the Community, reasonably have been detected by the trader?"
9 Reference is made to the Report of the Judge-Rapporteur for a fuller account of the facts in the main proceedings, the procedure and the written observations submitted to the Court, which are hereinafter mentioned only in so far as is necessary for the reasoning of the Court.
10 If the answer to the first question is in the affirmative, then Weis does not owe the customs duties demanded of it. Nor is the duty owed if the answer to the first question is in the negative, provided that a negative answer is also given to the national court' s second question.
11 In the circumstances of this case it is appropriate first to consider the second question.
12 By that question the Finanzgericht is asking whether, if the Zollamt were in error in thinking that products originating in Portugal were at the time "products originating in the Community", that error ought to have been detected by a trader such as Weis.
13 As the Commission and the Advocate General have correctly observed, that question must be answered in the light of Article 5(2) of Council Regulation (EEC) No 1697/79 of 24 July 1979 on the post-clearance recovery of import duties or export duties which have not been required of the person liable for payment on goods entered for a customs procedure involving the obligation to pay such duties (OJ 1979 L 197, p. 1).
14 That provision lays down three concurrent conditions which must be met for the competent customs authorities to be able to refrain from taking action for the post-clearance recovery of import duties, namely that the duties were not collected as a result of an error made by the competent authorities, that the person liable has acted in good faith and observed all the provisions laid down by the rules in force as far as his customs declaration is concerned (Case 314/85 Foto-Frost v Hauptzollamt Luebeck-Ost [1987] ECR 4199, paragraphs 22 to 26).
15 As the Court has consistently held, and as has been confirmed in particular by the judgment in Case C-348/89 Mecanarte [1991] ECR I-3299, that means that if all those conditions are satisfied the person liable is entitled to waiver of recovery of the duty in question.
16 The second question raised by the court of reference is essentially whether, if the first and third conditions are met, the second condition, that is, the condition of good faith, is satisfied in the case of a trader such as Weis.
17 It is sufficient to state in that respect that if it is accepted that, for the application of the Agreement, products originating in Portugal ought not, even after Portugal' s accession to the Communities, to have been regarded as "products originating in the Community", that was far from being detectable from a mere reading of the provisions in force by a trader such as Weis. The condition of good faith must therefore be regarded as being satisfied.
18 The answer to the second question raised by the Finanzgericht Muenchen must therefore be that in so far as a customs authority wrongly considered that products originating in Portugal were to be regarded, for the purposes of the application of the Cooperation Agreement signed between the Community and the Socialist Federal Republic of Yugoslavia, as goods originating in the Community, where customs duties were not charged and where the importer observed all the provisions laid down by the rules in force as regards his customs declaration, the customs duties are not recoverable.
19 In view of the answer thus given to the second question, there is no need to give a ruling on the first question.
Decision on costs
Costs
20 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. 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.
Operative part
On those grounds,
THE COURT (Fifth Chamber),
in answer to the questions referred to it by the Finanzgericht Muenchen by order of 13 September 1991, hereby rules:
In so far as a customs authority wrongly considered that products originating in Portugal were to be regarded, for the purposes of the application of the Cooperation Agreement signed between the Community and the Socialist Federal Republic of Yugoslavia, as goods originating in the Community, where customs duties were not charged and where the importer observed all the provisions laid down by the rules in force as regards his customs declaration, the customs duties are not recoverable.