61990CJ0246_EN
Parties
Grounds
Decision on costs
Operative part
Parties
In Case C-246/90,
REFERENCE to the Court under Article 177 of the EEC Treaty by the Finanzgericht (Finance Court) Muenchen for a preliminary ruling in the proceedings pending before that court between
Parma Handelsgesellschaft mbH
and
Hauptzollamt Bad Reichenhall,
on the interpretation of Commission Regulation (EEC) No 1626/85 of 14 June 1985 on protective measures applicable to imports of certain Morello cherries (OJ 1985 L 156, p. 13), as amended by Commission Regulation (EEC) No 1712/85 of 21 June 1985 amending the German, Greek, English, French, Italian and Dutch versions of Regulation (EEC) No 1626/85 (OJ 1985 L 163, p. 46),
THE COURT (Fourth Chamber),
composed of: P.J.G. Kapteyn, President of the Chamber, C.N. Kakouris and M. Diez de Velasco, Judges,
Advocate General: G. Tesauro,
Registrar: J.A. Pompe, Deputy Registrar,
after considering the written observations submitted on behalf of:
° Parma Handelsgesellschaft, by Hinrich Glashoff and Herbert Kuehle, tax advisers,
° the Commission of the European Communities, by René Barents, Legal Adviser, subsequently replaced by Joern Sack, Legal Adviser, acting as Agents, assisted by Roberto Hayder, an official of the Federal Ministry for Economic Affairs of the Federal Republic of Germany, seconded to the Commission' s Legal Service under the scheme for exchanges with national officials,
having regard to the Report for the Hearing,
after hearing the oral observations of Parma Handelsgesellschaft and the Commission at the hearing on 14 January 1992,
after hearing the Opinion of the Advocate General at the sitting on 26 February 1992,
gives the following
Judgment
Grounds
1 By order dated 10 July 1990, received at the Court on 13 August 1990, the Finanzgericht (Finance Court) Muenchen referred to the Court for a preliminary ruling pursuant to Article 177 of the EEC Treaty two questions on the interpretation of Commission Regulation (EEC) No 1626/85 of 14 June 1985 on protective measures applicable to imports of certain Morello cherries (OJ 1985 L 156, p. 13), as amended by Commission Regulation (EEC) No 1712/85 of 21 June 1985 amending the German, Greek, English, French, Italian and Dutch versions of Regulation (EEC) No 1626/85 (OJ 1985 L 163, p. 46).
2 Those questions were raised in proceedings between Parma Handelsgesellschaft mbH ("Parma") and Hauptzollamt (principal customs office) Bad Reichenhall ° Zollamt Autobahn ("the principal customs office") concerning a countervailing charge imposed by the principal customs office pursuant to that regulation.
3 Regulation No 1626/85 fixes a minimum import price as a safeguard measure with regard to the importation of certain Morello cherries, including "Morello cherries in syrup". Article 1(1) provides for a minimum price for Morello cherries not containing added sugar which is lower than that laid down for Morello cherries in syrup.
4 In order to define the said Morello cherries, Regulation No 1626/85 refers to the terms of the Common Customs Tariff ("CCT") which at the material time was the version laid down in Council Regulation (EEC) No 3400/84 of 27 November 1984 amending Regulation (EEC) No 950/68 on the Common Customs Tariff (OJ 1984 L 320, p. 1). Article 1(1) of Regulation No 1626/85 defines Morello cherries as follows:
"...
ex 20.06 Fruit otherwise prepared or preserved, whether or not containing added sugar:
B.II. Not containing added spirit:
a) Containing added sugar, in immediate packings of a net capacity of more than 1 kg:
ex 8. Morello cherries in syrup
b) Containing added sugar, in immediate packings of a net capacity of 1 kg or less:
ex 8. Morello cherries in syrup
...".
5 Under Article 1(2), if the minimum import price is not respected, a countervailing charge as set out in the annex to Regulation No 1626/85 is to be applied.
6 According to the order for reference, between 29 July and 3 September 1985 Parma put into free circulation various consignments of a product called stewed Morello cherries (Dunstsauerkirschen), imported from Yugoslavia. In some of the customs declarations, the goods were described as "fruit otherwise prepared or preserved, not containing added alcohol or sugar, own sugar content between 9% and 13%, in immediate packings of a net capacity of 1 kg or more". In other declarations, the same goods were described as "fruit, not containing added sugar".
7 The principal customs office took the view that the goods were "Morello cherries in syrup" for which the minimum price had not been respected and, by decision of 18 September 1985 which was varied on 17 July 1989 following a complaint from Parma, fixed countervailing charges for the various consignments of goods, ultimately demanding payment of a total of DM 67 638.14.
8 Parma brought an action against that decision in the Finanzgericht Muenchen on the ground that it had not imported Morello cherries in syrup but Morello cherries in water. It argued in that connection that, for the purposes of Regulation No 1626/85, Morello cherries in syrup were Morello cherries to which sugar syrup had been added in order to preserve them. Parma further claimed that, in order to determine the minimum price, account should have been taken of only the weight of the Morello cherries as such, since the weight of the water could be taken into consideration in order to calculate, not the weight of the cherries, but the weight of their packing.
9 The Finanzgericht Muenchen took the view that the resolution of the dispute depended on the interpretation of Regulation No 1626/85, cited above, and therefore decided to suspend the proceedings and refer the following questions to the Court for a preliminary ruling:
"1. Is Article 1(1) of Regulation (EEC) No 1626/85, as amended by Regulation (EEC) No 1712/85, to be interpreted as meaning that Morello cherries in a liquid derived from heating such cherries in water and which for that reason has a sugar content greater than 9% must be classified as Morello cherries in syrup under tariff subheadings 20.06 B II a) 8 or 20.06 B II b) 8 of the Common Customs Tariff?
2. Is Article 1(1) of the regulation referred to in Question 1 to be interpreted as meaning that the minimum price for imports of Morello cherries in syrup must be computed on the basis of the combined weight of the Morello cherries and the syrup?"
10 Reference is made to the Report for the Hearing for a fuller account of the facts of the case, the Community legislation at issue, the procedure and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.
The first question
11 In order to answer the first question, it should be borne in mind that, according to Additional Note 3 to Chapter 20 of the CCT, products classified under heading No 20.06 are to be considered as "containing added sugar" when their "sugar content" exceeds by weight the percentages given hereunder, according to the kind of fruit concerned:
° pineapples and grapes: 13%
° other fruits, including mixtures of fruit: 9%.
12 Parma argues essentially that that note cannot be taken into account. It considers that subheading 20.06 B II a) of the CCT covers fruits containing added sugar generally, whereas Article 1(1) of Regulation No 1626/85, cited above, which expressly mentions "Morello cherries in syrup" in the category of fruit "containing added sugar", is specifically intended to restrict the application of the rules on the minimum price to Morello cherries contained in sugar syrup. In Parma' s view, the difference between such Morello cherries and the Morello cherries at issue in the main proceedings lies not in their sugar content, but in the fact that sugar has actually been added to "Morello cherries in syrup".
13 That interpretation cannot be accepted.
14 Regulation No 1626/85 contains no definition of "sugar syrup". However, in order to define the goods in question, that regulation refers to subheadings 20.06 B II a) 8 and b) 8 of the CCT. That reference has to be construed as encompassing all the relevant legislation, namely the general rules for the interpretation of the nomenclature of the CCT, the notes to each chapter of the CCT and the explanatory notes on the nomenclature of the Customs Cooperation Council ("the explanatory notes").
15 It should first be observed that, not only do all those notes and general rules contain no definition of "sugar syrup" in the sense proposed by Parma, but they give indications conflicting with such a definition. For example, the explanatory notes on heading 17.02 of the CCT, which apply inter alia to "sugar syrups, not containing added flavouring or colouring matter" specify under Part B that that heading covers "syrups of all sugars (other than aqueous solutions of chemically pure sugars of heading 29.43), provided they do not contain added flavouring or colouring matter". They also state that that heading of the CCT covers syrups referred to in Part A, which cites, by way of example, glucose, which occurs naturally in fruits, and fructose. It follows that those notes, which do not indicate the origin of the sugar contained in the syrups, do not exclude syrups obtained as a result of the sugar contained in the Morello cherries themselves.
16 Furthermore, heading 20.06 of the CCT, to which Article 1 of Regulation No 1626/85 refers, covers fruits whether or not containing added sugar. However, the criterion for the addition or otherwise of sugar to Morello cherries in syrup is provided by Additional Note 3 to Chapter 20 of the CCT, cited above, from which it appears that such products are to be regarded as "containing added sugar" where their sugar content exceeds 9%.
17 Likewise, Article 1(2)(c) of Commission Regulation (EEC) No 1599/84 of 5 June 1984 laying down detailed rules for the application of the system of production aid for products processed from fruit and vegetables (OJ 1984 L 152, p. 16) defines a similar product, namely "cherries in syrup", as "cherries, pitted or not, having undergone heat treatment, packed in hermetically sealed containers with a covering liquid of sugar syrup and falling within subheading 20.06 B II a) 8 or 20.06 B II b) 8 of the Common Customs Tariff"; Article 1(2)(p) defines "sugar syrup" as meaning "a liquid in which water is combined with sugars and which has a total sugar content determined after homogenization of not less than 9% in respect of cherries in syrup".
18 It follows from the aforementioned provisions that the legislature refers to the criterion of the total sugar content of the liquid containing the Morello cherries, which, being based on an intrinsic characteristic and an objective property of the product, is a stable and easily employed criterion. In contrast, the criterion of the origin of the sugars, which is difficult to apply, cannot fulfil the requirements of legal certainty and ease of checking.
19 Parma also argues that the covering liquid for the Morello cherries, which contains no sugar added subsequently, is used solely for pasteurization and in order to protect the Morello cherries against dehydration and shock during transportation and storage. In its view, such a liquid has no value as a foodstuff for the ultimate consumer.
20 That argument cannot be accepted either, since the intended use of a product can be taken into account for the purpose of its tariff classification only if the wording of the heading, or the note referring to it, makes an express reference to that criterion (see, in particular, the judgment in Case C-219/89 Wesergold [1991] ECR I-1895, paragraph 9). The subheadings at issue make no such reference.
21 It follows from all the above considerations that Article 1(1) of Regulation No 1626/85, as amended by Regulation No 1712/85, is to be interpreted as meaning that Morello cherries in a liquid derived from heating them in water which for that reason has a sugar content greater than 9% must be classified as "Morello cherries in syrup" within the meaning of Regulation No 1626/85, and consequently fall within tariff subheadings 20.06 B II a) 8 and 20.06 B II b) 8 of the CCT.
The second question
22 In Parma' s view, the liquid in which the Morello cherries are contained cannot be regarded as packing but as a product in its own right, of no value, since its function is to ensure the pasteurization and protection of the Morello cherries. It therefore considers that the weight of that liquid cannot be taken into account when calculating the weight of the cherries.
23 That argument cannot be accepted.
24 As the Commission pointed out in its written observations, under general rule A.1 for the interpretation of the nomenclature of the CCT, classification is to be determined for legal purposes according to the terms of the headings and any relevant section or chapter notes. That rule, which is applicable to tariff classification, must also be applied where a regulation, other than the CCT, refers to the CCT for the purposes of its application.
25 Article 1(1) of Regulation No 1626/85 refers to heading 20.06 of the CCT, which defines the goods at issue in the main proceedings not as "Morello cherries" but as "Morello cherries in syrup". Accordingly, the weight of the syrup must be taken into account in calculating the minimum price.
26 Furthermore, that interpretation is consistent with the Court' s case-law, according to which the decisive criterion for the customs classification of goods must be sought generally in their objective characteristics and qualities, as defined by the wording of the headings and subheadings of the CCT and by the notes to its sections and chapters (see, in particular, the judgment in Case C-120/90 Ludwig Post [1991] ECR I-2391, paragraph 11). As has already been stated, the intended use of a product can be taken into account for the purpose of its tariff classification only if the wording of the heading, or the note referring to it, makes an express reference to that criterion (see paragraph 20, above).
27 Consequently, the answer to the national court' s second question must be that Article 1(1) of Regulation No 1626/85, as amended by Regulation No 1712/85, is to be interpreted as meaning that the minimum price for imports of Morello cherries in syrup must be calculated on the basis of the combined weight of the Morello cherries and the syrup.
Decision on costs
Costs
28 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 proceedings pending before the national court, the decision on costs is a matter for that court.
Operative part
On those grounds,
THE COURT (Fourth Chamber),
in answer to the questions referred to it by the Finanzgericht Muenchen by order of 10 July 1990, hereby rules:
1. Article 1(1) of Commission Regulation (EEC) No 1626/85 of 14 June 1985 on protective measures applicable to imports of certain Morello cherries, as amended by Commission Regulation (EEC) No 1712/85 of 21 June 1985 amending the German, Greek, English, French, Italian and Dutch versions of Regulation (EEC) No 1626/85, is to be interpreted as meaning that Morello cherries in a liquid derived from heating them in water which for that reason has a sugar content greater than 9% must be classified as "Morello cherries in syrup" within the meaning of Regulation No 1626/85, and consequently fall within tariff subheadings 20.06 B II a) 8 and 20.06 B II b) 8 of the Common Customs Tariff.
2. Article 1(1) of Regulation No 1626/85, as amended by Regulation No 1712/85, is to be interpreted as meaning that the minimum price for imports of Morello cherries in syrup must be calculated on the basis of the combined weight of the Morello cherries and the syrup.