Judgment of the Court (Second Chamber) of 26 March 1981. - Dr. Ritter GmbH & Co. v Oberfinanzdirektion Hamburg. - Reference for a preliminary ruling: Bundesfinanzhof - Germany. - Common customs tariff - Tonic made of brewer's yeast. - Case 114/80.



European Court reports 1981 Page 00895



Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

1 . COMMON CUSTOMS TARIFF - TARIFF HEADINGS - ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' WITHIN THE MEANING OF HEADING 22.02 - CONCEPT - DEFINITION - OBJECTIVE AND VERIFIABLE CRITERIA - BASIC INGREDIENTS - NOT RELEVANT

2 . COMMON CUSTOMS TARIFF - TARIFF HEADINGS - ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' WITHIN THE MEANING OF HEADING 22.02 - CONCEPT - TONIC COMPOSED OF BREWER ' S YEAST , WATER AND CITRUS-FRUIT JUICE - INCLUDED

Summary

1 . IN CONFORMITY WITH THE STRUCTURE OF THE COMMON CUSTOMS TARIFF THE EXPRESSION ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' IN HEADING 22.02 IS TO BE UNDERSTOOD AS BEING A GENERIC CONCEPT EMBRACING ALL LIQUIDS INTENDED FOR HUMAN CONSUMPTION IN SO FAR AS THEY ARE NOT INCLUDED IN ANY OTHER SPECIFIC CLASSIFICATION .

THE SCOPE OF THE CONCEPT MUST BE DETERMINED ON THE BASIS OF CRITERIA WHICH ARE BOTH OBJECTIVE AND VERIFIABLE . IT IS NOT PERMISSIBLE , THEREFORE , TO MAKE ITS SCOPE DEPENDENT ON PURELY SUBJECTIVE , VARIABLE FACTORS SUCH AS THE MANNER IN WHICH THE PRODUCT IS TAKEN OR THE PURPOSE FOR WHICH IT IS CONSUMED .

MOREOVER , THE CLASSIFICATION OF A PRODUCT AS A BEVERAGE WITHIN THE MEANING OF TARIFF HEADING 22.02 CANNOT DEPEND ON THE BASIC INGREDIENTS USED .

' ' BEVERAGES ' ' , WITHIN THE MEANING OF HEADING 22.02 , MUST BE UNDERSTOOD AS SIGNIFYING ANY LIQUID SUITABLE , AND INTENDED , FOR HUMAN CONSUMPTION , REGARDLESS OF THE QUANTITY IN WHICH IT IS ABSORBED OR THE SPECIAL PURPOSES FOR WHICH VARIOUS KINDS OF LIQUIDS MAY BE CONSUMED .

2 . THE CONCEPT OF ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' IN HEADING 22.02 OF THE COMMON CUSTOMS TARIFF MUST BE INTERPRETED AS INCLUDING A PRODUCT COMPOSED OF BREWER ' S YEAST , WATER AND 3.9% NATURAL CITRUS-FRUIT JUICE , PUT UP IN LIQUID FORM AND POTABLE , AND INTENDED TO BE TAKEN SEVERAL TIMES DAILY IN SMALL QUANTITIES FOR THE IMPROVEMENT OF HEALTH .

Parties

IN CASE 114/80 ,

REFERENCE TO THE COURT UNDER ARTICLE 177 OF THE EEC TREATY BY THE BUNDESFINANZHOF ( FEDERAL FINANCE COURT ) FOR A PRELIMINARY RULING IN THE ACTION PENDING BEFORE THAT COURT BETWEEN

DR RITTER GMBH & CO , WITH REGISTERED OFFICIES IN KOLN-DEUTZ ,

V

OBERFINANZDIREKTION ( PRINCIPAL FINANCE OFFICE ) HAMBURG ,

Subject of the case

ON THE INTERPRETATION OF HEADINGS 21.06 AND 22.02 OF THE COMMON CUSTOMS TARIFF ,

Grounds

1 BY AN ORDER DATED 1 APRIL 1980 WHICH WAS RECEIVED AT THE COURT ON 2 MAY 1980 THE BUNDESFINANZHOF REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER ARTICLE 177 OF THE EEC TREATY TWO QUESTIONS AS TO THE INTERPRETATION OF HEADING 22.02 , OR ALTERNATIVELY HEADING 21.06 , OF THE COMMON CUSTOMS TARIFF .

2 IT APPEARS FROM THE FILE ON THE CASE THAT THE PLAINTIFF IN THE MAIN ACTION REQUESTED A BINDING CUSTOMS TARIFF RULING FROM THE REVENUE AUTHORITIES FOR A PRODUCT CALLED ' ' WHOLE YEAST ' ' AND DESCRIBED IN THE ORDER MAKING THE REFERENCE IN THE FOLLOWING TERMS : ' ' THE PRODUCT IS COMPOSED OF ( INACTIVE ) BREWER ' S YEAST , WATER AND 3.9% NATURAL CITRUS-FRUIT JUICE . IT IS LIQUID AND SUITABLE FOR DIRECT CONSUMPTION AS A BEVERAGE . ACCORDING TO THE WORDING ON THE WRAPPING IT SERVES AS A FOOD SUPPLEMENT , HELPS TO MAINTAIN WORKING CAPACITY AND GIVES THE SKIN A HEALTHY COMPLEXION . FROM ONE TO THREE TABLESPOONFULS MUST BE TAKEN THREE TIMES A DAY . ' '

3 THE REVENUE AUTHORITIES ARE OF THE OPINION THAT THE PRODUCT IN QUESTION SHOULD BE CLASSIFIED AS A ' ' BEVERAGE ' ' UNDER HEADING 22.02 BECAUSE IT IS A PRODUCT SUITABLE FOR DIRECT CONSUMPTION AS A BEVERAGE , REGARDLESS OF ITS COMPOSITION , MODE OF CONSUMPTION AND THE PURPOSE FOR WHICH IT IS DRUNK . THE PLAINTIFF ON THE OTHER HAND CONTENDS THAT THE PRODUCT IN QUESTION , THE MAIN INGREDIENT OF WHICH IS BREWER ' S YEAST , SHOULD BE CLASSIFIED AS A YEAST UNDER HEADING 21.06 .

4 THE BUNDESFINANZHOF CONSIDERS THAT A DECISION DEPENDS ON THE INTERPRETATION OF THE WORD ' ' BEVERAGES ' ' IN HEADING 22.02 , ACCORDING TO WHETHER THAT TERM IS TO BE UNDERSTOOD AS INCLUDING ALL LIQUIDS INTENDED FOR HUMAN CONSUMPTION , OR ONLY THOSE PRODUCTS INTENDED TO QUENCH THIRST WHICH THE WORD IS COMMONLY USED TO DENOTE . IN THE LATTER CASE A LIQUID SUCH AS THAT IN QUESTION WHICH IS INTENDED TO BE TAKEN FOR HEALTH REASONS SHOULD NOT BE CLASSIFIED AS A ' ' BEVERAGE ' ' .

5 IN ORDER TO CLARIFY THE ISSUE THE BUNDESFINANZHOF HAS PUT THE FOLLOWING QUESTIONS :

1 . IS THE EXPRESSION ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' WITHIN THE MEANING OF TARIFF HEADING 22.02 OF THE COMMON CUSTOMS TARIFF TO BE INTERPRETED AS INCLUDING A PRODUCT WHICH IS COMPOSED OF BREWER ' S YEAST , WATER AND 3.9% NATURAL CITRUS-FRUIT JUICE , IS LIQUID AND SUITABLE FOR CONSUMPTION AS A BEVERAGE AND IS INTENDED TO BE TAKEN SEVERAL TIMES DAILY IN SMALL QUANTITIES FOR THE IMPROVEMENT OF HEALTH?

2 . IF QUESTION 1 IS ANSWERED IN THE NEGATIVE : IS TARIFF HEADING 21.06 TO BE INTERPRETED , IN CONJUNCTION WITH GENERAL RULE 3 ( B ) FOR THE INTERPRETATION OF THE COMMON CUSTOMS TARIFF , AS INCLUDING THE PRODUCT DESCRIBED ABOVE?

6 THE TARIFF HEADINGS REFERRED TO IN THE QUESTIONS FORM PART OF CHAPTER 21 OF THE TARIFF , ENTITLED ' ' MISCELLANEOUS EDIBLE PREPARATIONS ' ' , AND CHAPTER 22 , ENTITLED ' ' BEVERAGES , SPIRITS AND VINEGAR ' ' . IN SO FAR AS THEY ARE RELEVANT TO THE DISPUTE , THEY ARE WORDED AS FOLLOWS :

21.06 NATURAL YEASTS (. . . INACTIVE ) . . . OTHER .

22.02 LEMONADE , FLAVOURED SPA WATERS AND FLAVOURED AERATED WATERS , AND OTHER NON-ALCOHOLIC BEVERAGES , NOT INCLUDING FRUIT AND VEGETABLE JUICES FALLING WITHIN HEADING NO 20.07 .

7 IN CONFORMITY WITH THE STRUCTURE OF THE COMMON CUSTOMS TARIFF THE EXPRESSION ' ' OTHER . . . BEVERAGES ' ' IN HEADING 22.02 IS TO BE UNDERSTOOD AS A GENERIC CONCEPT EMBRACING ALL LIQUIDS INTENDED FOR HUMAN CONSUMPTION , IN SO FAR AS THEY ARE NOT INCLUDED IN ANY OTHER SPECIFIC CLASSIFICATION .

8 THE SCOPE OF THAT CONCEPT MUST BE DETERMINED ON THE BASIS OF CRITERIA WHICH ARE BOTH OBJECTIVE AND VERIFIABLE . IT IS NOT PERMISSIBLE , THEREFORE , TO MAKE ITS SCOPE DEPENDENT ON PURELY SUBJECTIVE , VARIABLE FACTORS SUCH AS THE MANNER IN WHICH THE PRODUCT IS TAKEN OR THE PURPOSE FOR WHICH IT IS CONSUMED , TO QUENCH THIRST , FOR EXAMPLE , TO IMPROVE HEALTH , OR FOR SOME OTHER PURPOSE . WITHIN THE MEANING OF THAT HEADING THEREFORE , ' ' BEVERAGES ' ' MUST BE UNDERSTOOD TO SIGNIFY ANY LIQUID SUITABLE AND INTENDED FOR HUMAN CONSUMPTION REGARDLESS OF THE QUANTITY IN WHICH IT IS ABSORBED , OR THE SPECIAL PURPOSES FOR WHICH VARIOUS KINDS OF LIQUIDS MAY BE CONSUMED .

9 THE CLASSIFICATION OF A PRODUCT AS A BEVERAGE WITHIN THE MEANING OF HEADING 22.02 CANNOT , MOREOVER , DEPEND ON THE BASIC INGREDIENTS USED . THE DISTINGUISHING CHARACTERISTIC IN THE TARIFF HEADING IN QUESTION IS THE FACT THAT THE PRODUCTS IN QUESTION ARE LIQUIDS AND ARE INTENDED FOR HUMAN CONSUMPTION . ALTHOUGH THE PRODUCT IN QUESTION IS MADE BASICALLY FROM YEAST , WHICH FALLS UNDER HEADING 21.06 , THE DECISIVE CHARACTERISTIC AS FAR AS CLASSIFICATION IN THE TARIFF IS CONCERNED IS ITS LIQUID STATE , CHIEFLY OBTAINED BY ADDING WATER , AND NOT THE BASIC INGREDIENT EMPLOYED .

10 THAT REASONING IS SUPPORTED BY THE ACTUAL WORDING OF THE HEADING IN QUESTION WHICH , AFTER REFERRING TO ' ' BEVERAGES ' ' IN GENERAL , EXPRESSLY EXCLUDES FRUIT AND VEGETABLE JUICES WHICH ARE INCLUDED IN HEADING 20.07 IN CHAPTER 20 , COVERING ' ' PREPARATIONS OF VEGETABLES , FRUIT OR OTHER PARTS OF PLANTS ' ' . THAT INDICATES THAT WITHOUT THAT EXPRESS EXCEPTION THE JUICES IN QUESTION WOULD BE CLASSIFIED IN THE CHAPTER ON BEVERAGES , AND NOT IN THAT COVERING THE RELEVANT BASIC INGREDIENTS .

11 A SIMILAR INDICATION IS TO BE FOUND IN THE EXPLANATORY NOTES TO THE COMMON CUSTOMS TARIFF WHICH EXCLUDE ' ' TONIC PREPARATIONS ' ' FROM HEADING 21.07 ( WHICH , TOGETHER WITH YEASTS , IS INCLUDED IN THE CHAPTER ON EDIBLE PREPARATIONS ) WHEN THEY ARE PUT UP AS LIQUIDS SUITABLE FOR DIRECT CONSUMPTION AS BEVERAGES . THE UNDERLYING PRINCIPLE OF THAT NOTE MAY BE EXTENDED BY ANALOGY TO THE AQUEOUS DILUTION OF YEAST LIKE THAT UNDER CONSIDERATION IN THE PRESENT CASE .

12 THE REPLY TO THE FIRST QUESTION MUST THEREFORE BE THAT THE CONCEPT OF ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' IN HEADING 22.02 OF THE COMMON CUSTOMS TARIFF MUST BE INTERPRETED AS INCLUDING A PRODUCT COMPOSED OF BREWER ' S YEAST , WATER AND 3.9% NATURAL CITRUS FRUIT JUICE , PUT UP IN LIQUID FORM AND POTABLE , AND INTENDED TO BE TAKEN SEVERAL TIMES DAILY IN SMALL QUANTITIES FOR THE IMPROVEMENT OF HEALTH .

13 IT IS THEREFORE UNNECESSARY TO REPLY TO THE SECOND QUESTION .

Decision on costs

14 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES WHICH HAS SUBMITTED OBSERVATIONS TO THE COURT ARE NOT RECOVERABLE . AS THE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED , IN THE NATURE OF A STEP IN THE PROCEEDINGS BEFORE THE NATIONAL COURT , THE DECISION AS TO COSTS IS A MATTER FOR THAT COURT .

Operative part

ON THOSE GROUNDS ,

THE COURT ( SECOND CHAMBER )

IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE BUNDESFINANZHOF BY ORDER DATED 1 APRIL 1980 , HEREBY RULES :

THE CONCEPT OF ' ' OTHER NON-ALCOHOLIC BEVERAGES ' ' IN HEADING 22.02 OF THE COMMON CUSTOMS TARIFF MUST BE INTERPRETED AS INCLUDING A PRODUCT COMPOSED OF BREWER ' S YEAST , WATER AND 3.9 % NATURAL CITRUS-FRUIT JUICE , PUT UP IN LIQUID FORM AND POTABLE , AND INTENDED TO BE TAKEN SEVERAL TIMES DAILY IN SMALL QUANTITIES FOR THE IMPROVEMENT OF HEALTH .