Judgment of the Court (Fourth Chamber) of 31 March 1992. - Hamlin Electronics GmbH v Hauptzollamt Darmstadt. - Reference for a preliminary ruling: Hessisches Finanzgericht - Germany. - Common Customs Tariff - Temporary suspension of autonomous duty - Reed switches. - Case C-338/90.



European Court reports 1992 Page I-02333



Summary

Parties

Grounds

Decision on costs

Operative part



Keywords

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Common Customs tariff - Amendment or suspension of import duty - Description of the products concerned - Interpretation - Criteria - "Reed switches containing not more than a small quantity of mercury" - Reed switches containing no mercury - Inclusion

(Council Regulations No 3696/88, Art. 1, and No 1656/89, Art. 1)

Summary

The ambiguous wording used in the Annex to Regulations No 3696/88 and No 1656/89, both temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronics and related sectors), namely (CN Code ex 8536 5000) "Reed switches in the form of a glass capsule containing not more than three electrical contacts on metal arms and a small quantity of mercury", must, in view of the fact that duty was suspended because of inadequate production within the Community of switches containing little or no mercury and because of the need for such products to be available to user industries in the Community, whereas Community production of switches containing a large quantity of mercury is adequate, be interpreted as meaning that switches containing no mercury qualify for the suspension of customs duty.

Parties

In Case C-338/90,

REFERENCE to the Court under Article 177 of the EEC Treaty from the Hessisches Finanzgericht (Finance Court, Hesse) for a preliminary ruling in the proceedings pending before that court between

Hamlin Electronics GmbH

and

Hauptzollamt Darmstadt,

on the interpretation of Council Regulations (EEC) No 3696/88 of 18 November 1988 (Official Journal 1988 L 329, p. 1) and No 1656/89 of 29 May 1989 (Official Journal 1989 L 167, p. 1) temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronic and related sectors),

THE COURT (Fourth Chamber),

composed of: P.J.G. Kapteyn, President of the Chamber, C.N. Kakouris and M. Díez de Velasco, Judges,

Advocate General: M. Darmon,

Registrar: J.A. Pompe, Deputy Registrar,

after considering the written observations submitted on behalf of:

- Hamlin Electronics GmbH, by Dirk Krueger, of the Frankfurt Bar,

- the Commission of the European Communities, by its Legal Adviser, René Barents, acting as Agent;

having regard to the Report for the Hearing,

after hearing the oral observations of the Commission, represented by Roberto Hayder, acting as Agent, at the hearing on 22 November 1991,

after hearing the Opinion of the Advocate General at the sitting on 17 January 1992,

gives the following

Judgment

Grounds

1 By order of 18 October 1990, which was received at the Court Registry on 7 November 1990, the Hessisches Finanzgericht (Finance Court, Hesse) referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question on the interpretation of Council Regulations (EEC) No 3696/88 of 18 November 1988 and No 1656/89 of 29 May 1989 temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronics and related sectors).

2 That question arose in proceedings between Hamlin Electronics and the Hauptzollamt (Principal Customs Office) Darmstadt concerning the classification for tariff purposes of a product in subheading 8536 5000 9930, which is set out in the Annex to the abovementioned regulations, entitled "reed switches in the form of a glass capsule containing not more than three electrical contacts on metal arms and a small quantity of mercury".

3 Between June and December 1989 Hamlin Electronics imported electric reed switches containing no mercury from the United States. Pursuant to the abovementioned regulations, the Hauptzollamt Darmstadt at first granted suspension of customs duty in respect of those switches. Subsequently, by a post-clearance recovery notice, the Hauptzollamt demanded payment of customs duty amounting to DM 152 702 on the ground that switches containing no mercury did not fall under the subheading referred to above but under subheading 8536 5000 9990 in respect of which no suspension of customs duty was envisaged.

4 Hamlin Electronics thereupon sought the annulment of that notice in proceedings before the Hessisches Finanzgericht. In support of its application Hamlin Electronics claimed that electrical switches containing no mercury also come within the scope of subheading 8536 5000 9930.

5 The Hessisches Finanzgericht considered that the interpretation of that provision raised the question whether the presence of mercury in the switches concerned was a determining factor for the suspension of customs duty. It therefore stayed the proceedings and requested the Court to give a preliminary ruling on the following question:

"Is the wording in Table II and the Annex respectively to Council Regulations (EEC) No 3696/88 of 18 November 1988 and No 1656/89 of 29 May 1989 temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronics and related sectors) (Official Journal 1988 L 329, p. 1, at p. 8, and Official Journal 1989 L 167, p. 1, at p. 5) ex 8536 5000 'Reed switches in the form of a glass capsule containing not more than three electrical contacts on metal arms and a small quantity of mercury' to be interpreted as meaning that the reed switches must contain a small quantity of mercury in order to qualify for the suspension of duty or does the said wording mean that reed switches without mercury or with no more than a small quantity of mercury qualify for the suspension of duty?"

6 Reference is made to the Report for the Hearing for a fuller account of the facts of the case, 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.

7 In its question the national court is essentially seeking to ascertain whether the provision at issue must be interpreted as meaning that the switches to which it refers must contain a small quantity of mercury in order to qualify for the temporary suspension of customs duty.

8 In order to answer that question, it should be borne in mind first of all that, as the Court has consistently held (see, most recently, the judgment in Case C-384/89 Tomatis and Fulchiron [1991] ECR I-127), regard being had to the requirements of legal certainty, the decisive criterion for the tariff classification of goods must be sought generally in their objective characteristics and qualities, as defined in the headings of the Common Customs Tariff.

9 Only in that way can the unequivocal application of the provision at issue be ensured for both the trader concerned and the authorities called upon to interpret it. That requirement of legal certainty takes on particular importance where, as in this case, the rules in question entail financial consequences for traders.

10 As regards the wording of the provision at issue, the question arises whether the expression "containing not more than" must be regarded as attaching to both the phrases which follow it. If so, a small quantity of mercury constitutes the upper limit beyond which suspension of customs duty no longer applies; the description would therefore cover switches containing no mercury. If, on the other hand, that expression relates only to the first phrase following it, the presence of a small quantity of mercury is necessary for the suspension of customs duty to apply, with the result that switches containing no mercury would not be covered by the description.

11 In that regard, it should be noted that grammatical analysis of the various language versions does not provide unequivocal evidence one way or another, even if the use by the Council of the term "small" quantity could be taken to express its intention to limit as far as possible the quantity of mercury present in those switches.

12 It must be borne in mind that where a provision is ambiguous it must be interpreted according to the general scheme and purpose of the rules of which it forms part.

13 In that regard, it should be noted that customs duty was suspended because of inadequate production within the Community of switches containing little or no mercury and because of the need for such products to be available to user industries in the Community. On the other hand, production in the Community of switches containing a large quantity of mercury is adequate.

14 As regards switches containing no mercury, it is apparent from the proceedings before the Court that they constitute products which are more advanced from a technological point of view and the disposal of which, moreover, poses a less serious threat to the environment.

15 Having regard to those considerations, it must be held that the provision at issue is to be interpreted as meaning that the switches to which it refers may contain not more than a small quantity of mercury. Logically, that includes switches containing no mercury.

16 The answer to the question submitted must therefore be that the wording used in Table II of Council Regulation (EEC) No 3696/88 of 18 November 1988 and in the Annex to Council Regulation (EEC) No 1656/89 of 29 May 1989, both temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronic and related sectors), namely (CN Code ex 8536 5000) "Reed switches in the form of a glass capsule containing not more than three electrical contacts on metal arms and a small quantity of mercury", is to be interpreted as meaning that switches containing no mercury qualify for the suspension of customs duty.

Decision on costs

Costs

17 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 question referred to it by the Hessisches Finanzgericht by order of 18 October 1990, hereby rules:

The wording used in Table II of Council Regulation (EEC) No 3696/88 of 18 November 1988 and in the Annex to Council Regulation (EEC) No 1656/89 of 29 May 1989, both temporarily suspending the autonomous Common Customs Tariff duty on certain industrial products (in the microelectronics and related sectors), namely (CN Code ex 8536 5000) "Reed switches in the form of a glass capsule containing not more than three electrical contacts on metal arms and a small quantity of mercury", is to be interpreted as meaning that switches containing no mercury qualify for the suspension of customs duty.