Opinion of Mr Advocate General Darmon delivered on 23 January 1990. - Openbaar Ministerie and the Minister for Finance v Vincent Houben. - Reference for a preliminary ruling: Hof van Beroep te Antwerpen - Belgium. - Free movement of goods - Goods in free circulation - Burden of proof. - Case C-83/89.



European Court reports 1990 Page I-01161



Opinion of the Advocate-General

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Mr President,

Members of the Court,

1 . On 4 July 1983, Mr Houben, a Belgian resident, was stopped and questioned by officials of the customs office at Eynatten in Belgium as he was returning in his vehicle from the Federal Republic of Germany . The customs officials found that he was importing a cassette player, an amplifier and two loudspeakers, all manufactured by Pioneer, which were installed in his vehicle, without declaring them or paying customs duty on them . On 17 December 1984, Mr Houben was prosecuted in the tribunal correctionnel ( Criminal Court ), Verviers, which referred the case, for procedural reasons, to the Correctionele Rechtbank ( Criminal Court ), Tongeren . He was acquitted by that court . The Belgian Minister for Finance and the Openbaar Ministerie ( Public Prosecutor' s Department ), however, lodged an appeal to the Hof van Beroep ( Court of Appeal ), Antwerp .

2 . It appears that Mr Houben is charged under Articles 220 to 222 of the Belgian Law of 18 July 1977 ( hereinafter referred to as "the Belgian Law ") laying down general provisions on customs and excise ( 1 ) with having failed to declare or to pay customs duty on the goods in question . Article 220 of the Belgian Law provides that all persons must make the necessary declarations to customs officials, under penalty of imprisonment . ( 2 ) Goods which are in free circulation must be declared, but no customs duty will be charged on them . ( 3 ) According to the written observations of the Belgian Government, in practice, a mere oral declaration is accepted where the value of the goods is modest . Furthermore, when goods are discovered inside Belgian territory, that is to say outside the customs zone, Article 224 of the Belgian Law places the burden of proof that the importation was fraudulent on the authorities . Where goods are discovered at the frontier or within the customs zone however, the burden of proof lies on the importer .

3 . It appears that a discussion arose before the Hof van Beroep, Antwerp, as to the concept of "goods in free circulation" and the rules of proof in that regard . It is relevant to note, in that connection, that, according to the written observations of the Belgian Government, the procedure before the Correctionele Rechtbank, Tongeren, revealed that Mr Houben had purchased the hi-fi equipment in question from a third party who had himself acquired it from a member of the armed forces serving in the Federal Republic of Germany . Article 65(2 ) of the Agreement of 3 August 1959 to supplement the Agreement between the parties to the North Atlantic Treaty regarding the status of their forces with respect to foreign forces stationed in the Federal Republic of Germany provides that goods destined for the military canteens of a foreign force stationed in that State are not to have any import duties levied on them . Nor may they be disposed of by way of either sale or gift . ( 4 )

4 . The Hof van Beroep, Antwerp, has therefore referred to the Court a series of questions seeking a ruling, essentially, on the concept of "goods in free circulation" and on the burden of proving that import formalities have been duly completed and customs duties paid .

5 . The answer to the first question gives rise to no difficulty . Under Article 10(1 ) of the EEC Treaty "products coming from a third country" are considered to be in free circulation in a Member State "if the import formalities have been complied with and any customs duties or charges having equivalent effect which are payable have been levied in that Member State, and if they have not benefited from a total or partial drawback of such duties or charges ". ( 5 ) That definition is unaffected by the fact that after customs duties have been paid and import formalities complied with the goods are exported to another Member State, as the Court stressed the fundamental unity of the systems applicable to goods produced in a Member State and those in free circulation in that State when it stated, in its judgment in Peureux v Services fiscaux de la Haute-Saône et du Territoire de Belfort, that

"the prohibition of (( restrictions )) in intra-Community trade has the same scope as regards products imported from another Member State after being in free circulation there as for those originating in the same Member State ". ( 6 )

6 . The second question referred to the Court appears to embrace two slightly different issues : one relating to proof that goods found in a Member State are in free circulation and one relating to such proof at the moment of importation into that State . That duality reflects, perhaps, the distinction drawn in Belgian law with regard to the burden of proof concerning fraudulent importation depending on whether or not the goods are found within the customs zone .

7 . Such a distinction does not appear to be relevant in Community law . The question of proving that goods are Community goods is currently governed by Council Regulation ( EEC ) No 222/77 of 13 December 1976 on Community transit . ( 7 ) It should be stated from the outset that Council Regulations ( EEC ) Nos 678/85 ( 8 ) and 679/85 ( 9 ) of 18 February 1985 are not relevant to the discussion . Those regulations were referred to by the Belgian Government in its written observations, ( 10 ) but they are applicable only from 1 January 1988 and can therefore have no bearing on the facts in the present dispute .

8 . Regulation No 222/77 applies to the movement of both Community and non-Community goods between two points situated in the Community . ( 11 ) It differentiates between two procedures for Community transit . 11 The first, referred to as the procedure for external Community transit, covers essentially goods which do not meet the requirements of Articles 9 and 10 of the Treaty, that is to say goods coming from non-member countries which are not in free circulation . The second, referred to as the procedure for internal Community transit, applies principally to goods originating or in free circulation in Member States; such goods are referred to as "Community goods ". ( 12 ) Article 1(4 ) of Regulation No 222/77 establishes a presumption that goods "properly imported into the territory of a Member State across an internal frontier" are to be deemed to be Community goods "unless an external Community transit document is produced in respect thereof ". ( 13 ) Article 39 of the regulation provides : "Any goods that are to be carried under the procedure for internal Community transit shall be covered by a ... declaration" on a form referred to as a T2 .

9 . As I pointed out in my Opinion in Case 117/88 Trend-Moden Textilhandels GmbH v Hauptzollamt Emmerich, other forms provided for in that regulation and in the implementing regulation, Commission Regulation ( EEC ) No 223/77, ( 14 ) may also be used as proof that goods are Community goods . In the Community transit procedure, goods are presumed to have a Community origin unless an external Community transport document is produced . It is that presumption, in fact, which justifies the possibility of subsequent production of internal Community transit documents . ( 15 )

10 . The situation on which the national court has to reach a decision, however, falls under the special provisions applying to goods carried by travellers or contained in their luggage, which are in Title VI of Regulation No 222/77 .

11 . In that title, Article 49 of the regulation provides : "The Community transit procedure shall not be compulsory for the carriage of goods accompanying travellers or contained in their luggage, if the goods concerned are not intended for commercial use ". Consequently, goods which are not carried under the Community transit procedure are covered by the provisions of the Treaty relating to the free movement of goods only "if they are declared as Community goods and there is no doubt as to the accuracy of that declaration" or, in other cases "if an internal Community transit document ... is produced ". ( 16 )

12 . The questions before the Court in this case turn, in my view, on the interpretation of that provision . Article 1(4 ) of Regulation No 222/77 establishes, as I have said, the presumption that goods are Community goods, subject to the provisions of Article 49(2 ). In order to establish that goods are of Community origin, therefore, a traveller must either produce an internal Community transit document or declare the goods as Community goods, subject to the existence of any doubt as to the accuracy of that declaration . In my opinion, the latter alternative is to be interpreted as meaning that a mere declaration by the traveller suffices to establish that goods are Community goods, unless the customs authorities can provide proof, based on previously obtained or immediately obvious evidence to the contrary, of the inaccuracy of that declaration . The actual nature of such evidence may vary greatly . I do not think the Court need define it . It might, however, indicate what factors may not be taken into consideration . In its written observations, the Belgian Government states that "it is clear from the facts of the case that doubts arose as to whether the goods involved could be considered to be Community goods, since Pioneer stereophonic equipment is imported from Japan ". ( 17 ) The Belgian Government thus considers that the mere fact that the brand name on the product implies that it was manufactured in a non-member country is a factor such as to cast doubt on the accuracy of the declaration .

13 . Such a view cannot be accepted . It presupposes the drawing of a distinction between goods manufactured in the Community and those in free circulation, which is in no way permitted by Article 9(2 ) of the Treaty and was indeed ruled out, as I have pointed out, by the Court' s judgment in Peureux . ( 18 ) Therefore, although customs authorities may reject a traveller' s declaration on the basis of certain previously obtained or immediately apparent evidence, that evidence may not consist merely of the fact that the brand name on the product implies that it was manufactured in a non-member country . I propose that the Court should answer the second question to that effect .

14 . I consider, therefore, that the Court should rule as follows :

"( 1 ) Article 10(1 ) of the EEC Treaty provides that products coming from a non-member country are to be considered to be in free circulation in a Member State if the import formalities have been complied with and any customs duties or charges having equivalent effect which are payable have been levied in that Member State, and if they have not benefited from a total or partial drawback of such duties or charges .

That definition is unaffected by the exportation of a product to another Member State .

( 2 ) Pursuant to Article 49 of Council Regulation ( EEC ) No 222/77 of 13 December 1976 on Community transit, as amended by Article 1 of Council Regulation ( EEC ) No 983/79 of 14 May 1979, the provisions of the EEC Treaty which relate to the free movement of goods are to apply to goods accompanying travellers or contained in their luggage, if the goods concerned are not intended for commercial use, provided that :

( i ) the importer declares them as Community goods and there is no doubt as to the accuracy of that declaration, or

( ii ) he produces an internal Community transit document .

Doubt may not be cast on the accuracy of that declaration on the basis merely of the fact that the brand name on the goods declared implies that they were manufactured in a non-member country ."

(*) Original language : French .

( 1 ) Moniteur belge, 21.9.1977 .

( 2 ) Written observations of the Belgian Government, p . 7 of the French translation .

( 3 ) Ibid ., p . 8 .

( 4 ) Article 11(8)(b ) of the Agreement between the parties to the North Atlantic Treaty regarding the status of their forces, signed at London on 19 June 1951 ( Moniteur belge, 15.3.1953, Annex 4; written observations of the Belgian Government, p . 14 of the French translation ).

( 5 ) Emphasis added .

( 6 ) Judgment of 13 March 1979 in Case 119/78 (( 1979 )) ECR 975, paragraph 26 .

( 7 ) OJ L 38, 9.2.1977, p . 1 .

( 8 ) Simplifying formalities in trade in goods within the Community ( OJ L 79, 21.3.1985, p . 1 ).

( 9 ) This regulation introduces a specimen declaration form to be used in trade in goods within the Community ( OJ L 79, 21.3.1985, p . 7 ).

( 10 ) P . 12 of the French translation ( see footnote 2 ).

( 11 ) Article 1(1 ).

( 12 ) Article 1(3)(a ).

( 13 ) Emphasis added .

( 14 ) Of 22 December 1976 on provisions for the implementation of the Community transit procedure and for certain simplifications of that procedure ( OJ L 38, 9.2.1977, p . 20 ).

( 15 ) Article 9 of Regulation No 222/77 and Article 71(3 ) of Regulation No 223/77 .

( 16 ) Article 49 of Regulation No 222/77 as amended by Council Regulation ( EEC ) No 983/79 of 14 May 1979 amending Regulation No 222/77 on Community transit ( OJ L 123, 19.5.1979, p . 1 ).

( 17 ) P . 14 of the French translation ( see footnote 2 ).

( 18 ) Case 119/78, cited above .