2.

In the first question the French court inquires whether Regulation (EEC) No 803/68 of the Council of 27 June 1968, in particular Articles 1 to 10, and Regulation (EEC) No 1581/74 of the Commission of 24 June 1974 on the price reductions to be taken into account when determining value for customs purposes, allow the competent authorities of a Member State to attribute to goods imported from a non-member State a value for customs purposes less than the value declared by the importer or, for imports subsequent to the entry into force of Regulation (EEC) No 375/69 of the Commission of 27 February 1969, less than the value which results from the particulars relating to value for customs purposes declared by the importer. In order to clarify the significance of the distinction drawn by the court making the reference between the situation before and after the entry into force of Regulation No 375/69, I would remind the Court that that regulation, by way of an innovation in regard to certain national customs rules and practices limited to requiring the importer to declare the value for customs purposes of the goods, introduced the obligation of specifying certain items of fact relating to the value for customs purposes with a view to the application of Regulation No 803/68. However, even in the system laid down by the regulation just mentioned there is still a value declared by the importer on the basis of the information provided, as appears from the form of questionnaire annexed to the regulation. The answer to the question set forth above calls above all for an interpretation of Article 1 of Regulation No 803/68. That article provides that: “For the purposes of applying the Common Customs Tariff, the value for customs purposes of the goods imported shall be taken to be the normal price, that is to say, the price which they would fetch... on a sale in the open market between a buyer and a seller independent of each other.” The judgment of the Court of 10 December 1970 in Case 27/70 Edding ν Hauptzollamt Hamburg [1970] ECR 1035, in turn confirmed that “the price actually fetched by a specific item of goods sold” under conditions of free competition “is the best guide to the normal price forming the basis of the value for customs purposes” (paragraph 8 of the decision at p. 1044). It is clear that the possibility of there being a difference between the price agreed (and paid) and the “normal price” of the goods exists above all when the price has been agreed in a sale which was not effected under conditions of free competition. The Edding judgment above cited aptly stated (in paragraph 7 of the decision): “The principle objective of the concept of the normal price is to allow the customs authorities... to verify the price of goods if the conditions of the transactions to which they have given rise were influenced by factors affecting the conditions prevailing amongst business partners in a state of free competition.” The above-cited Article 1 (1) of Regulation No 803/68 seeks already, as has been seen, to define the concept of free competition by means of the requirement of the mutual independence of the seller and the purchaser. Article 2 (1) contains further detailed provisions laying down that before it is possible to speak of a sale in the open market between a buyer and seller independent of each other, it is necessary inter alia that payment of the price should constitute the sole consideration given by the buyer (that is, the only recompense given by him to the seller); that, furthermore, the price agreed upon must not be influenced by any commercial, financial or other relationship, other than that created by the sale itself, between the seller or any person associated in business with him on the one hand and the buyer or any person associated with him in business on the other hand, and finally that no part of the proceeds of any subsequent resale or other disposal or use of the goods will accrue, even indirectly, to the seller or any person associated in business with him. There is therefore no doubt that what is paramount in the determination of the value for customs purposes of imported goods is the “notional” normal price of the goods, not the price actually agreed upon and paid. Confirmation of this is to be found in other provisions of the regulation under consideration. It will suffice to cite Article 1 (2) (b) and (c) under which the normal price is to be determined on the assumption that the expenses incidental to the sale and delivery of the goods arc borne by the seller and the duties or taxes applicable in the customs territory of the Community are borne by the purchaser; Article 3, which lays down criteria for determining the normal price in the case of goods covered by a patent, trademark or other form of intellectual or industrial property right and, above all, Article 9 (1) (b) and (c) under which “the price paid or payable may be accepted as the value for customs purposes if... the price corresponds, at the time it is agreed upon, to prices on a sale in the open market between a buyer and a seller independent of each other, and that price is adjusted, if necessary, to take account of circumstances of the sale which differ from those on which the normal price is based”. In regard to this last provision, it is appropriate to note further that, when the conditions laid down are satisfied, the customs authorities have the power, but not a duty, to accept the price paid or to be paid as corresponding to the normal price and therefore to the value for customs purposes. These rules surely lead to the view that the determination of value for customs purposes is to be carried out objectively, without being dependent upon the importer's declaration. Such objective determination, which may of course imply that the price shown in the invoice may be corrected, is by no means confined to cases in which the price actually paid is lower than the normal price. No rule of Community law imposes such a restriction. Thus the conclusion is reached that Community law permits and even requires national customs authorities to proceed to amend the declared value whenever it deviates, not just downwards, but also upwards, from the normal price for the goods. Of course, by far the most common case of divergence between the delcared value and the normal price will involve the former amount's being less than the latter, since an importer has an obvious interest in having the customs authority apply the rate of duty to the lowest possible value. Accordingly, the rules on the determination of value for customs purposes have in view essentially such a case, being concerned above all to prevent evasion of the payment of duties which are owing. That is shown by inter alia, Article 9 (2) of Regulation No 803/68 in which are indicated the principal (not the only) adjustments to the prices paid or payable and in which are listed items going to make up value for customs purposes which have to be added to the invoiced price (expenses to be borne by the seller, reductions in price granted in favour of sole agents or sole concessionnaires, abnormal rebates). It may be added that the seventh recital in the preamble to the regulation recognizes the importance of avoiding and where appropriate eliminating any deflection of customs receipts. But that does not mean, in my opinion, that the customs authority is precluded from determining a normal price which is lower than the declared value. In truth, that proposition may be maintained only by praying in aid the two objectives of the Common Customs Tariff which consist in ensuring adequate protection for the Community economy and in procuring financial receipts for the Community. A declaration of value higher than the true value of the goods following upon which a corresponding charge to customs duty is made, would appear, in fact, to be advantageous for the Community both from the point of view of the protection of its economy and from the point of view of its financial receipts and it may therefore be doubted whether indeed, there is any Community interest in disputing that declaration by attributing a lower value to the goods. However, an assumed absence of any Community interest in so acting is insufficient ground for holding that the national authorities are prohibited from making any reduction in the value of imported products. For, in any event, when viewed on the level of objectives, it is surely not possible to ignore those which are specific to Regulation No 803/68 and consist principally in the introduction of uniform criteria for the determination of value for customs purposes. It appears to me that that point deserves to be underscored. It suffices to read the second, sixth and eighth recitals in the preamble to Regulation No 803/68 to appreciate the emphasis with which the legislature has expressed the need for “customs legislation which will ensure uniform application of the Common Customs Tariff”, the same level of protection throughout the Community and equal treatment of importers as regards the collection of customs duties. In the case-law of the Court, the judgment of 12 July 1973 in Case 8/73 Hauptzollamt Bremerhaven ν Massey-Ferguson GmbH [1973] ECR 897 has already stated that: “The functioning of a customs union requires of necessity the uniform determination of the valuation for customs purposes of goods imported from third countries” (paragraph 3 of the decision). The judgment of 23 November 1977 in Case 38/66 Enka BV ν Inspecteur der Invoerrechten en Accijnzen, Arnhem [1977] ECR 2203 confirmed the same concept, citing the sixth recital in the preamble to Regulation No 803/68, and conveniently linked the objective of the uniform determination of value for customs purposes with the criterion of the “normal prices” of the imported goods (paragraph 13 and 14 of the decision). There are therefore good grounds for holding that the paramount Community interest, in regard to the determination of value for customs purposes, is that of uniformity in the criteria. That uniformity has been obtained by imposing on all Member States the criterion of the normal price. That fully justifies, in my view, the possibility of reducing the declared value in order to bring it into line with the normal market price. Other considerations, of a different nature, reinforce further the suggested solution. On the level of the Community's interests, it appears proper to take account also of its interest in avoiding an over-valuation of imported products which is liable to have repercussions on the level of prices within the Community. On the other hand, the placing of a heavier burden of duty on goods erroneously overvalued by the importer would, in the end, put other more prudent importers in an advantageous position in clear opposition to the principle of fair competition. Finally, on the level of equity, an importer who may have made a bad bargain by paying too high a price ought to be able to have the customs duty calculated on the market price of the goods. The court making the reference also refers in its first question to Regulation No 1581/74 of the Commission of 24 June 1974. However, it does not appear to me that that regulation has any bearing on the answer to be given to that question. In Regulation No 1581/74 the Commission laid down the circumstances under which price reductions granted by a seller to a buyer might be taken into account in determining value for customs purposes. But what is here being debated is, rather, the case in which the customs authority proceeds to revise the invoice price because of the discrepancy found between it and the normal market price of the product. The regulation cited cannot therefore contribute to the clarification of the problem with which we are concerned, except to the extent to which it confirms the criterion of the normal price (which represents its starting point); but that is nothing at all new, since it is a regulation implementing Council Regulation No 803/68 which was considered above. So far as Regulation No 375/69 of the Commission of 27 February 1969 (which is also mentioned in the first question submitted for a preliminary ruling) is concerned it aims to ensure equality of treatment for importers in completing the declaration of factors relating to value for customs purposes, and it does so by indicating in detail (in its annex) the information which they are bound to provide. For the present, I should like to restrict myself to drawing attention to one of the rules in this regulation which confirms the thesis which I considered might be drawn from the basic regulation. The provision is Article 1 (2) of the said Regulation No 375/69; it provides that the customs authorities may request from the importer more detailed information than that provided in the form of questionnaire annexed to the regulation, particularly where importation is effected pursuant to a transaction between a buyer and a seller who are not independent of each other. The interesting feature is that not even in this rule is the case in which the customs authority is confronted by an invoice price which is lower than the normal price distinguished from the case in which the invoice price appears higher than the normal price. That leads one to the view that, with the assistance of the further information requested, the customs authorities may rectify the value declared by the importer on the basis of his acquisition price in the sense either of increasing the sum or of reducing it.