Opinion of Mr Advocate General La Pergola delivered on 6 March 1997. - Bioforce GmbH v Oberfinanzdirektion München. - Reference for a preliminary ruling: Finanzgericht München - Germany. - Common customs tariff - Heading 3004 - Echinacea - Medicament. - Case C-405/95.



European Court reports 1997 Page I-02581



Opinion of the Advocate-General

I - Introduction

1 In these proceedings the Court is called upon to define what constitutes a `medicament'. The question is whether the provisions of the Common Customs Tariff (`CCT') concerning medicaments can be applied to preparations made of Echinacea purpurea extract.

II - Facts

2 On 31 May 1994 the Oberfinanzdirektion München (Principal Revenue Office, Munich, Germany) issued the applicant Bioforce GmbH with a binding notice of customs tariff classification in which it stated that the product in question, consisting of Echinacea extract-based drops, must be classified under subheading 2208 90 69 of the Combined Nomenclature, `other spirituous beverages'. The applicant contested that notice in an action before the Finanzgericht München (Financial Court, Munich).

3 The substance whose tariff classification is in issue consists of a mixture of vegetable extracts (95% Echinacea purpurea e herba and 5% Echinacea purpurea e radice) and distilled alcohol with an alcoholic strength of 65% by volume. The preparation is sold retail in the form of drops or under the name `Echinaforce' in packages indicating their composition together with their use and recommended dosage.

The national court states that the therapeutic information notices supplied by the company manufacturing the product describe the drops in question as being `Traditionally used as a prophylactic: taken preventively, Echinacea Drops provide protection at times of increased risk of infection from colds and enhance resistance to feverish colds'. The recommended dose as a prophylactic is 20 drops taken in a little water three times a day. Echinaforce packages also recommend a dose of 20 drops three times a day for preventive purposes and, in cases of severe colds, 20 to 30 drops five times a day. The instructions for use go on to list contraindications.

4 The national court states further that, according to the notice issued by the Oberfinanzdirektion and contested by the applicant, the active substances in Echinacea have not as yet found universal recognition as medicaments. Accordingly, they could not be classified under heading 3004 of the Nomenclature. The applicant, for its part, maintains that Echinacea has been accepted as a medicinal product by the competent German authorities and by the health authorities of other European countries. Moreover, it claims that the prophylactic effects of taking Echinacea are sufficient to warrant its inclusion among the products coming under heading 3004. Moreover, the applicant points out, Echinacea is normally sold as a medicinal product in German pharmacies.

5 In order to settle the dispute it is necessary to interpret the provisions of Community law contained in the CCT, and the national court has decided that it must refer the following questions to the Court of Justice for a preliminary ruling:

`(1) Is the Common Customs Tariff - Combined Nomenclature 1994 - to be interpreted as meaning that products such as Echinacea Drops (extract of echinacea purpurea e herba and e radice in 56.1% alcohol by weight, for protection against colds and influenza and for strengthening resistance to colds) are to be classified under heading 3004 - Medicaments consisting of unmixed products for therapeutic or prophylactic uses, put up ... for retail sale?

(2) If not, is the Common Customs Tariff to be interpreted as meaning that products such as those referred to in Question 1 are to be classified as "other" spirituous beverages under subheading 2208 90 69?'

III - Relevant provisions

6 Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff (1) introduced a combined nomenclature. Pursuant to Article 12 thereof, for the year 1994 the Commission adopted Regulation (EEC) No 2551/93 of 10 August 1993 (2) which sets out all the rates of duty under the CCT.

7 Chapter 22 of the CCT covers `Beverages, spirits and vinegar'.

Heading 2208 concerns the following products:

`Undenatured ethyl alcohol of an alcoholic strength by volume of less than 80% vol: spirits, liqueurs and other spirituous beverages; (...)'.

Subheading 2208 90 69 covers `other spirituous beverages'.

Note 1(e) of the introductory notes to Chapter 22 of the CCT expressly states that that chapter does not cover `medicaments of heading No 3003 or 3004'.

8 Chapter 30 of the Common Customs Tariff concerns `Pharmaceutical products'.

Heading 3004 covers:

`Medicaments (...) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or packings for retail sale'.

It follows from Note 1(a) of the introductory notes to Chapter 30 of the CCT that that chapter does not cover `foods or beverages such as dietetic, diabetic or fortified foods, food supplements, tonic beverages and mineral waters'.

IV - Analysis of the dispute

9 In essence, the dispute which the Court is asked to resolve concerns the definition of `medicament' to be used for the purpose of deciding whether or not the products in question should be included in tariff heading 3004. The Court has already been called upon to give a ruling on a similar question in which the issue was the customs classification of hawthorn drops. (3) It should also be borne in mind that the term medicament is used in Community legislation (4) and has been the subject of several judgments delivered by this Court, of which Case C-219/91 Ter Voort (5) is of particular relevance to the present case. Those judgments define the framework within which the problem now submitted for the Court's consideration must be considered and resolved.

10 Let me now turn to the first question, which is whether the product concerned is a medicament. What meaning should we give to the concept of `Medicaments (...) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or packings for retail sale' used in heading 3004 of the Common Customs Tariff? In its observations the Commission states that in the circumstances of this case classification as a medicament is precluded by the explanatory notes to Chapter 30 of the Common Customs Tariff. The rule is that `The description of a product as a medicament in Community legislation (other than that relating specifically to classification in the combined nomenclature) or in the national legislation of the Member States, or in any pharmacopoeia, is not the deciding factor in so far as its classification in (...) [C]hapter [30] is concerned'. However, the Commission interprets that rule in one way only: it considers that the fact that a product is classified as a medicament for other purposes does not mean or necessarily imply that it is covered by the heading concerning medicaments in the Common Customs Tariff.

11 I, however, am not persuaded by that reading of the provision. Were it to be adopted, the result would be the introduction of further classification criteria other than those required by the facts and by the Community legislation, in order to be able to determine whether or not a particular product falls into the category of medicaments for the purposes of the Common Customs Tariff. I take the view that the first mentioned rule of interpretation means something else, much simpler and more logical. The provision merely sets out a criterion for interpretation which the Court has, moreover, had occasion to define in the `hawthorn drops' judgment. The Court specifically ruled that it is necessary to consider the actual nature of the product, that is to say that the characteristics and properties of the product must be objectively appraised. It should be added that, in the light of Ter Voort, it is also necessary to establish how the product is regarded by averagely well-informed consumers in order to decide whether or not it is covered by the tariff heading in question. The fact that the official pharmacopoeia of a Member State counts a particular product as a medicament may therefore constitute one criterion of assessment, but is not the only valid evidence for that purpose. Similarly, the fact that the product is not among those listed in the pharmacopoeia does not, to my mind, prove conclusively that it is not a genuine medicament.

12 Furthermore, Community legislation very clearly draws the distinction which I have pointed out. According to Article 1(2) of Directive 65/65/EEC, cited above, a medicinal product is `any substance or combination of substances presented for treating or preventing disease in human beings or animals. Any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in human beings or animals is likewise to be considered a medicinal product'.

Thus Community legislation provides a definition of medicinal product `by virtue of presentation'. It should be noted that Advocate General Tesauro, in his Opinion in Ter Voort, cited above, stated that `the definition of a medicinal product "by virtue of presentation" also covers products indicated or recommended as having therapeutic or prophylactic properties by oral representation and, more generally, all products which appear to the averagely well-informed consumer in the light of their presentation to be medicinal products'. (6) Mr Tesauro went on, in the same Opinion, to assert that `even a product which is generally regarded as a foodstuff and, in the present state of scientific knowledge, has no pharmacological properties whatsoever, falls within the Community definition of a medicinal product by virtue of its presentation within the meaning of the first paragraph of Article 1(2) of Directive 65/65 where it is presented by the seller or a third party linked to the seller as having therapeutic or prophylactic properties'. The Court fully endorsed the Advocate General's point of view, declaring that: `even if it comes within the scope of other, less stringent Community rules, such as the rules on cosmetic products, a product must be held to be a medicinal product and be made subject to the corresponding rules if it is presented as possessing therapeutic or prophylactic properties or if it is intended to be administered with a view to restoring, correcting or modifying physiological functions. Moreover, the fact that a product is in the nature of a foodstuff cannot prevent it from being categorized as a "medicinal product" within the meaning of the provisions of the first subparagraph of Article 1(2) of Directive 65/65 in so far as the indication or recommendation of its therapeutic or prophylactic properties is in itself of such a kind as to cause it to be regarded as a product presenting the characteristic properties of a therapeutic substance, that is to say, a medicinal product'. (7)

13 In the light of the foregoing, I am inclined to consider that there are various factors which come into play in determining whether or not a product is a medicament for the purposes of heading 3004: in addition to the official classification in the pharmacopoeia, the product's particular properties as indicated on the packaging, the manner in which it is presented for sale, its recommended use, the method of administration, the place in which it is marketed, and also the general perception of the substance as being a medicinal product, constitute useful criteria and relevant evidence for the purpose of determining its classification in one heading or another of the Common Customs Tariff.

In any event, it would be impossible to consider a different interpretation which would imply that the Community legislature intended to lay down contradictory rules: such a conclusion could only create confusion for those called upon to apply the law and lead to a situation of legal uncertainty as to the true definition of a medicament. That definition cannot vary according to whether it is a question of applying the rules governing the pharmacological sector or of placing the product in the appropriate heading of the Common Customs Tariff.

14 Furthermore, the Commission's observation that the product in question is not used for the treatment or prevention of a specific illness in a particular part or area of the body, but rather performs a generic prophylactic function is not pertinent. If the condition which the Commission considers necessary were really fundamental and necessary in order for a preparation to be classed as a medicament, a whole series of substances which are undeniably medicaments and which have a definite broad-spectrum prophylactic and/or preventive function, such as antibiotics or immunizing substances, or which, like aspirin, have various functions, could not be classified in heading 3004.

15 In the case with which we are concerned, without prejudice to the more detailed assessment of the facts which naturally falls to the national court, it is certain, for example, that the presentation of the product and its recommended administration make it impossible to contemplate its use for other than medicinal purposes. It does not display any particular organoleptic properties making it suitable for different usage, thus transforming it into a drink for consumption in moments of relaxation or at other times. To my mind, its unambiguous usage, together with the other criteria already considered, constitutes decisive evidence for the purposes of the possible classification of the product in question as a medicament under the Common Customs Tariff, irrespective of its actual pharmacological nature and the proven presence of active principles with an efficacious therapeutic or prophylactic action. This argument inter alia was upheld by the Court in its judgment in Colin and Dupré. (8)

16 The other observations submitted by the Commission in order to show that heading 3004 of Common Customs Tariff cannot cover products such as those involved in this case are not, in my view, well founded. The distinction which the Commission seeks to draw between medicaments and tonic beverages under heading 2208 does not seem to me to be relevant: the action on the human body of the food supplements to which the Commission refers cannot be regarded as the transformation or alteration of a physiological function. On the other hand, Echinacea Drops cause a real increase in phagocytosis: the Commission, nevertheless, disputes the view that the change brought about by taking the product concerned is sufficient to enable it to be classified as a medicament. The Commission, however, confuses supplementing substances in which the body is deficient (vitamins and minerals) with the actual alteration of a normal physiological process. Nor is it relevant in this respect that, as the Commission is anxious to point out, there are substances which, while capable of effecting a change in the body, are none the less classified as food supplements: the difference in those cases is that those substances do not have the primarily therapeutic or prophylactic purpose of fighting or preventing disease. The cases cited by the Commission concern substances which do not in themselves contain active ingredients intended to cure or prevent disease (for example, food preparations for use against obesity) and which are not as a rule designed to have prophylactic or therapeutic effects on the body, but to act as adjuvants to other substances.

17 In case the Court should decide that the product in question does not possess the character of a medicament, I shall set out below - purely in the alternative - some further considerations as to how it could be given a different classification. In the `hawthorn drops' judgment, the Court had occasion to state that, as regards the product then under consideration, `(...) as also emerges from the documents before the Court, the alcohol contained in the product, however high the percentage may be, does not change its nature. On the contrary, its function is to act as an adjuvant, a preservative and a vehicle for the active principles of the said product'. Similar observations may hold true for the product at issue in this case. That finding of the Court means that in this case too it may be stated that the presence of alcohol in the mixture concerned does not give rise to the conclusion that the product is an alcoholic beverage coming within heading 2208 90 69, as on the contrary the defendant would have it. In the light of the foregoing considerations, the only classification left is under heading 1302 (Vegetable saps and extracts).

V - Conclusion

18 In the light of the considerations set out above, I propose that the Court reply as follows to the question referred by the Finanzgericht München:

Heading 3004 of the customs tariff nomenclature contained in Commission Regulation (EEC) No 2551/93 of 10 August 1993 must be interpreted as including a product used exclusively for therapeutic or prophylactic purposes and composed of a vegetable extract and a solution of alcohol where that preparation, regardless of its classification in the pharmacopoeia, is presented as a medicament and is normally regarded as acting as such on the basis of the following features: the product's characteristic properties, method of administration, packaging and presentation, principal place of sale, recommended use, dosage and general recognition of its medicinal characteristics by averagely well-informed consumers.

(1) - OJ 1987 L 256, p. 1.

(2) - OJ 1993 L 241, p. 1.

(3) - Case C-177/91 Bioforce v Oberfinanzdirektion München [1993] ECR I-45.

(4) - Council Directive 65/65/EEC of 26 January 1965 on the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products (OJ, English Special Edition 1965-66, p. 20).

(5) - [1992] ECR I-5485.

(6) - Opinion of Mr Tesauro in Case C-219/91 Ter Voort ECR I-5496, at p. 5498.

(7) - Ter Voort, cited above, paragraphs 19 and 20.

(8) - Joined Cases C-106/94 and C-139/94 Colin and Dupré [1995] ECR I-4759, paragraph 28.