Judgment of the Court (Second Chamber) of 1 July 1982. - Hauptzollamt Hamburg-Jonas v Ludwig Wünsche & Co. - Reference for a preliminary ruling: Bundesfinanzhof - Germany. - Export refunds. - Case 145/81.



European Court reports 1982 Page 02493



Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

1 . COMMON CUSTOMS TARIFF - TARIFF HEADINGS - CLASSIFICATION OF GOODS - CRITERIA - OBJECTIVE PROPERTIES

2.AGRICULTURE - COMMON ORGANIZATION OF THE MARKET - CEREALS - EXPORT REFUNDS FOR CEREAL-BASED COMPOUND FEEDING-STUFFS - PROPORTION OF CEREAL PRODUCTS - DETERMINATION - CRITERIA - LACK OF EFFECT OF MANUFACTURING PROCESS

( COMMISSION REGULATIONS ( EEC ) NOS 661/72 AND 1121/72 )

3.AGRICULTURE - COMMON ORGANIZATION OF MARKETS - CEREALS - EXPORT REFUNDS FOR CEREAL-BASED COMPOUND FEEDING-STUFFS - PROPORTION OF CEREAL PRODUCTS - DETERMINATION - INGREDIENTS TO BE TAKEN INTO ACCOUNT - CONSTITUENTS

( COMMISSION REGULATIONS ( EEC ) NOS 661/72 AND 1121/72 )

Summary

1 . THE DECISIVE CRITERION FOR THE CLASSIFICATION OF GOODS FOR CUSTOMS PURPOSES MUST IN GENERAL BE SOUGHT IN THEIR OBJECTIVE CHARACTERISTICS AND PROPERTIES AS DEFINED BY THE WORDING OF THE RELEVANT HEADING OF THE COMMON CUSTOMS TARIFF AND THE NOTES RELATING TO THE RELEVANT SECTIONS OR CHAPTERS THEREOF .

2 . FOR THE PURPOSE OF DETERMINING THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN CEREAL-BASED COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 OF THE COMMISSION , ACCOUNT MUST BE TAKEN ONLY OF THE QUALITATIVE CRITERIA LAID DOWN BY THE COMMON CUSTOMS TARIFF , AND REFERENCE NEED NOT BE MADE TO THE MANUFACTURING PROCESS .

3 . THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 MUST BE DETERMINED BY TAKING ACCOUNT OF EACH OF THE INGREDIENTS OF THE COMPOUND FEEDING-STUFFS WHICH IN THEMSELVES CONFER ENTITLEMENT TO THE REFUNDS , SINCE EACH OF THOSE INGREDIENTS MAY ITSELF BE DERIVED FROM THE WORKING OR PROCESSING OF CEREALS BY A PROCESS INVOLVING A SEPARATE PRODUCTION TECHNIQUE .

Parties

IN CASE 145/81

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

HAUPTZOLLAMT ( PRINCIPAL CUSTOMS OFFICE ) HAMBURG-JONAS

AND

LUDWIG WUNSCHE & CO .,

Subject of the case

ON THE INTERPRETATION OF COMMISSION REGULATIONS ( EEC ) NOS 661/72 OF 29 MARCH 1972 AND 1121/72 OF 29 MAY 1972 DETERMINING THE EXPORT REFUNDS PAYABLE IN RESPECT OF CEREAL-BASED COMPOUND FEEDING-STUFFS ,

Grounds

1 BY ORDER OF 12 MAY 1981 , WHICH WAS RECEIVED AT THE COURT REGISTRY ON 9 JUNE 1981 , THE BUNDESFINANZHOF ( FEDERAL FINANCE COURT ) REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER ARTICLE 177 OF THE EEC TREATY FOUR QUESTIONS ON THE INTERPRETATION OF COMMISSION REGULATIONS ( EEC ) NOS 661/72 OF 29 MARCH 1972 AND 1121/72 OF 29 MAY 1972 DETERMINING THE EXPORT REFUNDS PAYABLE IN RESPECT OF CEREAL-BASED COMPOUND FEEDING-STUFFS ( JOURNAL OFFICIEL 1972 , L 79 , P . 35 , AND L 126 , P . 33 , RESPECTIVELY ).

2 BEFORE THE ACCESSION OF THE UNITED KINGDOM TO THE COMMUNITIES , LUDWIG WUNSCHE & CO . ( HEREINAFTER REFERRED TO AS ' ' WUNSCHE ' ' ) EXPORTED TO THAT COUNTRY TWO CONSIGNMENTS OF COMPOUND FEEDING-STUFFS WHICH , ACCORDING TO ITS DECLARATION , CONSISTED OF ' ' BARLEY FLOUR , OTHER ' ' , AND ' ' BARLEY HUSKS , MILLED ' ' , IN THE PROPORTIONS OF 66% AND 20% RESPECTIVELY , AND OTHER SUBSTANCES . THE FLOUR CONTAINED GROUND BARLEY AND ' ' DUST FROM THE HULLING OF BARLEY ' ' IN THE PROPORTIONS OF 22.7% AND 77.3% RESPECTIVELY . THE HAUPTZOLLAMT ( PRINCIPAL CUSTOMS OFFICE ) HAMBURG-JONAS LATER ESTABLISHED THAT THE ' ' BARLEY FLOUR , OTHER ' ' , WAS A MIXTURE AND THEREUPON DEMANDED REPAYMENT OF DM 89 175.33 OF AN AMOUNT OF DM 102 895.49 , WHICH HAD INITIALLY BEEN GRANTED TO WUNSCHE BY WAY OF REFUND . THE HAUPTZOLLAMT THUS REFUSED TO TAKE INTO ACCOUNT THE ' ' DUST FROM THE HULLING OF BARLEY ' ' ON THE GROUND THAT IT WAS A BY-PRODUCT IN THE MANUFACTURE OF HULLED BARLEY AND WAS NOT THEREFORE A CEREAL PRODUCT WITHIN THE MEANING OF THE REGULATIONS GOVERNING THE GRANT OF THE REFUNDS . THE HAUPTZOLLAMT REFUSED TO REGARD THE MIXTURE REFERRED TO AS ' ' BARLEY FLOUR , OTHER ' ' AS A HOMOGENEOUS PRODUCT .

3 THE HAUPTZOLLAMT LODGED AN APPEAL WITH THE BUNDESFINANZHOF AGAINST THE DECISION OF THE FINANZGERICHT ( FINANCE COURT ), WHICH HAD AGREED WITH WUNSCHE ' S REASONING TO THE EFFECT THAT ' ' DUST FROM THE HULLING OF BARLEY ' ' DERIVED FROM THE FIRST AND SECOND HULLING WAS A SINGLE HOMOGENEOUS PRODUCT AND WAS TO BE REGARDED AS A CEREAL PRODUCT IN THE SAME WAY AS GROUND BARLEY .

4 IN THESE CIRCUMSTANCES , THE BUNDESFINANZHOF REFERRED TO THE COURT THE FOLLOWING QUESTIONS FOR A PRELIMINARY RULING :

' ' 1 . IN DETERMINING THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF REGULATIONS ( EEC ) NOS 661/72 AND 1121/72 OF THE COMMISSION , IS ACCOUNT TO BE TAKEN ALSO OF PRODUCTS RESULTING FROM THE POLISHING OR HULLING , AND NOT THE GRINDING , OF CEREAL GRAINS?

2 . IS THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF THE AFOREMENTIONED REGULATIONS TO BE DETERMINED IN RELATION TO THE TOTAL INGREDIENTS IN THE COMPOUND FEEDING-STUFFS RESULTING FROM THE WORKING OR PROCESSING OF CEREALS?

3 . IF THE SECOND QUESTION IS ANSWERED IN THE NEGATIVE : CAN THE TERM ' CEREAL PRODUCTS ' WITHIN THE MEANING OF THE SAID REGULATIONS INCLUDE A PREPARATORY MIXTURE OF GROUND BARLEY AND SO-CALLED ' DUST FROM THE HULLING OF BARLEY ' ?

4 . IN THE FIRST QUESTION IS ANSWERED IN THE AFFIRMATIVE AND THE THIRD QUESTION IN THE NEGATIVE : MUST THE DUST ARISING FROM EACH POLISHING OR HULLING PROCESS IN THE PRODUCTION OF HULLED BARLEY , EVEN SPLIT OR CRUSHED ( GERSTENGRAUPEN ), BE TAKEN INTO ACCOUNT SEPARATELY IN DETERMINING THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF THE SAID REGULATIONS?

' '

5 WUNSCHE CONTENDS THAT THE METHOD BY WHICH THE CEREAL IS WORKED AND PROCESSED HAS NO BEARING ON THE DETERMINATION AND CLASSIFICATION OF THE PRODUCT , A VIEW WHICH IS MOREOVER SUPPORTED BY THE CONSISTENT DECISIONS OF THE COURT . IN ITS OPINION , IT IS THE CEREAL PRODUCTS COMPOSING THE GOODS WHICH ARE RELEVANT FOR THE PURPOSES OF CLASSIFICATION AND THE RIGHT TO A REFUND SHOULD BE ASSESSED IN THE LIGHT OF THAT COMPOSITION .

6 IN ITS OBSERVATIONS , THE COMMISSION CONTENDS THAT THE DECISIVE CRITERION SHOULD BE EXCLUSIVELY THE OBJECTIVE CHARACTERISTICS AND PROPERTIES OF THE PRODUCT AND NOT THE PROCESS BY WHICH IT IS PRODUCED OR MANUFACTURED AND THAT , CONSEQUENTLY , CEREAL PRODUCTS WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 SHOULD BE UNDERSTOOD AS INCLUDING PRODUCTS DERIVED NOT ONLY FROM THE GRINDING BUT ALSO FROM THE POLISHING OR HULLING OF CEREALS . AS FAR AS THE ANSWERS TO BE GIVEN TO QUESTIONS 2 TO 4 ARE CONCERNED , THE COMMISSION IS OF THE OPINION THAT THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS MUST BE DETERMINED ON THE BASIS OF EACH INDIVIDUAL INGREDIENT DERIVED FROM THE WORKING OR PROCESSING OF CEREALS BY A PROCESS INVOLVING A SEPARATE PRODUCTION TECHNIQUE .

THE FIRST QUESTION

7 THE FIRST QUESTION SEEKS IN SUBSTANCE TO ASCERTAIN WHETHER THE MANUFACTURING PROCESS IS RELEVANT FOR THE PURPOSE OF DETERMINING WHETHER A PRODUCT SHOULD BE REGARDED AS A ' ' CEREAL PRODUCT ' ' , WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 OF THE COMMISSION .

8 THE FOURTH RECITAL IN THE PREAMBLE TO EACH OF THE AFORESAID REGULATIONS STATES : ' ' . . . THE EXPORT REFUND FOR CEREAL-BASED COMPOUND FEEDING-STUFFS MUST BE DETERMINED BY TAKING INTO ACCOUNT ONLY PRODUCTS WHICH ARE NORMALLY USED IN THE MANUFACTURE OF COMPOUND FEEDING-STUFFS . . . ' ' . ARTICLE 7 ( 1 ) OF REGULATION ( EEC ) NO 968/68 OF THE COUNCIL ON THE SYSTEM TO BE APPLIED TO CEREAL-BASED COMPOUND FEEDING-STUFFS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1968 ( I ), P . 244 ) PROVIDES THAT ' ' THE EXPORT REFUND SHALL BE FIXED TAKING INTO ACCOUNT ONLY PRODUCTS USED IN THE MANUFACTURE OF COMPOUND FEEDING-STUFFS FOR WHICH AN EXPORT REFUND MAY BE FIXED ' ' .

9 IT IS CLEAR FROM FOOTNOTE 2 TO THE ANNEX TO REGULATIONS NOS 661/72 AND 1121/72 THAT THE PRODUCTS COVERED BY CHAPTER 10 AND BY HEADINGS 11.01 AND 11.02 OF THE COMMON CUSTOMS TARIFF ARE TO BE REGARDED AS CEREAL PRODUCTS .

10 ACCORDING TO EXPLANATORY NOTE 2 A TO CHAPTER 11 OF THE COMMON CUSTOMS TARIFF , ' ' PRODUCTS FROM THE MILLING OF CEREALS . . . FALL WITHIN THIS CHAPTER IF THEY HAVE , BY WEIGHT ON THE DRY PRODUCT : ( A ) A STARCH CONTENT ( DETERMINED BY THE MODIFIED EWERS POLARIMETRIC METHOD ) EXCEEDING ( 45% ); AND ( B ) AN ASH CONTENT ( AFTER DEDUCTION OF ANY ADDED MINERALS ) NOT EXCEEDING ( 3% ) ' ' . IT IS STATED IN THE SAME NOTE THAT PRODUCTS WHICH FAIL TO SATISFY THOSE CONDITIONS ARE TO BE CLASSIFIED IN HEADING 23.02 OF THE COMMON CUSTOMS TARIFF .

11 IT FOLLOWS THAT THE MANUFACTURING PROCESS MUST BE DISREGARDED AS FAR AS THE PRODUCTS IN QUESTION ARE CONCERNED . THEY MUST THEREFORE BE CLASSIFIED DIRECTLY IN THE SPECIFIC HEADING WHOSE CRITERIA FOR CLASSIFICATION THEY SATISFY .

12 IN THAT REGARD IT SHOULD BE EMPHASIZED THAT ACCORDING TO THE CONSISTENT CASE-LAW OF THE COURT , THE DECISIVE CRITERION FOR THE CLASSIFICATION OF GOODS FOR CUSTOMS PURPOSES MUST IN GENERAL BE SOUGHT IN THEIR OBJECTIVE CHARACTERISTICS AND PROPERTIES AS DEFINED BY THE WORDING OF THE RELEVANT HEADING OF THE COMMON CUSTOMS TARIFF AND THE NOTES RELATING TO THE RELEVANT SECTIONS OR CHAPTERS THEREOF .

13 ACCORDINGLY , THE ANSWER TO THE FIRST QUESTION MUST BE THAT FOR THE PURPOSE OF DETERMINING THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN CEREAL-BASED COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 OF THE COMMISSION , ACCOUNT MUST BE TAKEN ONLY OF THE QUALITATIVE CRITERIA LAID DOWN BY THE COMMON CUSTOMS TARIFF , AND REFERENCE NEED NOT BE MADE TO THE MANUFACTURING PROCESS .

THE REMAINING QUESTIONS

14 AS REGARDS THE REMAINING QUESTIONS , WHICH IT IS APPROPRIATE TO CONSIDER IN CONJUNCTION WITH ONE ANOTHER , THE BUNDESFINANZHOF WISHES IN SUBSTANCE TO ASCERTAIN WHETHER FOR THE PURPOSE OF FIXING REFUNDS , A COMPOUND FEEDING-STUFF MUST BE TAKEN INTO ACCOUNT AS A UNIT OR WHETHER EACH OF THE INGREDIENTS USED IN ITS COMPOSITION MUST BE TAKEN INTO CONSIDERATION AND , IN THE LATTER CASE , WHETHER PRODUCTS DERIVED FROM DIFFERENT PROCESSES MUST BE CONSIDERED SEPARATELY .

15 ARTICLE 7 ( 1 ) OF REGULATION NO 968/68 , CITED ABOVE , PROVIDES THAT ' ' THE EXPORT REFUND SHALL BE FIXED TAKING INTO ACCOUNT ONLY CERTAIN PRODUCTS USED IN THE MANUFACTURE OF COMPOUND FEEDING-STUFFS FOR WHICH AN EXPORT REFUND MAY BE FIXED ' ' .

16 IT FOLLOWS THAT FOR THE PURPOSE OF CALCULATING THE REFUNDS PAYABLE IN THE EVENT OF THE EXPORTATION OF COMPOUND FEEDING-STUFFS , IT IS NECESSARY TO TAKE ACCOUNT NOT OF ALL THE INGREDIENTS USED BUT , IN THE CASE OF HETEROGENEOUS COMPOSITIONS , OF THE INDIVIDUAL INGREDIENTS WHICH , CONSIDERED SEPARATELY , GIVE RISE TO A RIGHT TO A REFUND .

17 THE SECOND RECITAL IN THE PREAMBLE TO REGULATION ( EEC ) NO 1913/69 OF THE COMMISSION OF 29 SEPTEMBER 1969 ON THE GRANTING AND THE ADVANCE FIXING OF THE EXPORT REFUND ON CEREAL-BASED COMPOUND FEEDING-STUFFS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1969 ( II ), P . 403 ) ALSO STATES THAT ACCOUNT SHOULD BE TAKEN OF ' ' PRODUCTS ENTERING INTO COMPOUND FEEDING-STUFFS IN SUCH QUANTITY AND HAVING SUCH CHARACTERISTICS AS ARE TRULY REPRESENTATIVE . . . AND OTHER PRODUCTS WHICH ARE SECONDARY OR INSIGNIFICANT COMPONENTS OF THIS TYPE OF FEEDING-STUFFS SHOULD BE EXCLUDED ' ' .

18 SIMILARLY , ARTICLE 2 OF THAT REGULATION PROVIDES THAT ' ' THE EXPORTER SHALL DECLARE TO THE COMPETENT AGENCIES THE FULL COMPOSITION OF THE CEREAL-BASED COMPOUND FEEDING-STUFFS , GIVING THE PERCENTAGES OF EACH KIND OF PRODUCT ENTERING THEREIN BROKEN DOWN BY TARIFF HEADINGS ' ' . THAT OBSERVATION IMPLIES THAT THE EXPORTER ' S DECLARATION MUST SPECIFY ALL THE DIFFERENT INGREDIENTS OF THE PRODUCT IN QUESTION AND INDICATE THE EXACT PROPORTION OF THE PRODUCT WHICH EACH OF THOSE INGREDIENTS REPRESENTS AS WELL AS THE TARIFF HEADING TO WHICH IT BELONGS .

19 IN THE LIGHT OF ALL THE AFORESAID PROVISIONS , THE DUST ARISING FROM EACH POLISHING OR HULLING PROCESS , AS DESCRIBED IN THE FOURTH QUESTION OF THE COURT MAKING THE REFERENCE , MUST BE REGARDED AS A SEPARATE PRODUCT .

20 ACCORDINGLY , THE ANSWER TO THE REMAINING QUESTIONS MUST BE THAT THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF THE REGULATIONS MENTIONED IN THE REPLY TO THE FIRST QUESTION MUST BE DETERMINED BY TAKING ACCOUNT OF EACH OF THE INGREDIENTS OF THE COMPOUND FEEDING-STUFFS , SINCE EACH OF THOSE INGREDIENTS MAY ITSELF BE DERIVED FROM THE WORKING OR PROCESSING OF CEREALS BY A PROCESS INVOLVING A SEPARATE PRODUCTION TECHNIQUE .

Decision on costs

COSTS

21 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES , WHICH HAS SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE . AS THESE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN PROCEEDINGS ARE CONCERNED , IN THE NATURE OF 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 ( SECOND CHAMBER ),

IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE BUNDESFINANZHOF BY ORDER OF 12 MAY 1981 , HEREBY RULES :

1 . FOR THE PURPOSE OF DETERMINING THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN CEREAL-BASED COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF REGULATIONS NOS 661/72 AND 1121/72 OF THE COMMISSION , ACCOUNT MUST BE TAKEN ONLY OF THE QUALITATIVE CRITERIA LAID DOWN BY THE COMMON CUSTOMS TARIFF , AND REFERENCE NEED NOT BE MADE TO THE MANUFACTURING PROCESS .

2 . THE PROPORTION OF CEREAL PRODUCTS CONTAINED IN COMPOUND FEEDING-STUFFS WITHIN THE MEANING OF THE REGULATIONS MENTIONED IN THE REPLY TO THE FIRST QUESTION MUST BE DETERMINED BY TAKING ACCOUNT OF EACH OF THE INGREDIENTS OF THE COMPOUND FEEDING-STUFFS , SINCE EACH OF THOSE INGREDIENTS MAY ITSELF BE DERIVED FROM THE WORKING OR PROCESSING OF CEREALS BY A PROCESS INVOLVING A SEPARATE PRODUCTION TECHNIQUE .