3.

In its second question, which is in fact a group of three questions, the Finanzgericht asks the Court to what factual criteria the composition of goods must conform in order that they may be classified either under heading 11.01, heading 11.02 or heading 23.07 given that, having regard to the problems brought before this Court, the goods in question can only be those processed maize products and processed sorghum or milo products. The particular problem (always bearing in mind the dispute as it was presented to the national court) is how to distinguish those products and the residues referred to in headings 23.03 and 23.04 of the tariff. This question has been correctly referred to the Court for a ruling even though both the last-named tariff headings did not come under an organization of the market during the relevant period. In this connexion the Court has already ruled on this point in a number of judgments to which it will thus be sufficient to refer. (a) First of all we must consider here a general problem of interpretation, namely, whether it is permissible to take into consideration the requirements of the organizations of the market in solving questions involving the distinction between headings in the Common Customs Tariff. The Court had already stated in various judgments that such a method is justifiable. Nevertheless the plaintiff in the main action considers that the Court may not have recourse to such a procedure and it strongly urges the Court to refrain from so doing in future. In support of its argument it states that the agricultural regulations refer simply to the Common Customs Tariff which, in its turn, is based on the Brussels Nomenclature. It deduces from this that the economic circles concerned were entitled to believe that the tariff headings to which reference was thus made would not receive an interpretation differing from that generally accepted by the States which were signatories to the Brussels Convention. It claims in any case that there can be no question of bringing within the field of application of the organizations of the agricultural markets by interpretation products which the legislature did not clearly intend should be encompassed by them. What view is to be taken of this line of argument and of the urgent appeal which the importer addresses to the Court, requesting it to refrain from adopting the method of interpretation which it has used until now? It is true that the Common Customs Tariff to which the agricultural regulations refer is based on the nomenclature established by the Brussels Convention of 15 December 1950 on the Nomenclature for the Classification of Goods in the Customs Tariffs. It is also certain that there can be no question of modifying by interpretation the scope of the principal headings of this nomenclature within the framework of the Community. However I do not consider that the method approved by the case-law of the Court in any way tends to produce such a result. It appears that the judgments in which the Court has mentioned the principle of interpretation of which the plaintiff complains or those in which it applied that principle were based on the finding that, since the description of goods appearing in the Common Customs Tariff are of necessity worded in general terms, they leave a certain margin for interpretation. Furthermore it must also be observed that there is not complete unanimity in interpreting the nomenclature of the customs tariff as there are divergences both in the practices and in the economic legislation of the States which were signatories to the Brussels Convention and it is clear that they play a part in the application of this nomenclature. Many problems arise especially with regard to new types of product which are constantly appearing precisely in the processed cereals sector, perhaps indeed because of the provisions on the organization of the market laid down by the Community. When, bearing this situation in mind, the correct classification of the goods requires the legal context of the tariff heading, which certainly includes the interests of the organization of the market, to be taken into consideration, this merely amounts in short to advocating the application of an entirely normal method of interpretation. Where problems of demarcation must be resolved it is really only a question of going, if necessary, to the limit permitted by the objective wording of a tariff heading, bearing in mind the existence of a margin of interpretation and certain requirements of the Community. It cannot be claimed that this method fails to observe the principle of the legitimate expectation of interested parties, since, in the first place, all interested parties are aware of the context of the tariff headings in question (in other words, of the political objectives involved); secondly, with regard to completely new products, it is impossible to speak of well-defined international practice on classification which has been adopted for many years and which it is important to take into consideration. Finally, it is also impossible to state that in adopting this method the Court merely endeavours to discover the probable intentions of the legislature. Contrary to the plaintiff's view this does not imply, in the context of disputes regarding tariff classification that, in order to produce a specific result and where it appears sufficiently certain that this corresponds to the intention of the legislature, there is a general provision according to which the application of the heading in question must extend to similar goods. Consequently, I consider that ultimately no objection may be made to the application of the method of interpretation of which the plaintiff in the main action has criticized, and I thus suggest that the Court should, if necessary, again have recourse to it in the present case. (b) If we now consider heading 11.01 we may acknowledge, adopting the findings which have already been made by the Court in other cases, that the context in which it is situated indicates that this heading refers to products arising from the specific process of cereal milling. Furthermore, it is beyond doubt that the classification of a product under this heading cannot be affected by the fact that it has undergone certain processing operations where the processed product thereafter contains the essential constituents of the basic product in proportions corresponding to the normal variations in the contents in those constituents as displayed by that basic product in its natural state. This indicates in particular that the tariff classification of the product is unaffected by the removal of very small quantities of certain constituents (see the judgment of 14 July 1971 in Case 12/71, Henck v Hauptzollamt Emmerich—kibbled maize grains, [1971] ECR 743). However, in view of the wide variations which the proportions of the constituents of basic products apparently display I consider it unnecessary to quote figures. It is for the national court to reach the necessary findings in this respect, having recourse to an expert, if necessary. If large quantities of its essential constituents are removed from a product, one of the questions which arises is whether the remainder of the product is only what the tariff calls residues or waste. In this respect too, with regard to the extraction of starch and the distinction to be made in relation to heading 23.03 reference may be made to some important rulings contained in the case-law of the Court. From this it is clear that true residues with the meaning of heading 23.03 only exist if from the basic product has been extracted all the starch which it is possible to obtain by applying modern procedures with due regard for economy (see the judgment of 18 June 1970 in Cases 72 and 74/69 [1970] ECR 427 and 451, and of 14 June 1971 in Cases 12 and 14/71 [1971] ECR 743 and 779). This amounts to saying that the essential criterion is the starch content, which appears also to be the determining factor with regard to the nutritional value. However I do not consider that it is appropriate to mention percentages in this case either since it is another point on which there appears to be no agreement between the various parties concerned. These factors, too, must be determined by the national court which, it seems, is required to take into account the fact that the gluten remaining after the starch has been removed shows starch contents equal to those which are also displayed by certain very rich animal feedstuff's. Moreover the only additional observation which I consider may still be made is that the plaintiff's submissions on the necessity for making the distinction turn also on the ash content are not convincing. It has not succeeded in deriving support from the rates of levy fixed for bran and for flour, since that is a quite different problem of demarcation and levies are always imposed on bran and indeed extremely high levies are imposed upon bran which is rich in starch. In addition, there is certainly no possibility that the common market in animal feedstuffs might be disturbed. I should like to observe, furthermore, that it appears easy to manipulate the ash content and that the latter consequently cannot constitute a criterion for ascertaining with certainty whether a product is a genuine residue from the extraction of starch. The principles which I have deduced regarding the distinction between products of the milling industry referred to in heading 11.01 and residues from the extraction of starch also apply to the distinction to be made between residues from the extraction of oil from maize referred to in heading 23.04. In this respect it is important to observe that the oil is found principally in the maize germ; on the other hand, although the plaintiff has indicated that modern methods of cultivation produce grains which also contain oil it seems clear that it is only present in very small quantities. When oil is extracted from maize germ it is clearly impossible to consider as genuine residues within the meaning of heading 23.04 either the degermed maize grains or the products obtained by milling those grains. In fact (as has already been established in other cases) they are products of the milling industry to which reference is made in headings 11.01 and 11.02 since the products in question are similar to the latter with regard to their composition, the use for which they are intended and their commercial value. There can only be considered the true waste which remains from the constituents necessary for the extraction of oil as a residue in the proper sense of the word when recourse is had to modern methods of extraction. In this connexion it is clear that the decisive criterion consists in the oil content which appears to fluctuate according to the process used (pressing or other methods of extraction). Furthermore (as the Commission has rightly observed) it also seems that a high proportion of germ tissue is a characteristic factor for the identification of such residues. The starch content seems to vary like the oil content of residues, apparently according to whether the germ is removed by the wet process, in which the maize germ is removed by soaking, or by the dry process in which fragments of grain are removed at the same time as the germ, which clearly affects the starch content. Once again the lack of unanimity amongst the various parties concerned renders it impossible for me to quote precise figures. In this case too the facts must be established by the national court which will have to take into consideration chiefly the methods currently used for the extraction of oil. I should further like to add that if the oil contained in the grain is also extracted by methods other than those I have mentioned until now, if (to adopt the plaintiff's wording) the grain in its entirety is included in the oil extraction, it is clear, in view of what I have already stated regarding the essential constituents of maize grain, particularly its low oil content, that it is impossible to regard what remains after carrying out a manufacturing process of this nature as waste within the meaning of heading 23.04. In fact the requirements of the organization of the market cause such a residue to be classified under one of the headings in the chapter on products of the milling industry since it is similar to the products comi ng under this chapter with regard to its composition, its possible used and its commercial value. In view of the necessarily abstract terms which one is constrained to use within the context of the procedure under Article 177, I do not think that it is possible to say anything further on the interpretation of heading 11.01 and the distinction to be drawn between that heading and the headings referring to residues. (c) Reference may also be made to the same considerations regarding the distinction to be drawn between heading 11.02 and the headings pertaining to residues from the extraction of starch and from the extraction of oil. The reason for this is that according to the Explanatory Notes to the Brussels Nomenclature the distinction between the products referred to in heading 11.01 and the products referred to in heading 11.02 relates solely to their structure (flours on the one hand and groats etc. on the other) and does not result from their composition. I have thus nothing to add regarding heading 11.02 of the Common Customs Tariff. (d) It is a little more difficult to reply to subquestion (c) in which the Finanzgericht asks the Court to what factual criteria must the composition of the forage preparations referred to in heading 23.07 conform when they contain products which fall within the field of application of Regulation No 19/62. In fact, as I have already indicated, the products covered by this heading are numerous. It is consequently impossible to supply an exhaustive description of them in this case; I can only give certain indications and clarify certain aspects which should enable the national court to reach the solution of the dispute before it. The first point to be borne in mind is that the word ‘preparations’ need not necessarily be understood in the sense of ‘mixtures’. The German Government (rightly it appears to me) has reached this conclusion on the basis of other tariff headings (headings 16.04 and 20.06) in which it seems clear that the word ‘preparations’ refers quite generally to a processing operation. This means that it is also possible to speak of a ‘preparation’ with regard to a processed product provided, however, that the operation to which the product is subjected goes beyond what is permissible under a specific tariff heading, in other words, on condition that the processing operation reaches a certain degree of industry. When in fact it is not only a processing procedure the general principles governing the interpretation of the nomenclature of the Common Customs Tariff provide that the processed product remains classified in the heading initially prescribed. In this respect it is of interest to note that the Explanatory Notes to the Brussels Nomenclature on heading 23.07 expressly exclude goods which have merely been subjected to pressing. Furthermore, according to the statements of the German Government, examples based on the practice followed by the Customs Co-operation Council, Brussels, show that not only mixtures are regarded as preparations within the meaning of heading 23.07 but certain processed products have also been classified under this heading (for example milled waste bread unfit for human consumption and the products known as solubles obtained by processing fish). In this respect however (particularly in view of headings 23.03 and 23.04) the residues and wastes in question cannot merely originate in a processing operation applied to products coming under one and the same tariff heading. In such a case, indeed, heading 23.07 could be applied only if another substance, such as molasses, had been added to the waste (it seems that this is a common practice in order to use such waste rationally). Inasmuch as heading 23.07 relates to mixtures it should further be noted that the definition of that heading by no means implies that it concerns mixtures of products coming under different tariff headings. Here too the Federal Government relies on certain classification opinions of the Customs Co-operation Council to this effect. Since, according to the case-law of this Court, the explanations given in those opinions may be taken into consideration within the framework of Community law in order to resolve problems of tariff classification, the national court ought thus to consider them in this connexion. Nevertheless I should like to observe that it would be unreasonable to include in the system of levies by the expedient of heading 23.07 a mixture of products which are not specifically referred to as such in the rules of the organization of the market. I am also of the opinion that in considering mixtures there are grounds for ignoring mere impurities in cereals and substances added in insignificant quantities unless they are used in small quantities owing to their special effectiveness (as in the case of vitamins). However, in this case also it seems impossible to quote percentages. Even as regards molasses and the fact that the Explanatory Notes to the Brussels Nomenclature merely state that sweetened forage within the meaning of heading 23.07generally contains a proportion of molasses of more than 10 % by weight, it is still possible that small percentages may constitute sufficient justification for classifying the product under heading 23.07. The sole case in which molasses must not be taken into consideration in the present context is where it is used as a simple binder‘generally not exceeding 3 % by weight’ (to adopt the wording of note (a) appearing at the end of the Explanatory Notes to the Brussels Nomenclature on heading 23.07). The foregoing remarks seem to me to constitute the substance of the rules which may be deduced for the purposes of the interpretation of tariff heading 23.07 in relation to the matters before the court making the reference. The only further remark which I can add is that according to the principles stated in the case-law of this Court it may also be important to determine whether a product should be given the same tariff classification as prepared animal fodder, as unusually encountered in the trade, because it is similar thereto in composition, possible uses and commercial value. These are the indications which should in my view enable the national court to resolve the problems of tariff classification raised in the dispute which it is called upon to settle.