C —

However, these indications only constitute a first approach to the problem. In Question 5(a) and (b), you are asked whether the concept of obstacles to trade always presupposes that the duty imposed is discriminatory or protective in effect and whether obstacles to trade could exist in the absence of competition from domestic products. This question is submitted in connexion with Articles 9 and 12 (that is, in connexion with charges having equivalent effect), but it is also relevant in defining the internal taxation referred to in Article 95 since Articles 12 and 13 on the one hand and Article 95 on the other cannot be jointly applied to the same case (16 June 1966, Lütticke, Case 57/65, [1966] E.C.R. 205). First let me make some observations regarding terminology: the Commission observes, in connexion with the way in which this question is formulated, that Articles 9 and 12 do not refer to obstacles to trade and that, in certain circumstances and by virtue of other provisions of the Treaty, taxation or charges may be imposed on imported products and the effect of this is always, to however small a degree, to restrict imports. This observation is correct but the fact remains that the articles the interpretation of which is sought are included under Title I of Part Two, entitled ‘Free movement of goods’, which is the indication of a principle and of the intention of the authors of the Treaty to eliminate such obstacles to trade. Nevertheless, the two parts of the question submitted are closely connected: if a charge having equivalent effect within the meaning of Article 12 exists only if its effects are protective or discriminatory, a charge on an imported product which has no competition on a national level necessarily falls outside the scope of Article 12. It may well be asked whether the answer to this question has not already been given in your judgment in Joined Cases 2 and 3/62 referred to earlier, from which I quote the following passage: ‘A charge having equivalent effect … whatever it is called and whatever its mode of application, may be regarded as a duty imposed unilaterally either at the time of importation or subsequently, and which, if imposed specifically upon a product imported from a Member State to the exclusion of a similar domestic product, has, by altering its price, the same effect upon the free movement of products as a customs duty.’ This concept is expressed in almost identical terms in your judgment of 8 July 1965 in the Waldemar Deutschmann case (Case 10/65, [1965] E.C.R. 469) as well as in your judgment of 16 July 1966 in the case of the Federal Republic of Germany v Commission of the EEC (Joined Cases 52 and 55/65, [1966] E.C.R. 159). It thus appears to be very comprehensive to the extent to which the discriminatory effect—‘however small it may be’ in the words of the judgment in Joined Cases 52 and 55/65 — is sufficient for a charge on imported products to have an effect equivalent to a customs duty, although it is confined to the hypothesis that a similar domestic product exists. I believe that it is useful to examine this case-law more thoroughly, to clarify it and, if necessary, to amend it. It will first be noted that in the cases which gave rise to the judgments to which I have referred the imported products were always in competition with similar domestic products. Within the context of the problems submitted to you, it was sufficient to establish the discriminatory nature of the charge in order to accept that its effect was equivalent to that of a customs duty. Furthermore, you have always asserted that the legality of a tax should be determined ‘in the light of the objectives of the Treaty’. According to Article 3 these are, in particular: (a) The elimination, as between Member States, of customs duties and of quantitative restrictions on the import and export of goods, and of all other measures having equivalent effect; (b) The establishment of a common customs tariff and of a common commercial policy towards third countries; (c) The institution of a system ensuring that competition in the Common Market is not distorted. To achieve these objectives the Treaty prescribes the elimination of all customs duties and makes no distinction according to whether the products affected are or are not in competition with domestic products. Thus, by virtue of Article 17, the provisions relating to the elimination of customs duties shall also apply to customs duties of a fiscal nature. It is in the same spirit that the Treaty provides for the abolition of export duties. It may therefore be contended that the aim is not merely to abolish discrimination or the protection of the national industry but of all obstacles to trade. Consequently, this concept is not absent from your case-law. Of course, you referred first to the idea of discrimination and you considered that, once such discrimination was established, a charge having equivalent effect existed since, however slight such discrimination, it was likely to distort competition and to create obstacles to trade and was therefore contrary to the objectives of the Treaty. But although discrimination is more often than not a feature of a charge having equivalent effect, it does not necessarily follow that it is a condition sine qua non of its existence. By definition, customs duties only apply to goods crossing a frontier and to justify their prohibition it is sufficient to establish that they constitute an obstacle to the free movement of goods. The same criterion may be applied to charges which, although not appearing to be customs duties, form in the same way an obstacle to the free movement of goods without, however, being included in the general system of internal taxation referred to in Article 95 of the Treaty. However, it the creation of an obstacle to trade is adopted as the only criterion there is no need to distinguish between charges imposed on goods for which there are corresponding domestic products and those imposed on products which do not meet such competition, as the fact that certain goods are not produced in a Member State cannot confer on that State the right to impose import duties on such goods within the context of Article 12. Free movement of goods which is the objective of Title I of Part Two of the Treaty is a rule which applies equally to all products within the Community. It may be objected that such a strict concept of freedom of trade ignores the facts and that so small a charge as, for instance, the ‘contribution’ which gave rise to the action before the Vrederechter, Antwerp, cannot in reality have any influence on the market. But every effort must be made to avoid anything which might open a breach in the system founded on the prohibition of customs duties and charges having equivalent effect. This is a danger which is already referred to in your judgment in Joined Cases 2 and 3/62 and the creation of special funds financed by contributions imposed on the import of goods would be one of the ways to which States might be particularly tempted to resort in order to circumvent the provisions of Articles 9 and 12 of the Treaty. To sum up, I consider finally that an obstacle to the free movement of goods may exist even if a charge having equivalent effect has no discriminatory or protectionist consequences and even if there is no competition from domestic products. This solution, however, is not obvious; in case you should not adopt it I should like to define my attitude to certain points raised in the Commission's observations which exceed the scope of the question as submitted by the Belgian court. On the basis not of Articles 9 and 12 but of Article 95, the Commission points out that your caselaw (especially your judgments in Cases 27/67 and 31/67 of 4 April 1968) accepts that it is possible to impose internal taxation on products from other Member States which do not compete with similar or substitute products. You decided that this was the case as regards taxation imposed within the framework of legislation concerning turnover tax, that is, a general charge imposed without distinction on all categories of products both domestic and imported, as you considered that when such taxation is imposed on imports it is intended to put on a comparable fiscal footing all categories of products whatever their origin, and that there is no reason for certain imported products to enjoy a privileged position because no similar domestic products exist to be protected. However, you laid down the condition that the rate fixed for these products shall remain within the general framework of the system of taxation in question. From this starting point, the Commission states that on the basis of the Treaty no Member State can be denied the right to introduce special internal taxation on products for which no corresponding products of domestic manufacture exist. Subject to the condition that in such a case the rate of taxation is not to exceed ‘the internal taxation as a whole imposed on these products and others’, there can be no more justification in this case for granting tax privileges in respect of products which are not manufactured in the country than in the case of the general system of turnover tax. I would merely say that in my opinion the assimilation of these two cases appears debatable as, if the taxation is special, there cannot by definition be any question of putting the product which is subject thereto in a comparable position to that of other products, and if the imported goods which do not compete with a domestic product were not subject to the tax it would not enjoy any special privilege. But, here again, we are dealing with an issue outside the framework determined by the Belgian court.