Judgment of the Court of 4 April 1968. - Firma August Stier v Hauptzollamt Hamburg-Ericus. - Reference for a preliminary ruling: Finanzgericht Hamburg - Germany. - Case 31-67.



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Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

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1 . POLICY OF THE EEC - COMMON RULES - TAX PROVISIONS - TAXATION - TAXATION FORMING PART OF A GENERAL TAX APPLYING WITHOUT DISTINCTION TO DOMESTIC AND IMPORTED PRODUCTS - NATURE OF INTERNAL TAXATION

( EEC TREATY, ARTICLE 95 )

2 . POLICY OF THE EEC - COMMON RULES - TAX PROVISIONS - INTERNAL TAXATION IMPOSED BY A MEMBER STATE ON PRODUCTS FROM MEMBER STATES - ABSENCE OF SIMILAR DOMESTIC PRODUCTS OR OTHER PRODUCTS CAPABLE OF BEING PROTECTED - PERMISSIBILITY - LIMITS OF RIGHT OF A MEMBER STATE TO IMPOSE TAXATION

( EEC TREATY, ARTICLE 95 )

Summary

1 . TAXATION LEVIED WITHIN THE FRAMEWORK OF LEGISLATION RELATING TO THE TURNOVER TAX APPLYING WITHOUT DISTINCTION TO ALL CATEGORIES OF PRODUCTS, WHETHER DOMESTIC OR IMPORTED, DOES NOT CONSTITUTE A SPECIFIC TAX ON IMPORTED PRODUCTS EVEN IF CHARGED AT THE MOMENT OF IMPORTATION .

CF . PARAGRAPH 4, SUMMARY, JUDGMENT IN CASE 25/67 ( 1968 ) ECR 207 .

2 . THE PROVISIONS OF ARTICLE 95 OF THE EEC TREATY DO NOT PROHIBIT MEMBER STATES FROM IMPOSING INTERNAL TAXATION ON IMPORTED PRODUCTS FROM OTHER MEMBER STATES WHEN THERE IS NO SIMILAR DOMESTIC PRODUCT OR OTHER DOMESTIC PRODUCT CAPABLE OF BEING PROTECTED . NEVERTHELESS IT WOULD NOT BE PERMISSIBLE FOR MEMBER STATES TO IMPOSE ON SUCH PRODUCTS CHARGES OF SUCH AN AMOUNT THAT THE FREE MOVEMENT OF GOODS WITHIN THE COMMON MARKET WOULD BE IMPEDED AS FAR AS THOSE PRODUCTS WERE CONCERNED . SUCH A RESTRAINT ON THE FREE MOVEMENT OF GOODS CANNOT HOWEVER BE PRESUMED TO EXIST WHEN THE RATE OF TAXATION REMAINS WITHIN THE GENERAL FRAMEWORK OF THE NATIONAL SYSTEM OF TAXATION OF WHICH THE TAX IN QUESTION IS AN INTEGRAL PART .

CF . PARAGRAPH 1, SUMMARY, JUDGMENT IN CASE 27/67 .

Parties

IN CASE 31/67

REFERENCE TO THE COURT UNDER ARTICLE 177 OF THE EEC TREATY BY THE FINANZGERICHT ( FINANCE COURT ), HAMBURG, FOR A PRELIMINARY RULING IN THE ACTION PENDING BEFORE THAT COURT BETWEEN

FIRMA AUGUST STIER, HAMBURG,

AND

HAUPTZOLLAMT ( PRINCIPAL CUSTOMS OFFICE ), HAMBURG-ERICUS,

Subject of the case

ON THE INTERPRETATION OF THE TREATY ESTABLISHING THE EEC, ESPECIALLY ARTICLE 95 THEREOF,

Grounds

P . 240

BY ORDER OF 11 AUGUST 1967, WHICH REACHED THE COURT ON 18 AUGUST 1967, THE FINANZGERICHT, HAMBURG, BY VIRTUE OF ARTICLE 177 OF THE TREATY ESTABLISHING THE EEC, ASKED SEVERAL QUESTIONS RELATING TO THE INTERPRETATION OF THE SAID TREATY AND IN PARTICULAR ARTICLE 95 THEREOF .

( 1 ) QUESTION ( A ) INQUIRES SUBSTANTIALLY WHETHER THE TREATY MUST BE INTERPRETED AS PROHIBITING A MEMBER STATE FROM IMPOSING INTERNAL TAXATION ON IMPORTED PRODUCTS ORIGINATING IN ANOTHER MEMBER STATE ' WHICH COMPETE NEITHER WITH SIMILAR DOMESTIC PRODUCTS WITHIN THE MEANING OF THE FIRST PARAGRAPH OF ARTICLE 95 OF THE TREATY ESTABLISHING THE EEC NOR WITH DOMESTIC PRODUCTS WHICH MAY BE SUBSTITUTED FOR THEM WITHIN THE MEANING OF THE SECOND PARAGRAPH OF ARTICLE 95 OF THE TREATY '.

IN QUESTION ( B ) THE COURT MAKING THE REFERENCE INQUIRES WHETHER, IN THE EVENT OF THE TREATY'S PROHIBITING THE IMPOSITION OF CHARGES ON THE PRODUCTS REFERRED TO IN QUESTION ( A ), SUCH A RULE HAS DIRECT LEGAL EFFECT IN FAVOUR OF INDIVIDUALS .

THE QUESTIONS PUT, HAVING REGARD TO THE FACT THAT THE COURT MAKING THE REFERENCE MENTIONS THE PROVISIONS OF ARTICLE 95, REFER TO THE INTERNAL TAXATION DEALT WITH IN THAT ARTICLE .

TAXATION SUCH AS THAT WHICH IS THE SUBJECT OF THE MAIN ACTION, LEVIED WITHIN THE FRAMEWORK OF LEGISLATION RELATING TO THE TURNOVER TAX, DOES NOT CONSTITUTE A SPECIFIC TAX ON IMPORTED PRODUCTS, BUT A GENERAL TAX APPLYING WITHOUT DISTINCTION TO ALL CATEGORIES OF PRODUCTS, WHETHER DOMESTIC OR IMPORTED, EVEN IF CHARGED AT THE MOMENT OF IMPORTATION .

IN PRINCIPLE SUCH TAXES COME WITHIN THE CONCEPT OF INTERNAL TAXATION REFERRED TO IN ARTICLE 95, WHICH IS MOREOVER CONFIRMED AS FAR AS THE TURNOVER TAX IS CONCERNED BY SEVERAL ARTICLES IN THE SAME CHAPTER RELATING TO FISCAL PROVISIONS .

ARTICLE 95 IS INTENDED TO ENSURE THAT THE APPLICATION OF INTERNAL TAXATION IN ONE MEMBER STATE DOES NOT HAVE THE EFFECT OF IMPOSING ON PRODUCTS ORIGINATING IN OTHER MEMBER STATES TAXATION IN EXCESS OF THAT IMPOSED ON SIMILAR DOMESTIC PRODUCTS OR TAXATION OF SUCH A NATURE AS TO PROTECT OTHER DOMESTIC PRODUCTS REFERRED TO IN THE SECOND PARAGRAPH OF THE SAME ARTICLE .

P . 241

ALTHOUGH IN ESSENCE ARTICLE 95, BOTH BY THE PRECISION OF THE FIRST PARAGRAPH AND BY THE GENERAL NATURE OF THE TERMS OF THE SECOND PARAGRAPH, CONTRIBUTES TO THE CREATION OF A COMMON MARKET ENSURING THE FREE MOVEMENT OF GOODS, NEVERTHELESS ITS AMBIT WOULD BE EXTENDED BEYOND ITS PROPER OBJECTIVE IF ONE WERE TO DEDUCE FROM IT A PROHIBITION ON THE IMPOSITION OF INTERNAL TAXATION ON IMPORTED GOODS WHICH DO NOT COMPETE WITH A DOMESTIC PRODUCT .

INTERNAL TAXATION AND ESPECIALLY THE TURNOVER TAX HAVE AN ESSENTIALLY FISCAL OBJECTIVE .

HENCE THERE ARE NO REASONS WHY CERTAIN IMPORTED PRODUCTS SHOULD BENEFIT FROM A PRIVILEGED SYSTEM BY REASON OF THE FACT THAT THERE ARE NO NATIONAL PRODUCTS CAPABLE OF BEING PROTECTED .

IN FACT SUCH A TAX, WHEN CHARGED ON IMPORTATION, EVEN ON PRODUCTS NOT COMPETING WITH DOMESTIC PRODUCTS, IS INTENDED TO PLACE IN A COMPARABLE FISCAL SITUATION ALL CATEGORIES OF PRODUCTS, WHATEVER THEIR ORIGIN .

ACCORDINGLY IT IS APPROPRIATE TO REPLY TO THE FIRST QUESTION BY A FINDING THAT ARTICLE 95 DOES NOT PROHIBIT MEMBER STATES FROM IMPOSING INTERNAL TAXATION ON IMPORTED PRODUCTS WHEN THERE IS NO SIMILAR DOMESTIC PRODUCT OR OTHER DOMESTIC PRODUCT CAPABLE OF BEING PROTECTED .

CONSEQUENTLY, QUESTION ( B ) HAS NO PURPOSE .

( 2 ) QUESTION ( C ) INQUIRES WHETHER, IN THE CASES REFERRED TO IN QUESTION ( A ), THE TREATY FIXES LIMITS WITH REGARD TO THE AMOUNT OF INTERNAL TAXATION AFFECTING THE IMPORTED PRODUCT, AND, IF SO, REQUESTS THE COURT TO RULE WHAT THOSE LIMITS ARE .

ALTHOUGH ARTICLE 95, AS HAS JUST BEEN STATED, DOES NOT PROHIBIT MEMBER STATES FROM IMPOSING TAXATION ON IMPORTED PRODUCTS, NEVERTHELESS IT WOULD NOT BE PERMISSIBLE FOR THEM TO IMPOSE ON PRODUCTS WHICH, IN THE ABSENCE OF COMPARABLE DOMESTIC PRODUCTION, WOULD ESCAPE FROM THE APPLICATION OF THE PROHIBITIONS CONTAINED IN ARTICLE 95, CHARGES OF SUCH AN AMOUNT THAT THE FREE MOVEMENT OF GOODS WITHIN THE COMMON MARKET WOULD BE IMPEDED AS FAR AS THOSE PRODUCTS WERE CONCERNED .

SUCH A RESTRAINT ON THE FREE MOVEMENT OF GOODS CANNOT HOWEVER BE PRESUMED TO EXIST WHEN THE RATE OF TAXATION REMAINS WITHIN THE GENERAL FRAMEWORK OF THE NATIONAL SYSTEM OF TAXATION OF WHICH THE TAX IN QUESTION IS AN INTEGRAL PART .

Decision on costs

THE COSTS INCURRED BY THE GOVERNMENT OF THE FEDERAL REPUBLIC OF GERMANY AND BY THE COMMISSION OF THE EUROPEAN COMMUNITIES, WHICH HAVE SUBMITTED THEIR OBSERVATIONS TO THE COURT, ARE NOT RECOVERABLE, AND AS THESE PROCEEDINGS ARE, IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED, A STEP IN THE ACTION PENDING BEFORE THE FINANZGERICHT, HAMBURG, THE DECISION ON COSTS IS A MATTER FOR THAT COURT .

Operative part

THE COURT

IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE FINANZGERICHT, HAMBURG, BY ORDER OF THAT COURT DATED 11 AUGUST 1967, HEREBY RULES :

1 . THE PROVISIONS OF ARTICLE 95 OF THE TREATY ESTABLISHING THE EUROPEAN ECONOMIC COMMUNITY DO NOT PROHIBIT MEMBER STATES FROM IMPOSING INTERNAL TAXATION ON IMPORTED PRODUCTS ORIGINATING IN OTHER MEMBER STATES WHEN THERE IS NO SIMILAR DOMESTIC PRODUCT OR OTHER DOMESTIC PRODUCTS CAPABLE OF BEING PROTECTED;

2 . IN THE CASES REFERRED TO IN PARAGRAPH 1 ABOVE, THE TREATY DOES NOT HAVE THE EFFECT OF RESTRICTING THE FREEDOM OF MEMBER STATES TO FIX RATES OF TAXATION WHICH REMAIN WITHIN THE GENERAL FRAMEWORK OF THE NATIONAL SYSTEM OF INTERNAL TAXATION OF WHICH THE TAX IN QUESTION FORMS PART;

AND DECLARES :

IT IS FOR THE COURT MAKING THE REFERENCE TO DECIDE AS TO THE COSTS IN THIS ACTION .