WRITTEN QUESTION E-1709/02

by Nuala Ahern (Verts/ALE) to the Commission

(13 June 2002)

Subject: Movement of goods

An Irish person returning home after working a number of years in Spain wishes to bring back some Spanish wine to Ireland. However, both the UK and Irish customs are placing obstacles in bringing back Spanish wine in any quantity. In particular there are quantitative restrictions on the amount and the requirement that the wine must accompany or else duty and tax paid. Is this not contrary to the spirit of the Treaty and free movement of goods?

Answer given by Mr Bolkestein on behalf of the Commission

(1 October 2002)

The establishment and functioning of the internal market requires the free movement of goods, including those subject to excise duties. The rules designed to achieve that aim were set out in Directive 92/12/EEC(1) on the holding and movement of goods subject to excise duty. That Directive's primary aim was to ensure the free commercial movement between Member States of products subject to excise duty, excise duty being paid on them once only in the Member State of final consumption.

However, it was also recognized that citizens often purchase goods for their own use in a Member State other than that in which they intend to consume them. It was never intended that such purchases should attract duty in the Member State of final consumption. Article 8 of the Directive therefore reversed the general rule and required that in such cases, duty was to be paid in the Member State in which the products are purchased. The Article is, however, subject to certain conditions designed to ensure that the transactions concerned are devoid of any commercial nexus. Crucially for the purposes of the honourable Member's question, the goods concerned must be transported by the purchaser.

In case C-296/95(2) the Court of Justice examined that requirement in detail. The Court, having regard to the precise wording of the provision in all Community languages, indicated in its judgement that Article 8 of the Directive applies only where no agent is involved in the transport of the goods: the private individual who has acquired the goods must transport them himself.

Therefore, if a private individual transports the excisable goods himself, excise duty shall only be charged in the country of acquisition as long as the individual concerned has acquired the goods for his own use (without quantitative restrictions).

If a third person is involved in the transport of the goods, for instance a moving company, a strict interpretation of judgement C-296/95 might lead to the conclusion that Article 8 of Directive 92/12/EEC is not applicable. As a consequence, the excisable goods would be taxed in the country of destination.

However, the Commission takes the view that the strict interpretation of the term transported by them should apply only to movements which are directly or indirectly commercial in nature, and not to situations such as the one referred to by the Honourable Member, in which a private person transfers his personal property from one Member State to another in connection with a transfer of his normal residence. Until now, this interpretation of the Commission has not been confirmed by the European Court of Justice.

The Commission is at present preparing a report on the application of articles 7 to 10 of Directive 92/12/EEC. In this context, the Commission will examine whether clarifications to the Directive might be required in order to provide legal certainty in the situations referred to by the Honourable Member.

(1) Council Directive 92/12/EEC of 25 February 1992 on the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products (OJ L 76, 23.3.1992, p. 1).

(2) Judgment of the Court of 2 April 1998, The Queen v Commissioners of Customs and Excise, ex parte EMU Tabac SARL, The Man in Black Ltd, John Cunningham, ECR 1998 I-1605.