CELEX: 62018CC0068
Language: en
Date: 2019-05-16 00:00:00
Title: Opinion of Advocate General Szpunar delivered on 16 May 2019.#SC Petrotel-Lukoil SA v Agenţia Naţională de Administrare Fiscală - Direcţia Generală de Administrare a Marilor Contribuabili and Agenţia Naţională de Administrare Fiscală – Direcţia Generală de Soluţionare a Contestaţiilor.#Request for a preliminary ruling from the Curtea de Apel Bucureşti.#Reference for a preliminary ruling — Taxation of energy products and electricity — Directive 2003/96/EC — Article 21(3) — No chargeable event giving rise to taxation — Consumption of energy products on a site that produces such products — Article 2(3) — Obligation to obtain a classification for energy products in order to determine the level of excise duty — Tax rate applicable to those products — Principle of proportionality.#Case C-68/18.

OPINION OF ADVOCATE GENERAL
      SZPUNAR
      delivered on 16 May 2019 (
            1
         )
      
         Case C‑68/18
      
      SC Petrotel-Lukoil SA
      v
      Agenţia Naţională de Administrare Fiscală — Direcţia Generală de Administrare a Marilor Contribuabili,
      Agenţia Naţională de Administrare Fiscală — Direcţia Generală de Soluţionare a Contestaţiilor
      
         (Request for a preliminary ruling from the Curtea de Apel Bucureşti (Bucharest Court of Appeal, Romania))
      
      (Reference for a preliminary ruling — Directive 2003/96/EC — Taxation of energy products and electricity — Exemptions — Consumption of energy products on a site that produces such products — Obligation to obtain a classification for energy products in order to determine the level of excise duty — Tax rate applicable to those products)
      
         Introduction
      
      
               1.
            
            
               Member States have the right to impose a variety of obligations on taxpayers in order to prevent tax evasion and avoidance. However, these measures must not result in the taxation of products subject to harmonised tax legislation in a manner that is not in line with the provisions of EU law. The Court has already ruled thus on the taxation of energy products and will have the opportunity to confirm that case-law in the present case. In addition, this case concerns the relationship between the taxation of energy products and electricity in the specific context of the production of those products for the manufacturer’s own requirements.
            
         
         Legal framework
      
      
         
            EU law
         
      
      
               2.
            
            
               Article 1 of Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity (
                     2
                  ) provides:
               ‘Member States shall impose taxation on energy products and electricity in accordance with this Directive.’
            
         
               3.
            
            
               Article 2 of the directive provides that:
               ‘1.   For the purposes of this Directive, the term “energy products” shall apply to products:
               …
               
                        (b)
                     
                     
                        falling within CN codes 2701, 2702 and 2704 to 2715;
                     
                  …
               2.   This Directive shall also apply to:
               Electricity falling within CN code 2716.
               3.   When intended for use, offered for sale or used as motor fuel or heating fuel, energy products other than those for which a level of taxation is specified in this Directive shall be taxed according to use, at the rate for the equivalent heating fuel or motor fuel.
               …
               4.   This Directive shall not apply to:
               …
               
                        (b)
                     
                     
                        the following uses of energy products and electricity:
                        
                                 –
                              
                              
                                 energy products used for purposes other than as motor fuels or as heating fuels,
                              
                           
                  …’
            
         
               4.
            
            
               Article 14(1)(a) of Directive 2003/96 states:
               ‘In addition to the general provisions set out in Directive 92/12/EEC [ (
                     3
                  )] on exempt uses of taxable products, and without prejudice to other Community provisions, Member States shall exempt the following from taxation under conditions which they shall lay down for the purpose of ensuring the correct and straightforward application of such exemptions and of preventing any evasion, avoidance or abuse:
               
                        (a)
                     
                     
                        energy products and electricity used to produce electricity and electricity used to maintain the ability to produce electricity …’
                     
                  
         
               5.
            
            
               Lastly, Article 21 of Directive 2003/96 provides:
               ‘1.   In addition to the general provisions defining the chargeable event and the provisions for payment set out in Directive 92/12/EEC, the amount of taxation on energy products shall also become due on the occurrence of one of the chargeable events mentioned in Article 2(3).
               …
               3.   The consumption of energy products within the curtilage of an establishment where energy products are produced shall not be considered a chargeable event giving rise to taxation if the consumption consists of energy products produced within the curtilage of the establishment. … Where the consumption is for purposes not related to the production of energy products and in particular for the propulsion of vehicles, this shall be considered a chargeable event, giving rise to taxation.
               …
               5.   For the purposes of applying Articles 5 and 6 of Directive 92/12/EEC, electricity and natural gas shall be subject to taxation and shall become chargeable at the time of supply by the distributor or redistributor. …
               …
               An entity producing electricity for its own use is regarded as a distributor. …
               …’
            
         
         
            Romanian law
         
      
      
               6.
            
            
               Directive 2003/96 was transposed into the Romanian legal order by the Codul Fiscal — Legea No 571/2003 (Law No 571/2003 on the Tax Code) of 22 December 2003. Up to 31 March 2010 taxable products were specified in Article 175 of this law and by Article 20616 thereof as from 1 April 2010. Article 21(3) of Directive 2003/96 was transposed respectively in Article 175(7) and Article 20616(7) thereof.
            
         
               7.
            
            
               According to the provisions of the Hotărârea Guvernului României No 44/2004 pentru aprobarea Normelor metodologice de aplicare a Legii No 571/2003 privind Codul fiscal (Government Regulation No 44/2004 on the approval of rules implementing Law No 571/2003 establishing the Tax Code) of 22 January 2004:
               ‘Article 175
               5. (1)   Energy products other than those referred to in Article 175(3) [of the Law on the Tax Code] shall be subject to excise duty when:
               
                        (a)
                     
                     
                        the products are manufactured for use as heating fuel or motor fuel;
                     
                  
                        (b)
                     
                     
                        the products are offered for sale as heating fuel or motor fuel;
                     
                  
                        (c)
                     
                     
                        the products are used as heating fuel or motor fuel.
                     
                  (2)   Any economic operator in one of the situations referred to in paragraph 1 shall be required, before the production, offering for sale or use of energy products, to submit a request to the Ministerul Finanțelor Publice — Comisia cu atribuții în autorizarea antrepozitelor fiscale [Ministry of Public Finances — Office for the issue of tax warehouse authorisation, Romania] for classification of those products for the purposes of excise duty. That request must be accompanied by the test report for the relevant product, issued by a recognised laboratory, by the tariff classification of the product by the Autoritatea Națională a Vămilor [National Customs Authority, Romania] and by the opinion from the Ministerul Economiei și Comerţului [Ministry of the Economy and Trade, Romania] on the equivalence of that product to an equivalent product for which excise duties have been determined.
               …
               (4)   As regards products, … for which the economic operator has failed to fulfil the obligations referred to in paragraphs 2 and 3, the excise duty payable in the case of motor fuel shall correspond to the tax payable for leaded petrol and, in the case of heating fuel, the excise duty payable is that determined for gas oil.’
            
         
               8.
            
            
               Similar implementing rules apply to Article 20616 of the abovementioned law.
            
         
         Facts, procedure and the questions referred
      
      
               9.
            
            
               SC Petrotel-Lukoil SA, a company established under Romanian law (‘Petrotel-Lukoil’), produces energy products, in particular different types of motor fuel. In this regard it also produces, inter alia, products referred to as ‘40/42S heating oil’ and ‘semi-processed heating oil’ coming under CN code 27079999.
            
         
               10.
            
            
               The referring court submits, in its order for reference, a very wide-ranging description of the facts of the dispute between Petrotel-Lukoil and the Romanian tax authorities. From the point of view of the answers to questions on the interpretation of EU law, only the following factual elements would appear to be relevant.
            
         
               11.
            
            
               Following a check, the Romanian tax authorities established that, during the period from 1 January 2009 to 31 December 2011, Petrotel-Lukoil had used ‘40/42S heating oil’ and ‘semi-processed heating oil’ as heating fuel both on its technological sites producing energy products and in its own combined heat and power plant in order to obtain steam for the generation of heat and electricity. The tax authorities also established that Petrotel-Lukoil had not submitted a request for the classification of the product described as ‘semi-processed heating oil’ for a determination of the excise duty payable.
            
         
               12.
            
            
               As a result of those findings, on 18 December 2014 the Romanian tax authorities issued a decision imposing additional excise duty by reason of the consumption of the abovementioned energy products in the combined heat and power plant belonging to Petrotel-Lukoil. This decision also imposed the tax rate applicable to gas oil on the product described as ‘semi-processed heating oil’.
            
         
               13.
            
            
               Petrotel-Lukoil’s appeal against that decision was dismissed on 11 November 2015. In addition, on 27 April 2015, the company obtained a classification of heating oil for the product described as ‘semi-processed heating oil’.
            
         
               14.
            
            
               On 5 January 2016 Petrotel-Lukoil brought an action before the referring court by which it sought annulment of part of the abovementioned administrative decisions and the refund of the excise duty overpayments.
            
         
               15.
            
            
               In those circumstances, the Curtea de Apel Bucureşti (Bucharest Court of Appeal, Romania) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
               
                        ‘(1)
                     
                     
                        Do the provisions of Article 21(3) of [Directive 2003/96] preclude the provisions laid down in Article 175 of [Law No 571/2003 on the Tax Code], in force until 31 March 2010, and Article 20616 [of that law], in force as from 1 April 2010, and the rules arising therefrom?
                     
                  
                        (2)
                     
                     
                        Do the provisions of Article 2(3) of [Directive 2003/96] preclude the provisions laid down in Article 175 of [Law No 571/2003 on the Tax Code], in force until 31 March 2010, and in Article 20616 [of that law], in force as from 1 April 2010, and the rules arising therefrom?
                     
                  
                        (3)
                     
                     
                        Does the principle of proportionality preclude the State from taking no notice of the fact that the company, following the tax inspection, obtained a decision permitting “semi-processed heating oil” to be treated in the same way as “heating oil” and, at the time of investigation of the complaint of the taxpayer, preclude the excise duty initially calculated for “gas oil” from being maintained?’
                     
                  
         
               16.
            
            
               The request for a preliminary ruling was lodged at the Court on 2 February 2018. Petrotel-Lukoil, the Romanian Government and the European Commission submitted written observations. Those same parties were represented at the hearing held on 10 January 2019.
            
         
         Analysis
      
      
               17.
            
            
               The referring court does not make it clear which specific provisions of national legislation give rise to its doubts as to compatibility with EU law. However, on the basis of the comments submitted by the individual participants in the proceedings, it may be assumed that the case concerns the provisions, or their interpretation, that allow taxation of energy products consumed in the production of further energy products and electricity on the premises of the same establishment that produced those first energy products. In addition, the referring court may also have doubts concerning the taxation of the product described as ‘semi-processed heating oil’ using the tax rate applicable for diesel fuel, despite the fact that this product was subsequently classified as heating oil.
            
         
         
            The first question referred for a preliminary ruling
         
      
      
               18.
            
            
               By its first question referred for a preliminary ruling, the referring court is essentially seeking to establish whether Article 21(3) of Directive 2003/96 must be interpreted as precluding provisions of national legislation, or the interpretation thereof, that permit the taxation of energy products consumed in the production of further energy products or of electricity produced on the premises of the same establishment that produced the first energy products.
            
         
               19.
            
            
               The plant (refinery) belonging to Petrotel-Lukoil produces, inter alia, two energy products within the meaning of Article 2(1)(b) of Directive 2003/96, referred to as ‘40/42S heating oil’ and ‘semi-processed heating oil’. These products are used as fuel for firing the steam boiler in a combined heat and power (CHP) plant forming part of the facility. The steam obtained is then used for the production (co-generation) of heat and electricity.
            
         
               20.
            
            
               The parties to the dispute in the main proceedings disagree as to whether and to what extent the heat and electricity produced in this way are then used in the manufacturing process that produces the energy products that are the end products of the plant. This is a factual question that must be resolved by the referring court. It would appear, however, that both heat and electricity are, or at any rate could be, used both in the process of manufacturing energy products and for other purposes within the facility, such as heating offices and other areas, as well as providing them with electricity. In addition, they can be dispatched outside the facility to the district heating system and the electricity network. In order to provide the referring court with a useful answer to the questions which it has referred for a preliminary ruling, consideration should be given to the manner in which primary energy products are taxed in the light of the provisions of Directive 2003/96, depending on the different ways in which heat and electricity are used.
            
         
               21.
            
            
               Directive 2003/96 introduces the principle of taxation of energy products used as motor fuels or heating fuels and harmonises the rates of such taxation. The event giving rise to the tax obligation is the production or importation of energy products, as well as the events referred to in Article 2(3) of Directive 2003/96. However, tax becomes chargeable only when those products are released for consumption. The position is different with regard to electricity, where the tax becomes chargeable at the time of its delivery by the distributor or redistributor.
            
         
               22.
            
            
               Directive 2003/96 provides for a number of exceptions to the above principles. In particular, pursuant to the first sentence of Article 21(3), the consumption of energy products within the curtilage of an establishment producing energy products is not to be considered to be a chargeable event giving rise to taxation. However, according to the third sentence of that provision, where the consumption of the energy products in question is for purposes not related to the production of energy products, this is to be considered a chargeable event, giving rise to taxation.
            
         
               23.
            
            
               Article 21(3) of Directive 2003/96 does not specify how the energy products in question must be used in the production of energy products. What is clear is only that this relates to products used as heating fuels, since any other use, for example as raw materials, is not covered by the provisions of that directive. It is not, however, relevant whether these products are used directly in energy production facilities or, for example, are used to produce energy that is then used for subsequent production. It is also irrelevant whether, in the course of the production of this energy, an intermediate product such as steam is created.
            
         
               24.
            
            
               A similar conclusion has to be drawn with regard to energy products used for the production of electricity that is then used in the production of further energy products. There is nothing in the wording of Article 21(3) of Directive 2003/96 that allows for different tax treatment of energy products used to produce heat from those used to produce electricity, if they are then both used for the production of energy products.
            
         
               25.
            
            
               Furthermore, energy products used for the production of electricity are subject to a general exemption from taxation pursuant to the first sentence of Article 14(1)(a) of Directive 2003/96. However, in my opinion, Article 21(3) of that directive should apply as a lex specialis to energy products produced within the premises of an establishment producing such products and which are subsequently used for the production of energy products. (
                     4
                  )
            
         
               26.
            
            
               I do not, however, share the Commission’s view that electricity generated in the CHP plant on Petrotel-Lukoil’s refinery site and used in the production of energy products is not subject to taxation. This matter does not appear to be at issue in the main proceedings or in the questions referred for a preliminary ruling, but it may be useful to provide some clarity.
            
         
               27.
            
            
               Electricity is taxed at the rate payable at the time when it is supplied by a distributor or redistributor. Pursuant to the first sentence of the third subparagraph of Article 21(5) of Directive 2003/96, an entity producing electricity for its own requirements is regarded as a distributor, with the result that electricity produced for its own requirements is subject to taxation. In my view, the first sentence of Article 21(3) of the directive does not exclude this outcome.
            
         
               28.
            
            
               First, while electricity is subject to taxation under Directive 2003/96, it is not an energy product within the meaning of Article 2(1) of that directive, but constitutes a separate item regulated by Article 2(2) thereof. The expression ‘energy products’ contained in the first sentence of Article 21(3) of Directive 2003/96 therefore does not cover electricity. In the situation where the legislature introduces analogous rules for energy products and electricity, for example in the second sentence of Article 21(3) of the directive, both these types of product are explicitly mentioned.
            
         
               29.
            
            
               Secondly, while Directive 2003/96 prohibits, by the general exemption contained in Article 14(1)(a), the double taxation of electricity as well as energy products and electricity used for its production, no similar prohibition applies in the opposite direction. Thus, electricity used for the production of energy products is subject to taxation under the general rules. Looking at the issue in a wider context, Directive 2003/96 does not contain any ‘double taxation clause’ in relation to energy products and electricity used for the production of energy products. The only exception is the quasi exemption for products produced within the premises of the same establishment provided for in the first sentence of Article 21(3) of Directive 2003/96.
            
         
               30.
            
            
               Thirdly, and finally, I do not share the Commission’s view, as expressed during the hearing, as to the need to treat the energy product production process in a holistic way, which would result in an exemption from taxation of the electricity used in this process. The production process should indeed be taken as a whole when it comes to the taxation of energy products produced by the same facility and used for the purpose of that production. Such products are not subject to taxation, irrespective of whether they are used directly in the production of further energy products or via an intermediate product, such as steam. However, the situation is different when it comes to the production of a product that is subject to taxation under Directive 2003/96, such as electricity. In this case, the provisions of that directive must apply, and those provisions do not provide for any obligation to exempt from taxation electricity used in the production of energy products or for any general prohibition of double taxation from which such an obligation could be inferred.
            
         
               31.
            
            
               Where heat or electricity produced within the premises of an establishment producing energy products is not used for the purposes of that production but for other purposes, such as for supplying offices or other areas, the first sentence of Article 21(3) of Directive 2003/96 does not apply. This is stated clearly in the third sentence of that paragraph. Therefore, energy products used for the production of heat are taxed according to the general rules, whereas products used for the production of electricity are exempt under Article 14(1)(a) of the directive. However, the resulting electricity is subject to tax, as electricity produced for the producer’s own consumption is taxed when it is consumed.
            
         
               32.
            
            
               Finally, the first sentence of Article 21(3) of Directive 2003/96 does not apply to the production of heat and electricity dispatched outside the establishment, whether for district heating or to the power grid. This means that the use of energy products for the purposes of this production, even if they are produced in situ, is subject to general rules. Thus, energy products used for the production of heat are therefore taxed, whereas energy products used for electricity production are exempt under Article 14(1)(a) of Directive 2003/96.
            
         
               33.
            
            
               Taking into account the specific circumstances of the dispute in the main proceedings, the above findings may be summarised by stating that energy products produced within the premises of an establishment producing energy products:
               
                        –
                     
                     
                        are not subject to tax (no chargeable event) in so far as they are used for the production of heat (also in the form of steam) that is used for the production of energy products;
                     
                  
                        –
                     
                     
                        are not subject to tax (no chargeable event) in so far as they are used for the production of electricity that is used for the production of energy products;
                     
                  
                        –
                     
                     
                        are subject to tax in so far as they are used for the production of heat used for other purposes within the same establishment;
                     
                  
                        –
                     
                     
                        are not subject to tax (exemption) in so far as they are used for the production of electricity used for other purposes within the premises of the same establishment;
                     
                  
                        –
                     
                     
                        are subject to tax in so far as they are used for the production of heat supplied outside the establishment;
                     
                  
                        –
                     
                     
                        are not subject to tax (exemption) in so far as they are used for the production of electricity dispatched outside the establishment.
                     
                  
         
               34.
            
            
               At the same time, electricity produced within the premises of the establishment is subject to tax, which becomes chargeable at the time of its use, in so far as this electricity is used within the premises of that establishment, whether for the production of energy products or for other purposes, and also at the time when it is supplied by a distributor or redistributor in so far as it is dispatched outwith the premises of that establishment.
            
         
               35.
            
            
               My proposal, therefore, in response to the first question referred for a preliminary ruling is that Article 21(3) of Directive 2003/96 must be interpreted as precluding provisions of national legislation of a Member State, or an interpretation thereof, that permit the taxation of energy products produced within the premises of an establishment producing energy products that are used for the purposes of that production, irrespective of whether that use is made directly or through another product such as steam or electricity.
            
         
         
            The second and third questions referred for a preliminary ruling
         
      
      
               36.
            
            
               It should be borne in mind that Petrotel-Lukoil used a product that it produced itself and described as ‘semi-processed heating oil’ as a heating fuel in its CHP unit without having obtained a classification for this product for tax purposes. In the light of the foregoing, the Romanian tax authorities imposed tax on that product at the rate applicable to diesel fuel, in accordance with the provisions of Romanian law. Petrotel-Lukoil subsequently had the product in question classified as heating oil, but this did not bring about a reduction in the tax rate or a refund of the tax overpayment.
            
         
               37.
            
            
               In submitting the second and third questions, which should be considered together, the referring court is thus seeking, in essence, to determine whether the first subparagraph of Article 2(3) of Directive 2003/96, in conjunction with the principle of proportionality, must be interpreted as precluding provisions of national legislation of a Member State or its practice allowing the taxation of an energy product for which the directive does not specify a level of taxation and which is used as heating fuel at the rate applicable for motor fuel if the taxpayer has failed to request a classification for that product for tax purposes, and whether that tax rate can be maintained even after the product in question has been classified as a heating fuel.
            
         
               38.
            
            
               According to the first subparagraph of Article 2(3) of Directive 2003/96, energy products for which the directive does not set tax rates, and which are used as motor or heating fuels, are to be taxed ‘according to use’ at the rate for the equivalent heating fuel or motor fuel.
            
         
               39.
            
            
               Romanian legislation requires, in this situation, that an entity intending to use an energy product as a motor fuel or a heating fuel, where no tax rate has been specified for that product, must request the competent authority to classify the product in question for excise duty purposes. Failure to comply with this obligation results in the automatic taxation of the product at the rate applicable to petrol, if it is used as a motor fuel, or at the rate applicable for diesel fuel, if it is used as a heating fuel. These provisions are aimed at preventing tax evasion, particularly as regards the use of products taxed at rates applicable to heating fuels being used as motor fuels, for which tax rates are much higher.
            
         
               40.
            
            
               The Court has already had the opportunity to determine that similar provisions are contrary to the provisions of Directive 2003/96, interpreted in the light of the principle of proportionality. While Member States may impose certain obligations on taxpayers in order to prevent tax fraud, failure to comply with those obligations must not result in products used as heating fuels being taxed at the rate applicable to motor fuels. (
                     5
                  )
            
         
               41.
            
            
               In my view, the same principle must apply in the present case. The fact that in the ROZ-ŚWIT case there was an information obligation that the seller of energy products was obliged to fulfil after the sale of those products, whereas in the present case there is an obligation that should, in principle, be fulfilled before the products are used, does not change anything. Both these obligations have the same objective, which is to ensure fiscal control over the use of energy products and thus to prevent tax evasion.
            
         
               42.
            
            
               I am therefore not convinced by the Romanian Government’s argument that, unlike the obligation examined by the Court in the abovementioned case, (
                     6
                  ) the obligation laid down in Romanian legislation is not exclusively formal in nature. Irrespective of whether the obligation is ex ante or ex post in nature, the effect of a failure to comply is the same, namely the taxation of an energy product used as heating fuel at the rate applicable for motor fuel. This, according to the case-law of the Court, is contrary to the first subparagraph of Article 2(3) of Directive 2003/96.
            
         
               43.
            
            
               However, with regard to that Government’s argument that such a rate of taxation is intended to be punitive and act as a deterrent, it has to be said that Member States do indeed have the right to impose sanctions on taxpayers who fail to comply with administrative obligations that are imposed on them. Those sanctions cannot, however, involve the taxation of products in a manner that is at variance with the provisions of Directive 2003/96.
            
         
               44.
            
            
               As follows from the foregoing, Member States do not have the right to tax energy products used as heating fuels at the rate that is applicable to motor fuels in situations where taxpayers have not complied with their administrative obligations. A fortiori, they cannot maintain this level of taxation if the taxpayer has complied with those obligations, albeit belatedly. This, however, was the situation in the main proceedings, as Petrotel-Lukoil eventually managed to have the product described as ‘semi-processed heating oil’ classified as heating oil. In such a situation the excess duty paid must be refunded. A failure to refund this tax is incompatible with the provisions of Directive 2003/96, in conjunction with the principle of proportionality.
            
         
               45.
            
            
               I therefore propose that the answer to the second and third questions should be that the first subparagraph of Article 2(3) of Directive 2003/96, in conjunction with the principle of proportionality, must be interpreted as precluding provisions in national law, or national practice, of a Member State permitting the taxation of energy products for which the directive does not specify the level of taxation and which are used as heating fuel at the rate applicable for motor fuel in a situation where the taxpayer has failed to submit a request for the classification of that product for tax purposes, and to maintain that level of taxation even after the product in question has been classified as heating fuel.
            
         
         Conclusion
      
      
               46.
            
            
               In view of all the foregoing considerations, I propose the following answers to the questions referred to the Court by the Curtea de Apel Bucureşti (Bucharest Court of Appeal, Romania):
               
                        (1)
                     
                     
                        Article 21(3) of Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity must be interpreted as precluding provisions of national legislation of a Member State, or an interpretation thereof, that permit taxation of energy products produced within the premises of an establishment producing energy products that are used for the purposes of that production, irrespective of whether that use is made directly or through another product, such as steam or electricity.
                     
                  
                        (2)
                     
                     
                        The first subparagraph of Article 2(3) of Directive 2003/96, in conjunction with the principle of proportionality, must be interpreted as precluding provisions in national law, or national practice, of a Member State permitting the taxation of energy products for which the directive does not specify the level of taxation and which are used as heating fuel at the rate applicable for motor fuel in a situation where the taxpayer has failed to submit a request for the classification of that product for tax purposes, and to maintain that level of taxation even after the product in question has been classified as heating fuel.
                     
                  
         (
            1
         )	Original language: Polish.
      (
            2
         )	OJ 2003 L 283, p. 51.
      (
            3
         )	Council Directive 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 1992 L 76, p. 1).
      (
            4
         )	It does not make any difference in this regard that, in the case of the CHP plant situated within the establishment belonging to Petrotel-Lukoil, there is combined generation (co-generation) of electricity and heat. The exemptions that apply to energy products used in the production of electricity also apply to co-generation (see, by analogy, judgment of 7 March 2018, Cristal Union, C‑31/17, EU:C:2018:168, operative part).
      (
            5
         )	Judgment of 2 June 2016, ROZ-ŚWIT (C‑418/14, EU:C:2016:400, operative part).
      (
            6
         )	Judgment of 2 June 2016, ROZ-ŚWIT (C-418/14, EU:C:2016:400).