CELEX: 62003CC0349
Language: en
Date: 2005-03-10
Title: Opinion of Mr Advocate General Tizzano delivered on 10 March 2005. # Commission of the European Communities v United Kingdom of Great Britain and Northern Ireland. # Failure of a Member State to fulfil obligations - Directive 77/799/EEC - Mutual assistance by the competent authorities - Fields of VAT and excise duties - Partial transposition- Territory of Gibraltar. # Case C-349/03.

OPINION OF ADVOCATE GENERALTIZZANOdelivered on 10 March 2005(1)
         Case C-349/03Commission of the European CommunitiesvUnited Kingdom of Great Britain and Northern Ireland
            (Failure of a Member State to fulfil obligations  –  VAT  –  Excise duties  –  Directive 77/799/EEC  –  Partial transposition for the territory of Gibraltar  –  Legality)
            
      
         
      I –  Introduction
        1.        On 8 August 2003 the Commission of the European Communities brought an action before the Court of Justice under Article 226 EC
      in which it seeks a declaration that, by failing to implement in full Council Directive 77/799/EEC of 19 December 1977 concerning
      mutual assistance by the competent authorities of the Member States in the field of direct and indirect taxation, 
         			(2)
         		 as amended, (‘Directive 77/799’ or, simply, ‘the Directive’) 
         			(3)
         		 in the territory of Gibraltar, the United Kingdom of Great Britain and Northern Ireland has failed to fulfil its obligations
      under the EC Treaty.
      
      
      II –  Legal framework
       A – The relevant provisions of the Treaty
        2.        For the purposes of the present case, it is first of all necessary to have regard to the Treaty articles which, together or
      separately as the case may be, constitute the legal basis of the relevant directives, that is to say, Articles 99 and 100 of
      the EEC Treaty (now, after amendment, Articles 93 EC and 94 EC respectively).
      
      
        3.        The first of those articles (included in the Chapter on ‘Tax Provisions’) provided, in the version in force at the time when
      the directives in question were adopted, that ‘[t]he Commission shall consider how the legislation of the various Member States
      concerning turnover taxes, excise duties and other forms of indirect taxation … can be harmonised in the interest of the common
      market.
       The Commission shall submit proposals to the Council, which shall act unanimously … .’ 4 –At present, by contrast, Article 93 EC provides as follows: ‘[t]he Council shall, acting unanimously on a proposal from
      the Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the
      harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that
      such harmonisation is necessary to ensure the establishment and the functioning of the internal market …’.
      
      
        4.        For its part, Article 100 (included in the Chapter on ‘Approximation of Laws’) provided that ‘[t]he Council shall, acting
      unanimously on a proposal from the Commission, issue directives for the approximation of such provisions laid down by law,
      regulation or administrative action in Member States as directly affect the establishment or functioning of the common market
      …’. 
         			(5)
         		
      
        5.        Finally, it seems to me appropriate also to mention Article 100a, or rather the provision which most recently replaced it,
      namely Article 95 EC, the interpretation of which, although not directly relevant to the present case, may provide useful
      information, as will be seen in what follows. Article 95(1) EC provides that the Council, in this case not unanimously but
      by way of the co-decision procedure, is to ‘adopt the measures for the approximation of the provisions laid down by law, regulation
      or administrative action in Member States which have as their objective the establishment and functioning of the internal
      market’. Article 95(2) EC, however, provides that ‘Paragraph 1 shall not apply to fiscal provisions’.
      
      
       B – Directive 77/799
        6.        Inasmuch as ‘practices of tax evasion and tax avoidance extending across the frontiers of Member States lead to budget losses
      and violations of the principle of fair taxation and are liable to bring about distortions of capital movements and of conditions
      of competition’, 
         			(6)
         		 the Council adopted Directive 77/799 on the basis of Article 100 of the EEC Treaty. Directive 77/799 seeks to strengthen
      ‘collaboration between tax administrations within the Community’ 
         			(7)
         		 by requiring Member States to ‘exchange information concerning particular cases’ and to ‘make the necessary enquiries to
      obtain such information’. 
         			(8)
         		
      
        7.        In particular, Article 1(1) of Directive 77/799, as originally worded, provided that ‘[i]n accordance with the provisions
      of this Directive, the competent authorities of the Member States shall exchange any information that may enable them to effect
      a correct assessment of taxes on income and on capital’.
      
      
        8.        Directive 79/1070, based on Articles 99 and 100 of the EEC Treaty, subsequently amended that provision by including within
      its scope information relating to value added tax (‘VAT’). 
         			(9)
         		 A further extension to cover excise duties on mineral oils, alcohol and alcoholic beverages and manufactured tobacco was
      effected by means of Directive 92/12, which was based on Article 99 of the EEC Treaty. 
         			(10)
         		
      
        9.        Finally, I should point out that the Member States were required to transpose Directive 77/799, in its original version, by
      no later than 1 January 1979. The amendments just referred to were to be introduced by no later than 1 January 1981 and 1 January
      1993 respectively.
      
      
       C – Provisions relating to Gibraltar
        10.      In order to determine whether and how Directive 77/799 was to be transposed in Gibraltar, it is first of all appropriate to
      outline the extent to which Community law applies to that territory.
      
      
        11.      Ceded by the King of Spain to the British Crown under Article X of the Treaty of Utrecht of 1713, Gibraltar has, since 1830,
      had the status of a Crown Colony (British Overseas Territory). As you will be aware, the City is governed by the Gibraltar
      Constitution Order 1969, which defines it in its preamble as ‘part of her Majesty’s dominions’. While there has been a significant
      transfer of powers of self-governance to democratically elected local institutions within Gibraltar, the Crown retains powers
      in matters of foreign affairs, defence and public security.
      
      
        12.      Article 299 EC determines the territorial scope of the Treaty. Article 299(4) EC provides that ‘[t]he provisions of this Treaty
      shall apply to the European territories for whose external relations a Member State is responsible’. It follows that Gibraltar
      is in principle subject to Community law.
      
      
        13.      In view, however, of the special status of Gibraltar, provision is made for derogations from that principle. I am obviously
      referring to Article 28 of the Act concerning the Conditions of Accession and the Adjustments to the Treaties, which forms
      part of the Documents concerning the Accession to the European Communities of the Kingdom of Denmark, Ireland, the Kingdom
      of Norway and the United Kingdom of Great Britain and Northern Ireland (‘the 1972 Act of Accession’ or ‘the Act of Accession’). 
         			(11)
         		
      
        14.      Article 28 of the Act of Accession, as you will know, provides as follows:
      ‘Acts of the institutions of the Community relating to the products in Annex II to the EEC Treaty and the products subject,
      on importation into the Community, to specific rules as a result of the implementation of the common agricultural policy,
      as well as the acts on the harmonisation of legislation of Member States concerning turnover taxes, shall not apply to Gibraltar unless the Council, acting unanimously on a proposal from the Commission, provides otherwise’. 12  –Emphasis added.
      
      
        15.      Furthermore, pursuant to Articles 29 and 30 of the Act of Accession, in conjunction with Annexes I and II thereto, Gibraltar
      does not form part of the Community customs territory and is for that reason treated as a non-member country for purposes
      of the importation and exportation of goods.
      
      
      III –  Facts and procedure
        16.      On 7 April 1997, as it had not received any notification from the United Kingdom with regard to the application of Directive
      77/799 to the territory of Gibraltar, the Commission sent to the United Kingdom Government a letter of formal notice requesting
      information in that regard.
      
      
        17.      By letters of 6 June 1997 and 7 October 1997, the United Kingdom stated that it had adopted the measures necessary to ensure
      that, with effect from 1 October 1997, Directive 77/799 would apply to Gibraltar as regards direct taxation. It submitted,
      however, that no such obligation existed in regard to VAT and excise duties inasmuch as these are indirect taxes.
      
      
        18.      In response to that reply, the Commission sent an additional letter of formal notice dated 18 July 2001 in which it stated
      that, on the contrary, Directive 77/799 had to be applied to Gibraltar also in relation to VAT and excise duties.
      
      
        19.      The United Kingdom challenged that view by letter of 13 November 2001, in which it argued that the Directive did not apply
      to Gibraltar in so far as it involved ‘provisions for the harmonisation of legislation concerning turnover taxes, excise duties
      and other forms of indirect taxation’ within the terms of Article 93 EC, these being provisions which, under Article 28 of
      the Act of Accession, specifically did not apply to Gibraltar.
      
      
        20.      As it took the view, however, that Directive 77/799 did not effect any harmonisation of national tax legislation, the Commission
      maintained its position and accordingly sent a reasoned opinion on 26 June 2002 in which it gave the United Kingdom a period
      of two months within which to adopt the requisite measures.
      
      
        21.      After requesting, by letter of 15 August 2002, an extension of two months to that period, the United Kingdom on 13 September
      2000 submitted its reply, in which it essentially rejected the arguments put forward above.
      
      
        22.      As it remained unconvinced by those arguments, the Commission brought the present action.
      
      
        23.      By order of the President of 4 December 2003, the Court granted leave to the Kingdom of Spain (‘Spain’) to intervene in the
      present case in support of the form of order sought by the Commission, in accordance with Article 93(1) of the Rules of Procedure.
      
      
        24.      As none of the parties applied to make oral submissions, the Court decided, pursuant to Article 44a of the Rules of Procedure,
      to proceed to judgment without any oral part.
      
      
      IV –  Legal analysis
        25.      As already stated, the Commission takes issue with the United Kingdom on the ground that it has applied Directive 77/799 to
      Gibraltar only in regard to direct taxes, whereas it ought to have applied it also in regard to VAT and excise duties.
      
      
        26.      The Commission accepts that, under Article 28 of the Act of Accession, Gibraltar is excluded from application of the ‘acts
      on the harmonisation of legislation of Member States concerning turnover taxes’ and is also prepared to acknowledge, for the
      purposes of the present case, that the Community rules on the harmonisation of excise duties do not concern Gibraltar, which
      does not form part of the customs territory of the Community.
      
      
        27.      According to the Commission, however, the fact remains that the Directive does not bring about any harmonisation of laws on
      turnover tax and excise duties. By contrast, in accordance with the objectives outlined in the recitals in its preamble, it
      seeks only to secure cooperation between Member States in combating tax evasion and tax avoidance, and for that purpose confines
      itself therefore to providing for the introduction of a system for the exchange of information between the competent authorities
      of the Member States.
      
      
        28.      That, the Commission continues, is confirmed by the fact that the system for the exchange of information was originally introduced
      only for direct taxation, which has not been harmonised at Community level. Directives 79/1070 and 92/12 were limited to extending
      the scope of that cooperation to VAT and to excise duties respectively, but did not alter the objective of that system and
      therefore did not affect the substantive tax laws of the Member States. Indeed, even after such amendments, Directive 77/799
      did not have any influence on rates, basis of assessment or the other elements making up national tax systems, or on the systems
      for collection of the taxes and duties in question.
      
      
        29.      Further, the Commission continues, harmonisation of the laws of the Member States on VAT and excise duties constitutes a very
      distinct objective and one which is easily distinguishable from that of the fight against tax evasion and avoidance by way
      of cooperation between the competent national authorities. Consequently, the derogation which Gibraltar enjoys with regard
      to the Community rules designed to pursue the first objective cannot also apply in regard to the rules concerning the second
      objective.
      
      
        30.      Even if, the Commission adds, VAT and excise duties do not concern Gibraltar, the information provided by its tax authorities
      could be extremely useful for the correct determination of those taxes in other parts of the Community. Moreover, in the vast
      majority of cases the information would be flowing in one direction only, that is to say, from Gibraltar to the other regions
      of the Community in which the taxes and duties in question apply. Consequently, even if cooperation were to bring about any
      degree of harmonisation, that would be so only among those to whom that information is addressed, and thus not in Gibraltar.
      
      
        31.      The Commission concludes by stating that, ‘at the limit’, the application to Gibraltar of the system for the exchange of information
      could be justified on the basis of the duty to cooperate laid down in Article 10 EC.
      
      
        32.      In addition to developing arguments similar to those set out by the Commission, the Kingdom of Spain, which has intervened
      in this case, stresses in particular that, in interpreting the derogations provided for Gibraltar, it is necessary to bear
      in mind the fact that the status of that territory was defined at a moment in history at which the economic systems of the
      Member States were subject to a level of integration lower than that which exists at present. Spain goes on to point out that,
      in contrast to the United Kingdom, it has transposed Directive 77/799 in full even in those of its territories to which the
      indirect taxes in question do not apply.
      
      
        33.      The United Kingdom replies to that criticism with arguments which are, in my view, more convincing, as I hope to demonstrate
      in the following analysis.
      
      
        34.      As a preliminary matter, I believe that it is necessary to set aside those arguments which are either non-legal in character
      or do not directly concern the specific matter under examination.
      
      
        35.      For the first aspect, I must point out that this issue touches on the applicability to the territory of Gibraltar of the Community
      rules on VAT and excise duties. This must therefore be examined, as the United Kingdom has correctly pointed out, within its
      specific terms and thus by defining the scope of the derogations provided for by the Act of Accession, without that appraisal
      being in any way influenced by the utility which Member States might derive from the application to Gibraltar of the system
      for the exchange of information introduced by the Directive.
      
      
        36.      On the other hand, I must express serious doubts as to the relevance, for present purposes, of Article 10 EC, even though
      it was mentioned by the Commission. So far as is material for present purposes, that provision states that ‘Member States
      shall take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of
      this Treaty or resulting from action taken by the institutions of the Community. They shall facilitate the achievement of
      the Community’s tasks.’
      
      
        37.      I fail to see how such a provision can play any role in the present case. Only one of two alternatives is possible: either
      the system for the exchange of information which the Directive in issue intended for indirect taxes is not covered by the
      derogations authorised for Gibraltar, with the result that, pursuant to Article 249 EC, read in conjunction with Article 299(4) EC,
      the United Kingdom is under an obligation to transpose the Directive in full within that territory, without there being any
      need to seek additional support from Article 10 EC; or, in the alternative, that system comes within the scope of those derogations,
      with the result that the conditions governing the application of Article 10 EC likewise do not obtain.
      
      
        38.      The first question to be addressed in order to resolve the present case is therefore precisely that of determining whether
      Directive 77/799, in so far as it relates to VAT, is also binding on Gibraltar or whether it falls to be included among ‘the
      acts on the harmonisation of legislation of Member States concerning turnover taxes’, which, pursuant to Article 28 of the
      Act of Accession, do not apply to that territory.
      
      
        39.      It seems to me that a number of arguments militate in favour of the second alternative.
      
      
        40.      First, it must be pointed out that Directive 77/799 was based on the original Article 100 of the EEC Treaty (see point 4 above),
      which allowed for the adoption of ‘directives for the approximation of such [national] provisions … as directly affect the establishment or functioning of the common market’. 
         			(13)
         		 When it subsequently decided to extend to VAT the system for the exchange of information originally provided by Directive
      77/799 only in respect of direct taxation, the Community legislature based the relevant measure (specifically, Directive 79/1070)
      on Article 99 of the EEC Treaty, which at the time provided that ‘[t]he Commission shall consider how the legislation of the
      various Member States concerning turnover taxes, excise duties and other forms of indirect taxation … can be harmonised …’ and was to submit proposals to the Council for that purpose. 
         			(14)
         		
      
        41.      The choice of such legal bases constitutes, in my view, a significant indication that the exchange of information for both
      direct and indirect taxation is a form of harmonisation or approximation of the relevant national legislation.
      
      
        42.      On the other hand, I have to point out, as the United Kingdom has also done, that the exchange of information does not constitute
      an end in itself but is rather an instrument designed to increase the efficiency of the national tax systems and consequently
      their capacity to collect taxes to the extent to which they are in fact outstanding.
      
      
        43.      This seems to me also to be confirmed by the sixth recital in the preamble to Directive 77/799, which states that ‘the Member
      States should exchange … any information which appears relevant for the correct assessment of taxes on income and on capital’, and by the third recital in the preamble to Directive 79/1070, which provides that cooperation
      should be extended to cover indirect taxes ‘in order to ensure that these are correctly assessed and collected’. 
         			(15)
         		
      
        44.      Whether it relates to direct taxes, the constituent elements of which are not the subject of Community legislation, or to
      VAT, the constituent elements of which have, by contrast, been harmonised, 
         			(16)
         		 the introduction of a system for the exchange of information does none the less seem to me to represent an element of harmonisation
      inasmuch as it tends to render uniform, in order to make them more efficient, the rules governing the assessment and collection
      of taxes, whether direct or indirect.
      
      
        45.      On the other hand, the fact that measures which do not impact on the constituent elements of a tax can also be the subject
      of harmonisation measures seems to me to have been confirmed by a recent judgment of the Court in proceedings between the
      Commission and the Council. 
         			(17)
         		
      
        46.      At issue in that case was the choice of the legal basis underlying Council Directive 2001/44/EC of 15 June 2001 amending Directive
      76/308/EEC on mutual assistance for the recovery of claims resulting from operations forming part of the system of financing
      the European Agricultural Guidance and Guarantee Fund, and of agricultural levies and customs duties and in respect of value
      added tax and certain excise duties (‘Directive 2001/44’). 
         			(18)
         		
      
        47.      The Commission took the view in that case that the Council had erred in basing Directive 2001/44 on Articles 93 EC and 94 EC,
      as the correct legal basis, in the Commission’s opinion, was Article 95 EC (see points 3 to 5 above).
      
      
        48.      As has been stated previously, both Article 93 EC and Article 94 EC authorise the Council to adopt, on a unanimous basis,
      measures for the harmonisation of national provisions (the first with reference to ‘legislation concerning turnover taxes,
      excise duties and other forms of indirect taxation’; the second with reference to ‘such laws, regulations or administrative
      provisions of the Member States as directly affect the establishment or functioning of the common market’). Article 95 EC,
      by contrast, introduces, in paragraph 1, the co-decision procedure for the adoption of ‘measures for the approximation of
      the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment
      and functioning of the internal market’. Article 95(2) EC, however, provides that ‘Paragraph 1 shall not apply to fiscal provisions
      …’.
      
      
        49.      In Case C-338/01, the Commission specifically argued, in order to circumvent that derogation, that Directive 2001/44 did not
      relate to ‘fiscal provisions’ inasmuch as, in its view, that notion refers solely to the substantive provisions determining
      taxable persons, taxable events, basis of taxation, rates and exemptions, together with the detailed rules for the assessment
      and enforcement of tax claims. Those matters, however, according to the Commission, were not affected by Directive 2001/44,
      which for that reason did not involve any harmonisation or approximation of the substantive tax laws of the Member States.
      
      
        50.      The Court, in its judgment in that case, rejected the Commission’s line of argument and ruled that the Council had acted correctly
      in choosing Articles 93 EC and 94 EC as the legal basis for Directive 2001/44.
      
      
        51.      In view of the fact that there is nothing in the Treaty to indicate how the concept of ‘fiscal provisions’ is to be construed,
      the Court pointed out that, ‘by reason of their general character, those words cover not only all areas of taxation, without
      drawing any distinction between the types of duties or taxes concerned, but also all aspects of taxation, whether material
      rules or procedural rules’. 
         			(19)
         		
      
        52.      In addition, the Court further specified that ‘the detailed arrangements for the collection of taxes of whatever kind cannot
      be disassociated from the system of taxation or imposition of which they form part’, 
         			(20)
         		 concluding from this that ‘the words “fiscal provisions” contained in Article 95(2) EC must be interpreted as covering not
      only the provisions determining taxable persons, taxable transactions, the basis of imposition, and rates of and exemptions
      from direct and indirect taxes, but also those relating to arrangements for the collection of such taxes’. 
         			(21)
         		
      
        53.      It must therefore be inferred from this that a system of cooperation designed to facilitate the recovery of tax debts which
      have arisen in another Member State can feature among the harmonisation measures of the aforementioned laws specifically referred
      to in Article 95(2) EC. Clearly, the same must also hold true, with regard to the facts of the present case, for the system
      governing the exchange of VAT information envisaged by Directive 77/799.
      
      
        54.      For yet further confirmation of this conclusion, finally, I must also cite Council Regulation (EC) No 1798/2003 of 7 October
      2003 on administrative cooperation in the field of value added tax and repealing Regulation (EEC) No 218/92. 
         			(22)
         		 The third recital in the preamble to that regulation states that ‘tax harmonisation measures taken to complete the internal market should … include the establishment of a common system for
         the exchange of information between the Member States whereby the Member States’ administrative authorities are to assist each other and cooperate with the Commission in order
      to ensure the proper application of VAT on supplies of goods and services …’. 
         			(23)
         		
      
        55.      As the exchange of information thus also represents a form of harmonisation/approximation of the relevant national laws, it
      seems to me that the United Kingdom is right to invoke in this case the derogation provided under Article 28 of the Act of
      Accession (see points 13 and 14 above), once it is clear that the case relates to ‘acts on the harmonisation of legislation
      of Member States concerning turnover taxes’.
      
      
        56.      With regard to the fact that this plea in law was not invoked by the United Kingdom in relation to the exchange of information
      on direct taxation, it strikes me that there is an all too evident explanation for this. The derogation under Article 28 of
      the Act of Accession does not extend to direct taxation and there is therefore no legal basis on which Article 28 can be relied
      on in that regard.
      
      
        57.      In the light of the foregoing, I therefore take the view that the derogation under Article 28 of the Act of Accession allows
      the United Kingdom, so far as VAT is concerned, to refrain from applying to the territory of Gibraltar the system for the
      exchange of information provided for by Directive 77/799.
      
      
        58.      With that matter having been resolved, it remains to be determined whether the same conclusion may be arrived at in regard
      to the exchange of information concerning excise duties.
      
      
        59.      In this regard, it is appropriate to go along with the view, which has been accepted by the Commission itself at least for
      the purposes of the present case, that the harmonised rules on excise duties do not apply to Gibraltar in so far as it does
      not form part of the Community customs territory.
      
      
        60.      The Court has in fact ruled that ‘the exclusion of Gibraltar from the customs territory of the Community implies that neither
      the Treaty rules on free movement of goods nor the rules of secondary Community legislation intended, as regards free circulation
      of goods, to ensure approximation of the laws, regulations and administrative provisions of the Member States pursuant to
      Articles 94 EC and 95 EC are applicable to it’. 
         			(24)
         		
      
        61.      It seems to me that the same considerations must, as the United Kingdom submits, hold true for the Community rules based on
      Article 93 EC (or on Article 99 of the EEC Treaty which preceded it) which seek to harmonise national laws ‘concerning … excise
      duties’ in order to avoid divergent rules in the Member States which might constitute barriers to the free movement of goods.
      
      
        62.      This is precisely the case with regard to Directive 92/12, which, as is clear from the first and fourth recitals in its preamble,
      was adopted in order to render ‘chargeability of excise duties … identical in all the Member States’ in such a way as to ensure
      ‘the establishment and functioning of the internal market’, which require ‘the free movement of goods, including those subject
      to excise duties’.
      
      
        63.      For the purpose of achieving this harmonisation, Directive 92/12, inter alia, broadened the scope of application of the system
      for the exchange of information provided for by Directive 77/799 by extending it to excise duties.
      
      
        64.      On the other hand, I find that, in the same way as has been seen in the foregoing with regard to VAT, in the case of excise
      duties also there is no basis for the distinction which the Commission seeks to draw between, on the one hand, measures which
      harmonise the constituent elements of such indirect taxes – and which therefore do not apply to Gibraltar – and, on the other,
      measures which are limited to providing a system of cooperation between the tax authorities of the Member States – and which,
      it is submitted, are therefore applicable in Gibraltar as being ‘non-harmonising’.
      
      
        65.      In this regard also we may apply, mutatis mutandis, reasoning similar to that applied above in connection with VAT (see point
      40 et seq. above) and thus uphold an interpretation of the concept of ‘harmonisation of legislation concerning … excise duties’
      which includes measures relating to the system for the exchange of information.
      
      
        66.      I can thus conclude on the basis of the foregoing that the United Kingdom was not under an obligation to apply within the
      territory of Gibraltar the system for the exchange of information provided for by Directive 77/799 even in regard to excise
      duties.
      
      
        67.      In the light of the foregoing, I accordingly propose that the action brought by the Commission be dismissed.
      
      
      V –  Costs
        68.      In the light of Article 69(2) of the Rules of Procedure, and in view of the outcome reached to the effect that the action
      should be dismissed, I submit that the Commission should be ordered to pay the costs incurred by the United Kingdom. Spain,
      on the other hand, should bear its own costs, in accordance with Article 69(4) of the Rules of Procedure.
      
       
      VI –  Conclusion
        69.      On the basis of the findings set out above, I propose that the Court should rule as follows:
      ‘(1)   The action is dismissed.
      (2)     The Commission shall pay the costs.
      (3)     The Kingdom of Spain shall bear its own costs.’
      
      
       1 –
         
         Original language: Italian.
      
      2 –
         
         OJ 1977 L 336, p. 15. 
            
         
      
      3 –
         
         Directive 77/799 was amended, in so far as is here relevant, by Council Directive 79/1070/EEC of 6 December 1979 amending
            Directive 77/799/EEC concerning mutual assistance by the competent authorities of the Member States in the field of direct
            taxation (OJ 1979 L 331, p. 8) (‘Directive 79/1070’) and by 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 1992 L 76,
            p. 1) (‘Directive 92/12’).
            
         
      
      4 –
         
         At present, by contrast, Article 93 EC provides as follows: ‘[t]he Council shall, acting unanimously on a proposal from the
            Commission and after consulting the European Parliament and the Economic and Social Committee, adopt provisions for the harmonisation
            of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation
            is necessary to ensure the establishment and the functioning of the internal market …’.
            
         
      
      5 –
         
         The present Article 94 EC has identical wording but also imposes an obligation of prior consultation of the European Parliament
            and the Economic and Social Committee.
            
         
      
      6 –
         
         First recital in the preamble.
            
         
      
      7 –
         
         Fourth recital in the preamble. 
            
         
      
      8 –
         
         Fifth recital in the preamble. 
            
         
      
      9 –
         
         Article 1(2)(a) of Directive 79/1070 (see footnote 3).
            
         
      
      10 –
         
         Article 30(2)(a) of Directive 92/12 (see footnote 3).
            
         
      
      11 –
         
         OJ, English Special Edition of 27 March 1972, p. 14.
            
         
      
      12 –
         
         Emphasis added.
            
         
      
      13 –
         
         Emphasis added.
            
         
      
      14 –
         
         Emphasis added.
            
         
      
      15 –
         
         Emphasis added.
            
         
      
      16 –
         
         See Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover
            taxes – Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1).
            
         
      
      17 –
         
         Judgment of 29 April 2004 in Case C-338/01 [2004] ECR I-0000.
            
         
      
      18 –
         
         OJ 2001 L 175, p. 17.
            
         
      
      19 –
         
         .Commission  v Council, cited above, paragraph 63.
            
         
      
      20 –
         
         .Ibidem, paragraph 66.
            
         
      
      21 –
         
         .Ibidem, paragraph 67.
            
         
      
      22 –
         
         OJ 2003 L 264, p. 1.
            
         
      
      23 –
         
         Emphasis added.
            
         
      
      24 –
         
         Judgment in Case C-30/01 Commission  v United Kingdom [2003] ECR I-9481, paragraph 59.