CELEX: 62004CC0023
Language: en
Date: 2005-10-20 00:00:00
Title: Opinion of Mr Advocate General Léger delivered on 20 October 2005.#Sfakianakis AEVE v Elliniko Dimosio.#Reference for a preliminary ruling: Dioikitiko Protodikeio Athinon - Greece.#Association Agreement EEC-Hungary - Obligation of mutual assistance between customs authorities - Post-clearance recovery of import duties following revocation in the State of export of the movement certificates for the imported products.#Joined cases C-23/04 to C-25/04.

OPINION OF ADVOCATE GENERAL
      LÉGER
      delivered on 20 October 2005 1(1)
      
      Joined Cases C‑23/04 to C‑25/04
      Sfakianakis AEVE
      v
      Elliniko Dimosio
      (Reference for a preliminary ruling from the Diikitiko Protodikio Athinon (Greece))
      (EEC-Hungary Association Agreement – Obligation of mutual assistance between customs authorities – Imports of goods under preferential customs arrangements – Subsequent verification of origin of goods calling into question Hungarian origin – Action against findings of the subsequent verification – Customs duties recovered by customs authorities of State of import – Findings of subsequent verification annulled by courts of State of export – Customs authorities of State of import required to take account of decisions of the courts of the State of export)1.        This reference for a preliminary ruling concerns the interpretation of the Europe Agreement establishing an association between
         the European Communities and their Member States, of the one part, and the Republic of Hungary, of the other part, signed
         on 16 December 1991. (2)
      
      2.        It arises from Sfakianakis AEVE’s (3) challenging of decisions taken by the Athens customs office requiring it to pay customs duties on vehicles imported into
         Greece from Hungary. The Hungarian customs authorities had found, following a subsequent verification, that the vehicles’
         certificates of Hungarian origin were inaccurate. Those findings were challenged and annulled in the Hungarian court of competent
         jurisdiction. In execution of the decisions of that court, the Hungarian origin of the vehicles in question was finally confirmed.
      
      3.        The main question referred to the Court by the Diikitiko Protodikio Athinon (Administrative Court of First Instance, Athens)
         is whether the Association Agreement, in particular its rules on administrative cooperation, requires the customs authorities
         of the State of import to take account of decisions given by a court of the State of export confirming the validity of the
         certificates under cover of which the disputed goods were imported.
      
      I –  Legal context
      A –    The Association Agreement and Protocol 4
      4.        The objectives of the Association Agreement, set out in Article 1, include the gradual establishment of a free trade area
         between the Community and Hungary. This was intended to contribute to the integration of the Republic of Hungary into the
         European Community, which was realised on 1 May 2004.
      
      5.        The Association Agreement provides, at Article 9, for the immediate or progressive abolition of all customs duties on imports
         into the European Community of products originating in Hungary.
      
      6.        The concept of ‘originating products’ is defined and the arrangements for administrative cooperation set out in Protocol 4 (4) to the Association Agreement. That protocol was amended by Decision No 1/95, (5) which entered into force on 1 October 1995, and subsequently by Decision No 3/96, (6) which entered into force on 1 July 1997. Since the relevant articles of Protocol 4 as amended by Decision No 3/96 (7) are essentially the same as the corresponding articles in the original 1993 version and in the version amended by Decision
         No 1/95, it is not necessary to identify precisely which version of each article is applicable to the various stages of the
         dispute in the main proceedings. The national court simply refers to the version of the relevant article in Protocol 4 and
         I shall do likewise. 
      
      7.        According to Article 16(1)(a) of Protocol 4, imports into the Community of products originating in Hungary and imports into
         Hungary of products from the different Member States of the Community qualify for the preferential terms of the Association
         Agreement upon submission of a movement certificate EUR.1. (8)Article 17(1) and (5) of Protocol 4 provide that the EUR.1 certificate is to be issued by the customs authorities of the exporting
         country, which must take any steps necessary to verify the origin of the product. They may for that purpose call for any evidence
         and carry out any inspection of the exporter’s accounts or any other check considered appropriate. (9)
      
      8.        The provisions of Protocol 4 in relation to arrangements for administrative cooperation are contained in particular in Articles
         31 to 33, which are the subject of the present reference for a preliminary ruling. They are worded as follows:
      
      ‘Article 31
      Mutual assistance 
      …
      2.      In order to ensure the proper application of this Protocol, the Community and Hungary shall assist each other, through the
         competent customs administrations, in checking the authenticity of the movement certificates EUR.1 or the invoice declarations
         and the correctness of the information given in these documents.
      
      Article 32
      Verification of proofs of origin
      1.      Subsequent verifications of proofs of origin shall be carried out at random or whenever the customs authorities of the importing
         country have reasonable doubts as to the authenticity of such documents, the originating status of the products concerned
         or the fulfilment of the other requirements of this Protocol.
      
      2.      For the purposes of implementing the provisions of paragraph 1, the customs authorities of the importing country shall return
         the movement certificate EUR.1 and the invoice, if it has been submitted, the invoice declaration, or a copy of these documents,
         to the customs authorities of the exporting country giving, where appropriate, the reasons for the enquiry. Any documents
         and information obtained suggesting that the information given on the proof of origin is incorrect shall be forwarded in support
         of the request for verification.
      
      3.      The verification shall be carried out by the customs authorities of the exporting country. For this purpose, they shall have
         the right to call for any evidence and to carry out any inspection of the exporter’s accounts or any other check considered
         appropriate.
      
      4.      If the customs authorities of the importing country decide to suspend the granting of preferential treatment to the products
         concerned while awaiting the results of the verification, release of the products shall be offered to the importer subject
         to any precautionary measures judged necessary.
      
      5.      The customs authorities requesting the verification shall be informed of the results of this verification as soon as possible.
         These results must indicate clearly whether the documents are authentic and whether the products concerned can be considered
         as products originating in the Community [or] Hungary … and fulfil the other requirements of this Protocol.
      
      6.      If in cases of reasonable doubt there is no reply within 10 months of the date of the verification request or if the reply
         does not contain sufficient information to determine the authenticity of the document in question or the real origin of the
         products, the requesting customs authorities shall, except in exceptional circumstances, refuse entitlement to the preferences.
      
      Article 33
      Dispute settlement
      Where disputes arise in relation to the verification procedures of Article 32 which cannot be settled between the customs
         authorities requesting a verification and the customs authorities responsible for carrying out this verification or where
         they raise a question as to the interpretation of this Protocol, they shall be submitted to the Association Committee.
      
      In all cases the settlement of disputes between the importer and the customs authorities of the importing country shall be
         under the legislation of the said country.’ (10)
      
      B –    The Community Customs Code
      9.        The national court also refers to Council Regulation (EEC) No 2913/92 (11) containing the rules and procedures which ensure the implementation of the tariff measures introduced at Community level
         in connection with trade in goods between the Community and third countries. (12)
      
      10.      Article 220(1) of the CCC provides that where the amount of duty resulting from a customs debt has been entered in the accounts
         at a level lower than the amount legally owed, the amount of duty to be recovered or which remains to be recovered is, as
         a rule, to be entered by the customs authorities in the accounting records or on any other equivalent medium (13) within two days of the date on which the customs authorities become aware of the situation and are in a position to calculate
         the amount legally owed and to determine the debtor.
      
      11.      Article 220(2) of the CCC, however, creates an exception in relation to this subsequent entry in the accounts, and the referring
         court seeks an interpretation of that provision also. It provides:
      
      ‘Except in the cases referred to in the second and third subparagraphs of Article 217(1), subsequent entry in the accounts
         shall not occur where: 
      
      …
      (b)      the amount of duty legally owed failed to be entered in the accounts as a result of an error on the part of the customs authorities
         which could not reasonably have been detected by the person liable for payment, the latter for his part having acted in good
         faith and complied with all the provisions laid down by the legislation in force as regards the customs declaration; 
      
      …’
      II –  Facts and procedure in the main proceedings 
      12.      During the years 1996 to 1998, at the request of the European Commission’s Anti-Fraud Coordination Unit (UCLAF), the Hungarian
         customs authorities conducted a subsequent verification of the origin of Suzuki vehicles manufactured in Hungary and imported
         into the European Union between 1995 and 1997 under cover of EUR.1 certificates.
      
      13.      As a result of that investigation, the vehicles imported into Greece by the Sfakianakis company were classified into three
         groups: those confirmed as being of Hungarian origin for the purposes of Protocol 4, those declared to be of foreign origin
         with the manufacturer’s assent, and those the origin of which has given rise to legal proceedings between the exporter and
         the Hungarian customs authorities.
      
      14.      By letter of 3 November 1998, the director of the Hungarian verification body notified these findings to the competent Greek
         customs authorities. In relation to the third group of vehicles, he requested the Greek authorities to defer ex post recovery
         of the customs duties pending the outcome of the legal proceedings.
      
      15.      The competent Greek customs authorities also received a list from UCLAF of vehicles imported into Greece from Hungary which
         were believed to have wrongly benefited from the preferential arrangements. That list included the vehicles the origin of
         which was at issue before the Hungarian courts.
      
      16.      On the basis of that list, the Greek customs authorities adopted decisions requiring Sfakianakis to pay import duties, taxes
         and penalties.
      
      17.      The Hungarian court quashed the findings of the subsequent verification carried out by the Hungarian customs authorities and
         ordered them to repeat the verification procedure in the light of the court’s rulings. (14)
      
      18.      By letter of 26 July 1999 the competent Hungarian authorities notified the Director‑General of the Greek customs authorities
         of those rulings and forwarded to it the list of the vehicles of foreign origin as well and that of the vehicles now confirmed
         as being of Hungarian origin. The Greek customs authorities did not revoke their decisions requiring Sfakianakis to pay import
         duties on the vehicles confirmed as being of Hungarian origin.
      
      III –  The questions referred for a preliminary ruling
      19.      The Diikitiko Protodikio Athinon, hearing the action brought by Sfakianakis against those decisions, decided to stay the proceedings
         and seek a preliminary ruling on the following questions:
      
      ‘1.      Does the obligation of mutual assistance imposed on the customs authorities of the Member State of import by Article 31(2)
         of the Protocol … require them to take into account decisions of the Hungarian courts concerning the validity of the investigations
         carried out by the authorities of the State of export into the correctness of the EUR.1 export certificate in the light of
         the fact that:
      
      (a)      the Hungarian authorities duly informed the customs authorities of the State of import concerning the results of the initial
         investigation which established the inaccuracy of certain export certificates, stressing none the less that the validity of
         the investigation was the subject-matter of proceedings pending before the Hungarian courts and
      
      (b)      the Hungarian authorities officially communicated to the customs authorities of the State of import the outcome of those proceedings,
         that is to say, the decisions of the abovementioned courts, whereby it was found that ultimately a number of the EUR.1 certificates
         were accurate?
      
      2.      Is Article 32 of the Protocol … to be construed as meaning that the customs authorities of the Member State of import are
         required to take into account the decisions of the courts of the State of export overturning the outcome of investigations
         ordered and carried out by the Hungarian authorities after the export operation, regard being had to the fact that:
      
      (a)      the authorities of the State of import were duly informed both of the fact that proceedings were pending before the Hungarian
         courts and of the outcome of the relevant procedures and
      
      (b)      those authorities never asked for any investigation to be carried out?
      3.      If the answer to one of the above questions is affirmative, are the abovementioned provisions of Community law to be construed
         as not permitting the adoption of administrative acts imposing additional duties, taxes and penalties by the national authorities
         of the State of import after notification by the Hungarian authorities of the outcome of the investigation conducted by them
         but before publication of the court decisions overturning the results of the investigation, in order to ensure the effectiveness
         of the prohibition on the imposition of duties under the Association Agreement, in the light also of the fact that ultimately
         the EUR.1 certificates issued were correct?
      
      4.      In that connection are the above questions affected by the fact that neither the Greek nor the Hungarian authorities sought
         convocation of the Association Committee mentioned in Article 33 of the Protocol … for it to rule on the matter, which tends
         to demonstrate that neither of the two authorities considered that the decisions of the Hungarian courts was a matter of dispute
         between them which ought to have been brought before that committee for a decision?
      
      5.      In the alternative, if the answer to the foregoing questions is in the negative, that is to say, if the Greek customs authorities
         did not infringe the abovementioned provisions of Community law by the imposition of additional duty, VAT and a penalty, is
         it then possible to take the view that the ex post determination of duties as against the importer is not permitted under
         Article 220(2) of the Community Customs Code on the ground of error by the customs authorities of the State of import or export,
         regard being had in particular to the fact that the customs authorities of the State of export had available to them all the
         factual elements in connection with the origin of the vehicles for export on the basis of which the EUR.1 certificate ought
         not to have been issued, with the result that the authorities of the State of import would from the beginning have been in
         a position to ascertain the duty lawfully payable?’
      
      IV –  Analysis
      A –    The first two questions
      20.      The first two questions being closely linked, I propose that the Court should examine them together.
      21.      By these questions, the referring court asks, in substance, whether the Association Agreement and Protocol 4, in particular
         the latter’s provisions on the obligation of mutual assistance in Article 31(2) and on verification of proofs of origin in
         Article 32, are to be interpreted as meaning that the customs authorities of the State of import are bound to take heed of
         judicial decisions handed down in the State of export in actions challenging the findings of investigations into the validity
         of movement certificates conducted by the customs authorities of the State of export, if they have been notified of those
         proceedings and of the content of those decisions. The national court also asks the Court whether the fact that the verification
         of the validity of the movement certificates was not carried out at the request of the customs authorities of the State of
         import has any bearing on the answer to be given to that question.
      
      22.      The national court thus wishes to know whether the customs authorities of the State of import have to abide by the initial
         results of the subsequent verification of the validity of the movement certificates performed by the customs authorities of
         the State of export or whether they must also take into account judicial decisions given in the State of export in actions
         brought to challenge the findings of those investigations.
      
      23.      The Greek Government proposes that the answer should be that the Association Agreement and the aforementioned provisions of
         Protocol 4 do not require the customs authorities of the State of import to take into account decisions given by the competent
         national court of the State of export concerning the validity of a subsequent verification of the accuracy of the EUR.1 certificates.
      
      24.      In support of this opinion, the Greek Government points out that determining the origin of the goods is a matter for the customs
         authorities of the State of export and that the applicable Community rules do not require the customs authorities of the State
         of import to review the accuracy of that verification. It submits that a declaration by the customs authorities of the State
         of export that the EUR.1 certificates are incorrect is sufficient to justify the ex post recovery of customs duties.
      
      25.      It argues that, in so far as it is the customs authorities rather than the judicial authorities of the State of export that
         are responsible for subsequent verification of certificates establishing the origin of products and as Article 32(5) of Protocol
         4 provides that such verification must be carried out as soon as possible, it was quite proper for the Hungarian customs authorities
         to cancel the disputed EUR.1 certificates. The Greek Government maintains that nothing in the applicable Community legislation,
         specifically Articles 31 and 32 of Protocol 4, requires the competent customs authorities of the State of import to await
         the outcome of the judicial process.
      
      26.      It adds that, if the assessments made by the customs authorities of the State of export are overturned by a court, the competent
         authorities of the State of import have no way of knowing whether the proceedings were conducted in accordance with natural
         justice and due process, or whether the court’s decision was based on examination of the legal and factual merits of the contested
         act or on a procedural ground, such as failure by the defendant customs authorities to appear in court.
      
      27.      I do not agree with the Greek Government’s position. Like Sfakianakis, the Hungarian Government, and the Commission, I take
         the view that the Association Agreement and the provisions of Protocol 4 relating to mutual assistance and verification of
         proof of origin of goods require the customs authorities of the State of import to take into account judicial decisions given
         in the State of export in an action challenging the findings of an investigation into the validity of EUR.1 certificates.
         Account must be taken of such decisions, the Hungarian Government and the Commission argue, in light of the objective of the
         Association Agreement and the system of administrative cooperation set up by Protocol 4. I also believe, like Sfakianakis,
         that this view is dictated by the need to uphold the fundamental right to an effective remedy before a court or tribunal.
      
      28.      In the first place, as we have seen, it is an object of the Association Agreement that goods meeting the conditions for being
         considered to have originated in Hungary or in a Member State of the European Community may be imported into the Community
         or into Hungary on the preferential terms set out in that agreement. To that end, Articles 16 and 17 of Protocol 4 provide
         that proof of the origin of products, which is the basis for that preferential treatment, is constituted by an EUR.1 certificate,
         which is issued, in accordance with Article 17(4), by the customs authorities of the State of export.
      
      29.      While according to Article 17(4) and (5), this certification of the origin of products by the customs authorities of the State
         of export is based as a rule on checks carried out at the time of issue of the EUR.1 certificate, it also entails subsequent
         verification. As set out in Protocol 4 by Article 32(3), subsequent verification is also carried out by the customs authorities
         of the exporting country who have the right, for this purpose, to call for any evidence and to carry out any checks considered
         appropriate.
      
      30.      It is therefore for the customs authorities of the State of export to verify the origin of the goods in question and to ensure
         that they meet the conditions for preferential treatment under the Association Agreement on being imported into a Member State
         of the Community or into Hungary.
      
      31.      As all of the interveners have pointed out, the system of administrative cooperation contemplated by Articles 31 to 33 of
         Protocol 4 is thus founded both on a division of responsibilities and on mutual trust between the customs services of the
         Member State concerned and those of the Republic of Hungary. As the Court has held in cases concerning other free trade agreements
         and protocols, similar to Protocol 4, which define the concept of ‘originating products’ and prescribe methods of administrative
         cooperation, such a system is justified by the fact that the authorities of the exporting country are in the best position
         to verify directly the facts which determine the origin of the product concerned. (15) It has the further advantage of producing certain and uniform results regarding the identification of the origin of goods
         and of thereby avoiding deflections of trade and distortions of competition in trade. (16)
      
      32.      Such a system can therefore function only if the customs authorities of the importing country accept the determinations legally
         made by the authorities of the exporting country. (17) As the Court held in Les Rapides Savoyards and Others, in the context of international free trade agreements entered into between the Community and a non-member State on the basis
         of reciprocal obligations, recognition by the customs authorities of the Member States of decisions legally made by the authorities
         of that non-member State is also necessary in order that the Community can, in turn, demand that the customs authorities of
         that State accept the decisions taken by the customs authorities of the Member States concerning the origin of products exported
         from the Community to the State in question. (18)
      
      33.      It follows that, under the Association Agreement, the customs authorities of the State of import cannot refuse preferential
         treatment to goods imported under cover of an EUR.1 certificate properly issued by the customs authorities of the State of
         export. If the customs authorities of the State of import have reasonable doubts as to the true origin of the goods in question,
         the only course open to them is to ask the customs authorities of the State of export to carry out a subsequent verification
         of that origin.
      
      34.      The logic of the system of cooperation and division of responsibilities contemplated by that agreement entails that those
         authorities are also bound by the findings of that subsequent verification, where the customs authorities of the State of
         export have been able to determine the origin of the goods in question. It is only in the particular case where the customs
         authorities of the State of export are not in a position duly to carry out the subsequent verification that, according to
         the Court, the customs authorities of the State of import may themselves undertake the verification of the authenticity and
         accuracy of the EUR.1 certificate in question by taking account of other evidence as to the origin of the goods. (19)
      
      35.      The objective of the Association Agreement and the system of administrative cooperation provided for in Protocol 4 therefore
         entail the requirement that the customs authorities of the State of import shall take cognisance of the results of the final
         verification of the origin of the products carried out by the customs authorities of the State of export. That objective dictates
         that all goods that meet the requirements as to origin, and those goods alone, should qualify for preferential treatment on
         import.
      
      36.      It follows that, when the initial results of the subsequent verification are the object of legal proceedings brought by the
         exporter and the customs authorities of the State of import are notified of that action and its outcome, they are bound to
         take cognisance of that outcome.
      
      37.      The provisions of Article 32(5) of Protocol 4, relied upon by the Greek Government, do not seem to me to contradict this view.
         That article provides, it will be recalled, that the customs authorities of the State of import that requested the subsequent
         verification of the origin of the goods concerned must be informed of the results of this verification as soon as possible
         and that those results must indicate clearly whether or not those goods fulfil the requirements laid down in order to qualify
         for the preferential arrangements.
      
      38.      Reference may also be made to Article 32(6) of Protocol 4 which, in the same way as the preceding paragraph, provides that
         if in cases of reasonable doubt as to the origin of the goods concerned there is no reply within 10 months of the date of
         the verification request or if the reply does not contain sufficient information, the requesting customs authorities must,
         except in exceptional circumstances, refuse entitlement to the preferences.
      
      39.      By those provisions, the parties to the Association Agreement intended, I believe, that in return for the power conferred
         on them by Protocol 4, the customs authorities of the State of export requested to perform a verification by the customs authorities
         of the State of import should in fact carry out that verification and forward the results to the authorities of the State
         of import within a reasonable time. The objective is indeed, as the Greek Government points out, to ensure that the administrative
         cooperation procedure, which enables the origin of goods to be established, is implemented promptly and that the fate of the
         goods concerned can be resolved quickly. However, the provisions in question say nothing in relation to legal challenges to
         decisions taken by the customs authorities of the State of export following a subsequent verification, which continue to be
         governed by the legislation of that State.
      
      40.      It cannot therefore be inferred from those provisions that the customs authorities of the State of import are bound by the
         initial conclusions of the subsequent verification where those conclusions are the object of legal proceedings and are consequently
         not definitive.
      
      41.      On the other hand, it can, in my view, be inferred from those same provisions and from the whole scheme of administrative
         cooperation contemplated by Protocol 4 that where a subsequent verification calls into question the validity of EUR.1 certificates
         and those findings are the object of an action in accordance with the rules of domestic law, the customs authorities of the
         State of export must inform the customs authorities of the State of import of those proceedings and, subsequently, of their
         outcome. That obligation is also dictated by the purpose of the Association Agreement, in order that goods the origin of which
         is finally confirmed by the authorities of the State of export do indeed receive the benefit of the preferential treatment
         from the customs authorities of the State of import.
      
      42.      In the light of the purpose of the Association Agreement and of the system of administrative cooperation for determining the
         origin of goods, the customs authorities of the State of import must therefore indeed take account of judicial decisions given
         in actions challenging the initial results of a subsequent verification of that origin.
      
      43.      Contrary to what the Greek Government argues, the customs authorities of the State of import cannot refuse to take cognisance
         of such decisions on the ground that they had no way of knowing whether the proceedings before the courts of the State of
         export were conducted in accordance with natural justice and due process.
      
      44.      It is to be borne in mind that the system of administrative cooperation established by Protocol 4 is founded on mutual trust
         between the customs authorities of the States concerned. That means that, in setting up such a system, the Member States of
         the European Community, as well as the European Parliament, the Council and the Commission, took the view that the administrative
         authorities of the non-member State party to that free trade agreement were capable of implementing the provisions of the
         Association Agreement. That trust must necessarily extend to the courts of the State concerned, which are responsible, in
         accordance with its domestic rules on the administration objective, for adjudicating on actions challenging decisions of its
         customs authorities. It would be paradoxical indeed to accord that trust to the administrative authorities of the non-member
         State but to deny it to its courts, when it is the very function of those courts to ensure that the law, and hence the Association
         Agreement, is observed by the national administrative authorities. (20) As Sfakianakis observed at the hearing, the courts of the State of export are the guarantors of the conformity of the EUR.1
         certificates with the Association Agreement.
      
      45.      The taking account by the customs authorities of the State of import of judicial decisions given in the exporting non-member
         State in actions challenging the findings of a subsequent verification of the origin of goods is therefore inseparable, in
         my view, from the recognition of assessments made by the customs authorities of the State of export concerning such origin
         and is, accordingly, inherent in the division of responsibilities established by Protocol 4.
      
      46.      In addition, the question whether such judicial decisions are taken into account cannot vary from one Member State to another,
         without creating uncertainty of a kind capable of undermining the existence of a common commercial policy and the performance
         by the Community of its obligations under the agreement in question. (21)
      
      47.      In arguing against the taking into account of such decisions, the Greek Government also observes that, when the initial results
         of a subsequent verification are annulled by a court, the customs authorities of the State of import have no way of knowing
         whether that annulment was based on examination of the legal and factual merits of the contested act or on a procedural ground,
         such as failure by the defendant customs authorities to appear in court.
      
      48.      I do not believe that that argument can be upheld. As I have said, the purpose of a subsequent verification is to check the
         accuracy of EUR.1 certificates. (22) When the results of a verification are challenged in accordance with the rules of domestic law, the only relevant issue is
         whether, at the conclusion of the proceedings, the disputed certificates are annulled or confirmed. If the results of a subsequent
         verification calling into question the accuracy of the EUR.1 certificates are annulled in legal proceedings and the certificates
         accordingly affirmed, the customs authorities of the State of import must take those certificates into account, irrespective
         of the grounds on which the findings of the subsequent verification were annulled.
      
      49.      Secondly, the Greek Government’s argument is in any case untenable, in my view, because it is inconsistent with the right
         to an effective judicial remedy.
      
      50.      It is settled case-law that the right to an effective remedy before a court or a tribunal constitutes a general principle
         of Community law which underlies the constitutional traditions common to the Member States. (23) It has been enshrined in Article 47 of the Charter of Fundamental Rights of the European Union, which is based on Articles
         6 and 13 of the Convention for the Protection of Human Rights and Fundamental Freedoms. It is the duty of the Court to ensure
         observance of fundamental rights in the field of Community law. (24) An agreement such as the Association Agreement, concluded by the Council and the Commission pursuant to Article 228 and 238
         of the EC Treaty, (25) forms an integral part of the Community legal system. (26) The Court is therefore bound to ensure that, in the implementation of the Association Agreement, fundamental rights, such
         as the right to an effective judicial remedy, are observed.
      
      51.      It is not in doubt that the decision taken by the customs authorities of the State of export following their subsequent verification
         of the origin of the goods must be amenable to effective judicial review. That review concerns the question whether or not
         the goods at issue meet the requirements laid down in the Association Agreement, which is part of the Community legal system,
         in order for the preferential arrangements to apply. It may result in the exporter being denied the benefits of those arrangements,
         since the importer may be obliged to pay customs duties on the goods, with inevitable consequences for their business relations.
      
      52.      Refusal to take account of the decisions of the State of export’s courts concerning the findings of a subsequent verification
         would therefore have the effect, first, of denying exporters their right under Hungarian law to challenge the results of such
         verifications. A second possible consequence is that the Hungarian customs authorities would likewise decide that they did
         not have to take account of decisions of courts of the Member States in proceedings challenging verifications of origin carried
         out by Member States’ customs authorities. It must be stressed that, according to the principle of reciprocity which underlies
         the Association Agreement and Protocol 4, the taking into account by Member States of Hungarian judicial decisions is also
         the quid pro quo for the Hungarian customs authorities taking account of decisions given by courts of the Member States in
         proceedings brought by exporters to challenge the results of subsequent verifications of the Community origin of goods imported
         into Hungary.
      
      53.      Refusal to take account of decisions given by the Hungarian courts in actions challenging the findings of subsequent verifications
         would therefore be at odds not only with the objective of the Association Agreement and with the system of cooperation contemplated
         by Protocol 4 but also with the right to an effective judicial remedy.
      
      54.      Finally, it also follows from the scheme of Protocol 4 and from the purpose of the Association Agreement that this obligation
         is imposed on the customs authorities of the State of import irrespective of whether or not the subsequent verification took
         place at their request.
      
      55.      It is clear from Article 32(1) of Protocol 4 that subsequent verification can be carried out by the competent authorities
         of the State of export either on their own initiative or at the request of the authorities of the State of import. Such verification
         may also, as in this case, be carried out at the request of the Commission which, under Article 155 of the EC Treaty, (27) has the task of ensuring the proper implementation of the Association Agreement and its protocols. (28)
      
      56.      Whoever it may be who requests the subsequent verification, its purpose is the same, that is to say, to check the accuracy
         of the EUR.1 certificates so that, in accordance with the objective of the Association Agreement, in the case of imports into
         the Community, goods originating in Hungary within the meaning of that agreement should receive the benefit of the preferential
         arrangements it establishes. In the light of that scheme and the purpose of the agreement, the customs authorities of the
         State of import must therefore take account of the results of the subsequent verification and, accordingly, of judicial decisions
         given in the State of export in relation to the results of such verification, irrespective of the authority which initiated
         the verification.
      
      57.      In the light of those considerations, I propose that the Court should reply that the Association Agreement and Protocol 4,
         in particular the latter’s provisions on mutual assistance in Article 31(2) and on verification of proofs of origin in Article
         32, are to be interpreted as meaning that the customs authorities of the State of import are bound to take into account judicial
         decisions handed down in the State of export in actions challenging the findings of investigations into the validity of movement
         certificates conducted by the customs authorities of the State of export, if they have been notified of those proceedings
         and if the content of those decisions, irrespective of whether or not the verification of the validity of the movement certificates
         was carried out at the request of the customs authorities of the State of import.
      
      B –    The third question
      58.      By its third question, the national court asks, in substance, whether the effectiveness of the abolition of customs duties
         provided for by the Association Agreement precludes administrative decisions requiring the payment of customs duties, taxes
         and penalties, adopted by the customs authorities of the Member State of import before the outcome of proceedings challenging
         the findings of a subsequent verification, when the validity of the EUR.1 certificates has been confirmed as a consequence
         of the judicial decisions given in those proceedings.
      
      59.      Examination of this question leads me to consider, first of all, whether the Greek customs authorities, after being notified
         by the Hungarian customs authorities that the EUR.1 certificates concerned were inaccurate, were entitled to take the disputed
         decisions before the outcome of the proceedings challenging the findings of the subsequent verification or whether they ought
         rather to have deferred the recovery process pending the outcome of those proceedings.
      
      60.      Sfakianakis and the Hungarian Government argued at the hearing that the Greek customs authorities ought to have deferred the
         recovery process because, under Hungarian law, bringing an action against administrative decisions suspends the enforcement.
      
      61.      I do not agree with that argument. I do not believe that the issue whether the customs authorities of a Member State are entitled
         to commence recovery of customs duties upon being notified of the results of a subsequent verification casting doubt on the
         origin of the disputed goods can be governed by the law of the non-member State party to the free trade agreement concerned.
         Protocol 4 contains no provision to that effect.
      
      62.      Nor does that protocol lay down any rules respecting the course which the customs authorities of the State of import are to
         follow when, as here, goods imported into the Community under cover of EUR.1 certificates have been placed on the market before
         a subsequent verification calling into question the validity of those certificates. Article 32(4) of Protocol 4 applies only
         to cases where the customs authorities of the State of import have not yet released the products concerned. In the absence
         of any relevant provision in that protocol, it is to the CCC that we must look to discover what the customs authorities of
         the Member State of import must do in circumstances such as those in the case in the main proceedings.
      
      63.      In the light of the provisions of the CCC, I am of the opinion that the Greek customs authorities were not required to defer
         commencement of the recovery process pending the outcome of the legal challenge brought in Hungary against the findings of
         the subsequent verification. It is clear from examination of the relevant provisions that the CCC, while it safeguards the
         rights of the importer in such circumstances, also seeks to protect effectively the financial interests of the Community by
         requiring Member States to undertake the measures necessary to recover the customs debt which is in essence a Community resource.
      
      64.      Article 78(3) of the CCC thus provides that where a post-clearance examination indicates that the provisions governing the
         customs procedure concerned have been applied on the basis of incorrect or incomplete information, the customs authorities
         are to take the measures necessary to regularise the situation, taking account of the new information available to them. It
         follows then from Article 201 of the CCC that a customs debt is incurred through the release for free circulation of goods
         liable to import duties.
      
      65.      Similarly, once a customs debt has been incurred, Member States are required under the CCC to commence the recovery process
         promptly, both as regards the first stage of that process, consisting of entering the debt in the accounts, (29) and as regards its actual recovery from the debtor. (30) Finally, according to Article 244 of the CCC, the lodging of an appeal against decisions taken by the customs authorities
         of the Member States does not, subject to exceptions, cause implementation of the disputed decision to be suspended.
      
      66.      I do not believe that when a customs debt is incurred, as in this case, as a result of the invalidation of EUR.1 certificates
         following a subsequent verification, the fact that there is a pending action challenging that invalidation obliges the customs
         authorities of the Member State of import to defer commencement of the procedure described above. Since the goods at issue
         have already been placed on the market in the Community and the court proceedings could last several years, such deferment
         could seriously jeopardise recovery of the customs debt if the action should be rejected.
      
      67.      Moreover, the interests of an importer whose EUR.1 certificates are invalidated post-clearance are taken into account at both
         stages of the recovery procedure. Thus, under Article 220 of the CCC, the importer may be exempted from ex post payment of
         the debt if preferential status was applied as a result of an error on the part of the customs authorities of the State of
         export which could not have been detected by the person liable for payment acting in good faith and in compliance with the
         legislation in force. (31) Next, if the debt has been entered in the accounts, the debtor may be granted an extension of time for payment, a deferment,
         or payment facilities, subject to conditions laid down in the CCC, while customs duties must of course be repaid if they should
         prove not to have been lawfully due.
      
      68.      Finally, with regard to the action – normally non-suspensory – that this importer is entitled to bring in the Member State
         of import against the decision of the customs authorities of that State requiring the payment of customs duties, Article 244
         of the CCC provides that the customs authorities must suspend implementation of such decision in whole or in part where they
         have good reason to believe that the disputed decision is inconsistent with customs legislation or that irreparable damage
         is to be feared for the person concerned. A debtor so obtaining a suspension of payment of customs duties may also be relieved
         of the requirement to provide security where that would be likely to cause the debtor serious economic or social difficulties.
      
      69.      My view seems to be borne out also by the case-law, in relation to actions brought by importers against Commission decisions
         on the repayment or remission of import duties, pursuant to Article 13 of Council Regulation (EEC) No 1430/79, (32) according to which the sole aim of Article 13 of Regulation No 1430/79 is to enable importers, when certain special conditions
         are satisfied and in the absence of negligence or deception, to be exempted from payment of duties due from them and not to
         enable them to contest the actual principle of a customs debt’s being due. (33) In Cerealmangimi and Italgrani  v Commission, the Court explained, in this regard, that the applicants ought to have referred the decision of the customs authorities
         of the Member State of import requesting payment of the debt to the courts of the State in question. (34) That case-law confirms the view that initiation of the recovery procedure is not subject to the condition that it should
         have become unarguable that the customs debt has come into existence.
      
      70.      It follows that, in the present case, the Greek customs authorities, once notified by the Hungarian customs authorities that
         the subsequent verification of the EUR.1 certificates had resulted in a finding that some of them were inaccurate, were quite
         entitled, indeed bound, to initiate the procedure for recovery of the customs duties on the vehicles imported under cover
         of those certificates, even though the findings of the verification were the subject of an appeal in accordance with the rules
         of domestic law. (35)
      
      71.      It must now be asked what is to become of the decisions of the Greek customs authorities, at issue in the main proceedings,
         in relation to the vehicles whose EUR.1 certificates were ultimately confirmed in accordance with the decisions rendered by
         the Hungarian court.
      
      72.      The answer to this question follows directly from the answer that I have proposed should be given to the previous questions.
         As we have seen, the purpose of the Association Agreement is that goods meeting the requirements to be considered as having
         originated in Hungary should be imported into the Community under the preferential arrangements set out in that agreement.
         The effectiveness of the Association Agreement would thus be compromised if such goods, the Hungarian origin of which had
         been finally confirmed in pursuance of decisions rendered by the competent court of the State of export, were to be denied
         the benefit of the preferential treatment. In such a case, it is, therefore, contrary to that principle of effectiveness for
         the customs authorities of the State of import to carry out ex post recovery of customs duties, taxes and penalties.
      
      73.      Likewise, it would manifestly be a breach of the right to an effective judicial remedy if, after the exporter had secured
         a judgment annulling the findings of the subsequent verification calling into question the validity of the EUR.1 certificates,
         the customs authorities of the State of import were none the less to proceed to recover the customs duties from the importer
         on the basis of those findings.
      
      74.      It follows that, in the circumstances of the present case, the Greek customs authorities ought to annul or withdraw the contested
         administrative decisions in so far as they concern those vehicles the Hungarian origin of which was finally confirmed.
      
      75.      I therefore propose that the answer to be given to the third question is that the effectiveness of the abolition of customs
         duties provided for by the Association Agreement militates against administrative decisions requiring the payment of customs
         duties, taxes and penalties, taken by the customs authorities of the Member State of import before the outcome of proceedings
         challenging the findings of a subsequent verification, when the validity of the EUR.1 certificates has been confirmed pursuant
         to the judicial decisions given in those proceedings. 
      
      C –    The fourth question
      76.      The national court asks whether the answers to the previous questions may be affected by the fact that neither the Greek customs
         authorities nor the Hungarian customs authorities requested the convening of the Association Committee referred to in Article
         33 of Protocol 4. 
      
      77.      I propose that the Court should construe this question to the effect that the national court asks whether the answers given
         to the previous questions can be affected by the fact that neither the Greek customs authorities nor the Hungarian customs
         authorities took the matter to the Association Committee following the decision given by the Hungarian courts.
      
      78.      It is my view that this question must be answered in the negative for the following reasons.
      79.      We have seen that the customs authorities of the State of import may not unilaterally declare invalid an EUR.1 certificate
         that has been properly issued by the customs authorities of the State of export. If there are reasonable doubts as to the
         accuracy of the certificate, their only course is to ask those authorities to carry out a subsequent verification. Likewise,
         they are bound by the findings of that verification if the customs authorities of the State of export have been able to determine
         the origin of the goods in question.
      
      80.      Under Article 33 of Protocol 4, if the customs authorities of the State of import have a disagreement with the customs authorities
         of the State of export in relation to the verification they must endeavour to reach an amicable settlement with them. If such
         a settlement cannot be reached, they must then submit their dispute to the Association Committee.
      
      81.      It follows that the fact that neither the Greek customs authorities nor the Hungarian customs authorities brought the matter
         before the Association Committee cannot disturb the conclusion that the Greek customs authorities must take account of the
         Hungarian judicial decisions and that, those decisions having confirmed the Hungarian origin of the vehicles at issue, the
         Greek customs authorities may not recover customs duties in relation to those vehicles.
      
      82.      I propose to reply to the national court that the answers to the previous questions are not affected by the fact that neither
         the Greek customs authorities nor the Hungarian customs authorities requested the convening of the Association Committee referred
         to in Article 33 of Protocol 4.
      
      D –    The fifth question 
      83.      The national court’s fifth question is asked only if a negative answer should be given to the first two questions considered
         above. In so far as I have proposed that they should be answered in the affirmative, it is not necessary to consider this
         final question.
      
      V –  Conclusion
      84.      In the light of the foregoing considerations, I propose that the Court should answer the questions referred by the Diikitiko
         Protodikio Athinon in the following terms:
      
      (1)      The Europe Agreement establishing an association between the European Communities and their Member States, of the one part,
         and the Republic of Hungary, of the other part, and in particular the obligation of mutual assistance laid down in Article
         31(2) of Protocol 4 concerning the definition of the concept of ‘originating products’ and methods of administrative cooperation,
         annexed to the Association Agreement, as amended by Decision No 3/96 of the Association Council, Association between the European
         Communities and their Member States, of the one part, and the Republic of Hungary, of the other part, of 28 December 1996
         amending Protocol 4, as well as the provisions of Article 32 of that protocol concerning verification of proofs of origin
         of goods, are to be interpreted as meaning that the customs authorities of the State of export are bound to take into account
         judicial decisions handed down in the State of export in actions challenging the findings of investigations into the validity
         of movement certificates conducted by the customs authorities of the State of export, if they have been notified of those
         proceedings and of the content of those decisions, irrespective of whether or not the verification of the validity of the
         movement certificates was carried out at the request of the customs authorities of the State of import.
      
      (2)      The effectiveness of the abolition of customs duties provided for by the Association Agreement militates against administrative
         decisions requiring the payment of customs duties, taxes and penalties, taken by the customs authorities of the Member State
         of import before the outcome of proceedings challenging the findings of a subsequent verification, when the validity of the
         EUR.1 certificates has been confirmed pursuant to the judicial decisions given in those proceedings.
      
      (3)      The answers to the previous questions are not affected by the fact that neither the Greek customs authorities nor the Hungarian
         customs authorities requested the convening of the Association Committee referred to in Article 33 of Protocol 4, as amended
         by Decision No 3/96.
      
      1 –	Original language: French.
      
      2 –	OJ 1993 L 347, p. 2; ‘the Association Agreement’. That agreement, together with its protocols, was adopted on behalf of
         the Community by Decision 93/742/Euratom, ECSC, EC of the Council and the Commission of 13 December 1993 (OJ 1993 L 347, p. 1).
      
      3 –	‘Sfakianakis’.
      
      4 –	Protocol concerning the definition of the concept of ‘originating products’ and methods of administrative cooperation (OJ
         1993 L 347, p. 177).
      
      5 –	Decision of 17 July 1995 amending Protocol 4 to the Association Agreement (OJ 1995 L 201, p. 39).
      
      6 –	Decision of 28 December 1996 amending Protocol 4 to the Association Agreement (OJ 1997 L 92, p. 1).
      
      7 –	‘Protocol 4’.
      
      8 –	‘The EUR.1 certificate’.
      
      9 –	Articles 16 and 17 of Protocol 4 are essentially the same as Articles 10 and 11 of the original 1993 version and Articles
         11 and 12 of the version amended by Decision No 1/95.
      
      10 –      These provisions, apart from the additions to Article 32(3) of Protocol 4, were already contained, in substance, and in a
         different order, in Article 27 of the original 1993 version and Article 28 of the version as amended by Decision No 1/95.
      
      11 –	Regulation of 12 October 1992 establishing the Community Customs Code (OJ 1992 L 302, p. 1; ‘the CCC’).
      
      12 –	See third recital in the preamble to the CCC.
      
      13 –	See first subparagraph of Article 217(1) of the CCC.
      
      14 –	According to Sfakianakis, the Hungarian court held that, in determining whether or not the value of non-originating parts
         used in the manufacture of the vehicle exceeded the ceiling of 40% of the ex-works price of the product, above which the vehicle
         can no longer be regarded as an originating product within the meaning of the Association Agreement, account must be taken
         of discounts to the market price secured by the exporter when purchasing those parts in Japan.
      
      15 –	Case 218/83 Les Rapides Savoyards and Others [1984] ECR 3105, paragraph 26, concerning the Agreement on free trade between the European Economic Community and the Swiss
         Confederation, signed on 22 July 1972; Case C-12/92 Huygenand Others [1993] ECR I-6381, paragraphs 24 and 25, concerning the Agreement on free trade between the European Economic Community and
         the Republic of Austria, signed on 22 July 1972; and Case C-432/92 Anastasiou and Others [1994] ECR I-3087, paragraph 38, concerning the Agreement of 19 December 1972 establishing an association between the European
         Economic Community and the Republic of Cyprus.
      
      16 –	Les Rapides Savoyards and Others, paragraph 26.
      
      17 –	Les Rapides Savoyards and Others, paragraph 27, and Huygen and Others, paragraph 25; also Joined Cases C-153/94 and C-204/94 Faroe Seafood and Others [1996] ECR I-2465, paragraph 20, and Case C-97/95 Pascoal & Filhos [1997] ECR I‑4209, paragraph 33.
      
      18 –	Ibid., paragraph 27.
      
      19 –	See Huygen and Others, paragraph 27. It must be noted here, however, that this obligation to recognise decisions taken by the authorities of the
         non-member State does not apply in the same way when the preferential system is established by a unilateral Community measure,
         such as a regulation. The Court has held that, in such circumstances, the authorities of the non-member State cannot bind
         the Community and its Member States in their interpretation of the Community legislation, so that determinations made by the
         Commission as to the origin of goods in the light of a mission of enquiry must take precedence over the determinations of
         the customs authorities of the exporting non-member State (see Faroe Seafood and Others, paragraphs 24 and 25, in relation to Council Regulation (EEC) No 2051/74 of 1 August 1974 on the customs procedure applicable
         to certain products originating in and coming from the Faroe Islands (OJ 1974 L 212, p. 33), and Commission Regulation (EEC)
         No 3184/74 of 6 December 1974 concerning the definition of the concept of ‘originating products’ and methods of administrative
         cooperation for the application of the customs procedure applicable to certain products originating in and coming from the
         Faroe Islands (OJ 1974 L 344, p. 1)). That may also be the case, in the context of an international free trade agreement binding
         the Community to a non-member State, where the non-member State has failed to take the measures necessary for the implementation
         of the agreement and where a subsequent verification by the Commission services reveals that the movement certificates issued
         by the customs authorities of that State were inaccurate (Case C-251/00 Ilumitrónica [2002] ECR I‑10433, paragraph 74), in relation to the importation into the Community of television sets from Turkey under
         the preferential arrangements provided for by the Agreement establishing an association between the European Economic Community
         and Turkey signed at Ankara on 12 September 1963 by the Republic of Turkey, of the one part, and the Member States of the
         EEC and the Community, of the other part, approved on behalf of the Community by Council Decision 64/732/EEC of 23 December
         1963 (JO 1964 217, p. 3685; English version published in OJ 1973 C 113, p. 1).
      
      20 –	That trust in the judicial authorities of the other party to the Association Agreement finds explicit expression, moreover,
         in Article 113 of that agreement, according to which ‘[w]ithin the scope of [the agreement], each Party undertakes to ensure
         that natural and legal persons of the other Party have access free of discrimination in relation to its own nationals to the
         competent courts and administrative organs of the Community and Hungary to defend their individual rights …’.
      
      21 –	See, to this effect, Anastasiou and Others, paragraph 53, on the issue of the acceptance, for the purposes of imports of goods from Cyprus into the Community, of movement
         certificates issued by authorities other than the competent authorities of the Republic of Cyprus.
      
      22 –	Huygen and Others, paragraph 26.
      
      23 –	Case 222/84 Johnston [1986] ECR 1651, paragraph 18; Case 222/86 Heylens and Others [1987] ECR 4097, paragraph 14; Case C-97/91 Oleificio Borelli  v Commission [1992] ECR I-6313, paragraph 14; and Case C-467/01 Eribrand [2003] ECR I‑6471, paragraph 53.
      
      24 –	Case 12/86 Demirel [1987] ECR 3719, paragraph 28.
      
      25 –	Now, after amendment, Articles 300 EC and 310 EC.
      
      26 –	Demirel, paragraph 7.
      
      27 –	Now Article 211 EC.
      
      28 –	See, to this effect, Ilumitrónica, paragraph 60.
      
      29 –	See Articles 217 to 220 of the CCC.
      
      30 –	See Articles 221 to 232 of the CCC.
      
      31 –	Article 220(2) of the CCC, as amended by Regulation (EC) No 2700/2000 of the European Parliament and of the Council of
         16 November 2000 amending Council Regulation (EEC) No 2913/92 establishing the Community Customs Code (OJ 2000 L 311, p. 17),
         provides, in this regard, at (b), second and third subparagraphs, that where the preferential status of the goods is established
         on the basis of a system of administrative cooperation involving the authorities of a third country, the issue of a certificate
         by those authorities, should it prove to be incorrect, shall constitute an error which could not reasonably have been detected
         within the meaning of the first subparagraph; the issue of an incorrect certificate shall not, however, constitute an error
         where the certificate is based on an incorrect account of the facts provided by the exporter, except where, in particular,
         it is evident that the issuing authorities were aware or should have been aware that the goods did not satisfy the conditions
         laid down for entitlement to the preferential treatment In her Opinion in Case C-293/04 Beemsterboer Coldstore Services, currently pending before the Court, Advocate General Kokott states that this new version of Article 220 of the CCC constitutes
         a clarification only and not an amendment (point 30).
      
      32 –	Council Regulation (EEC) No 1430/79 of 2 July 1979 on the repayment or remission of import or export duties (OJ 1979 L 175,
         p. 1). Article 13(1) of  Regulation No 1430/79 was carried over in almost identical terms to Article 239(1) of the CCC, which
         provides that:
      
      	‘[i]mport duties or export duties may be … remitted in situations … resulting from circumstances in which no deception or
         obvious negligence may be attributed to the person concerned (…)’.
      
      33 –	Joined Cases 244 and 245/85 Cerealmangimi and Italgrani v Commission [1987] ECR 1303, paragraph 11, and Joined Cases C-121/91 and C-122/91 CT Control (Rotterdam) and JCT Benelux v Commission [1993] I‑3873, paragraph 43.
      
      34 –	Paragraph 12.
      
      35 –	The fact that, in the instant case, the Greek customs authorities did not initiate the procedure until after receiving
         the UCLAF list of vehicles wrongly given preferential treatment does not call into question the validity of the procedure,
         since the vehicles in question were the same as those in respect of which the EUR.1 certificates were declared invalid by
         the Hungarian customs authorities, there being no difference between the findings of the Hungarian customs authorities and
         those of the Commission in this matter.