CELEX: 61984CC0004
Language: en
Date: 1985-02-14
Title: Opinion of Mr Advocate General Mancini delivered on 14 February 1985. # Johann-Wolfgang-Goethe-Universität v Hauptzollamt Frankfurt am Main - Flughafen. # Reference for a preliminary ruling: Hessisches Finanzgericht - Germany. # Tariff - Exemption for scientific instruments - Equivalent scientific value. # Case 4/84.

OPINION OF MR ADVOCATE GENERAL MANCINI
      delivered on 14 February 1985 (
            *1
         )
      
         Mr President,
      
      
         Members of the Court,
      
      
               1. 
            
            
               The case to which this opinion relates arises from a question referred to this Court for a preliminary ruling by the Hessisches Finanzgericht [Finance Court, Hessen], in an action pending before it between the Johann-Wolfgang-Goethe-Universität, Frankfurt am Main, and the Hauptzollamt [Principal Customs Office] at the local airport. In particular, the national court asks the Court of Justice to rule on the validity of a Commission decision on the importation free of Common Customs Tariff duties of educational, scientific or cultural materials. According to that decision, the conditions necessary for such a benefit to be granted were not fulfilled because apparatus of equivalent value was currently being manufactured in the Community.
            
         
               2. 
            
            
               In March 1980, the Johann-Wolfgang-Goethe-Universität, Frankfurt am Main, imported into the Federal Republic of Germany from the United States an apparatus described as an ‘Nd-YAG laser system DCR-1A with ancillary equipment’, manufactured by the Quanta Ray company, for the purposes of a research project concerning ‘chemiluminescent atomic reactions, deactivating of excited iodine atoms by chemical and physical quenching, formation of excited iodine molecules and monitoring of chemiluminescents’.
               The importer applied to the competent customs office (Frankfurt Airport) for dutyfree admission. Initially, the office granted that application, though on a provisional basis. Later, however, after checks carried out by the Customs Laboratory and Training College, Berlin, it revoked its earlier decision and, by a notice of reassessment dated 27 November 1980, demanded payment from the university of ; some 7500 marks import duty and about 1000 marks turnover tax. The reason it gave for its decision was that apparatus of equivalent scientific value was being manufactured in the Community. That was also stated in Decision 80/291 of 18 February 1980 (Official Journal 1980, L 67, p. 23) in which, in a similar case, the Commission, for the same reason, refused to admit free of customs duty apparatus described as ‘Quanta Ray-DCR laboratory laser system’.
               The importer lodged an objection and, after the Federal Republic had requested it to invoke the procedure provided for in Article 7 of Regulation No 2784/79 of 12 December 1979 (Official Journal 1979, L 318, p. 32), the Commission adopted Decision No 82/83 on 23 December 1981. It is stated in that decision that the apparatus at issue may not be imported free of duties because ‘apparatus of [equivalent] scientific value ... capable of being used for the same purposes... ’, such as the ‘laser à YAG 10 Hz’, manufactured by the French company Quantel, is currently being manufactured in the Community (Official Journal 1982, L 41, p. 50).
               The University appealed to the Hessisches Finanzgericht against the order to that effect adopted by the German customs authorities, claiming that the decision was void. It stated that: (a) the French laser referred to by the group of experts was of a scientific value inferior to that of the corresponding American apparatus and did not permit the proposed research programme to be carried out; (b) it was not apparent from the decision whether apparatus of equivalent value was being produced in the Community when the laser was ordered (19 November 1979). In support of its argument, the plaintiff produced an opinion prepared by Professor H. Walther of the University of Munich which stated that the Quanta Ray laser was suitable for the complex experiments to be carried out under the research programme. Unlike other lasers, including the one manufactured by Quantel, the Quanta Ray laser guaranteed ‘the elimination of all interference effects’.
               By Order of 21 December 1983, the Seventh Senate of the Finanzgericht stayed the proceedings and referred the following question to the Court for a preliminary ruling:
               ‘Is Commission Decision No 82/83/EEC of 23 December 1981 on the “Quanta Ray Nd: YAG laboratory laser system, model DCR-1A” invalid on the ground that, although equivalent apparatus is, as the Commission maintains, manufactured in the Community, the latter is inferior in performance to the imported apparatus, especially having regard to the specific purpose for which it is intended?’
            
         
               3. 
            
            
               The rules according to which the equivalence of scientific instruments is to be assessed are contained in Regulation No 1798/75 of the Council on the importation free of Common Customs Tariff duties of educational, scientific and cultural materials (Official Journal 1975, L 184, p. 1). That regulation was later amended by Council Regulation No 1027/79 (Official Journal 1979, L 134, p. 1) and supplemented by an implementing Regulation, No 2784/79, which was adopted by the Commission on 12 December 1979 and came into force on 1 January 1980 (Official Journal 1979, L 318, p. 32).
               According to the third indent of Article 3 (3) of Regulation No 1798/75 (as amended), equivalent scientific value must be assessed ‘by comparing the essential technical characteristics of the instrument ... in respect of which application is made for [importation free of customs duties]... with those of the corresponding instrument manufactured in the Community in order to determine whether the latter could be used for the same scientific purposes as those for which the instrument... that is the subject of the application for exemption is intended and whether its performance would be comparable’. Article 5 (2) of the implementing regulation provides that ‘In making the comparison... only such technical characteristics as have a decisive influence on the outcome of the specific work planned may be regarded as “essential ”’. On the other hand account is not taken of whether or not the instrument which it is sought to import duty free is capable of achieving ‘performances superior to those which are necessary for [the] proper execution’ of that work.
               The aforementioned Article 3, which has not been amended on this point, also lays down the circumstances in which an instrument is to be regarded as being ‘manufactured in the Community ’. The decisive factor for that purpose is the delivery period from the time of the order, which, account being taken of the commercial practices in the manufacturing sector under consideration, must not exceed the delivery period for the apparatus in respect of which application is made for the exemption to such an extent that the purpose or use for which the apparatus was ‘initially intended’ would be ‘appreciably affected’ thereby.
               Those are the legislative provisions. For its part, the Court has laid down several principles which interpret the rules which I have just described. The most important fixes the limits applicable to judicial review of the validity of the class of measure to which the decision at issue belongs. The Court stated that the technical character of the examination to be carried out by the Committee on Duty-Free Arrangements makes it impossible for the Court to ‘reexamine the question whether in fact the apparatuses concerned are of equivalent scientific value’. Its task is therefore to determine ‘whether the ... decision’ (that is to say, the one adopted by the Commission in conformity with the Committee's opinion) ‘is vitiated by manifest error of fact or law or misuse of power, committed in the implementation of the procedure provided for in Article 7 of Regulation No 2784/79, or with regard to the substance of the case’ (Judgment of 25 October 1984 in Case 185/83 Interfacultair Instituut Electronenmicroscopie der Rijksuniversiteit te Groningen v Inspecteur der Invoerrechten en Accijnzen te Groningen [1984] ECR 3623, paragraph 15; see also Judgment of 27 September 1983 in Case 216/82 Universität Hamburg v Hauptzollamt Hamburg-Kehrwieder[1983] ECR 2771, paragraph 14).
               Another principle laid down by the Court concerns the criteria upon which the Court seeking to determine the equivalence of scientific apparatus must rely. Paragraph 29 of the judgment in Case 185/83 states that that equivalence must ‘not be decided solely on the basis of the technical specifications which the user described in his application as being necessary for his research but primarily on the basis of an objective assessment of their capacity to carry out the experiments for which the user intended to use the imported instruments’.
            
         
               4. 
            
            
               I have already given an account of the facts of the case as they appear from the written procedure. In the course of the hearing however, new factors emerged to which it is useful to refer because of the light they throw on the subject-matter of the dispute and because of the contribution they make, indirect though it may be, to resolution of that dispute.
               In particular, the Commission stated that when the experts drawn from the Member States met for the first time to consider this case they did not succeed in identifying any apparatus manufactured in the Community which was equivalent, as regards scientific value, to the instrument imported by the Goethe University. However, the French representative maintained that it might be possible for the Quantel company to modify a laser already in production to meet the requirements of the research that the importer intended to carry out. The meeting was then adjourned and, at the next meeting, the same expert, who had in the meantime approached Quantel, confirmed the possibility to which he had referred. It was therefore on the basis of his report that the Commission adopted the contested decision and it was also because of that report that the decision refers to the laser of equivalent value not by a specific name (which obviously did not exist, since the instrument in question would have been a modified version) but by the name generally applied to apparatus manufactured by Quantel. At the request of the Court, the Commission produced a statement from Quantel from which it appears that, at the material time, it could have delivered within three to four months after receipt of the order (and therefore within the period laid down in Article 3 of Regulation No 1798/75) a laser possessing the characteristics required by the university.
               The version of the events supplied to the Court in writing by the university is very different. In its opinion, the information contained in Quantel's letter is incorrect. Before the American laser was ordered, the head of the research programme visited the company's headquarters and described to its technical experts both the purposes of the proposed experiment and the characteristics required of the instrument to enable the experiment to be conducted successfully. However, the technical experts never mentioned the possibility of modifying lasers produced by them so as to endow them with those characteristics. Nor, moreover, could they have undertaken to do so. In fact, their lasers, no matter how modified, could never possess one essential characteristic required for conduct of the experiment in question: a repetition rate of 20 Hz per second, which is indispensable in order to obtain the chemiluminescence necessary for spectral analysis. It is that factor, therefore, which distinguishes the American laser from similar instruments manufactured in the Community and which justifies its importation free of customs duties.
            
         
               5. 
            
            
               I am obviously not in a position to express an opinion on whether or not that claim is technically justified, just as I cannot say whether or not the contrary conclusion arrived at by the experts is justified (although the events to which I have just referred give rise to many serious doubts in that connection). According to the case-law of the Court, however, no decision on such a matter is expected of the Court. The Court's task is to decide whether the Commission, when comparing the two lasers, took due account of the characteristic which the Goethe University considered essential for the carrying out of its project; and, if it failed to do so, whether it has adopted an invalid decision.
               I believe that in this case the view that the decision is invalid is inescapable. In particular, it seems to me that the Commission made an error of law in its interpretation of the rules governing dutyfree importation. The Commission states in its observations that those rules must be read in such a way that the customs authorities can apply them easily. That implies that the point of reference for the comparison of apparatus is not the specific project in all its details but the type of project. Otherwise it would be all too easy to present the details of the research project in such a way as to make choice of the imported instrument unavoidable. The Commission states in the summary of its position at page 7 of its observations that ‘a decision regarding duty-free importation must certainly take account... of the circumstances of the particular case, but... it must always be of a general character. That means that the decision must be taken on the basis of general criteria and that it is not possible to study each research project in complete detail’.
               As I have already indicated, I disagree with that argument. In my view, it is contrary both to the very terms of the rules in question, which require an assessment of the particular characteristics of an apparatus in relation to the specific work which is to be carried out, and to the purpose for which those rules were adopted. The purpose of Regulation No 1798/75 is in fact to facilitate the free exchange of ideas as well as the exercise of cultural activities and scientific research within the Community, by allowing ‘by all possible means’ the admission of instruments free of customs duties. It is therefore safe to assume that the legislature did not consider that it was lawful or even proper to make only a summary examination of research projects in order to make customs officers' work easier. On the contrary, everything suggests that the legislature envisaged an extremely thorough examination; this is borne out in particular by the fact that provision was made for consultation of experts within the framework of the Committee on Duty-Free Arrangements in cases where the national authorities consider that they are unable to arrive at a satisfactory decision after consultation with the ‘trade circles concerned’ (Regulation No 2784/79, Article 7 (1) and (2))
               But that is not all. The rules defining the documents which the scientific establishment must furnish in support of its application for importation free of customs duty must be considered. Why ask it to supply all relevant information on the technical characteristics of the instrument being imported, to indicate the name or business name of the Community undertakings which have been approached with a view to obtaining an equivalent instrument, and to set out reasons for which it considers that the latter would not be suitable for the ‘particular research’ to be undertaken? Why require so much detailed information if not for the purpose of permitting the experts to make the comparison by examining the research in detail? Moreover, as this Court has asked, is it not solely by examining the research in detail that it is possible to assess the ‘capacity [of the instruments] to carry out the experiments for which the user intended to use the imported instruments’?
            
         
               6. 
            
            
               It has thus been established that an incorrect interpretation of the rules regarding importation free of customs duties caused the Commission to base its decision as to equivalence not on the specific features of the research but purely on the type of project presented by Goethe University. Consequently, it did not accord the necessary importance to the special characteristic of the imported laser which the university considered essential for the successful conduct of the project.
               It follows that the contested decision is vitiated by an error of law. I therefore propose that the Court reply as follows to the question referred to it by the Seventh Senate of the Hessisches Finanzgericht by Order of 21 December 1983:
               Commission Decision 82/83, adopted on 23 December 1981, to the effect that the apparatus described as ‘Quanta Ray Nd: YAG laboratory laser system, model DCR-1A’ may not be imported free of Common Customs Tariff duties, is invalid.
            
         (
            *1
         )	Translated from the Italian.