CELEX: 62018CC0001
Language: en
Date: 2019-01-24 00:00:00
Title: Opinion of Advocate General Wahl delivered on 24 January 2019.#SIA 'Oribalt Rīga v Valsts ieņēmumu dienests.#Request for a preliminary ruling from the Augstākā tiesa.#Reference for a preliminary ruling – Customs union – Regulation (EEC) No 2913/92 – Article 30(2)(b) and (c) – Regulation (EEC) No 2454/93 – Article 152(1)(a) and (b) – Determination of the customs value of the goods – Definition of ‘similar goods’ – Medicinal products – Account taken of any factor that may have an impact on the economic value of the medicinal product concerned – Time limit of 90 days within which the imported goods must be sold in the European Union – Mandatory time limit – No account taken of trade discounts.#Case C-1/18.

OPINION OF ADVOCATE GENERAL
      WAHL
      delivered on 24 January 2019 (
            1
         )
      
         Case C‑1/18
      
      SIA „Oribalt Rīga”, formerly SIA „Oriola Rīga”
      joined party:
      Valsts ieņēmumu dienests
      
         (Request for a preliminary ruling from the Augstākā tiesa (Supreme Court, Latvia))
      
      (Regulation (EEC) No 2913/92 — Community Customs Code — Customs value — Medicines — Article 30(2)(b) — Notion of ‘similar goods’ — Factors to be taken into account — Article 30(2)(c) — Deductive method based on unit price — Time limit of 90 days — Discounts)
      
               1. 
            
            
               In determining the customs value of imported goods, first and foremost the ‘transaction value’ method is used. By dint of that method, the amount of customs duties (as well as import value added tax (VAT)) is determined on the basis of the actual price paid or payable to the seller at the time of export to the European Union.
            
         
               2. 
            
            
               However, that method can only be applied where a sale of the goods in question has already been concluded at the time the customs declaration is made. In other cases, such as a sale on consignment, the transaction value method cannot be used. EU law provides for five other ‘fall back’ methods in such circumstances which are to be used sequentially in the order provided in the relevant legislation. (
                     2
                  )
            
         
               3. 
            
            
               Application of those methods is not always without difficulty. In calculating the customs value, a number of details must be considered. In addition, those details must be applied uniformly throughout the European Union in order to avoid forum shopping by importers.
            
         
               4. 
            
            
               The questions referred for a preliminary ruling by the Augstākā tiesa (Supreme Court, Latvia) in the present case deal with the factors relevant to calculating the customs value in accordance with the alternative methods of customs valuation in Article 30(2) of the Customs Code, in the special context of customs valuation of imported medicines. Given the significant value of medicines, the customs value determined might well, depending on the valuation method used, lead to a significant difference in customs duties or import VAT.
            
         
         I. Legal framework
      
      
         
            A.
          
            The Customs Code
         
      
      
               5.
            
            
               It is the former Community Customs Code and, especially, Chapter 3 thereof (‘Value of Goods for Customs Purposes’), which is applicable to the dispute before the referring court.
            
         
               6.
            
            
               Article 29(1), on the value of goods for customs purposes, states:
               ‘The customs value of imported goods shall be the transaction value, that is, the price actually paid or payable for the goods when sold for export to the customs territory of the [European Union], adjusted, where necessary, in accordance with Articles 32 and 33 …
               …’
            
         
               7.
            
            
               Article 30 further provides:
               ‘1.   Where the customs value cannot be determined under Article 29, it is to be determined by proceeding sequentially through subparagraphs (a), (b), (c) and (d) of paragraph 2 to the first subparagraph under which it can be determined, subject to the proviso that the order of application of subparagraphs (c) and (d) shall be reversed if the declarant so requests; it is only when such value cannot be determined under a particular subparagraph that the provisions of the next subparagraph in a sequence established by virtue of this paragraph can be applied.
               2.   The customs value as determined under this Article shall be:
               
                        (a)
                     
                     
                        the transaction value of identical goods sold for export to the [European Union] and exported at or about the same time as the goods being valued;
                     
                  
                        (b)
                     
                     
                        the transaction value of similar goods sold for export to the [European Union] and exported at or about the same time as the goods being valued;
                     
                  
                        (c)
                     
                     
                        the value based on the unit price at which the imported goods [or] (
                              3
                           ) identical or similar imported goods are sold within the [European Union] in the greatest aggregate quantity to persons not related to the sellers;
                     
                  
                        (d)
                     
                     
                        the computed value, consisting of the sum of:
                        
                                 –
                              
                              
                                 the cost or value of materials and fabrication or other processing employed in producing the imported goods,
                              
                           
                                 –
                              
                              
                                 an amount for profit and general expenses equal to that usually reflected in sales of goods of the same class or kind as the goods being valued which are made by producers in the country of exportation for export to the [European Union],
                              
                           
                                 –
                              
                              
                                 the cost or value of the items referred to in Article 32(1)(e).
                              
                           
                  ...’
            
         
               8.
            
            
               Article 31(1) which contains the sixth and final valuation method states:
               ‘Where the customs value of imported goods cannot be determined under Articles 29 or 30, it shall be determined, on the basis of data available in the [European Union], using reasonable means consistent with the principles and general provisions of:
               …
               
                        –
                     
                     
                        the provisions of this chapter.’
                     
                  
         
         
            B.
          
            The Implementing Regulation
         
      
      
               9.
            
            
               Under Article 142(1)(d) of the Implementing Regulation,‘similar goods’ means ‘goods produced in the same country which, although not alike in all respects, have like characteristics and like component materials which enable them to perform the same functions and to be commercially interchangeable; the quality of the goods, their reputation and the existence of a trademark are among the factors to be considered in determining whether goods are similar’.
            
         
               10.
            
            
               Article 151 further provides:
               ‘1.   In applying Article 30(2)(b) of the [Customs] Code (the transaction value of similar goods), the customs value shall be determined by reference to the transaction value of similar goods in a sale at the same commercial level and in substantially the same quantity as the goods being valued. Where no such sale is found, the transaction value of similar goods sold at a different commercial level and/or in different quantities, adjusted to take account of differences attributable to commercial level and/or to quantity, shall be used, provided that such adjustments can be made on the basis of demonstrated evidence which clearly establishes the reasonableness and accuracy of the adjustment, whether the adjustment leads to an increase or a decrease in the value.
               …
               4.   In applying this Article, a transaction value for goods produced by a different person shall be taken into account only when no transaction value can be found under paragraph 1 for similar goods produced by the same person as the goods being valued.
               …’
            
         
               11.
            
            
               Article 152(1) states:
               
                        ‘(a)
                     
                     
                        If the imported goods or identical or similar imported goods are sold in the [European Union] in the condition as imported, the customs value of imported goods, determined in accordance with Article 30(2)(c) of the [Customs] Code, shall be based on the unit price at which the imported goods or identical or similar imported goods are so sold in the greatest aggregate quantity, at or about the time of the importation of the goods being valued, to persons who are not related to the persons from whom they buy such goods, subject to deductions for the following:
                        
                                 (i)
                              
                              
                                 either the commissions usually paid or agreed to be paid or the additions usually made for profit and general expenses (including the direct and indirect costs of marketing the goods in question) in connection with sales in the [European Union] of imported goods of the same class or kind;
                              
                           
                                 (ii)
                              
                              
                                 the usual costs of transport and insurance and associated costs incurred within the [European Union];
                              
                           
                                 (iii)
                              
                              
                                 the import duties and other charges payable in the [European Union] by reason of the importation or sale of the goods.
                              
                           
                  …
               
                        (b)
                     
                     
                        If neither the imported goods nor identical nor similar imported goods are sold at or about the time of importation of the goods being valued, the customs value of imported goods determined under this Article shall, subject otherwise to the provisions of paragraph 1(a), be based on the unit price at which the imported goods or identical or similar imported goods are sold in the [European Union] in the condition as imported at the earliest date after the importation of the goods being valued but before the expiration of 90 days after such importation.’
                     
                  
         
               12.
            
            
               Article 152(3) further specifies that ‘the unit price at which imported goods are sold in the greatest aggregate quantity is the price at which the greatest number of units is sold in sales to persons who are not related to the persons from whom they buy such goods at the first commercial level after importation at which such sales take place.’
            
         
         II. Facts, procedure and the questions referred
      
      
               13.
            
            
               In 2005, SIA Oribalt Rīga (formerly SIA Oriola Rīga, ‘Oribalt Rīga’) and the Indian company Ranbaxy Laboratories Ltd (‘Ranbaxy Laboratories’) entered into a consignment contract. Under that contract Oribalt Rīga was to provide Ranbaxy Laboratories with consignment services in Latvia, including the provision of storage space for goods and of handling services for processing orders from Ranbaxy Laboratories’ customers in Latvia, Lithuania and Estonia.
            
         
               14.
            
            
               Under the terms of the consignment contract, Oribalt Rīga imported the goods (medicines) into Latvia for free circulation in the internal market. In the course of the customs procedure, Oribalt Rīga stated in the customs documentation that it was both the recipient and the declarant. It calculated the customs value of the imported goods in accordance with the method for determining the transaction value laid down in Article 29(1) of the Customs Code, using pro forma invoices drawn up by Ranbaxy Laboratories for customs purposes and submitted them to the customs authorities. The pro forma invoices indicated the type of imported goods, the item, the unit market price and the total price.
            
         
               15.
            
            
               The imported goods were stored by Oribalt Rīga but ownership did not change until they were sold to customers. Ranbaxy Laboratories determined to whom the imported goods were sold, the terms of sale, the sales price and the discounts applicable. Oribalt Rīga received and processed the orders from Ranbaxy Laboratories’ customers. In that context, Oribalt Rīga completed the invoices using the product sales price provided to it by Ranbaxy Laboratories in an authorised pro forma order.
            
         
               16.
            
            
               The consignment contract stipulated that the goods with the shortest expiry date would be sold first. So several months could elapse between the import and the sale of the goods. Consequently, the sales value of the goods in question at the time of sale could differ from their declared value at the time of import. The actual sales price of the goods was also affected by the discounts which Ranbaxy Laboratories granted to customers.
            
         
               17.
            
            
               Once the goods had been sold, Ranbaxy Laboratories issued Oribalt Rīga with new invoices for the goods sold.
            
         
               18.
            
            
               In 2010 and 2011 the Valsts ieņēmumu dienests (national revenue authority, Latvia, ‘the VID’) carried out customs inspections and other tax inspections in respect of Oribalt Rīga for the period from 2008 to 2010. Thereafter, the VID adopted the decision contested before the referring court, which imposed a supplementary payment on Oribalt Rīga (consisting of VAT, a late payment surcharge and a fine) for goods imported during the inspection period.
            
         
               19.
            
            
               The contested decision stated that the value of the goods at issue had to be determined in accordance with Article 30(2)(c) of the Customs Code, in the light of the information on sales (type of goods, item, unit price and total price) stated in the invoices issued by Ranbaxy Laboratories to Oribalt Rīga following the sale of the goods in question to Ranbaxy Laboratories’ customers. The contested decision also stated that the price to be taken into account had to be the sales price of the goods listed in those invoices, without the discounts given by Ranbaxy Laboratories to its customers.
            
         
               20.
            
            
               The Administratīvā rajona tiesa (District Administrative Court, Latvia) dismissed Oribalt Rīga’s application for annulment of the contested decision. Oribalt Rīga’s appeal against that judgment was in turn dismissed by the Administratīvā apgabaltiesa (Regional Administrative Court, Latvia). Oribalt Rīga thereafter brought another appeal before the referring court.
            
         
               21.
            
            
               Entertaining doubts as to the correct interpretation of the relevant provisions of EU law, the Augstākā tiesa (Supreme Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
               
                        ‘(1)
                     
                     
                        Where the imported goods are medicines, when the customs value of the imported goods is determined in accordance with Article 30(2)(b) of [the Customs Code] and Article 151(4) of [the Implementing Regulation], must it be considered that similar goods are those medicines whose active ingredient and the quantity thereof are the same (or similar) or, rather, in order to identify similar goods, must account be taken of market position as well, that is to say the popularity and demand, of the imported medicine in question and of its producer?
                     
                  
                        (2)
                     
                     
                        When the customs value of the imported goods is determined in accordance with Article 30(2)(c) of [the Customs Code], may the period of 90 days fixed in Article 152(1)(b) of [the Implementing Regulation] be applied flexibly?
                     
                  
                        (3)
                     
                     
                        If that period may be applied flexibly, must priority be given to data on transactions effected closer to the time when the goods to be valued were imported and involving identical or similar goods that are sold in sufficient quantities to enable the unit price to be determined or, on the contrary, to transactions less close in time but actually involving the imported goods?
                     
                  
                        (4)
                     
                     
                        When the customs value of the imported goods is determined in accordance with Article 30(2)(c) of [the Customs Code], have the discounts granted, which determined the price at which the goods were in fact sold, to be applied?’
                     
                  
         
               22.
            
            
               Written observations in the present proceedings have been submitted by Oribalt Rīga, the Latvian Government and the European Commission. All parties presented oral argument at the hearing held on 29 November 2018.
            
         
         III. Analysis
      
      
               23.
            
            
               While at first sight the questions referred by the Augstākā tiesa (Supreme Court) might seem rather technical, they, in fact, touch upon the fundamental principles of customs valuation.
            
         
               24.
            
            
               That is why it will be useful to first provide a short overview of the rationale that underlies customs valuation in the Customs Code. Thereafter, I will address the questions referred in turn.
            
         
         
            A.
          
            Preliminary remarks
         
      
      
               25.
            
            
               At the outset it should be borne in mind that, according to settled case-law, the objective of the EU rules on customs valuation is to introduce a fair, uniform and neutral system excluding the use of arbitrary or fictitious customs values. The customs value thus should, whenever possible, reflect the real economic value of imported goods and take into account all of the elements of such goods that have economic value. (
                     4
                  )
            
         
               26.
            
            
               That principle is manifested in Article 29 of the Customs Code. Article 29 provides for the valuation of imported goods on the basis of their transaction value. The ‘transaction value method’ considers the price actually paid or payable for the goods when sold for export to the customs territory of the European Union.
            
         
               27.
            
            
               In order to reflect the real economic value of the imported goods, certain items are to be added to the transaction value, such as costs associated with packing or transporting the goods to the European Union, any services or materials provided free of charge by the buyer, or royalties and licence fees. (
                     5
                  ) In sales where buyer and seller are related and that relationship might have had an influence on the price of the imported goods, a supplementary payment might be due in order to approximate the customs value to the value of goods of a similar nature, thereby ensuring a fair valuation.
            
         
               28.
            
            
               As the transaction value method reflects the real economic value of the imported goods as closely as is possible, it is the default method for customs valuation. (
                     6
                  ) Nevertheless, Articles 30 and 31 of the Customs Code provide further methods of customs valuation for circumstances where it is not possible to determine the actual transaction value. The four valuation methods in Article 30 thereby constitute ‘secondary tier’ valuation methods which determine the customs value on the basis of clear rules. Article 31, however, provides for a valuation method of last resort, which can only be used if no other option is feasible and which more flexibly applies the regulatory framework on customs valuation.
            
         
               29.
            
            
               Overall, the valuation methods in the Customs Code are set up in a strict hierarchical order and are subordinately linked to each other. Therefore they are to be applied sequentially. It is only when the customs value cannot be determined by applying a given method that it is appropriate to refer to the method which comes immediately after it in the order established by the Customs Code. (
                     7
                  )
            
         
               30.
            
            
               The auxiliary valuation methods in Articles 30 and 31 of the Customs Code thus are used when the actual transaction value either does not exist because the goods to be valued have not been sold yet to a buyer in the European Union or when the authenticity of the transaction value cannot be verified.
            
         
               31.
            
            
               In those circumstances, recourse is had to other methods of valuation with a view to determining a fair customs value reflecting, as far as possible, the real economic value of the imported goods at or about the time of import. The EU legislature realised that, depending on the nature of the goods in question, value might significantly change over time.
            
         
               32.
            
            
               In the case before the referring court, the transaction value method cannot be used as the goods are sold on consignment and ownership changes only after import of the goods into the EU internal market. However, the parties to the main proceedings do not agree as to which one of the alternative valuation methods in Article 30 of the Customs Code is to be used in the concrete case.
            
         
               33.
            
            
               While Oribalt Rīga contends that the imported goods should be valued on the basis of the transaction value of identical or similar goods sold for export to the European Union at or about the same time as the goods being valued, (
                     8
                  ) the VID believes that the goods should be valued on the basis of the unit price at which the imported goods are eventually sold, without however taking into account the discounts granted to Ranbaxy Laboratories’ customers. (
                     9
                  )
            
         
               34.
            
            
               More specifically, it is the implementation of the various valuation methods in Article 30(2) of the Customs Code that leads to contention between the parties. It is thus for the referring court to ultimately determine the method to be used for valuation of the imported goods and how that method is to be applied.
            
         
               35.
            
            
               To that end, the questions referred have been put to the Court, which I will now address in turn.
            
         
         
            B.
          
            The first question referred: factors to be taken into account in determining the customs value of medicines under Article 30(2)(b) of the Customs Code
         
      
      
               36.
            
            
               By its first question, the referring court seeks to know which factors are to be taken into account when choosing appropriate ‘similar goods’ in applying the deductive method of customs valuation laid down in Article 30(2)(b) to medicines.
            
         
               37.
            
            
               That question is of central importance for the case before the referring court as the VID argues that the imported goods could not be valued on the basis of Article 30(2)(b) since the Latvian customs authorities lack the necessary knowledge and information in order to assess whether medicines produced by other sellers are in fact similar to the goods produced by Ranbaxy Laboratories.
            
         
               38.
            
            
               In interpreting Article 30(2)(b) of the Customs Code, guidance is provided by the Implementing Regulation which defines ‘similar goods’ as ‘goods produced in the same country which, although not alike in all respects, have like characteristics and like component materials which enable them to perform the same functions and to be commercially interchangeable; the quality of the goods, their reputation and the existence of a trademark are among the factors to be considered in determining whether goods are similar’. (
                     10
                  )
            
         
               39.
            
            
               As stated by the Commission, it is apparent from that provision that in customs valuation on the basis of a previously established customs value of similar goods, the main considerations to be taken into account are the characteristics and component materials which enable the goods to perform the same functions and to be commercially interchangeable. The quality of the goods, their reputation and the existence of a trademark are further factors to be considered.
            
         
               40.
            
            
               As such, the definition is rather broad and based on a detailed assessment of the goods to be valued so as to allow for a broad application to all types of goods. It is clear from the definition that the factors specifically mentioned as to be considered in the assessment are presented by way of example.
            
         
               41.
            
            
               At the same time, the definition embodies the underlying rationale of customs valuation in the Customs Code, namely to determine a customs value reflecting the real economic value of the imported goods and taking account of all the elements of such goods that have economic value. (
                     11
                  )
            
         
               42.
            
            
               Accordingly, customs authorities are to consider primarily whether the goods compared perform the same functions and whether they are commercially interchangeable. Any further factors to be taken into account for the purposes of the assessment depend on the specific goods to be valued and should take into account all the elements of such goods that may affect their economic value.
            
         
               43.
            
            
               Where a customs authority does not have at its disposal the necessary expertise and information to undertake that assessment with respect to the goods to be valued, several courses of action are possible: (i) the customs authority may request any further documents and information from the declarant as it considers necessary in establishing the customs value under any of the valuation methods in Articles 30 and 31 of the Customs Code; (
                     12
                  ) (ii) the customs authority may request any document or information of any person directly or indirectly involved in the operations concerned for the purposes of trade in goods; (
                     13
                  ) (iii) the customs authority may make a request for administrative assistance from other customs authorities in the EU Member States in order to obtain the necessary information; (
                     14
                  ) or (iv) the customs authority may request analyses or expert reports on the goods to be valued at the expense of the declarant. (
                     15
                  )
            
         
               44.
            
            
               Any confidential information provided in the course of valuation is covered by the duty of professional secrecy and may not be disclosed by the competent authorities without the express permission of the person or authority providing it. (
                     16
                  ) A declarant may thus not rely on the confidential nature of any information requested in order to avoid the obligation to provide that information.
            
         
               45.
            
            
               Customs authorities are to use, where possible, a sale of similar goods at the same commercial level and in substantially the same quantity as the goods being valued. Where no such sale can be found, sales under different conditions may be used. In those circumstances, adjustments are to be made for the factors changed. Importantly, such adjustments can only be made on the basis of demonstrated evidence that clearly establishes the reasonableness and accuracy of the adjustment. In the absence of such an objective measure the determination of a customs value under Article (30)(2)(b) is not appropriate. (
                     17
                  )
            
         
               46.
            
            
               Given the strict hierarchical nature of the provisions on valuation in the Customs Code, the customs authorities are under an obligation to ensure valuation under the provision first mentioned in preference over the methods mentioned thereafter in the Customs Code.
            
         
               47.
            
            
               In addition, the right to good administration, insofar as it constitutes a general principle of EU law, requires that the customs authority states reasons for any of its decisions, including the choice of valuation method. This puts the addressee of such a decision in a position to defend its rights under the best possible conditions and to decide in full knowledge of the circumstances whether it is worthwhile to bring an action against those decisions. It is also necessary in order to enable the courts to review the legality of those decisions. (
                     18
                  )
            
         
               48.
            
            
               In so far as recourse to the valuation method in Article 30(2)(a) of the Customs Code might also be contested between the parties, the same considerations would apply.
            
         
               49.
            
            
               Accordingly, if identical goods (i.e. goods essentially the same but with different serial numbers) were imported by Oribalt Rīga at or about the same time as the goods in question and those goods were valued on the basis of their transaction value in accordance with Article 29 of the Customs Code, the goods in question would necessarily have to be valued on the basis of Article 30(2)(a). If no such identical goods have been imported, then recourse must be had to Article 30(2)(b) and the customs value be determined on the basis of the transaction value of similar goods.
            
         
               50.
            
            
               If recourse is had to the valuation method in Article 30(2)(b) of the Customs Code, I believe that in the case of generic medicines similar goods might not be too difficult to find. As long as there are other generic medicines produced in the same country, that are considered to be an equal substitute for the same brand-name medicinal products as the goods to be valued, and that have been valued on the basis of their transaction value, those other imported medicines constitute similar goods for the purposes of Article 30(2)(b).
            
         
               51.
            
            
               Therefore I propose that the Court answer the first question referred to the effect that where the customs value of imported goods, irrespective of their nature, is determined in accordance with Article 30(2)(b) of the Customs Code and Article 151(4) of the Implementing Regulation, in order to identify similar goods, customs authorities are to consider primarily whether the goods perform the same functions and whether they are commercially interchangeable. To that end, a detailed assessment, depending on the specific nature of the goods in question, is to be undertaken taking into account all the elements of such goods that may affect their economic value.
            
         
         
            C.
          
            The second and third questions referred: the time limit of 90 days in Article 152(1) of the Implementing Regulation
         
      
      
               52.
            
            
               By its second and third questions, the referring court essentially seeks to know whether the time limit of 90 days as a reference period for similar goods, as stated in Article 152(1) of the Implementing Regulation, may be applied flexibly so as to take account of ‘more similar’ goods imported beyond a period of 90 days.
            
         
               53.
            
            
               It is clear from the wording of Article 152(1)(b) of the Implementing Regulation that the period of 90 days represents a strict limit. Otherwise the EU legislature would have inserted a word such as ‘approximately’ into that text. Such an interpretation is based on the underlying principle of customs valuation, namely to determine a customs value that reflects the real economic value of the goods at or about the time the goods valued enter the internal market. The time limit of 90 days mentioned in Article 152(1)(b) is an exception to that principle and must be interpreted narrowly. Thus, 90 days represents the maximum leeway available to customs authorities when valuing goods under Article 30(2)(c) of the Customs Code.
            
         
               54.
            
            
               The VID, in the case before the referring court, has applied the time limit in Article 152(1)(b) flexibly when determining the customs value of the goods imported by Oribalt Rīga under Article 30(2)(c). In that respect, both the referring court and the Latvian Government make reference to the Interpretative Notes in Annex 23 to the Implementing Regulation. In the relevant note, it is suggested that the ‘90 days’ requirement in Article 152(1) could be administered flexibly when customs values are determined under the provisions of Article 31(1) of the Customs Code. The VID thus extended that interpretation to the application of Article 30(2)(c) of the Customs Code.
            
         
               55.
            
            
               Article 31 of the Customs Code is the last provision mentioned in the strict hierarchy of valuation methods in the Customs Code. Therefore, it must be emphasised, valuation of imported goods in accordance with Article 31 denotes a residual method of customs valuation, which is to be used only as a last resort where the customs value of imported goods cannot be determined under Articles 29 or 30.
            
         
               56.
            
            
               In those circumstances, Article 31 allows the valuation methods mentioned in Articles 29 and 30 of the Customs Code to be applied in a flexible manner. However, given the strict hierarchy of the provisions on customs valuation, customs authorities must first establish that valuation on the basis of Articles 29 and 30(2)(a) to (d) is not possible.
            
         
               57.
            
            
               Any other interpretation of the time limit of 90 days in Article 152(1) of the Implementing Regulation would render Article 31 of the Customs Code superfluous and deprive the provision of its effectiveness.
            
         
               58.
            
            
               Consequently, the period of 90 days fixed in Article 152(1) of the Implementing Regulation must be applied strictly.
            
         
               59.
            
            
               I therefore propose that the Court reply to the second and third questions referred to the effect that when the customs value of the imported goods is determined in accordance with Article 30(2)(c) of the Customs Code, the period of 90 days fixed in Article 152(1) of the Implementing Regulation must be applied strictly.
            
         
         
            D.
          
            The fourth question referred: discounts
         
      
      
               60.
            
            
               By the fourth question referred, the national court seeks to know whether the discounts granted, which determined the price at which the imported goods were in fact sold, are to be taken into account when determining the customs value in accordance with Article 30(2)(c) of the Customs Code.
            
         
               61.
            
            
               Article 30(2)(c) provides for the valuation of imported goods on the basis of the unit price (or list price) at which the imported goods or identical or similar imported goods are sold within the European Union in the greatest aggregate quantity to persons not related to the seller.
            
         
               62.
            
            
               Further guidance to that effect is provided by Article 152 of the Implementing Regulation. Accordingly, the unit price of the imported goods or identical or similar goods sold at or about the time of import is to be used as the basis for a valuation under Article 30(2)(c) of the Customs Code. (
                     19
                  ) The provision further specifies that ‘unit price’ refers to the price at which the greatest number of units is sold in sales between unrelated persons at the first commercial level after importation at which such sales take place. (
                     20
                  )
            
         
               63.
            
            
               The valuation method in Article 30(2)(c) differs in important respects from the principal valuation method laid down in Article 29 of the Customs Code.
            
         
               64.
            
            
               Article 29 determines the customs value on the basis of the actual transaction value with adjustments made on the basis of certain elements affecting the real economic value of the imported goods. (
                     21
                  ) As such, discounts can be taken into consideration when determining the customs value in so far as they relate to the imported goods and a valid contractual entitlement to the discount exists at the time the customs declaration is made. (
                     22
                  )
            
         
               65.
            
            
               The valuation methods in Articles 30 and 31, on the other hand, determine a customs value which constitutes an approximation, or rather estimation, of the economic value of the imported goods. (
                     23
                  ) A certain margin of error as compared to the real economic value of the imported goods therefore is inevitable.
            
         
               66.
            
            
               Indeed, the strict hierarchical structure established in Chapter 3 of the Customs Code is evidence that the EU legislature considered certain valuation methods to provide better estimations of the economic value of imported goods than others. Consequently, the further a customs authority has to proceed down the hierarchy of those provisions for determining the customs value, the further removed from the real economic value of the imported goods the customs value potentially might be. (
                     24
                  )
            
         
               67.
            
            
               The customs value determined in accordance with Article 30(2)(c) of the Customs Code is, in that respect, even further removed from the real economic value than it would be under Article 30(2)(a) or (b). Not only does the valuation method in Article 30(2)(c) use an abstract unit price, rather than a concrete commercial transaction, as the basis for its determination. That valuation method also bases the customs value on the unit price in sales at the first commercial level after
                  importation. Articles 29 and 30(2)(a) and (b) in contrast make reference to the transaction value as at the time when the goods are sold for export, in the country of origin, to the customs territory of the European Union.
            
         
               68.
            
            
               In order to nevertheless reduce the margin of error when determining the customs value under Article 30(2)(c), the EU legislature foresaw the need for certain measures in the Customs Code.
            
         
               69.
            
            
               For instance, in order to account for the difference in value that might exist between a sale concluded for export and in a third country, on the one hand, and a sale concluded within the European Union on the other, (
                     25
                  ) the customs value determined in accordance with Article 30(2)(c) is subject to certain deductions.
            
         
               70.
            
            
               Thus deductions for the purposes of the customs value may be made for (i) either the commissions usually paid or agreed to be paid or the additions usually made for profit and general expenses (such as costs of marketing the goods) in connection with sales in the European Union of imported goods of the same class or kind; (ii) usual costs of transport and insurance and associated costs incurred within the European Union; and (iii) the import duties and other charges payable in the European Union by reason of the importation or sale of the goods. (
                     26
                  )
            
         
               71.
            
            
               Those deductions, as is clear from the wording of the provision, constitute a closed list and are not merely indicative. Moreover, it follows from the overall structure of Chapter 3 that the deductions referred to in Article 152(1)(a) aim at levelling out a potential difference in value between goods sold for
                  export and goods sold after importation. Therefore, contrary to what was argued by Oribalt Rīga, the deductions mentioned in Article 152(1)(a) cannot be understood to extend to discounts of a commercial nature, such as those granted to Ranbaxy Laboratories’ customers.
            
         
               72.
            
            
               In addition, by providing that the unit price of goods sold in the greatest aggregate quantity is to be used as the basis for valuation under Article 30(2)(c), that provision already takes into account certain quantity discounts. (
                     27
                  ) If discounts granted to individual customers were taken into consideration in addition to those quantity discounts, the imported goods would in fact be undervalued.
            
         
               73.
            
            
               Lastly, recourse to the alternative methods of valuation is often necessary in circumstances where importers cannot or do not provide the necessary information and documentation to calculate the transaction value. The EU customs authorities have no possibility of compelling third country traders to provide such information. The taking into consideration of discounts only for valuations under Article 29, and where such discounts are demonstrated by the necessary documentation, therefore seems to me a legitimate incentive to provide such information.
            
         
               74.
            
            
               Actually, I believe that when arguing that the customs value determined in accordance with Article 30(2)(c) of the Customs Code should take into account the discounts granted, which determined the price at which the goods were in fact sold, as they constitute an element affecting the real economic value of the imported goods, Oribalt Rīga simply confuses the two different valuation methods in, respectively, Articles 29 and 30(2)(c) of the Customs Code
            
         
               75.
            
            
               Therefore I propose that the Court answer the fourth question referred to the effect that the discounts granted, which determined the price at which the imported goods were in fact sold, cannot be taken into account when the customs value of the imported goods is determined in accordance with Article 30(2)(c) of the Customs Code.
            
         
         IV. Conclusion
      
      
               76.
            
            
               In the light of the foregoing I propose that the Court answer the questions referred by the Augstākā tiesa (Supreme Court, Latvia) as follows:
               Where the customs value of imported goods, irrespective of their nature, is determined in accordance with Article 30(2)(b) of Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code and Article 151(4) of Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Regulation No 2913/92, in order to identify similar goods, customs authorities are to consider primarily whether the goods perform the same functions and whether they are commercially interchangeable. To that end, a detailed assessment, depending on the specific nature of the goods in question, is to be undertaken taking into account all the elements of such goods that may affect their economic value.
               When the customs value of the imported goods is determined in accordance with Article 30(2)(c) of Regulation No 2913/92, the period of 90 days fixed in Article 152(1) of Regulation No 2454/93 must be applied strictly.
               When the customs value of the imported goods is determined in accordance with Article 30(2)(c) of Regulation No 2913/92, the discounts granted, which determined the price at which the imported goods were in fact sold, cannot be taken into account.
            
         (
            1
         )	Original language: English.
      (
            2
         )	In the version applicable to the facts in the main proceedings, Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code (OJ 1992 L 302, p. 1) (‘the Customs Code’).
      (
            3
         )	A comparison with Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Regulation No 2913/92 (OJ 1993 L 253, p. 1) (‘the Implementing Regulation’). and the Interpretative Notes in Annex 23 thereto, as well as other linguistic versions, make it clear that there must be a typographical error in the Customs Code.
      (
            4
         )	See judgment of 20 December 2017, Hamamatsu Photonics Deutschland, C‑529/16, EU:C:2017:984, paragraph 24 and the case-law cited.
      (
            5
         )	See Article 32 of the Customs Code. See also Article 33 of the Customs Code for items not to be included in the customs value.
      (
            6
         )	See judgment of 20 December 2017, Hamamatsu Photonics Deutschland, C‑529/16, EU:C:2017:984, paragraph 26 and the case-law cited.
      (
            7
         )	See judgment of 9 November 2017, LS Customs Services, C‑46/16, EU:C:2017:839, paragraph 43 and the case-law cited.
      (
            8
         )	See Article 30(2)(a) and (b) of the Customs Code.
      (
            9
         )	See Article 30(2)(c) of the Customs Code.
      (
            10
         )	See Article 142(1)(d) of the Implementing Regulation.
      (
            11
         )	Cf. point 25 above.
      (
            12
         )	See Article 178 of the Implementing Regulation as well as the Compendium of Customs Valuation texts of the Customs Code Committee (TAXUD/800/2002-EN) (‘the Customs Compendium’), p. 31.
      (
            13
         )	See Article 14 of the Customs Code.
      (
            14
         )	See Article 4 of Council Regulation (EC) No 515/97 of 13 March 1997 on mutual assistance between the administrative authorities of the Member States and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters (OJ 1997 L 82, p. 1).
      (
            15
         )	Cf. Article 11(2) of the Customs Code.
      (
            16
         )	See Article 15 of the Customs Code.
      (
            17
         )	See Article 151 of the Implementing Regulation and the Interpretative Notes on Customs Value in Annex 23 to the Implementing Regulation.
      (
            18
         )	See Article 6(3) of the Customs Code as well as judgment of 9 November 2017, LS Customs Services, C‑46/16, EU:C:2017:839, paragraphs 39 and 40 and the case-law cited, and judgment of 16 June 2016, EURO 2004. Hungary, C‑291/15, EU:C:2016:455, paragraph 35.
      (
            19
         )	See Article 152(1)(a) of the Implementing Regulation.
      (
            20
         )	See Article 152(3) of the Implementing Regulation.
      (
            21
         )	See Articles 29, 32 and 33 of the Customs Code. See also point 24 above.
      (
            22
         )	See the Customs Compendium, pp. 46 and 47. See also Article 145(2) of the Implementing Regulation and, by analogy, judgments of 20 December 2017, Hamamatsu Photonics Deutschland, C‑529/16, EU:C:2017:984, paragraphs 34 and 35, and of 6 June 1990, Unifert, C‑11/89, EU:C:1990:237, paragraph 35.
      (
            23
         )	See, to that effect, judgment of 28 February 2008, Carboni e derivati, C‑263/06, EU:C:2008:128, paragraph 58.
      (
            24
         )	That is also why even within Article 30(2)(c) there is a hierarchical application of the valuation method. Accordingly, the unit price of the imported goods being valued takes precedence over the unit price of identical or similar imported goods for the purpose of determining the customs value under Article 30(2)(c). Only in circumstances where the unit price of the goods to be valued is not clear or cannot be proven, can the customs authorities sequentially have recourse to the unit price of identical or similar goods. See, to that effect, the Customs Compendium, p. 76.
      (
            25
         )	A difference in value can arise for various reasons, such as the shifting of risks involved in transporting the goods to the European Union or a difference in the market price.
      (
            26
         )	See Article 152(1)(a)(i) to (iii) of the Implementing Regulation.
      (
            27
         )	See the notes on Article 152(3) of the Interpretative Notes in Annex 23 to the Implementing Regulation.