Cristal Union, the legal successor to Sucrerie de Toury SA v Ministre de l'Économie et des Finances.
Date: 2018-03-07
21


According to settled case-law, provisions concerning exemptions provided for by Directive 2003/96 must be given an autonomous interpretation, based on their wording and the scheme of that directive and the objectives pursued by the latter (see, to that effect, judgments of 3 April 2014, Kronos Titan and Rhein-Ruhr Beschichtungs-Service, C‑43/13 and C‑44/13, EU:C:2014:216, paragraph 25, and of 13 July 2017, Vakarų Baltijos laivų statykla, C‑151/16, EU:C:2017:537, paragraph 24 and the case-law cited).
24


Second, it should be recalled that the general scheme of Directive 2003/96 does not, it is true, seek to establish general exemptions (see, to that effect, judgments of 1 December 2011, Systeme Helmholz, C‑79/10, EU:C:2011:797, paragraph 23, and of 21 December 2011, Haltergemeinschaft, C‑250/10, not published, EU:C:2011:862, paragraph 19).
25


In addition, since Article 14(1) of Directive 2003/96 sets out an exhaustive list of the exemptions which Member States must apply in connection with the taxation of energy products and electricity (see judgments of 5 July 2007, Fendt Italiana, C‑145/06 and C‑146/06, EU:C:2007:411, paragraph 36, and of 4 June 2015, Kernkraftwerke Lippe-Ems, C‑5/14, EU:C:2015:354, paragraph 45), its provisions cannot be interpreted broadly without depriving the harmonised taxation established by that directive of all practical effect.
26


However, as the Court has already held, the first sentence of Article 14(1)(a) of Directive 2003/96, in so far as it imposes on Member States the compulsory exemption of energy products used to generate electricity, provides a precise and unconditional obligation, with the result that it confers on individuals the right to rely directly on it before national courts (see, to that effect, judgment of 17 July 2008, Flughafen Köln/Bonn, C‑226/07, EU:C:2008:429, paragraphs 29 to 33).
27


In addition, it should be noted that, when the EU legislature intended to allow Member States to derogate from that regime of mandatory exemption, it did so explicitly in, respectively, the second sentence of Article 14(1)(a) of Directive 2003/96, which states that Member States may tax energy products used to produce electricity for reasons relating to the protection of the environment, and in the third subparagraph of Article 21(5) of that directive, under which Member States which exempt electricity generated by small producers of electricity must tax the energy products used for the generation of that electricity.
28


It is thus apparent from the general scheme of Directive 2003/96 that, apart from those two specific cases, the compulsory exemption of energy products used to generate electricity referred to in the first sentence of Article 14(1)(a) of that directive is unconditionally binding on Member States.
29


Thirdly, as regards the objectives pursued by Directive 2003/96, it must be observed, first of all, that that directive, by making provision for a system of harmonised taxation of energy products and electricity, seeks, as is apparent from recitals 2 to 5 and 24 thereof, to promote the smooth functioning of the internal market in the energy sector by avoiding, in particular, distortions of competition (see, to that effect, inter alia, judgments of 3 April 2014, Kronos Titan and Rhein-Ruhr Beschichtungs-Service, C‑43/13 and C‑44/13, EU:C:2014:216, paragraphs 31 and 33; of 2 June 2016, ROZ-ŚWIT, C‑418/14, EU:C:2016:400, paragraph 32; and of 7 September 2017, Hüttenwerke Krupp Mannesmann, C‑465/15, EU:C:2017:640, paragraph 26).
30


To that end, with regard to electricity generation, the EU legislature made the choice, as is apparent, in particular, from page 5 of the explanatory memorandum to the proposal for a Council Directive restructuring the Community framework for the taxation of energy products (OJ 1997 C 139, p. 14), to require Member States, in accordance with Article 1 of Directive 2003/96, to tax electricity; the energy products used for the generation of that electricity must, as a corollary, be exempted from taxation in order to avoid, as observed by the Advocate General in points 56 to 62 of his Opinion, the double taxation of electricity.
32


Admittedly, Directive 2003/96 does not exclude all risk of double taxation, since, as has already been stated in paragraph 27 above, a Member State, in accordance with the second sentence of Article 14(1)(a) of that directive, may tax the energy products used to generate electricity for reasons of environmental protection (see judgment of 4 June 2015, Kernkraftwerke Lippe-Ems, C‑5/14, EU:C:2015:354, paragraph 51).
33


However, the fact remains that if a cogeneration unit, such as that at issue in the main proceedings, were to be deprived of the exemption under the first sentence of Article 14(1)(a) of Directive 2003/96 solely on the ground that it generates not only electricity but also combined heat and electricity, it could, as shown by the circumstances of the main proceedings in the present case, lead to unequal treatment between electricity producers, which would be a source of distortions of competition detrimental to the functioning of the internal market in the energy sector (see, to that effect, judgment of 21 December 2011, Haltergemeinschaft, C‑250/10, not published, EU:C:2011:862, paragraphs 17 and 18).
34


Moreover, it should be recalled that Directive 2003/96 also seeks to achieve the objective, as stated in recitals 6, 7, 11 and 12 thereof, of promoting environmental-policy objectives (judgment of 7 September 2017, Hüttenwerke Krupp Mannesmann, C‑465/15, EU:C:2017:640, paragraph 26).
40


The optional regime envisaged in that provision, under which Member States may exempt partially or totally or reduce the level of taxation for energy products used for combined heat and electricity generation, cannot be a determining factor for the purpose of defining the scope of the obligatory exemptions provided for in Article 14(1) of Directive 2003/96 (see, by analogy, judgment of 1 March 2007, Jan De Nul, C‑391/05, EU:C:2007:126, paragraph 29).
41


It should be recalled in this respect that, according to settled case-law, where a provision of EU law is open to several interpretations, preference must be given to that interpretation which ensures that the provision retains its effectiveness (see, inter alia, judgments of 18 December 2008, Afton Chemical, C‑517/07, EU:C:2008:751, paragraph 43, and of 10 September 2014, Holger Forstmann Transporte (C‑152/13, EU:C:2014:2184, paragraph 26).
43


In order not to deprive that provision of its effectiveness, the optional regime provided for in Article 15(1)(c) of Directive 2003/96 cannot therefore be merely residual in nature, in the sense of being limited to allowing Member States to give, as is apparent from recital 25 of that directive, ‘preferential treatment’ to energy products used for the combined generation of heat and electricity, by adopting, in order to promote the environmental-policy objectives recalled in paragraphs 34 to 37 above, a specific regime providing for the exemption for such energy products, that is to say, reducing the level of taxation, provided that the level of taxation chosen ensures the compulsory exemption for the portion of such products used for electricity generation (see, by analogy, judgment of 1 March 2007, Jan De Nul, C‑391/05, EU:C:2007:126, paragraph 29).