1 By order of 19 April 2000, received at the Court on 28 June 2000, the Finanzgericht München (Finance Court, Munich) referred to the Court for a preliminary ruling under Article 234 EC a question on the interpretation of Chapter 30 of the Combined Nomenclature, in Annex I to Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff (OJ 1987 L 256, p. 1), as amended by Commission Regulation (EC) No 2086/97 of 4 November 1997 (OJ 1997 L 312, p. 1).
2 The question has been raised in proceedings between Biochem Zusatzstoffe Handels- und Produktions GmbH (hereinafter Biochem) and the Oberfinanzdirektion Nürnberg (Regional Finance Office, Nuremberg) concerning the tariff classification of immunoglobulin concentrates obtained from colostrum. Law applicable The Combined Nomenclature
3 The Combined Nomenclature of the Common Customs Tariff (hereinafter the CN), established by Regulation No 2658/87, is designed to meet, at one and the same time, requirements of both the Common Customs Tariff and of the external trade statistics of the Community. It is based on the Harmonised Commodity Description and Coding System (hereinafter the HS) drawn up by the Customs Cooperation Council (now the World Customs Organisation), established by the International Convention concluded at Brussels on 14 June 1983 and approved on behalf of the Community by Council Decision 87/369/EEC of 7 April 1987 (OJ 1987 L 198, p. 1).
4 Chapter 4 of the CN is entitled: Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included.
5 Heading 0404 of the CN is worded as follows: 0404 Whey, whether or not concentrated or containing added sugar or other sweetening matter; products consisting of natural milk constituents, whether or not containing added sugar or other sweetening matter, not elsewhere specified or included: 0404 10 - Whey and modified whey, whether or not concentrated or containing added sugar or other sweetening matter: - - In powder, granules or other solid forms: - - - Not containing added sugar or other sweetening matter, of a protein content (nitrogen content x 6.38), by weight: ... 0404 10 06 - - - - - Exceeding 27% - - - - Exceeding 15%, and of a fat content, by weight: 0404 10 12 - - - - - Not exceeding 1.5% 0404 10 14 - - - - - Exceeding 1.5% but not exceeding 27% ... 0404 90 - Other: ...
6 Note 4 of Chapter 4 of the CN provides: This chapter does not cover: (a) ... (b) ... globulins (heading No 3504).
7 Subheading note 1 on subheading 0404 10 of the CN states: For the purposes of subheading 0404 10, the expression "modified whey" means products consisting of whey constitutes, i.e., whey from which all or part of the lactose, proteins or minerals have been removed, whey to which natural whey constituents have been added, and products obtained by mixing natural whey constituents.
8 Chapter 30 of the CN relates to pharmaceutical products.
9 Heading 3001 of the CN is worded as follows: Glands and other organs for organo-therapeutic uses, dried, whether or not powdered; extracts of glands or other organs or of their secretions for organo-therapeutic uses; heparin and its salts; other human or animal substances prepared for therapeutic or prophylactic uses, not elsewhere specified or included; ...
10 Heading 3004 of the CN covers the following products: Medicaments (excluding goods of heading Nos 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or in packings for retail sale: ...
11 Note 1 of Chapter 30 of the CN provides: This chapter does not cover: (a) foods or beverages (such as dietetic ... or fortified foods, food supplements ...
12 Chapter 35 of the CN provides in particular: ... 3504 00 00 Peptones and their derivatives; other protein substances and their derivatives, not elsewhere specified or included; hide powder, whether or not chromed.
13 The general rules for the interpretation of the CN, which are set forth in Part One of Title I A thereof, provide in particular: Classification of goods in the combined nomenclature shall be governed by the following principles: 1. The titles of sections, chapters and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to the following provisions: 2. (a) ... (b) Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of rule 3. 3. When by application of rule 2(b) or for any other reason, goods are prima facie classifiable under two or more headings, classification shall be effected as follows: (a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods. (b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character in so far as this criterion is applicable. ... The Explanatory Notes of the HS
14 Under Article 6(1) of the International Convention of 14 June 1983, a committee called the Harmonised System Committee, composed of representatives of each contracting party, was set up under the auspices of the Customs Cooperation Council. Its task consists in particular of proposing amendments to that convention and preparing explanatory notes, classification opinions and other advice on the interpretation of the HS.
15 Explanatory Note B on heading 3001 of the HS states that the heading covers: Extracts of glands or other organs or of their secretions for organo-therapeutic uses, obtained by solvent extraction, precipitation, coagulation or by any other process. These extracts may be in solid, semi-solid or liquid form, or in solution or suspension in any media necessary for their preservation. ... The heading excludes: ... (f) Globulins and globulin fractions (other than those of blood or serum) not prepared for therapeutic or prophylactic use (heading 3504).
16 The Explanatory Notes on heading 3504 of the HS provide: This heading covers: ... (B) Other protein substances and their derivatives, not covered by a more specific heading in the Nomenclature, including in particular: ... (2) Globulins, e.g., lactoglobulins and ovoglobulins ... The main proceedings and the question referred for a preliminary ruling
17 On 11 February 1998, Biochem applied for the issue of two binding tariff informations for immunoglobulin concentrates called Bio IG 15% and Bio IG 30%, which are products consisting of a white powder, standardised by means of lactose, containing 15% or 30% of immunoglobulin concentrate, based on dried, defatted and decaseinated colostrum. It asked for the products to be classified under heading 3001 of the CN as pharmaceutical products.
18 By binding tariff informations of 31 July 1998, the Oberfinanzdirektion Nürnberg classified those products under subheadings 0404 10 14 and 0404 10 12 of the CN as modified whey in powder form, not containing added sugar or other sweetening matter, of a protein content exceeding 15%.
19 When its objection against those binding informations was rejected by decision of 26 January 1999, Biochem brought proceedings before the referring court seeking annulment of those binding informations and classification of the products in question under heading 3001.
20 Taking the view that the case raised a question of interpretation of Community law, the Finanzgericht München decided to stay proceedings and to refer the following question to the Court for a preliminary ruling: On a proper construction of the combined nomenclature, in the version of Annex I to Regulation (EC) No 2086/97 of 4 November 1997 ..., amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff are immunoglobulin concentrates from dried, defatted and decaseinated colostrum, standardised by means of lactose, to be classified as pharmaceutical products in Chapter 30? The question referred for a preliminary ruling
21 According to general rule 3(b) for the interpretation of the CN, goods are to be classified according to the matter which gives them their essential character. In this regard, it is settled case-law that, in the interest of legal certainty and ease of verification, the decisive criterion for the classification of goods for customs purposes is in general to be sought in their objective characteristics and properties as defined in the wording of the relevant heading of the CN (see, in particular, Case C-270/96 Laboratoires Sarget [1998] ECR I-1121, paragraph 16).
22 The Explanatory Notes drawn up by the Commission, as regards the CN, and by the Customs Cooperation Council as regards the HS, significantly contribute to interpretation of the scope of the various customs headings without, however, having binding legal force (Laboratoires Sarget, paragraph 16).
23 The Oberfinanzdirektion Nürnberg contends that the products in question fall under heading 0404 of the CN on the ground that they are modified whey in powder form.
24 Biochem and the Commission, however, contend that the products fall under heading 3001 of the CN since they consist of secretions of animal glands for organo-therapeutic uses.
25 As regards the characteristics and properties of the products in question, Biochem has provided an uncontested description of them, according to which immunoglobulins are antibodies used for the passive immunisation of newborn calves. The necessary intake of immunoglobulins is present in the mother's colostrum on the birth of a calf. However, if newborn calves did not receive this colostrum with an appropriate percentage of immunoglobulins, they would inevitably die because the immunoglobulins contained in the colostrum create local immunisation protection in the alimentary tract and thus prevent digestive problems. The products in question, based on colostrum with the addition of immunoglobulins, act as a replacement for maternal colostrum, for example in the absence of the mother or to break the chain of infection transmitted through the mother's milk. The products are administered only on the day of birth of animals and are used both for therapeutic and prophylactic purposes.
26 It follows that products based on colostrum, a gland secretion for organo-therapeutic uses, supplemented by immunoglobulins, have a therapeutic purpose within the meaning of heading 3001 of the CN.
27 The answer to be given to the question must therefore be that on a proper construction of Annex I to Regulation No 2658/87, as amended by Regulation No 2086/97, immunoglobulin concentrates from dried, defatted and decaseinated colostrum, standardised by means of lactose, are to be classified as pharmaceutical products in Chapter 30 of the CN.