PRESS RELEASE No 52/98

15 September 1998

Judgment of the Court of Justice of the European Communities in Case C-231/96
Edilizia Industriale Siderurgica Srl (Edis) v Ministero delle Finanze

Judgment of the Court in Case C-260/96
Ministero dell Finanze v Spac SpA

Judgment of the Court in Joined Cases C-279/96, C-280/96 and C-281/96
Ansaldo Energia SpA v Amministrazione delle Finanze dello Stato
Amministrazione delle Finanze dello Stato v Marine Insurance Consultants Srl
GMB Srl and Others v Amministrazione delle Finanze dello Stato

ITALY IS ENTITLED TO RESIST ACTIONS FOR REPAYMENT OF AN ADMINISTRATIVE CHARGE FOR COMPANY REGISTRATION LEVIED IN BREACH OF COMMUNITY LAW BY RELYING ON A TIME-LIMIT OF THREE YEARS UNDER NATIONAL LAW

The Court gives judgment as to the validity of a national time-limit which constitutes an obstacle to claims for repayment of charges levied in breach of Community law

Two Italian courts, the Tribunale di Genova and the Corte d'Appello di Venezia, sought a preliminary ruling from the Court of Justice on a number of questions concerning the interpretation of Community law in connection with proceedings pending before them between 16 Italian public and private limited companies and the Italian Finance Administration.

In 1972 a Government "administrative charge" was introduced in Italy for the registration of companies. As from 1985, the charge was payable not only upon registration of the document incorporating the company but also on 30 June of each calendar year thereafter. By 1989 the charge amounted to LIT 12 million for public limited companies and partnerships limited by shares, LIT 3.5 million for private limited companies and LIT 500 000 for other companies.

In its judgment of 20 April 1993 in Ponente Carni and Cispadana Construzioni , concerning the same administrative charge, the Court of Justice held that the 1969 Community directive concerning "indirect taxes on the raising of capital" was to be interpreted as prohibiting an annual charge due in respect of the registration of capital companies and as not authorising the imposition of a charge on such companies at the time of registration unless the amounts were calculated on the basis of the cost of the transaction, which might be assessed on a flat-rate basis. Following that judgment, the Italian registration charge was reduced and ceased to be payable annually as from 1993.

Several of the companies mentioned applied for reimbursement of the administrative charge which they had paid, and interest thereon. However, the Italian Finance Administration invoked a 1972 provision of Italian law to the effect that a "taxpayer may request repayment of charges wrongly paid within a period of three years reckoned from the date of payment, failing which his action shall be barred" (Article 13(2) of Decree No 641/72).

The two national courts entertained doubts as to the compatibility with Community law of those procedural rules governing repayment. They observed that, according to the general rules of Italian law, an action to recover sums paid but not due was subject not to a peremptory time-limit but merely to the ten-year limitation period. The two courts therefore stayed proceedings and referred questions to the Court, on which preliminary rulings have been given today.

The Court observed that a comparison of the national systems showed that the problem of disputing charges which had been unlawfully claimed or refunding charges which had been paid but not due was settled in different ways in the various Member States, and even within a single Member State, according to the various kinds of taxes or charges in question. This diversity between national systems derived mainly from the lack of Community rules on the refunding of national charges levied but not due. In such circumstances, it was for the domestic legal system of each Member State to designate the courts and tribunals having jurisdiction and to lay down the detailed procedural rules governing actions for safeguarding rights which individuals derived from Community law, provided, first, that such rules were not less favourable than those governing similar domestic actions (principle of equivalence) and, second, that they did not render virtually impossible or excessively difficult the exercise of rights conferred by Community law (principle of effectiveness).

As regards the principle of effectiveness, the Court held that it was compatible with Community law to lay down reasonable limitation periods for bringing proceedings in the interests of legal certainty which protected both the taxpayer and the administration concerned. Such time-limits were not liable to render virtually impossible or excessively difficult the exercise of rights conferred by Community law. In that regard, a time-limit of three years under national law, reckoned from the date of the contested payments, appeared reasonable.

Observance of the principle of equivalence implied that the procedural rule at issue applied without distinction to actions alleging infringements of Community law and to those alleging infringements of national law, with respect to the same kind of charges or dues. In this case, the time-limit affected not only the administrative charge at issue but also all governmental charges of that kind. The principle of equivalence could not, however, be interpreted as obliging a Member State to extend its most favourable rules governing recovery under national law to all actions for repayment of charges or dues levied in breach of Community law. Thus, Community law did not preclude the legislation of a Member State from laying down, alongside a limitation period applicable under the ordinary law to actions between private individuals for the recovery of sums paid but not due, special detailed rules, which were less favourable, governing claims and legal proceedings to challenge the imposition of charges and other levies.

As regards the problem of the application of a time-limit under national law even though the Community directive concerned had not yet been properly transposed into national law, the Court referred to its judgment of 2 December 1992 in Fantask and Others in which it held that Community law did not prevent a Member State which had not properly transposed a directive from resisting actions for repayment of duties levied in breach thereof by relying on a limitation period under national law of five years reckoned from the date on which those duties became payable.

As to the problem of the compatibility with Community law of national provisions which required, for all repayment obligations attaching to the State, the payment of interest at the rate of 3% per half-year, even though under the rules of the Italian Civil Code on the recovery of sums unduly paid the legally prescribed rate was 10% per annum, the Court found that Community law did not preclude legislation of that kind.