JUDGMENT OF THE GENERAL COURT (Second Chamber)
5 June 2013 (*)
(Customs union – Import of lactoglobulin concentrates from New Zealand – Post-clearance recovery of import duties – Request for remission of import duties – Article 220(2)(b) and Article 236 of Regulation (EEC) No 2913/92)
In Case T‑65/11,
Recombined Dairy System A/S, established in Horsens (Denmark), represented by T. Kristjánsson and T. Gønge, lawyers,
applicant,
v
European Commission, represented by A.-M. Caeiros, L. Keppenne and B.-R. Killmann, acting as Agents, and P. Dyrberg, lawyer,
defendant,
APPLICATION for partial annulment of Commission Decision C(2010) 7692 final of 12 November 2010, stating that the post-clearance entry in the accounts of certain import duties was justified and that the remission of such duties was not justified (File REC 03/08),
THE GENERAL COURT (Second Chamber),
composed of N.J. Forwood, President, F. Dehousse (Rapporteur) and J. Schwarcz, Judges,
Registrar: C. Kristensen, Administrator,
having regard to the written procedure and further to the hearing on 6 December 2012,
gives the following
Judgment
Background to the dispute
1 The applicant, Recombined Dairy Systems A/S, imported lactoglobulin concentrates (‘LGCs’) from New Zealand into the European Union. There are various forms of LGCs characterised by the whey protein content.
2 In 1993 and 1994, the applicant lodged a request with the Danish customs authorities to obtain binding tariff informations (‘BTI’) for 10 LGCs, including LGC 312, 392 and 472. The BTIs for those three products were issued to the applicant on the basis of the information received, without carrying out any analyses of the products. The information sent by the applicant and set out in the BTIs indicated, in particular, a whey protein content calculated on dry matter greater than 80% and a composition of 75% of beta-lactoglobulin and immunoglobulin and 25% of other whey proteins. The LGCs concerned were classified under tariff heading 3504 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 (‘the nomenclature’). Tariff heading 3504 of the nomenclature refers, in particular to ‘concentrated milk proteins’. The BTIs for those three products were valid from 13 April 1994 until 12 April 2000.
3 In 1995, the applicant lodged an application with the Danish customs authorities seeking a BTI for LGC 450. Those authorities informed the applicant that a new BTI was unnecessary in so far as LGC 450 was largely identical to LGC 472, for which a BTI had already been issued. The applicant withdrew its request. Therefore, it did not obtain a BTI for LGC 450.
4 For other types of products, namely LGC 131 and 8471, the applicant did not lodge a request for a BTI.
5 Following the analysis of a sample, which showed a whey protein content lower than that originally declared (that is a whey protein content of less than 80%), the Danish customs authorities analysed all the LGCs imported by the applicant. On that basis, on 27 November 2000, they decided to classify LGCs 131, 312, 392, 450 and 8471 under tariff heading 0404 of the nomenclature and to make a subsequent entry in the accounts of import duties in respect of those products. That tariff heading referred, in particular to, ‘[w]hey, whether or not concentrated’. They also stated in that decision that if the whey protein content originally declared by the applicant had been correct (that is a whey protein content exceeding 80%) they would have classified the products in question under heading 3502 of the nomenclature. That tariff heading referred, in particular, to ‘concentrates of two or more whey proteins, containing by weight more than 80% whey proteins, calculated on the dry matter’. Therefore, they opted not to classify the products concerned under tariff heading 3504 of the nomenclature.
6 Since the applicant challenged the tariff classification and the method of analysis used, the Danish customs authorities changed their method and finally concluded that the protein content of the LGCs originally declared by the applicant was correct (a level of whey protein calculated on dry matter exceeding 80%). They decided to re-examine the tariff classification and amended their decision, classifying LGCs 131, 312, 392, 450 and 8471 under tariff heading 3502 of the nomenclature. That amendment to the tariff classification had no effect on their decision to make a post-clearance entry in the accounts of import duties of the products concerned.
7 On 13 June 2005, the applicant lodged a request for remission of import duties on the basis of Article 220(2)(b) in conjunction with Article 236, and Article 239 of Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code (OJ 1992 L 302, p. 1). Its request concerned the import of LGCs during the period from 1 September 1997 to 2 August 2000, for which either a BTI had never been issued, or the period for the validity of the BTIs previously issued had expired at the time of the imports. The Danish customs authorities rejected that request by a decision of 1 August 2005.
8 On 22 September 2005, the applicant brought an appeal against that decision before the Landsskatteretten (National Tax Court, Denmark).
9 On 13 September 2007, the Landsskatteretten ordered the Danish customs authorities to submit the applicant’s request to the Commission of the European Communities for a decision. The Landsskatteretten held, in particular, that it was possible, taking account of the circumstances of the case, that the conditions laid down by Article 220(2)(b) or Article 239 of the Customs Code were fulfilled.
10 On 6 October 2008, the Danish authorities lodged an application with the Commission seeking a decision whether, pursuant to Article 220(2)(b) of the Customs Code, the waiver of the post-clearance entry in the accounts of the import duties was justified and, in the alternative, whether, pursuant to Article 239 of the Customs Code, the remission of those rights was justified.
11 By decision C (2010) 7692 final of 12 November 2010, declaring that the post-clearance entry in the accounts of certain import duties was justified and that the remission of those rights was not justified (file REC 03/08) (‘the contested decision’), the Commission held, first, that it was justified, pursuant to Article 220(2)(b) of the Customs Code, not to waive the post-clearance entry of import duties for imports of LGC 450 prior to 13 April 2000. As regards the imports of other products, namely LGCs 131, 312, 392 and 8471, and LGC 450 imported from 13 April 2000, the Commission held that post-clearance entry in the accounts of import duties was justified. Second, it held, on the basis of Article 239 of the Customs Code that the remission of import duties was justified for imports of LGC 312 and 392 and imports of LGC 450 made from 13 April 2000. However, it held that no remission of import duties was justified for imports of LGC 131 and 8471. It stated, in that regard, that no special conditions existed, within the meaning of Article 239 of the Customs Code, since the applicant had never requested a BTI for those products.
Procedure and forms of order sought
12 By application lodged at the Court Registry on 28 January 2011, the applicant brought the present action.
13 Upon hearing the report of the Judge-Rapporteur, the Court (Second Chamber) decided to open the oral procedure.
14 The parties presented oral argument and replied to the questions put by the Court at the hearing on 6 December 2012.
15 The applicant claims that the Court should:
– annul Article 1(2) and (4) of the contested decision;
– order the Commission to pay the costs.
16 The Commission contends that the Court should:
– dismiss the action;
– order the applicant to pay the costs.
Law
17 As a preliminary point, it must be observed, as the applicant confirmed at the hearing, that the present action seeks the annulment of Article 1(2) and (4) of the contested decision in so far as it concerns imports of LG 131 and 8471.
18 The applicant raises two pleas in support of its action. The first plea, which is the main plea, alleges infringement of Article 220(2)(b) and Article 236 of the Customs Code. The second plea alleges, in the alternative, an infringement of Article 239 of the Customs Code.
19 The Court considers it appropriate to examine the first plea raised by the applicant first of all.
20 The applicant submits essentially that the classification of the LGCs at issue under tariff heading 3504 of the nomenclature is an error attributable to the Danish customs authorities, irrespective of whether or not those LGCs were issued with BTIs.
21 The Commission challenges the applicant’s arguments. It states, in particular, that, in general, LGCs are not all identical as regards tariffs. It also argues that not one BTI was issued for the products at issue in the present dispute. Furthermore, there were few imports of LGC 131 and 8471. Finally, no documents were produced to show that the designation of the goods in the customs declarations corresponded to the specifications in the nomenclature.
22 As a preliminary point, it must be recalled that the procedures set out in Articles 220 and 239 of the Customs Code pursue the same aim, namely to limit the post-clearance payment of import and export duties to cases where such payment is justified and is compatible with a fundamental principle such as that of the protection of legitimate expectations. The repayment or remission of import and export duties, which may be made only under certain conditions and in cases specifically provided for, constitutes an exception to the normal import and export procedure and, consequently, the provisions which provide for such repayment or remission must be interpreted strictly (see order of 1 October 2009 in Case C‑552/08 P Agrar-Invest-Tatschl v Commission [2009] ECR I‑9265, paragraphs 52 and 53 and the case-law cited).
23 As regards Article 220(2)(b) of the Customs Code, it must be recalled that, according to that provision, the competent authorities are not to make subsequent entry of the import duties in the accounts unless three cumulative conditions are fulfilled. First, it is necessary that the duties were not levied as a result of an error on the part of the competent authorities themselves, secondly, that the error made by them was such that it could not reasonably have been detected by a person liable for payment acting in good faith and, finally, that that person complied with all the provisions laid down by the legislation in force as regards the customs declaration (Case C‑173/06 Agrover [2007] ECR I‑8783, paragraph 30 and the case-law cited).
24 As regards the first of those conditions, it should be noted that Article 220(2)(b) of the Customs Code is intended to protect the legitimate expectations of the person liable for payment that all the information and criteria on which the decision to recover or not to recover customs duties is based are correct. The legitimate expectations of the person liable attract the protection provided for in that article only if it was the competent authorities ‘themselves’ which created the basis for those expectations. Thus, only errors attributable to acts of the competent authorities create entitlement to the waiver of subsequent recovery of customs duties (Agrover, paragraph 31 and the case-law cited).
25 That condition cannot be regarded as fulfilled where the competent authorities have been misled – in particular as to the origin of the goods – by incorrect declarations on the part of the exporter whose validity they do not have to check or assess. In those circumstances, it is the person liable who must bear the risks arising from a commercial document which is found to be false when subsequently checked (Case C‑251/00 Ilumitrónica [2002] ECR I‑10433, paragraphs 43 and 44 and the case-law cited). However, according to the case-law, the competent authorities may be regarded as having committed an error where they have not raised any objection to the tariff classification of the goods made by the trader in its customs declarations, if those declarations contained all the factual particulars needed in order to apply the relevant rules, so that any subsequent check carried out by the customs authorities could not disclose any new fact. That is the case in particular where all the customs declarations submitted by the trader have been complete, in that they gave, in particular, a description of the goods in accordance with the indications of the nomenclature beside the declared tariff heading and where the imports in question have been fairly numerous and have taken place over a relatively long period without the tariff heading having been challenged (see Case C‑250/91 Hewlett Packard France [1993] ECR I‑1819, paragraphs 19 and 20 and the case-law cited).
26 In the present case, the Commission took the view in the contested decision, as regards imports of LGC 131 and 8471, that the Danish customs authorities had not committed any error, since no BTI had been issued to the applicant for those products (recital 31 in the preamble to the contested decision). The Commission also concluded that the applicant had acted in good faith and had complied with all the provisions in force as far as concerns the customs declaration (recital 39 in the preamble to the contested decision).
27 First, the Commission’s arguments set out in the contested decision and repeated before the Court arguing essentially that the fact that no BTI was issued did not support a finding that the customs authorities had committed an error. The fact that the applicant did not request a BTI for the products concerned does not mean, however, that the customs authorities have not committed an error. Any other interpretation would undermine the application of Article 220(2)(b) of the Customs Code. Furthermore, the case-law recognises that the customs authorities could have committed an error in situations in which the applicant was not the holder of or had not requested BTIs (Case 314/85 Foto-Frost [1987] ECR 4199)
28 Second, it must be observed, as is clear from the contested decision, that the Danish customs authorities committed an error as to the tariff classification when the BTIs were issued (recitals 24 and 33 in the preamble to the contested decision).
29 Third, the Commission states, in recital 45 in the preamble to the contested decision, that, in November 1999, that is before the end of the disputed period for import of LGCs 131 and 8471 which extended from 1 September 1997 until 2 August 2000, the Danish customs authorities knew that the tariff heading for the products which had been issued with a BTI was incorrect although they did not revoke those BTIs. It is also clear from the contested decision that the analyses conducted by the Danish customs authorities concerned not only the products which had been issued with a BTI, but also LGC 131, which had not (recitals 9 and 10 in the preamble to the contested decision). Consequently, the Danish customs authorities knew that from November 1999 the tariff heading of one of the two products concerned by the present dispute was incorrect. They nonetheless waited until 27 November 2000 before initiating the procedure for recovery (recital 13 in the preamble to the contested decision). Even though they had the opportunity to do so, they did not revoke the BTIs which were valid and which expired on 12 April 2000. Furthermore, it must be observed that between November 1999 and November 2000 the applicant imported, under tariff heading 3504 of the nomenclature, approximately 240 tons of LGC 131 in 13 import operations and 40 tons of LGC 8471 in two import operations, even though the Danish customs authorities knew that the tariff classifications for the LGCs in general and, in particular, that of LGC 131, were incorrect. Finally, specifically as regards LGC 131, it must be observed that, contrary to the Commission’s assertions in its pleadings, the imports of that product by the applicant were significant during the disputed import period because they amounted to several hundred tons and 45 import operations. It must be added that the parties agree, as confirmed at the hearing, on the fact that the products concerned, in so far as they were constituted by whey protein, could not be classified under tariff heading 3504 of the nomenclature as the customs authorities did in the BTIs. The Danish customs authorities also acknowledged that fact since, in their decision of 27 November 2000 to make a post-clearance entry in the accounts, they stated that ‘the classification under the goods code 3504 [was] excluded, since the products were not constituted by milk protein but by whey protein’. It follows that, taking account of the description of the products concerned in the import declarations, which specifically referred to a whey protein, namely ‘lactoglobulin’, the customs authorities ought to have been able to detect the error in the tariff classification.
30 Fourth, it must be observed that, neither the Danish customs authorities nor the Commission, in the contested decision, challenged the completeness of all the customs declarations submitted by the applicant. In particular, the Commission, in the contested decision, accepted that ‘it [was] clear from the request that the person concerned [had] to be regarded as having acted in good faith and having observed all the provisions in force as far as concerns the customs declaration’ (recital 39 in the preamble to the contested decision). There is nothing in the contested decision to support the Commission’s statement in its pleadings that ‘the designation of the goods in the declaration was incomplete’. Furthermore, the Commission was not in a position at the hearing to provide a legal basis from which it could be concluded that the customs declarations made by the applicant were incomplete. Furthermore, as regards the Commission’s assertion that the applicant has not produced any technical documents concerning LGCs 131 and 8471 to enable their tariff classification to be determined, it must be recalled that LGC 131 was one of the products which had been the subject of a technical analysis by the customs authorities in 1999 (recital 9 in the preamble to the contested decision). Furthermore, it is common ground that LGCs 131 and 8471 were classified by the Danish customs authorities after analysis, under the same tariff heading as the other LGCs, including those which had been issued with a BTI. Finally, it must be recalled that the parties agree that the products concerned, in so far as they were constituted by whey proteins, could not be classified under tariff heading 3504 of the nomenclature. Therefore, it must be held that the designation of the goods in the applicant’s customs declaration, ‘lactoglobulin’, was sufficiently precise to enable the customs authorities to determine, at the very least, that the products at issue ought not to have been classified under that tariff heading.
31 Fifth, during a telephone interview with the applicant on 2 November 1995, the Danish customs authorities stated that it was not necessary to obtain a BTI for a product, in this case LGC 450, which was, following the request lodged by the applicant, ‘largely identical’ to a product which had been issued with a BTI, in this case LGC 472. That telephone interview was confirmed by a letter sent by the applicant to the Danish customs authorities on 3 November 1995, the content of which was not subsequently invalidated, which the Commission observes in recital 35 in the preamble to the contested decision. The customs authorities themselves, repeating the applicant’s arguments presented before them, mention the existence and content of that telephone interview in their request sent to the Commission. Moreover, that situation led the Commission to conclude, in the same recital, that the Danish customs authorities had committed an error as regards the imports of LGC 450 prior to 13 April 2000.
32 As far as concerns the products at issue in the present dispute, the Commission observes, in recital 24 in the preamble to the contested decision, that, according to the request sent by the Danish customs authorities, the failure to make an entry in the accounts and the remission of the import duties is justified in so far as ‘the products not covered by a BTI are, from the point of view of the tariff classification, identical to the products for which a BTI had been issued’. That finding of fact was not challenged by the Commission in the contested decision.
33 Furthermore, it must be stated that, whatever the tariff heading chosen by the Danish customs authorities in their repayment notice, all the LGCs concerned have always been classified under the same tariff heading. It follows that, for the Danish customs authorities, LGCs 131 and 8471 were identical products, for the purpose of tariff classification, as the other LGCs imported, including those which had been issued with a BTI. That finding is also supported by the request from the Danish customs authorities to the Commission, in which they stated that ‘all the samples have a protein content of at least 80% by weight calculated from dry matter’ or that the products concerned were ‘constituted of concentrates of several whey proteins containing more than 80% whey protein by weight’. That finding of fact is also repeated by the Landsskatteretten in its decision of 13 September 2007. Taking account of the explanations provided by the parties in their pleadings, for the purposes of the tariff classification of the products concerned, the only distinction made is between products which have a whey protein content of more than 80% and those which contain less than 80% whey protein. It follows that the products concerned, according to the explanations given by the Danish customs authorities, were in fact identical from the point of view of tariff classification, which the Commission recognised at the hearing. In particular, at the hearing, the Commission was unable to indicate the relevant factors differentiating between the LGCs concerned which could lead to a finding that those LGCs were not one type of goods within the meaning of the customs regulations (Case C‑199/09 Schenker [2010] ECR I‑12311, paragraph 24). Furthermore, the Commission has never challenged the statement by the Danish customs authorities as to the fact that the products concerned are identical from the point of view of tariff classifications and has not made any requests for further information. It must be stated, on that point, that, under Article 871(5) of Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code (OJ 1993 L 253, p. 1), should it be found that the information supplied by the Member State is not sufficient to enable a decision to be taken on the case concerned in full knowledge of the facts, the Commission may request that additional information be supplied. It follows from the foregoing that, in the present case, the applicant could take the view that LGCs 131 and 8471, even if they did not have a BTI, ought to have been classified under the same tariff heading as those products in respect of which a BTI was issued.
34 In the light of all of the foregoing, it must be held that the Danish customs authorities committed an error, within the meaning of Article 220(2)(b) of the Customs Code as regards the tariff classifications of LGCs 131 and 8471. The contested decision is therefore unlawful in that respect, in so far as it is based on the absence of such an error.
35 Accordingly, without there being any need to examine the second plea raised by the applicant in the alternative, the first plea must be upheld and, therefore, Article 1(2) and (4) of the contested decision must be annulled in so far as it concerns imports of LGC 131 and 8471.
Costs
36 Under Article 87(2) of the Rules of Procedure of the Court of First Instance, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Commission has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the applicant
On those grounds,
THE GENERAL COURT (Second Chamber)
hereby:
1. Annuls Article 1(2) and (4) of Commission Decision C(2010) 7692 final of 12 November 2010 stating that the post-clearance entry in the accounts of certain import duties was justified and that the remission of such duties was not justified (file REC 03/08) as far as it concerns the imports of lactoglobulin concentrates 131 and 8471;
2. Orders the European Commission to pay its own costs and those incurred by Recombined Dairy System A/S.
Forwood | Dehousse | Schwarcz |
Delivered in open court in Luxembourg on 5 June 2013.
[Signatures]