C-77/71

JUDGMENT OF 15. 12. 1971 — CASE 77/71

In Case 77/71

Reference to the Court under Article 177 of the EEC Treaty by the Third Senate of the Finanzgericht München for a preliminary ruling in the action pending before that court between

GERVAIS-DANONE AG, 8 Munich 80, Sieberstra e 4,

and

HAUPTZOLLAMT MÜNCHEN-SCHWANTHALERSTRASSE,

Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

I — Facts and procedure main action (hereafter referred to as the plaintiff) obtained customs clearance in The facts and procedure may be sum­ Germany for 56 consignments of a cer­ marized as follows: tain product of Yugoslav origin which During the period from 12 August 1968 was described essentially as mayonnaise. to 27 March 1969 the plaintiff in the During the period from 4 December

GERVAIS-DANONE v HAUPTZOLLAMT MÜNCHEN

tion as to the composition of the pro by weight of milk fats')'. In an amended duct stated '83% fats, 6.5% egg yolk, notice of assessment dated 25 Novem 0.5% salt and 5% acetic acid, without ber 1969, in the wording of the version binding agents, colouring matter or pre dated 5 March 1970, the Hauptzollamt servatives'. claimed payment of an additional sum The products of Danish origin described by way of customs duties and turnover as 'mayonnaise' or 'I A mayonnaise' con

technische Prüfungs-und Lehranstalt was in this way to make good the (Customs Technology Research and lacunae in Community law. As the Ger Training Institute) in Munich. On the basis of the result of this examin man customs authorities had no power to amend tariff heading 21.04, their at ation the Zolltechnische Prüfungs-und tempt to do so was unlawful. Lehranstalt considered that, by reason of its weight in milk fats, the product The wide and general terms in which in question had to be classified under heading 21.04 is drafted show that from tariff heading 21.07 F, VII, (a), 1. the point of view of Community law all Meanwhile, the Hauptzollamt (Principal sauces fall under this tariff heading Customs Office) München-Schwanthaler without regard to their composition, even straße carried out an inspection of all if they contain basic products which are the imports made by the plaintiff and, governed by the market organizations. in the light of the result of this inspec By only excluding from heading 21.04 tion, decided that the product described food preparations based on milk fats as 'mayonnaise' was principally com which 'are clearly not intended for con pised of milk fats. The Hauptzollamt sumption in the unaltered state as sauces'

Regulation No 241/70 of the Commis lamt maintains that this information, sion confirmed this view. Moreover, as which does not constitute generally it amended the Common Customs Tariff binding interpretations (allgemein ver this regulation was unlawful, as the bindliche Auslegungen) of the definitions Commission had no power to take such of the Common Customs tariff, are still action. Regulation No 241/70 could valid after the entry into force of the also not he applied retrospectively. Common Customs Tariff. The amended assessment decision is By order of 23 July 1971 received at the based upon Regulation No 160/66 of Court Registry on 11 August 1971 the the Council.

21.04 or 21.07? If so, is the trade maintains that according to the Explana usage in all the Member States tory Notes to the Brussels Nomenclature decisive or can a trade usage the conclusive factor in classification prevailing solely in one Member under heading 21.04 is—apart from State be taken into account if it strong seasoning—that the products con diverges from the trade usage in cerned are preparations intended to im other Member States? prove the flavour of certain foods.

Treaty. on the basis of the properties As regards the applicant ’s statement that of the product at the relevant the German tax authorities were no date it must be plainly dis longer in a position to issue verbind cernible that the product is liche Zolltarifauskünfte', the Hauptzol- not intended for consumption

in the unaltered state as vocate-General the Court decided to sauce, mixed condiment or open the oral procedure, without hold­ mixed seasoning? ing any preparatory inquiry. (2) By whom (the Customs Office Gervais-Danone AG, represented by F. or the appropriate trade cir­ Modest, the Government of the Federal cles) must this be discernible? Republic of Germany, represented by H. In this connexion may refer­ Lauberau, and the Commission of the ence be made to the trade European Communities, represented by usage in the importing coun­ Peter Kalbe submitted their oral obser­ try? vations during the hearing on 1 Decem­ ber 1971. (3) Is it sufficient for the word 'clearly', The Advocate-General delivered his (a) that the commercial docu­ opinion at the hearing on 14 December ments show that the pro­ 1971. duct is not intended ab initio for consumption in II — Observations submit­ the unaltered state as ted to the Court sauce, mixed condiment or mixed seasoning, or The observations submitted under (b) can this be deduced from Article 20 of the Protocol on the Statute the circumstances of the of the Court of Justice may be summar­ further treatment of the ized as follows: product after the relevant date? If so, what condi­ On question I (a) tions must be fulfilled for The plaintiff maintains that in part the this deduction? question is wrongly worded. The classi­ II. (a) Since the entry into force of fication of particular goods under head­ Regulation No 950/68 are the ing 21.04 does not depend on their de­ Oberfinanzdirektionen (Regional scription. The composition, the physical Finance Authorities) still entitled properties and the suitability of such to issue binding customs tariff goods for a specific purpose—in par­ notices (verbindliche Zolltarif- ticular to improve the flavour of certain auskünfte') under paragraph 23 foods—, could alone be taken into con­ of the German Customs Law? sideration. In general, the use of milk (b) If (a) is answered in the negative: fats as the basic ingredient in the com­ was this also the case before the position of sauces cannot influence their entry into force of Regulation No classification under heading 21.04 of the Common Customs Tariff." This is 950/68 with regard to products that were subject to EEC com­ already apparent from the Explanatory Notes to the Brussels Nomenclature and mercial rules, in this case, Regu­ lation No 160/66 of the Coun­ was confirmed by Regulation No 241/ cil? 70 of the Commission. As regards clas­ The plaintiff, the Government of the sification under heading 21.04 the only Federal Republic of Germany and the decisive factor is the presence of flavour­ Commission of the European Communi­ ing ingredients in the products in ques­ ties submitted written observations un­ tion, composed either of milk fats or der Article 20 of the Protocol on the vegetable fats, which render it likely Statute of the Court of Justice of the that their intended purpose is to im­ EEC. prove the flavour of certain foods. Upon hearing the report of the Judge- The Government of the Federal Repub­ Rapporteur and the opinion of the Ad- lic of Germany observes that the milk

ferent flavouring ingredients. The fat sauces in the preparation of certain content varies from 50 to 80%. dishes. No trade usages exist as regards Moreover, mayonnaise with a fat con­ their composition. This view is con­ tent of more than 50% must be dis­ firmed by the Proposal for a Council tinguished from that with a content of Directive on the approximation of the less than 50%. Mayonnaise with a fat laws of the Member States concerning content of less than 50% might contain mayonnaise, mayonnaise-based sauces butter or butteroil without losing its and other emulsified sauces intended for characteristics as mayonnaise if, through flavouring (OJ 1970, C 18, p. 9). The the application of stabilizing agents, the Government of the Federal Republic of melting point is lowered. Germany observes that neither the The Government of the Federal Repub­ 'General Rules for the Interpretation of lic of Germany concludes from this that the Customs Nomenclature' nor those goods described as 'diet mayonnaise' or concerning the interpretation of the 'salad mayonnaise' of a milk fats con­ nomenclature in the Common Customs tent of more than 50% cannot be clas­ Tariff contain provisions referring to sified under heading 21.04 of the Com­ prevailing trade usage. As such usage mon Customs Tariff. only exists in relation to individual pro­ If the fat content of goods described as ducts the question must be answered in mayonnaise, I A mayonnaise, diet relation to mayonnaise alone. As regards mayonnaise or salad mayonnaise is less mayonnaise trade usages exist through­ than 50%, the use of butter or of butter- out the world: it is a seasoned or flav­

The use of a fat of a low melting point 97/69 and which, therefore, is un as a basic ingredient constitutes the de lawful cisive criterion. (b) The Commission introduced obscure The Commission maintains that trade and indefinite concepts into Regula usage must be taken into account in tion No 241/70 which renders its every case in which flavourings must interpretation impossible. This is al be classified in order to determine ready apparent from the questions re whether the goods in question are in ferred by the Finanzgericht, in par tended for consumption in the unaltered ticular questions I (d) (1), (2) and state as sauces, mixed condiments or (3). Since it does not provide an mixed seasonings, since neither the text unambiguous interpretation of the of the customs tariff nor the Explana Common Customs Tariff the regula tory Notes to the Brussels Nomenclature tion has no legal effect. concerning heading 21.04 lay down any The applicant considers that if Regu clear and specific principles.

Member State. tice is explained by the fact that al On question I (c) though the interpretations given are formally of a declaratory nature, in The plaintiff considers that Regulation commercial practice they have' the No 241/70 is void for the following effect of legislation, particularly when reasons: the new interpretations result in the [a) Regulation No 97/69 of the Council classification of certain products un of 16 January 1969 (OJ L 14, p. 1) der another heading in the nomen authorizes the Commission to clarify clature, which leads to a change in the Common Customs Tariff with the duty imposed. out however modifying its content Regulation No 241/70 alters the and scope.

system. It thus amends the content of interpretation to be considered after and scope of the Common Customs 13 February 1970. Tariff. By limiting the content of The Commission observes that, for the heading 21.04 and by extending the following reasons, Regulation No 241/70 content of heading 21.07, Regulation is applicable to any dispute concerning No 241/70 constitutes a measure the classification of the products in which is not covered by the author question which has to be settled after its ization given by Regulation No entry into force.

As regards their content, provisions such goods are not intended for consumption as those contained in Regulation No in the unaltered state as sauces, mixed 241/70 are merely explanatory in nature condiments or mixed seasonings can only and intended to clarify the scope of the be assessed on the basis of the physical headings in the tariff to which they properties of the goods. These properties refer. The implied recommendation of form the only objective criterion by the Court of Justice in the judgment of which its intended purpose can be 18 June 1970 in Hauptzollamt Bremen- judged.

such a way. The legal form of Regula lic of Germany observes that the classi tion No 241/70 obliges the authorities fication of the products in question must and the courts in the Member States to depend on the physical properties and apply the uniform interpretation of the external characteristics of such products text of the Tariff given by this regula at the time to be taken into considera tion. It is also clear from its legal form tion for determining the classification. that, from the entry into force of this The Commission maintains that the regulation, authorities and courts are term 'clearly' signifies that the competent obliged to assess and resolve the prob authorities must classify the goods in lems which are before them in accord question under heading 21.07 when it ance with the rules which it enunciates. is established that, taking trade usage The legal basis of this Regulation was and the specific purpose of the goods to be found in Regulation No 97/69 into account, they are not intended for of the Council of 16 January 1969 (OJ consumption in the unaltered state as L 14, p. 1) and in particular in Article sauces, mixed condiments or mixed 3 which authorizes the Commission to

claratory in nature. Finally, an argu ment in favour of the declaratory nature On Question I (d) (3) of this regulation is to be found in its penultimate recital, in which reference The plaintiff observes that the ultimate is made to the Explanatory Notes to the purpose of the goods may possibly be Brussels Nomenclature. deduced from the commercial docu ments. In the rare cases in which it is On Question I (d) (1) clear that the importer does not intend The plaintiff maintains that in the light the products imported to be consumed of its reply to Question I (c) it is un in the unaltered state, conclusions may necessary to express any opinion on this properly be drawn from this fact as

GERVAIS-DANONE v HAUPTZOLLAMT MÜNCHEN

The Government of the Federal Re­ is to protect the legitimate expectations public of Germany and the Commission of persons subject to the jurisdiction of do not oppose the consideration of the the customs authorities as regards the commercial documents or circumstances interpretation of the Common Customs surrounding the subsequent treatment of Tariff by such authorities in a Member the product in order to decide therefrom State. To the extent to which they are whether it is 'clearly' intended for con­ concerned with interpretations of in­ sumption in the unaltered state. dividual cases they are compatible with Community law. In such a case the con­ On Question II (a) sequences of a possible mistaken inter­ pretation of the Customs Tariff on the basis of a 'verbindliche Zolltarifaus­ The plaintiff claims that the case-law of the Court of Justice (Judgments of 18 künfte' are the same as an incorrect

JUDGMENT OF 15. 12. 1971 — CASE 77/71

Grounds of judgment

1 By an order dated 23 July 1971, pursuant to Article 177 of the EEC Treaty, which arrived at the Court on 11 August 1971, the Finanzgericht München has submitted for a preliminary ruling two questions regarding the interpreta­ tion of Regulation (EEC) No 950/68 of the Council of 28 June 1968 on the Common Customs Tariff (OJ 1968, L 172). The first question concerns the interpretation of headings 21.04 and 21.07 of the Common Customs Tariff and the effect of Regulation No 241/70 of the Commission of 9 February 1970 (OJ 1970, L 32) on the application of these headings to imports effected before the entry into force of this Regulation and the second relates to the compatibility of verbindliche Zolltarifauskünfte (binding customs tariff notices) issued under Article 23 of the German Zollgesetz (Customs Law) with Regulation No 950/68.

The first question

2 The first question seeks in the first place to ascertain whether it makes 'any difference for the classification of a product described as diet mayonnaise, I A mayonnaise or salad mayonnaise under heading 21.04 of the Common Customs Tariff whether the product has been manufactured by using butter, butteroil or fractionated dry butterfat and if so, what difference'. Then it is asked whether the tariff classification depends on trade usage (Verkehsauffassung) or on provisions of Regulation No 241/70 which did not come into force until after the imports in question.

3 It appears from the documents in the case that the dispute is whether the product in question should be classified under heading 21.04 (sauces; mixed condiments and mixed seasonings) or heading 21.07 (food preparations not elsewhere specified or included) of the Common Customs Tariff.

7 Consequently, the addition of butter, butteroil or fractionated dry butterfat to these products, which does not necessarily per se preclude the classifica­ tion of a product under heading 21.04, is of decisive importance in so far as it is capable of impairing the flavour-improving qualities of these products. Whether this is the case the appropriate national authorities must decide on the basis of all the factual data connected with the method of manufacture or the composition of the product in question.

8 The legal basis of Regulation No 241/70 is to be found in Regulation (EEC) No 97/69 which authorizes the Commission to adopt the measures necessary for uniform application of the nomenclature of the Common Customs Tariff as regards classification of goods, the purpose of such provisions being to give further details of the content of the headings or subheadings of the Common Customs Tariff without in any way amending the text thereof. A regulation adopted under Regulation No 97/69 is of a legislative nature and cannot have retroactive effect. Therefore, Regulation No 241/70 cannot be applied for the purpose of determining the classification of products imported before its entry into force.

9 It must therefore be answered that the classification of a product under head­ ing 21.04 of the Common Customs Tariff is precluded if the use of butter, butteroil or fractionated dry butterfat in the manufacture of the product impairs its direct suitability for improving the flavour of certain foods. It is for the competent national court to decide whether this is the case.

13 Accordingly, the entry into force of Regulation No 950/68 of the Council has not affected the legal effects of verbindliche Zolltarifauskünfte issued under Article 23 of the German Zollgesetz.

Costs

14 The costs incurred by the Government of the Federal Republic of Germany and the Commission of the European Communities which submitted obser­ vations to the Court are not recoverable and as these proceedings are, in so far as the parties to the main action are concerned, a step in the action pending before the national court, the decision as to costs is a matter for that court.

On those grounds,

Upon reading the pleadings; Upon hearing the report of the Judge-Rapporteur; Upon hearing the observations of the plaintiff in the main action, the Government of the Federal Republic of Germany and the Commission of the European Communities; Upon hearing the opinion of the Advocate-General;

GERVAIS-DANONE v HAUPTZOLLAMT MÜNCHEN

Dormer Monaco Pescatore

Delivered in open court in Luxembourg on 15 December 1971.

A. Van Houtte R. Lecourt Registrar President

OPINION OF MR ADVOCATE-GENERAL ROEMER

DELIVERED ON 14 DECEMBER 1971 1

Mr President, opinion today concerns questions with Members of the Court, which I have already dealt in Case 30/71. My preliminary observations may The request for a preliminary ruling on therefore be quite brief. which I am called upon to give an As you are aware, from 12 August 1968