C-11/73

1. Preliminary questions — Jurisdiction of the Court — Limits

(EEC Treaty, Article 177)

2. Agriculture — Common organization of the markets — Cereals — Common wheat and barley — Intra-Community levy — Calculation — Import costs —

Items to be taken into account (Regulation No 19 of the Council, Art. 2, Art. 4)

1. The Court is not enabled, in the import costs to be taken into account

context of Article 177, to apply the in calculating the amount of the levy Treaty to specific circumstances but are those which every importer must

Getreide-Import GMBH , Duisburg,

and

EINFUHR- Vorratsstelle Getreide FUTTERMITTEL , FRANKFURT- und FÜR und

am-Main,

1 — Language of the Case: German.

JUDGMENT OF 12. 7. 1973 — CASE 11/73

Advocate-General: J. P. Warner Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

I — Facts and procedure Following EVStG's rejection of this

protest by a decision of 12 January 1967, The facts and procedure may be Getreide-Import brought an action

or is such a deduction not required?' — the prohibition on the creation of

2. 'Getreide-Import GmbH', respresent­ obstacles to trade contained in ed by Karl Hinrichs, notary at Duisburg, Articles 18 and 21 of Regulation No the Federal Republic of Germany, 19/62, represented by Martin Seidel, acting as

agent, and the Commission of the — the principle of 'proportionality of

means', which in this case requires European Communities, represented by that fiscal considerations should not its legal adviser, Peter Kalbe, submitted be treated as decisive, written observations in accordance with

Article 20 of the Protocol on the Statute — finally the fact that, in the of the Court. circumstances under consideration, After hearing the report of the an importer's ability to make a profit Judge-Rapporteur and the opinion of the on the resale of imported goods is Advocate-General, the Court decided to diminished to the extent that not all open the oral procedure without any the import costs are taken into preparatory inquiry. account in the threshold calculating The Commission of the European price.

Communities made its oral observations

criteria that the costs of the following The observations submitted by items should have been taken into 'Getreide-Import GmbH', by the Federal account in this case by the German Republic of Germany and by the authorities:

Commission of the European Communi­

'Mandatory (Article 16 (2) security'

ties may be summarised as follows: —

of Regulation No 19/62). The granting of import licences being A Observations 'Ge­ — submitted by subject to the provision of a GmbH' treide-Import bank charges mandatory security,

relating thereto must form part of Getreide-Import submits that in fixing in the import costs. advance the rate of levy for the import licences in question the Federal Republic — 'Costs of examining plants', as

the decision of the Court in Case point of import (Emmerich), the cost 29/72 of 14 December 1972, amount of transport between these two

to 'taxes having equivalent effect to places should have been taken into customs duties', thereby being account. In the event, the German incompatible with the Treaty; the authorities calculated this cost in a

having authorities'

order to comply with purely arbitrary way, no

certain formalities, and the cost of so regard to the circumstances, doing are 'measures having equiva­ notwithstanding the fact that, within

lent effect to quantitative restric­ the Federal Republic, transport costs tions'. are the subject of public regulations

relevant documents (he 'net cash

payment on first presentation of documents' B — Observations submitted by the clause). Payment is made Federal Republic of Germany through a bank, the importer having to refund the expenses and to pay for The Federal Republic of Germany draws the bank's services. attention to the fact that in calculating the threshold price pursuant to — 'Financing of the purchase of the Regulation 19/62, the cost of marketing goods'. The price of the imported imported goods, as calculated from the goods being payable upon presenta­

most favourable point of entry (in the tion of the relevant documents and case of the Federal Republic: Emmerich), not being recoverable from the buyer up to the first wholesale marketing stage until after the arrival of the goods, in the area to which the basic target since throughout this period of time price applies (in the case of the Federal he must pay interest upon the

loaned him by bank Republic: Duisburg) should be deducted amount to the from the basic target price. for the purpose of making the

purchase. The costs to be deducted must of course be 'inevitable', since the threshold price — 'Control', as to weight, quality and cannot fall below the basic target price, other characteristics of imported and they should not be confused with cereals and upon which the final be those to taken into account for the calculation of their price is based. 'c.i.f.' 'free-at-frontier'

fixing of the or This examination, without which the price. buyer would lose his rights in relation to the is conducted However, since the threshold price is not supplier, calculated separately for each importa­ by specialised firms. tion, being fixed annually by the — 'Transport from Emmerich to Member States (Article 4 of Regulation Duisburg'. According to the No 19/62), it was impossible to take

of the goods', from the time of — 'Cost of mandatory security'; the payment to their arrival at

Cost of for frontier (Emmerich); examining —

plants',

the purpose of checking that — 'Cost of method of payment'. imported goods comply with the Regulation 19/62 is based upon legal provisions of the Law of 23 the principle that the import August 1957; occurs during the period of

— 'Cost of customs formalities', validity of the free-at-frontier these generally being conducted price (or the c.i.f. price). Costs by haulage firms for a standard incurred during such a short

fee; period are not inevitable. Overseas imports are subject to — 'Cost of transport from such costs, but since, for these Emmerich to Duisburg'; imports, the levy is generally — 'Turnover equalization tax'; fixed in it is not advance, possible to take them into — 'Cost of financing the purchase

account for the calculation of the States; free-at-frontier price; — 'Cost of certain operations

— 'Profit margin', having regard to connected with the results of the

the importer's profit and fixed examination of plants', some

import costs. Only import costs expenses (eosination) are not

should be covered in calculating involved in the import of cereals, this margin, not the costs of the and others (fumigation) are not

other stages of the necessary. marketing process.

being payable only in regard to account being taken of other factors —

special operations or those is equal to the basic target price less the work­ performed outside normal total marketing costs incurred from the ing hours; crossing of the frontier to the first stage of the Marketing process in the target — 'Cost of fumigation', being price area. Marketing costs to be necessary only for cereals

included in the calculations are not those infected with parasites; incurred in each caseit arises, (these as denaturing' — 'Cost of (eosination), being largely dependent upon decisions the quality and intended use of made by the importer), but are to be the cereals being immaterial for calculated at a flat rate, assuming the the calculation of the levy. most favourable circumstances, and only insofar as they prove to be 'inevitable'. (c) Import costs incurred between The Commission, having stated that the arrival at frontier the post 'inevitable' concept of costs does not (Emmerich) and the first stage of the necessarily correspond to that of costs in process (Duisburg). The marketing the context of 'commercial usage', following be taken as being may maintains that in this case only those such costs:

import costs arising between the frontier 'Cost from transport'

— of the post at Emmerich and the first wholesale frontier (Emmerich); marketing stage at Duisburg should be taken into account. Costs already — 'Cost of financing the purchase

considered in relation to the calculation of the goods'. This includes of the free-at-frontier (or c.i.f.) price, and items which could not all be those arising after the goods are put on taken into account (e.g. deposits sale at Duisburg, are not to be taken into made against operations in account. foreign exchange, expenses of

— 'Cost of mandatory security'; the various elements of cost of financing the purchase should not all be taken into — 'Turnover compensation tax'. account.

GETREIDE-IMPORT v EINFUHR- UND VORRATSSTELLE GETREIDE

Grounds of judgment

1 By orders dated 5 February 1973 and 18 June 1973, filed at the Court of Justice on 21 February 1973 and 22 June 1973 respectively, the Hessisches Finanzgericht referred, under Article 177 of the EEC Treaty a question on the

interpretation of Articles 2 and 4 of Regulation No 19 of the Council dated 4 April 1962 (P.I. 1962, No 30), concerning the gradual establishment of a common organisation of agricultural markets in the cereals sector;

2 The question is whether, in calculating the levy in accordance with the above

problems by the application of Community law raised to the specific

circumstances forming the subject matter of the main action;

However, the Court is not enabled under Article 177 to apply the Treaty to specific circumstances, and must therefore extract, from the wording of the

order the matter, those questions alone which relate to the referring interpretation of Community law;

The question may thus be understood as asking in general which items of

import costs must be taken into account when calculating the amount of the levy.

JUDGMENT OF 12. 7. 1973 — CASE 11/73

5 In order to avoid disturbances resulting from the import of low-priced goods, the threshold price provided by Regulation 19/62 was intended, by means of levies, to fix the level to which the price of the imported product must be raised to preclude its being offered for sale on the market in question at a

price lower than the basic target price;

To meet this condition the price of the imported product after crossing the

frontier had to be the same as the basic target price, and thus the threshold

price had to be equal to the basic target price less marketing costs;

Regulation 19/62 of the Council must be interpreted as meaning that the

items of import costs to be taken into account in calculating the amount of

the levy are those which every importer must inevitably incur in complying

with the procedures and legal formalities necessary for the import of the

products in question and in transporting those products to the first wholesale

marketing stage in the area to which the basic target price applies;

GETREIDE-IMPORT v EINFUHR- UND VORRATSSTELLE GETREIDE

On those grounds,

Upon reading the pleadings; Upon hearing the report of the Judge-Rapporteur;

Upon hearing the observations of the Commission of the European

Communities; Upon hearing the opinion of the Advocate-General; Having regard Treaty establishing European

European Economic the

European Communities;

THE COURT

in answer to the question referred to it by the Hessisches Finanzgericht (VIIth

Senate) by orders of that Court dated 5 February 1973 and 18 June 1973,

hereby rules:

Articles 2 and 4 of Regulation No 19/62 of the Council must be interpreted as meaning that the import costs which must be taken into

Registrar President