C-37/75

1. Regulation (EEC) No 97/69 of the the sole reservation that the provisions Council has conferred on the adopted by the Commission do not Commission, acting in cooperation amend the text of the Tariff. with the customs experts of the 2. Under Regulation (EEC) No 1709/74 Member States, a wide discretion as to of the Commission, cherries put up in the choice between two or more a mixture of water and ethyl alcohol headings which come into must be classified under subheading consideration with regard to the 20.06 B 1 of the Common Customs classification of specific goods with Tariff.

In Case 37/75

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

BAGUSAT KG and

BERLIN-PACKHOF

on the validity of Regulation (EEC) No 1709/74 of the Commission of 2 July 1974 (OJ L 180, p. 15) and on the interpretation of heading 08.11 and of subheading 20.06 B 1 of the Common Customs Tariff,

JUDGMENT

Facts

The facts of the case, the procedure and in brine, in sulphur water or in the observations submitted under Article other preservative solutions), but 20 of the Protocol on the Statute of the unsuitable in that state for Court of Justice of the EEC may be immediate consumption: summarized as follows: D. Other'; 20 Preparations of … fruit I — Facts and procedure 20.06 Fruit otherwise prepared or preserved, whether or not The undertaking Bagusat KG imports containing added sugar or spirit: cherries from Yugoslavia for the B. Other: chocolate industry. To ensure their I. Containing added spirit: provisional preservation during transport, e) Other fruits: the cherries are immersed in a flavoured 2. Other mixture of water and alcohol in Yugoslavia. This mixture, known in the Om 16 January 1973 the Bundes­ trade as 're-usable syrup', is removed finanzhof, Munich, in a preliminary from the cherries by draining and is opinion classified these products under re-used as far as possible by Bagusat KG tariff heading 08.11. to import fresh consignments of cherries. By Regulation (EEC) No 97/69 of the The main action is concerned with the Council on measures to be taken for question whether these cherries are to be uniform application of the nomenclature classified under tariff heading 08.11 or of the Common Customs Tariff (OJ, under tariff heading 20.06 of the English Special Edition 1969 (I) p. 12) Common Customs Tariff. since it was essential that the nomenclature of the Common Customs These headings appear as follows: Tariff be uniformly applied in all '08.11 Fruit provisionally preserved (for Member States and the adoption of example, by sulphur dioxide gas, provisions to that end at Community

level was necessary, a Committee on The provisions of Regulation (EEC) No Nomenclature was set up composed of 1709/74 are in accordance with the representatives of the Member States and opinion of the Committee on Common with a representative of the Commission Customs Tariff Nomenclature. as chairman. By a provisional decision of 11 The representative of the Commission September 1974 the Berlin-Packhof submits to the Committee a draft of the customs office, considering itself bound provisions to be adopted.

L 180, p. 15). According to the third binding in its entirety and which is recital of the preamble thereto: applicable in every Member State, amended neither the wording nor the 'Whereas the "Explanatory Notes" to the content of the Common Customs Tariff, Brussels Nomenclature make it clear that but simply defined the latter restrictively. the above-mentioned heading No 08.11 applies to fruit which has been treated By order of 25 March 1975 the solely to ensure its provisional Finanzgericht Berlin stayed the preservation during transport or storage proceedings and referred the following prior -to use, provided that it remains two questions to the Court in accordance unsuitable for immediate consumption with Article 177 of the EEC Treaty: in that state; whereas, consequently, this 'Are cherries, which are put up in a heading excludes fruit which has been mixture of water and ethyl alcohol and treated in a way which does not make it which were imported into the territory of unsuitable for immediate consumption.' Berlin (West) on 9 September 1974, to be classified under heading 08.11 of the

preserved, whether or not containing added sugar or spirit: The order making the reference was B. Other: registered at the Court Registry on 15 I. Containing added spirit.' April 1975.

Method of preservation The determining factor lies in consumer A comparison of the two subheadings practices in normal circumstances. In and their wording shows that only that respect, the Bagusat undertaking heading 08.11 is applicable, since all fruit produces an expert's report by the Director of the Bund für Lebens­ which is not provisionally preserved mittelrecht und Lebensmittelkunde. comes under heading 20.06. It is not the method of effecting preservation which is of decisive importance, but its purpose. Applicable rate of customs duty The cherries imported by the applicant were preserved only provisionally: Tariff heading 08.11 includes primary — a mixture of water and spirit was products which are preserved only added to them; provisionally for the length of transport — its strength was sufficient solely to time and are then processed finally by preserve the product during transport the national industry. Tariff heading 20.06, on the other hand, covers fruit and for a short storage period; — the alcohol content was kept at the which has been finally prepared and lower limit required to ensure preserved, has already been through all provisional preservation. the stages of processing and which, as products fit for consumption and The Bagusat undertaking quotes the generally ready for sale, may be Explanatory Notes to the Brussels despatched directly to the consumer.

BAGUSAT v HAUPTZOLLAMT BERLIN-PACKHOF

The does not correspond to the interpretation Court of Justice itself has not the power given to the tariff in certain Member to make a classification other than the States or that it was adopted in reaction classification prescribed. to decisions taken by national authorities Only if the Court rules that the and regarded as improper by the regulation is invalid may the exact Commission. In this case the regulation should not be annulled but the tariff classification of the cherries once more be the subject of discussion. classification, as applied in the Member State in question, should be revised. Since the objective of the regulations concerning tariff classification such as The only legal source of the regulations Regulation (EEC) No 1709/74 is not concerning tariff classification which are formal amendment of the nomenclature based on Regulation (EEC) No 97/69, is of the tariff and they decide exclusively Community law. Their validity can on the classification under a particular therefore be assessed solely in accordance tariff heading of the goods which they with the criteria laid down in the EEC describe, an amendment of the wording Treaty and by means of an independent of the tariff by means of such regulations analysis of the letter and the spirit of the could only be illegal if goods were Common Customs Tariff carried out classified under a tariff heading to which with the help of the binding rules of they clearly did not belong, in view of interpretation which it contains. the structure of the Common Customs Tariff and the definition of the heading The wording of tariff heading 20.06 in question. describes cherries put up in spirit with the help of three of their objective It is not sufficient that according to the characteristics; they must be wording of the tariff, a classification — fruit different from that laid down is — preserved conceivable or possible for it — with the addition of spirit. immediately to be regarded as an unacceptable amendment of the tariff Cherries however come under heading and an infringement of the enabling 20.06 only if they have been preserved or provision laid down in Regulation (EEC) prepared 'otherwise' than by one of the No 97/69 entailing the nullity of the methods prescribed in Chapter 8.

Spirit the decision which they contain is clearly is a traditional steeping agent intended

for the preservation of food and also fruit. according to these examples the From a strength of about 14 % to 16 % preservative must either be removed or of alcohol by volume onwards, micro reduced to safe quantities so as not to be organisms can no longer decompose the harmful to health before the goods are fruit and the fermentation process is put on sale. prevented. The resulting preservation is permanent, above all if it is reckoned The words used under tariff heading that fruit is not generally preserved for 08.11 as applied to daily practice mean ever but merely until its consumption at that the product cannot be consumed in the state in which it is because of the

consumption. It is impossible to remove from cherries What the Bundesfinanzhof did was to which are processed 'sweetmeats' all the replace the concept of 'suitable for alcohol in which they were preserved immediate consumption' by that of before they are processed, so that the 'intended for immediate consumption'. latter contributes decisively to their subsequent preservation until they are A product is described as 'intended for consumed. immediate consumption' when it is to be consumed in the state in which it already According to the wording of tariff is. On the other hand, it is described as heading 08.11 the latter refers only to 'suitable for immediate consumption' preserving processes, the application of when it may be eaten without danger, which makes cherries 'unsuitable for whether that is normal or not.

to health. This concept can only be used and semi-finished products, are used and in a nomenclature which is applied intended not for immediate consumption throughout the world such as the but for the manufacture of finished food Brussels nomenclature by being de products. scribed objectively in this way. Thus although the tariff concept 08.11 The Commission examines the examples does not include the cherries in question of preservatives mentioned under tariff in a manner which is completely clear heading 08.11.

BAGUSAT v HAUPTZOLLAMT BERLIN-PACKHOF

classification under tariff heading 20.06 1709/74 they must be classified under appears to be a priori and manifestly tariff subheading 20.06 B 1 of the indefensible, the Commission has not, by Common Customs Tariff. adopting Regulation (EEC) No 1709/74, exceeded the limits of the power of The Bagusat undertaking represented by interpretation which was conferred on it D. Ehle of the Cologne Bar and by Regulation (EEC) No 97/60. the Commission of the European Communities represented by its Legal In conclusion, the Commission suggests Adviser Peter Kalbe, acting as Agent, the following reply to the questions presented oral observations at the hearing referred for a preliminary ruling. on 6 October 1975.

'If cherries put up in alcohol are The Advocate-General delivered his imported into the Community after the opinion at the hearing on 22 October entry into force of Regulation (EEC) No 1975.

Law

1 By an order of 25 March 1975, received at the Court on 15 April 1975, the Finanzgericht Berlin requested the latter, under Article 177 of the EEC Treaty, to give a preliminary ruling on the validity of Regulation (EEC) No 1709/74 of the Commission of 2 July 1974 (OJ L 180, p. 15) and on the interpretation of heading 08.11 and of subheading 20.06 B 1 of the Common Customs Tariff.

2 The main action is concerned with the question whether cherries immersed in a mixture of water and alcohol in order to preserve them provisionally during transport to the Community and until, after draining, they are used for the chocolate industry in the Community, are to be classified under tariff subheading 20.06 B 1.

5 The second recital of the preamble to Regulation No 97/69 of the Council on measures to be taken for uniform application of the nomenclature of the Common Customs Tariff (OJ, English Special Edition 1969 (I) p. 12) explains that the provisions ensuring that the nomenclature is uniformly applied in all the Member States should specify the content of the headings or subheadings of the Common Customs Tariff, with the sole reservation that the provisions adopted by the Commission do not amend the text of the Tariff.

6 The regulation set up a Committee on Common Customs Tariff Nomenclature, specifying in the third recital of the preamble thereto that the provisions concerning the measures which may be necessary for classifying certain goods in the Tariff relate to a particularly technical field and that close cooperation is required between the Member States when drawing them up.

7 In this field, the Council has conferred on the Commission, acting in cooperation with the customs experts of the Member States, a wide discretion as to the choice between two or more headings which came into consideration with regard to the classification of specific goods.

8 It is necessary to consider whether the effect of Regulation (EEC) No 1709/74 has been to amend the text of the Tariff.

9 Although the terms of subheading 20.06 B 1 of the Common Customs Tariff are appropriate to cover the goods in question, nevertheless the chapter notes which according to the general rules for the interpretation of the nomenclature of the Common Customs Tariff are, together with the terms of the headings, determinative for legal purposes with regard to the classification of a product, state that Chapter 20 does not cover fruit prepared or preserved by the processes specified in Chapter 8.

No factor put forward by the plaintiff in the main action is such as to show that the Commission has exceeded the limits of the discretion conferred upon it.

12 Consequently it is necessary to reply to the national court that an examination of the question raised has not disclosed any factor such as to affect the validity of Regulation (EEC) No 1709/74 of the Commission and that under that regulation cherries put up in a mixture of water and ethyl alcohol must be classified under subheading 20.06 B 1 of the Common Customs Tariff.

Costs

13 The costs incurred by the Commission of the European Communities which has submitted its observations to the Court are not recoverable.

As these proceedings are, in so far as the parties to the main action are concerned, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court.

OPINION OF MR MAYRAS —CASE 37/75

Pescatore Sørensen Mackenzie Stuart O'Keeffe

Delivered in open court in Luxembourg on 11 November 1975

A. Van Houtte R. Lecourt

Registrar President

OPINION OF MR ADVOCATE-GENERAL MAYRAS DELIVERED ON 22 OCTOBER 1975 1

Mr President, On 9 September 1974 it submitted a Members of the Court, consignment of 30 barrels containing this product to the Berlin-Packhof The German limited partnership Bagusat customs office and stated in its KG imports from Yugoslavia cherries declaration that it came under heading intended for the chocolate industry. This No 08.11 of the Common Customs fruit is preserved in a flavoured mixture Tariff relating to 'Fruit provisionally of water and ethyl alcohol. preserved (for example, by sulphur