C-278/80

on the interpretation of tariff heading 35.06 of the Common Customs Tariff,

T H E C O U R T (Second Chamber)

composed of: O. Due, President of Chamber, A. Chloros and F. Grévisse, Judges,

Advocate General: S. Rozès Registrar: H . A. Rühl, Principal Administrator

gives the following

JUDGMENT

Naujoks, Koblenz-Bubenheim, the 35.06 "Prepared glues not elsewhere plaintiff in the main action, put into free specified or included; products suitable circulation until July 1974. According to for use as glues put up for sale by retail the order making the reference, the as glues in packages not exceeding a net product consists of a double-sided weight of 1 kg," attracting duty at a rate adhesive strip and a paper strip treated of 15.2 % . with silicone on both surfaces (lining paper). The paper strip is glazed or In its action before the Finanzgericht sprayed on one side with glue. The [Finance Court], the plaintiff claimed adhesive strip is used in such a way that that customs duties should be levied on the adhesive surface is applied to a sheet the basis of tariff subheading 40.05 C or of paper and the paper strip treated with 39.02 B, or alternatively on the basis of silicone is then peeled off. In that way subheading 35.06 A. the glue is completely detached from the paper strip and the paper requiring The plaintiff lodged an appeal with adhesion is pressed on to the glue with the Bundesfinanzhof [Federal Finance the result that the two sheets of paper Court] against the Finanzgericht's are joined together. The paper strip is decision dismissing its claim. therefore not bonded as well. The Bundesfinanzhof supports, in The product was initially classified in principle, the decision to classify the tariff heading 48.15 A of the Common product under heading 35.06 on the Customs Tariff "Other paper and ground that it must be classified paperboard, cut to size or shape: according to the material which Adhesive strips of a width not exceeding constitutes its essential property, namely 10 cm, the coating of which consists the adhesive strip stricto sensu which has of unvulcanized natural or synthetic the properties of glue. rubber", attracting duty at a rate of 6.5 % , and subsequently in subheading However, before it gave judgment the 40.05 C "Plates, sheets and strip, of Bundesfinanzhof referred the following unvulcanized natural or synthetic rubber, two questions to the Court for a pre- . . . C. Other", attracting duty at a rate liminary ruling: of 4 % . "A. Is tariff heading 35.06 of the As a result of an opinion given by the Common Customs Tariff to be Staatliche Materialprüfungsamt Nord¬ interpreted as also including a rhein-Westfalen [National Material product described as 'adhesive paper Examination Office, North Rhine- strip' or as 'strip, of unvulcanized Westphalia] and of a report drawn up by synthetic rubber' wound on to a the Zolltechnische Prüfungs- und Lehr- spool and consisting of a double- anstalt [Customs Laboratory and sided adhesive strip and a strip of Training College] Hamburg-Atlona, the paper (treated with silicone) product was classified under tariff sub- separating the adhesive strips which heading 39.02 C XII "Polymerization have been rolled up and which is and co-polymerization products (for used in such a way that the paper example polyethylene . . .): . . . C. Other: strip is peeled off and therefore does Acrylic polymers, methacrylic polymers, not adhere when the double-sided . . .," attracting duty at a rate of 16.8 % . adhesive strip is applied?

Upon hearing the report of the Judge- Rapporteur and the views of the C. Other." Advocate General, the Court decided to open the oral procedure whilst request- The Notes relating to Chapter 40 ing the plaintiff and the Commission to provide, inter alia: reply before the sitting to the questions set out below. " 1 . . . . throughout the Tariff the expression 'rubber' means the By order of 17 June 1981, the Court following products, whether or not decided, pursuant to Article 95 (1) of the vulcanized or hardened: natural Rules of Procedure, to assign the case to rubber, balata, gutta-percha and the Second Chamber. similar natural gums, synthetic rubber, ...

II — T h e r e l e v a n t p r o v i s i o n s 4. In Note 1 to this Chapter and in The General Rules of the Common headings Nos 40.02, 40.05 and Customs Tariff provide 40.06, the expression 'synthetic rubber' is to be taken to apply to : "... (a) Unsaturated synthetic substances 3. When for any reason, goods are, which can be irreversibly trans- prima facie, classifiable under two or formed into non-thermoplastic more headings, classification shall be substances by vulcanization with effected as follows: sulphur and which, when so vulcanized as well as may be (a) The heading which provides the (without the addition of any most specific description shall be substances such as plasticizers,

CHEM-TEC v HAUPTZOLLAMT KOBLENZ

B. Adhesive strips of a width (b) Other not exceeding 10 cm, the coating of which consists II. Other glues of unvulcanized natural or synthetic rubber . . . B. Products suitable for use as glues put up for sale by C. Other: retail as glues in packages not exceeding a net weight of 1 kg" XII. Acrylic polymers, methacrylic poly- mers and acrylo¬ As far as the packaging is concerned, the methacrylic co-poly- Explanatory Notes to the Customs mers ..." Cooperation Council Nomenclature specify that: The Notes relating to Chapter 39 provide that: "The packages in which glues are usually put up for sale by retail include glass " 1 . This Chapter does not cover: bottles or jars, metal boxes, collapsible metal tubes, cartons, paper bags, etc.; sometimes the 'packaging' is merely a (c) Synthetic rubber, as defined for paper band wrapped round, for example, the purposes of Chapter 40, or a slab of bone glue. A small brush of the articles thereof; appropriate type is sometimes packed

JUDGMENT OF 11. 2. 1982 — CASE 278/80

Those Notes a constant thickness of 0.05 mm, without clearly indicate that Chapter 39 does not any backing. It is adhesive on both sides include: "(e) Synthetic rubber as defined and is utilized in the manufacture of in Note 4 to Chapter 40, and articles paper, for example endless sticking thereof". Consequently, the double-sided together two continuous sheets of paper, transferable adhesive strip at issue in the for glueing together continuous sheets present case is covered not by Chapter of aluminium, a process used in the 39 but by Chapter 40 of the Common furniture industry to join together Customs Tariff because it is more ornamental mouldings, and it is used on accurately described in the latter other occasions when the adhesive strip inasmuch as the strip is of synthetic to be applied must not be thickened rubber within the meaning of Chapter unnecessarily by the addition of backing. 40, in the form authorized thereunder. The adhesive strip is supplied, according Thus only subheading 40.05 C in to requirements, in different widths and Chapter 40 contains a more accurate lengths, for example it may be exactly description of the product and confir- 12 mm wide (for joining together mation that "Scotch 465" is covered by ornamental mouldings, for example) and that Chapter is to be found in the Expla- 914 metres long or it may be supplied in natory Notes relating thereto.

purposes. Only adhesive strips may be The Notes relating to Chapter 40 are used for such purposes because the glues contradictory. Heading 40.05 expressly mentioned in heading 35.06 are not covers only unvulcanized rubber supplied in constant widths, lengths or provided that, as is stated in Note 4, it thicknesses but in tubes or barrels, for displays certain features following example. vulcanization. In the plaintiff's opinion, It follows, according to the plaintiff, that therein lies a contradiction.

CHEM-TEC v HAUPTZOLLAMT KOBLENZ

The latter cannot be Note 4, with the result that, in any regarded as a package within the event, the evidence yielded by an exami- meaning of heading 35.06 B. That is nation serves no purpose: see the notes confirmed by the list of receptacles (glass to the Customs Cooperation Council bottles or jars, metal boxes or tubes, Nomenclature relating to heading cartons and paper bags) set out in the 40.02 A. (2): "The synthetic substances Explanatory Notes to the Customs having these characteristics include:

The adhesive strips even though it does not contain any could also be delivered wound round an heading encompassing such strips in general terms, includes them in several unmarked non-adhesive core, that is to headings but takes account on each say a simple white paper bound core and occasion of their material quality and the description of the article would their use. appear on the label affixed to the outside of the carton, together with other Relying on the description of the indications relating to width and length product in the order making the and the directions for use.

adhesive strip. The various rolls placed in a carton are not packed in individual Second question folding boxes or in another wrapper or package. Such a carton weighs between 1. The plaintiff contends that recourse 8 and 16 kg, including the contents. to subheading 35.06 B leads to an

With regard to that point too, the " 1 . In view of the fact that subheading plaintiff proposes that the question 35.06 A covers prepared glues not should be answered in the negative. elsewhere specified or included and that subheading 35.06 B covers products suitable for use as glues put up for sale by retail as glues in 2. The Commission emphasizes first of all that there are no legal provisions in packages not exceeding a net weight the Common Customs Tariff on that of 1 kg, the plaintiff in the main point. The Explanatory Notes to the action and the Commission are Customs Cooperation Council N o - requested to state their views on the menclature must be interpreted broadly. relationship between the two subh- The example of the slab of bone glue eadings as regards the products in wound round with a simple paper question and on the question wrapper shows that not only packages in whether and, as the case may be, to the strict sense of the word, such as glass what extent the substances listed in bottles or jars, metal or cardboard boxes, headings 39.02 C XII and 40.05 may paper bags etc., but also materials used themselves be described as 'prepared in certain specific cases as wrapping may glues'? be regarded as packages. 2. The plaintiff in the main action is requested to state its views on the The expression "put up for sale by retail following two questions: in packages not exceeding a net weight of 1 kg" in heading 35.06 should be (a) Is it possible to manufacture, interpreted as including goods which are using the substances referred to identifiable as being intended for sale in headings 39.02 C XII and directly to consumers without further 40.05, products for use as glues packaging. put up in ordinary packages such as bottles, jars, boxes, tubes etc? The Commission therefore proposes that (b) Have the rolls of adhesive strip the second question should be answered imported by the plaintiff or by as follows: others actually been sold by retail and if so, in what quantities. If they have, could The expression "put up for sale by retail the rolls be sold individually or . . . in packages not exceeding a net were they sold exclusively in weight of 1 kg" in subheading 35.06 B cartons? must be interpreted as including adhesive strips which are wound on to a spool and all identifiable as being intended for 3. Can the Commission supply the sale directly and without further Court with information on the packaging." position adopted by the custom authorities of the other Member States on the classification for tariff purposes of the products in question and on the reasons for that IV — Q u e s t i o n s p u t by t h e C o u r t position?"

specified in heading 39.02 C XII are arti- stances referred to in that subheading as ficial thermoplastic materials which are adhesive substances which are, moreover, light-resistant and weatherproof, often put up in ordinary containers, for transparent (such as plexiglas) or also, example, bottles, jars, boxes, tubes etc. for example, suitable for being woven in the form of fibres (orlon). None of these Similarly, Question (2) (a) relating to factors applies to the case of the adhesive tariff heading 40.05 calls for a negative

Liquids or pastes: these may be state what is to be understood by the basic plastic material which requires synthetic rubber. 'curing' by heat or otherwise to form the finished material, or may be emulsions, At the same time, Chapter 40 covers all dispersions or solutions of the uncured the varieties of rubber falling within its or partly-cured materials". terms only if they take certain forms, for example, slabs, sheets or strip and not if The same Notes state in the second they are in a liquid state, in lumps or in paragraph of the General Considerations other similar forms. relating to Chapter 39:

As a 40.05 as well as by the explanatory notes finished adhesive strip, the product is in and the notes relating to that heading. its final state, and cannot be softened by heat or shaped and its use does not In the figurative though not in the broad depend on its being heated. Therein sense, "Scotch 465" is admittedly a glue, lies the important and fundamental (a glue) of synthetic rubber covered by difference between the strip and the subheading 40.05. A "glue" of that kind, substances covered by Chapter 39 that is to say an adhesive strip of that (39.02 C XII), regardless of the fact that kind (such as "Scotch 465") cannot, from a chemical point of view, acrylic however, be packed in tubes, jars, bottles or acrylatic glues constitute rubber or boxes since it cannot be introduced products. into such receptacles and, even on the

JUDGMENT OF 11. 2. 1982 — CASE 278/80

Such perties relevant to its classification for impurities would undoubtedly appear, if tariff purposes. the adhesive strip were sold in individual rolls or in bulk, for example when they The latter point also constitutes an are sold from the shelf. The articles are answer to the first question which seeks therefore sold in the closed receptacles in to ascertain whether the substances listed which they are supplied, that is to say in in tariff heading 40.05 may be described, specific quantities put up in different as such, as "prepared glues". That cartons according to their width and description is out of the question both length. from the chemical point of view and from that of the Common Customs As far as the industrial use of the Tariff and its explanatory notes. adhesive strip is concerned, the sale of the product in the form of rolls is out of With regard to the first part of the first the question since in most cases larger question, the plaintiff refers to the quantities are bought and used every above-cited explanatory notes relating to time. subheading 35.06 B and contends that It would be quite unusual and absolutely the glues mentioned therein cannot impossible to market an adhesive strip by include adhesive strips, particularly since weight since the latter is of no the glues covered by heading 35.06 may importance and only the width and the also be applied by using a brush which is length are relevant.

layer. It must immediately adhere firmly possible) to be covered by those tariff to the precise place on the specific width headings.

General (Chapter 39) V — Oral procedure

"6. ... At the sitting on 12 November 1981, oral argument was presented by the The chapter also exludes: following: H. Ditges, "Rechtsanwalt, Bonn, für Chem-Tec B. H. Naujoks; R. Wägenbaur, Legal Adviser to the Commission of the European (d) Preparations specifically formulated Communities; acting as Agent, assisted for use as glues, consisting either of by T. van Rijn, a member of the a mixture of several artificial plastic Commission's Legal Department, and by materials falling individually within Mr Straub, for the Commission. Mr different headings of the present Naujoks, owner of the undertaking Chapter, or of artificial plastic Chem-Tec and his employee Mrs Walta materials which, apart from any replied to questions put to them by the permitted additions to the products Court. of this Chapter, contain other added substances not falling in Chapter 39 The Advocate General delivered her (e.g., waxes). These are classified in opinion at the sitting on 17 December heading 35.06 as are products of 1981.

JUDGMENT OF 11. 2. 1982 — CASE 278/80

Decision

1 By order of 11 November 1980, received at the Court on 15 December 1980, the Bundesfinanzhof [Federal Finance Court] referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty two questions on the interpretation of tariff heading 35.06 of the Common Customs Tariff which is worded as follows:

"35.06 Prepared glues not elsewhere specified or included; products suitable for use as glues put up for sale by retail as glues in packages not exceeding a net weight of 1 kg:

2 The questions have arisen in connection with a dispute between the competent customs authority and a German undertaking, which from October 1973 until July 1974 put into free circulation in the Federal Republic of Germany a product known as "transferable adhesive strips", having the trade-name "Scotch" and the serial number 465.

3 It is clear from the order making the reference to the Court that the product in question consists of an adhesive layer which is pressed on a strip of paper treated with silicone on both sides and which is wound, together with the strip of paper, on to a cardboard spool. When it is used, the adhesive layer is applied, with the aid of the paper strip, to one of the surfaces requiring adhesion, then the paper strip is peeled off and the other surface requiring adhesion is pressed on to the adhesive layer formerly protected by the paper strip. Thus the paper strip serves as the necessary backing for the adhesive layer when the latter is manufactured, as a material for protecting and

CHEM-TEC v HAUPTZOLLAMT KOBLENZ

isolating the layer until it is used, and as a technical means for applying the layer on the first surface requiring adhesion, but it is not used in the actual process of joining the surfaces together.

4 Initially, the goods were classified, in accordance with the declarations made by the importing undertakings, as " adhesive paper strip the coating of which consists of unvulcanized synthetic rubber" falling within subheading 48.15 A and, subsequently, as " strip, of unvulcanized synthetic rubber" falling within subheading 40.05 C. After it had commissioned a number of expert studies of the product, the customs administration amended its decisions relating to classification and applied first subheading 39.02 C XII ("Polymerization ... products ...: Acrylic polymers . . ") and finally subheading 35.06 B referred to above.

JUDGMENT OF 11. 2. 1982 — CASE 278/80

weight of 1 kg' in tariff subheading 35.06 B to be interpreted? Does the product described in Question A fulfil those conditions by reason only of the fact the the glue along the whole length of the adhesive strip is joined to a paper strip with the result that the latter can be regarded as a package, or must the adhesive strips within the required weight limit be contained in special packages and in addition be marked as glue by written indications?"

First question

7 In its first question, the Bundesfinanzhof asks, in substance, whether the customs authorities have applied the Common Customs Tariff correctly by basing their final decision on classification for tariff purposes not on the characteristics of the paper strip but on those of the adhesive layer, and not on the chemical composition of the latter, as requested by the plaintiff, but by reference to its function.

8 According to Rule 3 (a) and (b) of the General Rules for the Interpretation of the Nomenclature of the Common Customs Tariff, when the goods are prima facie classifiable under two or more headings, the heading providing the most specific description must take precedence and goods consisting of different materials must be classified by reference to the material which gives them their essential character.

Second question

1 1 In its second question, the Bundesfinanzhof asks, in the first place, whether the strip of paper wound, together with the adhesive layer, on to a cardboard spool may be considered as a product put up in a package within the meaning of subheading 35.06 B of the Common Customs Tariff or whether the application of that subheading presupposes that the rolls are placed in special packages.

12 For the purpose of the reply to the first part of the second question, it is necessary to begin by considering the scheme of heading 35.06. As in the case of other tariff headings, heading 35.06 is subdivided into a general subheading (35.06 A) and a specific subheading (35.06 B) which relates to products put up for sale by retail and makes them subject to a higher rate of duty than that levied on imported products which are to be sold directly to consumers and therefore require further packaging after they have been put into free circulation. In that regard, the fact that an imported product is, as the plaintiff maintains, normally used in industry and that in consequence is not offered for sale by retail, is not of decisive importance. The subheading providing the most specific description remains applicable if the product is objectively suitable, given the form in which it is presented, for sale by retail, without further packaging.

1 3 In the light of those considerations, the concept of "package" must be given a wide interpretation if, from every other point of view, the product is suitable for direct sale to the consumer, without any further packaging.

17 Moreover, the plaintiff has contended before the Court that the paper strip is inadequate for the purpose of protecting the adhesive layer against any impurities which may cling to its edges and that such impurities reduce the effect of adhesion and may render the glued product unusable. For that reason, the rolls are not suitable for being sold separately but solely in cartons such as those in which the product has been imported, each of which contains a large number of rolls. That attests to the product's use for industrial purposes. Thus, in order to be sold by retail, the product requires further packaging.

18 Since those arguments were not, according to the documents in the file on the case produced before the Court, put forward in the proceedings before

CHEM-TEC v HAUPTZOLLAMT KOBLENZ

the national court and since the facts on which the plaintiff seeks to found these arguments are not included amongst those set out by the Bundes- finanzhof in the questions which it has referred to the Court for a pre- liminary ruling, it will be for the national court, if appropriate, taking into account the criteria for interpretation provided by the Court of Justice, to rule on the validity of the arguments as well as on any other matters of fact, such as the net weight of the rolls, not raised in the questions submitted for a preliminary ruling.

19 Accordingly, the answer to be given to the first part of the second question is that the expression "put up for sale by r e t a i l . . . in packages not exceeding a net weight of 1 kg" in subheading 35.06 B is to be interpreted as meaning that the paper strip described above may be considered a package but that the classification of the rolls in that subheading presupposes that they are suitable for sale by retail without any additional packaging and that the net weight of the rolls, that is to say the weight of the adhesive layer, does not exceed 1 kg.

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

On those grounds,

T H E C O U R T (Second Chamber),

in answer to the questions referred to it by the Bundesfinanzhof by order of 11 November 1980, hereby rules:

1. Tariff heading 35.06 of the Common Customs Tariff must be interpreted as also including a product described as "adhesive paper strip" or as "strip, of unvulcanized synthetic rubber" wound on to a spool and consisting of a double-sided adhesive strip and a strip of paper (treated with silicone) separating the adhesive strips which have been rolled up and which is used in such a way that the paper strip is peeled off and therefore does not adhere when the double-sided adhesive strip is applied.

2. The expression "put up for sale by retail... in packages not exceeding a net weight of 1 kg" in subheading 35.06 B is to be interpreted as meaning that the paper strip described above may be regarded as a package but that the classification of the rolls in that subheading presupposes that they are suitable for sale by retail without any additional packaging and that the net weight of the rolls, that is to say the weight of the adhesive layer, does not exceed 1 kg.