C-266/81

SOCIETÀ ITALIANA PER L ' O L E O D O T T O TRANSALPINO ( S I Ó T ) , w h o s e registered office is in Trieste,

and

MINISTERO DELLE F I N A N Z E [Ministry of F i n a n c e ] , M I N I S T E R O DELLA MARINA MERCANTILE [Ministry of Shipping], CIRCOSCRIZIONE DOGANALE DI T R I E S T E [Trieste customs a u t h o r i t y ] A N D E N T E A U T O N O M O DEL P O R T O DI TRIESTE [Trieste independent p o r t a u t h o r i t y ] ,

and also in six other actions, joined thereto, which involve t h e same parties or some of them, in main actions, cross-appeals a n d interlocutory proceedings,

on t h e jurisdiction of the C o u r t of Justice t o interpret the General A g r e e m e n t on Tariffs a n d T r a d e ( G A T T ) , t h e effects of t h e substitution of t h e

SIÓT v MINISTERO DELLE FINANZE

Facts and Issues

The facts of the case, the course of the 23. 2. 1963), a State charge (revenue procedure and the observations sub- charge) was imposed on the unloading of mitted pursuant to Article 20 of the goods from abroad in the State's ports, Protocol on the Statute of the Court of roadsteads and wharves pending Justice of the European Economic permanent or temporary importation Community may be summarized as and, by Articles 33, 34 and 35, a charge follows: (port charge) was imposed on goods unloaded or loaded in specified ports, including Trieste. I — Facts and written procedure

By Article 27 of Italian Law No 82 of 9 February 1963 (Gazzetta Ufficiale of

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The Company challenged the levying of According to the second paragraph of those charges, which it considers to be Article 2, there is to be no change in the contrary to Community law, to GATT port charge on goods loaded or and to certain provisions of Italian unloaded in the ports referred to in Law national law, before the local court and No 82 of 1963. later before the Corte d'Appello [Court of Appeal], Trieste. Not having According to the first part of the third succeeded either at first instance or on paragraph of Article 2, the amount of appeal, it appealed against judgments of

SIÓT v MINISTERO DELLE FINANZE

JUDGMENT OF 16. 3. 1983 — CASE 266/81

of which the Court of Justice has relations between parties, and, if the jurisdiction to give a preliminary latter is the case, has GATT the ruling under Article 177 of the same status as, or greater status Treaty, even where the national than, the conflicting national court is requested to apply them or provisions? to interpret them with reference to relations between parties for purposes other than that of determining whether or not a Community measure is valid? (C) If an affirmative reply is given to Question A and whatever the reply to Question B, with a view to providing the national court with guidelines relevant to the interpret- ation of the national provisions:

(B) If the foregoing question is answered in the affirmative:

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JUDGMENT OF 16. 3. 1983 — CASE 266/81

2. If the imposition of such charges Upon hearing the report of the Judge- is prohibited, has an individual a Rapporteur and the views of the right of action before the national Advocate General, the Court considered, courts to recover the sums paid in having regard to the written observations respect thereof or to oppose the submitted to it, that additional infor- claim for payment made by the mation was required on several points. State? Consequently it requested the parties to the main action, the Member States or the Commission, as appropriate, to reply in writing before the opening of the oral The order of the Corte Suprema di procedure to certain questions and to Cassazione was lodged at the Court provide certain supplementary infor- Registry on 6 October 1981. mation.

SIÓT v MINISTERO DELLE FINANZE

JUDGMENT OF 16. 3. 1983 — CASE 266/81

SIÓT v MINISTERO DELLE FINANZE

Thus The Court's jurisdiction in matters of it has no jurisdiction to give a ruling on interpretation, as defined in Article 177 the interpretation of provisions of of the EEC Treaty, relates to GATT, in so far as they impose Community law in its entirety. According obligations only on the Member States. to the case-law of the Court, the Community, which has been substituted for the Member States, is legally bound The Government of the Kingdom of the by the provisions of GATT. Netherlands considers that it is necessary to determine whether GATT may be regarded as forming part of Community There is scarcely any substantive reason law within the meaning of Article 164 of militating in favour of the distinction

not called in question. Considerations may form part of Community law, in so relating to the common customs and far as they are capable of direct commercial policy also support that application and may "influence" argument. relations within the Community, without requiring the adoption of any legal measure for that purpose. From all these circumstances, in particular the fact that GATT relates to a sphere in which the Member States Article 228 (2) of the EEC Treaty, which have progressively transferred powers to provides that international agreements the Community, it seems justified to concluded by the Community are to be accept a special solution, which cannot binding on the institutions of the be applied as such to other international Community, applies mutatis mutandis to agreements falling within the scope of the preparation of decisions which bind Article 234. the Community in the framework of

JUDGMENT OF 16. 3. 1983 — CASE 266/81

If the Community is bound by an inter- The Commission points out that Articles national agreement and if the provisions 228 (2) and 5 of the EEC Treaty impose of that agreement which must be an obligation on the Member States to specifically relied upon have a direct respect the agreements concluded by the effect on relations within the Com- Community and assist in their munity, the provisions in question may implementation; that obligation cannot be regarded as forming part of but be of a Community nature, in so far Community law and must therefore be as its basis and its content are concerned. interpreted and applied by the Court of Justice.

The jurisdiction of the Court to interpret a particular provision of an international agreement cannot be made conditional upon the existence of a measure of Community law. The substitution of the Community for the Member States in the fulfilment of commitments arising out of GATT creates a situation in the Community legal order comparable to that in which According to the United Kingdom, there an international agreement was originally is no doubt that the Court has concluded by the Community itself. jurisdiction under Article 177 to give GATT must therefore be treated as an preliminary rulings not only on whether act of the institutions of the Community Community measures are compatible within the meaning of subparagraph (b) with the provisions of international law of the first paragraph of Article 177. The which are binding on the Community internal effect of GATT may not depend but also on the meaning and effect in the on the legal system of each of the Community's legal order of such Member States; it would be inconsistent provisions of international law as GATT, and illogical to permit the provisions of so that national courts may correctly and GATT to have an effect in the uniformly deal with such provisions in Community differing according to the cases before them. legal system of each of the Member

SIÓT v MINISTERO DELLE FINANZE

JUDGMENT OF 16. 3. 1983 — CASE 266/81

SIÓT v MINISTERO DELLE FINANZE

Parties certainly did not originally intend of the Member States might apply the to confer on GATT direct effect under rules of GATT in cases in which they national law. Within the framework were relied upon in order to challenge a defined by GATT, there is no judicial national legal measure; however, it seems procedure for the settlement of disputes: necessary, in that regard, that the Court disputes are settled by means of of Justice should be able, when reference negotiations. The GATT "system of is made do it under the procedure laid sanctions" was intended rather to down in Article 177, to provide the maintain a balance between the national court with the necessary reciprocal rights and obligations of the guidance concerning the interpretation parties. of the rules in GATT.

When the effect of an international The need for the uniform application of agreement is considered, the ordinary Community law would not really be meaning must be given to the terms of prejudiced by the fact that, in the treaty in their context and in the accordance with national law, the courts light of its object and purpose. In several

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of its judgments, in particular in its In interpreting a provision of GATT, the judgment of 12 December 1972 in Joined court of one Contracting Party might be Cases 21 to 24/72 (International Fruit v induced to give to it a wider scope than Produktschap voor Groenten en Fruit that which the Contracting Parties [1972] ECR 1219), the Court stated that attribute or might be induced to attribute the provisions of GATT are not capable to it; judicial interpretation relates to a of conferring on citizens of the subject which the signatories of GATT Community rights which they may left to subsequent bilateral or multilateral invoke before the courts. negotiations or to questions capable of being settled by a procedure for the settlement of disputes, which also includes negotiation.

To give direct effect to a treaty such as GATT would lead to wholly undesirable results which were not intended by the parties thereto: the consequence would be unilaterally to enlarge the EEC, so far C — The assessment of the contested as Member States only are concerned, to charges by reference to Article V (3) countries which have not accepted the of GATT obligations inherent in membership of the EEC.

SIÓT v MINISTERO DELLE FINANZE

compatibility of the contested charges the unloading or loading involves with Article V (3) is of no interest in the domestic goods. main action.

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The rules contained in GATT from all transit duties or other charges concerning transit are therefore in no imposed in respect of transit. The way affected by a national fiscal expression "transit duties" clearly means provision which does not apply to transit charges imposed specifically and as such and does not apply to goods in exclusively by reason of transit; the transit treatment different from that of phrase "all . . . other charges imposed in domestic goods which are in circulation respect of transit" seems from the text to within the territory or foreign goods relate to taxation the chargeable event of intended for importation or even which is transit. domestic goods intended for exportation.

The wording of paragraphs (3), (4) and According to the Government of the (5) of Article V shows that the Federal Republic of Germany, the obligations of the Contracting Parties are collection of a charge which does not situated in the sphere of customs and constitute the consideration for any administrative procedures; the taxation service on crude oil unloaded in the port referred to in Article V is linked to the of Trieste and intended for the German specific customs and administrative pro- market constitutes a clear infringement cedures connected with transit, so that of Article V (3) of GATT; however, the taxation which has only an incidental Court's jurisdiction in matters of inter- connection with transit does not fall pretation does not extend to such a within that provision. ruling.

SIÓT v MINISTERO DELLE FINANZE

of the imposition of taxation on goods in in transit — is incompatible with free transit or, at least, an obligation to. movement or with competitive equality. relieve them of such taxation once they are exported to other Member States. The Community transit procedure does not seek simply to make it unnecessary Conduct which infringes the provisions in each country crossed to carry out of GATT is also contrary to the formalities for importation on entry and provisions of the EEC Treaty on the free for exportation on exit; it has a far more movement of goods; the obligations important objective, namely to avoid the which the Member States have collection of internal taxation on impor- undertaken in the framework of the EEC tation and the refund of such taxation on may not be less than those imposed by exportation. GATT.

The product in transit is not in fact an The fact that the Corte Suprema di imported product; by definition, the Cassazione asks the Court generally product in transit is not brought on to about the possible conditions and limits the national territory for consumption, which are imposed by Community law but is only in passage across that on the export arrangements in question territory. enables it to give a different and wider meaning to the questions which have been put to it. A charge on goods in transit has the effect of a customs duty even if it is a form of internal taxation. Common commercial policy (Article 113)

and their effect is to distort the countries, provided for in Article 111 (1) uniformity of the level of external of the Treaty, has been only partial, and protection; they are therefore incom- the Court has itself referred to the fact patible with the requirements of the that at the end of the transitional period common commercial policy, which the Community commercial policy was according to Article 113 (1) of the EEC not fully achieved. Treaty is based on uniform principles and to which the introduction of the Common Customs Tariff gave specific application. The powers of the Community are not sufficient by themselves to achieve common rules with regard to commercial policy; they must in addition be According to the Trieste Port Authority, exercised. The content of those rules the contested charges are part of a must first be fixed by the Community general system of internal taxation, institutions and, as long as no instituted in the exercise of the inherent Community measure has been adopted, and exclusive fiscal sovereignty of the the Member States must be empowered national legislature and payable not by to retain national measures. The Court reason or on the occasion of impor- has itself held that it is in each case a tation, but because of the fact of the matter for the Commission or the unloading or loading of goods. Council to assess the need for eliminating national disparities in the fields of taxation and commerce affecting trade with non-member At present, in the absence of Community countries and that the reduction or measures for the harmonization of elimination of existing charges on goods unloading charges, the obligation to base imported directly from non-member the common commercial policy on countries is a matter for the institutions "uniform principles" may not be of the Community; therefore there can regarded as precluding the system of be no question of incompatibility with taxation in question in the main action, Article 113 (1) where, as in this case, the particularly since that obligation was subject of discussion is a general system emphasized in Article 113 (1) of the of internal taxation falling within the EEC Treaty by reference to questions exclusive competence of the national unrelated to internal taxation. Even if it legislature. may be considered that the contested system of taxation has some effect on the common commercial policy, it is in any event a question falling within the The Government of the Italian Republic competence and the initiative of the considers that the contested taxation Community institutions, since individuals cannot, by reason of its very nature and may not avail themselves directly of having regard to the purpose laid down Article 113 (1) of the Treaty. in Article 110 of the Treaty, affect the common commercial policy.

In the framework of these proceedings, it is not necessary to define the charges in The contested charges do not constitute question with regard to Community law. protectionist measures and do not fall So far as "measures of commercial within the category of customs duties. policy" within the meaning of They do not lay down any special Community law are concerned, they conditions which discriminate against should be evaluated essentially according undertakings of one Member State in to their special character as an relation to similar national undertakings, instrument for the regulation of inter- since they are applied in an equal and national trade, regard being had to the uniform manner, in relation to the port link established by the Treaty between movements of the various goods, to the abolition of trade barriers between every user of national ports, whether Member States and the implementation Italian or foreign, public or private. of a common commercial policy. In any event, in view of the criterion that such measures have the character of instru- ments and the objective pursued, charges With regard to port movements relating such as those in question in the main to crude oil from non-member countries, action are not, in the light of the it should be stated that Italy is itself a case-law of the Court, part of country which imports oil and that its commercial policy. imports are not exempt from the contested revenue and port charges; furthermore, the incidence of those However, without actually having the charges is minimal (0.1%, for the character of an instrument for regulating revenue charge, and 0.18%, for the p o n international trade, a national measure charge, in relation to the average cost of may harm the proper working of the oil at the material time). system of the common commercial policy or jeopardize the achievement of its objectives. In that regard, it should be stated that charges such as the contested The Commission points out that there are charges fall within the category of the two aspects to the question whether the taxation referred to in Article 95 et seq. contested charges are incompatible with of the Treaty, whose unilateral intro- Article 113 of the Treaty: that of duction after the Common Customs

Tariff has been introduced is not general principles of the EEC Treaty. It prohibited. Moreover, they are not is limited, it is true, to determining the discriminatory in character and no formal aspects of the procedure, without provision of the general rules on the laying down any substantive rules common commercial policy contains any relating thereto; however, it is clear that express prohibition such as those a purely "documentary" transit pro- appearing in Article 95 et seq. Therefore, cedure of that kind would have no raison charges such as revenue and port charges d'être if it had no fiscal effects. on unloading and loading are not prohibited by the rules n the common commercial policy. The Trieste Port Authority states that, according to Article 12 (1) of Regulation No 542/69 (and of Regulation No In the framework of this dispute it is not 222/77), any goods which are to be possible to give a satisfactory reply to the carried under the procedure for external question whether such charges are Community transit must be covered, in incompatible with the rules on the accordance with the conditions laid common commercial policy inasmuch as down in the regulation, by a T 1 they harm its proper functioning or declaration; that is not the case with the jeopardize the achievement of its petroleum products in question in the objectives. In order to determine whether main action. those charges are incompatible with the common commercial policy and whether the Member State is obliged to eliminate them, it is first necessary to assess a In any event, it must be remembered that whole range of factors in the nature of the rules on Community transit do not economic and commençai policy. Since concern or in any way alter the such charges do not appear to be treatment of goods for customs and tax incompatible with the functioning of the purposes and have no effect on the common market, it is difficult to imagine obligation to pay any duties and other that they may constitute an obstacle for taxes which may be chargeable. They commercial policy with regard to non- concern only the formalities and pro- member countries. cedures laid down, in particular for stat- istical purposes, for the movement of goods between two points situated in the Community; they contain only provisions of a procedural nature. The Community transit procedure (Regulations Nos 542/69 and 222/77)

procedure is not compulsory for the would be contrary to the interests of the carriage of goods by pipe-line confirms Community"; the limits of the exception that the rules in question merely have a are exceeded by the imposition of the procedural character. cost of such aids equally on private undertakings which have a similar purpose and operate in the sector of trade which is seriously affected thereby. The Commission also states that the rules Distortion of competition incompatible on the Community transit procedure with Article 90 (2) is thus created. relate only to customs formalities and do not concern the charges or duties which may be levied on goods in transit. In relation to national taxation applying to In this case, it is not the State aid as such goods, reference should be made to which is challenged, but the way in other provisions of Community law, in which it is financed. particular to Articles 12 et seq., 95 et seq. and, for goods imported from non- member countries, to the provisions on the Common Customs Tariff and the The Trieste Port Authority criticizes the common commercial policy. Company's arguments as being er- roneously based on the connection which it alleges between the cost of management of the port and certain specific services from which the users Rules on competition (Article 90) benefit. In reality the cost of management refers not to individual operations but to all the many different activities necessary for the construction, The Company states that, within certain development, management and upkeep limits and for certain services, there is of the port installations and also to the competition between the Trieste Port organization of the offices and technical Authority, a public undertaking, and and administrative services. The itself, a private undertaking; the public contested charges do not constitute the undertaking receives State aids for the consideration for services rendered; they performance of its tasks and even for are of a fiscal nature and are payable, services which it does not provide (in regardless of the ownership of the instal- particular for the unloading of crude lations used, simply by reason of the oil); the private undertaking, the unloading and loading of goods. Company, relies exclusively on private finance and is even obliged to finance State aids granted to the public under- taking by paying for services which have not been received and which it provides The uniform and non-discriminatory itself. system, to which all users of the port are subject, rules out any difference in treatment, particularly as the amount of the revenue charge depends exclusively on the volume of goods unloaded or State aids granted to a public under- loaded by each undertaking. taking entrusted with port services are not by law incompatible with the Treaty. However, Article 90 (2) limits them by stating that "The development of trade In any case, the condition for the must not be affected to such an extent as applicability of Article 90 (1) of the EEC

Treaty is absent in this case; that installations pay for services actually provision refers to rules on competition rendered. However, the "favoured" to be complied with in the "trade undertakings do not receive any aid between Member States", whereas the financed by State resources and any main action relates to petroleum possible discrimination takes the form of products coming from Libya and the the taxation of undertakings not Middle East and bound for Germany benefiting from certain services but does and Austria; furthermore, the public port not have the character of an aid for authority is in no way in competition those benefiting from them. with the Company. The public port authority carries out the public service of managing the port installations and services, using for that purpose defined It is not incompatible with the rules on by public law the resources which it competition in the EEC Treaty, in obtains from port charges; the Company particular with Article 90, for a Member does not and cannot offer to other users State to provide for taxation on goods, of the port any services in respect of without any distinction as to destination, which it might be regarded as being in origin or place of consignment, on the competition with the public port occasion of their loading or unloading in authority, which has no commercial specified ports managed by autonomous activities and does not operate for profit. public undertakings, for which the proceeds from the taxation are in part intended, even when the loading or unloading operations are performed by The Government of the Italian Republic the undertaking using its own instal- states that the question put by the Corte lations, without the performance of any Suprema di Cassazione is not of a direct and specific service by the public specific nature, inasmuch as it does not port authority. state which Treaty rules governing public undertakings are infringed by Article 2 of Decree Law No 47 of 1974. In any event, the contested taxation does not The transit arrangements with Austria concern trade between Member States and does not place certain undertakings at an advantage. The Company considers that Regulation No 542/69, replaced by Regulation No 222/77, concerns both the external and The Commission observes that the the internal Community transit question on Article 90 concerns only the procedure and lays down the principle of port charge; furthermore, Article 90 freedom of transit for Community refers to other provisions of the Treaty products and for products from non- and it is difficult to determine those member countries. which are relevant, in connection with Article 90, in the main action. The Trieste Port Authority states that the Agreement between the EEC and the Undertakings using their own instal- Republic of Austria on the application of lations are in effect penalized, inasmuch tlie rules on Community transit, as they pay the charge without benefiting concluded by Regulation No 2813/72, from certain services, whereas under- provides in Article 1 that it concerns "the takings which do not have their own movement of goods between two points

In any case, the Community transit The Government of the Italian Republic procedure has a purely procedural considers that the question does not character. concern the Community legal order but must be resolved by reference to national law; in any event, the Community provisions relied upon do not have direct The Commission observes that, although effect. Article 18 of the Agreement of 22 July 1972 between the EEC and the Republic of Austria, concluded by Regulation No The Commission points out that 2836/72 of the Council of 19 December according to the case-law of the Court 1972 (Official Journal, English Special Article 90 (2) is not at present capable of Edition 1972 (L 300), p. 3), prohibits any creating individual rights which the measure or practice of an internal fiscal national courts must protect. nature establishing discrimination, it concerns only products originating in and not products destined for the territory of the other party. I l l — R e p l i e s to the s u p p l e m e n - tary information requested by t h e C o u r t The legal rights of individuals

The charges are collected by the State; Since the basis of the charges is the part of the port charge which exclusively the carrying out of unloading exceeds the rates fixed by Law N o 82 of or loading, whatever the destination of 1963 is handed over by the State to the the goods for customs purposes (import- body which administers the port, in ation, exportation, transit and the like) order to contribute to its financial and they are imposed without distinction stability, the construction of new port on domestic and imported products, they installations and an increase in the have no relation to customs duties or capacity of existing plant and instal- charges having equivalent effect. The lations. fact that the unloading or loading may precede the importation, exportation or transit is irrelevant. B — Description of the disputed charges as "internal taxes"

The Government of the Italian Republic states that under the port system of every "The Italian Government and the Member State of the Community there Trieste Port Authority describe the are, in addition to particular fees or disputed charges as 'internal' taxes. expenses corresponding to specific Those parties are requested to services, duties and charges justified by explain how they justify that the general advantages resulting from the description in the case of goods in port structure as a whole; those charges transit which, as such, are not have various titles and are basically pro- intended to be released for portionate to the tonnage of the ship consumption within the State entering the port or to the tonnage of through which they are being goods loaded and unloaded. transported."

The Trieste Port Authority provides the The disputed charges in fact have no following information : connection with charges which presuppose a particular destination or special situation of the goods for customs (a) In Belgium, in the ports of Ghent purposes; their application is based on and Zeebrugge, charges are imposed on the fact of the unloading or loading in ships, calculated on the basis of the net ports of any goods, domestic or foreign, registered tonnage, and on goods loaded whatever the place of consignment or or unloaded. destination, without any element of discrimination; they are independent of (b) In the Danish ports an anchorage the crossing of a frontier and do not charge is levied, calculated on the basis constitute measures which are restrictive of the net registered tonnage of the ship, or otherwise protectionist. Italy is a and a charge on cargo, calculated on the country which imports oil and its imports basis of the tonnage of the goods and are not exempt from the revenue and varying according to five groups of cate- port charges on unloading provided for gories of goods. in Decree Law No 47 of 1974.

(c) In the French ports, a charge is The charges in .question are related to levied on the net registered tonnage of the use of the port for commercial the ship, with variable rates according to purposes (unloading and loading of the port, a berthing charge is levied on goods) and are not influenced by the ships and a charge is levied on goods preceding or subsequent stage of trans- loaded, unloaded or trans-shipped. portation or distribution.

registered tonage of ships, the navigation the charges imposed on the unloading of zone and the type of cargo. That general petroleum products. port charge includes a charge on tonnage in the port of Hamburg, based in general The Government of the Italian Republic, on the gross registered tonnage, the referring to the same study, emphasizes demurrage charge and the wharfage (not that, compared with the other ports in levied in the ports of Hamburg and the Community in which the conditions Kiel), also calculated on the basis of the for the transport of crude oil are similar, tonnage of the goods loaded or namely Marseilles (Fos-sur-Mer) and unloaded. Rotterdam, Trieste may claim the lowest costs for the use of port installations, both in relation to the consideration for (e) In the United Kingdom, the main specific services and in relation to the duties and charges on shipping are charges justified by the general lighthouse dues, the charge for main- advantages offered by the port and the taining the channel entrances between port administration. the high sea and the quays and anchorage dues, which are related to the use of the stretch of water situated in The entire proceeds of port charges front of the quay and of the part of the collected at Fos-sur-Mer and Rotterdam jetty occupied by the ship within the go to the respective public port harbour area. authorities, whereas the Trieste Port Authority receives only part of the amount of the disputed charges. (f) In Ireland, there is a tonnage charge, calculated on the basis of the The amount of those charges has gross or net registered tonnage of ships remained unchanged at Trieste since and the tonnage of the cargo transported 1980, whereas it has risen in the other in unmeasured space (for example the bridge cargo), and a charge on goods ports. loaded, unloaded or trans-shipped within a port. The port of Trieste is also more economical for traffic in oil than the ports of Le Havre, Donges, Verdón and (g) In the Netherlands, wharfage is Séte, which moreover do not have any charged, calculated for all ships pipe-lines. transporting goods by sea on the basis of the gross registered tonnage of the ship or the tonnage of the goods loaded or At the port of Trieste the "fees" for the unloaded, and also wharfage for the actual unloading of the oil by pump are exclusive occupation by the ship of a in fact levied and collected by the mooring post. Company.

there are no such transit charges in the powers contained in the statutes under countries in which they are established. which they are constituted or under Section 26 of the Harbours Act 1964 to levy goods dues. Such dues, together with ship and passenger dues, contribute to the income of the harbour and enable The Government of the French Republic the harbour authorities to fulfil their states that the French system of port duties of managing, maintaining and charges and fees for the use of improving the harbour facilities; equipment is governed by the Code des although it is impossible to obtain Ports Maritimes [Code on Maritime absolute correspondence, the dues are Ports], and collection is carried out "as designed to cover the cost of providing, in relation to customs duties". maintaining and improving those facilities. Ship dues are normally related to ship tonnage; goods dues are normally related to the tonnage of goods or in For commercial shipping port charges some cases to the number of units. They include a charge on the ship and, where roughly approximate to the use made of appropriate a berthing charge, a charge the harbour installations. on goods and a charge on passengers; national case-law regards these charges, levied for the exclusive benefit of the public organizations or authorities which The power to make such charges is participate in financing the operation of subject to the control of the Secretary of the port, as fees for "services rendered", State; he may, upon request, give a except for the charge on passengers, direction disallowing or reducing the 25 % of which goes to the State, and charge concerned. which is in the nature of a revenue charge. The rates of port charges vary according to the port; in addition, in each port certain reductions in the charge on goods may be granted. The dues are levied without distinction on outward and inward traffic and on overseas and coastal traffic; there are no particular rules for transit traffic.

The port charge is contrary to Article V The Company observes that within the (3) of GATT. That provision does not framework of GATT only the prohibit only charges levied specifically Contracting Parties are authorized to and exclusively on goods in transit. In rely upon infringement of GATT. relation to customs duties, it prohibits not only customs duties on transit but also customs duties which divide the The Government of the Italian Republic transit operation, for example into states that it does not seem that the facts importation and exportation, in order to at issue in the main action have been provide a basis for taxation; it covers dealt with within the framework of generally both taxation levied by reason GATT. only of transit and taxation which is charged on goods. - in transit on the occasion of transit but is also charged on The Government of the Federal Republic other goods for another reason, such as of Germany confirms that hitherto the importation. interpretation of Article V (3) has never officially been dealt with within the framework of GATT. In this regard it is necessary to apply the method of interpretation used by the Court in its well-established case-law, in According to the information at the particular in connection with the concept disposal of the Commission, this kind of of a charge having an effect equivalent question has never been dealt with within to a customs duty on imports within the the framework of GATT. meaning of Articles 9 and 12 of the EEC Treaty.

It follows from its title and from The provision applicable to the disputed paragraph (2) thereof that the object of charges is not Article III but only Article Article V of GATT is to ensure freedom V of GATT. of transit; the prohibition in principle set out in Article V (3) can contribute to the achievement of that objective only if it covers not only actual transit charges, In short, the legitimacy of the disputed but also any charges on goods on the port charges depends on whether or not occasion of transit, since such charges they constitute consideration for services always constitute a barrier to freedom of rendered by a public authority; transit. according to the findings of the Corte Suprema di Cassazione, the reply to that question is negative. The disputed charges are therefore incompatible with Article V (3) of GATT. The port charges in issue in the main action are not "internal taxes" within the meaning of Article III of GATT, since The obligations imposed on Member they are not charged on domestic States by virtue of the EEC Treaty are at products and the imported products in least equivalent to the obligations question without distinction. In fact, undertaken by the parties to GATT: the Italian products and products imported EEC Treaty could not reduce the into Italy are not affected where they are obligations already imposed on Member transported by road or by rail and thus States by GATT. do not pass through an Italian port or airport. In this context there can be no question of a "system of taxation". It is clear from Article 9 (2) that the provisions of the EEC Treaty on intra- Community trade are not applicable to the disputed port charges, which are Article III (1) and (2) of GATT pursue levied on the unloading of goods from an objective which is totally different non-member countries; however, in so from that of Article V. Article III far as they relate to goods intended to be concerns taxes which are imposed on transported by way of transit to other products by reason of their being Member States, the provisions on the marketed in the State concerned; the free movement of goods should be taken fiscal measures are in that case limited by into consideration, even though they are the obligation to ensure competitive not directly applicable. The prohibition neutrality, which is clearly not necessary on the taxation of goods from a non- for goods in transit. Article V on the member country which are in transit is other hand does not relate to the indeed not expressly provided for in marketing of products but to traffic and Articles 9 et seq. and 30 et seq. of the thus to movements of goods. In relation EEC Treaty. The free transit of goods to Article III, Article V (3) constitutes a within the Community is ensured by the special provision which exempts goods in reference to "prohibitions . . . on . . . transit from any customs duties on the goods in transit" in the first sentence of ground that, unlike other goods, they do Article 36 of the EEC Treaty; for transit not reach the internal market of the concerning a non-member country and country through which they pass; the two or more Member States, the same applies to any other internal prohibition on the collection of transit taxation of a general nature. charges follows from an application by

"The parties are requested to give To goods coming from non-member their detailed views on the countries which are not put into free question raised in the German circulation in the Community the Government's observations re- principle of competitive uniformity, not garding the compatibility of competitive equality, applies. Their revenue charges levied on goods in competitive position may be altered or transit with the general system of made more disadvantageous, with regard freedom of trade within the to that of Community products, common market. In particular, the according to the level of protection parties are invited to answer the afforded to the latter; that level of question whether certain provisions protection should, however, be uniform of the EEC Treaty, such as Article and that is ensured by the Common 16 or Article 34, are applicable for Customs Tariff. The principle of the purpose of determining what competitive uniformity, which is revenue treatment is to be applicable to products coming from non- accorded to transit traffic; if not, member countries, by its nature implies the parties are invited to state that goods in transit in one Member whether they consider that the State intended for another Member State provisions of Article V (3) of may not be subject in the country GATT might be applicable within through which they pass to any charge the framework of Community law which does not constitute simply the and, if so, whether those pro- consideration for services rendered; visions, applied in that framework, otherwise, in the country of destination

the competitive position of those goods more generally, Article 9 of the EEC would be even more disadvantageous Treaty. An internal tax applied to and would in any event be different from products in transit is not incompatible that in which the Community intended with the prohibition of charges having an to place them and which is determined effect equivalent to customs duties on by the Common Customs Tariff. imports, since the imported products are subject to internal taxes, but becomes a charge having an effect equivalent to a customs duty on exports if it is not Articles 16 and 34 of the EEC Treaty refunded when the products in question may not, merely because they refer to leave the country through which they the concept of "exports", be interpreted pass. as not applying to goods in transit.

With it. That interpretation seems compatible regard to the customs procedure, the with the principle laid down in Article 3 crude oil unloaded at Trieste to be sent (a) of the Treaty, of which Articles 16 on to Germany and Austria is subject to and 34 constitute a specific application. the system of customs storage. Since the crude oil put into the transalpine pipe- line is not technically speaking in free circulation, the contested unloading By that interpretation, an internal tax charges constitute an infringement of the levied on goods in transit indisputably Common Customs Tariff far more than constitutes a charge having an effect an infringement of the rules on freedom equivalent to a customs duty on exports, of trade. The prohibition of the contrary to Article 16, Article 12 or, imposition of charges having an effect

The provisions of GATT are no longer The obligations contained in Article V applicable in the relations between (3) and (4) necessarily refer only to taxes Member States of the EEC. The EEC which are compatible with the pro- Treaty therefore necessarily contains, hibition contained in paragraph (3). even if only by implication, rules analogous to those of Article V (3) of GATT; indeed, its rules on freedom of It is in no way paradoxical that products transit, in its widest meaning, must not in transit, since they are exempt from fall short of those contained in GATT. internal taxes, enjoy more favourable treatment than the national treatment provided for in Article III of GATT; on Article V (3) of GATT remains the contrary, it would be paradoxical for applicable in the relations between internal taxes to be levied on products Member States and non-member wholly foreign to the market of the State countries; limited to products in transit which applies such taxes. from or to a non-member country which is party to GATT, it may be relied upon by individuals before the national court. The Trieste Port Authority considers that the main action does not raise the problem of the treatment for revenue The statement that Article V (3) of purposes of goods in transit, since the GATT prohibits only charges on transit disputed unloading charges do not as such and not charges of which the concern transit but the port operation of raison d'être is the fact of unloading unloading or loading. is contradicted by the following considerations:

of imports or exports. All port charges on such transit traffic, whereas movements of goods, whatever their Articles 30 and 34 are less relevant. origin and destination for customs purposes, including domestic products moving within the country, are subject to the charges in question; competitive The Commission confirms that it shares neutrality is therefore absolutely the opinion expressed by the Corte respected from the point of view of Suprema di Cassazione that the disputed taxation in accordance with the basic charges do not constitute charges having principle of non-discrimination. an effect equivalent to customs duties on imports within the meaning of Article 13 of the EEC Treaty; nor may they be regarded as charges having an effect The EEC Treaty has replaced GATT in equivalent to customs duties on exports all the areas which it governs as the within the meaning of Article 16. Article source of rights and obligations of States 34, which concerns quantitative restric- within the Community; the provisions of tions and measures having equivalent GATT therefore may be relied upon to effect and not pecuniary charges, is not define the relations between Member applicable in this case. States of the Community. Moreover, the objectives pursued by GATT are different from and much more limited than those laid down in the EEC Treaty; Article V (3) of GATT does not prohibit GATT, which is of a flexible nature, is charges such as the disputed charges; if based on the fundamental principle of that were not so, it would be necessary reciprocity and balance. Direct effect in in that light to examine Article 16 of the the framework of Community law EEC Treaty. Article V (3) of GATT may cannot be attributed to GATT without not be applied in the framework of an alteration of its legal scope, a failure Community law. to appreciate its contents and objectives and a denial of the essential character of the condition of reciprocity. The question whether Article V (3) of GATT may be relied upon in the framework of Community law does not arise; it would, however, be permissible The United Kingdom observes that in for an individual, relying upon a an examination of transit traffic a provision of Community law which has distinction must be drawn: goods which direct effect, to refer to GATT as a do not satisfy the conditions laid down means of interpretation of Community in Articles 9 and 10 of the EEC Treaty law. are "non-Community goods" and are subject to the provisions of the Treaty on the common commercial policy and to the international obligations of Member States and of the Community; the goods G — The Communtiy's responsibility which satisfy the conditions laid down in towards the Republic of Austria in Articles 9 and 10 of the Treaty are the framework of GATT and the "Community goods", which are free-trade agreement therefore subject to the provisions of the Treaty on free movement of goods; Articles 13 and 16 as well as Article 95 "The parties are asked to answer may be relevant to the levying of revenue the question raised in the Danish

The Government of the Federal Republic The Company takes the view that, since of Germany considers that, in the the Community as such has assumed the framework of the Common Commercial obligations under GATT, it has bound Policy, the Community has a certain the Member States in accordance with responsibility towards non-member Article 228 (2) of the the Treaty; the countries with regard to compliance with Member States may not unilaterally the rules of GATT. When a Member disregard their obligations without State does not fulfil the obligations infringing Article 228 and without imposed upon it by virtue of GATT in its engaging the responsibility of the Com- relations with a non-member country, munity towards the other Contracting the non-member country concerned may Parties of GATT. adopt sanctions; as a result of the establishment of a common commercial policy, those sanctions will affect not only the Member State in question but The Free-Trade Agreement between the the whole of the Community. The EEC and the Republic of Austria is not Community therefore has an interest in applicable in this case: Article 2 provides ensuring that the Member States comply that it applies only to products orig- with the rules of GATT. inating in the Community or Austria.

The provisions of the Free-Trade On the other hand, Article V (3) of Agreement between the EEC and Austria GATT is applicable: the preamble to the must be interpreted independetly, even Agreement between the EEC and Austria where they correspond word for word expressly states that the parties are not with provisions of the Treaty. However, exempted from the obligations which are the prohibition of charges having an incumbent upon them under other inter- effect equivalent to customs duties, laid national agreements. down in Article 12 et seq. of the EEC

Treaty and in Artide 7 of the Agreement trade agreement may not be given an between the EEC and Austria should be interpretation which would lead to a given the same interpretation in the two system of trade less favourable than that treaties, since such charges directly affect arising out of GATT; thus, the question the movement of goods and the two where the proper interpretation of agreements have to this extent the same Article 7 of the free-trade agreement objective. must be situated within that margin depends in the final analysis on an assessment of the extent to which the objectives and scheme of the agreement The United Kingdom considers that the are comparable to the objectives and Community does indeed have responsi- scheme of the EEC Treaty, on which the bility towards non-member countries interpretation of Article 16 is based. regarding fulfilment of the obligations assumed by it in the exercise of its power under Article 113 of the EEC Treaty, including the rules of GATT. H — Interpretation of Article 1 of the Agreement between the EEC and Austria on transit The Agreement between the EEC and Austria applies only to products orgi- nating in the Community or Austria and "In Part 4 of its obersvations on is therefore not directly relevant to the the fourth question, the Trieste issues in the main action. Port Authority refers to the transit agreement concluded with Austria pursuant to Regulation No 2813/72 of the Council. It notes The Commission, whilst not agreeing that that agreement, by virtue of with the arguments of the Danish the terms of Article 1 thereof, Government in every respect, supports its concerns only 'goods moving opinion that, from the moment when the between two points situated within Community was substituted for the the Community, through Austrian Member States with regard to the territory'. The Court requests the fulfilment of the commitments arising parties, and in particular the out of GATT, it assumed a responsi- Italian Government and the bility, in particular towards Austria, in Commission, also to give their relation to compliance with the rules of views on the scope of the second GATT by the Member States. paragraph of Article 1 of that agreement, by virtue of which the rules relating to Community transit 'may also apply to any In relation to the interpretation of Article other carriage of goods passing 7 of the Free-Trade Agreement between through the territory of the the EEC and Austria, even if, contrary to Community as well as through all expectations, Article 16 of the EEC that of Austria'." Treaty may be interpreted as prohibiting the disputed charges, it should be stated that the similarity in wording cannot be enough to transpose to the provisions of The Company considers that the second the free-trade agreement the interpret- paragraph of Article 1 of the transit ation given to Article 16 governing intra- agreement concluded with Austria must, Community trade; moreover, the free- in the light of the other provisions of

that agreement, be interpreted as In the first case, the rules on Community meaning that the transit procedure for transit may optionally also be applied to which it provides may also apply to the transport of goods from a non- goods coming from or bound for Austria member country to Austria after transit which cross the territory of the through Italy (Trieste). Community. The Commission states that under the According to the Trieste Port Authority, first paragraph of Article 1 of the the Community transit procedure does Agreement between the EEC and not concern and does not alter the Austria, the Community transit revenue treatment accorded to the procedure is in principle compulsory for goods; moreover, the Company is not the crossing of Austrian territory, where availing itself of the Community transit the goods enter that territory in the procedure and the main action does not course of transport carried out between concern charges in respect of transit. two points situated in the Community; such transport may be carried out The Government of the Italian Republic directly, either with trans-shipment in states that petroleum products unloaded Austria or re-consignment, where appro- in the port of Trieste are declared for priate after storage in a bonded customs purposes under the rules on warehouse in Austria. placement in storage and then removed from storage to be taken to the countries of destination; in particular, in relation Under the second paragraph of Article 1 to transport to Austria, the Company of the agreement, the operator has the does not have recourse to the option of using the Community transit Community transit procedure but to the procedure where the transport over procedure of consigning foreign goods Austrian territory does not involve two with a "bolletta di cauzione", which is points situated within the Community. provided for by the national rules. That applies to the transport of goods from the Community or a non-member country to Austria, the transport of The Government of the Federal Republic goods from Austria to the Community or of Germany considers that the second a non-member country, the transport of paragraph of Article 1 of the Agreement goods between the Community and a between the EEC and Austria on non-member country with passage over Community transit may apply to the Austrian territory, with or without trans- transit of goods: shipment on that territory.

in the Officiai Journal of the for the Trieste Port Authority; Mr European Communities (C 280, of d'Amato, for the Government of the 31 October 1981, p. 4)." Italian Republic; Alexandre Carnelutti, Secretary of Foreign Affairs in the Ministry of External Relations, for the Government of the French Republic; Mr Seidel, for the Government of the The Government of the Federal Republic Federal Republic of Germany; and Mr of Germany refers to a memorandum Olmi, for the Commission of the from the Austrian Government dated 9 European Communities. June 1982 and a letter from the Austrian Embassy to the Federal Republic dated 8 July 1982. Those documents indicate the economic impact of the disputed charges on Austrian imports of crude oil through The Government of the French Republic, Italy (a charge of about ÖS 150 million which had not submitted written obser- from 1974 to the end of 1981; from 1 vations, pointed out that the Court of January 1982, an annual charge of about Justice, according to its case-law, has ÖS 30 million, since the amount of the jurisdiction to interpret an international charges was doubled by Italian Law No agreement on two conditions: the 692 of 1 December 1981) and set out the Community must be bound by the grounds on which the contested charges relevant provision of the agreement and are, in the opinion of the Austrian that provision must be capable of Government, incompatible with Anicie V conferring rights on individuals. With (3) of GATT. regard to the first condition, it should be noted that the Community had no jurisdiction in the field of application of GATT until 1 July 1968 and that, even after that date, although jurisdiction in The Commission observes that Austria revenue matters was circumscribed and has not approached it in relation to the limited by Community rules, it was not questions at issue; however, it is aware transferred from the Member States to that Austria considers the port charges to the Community; as to the second be contrary to GATT. condition, it should be recognized that neither Article II nor Article V (3) of GATT is capable of conferring on citizens in the Community the right to rely upon it before the courts.

On the one hand, the interpretation of Articles 90, 113 and 117 of the EEC Treaty, of Regulation No 542/69 of the Council of 18 March 1969 on Community transit (Official Journal, English Special Edition 1969 (I), p. 125) and of Regulation No 2813/72 of the Council of 21 November 1972 on the conclusion of an agreement between the European Economic Community and the Republic of Austria on the application of the rules on Community transit (Journal Officiel L 294, p. 86); and

On the other hand, the effect within the Community of the General Agreement on Tariffs and Trade (GATT) of 30 October 1947 and the interpretation of Article V of GATT on freedom of transit.

The Corte Suprema di Cassazione put the questions in order to enable it to determine the compatibility with Community law and, if necessary, with the rules of GATT of the application of charges on unloading and loading of goods imposed by virtue of Decree-Law N o 47 of 28 February 1974, converted into Law No 117 of 16 April 1974 (hereinafter referred to as "Decree-Law N o 47"), to oil carried by the transalpine oil pipe-line to the Federal Republic of Germany and the Republic of Austria.

2 It appears from the file that those questions arose in connection with a number of disputes between, on the one hand, Società Italiana per l'Oleodotto Transalpino [hereinafter to as "the Company"], a company governed by Italian law which was responsible for the construction and operation of the section of the transalpine oil pipe-line in Italian territory

SIÓT v MINISTERO DELLE FINANZE

between Trieste and the Austrian border, and, on the other hand, Ministero delle Finanze [Ministry of Finance], Ministero delle Marina Mercantile [Ministry of Shipping], Circoscirzione doganale di Trieste [Trieste Customs Authority] and Ente Autonomo del Porto di Trieste [Trieste Independent Port Authority] in relation to the levying of the contested charges on crude oil discharged into the Company's installations for consignment to refineries in the Federal Republic of Germany and the Republic of Austria.

4 In its preliminary ruling of 10 October 1973 in Case 34/73, Variola v Amministrazione Italiana delle Finanze, [1973] ECR 981, the Court held that a charge such as the first-mentioned, imposed specifically on imported products, was to be regarded as a charge having an effect equivalent to a customs duty and accordingly was incompatible with Community law. At the same time, the Commission had lodged an application in connection with the unloading charge for a declaration that Italy had failed to fulfil its obligations as a Member State, which was entered in the Court Register under No 172/73 (Official Journal 1973, C 99, p. 4). As a result of the judgment cited, Italy amended its legislation by Decree-Law No 47. The unloading charge was replaced by a State charge on unloading and loading, hereinafter referred to as the 'revenue charge', which applied regardless of the origin or destination of the goods. The Commission considered that, as a result of that change in the contested charge, the failure to fulfil obligations under Community law no longer existed and consequently it withdrew its application (Official Journal 1974, C 69, p. 5). The port charge remained in force in accordance with the provisions of the Law of 1963, apart from the abolition of the exception previously provided for in favour of transit through the port of Trieste.

JUDGMENT OF 16. 3. 1983 — CASE 266/81

5 As from the application of Decree-Law No 47, the Italian tax authority required the payment of the two charges — the revenue charge and the port charge — in respect of crude oil discharged into the Company's installations and transmitted through the transalpine oil pipe-line. The Company brought several actions challenging those charges before the Tribunale [District Court], Trieste, in relation to periods during 1974 and 1975. It subsequently paid the charges without prejudice, pending the outcome of those actions. The applications were dismissed by the Tribunale, Trieste, and the Company lodged appeals before the Corte d'Appello [Court of Appeal], Trieste, which in turn dismissed the appeals in successive judgments. After those judgments, several appeals in cassation were brought before the Corte Suprema di Cassazione.

7 The Corte Suprema di Cassazione, considering that the charges in question were taxes levied on goods loaded and unloaded and were imposed on all

SIÓT v MINISTERO DELLE FINANZE

such goods, regardless of their origin or their destination, took the view that the contested charges were not import levies but internal taxation within the meaning of Article 95 of the Treaty and Article III of GATT.

s On the basis of those considerations, the Corte Suprema di Cassazione took the view that problems of interpretation arose under Community law in relation to the regulation on Community transit, the transit agreement with Austria, the rules on the common commercial policy laid down in Article 113, and the rules on competition contained in Article 90 of the Treaty.

JUDGMENT OF 16. 3. 1983 — CASE 266/81

(B') If the foregoing question is answered in the affirmative :

What, if any, are the effects which follow, within the legal order of the Community and within those of the Member States, from the fact that the Community has been substituted for the Member States with regard to the fulfilment of the obligations laid down in GATT. If those effects occur at different times, what is their sequence? In particular, for the purpose of deducing therefrom a basis for the interpretation or a rule for the application of later national provisions which conflict with the provisions of GATT, is the national court obliged to take the view, having regard to the attribution of jurisdiction under Article 177 of the Treaty, that GATT, with specific reference to the provisions referred to in the following question, operates provisions referred to in the following question, operates at the level of a mere international obligation and has no direct effect internally, or else that it does have such effect with regard to relations between parties, and, if the latter is the case, has GATT the same status as, or greater status than, the conflicting national provisions?

(C) If an affirmative reply is given to Question A and whatever the reply to Question B, with a view to providing the national court with guidelines relevant to the interpretation of the national provisions :

(D) Regardless of the replies to Questions A, B and C:

1. In the light of the principles on which Community system is based regarding the proper role of competition and the common commercial policy, with particular reference to the rules laid down in Articles 90 (1) and 113 (1) of the Treaty respectively, and in relation to the specific provisions governing Community transit laid down by Regulations (EEC) No 542/69 of the Council of 18 March 1969 and No 2813/72 of the Council of 21 November 1972, is the national legislature prohibited, and if so within what limits, on what conditions and subject to what requirements, including those of a formal nature, regarding the origin of the goods and the transit procedure relating thereto, from providing for the imposition of charges (such as the revenue charge on goods unloaded or loaded in all the national sea ports and the port charge on goods unloaded or loaded in some only of those ports, referred to respectively in the first and second paragraphs of Article 2 of Decree-Law No 47 of 28 February 1974, converted into a law by Law No 117 of 16 April 1974) both on domestic products or products treated as such and on imported products, on the occasion of the unloading or loading of the said goods in sea ports of the member country, which charges are levied on the imported product even where, having originated in a non-member country, it is merely in transit through national territory and is intended for the markets of the Federal Republic of Germany and of Austria, and even where — particularly with regard to those of the said charges which are laid down for specified ports administered by autonomous authorities, for which the charges are in part intended — the operations of unloading, loading and forwarding to the market for which they are finally intended are carried out exclusively by a commercial undertaking using installations and plant

T h e rules g o v e r n i n g transit within the C o m m u n i t y

H By Question (D), the Corte Suprema di Cassazione asks whether the application to goods in transit of charges imposed by reason of loading or

SIÓT v MINISTERO DELLE FINANZE

unloading on all goods without distinction, regardless of their origin or destination, is compatible with the principles on which the Community legal order is based and in particular with Regulation N o 542/69 on Community transit, where the operations of unloading, loading and forwarding to the market for which they are finally intended are carried out exclusively by a commercial undertaking using installations and plant constructed, managed and maintained by that undertaking, without the provision of any direct or specific service by a public port authority.

is By Question (C), the Corte Suprema di Cassazione asks whether such charges are compatible with Article V (3) of GATT.

i6 The Customs Union established by Part Two, Title I, Chapter 1 of the EEC Treaty necessarily implies that the free movement of goods between Member States should be ensured. That freedom could not itself be complete if it were possible for the Member States to impede or interfere in any way with the movement of goods in transit. It is therefore necessary, as a consequence of the Customs Union and in the mutual interest of the Member States, to acknowledge the existence of a general principle of freedom of transit of goods within the Community. That principle is, moreover, confirmed by the reference to "transit" in Article 36 of the Treaty.

ECR 1609, that, although the prohibition of charges having an effect equivalent to customs duties appears only in Section 1 of the chapter of the Treaty relating to the Customs Union (Articles 12 to 17), which relates to products in free circulation in the Member States, and not in Section 2 of the same chapter (Articles 18 to 29), which concerns products imported directly from a non-member country, that does not mean that such charges may be introduced or maintained in relation to those products. As was also pointed out in the judgment cited, the establishment of the Common Customs Tariff is intended to achieve an equalization of customs charges levied at the frontiers of the Community on products imported from non-member countries, in order to avoid any deflexion of trade in relations with those countries and any distortion of free internal circulation or of competitive conditions. For the same reasons, the fact that the same provisions do not contain any express prohibition of transit charges cannot mean that such charges may be introduced or maintained by the Member States, since the very principle on which they are based is incompatible with a customs union and a fortiori with the principle of the free movement of goods, which is the very foundation of the common market.

i9 It must therefore be accepted that the Member States would contravene the principle of freedom of transit within the Community if they were to apply to goods in transit through their territory transit duties or other charges imposed in respect of transit.

zo However, the impostition of charges which represent the costs of transpor- tation or of other services connected with transit cannot be regarded as incompatible with freedom of transit as defined above.

23 T h e answer to the question submitted should therefore be that the existence within the C o m m u n i t y of a customs union characterized by the free m o v e m e n t of g o o d s implies freedom of transit within the C o m m u n i t y . T h a t freedom of transit means that a M e m b e r State may not apply to g o o d s in its territory in transit to or from another Member State transit duties or other charges imposed in respect of transit. However, the imposition of charges or fees which represent the costs of transportation or of other services connected with transit cannot be regarded as incompatible with freedom of transit as defined above, bearing in mind that it is necessary to take account not only of direct and specific services connected with the movement of goods but also of the more general benefits derived from the use of harbour waters or installations for the navigability and maintenance of which the public authorities are responsible.

24 It is for the national court, having regard to all the circumstances of the case, to determine the compatibility of the contested charges with freedom of transit as defined above.

25 In view of the considerations set out above, the question submitted in relation to Article 90 (1) has no purpose.

R u l e s g o v e r n i n g t r a n s i t in r e l a t i o n s w i t h A u s t r i a

26 Questions (C) and (D), in so far as they relate to the rules applicable to oil in transit in Austria, in substance concern the interpretation of the Community rules establishing a common commercial policy, as contemplated by Article 113 of the Treaty. Question (D) asks whether the imposition of the charges described above is compatible with Article 113 and with the transit agreement concluded by the Community with Austria, which forms the subject-matter of Regulation N o 2813/72, adopted on the basis of

29 As regards Article 113 of the T r e a t y , although that provision confers upon the C o m m u n i t y powers which enable it to take any appropriate measure concerning the c o m m o n commercial policy, it nevertheless does n o t in itself contain any legal criterion which is sufficiently precise to enable an assessment of the contested transit rules to be made.

30 T h e answer to the question submitted should therefore be that there is no rule which m a y be relied upon by individuals in order to challenge the application to goods in transit to Austria of a charge such as the contested loading and unloading charges.

SIÓT v MINISTERO DELLE FINANZE

3i It is therefore clear that, since Article V of GATT does not apply to transit within the Community and since that provision does not have direct effect in relation to transit to Austria, Questions (A) and (B) have no purpose.

Costs

32 The costs incurred by the Governments of the Federal Republic of Germany, the French Republic, the Italian Republic, the Kingdom of Denmark, the Kingdom of the Netherlands, the United Kingdom and by the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main actions are concerned, in the nature of a step in the actions pending before the national court, costs are a matter for that court.

2. There is no rule which may be relied upon by individuals in order to challenge the application to goods in transit to the Republic of Austria of a charge such as the loading or unloading charge levied in Italy by virtue of Decree-Law N o 47 of 28 February 1974, converted into Law N o 117 of 16 April 1974.

M e r t e n s de Wilmars Pescatore O'Keeffe Everling

M a c k e n z i e Stuart Bosco Due Bahlmann Galmot

Delivered in open court in L u x e m b o u r g on 16 M a r c h 1983.

P. Heim J. Mertens de Wilmars Registrar President

OPINION OF MR ADVOCATE GENERAL REISCHL DELIVERED ON 14 DECEMBER 1982 '