C-165/87

COMMISSION v COUNCIL

O P I N I O N OF MR ADVOCATE GENERAL LENZ delivered on 29 June 1988 *

Mr President, on Nomenclature of December 1950 and Members of the Court, also to be used for the purpose of interna- tional trade statistics and of freight tariffs and transport statistics. In sum, the Convention was intended to facilitate inter- A — Facts national trade.

OPINION OF MR LENZ — CASE 165/87

decision in question should be regarded as a B — Analysis measure of commercial policy under Article 113 of the EEC Treaty.

11. In my analysis of the case I shall deal first with the question of the legal basis for 8. The applicant claims that the decision concerning the agreement as regards the setting-up of the customs nomenclature. A discussion of the problems connected with statistics on goods will follow. (i) Council Decision 87/369/EEC of 7 April 1987 concerning the conclusion of the International Convention on the Harmonized Commodity Description and Coding System and of the Protocol 1. Legal basis for the conclusion of an of Amendment thereto should be agreement on customs nomenclature declared void, and

COMMISSION v COUNCIL

14. During the transitional period of the tariff nomenclature. Those provisions of the European Economic Community a rule Treaty must therefore give the Community relating to competence as regards the authority to adopt the Brussels Nomen- setting-up of the Common Customs Tariff clature of 1950, to which the Member States was not actually necessary, since the were parties, as a necessary concomitant Common Customs Tariff, pursuant to (implied competence) to the authority to Article 19 et seq. of the EEC Treaty, was to change tariff rates. be derived from the customs tariffs of the four customs territories of the Community, which, despite varying rates of duty, were all based on the Convention of 15 December 1950 on Nomenclature for the 16. After the expiry of the transitional Classification of Goods in Customs Tariffs. period the annual regulations amending the As the Court held in its judgment of 19 Common Customs Tariff 5and the Council November 1975 in Case 38/75, 3 the decisions amending the nomenclature in Community has replaced the Member States which the recommendations of the Customs in commitments arising from that Cooperation Council were accepted 6 were convention; it was bound by that convention based on Articles 28 and 113 of the EEC just as it was by the convention of the same Treaty. date establishing a Customs Cooperation Council. Consequently, when the Common Customs Tariff was initially set up, the Community retained the so-called Brussels Nomenclature and based the relevant regu- 17. If the drawing-up of a customs nomen- lation on Articles 28 and 111 of the EEC clature within the Community can be based Treaty. 4 on Article 28 of the Treaty for autonomous rates of duty and Article 113 for conven- tional rates of duty, the question arises as to which provision of the Treaty is to be regarded as the proper legal basis for the conclusion of an international convention which provides for a uniform customs nomenclature for autonomous and conven- tional rates.

19. The applicant admits that the areas of applicability of Articles 28 and 113 of the 22. Of course the negotiators of the Treaty EEC Treaty partly overlap. Because, did not proceed on the basis that the however, the more general rule is to be customs tariff thus set up would remain found in Article 113, Article 28 of the EEC unamended. Therefore they conferred on Treaty should be interpreted narrowly. If a the Community the power inter alia to measure is intended to pursue an objective conclude tariff agreements. Tariff of commercial policy, then it falls under agreements necessarily comprise not only Article 113 and not under Article 28 of the tariff rates but also a customs nomenclature. EEC Treaty. Otherwise rates of duty simply cannot be set. It is quite natural that tariff agreements should be mentioned in Article 113 of the EEC Treaty, because tariff agreements, which, as I have said, comprise a customs nomenclature and tariff rates, will be concluded between the customs union of the 'European Economic Community' and 20. The introduction of a Common non-member countries. In the case of a Customs Tariff and a common commercial customs nomenclature, the Community is policy in respect of non-member countries is obliged by the circumstances to adopt a one of the most important activities of the multilateral approach. The autonomous Community. That follows from the position establishment of a customs nomenclature, of that function in the structure of the although theoretically conceivable, is no Treaty, that is, in Article 3 (b). The intro- longer practical, in so far as the Member duction of a Common Customs Tariff States of the Community and their legal necessarily presupposes the drawing up of a successor, the European Economic customs nomenclature. The appropriate Community, are bound by international provisions for the setting up of the Common agreements on such matters. Consequently, Customs Tariff are contained in Part 2 of Article 28 of the EEC Treaty is not the Treaty (Foundations of the Community, applicable whether on the basis of its Title I — Free movement of goods, Chapter wording or in the light of the circumstances. 1: The Customs Union, Section 2: Its wording speaks only of duties, however, Setting-up of the Common Customs Tariff). not of a nomenclature. Article 113 is thus the only possible legal basis for the estab- 7 — Judgment of 31 March 1971 in Case 22/70 Commission v lishment of a new customs nomenclature Council [1971] ECR 263. following international negotiations.

23. That Article 113 of the EEC Treaty change, which aligns the procedural must confer a power on the Community to provisions (but is not yet applicable here), conclude an agreement for customs nomen- means that the question of the demarcation clature is clear from the following consider- between Articles 28 and 113 of the EEC ations. It is not disputed that Article 28 of Treaty has lost its importance for the future. the EEC Treaty confers authority to alter However, the question must still be clarified autonomous customs duties if that alteration for the purposes of the present case. is based on reasons internal to the Community and is not related to the common commercial policy. Following the introduction of that common commercial policy, after the expiry of the transitional period, it must be assumed that the 25. If changes of tariff rates fall under authority conferred in Article 113 of the Articles 28 or 113 of the EEC Treaty EEC Treaty to alter customs duties is the according to the objective pursued, and general provision, and that it supplants to a Article 113 of the EEC Treaty provides in large extent the system of Article 28, which addition for the conclusion of tariff is contained in the section on the setting-up agreements, then it seems clear that such of the Common Customs Tariff before the agreements may deal inter alia with customs end of the transitional period. Finally, matters other than tariffs, including the Article 113 of the EEC Treaty speaks not structure of the customs nomenclature. only of changes in conventional tariff rates but of tariff rates in general. That view is supported by the judgment of 6 March 1987 in Case 45/86 8in which the Court held that Article 113 of the EEC Treaty was the 26. If, however, as I have explained, power correct legal basis for the generalized pref- is expressly conferred on the Community to erence system for goods from developing conclude an agreement on customs nomen- countries. At least as regards the suspension clature, according to a particular pro- of tariffs for industrial goods an cedure — Council decision by a qualified autonomous measure is involved which is majority — then it is no longer permissible not based on obligations resulting from to fall back on a residual competence which agreements, as the Council has recently is not expressly mentioned, does not confirmed in Case 51/87. 9 mention a power to conclude agreements at all and at the material time could be exercised only by way of a unanimous Council decision.

2. Application of Article 235 of the EEC Treaty for the customs nomenclature 31. It is surely indisputable that a nomen- clature which is intended to form the basis for the compilation of external trade stat- 29. Similarly, Article 235 of the EEC istics falls within the purview of the Treaty must be excluded as the legal basis common commercial policy. It serves as the for the conclusion of the agreement on the basis for obtaining information on the customs nomenclature. Reliance on Article development of international trade relations 235 of the EEC Treaty, as is clear from its and on the effectiveness of the instruments wording and as the Court held in its of commercial policy employed by the judgment of 6 March 1987 in Case 45/86, is Community. Such rules have such a close only justified when no other Treaty connection with the list of examples in provision confers on the Community Article 113 (1) of the EEC Treaty, which is institutions the powers necessary for the not intended to be exhaustive, that they can adoption of the measure in question. Since, be included without difficulty in the as I have explained, Article 113 of the EEC common commercial policy. Treaty constitutes a sufficient legal basis, recourse should not be had to Article 235 of the EEC Treaty in the area of customs nomenclature.

Community apply such a system 'for reasons 4. The continued validity of the decision of comparability' to statistics of intra- Community trade as well, it is on the basis 35. Although the contested Council of an independent legal act 12 which has no Decision must therefore be declared void, legal connection with the Convention. that does not change the legal situation under international law, according to which the Community, by adopting a convention which has meanwhile entered into force, remains bound by it. That follows from the 33. The fact that, although the conduct of principles of the general law of treaties, as the common commercial policy has been they are laid down, for example, in Article transferred to the Community institutions, 46 of the Vienna Convention on the Law of the system governing internal trade is Treaties of 23 May 1969 and Article 14 of largely governed by the EEC Treaty itself, the Vienna Convention of 21 March 1986 in particular the provisions on free governing the treaty-making powers of movement of goods, means that conclusions international organizations. The agreement cannot be drawn from the system of of the Community was indeed given external trade statistics with regard to stat- contrary to its internal procedural law on istics on internal trade. However, in that authority to conclude treaties, but that area little scope remains for intervention by infringement was not apparent to the other the Community in the economy after the contracting parties. Consequently, the end of the transitional period. Community cannot rely on that irregularity as regards those other contracting parties.