C-378/87

TOP HIT HOLZVERTRIEB v COMMISSION

OPINION OF MR ADVOCATE GENERAL MISCHO delivered on 2 March 1989 *

Mr President, 2. I refer to the Report for the Hearing for Members of the Court, the facts of the present case. I would simply mention that between October 1980 and December 1981 the applicant imported 105 consignments of unassembled wooden 1. In Case 378/87 the Court must rule on shelves originating in Romania which were an action brought by Top Hit Holzvertrieb first declared to be 'wooden construction GmbH (previously known as Intras elements' and, from May 1981, 'unas­ Holzimport GmbH), a company in the sembled wooden shelving'. In spite of course of being wound up, against a numerous physical inspections by the decision adopted by the Commission of the customs agents, the goods were classified European Communities on the basis of during the whole of that period under Article 5(2) of Council Regulation (EEC) subheading 44.28 D II of the Common No 1697/79 of 24 July 1979 on the post- Customs Tariff and admitted free of import clearance recovery of import duties or duties under the generalized system of pref­ export duties which have not been required erences. of the person liable for payment on goods entered for a customs procedure involving the obligation to pay such duties. ' Article 5(2) reads as follows:

which it requested that on the basis of zollamt sent it on that date the applicant Article5(2) of the aforementioned regu­ had knowledge of the Commission's lation no action should be taken for the contested decision and more particularly of post-clearance recovery of the import duties. the fact that the decision concerned both the application under Article 13(1) of Regu­ lation No 1430/79 3 and that based on Article 5(2) of Regulation No 1697/79. 5. Pursuant to Article 6 of Regulation No 1573/80 2the Federal Republic of Germany referred that application to the Commission of the European Communities. By the 8. On the other hand Top Hit submits that contested decision of 16 September 1985 it was only from the Hauptzollamt's (REC 5/85) the Commission declared that decision of 21 October 1987 that it learned there should be post-clearance recovery of that the Commission had adopted, pursuant the import duties in question. As always in to Article 5(2) of Regulation No 1697/79, a such a case, only the Member State which decision which concerned it directly and had made the reference to the Commission individually. was the addressee of the decision within the meaning of Article 189. Moreover, the decision was not forwarded for information to the applicant company either by the 9. To assess the question of admissibility it Commission or by the German customs is necessary to consider some of the corre­ authorities. spondence which passed between the applicant and the Hauptzollamt.

6. I shall consider the admissibility and the 10. In the fourth paragraph of page 3 of the merits of the action in turn. final decision of the Hauptzollamt of 21 October 1987 we read:

'having regard to the said decision 12. It is a fact that the Commission based (Commission Decision REC 5/85 of 16 its decision of 16 September 1985 finding September 1985), the question whether in that remission of the duties in question (as the present case the conditions for adopting well as their non-recovery) was not justified, a measure pursuant to Article 5(2) of Regu­ which is challenged in the present lation (EEC) No 1697/79 are satisfied must proceedings, not only on the basis of the essentially also be answered on the basis of abovementioned article but also on the basis the grounds which led to the rejection of of Article 13 of Regulation No 1430/79. the request made under the first paragraph of Article 13 of Regulation (EEC) No 1430/79'. 13. By a decision of 21 January 1986 the Hauptzollamt therefore rejected the request for remission of the import duties and 16. The Hauptzollamt did not, however, declared that the conditions laid down in reach a decision on the complaint on the the first paragraph of Article 13 of Regu­ basis of the latter article but continued as lation (EEC) No 1430/79 were not satisfied follows: in the present case. The grounds of that decision are essentially identical to those of the Commission's contested decision. In addition, there is the following statement: 'In those circumstances I should be obliged if you would inform me no later than 30 June 1986 whether you wish to reconsider and possibly add to the grounds of your 'Finally I would point out that in refusing objection.' the request I have taken full account of the decision adopted by the Commission of the European Communities on 16 September 17. The object of that letter was thus 1985 — REC 5/85 (Com(85) 1457 final). I clearly to inform the applicant that the also refer in this regard to Article 173 of the objection procedure, which had been Treaty of 25 March 1957 establishing the suspended at the customs authorities' European Economic Community.' suggestion, would be resumed.

'when the present decision was adopted full orities, far from considering the proceedings account was taken of the decision of the terminated, are reopening them. Commission of the European Communities of 16 September 1985 — REC 5/85 (Com(85) 1457 final).' 21. Moreover, the last paragraph of Article 173 of the Treaty provides that: 'The proceedings provided for in this article shall 19. The situation is therefore rather be instituted within two months of the confused. It could be argued on the basis of publication of the measure, or of its notifi­ the letter of 13 May 1986 that the applicant cation to the plaintiff, or, in the absence ought to have realized even then that the thereof, of the day on which it came to the Commission's decision was extremely knowledge of the latter, as the case may be'. important to its case and that it ought to In the present case the Commission has not have tried to procure it. shown that the applicant had knowledge of the precise wording of its decision at a given moment. 5

TOP HIT HOLZVERTRIEB v COMMISSION

interpreted as meaning that if all those 44.28 Other anieles of wood: requirements are fulfilled the person liable is entitled 7to the waiver of the recovery of the duty in question.' D. Other

24. Those requirements are as follows: II. Other,

(i) the non-collection of duties must have instead of assigning them to subheading: occurred as a result of an error on the part of the competent authorities them­ selves ; 94.03 Other furniture and parts thereof

(ii) the person liable must have acted in B. Other furniture. good faith, that is to say that it must not have been possible for him to detect the error made by the customs authorities; 28. The explanatory description 'unas­ sembled pinewood shelving', added from 20 May 1981 to the original description (iii) the person liable must have observed all 'wooden construction elements, pine/ the provisions laid down by the rules in spruce' and used only from 4 June 1981, did force as far as his customs declaration not influence the customs office's view as to is concerned. the correct classification.

25. Let us consider whether those three 29. In its decision of 16 September 1985 the requirements are satisfied in the present Commission did not deny that the case. competent authorities had themselves made an error and during the proceedings it admitted that the error had been 'gross and ne error of the competent authorities persistent'. I therefore do not need to dwell further on that point.

'The customs declaration of the importer of which extended from October 1980 to April the goods was, however, not without 1981, and the second period, which began ambiguity for the customs office responsible in May 1981. Let us consider Top Hit's for determining the heading or subheading attitude during the first period. under which they fell. That is particularly the case 9with the description of the goods used until May 1981, which was "wooden construction elements, pine/spruce" and the reference to subheading 44.28 D II. It was also claimed that the goods were intended 34. (a) Top Hit maintains that the classifi­ for the construction of rabbit hutches and cation of the goods was carried out at the small greenhouses.' time of the first importation in October 1980 by its agents in agreement with officials from the customs office and on the basis of a sample which it supplied. On the invoices issued by the supplier, Comtrade of 31. At the end of the seventh recital there is Vienna, which seems to be a subsidiary of a the following passage: Romanian company, the goods were described as 'vorgefertigte Holzkonstruk­ tionen, EG Zolltarifnummer BRD 4423 300 0', that is to say 'wooden préfabri­ cations, tariff Heading of the European 'it is not to be excluded that the importer Community, Federal Republic of Germany declared the goods under subheading 4423 300 0'. The Common Customs Tariff 44.28 D II of the Common Customs Tariff at the time contained a Heading 44.23 because a tariff preference was applicable to worded as follows: goods falling under that heading which did not apply to goods falling under Heading 94.03'.

lation, complete exemption, whereas as 1980 or 1981. In its rejoinder the regards Heading 44.23 the exemption was Commission refers for evidence to Annex 6 subject in 1981 to a ceiling of 6 117 000 to the applicant's reply. The document in European units of account, or question is a request for a classification DM 15 500 783 per annum and per country decision binding the customs authorities, 10 of exportation. Even if exports from attached to such a decision of the Oberfi­ Romania to the Federal Republic of nanzdirektion Munich. It relates to products Germany probably did not exceed called Rosi 1, 2 and 3, consisting of three DM 3 000 000 (on the basis of the average kinds of racks, planed only, impregnated in value of the customs declarations and order to withstand weathering and intended assuming that there were 80 consignments to be covered either by 'plexiglas' (artificial in 1981), exports may have taken place to glass) to be used as small greenhouses or by other countries of the Community so that wire meshing to be used as cages for small there may well have been a risk that the animals. ceiling could be exceeded.

OPINION OF MR MISCHO —CASE 378/87

planks, all planed, not in the nature of whether furniture falls under Heading 94.03 furniture, with six screws and groundpins as even when imported in separate pieces but accessories. It allotted them the code whether planed wooden shelves intended, number 44.28.99990 (see Annex 4 to the because of their lack of finishing, to be application). Moreover, it seems that in that placed in cellars, workshops or garages, consignment the various elements of the must nevertheless be regarded as furniture. shelving (vertical members, cross-pieces and shelves) were for the first time no longer delivered on separate palettes but in parcels containing all the individual parts of a complete rack. 45. Certainly, the man on the Clapham omnibus would hardly regard such objects as furniture. Nevertheless, could a firm specializing in the sale of articles made of wood and a customs agent be unaware that, 42. After that date the goods were always under the Common Customs Tariff, that is declared as unassembled pinewood shelving indeed so? falling under Heading 44.28 until a binding classification notice issued by the customs authorities classified them under subheading 94.03 B. 46. During the first period the German customs authorities, on at least some 40 occasions, expressly found that the goods matched the description given by the 43. In my view, one can hardly consider a applicant and that they came under firm which gives its products a description Heading 44.28 by writing on the form the corresponding precisely to their charac­ words 'wie angemeldet festgestellt' and not teristics to be acting in bad faith. That 'wie angemeldet angenommen' ('found as charge would be justified only if the firm declared' and not 'accepted as declared'). must have known that the goods ought not to have been classified under Heading 44.28. That leads me to the second limb of the second condition of Article 5(2) of 47. Moreover, the Commission has not Regulation No 1697/79, namely that the denied that, according to the commentary error in classification should not be to the Common Customs Tariff published discernable. by the German authorities, 'shelving' is to be classified under Chapter 44 so long as it is not furniture (see p. 10 of the application).

50. It follows from all the foregoing that the tariff classification of the goods in question, even when expressly declared to 52. We have seen that in any event from be 'wooden shelving', was genuinely open to May 1981 Top Hit declared its product in doubt. The error made was not 'reasonably terms corresponding to its precise charac­ detectable' by the person liable to pay the teristics but gave a wrong tariff heading. I duties since even the customs authority have also reached the conclusion that it responsible for checking the activities of the could not reasonably have detected that clearance offices did not detect it. Even a error. firm specializing in dealing in a certain kind of product cannot be expected to have greater oversight than better-informed customs officials, especially when such 53. To maintain that an importer has not officials have in fact inspected the goods in correctly observed the provisions laid down question on numerous occasions. in relation to the clearance of goods if he declares a wrong tariff heading amounts to imposing on him a 'duty of infallibility' which is not required of customs agents since Article 5(2) requires 'an error made by the competent authorities themselves'. 51. I therefore consider that it has not been established in any event that from 15 May 1981 the applicant showed bad faith in declaring its goods as shelving falling under subheading 44.28 D II. In finding in the 54. Moreover, paragraph 12 of the German fourth recital to its decision that 'Zollgesetz' provides that where the person liable to pay duties is unable to indicate the appropriate tariff heading or where he has doubts about the correct heading, the customs authorities must give him such assistance as is necessary. According to the Schwarz-Wockenfoth commentary, 11 in 'the customs declaration of the importer of such a case the customs authority must the goods was ... not free from ambiguity classify the goods itself. It may be asked for the customs authorities responsible for determining the tariff heading or 11 — Schwarz-Wockenfoth: Zollrecht mit Einfuhrumtatz- subheading under which they fell. That was steiterrecht, EWG-Zollrecht und EWG-Marktordnungsrecht, particularly so for the description of the 2. Auflage, 10. Ergänzungslieferung, September 1988, Carl Heymanns Verlag KG, Köln, Berlin, Bonn, München goods used until May 1981', (commentary on paragraph 12, point 14).

58. Consequently, the Commission must be ordered to pay the costs.