C-269/90

OPINION OF MR JACOBS —CASE C-269/90

O P I N I O N O F MR A D V O C A T E GENERAL JACOBS delivered o n 11 J u l y 1991 *

* Original language: English.

I - 5480

TECHNISCHE UNIVERSITÄT MÜNCHEN

4. The University applied for customs are very similar, and the differences are not clearance of the instrument on 1 June 1979, material in the present case. In what 5 October 1979 and 23 March 1981. At first follows, I shall refer to Regulation the Hauptzollamt München-Mitte took the N o 2784/79.) view that the instrument could be admitted duty-free under Regulation N o 1798/75. Subsequently, however, the Hauptzollamt decided that the instrument could not be exempted from customs duties. It did so on the basis of Commission Decision 6. A group of experts composed of repre- 82/86/EEC of 23 December 1981 (Official sentatives of the Member States meeting Journal 1982 L 41, p. 53), which had held, within the framework of the Committee on in connection with a different importation, Duty-Free Arrangements was consulted, as that the JSM-35 C could not be imported provided in Article 7(5) of Regulation duty-free because an instrument currently No 2784/79. It concluded that the Philips being manufactured in the Netherlands by PSEM 500 X was an apparatus of scientific Philips Nederland BV (the PSEM 500 X) value equivalent to the JSM-35 C. Acting was of equivalent scientific value. in accordance with Article 7(6), second Accordingly, by notices dated 14 April, 15 subparagraph, of the regulation, the April and 22 June 1982, the Hauptzollamt Commission adopted Decision 83/348/EEC demanded customs duties of D M 31 110.20 of 5 July 1983 establishing that the together with DM 3 746.50 by way of apparatus described as 'JEOL — Scanning value-added tax. Electron Microscope model JSM-35 C ' may not be imported free of Common Customs Tariff Duties (Official Journal 1983 L 188, p. 22). That decision was again based on the ground that the Philips machine was of equivalent scientific value.

10. The Bundesfinanzhof is aware that the Court has hitherto taken a restrictive attitude as regards the extent to which it is willing to review the substance of a decision refusing to grant exemption from customs 8. As a result of Commission Decision duties on the ground that equipment of 83/348 the Hauptzollamt confirmed its equivalent scientific value is produced in the decision to charge customs duties on the Community. The Bundesfinanzhof cites the apparatus in question. The University judgment in Case 303/87 Universität appealed to the competent Finanzgericht. Stuttgart v Hauptzollamt Stuttgart-Ost [1989] T h e Finanzgericht took the view that the ECR 715, in which the Court held, Philips apparatus was not of equivalent following its previous case-law, that: scientific value to the JEOL apparatus and therefore quashed the decision charging customs duties on the latter. The Finanz- gericht did not consider itself bound by Commission Decision 83/348, which was, in its view, contrary to Community law and therefore invalid. It also considered that the 'Given the technical character of the exam- decision was not a rule of law and was ination to determine whether or not binding only on the Member States as particular apparatus are equivalent, [the addressees. Presumably it did not regard Court] cannot, save in the event of manifest itself or the Hauptzollamt as part of the error of fact or law or misuse of power, find German State. It must be pointed out, fault with the substance of a decision however, that all Community measures are adopted by the Commission in conformity binding on all the organs of the Member with the opinion of the Committee on States, unless declared invalid, and that Duty-Free Arrangements.' national courts do not have the power to declare Community measures invalid: Case 314/85 Foto-Frost v Hauptzollamt Lübeck-Ost [1987] ECR 4199.

'Limited review in accordance with the 14. Moreover, the formula used by the previous case-law of the Court of Justice Court in the Universität Stuttgart case (cited would mean that a legally incorrect decision above, paragraph 10) and in its earlier of the Commission adversely affecting judgment in Case 216/82 Universität Community citizens would be upheld Hamburg v Hauptzollamt Hamburg- merely because the mistakes on the part of Kebrwieder [1983] ECR 2771 is infelicitous the Commission were not manifest. The in so far as it suggests that the Court cannot more difficult the technical questions to be invalidate a Commission decision containing decided the more immune from challenge an error of law, unless the error is manifest. the Commission's decision would be. It is That statement of the law should not, I questionable whether such a restriction of think, be taken too literally. I take it to be the legal protection of Community citizens the case that any decision of a Community is compatible with the constitutional institution that produces binding legał principle guaranteeing effective legal effects, even a decision on a technical protection which is recognized by question, is liable to annulment on the Community law.' ground that it contains an error of law, including an error that is not manifest. It may be noted that the French text of the judgment in the Stuttgart case (but not in the Hamburg case) refers not to a manifest error of fact or law but to an 'erreur manifeste d'appréciation'.

12. The Bundesfinanzhof points out that questions concerning the customs classi­ fication of goods are often of an equally technical nature and yet there is no support for the view that the decisions of the admin­ istration in that field are subject to such limited judicial review.

16. Given these conflicting considerations, it is desirable that issues such as the equiv- alence of two scientific instruments should in principle be submitted to an independent body composed of persons possessing the 18. Article 6 of Regulation No 2784/79 necessary technical expertise. In so far as provides that in order to obtain duty-free those issues are entrusted to such a body admission of a scientific instrument or and that body conducts its proceedings in apparatus the establishment or organization accordance with the relevant legislation and to which the goods are consigned ('the whatever general principles of law are importing establishment') must submit an applicable, takes into account all relevant application to the competent authority of matters, disregards all matters that are not the Member State in which it is situated. relevant and produces a decision that is at The application must contain various items least sufficiently reasoned to allow some of information relating to the instrument form of judicial review, then I would accept or apparatus in question, including a that the Court should be reluctant to description of the objective technical interfere with the resulting decision and characteristics on the basis of which it is should certainly not substitute its own considered scientific. The application must opinion on technical questions for that of also state the use for which the instrument the experts. It would, in those circum- or apparatus is intended and give a detailed stances, be legitimate for the Court to description of the project for which it is confine its role to reviewing whether the intended. Article 6(2)(j) of the regulation decision was vitiated by an error of law, in requires the importing establishment to particular a procedural error, or whether it state : was manifestly wrong.

In addition, 'documentary evidence 5. If, within the period of three months laid providing all relevant information on the down in paragraph 4, a Member State has characteristics and technical specifications of sent the Commission objections regarding the instrument or apparatus must be the duty-free importation of the instrument furnished with the application'. or apparatus under consideration, the Commission shall as soon as possible notify a group of experts composed of represen- tatives of all the Member States, who shall meet within the framework of the 19. Article 7(1) of Regulation No 2784/79 Committee on Duty-Free Arrangements in requires the authority to which the order to examine the matter. application for duty-free admission is submitted to take a decision on the application itself where the information at its disposal enables it to assess whether the The objections referred to in the preceding instrument is scientific and whether subparagraph must include a statement of instruments of equivalent value are currently the grounds therefor. Such grounds must being manufactured in the Community. indicate either why the instrument or Where that authority is unable to take a apparatus concerned should not be regarded decision it must, under Article 7(2) of the as being scientific, or should indicate the regulation, forward the application to the exact type of the instruments or apparatus Commission, together with the relevant manufactured in the Community which are technical documents. The Commission must regarded as having a scientific value equal then set in motion the procedure laid down to that for which duty-free admission is in Article 7(3) to (7). I will quote para- requested, together with the name or graphs (3) to (5) of Article 7 verbatim: business name and address of the Community firm or firms who can supply them. In the latter case, the technical literature relating to the instruments or apparatus under consideration manu- '3. Within two weeks of the date of receipt factured in the Community should be of the application, the Commission shall forwarded to the Commission as soon as dispatch a copy to each of the other possible. Member States together with the relevant documentation.

21. As regards the working methods of the group of experts referred to in Article 7(5) of Regulation N o 2784/79, the only in- formation available to the Court is that provided by the Commission. The group '. .. on the basis of information received proceeds in accordance with the Rules of from Member States, apparatus of scientific Procedure of the Committee on Duty-Free value equivalent to the said apparatus, Arrangements of 17 September 1975. It capable of being used for the same appears that the Committee's Rules of purposes, are currently being manufactured Procedure are unpublished. It seems that no in the Community; whereas this applies, in formal qualifications are required for particular, to the apparatus PSEM 500 X membership of the Committee. Article 7 of manufactured by Philips Nederland BV'. Regulation N o 1798/75 merely states that the Committee 'shall consist of represen- tatives of the Member States with a representative of the Commission as chairman'. Article 6 of the Committee's Rules of Procedure provides that each Member State may be represented by a maximum of five officials. The Commission 23. The minutes of the 122nd session of the says that the persons appointed are normally Committee on Duty-Free Arrangements do officials of the respective Ministries of not say much about the examination to Science, Industry, Trade or Finance. In fact which the University's application was it seems that the participants at the subjected. They simply state that the Philips Committee's 122nd session held on 30 and PSEM 500 X was considered to be of equi- 31 May 1983, at which the application made valent value (see item 2.12 on page 5 by the University was examined and the relating to procedure 004/83). According to minutes of which have been provided to the the Commission, applications for duty-free Court by the Commission, were all officials admission are normally dealt with by the of the Ministries of Finance, Trade or Committee at two sessions or more in order Industry and the like. The Commission to allow sufficient time for further inquiries accepts that the officials did not have any to be made. The Commission states that in particular scientific expertise. the present case, however, the application was dealt with at one session only because it was simply a question of confirming a previous decision. By that the Commission was presumably referring to Decision 82/86/EEC of 23 December 1981 (already 22. Decision 83/348 was adopted on 5 July cited in paragraph 4 above), which had 1983 in accordance with a finding made by held, in relation to a different application,

24. How did the Committee arrive at the conclusion, at its 122nd session, that the conditions for duty-free admission were not satisfied? Did it simply consider that it was 25. If the Committee did discuss such issues bound by the earlier decision or did it in the present case, the question arises on genuinely reconsider the matter in the light what evidence it based its findings. The of the arguments advanced by the Committee was presumably provided with University? if it did reconsider the matter, the information that the University enclosed on what evidence did it base its finding? with its application for duty-free admission. The minutes of the 122nd session are It also had information supplied by the revealing as to the general manner in which Netherlands, the Member State that the Committee proceeds. At that session 18 objected to duty-free admission. That in- applications were dealt with and in four formation included a document entitled cases the Committee found that an 'Application for the duty-free importation of instrument of equivalent value was being JSM-35 C electron microscope into Federal manufactured in the Community. One of Republic of Germany, file No 283-3618'. the four cases concerned the importation That document appears to have been made by the University. In the other three prepared by Philips Nederland BV, the the minutes state that one or more national manufacturer of the instrument held to be delegations 'confirmed' that an instrument of equivalent scientific value to the manufactured in the Community was of JSM-35 C. The author of the document equivalent value. On the basis of that had clearly had access to the University's 'confirmation' the Committee concluded in application and the accompanying docu- each case that the conditions for duty-free mentation. Not surprisingly, he seeks to admission were not satisfied. Although the refute any argument suggesting that the minutes of a committee meeting do not Japanese instrument was superior and necessarily reflect the extent of the debate arrives at the conclusion that the two conducted within the committee, the instruments were of equivalent value. That minutes of the 122nd session of the document appears to be the principal item Committee on Duty-Free Arrangements of evidence on the basis of which the certainly create the impression that, if a Committee could have decided that the single national delegation positively avers conditions for duty-free admission were not that a particular instrument of Community satisfied. The Commission says that it does origin is equivalent in value to the not know whether the document was shown instrument for which duty-free admission is to the University and it is in any event sought, the Committee's practice is to common ground that the University was accept that averment without further debate. given no opportunity to challenge the views There is nothing in the minutes to indicate expressed in the document.

28. In his Opinion in the same case 27. The second indent of Article 3(3) of Advocate General Mancini considered the Regulation N o 1798/75 provides in argument to the effect that apparatus should substance that 'equivalent scientific value' be compared on the basis of general criteria shall be assessed by comparing the charac- rather than on the basis of the scientific teristics and specifications of the imported research project of the importing estab- instrument with those of the instrument lishment. He stated as follows: manufactured in the Community in order to determine whether the latter could be used for the same scientific purposes as those for which the imported instrument is intended and whether its performance would be 'I disagree with that argument. In my view, comparable. Following the amendments it is contrary both to the very terms of the introduced by Regulation No 1027/79 the rules in question, which require an corresponding provision is the third indent assessment of the particular characteristics of Article 3(3), in which the expression of an apparatus in relation to the specific 'characteristics and specifications' is work which is to be carried out, and to the replaced by the expression 'essential purpose for which those rules were adopted. technical characteristics'. In Case 4/84 The purpose of Regulation N o 1798/75 is Johann-Wolfgang-Goethe-Universität v Haupt- in fact to facilitate the free exchange of zollamt Frankfurt am Main-Flughafen [1985] ideas as well as the exercise of cultural ac- ECR 991 the Court ruled as follows: tivities and scientific research within the

Community, by allowing "by all possible Committee examined whether the Dutch means" the admission of instruments free of instrument would be of the same value as customs duties. It is therefore safe to assume the Japanese instrument with regard to the that the legislature did not consider that it specific purposes for which the University was lawful or even proper to make only a required an instrument. On the contrary, summary examination of research projects everything suggests that the Committee in order to make customs officers' work simply considered itself bound by a previous easier. On the contrary, everything suggests decision relating to a different importation. that the legislature envisaged an extremely The Commission expressly states in its thorough examination.' replies to written questions put to it by the Court (see footnote 2 on page 2 of the replies) that, whereas applications are in principle always dealt with at two or more sessions of the Committee, the University's application was dealt with at only one session because it was a question of confirming an earlier decision, namely 29. As Advocate General Mancini pointed Decision 82/86. That certainly conveys the out in the same Opinion, it would be impression that little attention was paid to illogical to require the importing estab- the specific scientific purposes for which the lishment to furnish so much information University required the instrument, since its about the instrument that it wished to work could of course have been very import, about the equipment available in the different from that of the importing estab- Community and about the nature of its lishment in the previous case. scientific work, if the issue of equivalence were to be resolved by anything less than a thorough examination focusing on the specific work of the importing estab- lishment. It must be remembered that Article 6(2)(j) of Regulation No 2784/79 requires the establishment to state 'detailed reasons why an instrument or apparatus which is 31. In fact, a comparison of the preambles available in the Community would not be to the respective decisions suggests, at least suitable for the particular scientific work to to a layman, that the requirements of the be undertaken'. (I note in parentheses that importing establishments in the two cases the word 'detailed' does not occur in the were indeed different. In the case of corresponding provision of Regulation Decision 82/86 the instrument was required No 3195/75, namely Article 3(2)(g) for 'the qualitative and quantitative analyses thereof.) of crystal phases brought about by heat treatment in glasses and glass ceramics served (sic) for the solidification of highly radioactive nuclear waste'. In the case of Decision 83/348 the University required the instrument for 'the study of electrochemical processes, plastics, photographic emulsions 30. In the present case there is nothing, and biological systems and also for the either in the statement of reasons on which qualitative and quantitative analysis of Decision 83/348 was based or in the inorganic, organic and biological systems minutes of the meeting at which the involved with high depth of focus and Committee on Duty-Free Arrangements sometimes in very low temperatures dealt with the case, to suggest that the (-150°C)'.

33. It is also necessary for me to consider whether there were any other defects in the 35. The fact that the members of the procedure described above such as to render Committee do not themselves appear to be the contested decision invalid. Although the scientists is not necessarily decisive. As the issues which I propose to consider have not Commission points out, an expert in one been specifically raised by the Bundesfi- branch of science may not be qualified to nanzhof, it seems to me that the answer to speak on issues relating to a different field the question it has referred, concerning the and it would be impossible to ensure that all proper scope of judicial review of a decision areas of specialization were represented; involving technical expertise, must depend what matters is that the members of the upon an examination of the nature of the Committee should have access to inde- body taking the decision and of the guar- pendent expert assistance within the antees provided in the procedure leading to national administrations or perhaps from the adoption of the decision. universities and similar bodies.

37. That the members of the Committee consultations by telephone with experts at should, via their national administration, the Joint Research Centre in Ispra). And in consult manufacturers established in their the proceedings before the Court the respective countries is not in itself objec- Commission has relied almost totally on tionable; Article 7(1) of Regulation documentation supplied by Philips, without N o 2784/79 expressly contemplates even seeming to be aware that any views 'consultation with the trade circles emanating from such a source must be concerned', and such consultation could treated with the caution habitually reserved clearly be useful or even essential for a well for the evidence of an interested party. informed decision to be taken. What would be objectionable would be for preponderant weight to be given to the views of the Community manufacturer who has such an obvious interest in the outcome of the proceedings, and the absence of any objective, independent assessment of the 39. In the circumstances I am not satisfied respective qualities of the two instruments that Decision 83/348 can be said to have for the purposes in question by persons been based on the objective findings of an possessing the necessary scientific independent group of persons possessing the knowledge. necessary technical expertise. On that ground too I reach the conclusion that the decision is so flawed that it must be declared invalid. Moreover, if the view were taken that that defect is not of such a nature as to affect the validity of the decision, it must in any event remove any justification there may otherwise have been for limiting the scope of review by the Court of the substance of the decision. 38. In the present case there cannot, I think, be any doubt that preponderant weight was given to the views of Philips, the Community manufacturer. At every stage of the proceedings the written submissions prepared by that company seem to have played a decisive role. Thus, when the VI — The right to a fair hearing Netherlands objected to the duty-free admission of the Japanese instrument (see the letter of 31 March 1983 from the Netherlands Ministry of Finance, annexed to the Commission's observations), it based its objection solely on the aforesaid report prepared by Philips. As I have already 40. I now turn to the procedural guarantees observed, that report seems to have been afforded under the procedure, and in the the only item of evidence on which the first place to the question whether the Committee on Duty-Free Arrangements University's right to a fair hearing was could have based its finding on the issue of infringed, in particular by the fact that it equivalence. Certainly, if there was any was given no opportunity to comment on other scientific evidence the Commission the aforesaid document in which Philips has not drawn the Court's attention to it rejected any suggestion that the Japanese (apart, that is, from some vague reference to instrument was superior to its own.

41. On that point the case-law of the Court formation supplied to the Committee, where is, as it stands, perfectly clear. On several practicable, before the Committee reaches occasions, in cases concerning duty-free its decision. importations, the Court has been content to observe, when the principle audi alteram partem has been invoked, that the relevant regulations do not grant the importing establishment the right to a hearing or the right to challenge arguments to the effect 43. However, I do not consider that the that the instrument in question is not right to be heard is required by law in such eligible for duty-free admission: see Case a case. It seems to me that, whereas such 185/83 University of Groningen v Inspecteur a safeguard is mandatory in judicial der Invoerrechten en Accijnzen [1984] ECR proceedings and in administrative 3623, at paragraph 20; Case 2 0 3 / 8 5 Micolet proceedings that may lead to the imposition Instrument v Hauptzollamt Frankfurt am of a fine or other penalty, it is not essential Main-Flughafen [1986] ECR 2049, at to grant a hearing or the right to challenge paragraph 15; and Case 43/87 Nicolet opposing arguments in administrative Instrument v Hauptzollamt Frankfurt am proceedings of the type in issue, where the Main-Flughafen [1988] ECR 1557, at para- importing establishment cannot suffer any graphs 13 and 14. consequence more serious than the loss of a benefit such as the right to import a piece of equipment duty-free. There is an obvious difference between the present proceedings and proceedings under the competition rules of the Treaty, or indeed anti-dumping proceedings, since in the present pro- ceedings all that is at stake is the possibility 42. After some hesitation I am satisfied that of benefiting from relief from a duty which the above case-law must be followed. is generally imposed. In the present Having regard to the number of decisions proceedings the University's right to be that have to be taken, one must be wary of heard was in my view therefore sufficiently placing on the administration an excessive protected by the fact that the information burden by insisting on a time-consuming accompanying its application for duty-free procédure contradictoire under which the admission, in which it was able to set forth importing establishment would be allowed its point of view, was forwarded to the to counter arguments adduced by the Commission and to the Committee on Community manufacturer opposed to Duty-Free Arrangements, in accordance duty-free admission. The fact that the regu- with Article 7(2) and (3) of Regulation lations do not establish such a procedure is No 2784/79. not of course decisive, since it could be argued that a general principle of law requires the importing establishment to be given a hearing even though the legislature has not made any express provision to that effect. Advocate General VerLoren van VII — The reasoning of the decision Themaat appears to have taken such a view in the University of Groningen case (cited above in paragraph 41). I can see also that it might be preferable, in the interests of good administration, for an applicant for 44. T h e next issue is whether Decision duty-free admission to receive the in- 83/348 contained an adequate statement of

the reasons on which it was based. Certainly statement of the scientific grounds that the reasoning found in the preamble to the justify the finding of equivalence. In this decision was laconic, to say the least. On respect it is interesting to compare the the issue of equivalence the fourth recital fourth recital in the preamble to Decision simply states that 'on the basis of infor- 83/348, which deals so summarily with the mation received from Member States, issue of equivalence, and the third recital, apparatus of scientific value equivalent to which contains a fuller, albeit brief, the JEOL JSM-35 C, capable of being used statement of the reasons for regarding the for the same purposes, are currently being JSM-35 C as a scientific instrument. manufactured in the Community', in particular the Philips PSEM 500 X. The decision does not indicate why the Philips instrument was equivalent in scientific value 47. The inadequacy of the reasoning might to the JEOL instrument and it does not have been compensated for if 'the infor- state what 'the information received from mation received from Member States' (i. e. Member States', on which the finding of the report submitted by Philips) had been equivalence was based, consisted of. communicated to the University, which Moreover, the minutes of the 122nd session would then have known the scientific of the Committee on Duty-free grounds on which its application for Arrangements are just as silent in that duty-free admission was refused. Communi- respect. cation of the Philips report to the University would thus have fulfilled one of the essential functions of the requirement of reasoning, inasmuch as it would have 45. As things stand at present the case-law enabled the University to ascertain whether of the Court is, once again, perfectly clear. the decision was well founded or whether it On several occasions the Court has held was vitiated by an error that would allow its that a statement of reasons similar to the legality to be challenged (see Case 195/80 one contained in Decision 83/348, though Michela Parliament [1981] ECR 2861, at laconic, was sufficient to comply with the paragraph 22). minimum requirements of Article 190 of the Treaty: see University of Groningen (cited above in paragraph 41), at paragraph 39; Case 203/85 Nicolet Instrument (cited above in paragraph 41), at paragraph 11; and VHI — Implications for the scope of judicial Universität Stuttgart (cited above in review paragraph 10) at paragraph 14.

on the grounds that I have suggested, I will reviewability of the findings of medical briefly state my views on the issue. I will committees in the admittedly different field merely observe that in my opinion the policy of staff cases. The Court has declined to of confining judicial review to the question review the medical appraisals of such whether a decision is vitiated by an error of committees and has held that review must law or whether it is manifestly wrong would be confined to questions concerning the be justified if it were clear that the constitution and proper functioning of the Committee on Duty-free Arrangements acts committees. But the Court justified limiting on the basis of impartial, expert advice and judicial review in that way by emphasizing gives genuine consideration to the evidence that the relevant legislation provides for an adduced in support of an application for appropriate complaints procedure and duty-free admission and if a satisfactory strives carefully to ensure the balance and statement of reasons is given for the ensuing objectivity of medical committees: see Case decision. For the reasons given above, I 156/80 Morbelliw Commission [1981] ECR cannot see that those requirements are 1357, at paragraph 19, and Case 265/83 satisfied at present. 5«« v Commission [1984] ECR 4029, at paragraph 11. For the reasons given, it is clear that no such justification can be pleaded for limiting the scope of judicial 49. On this point it is instructive to review of decisions on technical questions compare the Court's case-law on scientific taken by the Committee on Duty-Free instruments with its case-law concerning the Arrangements.