C-217/94

EISMANN ALTO ADIGE v UFFICIO IVA DI BOLZANO

OPINION OF ADVOCATE GENERAL ELMER delivered on 2 May 1996 *

Introduction document ..., previously issued by the con­ signor ...

1. In this case the Commissione Tributaria di Primo Grado di Bolzano (Tax Court of First Instance, Bolzano), Italy, has referred to the Court for a preliminary ruling a ques­ tion as to whether Article 22(8) of the Sixth The document shall bear the date and a serial Council Directive on turnover tax 1 (herein­ number and shall in all circumstances con­ after 'the Directive') precludes national legis­ tain the following information: (a) ... (b) ... lation which provides that goods being (c) ... (d) ... (e) .... transported within a Member State must be accompanied by a special document.

The relevant national rules The document shall be made out in triplicate and shall bear the receipt of the carrier or his representative at the time of dispatch of the 2. Article 1(1), (2) and (3) and Article 2 of goods. One copy shall be retained by the Presidential Decree No 627 of 6 October consignor and the other two shall be taken 1978 (hereinafter 'the Decree') provides as by the carrier who, after obtaining the con­ follows: signee's signature, shall retain one copy and hand the other to the addressee together with the goods carried.

'Article 1

and endorsed by the customs authorities foodstuffs and similar products on a door-to- relating to the first importation of the goods door basis. The Company employs salesmen into the territory of the State. who travel round and call at private houses to take orders and deliver the goods ordered, either subsequently or there and then, depending upon the stock of goods in the vehicle. Goods for export shall be accompanied by the export declaration or a copy of the invoice or in default thereof by the accompa­ nying document referred to in Article 1; in the last-mentioned case one copy of the 4. In 1993 officers of the Guardia di Finan­ document, signed by the declarant and zas (tax police) noted during a roadside endorsed by the customs authorities in con­ check and later at the Company's offices a nection with the shipment outside the cus­ considerable number of infringements in toms territory shall be returned to the con­ 1992 and 1993 of the aforementioned provi­ signor by the carrier.' sions of the Italian tax legislation on accom­ panying documents. On that occasion administrative fines were imposed upon the Company on 18 October 1993 ranging from LIT 89 124 000 to LIT 267 372 000. Ministry of Finance Circular No 2/585001 of 5 January 1993 states:

5. The Company thereupon instituted pro­ ceedings before the Commissione Tributaria '... After the opening of the Community's di Primo Grado di Bolzano claiming annul­ internal frontiers the duty to issue the ment of the fines on the ground that the pro­ accompanying document referred to in [the visions on accompanying documents were Decree] for goods transported applies only incompatible with Article 22(8) of the Direc­ to inland carriage in which the point of tive as amended by Council Directive departure and the place of destination are 91/680/EEC (hereinafter 'the Amending within the territory of the State, and to third Directive'). countries.'

'... the completion of the internal market requires the elimination of fiscal frontiers between Member States and that to that end The internal market shall comprise an area the imposition of tax on imports and the without internal frontiers in which the free remission of tax on exports in trade between movement of goods, persons, services and Member States be definitively abolished; capital is ensured in accordance with the provisions of this Treaty.'

... fiscal controls at internal frontiers will be definitively abolished as from 1 January 1993 for all transactions between Member States; 8. Article 99 of the Treaty reads as follows:

'The Council shall, acting unanimously on a proposal from the Commission and after consulting the European Parliament and the ... the achievement of the objective referred Economic and Social Committee, adopt pro­ to in Article 4 of the First Council Directive visions for the harmonization of legislation 3 of 11 April 1967, as last amended by the concerning turnover taxes, excise duties and Sixth Directive 77/388/EEC, requires that other forms of indirect taxation to the extent the taxation of trade between Member States that such harmonization is necessary to be based on the principle of the taxation in the Member State of origin of goods and

2 — At the material time this was in fact Article 8a, but following the entry into force on 1 November 1993 of the Treaty on European Union it has become Article 7a. 3 — OJ, English Special Edition 1967, p. 14.

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OPINION OF MR ELMER — CASE C-217/94

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EISMANN ALTO ADIGE v UFFICIO IVA DI BOLZANO

8. Member States may impose other obliga­ laid down in the amended version of tions which they deem necessary for the cor­ Article 22(8) of the Sixth Council Directive rect collection of the tax and for the preven­ 77/388/EEC of 17 May 1977?' tion of evasion, subject to the requirement of equal treatment for domestic transactions and transactions carried out between Mem­ ber States by taxable persons and provided that such obligations do not, in trade between Member States, give rise to formali­ Admissibility ties connected with the crossing of frontiers.

12. The Italian Government has claimed that the reference should be regarded as inadmis­ sible because the question referred to the Court was irrelevant to the decision to be taken in the national proceedings, in which the problem is whether the trade activity pursued by the taxable person should be regarded, in the light of the Decree, as a 'retail' sale or an 'itinerant' sale. According to Article 3 of the Decree, accompanying documents must be issued for use in the case of carriage of goods supplied by itinerant sale. However, the Company has claimed The question referred to the Court before the national court that what is involved is a retail sale for which, under Article 4 of the Decree, the issue of accom­ panying documents is not required.

11. By order of 12 July 1994 the Commis­ sione Tributaria di Primo Grado di Bolzano referred the following question to the Court for a preliminary ruling: 13. The Commission has contended that it is for the court of reference to assess whether a preliminary ruling is necessary to enable it to give judgment in the main proceedings.

15. The court of reference has not commit­ 'As regards the division of jurisdiction ted itself in the order for reference as to between national courts and the Court of whether this specific case is to be classified Justice under Article 177 of the Treaty the according to the rules of the Decree on itin­ national court, which is alone in having a erant sales or on retail sales. If necessary the direct knowledge of the facts of the case and national court will have to take a more of the arguments put forward by the parties, detailed decision on the point in delivering and which will have to give judgment in the judgment in the main proceedings. It has case, is in the best position to appreciate, however regarded it as relevant to its with full knowledge of the matter before it, decision to ask the Court of Justice for a pre­ the relevance of the questions of law raised liminary ruling with regard to the relation­ by the dispute before it and the necessity for ship between the Italian rules on accompa­ a preliminary ruling so as to enable it to give nying documents and Article 22(8) of the 4 judgment.' Directive. According to the Court's consis­ tent case-law therefore, there are no grounds for the Court's refusing to answer the ques­ tion put to it, which does not seem obvi­ ously irrelevant to the case pending before the national court. In Case C-387/93 Lanchero 5 the Court declared:

Substance

'The Court has consistently held that it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the subse­ 16. However, the question is formulated in quent judicial decision, to determine in the such a way that the Court of Justice is light of the particular circumstances of the requested to take a decision as to the com­ case both the need for a preliminary ruling in patibility of Italian law with Community law. As the Court has consistently held, it has no jurisdiction in a question referred to it for a preliminary ruling to give a decision 4 — [1978] ECR 2347, at paragraph 25. 5 — [1995] ECR I-4663, at paragraph 15. as to whether a national measure is consis-

tent with Community law. Such a decision is requirement is imposed for accompanying a matter for the national court alone. The documents in connection with carriage as Court of Justice is, however, competent to part of transactions carried out between provide the national court with the necessary Member States. In this connection the deci­ criteria for the interpretation of Community sive factor is not whether the specific car­ law which may enable it to determine the riage is between places in several Member issue of the compatibility of the national States inasmuch as, for example, carriage 6 rules with Community law. The question which, seen in isolation, is taking place must therefore be reformulated. between places in one Member State may also be a part of the complete carriage of goods between one Member State and another, for example where goods consigned by a vendor in Copenhagen to a purchaser in Rome are first transported by a carrier to 17. The court of reference is really wishing Genoa and there following storage are to be informed whether the requirement of reloaded on to another lorry which carries equal treatment in Article 22(8) must be them on to Rome. interpreted as meaning that it precludes national rules imposing a requirement for accompanying documents in the case of domestic transactions in the relevant Mem­ ber State when a similar requirement is not On this point I shall only observe that, in imposed on transactions carried out between view of the manner in which the question is Member States. framed by the national court there arc no grounds for the Court of Justice to consider the detailed content of the prohibition of formalities connected with the crossing of frontiers or to consider at all therefore whether the control (inspection), which is 18. It should be stressed that the question not carried out at the frontier itself but raised relates only to whether the require­ within the country, may conflict with that ment of equal treatment in Article 22(8) pre­ prohibition. cludes such national rules; it therefore does not concern an interpretation of that part of Article 22(8) which contains a prohibition of formalities connected with the crossing of frontiers. Procedure before the Court

20. The Italian Government, supported by the Portuguese Government, has claimed that the principle of equal treatment in Article 22(8) of the Directive must be under­ stood as meaning that transactions carried out between Member States must not be subjected to stricter formalities than transac­ 22. In so far as harmonization has not taken tions carried out internally within a Member place, it continues to be the responsibility of State. The purpose of the Amending Direc­ the Member States to ensure the collection tive was to ensure that in connection with and control of tax and that is what is the elimination of fiscal frontiers there expressed in the principal rule in should be no relaxation of controls on trans­ Article 22(8), according to which Member actions carried out between Member States. States may impose other obligations which The Portuguese Government has particularly they deem necessary for the correct collec­ emphasized that the Amending Directive tion of tax and to prevent evasion. The introduced a transitional system during expression 'other obligations' shows that which measures must be implemented to what is meant is such formalities for the pur­ facilitate transition to the definitive system poses of collection and control as are not for the taxation of trade between Member already regulated by the very detailed rules States. The Amending Directive should not in Articles 22(1) to (7). Moreover these to a on the contrary change or simplify the rules certain extent expressly impose on transac­ on domestic transactions. Article 22(8) can­ tions carried out between Member States for­ not therefore be accepted as containing a malities which are not imposed on domestic requirement that domestic transactions must transactions within a Member State. not be subjected to other or stricter formali­ ties than transactions carried out between Member States.

carried out between Member States, that may in the Commission's view be laid down must be understood, in accordance with the within the framework of Article 22(8) of the whole purpose of the Amending Directive, Directive. as meaning that no other or stricter formali­ ties may be imposed on transactions carried out between Member States than on transac­ tions within the Member State concerned. Article 22(8) may for example entitle a Mem­ ber State to prescribe that a taxable person is Discussion to provide a bank guarantee for his payment of value added tax and the requirement of equal treatment will then have the conse­ quence that the Member State cannot require the bank guarantee to be greater in the case of transactions carried out between Member States than in the case of domestic transac­ 26. As the Commission emphasizes, it is tions. settled case-law that the Treaty docs not pre­ vent a Member State from imposing on domestic goods higher taxes than on imported goods. Thus in paragraphs 32 and 7 33 of its judgment in Case 86/78 Peureux, the Court declared as follows: 24. On the other hand the Commission thinks that the rule does not prevent the imposition of other or stricter requirements with regard to domestic transactions than with regard to transactions carried out between Member States. The fact that so-called reverse discrimination is not 'Although Article 95 prohibits any Member excluded by the Directive may be seen in State from imposing internal taxation on connection with the fact that in practice it is products imported from other Member accepted that the Treaty does not prevent States in excess of that on national products, reverse discrimination in the fiscal sphere by it does not prohibit the imposition on domestic goods being subjected to higher tax national products of internal taxation in than goods from other Member States, the excess of that on imported products. more so as there may be reverse discrimi­ nation as regards the Member States' formu­ lation of formal rules on the collection of tax in so far as harmonization has not taken place.

The Court's conclusion was as follows: 28. That case-law regarding the general pro­ visions of the Treaty, as emphasized by the Commission, must, basically also apply with regard to the Member States' entitlement, for purposes of collection and control, to impose formalities on domestic transactions which are not imposed on transactions carried out 'Whether or not a domestic product — in between Member States. But that is only the particular certain potable spirits — is subject basis, since rules on harmonization, in this to a commercial monopoly, neither case in the field of value added tax, may be Article 37 nor Article 95 of the EEC Treaty deemed to have as their purpose to lay down prohibits a Member State from imposing on exhaustively the formalities with which the that domestic product internal taxation in Member States may require compliance also excess of that imposed on similar products as regards domestic transactions in the Mem­ imported from other Member States.' ber State concerned. We must therefore con­ sider whether the Directive, as amended by the Amending Directive, has as its objective such exhaustive harmonization, including domestic transactions within the Member States, that the Member States are precluded from imposing on domestic transactions, in 27. That case-law in the field of value added accordance with the basis mentioned, techni­ tax corresponds to the case-law in many cal requirements for the purposes of collec­ other fields. Thus the Court has declared tion and control in accordance with the that a system in which different conditions starting point mentioned, where similar apply to different goods but which does not requirements are not imposed on transac­ raise obstacles to the importation or sale of tions carried out between Member States. imported or reimported goods is not covered by the prohibition in Article 30 of the Treaty. Furthermore, in relation to the gen­ eral prohibition of discriminatory treatment, the Court has declared that 'Community law does not apply to treatment which works to the detriment of retailers who sell national products as compared with retailers who sell 29. I think the first part of Article 22(8) of imported products and which is put into the Directive shows clearly that as regards effect by a Member State in a sector which is not subject to Community rules or in rela­ tion to which there has been no harmoniza­ 8 — [1986] ECR 3231. tion of national laws' (see Case 355/85 Cog- 9 — [1987] ECR 809.

value added tax there is no intention to regu­ obligations' would have been that such obli­ late exhaustively in Community law the for­ gations did not, in trade between Member mal requirements which may be imposed for States, give rise to formalities connected with the purposes of collection and control. The the crossing of frontiers. Then, since this is provision specifically provides that the at any rate a partially harmonized sphere, it Member States may impose 'other obliga­ might be doubtful whether the general pro­ tions which they deem necessary for the cor­ hibition of discrimination also applied with rect collection of tax and for the prevention regard to the 'other obligations' referred to of evasion'. These questions are thus still left in the provision. That doubt would be basically to the Member States. increased by the fact that Article 22(1) to (7) lays down detailed rules, which might also lead one to assume that Article 22(8) was also exhaustive. The general experience is that the more a subject is expressly regulated, the greater the basis for drawing opposite conclusions. The inclusion of the second part of Article 22(8) was therefore, I think, on technical legal grounds, well calculated to 30. Since the second part of the paragraph make it clear that the general prohibition of then restricts the Member States' scope for discrimination was applicable together with laying down such rules by the condition that the prohibition of formalities connected with there shall be equal treatment for domestic the crossing of frontiers. transactions and transactions carried out between Member States, it is in my view most likely that that wording should be understood as a technical legal reiteration of the general prohibition of discrimination in the Treaty. That prohibition, as stated above, does not prevent higher taxes being imposed on domestic goods than on imported goods and even less does it therefore, we may con­ clude, prevent domestic transactions from being required to observe formalities which are not required in the case of transactions 32. It might certainly be argued that the sec­ carried out between Member States. ond part of the provision uses the expression 'equal treatment for domestic transactions and transactions carried out between Mem­ ber States' and that that must indicate that the intention was to provide not only that transactions carried out between Member States must be treated equally with domestic transactions but also that domestic transac­ tions should be treated equally with transac­ 31. One may imagine how the provision in tions carried out between Member States. In Article 22(8) would have appeared if the sec­ support of such an interpretation one might ond part had been omitted. Then the only possibly also point to the consideration that restriction, contained in the provision, of the value added tax has a neutral effect on goods Member States' scope for imposing 'other and services of domestic origin and on those

33. I must however stress that the second part of Article 22(8) of the Directive, as an exception to the main rules in the first part, 35. I must also draw attention to the twelfth must, in accordance with the Court's consis­ recital, which shows that the purpose of inter tent case-law, be strictly interpreted. alia Article 22(8) was to reconcile reduction of administrative formalities for undertak­ ings with effective control measures. Article 22(8) in this connection indicates that it is the Member States which, as long as there has been no complete harmonization of the rules for value added tax, are in the best and most immediate position to determine which control measures with regard to transactions 34. Such an interpretation moreover agrees within the relevant Member State are neces­ best both with the position of the provision sary and appropriate for guaranteeing the in Title XVIa of the Directive on transitional Member States' essential fiscal and economic arrangements for the taxation of 'trade interests in a correct collection of value between Member States' and with the pur­ added tax and the prevention of evasion. pose of the provision. The Amending Direc­ tive, which gave the provision its present form, did not bring about any complete har­ monization of the laws of the Member States' on value added tax. Reference is made to a transitional phase pending the determi­ nation of the definitive system that will bring about the objectives of the common system of value added tax on goods and services 36. To sum up I think in view of all the cir­ supplied between Member States (see the cumstances that the answer to the question eighth recital to the Amending Directive). raised should be that the requirement of The principal purpose of the Amending equal treatment in Article 22(8) of the Direc­ Directive was, as appears from the first, sec­ tive must be interpreted as meaning that it ond and third recitals, (a) to complete the does not preclude national rules which internal market, (b) to eliminate fiscal fron­ impose a requirement for accompanying tiers between Member States, (c) to abolish documents in connection with domestic the imposition of tax on imports and the transactions in the Member State concerned remission of tax on exports, and (d) to abol­ where no corresponding requirement is ish fiscal controls at internal frontiers for all imposed with regard to transactions carried transactions carried out between Member out between Member States.