C-290/97

GEORG BRUNER v HAUPTZOLLAMT HAMBURG-JONAS

OPINION OF ADVOCATE GENERAL FENNELLY delivered on 16 July 1998 *

1. The present case concerns the customs 3. On 29 April 1997, in proceedings brought classification of frozen hind cuts of chicken, by the applicant against a decision of the for the purposes of the payment of export Netherlands Produktschap voor Pluimvee en refunds. Eieren (Poultry and Eggs Board) ordering him to repay export refunds granted in respect of the export in February 1988 of three con­ signments of chicken cuts similar to those at issue in the German proceedings, the College van Beroep voor het Bedrijfsleven (Adminis­ trative Court for Trade and Industry) found I — Facts and procedural background in favour of the applicant, and classified the cuts under product code 0207 41 11 000.

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OPINION OF MR FENNELLY — CASE C-290/97

term "quarters" (of chicken) also includes export refund'. Article 9(2) charges the cuts of poultry not yet wholly separated from Council with adopting the necessary general each other ("posteriori") as described more rules. Article 11(1) stipulates that '[the] gen­ precisely in the grounds of this order?' eral rules for the interpretation of the Common Customs Tariff and the special rules for its application shall apply to the tariff classifica­ tion of products covered by this Regulation; the tariff nomenclature resulting from the application of this Regulation shall form part of the Common Customs Tariff'.

5. Written and oral observations were sub­ mitted by the Commission; the applicant sub­ mitted oral observations.

9. Commission Regulation ( EEC ) 18 March 1988 fixing the export refunds No 3846 / 87 of 17 December 1987 establishing on poultrymeat (hereinafter 'Regulation an agricultural product nomenclature for No 717/88') provided that an export refund export refunds (hereinafter 'Regulation of ECU 43 / 100 kg was payable for exports to 4 No 3846 / 87' ), though based on the com­ Equatorial Guinea for chicken cuts with the bined nomenclature , sought to take account product codes 0207 41 11 000 (halves or quar­ of the specificity of the export refund system , ters) and 0207 41 71 100 (halves or quarters and in particular the need to make subdivi­ without rumps ), but none for cuts with the sions in the combined nomenclature for such product code 0207 41 71 900 ( other cuts , products . The relevant sections of the nomen­ frozen, of fowls of the species Gallus domes- clature for the poultrymeat sector, in the ver­ ticus, with bone in). Annex II to this Regula­ sion established by this Regulation , were as tion amended part 8 ( 'Poultrymeat' ) of the follows: agricultural products nomenclature estab­ lished by Regulation No 3846/87, though not in any respect which is material to the present '0207 Meat and edible offal, of the proceedings . poultry of heading No 0105, fresh, chilled or frozen:

' 0207 4171 — — — — —Other:

0207 41 71 100 — Halves or quarters without the rump 0207 41 71 200 — Cuts consisting of whole leg or part of a leg and part of 14. At the hearing, the applicant stressed that the back, where the weight of the part in the poultrymeat industry chickens are of the bach does invariably cut transversely, i. e., perpendicular not exceed 25% of to the spine, and argued that the Commis­ the total weight sion's definition would not correspond with 0207 41 71 300 — Cuts consisting of the products which are found on the market . both unseparated He also relied on the General Rules for the hindquarters, with Interpretation of the Combined Nomencla­ or without the ture , and in particular Rules A 2(a)andA 3(b). rump 0207 41 71 900 — Other.'

III — Arguments of the parties

16. The Commission denies that commercial 18. As noted above, Article 11(1) of Regula­ practice is relevant to the customs classifica­ tion No 2777/75 applies the general rules for tion of the products in question. Further­ the interpretation of the Common Customs 10 Tariff and the special rules for its application more, in its view the Court in Voogd held that national courts were only obliged to take to the classification of products in the agri­ account of commercial practice whenever the cultural product nomenclature for the pur­ Community legislator had implicitly referred poses of export refunds. Article 1(1) of Regu­ to the customs of each country, which was lation No 2658/87 established, with effect from 1 January 1988, the combined nomen­ not the case here. Nor is General Rule A 2(a) clature 'to meet, at one and the same time, the pertinent either, in accordance with Haupt- 11 requirements both of the Common Customs zollamt Mannheim v Boehringer and Tariff and of the external trade statistics of the because the product is not in any case 'unfin­ 12 Community'. The General Rules for the ished'. General Rule A3 is inapplicable Interpretation of the Combined Nomencla­ because the chicken cuts could not be classi­ ture were set out in Annex I to this latter fied under two or more different positions. Regulation. Rule 1 provides as follows: Regulation No 96/89 is inapplicable, as it was not in force at the time of the exportations. The Commission therefore concludes that the exported chicken cuts should be classified in the residual product code 0207 41 71, more particularly code 0207 41 71 900. '[The] titles of sections, chapters and sub­ chapters arc provided for ease of reference only; for legal purposes, classification shall be

21. These notes seek to provide guidance as the meaning to be attributed to the terms of the headings and subheadings, whereas the remaining general rules seek to regulate situ­ ations which cannot be resolved on the basis of the headings, subheadings, section notes or 19. In the present case, no heading or sub­ chapter notes, even when interpreted in the heading refers expressly to 'hind cuts of light of the Explanatory Notes, such as incom­ chicken separated at the bone and held together plete, unfinished, unassembled or mixed arti­ naturally by the skin of the back'. Nor does cles, or those which are prima facie classifi­ any section or chapter note of the Harmon­ able under two headings. It appears to me, ised System deal with the classification of therefore, to be more in keeping with Rule 1 chicken cuts; indeed, while the Harmonised to base the interpretation of a product code, System in the version in force at the material where possible, on the relevant Explanatory time had separate subheadings for frozen cuts Notes, before resorting to the remaining rules. and offal, excluding liver, of chickens (0207.41), Such an approach is not in any way inconsis­ 15 turkey (0207.42), and ducks, geese or guinea tent with that of the Court in Voogd, where fowl (0207.43), it did not distinguish between the Court relied on General Rule A 3(b). In 13 the various cuts of chicken, which, presum­ Voogd, the Court was faced with two prod­ ably, explains the necessity for more specific ucts which did not, prima facie, fall into any Community classification provisions. single product code which could be inter­ preted in the light of an Explanatory Note,

22. A general prefatory observation, not described as a chapter note, to chapter 2 ['Meat and edible meat offal'] of the Explanatory Notes to the Harmonised System published by the Customs Cooperation Council (here­ This subheading includes: 16 inafter 'CCC' ) states that '[this] Chapter applies to meat in carcasses (i. e. the body of an animal with or without the head), half- carcasses (resulting from the lengthwise split­ ting of a carcass), quarters, pieces etc.... suit­ able for human consumption'. While useful 1. fowl halves produced by the symmetrical as an indication of the interpretation of the division of the carcase into right and left term 'half' in this context, it does not provide halves; any guidance to the meaning of 'quarter', which, at least in the common parlance, could be said to result from the splitting of a carcass both longitudinally and transversely. In any case, the Explanatory Notes to the Harmon­ ised System do not in any way restrict the notion of 'quarter' in the manner contended 2. hindquarters consisting of the drumstick, by the Commission and the national court. leg, rear part of the back and rump, as well as forequarters consisting essentially of one half of the breast with the wing attached.'

23. The Explanatory Notes to the Combined Nomenclature of the European Communities 24. It is clear from the order for reference of the national court and the observations of the parties that the chicken cuts at issue corre­ 16 — I am somewhat surprised that the Commission should, in its spond to the definition of 'hindquarters' pro­ written observations, cite an 'unofficial version of the Explan­ atory Notes to the Harmonised System' published by the vided in the Explanatory Notes to the Com­ German Federal Finance Ministry, in preference to the offi­ bined Nomenclature, subject to the important cial version published by the CCC, particularly as the two texts appear to be at variance. proviso that the two hindquarters arc not

completely separated, as the legs are held the exceptional circumstances of the present together naturally by the skin. While the use case, be admitted, it is significant that the of the singular throughout the description of Commission's Explanatory Note to product the term 'hindquarter' -would indicate that the code 0207 41 11 000 was subsequently Explanatory Notes envisaged primarily sepa­ amended from '[this] subheading includes ...' 19 rated quarters, there is, in my view, nothing to '[this] subheading covers ...'. This modi­ either in the text of the Note or in the Regu­ fication of the terms of the Note is, in my lations the application of which the Note was opinion, perfectly consistent with the view intended to facilitate, to exclude unseparated that the definition of 'quarters' which applied hindquarters from the scope of product prior to the adoption of Regulation No 96/89 code 0207 41 11 000. In particular, no con­ was sufficiently wide to include chicken cuts vincing explanation has been advanced as to such as those at issue, but was subsequently why a single such cut should be treated any tightened to take account of the creation of a differently from two hindquarters of which more specific product code for these cuts. In the skin has been cut; it has not been argued any case, the classification of these cuts under that there is any material difference, such as subheading 0207 41 71 rather than in weight or value, between these two cuts. 0207 41 11 000is, in my view, adequately explained by the restriction of the former to cuts which include the rump, while the new product code 0207 41 71 300 covers unsepa­ rated hindquarters 'with or without the rump'. I might add, the Commission did not argue that Regulation No 96/89 sought to modify the entitlement to export refunds of any par­ 25. In favouring the exclusion of the cuts at ticular category of poultry products, as dis­ issue from product code 0207 41 11 000, the tinct from fixing the rate of such refunds, nor national court was influenced, inter alia, by would the text of the Regulation provide any the fact that Regulation No 96/89 did not support for that view. classify such cuts under 'Halves or quarters', but under residual subheading 0207 41 71 ('Other'). Such ex post facto reasoning does not, however, appear to be compatible with 17 the Court's judgment in Voogd, where the Court expressly excluded reliance on a sub­ sequent regulation in the interpretation of a pre-existing customs situation.

scheme, purpose and wording of the relevant conclusions I have reached on the basis of the provisions of Regulations Nos 2777/75 and Note to product code 0207 41 11 000, it may 3846/87. In particular, the applicant has plau­ be useful briefly to examine the application of sibly suggested, without being contradicted General Rules A 2(a) and A 3(b). on this point by the Commission, that product code 0207 41 71 900 is residual in character, and is mainly intended to cover, for the sake 20 of completeness, waste products the export of which the Community is not minded to promote. Thus, at the material time refunds 29. General Rule A 2(a) refers to 'incomplete were available under Regulations Nos 717/88 or unfinished' articles; while the applicant has and 3216/88 in respect of the export of all the argued that the cuts he exported have the other cuts of frozen chicken with bone in, 'essential character' of separated hindquarters, with the exception of products under product he has not shown in what way these products code 0207 41 71 900. It has not been con­ are either incomplete or unfinished so as to tended at any stage that the cuts at issue in justify the application of this rule in the first the present proceedings are waste products of place. Furthermore, as the Commission has the chicken processing industry; it would pointed out, in Hauptzollamt Mannheim v therefore seem to be wholly anomalous to Boehringer 2I the Court recognised that this treat them as such for the purposes of the rule does not normally apply to products in export refund regime, as the Commission is Chapters 1 to 38 of the combined nomencla­ suggesting. ture; the applicant has not shown the exist­ ence of any exceptional circumstances which would require its application in the present case. It follows that, in my view, Rule A 2(a) does not apply.

ably, be classified under two or more head­ determine the goods with which the presented ings at the same time, corresponding to the goods are most akin ... Kinship can, of course, different respective components of the article; depend on many factors, such as description, it does not, on the other hand, resolve the character or purpose.' question of which of two classifications apply to an article which is composed of a single component. I am therefore of the view that Rule A 3 does not apply either. 32. While neither the parties nor the national court have taken a view on the application in the circumstances of the present case of what is essentially a fall-back common-sense crite­ 31. This leaves General Rule A 4, which pro­ rion, I have no doubt that the products with vides: which the cuts at issue are most akin are separated hindquarters under product code 0207 41 11 000. In practical terms, the only difference is a cut in the skin attaching the legs of the two portions of the hindquar­ 'Goods which cannot be classified in accor­ ters. That these two products may be consid­ dance with the above rules shall be classified ered 'most akin' is demonstrated by the fact under the heading appropriate to the goods that the customs authorities in both Germany to which they are most akin.' and the Netherlands originally took the view that the cuts at issue should be classified under product code 0207 41 11 000, and only changed their opinion in one case two, in the The Explanatory Notes to the Harmonised other more than four, years later. Should System regarding the interpretation of this General Rule A 4 apply, I am of the view that Rule provide that 'it is necessary to compare the cuts at issue should still be classified under the presented goods with similar goods to product code 0207 41 11 000.

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