C-394/97

1. By order of 5 November 1997 the Hel- Relevant provisions singin Käräjäoikeus (Helsinki District Court) (Finland) referred to the Court three questions on the interpretation of Council Regulation (EEC) No 918/83 of 28 March 1983 setting up a Community system of reliefs from customs duty (hereinafter 'the The provisions of Community law Regulation') 1 and Council Directive 69/169/EEC of 28 May 1969 on the har- monisation of provisions laid down by law, regulation or administrative action relating 2. Title XI of the Regulation regulates the to exemption from turnover tax and excise reliefs from customs duty which Member duty on imports in international travel States are to grant to goods contained in (hereinafter 'the Directive').2 the personal luggage of travellers coming from a third country. According to Arti- cle 45, these goods are to be admitted free of import duties, provided such imports are of a non-commercial nature. Paragraph 2 of this same article explains that 'imports of a non-commercial nature' mean imports which are of an occasional nature and which consist exclusively of goods for the personal use of the travellers or their families, or of goods intended as presents. In particular, the national court is asking 'The nature and quantity of such goods the Court whether the aforementioned should not be such as might indicate that instruments must be interpreted in such a they are being imported for commercial way that a total prohibition on imports of reasons'. alcoholic drinks, justified on grounds relat- ing to the public interest, with respect to short journeys made to third countries by residents of Finland, is considered to be compatible with them. For certain categories of goods, Article 46 limits the relief according to the quantity of * Original language: Italian. the goods. For all other goods, including 1 —OJ 1983 L 105, p. 1. Regulation as amended by Council those which are the subject of this case Regulation (EC) No 355/94 of 14 February 1994 (OJ 1994 L 46, p. 5). (beer), Article 47 imposes instead a limit on 2 — OJ, English Special Edition 1969 (I), p. 232. Directive as last their value which is set at ECU 175 by amended by Council Directive 78/1033/EEC of 19 Decem- ber 1978 (OJ 1978 L 366, p. 31) and Council Directive virtue of the amendments made by Regula- 94/4/EC of 14 February 1994 (OJ 1994 L 60, p. 14). tion No 355/94.

7. Mention should next be made of Annex XV, IX, 'Taxation', to the Act concerning the conditions of accession of Article 3 of the Directive contains the same the Kingdom of Norway, the Republic of definition for 'imports of a non-commercial Austria, the Republic of Finland and the nature' as that given in the text of the Kingdom of Sweden and the adjustments to Regulation. the Treaties on which the European Union is founded. 4This Annex gives the Republic of Finland and the Kingdom of Sweden the power to 'maintain quantitative limits for imports of cigarettes and other tobacco products, spirits, wines and beer from other Member States on the conditions stipu- 5. According to Article 4 of the Directive, each Member State is to set quantitative limits for exemptions from duty on imports 3 — OJ 1992 L 76, p. 1. of certain alcoholic drinks. These limits are 4 — OJ 1994 C 241, p. 21, p. 339.

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9. The traditionally restrictive Finnish leg- islation on imports of alcoholic drinks, 8. The Community legislation on commer- consisting of the Alkoholilaki 9 (Law on cial imports from third countries and, in Alcohol) and the Asetus alkoholijuomista particular, the texts of the regulations adopted pursuant to Article 113 of the EC Treaty contain similar provisions to the text 7 —OJ 1994 L 67, p. 89. of the ninth recital of the Regulation. 8 — The same wording also appears in Article 24 of Council Regulation (EC) No 3285/94 of 22 December 1994 on the common rules for imports and repealing Regulation (EC) No 518/94 (OJ 1994 L 349, p. 53). That regulation, which contains the general arrangements for imports of products 5 — Article 26 of Directive 92/12/EC gives this same power to from third countries, does not apply to imports from the Denmark, subject to a review mechanism. countries listed in Annex I to Regulation No 519/94. 6 —OJ 1997 L 8, p. 12. 9 — Law No 459/68, last amended by Law No 287/96.

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ja väkiviinasta 10 (Decree on alcoholic transport from outside the European Eco- drinks and spirits), has been subject to nomic Area, or (b) the journey lasted less various amendments in recent years. With than or equal to 20 hours. The new Decree regard to imports for personal use, the entered into force on 1 May 1996. legislation in force from 1992 to 1994 allowed the import, free of import duties, of a small quantity of alcoholic drinks only with respect to journeys lasting more than 24 hours. In 1995, following Finland's accession to the European Union, a special provision was adopted on imports from Member States and the limits on the duration of the journey with regard to imports from a non-member country were abolished.

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protectionist measures. Other arguments, In his defence, Mr Heinonen argued before of an economic nature, were also put the Helsingin Käräjäoikeus that the Finnish forward, including the reduction in sales provisions were incompatible with Com- of alcoholic products in East Finland and munity law, under which he was authorised the fall in tax receipts due to the increase in to import freely the quantity of beverages imports of products free of taxes or duties. contained in his personal luggage.

Facts and questions 14. By order of 5 November 1997 the Helsingin Käräjäoikeus referred the follow- ing questions to the Court:

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duty-free regulation and the travel Member States adopting measures such as directive ? those indicated in this case.

(3) May a rule limiting travellers' imports of alcoholic drinks, which in this It should first be observed in this respect question also includes beer, on the that the Regulation and the Directive are basis of the duration of the journey be intended to lay down common rules on, regarded as compatible with the provi- respectively, reliefs from customs duty and sions of the duty-free regulation and tax exemptions for goods imported into the the travel directive?' Community. Both of these acts confer on private individuals the right to import into the territory of Member States a specified quantity of goods which is not subject to customs duty or to turnover tax and excise duty, provided that the importation is of a non-commercial nature. These are clearly measures which are aimed, on one hand, at facilitating international travel 11 and, on The first question the other, at facilitating the work of the customs authorities of the Member States. In the preamble to the Regulation it is stated in general terms that a customs duty in accordance with the Common Customs 15. By its first question, the national court Tariff is not justified 'in certain well- is asking the Court, essentially, whether the defined circumstances, where by virtue of provisions of the Regulation and the Direc- the special conditions under which goods tive which relate to the import for personal are imported the usual need to protect the use of goods free of import duties are to be economy is absent'. 12 This is also applic- interpreted as allowing Member States to able, in the light of the provisions of Title adopt measures of a general nature which, XI of the Regulation, in the case of imports based on non-economic requirements, in of a non-commercial nature. certain circumstances restrict the import from third countries of alcoholic drinks for personal use.

regulated by the provisions contained in the Court confirmed the incompatibility with Directive and the Regulation which allow the Community legislation in question of travellers arriving from third countries to an Irish provision which distinguished, enjoy an exemption from payment of the with regard to the application of the relief, respective duties and taxes up to the between 'genuine' travellers and 'fiscal' quantitative limits and values indicated travellers, the latter being excluded from therein. With regard to reliefs from customs the application of the relief specified in the duty, the preamble to the Regulation states Directive. In that case — which, moreover, that the need for common rules, in accor­ unlike this case, concerned travel from one dance with the international conventions to Member State to another — the Court did which all the Member States are contract­ not agree with the view taken by the ing parties, 13is justified by the requirement defendant government which sought to for customs union. Specifically, the aim is justify measures restricting the application to 'eliminate differences in the aim, scope of the relief on the ground that the flow of and conditions for application of the reliefs travellers from Ireland to Northern Ireland, contained in these conventions, and to where the lower VAT rate made the pur­ enable all those concerned to enjoy the chase of certain goods more advantageous, same advantages throughout the Commu­ had caused serious damage to the Irish nity' (fourth recital). economy. After confirming that Member States have only the limited power expressly conferred on them to grant reliefs different from those specified in the Direc­ tive, the Court stated that 'where, on account of the economic15 situation in a Member State, it becomes necessary to adopt exceptional provisions making the grant of exemptions subject to a period of time spent outside national territory, such 18. It should be added that, as the Court provisions may be adopted only in pursu­ has frequently had occasion to point out, ance of a directive derogating from Direc­ the Community legislation on reliefs from tive 69/169'.16 customs duty and tax exemptions is exhaustive. The Member States may there­ fore only derogate from the common rules within the limited scope of the competence granted thereto by the Community provi­ 14 sions in question. However, this clarifi­ cation is to be taken as referring solely to cases where the Member State intends to derogate from the common rules on eco­ nomic grounds. Thus, for example, in the judgment in Commission ν Ireland, the

17 — A provision of the same kind is contained in the text of Article 58(2) of Council Regulation (EEC) No 2913/92 of 12 October 1992 (OJ 1992 L 302, p. 1) establishing the The second question Community Customs Code. These provisions are modelled on the text of Article XX — 'General Exceptions' — of the General Agreement on Tariffs and Trade 1994 which specifies that 'subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimina- tion between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any contracting party of measures: (a) necessary to protect public morals; (b) necessary to protect 22. By its second question, the national human, animal or plant life or health'. The aforementioned New York Convention on the facilitation of tourism traffic court is asking the Court whether the must also be noted, as this specifies in Article 9 (official grounds indicated in the Finnish legislation French text) that 'chacun des États contractants reconnaît que les prohibitions qu'il impose à l'importation ou à can be such as to justify the restrictive l'exportation des objets visés par la présente Convention ne doivent s'appliquer que dans la mesure où ces prohibitions measures adopted on imports of alcoholic sont basées sur des considérations qui n'ont pas un caractère économique, telles que des considérations de moralité publique, de sécurité publique, d'hygiène ou de santé publique, ou d'ordre vétérinaire ou phytopatholo- gique'. 19 — See Article XX of the General Agreement on Tariffs and Trade and Article 3 of the New York Convention, cited 18 — Aforementioned Article 58(2). above.

drinks by travellers arriving from third to justify the restrictive measures adopted countries. with respect to imports of alcohol for personal use, intended to protect public order, public morality and health, are in conformity with the aforementioned Com- munity provisions. In this respect, while accepting that the specific objectives of the Community customs and tax provisions are 23. It should be observed in this, respect not equivalent to those set out in the that, in the documents preparatory to the legislation on the movement of goods in Finnish law, non-economic requirements, the internal market, I believe that, for our such as the protection of public order, purposes, reference can usefully be made to public morality and health, were put for- the case-law of the Court on the interpre- ward in justification of these restrictive tation of Article 36 of the EC Treaty. 20

countries. Social and health requirements or interests protected by Article 36 of the and requirements involving the protection Treaty and it is for the Member States, of public morality were also cited, easy within the limits imposed by the Treaty, to access to alcoholic products having caused decide what degree of protection they a significant increase in consumption with intend to ensure'. 21 In its judgment in significant consequences for human health. Henn and Darby, the Court ruled that 'in Finally, an increase in the number of principle, it is for each Member State to suicides had been recorded.

16. See also Case 104/75 De Peijper [1976] ECR 613, paragraph 15. Article 129 of the EC Treaty (now, after amendment, Article 152 EC), on 'Public Health', specifies, in paragraph 1, that 'the Community shall contribute towards ensuring a high level of human health protection by encouraging cooperation between the Member States and, if necessary, lending support to their action' (first subparagraph) and that 'health protection requirements shall form a constituent part of the Community's other policies' (third subparagraph).

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with the principles of necessity and pro- restrictions on imports of alcoholic drinks portionality of the measures with regard to for personal use from third countries. the requirements to be protected. 23

The third question

28. By its third question, the national court is asking the Court whether the Regulation 26. With regard, more specifically, to and the Directive allow Member States to national measures as part of the campaign adopt legislation which, based on grounds against alcoholism, the Court has recently relating to the public interest, prohibits made it clear that the protection of human imports of alcoholic drinks for personal use health against the harmful effects of alco- from third countries following a journey hol 'is indisputably one of the grounds lasting no more than 20 hours. The point which may justify derogation from Arti- which specifically falls for consideration is cle 30 of the Treaty'. 24 There is therefore whether the measures introduced by Fin- no doubt that measures aimed at limiting land respond to criteria of necessity and the consumption of alcohol fall, in princi- proportionality with regard to the objec- ple, within the sphere of the requirements tives established. specified in Article 36 or the Community provisions on imports of products of a non- commercial nature from third countries.

32. That said, however, it should be pointed out that the Community provisions in question, even in the light of the 30. I believe that, in principle, it is the interpretation offered by the Court in the responsibility of the national court, in the context of Article 36 of the EC Treaty, light of the elements of fact or law available seem to allow the Member States a certain to it, to decide whether the measures specifically adopted by Finland are capable margin of discretion in assessing which of putting a halt to the trends described measures are capable of guaranteeing con- above or whether less restrictive measures crete results in the campaign against alco- could guarantee a similar result. The deter- holism. In determining the question of mination of the question whether the proportionality, due account must be taken measures adopted are proportionate and of the specific nature of the social contexts effective is made on the basis of assess- in which the measures are applied and the ments of a factual nature which clearly importance which the individual Member cannot be made by this Court, whose State attributes to objectives that are legit- function is, instead, to provide the national imate under Community law, such as the court with all such assistance as may enable reduction of the consumption of alcoholic it to make that assessment. drinks.

order to establish a more effective system of liberalisation of imports from third coun- border controls. tries. 25 This solution has a precedent in the aforementioned Directive 92/12/EEC, as amended by Directive 96/99/EC, under which the Republic of Finland retains the power to refuse relief to alcoholic drinks imported by travellers, resident in Finland and arriving from other Member States, who have spent a period of less than 24 34. Although this context is in principle favourable to national measures designed hours outside Finland. This provision to prevent the excessive consumption of therefore does not preclude the import of alcohol, doubts remain, however, with the products in question but allows them to regard to the solution actually adopted. be refused relief from customs duties. 26 The Finnish Government has not explained why, rather than totally prohibiting imports of alcoholic products purchased for personal use and imported into Finland following a journey lasting no more than 20 hours, it has not taken the simpler step of suspending the application of the system of reliefs to those goods, thus applying to them the customs and excise duties pre- scribed in the relevant Community or national provisions. In other words, alco- holic drinks purchased in third countries at prices significantly lower than those charged in Finland could have been exclu- ded from relief and be subject to tax and customs arrangements which would have made their purchase no more advantageous than purchases made in Finland. Moreover, a measure of this type, less drastic in nature, could act as an effective deterrent, without, in principle, excluding imports of alcoholic drinks from third countries fol- lowing a journey lasting no more than 20 hours.

(2) The duty-free regulation and the international travel directive must be interpreted as meaning that national measures which, in order to protect public health from the damage caused by alcohol and to prevent crime linked to the consumption of alcohol, restrict imports of alcoholic drinks for personal use from third countries are compatible with them.

(3) It is for the national court to determine whether the measures adopted by the Republic of Finland, in particular those which prohibit imports of alcoholic products from third countries for personal use according to the duration of the journey, are necessary and proportionate with regard to the objectives of protecting health, public morality and public order; in particular, it is for the national court to determine whether those objectives could not be attained by limiting admission to relief of the personal goods of travellers arriving from third countries.

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