C-109/98

CRT FRANCE INTERNATIONAL ν DIRECTEUR RÉGIONAL DES IMPÔTS DE BOURGOGNE

OPINION OF ADVOCATE GENERAL COSMAS delivered on 4 February 1999 Contents

I — Introduction I - 2239

II — Legal background I - 2240

A — Community legislation I - 2240

Β — National legislation I - 2241

VI — Conclusion I - 2265

I — Introduction Dijon (France), submitted to the Court a question on the interpretation of Articles 9, 12 and 95 of the Treaty. Specifically the Court is asked to rule whether a charge to tax, such as that imposed under Article 302 bis (X) of 1. In this reference for a preliminary ruling the French General Tax Code, on supplies in under Article 177 of the E C Treaty, the Tri­ France of transmitting-receiving sets, known bunal administratif (Administrative Court), as CB sets, constitutes a charge having equiva­ lent effect to a customs duty, or is to be regarded as internal taxation within the * Original language: Greek. meaning of Article 95 of the Treaty.

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II — Legal background equivalent effect, and from increasing those which they already apply in their trade with each other.'

A — Community legislation 4. Moreover, under Article 95 of the Treaty:

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6. Finally, under Article 30 of the Treaty: CB sets with a maximum of 40 channels, operating exclusively by angular modulation with a peak modulation power of not more than 4 watts, shall not be subject to that tax.

1991). On the basis of that amendment Article 45(111) of abovementioncd law no 86-1317 thenceforth provided that the first acquisition of a CB set was to give rise to a charge to tax of FRF 250. However, CB sets with a maximum of 40 channels, operating exclusively by angular modulation with a peak modulation power of not more than 4 watts, were not to be subject to that tax. Β — National legislation As a result of that amendment the charge to tax was raised, continued to be imposed on users but there was no longer a requirement for renewal every five years.

The fundamental objective of that amendment, which did not alter the amount of the tax, was to simplify the method of pay- ment of the tax by bringing the system into line with the VAT system. Finally, the regime was amended by Article 27(1) and (II) of law no 93-1353 of 30 December 1993. That amendment con- cerned two points: first, the amount of the tax was fixed at 30% of the sales price less VAT of the CB sets, but cannot be 'I. Supplies in France of transmitting-receiving less than FRF 150 or more than FRF 350 per set. Secondly,

Objections shall December 1986. Use of CB sets was subject to the issue of a be submitted, examined and adjudicated upon under the rules applicable to that tax.'

'Do Articles 9, 12 and 95 of the Treaty of 25 9. Following accounting checks on CRT the March 1957 establishing the European Eco- competent tax authority sent amended notices nomic Community preclude the national to it on 25 October 1993 which dealt, inter authorities from imposing on manufacturers, alia, with the charge to tax on the supply of importers and suppliers in France of CB sets, as provided for under abovemen- transmitting-receiving sets operating on tioned Article 302 bis (X) of the General Tax two-way channels a charge to tax under the Code. Following dismissal of the doubts rules laid down in Article 302 bis (X) of the expressed by CRT and after fruitless attempts General Tax Code?'

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V — The reply to the preliminary question A —Admissibility of the preliminary question

Indeed, in the present case the Tribunal admin- istratif, Dijon, has not provided a detailed 3 — In view of the terms in which the preliminary question is couched I would like at this juncture to point out mat, under account of the factual and legislative context the terms of Article 177 of the Treaty, the Court does not rule of the question it is asking. In particular, the on the interpretation or validity of national provisions or on whether those provisions are compatible with provisions of order for reference does not explain the fea- Community law but provides the national court with all the interpretative elements necessary for it to adjudge itself tures of and background to the charge to tax whether a provision of domestic law is or is not compatible at issue, nor is any attempt made to deter- with rules of Community law. Whilst stressing that its inter- pretation is of Community law and not national law, it indeed mine whether that charge is contrary to or frequently reformulates the preliminary question along those lines. Such reformulation is revealed by use of expressions compatible with Community law. Further- such as: 'the above question is to be construed as seeking ...' more, the national court does not clarify either or 'accordingly, the national court must in its preliminary question be deemed essentially to be asking whether ...'. See, the origin of the CB sets or whether there is by way of example, judgments in Case 27/74 Demag [1974] ECR 437 and Case 152/79 Kevin Lee ν Minister of Agricul­ any domestic production of such sets, which, ture [1980] ECR 1495, Case 22/80 Boussac ν Gerstenmaier as I shall demonstrate below, are matters of [1980] ECR 3427, Case C-69/88 Krantz [1990] ECR 1-583, paragraph 7 and in Case C-204/90 Bachmann [1992] ECR I-249, paragraph 6. In light of the foregoing the Tribunal administratif, Dijon, must in its preliminary question be deemed to be asking in essence whether Articles 9, 12 and 95 of the Treaty are to be 4 — See, by way of example, judgments in Case C-83/91 Meilicke construed as precluding a provision of national law such as [1992] ECR I-4871, paragraph 26, Joined Cases C-320-322/90 the charge to tax imposed by France on manufacturers, Telemarsicabruzzo and Others [1993] ECR 1-393, paragraphs importers and sellers in France of transmitting-receiving sets 6 and 7, and also Orders in Case C-157/92 Banchero [1993] known as CB sets under Article 302 bis (X) of the General ECR I-1085, paragraph 4, and in Case C-386/92 Monin Auto­ Tax Code. mobiles [1993] ECR I-2049, paragraph 6.

5 — See, inter alia, judgments in Case C-316/93 Vaneetveld [1994] Yet, however fine that distinction may be, it ECR I-763, paragraph 14 and in Case C-125/94 Aprile [1995] ECR I-2919, paragraphs 18 to 21. is none the less the case that, as the Court has

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consistently held, 6 the provisions on charges imposed is not in competition with any having equivalent effect to customs duties and domestic product. 7 the provisions on discriminatory internal taxa- tion cannot be applied cumulatively since, under the system of the Treaty, the same tax cannot belong at the same time to both categories. (b) The essential feature of a charge having equivalent effect to a customs duty which distinguishes it from an internal tax there- fore resides in the fact that the former is borne solely by an imported product as such whilst the latter is borne both by imported and domestic products. 8

18. In seeking the criteria for the requisite distinction, in accordance with the foregoing, between a charge having equivalent effect to (c) Such a charge will not be so characterised a duty and internal taxation within the meaning if it forms part of a general system of of Article 95, the Court has consistently held internal dues applying systematically to as follows: categories of products according to objec- tive criteria applied without regard to the origin of the products, in which case it falls within the scope of Article 95 of the Treaty. 9

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In that connection it should be pointed out take into account the purpose for which that the above criterion of whether the charge the revenue from the charge is applied. forms part of a general system of internal Thus, if the revenue from such a charge dues is applicable also where there is no is intended to finance activities for the domestic production of the product charged special advantage of the taxed domestic to tax and where in practice the charge appears products, it may follow that the charge at first sight to be imposed only on imported imposed on the basis of the same criteria products. As was stated, for example, in Com­ nevertheless constitutes discriminatory mission ν France 'the Court has however rec­ taxation in so far as the fiscal burden on ognised that even a charge which is borne by domestic products is neutralised by the a product imported from another Member advantages which the charge is used to State, when there is no identical or similar finance whilst the charge on the imported domestic product, does not constitute a charge products constitutes a net burden. Con­ having an effect equivalent to a customs duty sequently, as has been consistently held, on imports within the meaning of Articles 9 if the advantages stemming from the use and 12 of the E E C Treaty if it is part of a of the revenue from a charge forming part general system of internal dues applied sys­ of a general system of internal charges tematically to categories of products in applying systematically to domestic and accordance with objective criteria irrespective imported products fully offset the burden of the origin of the products'. 10 borne by the domestic product when it is placed on the market, that charge consti­ tutes a charge having an effect equivalent to a customs duty, contrary to Articles 9 and 12 of the Treaty. O n the other hand, if the advantages accruing to the taxed domestic products from the use of the revenue from the charge only partly offset (d) Finally, for the purposes of the legal char­ the burden borne by those products, such acterisation of a charge levied on domestic a charge would constitute a breach of the and imported products in accordance with identical criteria, it may be necessary to

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prohibition of discrimination laid down by 21. Consequently, the issue whether, in the Article 95 of the Treaty. 11 absence of domestic production, a charge such as that in the main proceedings only affects imported products or forms part of a general system of internal dues 14 constitutes the nub of the problem of the classification of the charge in regard to Articles 9, 12 and 95 of the Treaty. That is also reflected in the pow- erful arguments put forward on that point and on which the observations of not only 19. As regards the main proceedings it is the French Government and the Commission common ground that there is no French pro- but also of CRT essentially focus. duction of CB sets.

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(b) whether those charges are imposed on 23. At this juncture it should be stressed that categories of products in accordance with the above criteria are always examined in objective criteria, and whether a product connection with determination of the exist­ 17 belongs to such a category. ence of a system of internal dues. That notion of a system, whose importance was high­ lighted by Advocate General Mancini in his 20 Opinion in Commission ν Denmark, sets the parameters within which those criteria are to be examined.

(d) whether the proceeds of the charge are specifically earmarked or constitute tax revenue like any other contributing to the financing of general State expenditure in 25. This view of the matter concerning the all sectors. existence of a system explains why the Court in Commission ν France held that there is such a system even if it does not involve charges imposed on the same products but a 17 — See also in that connection judgment in Lourenço Dias (paragraphs 53 and 54) cited in footnote 10. 18 — See also in that connection judgment in Kortmann (para- graph 17) cited in footnote 8. See also judgment in Outo- kumpu cited in footnote 6 in which it was held that 'both imported electricity and electricity of domestic origin form 20 — See Opinion of Advocate General Mancini in Commission ν part of the same tax system and the duty is levied by the Denmark (paragraphs 3 and 4) cited in footnote 7. same authorities, whatever the origin of the electricity, under 21 — See judgment in S t einike (paragraph 30) cited in footnote 8 procedures governed by the general legislation on excise above. duties' (paragraph 22). 22 — See judgment in Commission v Denmark, cited in footnote 19 — See, inter alia, judgment in Case 132/78 Denkavit Loire ν 7, which concerned a charge imposed in Denmark for car­ France [1979] ECR 1923, paragraph 8. See also judgment in rying out hygiene controls on imports of groundnuts and Outokumpu (paragraph 24) cited in footnote 6. groundnut products (paragraph 24).

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functions. In that connection, it is not without refers to the criteria laid down in the Co-frutta significance that in Commission ν France, not­ judgment 2 9 and seeks to justify the charge as withstanding the fact that the charge at issue internal taxation within the meaning of Article was borne by a range of apparatus of very 95 of the Treaty. In its view the charge at different kinds but which had in common the issue does not specifically concern imported fact that they were all intended to be used for CB sets but forms part of a general system of reprographic purposes in addition to more internal dues. That is to be inferred, the French specific uses, 2 6 the Court, in determining Government says, from the following whether the charge at issue formed part of a matters: general system of internal dues, attached par­ ticular significance to the background to the imposition of the charge and to its objective, and found that it formed part of taxation arrangements which owed their origin to the breach made in copyright laws by the increased use of reprography and sought, albeit indi­ — First, the charge at issue forms part of rectly, to impose on users of those processes tax arrangements intended to cover the a charge in substitution of the charge to which expenditure necessarily incurred by the they would otherwise have been subject. 2 7 State in maintaining the spectrum of Hertzian waves within which various kinds of apparatus function, including CB sets.

— Secondly, the charging provision at issue combined 'radio and CB sets'), price or forms part of a group of similar imposts origin of the product. on a category of products of the same or similar nature. In that connection, the French Government refers generally to corresponding national provisions and states that the radio and telecommunica- tions installations, and the GSM networks, or private taxi or ambulance networks, operate on a licence and are subject to contributions for availability and opera- tion in order to offset the burdens entailed by use of the Hertzian network. It also states that persons tuned into radio-electric — Fourthly, the charge is not specifically frequencies pay an annual contribution for earmarked for any particular budgetary the availability and use of the frequencies. allocation; the proceeds from it constitute The French Government maintains, then, public revenue which, like any other, con- that the charge at issue forms part of a tributes generally to the financing of State series of contributions, whilst at the same expenditure in all sectors. time pointing out that, for purposes of simplification and in accordance with the recommendations of the European Con- ference on Posts and Telecommunications, the previous licence for use of CB sets was abolished with effect from 1 January 1992 and, as from 1 January 1993, the charge was transferred from the users to the manufacturers, importers and persons engaged in intra-Community marketing of CB sets. 28. Of the above points only the first and second are in essence called in question. Thus, CRT submits that the charge at issue does not meet the same criteria and is not governed by the same rules as the contributions to which the users of radio-electric networks are sub- ject. Specifically, CRT states that CB sets are the only telecommunications equipment to be specially charged to tax. The importation, sale or manufacture of mobile telephones, radio- telephones used within private networks by —• Thirdly, the charge is levied on the basis taxi companies or ambulances, cordless tele- of objective criteria, regardless of the origin phones, or even walkie-talkies is not subject of the product. In actual fact, the charge to any particular charge to tax. Only persons is imposed on all sets complying with the operating telecommunications networks pay French rules, whilst neither the rate, the special contributions. CRT refers generally to basis of assessment or the method of col- national legislation as regards the amount of lection of the charge is dependent on the such contributions and states that those are characteristics (even where they are either contributions on the establishment of a

dossier payable by persons seeking or holding radio-electric telecommunications networks authorisations in regard to the networks and results in that charge falling outside the gen- telecommunications services or an annual con- eral system of internal dues for the use of the tribution proportionate to the frequency radio-electric spectrum of frequencies. 30 which persons operating radio-electric net- works are authorised to use for the availability and use of the frequencies conferred on them. Conversely, as CRT states, neither the use of walkie-talkie sets, mobile telephones or of their frequencies is subject to any charge to tax, in the same way as their users do not occupy any specific frequency but like users of CB sets and other medical, industrial and academic applications operating on the same frequencies, are exercising the general right to use things in the public domain belonging to everyone. Accordingly, CRT maintains, the charge to tax on CB sets is not akin to any 30. As the Commission has stated, France, other charge. Nor, moreover, is it in the final like any Member State, may impose on users analysis associated with use of the Hertzian of the telecommunications networks a con- network because, first, it is not imposed on tribution to offset network-operating charges. the user but on the importer, secondly, being Contrary to what appears to be CRT's asser- based on the number of sets and not calcu- tions, that right may in my view subsist even lated on the basis of frequencies made avail- where use of the network is riot subject to able, it is not imposed according to the same prior authorisation because the charge is jus- criteria applicable to the tax treatment of tified by the general need for maintenance other apparatus and, thirdly, CB sets not and to deal with any disruptions to the net- intended for use in France, though supplied work; that need continues to exist even where in France, are not exempt from the charge. the user is availing himself of his right of free use of things in the public domain. Conse- quently, on the basis of the historical back- ground and the purpose of the charge at issue, 31 the latter would indeed appear to form part of a general system of internal dues for the use of the telecommunications net- works whose application is uncontestedly governed by criteria which are objective,

that is to say unaffected by the origin of the to tax and not the use thereof. Likewise it is sets. difficult to uphold the arguments put forward at the hearing by the French Government in order to justify the alteration in the method by which the charge to tax on CB sets is imposed. First, it was argued that the alter- ation is based on the educative idea that per- sons selling the sets would draw attention to the new charge by informing their customers 31. None the less, if we turn to examine the that no one can use the apparatus cost-free method by which the charge to tax on CB and that their use impacts on all users of the sets is imposed, we find that not only does it frequency range; the second argument was differ from the method of imposing a charge that, in practice, as a consequence of the to tax for the use of other apparatus, inas- increase in the sales price of the apparatus in much as it is the supply of CB sets which is question, the charge is passed on to the end charged to tax, as CRT has stated without purchaser/user. O n the one hand, as CRT being contradicted, whilst in the case of other observed, from a sales point of view it is one apparatus it is the use which is charged to tax, thing for a customer to buy apparatus and, but such differentiation is also difficult to jus- subsequently to pay a charge for its use, and tify in light of its objective, on the one hand, quite another matter to buy the apparatus at and in view of the specific manner in which a price directly increased by the amount of CB sets are used, on the other. Indeed, I am the charge. O n the other hand, in the present unswayed by the French Government's argu- case it is undisputed that the charge is pay- ment that abolition of the previous require- able even where the apparatus is supplied in ment for authorisation to use CB sets justi- France on a wholesale basis, is re-exported fies altering the chargeable event and imposing and used by the end purchaser outside France. the charge on manufacturers or importers of In such a case there is no longer any causal the sets rather than their users. 32 First, the link between the charge to tax and use of the alteration in the method by which the charge apparatus in France, which also negates the is imposed and the chargeable event does not French Government's argument concerning

32. In light of the foregoing I consider that its assimilation to the procedure for collec- the gap between the objective and the method tion of VAT, that it is the commercial supply of collection of a charge such as the gap char- of the apparatus which should be chargeable acterising the charge at issue, results in that charge no longer forming part of a general system of internal dues. Does that not lead to 32 — On the burden of proof of whether a charge comes within a the charge at issue being classified in law as a general system of internal dues and, incidentally, with whether charge having effect equivalent to a customs a charge is contrary to the Treaty, see below at paragraph 47 of my Opinion. duty?

In fact, as CRT has observed, since the charge at issue solely affects supply of CB sets and not necessarily their use, it may affect the free movement within the Community of the product in question. In actual fact, it is not disputed that the charge at issue is also imposed 35. Finally, a charge has been held not to on CB sets imported into France and sup- have equivalent effect to a customs duty where plied not with the purpose that the person it is levied on account of inspections carried taking delivery of them from the exporter out for the purpose of fulfilling obligations should use them in France but that they imposed by Community law. 35 However, the should, for example, be re-exported. conclusion to be drawn from the file and par- ticularly from the written observations of the French Government is that the charge at issue in the main proceedings plainly constitutes an amendment to an existing charge which was intended to offset the burden of maintaining the telecommunications networks; accord- ingly, it is not imposed on account of inspec- tions carried out for the purpose of fulfilling Moreover, in the absence of domestic pro- obligations imposed by Community law and, duction, the proceeds of the charge at issue therefore, is not on all fours with the afore- would appear, as the Commission has also mentioned Court judgment. observed, to be collected solely on imports of the CB sets. 34 — See, inter alia, judgment in Case 158/82 Commission ν Den­ mark (paragraph 19) cited above in footnote 7. 35 — See, inter alia, judgment in Case C-130/93 Lamaire [1994] 33 — See above paragraph 14 of my Opinion. ECR I-3215, paragraph 14.

It should also be emphasised that the above (b) Compatibility of the charge with Articles prohibition applies both to products from the 9, 12 and 95 of the Treaty other Member States or from non-Member States but which are in free circulation within the Member States, as expressly mentioned in Article 9(2) of the Treaty and as a matter of

38. If a charge to tax such as that in the main 37 — Given that the cases mentioned above at paragraphs 34 and 35 do not under the case-law constitute exceptions from the proceedings constitutes a charge having equiv- prohibition on charges having equivalent effect to a customs duty but cases in which such charges do not exist, the pro- hibition in Articles 9 and 12 of the Treaty could, then, be classified as an absolute prohibition on charges having equiva- lent effect to a customs duty. 36 — See footnote 10 above. 38 — See above paragraph 18.

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principle to products coming directly from from it provided that the intrinsic effect of non-Member States. such charges on the relevant trade with third countries must be uniform in all the Member States. 40

40. As is apparent from the file, the CB sets Likewise, the Court has held that the prohi- supplied in France are not manufactured in bition as regards trade with non-Member France, 42 but are either imported directly States is not absolute and that when they from the Far East where they are made or, as impose that prohibition the Community insti- tutions may make exceptions or derogations 40 — See judgment in Case 70/77 Simmenthal [1978] ECR 455, paragraphs 26 and 27. 41 — See judgment in Aprile (paragraph 42) cited above in foot- 39 — See, inter alia, judgment in Case C-126/94 Cadi Surgelés and note 5. Others [1996] ECR I-5647, paragraphs 13 to 19. 42 — See also paragraph 19 above.

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However, that classification does not alter the fact that the charge at issue is contrary to the Treaty if — the sets in question being deemed to have been imported directly from non- Member States — there are no special con- Furthermore, notwithstanding the fact that it tractual or unilateral Community provisions is undisputed that the majority of CB sets are in connection with trade in CB sets or trade imported into France from the Far East and that CRT states that Malaysia and Thailand in particular are the countries of origin of the 43 — In its written observations the French Government accepted sets, there are no precise details in the file of that the majority of the CB sets are imported into France all the countries from which those products from the Far East, whilst however not excluding that there may be intracommunity marketing of apparatus originating are imported. Therefore, it will be for the in other Member States (see written observations of the national court to clarify the exact origin of French Government, paragraphs 16 and 17). 44 — None the less, notwithstanding the fact that it is not clear the imported CB sets in order that it may be from the file that there is no Community production of CB determined whether for each one of the coun- sets it should be pointed out that if the CB sets imported into France were found to be of Community origin, there tries of origin of the sets there are any rel- could be doubt as to the application of the prohibitions con- tained in Articles 9 and 12 of the Treaty. evant special Community provisions.

42. In light of the foregoing I consider that Articles 9, 12 and 113(1) 48 of the Treaty are to be interpreted as precluding a charge having equivalent effect to a customs duty, such as the national measure at issue in the main pro- As regards the above points, it should be ceedings, subject to the reservation that there recalled that, apart from the fact that it is for are no contractual or unilateral special Com- the national court, which is best acquainted munity provisions intended to secure uniform- with the nature of the French market and the legal regime applicable to approved CB sets, to review their correctness, the, as it were, 45 — See above paragraph 18. absolute prohibition on charges having equiv- 46 — See above paragraph 16. alent effect to a customs duty under Articles 47 — See above paragraph 39. 9, 12 and 113(1) of the Treaty is not depen- 48 — On the ability of the Court to interpret provisions of Com- munity law not referred to in the order for reference by the dent on the amount in each case of the charge national court see below at footnote 74.

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It has also been consistently held 53that, in its present state of development, Community law does not restrict the freedom of each Member State to establish a tax system which differentiates between certain products, even 44. First, it is settled case-law that Article 95 products which are similar within the meaning of the Treaty seeks to secure the free move­ of the first paragraph of Article 95 of the ment of goods between the Member States Treaty, on the basis of objective criteria, such under normal competitive conditions by elimi­ as the nature of the raw materials used or the nating all forms of protection resulting from production processes employed. Such differ­ the application of internal taxation which dis­ entiation is compatible with Community law, criminates against products from other however, only if it pursues objectives which Member States. 4 9 Accordingly, a system of are themselves compatible with the require­ taxation can be considered compatible with ments of the Treaty and its secondary legisla­ Article 95 of the Treaty only if it is so arranged tion, and if the detailed rules are such as to as to exclude any possibility of imported avoid any form of discrimination, direct or products being taxed more heavily than domestic products. 5 0 51 — Case 55/79 Commisňon v Ireland [1980] ECR 481, paragraph 8. 52 — See judgment in Grundig (paragraph 13) cited above in foot­ 49 — See, for example, judgment in Grundig (paragraph 11) cited note 9. above in footnote. 9. 53 — See, inter alia, judgments in Case 196/85 Commission v 50 — See, inter alia, judgments in Case C-152/89 Commission ν France [1987] ECR 1597, paragraph 6, and in Haahr Petro­ Luxembourg [1991] ECR I-3141, paragraph 21, and Grundig leum (paragraph 29) and Outokumpu (paragraph 30), both (paragraph 12) cited above in footnote 9. cited above in footnote 6.

Moreover, the Court has already ruled that a criterion for the charging of higher taxation, which by definition can never be fulfilled by domestic products similar to or in competi- tion with products imported from other Member States as described above, cannot be 45. Secondly, it has been consistently held considered to be compatible with the prohi- that, contrary to the prohibitions under Arti- bition of discrimination laid down in that cles 9 and 12 of the Treaty, 'Article 95 applies provision. Such a system has the effect of only to goods imported from other Member excluding domestic products in advance from States and, where appropriate, to goods origi- the heaviest taxation. 54 Likewise, the Court nating in non-member countries which are in has held that such differential taxation is free circulation in the Member States. It fol- incompatible with Community law if the lows that that provision is not applicable to products most heavily taxed are, by their very products imported directly from non-member nature, imported products. 55 countries.' 57 It has also been held that 'so far as concerns the possibility of applying Article 113 of the Treaty, it is important to note that the Treaty does not contain any provision similar to Article 95 regarding domestic taxa- tion in respect of trade with non-member countries, subject, however, to any Treaty provisions which may be in force between the Community and the country of origin of Finally, the Court has held that internal taxa- a given product ... and that although Article tion infringes Article 95 of the Treaty when 113 confers upon the Community powers it indirectly imposes a heavier burden on which enable it to take any appropriate meas- products from other Member States than on ure concerning the common commercial domestic products, if it is used exclusively or policy, it nevertheless does not in itself con- principally to finance aids for the sole benefit tain any legal criterion which is sufficiently of domestic products. 56 In the present case, precise to enable an assessment of the con- tested national rules to be made'. 58

It follows from the foregoing that the prohi­ As regards interpretation of the similarity of bitions under Article 95 of the Treaty apply products on which the prohibition in the first in the present case to CB sets imported into paragraph of Article 95 is based, it has been France from other Member States and to sets consistently held that in order to determine manufactured in non-Member States which whether products are similar, the test is not are in free circulation in the Member States. whether they are strictly identical but whether However, it is for the national court to deter­ their use is similar and comparable. In fact, mine precisely whether there are sets in free even though there are no domestic products circulation in the Community and from which subject to the charge which are entirely iden­ non-Member States they are imported directly tical to imported taxable products, it must into France so that a finding may be made as always be examined whether there are other to whether there are agreements between the domestic products which have similar char­ Community and those countries negating the acteristics and meet the same needs from the principle that the prohibition under Article point of view of consumers. 6 2 95 of the Treaty does not apply to products imported directly from non-Member States. 5 9 It is worth pointing out that it is for the national court, after seeking, if necessary, a preliminary ruling from the Court on the interpretation of the provisions of the inter­ national agreements, to determine whether those provisions are of a nature effectively to As regards interpretation of competing prod­ prohibit a Member State from levying internal ucts under the second paragraph of Article taxation on products imported directly from 95, it has been held that imported products, non-member States. 6 0 even though not similar, within the meaning of the first paragraph of Article 95, to domestic products, may nevertheless be in a competi­ tive relationship with some of them, even if only partially, indirectly or potentially. 6 3 The Court has also consistently held that the assessment of the compatibility of a fiscal charge with the second paragraph of Article 95 must take account of the impact of that charge on the competitive relationships between the products concerned. The essen­ tial question is therefore whether or not the charge is of such a kind as to have the effect, 46. Thirdly, as has already been stated, the on the market in question, of reducing poten­ Court has held that 'Article 95 cannot be tial consumption of the imported products to invoked against internal taxation imposed on the advantage of competing domestic imported products where there is no similar or competing domestic production'. 6 1

products (see the judgment in Case 356/85, munications networks. 66 In that connection, paragraph 15). In that connection, the national contrary to the French Government's asser- court must have regard to the difference tions, 67 it is not a correct view of the matter between the selling prices of the products in to say that whether there is discrimination question and the impact of that difference on between imported and similar products or the consumer's choice, as well as to changes whether the charge is protectionist falls to be in the consumption of those products. 64 determined solely in regard to the charge at

Cer- within the terms of Article 95, recourse must similarly be had to that criterion in order to assess whether there are any similar domestic 66 — On this point I should stress that my view of this matter products and, if so, whether they are discrimi- does not conflict with the earlier finding that the fact that a charge forms part of a general system of internal taxation nated against within the meaning of the first giving rise to the application of Article 95 of the Treaty does paragraph of Article 95.

Under the charge to tax on CB sets the only discrimination is that con- cerning exemption from the charge for sets complying with European Standard ETS 300/135. However, as the French Government correctly observed without being contradicted, 64 — Judgment in Roders and Others (paragraph 39) cited above that discrimination is based on an objective criterion (high- in footnote 62. powered sets which, in accordance with the European Stand- 65 — Judgment in Case 169/78 Commission v France [1980] ECR ard, do not overall cause severe disruption) unconnected 385, paragraph 7. with the origin of the sets in question.

68 — The file shows that the parties in the main proceedings men­ tion radio-telephone and telecommunications networks, such as the GSM networks, or private networks operated by taxi 48. Fifthly, in the event that there is found to companies or ambulance services, mobile telephones, cord­ less telephones, and walkie-talkies, but also apparatus for use be no similar or competing domestic produc­ in connection with academic, industrial and medical applica­ tion, it is not permissible to impose on prod­ tions, without its being clear that it is only such apparatus which can be regarded as 'competing' (see above paragraphs ucts which, in the absence of comparable 27 and 28). domestic production, escape the application 69 — At the hearing CRT in summary stated, and their statement was not challenged, that Citizen Band sets are high-powered of the prohibitions contained in Article 95 transmitting-receiving sets operating on 40 channels, as deter­ mined under the applicable rules, which chiefly permit com­ charges of such an amount that the free move­ munication between correspondents within a narrow cir­ ment of goods within the common market cumference. Such apparatus, CRT explained further, is used chiefly by lorry drivers who wish to communicate amongst would be impeded as far as those imported themselves in random manner, and thus are not seeking to be connected to a specific correspondent, as happens with the telephone, but are seeking out at random any inter­ locutor who happens to be nearby. In CRT's view, such apparatus does not enjoy a good reputation with the French administrative authorities because it is suspected of being 70 — See above paragraph 44. used either by the abovementioned drivers in order to cir­ 71 — See, inter alia, judgment in Case C-327/90 Commission ν cumvent official checks or radar controls or by protesters. Greece [1992] ECR I-3033, paragraph 20.

49. At the outset it should be pointed out that Article 30 of the Treaty, which prohibits all measures having equivalent effect to quan- titative restrictions on imports, applies, on

50. I should also point out that it has been 72 — See Stier judgment and Commission ν Denmark (paragraphs consistently held, starting with the Court's 12 and 13) both cited in footnote 10. judgment of 11 July 1974 Dassonville, 78 that 73 — Judgment in Commission ν Denmark (paragraph 13) cited any measure capable of hindering, directly or above in footnote 10. 74 — The Court has held that, as part of its mission, which is to indirectly, actually or potentially, intra- assist in the administration of justice in the Member States, Community trade is to be deemed to be a and in order to provide the national court with a useful answer, it is its duty to interpret all provisions of Commu­ measure having equivalent effect to a quanti- nity law which national courts need in order to decide the actions pending before them. For that reason it may indeed tative restriction within the meaning of Article need to give consideration to provisions not expressly indi­ 30 of the Treaty. cated in the questions referred to the Court of Justice by those courts. See, for example, judgments in Case C-280/91 Viessmann [1993] ECR I-971, paragraph 17, Case C-114/91 Claeys [1992] ECR I-6559, paragraphs 10 and 11 and Case 35/85 Tissier [1986] ECR 1207, paragraph 9. It is also worth noting that there is nothing in the pleadings 75 — See judgments in Case 212/88 Levy [1989] ECR 3511, para­ to support the inference that the national court intended to graph 17 and Case C-131/93 Commission v Germany [1994] request a preliminary ruling only on the interpretation of ECR 1-3303, paragraph 10. Articles 9, 12 and 95 of the Treaty. See to the opposite effect judgment in Case 247/86 Alsatel [1988] ECR 5987 in which 76 — Judgment in Joined Cases 51/71 and 54/71 International the national court was ruled to have tacitly refused to put a Fruit Company [1971] ECR 1107, paragraph 10. question to the Court on the interpretation of a provision 77 — See above paragraph 40. on which the order for reference was silent (paragraph 8). 78 — Case 8/74 Dassonville [1974] ECR 411.

In light of that case-law a judgment will have national system of taxation of which the tax to be made, then, as to whether the charge at in question is an integral p a r t ' . issue on imported CB sets is of such an amount as to restrict the possibility of imports of those products and in general terms the free movement thereof in the sphere of intra- 79 Community trade. Thus, in the present case, the amount of the charge on CB sets will have to be deemed to be of such an amount as to cause the adverse effects on intra-Community trade mentioned above, if the rate of the tax charge goes beyond the general framework of the national system of taxation of which the charge at issue According to CRT's observations, 8 0 the is presumed to form part such as to give it the amount of that charge was of such an amount character of an internal due. 8 2 as to have doubled the price of CB sets, sig nificantly reduced sales and severely affected both domestic — French — and Community trade, with the result that the conclusion to be drawn is that the charge at issue is capable of restricting imports. In that connection, since, apart from certain general references to the relevant national provisions, the pleadings in the case do not contain all the essential elements, it is for the national court, which knows best and in greatest detail the national provisions con cerning the various charges imposed on the The correctness of the matters relied on by use of the telecommunications network or on CRT and the resulting effect which they are the apparatus operating within them, to clarify likely to have on intra-Community trade must the general context as regards rates charged in my view be adjudged after the criterion as within the system of internal taxation of which to the charge of such an amount has been the charge at issue forms part and whether applied.

That crimination between domestic and Community products; difficulty is not without significance as regards the prelimi those issues which presuppose that there is domestic pro nary issue as to whether in the final analysis the charge at duction fall to be determined, if there is such production, in issue forms part of a general system of internal taxation. the light of the provisions of Article 95 of the Treaty. Conversely it makes apparent the difficulty in accepting such 80 — See above paragraph 41. a view (see above paragraphs 29 and 32).

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