C-309/98

HOLZ GEENEN

OPINION OF ADVOCATE GENERAL JACOBS delivered on 8 July 1999 *

1. This case concerns the validity of Com- each code, the seventh and eighth digits mission Regulation No 1509/97 1in so far forming subdivisions specific to the CN. as it classifies 'rectangular wood blocks, 48 or 85 mm wide x 72 mm high, used in the construction of window frames, consisting of layers of wood glued together with the grain running parallel and with slightly 3. Chapter 44 of the HS and the CN covers rounded edges', under subheading 'Wood and articles of wood; wood char- 4418 90 10 of the combined nomenclature coal'. The basic (six-digit) structure of ('CN') contained in Annex I to Council heading 4418 ('Builders' joinery and car- Regulation No 2658/87, 2as amended and pentry of wood, including cellular wood updated from time to time. panels, assembled parquet panels, shingles and shakes') is as follows:

4418 10 Windows, frenchwindows and their frames The customs classification legislation, facts 4418 20 Doors and their frames and and procedure thresholds 4418 30 Parquet panels 4418 40 Shuttering for concrete construc- tional work 2. The CN is the Community customs tariff 4418 50 Shingles and shakes nomenclature based on the world-wide Harmonised System ('HS'), 3to which it is 4418 90 Other. identical as regards the first six digits in

* Original language: English. 1 — Commission Regulation (EC) No 1509/97 of 30 July 1997 concerning the classification of certain goods in the 4. With effect from 1 January 1996, sub- combined nomenclature, OJ 1997 L 204, p. 8 ('the Regula- tion'). heading 4418 90 of the CN was further 2 — Council Regulation (EEC) No 2658/87 of 23 July 1987 on subdivided by Regulation No 3009/95 4 the tariff and statistical nomenclature and on the Common Customs Tariff, OJ 1987 L 256, p. 1. 3 — The Harmonised Commodity Description and Coding System, introduced by the International Convention of 4 — Commission Regulation (EC) No 3009/95 of 22 December 14 June 1983, approved for the Community by Council 1995 amending Annex I to Council Regulation (EEC) Decision 87/369/EEC of 7 April 1987, OJ 1987 L 198, p. 1. No 2658/87, OJ 1995 L 319, p. 1, at p. 376.

into 4418 90 10 'Glue-laminated timber' classification, the Commission's explana- and 4418 90 90 'Other'. That subdivision tory notes to the CN 6 ('CNENs') stated was effected, for purely statistical pur- that 'wood blocks made up of slats glued poses, 5 at the request of a number of together and then planed on the four sides' timber trade federations within the Com- were included under the residual subhead- munity. ing 4421 90 99. The Commission confirms that those articles were the same as those referred to in different terms in Regulation No 1509/97. (In the following edition of the CNENs, 7 published after the adoption of the Regulation, they were omitted from the list under subheading 4421 90 99.) 5. Heading 4421, the last in the chapter, is for the residual category 'Other articles of wood' and subheading 4421 90 99 is for the most residual of all, 'Other — other — other', that is to say for articles of wood which cannot be classified under any other 8. Regulation No 3009/95, introducing heading or subheading. CN s u b h e a d i n g s 4 4 1 8 90 10 and 4418 90 90, was published in the Official Journal of the European Communities on 30 December 1995. On 2 January 1996, Holz Geenen sought binding tariff infor- mation on the customs classification of its imported articles from the Oberfinanzdi- 6. The goods in issue are known in the rektion (Principal Revenue Office), Munich trade, we are told, as 'laminated window (hereinafter 'the OFD'), which replied that scantlings'. Those which the applicant in they fell w i t h i n CN s u b h e a d i n g the main proceedings, Holz Geenen 4418 90 10, glue-laminated timber. GmbH, imports for its window frames, in lengths of between 76 and 300 cm, are composed of a softwood core with a layer of meranti, a tropical hardwood, glued to each side. The purpose of that composition is said to be to achieve a more economical 9. Holz Geenen asked the OFD to review use of wood rather than any structural its decision, but that review was stayed advantage such as strength. pending a decision by the Commission on the classification of the disputed goods. The Commission's decision took the form of Regulation No 1509/97, in the light of which the OFD upheld its initial view. The Commission states that it adopted the Regulation — and subsequently amended 7. Prior to the adoption of Regulation the CNENs — in order to resolve what it No 1509/97, which made the contested

11. The Finanzgericht seems inclined to be swayed by Holz Geenen's reasoning, but feels itself constrained by the Regulation. It has therefore asked the Court whether the Regulation is invalid in so far as it makes 14. Of those 'following provisions', only the disputed classification. one may be of any possible relevance. General Rule 2(a) reads: 'Any reference in a heading to an article shall be taken to include a reference to that article incom- plete or unfinished, provided that, as pre- sented, the incomplete or unfinished article 12. Article 1 of the Regulation provides: has the essential character of the complete 'The goods described in column 1 of the or finished article. It shall also be taken to annexed table are now classified within the include a reference to that article complete combined nomenclature under the appro- or finished (or falling to be classified as

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OPINION OF MR JACOBS — CASE C-309/98

complete or finished by virtue of this rule), 18. The Commission's power to specify the presented unassembled or disassembled.' classification of goods in the CN derives from Article 9(1)(a) of Regulation No 2658/87, and is governed by the con- ditions laid down in Article 10 thereof, 9 relating to consultation of the Customs Code Committee set up in accordance with Article 247 of Regulation No 2913/92. 15. General Rule 6 applies, mutatis mutan- dis, the same rules to classification under a subheading.

19. The principles governing the exercise of that power have been set out by the Court as follows: 16. There are no notes to Section IX, in which Chapter 44 appears, and only one of the notes to that chapter appears at first sight 8 to have any possible bearing on the classification in issue. Note 3 to Chapter 44 states: 'Headings Nos 4414 to 4421 apply to articles of the respective descriptions '... the Council has conferred upon the of ... laminated wood ... as they apply to Commission, acting in cooperation with such articles of wood.' the customs experts of the Member States, a broad discretion to define the subject- matter of tariff headings falling to be considered for the classification of particu- lar goods ...

23. Second, the 'explanatory notes drawn up, as regards the CN, by the Commission and, as regards the Harmonised Commod- 20. The salient points are that: (i) the ity Description and Coding System, by the Commission enjoys a broad discretion to Customs Cooperation Council, 12... may define the subject-matter of tariff headings; be an important aid to the interpretation of (ii) in exercising that discretion, it must act the scope of the various tariff headings but in cooperation with the Customs Code do not have legally binding force'. 13 Committee; and (iii) it must not for any reason alter the subject-matter of the HS headings or subheadings, that is to say those down to the six-digit level. 24. In addition, 'the intended use of a product may constitute an objective criter- ion for classification if it is inherent to the product, and that inherent character must 21. There is no suggestion in the present be capable of being assessed on the basis of case of any defect in the cooperation with the product's objective characteristics and the Customs Code Committee. The conflict properties'. '14 of views is confined to whether the Com- mission acted properly within its broad discretion or whether, by classifying the goods in question under subheading 4418 90 10, it altered the subject-matter of any heading defined on the basis of the 25. Heading 4418 covers 'builders' joinery HS. and carpentry'. Holz Geenen and the Commission agree with the national court that the articles in question do not consti- tute 'builders' joinery' because they have not yet been shaped or cut for such a use; 22. Consideration of those questions is to be carried out in the light of a number of 11 — See, most recently, the judgment of 28 April 1999 in Case rules laid down in the case-law. First, 'in C-405/97 Mövenpick Deutschland v Hauptzollamt Bre- the interests of legal certainty and for ease men, ECR I-2397, paragraph 18. 12 — Now known as the World Customs Organisation {'WCO'). of verification, the decisive criterion for the The HSENs are drawn up in French and English but also exist in unofficial translations in other languages. 13 — Mövenpick Deutschland, cited in note 11, paragraph 18 of the judgment. 10 — Case C-267/94 France v Commission [1995] ECR I-4845, 14 — Case C-459/93 Thyssen Hantel Logistic [1995] ECR at paragraphs 19 to 21 of the judgment. I-1381, paragraph 13 of the judgment.

'This heading applies to woodwork, includ- 27. Holz Geenen emphasises the references ing that of wood marquetry or inlaid wood, in those notes to glue-laminated timber as used in the construction of any kind of comprising structural, load-bearing ele- building, etc., in the form of assembled ments, and the choice of the term 'timber' goods or as recognised unassembled pieces in English, to support its argument that the (e.g., prepared with tenons, mortises, dove- articles in question do not fall within this tails or other similar joints for assembly), category, even though they consist of glued whether or not with their metal fittings laminations. It points out that 'plywood, such as hinges, locks, etc. veneered panels and similar laminated wood' (heading 4412) are also excluded, despite their laminated nature. Heading 4418 thus in its view covers only structural laminated timber and not all laminated wood. The articles in question are not suitable for such uses; the glues employed are not sufficiently resistant and attention is paid to economy, not strength, in their The term "joinery" applies more particu- manufacture. Because their objective nat- larly to builders' fittings (such as doors, ure and specific use are not covered by the windows, shutters, stairs, door or window terms of heading 4418, the Regulation is frames), whereas the term "carpentry" unlawful in so far as it purports to bring refers to woodwork (such as beams, rafters them within that heading. In Holz Geenen's and roof struts) used for structural pur- view, the articles in question must therefore

29. The issue thus defined is essentially whether the articles in question fall under heading 4418 or not. If they do (the Commission's view), they must fall within one of the subdivisions of 4418 90. If they do not (Holz Geenen's view), they can fall only under heading 4421 and, given the 28. The Commission takes the opposite terms and structure of that heading, sub- view. It states that the terms of heading heading 4421 90 99. It must, however, also 4418 do not refer, to articles classified be borne in mind that some other classifi- according to their purpose or intended cation might be more appropriate. use; the question is what is meant, objec- tively, by 'builders' carpentry'. The inclu- sion of 'shuttering for concrete construc- tional work' demonstrates that not only load-bearing items are covered. The term 'builders' carpentry' ('pièces de charpente' in French) is neutral, and glue-laminated timber is specifically included under the Does classification of the articles in ques- HSENs (the use of the word 'structural' in tion under heading 4418 alter the subject- the English version being of no import, matter of the heading? since the heading is to be interpreted according to its own terms). The fact that 'wood blocks made up of slats glued together and then planed on the four sides' 30. The two approaches taken differ over were formerly included under subheading whether the intended use of the articles is to 4421 90 99 is irrelevant, since heading be taken into account. One of the Com- 4418 cannot be construed on the basis of mission's main submissions is that classifi- that subheading. The reference in the cation under heading 4418 is a matter to be Regulation to the fact that the blocks in determined purely on the basis of objective issue are 'used in the construction of characteristics, and not of intended use, window frames' is also immaterial, since even though the Regulation describes the classification under heading 4418 is not articles in question as 'used in the con- determined by intended use and the blocks, struction of window frames'. Holz Geenen which may be of any length, can be used for contends that the intended use is the other purposes. Even if the word 'timber' in determining criterion, that the articles in English referred only to load-bearing struc- question are not intended (or suitable) for tural items, laminated wood would not be use as 'builders' carpentry' and that even excluded from builders' carpentry, since a though intended for use in window (and heading may not be interpreted on the basis door) frames they cannot come within

(c) Prefabricated buildings (heading 33. It may also be noted that no distinction 94.06).' is made between joinery and carpentry. The fact that the HSENs indicate what is included under each term is thus immater- 15 — At paragraph 26.

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HOLZ GEENEN

35. It thus seems to me clear that the 37. The articles in issue are 'blocks' of heading includes all wooden elements used varying length consisting of layers of wood by builders in the structure of a building glued together. According to the Regula- (floors, walls, partitions, ceilings, roofs tion, they are 'used in the construction of etc., with items such as doors and windows window frames' and Holz Geenen has entering into the structure of walls or stated before the national court that they partitions) or in its construction (scaffold- 'have a variety of uses as non-load-bearing ing, concrete shuttering), with the excep- building components of wood, for example tion of plywood or the like and actual also in doors'. There is no suggestion that prefabricated buildings, which both have they are ever used or intended to be used their own headings. It does not include directly in the construction of any kind of wooden fixtures not forming part of the building or that they are themselves structure (I am intrigued, in this connec- 'builders' fittings' of the same kind as tion, by the idea that builders may nail doors, windows, shutters, stairs, window cupboards to the ceiling). Nor, by virtue of frames or door frames, and it is agreed that General Rule 2(a), does it include articles of they are not recognisable unassembled wood requiring further working by other pieces of such fittings, prepared with specialist trades (such as window makers) tenons, mortises, dovetails or other similar in order to produce wooden elements joints. Nor, indeed, are their objective which are to be used by builders in the characteristics and properties those of items structure of a building or in its construc- which do fall within those categories tion. (unless, perhaps, their composition is such that they must be described as glue-lami- nated timber and all glue-laminated timber must be included under heading 4418, a hypothesis which I shall examine below).

41. The term 'glue-laminated timber' first appears in the HSENs, as a product inclu- ded without further specification under heading 4418, and in both English and French the term used is different from that used in Note 3 to Chapter 44. It was then taken over into subheading 4418 90 10 of the CN as from 1 January 1996 and again the word used in all the official Community languages (with the exception of Portu- guese) is different from that for 'laminated 39. Whilst, according to Note 3 to Chapter wood'. Whilst I would not attach too much 44, 1 7heading 4418 applies — like all the significance to the use of the word 'timber' other headings from 4414 to 4421 — to in English, which is not echoed in other articles of laminated wood as it applies to languages, it seems overwhelmingly clear such articles of wood, that note cannot that something different is meant. bring articles within the heading (or any other heading concerned) merely because they are of laminated wood. And whilst glue-laminated timber may be classified under heading 4418/ in accordance with the HSENs — and it was thus quite per- missible for the Commission to introduce a specific subheading in the CN to accom- modate it — it does not follow that all 42. Consultation of bilingual and mono- wood which is glued and laminated neces- lingual technical dictionaries and works of sarily comes under that subheading. Only reference does not reveal any consistent products which constitute builders' joinery usage of the terms employed in the various and carpentry will do so. This, I think, Community languages. Any one reference clearly explains and is confirmed by the work in any one language may be relied reference in the HSENs to a 'structural upon in support of one view or the other. timber product' ('pièce de charpente'), But the greater and more varied the number rather than a more general definition. of works consulted, the clearer it becomes that the terms used in the HS and the CN do not reflect any systematic terminological 17 — Quoted above in paragraph 16. distinction generally drawn in the trade.

45. All the above reasoning leads me 47. Goods of this kind were presumably towards the view that the Commission imported, by Holz Geenen and others, altered the subject-matter of heading 4418 before the introduction of the subheading by classifying the articles in question under for 'glue-laminated timber' and whatever it. Before confirming that conclusion, how- classification was appropriate then may ever, I propose to consider what the proper presumably serve just as well now. It may classification of the goods in question be that they were classified under subhead- should be. ing 4421 90 99 in accordance with the 1994 version of the CNENs, which the Commission has stated referred to identical goods. That is, indeed, the only alternative heading to have been put forward (by Holz Geenen), since the Commission's sugges- 46. This is not a question which the tion of subheading 4418 90 90 can be no national court has asked, and it is one of more valid than subheading 4418 90 10 if a kind which, as I stated in my Opinion in one takes the view that the articles in Wiener, 1 8it should normally be in a question do not fall under heading 4418 at position to answer for itself. In a case of all. At the hearing, moreover, the Commis- this kind, however, I think it fully consis- sion's representative, when confronted with the hypothesis that the Regulation might not be held valid, tentatively suggested that 18 — Case C-338/95 Wiener v Hauptzollamt Emmerich [1997] subheading 4421 90 99 might be the only ECR I-6495, particularly at paragraph 38 of the Opinion. other possible classification.

50. However, although the fact that head- ings 4414 to 4421 expressly include articles of laminated wood seems to imply that the 49. From Note 3 to Chapter 44 of the CN other headings in Chapter 44 do not (see paragraph 16 above), it is clear that include such articles, that inference cannot headings 4414 to 4421 all include articles hold true for heading 4412, which covers of laminated wood, and there is no dispute 'Plywood, veneered panels and similar that the articles in question here are of laminated wood', divided into 'Plywood wood and are laminated. Headings 4414 consisting solely of sheets of wood, each ('Wooden frames for paintings, photo- ply not exceeding 6 mm thickness', 'Other, graphs, mirrors or similar objects'), 4415 with at least one ply of non-coniferous ('Packing cases, boxes, crates, drums and wood' and 'Other'. Whilst this heading similar packings, of wood; cable-drums, of appears at first sight to refer to panels wood; pallets, box pallets and other load rather than to 'blocks' of the kind in issue boards, of wood; pallet collars, of wood'), here (in fact lengths of up to 3 metres), 4416 ('Casks, barrels, vats, tubs and other closer inspection reveals that such articles coopers' products and parts thereof, of may in some circumstances be included. wood, including staves'), 4417 ('Tools, tool bodies, tool handles, broom or brush bodies and handles, of wood; boot or shoe lasts and trees, of wood'), 4419 ('Table- ware and kitchenware, of wood') and 4420 ('Wood marquetry and inlaid wood; cas- kets and cases for jewellery or cutlery, and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling in Chapter 94') are 51. Note 4 to Chapter 44 states: 'Products all clearly inappropriate. If the articles in of heading No 4410, 4411 or 4412 may be question are to fall under one of the worked to form the shapes provided for in headings which include laminated wood respect of the goods of heading No 4409, under Chapter Note 3, then it must be curved, corrugated, perforated, cut or heading 4421, 'Other articles of wood'. formed to shapes other than square or Not being any of the articles specifically rectangular or submitted to any other named under that heading, they must come operation provided it does not give them under subheading 4421 90, 'Other', which the character of articles of other headings.'

57. Holz Geenen distinguishes the two 54. Indeed, in Amending Supplement products on the basis of their cross-sec- No 22, of June 1998, to the Compendium tional dimensions and of the extent to of (HS) Classification Opinions issued by which they are worked. the WCO, it is stated that, by application of Note 4 to Chapter 44, subheading 4412 99 (the residual subheading for otherwise unclassified items of plywood, veneer and similar laminated wood) includes: 'Rectan- gular pieces of laminated wood (213 cm 58. With regard to the former criterion, I long x 11.26 cm wide x 23.8 mm thick), must say I am not convinced. I do not see used for making a door frame, consisting of any essential difference in nature between a a thick core and two thin outer plies of length of laminated wood used in the coniferous wood, continuously grooved manufacture of door frames, which mea-

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OPINION OF MR JACOBS — CASE C-309/98

59. Nor do I find the degree of difference in working conclusive. The goods classified by the Regulation are explicitly stated to have slightly rounded edges. Continuous shap- ing, including rounding, is one of the criteria for inclusion under heading 4409. I do not think that a lesser degree of rounding of the edges can have the effect of excluding the goods from that heading, provided that they are rounded. The fact that other products may be more distinc- 62. We have no specific information on the tively shaped is not relevant in that regard. thicknesses of the different layers of the products referred to in the Regulation. If the outer layers are of a thickness compar- able to that of the plies of plywood or veneer, which is a question of fact for the national court, the products must in my view be classified under heading 4412 since they are in all other material respects similar to those to which the classification opinion relates. If the three layers are all of 60. The Commission, on the other hand, similar thickness, as was the case with the submits that the difference between the two sample produced by Holz Geenen's repre- types of article lies in the fact that the sentative at the hearing, then, as I have laminated wood referred to in the WCO reasoned above, 20 subheading 4421 90 99 classification opinion has only two very is the only possible classification. thin outer layers. I assume, therefore, that it is something akin to veneered wood, although the outer layers may be thicker 19 — In paragraph 43. than veneer. 20 — In paragraph 49.

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