C-317/99

Those additional duties are payable if the price of the imported goods is lower than a particular threshold or trigger price. 3. Towards the end of 1995, the Nether- lands company Kloosterboer Rotterdam BV ('Kloosterboer'), a customs agent, imported — on behalf of certain cli- ents — a number of consignments of fro- At issue in the present case is the validity of zen chicken breasts from Brazil. Initially, the procedural requirements laid down by the customs authorities took the view that the Commission for the purpose of deter- no additional duty was payable, since the mining, each time those products are price actually paid for the goods (cif import imported, whether it is appropriate to price), 2as it appeared on the invoice, was impose additional duties, that is to say, higher than the threshold price below whether the price of a particular consign- ment is to be regarded as lower than the trigger price. In addition, a series of ques- 2 — That term includes the value of the goods, the cost of tions concerning interpretation arise, which insurance and transport (Cost Insurance Freight). Regula- tion No 493/1999 (cited in footnote 18 below) includes in cif import prices: (a) the fob price in the country of origin (Free on Board, namely including only the value of the goods) and (b) transport and insurance costs to the point of 1 — Original language: Spanish. introduction into the customs territory of the Community.

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which the commercial safeguard mechan- authorities had made a mistake, since, as a ism applied (trigger price) and which, at the professional customs agent, it should rea- material time, amounted to NLG 714 per sonably have recognised that a mistake had 100 kg net. been made.

5. Since the goods had already been released, it was not possible to make a request having retroactive effect, with the 7. Article 3(1) of Regulation No 1484/95 result that the debt had to be deemed to provided that 'at the request of the impor- have been incurred after clearance, whilst ter the additional duty may be established Kloosterboer was not able to raise any on the basis of the cif import price of the objection on the ground that the customs consignment in question, if this price is higher than the applicable representative price'. Furthermore, the request for the cif 3 — Commission Regulation (EC) No 1484/95 of 28 June 1995 import price to apply had to be accompa- laving down detailed rules for implementing the system of additional import duties and fixing additional import duties nied by certain documents (the purchasing in the poultrymeat and egg sectors and for egg albumin, and contract, the insurance contract, the trans- repealing Regulation No 163/67/EEC (OJ 1995 L 145, p. 47) (unamended version). port contract, the bill of lading, the invoice,

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the certificate of origin), for the purpose of However, Article 5(3) of that basic regula- showing that the price declared was accu- tion merely provides that the prices to be rate (Article 3(2)). At the same time, secur- taken into consideration for imposing an ity had to be lodged equal to the amount of additional import duty 'shall be determined additional duty which would have been on the basis of the cif import prices of the paid if the additional duty had been consignment in question'. The same provi- calculated on the basis of the representative sion also enables the cif prices declared to price applicable to the product. The impor- be checked against the representative prices ter would recover the security if he showed for the product in question. that he had sold the consignment on conditions that proved that the prices declared were accurate.

10. Among the special safeguard provi- sions, Article 5(1)(b) of the Agreement on 8. Regulation No 1484/95 was adopted by Agriculture provides that any Member of the Commission for the purpose of imple- the World Trade Organisation ('WTO') menting Council Regulation (EEC) may impose additional duties on the impor- No 2777/75, 4 as it stood following the tation of certain products if the price at e n t r y i n t o force of R e g u l a t i o n which imports of that product may enter its No 3290/94. 5 customs territory, 'as determined on the basis of the cif import price of the shipment concerned, expressed in terms of its domes- 4 — Council Regulation (EEC) No 2777/75 of 29 October 1975 tic currency', falls below the trigger price. 6 on the common organisation of the market in poultrymeat (OJ 1975 L 282, p. 77). 5 — Council Regulation (EC) No 3290/94 of 22 December 1994 on the adjustments and transitional arrangements required 6 — Equal to the average 1986 to 1988 reference price for the in the agriculture sector in order to implement the product calculated either as the average cif unit value of the agreements concluded during the Uruguay Round of multi- product concerned or in terms of the quality of the product lateral trade negotiations (OJ 1994 L 349, p. 105). and its stage of processing.

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Can an initial failure to submit a request be in force as regards the customs declaration' rectified? (Article 220(2)(b)).

The questions referred for a preliminary ruling 11. The legislation which applies in rela- tion to the amendment of customs declara- tions is found in the Community Customs Code. 7 According to subparagraph (c) of the second paragraph of Article 65, no 13. Kloosterboer brought successive amendment is permitted where authorisa- administrative and judicial appeals against tion is requested after the customs autho- the inspector's demands for payment. rities have allowed the goods to be released.

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duty is the representative price referred — the declarant otherwise complied to in Article 2(1) of Regulation (EC) with all conditions of the applic- No 1484/95? able provisions relating to customs declarations?

2. If the first question is answered in the affirmative: 3. If the second question is answered in the affirmative:

Is it in accordance with Community law, and in particular with the principle of the protection of legitimate expecta- tions, if, where no request has been Does that affirmative answer still apply made under Article 3(1) of Regulation if, in addition to the circumstances (EC) No 1484/95, the customs debt is mentioned in the second question, the calculated pursuant to Article 3(3) declarant in question has taken cogni- thereof, where: sance of the "Verification Notices" issued in connection with earlier declarations which he made, as repro- duced in paragraph 2.2, second indent, of this decision?

— the cif price of the consignment in question indicated on the declara- tion is higher than the trigger price;

15. The first three questions concern var- ious aspects of the validity of Article 3(1) of Regulation No 1484/95 as it originally stood: the first, from the point of view of the basic regulation; the second and third, 5. If the fourth question is answered in the from the point of view of the principle of affirmative: legitimate expectations and in the light of the circumstances of the case.

Is it in accordance with Community law, in particular Article 220(2)(b) of 16. The national court's doubts, expressed Regulation (EEC) No 2913/92 and the in its first question, are wholly justified. In principle of the protection of legitimate my opinion, the obligation to make a expectations, for subsequent entry to specific request for the cif price to apply be made in the accounts under Arti- at the time when the additional import duty cle 220(1) of that regulation in the is established is invalid on two grounds. circumstances described in the second question?

17. First, it is invalid because there is no 6. If the fifth question is answered in the adequate foundation for it in the basic negative: legislation, namely Regulation No 2777/75, as amended.

Must the fifth question also be answered in the negative if the circum- 18. Second, it is invalid because it is also stances outlined in the third question contrary to the provisions of Article 5(1) of obtain?' the Agreement on Agriculture.

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23. However, paragraphs (1) and (3) of lated on a basis which is different from the Article 3 of Regulation No 1484/95, as representative price' (third recital). 8 they originally stood, take the opposite approach: '[a]t the request of the importer the additional duty may be established on the basis of the cif import price of the consignment' when that price is higher than the representative price and certain docu- 25. The fact that the clear meaning of the mentary proof is provided. In any other basic regulation has been distorted by the case, the representative price is to be taken implementing legislation is sufficient, in into consideration. itself, to render the latter invalid.

26. The Commission's argument concern- ing the discretion it enjoys in the exercise of its legislative powers is irrelevant. The Commission is authorised to adopt all the Despite first appearances, the effect of the measures which are necessary or appropri- mechanism in Regulation No 1484/95 is to ate for the implementation of the basic elevate the reference to the representative legislation, but they must never be contrary price to a rule which applies unless a to such legislation. 9 specific request is made for the cif import price to apply, a case which thereby becomes the exception.

The validity of Article 3(1) and (3) of Regulation No 1484/95 in the light of Article 5(1) of the Agreement on Agricul- ture

24. In that regard, the preamble to Regula- tion No 1484/95 speaks for itself. There it is unequivocally stated that 'the import 27. The fact that the provision at issue is prices to be taken into consideration for void becomes even more apparent, were imposing an additional import duty should that possible, in the light of the interna- be checked against the representative prices on the world market or on the Community import market for the products in question' 8 — Emphasis added. (second recital) and that 'the importer may 9 — See, inter alia, Case C-48/98 Sohl & Söhlke [1999] ECR I-7877, paragraph 36, to which the Commission refers in its choose that the additional duty is calcu- observations.

31. More specifically, Article 5(4) of Reg- ulation No 2777/75, as amended by Reg- 29. However, that ceases to be the case ulation No 3290/94, enables and requires where 'the Community intended to imple- the Commission to adopt detailed imple- ment a particular obligation assumed in the menting rules and specifies in that regard context of the WTO, or where the Com- that '[s]uch detailed rules shall specify in munity measure refers expressly to the particular: (a) the products to which addi- precise provisions of the WTO agreements'. tional import duties shall be applied under In such cases, it is for the Court to review the terms of Article 5 of the Agreement on the legality of the Community measure in Agriculture; (b) the other criteria necessary question in the light of the WTO rules. 11 to ensure application of [the special safe- guard mechanism] in accordance with Article 5 of that Agreement [on Agricul- ture]' . 13

30. The same is true of the Community legislation in the present case. The third recital in the preamble to Council Regula- 32. Thus, the Community measure refers specifically to actual provisions of the 10 —Case C-149/96 Portugal v Council [1999] ECR I-8395, WTO. Further, the Council was anxious paragraph 47. 11 —Ibid., paragraph 49. Case 70/87 Fediol v Commission [1989] ECR 1781, paragraphs 19 to 22, and Case C-69/89 Nakajima v Council [1991] ECR I-2069, paragraph 31, 12 — Emphasis added. are to the same effect, although in relation to the 1947 13 — The formula uniformly applied to various arrangements GATT. for the common organisation of markets. Emphasis added.

36. The legal question raised before the Appellate Body was whether, for the pur- poses of establishing the additional duty, it 33. Therefore, under Article 5(1 )(b) of the was permissible for a member of the WTO Agreement on Agriculture, additional to offer the importer a choice between the duties exceeding the customs duty may be use of the cif price of the shipment and imposed for certain products — including another method of calculation which those at issue in the main proceedings 15 — departs from that principle, which might 'if the price at which imports of that be based on the representative price pro- product may enter the customs territory vided for in Regulation No 1484/95. 16 of the Member [of the WTO] granting the concession, as determined on the basis of the cif import price of the shipment con- cerned expressed in terms of its domestic currency, falls below a trigger price equal to the average 1986 to 1988 reference price for the product concerned'. 37. The Appellate Body concluded that the use of a basis other than the cif price of the shipment concerned for the calculation of any additional duty was inconsistent with the obligations under Article 5 of the Agreement on Agriculture, 1 7founding its conclusion on both the ordinary meaning of the words and their context. As regards the latter, it pointed out that, since the 34. Article 5(1) of the Agreement on Agri- provision made by Article 5 of the Agree- culture makes the cif import price of each ment on Agriculture involves a special individual shipment the only criterion for safeguard mechanism that operates auto- determining any additional duties.

38. I fully concur with the arguments of the WTO Appellate Body and I recommend that paragraphs (1) and (3) of Article 3 of 41. However, as a result of the report of the Regulation No 1484/95 in the version WTO Appellate Body mentioned above, applicable to the present case should be the Commission adopted Regulation (EC) declared void, inasmuch as they make the No 493/1999 1 9 amending Regulation representative price the general basis for No 1484/95. The current wording of Arti- establishing additional duty, requiring the cle 3(1) of Regulation No 1484/95 pro- trader concerned to make a specific request vides that 'additional duty shall be estab- for the cif price to apply. lished on the basis of the cif import price of the consignment concerned'. If the price declared is higher than the representative price, the importer remains obliged to submit documents in support and to pro- vide security. Therefore, it is no longer necessary to make the prior request at issue in the main proceedings, whilst the anti- 39. Before the Court, the Commission fraud measures found in the earlier legisla- defended the legality of the obligation to tion have not been abandoned. make a specific request, pointing out that the need to combat fraud justifies both making application of the declared cif price conditional upon the lodging of certain documents as evidence of its accuracy and requiring the provision of security.

42. Consequently, the Commission's argu- ments are unfounded and it is not necessary to ascertain whether they would have been 40. Although the Commission has a legit- sufficient to remedy the two grounds of imate interest in combating fraud, it ought invalidity which I have pointed out above.

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