Court of Justice of the European Communities (including Court of First Instance Decisions)

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Free movement of goods - Quantitative restrictions - Measures having equivalent effect - Products in free circulation - Requirement of an import licence - Prohibition - Exception - Authorization by the Commission pursuant to Article 115 - Requirements concerning declaration of origin and criminal penalties - Whether permissible - Conditions
( EEC Treaty, Arts 30 and 115 )

National rules making the importation from a Member State in which they are in free circulation of products originating in a non-member country subject to the issue of an import licence constitutes a quantitative restriction prohibited by Article 30 of the EEC Treaty, except where the Member State has been authorized by the Commission under Article 115 of the Treaty not to apply Community treatment to the products in question . Where no such authorization has been granted, Member States may not require the exporter to declare, as regards the origin of the products, anything other than what he knows or may reasonably be expected to know; they may attach criminal penalties to the omission or inaccuracy of such a declaration, but not penalties of the kind attaching to false declarations made with a view to effecting prohibited imports, even if the purpose of the false declaration was fraudulent . Where such authorization has been granted, and subject to its limits, Member States may declare that imports effected without an advance licence are subject to the criminal penalties attaching to the undeclared importation of prohibited goods; they may require the importer to declare the origin of the imported products and may attach to any infringement of that obligation the criminal penalties attaching to false declarations made with a view to effecting prohibited imports .

In Case 212/88
REFERENCE to the Court under Article 177 of the EEC Treaty by the cour d' appel, Paris, for a preliminary ruling in the criminal proceedings pending before that court against
F . Levy, residing in Brussels ( Belgium ), and Another,
on the interpretation of Article 30 of the EEC Treaty with regard to national legislation which, on pain of criminal penalties, makes the importation of textile products originating in non-member countries and put into free circulation in another Member State of the Community subject to a system of advance licences and requires importers to state where the imported products first originated,
THE COURT ( Third Chamber )
composed of : M . Zuleeg, President of Chamber, J . C . Moitinho de Almeida and F . Grévisse, Judges,
Advocate General : W . Van Gerven
Registrar : H . A . Ruehl, Principal Administrator
after considering the observations submitted on behalf of
the Government of the French Republic, by M . Belliard and G . de Bergues, acting as Agents,
the Commission of the European Communities, by its Legal Adviser, M . J . Jonczy, and by Mrs Berardis-Kayser, a member of its Legal Department, acting as Agents,
having regard to the Report for the Hearing and further to the hearing on 23 May 1989,
after hearing the Opinion of the Advocate General delivered at the sitting on 15 June 1989,
gives the following
Judgment

1 By judgment of 6 July 1988, which was received at the Court on 1 August 1988, the cour d' appel ( Court of Appeal ), Paris, referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question concerning the interpretation of Article 30 of the Treaty .
2 That question was raised in criminal proceedings in which the accused, Mr Levy and Mr Bazini, were successfully prosecuted before the tribunal de grande instance ( Regional Court ), Paris, for the offence of importing prohibited goods without the appropriate customs declaration, contrary to Article 426(2 ) and ( 3 ) and Article 414 of the French Customs Code . The accused were convicted following the lodging of 22 declarations relating to the importation of textile goods with the French customs office at Le Bourget between 8 March 1976 and 31 May 1977 . The goods, with a value for customs purposes of FF 3 998 357, were imported into France in reusable cardboard boxes or boxes marked "Belgium ". However, the invoices for those goods gave no indication that they had been manufactured in South Korea, Taiwan or Pakistan .
3 The cour d' appel, Paris, hearing the appeal, decided to stay the proceedings on the ground that it was appropriate to submit the following question to the Court for a preliminary ruling :
"Do the requirements of the French legislation and rules concerning the importation into France of textile goods coming from non-member countries and put into free circulation in one of the Member States of the EEC which, on the one hand, oblige importers of such goods in France to obtain an import licence in advance and, on the other hand, define the statements which, subject to the penalties provided for in Article 414 of the French Customs Code, must be included in declarations in respect of imports into France, constitute quantitative restrictions prohibited by Article 30 of the EEC Treaty by virtue of the general principles of Community law as they stand at present?"
4 Reference is made to the Report for the Hearing for a fuller account of the facts of the case, the relevant Community provisions, the course of the procedure and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court .
5 In its question, the national court seeks in substance to ascertain whether Article 30 of the Treaty precludes national legislation which, on pain of criminal penalties, makes the importation of textile products originating in non-member countries and put into free circulation in another Member State of the Community subject to a system of advance licences and requires importers to declare where the products so imported first originated .
6 In its observations to the Court, the French Government states that, at the material time, a Member State was justified, in accordance with Commission Decision 71/202/EEC of 12 May 1971 empowering Member States to take interim protective measures with regard to the importation of certain products originating in third countries and put into free circulation in other Member States ( Official Journal, English Special Edition 1971 ( I ), p . 343 ), in making importation into France of textile products coming from non-member countries and put into free circulation in another Member State to the issue of an import licence . Persons making false import declarations could incur penalties such as those provided for in Article 414 of the French Customs Code, where the inaccuracies or omissions involved were made with a fraudulent purpose .
7 The Commission points out that the system established by Decision 71/202/EEC was to be limited to a system of supervision alone and could not give rise to a prohibition on the importation of a product in free circulation . However, where a Member State established that an importation was likely to give rise to deflections of trade which were capable of preventing the implementation of a measure of commercial policy adopted in conformity with the Treaty, it could ask the Commission to apply the first paragraph of Article 115 of the Treaty . Finally, the Commission considers that, in the context of supervisory measures, a Member State cannot apply penalties without distinguishing between a situation in which a trader has made false declarations with a view to effecting prohibited imports and a situation involving merely an inaccuracy in the declaration made in connection with an importation which could not itself be prohibited, a case in which the submission of documents serves only to monitor the movement of goods .
8 It must be borne in mind that the provisions of Article 30 of the Treaty on the elimination of quantitative restrictions and all measures having equivalent effect are applicable without distinction to products originating in the Community and those which have been put into free circulation in any of the Member States, regardless of where those products first originated . Furthermore, Article 9(2 ) of the Treaty prohibits any administrative procedure which is designed to establish different rules concerning the movement of products according to whether they originate in the Community or they originate in a non-member country but have been put into free circulation in one of the Member States, since the two categories of products are both included without distinction in the same system of free circulation .
9 However, under the system established by the Treaty, the application of those principles is conditional on the introduction of a common commercial policy . In its present incomplete state, differences in commercial policy between the Member States are likely to continue and, in some of those States, may lead to deflections of trade or economic difficulties . It is difficulties of that kind which Article 115 of the Treaty serves to resolve .
10 As is borne out by the Court' s established case-law ( see the judgments of 15 December 1976 in Case 41/76 Donckerwolcke v Procureur de la République (( 1976 )) ECR 1921, of 30 November 1977 in Case 52/77 Cayrol v Rivoira (( 1977 )) ECR 2261, of 28 March 1979 in Case 179/78 Procureur de la République v Rivoira (( 1979 )) ECR 1147 ), only Article 115 of the Treaty gives the Commission the power to authorize the Member States to take protective measures, inter alia in the form of derogations from the principle of free movement of goods, against products originating in non-member countries and put into free circulation in one of the Member States . Except where the substantive and procedural conditions laid down in Article 115 are fulfilled, a Member State cannot be authorized to adopt such protective measures and Decision 71/202/EEC cannot have the effect of conferring upon the Member States a general authorization to that effect .
11 In order to answer the question submitted for a preliminary ruling, therefore, it is necessary to distinguish a situation in which no specific authorization for certain products has been granted pursuant to Article 115 from that where there was such an authorization .
12 In the first situation, it must be borne in mind, in the light of the aforesaid case-law, that a Member State cannot make the introduction into its territory of goods which have been put into free circulation in another Member State subject to the requirement of an import licence .
13 It also follows from that line of cases that, at the material time, the Member States were indeed entitled to request the production of certain documents upon importation of products put into free circulation in another Member State in order to establish the origin of those products or to monitor the movement of goods . Nevertheless, the Member States may not require from the importer more in this respect than an indication of the origin of the products in so far as he knows it or may reasonably be expected to know it .
14 In those circumstances, the Court has held, in particular, that the fact that the importer did not comply with the obligation to declare the real origin of goods cannot give rise to the application of penalties which are disproportionate to the nature of the infringement . Although false declarations of that kind may, where appropriate, attract criminal penalties and although they may be penalized more severely where they are made with fraudulent intent, they cannot, even in the latter case, attract the criminal penalties provided for in the case of false declarations made with a view to effecting prohibited imports .
15 Where, however, the Commission authorizes a Member State, pursuant to Article 115 of the Treaty, not to apply Community treatment to certain specified products, that State may, in order to ensure the actual implementation of the decision in question, introduce a system of prior import licences accompanied by criminal penalties . Nor, within the limits of such an authorization, does Community law preclude the requirement that importers declare where the products first originated and the penalizing of infringements of that obligation by means of the criminal penalties provided for in respect of false declarations made in order to effect prohibited imports .
16 In that regard, the Commission pointed out at the hearing that, at the material time, France had been authorized, pursuant to the first paragraph of Article 115 of the Treaty, to apply protective measures to imports of certain textile products originating in South Korea alone, by not applying Community treatment to them . It is for the national court to ascertain whether the goods in question are covered by that authorization .
17 The answer to the question submitted by the national court must therefore be that national rules making the importation from a Member State in which they are in free circulation of products originating in a non-member country subject to the issue of an import licence constitute a quantitative restriction prohibited by Article 30 of the EEC Treaty, except where the Member State has been authorized by the Commission under Article 115 of the Treaty not to apply Community treatment to the products in question . Where no such authorization has been granted, Member States may not require the exporter to declare, as regards the origin of the products, anything other than what he knows or may reasonably be expected to know; they may attach criminal penalties to the omission or inaccuracy of such a declaration, but not penalties of the kind attaching to false declarations made with a view to effecting prohibited imports, even if the purpose of the false declaration was fraudulent . Where such authorization has been granted, and subject to its limits, Member States may declare that imports effected without an advance licence are subject to the criminal penalties attaching to the undeclared importation of prohibited goods; they may require the importer to declare the origin of the imported products and may attach to any infringement of that obligation the criminal penalties attaching to false declarations made with a view to effecting prohibited imports .

Costs
18 The costs incurred by the French Government and by the Commission of the European Communities, which have submitted observations to the Court, are not recoverable . As these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court .

On those grounds,
THE COURT ( Third Chamber ),
in answer to the question referred to it by the cour d' appel, Paris, by judgment of 6 July 1988, hereby rules :
National rules making the importation from a Member State in which they are in free circulation of products originating in a non-member country subject to the issue of an import licence constitute a quantitative restriction prohibited by Article 30 of the EEC Treaty, except where the Member State has been authorized by the Commission under Article 115 of the Treaty not to apply Community treatment to the products in question . Where no such authorization has been granted, Member States may not require the exporter to declare, as regards the origin of the products, anything other than what he knows or may reasonably be expected to know; they may attach criminal penalties to the omission or inaccuracy of such a declaration, but not penalties of the kind attaching to false declarations made with a view to effecting prohibited imports, even if the purpose of the false declaration was fraudulent . Where such authorization has been granted, and subject to its limits, Member States may declare that imports effected without an advance licence are subject to the criminal penalties attaching to the undeclared importation of prohibited goods; they may require the importer to declare the origin of the imported products and may attach to any infringement of that obligation the criminal penalties attaching to false declarations made with a view to effecting prohibited imports .