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

Provisional text

JUDGMENT OF THE COURT (Ninth Chamber)

21 September 2023 (*)

(Reference for a preliminary ruling – Customs union – Regulation (EU) No 952/2013 – Union Customs Code – Article 60(2) – Acquisition of origin of goods – Delegated Regulation (EU) 2015/2446 – Article 32 – Goods the production of which involves more than one country or territory – Annex 22-01 – Primary rule applicable to goods under subheading 7304 41 of the Harmonised System – Concept of ‘hollow profile’ – Steel ‘tube blanks’ under subheading 7304 49 of the Harmonised System, obtained by hot-forming and enabling the production of steel tubes by cold forming, under subheading 7304 41 of the Harmonised System – Validity of the primary rule)

In Case C‑210/22,

REQUEST for a preliminary ruling under Article 267 TFEU from the Finanzgericht Hamburg (Finance Court, Hamburg, Germany), made by decision of 2 March 2022, received at the Court on 18 March 2022, in the proceedings

Stappert Deutschland GmbH

v

Hauptzollamt Hannover,

THE COURT (Ninth Chamber),

composed of D. Gratsias, President of the Tenth Chamber, acting as President of the Ninth Chamber, S. Rodin (Rapporteur) and O. Spineanu-Matei, Judges,

Advocate General: P. Pikamäe,

Registrar: K. Hötzel, Administrator,

having regard to the written procedure and further to the hearing on 9 March 2023,

after considering the observations submitted on behalf of:

–        Stappert Deutschland GmbH, by K.H. Felderhoff, Rechtsanwalt, K. Harden, Rechtsanwältin, and H.-M. Wolffgang, Steuerberater,

–        the Hauptzollamt Hannover, by T. Röper,

–        the Belgian Government, by S. Baeyens and P. Cottin, acting as Agents, assisted by B. Coene and Z.-Z. De Decker, acting as experts,

–        the Hungarian Government, by M.Z. Fehér and K. Szíjjártó, acting as Agents,

–        the European Commission, by B.-R. Killmann, F. Moro and M. Salyková, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1        This request for a preliminary ruling concerns the interpretation of the primary rule applicable to goods under subheading 7304 41 of the Harmonised Commodity Description and Coding System (‘the HS’), provided for in Annex 22-01 to Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015 supplementing Regulation (EU) No 952/2013 of the European Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs Code (OJ 2015 L 343, p. 1), as amended by Commission Delegated Regulation (EU) 2018/1063 of 16 May 2018 (OJ 2018 L 192, p. 1) (‘the primary rule’), in so far as it contains a specific criterion relating to ‘hollow profiles of No 7304 49’ (‘the criterion relating to hollow profiles’) and on the validity of that rule.

2        The request has been made in proceedings between Stappert Deutschland GmbH (‘Stappert’) and the Hauptzollamt Hannover (Principal Customs Office, Hanover, Germany; ‘the customs office’) concerning the acquisition of origin of straight hollow products of regular thickness under HS subheading 7304 41.

 Legal context

 International law

3        The HS was established by the International Convention on the Harmonized Commodity Description and Coding System, concluded in Brussels on 14 June 1983 (United Nations Treaty Series, Vol. 1503, p. 4, No 25910 (1988)), within the framework of the World Customs Organization (WCO), and approved, with its protocol of amendment of 24 June 1986, on behalf of the European Economic Community by Council Decision 87/369/EEC of 7 April 1987 (OJ 1987 L 198, p. 1). The Explanatory Notes to the HS are drawn up within the WCO in accordance with the provisions of that convention.

4        Chapter 72 of the HS is entitled ‘Iron and steel’.

5        The Explanatory Notes to the HS relating to Chapter 72, which apply mutatis mutandis to the products of Chapter 73 thereof, state, under the heading ‘General’:

‘…

(IV)      Production of finished products

Semi‑finished products and, in certain cases, ingots are subsequently converted into finished products.

These are generally subdivided into flat products (“wide flats”, including “universal plates”, “wide coil”, sheets, plates and strip) and long products (bars and rods, hot-rolled, in irregularly wound coils, other bars and rods, angles, shapes, sections and wire).

These products are obtained by plastic deformation, either hot, directly from ingots or semi-finished products (by hot-rolling, forging or hot-drawing) or cold, indirectly from hot finished products (by cold-rolling, extrusion, wire-drawing, bright-drawing), followed in some cases by finishing operations (e.g., cold-finished bars obtained by centre-less grinding or by precision turning).

…

(B)      Cold plastic deformation

…

Cold-worked products can be distinguished from hot-rolled or hot-drawn products by the [following criteria]:

–        the surface of cold-worked products has a better appearance than that of products obtained by a hot process and never has a layer of scale;

–        the dimensional tolerances are smaller for cold-worked products;

–        thin-flat products (thin “wide coil”, sheets, plates and strip) are usually produced by cold-reduction;

–        microscopic examination of cold-worked products reveals a marked deformation of the grains and grain orientation parallel to the direction of working. By contrast, products obtained by hot processes show almost regular grains owing to recrystallisation;

…’

6        The general considerations in the Explanatory Notes to the HS relating to Chapter 73 thereof state:

‘…

… the expressions “tubes and pipes” and “hollow profiles” have the following meanings hereby assigned to them:

(1)      Tubes and pipes:

Concentric hollow products, of uniform cross‑section with only one enclosed void along their whole length, having their inner and outer surfaces of the same form. Steel tubes are mainly of circular, oval, rectangular (including square) cross‑sections … [They] may include equilateral triangular and other regular convex polygonal cross‑sections. Products of cross‑section other than circular, with rounded corners along their whole length, and tubes with upset ends, are also to be considered as tubes. They may be polished, coated, bent (including coiled tubing), threaded and coupled or not, drilled, waisted, expanded, cone shaped or fitted with flanges, collars or rings.

(2)      Hollow profiles

Hollow products not conforming to the above definition and mainly those not having their inner and outer surfaces of the same form.

The General Explanatory Note to Chapter 72 applies, mutatis mutandis, to this Chapter.’

7        The Explanatory Note concerning heading 7304 of the HS states:

‘…

Tubes, pipes and hollow profiles of this heading may be manufactured by the following processes:

…

(B)      Hot‑extrusion in a press using glass (Ugine‑Sejournet process) or another lubricant, of a round. This method actually includes the following operations: piercing, expansion or not, and extrusion.

The operations described above are followed by different finishing operations:

–        hot‑finishing: in this case, the blank after reheating passes through a sizing mill or a stretching mill and finally a straightening mill or

–        cold‑finishing on a mandrel, by cold‑drawing on a bench or cold‑rolling (cold‑reducing) in a pilger mill (Mannesmann or Megaval process). These operations give the possibility to obtain from hot‑rolled or extruded tubes, used as blanks, tubes of lesser wall thickness (it should be noted that the Transval process allows tubes of reduced wall thickness to be directly produced) or diameter, also tubes of tighter tolerances on diameter or wall thickness. Cold‑working methods also cover honing and roller burnishing to obtain polished surfaces (tubes with a low degree of roughness) required, e.g., for pneumatic jacks or hydraulic cylinders.

…

See the General Explanatory Note to this Chapter concerning the distinction between tubes and pipes on the one hand and hollow profiles on the other.

…’

 European Union law

 The Customs Code

8        Article 33 of Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (OJ 2013 L 269, p. 1, and corrigendum OJ 2016 L 267, p. 2; ‘the Customs Code’), entitled ‘Decisions relating to binding information’, provides in paragraph 1:

‘The customs authorities shall, upon application, take decisions relating to binding tariff information (BTI decisions), or decisions relating to binding origin information (BOI decisions).

…’

9        Article 60 of the Customs Code, entitled ‘Acquisition of origin’, provides in paragraph 2 thereof:

‘Goods the production of which involves more than one country or territory shall be deemed to originate in the country or territory where they underwent their last, substantial, economically justified processing or working, in an undertaking equipped for that purpose, resulting in the manufacture of a new product or representing an important stage of manufacture.’

10      Article 62 of the Customs Code, titled ‘Delegation of power’, provides:

‘The Commission shall be empowered to adopt delegated acts in accordance with Article 284, laying down the rules under which goods, whose determination of non-preferential origin is required for the purposes of applying the Union measures referred to in Article 59, are considered as wholly obtained in a single country or territory or to have undergone their last, substantial, economically justified processing or working, in an undertaking equipped for that purpose, resulting in the manufacture of a new product or representing an important stage of manufacture in a country or territory, in accordance with Article 60.’

11      Article 284 of that code, entitled ‘Exercise of the delegation’, sets out the detailed rules for that exercise.

 Delegated Regulation 2015/2446

12      In the exercise of the power conferred on it by Article 62 of the Customs Code, the Commission adopted Delegated Regulation 2015/2446.

13      Recital 20 of that delegated regulation states:

‘By Decision 94/800/EC [of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986‑1994) (OJ 1994 L 336, p. 1)] the Council approved the Agreement on Rules of Origin (WTO-GATT 1994), annexed to the final act signed in Marrakesh on 15 April 1994. The Agreement on Rules of Origin states that specific rules for origin determination of some product sectors should first of all be based on the country where the production process has led to a change in tariff classification. Only where that criterion does not allow to determine the country of last substantial transformation can other criteria be used, such as a value added criterion or the determination of a specific processing operation. Considering that the Union is party to that Agreement it is appropriate to lay down provisions in the Union customs legislation reflecting those principles laid down in that Agreement for the determination of the country where goods underwent their last substantial transformation.’

14      Article 32 of that delegated regulation, entitled ‘Goods the production of which involves more than one country or territory (Article 60(2) of the [Customs] Code)’, provides:

‘Goods listed in Annex 22-01 shall be considered to have undergone their last substantial processing or working, resulting in the manufacture of a new product or representing an important stage of manufacture, in the country or territory in which the rules set out in that Annex are fulfilled or which is identified by those rules.’

15      Annex 22-01 to that regulation is entitled ‘Introductory notes and list of substantial processing or working operations conferring non-preferential origin’. That annex includes a part entitled ‘Introductory Notes’, points 2 and 3 of which are worded as follows:

‘2.      Application of the rules in this Annex

2.1.      The rules provided in this Annex are to be applied to goods on the basis of their classification in the [HS], as well as on further criteria which may be provided for in addition to the [HS] headings or subheadings created specifically for the purposes of this Annex. A [HS] heading or subheading which is further subdivided using such criteria is referred to in this Annex as “split heading” or “split subheading”. …

Classification of goods within headings and subheadings of the [HS] is governed by the General rules for the interpretation of the [HS] and any relative Section, Chapter and Subheading Notes to that System. Those rules and notes form part of the Combined Nomenclature, which is set out in Annex I to Council Regulation (EEC) No 2658/87 [of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff (OJ 1987 L 256, p. 1) (“CN”)]. For the purposes of the identification of a correct split heading or subheading for certain goods in this Annex, the General rules for the interpretation of the [HS] and any relative Section, Chapter and Subheading notes to that System, are to apply mutatis mutandis, unless otherwise required in this Annex.

…

3.      Glossary

The primary rules at subdivision level, when they are based on a change in tariff classification, can be expressed using the following abbreviations.

CC:      change to the chapter in question from any other chapter

…’

16      Chapter 73 of that annex is entitled ‘Articles of iron or steel’. It includes, inter alia, ‘Chapter residual rule:’, worded as follows:

‘Where the country of origin cannot be determined by application of the primary rules, the country of origin of the goods shall be the country in which the major portion of the materials originated, as determined on the basis of the value of the materials.’

17      Chapter 73 contains a table setting out the primary rules to be applied for the purpose of determining the country or territory of origin of the goods referred to therein and identified according to their heading or subheading in the HS, in particular the primary rule applicable to pipes and tubes of cold-drawn or cold-rolled stainless steel, of seamless stainless steel, of circular cross-section under HS subheading 7304 41. That table reads as follows:

 The dispute in the main proceedings and the questions referred for a preliminary ruling

18      On 20 January 2016, Stappert, a steel trading company, applied to the Customs Office for a BOI decision, in accordance with Article 33 of Regulation No 952/2013, with a view to importing from South Korea seamless stainless steel pipes and tubes under HS subheading 7304 41 (‘the pipes concerned’). The manufacturing process of the pipes is as follows: solid steel ingots are initially transformed in China by means of hot plastic deformation by extrusion in a press (hot-forming). The semi-finished products obtained in this way (‘the tube blanks’) fall under HS subheading 7304 49. The tube blanks are then sent to South Korea where they are cold-rolled and drawn to form pipes. According to Stappert, South Korea must be designated as the country of origin of the pipes concerned, in accordance with Article 60(2) of the Customs Code. As a result, no anti-dumping duty should be levied on imports of those pipes, which would not be the case if the country of origin were China.

19      By decision of 16 June 2017, the customs office found that the pipes had the same non-preferential origin as the tube blanks, namely China. According to the customs office, in accordance with the primary rule, the origin of the pipes had to be established on the basis of the country of manufacture of the tube blanks.

20      Stappert lodged an objection against that decision, claiming that the final, economically justified stage of substantial transformation must be decisive for the acquisition of origin. In the present case, the latter stage is carried out in South Korea.

21      By decision of 23 November 2018, the customs office rejected that objection. According to the customs office, first, there is no change in the tariff heading in South Korea. Second, contrary to Stappert’s contention, the tube blanks manufactured in China cannot be regarded as ‘hollow profiles’ under HS subheading 7304 49, within the meaning of the criterion relating to hollow profiles, which are then cold processed in South Korea. According to the customs office, the concept of ‘hollow profiles’ must be interpreted in accordance with the Explanatory Notes to the HS relating to Chapter 73 and it follows that the tube blanks are not ‘hollow profiles’ but ‘pipes’.

22      Stappert brought an action before the referring court, the Finanzgericht Hamburg (Finance Court, Hamburg, Germany), seeking to obtain, primarily, a BOI finding that South Korea is the country of origin of the pipes concerned and, in the alternative, a declaration that the customs office’s refusal to establish that origin was unlawful.

23      In that context, the referring court asks, first of all, whether the concept of ‘hollow profiles’, within the meaning of the primary rule, covers products such as tube blanks.

24      In the first place, according to that court, the scope of that concept cannot be inferred from the origins of the primary rule, more particularly by reference to documents drawn up during the negotiations which took place in the context of the work programme relating to the Agreement on Rules of Origin, referred to in recital 20 of Delegated Regulation 2015/2446, which do not specify what is to be understood by ‘hollow profiles’ under HS subheading 7304 49.

25      In the second place, according to the referring court, preference should be given to the interpretation which best meets the criteria of assessment linked to origin, and an interpretation in tariff terms should not run counter to the criteria laid down in Article 60(2) of the Customs Code.

26      In the third place, the referring court states that the introductory notes to Annex 22-01 to Delegated Regulation 2015/2446 do not refer to the Explanatory Notes to the HS.

27      In the fourth place, that court considers that the manufacturing process envisaged in the primary rule is that described in particular in the Explanatory Notes to the HS relating to heading 7304, from which it could be inferred that hot-rolled or hot-formed tubes are used as intermediate products, and therefore correspond to ‘hollow profiles’ within the meaning of that criterion.

28      In the fifth place, there is no uniform taxonomy for the description of the transactions at issue in the main proceedings.

29      In the sixth place, if the concept of ‘hollow profile’ were to be interpreted in accordance with the Explanatory Notes to the HS relating to Chapter 73, the acquisition of origin would depend solely on the form of the material, which appears to the referring court to be an arbitrary application of Article 60(2) of the Customs Code.

30      In addition, it is apparent from recital 33 of Commission Implementing Regulation (EU) 2017/2093 of 15 November 2017 terminating the investigation concerning possible circumvention of the anti-dumping measures imposed by Council Implementing Regulation (EU) No 1331/2011 on imports of certain seamless pipes and tubes of stainless steel originating in the People’s Republic of China by imports consigned from India, whether declared as originating in India or not, and terminating the registration of such imports imposed by Commission Implementing Regulation (EU) 2017/272 (OJ 2017 L 299, p. 1), that the cold forming substantially transforms a tube or pipe and irreversibly alters its essential characteristics, so that its dimensions and physical, mechanical and metallurgical properties are altered, as is apparent from the general considerations in the Explanatory Notes to the HS relating to Chapter 72, which are relevant to Chapter 73 of the HS.

31      In the seventh place, the referring court is of the opinion that, from a technical point of view, an interpretation of the concept of ‘hollow profile’ on the basis of the Explanatory Notes to the HS relating to Chapter 73 is of no practical relevance. The conversion of a hollow profile by cold forming, within the meaning of the definition set out in those explanatory notes, although technically possible, would entail prohibitive costs, such that the manufacturing process of the most used pipes would be the cold-working of hot-worked pipes.

32      In the eighth place, according to that court, not all products under HS subheading 7304 49 are capable of being processed. However, the tube blanks are products which, for their part, can be used only once processed. In that regard, the fact that the material from which pipes under HS subheading 7304 41 are manufactured has not been the subject of conformity tests by reference to an industrial standard relating to seamless pipes and tubes for hot-working shows that that material must necessarily be further processed.

33      Next, in the event that the origin of the pipes concerned is not to be determined in accordance with the criterion relating to hollow profiles or if it proves impossible to answer the first question, the referring court asks whether that criterion is invalid by reason of a failure to state reasons, a lack of precision or incompatibility with Article 60(2) of the Customs Code.

34      Lastly, the referring court asks, if the primary rule were to be declared invalid in so far as it relates to the hollow profiles criterion, which rule of EU law would then have to be applied in order to determine the origin of the pipes concerned.

35      In those circumstances, the Finanzgericht Hamburg (Finance Court, Hamburg) decided to stay the proceedings and seek a preliminary ruling from the Court on the following questions:

‘(1)      Does the term “hollow profiles” [within the meaning of the primary rule], which makes the acquisition of origin conditional on the “change from hollow profiles of subheading 7304 49” … cover hot-formed [goods] under [HS] subheading 7304 49 …, straight and of uniform wall thickness, which [do] not meet the requirements of a technical standard for seamless hot-formed stainless steel pipes and from which pipes with different cross-section and wall thickness are produced by cold-working?

(2)      If the first question is answered in the negative or need not be answered: [is the criterion relating to hollow profiles contrary to] Article 60(2) … and [Article] 284 [of the Customs Code, as well as to Article] 290 TFEU because

(a)      it lacks reasons,

(b)      it is too vague or

(c)      machining processes are excluded from the determination of origin, which would confer origin under Article 60(2) [of the Customs Code]?

(3)      If the second question is answered in the affirmative: is the acquisition of the origin of goods in [HS] subheading 7304 41 … in the main proceedings determined [by the primary rule] “CTH”, the residual rule [laid down in] Chapter 73 [of] Annex 22-01 [to Delegated Regulation 2015/2446] or [by] Article 60(2) [of the Customs Code]?’

 The questions referred for a preliminary ruling

 The first question

36      By its first question, the referring court asks, in essence, whether the primary rule must be interpreted as meaning that the concept of ‘hollow profile’, within the meaning of that rule, covers a hot-formed ‘tube blank’, straight and of uniform wall thickness, which does not meet the requirements of a technical standard relating to hot-formed, seamless, stainless steel pipes and from which, by cold forming, pipes with a different cross-section and wall thickness are manufactured, under HS subheading 7304 41.

37      In accordance with the primary rule, tubes, pipes and hollow profiles under HS subheading 7304 41 are deemed to originate in the country where they were produced by means of drawing or cold-rolling (cold reduction) if they were manufactured from products under another HS heading or ‘hollow profiles of HS subheading 7304 49’.

38      It is apparent from point 2.1 of the introductory notes to Annex 22-01 to Delegated Regulation 2015/2446, first, that the rules set out in that annex must be applied to goods on the basis of their classification in the HS and other criteria which may be added to the headings or subheadings of that system which were created specifically for the purposes of that annex and, second, that, in order to determine the appropriate heading or subheading for certain goods referred to in that annex, the general rules for the interpretation of the HS and any notes relating to the sections, chapters and subheadings of that system apply mutatis mutandis, unless otherwise specified in Annex 22-01.

39      Furthermore, as regards the interpretation of the HS headings and subheadings, it must be borne in mind that the Explanatory Notes to the HS may be regarded as useful aids for that purpose (see, to that effect, judgment of 18 June 2020, Hydro Energo, C‑340/19, EU:C:2020:488, paragraph 36).

40      According to the general considerations in the Explanatory Notes to the HS relating to Chapter 73, to which the explanatory note to heading 7304 thereof makes explicit reference, concentric hollow products of uniform cross-section with only one enclosed void along their whole length, having their inner and outer surfaces of the same form, constitute ‘tubes and pipes’ within the meaning of Chapter 73 of the HS, whereas hollow products not conforming to the definition of tubes and pipes and, in particular, those not having their inner and outer surfaces of the same form, constitute ‘hollow profiles’.

41      By contrast, the concept of ‘tube blank’ is not mentioned in the general considerations mentioned in the preceding paragraph. It follows that, for the purposes of applying the primary rule, products described as ‘tube blanks’ are either ‘tubes and pipes’ or ‘hollow profiles’ within the meaning of Chapter 73 of the HS.

42      It is apparent from the documents before the Court that the pipes concerned, which Stappert intends to import, were obtained from tube blanks pertaining to the concept of ‘tubes and pipes’, within the meaning of the Explanatory Notes to the HS relating to Chapter 73, as referred to in paragraph 40 above, in particular in so far as they are described as straight and with a uniform wall thickness.

43      As such, those tube blanks cannot therefore fall within the concept of ‘hollow profile’, whether within the meaning of Chapter 73 of the HS or the primary rule.

44      It must be stated, in that regard, that it is in no way apparent from the definitions of the concepts of ‘hollow profile’ and of ‘tube’ or of ‘pipe’ referred to in paragraph 40 above that the products thus referred to must comply with the requirements of a technical standard in order for them to fall within those concepts.

45      Furthermore, the fact that, in particular, the Explanatory Notes to the HS relating to heading 7304 describes a process of production of pipes by means of cold processing from hot-drawn or hot-rolled tubes used as blanks, without mentioning the production of tubes or pipes from hollow profiles, does not necessarily mean that the latter production is not possible, since that explanatory note states, moreover, that tubes, pipes and hollow profiles under HS heading 7304 ‘may be manufactured by [various] processes’.

46      The referring court notes that an interpretation of the concept of ‘hollow profile’ referred to in the primary rule in a manner consistent with the indications set out in the Explanatory Notes to the HS relating to Chapter 73 would be such as to call into question the validity of that rule, in the light, in particular, of Article 60(2) of the Customs Code.

47      Indeed, in accordance with a general principle of interpretation, an EU measure must be interpreted, as far as possible, in such a way as not to affect its validity (see, to that effect, judgment of 13 September 2018, UBS Europe and Others, C‑358/16, EU:C:2018:715, paragraph 53 and the case-law cited).

48      However, an interpretation of the concepts in the primary rules which departs from their scope for the purposes of the HS would undermine the internal consistency of Delegated Regulation 2015/2446 (see, by analogy, judgment of 17 June 2021, Czech Republic v Commission, C‑862/19 P, EU:C:2021:493, paragraph 52).

49      It follows that the answer to the first question is that the primary rule must be interpreted as meaning that the concept of ‘hollow profile’, within the meaning of that rule, does not include a hot-formed ‘tube blank’, straight and of uniform wall thickness, which does not meet the requirements of a technical standard relating to hot-formed, seamless, stainless steel pipes and from which, by cold forming, pipes with a different cross-section and wall thickness are manufactured, under HS subheading 7304 41.

 The second question

50      The second question concerns the validity of the criterion relating to hollow profiles because of the exclusion from acquisition of origin of goods under HS subheading 7304 41 obtained cold from tubes and pipes under HS subheading 7304 49. However, that criterion is only one of two alternative criteria in the primary rule, both of which exclude an acquisition of origin of that kind for those goods.

51      Accordingly, it must be held that, by its second question, the referring court is asking the Court of Justice, in essence, to rule on the validity of the primary rule in the light of Article 290 TFEU, the principle of legal certainty and Article 60(2) of the Customs Code.

52      It should be noted, as a preliminary point, that, according to Article 62 of the Customs Code, the Commission is empowered to adopt delegated acts laying down rules according to which goods are deemed to have undergone their last, substantial, economically justified processing or working in an undertaking equipped for that purpose and resulting in the manufacture of a new product or representing an important stage of manufacture in a given country or territory, in accordance with Article 60 of that code. The purpose of those acts is to specify how the abstract criteria set out in that provision must be interpreted and applied in specific situations (see, to that effect, judgment of 20 May 2021, Renesola UK, C‑209/20, EU:C:2021:400, paragraph 33).

53      However, as also follows from settled case-law of the Court, exercise of that power of the Commission is subject to compliance with certain requirements (see, to that effect, judgment of 20 May 2021, Renesola UK, C‑209/20, EU:C:2021:400, paragraph 34). The objectives pursued by a delegated regulation must be such as to justify its adoption, that regulation must satisfy the requirement to state reasons imposed on such an act and the Commission’s assessments relating to the determination of the country of origin of the products to which that regulation is applicable must not be vitiated by an error of law or a manifest error of assessment in the light of Article 60(2) of the Customs Code (see, to that effect, judgment of 20 May 2021, Renesola UK, C‑209/20, EU:C:2021:400, paragraphs 40 and 42).

54      That origin must, in any event, be determined on the basis of the decisive criterion of the ‘last substantial processing or working’ of the goods concerned. That term must itself be understood as referring to the stage in the production process during which the use to which the goods are to be put is established, and they acquire specific properties and composition, which they did not possess previously, and which are not required to undergo significant qualitative changes subsequently (judgment of 20 May 2021, Renesola UK, C‑209/20, EU:C:2021:400, paragraph 38 and the case-law cited).

55      Judicial review as to whether a provision of an act such as Annex 22-01 to Delegated Regulation 2015/2446 is well founded may relate to whether, irrespective of any error of law, the Commission committed a manifest error of assessment in implementing Article 60(2) of the Customs Code, in view of the specific situation concerned (see, to that effect, judgment of 20 May 2021, Renesola UK, C‑209/20, EU:C:2021:400, paragraph 39 and the case-law cited).

56      It follows that, although the Commission has a discretion in applying the general criteria of Article 60(2) of the Customs Code to specific working and processing, it cannot, in the absence of objective justification, adopt entirely different solutions for similar working and processing operations (see, by analogy, judgment of 23 March 1983, Cousin and Others, 162/82, EU:C:1983:93, paragraph 21).

57      As regards the criterion of a change of tariff heading provided for in the primary rule, the Court has already held that it is not sufficient to seek criteria defining the origin of goods in the tariff classification of processed products, since the Common Customs Tariff was conceived to fulfil special purposes and not in relation to the determination of the origin of the products (see, to that effect, judgment of 11 February 2010, Hoesch Metals and Alloys, C‑373/08, EU:C:2010:68, paragraph 42 and the case-law cited).

58      Although it is correct that a change in the tariff heading of a product, caused by a processing operation, constitutes an indication of the substantial nature of that processing or working, the fact remains that processing or working may be substantial in nature even if there is no such change of heading. The criterion of a change of tariff heading covers a majority of situations, but does not make it possible to identify all situations in which the processing or working of the goods is substantial (see, to that effect, judgment of 11 February 2010, Hoesch Metals and Alloys, C‑373/08, EU:C:2010:68, paragraph 43 and the case-law cited).

59      Thus, for the purposes of conferring the origin of goods falling within HS subheading 7304 41, the primary rule lays down, in addition to the criterion of a change of tariff heading, the criterion of change from hollow profiles under subheading 7304 49 of that system, the purpose of which is to supplement and correct the first criterion (see, by analogy, judgment of 23 March 1983, Cousin and Others, 162/82, EU:C:1983:93, paragraph 17).

60      It should be noted, as the referring court has done, that the criterion relating to hollow profiles establishes a difference in treatment. Under that criterion, the cold forming of a product under HS subheading 7304 49, the inner and outer surfaces of which do not have the same form – which therefore constitutes a ‘hollow profile’ within the meaning of the Explanatory Notes to the HS relating to Chapter 73 – into a product of the same form but whose properties are different as a result of that type of forming, which therefore also constitutes a ‘hollow profile’ within the meaning of those notes, determines the origin of the finished product, the latter therefore being deemed to constitute the result of ‘substantial processing or working’ within the meaning of Article 60(2) of the Customs Code. By contrast, the cold forming of a product, also falling within HS subheading 7304 49 – consisting of a concentric hollow product whose inner and outer surfaces have the same form, which is therefore a ‘tube’ or ‘pipe’ within the meaning of the Explanatory Notes to the HS relating to Chapter 73 – into a product of the same form but whose properties are also different on account of that type of forming, which therefore constitutes another ‘tube or pipe’, within the meaning of those notes, does not determine the origin of the finished product. Thus, according to the criterion relating to hollow profiles, only the latter product is deemed not to be the result of substantial processing within the meaning of Article 60(2).

61      In so far as the Commission has not provided any convincing justification for objectively explaining that difference in treatment between tubes or pipes, on the one hand, and hollow profiles, on the other, all of which fall under HS subheading 7304 41 and were obtained from products falling under HS subheading 7304 49, it appears contradictory and discriminatory that the primary rule provides that cold forming may determine the origin of hollow profiles using an alternative criterion, whereas the same type of forming applied to pipes and tubes can determine their origin only by reference to a single, considerably stricter, criterion (see, by analogy, judgment of 23 March 1983, Cousin and Others, 162/82, EU:C:1983:93, paragraph 21).

62      That conclusion is confirmed by the finding in recital 33 of Implementing Regulation 2017/2093 that tubes and pipes undergo substantial transformation as a result of their cold forming. Indeed, that finding is based on the observation that cold forming brings irreversible changes to their physical, mechanical and metallurgical properties. Such changes are capable of determining the origin of a product, as is apparent from the case-law referred to in paragraph 54 above.

63      Furthermore, the assertion to the contrary made by the Commission in the present reference for a preliminary ruling, according to which cold forming does not alter the metallurgical properties of the tubes and pipes, is not based on any objectively verifiable basis and appears in any event to be contradicted by the statements contained in the second paragraph of point IV, B, of the general considerations of the Explanatory Notes to the HS relating to Chapter 72.

64      In those circumstances, it must be held that, in so far as it rules out the possibility that the change of tariff heading resulting from the transformation of tubes and pipes under HS subheading 7304 49 into seamless tubes, pipes and hollow profiles of iron or steel, cold-drawn or cold-rolled (cold reduced) under HS subheading 7304 41, confers on those products the status of products originating in the country where that change took place, the primary rule does not comply with the provisions of Article 60(2) of the Customs Code, with the result that, in adopting that rule, the Commission made a manifest error of assessment.

65      In that context, it must be concluded that the primary rule is invalid since it excludes given operations from conferring on a product the status of product originating in the country where those operations took place, whereas analogous operations determine the acquisition of origin for similar products (see, by analogy, judgment of 23 March 1983, Cousin and Others, 162/82, EU:C:1983:93, paragraphs 20 and 21).

66      It follows that the answer to the second question is that the primary rule is invalid since it excludes the change of tariff heading resulting from the transformation from tubes and pipes under HS subheading 7304 49 into seamless tubes, pipes and hollow profiles of iron or steel, cold-drawn or cold-rolled (cold reduced) under HS subheading 7304 41, from conferring on those products the status of products originating in the country where that change took place.

 The third question

67      The third question is based on the premiss that the primary rule is invalid, at least as regards the criterion of change from hollow profiles under HS subheading 7304 49. It is apparent from the answer to the second question that that criterion of that rule is invalid only in so far as it excludes from the determination of origin of a finished product under HS subheading 7304 41 the change from tubes and pipes of HS subheading 7304 49, which means that the primary rule is also applicable to such a change. Therefore, there is no need to answer the third question.

 Costs

68      Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Ninth Chamber) hereby rules:

1.      The primary rule applicable to goods falling under subheading 7304 41 of the Harmonised Commodity Description and Coding System, provided for in Annex 22-01 to Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015 supplementing Regulation (EU) No 952/2013 of the European Parliament and of the Council as regards detailed rules concerning certain provisions of the Union Customs Code, as amended by Commission Delegated Regulation (EU) 2018/1063 of 16 May 2018,

must be interpreted as meaning that the concept of ‘hollow profile’, within the meaning of that rule, does not include a hot-formed ‘tube blank’, straight and of uniform wall thickness, which does not meet the requirements of a technical standard relating to hot-formed, seamless, stainless steel pipes and from which, by cold forming, pipes with a different cross-section and wall thickness are manufactured, under subheading 7304 41 of the Harmonised Commodity Description and Coding System.

2.      The primary rule applicable to goods under subheading 7304 41 of the Harmonised Commodity Description and Coding System, provided for in Annex 22-01 to Delegated Regulation 2015/2446, as amended by Delegated Regulation 2018/1063, is invalid since it excludes the change of tariff heading resulting from the transformation from tubes and pipes under subheading 7304 49 of the Harmonised System into seamless tubes, pipes and hollow profiles of iron or steel, cold-drawn or cold-rolled (cold reduced) under subheading 7304 41 of that harmonised system, from conferring on those products the status of products originating in the country where that change took place.

[Signatures]

*      Language of the case: German.

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