Opinion of Mr Advocate General Capotorti

Mr President,

Members of the Court,

1. The two procedures for a preliminary ruling in respect of which this opinion is given raise identical problems concerning the interpretation of Article 95 of the EEC Treaty, that is to say, of the well-known prohibition of internal taxation of a discriminatory nature.

2. It was necessary in my opinion to recapitulate in some detail this longstanding quarrel between the Commission and the Italian Government on the central problem in the present case also because the significance of the attitude initially adopted by the Commission is still a matter of dispute. I have referred to a quarrel which was both long, having lasted 13 years (!) and, I may add, inconclusive, since the Commission has taken no action on the basis of Article 169 to ensure compliance with its reasoned opinion of 31 July 1978. At national level, on the other hand, as I have already mentioned, the two actions brought by Essevi SpA and the firm of Salengo were begun in 1976 and 1977 and, after judgment at first instance by the Tribunale, Milan, given in favour of the plaintiffs, the appeal stage has now been reached in connexion with which the present proceedings have arisen. There is however another factor to which I should refer. Pending the hearing of the appeal, the Italian Corte di Cassazione [Court of Cassation], composed of members from all its divisions, delivered two judgments, Nos 1317 and 1321 of 1 March 1979, in actions having the same subject-matter as those before the Corte d'Appello, Milan, in which it held, inter alia, that in regard to imports under the EEC arrangements for spirits distilled from wine, at least prior to the opinion delivered by the Commission of the European Communities on 28 February 1969, differential taxation resulting from the imposition of the State tax at the rate of LIT 60000 per hectolitre of pure alcohol does not enter into the calculation of the fiscal costs of the imported product. In support of that statement, the Corte di Cassazione pointed out that in the opinion of 28 February 1969 addressed to the Italian Republic pursuant to Article 169 of the EEC Treaty, the Commission expressly recognized Italy's right to use the tax as an instrument of its agricultural policy in the spirits sector and to maintain provisionally in that sector differential taxation at the rate of LIT 60000 per hectolitre of pure alcohol. The Corte di Cassazione also observed that the compatibility of a State aid with the common market may not be denied by a national court when not only has there not been any declaration to the contrary by the Commission but the latter has, moreover, expressly recognized the measure as compatible with the Treaty.

3. The first question of the two which the Court has been requested to answer is worded as follows: First, what is the effect to be attributed to the aforesaid opinions delivered by the Commission under Article 169 of the Treaty establishing the EEC; then whether, by applying to potable spirits distilled from wine and imported from other Member States a system of taxation including the State tax of LIT 60000 per hectolitre of pure alcohol (LIT 90000 as from March 1976), which is not provided for in the case of similar domestic products and is not charged thereon, Italy has infringed Article 95 of the EEC Treaty.

4. The second part of the first question is formulated in a manner which inconsistent with the function of proceedings for an interpretation by way of a preliminary ruling. The national court cannot expect this Court to decide, on the basis of Article 177, a specific case of an alleged infringement of the Treaty by a Member State. However, as on many other occasions, the question may be understood in general terms. On that basis, it will be necessary to establish whether or not the application by a Member State to potable spirits imported from other Member States of a system of taxation involving a fiscal burden which is not provided for in the case of corresponding domestic products and is not charged thereon is compatible with Article 95.

5. In its second question, the Corte d'Appello, Milan, asks the Court to determine whether, after the commencement of the second stage referred to in the third paragraph of Article 95 as being the final date for the abolition of national rules conflicting with the principle of equal tax treatment laid down in the first and second paragraphs of the said article, it is permissible by way of exception for Italy to continue a pre-existing discrimination in respect of the importation of potable spirits distilled from wine.

6. For all those reasons, I propose that the Court should rule as follows on the problems raised in the preliminary questions submitted to it by the Corte d'Appello, Milan:

1 Translated from the Italian.