Opinion of Mr Advocate General Reischl

Mr President,

Members of the Court,

The plaintiff in the main action imponed whisky from the United Kingdom into Italy from the year 1963 to 1974 (in the order making the reference the former date is given as 1956, which is clearly an error). Since whisky, in accordance with the Italian provisions, constituted spirits in the first category — spirits which are produced from materials other than wine, marc, waste from the production of wine and fruit — the frontier surcharge (sovimposta di confine) and the State tax [diritto erarile] were charged on it at the full rate, on the basis of the content of pure spirit.

The importer considers that taxation — at any rate in so far as it concerns imports after the accession of the United Kingdom to the European Economic Community — to be an infringement of Article 95 of the EEC Treaty because domestic products are to be regarded as similar or competing goods for the purposes of Article 95, were at that time liable only to lower duties, that is — in so far as distilled spirits from marc or from domestic wine are concerned — a frontier surcharge corresponding to the manufacturing tax at a reduced rate and no State tax at all, or — in so far as the products concerned were not those of the so-called second category, such as spirits produced from dates, raisins, figs, carob beans and other fruit and cenain products in the first category (spirits distilled from molasses, cane sugar and sorghum) — a State tax at a reduced rate.

Since the undertaking Cogis considered that imponed whisk\qualified for the same tax treatment as Italian spirits distilled trom wine, and in reliance on the case-law of this Coun on Article 95, it brought an action in 1976 for the refund ol the frontier surcharge and the State tax which in its view had been unlawfully imposed.

The court before which the action was brought considers ihat it must accept that, in the light of that case-law. there is a case of discrimination against the imponed products. Nevertheless, since it considers that the application of the principle laid down in the judgment in Case 169/78 on the one hand and in the judgment in Case 28/69 on the other produced different results it stayed the proceedings by order of 9 July 1981 and referred the following question for a preliminary ruling:

Has the Italian State, by applying to imports of whisky from the United Kingdom a system of taxation comprising the State tax which is not charged on domestic spirits distilled from wine and the frontier surcharge at the full rate, when the manufacturing duty on domestic spirits distilled from wine is payable at a reduced rate, infringed Article 95 of the Treaty?

My opinion on this question is as follows:

1. It is clear that the Coun cannot answer the question as it has been worded.

2. The first paragraph of Article 95 prohibits the imposition on the products of other Member States of any internal taxation in excess of that imposed on similar domestic products.

3. According to the second paragraph of Article 95, to which the order making the reference also has regard, it is, furthermore, not permissible to impose on products of other Member States internal taxation of such a nature as to afford indirect protection to other domestic products.

4. Even if, in view of the foregoing observations, there are in fact strong grounds for concluding that the Italian system of taxation — in so far as it is concerned, on the one hand, with the taxation of spirits distilled from cereals which are almost entirely imported and, on the other, with the taxation of spirits distilled from wine, a typical Italian product — is not in accordance with Article 95 it is however still necessary, before a final judgment is possible, to examine certain additional considerations which have been put forward by the Italian Government. The Italian Government referred to the fact that according to the case-law of the Court a differentiation in taxes and the application of reduced rates for certain types of products or classes of producers is permitted — as was emphasized in the judgment in Case 148/77, for legitimate economic or social purposes, such as encouraging the use of certain raw materials, favouring the production of particular spirits of high quality or the maintenance in business of certain undertakings. In this connection, according to more recent decisions (see the judgment in Case 140/79) the primary requirement is that objective criteria, such as the raw materials used or the production processes employed, should be applied and it is furthermore necessary to have regard only to the point whether the pursuit of certain objectives of economic policy is compatible with Community law.

5. In view of all the foregoing considerations the only answer which in my opinion can be given to the question put by the Tribunale di Milano is as follows:

1 Translated from the German.

2 Judgment of 27 February 1980 in Case 169/78 Commission v Italian Republic [1980] ECR 385

3 Judgment of 15 April 1978 in Case 28/69 Commissiion Italian Republic [1970] ECR 187.

4 Judgment of 15 April 1970 in Case 28/69 Commission v Italian Republic [1970] ECR 187.

5 Judgment of 17 February 1976 in Case 45/75 REWE-Zentrale des Lebensmittel-Großhandels GmbH v Hauptzollamt Landau-Pfal [1976] ECR 181.

6 Judgment of 27 February 1980 in Case 168/78 Commission v French Republic [1980] ECR 347.

7 Judgment of 27 February 1980 in Case 168/78 Commission v French Republic [1980] ECR 347.

8 Judgment of 27 February 1980 in Case 169/78 Commission v Italien Republic [1980] ECR 385.

9 Judgment of 27 February 1980 in Case 169/78 Commission v Italien Republic [1980] ECR 385.

10 Judgment of 27 February 1980 in Case 170/78 Commission v United Kingdom of Great Britain and Nortnem Ireland [1980] ECR 417.

11 Judgment of 27 February 1980 in Case 169/78 Commission v Italien Republic [1980] ECR 385.

12 Judgment of 27 February 1980 in Case 169/78 Commission v Italien Republic [1980] ECR 385.

13 Judgment of 27 February 1980 in Case 169/78 Commission v Italian in Republic [1980] ECR 385

14 Judgment of 27 February 1980 in Case 168/78 Commission v French Republic [1980] ECR 347.

15 Judgment of 27 February 1980 in Case 169/78 Commission v Italian in Republic [1980] ECR 385

16 Judgment of 27 February 1980 in Case 169/78 Commission v Italian in Republic [1980] ECR 385

17 Judgment of 27 February 1980 in Case 168/78 Commisson v French Republic [1980] ECR 347.

18 Judgment of 27 February 1980 in Case 68/79 Hans Just I/S v Minustry for Fiscal Affaire (1980) ECR 501.

19 Judgment of 27 February 1980 in Case 170/78 Commission v United Kingdom at Creat Bnuin and Sonhem Ireland [1980] ECR 417.

20 Judgment of 8 January 1980 in Case 21/79 Commission v Italian Republic [1980] ECR 1.

21 Judgment of 4 October 1979 in Case 28/79 La Providence Agricole de la Champagne v Council [1979] ECR 3091.

22 Judgment of 17 February 1976 in Case 45/75 REWE-Zentrale des Lebensmittel-Großhandels GmbH v Hauptzollamt Landau-Pfalz [1976] ECR 181.

23 Judgment of 12 October 1978 in Case 148/77 H. Hansen jun. & O. C. Balle GmbH & Co. v Hauptzollamt: Flensburg [1978] ECR 1787.

24 Judgment of 14. February 1981 in Case 140/79 — Chemial Farmaceutici SpA v DAF SpA [1981] ECR 1.

25 Judgment of 12 October 1978 in Case 148/77 H. Hansen jun & O. C. Baiie GmbH & Co. v Hauptzollamt Flensburg [1978] ECR 1787.

26 Judgment of 27 february 1982 in case 169/72 Commission v italian - Republic [1980] ECR 385

27 Judgment of 14 January 1981 in Case l48/79 Chemial Farmaceutici SpA v DAF SpA [1981] ECR 1

28 judgment of 14 Junuary 1981 in Case 46/82 Vinal v SpA Orbat [1981] ECR 77.