JUDGMENT OF 30. 9. 1982 — CASE 295/81 IFF / HAUPTZOLLAMT BAD REICHENHALL

In Case 295/81 REFERENCE to the Coun under Article 177 of the EEC Treaty by the Bundesfinanzhof [Federal Finance Coun], Federal Republic of Germany, for a preliminary ruling in the action pending before that coun between

THE COURT (Second Chamber) composed of: O. Due, President of Chamber, A. Chloros and F. Grévisse, Judges, Advocate General: Sir Gordon Slynn Registrar: H. A. Rühi, Principal Administrator

gives the following

JUDGMENT

Facts and Issues

I — Facts and procedure

II — Written observations submitted pursuant to Article 22 of the Protocol on the Statute of the Court of Justice of the EEC

III — Answers to the questions put by the Court

IV — Oral procedure

Decision

Costs

I —. Facts and procedure

1. Do the markets for fruit juice concentrates on the one hand and for flavour concentrates on the other, in the form in which those P rod u as are imported, constitute a single market or two separate markets, one for each of the products?

2. (a) What is the precise process whereby the two substances (the concentrate and the corresponding flavour concentrates) are separated? (b) What is the process whereby those substances are subsequently mixed in order to reconstitute non-concentrated fruit juice?

3. Why is it necessary to separate the flavour concentrates from the fruit juice concentrates? What losses are avoided by mat separation?

4. Can the Commission confirm that the two components (iuice concentrates and flavour concentrates) are dealt in and sold together

II —. Written observations submitted pursuant to Article 22 of the Protocol on the Statute of the Court of Justice of the EEC

1. According to the plaintiff in the main proceedings, General Rule 2 for the Interpretation of the Nomenclature of the Common Customs Tariff attributes decisive importance to the concept of article. It points out that the rule deals with articles which must be mentioned, incomplete or unfinished, in a specific heading of the tariff provided that they have as imported, ... the essential character of the complete or finished aniele (first sentence of General Rule 2 (a) for the Interpretation of the Nomenclature of the Common Customs Tarif0- In that context, the concept of article is therefore universal, and is not subject to any limitation, in any form whatever, and all blanks of articles are covered. It points out that that fact is also properly stressed in the Explanatory Notes to the Customs Cooperation Council Nomenclature (hereinafter referred to as the Explanatory Notes) in respect of General Rule 2 (a). Any limitation of that provision to specific goods is expressly avoided and therefore all the articles in Sections 1 to XXI are covered by the concept of article in the first sentence in General Rule 2 (a) for the Interpretation of the Nomenclature of the Common Customs Tariff. That universal definition of article laid down in the first sentence of General Rule 2 (a) for the Interpretation of the Nomenclature of the Common Customs Tariff thus also covers liquids. That wide view of the concept of aniele is supported by the opinion of the Commission and of the Advocate General in Case 165/78 IMCO-Michaelis (judgment of the Court ot Justice of 29 May 1979, [1979] ECR 1837). In that regard, the plaintiff in the main proceedings observes thai there has been support for the view that prior to the introduction of General Rule 2 (a) wich was adopted on 1 January 1972. a provision of the same kind existed only with respect to the articles in Sections XVI and XVII ot the Common Customs Tariff and that the latter rule was extended, by the adoption of General Rule 2 (a) for the Interpretation of the Nomenclature of the Common Customs Tariff, to all the goods in that tariff.

2. The Commission of the European Communities points out that if, in defining the concept of an article imported unassembled or disassembled (zerlegt gestellte Ware), reliance is placed primarily on the literal meaning that the expression would have for a reader without preconceived ideas, it is totally inappropriate, in the case, for example of an article involving two parts, to speak of an article imported unassembled or disassembled, unless it is still possible to identify the parts of the assembled article (after assembly as well as before).

III —. Answers to the questions put by the Court

IV —. Oral procedure

1. By order of 20 October 1981, received at the Court Registry on 25 November 1981, the Bundesfinanzhof [Federal Finance Court] referred to the Court of Justice for a preliminar) ruling, pursuant to Article 177 of the EEC Treaty, a question as to the scope of the second sentence of Rule 2 (a) of the General Rules for the Interpretation of the Nomenclature of the Common Customs Tariff (Official Journal 1974, L 1, p. 11 of 1 January 1974) with a view to the tariff classification of concentrates of mahalebcherry and black-currant juices and of the flavour concentrates thereof, which were imported from Yugoslavia in 1974 and 1975 by the appellant on a point of law in the main proceedings and which, according to the latter, were intended to be mixed in order to be marketed as mahaleb-cherry juice or black-currant juice.

2. The Hauptzollamt [Principal Customs Office) Bad Reichenhall dismissed the objection against the classification made by the Schwarzbach-Autobahn customs office and definitively classified the fruit-juice concentrates in subheading 20.07 A III (a) (rate of duty 42%) and the flavour concentrates in subheading 33.04 (rate of duty 8%).

3. Rule 2 (a) of the General Rules for the Interpretation of the Nomenclature of the Common Customs Tariff provides that Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished provided that, as imported, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also be taken to include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this Rule), imported unassembled or disassembled.

4. The dispute centres on the question whether the fruit-juice concentrates and flavour concentrates in question must be regarded as articles imported unassembled or disassembled as provided for in the abovementioned general rule for interpretation. If that were the case, the fruit-juice concentrates and flavour concentrates would have to be classified in subheading 20.07 B II (a) 6 (aa) (mahaleb-cherry juice) or (bb) (blackcurrant juice), the result of which would be to make the applicable rates 17% and 18% respectively.

5. In order to resolve this problem, the Bundesfinanzhof referred the following question to the Court for a preliminary ruling:

6. It is necessary therefore to consider whether the fruit-juice concentrates and flavour concentrates in question must, when produced to the customs authorities, be regarded as products which are unassembled or disassembled within the meaning of General Rule 2 (a).

7. In that regard, it seems conceivable that the expression used in the German version of the text in question, zerlegt gestellt wird, can apply to the separation or to the mixing of the constituents of a liquid.

8. The other language versions of the same text appear however to be more restrictive. The French text uses the words “l'état démonté ou non monté, the Italian version the words smontato o non montato and the English version refers to an unassembled or disassembled aniele. The Dutch, Danish and Greek versions express the same meaning as the French, Italian and English texts.

9. In these circumstances, the German version must be read in the light of the other language versions.

10. In ordinary language, the concept of assembly is taken to mean the operation whereby the components (of a mechanism, a device or a complex object) are assembled in order to render it serviceable or to make it function.

11. The essential requirement is therefore, on the one hand, that the disassembled article must not be usable for the purposes expected of the finished product and. on the other hand, that the component parts of the product must normally, in order to be of use, be assembled so as to constituie the finished product.

12. It is apparent from the file on the case that the products in question, fruit-ĮUice concentrates and flavour concentrates, have diverse uses in the form in which they are imponed and may be marketed separately; mixing them is merely one possibility

13. As a result, for the purposes of tariff classification at the time of importation, it is wholly unnecessary to consider the possibility that the liquids may be mixed or assembled when such a procedure is neither necessary nor clearly certain to take place.

14. That interpretation is moreover confirmed by paragraph VI of the Explanatory Notes to the Customs Cooperation Council Nomenclature, according to which anieles whose various components are intended to be assembled either by simple means (nuts, bolu and the like) or, for example, by riveting or welding, must be regarded as unassembled or disassembled.

15. Moreover, according to paragraph VII of those Notes, the contested rule does not generally apply to the products in Sections I to VI (Chapters 1 to 38 of the Common Customs Tariff).

16. It is therefore appropriate to state in reply to the national court that the second sentence of Rule 2 (a) of the General Rules for the Interpretation of the Nomenclature of the Common Customs Tariff must be interpreted as meaning that mahaleb-cherry concentrate and blackcurrant concentrate, on the one hand, and, on the other, mahaleb-cherry and blackcurrant flavour concentrates, extracted from those fruits, may not be regarded as articles imported unassembled or disassembled, even where the fruit-juice concentrates and the flavour concentrates, which are sold at the same price, are mixed immediately before use or bottling.

17. The costs incurred by the Commission of the European Communities, which has 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 proceedings pending before the national court, the decision on costs is a matter for that court.

On those grounds, THE COURT (Second Chamber) in answer to the question referred to it by the Bundesfinanzhof, by order of 20 October 1981, hereby rules: