Must Regulations Nos 1430/79 and 1575/80, taken together, be interpreted as having retroactive effect, and consequently as being applicable to the facts of this case?

If not, are there any general principles of Community law which preclude the application of a national equitable rule to the repayment of an amount obiectively not in fact due under Community law?

1.

In support of the view that the regulations in question should be applied retroactively, it may be argued that Regulation No 1575/80 is essentially a procedural measure since it lays down detailed rules for the implementation of Article 13 of Regulation No 1430/79, which permits infer alia the repayment of import duties on equitable grounds. As the Court recalled in the first sentence of paragraph 9 of its decision in the abovementioned Salumi judgment, “procedural rules are generally held to apply to all proceedings pending at the time when they enter into force”.

In this case, it is evident that Commission Regulation No 1575/6! cannot be viewed in isolation. Rather, it must be considered in conjunction with Council Regulation No 1430/79, which it enlarges upon in one respect. An analysis of Regulation No 1430/79 shows ihat it contains not only rules relating to time-limits (period of three years within which a claim for reimbursement may be submitted where the customs debt is fixed at an amount higher than that lawfully due) and rules relating to proof (required by Article 4 (a) in order to qualify for repayment or remission of import duties) but also substantive rules, for example the rules defining the facts which must exist if a tax or customs debt is to be repaid or remitted.

Procedural rules play a subordinate role in relation to substantive rules, as is in the nature of things and as is borne out in this case by the fact that the rules governing proof and time-limits are adapted to the different situations to which they applv. In that respect Regulation No 1430/79 displays the same features as Council Regulation No 1697/79, adopted less than a month later, on 24 July 1979, on the “post-clearance” recovery of export duties which have not yet been levied. Since both regulations are “composite measures”, it is necessary to disregard the presumption that the new rules of procedure are superior to the old ones, a presumption which would lead to the immediate application of the new rules to any circumstances which have not given rise to a final judgment.

Both the regulations under consideration have as their purpose to replace the corresponding provisions of national law, which varied as regards both substance and procedure, with a Community svstem designed to ensure that situations in which the reimbursement or repayment of import or export duties was justified were dealt with uniformly. That is particularly true in the case of the provisions of Regulation No 1430/79, especially the combined provisions of Article 1 (2) (c), which defines the term “repayment” (“the refund of import ... duties which have been paid”), and of Article 2 (1) (“Import duties shall be repaid in so far as the competent authorities are satisfied that the amount of such duties entered in the accounts ... exceeds for any reason the amount lawfully payable”). Those provisions would in any event have been applicable if the events in question had occurred after 1 July 1980.

Accordingly, the finding made by the Court in the Salumi judgment with regard to Regulation No 1697/79 may be applied to Regulation No 1430/79 and, consequently, to the regulation implementing it: “replacing the relevant national provisions with Community provisions, that regulation contains both procedural and substantive rules which form an indivisible whole and the individual provisions of which may not be considered in isolation, with regard to the time at which they take effect” (paragraph 11 of the decision).

2.

Thus, as in the case of Regulation No 1697/79, the provisions of Regulations Nos 1430/79 and 1575/80 “may not be accorded retroactive effect unless sufficientlv clear indications lead to such a conclusion” (first sentence of paragraph 12 of the decision). Once again, as in the case of Regulation No 1697/79, “far from indicating any retroactive effect, both the wording and the general scheme of [Regulation No 143C/79] lead to the conclusion that the regulation provides only for the future” (second sentence of paragraph 12 of the decision).

Admittedly, in this case it is not possible to apply the first argument to thai effect set out in the Salumi judgment. That argument was based on the “very wording of the provisions of the regulation, which impose either an obligation or a prohibition in relation to bringing proceedings for the recoven- of duty and which are therefore not designed to cover actions already commenced at the date of the entry into force of the regulation” (first sentence of paragraph 13 of the decision). Regulation No 1430/79 makes no provision for such actions. However, as the agent for the Commission emphasized at the hearing, Regulation No 1430/79 of 2 July 1979 entered into force on 1 July 1980, as did Regulation No 1697/79 of 24 July 1979. Accordingly, it may be said of the former regulation too that the time lapse “demonstrates that the Council did not consider the implementation of the Community rules to be urgent” (second sentence of paragraph 13 of the decision).

Furthermore, the application of Regulations Nos 1430/79 and 1575/80 to duties fixed before 1 July 1980 would create considerable legal uncertainty. As has been seen in this case, the period for reclaiming duties which should not have been paid has been fixed at three years (Article 2 (2) of Regulation No 1430/79).

In some Member States the periods prescribed by national law for lodging such claims may have been either shorter or longer. Thus the retroactive application of those regulations would lead to the following consequences:

The result would be “an uniustified difference in treatment with regard to transactions effected in similar circumstances” which “would be incompatible with the principles of equality and justice” (paragraph 14 of the decision).

For all those reasons, I am of the opinion that, in answer to the question submitted by the Finanzgericht Berlin, the Court should state in the first place that Regulations Nos 1430/79 and 1575/80 are inapplicable to customs duties overpaid before 1 July 19S0.

(a)

In general terms, the decisions of the Court indicate that rules of national law may be applied to situations involving a Community element where there are no relevant rules of Community law. In its judgment of 12 June 1980 in Case 130/79 Expreii Dam Foods [1980] ECR 1887. the Court stated that reference to national laws is “necessary” in such a case unquestionably in order to avoid a denial of lustice. The Court found that “in the regrettable absence of Community provisions harmonizing procedures and time-limits” it is not for the Court “to issue general rules of substance or procedural provisions which only the competent institutions may adopt”. In that case therefore, as in this case and in many others, there was a lacuna in Community law which could be filled only by reference to the laws of the Member States. The reservations which are apparent in the reasons given for the Court's solution may be explained by the fact that it entails, as a result of the differences between the relevant national laws, “differences in treatment on a Community scale” (paragraph 12 of the decision, at p. 1900).

(b)

For that reason the Court laid emphasis on the limits, based on the general principles of Community law, to be set to the application of national laws even in the absence of specific Community legislation.

The first of those limits, and the one on which the Hauptzollamt Berlin-Sud based its rejection of Reichelt's claim, falls within the scope of the principle that Communitv law must be uniformly applied in its entirety in all the Member States.

That is brought out by point 1 in the operative part of the Balkan judgment, which was concerned with the application of the provision corresponding to Article 227 of the Abgabenordnung :

“A national customs authority is not entitled to apply the provisions of us national law to an application for exemption, on grounds of natural justice, from charges due under Community law — in this instance, monetary compensatory amounts — in so tar as to apply national law would alter the effect of the Community rules relating to the basis of assessment, the manner of imposition or the amount of the charge in question.”

However, like the Finanzgericht, I doubt whether that principle can have been contravened in this case because of the differences between the facts on which the Balkan judgment was based and the situation in which Reichelt finds itself. In the Balkan case, as in the earlier Granaria case (judgment of 30 November 1972 in Case 18/72 [1972] ECR 1163), the charges at issue were indeed payable under Community law. Accordingly, to remit them on the basis of a national equitable rule would have constituted an arbitrary encroachment directly affecting the scope of Community law.

However, there is no question that Reichelt paid certain sums which ought not to have been levied if Community law had been correctly applied. In those circumstances the independent nature and the supremacy of Communio law do not preclude the application of a national equitable rule permitting the repayment of customs duties which were objectively excessive and which were collected before 1 July 1980.

(c)

However, the freedom of the national authorities is restricted by the principle based on the prohibition of discrimination, a principle recognized by the Court in several areas. In the case of claims founded on Community law, the application of national rules must not varv according to whether the claims are based on Community law or on national law alone. In the ludgment of 27 March 1980 in Case 61/79 (Denkavit [ 1983] ECR 1205;, in which the question arose of “the existence and scope of the duty of Member States which have levied national charges or dues which have subsequently been held to be incompatible with Community law to refund them at the request of the taxpayer” (paragraph 4 of the decision at p. 1220), the Court ruled that the procedural conditions governing actions for the recovery of such charges “cannot be less favourable than those relating to similar actions of a domestic nature” (paragraph 25 of the decision at p. 1226). It is clear that the above principle must apply, mutatis mutandis, to the repayment of customs duties which are likewise incompatible with Community law.

However, it is also necessary to prevent the national authorities from being tempted to show greater severity in relation to traders reclaiming customs duties, that is to say the Community's own resources, than they would in relation to national resources. Equality of treatment must be complete. Traders relying on Community law must not be treated either more restrictively or more leniently than those whose claims are based on national law.

(d)

The Finanzgericht Berlin mentions the possibility that the excessive dunmay be passed on to the customers of the person who paid it with the result that no loss is incurred by that person.

I shall merely recall the solutions arrived at bv the Court in its judgments of 27 February 1980 in Case 68/79 (Just [1980] ECR 501) and 27 March 1980 in Case 61/79 (Denkavit [1980] ECR 1205). In those two cases the Court's conclusion was that the protection of rights guaranteed by Community law did not require an order for the recoven of charges improperly made to be granted in conditions which would involve the unjust enrichment of those entitled, with the result that there was nothing, from the point of view of Community law, to prevent national courts from taking account in accordance with their national law of the fact that it had been possible for charges unduly levied to be incorporated in the prices of the undertaking liable for the charge and to be passed on to the purchasers (in the Just judgment, paragraph 26 of the decision at p. 523; in-the Denkavit judgment, paragraph 26 of the decision at p. 1226).

The question as to whether or not that principle is to be applied in relation to the plaintiff in this case is purely an issue of fact and can therefore be decided only by the Finanzgericht.

1.

Regulations Nos 1430/79 and 1575/80 do not apply to customs duties overpaid before 1 July 198C.

2.

Community law does not preclude the application of a rule of national law providing for the remission of charges on equitable grounds in the case of customs duties fixed at a rate objectively too high and collected before 1 July 198C. However, the conditions governing the remission of such duties on equitable grounds may not be more favourable than the conditions governing comparable claims for the repayment of charges imposed by national law.