Keywords
Summary

Keywords

Community law - Direct effect - National charges incompatible with Community law - Repayment - Procedures - Application of national law - Limitation periods - Whether permissible - Conditions - Observance of the principle of effectiveness of Community law - Observance of the principle of equivalence of conditions for actions for recovery with those for similar claims under domestic law

Summary

$$In the absence of Community rules on reimbursement of national charges levied though not due, it is for the domestic legal system of each Member State to designate the courts and tribunals having jurisdiction and to determine the procedural conditions governing legal proceedings for safeguarding rights which individuals derive from the direct effect of Community law, it being understood that such rules cannot be less favourable than those governing similar actions of a domestic nature (principle of equivalence), and may not make it impossible or excessively difficult in practice to exercise rights which national courts have a duty to protect (principle of effectiveness).

First, as regards the principle of effectiveness, the establishment of reasonable limitation periods for bringing proceedings satisfies that requirement in principle inasmuch as it constitutes an application of the fundamental principle of legal certainty. Such limitation periods cannot be regarded as rendering virtually impossible or excessively difficult the exercise of rights conferred by Community law, even if the expiry of those periods necessarily entails the dismissal, in whole or in part, of the action brought. In that respect, a national limitation period of up to a minimum of 4 years and a maximum of 5 years preceding the year of the judicial decision finding the rule of national law establishing the tax to be incompatible with a superior rule of law must be considered reasonable.

Secondly, observance of the principle of equivalence implies that the national procedure applies without distinction to actions alleging infringements of Community law and to those alleging infringements of national law, with respect to the same kind of charges or dues That principle cannot, however, be interpreted as obliging a Member State to extend its most favourable rules of limitation to all actions for repayment of charges or dues levied in breach of Community law. Thus, Community law does not in principle preclude the legislation of a Member State from laying down, alongside a limitation period applicable under the ordinary law to actions between private individuals for the recovery of sums paid but not due, special detailed rules, which are less favourable, governing claims and legal proceedings to challenge the imposition of charges and other levies. The position would be different only if those detailed rules applied solely to actions based on Community law for the repayment of such charges or levies.

It follows that Community law does not preclude legislation of a Member State laying down that, in tax matters, an action for recovery of a sum paid but not due based on a finding by a national or Community court that a national rule is not compatible with a superior rule of national law or with a Community rule of law may only relate to the period following 1 January of the fourth year preceding that of the judgment establishing such incompatibility.

( see paras 20-24, 29-30, 37 and operative part )