C-290/01

OPINION OF ADVOCATE GENERAL  JACOBS delivered on 10 April 2003 (1) Case C-290/01 Receveur principal des Douanes françaises de Villepinte v Derudder & Cie SA 1.        In this case the French Cour de Cassation (Commercial, Financial and Economic Division) has asked the Court for guidance on the interpretation of Article 70(1) of the Community Customs Code. (2) 2.        The question which has arisen is essentially whether, where the customs authority takes samples of imported goods in the presence of the declarant, (3) who does not at that time challenge the representativeness of those samples, and the customs authority seeks payment of additional import duties on the basis of its analysis of the samples, the declarant may challenge the validity of the order to pay the additional duties on the ground that the samples were not representative.  The relevant Community legislation  Verification of imported goods by the customs authority 3.        Although the national court refers in its question to the Customs Code, the facts occurred before that legislation came into force. (4)  Instead, Council Directive 79/695/EEC (5) and Commission Directive 82/57/EEC (6) were at the time in force. 4.        Article 2 of Directive 79/695 provides: ‘The release for free circulation of [goods imported into the Community] shall be conditional upon the lodging at a customs office, in accordance with the conditions laid down in this Directive, of an entry form for release for free circulation, hereinafter referred to as “the entry”. The natural or legal person who makes the entry shall hereinafter be referred to as “the declarant”.’ 5.        Article 9 of Directive 79/695 provides in so far as relevant: ‘1.      Without prejudice to any other means of control at its disposal, the customs authority may examine all or part of the goods entered. … 4.      The declarant shall be entitled to be present at the examination of the goods or to be represented at it.  If the customs authority sees fit, it may require the declarant to be present at the examination of the goods or to be represented at it in order to assist with the examination, as necessary. 5.      When examining the goods, the customs authority may take samples for analysis or for more detailed examination.  The costs arising from such analysis or more detailed examination shall be borne by the administrative authority.’ 6.        Article 10 of Directive 79/695 provides in so far as relevant: ‘1.      The results of the examination of the entry and the documents attached to it, whether or not combined with examination of the goods, shall be used for calculating the import duties and for applying any other provisions governing the release of goods for free circulation.  … 2.      Paragraph 1 shall be without prejudice to either any subsequent verification by the competent authorities of the Member State in which the goods have been released for free circulation or the possible consequences of applying the provisions in force, particularly as regards any change in the amount of import duty charged on those goods.’ 7.        Directive 82/57 implements certain provisions of Directive 79/695 including Article 9(1), (4) and (5). (7)  Article 11 of Directive 82/57 provides: ‘1.      Where it decides to examine a part of the goods only, the customs authority shall inform the declarant or his representative which items it wishes to examine. The authority’s choice shall be final. The findings of such partial examination shall apply to all goods covered by the entry in question. However, the declarant may request a further examination should he consider that the findings of the partial examination are not valid for the remainder of the goods declared.’ 8.        Article 12 of Directive 82/57 provides: ‘1.      Where the customs authority elects to examine goods it shall so inform the declarant or his representative. 2.      The declarant or the person designated by him to be present at the examination of the goods shall provide the customs authority with the assistance required to facilitate its work.  …’ 9.        Article 13(1) and (2) of Directive 82/57 provides: ‘1.      Where the customs authority decides to take samples, it shall so inform the declarant or his representative. Should it consider this desirable, the customs authority may require the declarant to be present at the taking of samples, or to arrange to be represented by a person able to tender the authority the necessary assistance. 2.       Samples shall be taken by the customs authority, which may, however, ask that this be done under its supervision by the declarant or a person designated by him. Samples shall be taken in accordance with the methods laid down in the provisions in force.’ 10.      Article 14(1) of Directive 82/57 provides: ‘The declarant or the person designated by him to be present at the taking of samples shall render to the customs authority all the assistance needed to facilitate the operation.’ 11.      The first paragraph of Article 15 of Directive 82/57 provides: ‘Where the customs authority takes samples for analysis or more detailed examination, it shall authorise the release of the goods in question without waiting for the results of the analysis or examination, unless there are other grounds for not doing so.’ 12.      Even though the Customs Code was not applicable at the time of the facts giving rise to the main proceedings, it is useful to set out the analogous provisions since several of those submitting observations refer to them. 13.      Article 4 of the Code lays down the following definitions: ‘(16) “Customs procedure” means: (a)      release for free circulation; … (17)      “Customs declaration” means the act whereby a person indicates in the prescribed form and manner a wish to place goods under a given customs procedure. (18)      “Declarant” means the person making the customs declaration in his own name or the person in whose name a customs declaration is made.’ 14.      Article 68(b) of the Code provides: ‘For the verification of declarations which they have accepted, the customs authorities may … examine the goods and take samples for analysis or for detailed examination.’ 15.      Article 69(2) provides: ‘The declarant shall be entitled to be present when the goods are examined and when samples are taken.  Where they deem it appropriate, the customs authorities shall require the declarant to be present or represented when the goods are examined or samples are taken in order to provide them with the assistance necessary to facilitate such examination or taking of samples.’ 16.      Article 70(1) provides: ‘Where only part of the goods covered by a declaration are examined, the results of the partial examination shall be taken to apply to all the goods covered by that declaration. However, the declarant may request a further examination of the goods if he considers that the results of the partial examination are not valid as regards the remainder of the goods declared.’ 17.      The first paragraph of Article 243(1) of the Code provides: ‘Any person shall have the right to appeal against decisions taken by the customs authorities which relate to the application of customs legislation, and which concern him directly and individually.’ 18.      Regulation No 2454/93 (8) implements Regulation 2913/92 establishing the Customs Code. 19.      Article 240 of Regulation No 2454/93 provides: ‘1.      Where the customs authorities elect to examine goods they shall so inform the declarant or his representative. 2.      Where they decide to examine a part of the goods only, the customs authorities shall inform the declarant or his representative which items they wish to examine.  The custom authorities’ choice shall be final.’ 20.      Article 242 provides: ‘1.      Where the customs authorities decide to take samples, they shall so inform the declarant or his representative. 2.      … Samples shall be taken in accordance with the methods laid down by the provisions in force. …’ 21.      Article 243(1) provides: ‘The declarant or the person designated by him to be present at the taking of samples shall render the customs authorities all the assistance needed to facilitate the operation.’    Import duties on rice 22.      At the relevant time, Community import duties on rice were governed by Regulation No 1418/76. (9)  It is common ground that the duty on broken rice is lower than that on whole-grain rice. (10) 23.      ‘Broken rice’ is defined in point 3 of Annex A to Regulation No 1418/76 as ‘grain fragments the length of which does not exceed three quarters of the average length of the whole grain’.  Grain measurements are to be taken on the basis of ‘a representative sample from the consignment’. (11) 24.      In Van Sillevoldt (12) the Court ruled that, for the purpose of determining the average length of the whole grain within the meaning of point 3 of Annex A, it was necessary to consider the average length of the whole grains in a sample from the consignment of imported rice, without taking account of the grains which were not fully developed. 25.      Article 2(2) of Regulation No 2729/75 (13) provides that the import duty applicable to mixtures composed of rice classifiable under one or more different processing groups or stages and of broken rice is to be that applicable to the component predominating by weight where that component represents at least 90% of the weight of the mixture.  Where neither component accounts for 90%, the higher duty applies.    The facts and the question referred 26.      In 1989 Tang Frères (‘Tang’) imported a consignment of ‘Thai flagrant [sic] broken rice’.  The rice was imported in several containers, each containing some 800 sacks of 25 to 30 kg.  Derudder & Cie SA (‘Derudder’) carried out the customs formalities on behalf of Tang.  On the entry form for release for free circulation Derudder described the goods as ‘broken rice’. 27.      At the time of import, the customs authority took six samples of the rice in the presence of a representative of Derudder. (14)  It is assumed by the referring court (although not apparently common ground between the parties) that at the time Derudder did not dispute the representativeness of the samples taken.  Since Derudder had indicated that it wished to market the rice, the customs authority ordered it to be released into circulation immediately after the samples had been taken. 28.      After analysis of the samples taken, the customs authority concluded that the mixture in question did not contain at least 90% broken rice and that, accordingly, the rate applicable was the rate for whole-grain rice.  The Collector of Customs and Excise (‘the Collector’) served on Derudder on 25 May 1992 an order to pay the additional import duties.  Derudder sought annulment of the order to pay before the Tribunal d’instance (District Court), Bobigny, on a number of grounds, including that the method used by the customs authority in analysing the samples was flawed and that the samples were not representative. 29.      In April 1993 the Tribunal d’instance ruled that, in order to determine the average length of whole grains of rice within the meaning of point 3 of Annex A to Regulation No 1418/76, it was necessary to consider the average length of the whole grains of rice contained in a sample from the consignment of imported rice, without taking account of grains which were not fully developed.  Before granting Derudder’s application, the Tribunal d’instance ordered an expert’s report for the purpose of (i) analysing one of the samples taken in order to determine the average length of the whole-grain rice on the basis of that method and (ii) determining whether broken rice represented 90% of the goods. 30.      The expert presented his report in October 1994.  He found that the proportions of broken rice in the six samples submitted to him was between 59.3% and 77% and therefore, as the customs’ analysis had concluded, significantly less than 90%.  However, he expressed reservations as to both the method of analysis and the representativeness of the samples.  With regard to the method of analysis, he stated in particular that it was technically impossible to disregard grains which were not fully developed, since there was no way of distinguishing such grains from mature grains.  With regard to the representativeness of the sample, the expert concluded that he had no evidence that the samples taken by the customs were representative of the goods as a whole.  He stated in particular that there had been no plan for statistical sampling:  the sample for each container had been taken from only one of approximately 800 sacks in the container, and that sack had been at the very front of the container.  The results of the analysis were accordingly in the expert’s view valid only for the sample itself and could not be extrapolated to determine the real proportion of broken rice in the container as a whole. 31.      At the hearing in March 1996 Derudder submitted that the customs authority had not demonstrated that duty at the higher rate was payable;  that the samples taken were not representative with the result that it was not possible to determine whether the broken rice represented 90% of the total or, consequently, to apply the rate applicable to whole grain rice;  that the distinction between mature and immature grains proposed by the Court of Justice was, according to the expert, technically impossible to draw and that the analyses made by the customs authority could accordingly not be used as evidence, so that the authority could not assert that the relevant rate of duty was that applicable to whole-grain rice. 32.      The Collector asked the Tribunal d’instance to annul the expert’s report in part on the ground that the expert had exceeded his remit in pronouncing on points not referred to his expertise, namely the validity of the sampling methods proposed by the Court of Justice and the representativeness of the samples, which had been taken in the presence of Derudder. 33.      In May 1996 the Tribunal d’instance annulled the contested order to pay, stating that the presence of the declarant when samples were taken neither entailed that those samples were representative nor precluded the declarant from subsequently challenging the representativeness and that the expert had not found the samples to be representative. 34.      The Collector unsuccessfully appealed against that decision to the Cour d’appel (Court of Appeal), Paris, advancing the same arguments as those put forward before the Tribunal d’instance. 35.      The Cour de Cassation, hearing the Collector’s further appeal on a point of law, has stayed the proceedings and referred to the Court for a preliminary ruling the question whether on a proper construction of Article 70(1) of the Community Customs Code a declarant who was present when the customs authority took samples of the goods entered but did not then challenge the representativeness of that sample may subsequently seek annulment of the order to pay the additional duties on the ground that the samples were not representative. 36.      Written observations have been submitted by Tang, which has taken over the conduct of the proceedings from Derudder, the French and Italian Governments and the Commission.  The French Government and the Commission were represented at the hearing.    Analysis 37.      All those submitting observations consider that a declarant who was present when samples were taken and did not then object is not precluded from subsequently challenging the representativeness of those samples. 38.      Tang, which restricts its analysis to the Community Customs Code, appears to consider that the declarant remains so entitled even after the goods in question have been released for free circulation and consumed.  The French Government and the Commission in contrast consider that the declarant is entitled to dispute the representativeness of samples taken only for as long as the goods remain available for further sampling, while the Italian Government submits that the entitlement is extinguished by the declarant’s acceptance of the assessment of customs duties. 39.      The parties are divided in particular over the applicability of Article 11 of Directive 82/57, which permits the declarant to request a further examination of partially examined goods should he consider that the results of the partial examination are not valid for the remainder of the goods, and hence by implication (it is suggested) validates the results of such examination unless the declarant requests a further examination.  Tang submits that Article 70(1) of the Code – which essentially repeats Article 11 of Directive 82/57 – applies only to the partial examination of goods and not to the taking of samples.  In contrast the French Government and the Commission explicitly submit, and the Italian Government appears to assume, that partial examination comprises the taking of samples. 40.      Although the legislation is not entirely clear, I consider that Tang’s view (expressed in the context of the Code) is more consistent with the structure of Directive 82/57.  Article 11 appears in Title II of that directive, headed ‘Verification of the entry form’.  Title II is divided into four sections, headed ‘A.  Documentary verification’, ‘B.  Examination of the goods’, ‘C.  Taking of samples’ and ‘D.  Attestation by the customs authority’.  Section B comprises Articles 11 and 12;  Section C comprises Articles 13 to 17.  That structure suggests that the concepts of examination of the goods on the one hand and the taking of samples on the other were intended to be governed by different provisions.  Partial examination on that interpretation does not encompass the taking of samples of, for example, goods such as those at issue in the main proceedings, the import duty on which may vary depending on their precise composition.  It means rather the examination of part of a consignment of identical goods in order to determine the correct customs classification of such goods and in particular to verify that the goods have been correctly declared.  That is strongly suggested by the wording of Article 11, which refers to the ‘items [which the customs authority] wishes to examine’. 41.      The legislation however is not unambiguous.  Directive 82/57, it must be remembered, is an implementing measure;  it implements various provisions of Directive 79/695 including Article 9(1), (4) and (5) and Article 10(1).  It is clear from Article 9(5) of Directive 79/695 that the taking of samples is a particular form of examination of the goods.  That is confirmed by Article 10(1) of that directive, which makes no separate mention of samples but clearly envisages that the ‘examination of goods’ includes any taking of samples. 42.      The Customs Code, which replaced Directives 82/57 and 79/695, is similarly not unambiguous and could be taken either way.  On the one hand it could be argued that, since Article 70 of the Code, unlike Articles 68 and 69, refers to examination, and in particular partial examination, alone, rather than to both examination and the taking of samples, Article 70 does not apply to the taking of samples.  On the other hand, it could be argued from the scheme and language of Articles 68(b) and 69(2) that the reference in Article 70(1) to the examination of part of the goods covered by a declaration includes the examination of samples of those goods. 43.      The wording of the legislation at issue does not therefore conclusively answer the question whether Article 11 of Directive 82/57 applies to the taking of samples.  In any event, however, that provision does not to my mind resolve the question put by the Cour de Cassation since it merely permits the declarant to request a further examination without specifying for how long that option remains available.  The answer to the question referred flows rather from the scheme and objectives of the legislation. 44.      It is clear from the preamble to Directive 79/695 – which directive, as noted above, is implemented by Directive 82/57 – that it sought to ‘fix common rules of procedure for the release of goods for free circulation’ and that those common rules ‘must make it possible to ensure the correct application not only of customs duties, charges having equivalent effect, agricultural levies or other charges laid down within the framework of the common agricultural policy, but also of any other Community provisions governing the release of goods for free circulation; … such rules … must be sufficiently flexible to adapt to differing circumstances’. (15) 45.      Directive 82/57 was intended to ‘ensure uniform application of [those] common rules’ (16) and ‘to establish practical, uniform procedures for … the examination of goods and taking of samples’. (17) 46.      It will clearly further those objectives if a declarant is entitled to challenge a sample of imported goods on the basis that it is not representative and hence would not lead to the imposition of the correct duties on those goods.  The taking of a further sample in such circumstances will contribute to the correct application of customs duties.  On that basis, I see no reason to prohibit such a challenge merely because the declarant was present when the sample was taken. 47.      Moreover the right to challenge decisions taken by an authority is a general principle which must be read broadly, currently enshrined in the customs context in Article 243(1) of the Code. (18)  It underlies both Article 11 and the other provisions. 48.      However, it must be borne in mind that Article 15 of Directive 82/57 provides that, where the customs authority takes samples for analysis or more detailed examination, it is in general to authorise the release of the goods in question without waiting for the results of the analysis or examination.  Where the goods in question have been released for free circulation and are no longer available to the customs authority, the situation is manifestly different from that envisaged in the preceding paragraphs.  In such a case, if a declarant were able to contest the representativeness of samples taken there would be no possibility of taking further samples and the declarant could avoid paying any additional duty demanded by the customs authority on the basis of the original samples.  That, as the French Government and the Commission suggest, would preclude the correct application of customs duties and hence run counter to the objectives of the legislation. 49.      For that reason it will normally be in the declarant’s interest to ensure that the samples initially taken are representative so that the goods may be released for free circulation.  If the customs authority decides to take samples, it is required to inform the declarant, (19) who is required to give the authority all the assistance needed to facilitate the operation. (20)  The declarant is thus in a position to ensure that the samples initially taken are representative of the consignment as a whole. 50.      Accordingly in my view the declarant’s entitlement to challenge the representativeness of samples taken from a consignment of imported goods lapses once those goods are no longer available for the taking of further samples. 51.      Tang objects to that interpretation on the ground that the declarant cannot logically request a further examination before the results of the examination of the samples are known, by which time the goods will have been released for free circulation and may no longer be available. 52.      That objection does not in my view preclude the interpretation I have proposed.  Where samples are taken, there are two grounds on which the results may be open to challenge (both of which in fact are at issue in the main proceedings in the present case, but only one of which is mentioned in the question referred). 53.      First, the declarant may be dissatisfied with the method of analysis of the samples.  Clearly he will not be in a position to reach a view on that method until the analysis has been completed and the results known.  However, in that case it will still normally be possible to carry out a further examination even after the consignment of goods in question has been released for free circulation:  Article 17 of Directive 82/57 (21) provides for the customs authority (i) to retain the samples (unless they have been destroyed by the analysis) until all the declarant’s means of appeal against the authority’s decision on the basis of the results of the analysis have been exhausted and (ii) to return them to the declarant thereafter.  Thus it should in principle be possible to repeat the analysis. 54.      Second, the declarant may be dissatisfied with the representativeness of the samples.  In that case, as indicated above, it would frustrate the overall objective of the legislation if he remained entitled to contest the representativeness when the goods were no longer available for further samples to be taken. 55.      Once the goods in question have been released for free circulation, they will not necessarily – or even normally – be so available.  Article 13(3) of Directive 79/695 provides that until released for free circulation ‘goods may not be moved from where they are, or handled in any way whatsoever, without the authorisation of the customs authority’. (22)  Thus until that point further samples may be taken in the certainty that the goods available are those originally imported and sampled. 56.      Once the goods have been released for free circulation, however, the goods normally cease to be under the control of the customs authorities.  The declarant may claim that the entire consignment of imported goods remains intact;  he must however be in a position to prove it if he wishes to challenge the representativeness of samples previously taken.  If he can demonstrate unequivocally that the entire consignment of goods released for free circulation has in fact remained intact and unaffected in any material respect despite the ensuing handling, transport or storage of the goods, I see no ground for preventing his challenging the representativeness of such samples.  It may be noted that Article 10(2) of Directive 79/695 envisages ‘the subsequent verification by the competent authorities of the Member State in which the goods have been released for free circulation’. (23) 57.      Where however the declarant cannot so demonstrate the identity of the goods and their condition, or a fortiori where perishable goods, such as the rice at issue in the present case, have in the mean time been released for free circulation and consumed, it will manifestly no longer be possible to take further samples and the declarant’s entitlement to challenge the original samples on the ground that they are not representative must lapse. 58.      I accordingly conclude that where a customs authority takes samples of imported goods in the presence of the declarant, who does not at the time challenge the representativeness of the samples, the declarant is not precluded, either by Directives 79/695 and 82/57 on the harmonisation of procedures for the release of goods for free circulation or by Regulation No 2913/92 establishing the Community Customs Code, from subsequently challenging the representativeness of the sample provided that the entire consignment of the goods remains available, with no possibility of any intervening alteration in their condition, for a further sample to be taken. 59.      Finally it is appropriate to mention the observations of the Commission concerning the non-implementation of Article 11 of Directive 82/57.  It submits that, since directives cannot have horizontal direct effect, that provision cannot be directly invoked by the customs authority against the declarant if it has not been implemented in national law.  The customs authority does not appear to have relied in the main proceedings on any provision of national law, thus suggesting that the directive had not been implemented.  Nor does the referring court mention any provision of national law in the order for reference.  National legislation to the effect that, once the imported goods could no longer be sampled and examined, a declarant could no longer contest the representativeness of samples taken in such circumstances would, however, in the view of the Commission be in accordance with the wording and objective of Article 11 of Directive 82/57. 60.      In response to that argument France at the hearing mentioned Article 101 of its Customs Code, apparently dating from 1948, which it claims made it unnecessary to implement Article 11.  Article 101 provides: ‘1.      After the detailed declaration has been lodged, the customs authority may if it considers it necessary check all or part of the declared goods. 2.      In the event of dispute, the declarant is entitled to challenge the results of a partial check and to request that the disputed information in the declaration be fully checked.’ 61.      It is not obvious that that provision may properly be regarded as adequate implementation of Article 11.  However, that seems to me of little consequence, given my preferred view that Article 11 is not relevant, and my conclusion that in any event the answer to the question referred is dictated by the scheme and objectives rather than the wording of the Community legislation.  The Commission’s general point none the less remains sound:  national legislation which permits a declarant to challenge the representativeness of samples would be consistent with the scheme and objectives of the Community legislation provided that the goods remain available for further sampling and provided that, where the goods have in the mean time been released for free circulation, it can be demonstrated that the entire consignment has since remained intact.   I –  Conclusion 62.      I accordingly consider that the question referred by the Cour de Cassation should be answered as follows: Where a customs authority takes samples of imported goods in the presence of the declarant, who does not at the time challenge the representativeness of the samples, the declarant is not precluded, either by Council Directive 79/695/EEC of 24 July 1979 on the harmonisation of procedures for the release of goods for free circulation and Commission Directive 82/57/EEC of 17 December 1987 laying down certain provisions for implementing Directive 79/695, or by Council Regulation (EEC) No 2913/92 of 12 December 1992 establishing the Community Customs Code, from subsequently challenging the representativeness of the sample provided that the entire consignment of the goods remains available, with no possibility of any intervening alteration in their condition, for a further sample to be taken. – Original language: English. 2– Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code, OJ 1992 L 302, p. 1.  – The party who makes the customs declaration;  see paragraph 4 below for the previous terminology.  – Article 253 of Regulation No 2913/92 provides that it is to apply from 1 January 1994.  – Directive of 24 July 1979 on the harmonisation of procedures for the release of goods for free circulation, OJ 1979 L 205, p. 19.  – Directive of 17 December 1981 laying down certain provisions for implementing Council Directive 79/695/EEC on the harmonisation of procedures for the release of goods for free circulation, OJ 1982 L 28, p. 38. 7– See Article 26(1) of Directive 79/695 and the second citation in the preamble to Directive 82/57. 8– Commission Regulation of 2 July 1993, OJ 1993 L 253, p. 1. 9– Council Regulation (EEC) No 1418/76 of 21 June 1976 on the common organisation of the market in rice, OJ 1976 L 166, p. 1.  – For a summary of the structure of the duties, see Case C-159/88 Van Sillevoldt and Others [1990] ECR I-2215, paragraph 4 of the judgment.  – Ibid., point 2(c)(i).  – Cited in note 10. 13– Regulation (EEC) No 2729/75 of 29 October 1975 on the import levies on mixtures of cereals, rice and broken rice, OJ 1975 L 281, p. 18.  With effect from 1 July 1995 the terms ‘levy’ and ‘levies’ in Regulation No 2729/75 were replaced by ‘duty’ and ‘duties’ by Council Regulation (EC) No 3290/94 of 22 December 1994 on the adjustments and transitional arrangements required in the agriculture sector in order to implement the agreements concluded during the Uruguay Round of multilateral trade negotiations, OJ 1994 L 349, p. 105.  – References in this Opinion to Derudder are to be taken to include its representative, unless it is otherwise clear from the context. 15– Ninth and tenth recitals.  – Final recital in the preamble to Directive 79/695.  – Fourth recital in the preamble to Directive 82/57.  – See paragraph 17 above. 19– Article 13(1) of Directive 82/57, set out in paragraph above;  Article 242(1) of Regulation No 2454/93, set out in paragraph above.  – Article 14(1) of Directive 82/57, set out in paragraph 10 above;  Article 243(1) of Regulation No 2454/93, set out in paragraph 21 above.  – See Article 246(1) of Regulation No 2454/93. 22– Cf. Article 37 of the Customs Code.  – Cf. Article 78 of the Customs Code.