On 8 October 2020, the ECJgave its decision in Staatssecretaris van Financiën, other party: Exter BV (C-330/19)
Summary
In the Exter case (C-330/19), the European Court of Justice clarified the meaning of ‘taxable elements’ in article 121 UCC. The key question centered around which elements should be considered for the determination of the customs duty. In particular, the question was whether ‘taxable elements’ refer to the customs tariff and preferential rates applicable when goods are placed under Inward Processing Procedure (‘IPP’), or whether they refer to the elements to which the rates and tariff measures are applied, such as the weight, the value and the quantity of the goods.
The ECJ took the purpose of an IPP into consideration. Thus, an IPP is meant as a suspension period of customs duties, followed by a re-exportation. When the goods are put into free circulation after all, it is not the intention that parties could misuse the IPP to benefit from preferential rates that have been suspended in the meantime. All importers should be treated equally, regardless of whether they used an IPP. Therefore, the ECJ concluded that ‘taxable elements’ refer to the elements to which customs tariffs and rates are applied (e.g. the weight, value and quantity of the goods), rather than the customs tariffs and preferential rates applicable at the moment of authorization of the IPP.
Decision
Article 121(1) of Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code must be interpreted as precluding the application of a preferential tariff measure leading to a reduced rate of customs duty, which was in force at the time of acceptance of the declaration of placing of goods under the inward processing procedure, but which was suspended at the date of acceptance of the declaration of release of those goods for free circulation
Source Curia
