EGC T-383/25 (Segelbootwartung) – AG Opinion – Swiss boat repair in Germany: VAT due without customs declaration.

On June 3, 2026, the General Court issued the AG Opinion in the case T-383/25 (Segelbootwartung)

Context: Reference for a preliminary ruling – Customs Union – Regulation (EU) No 952/2013 – Value added tax – Directive 2006/112/EC – Sailing boat brought into the European Union, without being presented to customs, for maintenance and repair works – Imposition of customs duties and import VAT

Summary

Facts: A Swiss resident brought a sailing boat into Germany for repairs without customs clearance. German customs imposed import duties and VAT. The boat was repaired and re-exported without being used for transport in the EU. The owner challenged the charges, arguing that the services were distinct from importation and that the debts might have been extinguished.
Issue: The central question is whether import VAT and customs duties are owed when a non-EU means of transport enters the EU solely for maintenance and repair, without customs declaration, and is subsequently re-exported without being used for transport.
Questions to the Court: The German Federal Fiscal Court asked the CJEU: 1) Does a means of transport enter the EU’s economic network if only services (maintenance/repair) are performed on it, without it being used for transport? 2) Do maintenance/repair works constitute “use” under Article 124(1)(k) of the UCC, extinguishing customs debt, even if the good isn’t used for transport and is re-exported?
AG Opinion – Import VAT: The AG opined that physical entry of goods from a third country into the EU triggers import VAT, as it implies entry into the EU’s economic network, unless the goods are placed under a special customs procedure like inward processing. The only way to avoid this is a retroactive inward processing authorization.
AG Opinion – Customs Debt: The AG concluded that maintenance and repair operations on a non-Union good, without inward processing authorization, constitute “use” for the purposes of Article 124(1)(k) UCC, meaning the customs debt is not extinguished. This strict interpretation aims to prevent abuse and protect EU resources.

Articles discussed in the EU VAT Directive 2006/112/EC

Article 2(1)(d): This article establishes that the importation of goods is a transaction subject to VAT. [1]
Article 30: This article defines “importation of goods” as the entry into the European Union of goods not in free circulation within the meaning of Article 29 TFEU.
Article 70: This article states that the chargeable event for import VAT occurs and VAT becomes chargeable when the goods are imported.
Article 71(1) (first subparagraph): This provision outlines that if goods are placed under certain specific customs arrangements upon entry into the EU, the chargeable event and chargeability of VAT only occur when the goods cease to be covered by that arrangement.

Questions

The Bundesfinanzhof (Federal Fiscal Court, Germany) referred the following questions for a preliminary ruling to the Court of Justice of the European Union:

“Does a means of transport enter the economic network of the European Union if it is not used as a means of transport in a Member State, but a service (in the present case: maintenance and repair works) is [provided in respect of] it?”
“Is Article 124(1)(k) of the [UCC] to be interpreted as meaning that … non-Union good[s] [are] used, [for] the [purposes] of that provision, if, within the customs territory of the [European] Union, only maintenance or repair works are carried out on [them], and the non-Union good[s] [are] then re-exported?”

AG Opinion

1. Articles 30 and 70 and the first subparagraph of Article 71(1) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax

must be interpreted as meaning that the mere fact of physically introducing into a Member State of the European Union a means of transport from a third country, without placing it under the inward processing procedure, in order for maintenance and repair operations to be carried out on it, even if that means of transport was subsequently re-exported without having been used as a means of transport while it was physically present in that Member State, constitutes an importation triggering the chargeable event for import value added tax (VAT) purposes and the chargeability of that tax, unless the person concerned is issued with a retroactive inward processing authorisation by the competent customs authorities in accordance with Article 211(2) of Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code.

2. Article 124(1)(k) of Regulation No 952/2013

must be interpreted as meaning that, where a means of transport has been temporarily brought into the customs territory of the European Union without an authorisation to use the inward processing procedure, maintenance and repair operations carried out in that customs territory constitute use for the purposes of that provision, even if that means of transport was not used for transportation purposes while it was present in the customs territory of the European Union, unless those operations are authorised by a retroactive inward processing authorisation granted by the customs authorities in accordance with Article 211(2) of that regulation.

Decision

Source

Curia

Other ECJ Cases Discussed in the AG Opinion

The Advocate General’s opinion in Case T-383/25, Hauptzollamt A v Segelbootwartung, refers to several other ECJ (European Court of Justice) cases to support its arguments, particularly concerning the interpretation of VAT and customs legislation. These cases help to establish the existing jurisprudence on import VAT, customs debt, and the concept of goods entering the economic network of the EU.

Here are the other ECJ cases discussed in the AG’s opinion:

C-226/14, Eurogate Distribution and C-228/14, DHL Hub Leipzig: These joined cases concerned accounting irregularities in customs warehousing and non-fulfillment of external transit procedure obligations. The AG uses them to illustrate situations where goods, despite irregularities, were not considered imported for VAT purposes because they remained under customs arrangements until re-exported.
C-571/15, Wallenborn: This case involved a breach of the external transit procedure in a free zone. The Court found that if the goods did not enter the economic network of the EU, import VAT was not due. The AG cites this to show that the actual entry into the economic network is crucial.
C-154/16, Latvijas dzelzceļš: This case dealt with goods that were destroyed or irretrievably lost while under external Community transit. The Court held that import VAT was not due for such goods as they could not enter the economic network of the EU.
C-489/20, Kauno teritorinė muitinė: This case concerned contraband cigarettes illegally brought into the EU, seized, and confiscated. The Court ruled that the chargeable event for VAT had already occurred, and import VAT remained chargeable even if the customs debt was extinguished. The AG uses this to emphasize that potential consumption triggers VAT liability when goods are not under customs supervision.
C-26/18, Fedex: This case addressed the determination of the place where import VAT is incurred when goods are introduced in breach of customs legislation. The AG refers to this case to distinguish between the existence of an import VAT debt and the place where it is incurred.
C-7/20, Hauptzollamt Münster (Place where VAT is incurred): Similar to Fedex, this case concerned a motor vehicle brought into the EU in breach of customs legislation. The Court held that the place of actual use determines where the vehicle entered the economic network.
C-368/21, Hauptzollamt Hamburg (Place where VAT is incurred – II): This case also dealt with the place where VAT is incurred for a vehicle imported in violation of customs law, where the Court considered the place of residence of the user as relevant information.
C-476/19, Combinova: This case is directly cited for its interpretation of the concept of “use” in Article 124(1)(k) of the UCC, particularly in the context of inward processing procedures. The AG relies heavily on this judgment for the second question referred to the Court.

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Executive Summary

Advocate General (AG) BRKAN delivered an Opinion on June 3, 2026, regarding a complex case concerning a private individual from Switzerland who brought a sailing boat into Germany for maintenance and repair work without customs clearance. The German customs authority (Hauptzollamt A) subsequently imposed import customs duties and import VAT. The core of the Opinion addresses whether, under these circumstances, import VAT and customs duties are chargeable, and if the re-export of the boat without prior use in the EU negates these charges, particularly in light of the Union Customs Code (UCC) and the VAT Directive.

The AG concludes that both import VAT and customs duties are indeed chargeable in such a scenario, emphasizing that the physical introduction of goods into the EU without placing them under a designated customs procedure (like inward processing) automatically triggers these liabilities. The re-export of the goods, or the fact they were not “used” for their primary purpose (transport) in the EU, does not by itself extinguish these debts. However, the AG highlights that a retroactive authorisation for inward processing, if granted by customs authorities under Article 211(2) of the UCC, could potentially rectify the situation and avoid both the import VAT and customs duty liabilities.

Case Overview (T-383/25)

Parties: Hauptzollamt A (Appellant, Principal Customs Office, Germany) vs. Segelbootwartung (Respondent, a natural person residing in Switzerland).
Origin: Request for a preliminary ruling from the Bundesfinanzhof (Federal Fiscal Court, Germany).
Facts of the Main Proceedings:On March 28, 2017, a Swiss resident brought a Swiss-registered sailing boat into Germany on a trailer, via Customs Office A, without undergoing customs clearance.
The declared purpose was maintenance and repair work on the outboard motor by a German company.
The Hauptzollamt issued a notice imposing import customs duties and import VAT.
The respondent paid the duties, had the work done, and re-exported the boat to Switzerland on May 18, 2017.
Crucially, the boat was not used for any other purpose in the EU customs territory.
The respondent challenged the imposition, arguing that the boat had not entered the EU’s economic network and that any debts were extinguished by re-export under Article 124(1)(k) UCC.
The referring court noted that the respondent did not have an inward processing authorisation but is pursuing an application for a retroactive one.

Questions Referred for a Preliminary Ruling:“Does a means of transport enter the economic network of the European Union if it is not used as a means of transport in a Member State, but a service (in the present case: maintenance and repair works) is [provided in respect of] it?”
“Is Article 124(1)(k) of the [UCC] to be interpreted as meaning that … non-Union good[s] [are] used, [for] the [purposes] of that provision, if, within the customs territory of the [European] Union, only maintenance or repair works are carried out on [them], and the non-Union good[s] [are] then re-exported?”

Key Legal Framework

The Opinion interprets provisions from:

Council Directive 2006/112/EC (VAT Directive): Primarily Articles 2(1)(d), 30, 70, and 71.
Regulation (EU) No 952/2013 (Union Customs Code – UCC): Primarily Articles 79(1)(a), 124(1)(k), 211, and 256.

Analysis of Main Themes and Ideas
Chargeability of Import VAT (First Question)

The AG addresses whether import VAT becomes chargeable when a means of transport enters the EU for repairs without a specific customs procedure, even if subsequently re-exported without use.

General Rule for Import VAT: Article 2(1)(d) of the VAT Directive states that “importation of goods” is subject to VAT. This applies even to private individuals and regardless of whether a transaction occurs or is for consideration (Para 22). The chargeable event occurs, and VAT becomes chargeable, when goods physically enter the EU (Article 70 VAT Directive, Para 23).
Exception: Special Customs Arrangements: Article 71(1) of the VAT Directive provides an exception: if goods are placed under certain customs arrangements (like inward processing), the chargeable event and chargeability of VAT are suspended until the goods cease to be covered by that arrangement (Para 23). These arrangements create a “legal fiction” that the goods are not, from a legal standpoint, in the EU (Para 24).
“Entry into the Economic Network of the EU” and “Potential Consumption”:The AG argues that when goods are physically introduced into the EU without being placed under a customs arrangement, they are presumed to have “entered the economic network of the European Union” (Para 35). This presumption arises because, without customs supervision, such goods are “liable to be consumed or used within the European Union” (Para 35).
The AG clarifies that it is the potential consumption or use, not actual consumption or use, that triggers import VAT. Citing Kauno teritorinė muitinė (C-489/20), the AG states: “although VAT is a consumption tax, it is not the actual consumption of goods within the European Union that triggers the chargeable event and the chargeability of import VAT, but rather potential consumption” (Para 34).
Therefore, the fact that the sailing boat was re-exported without being used for transport in Germany does not negate the initial import VAT chargeability if it was not under a customs procedure (Para 47).
Importance of Compliance and Prevention of Abuse: The AG stresses the importance of adhering to the system laid down in Articles 70 and 71(1) of the VAT Directive to ensure “external neutrality” and prevent “abuse or fraud” (Para 29, 38). The absence of customs supervision at entry, when goods are not under an arrangement, creates a significant risk of unchecked use or sale within the EU (Para 39).
The Decisive Role of Retroactive Authorisation: The AG emphasizes that the only way to rebut the presumption of entry into the economic network, in cases where goods were introduced without proper procedure, is for customs authorities to issue an inward processing authorisation with retroactive effect (Article 211(2) UCC). Such an authorisation would then fulfil the requirement of Article 71(1) of the VAT Directive (Para 48).

Extinguishment of Customs Debt (Second Question)

The second question concerns whether maintenance and repair works constitute “use” for the purposes of Article 124(1)(k) UCC, which could prevent the extinguishment of a customs debt upon re-export.

Article 124(1)(k) UCC: This provision allows for the extinguishment of customs debt if non-Union goods under a special procedure are re-exported. However, this is conditional on the goods not having been “used.”
Interpretation of “Use”: The UCC does not define “use.” Drawing on the Court of Justice’s ruling in Combinova (C‑476/19), the AG clarifies that “use” for the purposes of Article 124(1)(k) UCC refers “solely to use going beyond the processing procedures authorised by the customs authority” (Para 52).
“Use” Without Authorisation: In the absence of any authorisation for inward processing, any operations (including maintenance and repair) carried out on the goods in the EU customs territory constitute “use” because they “necessarily go beyond the processing procedures authorised by the customs authority” (Para 53). Since no procedures were authorised, any activity is considered unauthorised use.
Strict Interpretation: The AG reinforces that provisions extinguishing customs debts, and exceptions to customs duties (like inward processing), must be interpreted strictly to protect the EU’s own resources (Para 56).
Retroactive Authorisation as a Solution: Similar to VAT, the AG points out that if a retroactive inward processing authorisation is obtained under Article 211(2) UCC, then the maintenance and repair operations would be considered “authorised processing procedures” and thus would not constitute “use” preventing the extinguishment of the customs debt (Para 59). Without such a retroactive authorisation, the debt remains.

Conclusion of the Advocate General

AG BRKAN proposes that the General Court answer the referred questions as follows:

Import VAT: “the mere fact of physically introducing into a Member State of the European Union a means of transport from a third country, without placing it under the inward processing procedure, in order for maintenance and repair operations to be carried out on it, even if that means of transport was subsequently re-exported without having been used as a means of transport while it was physically present in that Member State, constitutes an importation triggering the chargeable event for import value added tax (VAT) purposes and the chargeability of that tax, unless the person concerned is issued with a retroactive inward processing authorisation by the competent customs authorities in accordance with Article 211(2) of Regulation (EU) No 952/2013.” (Para 61)
Customs Debt: “where a means of transport has been temporarily brought into the customs territory of the European Union without an authorisation to use the inward processing procedure, maintenance and repair operations carried out in that customs territory constitute use for the purposes of that provision, even if that means of transport was not used for transportation purposes while it was present in the customs territory of the European Union, unless those operations are authorised by a retroactive inward processing authorisation granted by the customs authorities in accordance with Article 211(2) of that regulation.” (Para 61)

Broader Context and Relevance

This Opinion underscores the critical importance of adhering to proper customs procedures when bringing goods from third countries into the EU, even for temporary purposes like repairs. The default position is that both import VAT and customs duties are due upon physical entry unless a specific customs arrangement is declared and followed. The potential for obtaining a retroactive authorisation provides a narrow avenue for rectification but is not guaranteed.

As highlighted by VATupdate.com, staying informed on such complex legal interpretations from the ECJ, CJEU, and General Court is “essential” for professionals dealing with EU VAT and customs law. Such rulings often clarify nuanced points of law that have significant implications for compliance and financial liabilities for businesses and individuals operating across EU borders.