JUDGMENT OF THE COURT (First Chamber)
9 February 1999 (1)
(Combined nomenclature — Tariff headings — Junction box without cables or
contacts)
In Case C-280/97,
REFERENCE to the Court under Article 177 of the EC Treaty by the
Finanzgericht Düsseldorf (Germany) for a preliminary ruling in the proceedings
pending before that court between
ROSE Elektrotechnik GmbH & Co. KG
and
Oberfinanzdirektion Köln
on the interpretation of the combined nomenclature as contained in Annex I to
Commission Regulation (EC) No 1734/96 of 9 September 1996 amending Annex I
to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature
and on the Common Customs Tariff (OJ 1996 L 238, p. 1),
THE COURT (First Chamber),
composed of: D.A.O. Edward, acting for the President of the Chamber, L. Sevón
(Rapporteur) and M. Wathelet, Judges,
Advocate General: N. Fennelly,
Registrar: R. Grass,
after considering the written observations submitted on behalf of:
— ROSE Elektrotechnik GmbH & Co. KG, by Gert Schemmann,
Außenwirtschaftsberater, Hamburg,
— the Oberfinanzdirektion Köln, by Elke Schmidt, Regierungsrätin, Cologne,
— the Commission of the European Communities, by Fernando Castillo de la
Torre, of its Legal Service, and Karin Schreyer, a national civil servant on
secondment to that Service, acting as Agents, assisted by Hans-Jürgen Rabe
and Marco Núñez Müller, Rechtsanwälte, Hamburg,
having regard to the report of the Judge-Rapporteur,
after hearing the Opinion of the Advocate General at the sitting on 14 May 1998,
gives the following
Judgment
- 1.
- By order of 22 July 1997, received at the Court on 1 August 1997, the
Finanzgericht (Finance Court), Düsseldorf, referred to the Court for a preliminary
ruling under Article 177 of the EC Treaty two questions on the interpretation of
the combined nomenclature as contained in Annex I to Commission Regulation
(EC) No 1734/96 of 9 September 1996 amending Annex I to Council Regulation
(EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common
Customs Tariff (OJ 1996 L 238, p. 1).
- 2.
- Those questions were raised in proceedings between ROSE Elektrotechnik GmbH
& Co. KG ('ROSE‘) and the Oberfinanzdirektion (Principal Revenue Office,
hereinafter 'the Oberfinanzdirektion‘), Cologne, concerning the customs
classification of a product described as a junction box. The article in question is
a rectangular container (approximately 21.7 cm long, 8 cm high and 11.7 cm wide)
with a lid of coated die-cast aluminium (aluminium/silicon alloy with aluminium
content predominant by weight). In the lid, in which a plastic insulation has been
inset, there are four steel connecting bolts. The article is intended to receive
electrical terminals (series terminals) of various types and dimensions and, in
addition to holes for screw connections, it also has holes for fastening. In addition,
it has four threaded holes designed for earthing bolts of copper-plated steel. Those
bolts are packed loose in the product. There are no other connecting devices.
- 3.
- The tariff headings of the combined nomenclature ('CN‘) regarded as relevant by
the national court are as follows:
'7616 Other articles of aluminium:
...
— Other
...
7616 99 — — Other:
7616 99 10 — — — Cast.
...
8536 Electrical apparatus for switching or protecting electrical circuits, or
for making connections to or in electrical circuits (for example,
switches, relays, fuses, surge suppressors, plugs, sockets, lamp-holders,
junction boxes), for a voltage not exceeding 1 000 V:
...
8536 90 — Other apparatus:
...
8536 90 85 — — Other.
...
8538 Parts suitable for use solely or principally with the apparatus of
heading Nos 8535, 8536 or 8537:
8538 10 00 — Boards, panels, consoles, desks, cabinets and other bases for the
goods of heading No 8537, not equipped with their apparatus
8538 90 — Other:
8538 90 10 — — Electronic assemblies
8538 90 90 — — Other.‘
- 4.
- The General Rules for the interpretation of the combined nomenclature, as
contained in Part One, Section I, A, of the CN, provide in particular:
'Classification of goods in the combined nomenclature shall be governed by the
following principles:
...
2. (a) Any reference in a heading to an article shall be taken to include a
reference to that article incomplete or unfinished, provided that, as
presented, the incomplete or unfinished article has the essential
character of the complete or finished article. It shall also be taken to
include a reference to that article complete or finished (or falling to
be classified as complete or finished by virtue of this rule), presented
unassembled or disassembled.
(b) Any reference in a heading to a material or substance shall be taken
to include a reference to mixtures or combinations of that material or
substance with other materials or substances. Any reference to goods
of a given material or substance shall be taken to include a reference
to goods consisting wholly or partly of such material or substance.
The classification of goods consisting of more than one material or
substance shall be according to the principles of rule 3.
3. When by application of rule 2(b) or for any other reason, goods are prima
facie classifiable under two or more headings, classification shall be effected
as follows:
(a) the heading which provides the most specific description shall be
preferred to headings providing a more general description. However,
when two or more headings each refer to part only of the materials
or substances contained in mixed or composite goods or to part only
of the items in a set put up for retail sale, those headings are to be
regarded as equally specific in relation to those goods, even if one of
them gives a more complete or precise description of the goods;
(b) mixtures, composite goods consisting of different materials or made
up of different components, and goods put up in sets for retail sale,
which cannot be classified by reference to 3(a), shall be classified as
if they consisted of the material or component which gives them their
essential character in so far as this criterion is applicable‘.
- 5.
- The Explanatory Notes to the Harmonised Commodity Description and Coding
System of the Customs Cooperation Council (1996 edition) state, in the first
paragraph of point (II) of Rule 2(a) of the General Rules for the interpretation of
the Harmonised System, headed 'Incomplete or unfinished articles‘:
'The provisions of this Rule also apply to blanks unless these are specified in a
particular heading. The term ”blank” means an article, not ready for direct use,
having the approximate shape or outline of the finished article or part, and which
can only be used, other than in exceptional cases, for completion into the finished
article or part.‘
- 6.
- According to Note (III)(C) of the Customs Cooperation Council's Explanatory
Notes concerning heading 8536, junction boxes are 'boxes fitted internally with
terminals or other devices for connecting together electrical wires. Junction boxes
not fitted with means of electrical connection, but used solely as a protective cover
or to hold an insulating compound over a joint made independently, are not
covered here, but are classified according to their constituent material.‘
- 7.
- ROSE applied to have the product at issue in the main proceedings classified as
a junction box under subheading 8536 90 85 of the CN. That application was
rejected on 11 July 1996 by the Oberfinanzdirektion, which classified the article
under subheading 7616 99 10 of the CN describing 'Other articles of aluminium
— Cast‘, principally on the ground that it contained no connecting devices, but
served merely as a container for the protection or insulation against environmental
influences of a joint made independently.
- 8.
- ROSE therefore brought proceedings contesting that decision before the
Finanzgericht.
- 9.
- That court observes that, apart from the missing terminals, connections and holes,
the product has the external appearance of a junction box within heading 8536
without its complete contents. It is uncertain as to the correct classification of the
product, given that, on the one hand, it could be inferred from the description of
articles in heading 8536 that the essential character of a junction box is to be found
in the presence of connecting devices for joining electrical circuits, whereas, on the
other hand, the definition of the term 'blank‘ contained in point (II) of the
explanatory note relating to Rule 2(a) of the General Rules is wider in scope.
- 10.
- The Finanzgericht is also uncertain as to what electrical lines the connecting devices
referred to in the explanatory notes concerning heading 8536 must be fitted for.
According to its findings, the copper-plated earthing bolts and the threaded holes
serve in the present case to connect up a 'protective conductor‘; it states, however,
that, as is well known and undeniable, such an earthing connection does not close
or connect any electrical circuit.
- 11.
- The Finanzgericht, taking the view that an interpretation of Community law was
necessary in order to enable it to determine the proceedings before it, decided to
stay proceedings and to refer the following questions to the Court for a preliminary
ruling:
'1. Is the Common Customs Tariff in the version in Annex I to Commission
Regulation (EC) No 1734/96 of 9 September 1996 amending Annex I to
Council Regulation (EEC) No 2658/87 on the tariff and statistical
nomenclature and on the Common Customs Tariff (Combined
Nomenclature 1997) to be interpreted as meaning that an article described
as a junction box and consisting of a rectangular container with lid of coated
die-cast aluminium (aluminium/silicon alloy with aluminium content
predominant by weight) with four steel connecting bolts and four earthing
bolts of copper-plated steel (packed loose in the article and yet to be
inserted into threaded holes provided for that purpose) is to be classified
under heading 8538?
2. If the answer to Question 1 is negative: Is the Common Customs Tariff
(Combined Nomenclature 1997) to be interpreted as meaning that such an
article is to be classified, applying the first sentence of General Rule 2(a)
for the interpretation of the Combined Nomenclature, under heading
8536?‘
Question 2
- 12.
- By its second question, which it is appropriate to examine first, the national court
is asking, in essence, whether the CN must be interpreted as meaning that a
product such as that in issue in the main proceedings falls to be classified under
heading 8536 as an incomplete junction box.
- 13.
- ROSE maintains that that question should be answered in the affirmative; it points
out that the distinctive characteristics of the product in question, which is
manufactured for particular industrial uses and cannot be used otherwise than for
its intended purpose, are its standardised form with its technical fittings. It denies
that the terminals constitute distinctive characteristics and observes that, because
of the great diversity of the connecting devices which may be fitted, the terminals
or terminal strips which are added and the holes which are made depend on the
intended industrial use. Lastly, it states that the fitting of the corresponding
terminals to a junction box does not in itself guarantee, or have the effect of
guaranteeing, that an electrical circuit is also established or cut, and that, because
an earth connection permits current to pass in an emergency or where necessary,
it cannot be dissociated from the concept of the establishment of an electrical
circuit or of a connection carrying an electric current.
- 14.
- The Oberfinanzdirektion denies that the article in issue constitutes a junction box,
even in incomplete form, since the earthing bolts supplied with the product are not
devices for connecting together electrical wires, inasmuch as an earthing connection
does not enable either a circuit or a network to exist. It states that the product
does not contain any other connecting devices; the boxes are fitted with terminals
only where specially requested by customers and, in any event, only after they have
been imported.
- 15.
- The Commission also observes that the product at issue in the main proceedings
is not fitted with any device for connecting together electrical wires and that the
earthing bolts supplied with that product do not serve to connect up an electrical
circuit and make it work. Having regard to its assembly, its equipment and its
objective properties, its principal function is to protect a connection which has
already been made against electric shocks and/or humidity.
- 16.
- It is settled case-law that, in the interests of legal certainty and for ease of
verification, the decisive criterion for the classification of goods for customs
purposes is in general to be sought in their objective characteristics and properties
as defined in the wording of the relevant heading of the CN. There are also
explanatory notes drawn up, as regards the CN, by the Commission and, as regards
the Harmonised Commodity Description and Coding System, by the Customs
Cooperation Council, which may be an important aid to the interpretation of the
scope of the various tariff headings but do not have legally binding force (see, in
particular, Case C-201/96 LTM v FIRS [1997] ECR I-6147, paragraph 17, and the
judgment of 10 December 1998 in Case C-328/97 Glob-Sped, not yet published in
the European Court Reports, paragraph 26).
- 17.
- Note (III)(C) of the Customs Cooperation Council's Explanatory Notes concerning
heading 8536 requires junction boxes to be fitted internally with terminals or other
devices for connecting together electrical wires, whereas a box not fitted with
means of electrical connection, but used solely as a protective cover or to hold an
insulating compound over a joint made independently, is not covered by that note,
being classified according to its constituent material.
- 18.
- Moreover, it is apparent from Rule 2(a) of the General Rules for the interpretation
of the CN that, for the purposes of customs classification, an incomplete or
unfinished article is to be treated in the same way as a complete or finished article,
provided that it has the essential character of the complete or finished article. That
rule of interpretation is itself clarified by the Customs Cooperation Council's
explanatory notes, according to which the heading relating to the finished product
covers blanks, that is to say, articles which, although not ready for direct use, have
the approximate shape or outline of the finished article and can only be used for
completion into the finished article.
- 19.
- The national court has found that the product in issue has the external appearance
of a junction box and is designed to be fitted with electrical terminals. Subject to
any more detailed findings of fact which that court may make, and having regard
to the technical information which it has furnished to this Court, it does not seem,
as the Advocate General observes in point 30 of his Opinion, that the product in
question could be used otherwise than as a junction box.
- 20.
- The absence of terminals cannot mean that the product lacks the essential
characteristics of a junction box and that it cannot therefore be regarded as an
incomplete junction box. It is not disputed that those terminals are fitted
subsequently only because their form and dimensions depend on the industrial use
to which the box is to be put. It follows that their absence does not alter the basic
purpose which the product in question is intended to serve.
- 21.
- Moreover, even if its function were to house a connection made through a medium
other than terminals fitted to its structure, nevertheless, it would still fall to be
classified under heading 8536, the wording of which expressly refers to apparatus
for protecting electrical circuits.
- 22.
- That finding is not invalidated by the Customs Cooperation Council's explanatory
notes, which provide that such products are to be classified according to their
constituent material.
- 23.
- It is settled case-law that, whilst those explanatory notes may be regarded as a
valuable aid to the interpretation of the CN, they do not have legally binding force,
so that it is necessary, where appropriate, to examine whether their content is in
accordance with the actual provisions of the Common Customs Tariff and whether
they alter the meaning of those provisions (see, in particular, Case C-35/93 Develop
Dr Eisbein [1994] ECR I-2655, paragraph 21, Case C-201/96 LTM, cited above,
paragraph 17, and Case C-328/97 Glob-Sped, cited above, paragraph 26).
- 24.
- In the present case, inasmuch as those notes require a junction box to be fitted
internally with devices for connecting together electrical wires and provide, in
particular, that a box used solely as a protective cover or to hold an insulating
compound over a joint made independently is to be classified according to its
constituent material, they are contrary to the actual wording of heading 8536 and
alter its meaning.
- 25.
- Consequently, the answer to the second question must be that the CN, as contained
in Annex I to Regulation No 1734/96, must be interpreted as meaning that a
product consisting of a rectangular container with a lid of coated die-cast
aluminium (aluminium/silicon alloy with aluminium content predominant by
weight), four steel connecting bolts and four earthing bolts of copper-plated steel
(packed loose in the product and yet to be inserted into threaded holes provided
for that purpose), which is intended to receive electrical terminals and holes
enabling electrical circuits to be connected, must be classified, in accordance with
Rule 2(a) of the General Rules for the interpretation of the CN, under subheading
8536 90 85 as an incomplete junction box.
Question 1
- 26.
- In view of the answer given to the second question, there is no need to reply to the
first question.
Costs
- 27.
- The costs incurred by the Commission, which has submitted observations to the
Court, are not recoverable. Since these proceedings are, for the parties to the
main action, a step in the proceedings pending before the national court, the
decision on costs is a matter for that court.
On those grounds,
THE COURT (First Chamber),
in answer to the questions referred to it by the Finanzgericht Düsseldorf by order
of 22 July 1997, hereby rules:
The combined nomenclature, as contained in Annex I to Commission Regulation
(EC) No 1734/96 of 9 September 1996 amending Annex I to Council Regulation
(EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common
Customs Tariff, must be interpreted as meaning that a product consisting of a
rectangular container with a lid of coated die-cast aluminium (aluminium/silicon
alloy with aluminium content predominant by weight), four steel connecting bolts
and four earthing bolts of copper-plated steel (packed loose in the product and yet
to be inserted into threaded holes provided for that purpose), which is intended to
receive electrical terminals and holes enabling electrical circuits to be connected,
must be classified, in accordance with Rule 2(a) of the General Rules for the
interpretation of the combined nomenclature, under subheading 8536 90 85 as an
incomplete junction box.
Delivered in open court in Luxembourg on 9 February 1999.
R. Grass
P. Jann
Registrar
President of the First Chamber
