In the context of a request for a preliminary ruling, the CJEU addressed the question of the reinstatement of the customs debt within the meaning of Article 116(7) UCC.
I. The facts
In the case to be decided, the claimant had originally declared electronic goods under a tariff heading carrying a duty rate of 8.7%. After it relied, for the purposes of classification, on a Binding Tariff Information issued to a third party, the tariff heading was changed (to duty-free), and duties paid in the amount of approximately €60,000 were refunded. A subsequent review of the classification by the customs authority, however, found that the tariff heading originally declared had in fact been correct. The customs authority therefore sought to reclaim the refunded duties from the claimant under Article 116(7) UCC.
The court hearing the case referred it to the CJEU, asking it to answer the legal question of whether Article 116(7) UCC covers only unintentional refunds by the customs authorities (for example, due to a mistake), or also deliberate decisions later found to be incorrect (for example, an incorrect tariff classification).
II. The decision
The CJEU held that the term “in error” in Article 116(7) UCC must be interpreted broadly. Deliberate, but factually incorrect, decisions by the customs authority therefore also fall within the scope of Article 116(7) UCC. The reinstatement of the customs debt is accordingly not limited to cases of mistake.
This interpretation, the Court held, serves the proper collection of customs debts and the alignment of the legal position with the actual and legal situation, taking into account both the limitation provisions (Article 103 UCC) and the protection of legitimate expectations. Within the applicable limitation periods, an economic operator must therefore also reckon with the possibility that a decision may subsequently be issued to its disadvantage.
The CJEU accordingly formulated the following holding:
Article 116(7) UCC must be interpreted as meaning that the reinstatement of the customs debt covers not only cases in which duties were refunded as a result of a mistake by the customs authorities, but also cases in which those authorities deliberately made an incorrect tariff classification that later proved to be wrong.
III. Consequences for practice
The customs debt can be reinstated where an incorrect refund resulted from a mistaken assessment by the authority. Companies must therefore reckon with the possibility that customs decisions made in their favour may also be reviewed and, where necessary, reversed. This applies, however, only where the debt is not yet time-barred under Article 103 UCC, calculated from the point in time at which the customs debt is communicated.
In this context, it should also be considered, alongside the question of limitation, whether protection of legitimate expectations may apply on the basis of an “active” error on the part of the customs authorities, which could preclude retrospective assessment. Although the interpretation of protection of legitimate expectations based on an “active error” is always applied very restrictively, there may, in individual cases, be grounds for finding that such protection applies.
By Heiko Panke
