While carrying out their obligations to protect the borders and the customs revenues of the European Union, customs authorities face a tall order maneuvering in the labyrinth of regulations. It is often difficult to decide how much discretionary power EU customs authorities can exercise while being stringent on their duty. Let us look at the guidance the CJEU provides in this matter.
Facts of the case and basis of the dispute
A German importer imported goods from Nigeria and claimed preferential tariff treatment during the preparatory period of the Cotonou Agreement signed by the EU and the African, Caribbean and Pacific (APC) Group of States. The EUR.1 certificates were not examined upon importation; nevertheless, they turned out to be formally incorrect during a post-clearance examination carried out after the preparatory period of the Agreement lapsed. The formal failure lay in the shape of stamps on the origin declaration. As such, customs duties were assessed retrospectively.
The importer obtained newly issued origin certificates retrospectively in Nigeria; nevertheless, the remark on them did not entirely match the wording prescribed by the Agreement for such circumstances. The question arose whether the subsequently assessed duties could be reclaimed upon presenting the replacement origin certificates, given the peculiarities of the case.
You can read the entire judgment under the following link:
Merits of the case
Under preferential tariff agreements, inappropriate origin certificates can be challenged by the importing state by notifying the exporting state and initiating a formal control procedure. If no such formal procedure is initiated, the exporting state does not have the possibility to form its legal judgment on the matter, which undermines the primary aim of cooperation facilitated by such agreements. As the CJEU points out, the rules concerning origin are based on “mutual trust between the authorities of the importing Member States and those of the exporting State”.
As regards why an origin stamp may deviate from the officially recognized format, the CJEU did not aim to establish a thin line between various scenarios, but stated that it would be impossible in practice for the importing state to detect any such reasons. Therefore, a formal control procedure would be desirable. A move to be welcomed by both customs authorities and economic operators as it relieves both sides from developing visionary capabilities currently uncommon in mankind.
What to bear in mind?
Needless to say, the formal requirements for claiming preferential tariff treatment must be observed not only by the authorities, but also by economic operators. Training of the responsible staff as well as having a healthy ‘questioning’ attitude towards suppliers, especially from regions which we have limited experience with are helpful. As the saying goes: ‘the devil is in the detail.’