law://eu/cjeu/1980/c-205-80@2026-11-15In Case 205/80REFERENCE to the Court under Article 177 of the EEC Treaty by the Finanzgericht [Finance Court] Berlin for a preliminary ruling in the action pending before that court betweenELBA Elektroapparate- und Maschinenbau Walter Goettmann KG, Berlin,andHauptzollamt [Principal Customs Office] Berlin-PackhofTHE COURT (Second Chamber),composed of: P. Pescatore, President of Chamber, O. Due and A. Chloros, Judges,Advocate General: G. ReischlRegistrar: H. A. Rühl, Principal Administratorgives the following
The facts and the arguments presented by the parties during the written procedure may be summarized as follows :
The undertaking ELBA Elektroapparate-und Maschinenbau Walter Goettmann KG, the plaintiff in the main action before the Finanzgericht Berlin, imported from Taiwan via the Hauptzollamt Berlin-Packhof a quantity of what may conveniently be called flashing light circles for which it applied for release into free circulation on 20 December 1978. The article consists of a circular plastic frame (diameter roughly 21 cm) to which are attached by means of plastic holders 49 candle-shaped electric light bulbs, about 24 mm long, of various colours and connected together with electric cable. They are in addition decorated with silver tinsel and a coloured loop of tinfoil. The incandescent bulbs, which are arranged in three circles of different colours in each case, light up (flash) alternately when the electricity is switched on. The bulbs, which are not provided with sockets and are simply inserted by their lead-in wires into the lamp-holders, which are integral parts of the electric cables, are connected in series. Their voltage is less than 42 volts and their nominal power is less than 15 watts.On importation ELBA declared the flashing light circles under tariff heading 97.05 of the Common Customs Tariff. The Hauptzollamt, the defendant in the main action, classified the light circles under tariff heading 97.05, in accordance with the initial request of the applicant, which consequently paid the customs duty of 10%.Under tariff heading 97.05 of the Common Customs Tariff are classified :“Carnival articles; entertainment articles (for example, conjuring tricks and novelty jokes); Christmas tree decorations and similar articles for Christmas festivities (for example, artificial Christmas trees, Christmas stockings, imitation yule logs, Nativity scenes and figures therefor)”.ELBA objected and sought a fresh classification of the light circles under tariff heading 85.20 of the Common Customs Tariff but the Hauptzollamt Berlin-Packhof decided in the end that the goods should be classified under tariff subheading 39.07 E IV of the Common Customs Tariff and consequently imposed a customs duty of 17.6%.Tariff subheading 39.07 EIV of the Common Customs Tariff is a “catch-all” tariff heading and includes the following goods :“39.07. Articles of materials of the kinds described in headings nos 39.01 to 39.06:A. Of regenerated celluloseB. Of vulcanized fibreC. Of hardened proteinsD. Of chemical derivatives of rubberE. Of other materials:...IV. Other”.According to the order of the Finanzgericht Berlin referring the matter to the Court, the arguments of the parties to the main action are these:The plaintiff which, in its action before the Finanzgericht, seeks to have the “flashing light circles” classified as Christmas-tree decorations under tariff heading 97.05 of the Common Customs Tariff submits that they are not goods put up in sets. The items which give the goods their essential character are the electric light bulbs and not the plastic components which perform only a subsidiary function. The goods in question have been manufactured as Christmas-tree decorations for the American market.In its decision of 25 January 1980 on the objection the Hauptzollamt Berlin-Packhof on the other hand came to the view that the goods in question were goods set up in sets to be classified on the basis of the component giving them their essential character. The character of the “light circles” is determined essentially by the items made of plastic so that, viewed as a whole, they are to be regarded as “Other goods made of plastic — electric indoor lights”.The defendant admits that the flashing light circles may possibly be used as Christmas-tree decorations but it takes the view that they are used in Germany mainly as decorative lights for other purposes. However, it concedes that their principal use within the European Communities might possibly be different and determinative.The order of 29 September 1980 referring the matter to the Court was received at the Court Registry on 20 October 1980.In accordance with Article 20 of the Protocol on the Statute of the Court of Justice of the EEC written observations were submitted by the Commission of the European Communities, represented by its Legal Adviser, Rolf Wägenbaur, on 19 December 1980.Upon hearing the report of the Judge-Rapporteur and the views of the Advocate General the Court decided to open the oral procedure without any preparatory inquiry.However, it requested the parties to the main action and the Commission to reply in writing to a question concerning the possibility of considering the goods in question as “carnival... [and] entertainment articles” under tariff heading 97.05, and the Commission did so within the prescribed period.
The Commission of the European Communities argues that in view of the presentation of the “flashing light circles” and especially of the fact that they are decorated with silver tinsel in the form of fir-tree branches it cannot be ruled out that the goods were designed by the manufacturer to be used as Christmas-tree decorations.According to the Commission that theory is confirmed by the fact that the goods have a casing which enables the light circle to be attached to the top of a fir tree and it is borne out by the fact that the manufacturer had such use in mind, as is disclosed by a reading of the brochure attached to the sample included with the documents placed before the Court.The Commission believes that the “flashing light circle” may in fact occasionally be actually used as a Christmas-tree decoration.However, the Commission thinks that owing to the way in which the article is presented (at least on the European market) it is, on the contrary, generally used “at parties” in accordance with the view taken by the Zentralverband der Elektrotechnischen Industrie e.V. and the Vereinigung Bayerischer Spielwarenund Christbaumschmuckhersteller e.V. [National Federation for the Electronic Industry and Association of Bavarian Manufacturers of Toys and Christmas Tree Decorations].In order that the goods in question may be classified under tariff heading 97.05 of the Common Customs Tariff it is not sufficient in the Commission's view that they are used occasionally as Christmas tree decorations. They must be an article which is used primarily as a Christmas-tree decoration.The Commission points out that the goods in question are not included in any of the tariff headings of the Common Customs Tariff. They are “goods consisting of more than one material or substance”, within the meaning of Rule 2 (b) of the General Rules for the Interpretation of the Nomenclature of the Common Customs Tariff, consisting of a plastic frame with synthetic decoration and electrical fittings in which are fixed the candle-shaped incandescent light bulbs without sockets.According to the last sentence of the above-mentioned Rule 2 (b) the procedure to be applied is that of Rule 3 (b) (Rule 3 (a) not being relevant), which provides that “goods consisting of... different components” should “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”. Bearing in mind the external appearance of the goods on the one hand and their function on the other, consisting of lighting up at regular intervals when the electricity is switched on thereby producing a decorative effect, it is the plastic lighting equipment which must be regarded as tne component which gives the goods their essential character.The Commission therefore concludes in favour of classifying the “flashing light circles” under tariff subheading 39.07 EIV of the Common Customs Tariff and proposes the following answer to the question put by the Finanzgericht Berlin :“So-called ‘flashing light circles’ consisting of a plastic frame to which are attached incandescent light bulbs of different colours which flash when an electrical current is passed through them must be classified under tariff subheading 39.07 E IV”.
The Court, by letter of 23 February 1981, asked the Commission whether the goods in question might be considered as coming under tariff heading 97.05 of the Common Customs Tariff as “Carnival articles; entertainment articles (for example, conjuring tricks and novelty jokes)” and the Commission replied in the negative on 13 March 1981. According to the Commission tariff heading 97.05 covers carnival articles and entertainment articles intended for ephemeral use, flimsy and of simple construction, not to be confused with articles in ordinary use of which they are an imitation. The “flashing light circles” are lighting equipment which may be used for example as decorations for a private bar or similar installation and for shop windows or exhibition halls. Their manufacture is such as to make it appear that they are not designed for ephemeral use but intended to be used over a period of time, either permanently or at repeated intervals as lighting equipment. They cannot therefore be regarded as novelty jokes or the like and consequently cannot, in the Commission's view, come under tariff heading 97.05.
The Commission of the European Communities, represented by Rolf Wägenbaur, a member of its Legal Department, acting as Agent, presented oral argument at the sitting on 26 March 1981.The Advocate General delivered his opinion at the sitting on 4 June 1981.
The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main action are concerned, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court.
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