JUDGMENT OF 17. 6. 1971 — CASE 3/71 BAGUSAT v HAUPTZOLLAMT BERLIN

In Case 3/71 Reference 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 between

THE COURT composed of: R. Lecourt, President, A. M. Donner and A. Trabucchi, Presidents of Chambers, R. Monaco, J. Mertens de Wilmars, P. Pescatore (Rapporteur) and H. Kutscher, Judges, Advocate-General: A. Dutheillet de Lamothe Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

I — Facts and procedure

Between 15 and 24 September 1969 Gebrüder Bagusat KG, a limited partnership, submitted to the Berlin-Spandau Customs Office nine applications each for the customs clearance and release into free circulation of 75 barrels of morello cherries in spirit with no added sugar which were imported from Yugoslavia and the total contents of which weighed 14999 kg.

The Berlin-Packhof Principal Customs Office granted customs clearance and adopted for the tariff classification tariff subheading 20.06B (e) 2 stated by the importer. By means of provisional notices of assessment it claimed, on the basis of a 32 % rate of duty, payment of DM 56546.10 customs duty, DM 215529.20 excise duty and DM 24965.30 import turnover tax.

An examination of the samples taken when customs clearance was granted by the Zolltechnische Prüfungs- und Lehranstalt showed that the imported goods all had a sugar content of 14.4 % by weight measured by refractometry.

On the basis of the analyst's report from the Zolltechnische Prüfungs- und Lehranstalt, the Berlin-Packhof Principal Customs Office applied Additional Note No 1 to Chapter 20 of the Common Customs Tariff annexed to Regulation No 950/68 of the Council of 28 June 1968 on the Common Customs Tariff (O.J. 1968 L 172, p. 1), whereby the content of various sugars expressed as sucrose is considered as the ‘sugar content’; it also applied Additional Note No 2 to the same chapter, whereby products classified under heading 20.06 are considered as ‘containing added sugar’ when the ‘sugar content’ thereof exceeds 9 % by weight, with regard to kinds of fruit other than pineapples and grapes. It accordingly decided to classify the imported products under tariff subheading 20.06 B (e) 1 of the Common Customs Tariff (‘other fruits with a sugar content exceeding 9 % by weight’), which is subject to a levy system.

By final notices of assessment of 16 and 20 October 1969 the Berlin-Packhof Principal Customs Office claimed from Gebrüder Bagusat payment by way of levy of an additional sum of DM 3604.90 calculated in accordance with the rules laid down by Regulation No 865/68 of the Council of 28 June 1968 on the common organization of the market in products processed from fruit and vegetables (OJ 1968 L 153, p. 8).

Gebrüder Bagusat lodged a complaint against these assessments, which was rejected by a decision of the Berlin-Packhof Principal Customs Office of 30 June 1970. Gebrüder Bagusat appealed against that decision to the Finanzgericht, Berlin.

The Third senate or the Finanzgericht, Berlin, considering that the determining factor in deciding the case was whether the expression ‘sugar content’, within the meaning of subheading 20.06 B I (e) 1 of Regulation No 950/68, refers only to sugars artificially added to products resulting from fruit processing, or whether it also extends to natural sugars which have not been added, where the proportion of the latter exceeds 9 % by weight, by order of 12 January 1971, registered at the Court Registry on 26 January 1971, stayed the proceedings in accordance with Article 177 of the EEC Treaty and referred the following questions to the Court for a preliminary ruling:

a) May Article 2 of Regulation No 865/68 in conjunction with Article 9 of that regulation and with the provisions of the Common Customs Tariff (Additional Note 2 to Chapter 20, tariff heading 20.06 B I (e)) be interpreted as meaning that when the sugar content established by refractometry exceeds 9 % by weight it is necessary to consider that there is ‘added sugar’, or must it be considered that in accordance with Regulation No 865/68 the goods (in this case, morello cherries in spirit) can be subject to the levy only if sugar has in fact been added to them?

b) On the assumption that a sugar content in excess of 9 % by weight must be regarded as ‘added sugar’ within the meaning of Regulation No 865/68, and that it is irrelevant whether sugar has in fact been added, is this rule compatible with the objectives of Regulation No 865/68?

c) If the answer to the second question is in the negative, does it follow from the incompatibility thus established that there has been an infringement of Community law such as to make it impossible to impose the levy, or must that levy nevertheless be imposed despite the fact that such was not the intention of the Community legislature?

Under 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 on 4 April 1971, and by the plaintiff in the main action on 6 April 1971.

After hearing the report or the Judge-Rapporteur and the views of the Advocate-General, the Court decided to open the oral procedure without a preparatory inquiry.

The plaintiff in me mam action ana the Commission presented oral argument at the hearing on 6 May 1971.

The Advocate-General delivered his opinion at the hearing on 27 May 1971.

In the procedure before the Court, the plaintiff in the main action was represented by Dietrich Ehle, Advocate of the Cologne Bar, and the Commission by its Legal Adviser, Peter Gilsdorf.

II — Observations submitted to the Court

The written and oral observations submitted to the Court may be summarized as follows:

A — The first question

Gebrüder Bagusat, a limited partnership, the plaintiff in the main action, contests that the Council was able in Regulation No 950/68 to give a binding interpretation of the concepts defined in Article 2 of Regulation No 865/68. Article 9 (2) of Regulation No 865/68 provides that ‘the tariff nomenclature resulting from application of this Regulation shall be incorporated in the Common Customs Tariff.’ The provisions concerning the tariff nomenclature of the organisations of the agricultural markets are special rules in comparison with the general rules contained in the Common Customs Tariff. This special nature follows from the actual contents of Regulation No 865/68 and from the greater detail of the rules which it lays down; it follows above all from Article 38 (2) of the EEC Treaty: whilst the provisions conceming the customs tariff laid down in Regulation No 950/68 are based on Articles 28 and 111 of the Treaty, the tariff nomenclature laid down in Article 1 of Regulation No 865/68 is based on the special provisions laid down in Articles 40 and 43. The interpretation of the question concerning tariff classification raised in the present case is therefore essentially linked to Regulation No 865/68.

The parties in the main action agree that no sugar has been added to the morello cherries in spirit imported by Gebrüder Bagusat. The provisions of Regulation No 865/68 taken as a whole establish that only added sugar can give rise to the imposition of a levy. Thus Article 2 (1) provides for a levy on ‘the various added sugars’; the definition of ‘added sugar content’ given in the second paragraph of Article 2 (3) refers not to the ‘sugar content’, but expressly to the ‘added sugar content’. It follows that the method of measuring by refractometry is applicable only when sugar has been added to the original product. That finding is confirmed by the first paragraph of Article 2 (3) and by Article 2 (4): these two provisions concern the added sugar content. Furthermore the declaration of the importer concerning the sugar content has not been prescribed by Article 4 (2) of the Regulation except in cases where sugar has actually been added to the imported product.

That opinion is shared by the Finanzgericht, Hamburg and the Finanzgericht, Baden-Württemberg in decisions of 17 October 1969 and 11 February 1970 respectively.

No other interpretation or the provisions can be deduced from tariff heading 20.06 B I (e) in conjunction with Additional Note No 2 to Chapter 20 of the Common Customs Tariff. In fact Additional Note No 2 applies also to fruit ‘containing added sugar’. In any case the provisions on tariff classification laid down in Regulation No 950/68 are the most general source of law and that to which exceptions may be made.

As for the intentions or the community legislature, the plaintiff in the main action refers particularly to the reply given by the Commission on 21 October 1970 to a written question from a member of the European Parliament and from which it appears that it was concerned ‘to avoid imports of fruit juices with a strong concentration of natural sugar, but which contain no added sugar, from being subject to a levy which ought to be imposed only on imports of juice containing added sugar. In respect of preserved fruit, its import is subject to the imposition of the levy, since this product contains added sugar’.

Consideration or the purposes of Regulation No 865/68 supports that interpretation: they are to prevent the common organization of the market in sugar from being affected by the import, without the imposition of a levy, of sugar added to fruit and vegetable products during processing. The object of Article 2 of the Regulation, in accordance with the third recital of the preamble thereto is to ensure that ‘a levy is charged on the sugar component incorporated in processed products under conditions similar to those operative under Council Regulation No 1009/67’ on the common organization of the market in sugar.

The system or the legal fiction in conjunction with amending regulations used by the Commission is self-contradictory, leads to discrimination and hampers trade with third countries in an unjustified manner. On the contrary a system of mere presumption which allows evidence to the contrary is perfectly adequate and practicable; it is possible to check whether sugar has been added to products processed from fruit.

It therefore ensues from an interpretation of the wording, the objectives and the whole of the system into which Regulation No 865/68 fits, that the refractometric method is only applicable, that the fiction system is only valid and that a levy can only be imposed in cases where sugar has been added to the imported product.

The Commission of the European Communities analyses Regulation No 865/68 in detail and points out in particular that it provides two different methods for calculating the levy imposed on the sugar component of products processed from fruit and vegetables:

a) The fixed method (Article 2 (2)) is based on fixed average coefficients of sugar content for the various products mentioned in Column 1 of Annex I to the Regulation; the amount of the levy is determined for 100 kg net of imported products, by multiplying this average coefficient — regarded as corresponding to the added sugar content — by the levy applicable to sucrose.

b) The ‘individualized’ method (Article 2 (3) and (4)) is based on finding the total sugar content by using the method of measuring dry soluble residue in products processed from fruit and vegetables by refractometry (described in Annex HI to the regulation), taking into account a technical correction factor; the added sugar content is considered as the difference between the figure obtained by the method of measuring by refractometry and the figure appearing in column 2 of Annex I, the latter being regarded as corresponding to the natural sugar content. The amount of the levy is determined by multiplying that difference by the levy applicable to sucrose.

It appears from Article 2 (2) that tor the calculation of sugar content, the fixed method is the rule, the individualized method being used only if the results of the two methods show disparities which are too great. In practice, the customs authorities know by experience in respect of the great majority of imported processed products the ‘normal’ disparity so that the choice of method does not necessarily depend upon the result of a previous analysis.

The figures appearing in Annex I to the Regulation are fixed average coefficients based on current experience and were laid down in accordance with the opinion of scientific and administrative experts of the Member States. The need to group certain products into categories led to the fixing of average coefficients, which has the result that relatively large differences may be produced in comparison with the values which are obtained by having recourse to a purely individual measurement.

The link between Regulation No 865/68 and the rules of the Common Customs Tariff applicable to the present case is defined in Article 9 of the Regulation.

The first sentence or Article 9 (1) provides that the Common Customs Tariff shall be applied to the products listed in Article 1 of the regulation; that provision serves only as a reminder, since the applicability of the Common Customs Tariff follows directly from Regulation No 950/68.

Article 9 (2) has a twofold meaning: the second sentence of this paragraph shows that the tariff nomenclature consequent upon the application of the regulation is re-enacted in the Common Customs Tariff, which has been the case since 1 July 1968, the date on which Regulations Nos 865/68 and 950/68 entered into force; the first sentence of the same paragraph provides that the general rules for the interpretation of the Common Customs Tariff and the special rules for its application shall apply to the tariff classification of the products covered by that regulation. Among these special rules appears in particular the Additional Note to Chapter 20 of the Common Customs Tariff. In other words, the customs nomenclature which follows the application of Regulation No 865/68 was taken from this regulation and is now subject to the rules of tariff classification and interpretation provided in customs law.

Subheading 20.06 B I (e) 1 mentions ‘fruit with a sugar content’ and not, as is the case for products under subheading B II, fruit ‘containing added sugar’. It is not possible to equate the expression ‘with a sugar content’ under subheading B I (e) to the expression ‘added sugar’; in fact Additional Note No 2 to Chapter 20 provides that:

‘The products classified under heading 20.06 shall be considered as “containing added sugar” when the “sugar content” thereof exceeds by weight the percentages given hereunder, according to the kind of fruit concerned: pineapples and grapes 13 %; other fruit, including mixtures or fruit 9 %’.

That note contains a legal definition of the expression ‘added sugar’ and rules out any other interpretation of the latter; in other words it constitutes a legal fiction automatically excluding evidence to the contrary.

That fiction, however, is or direct significance only for the classification of the product in the customs nomenclature; the Commission, unlike the defendant in the main action, is not of the opinion that the Additional Notes to Chapter 20 have become an integral part of Regulation No 865/68 and the legal definition contained in the Common Customs Tariff must automatically be extended to that regulation. What is important is the interpretation of Regulation No 865/68 itself.

On this point, the (commission considers that there is added sugar within the meaning of Regulation No 865/68, whenever the sugar content measured by refractometry exceeds 9 % by weight.

It is indeed true that Article 2 (1) of Regulation No 865/68 mentions ‘added’ sugars. Nevertheless paragraph (3) of that article to which paragraph (4) refers, defines the expression ‘added sugar content’ as the reading obtained by using refractometer (total sugar content), reduced by the figure appearing in column 2 of Annex I (presumed natural sugar content). The legal fiction thus created cannot be interpreted restrictively: such an interpretation is in clear contradiction with the fact that the basis of the application of the levy is formed, not by the sugar content indicated by the refractometer but by the content obtained after deduction of the presumed quantity of natural sugar. The fiction created by the second paragraph of Article 2 (3) is founded on the theoretical figures contained in column 2 of Annex I. The fact that the legislature itself prescribed this deduction logically excludes any limitation of the provision laid down in the second paragraph of Article 2 (3), and in consequence, of the abovementioned legal fiction in cases where sugar has actually been added.

The legal presumption in question applies equally to the fixed method, since coefficients laid down thereby express the presumed added sugar content. The application of the fixed method enables therefore, even more than the individualized method, a sugar content which in fact has not been added to be subjected to a levy. If the legislature foresaw the possibility in the case of Article 2 (2) of making a natural sugar content subject to a levy, it is not contrary to the logic of the system that it also accepted this possibility in the method of calculation defined in paragraphs (3) and (4) of that article.

Furthermore, the practical implementation of the regulations concerned can be ensured only by this means.

It is impossible to establish with certainty whether the sugar contained in imported products is natural sugar or added sugar by having recourse only to chemical analysis; the admission of other evidence (a declaration by the importer, sampling or an official declaration by the exporting third country) generally encounters insurmountable difficulties.

Replacing the legal fiction by a presumption juris tantum would not be a practical solution either and would endanger Community rules. The mere possibility for the importer in exceptional cases to adduce evidence that the sugars contained in a particular product are natural sugars, does not justify the adoption or the authorization, instead of a method of calculation based on a legal fiction, of a method based on the concrete ascertainment of the added sugar content, the less so since it would affect several tariff headings.

In conclusion, the Commission proposes that the following reply should be given to the first question: ‘The definition of the expression “added sugar content” which appears in the second paragraph of Article 2 (3) of Regulation No 865/68 is applicable whether or not sugar has actually been added in whatever proportions’.

B — The second question

The limited partnership Bagusat is of the opinion that the second question put by the order of reference, seen in conjunction with the third, raises a question of interpretation which may be expressed thus: if, in accordance with Regulation No 865/68, it is of no importance whether or not sugar has actually been added to the product, may a levy be imposed even if the latter is contrary to the objectives pursued by the regulation?

This question must be examined starting from the viewpoint that there is a lacuna in the regulations which it is for the courts to fill.

According to the concepts of German law, there is a lacuna in a law and the court may fill it, when it may be concluded that the legislature, if it had envisaged the case, would have made provision for it, in accordance, for example, with the rules adopted for a case which is analogous in fact or in law.

Evidence that Regulation No 865/68 shows a real lacuna in respect of the levy system applicable to fruit and concentrated fruit juice without added sugar is provided in particular by the regulations adopted in amendment of Regulation No 865/68; although they are entitled ‘Regulations amending Regulation No 865/68’, they only supplement the former in application, furthermore, of the principle that the natural sugar content of a fruit product must not be subject to the levy.

To fill this lacuna, recourse must be had to the objectives of Regulation No 865/68 and to its meaning within the framework of the organization of the agricultural markets. However, the purpose of the regulation is merely to prevent importation without levy of the raw material ‘sugar’ as a constituent incorporated into products processed from fruit and vegetables.

In respect of the second question the Commission adds to the considerations put forward with regard to the first question, the following arguments which they claim also establish that the rules in question are compatible with the objectives of Regulation No 865/68:

The tact that the objective or Regulation No 865/68 was to subject added sugars to the levy does not prevent the machinery for the organization of the market set up to attain this from being capable of leading in certain cases to the application of the levy to sugars which have not been added. This is an inevitable consequence of a method of calculation founded on the use of averages and necessarily based on a fiction. The view that the wording and the objective of Regulation No 865/68 imply that a levy should be imposed only when the products have actually had sugar added, disregards these inevitable restraints and confuses the ratio legis and the method chosen by the Community legislature; that method must certainly correspond to the objective pursued by the regulations in question but its effects need not necessarily coincide with all the purely logical consequences following from that objective.

The fact that a method of calculation was chosen which was likely to lead in certain cases to the application of a levy to sugars which have not been added, is not contrary to the objective of the regulation. That method, in view of practical requirements, is the nearest possible to reality without resulting in too great complexity in relation to its practical use. The fact that in certain circumstances, especially at harvest time in a particularly good year from the climatic point of view, morello cherries may show a high sugar content, does not invalidate the presumption in law, which only recognizes a maximum natural sugar content of 9 % by weight for this fruit. Such a difference is entirely within the framework of the normal consequences of the application of a fixed system. The legislature cannot be required to perfect the system to such an extent that each variety of fruit corresponds to a particular tariff subheading and a presumed percentage of natural sugar content.

C — The third question

The limited partnership Bagusat is of the opinion that the third question should be interpreted as including a total assessment of the validity of the levy system established by Regulation No 865/68 as concerns tariff heading 20.06 B I (e).

a) With regard to the requirements of Article 190 of the EEC Treaty, Regulation No 865/68 is properly reasoned: it appears clearly from the recitals in the preamble thereto that only the constituent ‘added sugar’ is subject to a levy, in order to make the rules on the sugar market effective. This implies that the natural sugar contained in the products covered by that organization of the market must not be subject to any levy. Furthermore, the recitals in the preamble to Regulation No 865/68 very clearly prohibit morello cherries in spirit without added sugar from being subject to the levy because of their high natural sugar content; the imposition of a levy on these products is contrary to the duty to give reasons laid dawn in Article 190 of the Treaty.

b) That imposition is also contrary to the prohibition on discrimination:

Cherries imported in other forms (tariff headings 08.07 and 08.11 of the Common Customs Tariff) are subject to customs duty of a maximum of 16 % without a levy; morello cherries preserved in spirit are subject to customs duty of 32 % and to a high levy on the sugar.

As opposed to what has happened with regard to concentrated fruit juices and purees, no regulations have been made supplementing Regulation No 865/68 in respect of morello cherries in spirit.

c) The imposition of a levy on cherries in spirit without added sugar further violates the principle, which is also in force in Community law, that the means used must be proportional to the objective to be achieved. It is quite possible to establish by means of chemical investigation whether the imported products contain only natural sugar or also added sugar. Further, in the present case the legal limits placed on the implementation of a fiction or irrebuttable presumption are disregarded. Complete generalization on the basis of a typical case which makes it impossible to bring evidence to the contrary can be accepted only in a very limited number of cases. The legislature has no right in order to simplify control, to accept assumptions which do not correspond to reality as it appears normally in practice; in cases where it is particularly difficult to bring evidence, it could resort at most to what is called incomplete generalization on the basis of a typical case, which would lead to a reversal of the burden of proof.

d) According to Article 18 or Regulation No 865/68 the latter must be so applied that appropriate account is taken, at the same time, of the objectives set out in Articles 39 and 110 of the Treaty. However, the objectives or Article 39 are not in any way called in question by the importation without levy of morello cherries in spirit without added sugar, marasca cherries, which are particularly suitable for the chocolate industry and are not produced within the Community. On the contrary, supply to consumers at reasonable prices which Article 39 (1) (e) gives as the aim of the Common Agricultural Policy prohibits cherries in spirit without added sugar from being subject to a levy. The imposition of a levy on morello cherries in spirit without added sugar also violates the principle of trade with third countries which is free and therefore not subject to levies, as laid down in Article 110 of the Treaty.

e) Lastly, it should be pointed out that the multilateral convention concluded within the framework of the Conference on Trade held from 1964 to 1967 in Geneva which the Council signed for the Community, by a decision of 27 November 1967, reserved to the Community the right to levy in addition to the bound customs duty an additional duty corresponding to the import charge on sugar; heading 20.06 B I is exempt from the reservation and it follows from this that no levy may be imposed on products under that heading.

The Commission, although it appears to it superfluous to reply to the third question, since it is raised only if the reply to the second question is in the negative, puts forward the following observations as to the validity of Regulation No 865/68:

a) T he method of calculation laid down by the regulation and its form are mere procedures and consequently require no special reasons to be given. The reasons given as the basis of the regulation in question satisfy the requirements laid down by the Court: the choice of a method of calculation which prescribes recourse to fixed rates and necessarily results in differences from real values is in no way so unusual that a special mention would have had to be made of it in the statement of the reasons on which the regulation is based.

b) To raise the objection of discrimination is problematical within the framework of tariff law: customs duties are not fixed according to proper scientific methods, but are the culmination of a long historical process. In the present case, furthermore, there is no discrimination:

with regard to cherries imported as fresh fruit (tariff heading 08.07) or in the form of fruit provisionally preserved but unsuitable for consumption in that state (tariff heading 08.11), sugar may not be added; they are therefore products to which it is objectively justified to accord treatment different from that accorded to morello cherries in spirit.

Concentrated fruit juices and purees are products which, in relation to the external trade of the Community, are of much greater importance than morello cherries in spirit; because of this a special solution for these products cannot amount to discrimination. Furthermore, the difference between the real and the presumed natural sugar content is much smaller for morello cherries than for concentrates; the difference found to exist between the presumption and reality justified special rules for the latter.

c) The means prescribed by Regulation No 865/68 are in proportion to its objective. The method of calculation which it prescribes is appropriate; the average values of the sugar content of morello cherries have been fixed in accordance with an essential and reasonable standard.

d) Products under heading 20.06 B I represent only a small fraction of the processed products coming within Regulation No 865/68 and are relatively unimportant in terms of trade. On the other hand the Community legislature has taken account in the choice of method of the requirements of international trade and of the interests of the Member States.

e) The commitments governed by international law which were entered into by the Community within the framework of GATT cannot confer particular rights for private individuals. In any case the Community made no concession as regards tariff heading 20.06 B I: the latter does not include either a bound customs duty or a bound restriction on the imposition of a levy on sugar in the future.

Grounds of judgment

1. By order of 12 January 1971, received at the Court on 26 January 1971, the Finanzgericht, Berlin, has asked the Court, under Article 177 of the EEC Treaty, to give a preliminary ruling on certain questions concerning the interpretation and validity of Regulation No 865/68 of the Council of 28 June 1968 on the common organization of the market in products processed from fruit and vegetables (OJ English Special Edition 1968 (1) p. 225).

The first question

2. The first question asks whether Article 2 of Regulation No 865/68, in conjunction with Article 9 of that regulation and with the rules on the Common Customs Tariff (Additional Note No 2 to Chapter 20, tariff heading 20.06 B I (e), may be interpreted as meaning that when the sugar content of the imported product, in this case of cherries in spirit, ascertained by refractometry exceeds 9 % by weight it must be considered that they contain ‘added sugar’, or whether the levy may be imposed only if sugar has in fact been added.

3. Under Article 2 (1) of Regulation No 865/68 a levy ‘on the various added sugars’ may in certain circumstances be imposed in addition to the customs duty which can be demanded under this regulation. This levy is determined in accordance with the conditions laid down by paragraphs (2) to (6) of the same Article, including Annexes I and III, which respectively lay down fixed sugar contents and a method of analysis whereby in certain circumstances the true sugar content can be determined by way of exception to the fixed values. Article 9 (2) of the same Regulation provides moreover that ‘The general rules for the interpretation of the Common Customs Tariff and the special rules for its application shall apply to the tariff classification of the products covered by this Regulation’. Under Additional Note No 2, appearing at the head of Chapter 20 of the Common Customs Tariff fixed by Regulation No 950/68 of 20 June 1968 (OJ L 172, p. 86), ‘The products classified under heading No 20.06 shall be considered as “containing added sugar” when the “sugar content” thereof exceeds by weight the percentages given hereunder, according to the kind of fruit concerned:… other fruits … 9 %’.

4. The plaintiff in the main action claims that the levy prescribed by Article 2 (1) of Regulation No 865/68 is applicable only if sugar has in fact been added to the product in question. According to the view of the customs authorities, put forward before the national court and supported by the Commission before the Court, the standard methods established by Regulation No 865/68, in conjunction with the abovementioned Additional Note to the Common Customs Tariff, created a legal fiction or presumption according to which any sugar content, even if natural, must be regarded as ‘added sugar’ as soon as the proportion of sugar exceeds the percentage specified.

5. The preamble to Regulation No 865/68 states that the aim of Article 2, which introduces a levy on ‘added sugar’, is to ensure that the trading system for certain products processed from fruit is brought into line with that laid down for sugar itself, so that the sugar incorporated into processed products is subject to a levy under conditions similar to those applied within the framework of the common organization of that market. Hence, it would be incompatible with the system adopted by Regulation No 865/68 if the natural sugar content of products processed from fruit were subjected to the levy. This conclusion follows from Article 2 (1) which provides that the basis of charge of the levy is not the sugar content, but the ‘various added sugars’. In view of this provision, paragraph (2) et seq. of the same article can only be intended to fix, for cases in which sugar has in fact been added, details of the application of the levy and its amount. Hence it is impossible to see in these provisions an irrebuttable presumption which enables natural sugar, in so far as the percentage thereof exceeds the levels defined under the fixed assessments or the methods of analysis laid down by the provisions in question, to be regarded as added sugar.

6. This interpretation is not affected by Additional Note No 2 to Chapter 20 of the Common Customs Tariff, since this provision, incorporated in a regulation concerning customs duties, cannot alter the basis of charge of an agricultural levy, especially since it is referred to by Article 9 (2) of Regulation No 865/68 only for the purposes of ‘tariff classification’ of the products to which the regulation relates. Accordingly, this additional note can have no other purpose except to give guidance, on the basis of the total sugar content, to facilitate the tariff classification of products within the category of fruit subject either to a customs duty and a levy, or to a customs duty alone. In view of the provisions of Regulation No 865/68, the effect of that note is to establish that products with a sugar content of less than 9 % are exempt from the levy, whilst creating, in the case of products with a higher sugar content, a presumption with regard to classification against which evidence in rebuttal may be brought. When such a product has a sugar content exceeding 9 %, it is therefore open to the importer to prove, where appropriate, that it contains only natural sugar.

7. The answer must therefore be given that the provisions of Article 2 of Regulation No 865/68, in conjunction with Additional Note No 2 to Chapter 20 of the Common Customs Tariff, to which reference is made by Article 9 of the same regulation, subject to the levy only those products processed by the actual addition of sugar, but that if the sugar content of a product corning under tariff heading 20.06 B I (e) exceeds 9 %, it is for the importer to prove that the product contains only natural sugar.

The second and third questions

8. The second and third questions are put on the assumption that a sugar content exceeding 9 % by weight must, as a matter of law, be deemed, without its being permitted to bring evidence in rebuttal, to constitute ‘added sugar’ within the meaning of Regulation No 865/68.

9. In view of the answer given to the first question, these two questions no longer have any purpose.

Costs

The costs incurred by the Commission of the European Communities, which submitted observations to the Court, are not recoverable and as these proceedings are, in so far as the parties to the main action are concerned, a step, in the action pending before the Finanzgericht, Berlin, the decision on costs is therefore a matter for that court.

On those grounds, Upon reading the pleadings; Upon hearing the report of the Judge-Rapporteur; Upon hearing the oral observations of the plaintiff in the main action and the Commission of the European Communities; Upon hearing the opinion of the Advocate-General; Having regard to the Treaty establishing the European Economic Community, especially Article 177; Having regard to the Protocol on the Statute of the Court of Justice of the European Economic Community, especially Article 20; Having regard to the Rules of Procedure of the Court of Justice of the European Communities, THE COURT in answer to the questions referred to it by the Finanzgericht, Berlin, by order of that court of 12 January 1971, hereby rules: