Hauptzollamt A v. Segelbootwartung

Repair without use: Whether national practice can levy import VAT where means of transport is ‘subsequently subjected to maintenance and repair work, before being re-exported outside the customs territory of the Union without having been used as a means of transport’ [26] under Article 2(1)(d) and Article 30 of Council Directive 2006/112/EC.

Hauptzollamt Braunschweig (Place where VAT is incurred – III), C-791/22 on presumption of import VAT on customs duties applied: VAT due where ‘it can be presumed that the goods entered the economic network of the European Union and that they may have undergone consumption’ [32]. Federal Express Corporation Deutsche Niederlassung, C-26/18.

1. 2.1

   Federal Express Corporation Deutsche Niederlassung, C-26/18 on breaches of customs rules applied: ‘breaches of customs regulations alone do not, in themselves, constitute sufficient grounds for concluding that the goods in question have actually entered the economic network of the European Union.’ [35]

2. 2.2

   Presumption rebuttable: Presumption ‘may be rebutted where the person who unlawfully introduced goods into the customs territory of the Union establishes, on the basis of objective and verifiable evidence, that those goods were not intended for consumption or use within that territory.’ [38] Hauptzollamt Münster (Place where VAT is incurred), C-7/20 and Hauptzollamt Hamburg (Place where VAT is incurred – II), C-368/21 [36].

3. 2.3

   Dansk Transport og Logistik, C-230/08 on seized cigarettes distinguished: Cigarettes ‘by their very nature and in the light of the circumstances of their introduction, intended for consumption within the territory of the Union.’ [57] Kauno teritorinė muitinė, C-489/20.

Actual use interpreted: ‘for such use to be regarded as “actual”, it must enable the property to be utilised in accordance with its specific function or intended purpose. By contrast, the mere fact that that means of transport is present within the territory of the Union or that it is the subject of operations intended to render it fit for such use is not sufficient’ [44].

1. 3.1

   Repair not use: Repair and maintenance before re-export ‘cannot be regarded as constituting actual use of that means of transport within the customs territory of the Union.’ [52]

2. 3.2

   VAT on repair irrelevant: Repair services ‘must be regarded as transactions distinct from the importation of the sailing boat, even if that work resulted in an increase in its value.’ [51]

3. 3.3

   X, C-84/09 on place of use of means of transport applied by analogy: Account taken of ‘the circumstances in which the transport of the goods took place over time, the place of residence of the owner or holder, the place where the goods are normally used, and the existence or absence of links which that owner or holder maintains’ with the Union and third countries [41].

Repair without authorisation: Whether national practice can treat maintenance and repair work as use of goods ‘where that work was not authorised as a processing operation under the inward processing procedure.’ [59] under Article 124(1)(k) of Regulation (EU) No 952/2013.

Article 124(1)(k) of Regulation (EU) No 952/2013 (Union Customs Code) on extinction of customs debt interpreted purposively; Combinova, C-476/19 applied: ‘goods that have been used’ covers ‘not all use but only such use giving rise, on its own, to a customs debt’ [63]. Palmstråle, C-125/24.

1. 6.1

   Hypothetical authorisation sufficient: Operation with ‘the characteristics of a transaction that could have been authorised under the inward processing procedure … cannot be classified as use’ [66]. Conditions for retroactive authorisation under Article 211(2) of the Customs Code ‘must also be met where a court is required to assess retrospectively whether certain transactions could have been authorised’ [70].