Territorial disputes: Northern Ireland (Part 17) [Post 102]

The post yesterday included another freedom related to European Union law: free movement of goods. This is of particular importance for the United Kingdom in light of Brexit (and therefore, Northern Ireland).

Free movement of goods would not work if there were barriers. Therefore, European Union law prohibits financial and non-financial barriers to free movement of goods. In brief:

Financial barriers

The applicable law arts 28-30 TFEU refers to the prohibition of customs duties and charges having equivalent effect (CEEs).

Art 110 TFEU refers to the prohibition of discriminatory internal taxation.

Relevant case law (European Court of Justice).

 

Non-financial barriers

The applicable law arts 34-36 TFEU.

Relevant case law (European Court of Justice).

 

 

Financial barriers

Customs duties and CEEs (arts 28-30 TFEU)

 

Art 28 TFEU:  requires the creation of a customs union between member states. 

It means that (i) internally (free trade area)there is a  prohibition of customs duties and charges having equivalent effect (CEEs) between member states on imports and exports; and (ii) externally, the adoption of a common customs tariff (CCT) on goods imported from third countries.  Art 28 TFEU requires removal of existing customs duties and CEEs.

 

What is a custom duty/ CEE? A charge (payment of money) imposed/collected on goods because they cross a border. 

 

Art 29 TFEU: goods in “free circulation” are goods from third countries which have paid CCT on entry to the European Union. Once inside the European Union, having paid the CCT, they must be treated as goods originating from within the European Union.

 

Art 30 TFEU: prohibits imposition of new customs duties and CEEs on imports and exports. 

 

Finally, a CEE: the definition can be found in Commission v Italy (Statistical Levy Case) 24/68 refers to “any pecuniary charge.” The purpose of duty/ charge is irrelevant. The effect is what counts.

 

Once customs duty or CEE are found within the scope of Art 30 TFEU the customs duty is unlawfull. Some charges may be permissible. For example, charges made for provision of genuine commercial service to importer Warehouse Case 132/82; charges levied on importer/exporter for inspection which mandatory under European Union or international law Commission v Germany Case 18/ 87.

 

The post tomorrow will introduce discriminatory internal taxation to complete the picture about financial barriers. On Thursday and Friday, the posts will highlight the key elements referred to non-financial barriers.

 

Jorge Emilio Núñez

Twitter: @London1701

17th July 2018

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