Avis juridique important

Judgment of the Court of 8 November 1990. - Krystyna Gmurzynska-Bscher v Oberfinanzdirektion Köln. - Reference for a preliminary ruling: Bundesfinanzhof - Germany. - Preliminary rulings - Jurisdiction of the Court - Reference by national legislation to provisions of Community law - Common Customs Tariff - Headings 8306, 9701 and 9703 - Classification of a work of art. - Case C-231/89. European Court reports 1990 Page I-04003

Summary Parties Grounds Decision on costs Operative part

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1 . Preliminary rulings - Jurisdiction of the Court - Limits - Spurious dispute or request for an interpretation of Community provisions which are not applicable to the main proceedings - Interpretation requested by reason of the applicability of a provision of Community law owing to a reference thereto incorporated into national law - Jurisdiction to give such an interpretation

( EEC Treaty, Art . 177 )

2 . Common Customs Tariff - Headings - Criteria for distinguishing between Heading 9701 and Heading 9703

1 . In the division of functions in the administration of justice between national courts and the Court of Justice provided for by Article 177 of the Treaty the Court of Justice gives preliminary rulings without, in principle, having to examine the circumstances in which the national courts have been led to refer questions and propose to apply the provision of Community law which they have asked the Court to interpret .

It would be otherwise only in cases where either it appears that the procedure of Article 177 of the Treaty has been misused and been resorted to, in fact, in order to elicit a ruling from the Court in the absence of a genuine dispute or it is obvious that the provision of Community law submitted for the interpretation of the Court cannot apply .

That is not so if the Court is asked to interpret a provision of Community law which the national court is bound to apply, regardless of the scope assigned to it by Community law, owing to the fact that the national legislation incorporates a reference thereto .

2 . Since the criteria for distinguishing between Heading 9701, "paintings, drawings and pastels, executed entirely by hand ... collages and similar decorative plaques", and Heading 9703, "original sculptures and statuary, in any material", of the Common Customs Tariff lies in the fact that as regards productions of statuary and sculptural art the essential artistic nature consists in the shaping of a three-dimensional form of the work, whereas for paintings, collages and similar decorative plaques it consists in shaping the surface of the work, a work of art consisting of a steel plate having no artistic value of its own, with a fused coating of enamel-glaze colours applied by the artist by hand, must be regarded as a "painting executed entirely by hand" within the meaning of Heading 9701 .

In Case C-231/89,

REFERENCE to the Court under Article 177 of the EEC Treaty by the Bundesfinanzhof ( Federal Finance Court ) for a preliminary ruling in the proceedings pending before that court between

Krystyna Gmurzynska-Bscher, Galerie Gmurzynska,

and

Oberfinanzdirektion Koeln, ( Principal Revenue Office, Cologne )

intervener : Bundesminister der Finanzen ( Federal Minister for Finance ),

on the interpretation of Headings 8306 (" other ornaments, of base metal "), 9701 (" paintings, drawings and pastels, executed entirely by hand" or "similar decorative plaques ") and 9703 (" original sculptures and statuary, in any material ") of the annex to Council Regulation ( EEC ) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff ( Official Journal 1987 L 256, p . 1 ),

THE COURT,

composed of : O . Due, President, G . F . Mancini, T . F . O' Higgins, J . C . Moitinho de Almeida and G . C . Rodríguez Iglesias ( Presidents of Chambers ), F . A . Schockweiler and F . Grévisse, Judges,

Advocate General : M . Darmon

Registrar : D . Louterman, Principal Administrator,

after considering the written observations submitted on behalf of the Commission of the European Communities by Joern Sack, Legal Adviser, acting as Agent,

having regard to the Report for the Hearing,

after hearing the oral observations of the Commission of the European Communities at the hearing on 22 May 1990,

after hearing the Opinion of the Advocate General delivered at the sitting on 3 July 1990,

gives the following

Judgment

1 By an order of 6 June 1989, which was received at the Court on 24 July 1989, the Bundesfinanzhof referred to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty two questions concerning the interpretation of Headings 8306 (" other ornaments, of base metal "), 9701 (" paintings, drawings and pastels, executed entirely by hand" or "similar decorative plaques ") and 9703 (" original sculptures and statuary, in any material ") of the annex to Council Regulation ( EEC ) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff ( Official Journal 1987 L 256, p . 1 ).

2 Those questions arose in proceedings between Mrs Krystyna Gmurzynska-Bscher ( Mrs Gmurzynska ), director of an art gallery in Cologne ( Federal Republic of Germany ) and the Oberfinanzdirektion Koeln ( hereinafter referred to as "the Revenue Office ") on the application of German tax law in relation to turnover tax on the import of a work of art .

3 It appears from the documents forwarded to the Court by the national court that in 1988 Mrs Gmurzynska purchased in the Netherlands for the sum of USD 400 000 a work by the artist Laszlo Moholy-Nagy entitled "Konstruktion in Emaille I ( Telefonbild )" consisting of a steel plate with a fused coating of enamel-glaze colours .

4 Before importing that work into the Federal Republic of Germany, Mrs Gmurzynska requested the German customs authorities to issue a binding customs tariff ruling for the purpose of applying German revenue law in relation to turnover tax on importation . For the purpose of granting exemptions or reductions in such cases German law refers to the Nomenclature of the Common Customs Tariff . The latter provides for the application of a reduced rate of tax for works of art falling under Headings 9701 and 9703 of the Common Customs Tariff .

5 On 7 July 1988 the Revenue Office issued Mrs Gmurzynska a ruling classifying the work in question under Heading 8306 (" other ornaments, of base metal "). That classification meant that the work was subject to the full rate of German turnover tax on imports .

6 Mrs Gmurzynska, however, considered that the work was to be regarded as a "similar decorative plaque" falling under Heading 9701 of the Common Customs Tariff, in which case a reduced rate of turnover tax on imports would be applicable .

7 When her objection to the tariff ruling was rejected, she brought an action before the Bundesfinanzhof .

8 In the grounds of its order for reference the national court explained that the outcome of the case depended on the interpretation of Headings 8306, 9701 and 9703 of the Common Customs Tariff .

9 The national court considers that although according to the case-law of the Court ( judgment in Case 155/84 Onnasch v Hauptzollamt Berlin-Packhof [1985] ECR 1449 ) the expression "original sculptures and statuary, in any material" under Heading 9703 is to be interpreted widely so as to embrace all three-dimensional artistic productions irrespective of the techniques and the materials used, it is doubtful whether the work in question may be classified under that heading . It suggests that although it is a three-dimensional object, the actual artistic production consists of a design on the surface of a steel plate .

10 The national court also considers it doubtful whether the work can be regarded as a "similar decorative plaque" under Heading 9701 of the Common Customs Tariff since, according to the Explanatory Notes to the Harmonized Commodity Description and Coding System (" the Explanatory Notes "), such a plaque must be composed of various materials assembled so as to form a picture or decorative design or motif on a backing .

11 The national court considers that it may be more plausible to consider the work as a "painting executed entirely by hand" within the meaning of Heading 9701 of the Common Customs Tariff, since the artist' s action in applying colour to the background must in itself be regarded as the creation of such a painting irrespective of any subsequent technical process and in particular even though in the present case the colour design became recognizable only as a result of the subsequent firing process .

12 Only if Heading 9701 of the Common Customs Tariff is inapplicable does the national court contemplate the possibility of classifying the work in question as an "ornament" within the meaning of Heading 8306, although it is not, in its opinion, for decoration, which is a main feature of the relevant articles according to the Explanatory Notes to that heading .

13 Since it took the view that the case therefore raised a question concerning the interpretation of the Community rules in issue, the Bundesfinanzhof stayed the proceedings and referred the following questions to the Court of Justice for a preliminary ruling :

"( 1 ) Is the Common Customs Tariff ( Combined Nomenclature ) to be interpreted as meaning that a work of art such as the 'Konstruktion in Emaille I ( Telefonbild )' executed in 1922 by L . Moholy-Nagy, consisting of a steel plate measuring approximately 955 x 610 mm with a fused coating of enamel-glaze colours should be classified as :

( a ) 'original sculpture and statuary' - Heading 9703 - or as

( b ) a 'similar decorative plaque' or a 'painting ... executed entirely by hand' - Heading 9701?

2 . If not, should the Common Customs Tariff ( Combined Nomenclature ) be interpreted as meaning that a work of art of the kind described in Question 1 should be classified according to its material composition, in this case as an 'ornament of base metal' ( Heading 8306 )?"

14 Reference is made to the Report for the Hearing for a fuller account of the facts of the main proceedings, the course of the procedure and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court .

The Court' s jurisdiction

15 The interpretation which the Court is asked to give of the provisions of the Common Customs Tariff in issue is intended to enable the national court to give judgment on the application, not of the Common Customs Tariff, but of German law on turnover tax, which refers to the Nomenclature of the Common Customs Tariff . In those circumstances the preliminary question arises whether the procedure provided for in Article 177 of the Treaty is applicable, and thus whether the Court has jurisdiction to give a ruling on the questions put by the Bundesfinanzhof .

26 It follows from the foregoing considerations that the Court has jurisdiction to give a preliminary ruling on the questions put by the Bundesfinanzhof .

The questions

27 In its questions the national court asks in substance whether the Common Customs Tariff must be interpreted as meaning that a work of art consisting of a steel plate with a fused coating of enamel-glaze colours constitutes a "painting ... executed entirely by hand" or a "similar decorative plaque" within the meaning of Heading 9701 of the Common Customs Tariff or an "original sculpture and statuary" within the meaning of Heading 9703, or whether it should be classified according to its material composition under Heading 8306 as an "ornament of base metal ".

28 In that respect it should first be noted that it is clear from the order making the reference that the national court has no doubt that the object in question is an original work of art . Accordingly, an object of that kind cannot be regarded as being for decoration, which, according to the Explanatory Notes, constitutes the essential feature of articles classified under the heading "other ornaments, of base metal" of Heading 8306, which comes under Chapter 83 of the Common Customs Tariff, headed "Miscellaneous articles of base metal"; it must, on the contrary, be classified under Chapter 97, which covers "Works of art, collectors' pieces and antiques ".

29 That interpretation is consistent, moreover, with Note 4 to Chapter 97, according to which if there is doubt as to the classification of goods preference should be given to classifying them under one of the headings comprised in the chapter covering works of art, collectors' pieces and antiques .

30 That is particularly important in view of the fact that according to the case-law of the Court the headings of Chapter 97 of the Common Customs Tariff must be given a liberal interpretation ( see the aforementioned judgment of 15 May 1985 in the Onnasch case ), and secondly if the rate of customs duty laid down for the material used were applied to a value for customs purposes fixed on the basis of the work' s artistic nature, the duty payable would be out of all proportion to the cost of that material ( see the judgment in the Onnasch case, paragraph 11 ).

31 In those circumstances it remains to be determined whether a work such as that at issue in the main proceedings must be classified under Heading 9701 or Heading 9703 of the Common Customs Tariff .

32 In order to answer that question it must be noted that Heading 9701 comprises paintings, drawings and pastels, executed entirely by hand, as well as collages and similar decorative plaques, whereas Heading 9703 refers to original sculptures and statuary, in any material .

33 Although Heading 9701 and Heading 9703 of the Common Customs Tariff both cover entirely personal creations in which an artist expresses an aesthetic ideal, each refers to a specific category of works of art . Heading 9701 covers all pictorial works executed entirely by hand on a support of any kind of material, whereas Heading 9703 covers all three-dimensional representations in a material to which the artist has given a specific form, regardless of the technique and the materials used .

34 Accordingly, the criterion for distinguishing between the two headings at issue lies in the fact that as regards productions of statuary and sculptural art the essential artistic nature consists in the shaping of a three-dimensional form of the work, whereas for paintings, collages and similar decorative plaques it consists in shaping the surface of the work .

35 The artistic nature of a work such as that at issue resides not in its three-dimensional form, but in the fact that paint has been applied by hand by the artist upon a steel support which is in itself of no artistic value .

36 It follows that a work of this kind must be classified under Heading 9701 of the Common Customs Tariff .

37 That conclusion is unaffected by the fact that such a work is essentially composed of material such as steel and enamel normally used to make articles of sculptural art, since according to the Explanatory Notes articles covered by Heading 9701 of the Common Customs Tariff may be executed on supports of any material .

38 The fact that the colours have been subject to treatment after the artist has applied them by hand to the support used, and in particular have been subject to a firing process intended to fix and brighten them, is also irrelevant . The Explanatory Notes exclude only the use of any process which replaces the artist' s hand in placing the subject and the colours on the support .

39 Finally, a work of this kind comes under Heading 9701 of the Common Customs Tariff even if the surface on which the colours have been applied has a certain relief, since that is also the case in respect of collages and similar decorative plaques, which nevertheless are to be classified under that heading .

40 In order to answer the questions put by the national court it is also necessary to determine whether a work such as that at issue constitutes a "painting executed entirely by hand" or a "similar decorative plaque" within the meaning of Heading 9701 .

41 In that respect it suffices to point out that according to the Explanatory Notes a "similar decorative plaque" must be composed of bits and pieces of various materials assembled so as to form a picture or decorative design or motif on a backing .

42 As regards the work referred to in the main proceedings, only one material, namely coloured enamel, and no other material, has been placed on the backing used, so that a work of this kind cannot be regarded as a "similar decorative plaque" within the meaning of Heading 9701 .

43 It follows from all the considerations set out above that the answer to the questions put by the national court must be that the Common Customs Tariff is to be interpreted as meaning that a work of art consisting of a steel plate with a fused coating of enamel-glaze colours constitutes a painting executed entirely by hand within the meaning of Heading 9701 of the Common Customs Tariff .

Costs

44 The costs incurred by the Commission of the European Communities, which submitted observations to the Court, are not recoverable . As these proceedings are, in so far as the parties to the main proceedings 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 .

On those grounds,

THE COURT,

in answer to the questions referred to it by the Bundesfinanzhof, by an order of 6 June 1989, hereby rules :

The Common Customs Tariff must be interpreted as meaning that a work of art consisting of a steel plate with a fused coating of enamel-glaze colours constitutes a painting executed entirely by hand within the meaning of Heading 9701 .