(Reference for a preliminary ruling from the Finanzgericht München)

(Common Customs Tariff – Combined Nomenclature – Tariff classification – Heading 8529 – Subheading 8529 90 40 – Keypad membrane for mobile telephones)

Judgment of the Court (Fifth Chamber), 15 February 2007

Summary of the Judgment

Common Customs Tariff – Tariff headings – Keypad membranes of polycarbonate intended for incorporation into mobile telephones

The Combined Nomenclature in Annex I to Regulation No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff, as amended by Regulation No 1789/2003, must be interpreted as meaning that keypad membranes of polycarbonate which have moulded keys on their upper side and non-conductive contact pins on their underside and are intended for incorporation into mobile telephones, which are unquestionably an essential component for the operation of those mobile telephones and the structure and method of operation of which preclude any use other than as a component of those telephones, fall under subheading 8529 90 40 as part of a mobile telephone in accordance with heading 8525.

(see paras 33, 37-38, 40, operative part 1)

15 February 2007 (*)

(Common Customs Tariff – Combined Nomenclature – Tariff classification – Heading 8529 – Subheading 8529 90 40 – Keypad membrane for mobile telephones)

In Case C-183/06,

REFERENCE for a preliminary ruling under Article 234 EC from the Finanzgericht München (Germany), made by decision of 23 February 2006, received at the Court on 13 April 2006, in the proceedings

Oberfinanzdirektion Nürnberg,

THE COURT (Fifth Chamber),

composed of R. Schintgen, President of the Chamber, A. Borg Barthet (Rapporteur) and E. Levits, Judges,

Advocate General: V. Trstenjak,

Registrar: R. Grass,

having regard to the written procedure,

after considering the observations submitted on behalf of:

–RUMA GmbH, by M. Beer, Rechtsanwalt,

–the Hungarian Government, by J. Fazekas, acting as Agent,

–the Commission of the European Communities, by J. Hottiaux, acting as Agent, assisted by B. Wägenbaur, avocat,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

1This reference for a preliminary ruling concerns the interpretation of headings 8529 and 8538 of the Combined Nomenclature in Annex I to Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff (OJ 1987 L 256, p. 1), as amended by Commission Regulation (EC) No 1789/2003 of 11 September 2003 (OJ 2003 L 281, p. 1) (‘the CN’).

2The reference was made in the course of proceedings between RUMA Finanzierungs- & Beteiligungsgesellschaft mbH (‘RUMA’) and the Oberfinanzdirektion Nürnberg (Principal Revenue Office, Nuremberg – ‘the Oberfinanzdirektion’) regarding the tariff classification of a keypad membrane for a mobile telephone with organiser functions.

Legal context

European Union law

Directive 2011/92

Recitals 7 to 9 of Directive 2011/92 state:

‘(7) Development consent for public and private projects which are likely to have significant effects on the environment should be granted only after an assessment of the likely significant environmental effects of those projects has been carried out. …

(8) Projects belonging to certain types have significant effects on the environment and those projects should, as a rule, be subject to a systematic assessment.

(9) Projects of other types may not have significant effects on the environment in every case and those projects should be assessed where the Member States consider that they are likely to have significant effects on the environment.’

Article 2(1) of that directive provides:

‘Member States shall adopt all measures necessary to ensure that, before development consent is given, projects likely to have significant effects on the environment by virtue, inter alia, of their nature, size or location are made subject to a requirement for development consent and an assessment with regard to their effects on the environment. Those projects are defined in Article 4.’

Under Article 3(1) of that directive:

‘The environmental impact assessment shall identify, describe and assess in an appropriate manner, in the light of each individual case, the direct and indirect significant effects of a project on the following factors:

…

(b) biodiversity, with particular attention to species and habitats protected under [Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora (OJ 1992 L 206, p. 7), as amended by Council Directive 2013/17/EU of 13 May 2013 (OJ 2013 L 158, p. 193) (“Directive 92/43”)] and Directive 2009/147/EC [of the European Parliament and of the Council of 30 November 2009 on the conservation of wild birds (OJ 2010 L 20, p. 7)];

…’

Article 4 of Directive 2011/92 provides:

‘1. Subject to Article 2(4), projects listed in Annex I shall be made subject to an assessment in accordance with Articles 5 to 10.

(a) a case-by-case examination;

(b) thresholds or criteria set by the Member State.

Member States may decide to apply both procedures referred to in points (a) and (b).

Where a case-by-case examination is carried out or thresholds or criteria are set for the purpose of paragraph 2, the relevant selection criteria set out in Annex III shall be taken into account. Member States may set thresholds or criteria to determine when projects need not undergo either the determination under paragraphs 4 and 5 or an environmental impact assessment, and/or thresholds or criteria to determine when projects shall in any case be made subject to an environmental impact assessment without undergoing a determination set out under paragraphs 4 and 5.

Where Member States decide to require a determination for projects listed in Annex II, the developer shall provide information on the characteristics of the project and its likely significant effects on the environment. The detailed list of information to be provided is specified in Annex IIA. The developer shall take into account, where relevant, the available results of other relevant assessments of the effects on the environment carried out pursuant to Union legislation other than this Directive. The developer may also provide a description of any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.

The competent authority shall make its determination, on the basis of the information provided by the developer in accordance with paragraph 4 taking into account, where relevant, the results of preliminary verifications or assessments of the effects on the environment carried out pursuant to Union legislation other than this Directive. The determination shall made available to the public and:

(a) where it is decided that an environmental impact assessment is required, state the main reasons for requiring such assessment with reference to the relevant criteria listed in Annex III; or

(b) where it is decided that an environmental impact assessment is not required, state the main reasons for not requiring such assessment with reference to the relevant criteria listed in Annex III, and, where proposed by the developer, state any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.

Member States shall ensure that the competent authority makes its determination as soon as possible and within a period of time not exceeding 90 days from the date on which the developer has submitted all the information required pursuant to paragraph 4. In exceptional cases, for instance relating to the nature, complexity, location or size of the project, the competent authority may extend that deadline to make its determination; in that event, the competent authority shall inform the developer in writing of the reasons justifying the extension and of the date when its determination is expected.’

Annex II.A of that directive contains the list of ‘information to be provided by the developer on the projects listed in Annex II’. That list reads as follows:

‘1. A description of the project, including in particular:

(a) a description of the physical characteristics of the whole project and, where relevant, of demolition works;

(b) a description of the location of the project, with particular regard to the environmental sensitivity of geographical areas likely to be affected.

(a) the expected residues and emissions and the production of waste, where relevant;

(b) the use of natural resources, in particular soil, land, water and biodiversity.

Annex III to that directive sets out the ‘criteria to determine whether the projects listed in Annex II should be subject to an environmental impact assessment’.

Directive 2014/52

Recitals 11 and 29 of Directive 2014/52 state:

‘(11) The measures taken to avoid, prevent, reduce and, if possible, offset significant adverse effects on the environment, in particular on species and habitats protected under [Directive 92/43] and Directive 2009/147 …, should contribute to avoiding any deterioration in the quality of the environment and any net loss of biodiversity, in accordance with the [European] Union’s commitments in the context of the [United Nations Convention on Biological Diversity, signed in Rio de Janeiro on 5 June 1992,] and the objectives and actions of the Union Biodiversity Strategy up to 2020 laid down in the [Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions] of 3 May 2011 entitled ‘Our life insurance, our natural capital: an EU biodiversity strategy to 2020’ [(COM(2011) 244 final)]

…

(29) When determining whether significant effects on the environment are likely to be caused by a project, the competent authorities should identify the most relevant criteria to be considered and should take into account information that could be available following other assessments required by Union legislation in order to apply the screening procedure effectively and transparently. In this regard, it is appropriate to specify the content of the screening determination, in particular where no environmental impact assessment is required. Moreover, taking into account unsolicited comments that might have been received from other sources, such as members of the public or public authorities, even though no formal consultation is required at the screening stage, constitutes good administrative practice.’

Directive 92/43

Article 6(3) of Directive 92/43 provides:

‘Any plan or project not directly connected with or necessary to the management of the site but likely to have a significant effect thereon, either individually or in combination with other plans or projects, shall be subject to appropriate assessment of its implications for the site in view of the site’s conservation objectives. In the light of the conclusions of the assessment of the implications for the site and subject to the provisions of paragraph 4, the competent national authorities shall agree to the plan or project only after having ascertained that it will not adversely affect the integrity of the site concerned and, if appropriate, after having obtained the opinion of the general public.’

Article 12(1) of that directive provides:

‘Member States shall take the requisite measures to establish a system of strict protection for the animal species listed in Annex IV(a) in their natural range, prohibiting:

(a) all forms of deliberate capture or killing of specimens of these species in the wild;

(b) deliberate disturbance of these species, particularly during the period of breeding, rearing, hibernation and migration;

(c) deliberate destruction or taking of eggs from the wild;

(d) deterioration or destruction of breeding sites or resting places.’

Point (a) of Annex IV to that directive mentions ‘all species’ of bats belonging to the suborder of ‘microchiroptera’.

Irish law

93

—wholly of silicone or wholly of polycarbonate, including printed keys,

For the manufacture or repair of mobile radio-telephones of subheading 8525 20 91 …’

11 Commission Regulation (EC) No 1578/2006 of 19 October 2006 concerning the classification of certain goods in the Combined Nomenclature (OJ 2006 L 291, p. 3), provides inter alia in the second and third recitals of the preamble:

‘(1) In order to ensure uniform application of the Combined Nomenclature annexed to Regulation (EEC) No 2658/87, it is necessary to adopt measures concerning the classification of the goods referred to in the Annex to this Regulation.

…

(3) Pursuant to those general rules, the goods described in column 1 of the table set out in the Annex to this Regulation should be classified under the CN codes indicated in column 2, by virtue of the reasons set out in column 3 of that table.’

12 The annex to Regulation No 1578/2006 provides inter alia the following:

‘Description of the goods

(CN Code)

Reasons

Classification is determined by General Rules 1 and 6 for the interpretation of the Combined Nomenclature, Note 2(b) to Section XVI and the wording of CN Codes 8529, 8529 90 and 8529 90 40. The construction of the keypad, in particular the shape, as well as the positioning, the layout and the print of the keycaps lead to classification of the keypad under CN code 8529 90 40 as a part for use solely or principally with apparatus of heading 8525.’

The dispute in the main proceedings and the question referred for a preliminary ruling

13 In August 2004, RUMA applied for binding tariff information concerning a keypad membrane which it described as a ‘mobile telephone keypad in the form of a contact pad’.

14 In tariff information of 28 September 2004, the Oberfinanzdirektion classified the product in question under subheading 8538 90 99 of the CN as ‘a part suitable for use solely with the apparatus of heading 8537’.

15 As it was of the opinion that that keypad membrane should be classified under subheading 8529 90 40 of the CN as a part for products of heading 8525, RUMA lodged an objection against that binding tariff information. As that objection was rejected, RUMA brought an action before the Finanzgericht München (Finance Court, Munich).

16 The national court describes the products in question as follows:

‘According to the information sheets, photographs and sample product submitted to the Zolltechnische Prüfungs- und Lehranstalt (Customs Testing and Teaching Institution) the disputed product, “a mobile telephone keypad in the form of a contact pad”, is a keypad made of polycarbonate. That polycarbonate membrane has moulded keys on its upper side and non-conductive contact pins on its underside. When a key is pressed the non-conductive contact pin operates a contact point on a contact membrane which lies under the polycarbonate membrane and which is not the subject of the binding tariff information. The keypad membrane is used as a pad to operate and cover the keys of mobile telephones.’

17 The national court takes the view that, according to note 2(b) to Section XVI of the CN, the product in question should be classified not on the basis of which of the machines listed in that section it is ultimately intended for use with, but on the basis of the machine which it is directly intended for use with. It considers a keypad membrane serves the direct purpose of completing a keyboard in accordance with heading 8537 with the result that the product in question should be classified under heading 8538 of the CN.

18 According to the national court, such a classification is confirmed by Regulation No 2243/2004 pursuant to which, under serial number 09.2995, ‘keypads … wholly of polycarbonate, including printed keys, for the manufacture or repair of mobile radio-telephones’ are classified under heading 8538 of the CN.

19 Nevertheless, the national court considers that it is prevented from confirming the binding tariff information issued by the Oberfinanzdirektion inter alia on account of the fact that the Customs Tariff and Statistical Nomenclature Committee has been dealing with the tariff classification of the disputed product for years, but has not managed to come to a decision.

20 In those circumstances, the Finanzgericht München decided to stay the proceedings and to refer the following question to the Court for a preliminary ruling:

‘Is the [CN] to be interpreted as meaning that keypads which have non-conductive contact pins on the underside are to be classified under heading 8538?’

The question referred for a preliminary ruling

Observations submitted to the Court

21 RUMA submits that the keypad membrane at issue in the main proceedings is a ‘part’ of a mobile telephone and must therefore be classified as such. According to RUMA, that membrane is necessary for the use of a mobile telephone with organiser functions and as it has been adapted especially for that purpose it cannot be used other than as part of a mobile telephone. Furthermore, it fulfils a protective function, in particular as it prevents dust from entering the mobile telephone.

22 RUMA is of the opinion that the keypad membrane at issue should therefore be classified under heading 8529 of the CN, as it is a part suitable for use solely with apparatus of heading 8525. It adds that classifying that membrane as part of a keyboard under heading 8538 of the CN would amount to categorising a mobile telephone keypad as an independent piece of apparatus, which cannot be the case given that the keypad obtains its function only when it is incorporated into the mobile telephone.

23 The Commission of the European Communities observes inter alia that it follows from the very wording of subheading 8529 90 40 that it includes the keypad membrane at issue in the main proceedings. The fact that that membrane is manifestly not an independent object, but a part of a mobile telephone, is a decisive factor according to the Commission. Firstly, the membrane is essential as it plays a direct role in the use of the mobile telephone. Secondly, it protects it from moisture and dust, thus preserving its ability to function.

24 The Commission adds that, according to Case C-339/98 Peacock [2000] ECR I‑8947, paragraph 21, the term ‘part’ implies ‘a “whole” for the operation of which the part is essential’. It takes the view that a mobile telephone is such a ‘whole’ as it is a piece of apparatus which is complete and directly operational from a technical point of view and the keypad membrane is essential for it to function.

25 The Hungarian Government observes that a part of a piece of apparatus covered by heading 8525 should, given the principles set out in the explanatory notes to the CN and the HS, be classified under heading 8529. It adds that, in accordance with the general rules for the interpretation of the CN, heading 8538 should be ruled out as regards the keypad membrane at issue in the main proceedings, since the wording of heading 8529 describes the product concerned most precisely as a part suitable for use with the apparatus of heading 8525.

The Court’s answer

26 The national court is essentially asking whether the keypad membrane at issue in the main proceedings should be classified under subheading 8538 90 99 of the CN as part of a keyboard in accordance with heading 8537 or under subheading 8529 90 40 as part of a mobile telephone in accordance with heading 8525.

27 It should be noted at the outset that it is settled case-law that, in the interests of legal certainty and ease of verification, the decisive criterion for the classification of goods for customs purposes is in general to be found in their objective characteristics and properties as defined in the wording of the relevant heading of the combined nomenclature and of the notes to the sections or chapters (see, inter alia, Case C-396/02 DFDS [2004] ECR I-8439, paragraph 27; Case C-495/03 Intermodal Transports [2005] ECR I-8151, paragraph 47; and Case C-445/04 Possehl Erzkontor [2005] ECR I-10721, paragraph 19).

28 In the present case, clearly the keypad membrane at issue in the main proceedings is not expressly referred to either in the wording of the headings of the CN or in that of the notes to the sections or chapters.

29 The wording of heading 8529 of the CN under which, according to RUMA, the keypad membrane at issue in the main proceedings comes refers to ‘[p]arts suitable for use solely or principally with the apparatus of headings 8525 to 8528’, which inter alia includes mobile telephones. The wording of heading 8538, under which the keypad membrane should, according to the Oberfinanzdirektion, be classified, relates to ‘[p]arts suitable for use solely or principally with the apparatus of heading 8535, 8536 or 8537’, which include inter alia ‘[b]oards, panels, consoles, desks, cabinets and other bases, equipped with two or more apparatus of heading 8535 or 8536, for electric control or the distribution of electricity’.

30 According to note 2(b) to Section XVI of the CN, ‘[o]ther parts, if suitable for use solely or principally with a particular kind of machine, or with a number of machines of the same heading …, are to be classified with the machines of that kind or in heading 8409, 8431, 8448, 8466, 8473, 8503, 8522, 8529 or 8538 as appropriate’.

31 It must be borne in mind that the term ‘part’ implies a whole for the operation of which the part is essential (Peacock, paragraph 21, and Case C-276/00 Turbon International [2002] ECR I-1389, paragraph 30).

32 In this connection, it must be noted that the assembling of the keypad membrane at issue in the main proceedings with the other components of a mobile telephone serves to ensure that it is a functional unit. The term ‘functional unit’, as defined by the case-law of the Court, applies where a machine or appliance consists of separate components which are designed to contribute together to a single clearly defined function (Case 223/84 Telefunken Fernseh und Rundfunk [1985] ECR 3335, paragraph 29).

33In the present case, the membrane plays a direct role in the use of the mobile telephone, in that it makes it possible to activate the contact points and thereby access the mobile telephone’s various functions. It is impossible to access the various functions of the telephone without the keypad membrane at issue in the main proceedings. Consequently, it is unquestionably an essential component for the operation of the mobile telephone.

34On the other hand, a mobile telephone keypad is not a functional unit which is distinct from the piece of apparatus into which it is incorporated inasmuch as it cannot be used independently or for a function other than that which may be performed by the telephone as a whole (see, inter alia, to that effect, Telefunken Fernseh und Rundfunk, paragraph 31).

35According to the wording of point 3(a) of the general rules for the interpretation of the CN in Part One, Section I, A, of the CN, which specifically covers the situation where goods are prima facie classifiable under two or more headings, ‘the heading which provides the most specific description shall be preferred to headings providing a more general description’. In the present case, it must be pointed out that, as regards the objective characteristics and properties of the keypad membrane at issue in the main proceedings, and in particular given the fact that it refers expressly to ‘[p]arts of apparatus of subheadings … 8525 20 91’, namely to parts of mobile telephones, subheading 8529 90 40 provides a more specific description than subheading 8538 90 99 which covers a much wider and more varied range of goods, as shown by its title read in conjunction with that of heading 8537.

36The intended use of a product may also constitute an objective criterion for classification if it is inherent to the product, and that inherent character must be capable of being assessed on the basis of the product’s objective characteristics and properties (see Case C-459/93 Thyssen Haniel Logistic [1995] ECR I-1381, paragraph 13).

37In the present case, the construction of the keypad membrane at issue in the main proceedings, in particular its shape, which is specially adapted to a type of mobile telephone, and its method of operation preclude any use of that membrane other than as a component of that telephone. The characteristics of the keypad membrane also have the function of ensuring that the telephone has a certain imperviousness as they prevent in particular dust and moisture from entering it.

38It follows from the above considerations that the keypad membrane at issue in the main proceedings must be classified under subheading 8529 90 40 of the CN as part of a mobile telephone in accordance with heading 8525.

39That finding is not called into question by the national court’s view that the classification of the keypad membrane at issue in the main proceedings under heading 8538 of the CN is confirmed by Regulation No 2505/96, in which, under serial number 09.2995, ‘keypads … wholly of polycarbonate, including printed keys, for the manufacture or repair of mobile radio-telephones’ are classified under heading 8538 of the CN, given that that provision, which was inserted into Annex I to Regulation No 2505/96 by Regulation No 2243/2004, was not applicable at the time of the facts in the main proceedings. Furthermore, it must, for the sake of completeness, be added that Regulation No 1578/2006, which has a date of adoption later than that of Regulation No 2243/2004, expressly provides for the classification of keypad membranes of polycarbonate, without any conductive elements and with moulded keys on one side and non-conductive contact pins on the other side, under subheading 8529 90 40 of the CN.

40In the light of all those considerations, the answer to the question referred for a preliminary ruling must be that the CN must be interpreted as meaning that keypad membranes of polycarbonate which have moulded keys on their upper side and non-conductive contact pins on their underside and are intended for incorporation into mobile telephones are covered by subheading 8529 90 40.

Costs

41Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (Fifth Chamber) hereby rules:

The Combined Nomenclature in Annex I to Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff, as amended by Commission Regulation (EC) No 1789/2003 of 11 September 2003, must be interpreted as meaning that keypad membranes of polycarbonate which have moulded keys on their upper side and non-conductive contact pins on their underside and are intended for incorporation into mobile telephones are covered by subheading 8529 90 40.

[Signatures]

*

Language of the case: German.