Success in Customs Law for World Tax Service WTS
Glove dispute goes to the European Court of Justice
Luxemburg/Munich, 30 April 2010 – For more than a year a leatherette glove has kept judges at German and European finance courts busy. As World Tax Service WTS reports, the Finance Court Munich voiced doubts about the interpretation of EU law with regard to a dispute between the chief customs office in Munich and a renowned manufacturer of riding gloves. The controversial issue was whether a specific treatment made a leatherette glove a textile under customs law. The dramatic consequences: a potential considerable increase in customs duties and import restrictions.
“Spun textile fiber goods” is the term in customs law that the glove dispute is all about. The Munich-based riding glove manufacturer uses a specific treatment that involves roughening one side of the textile reinforcement and subsequently covering it with a layer of leatherette. The roughening of the material of all things is supposed to turn leatherette gloves into “spun textile fiber goods” – or textiles under customs law. The manufacturer objected to the additional charge and emphasized repeatedly that the glove’s surface is only roughened to give the covering layer better grip – something absolutely not visible to the end customer.
The judges at the European Court of Justice came to understand and agreed with the manufacturer’s position earlier this week: A leatherette glove stays a leatherette glove, irrespective of this kind of treatment, for customs purposes.(Ruling of 29 April 2010 Rs. C-123/09). The ruling has a significant effect on customs calculations as the chief customs office in Munich had charged considerable duties. At the same time, the classification as a textile would have meant a compulsory application for an import license. “We are delighted about this unequivocal preliminary ruling from Luxemburg. As a consequence our client can expect a positive ruling from the Finance Court in Munich,” comments tax consultant Uwe Reimer, expert on customs and excise duties at the WTS branch in Frankfurt/Main.
Please note: We would be delighted to arrange an interview with Herbert Kühle and/or Uwe Reimer for you.
