Case Studies

Regulation of import tariffs and quotas

Susannah represented a group of about 25 importers of orange juice from Israel who had been served with a notice from HM Commissioners for Customs & Excise (HMCE) that their products did not comply with the rule of origin requirements for orange juice under the EU/Israel Agreement and so they were not eligible to be granted the preferential tariff rate for goods imported from Israel. HMCE sought recovery of considerable amounts of back dated duty for a period of around 4 years. Prior to the notice the European Commission had indicated that there had been irregularities in the procedures adopted by Israeli authorities relating to the origin requirements of a number of Israeli products, including orange juice.

Susannah identified a potential defence to the HMCE claim under the EC Customs Code, on the basis that the importers had unknowingly imported non- compliant goods as a result of errors made by the authorities of a third country. However, proof was needed to evidence this defence and much of it was held by the European Commission. After over three years of persistent attempts at discovery, an application was made to the UK VAT Tribunal to serve a witness summons on the Head of Delegation of the European Commission in London, requiring information from all of the European Commission’s sources, including overseas delegations. This set a precedent for discovery in the UK in relation to information held by the European Commission worldwide.

The Commission responded by sending fuller information about an earlier EC mission to Israel on which the Commission has based its earlier findings which was adverse to the Commission’s case. The Commission subsequently conceded the case, instructing HMCE not to recover the duty claimed and to pay the appellants’ costs.