On 20 January, the Department of Administrative Cases of the Supreme Court stayed the proceedings in the case initiated upon application of “Veloserviss” Ltd., asking to abolish the decision of the State Revenue Service. By foregoing decision, the applicant was imposed an obligation to pay the customs tax and penalty and the value-added tax and penalty.  By referring to the Court of Justice of the European Union for preliminary ruling, the Supreme Court wants to specify, how importer’s obligation to act in good faith, which is mentioned in Article 220 (2) (b) of the Council Regulation (EEC) No 2913/92 of 12 October 1992 establishing the Community Customs Code, should be made concrete in general, if the report presented by the European Anti-Fraud Office (OLAF) contains acquired data, which is indicative of false information provided by the exporter, and  information indicating the fact that customs authority of the exporting state made a mistake, when issuing A certificate. Moreover, it is necessary to specify, what legal significance should be given to assessment of facts and laws carried out in respective decision adopted by OLAF and the European Commission in domestic proceedings, where actual situation has been compared only partly.    Proceedings are stayed in the case until the judgement of the Court of Justice of the European Union comes into effect.

The applicant, “Veloserviss” Ltd., imported bicycles from Cambodian company Atlantic Cycle Co.Ltd. for issue for free circulation in the European Union. On the basis of the A certificate issued to the Cambodian exporter, did not pay the customs tax and the value-added tax.  

The State Revenue Service carried out customs audit for the period, when bicycles the dispute relates to were imported, and did not establish any non-compliance in this respect. The applicant enforced the decision adopted in result of the audit.

In investigation carried out in June 2009, the European Commission’s European Anti-Fraud Office found out that the A certificate of origin of goods that was issued to the Cambodian company on 16 February 2007 was false. The State Revenue Service received this information on 15 February 2010.

Observing the established circumstances, the State Revenue Service carried out repeated audit of unitary administrative document processed in respect of the applicant.  Following information provided in the report by OLAF, the Service recognised that finished article must be applied an agreed rate of import duty, namely, 14 per cent of customs value of goods. The State Revenue Service imposed an obligation to the applicant to pay customs tax and penalty, and value-added tax and penalty.

Information prepared by Baiba Kataja, the Press secretary of the Supreme Court
Telephone: 67020396; e-mail: baiba.kataja@at.gov.lv