Decision of the European Ombudsman on complaint 1837/2002/BB against the European Commission

Strasbourg, 21 October 2003

Dear Mr X.,

On 24 October 2002, you made a complaint to the European Ombudsman concerning the lack of reply to your complaint sent to the Commission on 28 February 2001. Your complaint to the Commission concerned alleged discrimination, based on Finnish motor vehicle taxes and actions of the customs authorities regarding the export of new cars from Finland.

I would like to inform you that Mr Jacob Söderman, with whom you have previously corresponded concerning your complaint, has retired and that, from 1 April 2003, I am his successor as European Ombudsman.

On 6 November 2002, the Ombudsman's secretariat telephoned the Commission's services to inquire whether a reply to you was being prepared. On 25 November 2002, the Commission's services forwarded to the Ombudsman a copy of their letter to you of the same date. The Ombudsman did not consider the letter to be an adequate reply to your complaint to the Commission. On 5 December 2002, therefore, your complaint was forwarded to the President of the European Commission. The Commission sent its opinion on 3 March 2003. The opinion was forwarded to you with an invitation to make observations, which you sent on 16 April 2003.

I am writing now to let you know the results of the inquiries that have been made.

THE COMPLAINT

On 28 February 2001, the complainant sent a complaint to the European Commission concerning alleged discrimination based on Finnish motor vehicle taxes and actions of the customs authorities regarding export of new cars from Finland.

In his complaint to the Ombudsman, the complainant claims that he has received neither an acknowledgement of receipt, nor any other reply or contact from the Commission. According to the complainant, he sent an e-mail message to the address Librarian-information@cec.eu.int on 27 September 2002 requesting information about his complaint, but received no reply.

THE INQUIRY

The Commission's opinion

The Commission made, in summary, the following points:

The complainant alleges that the Finnish Motor Vehicle Tax Act is contrary to EC law as it allows a possible restriction of competition within the EU.

Under the Finnish Motor Vehicle Tax Act, tax-free sales of new vehicles to foreign countries can be implemented solely with the consent of a registered taxpayer. In practice, the registered taxpayer referred to in the Motor Vehicle Tax Act is the importer of the vehicle brand authorised by the automobile factory. When selling a new vehicle to a foreign country, the importer can sell an undeclared vehicle tax-free, or the importer can apply for a refund of motor vehicle tax that has been paid on a vehicle that has already been declared, provided that the vehicle has not been registered or introduced in Finland nor surrendered to a consumer residing permanently in Finland.

The complainant claims that on the basis of the Finnish Motor Vehicle Tax Act vehicle importers usually require their authorised dealers to register in Finland all the vehicles that they sell. This would be likely to ensure that nobody could then apply any longer for a refund of motor vehicle tax on such a vehicle. According to the complainant, the sale of new motor vehicles to foreign countries is entirely under the charge and control of the vehicle importers even after the ownership of a vehicle has passed from the importer.

The complainant alleges that on the basis of these provisions, vehicle importers never provided him with the information or the proxy required for making an application for refund of the motor vehicle tax, thus making it impossible for him to sell new motor vehicles from Finland at sensible prices.

The complaint was sent to DG Taxation and Customs Union (TAXUD) on 28 February 2001. The issues raised by the complaint were rather complex and, for some time, DG TAXUD has been evaluating whether to transfer the case to DG Competition (COMP) or to associate DG COMP with the reply. As a matter of fact, aspects concerning both taxation and competition rules were closely entwined.

The Commission’s Communication on taxation of passenger cars in the European Union(1), accompanied by an information note on the taxation of cars transferred within the Community or used regularly on cross-border journeys, was published on 6 September 2002. In addition, an important case was before the Court of Justice concerning the computational system for reimbursement of the motor vehicle tax. The judgement of the Court of Justice was published on 19 September 2002.(2)

After the above mentioned documents were published, DG TAXUD was able to re-examine the complainant's file and to ascertain that his case was not directly affected by them. Therefore, in the light of the existing relevant legislation, the need for a consultation with DG COMP was confirmed.

On 25 November 2002, DG TAXUD sent to the complainant a letter apologising for the long delay, explaining that his case was rather complex and informing him that an inter-service consultation was needed together with the competent officials in DG COMP in order to assess whether, and to what extent, the situation was likely to fall within the scope of the provisions of the EC Treaty in the field of competition.

On 2 December 2002, DG TAXUD sent a note to DG COMP in order to ask for an opinion on this matter. DG COMP replied to DG TAXUD's query with a note and, on the basis of this note, DG COMP was associated to the procedure under examination.

On the basis of this co-operation between DG TAXUD and DG COMP, a reply on the substance was sent to the complainant on 27 January 2003.

From a fiscal point of view, Member States remain free to apply internal taxation to motor cars on the occasion of their first entry into use within their territory. However, Member States' rights in that respect are considerably restricted by the provisions of both the Treaty and derived Community law.

Unfortunately, the complainant's situation does not fall within the scope of these relevant provisions, nor it is covered by the existing case-law of the Court of Justice. Therefore, on the basis of the complainant's allegations, the Finnish Motor Vehicle Tax Act cannot be considered as incompatible with Community law as it stands at present, at least as concerns the tax refund procedure.

As regards the other aspect of the complaint, the complainant does not provide any evidence to support his claim that car importers oblige their authorised dealers to pre-register all vehicles supplied to them and that the car manufacturers then block any request for information necessary to obtain a tax refund. If such a strategy were in fact being implemented, this would merit an examination to see whether it restricted parallel trade, and whether this breached Article 81 of the Treaty.

The Commission recognises that, by not replying to the complainant's letter dated 28 February 2001 in due time, its services did not act in accordance with the engagements towards the Ombudsman to acknowledge all correspondence within fifteen working days of receipt. The Commission wished to emphasise, however, that the complainant's file was thoroughly examined by its services in order to assess the nature of the complaint and to ascertain the possible impact of the legislation in preparation on the situation described.

The complainant's observations

The complainant made observations on the substance of the Commission's reply. According to him, the Commission has handled his complaint in a very complicated manner and it has introduced in its reply several issues which are not directly relevant to his complaint. As regards the lack of evidence mentioned by the Commission, the complainant explained that he is aware that the problem exists in practice. However, it is impossible for him to obtain concrete evidence to support his allegations.

The complainant suggested that the Commission should request further information from the Finnish Competition Authority. The complainant requested the Ombudsman to demand that the Commission investigate thoroughly whether the Finnish motor vehicle taxation is discriminatory and whether the import of new cars restricts competition.

THE DECISION

1 Alleged lack of reply

1.1 The complainant sent a complaint to the European Commission on 28 February 2001, concerning alleged discrimination based on Finnish automobile taxes and actions of the customs authorities regarding import of new cars from Finland. On 24 October 2002, the complainant sent a complaint to the European Ombudsman alleging that he has received neither an acknowledgement of receipt nor any other reply or contact from the Commission.

1.2 The Commission recognises that, by not replying to the complainant's letter dated 28 February 2001 in due time, its services did not act in accordance to the engagements towards the Ombudsman to acknowledge all correspondence within fifteen working days of receipt. DG Taxation and Customs Union sent to the complainant a holding reply on 25 November 2002 apologising for the long delay, explaining that his case was rather complex and informing him that an inter-service consultation was needed together with the competent officials in DG Competition in order to assess it. On 27 January 2003, the Commission sent a reply on the substance to the complainant. In its reply the Commission stated that the Finnish Motor Vehicle Tax Act cannot be considered incompatible with EC law as it stands at present. As regards the behaviour of the motor vehicle importers in Finland, the Commission invited the complainant to submit further evidence to support his claim.

1.3 The Ombudsman notes that, according the Commission's Code of Good Administrative Behaviour(3), a reply to a letter addressed to the Commission shall be sent within fifteen working days from the date of receipt of the letter by the responsible Commission department. If a reply cannot be sent within the deadline mentioned above, the member of staff responsible should send a holding reply, indicating a date by which the addressee may expect to be sent a reply in the light of this additional work, taking into account the relative urgency and complexity of the matter.

1.4 The Ombudsman notes that the Commission has acknowledged that the delay in answering the complainant's letter was excessive. Furthermore, the Ombudsman notes that, following the complaint to the Ombudsman, the Commission rapidly sent a holding letter to the complainant, followed by a substantive reply two months later. The Ombudsman therefore considers that the Commission has taken appropriate corrective action to deal with the excessive delay and that no further inquiries into this case are therefore justified.

1.5 In his observations, the complainant requested the Ombudsman to demand that the Commission investigate thoroughly whether the Finnish motor vehicle taxation is discriminatory and whether the import of new cars restricts competition. The Ombudsman considers that these points raise issues outside of the scope of the original complaint concerning the Commission’s failure to reply to the complainant. The Ombudsman also points out that, since the complainant has now received a substantive reply from the Commission, he has the possibility to submit a new complaint to the Ombudsman if he is not satisfied with the Commission’s reply.

2 Conclusion

For the reasons stated above, the Ombudsman considers that no further inquiries into the present complaint are justified. The Ombudsman therefore closes the case.

The President of the European Commission will also be informed of this decision.

Yours sincerely,

 

P. Nikiforos DIAMANDOUROS

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(1) Communication of the Commission to the Council and the European Parliament - Taxation of passenger cars in the European Union- options for action at national and Community levels COM/2002/0431.

(2) Judgement of 19 September 2002, case C-101/00, Tulliasiamies, Antti Siilin, ECR 2002 Page I-07487.

(3) 2000 OJ L 308/26 at 308/32.