Marks & Spencer plc v Commissioners of Customs & Excise.

• Jurisdiction: European Union
• Celex Number: 62000CJ0062
• ECLI: ECLI:EU:C:2002:435
• Docket Number: C-62/00
• Court: Court of Justice (European Union)
• Procedure Type: Reference for a preliminary ruling
• Date: 11 July 2002

Judgment of the Court (Fifth Chamber) of 11 July 2002. - Marks & Spencer plc v Commissioners of Customs & Excise. - Reference for a preliminary ruling: Court of Appeal (England & Wales) (Civil Division) - United Kingdom. - Sixth VAT directive - National legislation retroactively curtailing a limitation period for repayment of sums unduly paid - Compatibility with the principles of effectiveness and of the protection of legitimate expectations. - Case C-62/00.

European Court reports 2002 Page I-06325

Summary
Parties
Grounds
Decision on costs
Operative part

Keywords

1. Acts of the institutions - Directives - Implementation by Member States - Need to ensure the effective application of directives - Obligations of the national courts

(EC Treaty, Art. 5 and Art. 189, third para. (now Art. 10 EC and Art. 249, third para., EC))

2. Acts of the institutions - Directives - Direct effect - Scope - Not limited to cases of failure to transpose correctly or of incorrect transposition - Possibility for individuals to rely on provisions having direct effect where transposition measures have been applied imperfectly

(EC Treaty, Art. 189, third para. (now Art. 249, third para., EC))

Summary

$$1. The Member States' obligation under a directive to achieve the result envisaged by the directive and their duty under Article 5 of the Treaty (now Article 10 EC) to take all appropriate measures, whether general or particular, to ensure fulfilment of that obligation are binding on all the authorities of the Member States, including, for matters within their jurisdiction, the courts. It follows that in applying domestic law the national court called upon to interpret that law is required to do so, as far as possible, in the light of the wording and purpose of the directive, in order to achieve the purpose of the directive and thereby comply with the third paragraph of Article 189 of the Treaty (now the third paragraph of Article 249 EC).

( see para. 24 )

2. Individuals are entitled to rely before national courts, against the State, on the provisions of a directive which appear, so far as their subject-matter is concerned, to be unconditional and sufficiently precise whenever the full application of the directive is not in fact secured, that is to say, not only where the directive has not been implemented or has been implemented incorrectly, but also where the national measures correctly implementing the directive are not being applied in such a way as to achieve the result sought by it. In fact, the adoption of national measures correctly implementing a directive does not exhaust the effects of the directive and a Member State remains bound actually to ensure full application of the directive even after the adoption of those measures.

( see para. 27 )

3. The principles of effectiveness and of the protection of legitimate expectations preclude national legislation retroactively curtailing the period within which repayment may be sought of sums paid by way of VAT collected in breach of provisions with direct effect of Sixth Directive 77/388 on the harmonisation of the laws of the Member States relating to turnover taxes, such as those in Article 11A(1) of that directive.

In fact, whilst the principle of effectiveness does not preclude national legislation reducing the period within which repayment of sums collected in breach of Community law may be sought it is subject to the condition not only that the new limitation period is reasonable but also that the new legislation includes transitional arrangements allowing an adequate period after the enactment of the legislation for lodging the claims for repayment which persons were entitled to submit under the original legislation. Such transitional arrangements are necessary where the immediate application to those claims of a limitation period shorter than that which was previously in force would have the effect of retroactively depriving some individuals of their right to repayment, or of allowing them too short a period for asserting that right.

Moreover, the principle of the protection of legitimate expectations precludes a national legislative amendment which retroactively deprives a taxable person of the right enjoyed prior to that amendment to obtain repayment of taxes collected in breach of provisions of the Sixth Directive with direct effect.

( see paras 38, 46-47, operative part )

Parties

In Case C-62/00,

REFERENCE to the Court under Article 234 EC for a preliminary ruling by the Court of Appeal (Civil Division) (England and Wales) in the proceedings pending before that court between

Marks & Spencer plc

and

Commissioners of Customs & Excise,

on the interpretation of Community law on the recovery of sums unduly paid,

THE COURT (Fifth Chamber),

composed of: P. Jann, President of the Chamber, D.A.O. Edward and A. La Pergola (Rapporteur), Judges,

Advocate General: L.A. Geelhoed,

Registrar: L. Hewlett, Administrator,

after considering the written observations submitted on behalf of:

- Marks & Spencer, by D. Waelbroeck, avocat, and D. Milne QC, instructed initially by Walker Martineau and then by Forbes Hall, Solicitors,

- the United Kingdom Government, by J.E. Collins, acting as Agent, K.P.E. Lasok QC and P. Mantle, Barrister,

- the Commission of the European Communities, by P. Oliver, acting as Agent,

having regard to the Report for the Hearing,

after hearing the oral observations of Marks & Spencer, the United Kingdom Government and the Commission at the hearing on 18 October 2001,

after hearing the Opinion of the Advocate General at the sitting on 24 January 2002,

gives the following

Judgment

Grounds

1 By order of 14 December 1999, received at the Court on 28 February 2000, the Court of Appeal (Civil Division) (England & Wales) referred to the Court for a preliminary ruling under Article 234 EC a question on the interpretation of Community law on the recovery of sums unduly paid.

2 The question was raised in proceedings between Marks & Spencer plc (Marks & Spencer) and the Commissioners of Customs & Excise (the Commissioners), who are responsible for the collection of value added tax (VAT) in the United Kingdom, concerning repayment of VAT overcharged to Marks & Spencer.

Legal background

Community legislation

3 Article 11 of Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1, the Sixth Directive) provides as follows:

A. Within the territory of the country

1. The taxable amount shall be:

(a) in respect of supplies of goods and services other than those referred...