Undeclared repair-only boat entry is no import; re-export can kill debt

The General Court holds that bringing a third-country means of transport into the Union without customs clearance is not an importation subject to VAT where objective and verifiable evidence shows it was never intended for use inside the Union and it left again without actual useEuropa. Repair and maintenance work performed before re-export does not itself count as such useEuropa, and the repair services are separate transactions. A customs debt incurred by the irregular entry can still be extinguished after re-export where the work could have been authorised under inward processingEuropa.

The case concerns a Swiss-domiciled owner who drove a Swiss-registered sailing boat on a trailer into Germany without presenting it to customsEuropa. Stopped the same day, he said he was taking it to a German yard for work on the outboard motor. The customs office assessed import duties and import VAT. He paid the duties, had the yard overhaul the centreboard, engine, fuel filtration and exhaust catalyst, then re-exported the boat to SwitzerlandEuropa. The fiscal court annulled the assessment, treating any customs and VAT debt as extinguished on re-export. The Bundesfinanzhof referred two questions: whether a means of transport enters the Union's economic network when only a service is performed on it, and whether pre-export maintenance and repair is use under Article 124(1)(k) of the Union Customs Code.

On VAT, the Court recalls that importation under Articles 2(1)(d) and 30 of the VAT Directive, with the chargeable event under Articles 70 and 71, runs parallel to customs duties: unlawful introduction gives rise to a presumption that the goods entered the economic network and may be consumedEuropa, because consumption is the act VAT taxes. But breach alone does not prove entry into that networkEuropa. The presumption is rebutted where the importer shows with objective and verifiable evidence that the goods were not intended for consumption or use within the UnionEuropa. Means of transport are used, not consumed, and actual use means utilisation in line with their specific function, in particular carrying people or goods. Presence in the Union, movement to the repair site on a trailer without navigation, and work whose sole purpose is to render the boat fit for navigation are not actual useEuropa. Swiss domicile and registration, trailer transport, absence of German links beyond the yard, and re-export point against Union use, for the referring court to verify. That repair services may themselves be taxable supplies under Article 2(1)(c) is independent of import VAT and does not make the boat's entry an importationEuropa.

On customs, the debt arose under Article 79(1)(a) of Regulation (EU) No 952/2013 for breach of the presentation duty in Article 139(1)Europa. Article 124(1)(k), read with recital 38 and Article 124(6), extinguishes an Article 79 debt absent deception where the goods were not used or consumed and left the customs territoryEuropa. Used means only use that would itself justify duties. Work that could have been authorised as inward processing under Article 256 is not use, even without a formal authorisationEuropa; a missing formality cannot defeat a provision designed for breaches. The referring court must check whether the yard work fell within inward processing and whether the owner met the Article 211 conditions, including retroactive authorisation and, for a person established outside the Union, the occasional-case derogation in Article 161 of Delegated Regulation (EU) 2015/2446.

Legal basis is Articles 2(1)(d), 30, 70 and 71 of Council Directive 2006/112/EC and Articles 79, 124(1)(k), 139, 211 and 256 of Regulation (EU) No 952/2013 with Article 161 of Delegated Regulation (EU) 2015/2446, on a reference under Article 267 TFEU.