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OPINION OF SIR GORDON SLYNN — CASE 160/80 On those grounds, THE COURT (Second Chamber) in answer to the question referred to it by the Tariefcommissie, by a judgment of 27 June 1980, hereby rules: The systematic classification of goods in the various sections and chapters of the Common Customs Tariff does not allow a gum which is used as a thickener, even if as regards its nature and composition it corresponds to the goods described in headings 13.02 and 13.03, to be classified in one of the headings of Chapter 13 of the Common Customs Tariff since the gum is prepared on an industrial scale by the action of the bacterium xanthomonas campestris on a culture medium of maize sugar and maize starch. Pescatore Touffait Due Delivered in open court in Luxembourg on 2 July 1981. A. Van Houtte P. Pescatore Registrar President of the Second Chamber OPINION OF ADVOCATE GENERAL SIR GORDON SLYNN DELIVERED ON 21 MAY 1981 My Lords, the Kelco Division of Merck & Co. Inc., an American undertaking, and imported This case concerns a consignment of five into the Netherlands by Smuling-De 100 lb drums of a substance called Leeuw BV (which I shall call "Keltről F", which was manufactured by "Smuling"). Keltről F appears to be the 1780 SMULING-DE LEEUW ν INSPECTEUR DER INVOERRECHTEN EN ACCIJNZEN trade name for food grade xanthan gum Heading 39.06 is divided into "A. produced by Merck & Co. When the Alginic acid and its salts and esters" and consignment was declared for home use "B. Other". in the Netherlands, the Inspecteur der Invoerrechten en Accijnzen at Rotterdam (whom I shall call the Inspector) It seems to be common ground that the classified it under heading 39.06 Β of the goods in this case are to be classified Common Customs Tariff (the CCT), either under "natural gums" within the which carries a 16% duty. Smuling meaning of heading 13.02, the other challenged this decision, claiming that mucilages and thickeners derived from the goods should be classified under vegetable products covered by heading heading 13.03 C III or, in the alternative, 13.03 CIII or the other high polymers heading 13.02, neither of which carries falling within heading 39.06 B. an import duty. According to the order for reference, The tariff headings in question are as xanthan gum is produced in the follows: biochemical industry by placing the bacterium xanthomonas campestris on a culture medium of maize sugar or maize starch supplemented with nitrogen, Heading 39.02 potassium phosphate and other trace elements, those three substances helping "Shellac, Seed lac, Stick lac and other to nurture the micro-organisms. The lacs; natural gums, resins, gum-resins xanthan gum is created metabolically, and balsams". through the metabolism of the bacterium. When this process is complete, the product is precipitated with isopropyl Heading 13.03 alcohol and subsequently dried and milled. No further chemical transform­ "Vegetable saps and extracts; pectic ation occurs. Xanthan gum is a hetero- substances, pectinates and pectates; agar- polysaccharide with short side chains, agar and other mucilages and thickeners, being a natural high polymer in derived from vegetable products". which each repeating molecule block consists of D-mannose, D-glucose and D-glucuronic acid molecules. Heading 13.03 is divided into three subheadings of which the last is "Agar- Agar and other mucilages and On appeal before the Tariefcommissie, it thickeners, derived from vegetable seems to have been agreed between the products". This is itself subdivided into parties that, in view of its structure, three, "Agar-Agar", "Mucilages and method of production and use, xanthan thickeners extracted from locust beans or gum corresponds to mucilages and locust bean seeds" and, lastly, heading thickeners, derived from vegetable 13.03 C III, "Other". products, within the meaning of heading 13.03. The Inspector, the respondent in the appeal, seems to have accepted that Heading 39.06 as regards its chemical and biological classification it corresponded closely to "Other high polymers, artificial resins the gums and mucilages falling under and artificial plastic materials, including both headings 13.02 and 13.03 of the alginic acid, its salts and esters; linoxyn". Tariff. 1781 OPINION OF SIR GORDON SLYNN — CASE 160/80 After hearing argument, the Tarief­ the goods described under headings commissie came to the conclusion that 13.02 and 13,03, to be classified under the imported goods corresponded to one of the headings of Chapter 13 of the those covered by headings 13.02 and Common Customs Tariff if the gum is 13.03 as well as to the high polymers prepared on an industrial scale by the covered by heading 39.06. It therefore action of the bacterium xanthomonas decided that it was necessary to apply campestris on a culture medium of maize Article 4 (3) (a) of the Tariefbesluit, sugar or maize starch?" 1960, which corresponds to Rule A (3) (a) of the General Rules for the Interpretation of the CCT Nomencla­ ture. That Rule is as follows: Although some criticisms have been made of the form of the question, it seems that it is clearly asking the Court to rule whether a substance which "When for any reason, goods are, prima corresponds to goods specified in facie, classifiable under two or more Chapter 13 is excluded because the headings, classification shall be effected goods are prepared "on an industrial as follows: scale" by the action described. It seems to me that in essence the question is really whether a substance of the kind described, produced in the way described, is capable of falling within (a) The heading which provides the Chapter 13 properly construed. most specific description shall be preferred to headings providing a more general description". The answer to that question depends on an interpretation of the wording of the heading relied on in the light of the General Rules for the interpretation of The Tariefcommissie thought that both the nomenclature to be found at the headings 13.02 and 13.03 provided a beginning of the annex containing the more specific description of the product CCT in the Regulation applicable at the in question than heading 39.06 but, since time (here Regulation No 2723/76 of the Inspector had contended that 8 November 1976). Rule A of those products, such as the one in dispute, General Rules declares "Interpretation of which were not obtained naturally but by the nomenclature of the Common biochemical industrial processes, could Customs Tariff shall be governed by the not fall within Chapter 13, it decided to following principles. (1) ... for legal refer the following question to the purposes, classification shall be Court: determined according to the terms of the headings and any relative Section or Chapter Notes ..." Rule A to a large extent reproduces the Rules for the "Does not the systematic classification of interpretation of the Customs Cooper­ goods under the various sections and ation Council (or "CCC") Nomencla­ chapters of the Common Customs Tariff ture. As the Court has already held, allow a gum, which is used as a reference may be made to the CCC thickener and which, as regards its Explanatory Notes in the absence of any nature and composition, corresponds to Community Explanatory Notes, though 1782 SMULING-DE LEEUW ν INSPECTEUR DER INVOERRECHTEN EN ACCIJNZEN the former cannot of course override be "derived from vegetable products" in what the Court finds to be the real the English text or "dérivés des meaning of the Common Customs végétaux" in the French text. I Tariff. understand that the Dutch text is to the same effect as the English and that the German and Danish texts have words similar to "vegetable substances or matter", namely "pflanzliche Stoffe" and "vegetabilske stoffer". The Italian text is "vegetali". All the texts must be construed to mean the same thing. "Vegetable" is common to all. "Veg­ etable products" are capable of including a much wider range of items which could not possibly be described as The first issue is therefore whether a "vegetables". Unless the word "derived" substance produced as described falls is to be given an extensive interpretation, under heading 13.02 and in particular which I do not consider that it should, it whether it is a natural gum. The critical seems to me that the meaning to be word is "natural", and, as was pointed accepted is that indicated in the French out on behalf of the Commission and the text by the word "végétaux". It does not French Government, none of the seem to me that Keltről F produced as products referred to as natural gum in described is capable of being said to be the CCC Explanatory Notes (to which "dérivé des végétaux". the Community notes refer) appears to be other than one found naturally. These gums, like the other substances in the second part of the heading, are said to "have the common feature of being vegetable secretions which solidify on contact with air". Keltről F exists only because it is produced in the way described: it does not come into being "naturally" within the meaning of the heading. Whether xanthan gum found Considerable scientific and technical naturally is within the heading it is material has been produced by the unnecessary to consider because in my company to show that other substances view the product in question here is not are produced by industrial means which a "natural gum". it is said fall within heading 13.03. Despite this, it is to be observed that most of the items in this heading are said to be obtained either naturally (perhaps by incision) or by a process of extraction or solution in e.g.

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