JUDGMENT OF THE COURT OF 31 JANUARY 1979<appnote>1</appnote> Yoshida GmbH v Industrie- und Handelskammer Kassel (preliminary ruling requested by the Verwaltungsgericht Kassel) "Slide fasteners" Case 114/78 1. Goods — Slide fasteners — Origin — Determination thereof — Criteria — Commission Regulation (EEC) No 2067/77, Art. 1 — Invalid In adopting Regulation (EEC) No Regulation (EEC) No 802/68 of the 2067/77 concerning the determination of Council. Article 1 of Regulation No the origin of slide fasteners, the 2067/77 is therefore invalid. Commission exceeded its power under In Case 114/78 REFERENCE to the Court under Article 177 of the EEC Treaty by the Verwaltungsgericht Kassel for a preliminary ruling in the action pending before that court between Yoshida GmbH, Mainhausen (Federal Republic of Germany) and Industrie- und Handelskammer Kassel on the validity of Commission Regulation (EEC) No 2067/77 concerning the determination of the origin of slide fasteners (Official Journal L 242 of 21 September 1977, p. 5), 1 — Language of the Case: German. 151 JUDGMENT OF 31. 1. 1979 — CASE 114/78 THE COURT composed of: H. Kutscher, President, J. Mertens de Wilmars and Lord Mackenzie Stuart (Presidents of Chambers), A. M. Donner, P. Pescatore, M. Sørensen, A. O'Keeffe, G. Bosco and A. Touffait, Judges, Advocate General: F. Capotorti Registrar: A. Van Houtte gives the following JUDGMENT Facts and Issues The facts of the case, procedure, origin certifying that its products are conclusions and submissions and of German origin or possibly of arguments of the parties may be Community origin. Whereas these certi• summarized as follows: ficates have hitherto been granted under Article 5 of Regulation (EEC) No I — Facts and procedure 802/68 of 27 June 1968 on the common definition of the concept of the origin of The plaintiff in the main action is a sub• goods in so far as the value of the raw sidiary of the Yoshida Kogyo K. K. materials used in the manufacture of the undertaking in Tokyo. In its factory in slide fasteners of Japanese origin or orig• Wenkbach-Marburg it produces slide inating in another third country did not fasteners which it assembles from parts exceed 40% of the value of the selling imported from Japan or the raw price of the final product, by decision of materials for which are imported from 17 November 1977 and in consideration Japan. It sells the slide fasteners thus of Commission Regulation (EEC) No manufactured on the German market 2067/77 the defendant refused to grant and to third countries. the certificate of origin applied for on 7 November 1977 for exports to For certain sales, in particular so as to Belgium, Yugoslavia, Austria and avoid a quantitative restriction on Poland. The defendant rejected the exports, it requires for its products a complaint lodged against that decision certificate known as a certificate of by letter of 18 November 1977. 152 YOSHIDA INDUSTRIE- UND HANDELSKAMMER KASSEL On 30 November 1977 the plaintiff in assembling a slide fastener from its the main action brought proceedings constituent parts neither constitutes a against that decision before the Verwal• substantial process or operation nor tungsgericht Kassel which, after making results in the manufacture of a new an order on an application for the product or represents an important stage adoption of interim measures on 3 of manufacture within the meaning of February 1978, made an order staying Article 5; the proceedings and referred to the Whereas the processes or operations Court of Justice the following question: which may together "be considered as the "Does Commission Regulation (EEC) last substantial process or operation and No 2067/77 of 20 September 1977 which result in the manufacture of a new (Official Journal L 242 of 21 September product or represent an important stage 1977, p. 5) conflict with Article 5 of of manufacture consist of the forming Regulation No 802/68 of 27 June 1968 and placing of the scoops or other (Official Journal, English Edition 1968 interlocking elements onto the tapes and (I), p. 165) and Articles 30 and 110 of the manufacture of the slider by the EEC Treaty and with other processes such as stamping or moulding; provisions or principles of Community whereas the manufacture of the end law, in particular essential procedural pieces does not constitute a substantial requirements, in that it refuses to process or operation within the meaning recognize that the production of slide of Article 5; fasteners by the plaintiff determines the Whereas, in the absence of an opinion origin of the goods if sliders originating from the Committee on Origin, the in a third country (in the present Commission has not been able to adopt instance, Japan) are used?" the provisions which it envisages, in Regulation (EEC) No 2067/77, whose accordance with Article 14 (3) of Regu• validity is thus called in question, is lation (EEC) No 802/68; whereas the based on Article 5 of Regulation (EEC) Commission has applied Article 14 (3) No 802/68 of the Council of 27 June (b) and has submitted to the Council a 1968 (Official Journal, English Special proposal with regard to the provisions to Edition 1968 (I), p. 165) which provides be adopted; as follows: Whereas, at the end of the period of "A product in the production of which three months after the Council had been two or more countries were concerned informed, the Council had not adopted shall be regarded as originating in the the proposition." country in which the last substantial For this reason Regulation No 2067/77, process or operation that is economically under the heading "Working or justified was performed, having been processing that confers the status of orig• carried out in an undertaking equipped inating products when the following for the purpose, and resulting in the conditions are met", states as follows: manufacture of a new product or "Assembly including placing of the representing an important stage of manu• scoops or other interlocking elements facture." onto the tapes accompanied by the manu• The recitals of the preamble to Regu• facture of the slider and the forming of lation (EEC) No 2067/77 provide as the scoops or other interlocking follows: elements." "Whereas a slide fastener consists essentially of two parallel tapes, scoops or other interlocking elements, slider and end pieces; whereas the operation of 153 JUDGMENT OF 31. 1. 1979 — CASE 114/78 The order of 27 April 1978 of the — the infringement of Articles 30 and Verwaltungsgericht Kassel was entered 34 of the Treaty; in the Court Register on 11 May 1978. — the infringement of Article 110 of the Observations were submitted under Treaty; and Article 20 of the Protocol on the Statute — misuse of powers. of the Court of Justice on behalf of the plaintiff in the main action by Messrs 1. The facts Ehler, Feldmann and Wiemann, Advocates at the Cologne Bar, on behalf Yoshida (Deutschland) GmbH is one of of the defendant in the main action by the European subsidiaries of an under• Mr Biederbech, President of the taking in Tokyo. It distributes slide Industrie- und Handelskammer, Kassel fasteners which are the result of its own (Chamber of Commerce and Industry of production and of parts imported from Kassel), assisted by Mr Vigener, Japan, including the sliders. This division Principal Director, on behalf of the of the manufacturing operations is Commission of the European Com• customary in this industry. The result of munities by Mr Beschel, acting as Agent, the vertical integration of the Yoshida on behalf of the Government of the group has been that sliders in Europe Federal Republic of Germany by Mr von were supplied first from Japan then, as a Borries, acting as Agent, and on behalf result of the adoption of Regulation No of the Government of the Italian 2067/77, from Italy, where an under• Republic by Mr Maresca, acting as taking of its own has been set up. There Agent, assisted by Mr Favara, Avvocato are three types of slide fasteners (with dello Stato. metal teeth, with plastic teeth and with The Court, after hearing the report of spirals). This industry supplies, according the Judge-Rapporteur and the views of to their intended uses, a large number of the Advocate General, decided to open varieties of fastener. The German factory the oral procedure without any in Wenkbach supplies principally the preparatory inquiry. Federal Republic of Germany but also exports in particular to the countries of Eastern Europe. II — Summary of the written The importation of slide fasteners is observations submitted subject, under Regulation (EEC) No under Article 20 of the 646/75 (Official Journal L 67 of 14 Protocol on the Statute of March 1975, p. 21), to Community sur• the Court of Justice veillance. Previously the certificates of Community origin were granted without A. Observations submitted by the plaintiff difficulty by the Industrie- und Handels• in the main action kammer Kassel for the products manu• factured by the plaintiff in the main Yoshida (Deutschland) GmbH puts action, in application of Article 5 of forward eight points : Regulation No 802/68, if the parts of — the facts; Japanese origin did not exceed 40% of the price of the finished product. In this — the general significance of the case; field as in others the grant of certificates — the part played by the rules of origin by the competent trade organ• applicable with regard to origin; izations, if necessary after obtaining the — formal defects affecting Regulation No 2067/77; — the infringement of Article 5 of Regu• lation No 802/68; 154 YOSHIDA INDUSTRIE- UND HANDELSKAMMER KASSEL opinion of the Oberfinanzdirektionen [1977] ECR 41, in an agricultural (Principal Finance Boards), did not give matter, or of considering the regulation rise to any difficulties.