31.12.1986 EN Official Journal of the European Communities L 378/14 COUNCIL REGULATION (EEC) No 4057/86 of 22 December 1986 on unfair pricing practices in maritime transport THE COUNCIL OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, and in particular Article 84 (2) thereof, Having regard to the draft Regulation submitted by the Commission, Having regard to the opinion of the European Parliament (1), Having regard to the opinion of the Economic and Social Committee (2), Whereas there is reason to believe, inter alia on the basis of the information system set up by Council Decision 78/774/EEC (3), that the competitive participation of Community shipowners in international liner shipping is adversely affected by certain unfair practices of shipping lines of third countries; Whereas the structure of the Community shipping industry is such as to make it appropriate that the provisions of this Regulation should also apply to nationals of Member States established outside the Community or cargo shipping companies established outside the Community and controlled by nationals of Member States, if their ships are registered in a Member State in accordance with its legislation; Whereas such unfair practices consist of continuous charging of freight rates for the transport of selected commodities which are lower than the lowest freight rates charged for the same commodities by established and representative shipowners; Whereas such pricing practices are made possible by non-commercial advantages granted by a State which is not a member of the Community; Whereas the Community should be able to take redressive action against such pricing practices; Whereas there are no internationally agreed rules as to what constitutes an unfair price in the maritime transport field; Whereas, in order to determine the existence of unfair pricing practices, provision should therefore be made for an appropriate method of calculation; whereas when calculating the ‘normal freight rate’ account should be taken of the comparable rate actually charged by established and representative companies operating within or outside conferences or otherwise of a constructed rate based on the costs of comparable companies plus a reasonable margin of profit; Whereas appropriate factors relevant for the determination of injury should be laid down; Whereas it is necessary to lay down the procedures for those acting on behalf of the Community shipping industry who consider themselves injured or threatened by unfair pricing practices to lodge a complaint; whereas it seems appropriate to make it clear that in the case of withdrawal of a complaint, proceedings may, but need not necessarily, be terminated; Whereas there should be cooperation between the Member -States and the Commission both as regards information about the existence of unfair pricing practices and injury resulting therefrom, and as regards the subsequent examination of the matter at Community level; whereas, to this end, consultations should take place within an Advisory Committee; Whereas it is appropriate to lay down clearly the rules of procedure to be followed during the investigation, in particular the rights and obligations of the Community authorities and the parties involved, and the conditions under which interested parties may have access to information and may ask to be informed of the principal facts and considerations on the basis of which it is intended to propose the introduction of a redressive duty; Whereas, in order to discourage unfair pricing practices, but without preventing, restricting or distorting price competition by non-conference lines, providing that they are working on a fair and commercial basis, it is appropriate to provide, in cases where the facts as finally established show that there is an unfair pricing practice and injury, for the possibility of imposing redressive duties on particular grounds; Whereas it is essential, in order to ensure that redressive duties are levied in a correct and uniform manner, that common rules for the application of such duties be laid down; whereas, by reason of the nature of the said duties, such rules may differ from the rules for the levying of normal import duties; Whereas open and fair procedures should be provided for the review of measures taken and for the investigation to be reopened when circumstances so require; Whereas appropriate procedures should be established for examining applications for refund of redressive duties, HAS ADOPTED THIS REGULATION: Article 1 Objective This Regulation lays down the procedure to be followed in order to respond to unfair pricing practices by certain third country shipowners engaged in international cargo liner shipping, which cause serious disruption of the freight pattern on a particular route to, from or within the Community and cause or threaten to cause major injury to Community shipowners operating on that route and to Community interests. Article 2 In response to unfair pricing practices as described in Article 1 which cause major injury, a redressive duty may be applied by the Community. A threat of major injury may only give rise to an examination within the meaning of Article 4. Article 3 For the purposes of this Regulation: (a) ‘third country shipowner’ means cargo liner shipping companies other than those mentioned under (d); (b) ‘unfair pricing practices’ means the continuous charging on a particular shipping route to, from or within the Community of freight rates for selected or all commodities which are lower than the normal freight rates charged during a period of at least six months, when such lower freight rates are made possible by the fact that the shipowner concerned enjoys non-commercial advantages which are granted by a State which is not a member of the Community; (c) the ‘normal freight rate’ shall be determined taking into account: (i) the comparable rate actually charged in the ordinary course of shipping business for the like service on the same or comparable route by established and representative companies not enjoying the advantages in (b); (ii) or otherwise the constructed rate which is determined by taking the costs of comparable companies not enjoying the advantages in (b) plus a reasonable margin of profit. This cost shall be computed on the basis of all costs incurred in the ordinary course of shipping business, both fixed and variable, plus a reasonable amount for overhead expenses. (d) ‘Community shipowners’ means: — all cargo shipping companies established under the Treaty in a Member State of the Community; — nationals of Member States established outside the Community or cargo shipping companies established outside the Community and controlled by nationals of Member States, if their ships are registered in a Member State in accordance with its legislation. Article 4 Examination of injury 1. Examination of injury shall cover the following factors: (a) the freight rates offered by Community shipowners' competitors on the route in question, in particular in order to determine whether they have been significantly lower than the normal freight rate offered by Community shipowners, taking into account the level of service offered by all the companies concerned; (b) the effect of the above factor on Community shipowners as indicated by trends in a number of economic indicators such as: — sailings, — utilization of capacity, — cargo bookings, — market share, — freight rates (that is depression of freight rates or prevention of freight rate increases which would normally have occurred), — profits, — return of capital, — investment, — employment. 2. Where a threat of injury is alleged, the Commission may also examine whether it is clearly foreseeable that a particular situation is likely to develop into actual injury. In this regard, account may also be taken of factors such as: (a) the increase in tonnage deployed on the shipping route where the competition with Community shipowners is taking place; (b) the capacity which is already available or is to become available in the foreseeable future in the country of the foreign shipowners and the extent to which the tonnage resulting from that capacity is likely to be used on the shipping route referred to in (a). 3. Injury caused by other factors which, either individually or in combination, are also adversely affecting Community shipowners must not be attributed to the practices in question. Article 5 Complaint 1. Any natural or legal person, or any association not having legal personality, acting on behalf of the Community shipping industry who consider themselves injured or threatened by unfair pricing practices may lodge a written complaint. 2. The complaint shall contain sufficient evidence of the existence of the unfair pricing practice and injury resulting therefrom. 3. The complaint may be submitted to the Commission, or a Member State, which shall forward it to the Commission. The Commission shall send Member States a copy of any complaint it receives. 4. The complaint may be withdrawn, in which case proceedings may be terminated unless such termination would not be in the interest of the Community. 5. Where it becomes apparent after consultation that the complaint does not provide sufficient evidence to justify initiating an investigation, then the complainant shall be so informed. 6. Where, in the absence of any complaint, a Member State is in possession of sufficient evidence both of unfair pricing practices and of injury resulting therefrom for Community shipowners, it shall immediately communicate such evidence to the Commission. Article 6 Consultations 1. Any consultations provided for in this Regulation shall take place within an Advisory Committee, which shall consist of representatives of each Member State, with a representative of the Commission as Chairman. Consultations shall be held immediately on request by a Member State or on the initiative of the Commission. 2. The Committee shall meet when convened by its Chairman. He shall provide the Member States, as promptly as possible, with all relevant information. 3. Where necessary, consultation may be in writing only; in such case the Commission shall notify the Member States and shall specify a period within which they shall be entitled to express their opinions or to request an oral consultation. 4. Consultation shall in particular cover: (a) the existence of unfair pricing practices and the amount thereof; (b) the existence and extent of injury; (c) the causal link between the unfair pricing practices and injury; (d) the measures which, in the circumstances, are appropriate to prevent or remedy the injury caused by unfair pricing practices and the ways and means for putting such measures into effect. Article 7 Initiation and subsequent investigation 1. Where, after consultation, it is apparent that there is sufficient evidence to justify initiating a proceeding the Commission shall immediately: (a) announce the initiation of a proceeding in the Official Journal of the European Communities; such announcements shall indicate the foreign shipowner concerned and his country of origin, give a summary of the information received, and provide that all relevant information is to be communicated to the Commission; it shall state the period within which interested parties may make known their views in writing and may apply to be heard orally by the Commission in accordance with paragraph 5; (b) so advise the shipowners, shippers and freight forwarders known to the Commission to be concerned and the complainants; (c) commence the investigation at Community level, acting in cooperation with the Member States; such investigation shall cover both unfair pricing practices and injury resulting therefrom and shall be carried out in accordance with paragraphs 2 to 8; the investigation of unfair pricing practices shall normally cover a period of not less than six months immediately prior to the initiation of the proceeding. 2. (a) Where appropriate the Commission shall seek all the information it deems necessary and attempt to chheck this information with the shipowners, agents, shippers, freight forwarders, conferences, associations and other organizations, provided that the undertakings or organizations concerned give their consent. (b) Where necessary the Commission shall, after consultation, carry out investigations in third countries, provided that the firms concerned give their consent and the government of the country in question has been officially notified and raises no objection. The Commission shall be assisted by officials of those Member States which so request. 3. (a) The Commission may request Member States: — to supply information, — to carry out all necessary checks and inspections, particularly amongst shippers, freight forwarders, Community shipowners and their agents, — to carry out investigations in third countries, provided the firms concerned give their consent and the government of the country in question has been officially notified and raises no objection. (b) Member States shall take whatever steps are necessary in order to give effect to requests from the Commission. They shall send to the Commission the information requested together with the results of all inspections, checks or investigations carried out. (c) Where this information is of general interest or where its transmission has been requested by a Member State, the Commission shall forward it to the Member States provided it is not confidential, in which case a non-confidential summary shall be forwarded. (d) Officials of the Commission shall be authorized, if the Commission or a Member State so requests, to assist the officials of Member States in carrying out their duties. 4. (a) The complainant and the shippers and shipowners known to be concerned may inspect all information made available to the Commission by any party to an investigation as distinct from internal documents prepared by the authorities of the Community or its Member States provided that it is relevant to the defence of their interests and not confidential within the meaning of Article 8 and that it is used by the Commission in the investigation. To this end, they shall address a written request to the Commission, indicating the information required. (b) Shipowners subject to investigation and the complainant may request to be informed of the essential facts and considerations on the basis of which it is intended to recommend the imposition of redressive duties. (c) (i) Requests for information pursuant to (b) shall: — be addressed to the Commission in writing, — specify the particular issues on which information is sought. (ii) The information may be given either orally or in writing, as considered appropriate by the Commission. It shall not prejudice any subsequent decision which may be taken by the Council. Confidential information shall be treated in accordance with Article 8. (iii) Information shall normally be given no later than 15 days prior to the submission by the Commission of any proposal for action pursuant to Article 11. Representations made after the information is given may be taken into consideration only if received within a period to be set by the Commission in each case, which shall be at least 10 days, due consideration being given to the urgency of the matter. 5. The Commission may hear the interested parties. It shall so hear them if they have, within the periods prescribed in the notice published in the Official Journal of the European Communities, made a written request for a hearing showing that they are an interested party likely to be affected by the result of the proceeding and that there are particular reasons why they should be given a hearing. 6. Furthermore, the Commission shall, on request, give the parties directly concerned an opportunity to meet, so that opposing views may be presented and any argument put forward by way of rebuttal. In providing this opportunity the Commission shall take account of the need to preserve confidentiality and of the convenience of the parties. There shall be no obligation on any party to attend a meeting and failure to do so shall not be prejudicial to that party's case. 7. (a) This Article shall not preclude the Council from reaching preliminary determinations or from applying measures expeditiously. (b) In cases in which any interested party refuses access to, or otherwise does not provide, necessary information within a reasonable period, or significantly impedes the investigation, findings, affirmative or negative, may be made on the basis of the facts available. 8. Proceedings on unfair pricing practices shall not constitute a bar to customs clearance of the goods to which the freight rates concerned apply. 9. (a) An investigation shall be concluded either by its termination or by action pursuant to Article 11. Conclusion should normally take place within one year of the initiation of the proceeding. (b) A proceeding shall be concluded either by the termination of the investigation without the imposition of duties and without the acceptance of undertakings or by the expiry or repeal of such duties or by the lapse of undertakings in accordance with Articles 14 or 15. Article 8 Confidentiality 1. Information received in pursuance of this Regulation shall be used only for the purpose for which it was requested. 2. (a) Neither the Council, nor the Commission, nor Member States, nor the officials of any of these, shall reveal any information received in pursuance of this Regulation of which confidential treatment has been requested by its supplier, without specific permission from the supplier. (b) Each request for confidential treatment shall indicate why the information is confidential and shall be accompanied by a non-confidential summary of the information, or a statement of the reasons why the information is not susceptible of such summary. 3. Information will ordinarily be considered to be confidential if its disclosure is likely to have a significantly adverse effect upon the supplier or the source of such information. 4. However, if it appears that a request for confidentiality is not warranted and if the supplier is either unwilling to make the information public or to authorize its disclosure in generalized or summary form, the information in question may be disregarded. The information may also be disregarded where such request is warranted and where the supplier is unwilling to submit a non-confidential summary, provided that the information is susceptible of such summary. 5. This Article shall not preclude the disclosure of general information by the Community authorities and in particular of the reasons on which decisions taken in pursuance of this Regulation are based, or disclosure of the evidence relied on by the Community authorities insofar as necessary to explain those reasons in court proceedings. Such disclosure must take into account the legitimate interest of the parties concerned that their business secrets should not be divulged. Article 9 Termination of proceedings where protective measures are unnecessary 1. If it becomes apparent after consultation that protective measures are unnecessary, then, where no objection is raised within the Advisory Committee referred to in Article 6 (1), the proceeding shall be terminated. In all other cases the Commission shall submit to the Council forthwith a report on the results of the consultation, together with a proposal that the proceeding be terminated. The proceeding shall stand terminated if, within one month, the Council, acting by a qualified majority, has not decided otherwise. 2. The Commission shall inform the parties known to be concerned and shall announce the termination in the Official Journal of the European Communities setting forth its basic conclusions and a summary or the reasons therefor. Article 10 Undertakings 1. Where, during the course of investigation, undertakings are offered which the Commission, after consultation, considers acceptable, the investigation may be terminated without the imposition of redressive duties. Save in exceptional circumstances, undertakings may not be offered later than the end of the period during which representations may be made under Article 7 (4) (c) (iii). The termination shall be decided in conformity with the procedure laid down in Article 9 (1) and information shall be given and notice published in accordance with Article 9 (2). 2. The undertakings referred to under paragraph 1 are those under which rates are revised to an extent such that the Commission is satisfied that the unfair pricing practice, or the injurious effects thereof, are eliminated. 3. Undertakings may be suggested by the Commission, but the fact that such undertakings are not offered or an invitation to do so is not accepted, shall not prejudice consideration of the case. However, the continuation of unfair pricing practices may be taken as evidence that a threat of injury is more likely to be realized. 4. If the undertakings are accepted, the investigation of injury shall nevertheless be completed if the Commission, after consultation, so decides or if request is made by the Community shipowners concerned. In such a case, if the Commission, after consultation, makes a determination of no injury, the undertaking shall automatically lapse. However, where a determination of no threat of injury is due mainly to the existence of an undertaking, the Commission may require that the undertaking be maintained. 5. The Commission may require any party from whom an undertaking has been accepted to provide periodically information relevant to the fulfilment of such undertakings, and to permit verification of pertinent data. Non-compliance with such requirements shall be construed as a violation of the undertaking. Article 11 Redressive duties Where investigation shows that there is an unfair pricing practice, that injury is caused by it and that the interests of the Community make Community intervention necessary, the Commission shall propose to the Council, after the consultations provided for in Article 6, that it introduce a redressive duty. The Council, acting by a qualified majority, shall take a Decision within two months. Article 12 In deciding on the redressive duties, the Council shall also take due account of the external trade policy considerations as well as the port interests and the shipping policy considerations of the Member States concerned. Article 13 General provisions on duties 1. Redressive duties shall be imposed on the foreign shipowners concerned by regulation. 2. Such regulation shall indicate in particular the amount and type of duty imposed, the commodity or commodities transported, the name and the country of origin of the foreign shipowner concerned and the reasons on which the Regulation is based. 3. The amount of the duties shall not exceed the difference between the freight rate charged and the normal freight rate referred to in Article 3 (c). It shall be less if such lesser duty would be adequate to remove the injury. 4. (a) Duties shall be neither imposed nor increased with retroactive effect and shall apply to the transport of commodities which, after entry into force of such duties, are loaded or discharged in a Community port. (b) However, where the Council determines that an undertaking has been violated or withdrawn, the redressive duties may be imposed, on a proposal from the Commission, on the transport of commodities which were loaded or discharged in a Community port not more than 90 days prior to the date of application of these duties, except that in the case of violation or withdrawal of an undertaking such retroactive assessment shall not apply to the transport of commodities which were loaded or discharged in a Community port before the violation or withdrawal. These duties may be calculated on the basis of the facts established before the acceptance of the undertaking. 5. Duties shall be collected by Member States in the form, at the rate and according to the other criteria laid down when the duties were imposed, and independently of the customs duties, taxes and other charges normally imposed on imports of goods transported. 6. Permission to load or discharge cargo in a Community port may be made conditional upon the provision of security for the amount of the duties. Article 14 Review 1. Regulations imposing redressive duties and decisions to accept undertakings shall be subject to review, in whole or in part, where warranted. Such review may be held either at the request of a Member State or on the initiative of the Commission. A review shall also be held where an interested party so requests and submits evidence of changed circumstances sufficient to justify the need for such review, provided that at least one year has elapsed since the conclusion of the investigation. Such requests shall be adressed to the Commission, which shall inform the Member States. 2. Where, after consultation, it becomes apparent that review is warranted, the investigation shall be re-opened in accordance with Article 7, where the circumstances so require. Such reopening shall not per se affect the measures in operation. 3. Where warranted by the review, carried out either with or without reopening of the investigation, the measures shall be amended, repealed or annulled by the Community institution competent for their adoption. Article 15 1. Subject to paragraph 2, redressive duties and undertakings shall lapse after five years from the date on which they entered into force or were last amended or confirmed. 2. The Commission shall normally, after consultation and within six months prior to the expiry of the five year period, publish in the Official journal of the European Communities a notice of the impending expiry of the measure in question and inform Community shipowners known to be concerned. This notice shall state the period within which interested parties may make known their views in writing and may apply to be given a hearing by the Commission in accordance with Article 7 (5). Where an interested party shows that the expiry of the measure would again lead to injury or threat of injury, the Commission shall carry out a review of the measure. The measure shall remain in force pending the outcome of this review. Where redressive duties and undertakings lapse under this Article the Commission shall publish a notice to that effect in the Official Journal of the European Communities. Article 16 Refund 1. Where the shipowner concerned can show that the duty collected exceeds the difference between the freight rate charged and the normal freight rate referred to in Article 3 (c) the excess amount shall be reimbursed. 2. In order to request the reimbursement referred to in paragraph 1, the foreign shipowner may submit an application to the Commission. The application shall be submitted via the Member State within the territory of which the commodities transported were loaded or discharged and within three months of the date on which the amount of the redressive duties to be levied was duly determined by the competent authorities. The Member State shall forward the application to the Commission as soon as possible, either with or without an opinion as to its merits. The Commission shall inform the other Member States forthwith and give its opinion on the matter. If the Member States agree with the opinion given by the Commission or do not object to it within one month of being informed, the Commission may decide in accordance with the said opinion. In all other cases, the Commission shall, after consultation, decide whether and to what extent the application should be granted. Article 1 7 Final provisions This Regulation shall not preclude the application of any special rules laid down in agreements concluded between the Community and third countries. Article 18 Entry into force This Regulation shall enter into force on 1 July 1987. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 22 December 1986. For the Council The President G. SHAW (1) OJ No C 255, 15. 10. 1986, p. 169. (2) OJ No C 344, 31. 12. 1985, p. 31. (3) OJ No L 258, 21. 9. 1978, p. 35.

Summary: Sea transport — supply of services, competition, unfair pricing and access to ocean trade Sea transport — supply of services, competition, unfair pricing and access to ocean trade SUMMARY OF: Regulation (EEC) No 4055/86 applying the principle of freedom to provide services to maritime transport between EU countries and with non-EU countries Regulation (EEC) No 4057/86 on unfair pricing practices in maritime transport Regulation (EEC) No 4058/86 on coordinated action to safeguard free access to cargoes in ocean trades Regulation (EC) No 1/2003 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty Regulation (EC) No 246/2009 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices between liner shipping companies (consortia) Regulation (EC) No 906/2009 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices between liner shipping companies (consortia) WHAT IS THE AIM OF THE REGULATIONS? They aim to organise maritime transport in accordance with the basic principles of EU law to provide services, competition, and free access to the market in sea transport. KEY POINTS Freedom to provide services Regulation No 4055/86: grants EU-country nationals (and non-EU shipping companies using ships registered in an EU country and controlled by EU nationals) the right to carry passengers or goods by sea between any port of an EU country and any port or offshore installation of another EU country or of a non-EU country; requires any national restrictions which reserve the carriage of goods to vessels flying the national flag to be phased out or adjusted, and prevents the introduction of new restrictions; sets out a procedure for cases where EU-country shipping companies have no effective opportunity to carry goods to and from a particular non-EU country; extends the benefits of the regulation to non-EU nationals established in the EU. Regulation No 3577/92/EEC deals specifically with freedom to provide services in sea transport within EU countries (‘maritime cabotage’*). Unfair pricing in maritime transport Regulation No 4057/86: authorises the EU to apply redressive duties in order to protect shipowners in EU countries from unfair pricing practices on the part of non-EU shipowners. These redressive duties can be imposed after an investigation which demonstrates that injury has been caused by unfair pricing and that the interests of the EU make intervention necessary; concerning the examination of injury, lays down the appropriate factors or indicators to be taken into consideration, e.g. a reduction in the shipowner’s market share or profits, or the effect on employment; lays down a procedure for complaints, consultations and subsequent investigations. Free access to ocean trades Regulation No 4058/86: applies when action by a non-EU country or by its agents restricts free access to the transport of liner cargoes, bulk cargoes or other cargoes by shipping companies of EU countries or by ships registered in an EU country (except where such action is taken in conformity with the United Nations liner code); allows for coordinated action by the EU following a request made by an EU country to the European Commission. Such action might include diplomatic representation to non-EU countries and countermeasures directed at the shipping companies concerned; permits similar coordinated action to be taken at the request of another country belonging to the Organisation for Economic Cooperation and Development with which a reciprocal arrangement has been concluded. Competition rules General EU competition laws laid down in Regulation (EC) No 1/2003 also apply to the EU maritime transport sector. However, in accordance with Council Regulation (EC) No 246/2009, the Commission may make exceptions for certain types of cooperation between liner shipping* companies (consortia*). The Commission accordingly adopted Regulation (EC) No 906/2009, which allows these exceptions, and extended it until 25 April 2020 by Regulation (EU) No 697/2014. FROM WHEN DO THE REGULATIONS APPLY? Council Regulation (EEC) No 4055/86 has applied since 1 January 1987. Council Regulations (EEC) No 4057/86 and 4058/86 have applied since 1 July 1987. Council Regulation (EC) No 1/2003 has applied since 1 May 2004. Council Regulation (EC) No 246/2009 has applied since 14 April 2009. Commission Regulation (EC) No 906/2009 has applied since 26 April 2010. BACKGROUND For more information, see: ‘Internal market — Free access to ocean trade’ on the European Commission's website * KEY TERMS Cabotage: where a company which transports goods, registered in one EU country, carries out national transport in another EU country. Liner shipping: regular transport of goods on a particular route or routes between ports, at previously advertised dates and times, and available to any paying transport user, even if on an occasional basis. Consortia: agreements (or sets of agreements) between 2 or more shipping carriers which provide international liner shipping services solely for carrying cargo relating to one or more trades. Their purpose is to provide a joint maritime transport service which is better than the service that each of its members could have offered individually (i.e. without the consortium). MAIN DOCUMENTS Council Regulation (EEC) No 4055/86 of 22 December 1986 applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries (OJ L 378, 31.12.1986, pp. 1–3) Successive amendments to Regulation (EEC) No 4055/86 have been incorporated in to the original document. This consolidated version is of documentary value only. Council Regulation (EEC) No 4057/86 of 22 December 1986 on unfair pricing practices in maritime transport (OJ L 378, 31.12.1986, pp. 14–20) Council Regulation (EEC) No 4058/86 of 22 December 1986 concerning coordinated action to safeguard free access to cargoes in ocean trades (OJ L 378, 31.12.1986, pp. 21–23) Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty (OJ L 1, 4.1.2003, pp. 1–25) See consolidated version. Council Regulation (EC) No 246/2009 of 26 February 2009 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices between liner shipping companies (consortia) (Codified version) (OJ L 79, 25.3.2009, pp. 1-4) Commission Regulation (EC) No 906/2009 of 28 September 2009 on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and concerted practices between liner shipping companies (consortia) (OJ L 256, 29.9.2009, pp. 31–34) See consolidated version. last update 17.10.2016


21.11.1986 EN Official Journal of the European Communities L 326/40 THIRTEENTH COUNCIL DIRECTIVE of 17 November 1986 on the harmonization of the laws of the Member States relating to turnover taxes — Arrangements for the refund of value added tax to taxable persons not established in Community territory (86/560/EEC) THE COUNCIL OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, and in particular Articles 99 and 100 thereof, Having regard to the Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes — Common system of value added tax: uniform basis of assessment (1), and in particular Article 17 (4) thereof, Having regard to the proposal from the Commission (2), Having regard to the opinion of the European Parliament (3), Having regard to the opinion of the Economic and Social Committee (4), Whereas Article 8 of Directive 79/1072/EEC (5) on the arrangements for the refund of value added tax to taxable persons not established in the territory of the country provides that in the case of taxable persons not established in the territory of the Community, Member States may refuse refunds or impose special conditions; Whereas there is a need to ensure the harmonious development of trade relations between the Community and third countries based on the provisions of Directive 79/1072/EEC, while taking account of the varying situations encountered in third countries; Whereas certain forms of tax evasion or avoidance should be prevented, HAS ADOPTED THIS DIRECTIVE: Article 1 For the purposes of this Directive: 1. ‘A taxable person not established in the territory of the Community’ shall mean a taxable person as referred to in Article 4 (1) of Directive 77/388/EEC who, during the period referred to in Article 3 (1) of this Directive, has had in that territory neither his business nor a fixed establishment from which business transactions are effected, nor, if no such business or fixed establishment exists, his permanent address or usual place of residence, and who, during the same period, has supplied no goods or services deemed to have been supplied in the Member State referred to in Article 2, with the exception of: (a) transport services and services ancillary thereto, exempted pursuant to Article 14 (1) (i), Article 15 or Article 16 (1), B, C and D of Directive 77/388/EEC; (b) services provided in cases where tax is payable solely by the person to whom they are supplied, pursuant to Article 21 (1) (b) of Directive 77/388/EEC; 2. ‘Territory of the Community’ shall mean the territories of the Member States in which Directive 77/388/EEC is applicable. Article 2 1. Without prejudice to Articles 3 and 4, each Member State shall refund to any taxable person not established in the territory of the Community, subject to the conditions set out below, any value added tax charged in respect of services rendered or moveable property supplied to him in the territory or the country by other taxable persons or charged in respect of the importation of goods into the country, in so far as such goods and services are used for the purposes of the transactions referred to in Article 17 (3) (a) and (b) of Directive 77/388/EEC or of the provision of services referred to in point 1 (b) of Article 1 of this Directive. 2. Member States may make the refunds referred to in paragraph 1 conditional upon the granting by third States of comparable advantages regarding turnover taxes. 3. Member States may require the appointment of a tax representative. Article 3 1. The refunds referred to in Article 2 (1) shall be granted upon application by the taxable person. Member States shall determine the arrangements for submitting applications, including the time limits for doing so, the period which applications should cover, the authority competent to receive them and the minimum amounts in respect of which applications may be submitted. They shall also determine the arrangements for making refunds, including the time limits for doing so. They shall impose on the applicant such obligations as are necessary to determine whether the application is justified and to prevent fraud, in particular the obligation to provide proof that he is engaged in an economic activity in accordance with Article 4 (1) of Directive 77/388/EEC. The applicant must certify, in a written declaration, that, during the period prescribed, he has not carried out any transaction which does not fulfil the conditions laid down in point 1 of Article 1 of this Directive. 2. Refunds may not be granted under conditions more favourable than those applied to Community taxable persons. Article 4 1. For the purposes of this Directive, eligibility for refunds shall be determined in accordance with Article 17 of Directive 77/388/EEC as applied in the Member State where the refund is paid. 2. Member States may, however, provide for the exclusion of certain expenditure or make refunds subject to additional conditions. 3. This Directive shall not apply to supplies of goods which are or or may be exempted under point 2 of Article 15 of Directive 77/388/EEC. Article 5 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 1 January 1988 at the latest. This Directive shall apply only to applictions for refunds concerning value added tax charged on purchases of goods or services invoiced or on imports effected on or after that date. 2. Member States shall communicate to the Commission the main provisions of national law which they adopt in the field covered by this Directive and shall inform the Commission of the use they make of the option afforded by Article 2 (2). The Commission shall inform the other Member States thereof. Article 6 Within three years of the date referred to in Article 5, the Commission shall, after consulting the Member States, submit a report to the Council and to the European Parliament on the application of this Directive, particularly as regards the application of Article 2 (2). Article 7 As from the date on which this Directive is implemented, and at all events by the date mentioned in Article 5, the last sentence of Article 17 (4) of Directive 77/388/EEC and Article 8 of Directive 79/1072/EEC shall cease to have effect in each Member State. Article 8 This Directive is addressed to the Member States. Done at Brussels, 17 November 1986. For the Council The President N. LAWSON (1) OJ No L 145, 13. 6. 1977, p. 1. (2) OJ No C 223, 27. 8. 1982, p. 5 and OJ No C 196, 23. 7. 1983, p. 6. (3) OJ No C 161, 20. 6. 1983, p. 111. (4) OJ No C 176, 4. 7. 1983, p. 22. (5) OJ No L 331, 27. 12. 1979, p. 11.

Summary: Refunds to non-EEC taxable persons (13th VAT Directive) Refunds to non-EEC taxable persons (13th VAT Directive) The purpose of this document is to harmonize further Member State legislation concerning VAT refunds to taxable persons outside the EEC. ACT 13th Council Directive 86/560/EEC of 17 November 1986 on the harmonization of the laws of the Member States relating to turnover tax arrangements for the refund of value-added tax to taxable persons not established in Community territory [Official Journal L 326 of 21.11.1986]. SUMMARY A taxable person not established in the territory of the Community is defined as someone who has not had a business address, or a permanent place of residence in a Member State during a period of time to be determined by the Member State, and has not supplied any goods or services in that Member State with the exception of transport services or those on which tax is payable by the customer alone. In general, Member States will refund any VAT paid by a non-EC taxable person on goods or services supplied by a taxable individual in the territory of the Community. Such refunds may be made conditional on third countries agreeing to take comparable measures (reciprocity). Refunds have to be applied for by the non-EEC taxable person. Member States will determine the practical arrangements for claiming these refunds, e.g. time-limits or minimum amounts. They may also require the appointment of a tax representative. They will take all necessary steps to prevent fraud. These refunds must not be made on more favourable conditions than those made to taxable persons established in the EEC. Eligibility for refunds will be determined according to the domestic rules of the Member States for VAT deductions, although certain expenditures may be excluded or certain conditions imposed. References Act Entry into force - Date of expiry Deadline for transposition in the Member States Official Journal Directive No 86/560/EEC 11.12.1986 01.01.1988 OJ L 326 of 21.11.1986 Last updated: 31.08.2006