UK smokers must pay full 'Death' duty

LAW REPORT: 1 June 1995

Regina v Customs and Excise Commissioners, ex parte Emu Tabac SARL and others.

Queen's Bench Division (Mr Justice Popplewell).

26 May 1995.

A scheme whereby smokers in the United Kingdom purchased "Death" and other brands of cigarettes in quantities of up to 800 at a time via an agent from a supplier in Luxembourg, and thus paid up to 40 per cent less in excise duty than if they had bought the cigarettes in the UK, was not permitted under the rules establishing the European internal market.

Mr Justice Popplewell refused four applications for judicial review challenging the detention or threatened detention, by the Customs and Excise Commissioners, of consignments of tobacco products purchased in Luxembourg or elsewhere in the EU and brought into the UK without payment of UK excise duty, and the decision of the commissioners, in a letter dated 21 February 1995, that UK excise duty is exigible in respect of such products under article 10 of European Community Council Directive 92/12/EEC.

The application was brought by (1) Emu Tabac SARL, a Luxembourgeois tobacconist, (2) The Man in Black Ltd, a UK company purporting to act as the agent of UK purchasers of cigarettes from the first applicant in Luxembourg, and (3) John Anthony Cunningham, a director of the second applicant company. Both the first applicant company and second (which traded as Tobacco Direct) were subsidiaries of the Enlightened Tobacco Co, manufacturers of Death cigarettes.

Also involved in the case was Imperial Tobacco Ltd, which was granted leave to intervene to argue that to allow the applicants' scheme to go ahead would cause considerable disruption to the UK tobacco industry.

Robert Venables QC, Timothy Lyons and Amanda Hardy (Thomas Eggar Verral Bowles, Horsham) for the applicants; Stephen Richards and Robert Jay (Customs & Excise Solicitors) for the Commissioners; David Vaughan QC and Mark Brealey (Gouldens), Imperial Tobacco.

MR JUSTICE POPPLEWELL said the applicants' case was that since a purchaser going personally to Luxembourg and bringing back cigarettes for personal consumption would pay only Luxembourg duty, the same must be true if the purchaser employed an agent, ie the second applicant, who personally went to Luxembourg on his behalf. They relied on article 8 of the Directive, which stated: "As regards products acquired by private individuals for their own use and transported by them, the principle governing the internal market lays down that excise duty shall be charged in the Member State in which they are acquired." They contended that products might be "acquired" and "transported" by a private individual through someone else doing it on their behalf.

The Commissioners argued that the scheme fell within article 10(1) of the Directive: "Products subject to excise duty purchased by persons who are not authorised wharehousekeepers or registered or non-registered traders and dispatched or transported directly or indirectly by the vendor or on his behalf shall be liable to excise duty in the Member State of destination."

Both the Commissioners and Imperial Tobacco argued the scheme was covered by UK legislation made in conformity with the Directive, namely the Excise Goods (Holding, Movement, Warehousing - REDS) Regulations 1992 and Excise Duties (Personal Reliefs) Order 1992. Having looked at article 8 in the light of the other provisions and of the history and purpose of the Directive, and having compared the language used both in its English form and more helpfully in the language used in the other Member States, his Lordship had decided that it did not encompass the use of an agent.

Under the Directive, a clear distinction was to be drawn between the purchase by an individual personally under article 8 and what was in effect a commercial exercise to be governed by article 10. The relevant UK legislation did give effect to the Directive and accordingly the application must be refused.

Paul Magrath, Barrister.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm tomorrow
News
Elton John and David Furnish will marry on 21 December 2014
people
News
people
Arts and Entertainment
Caroline Flack became the tenth winner of Strictly Come Dancing
tvReview: 'Absolutely phenomenal' Xtra Factor presenter wins Strictly Come Dancing final
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Life and Style
A still from the 1939 film version of Margaret Mitchell's 'Gone with the Wind'
life
Arts and Entertainment
J Jefferson Farjeon at home in 1953
booksBooksellers say readers are turning away from modern thrillers and back to golden age of crime writing
Sport
Amir Khan is engaged in a broader battle than attempting to win a fight with Floyd Mayweather
boxing Exclusive: Amir Khan reveals plans to travel to Pakistan
News
Stacey Dooley was the only woman to be nominated in last month’s Grierson awards
mediaClare Balding and Davina McCall among those overlooked for Grierson awards
Voices
Joseph Kynaston Reeves arguing with Russell Brand outside the RBS’s London offices on Friday
voicesDJ Taylor: The great tradition of St Paul and Zola reached its nadir with a worker's rant to Russell Brand
News
Twitchers see things differently, depending on their gender
scienceNew study shows that birdwatching men have a lot in common with their feathered friends...
News
i100
News
Xander van der Burgt, at the Royal Botanic Gardens, Kew
scienceA Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Austen Lloyd: Senior Private Client Solicitor

Excellent Salary: Austen Lloyd: SURREY - An outstanding high level opportunity...

Austen Lloyd: Construction Solicitor - London

Very Competitive Salary : Austen Lloyd: NICHE CITY FIRM - We are making a disc...

Austen Lloyd: Construction Solicitor - London

Very Competitive Salary : Austen Lloyd: NICHE CITY FIRM - We are making a disc...

Recruitment Genius: Finance Director

£65000 - £80000 per annum: Recruitment Genius: Finance Director required to jo...

Day In a Page

The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'
Marian Keyes: The author on her pre-approved Christmas, true love's parking implications and living in the moment

Marian Keyes

The author on her pre-approved Christmas, true love's parking implications and living in the moment
Bill Granger recipes: Our chef creates an Italian-inspired fish feast for Christmas Eve

Bill Granger's Christmas Eve fish feast

Bill's Italian friends introduced him to the Roman Catholic custom of a lavish fish supper on Christmas Eve. Here, he gives the tradition his own spin…
Liverpool vs Arsenal: Brendan Rodgers is fighting for his reputation

Rodgers fights for his reputation

Liverpool manager tries to stay on his feet despite waves of criticism
Amir Khan: 'The Taliban can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'

Amir Khan attacks the Taliban

'They can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'
Michael Calvin: Sepp Blatter is my man of the year in sport. Bring on 2015, quick

Michael Calvin's Last Word

Sepp Blatter is my man of the year in sport. Bring on 2015, quick