Remission of customs duties and Article 116 of the UCC: a missed opportunity for a preliminary ruling

Promising questions for customs practice, but no answer from Luxembourg

The judgment of the Court of Justice of 18 December 2025 (Case C-259/24, SAS Tenergie Development) seemed to have all the makings of a landmark ruling in the field of EU customs law. A substantial additional assessment for anti-dumping and countervailing duties, an extensive OLAF investigation, requests for remission of customs duties and, on top of that, a question that has been an issue in customs practice for years: when is a Member State obliged to submit a request for remission to the European Commission under Article 116 of the Union Customs Code (UCC)?

However, those hoping for clarity on the substance of the matter were disappointed. The Court of Justice declared the preliminary questions inadmissible. Not because they were of no legal interest – on the contrary – but because, according to the Court of Justice, they were based on an insufficiently established factual premise. This leaves the key questions unanswered.

This is regrettable, but at the same time instructive. This judgment shows where things can go wrong in preliminary ruling proceedings and what lessons can be learned from this in practice.

Facts – solar panels, origin and additional tax assessment

SAS Tenergie Development is a French company that imported solar panels shipped from Taiwan to the European Union. Following an international investigation by the European Anti-Fraud Office (OLAF), the French customs authorities concluded that these panels were in fact of Chinese origin. This led to the application of anti-dumping and countervailing duties.

After an initial additional customs claim notification was withdrawn due to a violation of the right to be heard, a new additional tax assessment of approximately 2.4 million euros followed in 2020. Tenergie then submitted requests for remission to the French customs authorities. These requests were based on:

• Article 119 of the UCC (remission due to an error by the competent authorities), and
• Article 120 of the UCC (remission on grounds of equity (special circumstances without deception or obvious negligence on the part of the debtor)).

According to Tenergie, both the French customs authorities and the European Commission had already received early indications of the Chinese origin of solar panels exported via Taiwan, without informing it. In addition, it argued that the customs authorities had repeatedly accepted and processed the import declarations in question, even though all relevant documents had been submitted and – in view of the available information and risk signals – there were grounds for further investigation. According to Tenergie, the acceptance and processing of the declarations could constitute an error on the part of the competent authorities within the meaning of Article 119 of the UCC. Finally, it considered that the involvement of OLAF meant that the file should have been forwarded to the Commission in accordance with Article 116(3) of the UCC. The French customs authorities rejected the requests. The case eventually ended up before the national court, which decided to refer questions to the Court of Justice for a preliminary ruling.

Legal framework – repayment, remission and Article 116 of the UCC

Article 116 of the UCC provides the procedural framework for both repayment and remission of customs duties. The distinction between the two concepts is purely procedural in nature and depends solely on whether the customs duties have already been paid:

• repayment applies when the customs duties have already been paid;
• remission occurs when the customs duties have not yet been paid.

This follows directly from the definitions in Article 5 of the UCC. The UCC therefore makes no substantive distinction between the grounds for repayment and remission; the same material conditions apply. The UCC recognises four reasons for repayment or remission, namely:

• overcharged import duties (Article 117 of the UCC);
• actual defectiveness of the goods or contractual non-conformity (Article 118 of the UCC);
• error on the part of the competent customs authorities (Article 119 UCC);
• equity (Article 120 UCC);

This case concerned requests for remission based on:

• Article 119 UCC: an error by the competent authorities which the debtor could not reasonably have discovered and where he acted in good faith;
• Article 120 UCC: concerning special circumstances where there was no deception or obvious negligence on the part of the debtor.

Article 116(3) of the UCC then specifies the cases in which a request for repayment or remission must be submitted by Member States to the European Commission. That was the crux of the referral case. The crux of the referral case was the question of whether the French customs authorities should have proceeded with the transmission of the file in these circumstances. This article stipulates that the customs authorities shall submit the file to the Commission for a decision if they consider that repayment or remission should be granted on the basis of Articles 119 or 120 of the UCC and one of the following situations arises:

• where the customs authorities consider that the special circumstances referred to in Article 120 of the UCC are the result of the Commission's failure to fulfil its obligations;
• where the customs authorities consider that the European Commission has made an error within the meaning of Article 119 of the UCC;
• where the circumstances of the specific case are related to the results of an investigation carried out by the Union, such as an investigation by OLAF;
• where the amount for which the person concerned may be liable, as a result of an error or special circumstances, reaches or exceeds the threshold amount of EUR 500,000.

The key question in Tenergie was whether such transmission is mandatory once the conditions of Articles 119 or 120 of the UCC are met.

The preliminary questions – legally sharp, but factually vulnerable

The French court referred three preliminary questions to the Court of Justice, summarised as follows:

1. in the hypothetical event that a company, as in the present case, meets the conditions set out in Articles 119 and 120 of the UCC, is there an obligation for customs to forward the file to the Commission?
2. if the answer to the first question is that the national customs authorities are bound in that case by their power to submit the file (i.e. the power to transmit the file also constitutes an obligation to do so), does the failure to forward the file lead to the remission of the duties?
3. Can the Member State be liable for damages in the event of incorrect application of Article 116(3) of the UCC?

Unfortunately, however, the Court of Justice did not address these questions. The reason for this was not substantive, but procedural: the questions were based on the assumption that the conditions of Articles 119 and 120 of the UCC had been met, without the referring court having actually established or substantiated this fact.

In fact, an earlier ruling by the same court seemed to suggest the opposite. When asked, the national court also indicated that it had not yet formed a definitive opinion on this matter.

This meant that the necessary factual basis was lacking, and the questions were therefore considered hypothetical by the Court.

Acceptance of declarations: mistake or not?

An aspect of this case that we find interesting in terms of content – but which remained unanswered – concerns the question of whether the acceptance of customs declarations for import, when all the required documents have been submitted, can qualify as an error on the part of the customs authorities within the meaning of Article 119 of the UCC. Tenergie had argued that this was the case.

The Court's case law shows that the mere acceptance of a declaration or the lack of immediate intervention is, in principle, insufficient to constitute an error. Customs is not obliged to carry out an in-depth origin or anti-fraud investigation for every declaration. In other words, an error generally requires active conduct. However, this can also be an omission. This shifts the discussion from individual actions to the question of the extent to which structural shortcomings in supervision and risk selection can be attributed to the authorities.

We believe that acceptance may be relevant in certain circumstances. In particular, when customs had concrete indications that gave rise to further investigation, its risk selection or control systems were structurally deficient, or declarations were accepted that, in view of the available information and customs' own risk profile, should not (without further ado) have been accepted.

In such cases, we believe it can be argued that it is not so much an individual action as the design and operation of the declaration and control system itself that constitutes an error. It is precisely this systemic dimension that makes this point so relevant in practice, particularly in complex origin and anti-dumping issues.

What went wrong when the case was referred to Luxembourg and what could have been done differently?

The crux of the problem in Tenergie is that the preliminary questions were asked before it had actually been established whether the conditions for remission had been met. This meant that the necessary gateway to Article 116 of the UCC was missing.

A different sequence might well have led to a substantive ruling:

• first determine whether there has been an error (Article 119 of the UCC) or special circumstances (Article 120 of the UCC);
• only then ask what consequences this has for the obligation to forward the information to the Commission.

The Court of Justice uses this judgment to emphasise once again what the preliminary ruling procedure is and, above all, what it is not. Luxembourg is not a place where national courts can seek general opinions or submit open questions 'just to be on the safe side'. The Court does not act as an advisory body or an academic source of information. It only rules when this is really necessary for the resolution of the specific dispute before the national court. If there is insufficient factual basis, or if the questions asked are based on a hypothetical assumption, the Court will not intervene. In Tenergie, this meant that the substantively interesting questions about Article 116 of the UCC remained unanswered for the time being.

And now? – postponement, not definitive rejection

In its judgment, the Court of Justice explicitly leaves open the possibility for the national court to refer preliminary questions again, provided that the court refines the factual basis. The discussion on Article 116 of the UCC is therefore not over, but may only have been postponed. It remains to be seen, of course, whether there will be a follow-up. In summary: anyone who asks Luxembourg a question must first dare to decide for themselves.

Practical lessons for customs practice

First and foremost, the Tenergie judgment shows that any claim for repayment or remission of customs duties stands or falls on the basis of careful factual substantiation. It therefore requires precision. Without a clear determination that there has actually been an error within the meaning of Article 119 of the UCC or special circumstances as referred to in Article 120 of the UCC, the application of Article 116 of the UCC simply does not come into play.

At the same time, we think it is a missed opportunity that the Court was not able to comment on a question that is really important in practice: does Article 116(3) of the UCC just give customs authorities the power to transmit a file to the Commission, or does that provision actually create an obligation in certain circumstances? How should the words ‘Where the customs authorities consider […]’ be interpreted?   Nor has it become clear to what extent the national court can assess whether the customs authorities should have considered that the conditions of Article 119 or 120 of the UCC were met, or whether the customs authorities can, possibly wrongly, autonomously reject this assessment without effective judicial review. This also leaves open the question of how to deal with situations in which customs authorities refuse to submit a request, precisely at the point where the legal protection of market participants is most at stake. This provision therefore directly addresses the question of whether market participants enjoy effective judicial protection against a (possibly incorrect) refusal to transmit a request.

Finally, Tenergie contains a clear lesson about the preliminary ruling procedure itself. Substantively promising questions only reach Luxembourg when they are based on a solid factual basis. Anyone asking the Court for guidance will first have to make up their own mind. Without that sequence, there will be no answer – no matter how relevant the question is to customs practice.

Ploum Customs Practice

Ploum’s international trade and customs practice  advises and litigates on all aspects of European customs law, including anti-dumping and countervailing measures, origin and valuation, customs debts and remission of duties. Jikke Biermasz  and Arjan Wolkers among others, assist market participants in complex customs and trade law issues, both in an advisory capacity and in proceedings before national courts and the Court of Justice of the European Union.