UT/2023/000023 - [2024] UKUT 00096 (TCC)

As regards the approach to reasoning by analogy, Mr Blades, argues it is impermissible as a matter of principle to apply the reasoning of the classification regulation to give the product sought to be classified a different eight-digit classification to that specified in the classification regulation. The classification regulation – and the eight-digit code it specified - either applied or it did not; there was no middle ground ability to diverge at the “one-dash” or “two-dash” heading level. Furthermore, no analogy with the regulation arose because Cozy Pet’s products and the products described in the classification regulation were insufficiently similar. The reasons stated in the regulation mentioned the fabric covering there was woven whereas the plush fabric on Cozy Pet’s products was knitted. That distinction was, Mr Blades argued, fatal to the application of the classification regulation.

Ms Brown accepted there were limits to the application of reasoning by analogy; it could not for instance be used to argue for an entirely different chapter heading to that specified by the regulation. However, she submits it was possible to use the reasons but then apply a slightly different sub-heading.

In support of his submission, Mr Blades relied on the CJEU case of Grofa which concerned the customs classification of a GoPro camera. The CJEU explained (at [38]) that to apply by analogy the goods to be classified and those covered by the regulation had to be sufficiently similar and that in that regard it was necessary to take into account the reasons given for that regulation. The CJEU proceeded to set out (at [39]) the reasons in the classification regulation that was relevant there (Implementing Regulation No 1249/2011) which concerned the classification of “pocket sized video recorders”. The classification was justified inter alia on the basis the apparatus was “only capable of recording video”. The CJEU continued:

“It follows that the inability to take photographs constitutes one of the decisive factors for the classification used in that regulation. However, it is apparent from the decision to refer in Case C-435/15 that the cameras at issue differ in that respect from ‘pocket sized videorecorders’, which are the subject of Implementing Regulation No 1249/2011, since they can take photographs.”

The CJEU’s decision cannot however, in our view, stand as authority for the point of principle that Mr Blades advances. At a basic level, Grofa is not a case where one party was seeking to rely on the reasoning set out in the classification regulation to achieve a different classification to that set out in the regulation but where the court was then ruling that impermissible. On the contrary the reasoning in Grofa suggests the proper approach is to analyse the reasons given in the regulation to see which factors mentioned there are decisive and then to determine whether such factors are present in the product under consideration. As Ms Brown correctly pointed out, the CJEU’s decision was that a decisive factor in classification under the relevant heading there was whether the article was only able to take video. It did not follow that simply because a feature was mentioned in the regulation that it was a decisive factor. The analysis of what was decisive needed to be considered in the light of the whole reasoning and the competing classifications mentioned in the reasoning.

Mr Blades also referred to Kreyenhop & Kluge GmbH (C-471/17) but that too is simply an example of the CJEU finding that the article in question (instant fried noodles) was not sufficiently similar to the noodle product covered by the classification regulation under consideration. (That regulation did not specify whether the product it covered had been fried during manufacture and in circumstances where the CJEU noted that that characteristic was what was decisive in the referral before them). Again, the case does not establish that the classification regulation could only apply so as to give rise to the same eight-digit classification and that if it did not then its reasoning was irrelevant.