[관세등부과처분무효확인등][공2016하,1396]
[1] Purport that the former Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements and the Free Trade Agreement between the Republic of Korea and the EFTA States establish an indirect verification system under the indirect verification method / The standard for determining whether the customs authority of the exporting Party’s failure to reply within the response period against a request for origin verification made by the customs authority of the importing Party constitutes an exceptional case as stipulated in Article 24(7) of Annex I of the Free Trade Agreement between the Republic of Korea and the EFTA States
[2] The case holding that in a case where Switzerland customs authority failed to comply with a request for verification of origin or failed to provide sufficient information within a period of time prescribed in the Free Trade Agreement, on the grounds that the head of the competent customs office limited the application of the conventional tariff rate of 10 months to Switzerland and imposed customs duties and value-added tax on Switzerland on Switzerland, and the gold bars produced by Switzerland customs authority did not correspond to Switzerland upon the expiration of the response period, on the grounds that the gold bars produced by Switzerland did not correspond to Switzerland with the origin of Switzerland, although the origin of Switzerland was Switzerland and Switzerland produced by Switzerland, and the gold bars produced by Switzerland did not correspond to Switzerland, were the origin of Switzerland and the gold bars produced by Switzerland are part of Switzerland, and the head of the competent customs office did not comply with the request for verification of origin, and did not respond to Switzerland within the response period of 10 months
[1] The former Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements (amended by Act No. 9918, Jan. 1, 2010; hereinafter “FTA”) and the Free Trade Agreement between the Republic of Korea and an EFTA State (hereinafter “Free Trade Agreement”) aim at establishing a free trade zone between the Parties to an agreement and strengthening the ties, and at the same time expanding trade and investment flows between the Parties, creating new employment opportunities and increasing living standards, and ensuring the continued increase in real income. To this end, the Free Trade Agreement Customs Act and the Free Trade Agreement provide that the customs authority of the importing Party shall apply the conventional tariffs to the import and export of goods originating in the country of origin on the basis of mutual trust of the Parties in order to verify the origin requirements for the application of the Free Trade Agreement. In other words, the customs authority of the importing Party’s reply to verification that an indirect verification method conducted by the customs authority of the exporting Party is not made within 10 months after the submission of the import Party’s reply to verification within the period of time limit.
[2] Where Company A, a domestic corporation, imported Switzerland’s Switzerland and Switzerland’s 2 gold bars produced by Byung, and filed an import declaration by applying 0% of the conventional tariff rates stipulated in the Free Trade Agreement between the Republic of Korea and the EFTA States (hereinafter “Free Trade Agreement”), and the head of the competent customs office replys that the Switzerland’s request for origin verification does not constitute Switzerland and did not reply within 10 months, on the grounds that the head of the competent customs office restricted the application of the conventional tariff rates and imposed customs duties and value-added taxes on each gold leader by applying the basic tariff rate of 3% after the lapse of the response period, and that the gold bars produced by the Switzerland did not constitute Switzerland’s origin, but the gold bars produced by the Switzerland was not the Switzerland’s origin and that some finished products produced by the Switzerland were the origin of the Switzerland, and that the customs office did not comply with the first reply to the Korea Customs Service’s request for origin verification within the same period of origin, and that the customs authority did not comply with the first reply to the customs authority’s reply.
[1] Article 16(1)2 (see current Article 35(1)2) of the former Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements (Amended by Act No. 9918, Jan. 1, 2010); Article 24 subparag. 1 (see current Article 37 subparag. 4) of the former Enforcement Rule of the Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements (Amended by Ordinance of the Ministry of Strategy and Finance No. 180, Dec. 31, 2010); Article 10.2 of the Free Trade Agreement between the Republic of Korea and the EFTA States; Article 24(6) and (7) of the Annex I to the Free Trade Agreement between the Republic of Korea and the EFTA States / [2] Article 16(1)2 of the former Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements (Amended by Act No. 9918, Jan. 1, 2010); Article 24 subparag. 16(2)3) of the former Enforcement Rule of the Free Trade Agreements
ABP Co., Ltd. (Attorneys Son Ji-yol et al., Counsel for the defendant-appellant)
Head of Daegu Customs Office (Law Firm LLC, Attorneys Gangnam-gu et al., Counsel for the defendant-appellant)
Daegu High Court Decision 2013Nu933 decided January 24, 2014
The appeal is dismissed. The costs of appeal are assessed against the plaintiff.
The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).
1. As to the grounds of appeal Nos. 3 and 4
A. Article 16(1) of the former Act on Special Cases of the Customs Act for the Implementation of Free Trade Agreements (amended by Act No. 9918, Jan. 1, 2010; hereinafter “Free Trade Agreements”) provides that “Except as otherwise provided by an agreement, the head of a customs office may choose not to apply conventional tariffs to the relevant imported goods in any of the following cases,” and subparagraph 2 of Article 13(1) provides that “where the customs office of a Contracting State or the head of a customs office fails to respond to the request of the customs authority of a Contracting State for the verification of origin within the period prescribed by Ordinance of the Ministry of Strategy and Finance, or where the customs authority of a Contracting State confirms that the reported origin differs from the actual origin or requests the head of a customs office to verify the accuracy of the origin pursuant to Article 9 of the Free Trade Agreement, or where the head of a customs office fails to respond to a request for the verification of origin pursuant to Article 10(1)1 of the former Enforcement Rule of the Free Trade Agreement for the implementation of the Free Trade Agreement (amended by Ordinance No. 10106).
Meanwhile, Article 10.2 of the Free Trade Agreement between the Republic of Korea and the EFTA States (hereinafter “instant Free Trade Agreement”) provides that the Annexes and Appendix of the Agreement shall be an integral part of the Agreement, and accordingly, Annex I of the instant FTA provides that “the customs authority requesting verification shall receive the results of verification, including the findings and facts, and all relevant documentary evidence of the exporter, as far as possible,” with respect to the verification of the origin declaration, and that the request for verification shall have the authority to exclude preferential tariff treatment except in cases where there is no reply within 10 months from the date of the request for verification or where there is no sufficient information to determine the authenticity of the relevant documents or the origin of the goods are not included in sufficient information to determine the origin of the goods.
The purpose of the Free Trade Agreement Customs Act and the instant FTA is to create new employment opportunities, enhance living standards, and ensure the continuous increase of real income by establishing a free trade zone between the Parties to the agreement at the same time strengthening the ties, and by removing trade barriers between the Parties to trade and investment flows. To this end, the Free Trade Agreement Customs Act and the instant Free Trade Agreement provide that the customs authority of the importing Party shall apply the conventional tariffs eliminating or gradually lowering customs duties on the imports and exports of goods originating in the country of origin, and shall share their roles on the basis of mutual trust between the Parties for verification of origin, which is the applicable requirements. In other words, the customs authority of the importing Party shall, in principle, respect the results of verification conducted by the customs authority of the exporting Party, provided that the customs authority of the importing Party shall, in principle, respect the results of verification responded to the submission by the customs authority of the exporting Party, but, if no response is made within 10 months or sufficient information to determine the authenticity of the relevant documents or the origin of the goods is presented, the customs authority of the importing Party shall not grant any indirect verification and reply within the objective period of origin verification.
B. 1) The lower court acknowledged the following facts based on the evidence duly admitted.
① The Plaintiff, via the Hong Kong Switzerland Bank, imported each of the instant gold bars and the instant gold bars produced by Cambodia, which is an exporter, and the Plaintiff filed an import declaration by attaching the origin declaration indicated in Switzerland, and applying 0% of the conventional tariff rates stipulated in the instant FTA.
② Upon the Defendant’s request for an origin verification regarding each of the instant gold bars in accordance with the instant FTA, the Switzerland customs authority sent a reply to the purport that the origin declaration was issued erroneously for the reason that the origin declaration was not the Switzerland, since the origin was not the Switzerland, and that the instant gold bars produced by Switzerland was not the Switzerland. The response was not made within ten months of the response period.
③ On September 2, 2008, the Defendant restricted the application of the conventional tariff rate on the grounds that the place of origin was not the Switzerland, and imposed customs duties and value-added taxes on the Plaintiff by applying the basic tariff rate of 3%. On July 29, 2009, the Defendant issued the second disposition imposing customs duties and value-added taxes on the Switzerland on the ground that the Switzerland customs authority did not reply to the result of origin verification within the response period.
④ After the lapse of the response period, the Swiss customs authority reversed the initial reply with the purport that the gold bars produced by Cambodia are originating Switzerland, but the gold bars produced by Cambodia are originating Switzerland, while the gold bars produced by Mussler reversed the initial reply with the purport that the origin is Switzerland. The gold bars produced by Mussler were the origin of some of them.
⑤ In the process of the instant lawsuit, the Defendant added the following facts to each of the instant dispositions: (a) the Switzerland customs authority did not send replies within 10 months, which is the response period stipulated in the instant FTA; and (b) the final reply sent after the lapse of the response period to each of the instant dispositions did not include the authenticity of the relevant documents or sufficient information to determine the origin of the goods.
2) The lower court held that, in light of the following facts: ① the Korea Customs Service after the initial response had observed the verification process of the Switzerland customs authority’s Switzerland, there was no special circumstance to see otherwise from the initial response; and the Geneva Customs Service presented a provisional opinion that raw materials and finished products of each leader of this case fall under the same HS tariff classification and failed to meet the origin requirements; ② the Defendant appears to have been unable to expect the Switzerland customs authority to wait for an additional response beyond the response period; ② the Switzerland and Cambodia filed a lawsuit against the Switzerland customs authority seeking the revocation of the initial determination of the Switzerland conflict of origin; however, the Switzerland customs authority failed to provide the Switzerland customs authority with a specific verification during the appeal trial, and subsequently revoked the initial determination and presented the final reply of this case, and determined that the Switzerland customs authority’s submission of the evidence of this case could not be justified on the sole ground that it did not comply with the requirement of origin, and thus, the Switzerland customs authority did not present any objective evidence and reply within the scope of the Switzerland reply.
C. Examining the above provisions, legal principles, and records, there were some parts of the reasoning of the court below, but the court below did not err by misapprehending the legal principles as to the interpretation of "other exceptional cases" and the concept of sufficient information under Article 24 (7) of Annex I to the Free Trade Agreement, contrary to the allegations in the grounds of appeal.
2. As to the grounds of appeal Nos. 1 and 2
The gist of this part of the grounds of appeal is not only the defendant who is the tax authority, but also the defendant who bears the burden of proving the origin of each gold leader of this case, and even if based on the evidence submitted by the plaintiff, it has been sufficiently proven that the origin of each gold leader of this case was Switzerland. However, the court below erred by misapprehending the legal principles on the burden of proof, or by misapprehending the rules of logic and experience.
Examining the reasoning of the judgment below, this part of the judgment of the court below is nothing more than a family or additional judgment attached to the judgment premised on the premise that each of the dispositions of this case was the cause of disposition for delay of reply and provision of insufficient information by the Switzerland customs authority. As seen earlier, the judgment of the court below did not affect the conclusion of the judgment, insofar as the judgment of the court below that there was a circumstance corresponding to "other exceptional cases" as stipulated in the Free Trade Agreement, the legitimacy of such a family judgment does not affect the conclusion of the judgment. Thus,
3. As to the fifth ground for appeal
After finding the facts as stated in its holding, the court below determined that the part of the lawsuit on revocation of the disposition of this case of this case of this case of this case of this case of this case of this case is unlawful because it did not go through the previous trial procedure, since it is common in that the origin of gold bullion imported from Switzerland was at issue, but it does not fall under the case where the same purpose disposition was conducted in the course of the phased and developmental process, or the taxation disposition subject to it was changed during the tax litigation, or it did not fall under the case where the previous trial procedure for the disposition of this case of this case of this case of this case of this case of this case of this case of this case of this case of this case of this case of this case of this case of the previous trial procedure of the first instance.
Examining the record in light of the relevant legal principles, the lower court did not err in its judgment by misapprehending the legal doctrine on the mitigation of the requisite transfer principle in a tax lawsuit.
4. Conclusion
Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.
Justices Park Poe-dae (Presiding Justice)