Marked fuel taxation: EU judgment in Case C-692/20 Commission v United Kingdom

Thursday 28th September 2023

Judgment in Case C-692/20 Commission v United Kingdom (Marked fuel)

(Taxation)

From AG Collins Opinion:

In its judgment of 17 October 2018 in Commission v United Kingdom (C‑503/17), the Court held (2) that, by allowing the use of marked fuel for the purpose of propelling private pleasure craft, even where that fuel is not subject to any exemption from or reduction in excise duty, the United Kingdom of Great Britain and Northern Ireland had failed to fulfil its obligations under Council Directive 95/60/EC of 27 November 1995 on fiscal marking of gas oils and kerosene.

On 21 December 2020, the European Commission brought the present action under Article 260 TFEU against the United Kingdom, seeking a declaration that it had failed to comply with the judgment in Case C‑503/17 and requesting that the Court impose a financial penalty.

The present action has at least three novel features. First, it is the only one of its kind taken against the United Kingdom during its membership of the European Union.

Second, it commenced during the transition period laid down in the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (‘the Withdrawal Agreement’). Third, at the expiry of that transition period, the United Kingdom was obliged to comply with the judgment in Case C‑503/17 in respect of Northern Ireland only.

In ruling upon this action, the Court is thus required to determine whether the last of these three features (a) mitigates the seriousness of the infringement and/or (b) has the consequence that the gross domestic product (GDP) of Northern Ireland, as distinct from that of the United Kingdom, is to be used to calculate the lump sum payment.

Background Documents C-692/20