In 1972 a decree of the President of the Republic introduced an administrative charge for the registration in the register of companies of various company documents (formation, increase of capital, extension of the company's duration, change of the company's objects or type, merger etc); the amount varied according to the form of the company for the instrument of incorporation and there was a single rate for other documents. From 1984 the charge for registration of the instrument of incorporation was payable annually.

In 1993 the Court of Justice gave judgment in the Ponente Carni case, as a result of which several Italian courts declared the administrative charge to be contrary to Directive 69/335/EEC concerning indirect taxes on the raising of capital. However, the Court of Justice also ruled that duties paid by way of fees or dues calculated according to the costs of operations required by law in the public interest are lawful, even, subject to certain conditions, if they are assessed on a flat- rate basis.

A decree-law of 1993 thereupon fixed single amounts of ITL 500 000 for registration of the instrument of incorporation (abolishing the annual charge payable in subsequent years) and ITL 250 000 for all other documents.

Consequently, numerous actions were brought before the Italian courts for repayment of the administrative charges paid but not due between 1985 and 1992.

Against this background, the Corte di Cassazione (Court of Cassation) ruled that the repayments were subject to the time-limit of three years from the date of payment laid down by the 1972 decree with respect to charges paid in error.

The Court of Justice was asked whether such a time-limit was compatible with Community law. It ruled in judgments of 1998 (Edis and others) that the Member States retain the right to resist actions for repayment of charges levied in breach of Community law by relying on a time-limit, even if the time-limit is less generous than the time-limit for actions between private individuals for the recovery of sums paid but not due, provided that it applies both to actions based on Community law and to actions based on national law and that it is not adopted specifically to block those claims for repayment after the charges in question have been held to be incompatible with Community law.

The Court of Justice also ruled that the rules for calculating interest on the sums to be repaid can also be less generous than in actions between private individuals, provided that they are equivalent to the rules which apply to actions based on national law for charges of the same kind.

A law of 1998 (the finance law for 1999) retroactively introduced new administrative charges for the years 1985 to 1992, as follows: a (one-off) payment of ITL 500 000 for registration of the instrument of incorporation, and an annual flat-rate payment for registration of other documents. That law said that a claim for repayment of the wrongfully paid previous charges had to be brought within three years from the date of payment, and fixed a rate of interest which, according to the courts making the references to the Court of Justice, was lower than the rate which applied to similar claims based on national law.

The questions referred to the Court of Justice relate essentially to three aspects:

1. The retroactive charges

The parties argued that payment for the registration service provided had already been covered by other registry fees charged, and that in any case the charges were not payment for services rendered because some of them were levied where no registration had actually been made and because the actual costs of providing the service had not been calculated beforehand.

The Court observed that charges of this kind are prohibited by the directive unless they are duties paid by way of fees or dues.

In practice, the retroactive flat-rate charges introduced in 1998 were levied on top of similar charges already paid between 1985 and 1992; if, because of the time-limit, the latter cannot be reimbursed, then the retroactive charges cannot be regarded as being paid by way of fees or dues.

On the other hand, for companies which are able to claim repayment, it is for the national courts to ascertain whether or not the retroactive charges are paid by way of fees or dues, having regard to the criteria already laid down by the Court of Justice.

Referring to the registry fees, the Court reminded the national courts that the Member States are free to charge several payments in parallel, provided that the total does not exceed the cost of the service provided. They may also take into account the entire costs of the operations, including the proportion of overheads attributable to them.

2. The time-limit

In accordance with its case-law (Edis, 1998), the Court pointed out that the Court of Cassation's interpretation in 1996, taken over in the 1998 law, concerned a provision which was already in force before the declarations of incompatibility following the Ponente Carni judgment of 1993, and concerned all Italian administrative charges.

Consequently, national law could lay down a time-limit of three years, as an exception to the rules on recovery of sums paid but not due between private individuals, since it applied in the same way to claims for repayment based on national law.

Moreover, the time-limit does not make the exercise of rights given by Community law impossible in practice or excessively difficult, since compliance with the time-limit is assessed as at the date of bringing the claim for repayment. The 1998 law did not therefore alter the rules previously applicable.

3. The rules on calculating interest on repayments

The parties submitted that an unfavourable rate of interest is applied to repayments of the charges which were declared to be contrary to Community law following the Ponente Carni judgment.

The Court of Justice, consistently with its previous case-law, stated that the rules for repayment must apply without distinction to actions based on Community law and actions based on breach of national law. The rules for calculating interest may be less favourable for the repayment of charges wrongly levied than for the recovery of sums paid but not due between private individuals, provided that they apply in the same way to actions based on national law as to actions based on Community law.

However, the repayment of a charge which has been declared to be contrary to Community law following a judgment of the Court of Justice must not be made subject to specific conditions which are less favourable than those which would otherwise be applicable.

It is for the national court to ascertain whether on the facts of the case the interest rate laid down by the 1998 law should be disapplied.

Unofficial document for media use only; not binding on the Court of Justice. Available in English, French and Italian. For the full text of the judgment, please consult our Internet page www.curia.eu.int  at approximately 3pm today. For further information please contact Reinier van Winden: Tel: (00 352) 4303 3355; Fax: (00 352) 4303 2731 Unofficial document for media use, not binding on the Court of Justice