Broomco (1984) Ltd v Commissioners of Customs and Excise

Facts

Broomco (1984) Ltd, formerly Anchor Foods Ltd, imported butter from New Zealand between 7 March 1994 and 8 December 1997 accompanied by certificates that it satisfied the conditions for preferential access to the European Community. Before 1 July 1995 the preferential arrangements derived from Protocol 18 to the Treaty of Accession of 22 January 1972 and subsequent European regulations, in particular Council Regulation (EEC) No 858/81, with certificates issued by the New Zealand High Commission; from 1 July 1995 they were governed by Commission Regulation (EC) No 1600/95, made following the Marrakesh Agreement establishing the World Trade Organisation, with IMA 1 certificates issued by the New Zealand Dairy Board. UK Customs raised seven post-clearance demands totalling £23,068,836.79 on the footing that, although the New Zealand authorities had issued certificates, the butter had not been manufactured directly from milk or cream and so did not meet the criteria for preferential access. No fraud or bad faith was alleged. Numerous further appeals by the appellant and an associated company, involving around £100 million, were stood over. A preliminary issue was directed for hearing before the VAT and Duties Tribunal: whether, assuming the certificates were incorrect, the Commissioners were entitled to raise post-clearance demands for the difference between the quota rate and the full rate of duty.