The customs refused again - this time in the payment of interest – appealing to the lack of established procedure for the return of overpaid customs duties, and now the third series of trials between the Customs and TNK-BP began.
The Moscow State Arbitrazh supported the Federal Customs Service, stating in its decision of 23 June 2010 that the customs is authorized to conduct its business solely on the basis of law and in strict accordance with it, but in the law, despite the fact that it provides for the payment of interest, neither the procedure nor the terms for repayment are established. The Federal Customs Service on its own initiative and in the absence of a clearly specified procedure cannot make such payments.
Nevertheless, in September 2010 the Court of Appeal reversed the above decision and ruled in favour of TNK-BP.
In practice the customs authorities try not to pay anything without a court’s decision. Moreover, this position is not only that of the customs, but of all government bodies in general. The absence of a statutory order is a favourite excuse of all public authorities when it comes to the payment of any sums of money, even if expressly stipulated by law.
From this perspective, the decision of the Ninth Court of Appeal for TNK-BP is not a precedent, but just a normal and proper use of law. Let us hope that this position of the Court of Appeal will continue to promote the correct understanding and application of the law in similar cases.
TNK-BP has succeeded in a serious of court wrangles and recovered an unprecedented amount of interest from the Federal Customs Service for the delayed return of overpaid customs duties. The Russian Customs Service will pay nearly 1 billion roubles ($32 million) interest.
The history of the legal argument between TNK-BP and the Federal Customs Service began a long time ago, in 2004 when a dispute started about rates applicable to exported crude oil and oil products.
The dispute was resolved by the courts in favour of TNK-BP and based on the court’s decision TNK-BP tried to collect 3.8 billion roubles ($120 million) from the Federal Customs Service which had been overpaid in 2004-2006.
When the Federal Customs Service refused to pay back the excess, TNK-BP appealed to the State Arbitrazh. In April 11, 2008 the Moscow State Arbitrazh ruled - the decision was later upheld by a higher court – that the customs was obliged to return overpaid payments within 10 days from the date when the decision came into force.
However, this money was only paid to TNK-BP’s account on November 19, 2009 - almost two years after TNK-BP had applied to the Federal Customs Service with the demand to return the overpaid duties. Assuming that the customs violated the term of repayment, TNK-BP claimed that the Federal Customs Service must also pay accrued interest of nearly 1 billion roubles.
The customs refused again - this time in the payment of interest – appealing to the lack of established procedure for the return of overpaid customs duties, and now the third series of trials between the Customs and TNK-BP began.
The Moscow State Arbitrazh supported the Federal Customs Service, stating in its decision of 23 June 2010 that the customs is authorized to conduct its business solely on the basis of law and in strict accordance with it, but in the law, despite the fact that it provides for the payment of interest, neither the procedure nor the terms for repayment are established. The Federal Customs Service on its own initiative and in the absence of a clearly specified procedure cannot make such payments.
Nevertheless, in September 2010 the Court of Appeal reversed the above decision and ruled in favour of TNK-BP.
In practice the customs authorities try not to pay anything without a court’s decision. Moreover, this position is not only that of the customs, but of all government bodies in general. The absence of a statutory order is a favourite excuse of all public authorities when it comes to the payment of any sums of money, even if expressly stipulated by law.
From this perspective, the decision of the Ninth Court of Appeal for TNK-BP is not a precedent, but just a normal and proper use of law. Let us hope that this position of the Court of Appeal will continue to promote the correct understanding and application of the law in similar cases.