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The Court Decision – Part 1 (1-124), Part 2

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Hoverspeed JudgementPart 1

125. The making of the 1992 order was preceded by the insertion of a new section 13(3A) into the General Reliefs Act (see para 82 above) by paragraph 8(2) of Schedule 1 to the Finance (No 2) Act 1992 in the following terms:

"An order under this section may provide, in relation to any relief which under such an order is made subject to a condition, for there to be a presumption that, in such cases as may be described in the order by reference (a) to the quantity of goods in question; or (b) to any other factor which the Commissioners consider appropriate, the condition is to be treated, unless the Commissioners are satisfied to the contrary, as not being complied with."

126. It is convenient at this stage to mention that section 4 of the Finance (No 2) Act 1992 made significant inroads into the powers available to Customs officers which might involve delaying a movement across an internal frontier of the Community. This section provides, so far as is relevant:

"4(1) Except in a case falling within subsection (2) below, the powers to which this section applies shall not be exercisable in relation to any person or thing entering or leaving the United Kingdom so as to prevent, restrict or delay the movement of that person or thing between different member States.

(2) The cases in which a power to which this section applies may be exercised as mentioned in subsection (1) above are those where it appears to the person on whom the power is conferred that there are reasonable grounds for believing that the movement in question is not in fact between different member States or that it is necessary to exercise the power for purposes connected with –

(a) securing the collection of any Community customs duty or giving effect to any Community legislation relating to any such duty; (b) the enforcement of any prohibition or restriction for the time being in force by virtue of any Community legislation with respect to the movement of goods into or out of the member States; or (c) the enforcement of any prohibition or restriction for the time being in force by virtue of any enactment with respect to the importation or exportation of goods into or out of the United Kingdom.

(3) Subject to subsection 4 below, this section applies to any power which is conferred on the Commissioners of Customs and Excise or any officer or constable under any of the following provisions of the customs and Excise Management Act 1979, that is to say: . . .

(g) section 78 (questions as to baggage of persons entering or leaving the United Kingdom); (h) section 164 (powers of search). . . .

(5) . . . %5BF%5D or the purposes of this section a power shall be taken to be exercised otherwise than in relation to a person or thing entering or leaving the United Kingdom in any case where the power is exercisable irrespective of whether the person or thing in question is entering or leaving the United Kingdom."

The restrictions on Customs officers' powers that are contained in this section flowed from the importation into our national law of the right of free movement within the internal market to which express reference was made in the first and tenth recitals to the Excise Directive (see paras 99 and 100 above).

127. In July 2000 a new section 163A of CEMA (inserted by section 26 of the Finance Act 2000) came into force, and this power, unlike the power under section 164, is available to Customs in respect of travellers passing an internal frontier (in the sense that section 4 of the Finance (No 2) Act was not extended to embrace it). It is in these terms:

"(1) Without prejudice to any other power conferred by the Customs and Excise Acts 1979, where there are reasonable grounds to suspect that a person in the United Kingdom (referred to in this section as 'the suspect') has with him, or at the place where he is, any goods to which this section applies, an officer may:

(a) require the suspect to permit a search of any article that he has with him or at that place, and (b) if the suspect is not under arrest, detain him (and any such article) for so long as may be necessary to carry out the search.

(2) The goods to which this section applies are dutiable alcoholic liquor, or tobacco products, which are:

(a) chargeable with any duty of excise, and (b) liable to forfeiture under the customs and excise Acts."

This provision complements a similar power to search vehicles which has been contained in section 163 of CEMA since its enactment.

128. We will now return to consider the PRO. Both in its original and in its amended form it seems to us to contain significant divergences from the requirements contained in the Excise Directive. Deficiencies in the original drafting were pointed out by the VAT and Duties Tribunal in the Hodgson case, and their analysis was accepted as being correct by the Criminal Division of the Court of Appeal in R v Travers (unreported, 9 July 1997, CACD). In Hodgson the Tribunal said (at %5B5%5D-%5B7%5D):

"5. Does Art 5(3) of the Personal Reliefs Order properly implement Art 9.2 of the Excise Directive? Article 9.2 must be read in the light of the background of the Excise Directive, found in the Recitals; the overall effect of the Excise Directive is to limit the charge to duty to the country of acquisition of the relevant goods; thereafter they may be moved to other member states without charge save where they are held for commercial purposes. Article 9.2 has the specific function of enabling the member state in question to establish whether the goods are intended for commercial purposes. It requires the member state to take account of the five listed criteria; and, for the purposes of applying the quantitative test (in the fifth indent), it enables the member state to set minimum guide levels 'solely as a form of evidence'. The result achieved is to allow member states to adopt levels not falling below the prescribed amounts; where in any particular instance the quantity of goods exceeds the prescribed level, the member state is entitled to adopt the presumption that the goods are held for a commercial purpose. But the status of the presumption is limited to being an evidential one. So understood the Excise Directive does not, in our view, entitle the national authority to enact implementing legislation, such as Art 5(3) of the Personal Reliefs Order as construed in Carrier (%5B1995%5D 4 All ER 38), that gives the decision of the Commissioners the status of an irrebuttable presumption.

6. %5BCounsel%5D for the Commissioners points out that the presumption in Art 5(3) of the Personal Reliefs Order, that more than one kilogram of tobacco has been imported for a commercial purpose, comes into operation only after a consideration of all the other relevant factors; if those other factors are sufficient to outweigh the fact of quantity, it will be accepted that no commercial purpose was intended. To that extent we agree. But Art 5(3) goes further. It purports to confine the evidential presumption to the administrative process by which the customs authority determines whether or not the tobacco is being held for a commercial purpose; and unless the authority has declared itself satisfied to the contrary. Once that determination has been made the person in question is treated as holding the tobacco for a commercial purpose, without any opportunity to establish the contrary. The guide level is not, in those circumstances, being used in the manner contemplated by Art 9.2 of the Excise Directive, i.e. 'solely as a form of evidence'; it is being used to enable an irrebuttable presumption to be raised on the basis of the authority's decision on the merits.

7. For those reasons we have concluded that Art 5.3 of the Personal Reliefs Order as construed in Carrier goes beyond the scope of Art 9.2 of the Excise Directive."

129. The problem the Tribunal identified goes back to the language of the original enabling power (for which see para 125 above) which departs a long way from the language of Article 9(2) of the directive, properly interpreted (for which see para 103 above). A further deficiency in the original order was that it suggested that it was permissible to charge excise duty on the importation of excise goods obtained by a Community traveller in the course of cross-border shopping, whereas the charge imposed by the directive on "false personal exports" falls when they are held in this country for a commercial purpose and not necessarily at the moment of importation. Hence, no doubt, the later amendment to Article 5(1).

18. Mortimer, Goldsmith and Lindsay

130. In R v Customs and Excise Commissioners ex p Mortimer %5B1999%5D 1 WLR 17 the Divisional Court (Lord Bingham CJ and Dyson J) was concerned with the interpretation of Article 5(3) of the PRO as a matter of English law before its later amendment. It was not invited to address questions relating to the interpretation of the Excise Directive. Lord Bingham made it clear that the Court was deciding the issues before it on the basis of ten propositions of English law which had been agreed between the parties, subject to one immaterial qualification. The extent of the differences we have to resolve can be usefully gauged by setting those agreed propositions (based solely on the PRO) (which we will identify with the letter "A") alongside what Mr. Thompson QC, for the claimants, says are correct propositions of law based on the Directive ("B"), and what he says is the effect of the PRO ("C"). We will set out our own comments under each proposition (letter "D"):

1. A Goods subject to excise duty may ordinarily be imported into one member state of the European Community from another. BGoods subject to excise duty may be imported into one member state of the European Community from another without restriction. Goods subject to excise duty may ordinarily be imported into the United Kingdom from another member state on payment of the relevant duty at the point of entry into the United Kingdom. D Proposition B is correct as a matter of EC law. Importation into one member state from another is not a chargeable event under the Excise Directive.

We accept that Proposition C sets out correctly the approach adopted by the United Kingdom legislators. The Alcohol Liquors Duties Act 1979 and the Tobacco Products Duty Act 1979 impose the duty mentioned in this proposition, and one then has to turn to the PRO to identify the terms of the "relief" granted in relation to imports from other member states.

2. A Excise duty is not payable if goods are imported for the personal use of the importer. B Excise duty is chargeable on such imports if (but only if) goods are held for a commercial purpose in the member state of import. C Excise duty is not payable only if goods are imported for the personal use of the importer. D Proposition B is correct as a matter of EC law.

Proposition C correctly reflects the "relief" afforded by Article 3 of the PRO.

3. A Excise duty is payable if goods are so imported for a commercial purpose. B Excise duty is to be charged on sale for goods acquired for personal use. C Excise duty is nonetheless payable unless it is further shown that the goods are not imported for a commercial purpose. D Proposition B correctly reflects EC law. Proposition C correctly reflects the way in which Articles 5(1) and (3C) of the PRO now place the burden of proof. A Court or tribunal has to be satisfied that the condition that the goods are not held or used for a commercial purpose has been complied with. This formulation places the persuasive burden of proof wrongly on the citizen, not the State.

4. A Where goods are imported into the United Kingdom from another member state it is in the first instance for the Customs and Excise to make a judgment whether the goods are imported for a commercial purpose or for personal use. BWhere goods are imported into the United Kingdom from another member state it is in the first instance for the Customs and Excise to make a judgment whether the goods are imported for a commercial purpose. C Where goods are imported into the United Kingdom from another member state it is in the first instance for the Customs and Excise to make a judgment whether the conditions for relief set out in 2C and 3C are satisfied. D Proposition B correctly reflects EC law. Proposition C correctly reflects the PRO.

5. A Where the quantity of excise goods in question is below prescribed levels, Customs and Excise may not presume that the goods are imported for a commercial purpose rather than for personal use. B Where the quantity of excise goods in question is below prescribed levels, Customs and Excise may not presume that the goods are imported for a commercial purpose but may still find that they are so imported. C Where the quantity of excise goods in question is below prescribed levels, Customs and Excise are to grant the relief if it accepts that both conditions set out at 2C and 3C above are satisfied. D Proposition B is correct as a matter of EC law. Proposition C correctly reflects the PRO.

6. A Where the quantity of excise goods in question is above the prescribed levels, Customs and Excise are to presume that the goods are imported for a commercial purpose rather than for personal use, but such presumption is rebutted if the importer, being required to do so, satisfies the Customs and Excise that the goods are imported for personal use rather than for a commercial purpose. B See below. C As A. D. Propositions A and C correctly reflect the PRO.

7. A In considering, where the quantity of excise goods imported exceeds the prescribed levels, whether the importer has satisfied them that the goods are not imported for a commercial purpose rather than for personal use, the Customs and Excise must have regard, inter alia, to matters listed in Article 5(2) of the PRO. BSee below. C As A. D Propositions A and C correctly reflect the PRO.

In series B, propositions 6 and 7 are inverted, and rewritten thus:

7. B In considering whether the goods are imported for a commercial purpose, the Customs and Excise must have regard, inter alia, to matters listed in Article 9(2) of the Excise Directive.

6. B Where the quantity of excise goods in question is above the prescribed levels, Customs and Excise must not presume that the goods are imported for a commercial purpose, but may take account of the fact that the prescribed levels have been exceeded "solely as a form of evidence".

7/6. D Proposition 7 correctly reflects EC law. So far as Proposition 6 is concerned, if the citizen affords no explanation at all about the purpose for which he holds the goods, then Customs and Excise are entitled to use the fact that the quantity is above the prescribed level as strong evidence that he holds them for a commercial purpose. We agree with the Tribunal in Hodgson at %5B5%5D (see para 128 above) that the possession of such a quantity raises an evidential presumption which calls for a response from the citizen, but once the citizen has responded, it is for Customs and Excise to be satisfied on all the evidence that the goods are held for a commercial purpose.

8. A If, in a case where the quantity of excise goods imported exceeds the prescribed levels, the Customs and Excise are not satisfied that the goods are imported for personal use rather than for a commercial purpose, they may seize the same as liable to forfeiture and on doing so must give written notice of such seizure to the importer unless he or his agent is present at the time of seizure. BIf the Customs and Excise find that the goods are imported for a commercial purpose, they may seize the same as liable to forfeiture, subject to the procedural and substantive requirement of Community law and of the Human Rights Act 1998. C As A. D Propositions A and C correctly reflect the PRO. We accept Proposition B as correctly reflecting in an English context what is permissible under the Excise Directive.

9. A If, in such a case, an importer gives timely notice in writing claiming that the goods are not liable to forfeiture, the Customs and Excise must take proceedings for the condemnation of the goods by the Court. B The decision of Customs and Excise must be subject to independent judicial scrutiny. C As A. D Propositions A and C correctly reflect the PRO. We accept Proposition B as a correct reflection of EC law.

10. A In such Court proceedings, it is for the Court to decide de novo whether the goods were imported for a commercial purpose, the proceedings being civil and the burden lying on the Customs and Excise to prove on a balance of probabilities that the goods were imported for a commercial purpose. BIn such appeal proceedings, it is for the appeal tribunal to decide de novo whether the goods were imported for a commercial purpose, the proceedings being civil and the burden lying on the Customs and Excise to prove on a balance of probabilities, and on the basis set out above, that the goods were imported for a commercial purpose. C In such Court proceedings it is for the Court to decide de novo whether the conditions set out at 2C and 3C are satisfied, the proceedings being civil and the burden lying on the individual to prove on a balance of probabilities that the above conditions are satisfied, failing which no entitlement to relief arises. D Proposition A does not correctly set out the position under the PRO. The burden of proof under the PRO clearly lies on the citizen: see our comments in 3D above. Indeed, during the course of the hearing before us Mr. Anderson's instructions were changed, following questions by the Court. He originally set out to argue that the position was as stated at A, and that this was a correct reflection of the language of the PRO. He then told us, on instructions, that in practice a magistrates' Court is invited to start with a presumption that goods over the limit were held for a commercial purpose, and the citizen then has to rebut that presumption and prove that they were not, if his goods are not to be condemned.

Proposition C correctly reflects the position under the PRO. Proposition B (where the burden of proof is reversed) correctly reflects the position under the Directive, which should be followed both in condemnation proceedings and before the VAT and Duties Tribunal (for which see para 136 below).

131. There are two later English decisions on the effect of the PRO which we need to notice. In Goldsmith v Commissioners for Customs and Excise %5B2001%5D 1 WLR 1673 the proceedings before a Divisional Court consisting of Lord Woolf CJ and Poole J were based on the unchallenged proposition that the burden of proving in condemnation proceedings that the goods were not for a commercial purpose lay on the applicants pursuant to Article 5(3) of the PRO. Although this proposition is the exact obverse of the tenth proposition accepted by the Court in Mortimer, we are satisfied that it represents a correct interpretation of what Article 5(3) requires.

132. As in Mortimer, the Court was not concerned with any arguments based on the Excise Directive. Instead, the applicants' advisers based their challenge on an argument that the reversal of the onus of proof conflicted with the presumption of innocence in ECHR Article 6(2). Lord Woolf CJ rejected this challenge. Although he accepted that the seizure and forfeiture of goods contained an innuendo that the applicants had evaded the duty which they should have paid, he said (at %5B21%5D):

"The issue of fact which is at the centre of condemnation proceedings is whether or not the goods are to be used for private or commercial purposes. No one is in a better position to know whether they are to be used for private or commercial purposes than someone in Mr. Goldsmith's position. Accordingly, if his evidence is not accepted by the justices or the Crown Court, there is a reflection upon his character. The reflection arises out of the fact that he has not satisfied the justices or the Crown Court on the balance of probabilities as to the truth of his account as to why the goods were brought into this country. However, in my judgment, that does not mean that the proceedings are criminal. Nor does it mean, in my judgment, that there is anything wrong with the form of the legislation which resulted in the condemnation proceedings. The form of the Order enables members of the public, under Article 5, to bring in quantities of goods specified in the Schedule without being under any risk of being proceeded against by Customs and Excise in reliance on Article 5(3) of the Order. If members of the public choose to bring in greater quantities than that, then the onus is placed upon them to satisfy the Customs and Excise Commissioners that the goods are required for private, and not commercial, purposes. The Order indicates the quantities of goods which the Commissioners have concluded can reasonably be regarded in general as being the sort of quantities that an individual would import for private purposes. If quantities in excess of those are brought into the country, they are not necessarily for commercial purposes. However, in such circumstances there is a presumption that the goods are being brought in for commercial purposes and the onus is placed upon someone in Mr. Goldsmith's position to rebut that presumption. The presumption is rebutted by giving evidence which, on the balance of probabilities, satisfies the courts that they are required for private purposes."

133. He went on to hold at %5B24%5D that condemnation and forfeiture proceedings should not be characterised as criminal proceedings for ECHR purposes, and that even if they were, the reverse onus of proof could be justified on the simple basis that to place a burden on a member of the public importing more than the specified amount of goods to establish that they were required for non-commercial purposes was proportionate, reasonable and justifiable.

134. This was a case which turned solely on the proper interpretation of the PRO (and its compatibility with the ECHR). So, too, was the decision of the Court of Appeal in Lindsay v Customs and Excise Commissioners %5B2002%5D 1 WLR 1766. This case arose, however, not out of condemnation proceedings in the magistrates' courts but out of proceedings in a VAT and Duties Tribunal, and we must first describe the effect of the legislation which established the jurisdiction of such a tribunal in these matters, and the nature of that jurisdiction.

135. One of the purposes of this legislation is described by Potter LJ in his judgment in Han v Customs and Excise Commissioners %5B2001%5D EWCA Civ 1040 at %5B37%5D-%5B54%5D, %5B2001%5D 1 WLR 2253. A statutory scheme was introduced in 1994 whereby instead of an excise regime which provided solely for criminal offences (so that no civil penalties were provided for fraud or for negligent acts or omissions of a lesser kind) a system of civil penalties was introduced with a right of appeal to a VAT and Duties Tribunal. The opportunity was taken at the same time to equip these new specialist tribunals with supervisory powers in areas where for want of a statutory appeal process the citizen's only previous remedy was by way of judicial review (as in the AGOSI and Air Canada cases, for which see paras 93 and 94 above).

136. The new tribunals were created by Chapter II of the Finance Act 1994. Section 8 of that Act, with which we are not concerned in the present case, introduced the new civil penalties for evasion of excise duty. Section 14 created a new procedure whereby an aggrieved person might require the Commissioners to review a decision of a type described in section 14(1). Section 15 prescribed the review procedure, and section 16 created a right of appeal to a VAT and Duties Tribunal from a decision of the Commissioners on a review. All that need be said in the present context is that a decision by the Commissioners under section 152(b) of CEMA as to whether or not anything forfeited or seized is to be restored, or as to the conditions subject to which any such thing is so restored (see para 92 above) is one of the decisions of which a review may now be required (see Finance Act 1994, Schedule 5, paragraph 2(1)(r)). The powers of a tribunal on an appeal against a decision of the Commissioners on a review are set out in section 16(4) of the 1994 Act in these terms:

"(4) In relation to any decision as to an ancillary matter, or any decision on the review of such a decision, the powers of an appeal tribunal on an appeal under this section shall be confined to a power, where the tribunal are satisfied that the Commissioners or other person making that decision could not reasonably have arrived at it, to do one or more of the following, that is to say:

(a) to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the tribunal may direct; (b) to require the Commissioners to conduct, in accordance with the directions of the tribunal, a further review of the original decision; and (c) in the case of a decision which has already been acted on or taken effect and cannot be remedied by a further review, to declare the decision to have been unreasonable and to give directions to the Commissioners as to the steps to be taken for securing that repetitions of the unreasonableness do not occur when comparable circumstances arise in the future."

We were told that virtually all the appeals to VAT and Duties Tribunals that relate to Customs seizures in respect of alcohol and tobacco are now concerned with complaints about seized vehicles, and not about seized goods.

137. In Lindsay, as in Mortimer and Goldsmith, the Court was concerned only with the interpretation of the effect of the PRO and it did not receive any submissions about the effect of the Excise Directive. Mr. Lindsay was aggrieved because customs officers had not only seized his cigarettes and tobacco but also his valuable new car. His purchases had been substantially in excess of the MILs, and the tribunal accepted his evidence that he had been paid £900 by other members of his family to buy cigarettes for them, too. Lord Phillips Mr. expressed some surprise at %5B28%5D and %5B45%5D about some of the tribunal's findings of fact, but he accepted them loyally for the purposes of the point of law the Court of Appeal had to decide.

138. The approach of Customs and Excise officers to the location of the burden of proof under the PRO is reflected by the extract from the decision of the Review Officer quoted by Lord Phillips at %5B34%5D in these terms:

"Later, when explaining why there was no entitlement to duty relief, she said:

'Relief from the payment of any excise duty afforded under the 1992 Order is only if the goods are for own use and that the individual has transported them. This is not the case here. You had entered into a commercial transaction with your family to purchase excise goods on their behalf. They are deemed not to be for 'own use' under the legal definition quoted earlier, therefore there is no relief from the payment of excise duty on these goods and this rendered them liable to forfeiture.'"

139. Mr. Lindsay's complaint to the tribunal was that the cigarettes and tobacco that had been seized had cost £2,107, which reflected the amount of the duty which would have been paid on them if he had bought them in this country. He said that it was oppressive and disproportionate to seize his car as well. The tribunal accepted these submissions and directed that the seized vehicle should be restored to Mr. Lindsay, or that he should be paid compensation in lieu (see Lord Phillips Mr. at %5B68%5D-%5B70%5D for his observations on the form of this order which went outside the tribunal's jurisdiction). The Commissioners appealed to the Court of Appeal.

140. On the appeal, the Court was concerned with two quite different issues. The first arose out of the tribunal's finding that the Commissioners' general policy relating to the seizure of vehicles was unlawful. The second arose out of Mr. Lindsay's contention that whatever might be the legal position with regard to the vehicles of genuine commercial smugglers, it was disproportionate to apply the same policy in relation to the seizure of his car because his situation was quite different from that of the commercial smuggler. The Court of Appeal upheld the Commissioners' arguments on the first of these issues but rejected them on the second.

141. So far as the first issue was concerned, Lord Phillips said (at %5B60%5D) that it was appropriate to bear in mind the scale of the evil against which the policy was directed. We have described this evil in paragraphs 7-8 above. He also considered it relevant to bear in mind that the free movement of persons within the internal market greatly facilitated the illicit importation of excise goods into this country. When reckoning up the risk, the potential smuggler would have regard not merely to the consequences of apprehension but to the likelihood that this would occur. He then referred to the fact that notice was given to travellers that they were only entitled to bring back excise goods duty free if they were for their own use and that smuggling could lead to the forfeiture of their vehicles. In those circumstances anyone who used his car for smuggling was likely to be taking a calculated risk. He concluded his judgment on this part of the case in these terms (at %5B63%5D):

"Having regard to these considerations, I would not have been prepared to condemn the commissioners' policy had it been one that was applied to those who were using their cars for commercial smuggling, giving that phrase the meaning that it naturally bears of smuggling goods in order to sell them at a profit. Those who deliberately use their cars to further fraudulent commercial ventures in the knowledge that if they are caught their cars will be rendered liable to forfeiture cannot reasonably be heard to complain if they lose those vehicles. Nor does it seem to me that, in such circumstances, the value of the car used need be taken into consideration. Those circumstances will normally take the case beyond the threshold where that factor can carry significant weight in the balance. Cases of exceptional hardship must always, of course, be given due consideration."

142. He went on to say, however, at %5B64%5D-65%5D:

"The commissioners' policy does not, however, draw a distinction between the commercial smuggler and the driver importing goods for social distribution to family or friends in circumstances where there is no attempt to make a profit. Of course even in such a case the scale of importation, or other circumstances, may be such as to justify forfeiture of the car. But where the importation is not for the purpose of making a profit, I consider that the principle of proportionality requires that each case should be considered on its particular facts, which will include the scale of importation, whether it is a 'first offence', whether there was an attempt at concealment or dissimulation, the value of the vehicle and the degree of hardship that will be caused by forfeiture. There is open to the commissioners a wide range of lesser sanctions that will enable them to impose a sanction that is proportionate where forfeiture of the vehicle is not justified.

I do not think that it would be impractical to distinguish between the truly commercial smuggler and others. The current regulations shift the burden to the driver of showing that he does not hold the goods 'for commercial purposes' when these exceed the quantity in the Schedule. In a case such as the present the driver importing for family or friends should be in a position to demonstrate thatis the case if called upon to do so: see the comments of Lord Woolf CJ in Goldsmith v Customs and Excise Comrs %5B2001%5D 1 WLR 1673, 1679-1680."

143. In these circumstances he upheld the tribunal's decision on the grounds that the review officer had applied the Commissioners' "almost automatic seizure" policy and had failed to have regard to material considerations when concerned with a driver importing goods for family and friends, as opposed to "the true commercial smuggler". Lord Justice Judge, concurring, said at %5B73%5D that the question whether the power to seize the vehicle of a non-profit-making smuggler should be exercised was fact-dependent. It required a realistic assessment of all the circumstances of the individual case, including the alternative sanctions available to the Commissioners, rather than the virtually automatic imposition of a burdensome and, at times, oppressive prescribed penalty.

144. We have already described (at para 20 above) the way in which the Commissioners altered their policy on restoration of vehicles to "non-commercial smugglers" following the Lindsay judgment. It must be borne in mind, however, that the Court of Appeal did not receive detailed argument about the effect of the Excise Directive and that its conclusions were founded on the scheme sanctioned by the PRO, as correctly interpreted by the Divisional Court in Goldsmith.

19. Some ECHR arguments

145. After describing these three recent judgments on the effect of the PRO we turn now to the submissions we received from Mr. Rabinder Singh QC, who also appeared for the claimants. They were based on ECHR considerations, either for the purpose of illuminating relevant propositions of EC law (see para 112 above for the connection) or in their own right as pursuant to the Human Rights Act 1998.

146. We can dispose of Mr. Singh's two main submissions quite briefly. He argued that seizure involved the deprivation of an owner of his goods (or vehicle), and that the act of seizure should itself be accompanied by appropriate procedural safeguards, given the owner's Convention rights under Article 1 of the First Protocol to the Convention. He also submitted that the Commissioners' procedures amounted to the making of criminal charges against the four individual claimants within the meaning of ECHR Article 6(1). He relied in particular in this context on the majority judgments of the Court of Appeal in Han v Customs and Excise Commissioners %5B2001%5D 1 WLR 2253. He also sought to derive assistance from the majority judgments of that Court in International Transport Roth Gmbh v Secretary of State for the Home Department %5B2002%5D EWCA Civ 158 (particularly Simon Brown LJ at %5B41%5D).

147. Whatever may be the position with different legislative schemes, this particular scheme has attracted the attention of the European Court of Human Rights on two separate occasions, in the AGOSI case and in the Air Canada case (see paras 93 and 94 above). Although we note Simon Brown LJ's observations in Roth at %5B41%5D to the effect that the dissenting judgments in Air Canada were perhaps the more powerfully reasoned, and that Strasbourg jurisprudence has moved on since then, we also note his apparent acceptance (at %5B40%5D) of Lord Woolf's conclusions in Goldsmith that condemnation and forfeiture proceedings were civil on the basis that:

" . . . none of the usual consequences of a criminal conviction follow from condemnation and forfeiture proceedings. There is no conviction or finding of guilt. Under domestic law the person concerned is not treated as having a conviction. The person concerned is not subject to any other penalty, apart from the consequences of the forfeiture and loss of the goods."

148. In Han the Court of Appeal was concerned with a quite different situation. There the Court was concerned with civil penalties exacted for dishonest conduct treated as civil fraud, a factor which weighed heavily with the majority (see Potter LJ at %5B76%5D and Mance LJ at %5B87%5D). The facts of the Roth case, too, were not precisely comparable with the present, although there are some similarities.

149. It appears to us that in these circumstances at this level of the judicial hierarchy we should follow both Strasbourg case law (see Human Rights Act 1998 s 2(1)(a) for our duty to take it into account) and the very recent judgment of this Court in Goldsmith. Indeed, we would have to find that the decision in Goldsmith was clearly wrong if we were to decline to be bound by it (R v Greater Manchester Coroner ex p Tal %5B1985%5D 1 QB 67) and we did not understand Mr. Singh to be encouraging us to go as far as that, so long as we rejected his submission, as we do, that Han puts the matter once again at large.

150. Under the condemnation procedures prescribed by the third schedule to CEMA (see para 91 above) the question whether the goods or the vehicle should actually be forfeited is clearly to be determined by a Court with full jurisdiction for Article 6 purposes. If the owner prefers to travel down the route of seeking restoration and then challenging a review officer's adverse decision by appealing to a VAT and Duties Tribunal, Mr. Singh did not seek to challenge the correctness of the decision of that tribunal, again given by His Honour Stephen Oliver QC, in Gora v Commissioners for Customs and Excise (21st January 2002), which held that its jurisdiction under section 16(4) of the Finance Act 1994 was sufficiently wide to satisfy the requirements of ECHR Article 6.

151. We should add, for the sake of completeness, that we reject Mr. Singh's submission that the act of seizure in itself constitutes a determination of the owner's civil rights within the meaning of ECHR Article 6(1). That act merely brings under the Commissioners' control goods or vehicles which they consider liable to be forfeited (see Air Canada at %5B32%5D-%5B33%5D). Whether they are indeed forfeited, or deemed to be forfeited, depends on whether a challenge is made, and if so, whether a Court upholds the Commissioners' claim to be entitled to deprive the owner of his property.

152. Mr. Singh appeared to be on much stronger ground when he argued that the Commissioners' seizure policy must be prescribed by law if it is to satisfy ECHR requirements, particularly in the context of Article 1 of the First Protocol to the Convention which provides that:

"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties." (Emphasis added).

153. In Sunday Times v United Kingdom (1979-80) 2 EHRR 245 the European Court of Human Rights explained two of the requirements that flow from the presence of the expression "prescribed by law" in ECHR Article 10(2). It said at %5B49%5D:

"(i) The law must be adequately accessible: the citizen must be able to have an indication that is adequate in the circumstances of the legal rules applicable to a given case; (ii) A norm cannot be regarded as a 'law' unless it is formulated with sufficient precision to enable the citizen to regulate his conduct: he must be able – if need be with appropriate advice – to foresee, to a degree that is reasonable in the circumstances, the consequences which a given action may entail."

154. The Court went on to explain that those consequences need not be foreseeable with absolute certainty. It also observed that certainty may bring in its train excessive rigidity and that the law must be able to keep pace with changing circumstances. But it did not thereby water down very much the central requirements of accessibility and foreseeability.

155. In Hentrich v France (1994) 18 EHRR 40 the Strasbourg Court applied these principles in a case where the applicant complained of a breach of Article 1 of the First Protocol. Mrs. Hentrich had bought some land, and the Commission of Revenue exercised a statutory right of pre-emption because it considered that the sale price was too low. It appeared (see the Court's judgment at %5B39%5D) that the right of pre-emption was not designed to punish tax evasion. Its purpose was to prevent non-payment of higher registration fees. The purchaser's good or bad faith was therefore immaterial.

156. The French Government accepted that the concept of a price being too low was imprecise, but it said that it was to be assessed with reference to transfers of the same type in similar circumstances, and that the assessment could be challenged by the dispossessed owner. A significant part of the Strasbourg Court's concern related to the fact that the pre-emption procedure was not attended by the basic procedural safeguards. This does not, however, detract from the main thrust of the judgment at %5B42%5D:

"42. . . . %5BT%5Dhe Court considers it necessary to rule on the lawfulness of the interference.

While the system of the right of pre-emption does not lend itself to criticism as an attribute of the State's sovereignty, the same is not true where the exercise of it is discretionary and at the same time the procedure is not fair.

In the instant case the pre-emption operated arbitrarily and selectively and was scarcely foreseeable, and it was not attended by the basic procedural safeguards. In particular, Article 668 of the General Tax Code, as interpreted up to that time by the Court of Cassation and as applied to the applicant, did not sufficiently satisfy the requirements of precision and foreseeability implied by the concept of law within the meaning of the Convention." (Emphasis added)

157. In the Air Canada case, where the Court at Strasbourg split 5-4, the majority of the Court contented itself with observing (at %5B40%5D) that both the seizure of the aircraft and the requirement of payment, in the absence of any finding of fault or negligence on the part of the applicant, were in conformity with the relevant provisions of CEMA. They were clearly influenced by the fact that the Commissioners did not exercise their strikingly wide powers of forfeiture until after a long series of alleged security lapses in relation to drugs importation had been drawn to Air Canada's attention, culminating with an express written warning to them that when they carried prohibited goods, the Commissioners would consider exercising their powers under CEMA, including the seizure and forfeiture of aircraft.

158. In those circumstances the relevant law (though strikingly wide) was accessible and the Commissioners' exercise of their powers, following an express warning, was predictable. This did not prevent four members of the Court from entering the powerful dissenting opinions noted by Simon Brown LJ in Roth at %5B41%5D. The main concerns expressed by Judge Walsh, and by Judge Martens (joined by Judge Russo), were that a law which made no distinction at all between the innocent and the guilty could not be upheld as being in the general interest within the meaning of the second paragraph of Article 1 of the First Protocol: see Judge Walsh at %5B2%5D-%5B4%5D, and Judge Martens at %5B5%5D. Judge Pekkanen, for his part, said at %5B1%5D that CEMA:

" . . . gives practically unfettered discretion to the Commissioners with regard to both the seizure and the measures to be taken following it. Is this type of legal provision sufficiently precise to satisfy the criterion of 'foreseeability' required by the Convention according to the Court's case law? In the case of Anderson v Sweden (1992) 14 EHRR 615 this requirement, in so far as it concerns the exercise of discretion, was described as follows: 'A law which confers a discretion is not in itself inconsistent with this requirement, provided that the scope of the discretion and the manner of its exercise are indicated with sufficient clarity, having regard to the legitimate aim in question, to give the individual adequate protection against arbitrary interference'. In my opinion the law in question does not fulfil this criterion of foreseeability."

20. Reasonable grounds for suspicion

159. In O'Hara v Chief Constable of the Royal Ulster Constabulary %5B1997%5D AC 286 the House of Lords was concerned with the nature of the information that had to be available to a constable before he exercised a power of arrest under section 12(1) of the Prevention of Terrorism (Temporary Provisions) Act 1984. Lord Steyn made it clear at p 293 that a constable might act on hearsay information, such as information from an informer or a tip-off from a member of the public, and that he need not have evidence amounting to a prima facie case in order to have a reasonable suspicion. Lord Hope, for his part, recognised that for obvious practical reasons police officers had to be able to rely upon each other in taking decisions as to whom to arrest or where to search and in what circumstances. He added (at p 302):

"The statutory power does not require that the constable who exercises the power must be in possession of all the information which has led to a decision, perhaps taken by others, that the time has come for it to be exercised. What it does require is that the constable who exercises the power must first have equipped himself with sufficient information so that he has reasonable cause to suspect before the power is exercised."

160. It should be noted that because sections 163, 163A and 164 of CEMA merely require the existence of reasonable grounds for suspicion, the present statutory scheme is rather different because the individual Customs officer may simply follow orders given to him by another, and need not himself suspect anything (see Lord Steyn for this distinction at p292A-H). But the reasonable suspicion on which he is acting must be that the particular individual whom he is searching is in possession of chargeable goods, and not merely that he falls into a typical "profile" of people who have found to be in possession of such goods in the past. The PACE Code of Practice for the Exercise by Police Officers of Statutory Powers of Stop and Search provides good examples of the kind of matters Customs officers are entitled to take into account. That code makes it clear that (with one immaterial exception) reasonable suspicion can never be supported on the basis of personal factors alone, without supporting intelligence or information.

161. This is a good example of a provision of our national law which is similar to the principle of EC law that checks may lawfully be made, or questions asked, on an individualised basis where there is sufficient justification in the particular case. Systematic checking, on the other hand, or questioning in the absence of justification in each individual case under EC law is not permissible (see paras 96-98 above).

21. Hoverspeed's six claims: our conclusions

162. In the light of the principles set out in our judgment we will now consider the terms of the eight declarations the claimants invited us to make.

163. They first invited us to declare that excise duty was chargeable on excise goods imported from another Member State (on which duty has been paid elsewhere in the Community) if and only if those goods are imported into the United Kingdom for commercial purposes.

164. This follows necessarily from our analysis of the effects of Articles 6 to 10 of the Excise Directive (see paras 101-115 above). Chargeability arises when goods are held in this country for commercial purposes.

165. Next, they invited us to declare that the PRO was incompatible with the Excise Directive and with Article 28 of the EC Treaty in so far as it fails to exclude chargeability on excise goods imported from another Member State (on which excise duty has been paid elsewhere in the Community) otherwise than where the Commissioners establish that the goods are imported into this country for commercial purposes.

166. Mr. Anderson QC, who appeared for the Commissioners, argued that the PRO was indeed compatible with this country's obligations under EC law. He reminded us of the freedom given to member states by Article 249 of the Treaty to choose the way in which they are to implement the requirements of a directive, subject only to the requirement identified by the European Court of Justice in van Schijndel %5B1995%5D ECR I-4705 at %5B17%5D to the effect that any national implementing rules must not be less favourable than those governing similar domestic actions, nor render virtually impossible or excessively difficult the exercise of rights conferred by Community law.

167. Mr. Anderson suggested that it was only in the case of a directive which specifically addressed the burden of proof (such as Council Directive 97/80/EEC, which is concerned with the burden of proof in sex discrimination cases) that there would be a legal obligation on a member state to provide that the burden of proof should be allocated in a particular way.

168. There is, however, another principle of EC law that we need to bear in mind. In Commission v Italy %5B1988%5D ECR 3249 the European Court of Justice said at %5B12%5D that as a matter of general law, national implementing rules must:

"give the persons concerned a clear and precise understanding of their rights and obligations and enable national courts to ensure that those rights and obligations are observed."

169. In the present context E.U. nationals have a right to carry with them duty free into this country excise goods such as alcohol and tobacco which they have bought in another member state for their own use. One would expect to see that our national law recognised that right in the PRO and that it correctly imported into the PRO the principle that such goods are only not to be treated as being imported for the travellers' own use if the state can show that they are in fact holding them for a commercial purpose.

170. Nobody reading Article 5 of the PRO could, in our judgment, have a clear and precise understanding that these are their rights. The PRO does not, as the directive requires, abolish the imposition of excise duty on imports at the internal frontier (save for cases concerned by Articles 7, 9 and 10 in so far as such duty is chargeable on goods held for a commercial purpose within the state), and it imposes on the citizen the burden of establishing that he is not holding the goods for a commercial purpose, a burden expressly not imposed by the directive.

171. In those circumstances we consider that the claimants' second proposition is correct.

172. Thirdly, we were invited to declare that the presumption contained in Article 5(3B) of the PRO in respect of goods held in excess of MILs does not treat such excess "solely as a form of evidence" and is Thursday incompatible with Article 9(2) of the Excise Directive and Article 28 of the EC Treaty (see paras 103 and 73 above).

173. We have set out the terms of Article 5(3B) in paragraph 122 above. As a matter of strict law we consider that the claimants' contentions are correct. Whether this will make much difference as a matter of practice is open to question. After all, as Lord Woolf pointed out in Goldsmith (see para 132 above), no one is in a better position to know whether the goods are to be used for private or commercial purposes than the person in possession of them, and if Customs officers do not believe him, there is in practical terms not much difference between his failing to satisfy them that they are not being held for his own use (the PRO test) and them being satisfied that they are being held for "commercial" use (the test under the directive). In a borderline case, however, the location of the burden of proof may well make a difference.

174. Fourthly, we are asked to declare that checks can be carried out on individuals and their goods only where such checks are specifically authorised by Community law, or where there are individualised grounds for believing that the individual is acting unlawfully.

175. As we have explained, the free movement of persons and goods within the internal market is one of the distinguishing features of the Community. The first and tenth recital to the Excise Directive (see paras 99 and 100 above) confirm that it was the purpose of the Council to extend the right of free movement to excise goods, and to prohibit frontier checks that were liable to impede this right. This was the reason why express provision had to be made in Article 26(4) of the directive to enable the three Scandinavian states to carry out frontier checks for the purpose of collecting excise duty during the transitional period allowed to them (see para 119 above).

176. Mr. Anderson argued that the recent decision of the European Court of Justice in Wijsenbeek %5B1999%5D ECR I-6207 (see the judgment at %5B40%5D in particular) entitled the Commissioners to carry out checks of the kind in question close to the border of this country until such time as national rules on excise duties were harmonised throughout the community.

177. The difficulty with this submission is that the provisions of sections 78 and 164 of CEMA (for which see paras 83-85 above) which impose a positive duty on persons entering this country to declare dutiable goods to Customs officers and give Customs officers their familiar powers to ask questions, to direct travellers to produce their baggage for examination, and to search them if the conditions in section 164(1) are fulfilled, are all inapplicable in the case of people crossing an internal frontier of the Community if the exercise of these powers is likely to delay their movement, except for the purposes set out in section 4(2) of the Finance Act 1992 (see para 126 above). None of these exceptions relate to the purpose of securing the collection of excise duty chargeable under national, as opposed to Community, legislation. In other words, Customs officers do not have any relevant powers of intervention under our national legislation other than those conferred by sections 163 and 163A of CEMA, which depend on the existence of reasonable grounds for suspicion on an individualised basis.

178. We accept that even where border controls no longer exist, national checks are permissible as a matter of Community law. In 1992 the Commission's communication on the abolition of border controls contained this passage of helpful advice:

" . . . %5BT%5Dhe abolition of border controls does not deprive the competent authority's of the power to act throughout their territory and up to the frontier of that territory. However as the crossing of the frontier may no longer give rise to controls, such intervention must form part of internal monitoring arrangements covering the whole of the territory."

179. Mr. Anderson, however, was unable to identify any source of power entitling his clients to delay people's movement at a frontier on the rather general grounds of "testing smuggling risk" or because they have travelled a route which "matches a known smuggling profile" (see para 193 below), where there were no reasonable grounds for suspecting them on an individualised basis.

180. It follows that the only power available to Customs and Excise officers to stop and search people (or their vehicles) at an internal frontier arises if there are reasonable grounds to suspect one or other of the matters set out in sections 163 and 163A of CEMA. They are not entitled to rely on generalities or trends: there must be reasonable grounds to suspect the person (s) whom they are checking. In the absence of such suspicion on an individualised basis, they have no right to impede Community travellers' movement at the frontier for purposes connected with the collection of excise duty. The powers they use at a frontier must be the same powers as they would use anywhere else within the state for the purpose of ensuring that duty is paid on excise goods chargeable within that territory.

181. The fifth declaration we were invited to make is that the Commissioners' current checking policy on individuals and their goods was contrary to Community law, and in particular to Articles 28 and 29 of the EC Treaty, Council Directives 73/148 and 64/221 and Council Regulation 3925/91 (for these provisions, see paras 73, 75, 76 and 118 above).

182. These provisions are all concerned with the Community rights of free movement afforded to nationals of member states and goods passing within the internal market, and to different features of the frontier checks which may still constitute an impediment to free movement.

183. We do not consider that it is necessary to add anything to what we have said in paragraphs 175-180 above. Prima facie individuals and their goods must be free to travel across internal frontiers without being impeded and delayed by checks for excise duty purposes, although such checks may be made on an individualised basis for the purposes set out in sections 163 and 163A of CEMA.

184. Sixthly, we were asked to declare that the Commissioners' policy in respect of the seizure of goods found to be chargeable to United Kingdom excise duty, and of vehicles containing such goods, as evidenced by (a) the "Guidance to efficient and effective handling of excise suspects to be adopted by all multifunctional anti-smuggling teams" dated June 2000, (b) the circular letter to its officers dated 13 July 2000, and (c) the "Guidance on application of section 141 to support seizure action" dated 3 December 2001, was incompatible with Community law and with the rights conferred on individuals by Article 6 of, and Article 1 of Protocol 1 to, the European Convention on Human Rights. We described the first of these Guidance documents in paragraph 15 above; the circular letter at paragraph 16 above; and the later Guidance document in paragraph 17 above.

185. Mr. Anderson invited us to take a number of different matters into account when assessing the proportionality of the Commissioners' current policies (for which see paras 16-20 above). First, there was what he called the paramount importance of the objectives pursued (see paras 4-8 above), and the obvious need for firm action to achieve those objectives. Then there was the fact that the scheme was designed to deter rather than to punish: there were advantages to be gained from simplicity in communicating a deterrent message. Next came the strong likelihood that by its deterrent effect the policy made a major contribution to its objectives: we were invited in this context to consider the statistics we have set out in paragraphs 7 and 10 above. Then he pointed out the flexibility built into the policy itself, allowing for exceptions where it would be inhuman or disproportionate to refuse to restore (see item 12 at para 16 above). Fifthly, CEMA gave the Commissioners a wide discretion in implementing policies forming part of the political programme of a democratic government. And finally, so far as seizure was concerned, there was the practical necessity of allowing decisive action at the port.

186. In considering Hoverspeed's sixth point, we do not think it would be particularly useful for us to consider the detailed contents of the three guidance documents. We have set out the relevant principles of law in this judgment and it will be for magistrates' courts (or the High Court) in condemnation proceedings or the VAT and Duties Tribunal in appeals brought under section 16 of the Finance Act 1994 to apply these principles to the facts of individual cases.

187. We would, however, draw the same distinction as that which was drawn in the Lindsay case between the treatment of those who are found to be smuggling for profit and those who are directly or indirectly involved in not-for-profit smuggling. So far as the latter are concerned, the remedy applied by the Commissioners must be proportionate to the activity of which complaint is made. We are not satisfied that the vague exception contained in item 12 of the Commissioners' July 2000 guidance does much more than pay lip service to the important EC and ECHR principle of proportionality, because it gives Customs officers no proper guidance about how to apply this exception in a way of which the courts at Strasbourg and Luxembourg would approve.

188. The hostility shown in Strasbourg jurisprudence to the exercise of wide discretions by executive bodies must be taken into account in the individual decision-making process in these cases. If an executive body with powers as extensive as those accorded to the Commissioners by section 141(1) of CEMA makes it clear to the person against whom it may exercise those powers of the likely consequences if he acts or omits to act in a particular way, and if it then exercises its power in a proportionate manner, then the Air Canada case shows that it may well be found to be acting lawfully. On the other hand, Article 1 of the First Protocol to the Convention does not permit a public authority to act in a disproportionate way when forfeiting a person's property, however keen it is on a harsh deterrent policy for the greater public good.

189. Provided that the Commissioners confine their checks to those individuals about whom there are reasonable grounds for suspicion, such grounds being relevant to those individuals, we see nothing unlawful about their policy of seizing goods or vehicles until such time as an independent Court or tribunal can adjudicate on the matter. It is their present policy on restoration which concerns us. They do not purport to treat all absentee owners equally, and they do not purport to give a proportionate response in every case (see Commission v Italy %5B1963%5D ECR 165 at %5B177-8%5D and Kraus %5B1993%5D ECR I-1663 for relevant principles of EC law). If goods worth £1,000 are seized, the genuine smuggler's car worth £2,000 will also be seized, and both will be forfeited. If goods worth £500 are seized from a "not for profit" smuggler, the absentee owner's car worth £15,000 will also be seized, and both will be forfeited. And the policy discriminates in favour of the absentee owner who is a hiring company and against the absentee owner who is a private individual, although both could have imposed conditions on the terms on which they were willing to hire or lend their goods. It is easier to consider how these principles should be applied in particular cases, however, than to state them in a vacuum.

190. So far as Hoverspeed is concerned, it follows that we broadly accept the correctness of the propositions they set out in their draft declarations. Although the general picture is reasonably clear, there is so much dispute about matters of detail that we do not at present consider it appropriate to make any particular declarations on the facts. We have stated the relevant law in this judgment, and we do not at present think any formal declarations are necessary or desirable, although we are willing to hear counsel on this topic when we have handed down this judgment.

22. The four individual claims: our conclusions

191. We can deal with the position of the four individual claimants quite briefly. Although the Commissioners argued that they should be left to seek redress in a different forum, Richards J rejected these submissions at a hearing on 27th February 2002, so that the Commissioners had to justify their conduct in the present proceedings.

192. In our judgment they have failed to do so. We do not know why they stopped the car which Mr. Andrews was driving and required its three occupants to explain themselves. Mr. Smith merely states that they were stopped. He does not explain why they were stopped. In his fourth statement he explains Customs' general policy, which is to refrain from giving passengers the reasons why they are stopping them. He suggests, however, that the reasons "might include testing smuggling risk, or that the route you have travelled matches a known smuggling profile".

193. Mr. Anderson appeared to have some difficulty in explaining to us what this language meant, or how his clients could rely on these reasons for stopping individual passengers where there were no reasonable grounds for suspecting them as individuals. It seems to us that the mindset of those who were responsible for determining these policies has not embraced the world of an internal market where excise goods can move freely across internal frontiers, subject only to checks made when there are reasonable grounds for suspecting that an individual traveller holds alcohol or tobacco for a commercial purpose, and not for his own use.

194. We would therefore hold that because the Commissioners have not proved to us that there were reasonable grounds for stopping this car and questioning its occupants, the goods in it should not have been seized. Nor should the car. Furthermore, and quite independently, we consider that the Commissioners' refusal to return the car to Miss Andrews, without even considering whether it might be restored to her on payment of an appropriately proportionate sum (given all the circumstances of the case), represented a response which was just as disproportionate as their similar response in the case of Mr. Lindsay (see the principles set out in National and Provincial Building Society v United Kingdom (1998) 25 EHRR 127 at %5B80%5D). To equate her position with the position of a car owner who incurs a parking fine when his car, borrowed by a third party, is found illegally parked is to rely on an utterly untenable analogy.

195. It is unnecessary for us to determine in this case whether the implementation of the automatic vehicle seizure policy in the case of an innocent third party owner like Miss Andrews could be said to be "provided for by law" within the meaning of Article 1 of the First Protocol to the ECHR. We did not hear sufficient argument on this point, which it is unnecessary for us to decide on this occasion. We note that in the Strasbourg caselaw we were shown, the availability of judicial supervision appeared to point to a willingness to overlook the inaccessibility or unpredictability of the governing law in a case involving wide executive discretion so long as an independent tribunal has power to substitute a proportionate response.

196. In future, it will be for the appeal tribunal to consider the response which is proportionate in any given case. They should not feel constrained by what they may regard as a disproportionate executive policy founded on very wide statutory discretions but otherwise inaccessible or unpredictable law. If the remedies available to them at present do not give the courts or the tribunal the flexible powers they need, they should simply find some other way of giving effect to their conclusions, as happened in the Lindsay case.

197. For these reasons, while we would be disposed to make a favourable order relating to their costs, at present we see no reason to make any declarations in Hoverspeed's favour, as this judgment will speak for itself. We would quash the Commissioners' seizure of the excise goods belonging to Mr. and Mrs. Andrews and Mr. Wilkinson, and their seizure of Miss Andrews' car, and we will hear counsel as to the terms of any consequential relief (other than declaratory relief) these four claimants may still seek. Their claim for damages will be remitted to a single judge who should be invited to give appropriate case management directions.

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