The European Commission has decided to refer Poland to the Court of Justice of the EU over Polish regulations on exemption from excise duty of ethyl alcohol used to manufacture medicinal products not aligning with EU law requirements.

The case was initiated by a complaint being lodged by DZP with the European Commission over the infringement, by the provisions of the Excise Duty Act, of EU regulations on exemption from excise duty of ethyl alcohol used to manufacture medicines. The dispute over the compliance of Polish regulations with EU regulations is therefore entering a new phase, as the European Commission has shared the doubts raised by DZP about the correct implementation of Council Directive 92/83/EEC into the Polish legal system.

According to the European Commission:

"EU excise duty rules provide for a mandatory exemption from excise duty for imports of ethyl alcohol used in the production of medicines. Polish national practices, however, do not grant this mandatory exemption when the alcohol importers do not choose to use a duty suspension arrangement”.

If the CJEU finds that the Polish regulations are flawed, there will potentially be new opportunities for importers – both for future transactions and for those already made.

DZP advisers on the case were: Artur Nowak, Partner, Jan Czerwiński, Senior Tax Manager, and Paweł Suchocki, Tax Manager, from the Tax Practice.