Judgment of the Court (Eighth Chamber) of 5 December 2024.Network One Distribution SRL v Agenţia Naţională de Administrare Fiscală – Direcţia Generală Regională a Finanţelor Publice Bucureşti and Others.Reference for a preliminary ruling – Customs union – Incurrence and recovery of a customs debt – Regulation (EU) No 952/2013 – Recovery of anti-dumping duties relating to imports from China – Charging of interest on arrears under Regulation No 952/2013 – National legislation providing for the imposition of a late payment penalty in addition to interest on arrears.Case C-506/23.

This judgment concerns the interpretation of Article 114 of the EU Customs Code regarding the charging of interest on arrears and additional penalties for late payment of customs duties. The case arose from a dispute between a Romanian company and tax authorities over anti-dumping duties on bicycle imports from China.The Court analyzed whether EU law allows member states to impose both interest on arrears under EU customs law and additional late payment penalties under national law. The key distinction made is that interest on arrears compensates for delayed payment, while penalties serve as sanctions for non-compliance.The main provisions examined include:

• Article 114 of the Customs Code on charging interest on arrears for late payment of customs duties
• Article 42 giving member states authority to impose penalties for customs law violations
• Articles 4-5 of Regulation 2988/95 on administrative measures versus penalties

The Court concluded that EU law does not preclude national authorities from imposing both:

• Interest on arrears under Article 114 of the Customs Code to compensate for delayed payment
• Additional late payment penalties under national law as sanctions, provided they are proportionate

This creates a dual system where both compensatory interest and punitive penalties can apply simultaneously.

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