Offshore off-licence
Encyclopedia
The "Offshore Off-Licence" is the name coined by the media to describe a 2004 venture to bring cut-price alcohol and cigarettes to the people of Teesside. Two businessmen, Phil Berriman and Trevor Lyons, used the latter's 72' staysail schooner
"Rich Harvest" to transport large quantities of cigarettes and spirits from Heligoland
(a tiny island in the German Bight
, off Jutland
) to Hartlepool
. The vessel was anchored just outside the UK's 12-mile limit, and people from Hartlepool came out in private boats to buy cheap "booze & fags".
After a storm, the "Rich Harvest" put into port, flying the yellow "Q" flag to notify HM Customs & Excise (now HM Revenue & Customs) officers that dutiable goods were aboard. Customs were unsure what to do. At first they merely sought to make the vessel secure, to prevent unlawful unloading. The next day, higher authority ordered the vessel to leave port within 36 hours, but just as the vessel was about to leave, Customs changed their mind and refused to allow the vessel and its cargo to depart. The cargo was seized and taken to a bonded Customs warehouse. Some weeks later, Customs decided to return the goods, but demanded that they be exported immediately. The goods were loaded onto a different vessel, a former Trinity House
support vessel called the "Cornish Maiden". (The much more valuable "Rich Harvest" was not used this time, in case it became liable to seizure and forfeiture).
The "Cornish Maiden" (which belonged to Berriman ) motored to a position 12 miles off Hartlepool, where it anchored and made ready for trade. By this time, a large 140' customs cutter was waiting, and stayed in attendance throughout daylight hours. Hartlepool residents who came out to buy goods were followed back to shore by a customs RIB
from the cutter. Potential buyers were scared off when Customs then announced that they would "seize any boat that visited " the Cornish Maiden. From then on, no sales were made, apart from a visit from journalists and cameramen from national newspapers. These media people bought token amounts of goods, but on arrival onshore, these goods were either seized or extra duty demanded. There were no further sales, and after the cutter gave warning that another storm was imminent, the "Cornish Maiden" packed up and headed for port.
The cargo was then seized again by Customs, who had obtained a magistrates court order for the cargo to be impounded. On appeal at Middlesbrough
Crown Court
, the judge was sympathetic to the venture and held that magistrates were wrong, and ordered the goods to be returned, saying that the "offshore off-licence" was not unlawful but that the seizure of the cargo was wrongheaded and unconscionable. At the 11th hour, Customs appealed to the Divisional Court
for a appellate review. On behalf of the venture, barrister Jeremy White relied on the Factortame case, arguing that HMRC's import regulations were arbitrary, restrictive and void for conflicting with the higher authority of EU
law; but the Divisional Court, reminiscent of the majority in Liversidge v Anderson, rejected this claim and ordered the case to be reheard in Middlesbrough. At this second Crown Court hearing, a new judge took a rather different view, holding that Customs had been entitled to seize the cargo.
Heligoland taxes & duties on the cargo had been paid in full. Lyons, a maritime law expert, and Berriman felt that they would have the support of the European Commission
, and they hoped that the case would be referred for a preliminary ruling
to the EU's European Court of Justice
in Luxembourg
. The argument at the ECJ was to have been that the UK action was both disproportionate and in breach of the Treaty of Rome's
requirement of "free movement of goods" between Member States
. Also, although Customs claimed that a "duty-free allowance" could be claimed only if one had been abroad, there appeared to be no legal requirement for this. First, passengers on English Channel
booze cruise
s were accorded a "duty-free allowance", even though they neither stepped ashore in France, nor necessarily entered French waters; secondly, a person abroad could buy goods for others provided he acted as agent; and thirdly, even HMRC regulations seemed to require only that the importer had left UK jurisdiction to obtain the goods, with no need to land abroad.
Nevertheless, the duo's funds for litigation could not match HMRC's "deep pockets", and the case proceeded no further. The cargo (comprising over a million cigarettes and a thousand bottles of spirits) which was being held partly by HMRC and partly by a private bonded warehouse, "InBond", was "disposed of" without notice, and no details were ever released of the cargo's final destination.
Schooner
A schooner is a type of sailing vessel characterized by the use of fore-and-aft sails on two or more masts with the forward mast being no taller than the rear masts....
"Rich Harvest" to transport large quantities of cigarettes and spirits from Heligoland
Heligoland
Heligoland is a small German archipelago in the North Sea.Formerly Danish and British possessions, the islands are located in the Heligoland Bight in the south-eastern corner of the North Sea...
(a tiny island in the German Bight
German Bight
German Bight is the southeastern bight of the North Sea bounded by the Netherlands and Germany to the south, and Denmark and Germany to the east . To the north and west it is limited by the Dogger Bank. The Bight contains the Frisian and Danish Islands. The Wadden Sea is approximately ten to...
, off Jutland
Jutland
Jutland , historically also called Cimbria, is the name of the peninsula that juts out in Northern Europe toward the rest of Scandinavia, forming the mainland part of Denmark. It has the North Sea to its west, Kattegat and Skagerrak to its north, the Baltic Sea to its east, and the Danish–German...
) to Hartlepool
Hartlepool
Hartlepool is a town and port in North East England.It was founded in the 7th century AD, around the Northumbrian monastery of Hartlepool Abbey. The village grew during the Middle Ages and developed a harbour which served as the official port of the County Palatine of Durham. A railway link from...
. The vessel was anchored just outside the UK's 12-mile limit, and people from Hartlepool came out in private boats to buy cheap "booze & fags".
After a storm, the "Rich Harvest" put into port, flying the yellow "Q" flag to notify HM Customs & Excise (now HM Revenue & Customs) officers that dutiable goods were aboard. Customs were unsure what to do. At first they merely sought to make the vessel secure, to prevent unlawful unloading. The next day, higher authority ordered the vessel to leave port within 36 hours, but just as the vessel was about to leave, Customs changed their mind and refused to allow the vessel and its cargo to depart. The cargo was seized and taken to a bonded Customs warehouse. Some weeks later, Customs decided to return the goods, but demanded that they be exported immediately. The goods were loaded onto a different vessel, a former Trinity House
Trinity House
The Corporation of Trinity House of Deptford Strond is the official General Lighthouse Authority for England, Wales and other British territorial waters...
support vessel called the "Cornish Maiden". (The much more valuable "Rich Harvest" was not used this time, in case it became liable to seizure and forfeiture).
The "Cornish Maiden" (which belonged to Berriman ) motored to a position 12 miles off Hartlepool, where it anchored and made ready for trade. By this time, a large 140' customs cutter was waiting, and stayed in attendance throughout daylight hours. Hartlepool residents who came out to buy goods were followed back to shore by a customs RIB
Rigid-hulled inflatable boat
A rigid-hulled inflatable boat, or rigid-inflatable boat is a light-weight but high-performance and high-capacity boat constructed with a solid, shaped hull and flexible tubes at the gunwale. The design is stable and seaworthy...
from the cutter. Potential buyers were scared off when Customs then announced that they would "seize any boat that visited " the Cornish Maiden. From then on, no sales were made, apart from a visit from journalists and cameramen from national newspapers. These media people bought token amounts of goods, but on arrival onshore, these goods were either seized or extra duty demanded. There were no further sales, and after the cutter gave warning that another storm was imminent, the "Cornish Maiden" packed up and headed for port.
The cargo was then seized again by Customs, who had obtained a magistrates court order for the cargo to be impounded. On appeal at Middlesbrough
Middlesbrough
Middlesbrough is a large town situated on the south bank of the River Tees in north east England, that sits within the ceremonial county of North Yorkshire...
Crown Court
Crown Court
The Crown Court of England and Wales is, together with the High Court of Justice and the Court of Appeal, one of the constituent parts of the Senior Courts of England and Wales...
, the judge was sympathetic to the venture and held that magistrates were wrong, and ordered the goods to be returned, saying that the "offshore off-licence" was not unlawful but that the seizure of the cargo was wrongheaded and unconscionable. At the 11th hour, Customs appealed to the Divisional Court
Divisional Court
A Divisional Court, in relation to the High Court of Justice of England and Wales, means a court sitting with at least two judges. Matters heard by a Divisional Court include some criminal cases in the High Court as well as certain judicial review cases...
for a appellate review. On behalf of the venture, barrister Jeremy White relied on the Factortame case, arguing that HMRC's import regulations were arbitrary, restrictive and void for conflicting with the higher authority of EU
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
law; but the Divisional Court, reminiscent of the majority in Liversidge v Anderson, rejected this claim and ordered the case to be reheard in Middlesbrough. At this second Crown Court hearing, a new judge took a rather different view, holding that Customs had been entitled to seize the cargo.
Heligoland taxes & duties on the cargo had been paid in full. Lyons, a maritime law expert, and Berriman felt that they would have the support of the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
, and they hoped that the case would be referred for a preliminary ruling
Preliminary ruling
A preliminary ruling is a decision of the European Court of Justice on the interpretation of European Union law, made at the request of a court of a European Union member state. The name is somewhat of a misnomer in that preliminary rulings are not subject to a final determination of the matters...
to the EU's European Court of Justice
European Court of Justice
The Court can sit in plenary session, as a Grand Chamber of 13 judges, or in chambers of three or five judges. Plenary sitting are now very rare, and the court mostly sits in chambers of three or five judges...
in Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
. The argument at the ECJ was to have been that the UK action was both disproportionate and in breach of the Treaty of Rome's
Treaties of the European Union
The Treaties of the European Union are a set of international treaties between the European Union member states which sets out the EU's constitutional basis. They establish the various EU institutions together with their remit, procedures and objectives...
requirement of "free movement of goods" between Member States
Member State of the European Union
A member state of the European Union is a state that is party to treaties of the European Union and has thereby undertaken the privileges and obligations that EU membership entails. Unlike membership of an international organisation, being an EU member state places a country under binding laws in...
. Also, although Customs claimed that a "duty-free allowance" could be claimed only if one had been abroad, there appeared to be no legal requirement for this. First, passengers on English Channel
English Channel
The English Channel , often referred to simply as the Channel, is an arm of the Atlantic Ocean that separates southern England from northern France, and joins the North Sea to the Atlantic. It is about long and varies in width from at its widest to in the Strait of Dover...
booze cruise
Booze cruise
Booze cruise is a British colloquial term for a brief trip from Britain to France or Belgium with the intent of taking advantage of lower prices, and buying personal supplies of alcohol or tobacco in bulk quantities...
s were accorded a "duty-free allowance", even though they neither stepped ashore in France, nor necessarily entered French waters; secondly, a person abroad could buy goods for others provided he acted as agent; and thirdly, even HMRC regulations seemed to require only that the importer had left UK jurisdiction to obtain the goods, with no need to land abroad.
Nevertheless, the duo's funds for litigation could not match HMRC's "deep pockets", and the case proceeded no further. The cargo (comprising over a million cigarettes and a thousand bottles of spirits) which was being held partly by HMRC and partly by a private bonded warehouse, "InBond", was "disposed of" without notice, and no details were ever released of the cargo's final destination.