The return effect in customs matters

The issue has historically been the subject of doctrinal debate, with frequently opposing positions. However, what once seemed limited to purely academic discussions is now beginning to acquire practical relevance in the customs field, as it involves the effective collection of taxes while a final decision is pending. 

Customs duties 

Customs duties have played a central role in Argentine history. Since independence, they have been conceived as a means of state financing to consolidate national unity, generating conflicts between Buenos Aires and the other provinces that formed the Confederation, due to the desire to maintain the power to oversee and collect these taxes. Initially, their primary function was revenue collection, although over time their extra-fiscal nature gained importance, understood as the use of customs duties to regulate foreign trade and protect domestic industry. It is no coincidence that the GATT itself recognizes the power of states to regulate international trade through the application of customs tariffs.ⁱ.

Despite this, the revenue-raising objective never ceased to be paramount. This is evidenced by various policies implemented over time: increased tax rates, stricter controls, and new strategies to combat maneuvers used by foreign trade operators to increase revenue.  

Within this framework, the General Directorate of Customs (DGA) has as its essential objective the control of the entry and exit of goods in international trade. To this end, the correct tariff classification, determination of origin, and customs valuation are indispensable functions that ensure effective control. These are complemented by other tasks related to the application of tariffs and prohibitions. Some legal scholars have indicated that the determination of duties is a function inherent to Customs, although not essential for its existence, since a control system based exclusively on prohibitions, quotas, and restrictions could be conceived even without customs duties.ⁱⁱ. 

However, in practice, the customs service has tended to confuse its primary role of control with a revenue-generating purpose. Customs duties should be collected and controlled by Customs as a means to ensure control of foreign trade, and not as an end in themselves. 

From 1996 onwards, with the creation of the AFIP, -now ARCA-, which integrated the General Directorate of Taxation and the General Directorate of Customs ⁱⁱⁱ The tension between two of the agency's functions—collecting and controlling—deepened. In this context, and given the constant search for new revenue collection tools, the question arises regarding the Customs authority's power to carry out tax enforcement actions while cases are pending resolution by the courts. 

In order to address this specific issue, referring to the possibility of demanding taxes without the existence of a final judgment, we consider it necessary to start from the analysis of the procedural regulations applicable to such cases. 

Appeal and its effects  

Article 1172, first part, of the Customs Code provides: 1. Appeals against judgments of the Tax Court in customs matters that order the payment of taxes, their updates, and interest shall be granted with suspensive effect only. In all other cases, the appeal shall be granted with both suspensive and devolutive effects, and the provisions of Article 1135 shall apply where appropriate.^iv 

As noted, the law is clear in that, in the event of a sentence to pay taxes, the appeal filed with the Chamber (Judicial Branch) will have devolutive effects. 

Now, to determine whether or not a tax obligation assessed by Customs is due, the matter can be addressed through two different procedures. The first is the appeal process, regulated in Article 1053 of the Customs Code, which is limited exclusively to the analysis of a tax-related issue. The second is the procedure provided for in Article 1080 of the same legal code, applicable to customs offenses. In this latter procedure, the necessary steps are taken to determine whether a customs offense has indeed occurred and, if so, whether the customs duties associated with said offense are due. 

In this regard, when the National Tax Court, through a judgment, upholds the decision made by Customs in an appeal proceeding and orders the payment of taxes, there is no dispute that, upon the filing of an appeal before the Court of Appeals, Customs may demand payment. This is by virtue of the provisions of Article 1172 of the Customs Code, which expressly establishes the devolutive nature of the appeal, without suspensive effect on the enforceability of the duties—by virtue of Article 1172 of the Customs Code—it will not have a suspensive effect, given that the rule expressly establishes that the appeal has a devolutive nature. 

The situation is different when dealing with a procedure for infractions, in which the ruling of the National Tax Court upholds the penalty imposed by Customs for an infraction. In these cases, the consequence of an appeal filed by the taxpayer is the suspension of all its effects, whereas the rule states that, in other cases, the appeal will be granted with suspensive effect. 

Up to this point, there is no apparent controversy regarding the provisions of the law for the two scenarios arising from procedures regulated by law in tax and infraction matters. However, the issue becomes less clear when, alongside the act alleged as an offense within the framework of a customs infraction, there is also a tax obligation. It is precisely in this scenario that the core of the doctrinal debate lies, particularly when Customs, in numerous cases, even before the conviction for the infraction that gives rise to the tax liability is final, proceeds to demand immediate payment of the duties, based on the confirmation, within the infraction proceedings, of the taxes involved in the dispute. 

Doctrinal positions 

One position holds that the devolutive effect applies exclusively to the challenged tax charges. Another, however, understands that in customs violations that involve both fines and taxes, the appeal should have a suspensive effect with respect to the fines, but a devolutive effect with respect to the taxes, replicating the scheme for tax charges. 

Before delving into these positions, it's important to remember that the devolutive effect is based on the principle of "solve et repete" (pay first, litigate later). However, in customs matters—unlike in tax matters—non-payment does not prevent processing. Nevertheless, both mechanisms share the same underlying principle, aimed at ensuring the immediate collection of revenue. However, their application in the customs sphere is debatable. This is because taxes are determined in dollars and paid in pesos, at the exchange rate in effect the day before payment, as stipulated by AFIP General Resolution No. 3271/2012v, and also accrue interest in foreign currency. Consequently, there is no significant depreciation that would justify requiring a prior payment as a tax guarantee. In turn, the eventual return of the sums paid —in case of revocation of the sentence— usually takes place months or even years later, in nominal pesos, which generates an economic loss derived from inflation and the loss of value of money for the one who, faced with a final resolution, is finally exempt from the obligation of payment that was imposed by virtue of the devolutive effect. 

Without prejudice to the fact that the central issue lies in analyzing what happens to taxes within the infraction processes, it is important to point out that, as indicated above, in principle there is no controversy regarding the devolutive effect that the resources have on the charges or strictly tax-related issues when there is no infraction.

Despite this apparent clarity, it is possible to question the way in which the legal framework enabling this effect is structured. As Dr. Míguez points out, the second paragraph of Article 1132 of the Customs Code establishes that challenges to tax charges may only be appealed before the National Tax Court. In turn, Article 1164 of the same legal code stipulates that this court cannot rule on the unconstitutionality of the regulations. 

This creates a complex situation in cases where the debate focuses on a purely constitutional issue, and therefore, since the defense is exclusively on that point, it means that the individual can only fully exercise the guarantee of due process before the Chamber, after having paid the taxes or faced an execution, and consequently, the principle of "double conformity" is affected.^vi 

Returning to the central point of this note, regarding Article 1172 of the Customs Code and its effects, we observe, on the one hand, the customs service's position, which interprets the suspensive effect as limited to fines or confiscation, while considering taxes as having a devolutive effect. However, contrary to this position, much of the legal scholarship maintains that the appeal should have a full suspensive effect on the entire judgment, both in relation to the penalty and any taxes that may be due as a result of the infraction.  

One of the arguments the customs service uses to support its position is related to the statute of limitations for collection actions. While filing an appeal suspends the running of the time limit, this suspension ceases thirty (30) days after the Tax Court issues its ruling. Therefore, customs officials are trying to proceed with enforcement. 

Consequently, the statute of limitations resumes once a judgment authorizing enforcement is issued. This is because, in the case of customs duties, the statute of limitations is suspended from the commencement of the proceedings and is suspended again each time the taxpayer files an appeal against the customs decision. The suspension remains in effect until a decision authorizing enforcement of the debt is issued.^vii 

In this regard, Customs maintains that the Tax Court's ruling—pursuant to Article 1172 and its devolutive effect—ends the suspension of the statute of limitations. Therefore, to prevent the five-year statute of limitations from expiring, the agency is proceeding with enforcement. 

Meanwhile, the doctrine that does not share the customs position maintains that the statute of limitations should not resume.^viiiSince the Tax Court's ruling on tax-related infraction proceedings would not have a suspensive effect, in practice, Customs faces a considerable risk if it chooses not to proceed with enforcement, given that even those who support the suspensive effect argument could raise statute of limitations defenses.

Regarding this position of practical necessity invoked by the customs service in order to avoid extinction due to the passage of time, several doctrinal questions remain. 

One of these distinctions is between a "ruling" and a "conviction." In this regard, it is important to clarify that Article 1172 of the Customs Code refers to judgments that order the payment of taxes, while in infraction proceedings, the National Tax Court does not issue a conviction regarding taxes, as it merely rules on their existence or applicability. This distinction is essential, since Article 1112, subsection b), of the same legal code establishes that, in infraction matters, there is no conviction for taxes, but rather a ruling.^ix Consequently, the tax enforcement provided for in Article 1172, paragraph 2, would not be applicable to such cases. 

At this point, it is important to highlight, given the nature of the procedure, that when dealing with a strictly tax-related charge, the controversy centers on determining whether or not the taxpayer is obligated to pay an additional sum in customs duties, and their defense is limited to this aspect. Conversely, in cases investigating customs violations, the taxpayer's defense focuses on disproving the very existence of the violation, which, in many instances, entails the accessory obligation to pay duties. In such situations, filing an appeal with the Court regarding the alleged violation has a suspensive effect, which in turn suspends the payment of duties, as this is an accessory obligation to the alleged violation. 

It is important to remember that the Supreme Court of Justice of the Nation has indicated that, while the determination of the existence of the infraction is pending before the Court of Appeals or the Supreme Court, Customs cannot enforce a tax debt whose cause is not yet final. If the penalty is revoked, the precedent that gave rise to the tax assessment disappears, and its enforcement is prevented.^x 

Thus, some legal scholars hold that, in matters of customs violations, the penalty is based solely on the fine, while any applicable taxes are contingent upon the conclusive determination of the existence of a customs violation. In these cases, the individual is sanctioned for an act linked to a fine, which is why the suspension of the penalty takes precedence over any taxes associated with the same act.^xi 

In turn, Drs. Guillermo Felipe Coronel and Guillermo Sueldo, in their Annotated Customs CodeThey consider that section 1 of article 1172 of the Customs Code, which states that “appeals of judgments of the Tax Court in customs matters that order the payment of taxes, their updates, and interest, shall be granted with suspensive effect only,” refers solely to judgments concerning appeal proceedings pursuant to article 1053 of the Customs Code, that is, exclusively tax-related disputes. Therefore, this provision is not applicable to judgments that address infractions and that, where applicable, may contain tax determinations arising from the infraction.^xii 

Likewise, considering the criminal nature of customs offenses—and even though there are schools of thought that frame them within the scope of administrative law, as Dr. Miguel Licht argues—^xiv along with other jurists—, the protection of the double conformity principle and the assurance of sufficient judicial control must prevail in any case. 

Therefore, as Dr. Miguez points out, if the National Tax Court's ruling were to be condemnatory, it would constitute a deficiency in the double jeopardy guarantee, since there would not be, at least, a ruling from a reviewing judicial body. Consequently, if the criminal nature of these infractions is accepted, all appeals should be exhausted before any collection process can proceed.^xv 

General Instruction No. 9/2004 and Note No. 98/11 (DG ADUA.) 

General Instruction (DGA) No. 9/2004 establishes that, once a conviction has been handed down by the National Tax Court and the term provided for in article 1172 of the Customs Code has expired, the Judicial Department must send a certified copy to the customs office of origin for the preparation of the Debt Certificate and the subsequent promotion of its execution.

Similarly, both this instruction and Note No. 98/11 (DG ADUA) stipulate that, in the face of a judgment of the Tax Court that condemns exclusively the payment of taxes and interest, the agents of the customs service must proceed immediately to prepare the debt certificate and demand its compliance. 

Both documents constitute internal directives that guide the actions of customs agents within the framework of the application of Article 1172 of the Customs Code. However, their scope is expressly limited to cases of a strictly customs tax nature, excluding those in which the application of taxes and penalties such as fines or confiscation are discussed jointly. 

This criterion is clearly derived from the very terms used in the aforementioned administrative acts. For example, the preamble to General Instruction No. 9/2004 specifically refers to “legal cases of a purely tax and customs nature in which the National Tax Court has issued judgments ordering the taxpayers to pay taxes and interest.” Similarly, Note No. 98/11 refers to the same factual scenario, reiterating the use of expressions such as “charge” and “legal cases of a purely tax and customs nature.” 

Legal scholars have pointed out that these directives do not apply to Tax Court rulings confirming penalties imposed by customs in summary proceedings when these include both taxes and fines for customs violations. In such cases, it has been interpreted that enforcement can only begin once the judgment is final and has acquired the force of res judicata, since it is not possible to separate the tax payment order from the corresponding penalty.^xvi 

The Appeal in “both effects”

Procedural doctrine has held that granting an appeal "with both suspensive and devolutive effects" implies the suspension of the execution of the appealed ruling (cf. art. 243, Code of Civil Procedure), with the non-suspensive effect being an exception. Consequently, in customs matters, it is considered that judgments that simultaneously impose penalties and duties should not be executed until there is a final ruling confirming the infraction. 

Regarding the scope of Article 1172 of the Customs Code, which provides for the granting of an appeal "with suspensive effect," legal scholars interpret this as necessarily implying the suspension of the execution of the appealed decision and its immediate referral to the higher authority for a decision. This is the interpretation supported by Gozaini.^xvii 

Similarly, Kielmanovich clarifies that the term “both effects” can be analyzed from two dimensions: 

1. Regarding the enforceability of the appealed decision (suspensive and devolutive effects). 

2. Regarding the procedural opportunity for its substantiation, substantiation and resolution (immediate and deferred effects).

It should be noted that when the law refers to the granting of the appeal "with both effects", it must be understood that this implies, on the one hand, the suspension of the execution of the appealed resolution (suspensive effect) and, on the other hand, the referral to the superior court, in the traditional sense of the term "devolutive", that is, the "return" of the competence to the superior magistrate, that is, suspending the compliance or execution of what was decided.^xviii 

Based on these interpretations, it can be understood that Article 1172 of the Customs Code imposes a devolutive effect only with respect to proceedings challenging tax debts of a strictly fiscal nature. Conversely, when dealing with judgments of the Tax Court that order the payment of taxes within the framework of infraction proceedings, a devolutive effect should not be automatically attributed. 

Otherwise, it would imply separating the tax component from the infraction procedure, which is inappropriate. A tax claim arising directly from an alleged infraction cannot be considered autonomously and independently. In these types of cases, a cause of "strictly tax content," as required by the first sentence of Article 1172 of the Customs Code, is not established, and therefore, the appeal should not be granted a merely devolutive effect. 

However, beyond questioning the lack of regulatory clarity, which leads to different interpretations regarding the treatment of taxes within the infraction processes, this ambiguity is also reflected in everyday practice. 

In the area of ​​tax litigation, there are cases where, after a ruling by the National Tax Court, Customs chooses not to initiate tax enforcement proceedings, while in others—albeit exceptionally—it does. Although this is not necessarily an illegitimate action, since Customs retains the power to decide whether or not to pursue enforcement, this disparity creates uncertainty for taxpayers. This situation not only highlights the lack of clear regulations but also suggests administrative conduct that can be perceived as erratic. 

It is here that the principle of "legitimate expectation" becomes particularly relevant, especially when the position is maintained that the infractions are administrative in nature. This principle has been incorporated through Article 1 bis of the National Law of Administrative Procedures (Law 19.549). It is worth recalling that, according to Article 1017 of the Customs Code, the National Law of Administrative Procedures applies supplementarily in proceedings before the customs service, except in those of an infraction or criminal nature. 

In this regard, one of the most relevant aspects of the reform introduced by Law 27.742 is precisely the establishment of the principle of "legitimate expectation," which requires that the administrative authority act in a consistent, predictable, and reasonable manner, especially when adopting measures that restrict individual or collective rights or when imposing requirements for the exercise of activities. The authority must always choose the least restrictive alternative, justify the need for the measure based on the public interest, and demonstrate its suitability for achieving the intended objectives, avoiding any form of unequal or discriminatory treatment. 

Thus, Article 25 of Law 27.742 lists among the fundamental principles of the administrative procedure legality, reasonableness, proportionality, good faith, legitimate expectation, transparency, effective administrative protection, administrative simplification and good administration. 

In turn, some authors relate article 1067 of the Civil and Commercial Code to the principle of trust, which states that, “the interpretation must protect the trust and loyalty that the parties owe each other, and contradiction with a legally relevant, prior and own conduct of the same subject is inadmissible.”^nineteenth 

In light of this regulatory framework, legal certainty should prevail, which is distorted by disparate conduct of the customs administration, as evidenced by the issuance of demands for payment of taxes confirmed by a ruling of the National Tax Court, while in other identical cases—both due to the nature of the tax and the ruling of the same court—no claim has been made until a final judgment is issued. 

However, it is also true that the fact that the administrative authority does not always act uniformly does not, in itself, imply a violation of the principle of legitimate expectation. An illustrative example would be that of a person who repeatedly parks in a prohibited place without receiving any penalty; if on a subsequent occasion their vehicle is towed and they are fined, they could not claim a violation of this principle. For there to be an actual infringement of legitimate expectation, other elements must be present, such as arbitrary or intentionally contradictory conduct on the part of the administration. 

Despite this doctrinal discussion, there is no doubt that the principle of legal certainty must prevail, especially in an area such as international trade, where order and predictability are essential for proper development.

Conclusion 

The interpretation of Article 1172 of the Customs Code regarding infraction proceedings involving both fines and duties continues to generate significant debate within the customs legal field. As we have observed, there are at least two clearly distinct positions: one that considers that the appeal should have suspensive effect with respect to the fine, but be devolutive with respect to the duties; and the other that, since the enforceability of duties depends on the existence of an infraction, they should be included in the suspensive effect along with the fine, as they are subordinate to the proceedings concerning the infraction. 

Ultimately, the controversy revolves around a key question: what effect should the appeal have on taxes when they are incorporated within an infraction process? 

Given this dilemma, the need for greater regulatory clarity is evident, as it would dispel interpretive doubts and ensure a more uniform application of the law by both the administration and the courts. As long as this ambiguity persists, the risk of disparate decisions and infringements on fundamental principles will continue to be a central concern for legal professionals specializing in customs law. 

Consequently, considering that Article 1172 of the Customs Code aims to establish procedural guidelines by differentiating the effects of an appeal against a judgment ordering the payment of taxes—which is devolutive in nature—and those applicable to other situations, a distinction is evident between purely tax-related procedures and other procedures, such as those concerning customs infractions. In this sense, when the process for addressing an infraction involves tax aspects, the effect of the appeal is suspensive with respect to everything related to said procedure. This interpretation is reinforced by the fact that, generally speaking, the effects of appeals tend to suspend the execution of decisions, with the exception only being that immediate execution is required when so established by law. 

This general rule should prevail, given that it is crucial to consider that the possibility of immediate enforcement, in the absence of automatic suspension, can have significant practical consequences for those subject to the regulations. Measures such as seizures, tax foreclosures, or the inability to release goods stem directly from this situation, affecting not only the right to a defense but also the financial and logistical planning of foreign trade operations. These aspects should not be overlooked when interpreting the regulation or proposing solutions, especially considering the concrete impact on economic activity.  

In conclusion, we note that, at a time when changes to customs regulations are anticipated, the solution may lie in implementing a reform that eliminates any ambiguity. In the meantime, it is the opinions of judges, expressed through their rulings, that can resolve these conflicting positions between the customs enforcement and tax regimes. 

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Highlighted

ⁱ General Agreement on Tariffs and International Trade, Art. XI. 

ⁱⁱ Ricardo Xavier Basaldúa: Concept and essential and contingent functions. Page 45. 

ⁱⁱⁱ Decree 618/97. 

^iv Article 1172: 1. Appeals against judgments of the Tax Court in customs matters that order the payment of taxes, their updates and interest, shall be granted with suspensive effect only. In other cases, the appeal shall be granted with both suspensive and devolutive effects and the provisions of Article 1135 shall apply where appropriate. 2. In the case of a judgment ordering the payment of taxes, their updates and interest, if payment of the amount owed is not proven within THIRTY (30) days of notification of the judgment or from the notification of the resolution approving the assessment made, before the customs service, the latter shall issue ex officio a certificate of debt based on the judgment or assessment, as appropriate, for the purposes of its execution. 

^v Likewise, our highest court has upheld this position (Volkswagen Argentina SA, TF 22.179-A).

^vi Miguez, Adrián. Effect of appeals against judgments of the National Tax Court in customs matters. Need for review of the regulations. Errepar. 

^vii Art. 805 of the Customs Code. 

^viii Lascano, Julio Carlos. The effects of the appeal against the judgments of the National Tax Court in customs matters. Tarifar. 

^ix Art. 1112. 1. Once the argument has been presented or the period provided for doing so has expired and, where applicable, adding the legal opinion and having produced the measures that may have been ordered to better inform, the administrator must issue a resolution within SIXTY (60) days, in which: 

a) will convict or acquit the accused; 

b) will rule on the taxes that the responsible parties may owe; 

c) may extend the interdiction and seizure measures provided for in Article 1085, paragraph 1, subparagraphs b) and c), to other merchandise that is in customs premises in the name, on behalf of or that is owned by the debtors, guarantors or responsible parties and that is not affected by the summary proceedings; 

(d) may order the customs service to request the appropriate judge to issue a precautionary attachment, general lien on assets, or any other precautionary measure against the debtor's assets that, under the circumstances, are suitable to provisionally ensure compliance with the ruling. The precautionary measure shall be enforced under the responsibility of the Treasury for the amount of the judgment plus any applicable taxes. 

^x CS, Kristinus, Helge v. National Customs Administration re: contentious claim, 12/16/82). 4) That paragraph 2 of Article 172 of the Customs Law in force at the time of the event stipulated that “Anyone found responsible for non-compliance with the condition imposed on the benefit shall be sanctioned with the penalties provided for in Article 198, third paragraph, without prejudice to the collection of the duties or difference in duties that may have been waived.” It follows from the transcribed rule that the right of the tax authority to collect the relevant taxes derives from the responsibility of the offender. Therefore, when the sanction imposed was revoked due to the establishment of a cause exempting from liability, the precedent that gave rise to the assessment of the taxes whose payment the appellant seeks disappeared. 

^xi Cancellieri, Hernán. Improperness in demanding the payment of taxes in customs infractions in the face of unfavorable judgments issued by the Tax Court that have been appealed to CNACAF by the administered parties. 

^xii Coronel, Guillermo Felipe and Sueldo, Guillermo, Annotated Customs Code, Volume VI.  ^xiv Licht, Miguel Nathan, “Theory of administrative wrongdoing”, The substantive nature of administrative sanctions, La Ley, Thomson Reuters, (2024), Volume I, pp. 1, 2, 3. 

^xv Miguez, Adrián. Effect of appeals against judgments of the National Tax Court in customs matters. Need for review of the regulations. Errepar. 

^xvi Lascano, Julio Carlos, “The effects of the appeal against the judgments of the National Tax Court in customs matters”, Tarifar. 

^xvii Gozaini, Osvaldo A. Treatise on Civil Procedural Law, Volume III “…the granting of an appeal with 'both effects' obliges the suspension of the execution of the appealed decision (art. 243, Code of Civil Procedure) and the immediate referral to the higher court for resolution. The granting of an appeal without suspensive effect is exceptional…” 

^xviii Kielmanovich, Jorge. Civil and Commercial Procedural Code of the Nation. Annotated and Commented, p. 521 ^nineteenth Coviello, Pedro José Jorge. “Legitimate trust in the National Law of Administrative Procedures”. Page 1.