C-59/72

JUDGMENT OF THE COURT

12 JULY 1973 <apnote>1</apnote>

Wünsche Handelsgesellschaft

v Commission of the European Communities

'Tomato concentrates'

Case 59/72

Wunsche Hamburg, represented by its associate Handelsgesellschaft ,

bearing liability, personal the management company Ludwig Wünche mbH, itself represented by its manager, Jan-Onne Bodenstab, assisted by Rechts­

anwälte Modest, Heemann, Gündisch, Rauschning, Landry, Röll, Festge, and

Heemann of the Hamburg Bar, with an address for service in Luxembourg at the office of Félicien Jansen and Mme Jeanne Jansen-Housse, huissiers de

justice, 21 rue Aldringer,

applicant,

Application for the payment of damages under the second paragraph of

Article 215, of the EEC Treaty, as compensation for damage caused by Regulation EEC No 1643/71 of the Commission introducing a system of

minimum prices for imports of tomato concentrates from Greece,

THE COURT

composed of: R. Lecourt, President, R. Monaco and P. Pescatore, (Presidents

of Chambers), A. M. Donner, J. Mertens de Wilmars, H. Kutscher, C. Ó Dálaigh, M. Sørensen (Rapporteur) and A. J. Mackenzie Stuart, Judges,

1. (a) The common organization or the by the Council in a second Regulation

market in products processed from fruit No 1428/71, also dated 2 July 1971 (OJ L 151, 7. 7.1971, p. 6). and vegetables was established by Regulation (EEC) No 865/68 of the The protective measures which the

Council, of 28 June 1968 (OJ L 153, 1. Community may take are listed in 7. 1968, p. 8). Article 2 (1) of this Regulation:

In the absence of co-ordination or any '(a) The total or partial suspension of unification of import regulations applied imports or exports; by each Member State vis-à-vis third (b) a system of minimum prices below countries, the Council felt it necessary to which imports may be subjected to enact Regulation No 1427/71 of 2 July the condition that they must be 1971, (OJ L 7. 1971, p. 5) to 151, 7. made at a price above the minimum 'make it possible for the Community to fixed for the goods in question'. deal with serious disturbances to which

the market in these products could be Article 3 of Regulation No 1428/71 exposed by reason of imports effected on confirms that the Commission is bound terms, and in particular at prices which to apply these measures 'while rejecting

WÜNSCHE v COMMISSION

price, that in this way the applicant The first measure, enacted by Regulation incurred loss, that this loss was caused No 1558/71 (OJ L 164, 22. 7. 71, p. 14) applies to third countries by Regulation 1643/71, that this excluding Regulation is illegal and that, therefore, Greece, and establishes a system of by Article 215 of the EEC Treaty, the quantitative restrictions; the second, Commission is bound to pay enacted by Regulation No 1643/71, compensation for the loss suffered. applies to Greece and provides for a

By letter dated 28 June 1972, the system of minimum prices. Commission informed the applicant, that By Article 2 of the latter, the issue of an it was unable to meet this claim. import licence is subject to a written

from the importer to 2. The validity of the Regulation was undertaking ensure: examined in the judgment given by the Court of Justice of the European '(aa) Communities in case 40/72 on a request

(bb) this importation arises from a for a preliminary ruling in proceedings

contract providing for sale and between I. Schroeder KG, Hamburg, and delivery free at Community the Federal Republic of Germany. In this

frontier, or at a place situated judgment the Court stated that 'The outside the Community, at a price examination of the questions which have higher than that shown in the been put has shown nothing which

during October 1971, relying on the and statement of defence had been stability of the minimum price laid down lodged, the written procedure was

in Regulation No 1643/71, it purchased suspended until judgement had been a quantitiy of double-strength tomato given in case 40/72. After hearing the

concentrate from a Greek company, that report of the Judge-Rapporteur and the

it had to conclude the contract at the opinion of the Advocate-General, the

minimum price despite a more Court of Justice decided to open the oral favourable offer made by the Greek procedure without any preparatory vendor, that developments in the market inquiry.

JUDGMENT OF 12. 7. 1973 — CASE J9/72

The Commission submits that the Court stabalization of referred to

should: subparagraph (1) (c). The applicant

maintains that such a system of — dismiss the action as unfounded and opportuni­ minimum prices offers many order the applicant to pay the costs for misapplication, ranging from the —

ties of the action conclusion of fictitious contracts for the —

alternatively, by way of a provisional recovery of payments made in excess

order, reserve a decision on the either in cash or in kind, to the

right to raise the plea of inadmissibility, system of minimum prices established by Article 2 of Regulation No 1643/71 contrary to its previous actions in similar cases. The Commission points would thus be infringed and incapable of out, however, that in this case, the applicant's attaining its objectives. rights could have been legally protected, In this connection the applicant refers to

without running the risk of incurring so the judgment given by the Court of

much greater loss, by an application to Justice in case 6/71 (Rec. 1971 p. 8239) the national judicial and administrative in which the Court took the view that

authorities. any Regulation encouraging clearly wrongful behaviour was illegal. According to the applicant, the

application is admissible as a claim According to the applicant, a statement based on administrative responsibility of Italian prices for tomato concentrates

fulfilling the conditions referred to in the free at the German frontier shows that

and 1428/71 of the Council. The (b) In its application, the applicant Council expressly decided in these maintains that the system of minimum Regulations that only appropriate prices referred to in Article 2 of measures might be applied in order that Regulation No 1643/71 is contrary to the objectives of Article 39 of the EEC certain fundamentel principles of law. It Treaty be not endangered. infringes the principle of proportionality As regards the question or the by worsening the conditions in which 'appropriate' nature of the measure in imports are made without offering any dispute, having regard to the equivalent advantage. The system also

opportunitites for fraud and misappro­ infringes the legal certainty principle of

priation, the Commission replies that an in that the possibilities for manipulating identical system is provided for by it introduce an element of legal Article 44 of the EEC Treaty. uncertainty into importing operations.

In its decision Importers longer hope to of 4 April, 1962 (OJ No could no

30, 10. 4. 1962, p. 995), putting into conclude and settle their buying and

operation the two minimum price selling transactions under normal

circumstances that the the quantitiative restrictions imposed, establishing the Commission maintains that this system in dispute is fundamentally complaint amounts to an examination of unsuitable. The mere possibility that the the order of priority of the protective legislation may be unlawfully manipulat­

'legal' measures. ed is not sufficient. As regards the The Commission submits that the possibilities of evasion, the Commission that do the second ground for complaint concerning notes they not affect

intended to restrict the principle of legal certainty does not efficiency of a system

imports It would correspond with reality. The fact that and stabilize markets.

be if certain products from Greece could be only otherwise an importing through imported without applying the minimum company used the profit made

the intervention of its subsidiary in order price, does not render the importer

JUDGMENT OF 12. 7. 1973 — CASE 59/72

quantitative restrictions. Of the two quantities of goods 'on the opening of

measures provided for in Article 2 (1) of the frontiers'. The main justification was Regulation No 1428/71, an importer's the desire to avoid freezing trade

liberty is restricted less by the total or relations with Greece and to leave a

partial abolition of imports than by the margin in which such relations might

system of minimum prices. This order of develop naturally, while having regard

prices: one leading to a reduction or (d) The applicant maintains that the temporary suspension of imports, the minimum prices were fixed at too high a other simply making imports subject to level and thus had a prohibitive effect.

an undertaking to respect the minimum Minimum prices should not exceed price. prices in force within the Community. In The Commission which, when drawing fact the minimum price exceeded by up the protective measure in question, 24 % the offer price quoted by Italian had to take account both of the manufacturers of tomato concentrates.

Regulation and the Agreement, had The prohibitive effect of the minimum

every reason to give preference to the price was shown by the 50 % reduction

second system, as representing the most in the import of Greek concentrates. reasonable solution. Moreover, the applicant maintains that

There are several justifications for this the Commission ought to have adjusted

control measure. By acting as a valve The applicant maintains that the

allowing the continuous import into the Commission was required to have regard Community of limited quantities, the to paragraph (3) of Article 41 of the

minimum price system reduced the risk Association Agreement with Greece from of flooding the market with considerable which it might be inferred that minimum

WÜNSCHE v COMMISSION

prices were to be fixed in such a way as this case, remained more or less to avoid adversely affecting trade with unchanged.

that country. It was, however, noticeable In the opinion of the Commission, the that the total volume of imports to minimum price level does not amount to Member States fell by approximately an infringement of Article 41 of the 50 %, principally as a result of a Agreement with Greece. It is clear from reduction in the volume of Italian this provision that minimum prices were imports. not to affect the trade in tomato con­

borne again issues system was out by the reduction certain which were

in its insufficiently by Schroeder imports, contradicts submission emphasized

that the system was inefficient. in its observations and with which the

Court accordingly could not deal. 1 he Commission does not dispute the in its rejoinder the commission accuracy of the figures showing that the considers that the judgment given in the offer price for Italian tomato concentrate Schroeder case has deprived the action in the period August 1971 —

February for damages of all foundation, since the 1972 remained lower than the minimum reasons put forward in this case against price fixed. These prices, however, gave the validity of Regulation No 1643/71 no indication of the cost prices for the were examined also in the context of the industry within the Community, as they Schroeder case and the Court did not represented only individual offers, and deny its validity. The Commission even if they were symptomatic they considers that the applicant has shown would show simply that the effect of no new reason for a revision of the price stabilization had not yet made itself foregoing judgment. The Commission apparent during the first months after refrains, therefore, from dealing in detail the adoption of the protective measure.

The Commission finds it impossible to with the submission made by the

from June 1972. In the opinion of the Commission doubts the relevance of

applicant, this information led the Court information produced by the applicant

into error and in fact the increase in concerning offer prices for Greek tomato market prices was solely the result of the concentrate.

news that the whole of Southern Europe As regards information supplied by the would have a bad tomato crop in the applicant imports into concerning summer of 1972. But for this, the failure Member States other than Italy, the

of the system of minimum prices would Commission that increases in observes have been obvious. imports must be measured in relation to The applicant that the system the quantity imported; such imports maintains

was actually abused. It is impossible to representrelatively minor quantities as explain otherwise the continued compared with Italian imports. The

Community act cannot depend on first envisaged according to this restrospective considerations of its assumption by each of the two Articles efficacy'. Moreover, in reply to a The suspension of imports, also overlap.

question put by a Member of the Court provision for which was made in Article during the oral procedure the 2 (1) (a), of Regulation No 1428/71 Commission had stated it to be correct depends only on a finding that goods are that during summer, 1972, world market being imported below a price limit fixed prices had, generally speaking, reached internally — in fact a minimum price. In minimum price levels. It was, therefore, the the feature circumstances, therefore, impossible to say with certainty what a and sufficient was merely necessary developments would have taken place in condition for the application of the

the absence of this fact. According to the quota system. This followed from Article Commission, offer prices for Italian 1 (d) of Regulation No 1428/71. A tomato concentrate during the first half tendency towards an excessive decrease of 1972 certainly showed a tendency to could only be recorded where a

rise. Evidence of this tendency could be particular price is fixed internally as a

produced before the Court, but the price limit (minimum price).

WÜNSCHE v COMMISSION

to avoid the

connexion, to apply the principle that, obligation. The applicant also points out

where a choice exists between an appro­ that in 1969, at the time when a

priate and an inappropriate measure, it minimum price system was already to be is always the less severe which should be adopted for the preserved fruit and

selected. vegetable market, various instances had

The drawn the Commission's attention to the applicant maintains that recourse to consequences and the possibilities of the total or partial suspension of manipulation which would ensue. imports, for which provision was made

The used by the Italian Ministry of (d) applicant agrees with the Agriculture to establish cost prices, it principle involved in the reasoning of the was clear that in doing this the Court in its judgment in the Schroeder case, that 'the legality of a Community Ministry was basing its calculations on

flat-rate amounts. The fact that Italian act cannot depend on retrospective

its efficacy' tomato contrates were always offered at considerations of and that

it 'suffices that at the moment of their around 30 u.a. tends to show that the

adoption it does not appear that they are cost prices of Italian producers were still lower than this The obviously inappropriate to contribute to amount. offer price

the realization of the desired object'. In on the German market includes the

for Italian tomatoes in 1970 slightly higher than the intervention offer prices price. and 1971 — the sole criterion which could

be established by the Italian Ministry of Agriculture in the fixing of the cost 2. On the existence of a breach of duty prices — show that the amount

representing the purchase price of the The applicant maintains that the basic product was itself already fixed too Commission has committed a breach of high at 20 lire per kg of tomatoes. The duty. The Commission is bound by the purchase price of a kg of tomatoes in provisions of the EEC Treaty, and to the 1970 varied between 13 and 19 lire. The extent to which, for the enforcement of 1971 harvest was offered at a rate of 16 to 19 lire per kg. rules made by the Council it exercises

powers conferred by the Council, it is Recalling the line of argument developed bound by the same rules. The system of by the Commission in judgment 17/72 of minimum prices infringes not only the 8 November 1972, the applicant provisions of the EEC Treaty but also maintains that the Commission should the decisions taken by the Council have made its own calculations on the Commission empowering the to adopt basis of the statistical information which Commis­ protective measures. Had the it had itself acquired from the producing sion made a thorough examination of

companies. the conditions required it must have The prohibitive effect of the minimum been aware of the illegality vitiating the price was evident in Italy where no system of minimum prices, all the more

import transactions were concluded so as it had been made clear to it on Novem­ during September, October or several occasions that the effects which

in August 1971, varied more or less prices. The Commission's departments between 15 and 19 lire per kg, August had for their part checked these figures being the month in which prices are at and had found no reason to doubt their their lowest. The Commission considers accuracy. If, nevertheless, these prices

that the prices to be paid by the industry were now shown to be inaccurate after

must necessarily be higher than the level all, the Commission could in no way be of intervention prices, as, if this were not held liable.

WÜNSCHE v COMMISSION

In its reply the applicant submits that the transactions in the Federal Republic of

Commissions's breach of duty lies in its Germany on 25 and 26 January and 15 having manifestly forgotten the existence February 1972. The purchase price of a choice between two protective amounted to DM 5-60 per tin, taking measures available, and that it ought to into account the rate of exchange. In adopt only the less severe of the two, order to be able to meet Italian that is to say, the most suitbale. competition, the applicant was obliged

concentrates, apart form those intended The total loss suffered on the sale to the for Italy, had not decreased and were Meinke was DM 780. As company still being offered at prices below the regards his loss of profit, the applicant

minimum. Had suitable measures been claims the usual profit margin only taken, positive results should have represented by 5 % of the selling price, later. Further is in case, DM 318, appeared about one month that to this say, evidence of the Commissions's negli­ loss DM bringing the total suffered to gence in adopting the system of 1 098. minimum prices is shown by the fact The applicant maintains that this loss that Regulation No 1643/71 was only was increased by other sales, as it was revoked by Regulation No 395/73 of 9 forced to carry out all the purchases February 1973, although from autumn which it had previously promised to 1972, bad tomato crops had resulted in is first make. However, the applicant the offer price for Greek tomato making this claim only in respect of loss concentrates rising above the minimum resulting from sales made to the Meinke price. company.

The Commission maintains that there

are certain basic objctions and 3. On the alleged loss suffered reservations with regard to the

calculation of damages. Even supposing The applicant states that, on 6 October that the elements involved in the 1971, in performance of a contract made calculation were the following realistic, with Agend S.p.A., an associate of the questions remain: Greek company, Greek Export, Athens, it bought 100 metric tons of (a) Did the goods actually come from double-strength tomato concentrate. stocks bought at the minimum price? Despite a more favourable offer of $US (b) Was the applicant in reality under 270 cost and freight port of Hamburg an obligation to purchase all the goods? made by the Greek vendor, it had to

could seriously question the existence of metric ton.

the necessary causal link. In any case, if The applicant replies that to appreciate these the the were circumstances, the facts, it must be noted that on both 6 applicant should have waited for general October and 29 December also on 1971, price levels to adjust themselves in order it purchased 100 metric tons of

to prevent or avoid loss. double-strength Greek tomato concen­

trates at the minimum price of $US 340 (d) The Commission states that the

loss estimated by the applicant amounts per metric ton. According to the

applicant, two memoranda annexed to to approximately $US 60 per metric its reply make it clear that the delivery ton. This amounts to saying that the of the goods in question to the Meinke minimum price was at least $US 60 per company on 7 March 1972 arose out of metric ton too high — that is to say, that the contracts made on 6 October and 29 it should have been at most $US 280 December 1971 with Greek Export. It per metric ton. The applicant's was clear from these two contracts that calculation appears accurate if it is the transactions were not subject to any accepted that Greek concentrates had conditions enabling the applicant to free been offered to him at $US 270 per met­

It loss must be estimated in terms of the ton. was impossible, therefore, to say in had prices at which Greek tomato that after prices Germany become $US concentrates were available. It states generally established at

loss that, between September and October 280, with the result that the 1971 and April and May 1972 calculated by the applicant was in any case overestimated. quotations made by Greek forwarding agents for double-strength concentrates

(e) The Commission points out that varied between $US 260 and $US 265, the result is the same if the calculation is cost and freight port of Hamburg. The based on the assumption that the system applicant maintains that it was therefore of minimum prices is only illegal because compelled to bring the offers made to the price level was fixed too high. the Meinke company into line with

Assuming that Italian cost prices were general price levels for fear of being overestimated and that the minimum- unable to conduct any business at all.

Grounds of judgment

1 By this application, made on 24 August 1972, Wünsche Handelsgesellschaft of Hamburg requests that the Commission be ordered to pay compensation for losses which it claims to have suffered following the introduction of a system

The validity of Article 2 of Regulation No 1643/71 has already been examined by the Court in case 40/72, on a request for a preliminary ruling from the administrative court (Verwaltungsgericht) of Frankfurt-am-Main, in proceedings between I. Schroeder KG, Hamburg, and the Federal Republic of

Germany concerning the same pleas as in this case;

In its judgment of 7 February 1973 in the above case, the Court decided that examination of the questions put by the national court had shown nothing which could cast doubt on the validity of Article 2 of the above Regulation, and that neither Article 2 (1) of Regulation (EEC) No 1428/71 of the Council of 2 July 1971, nor Article 41 of the Agreement establishing an association

between the European Economic Community and Greece, of 9 July 1961

creates an order of priority between the measures provided for therein;

3 In nevertheless pursuing this action the applicant wished to bring evidence in addition th that already produced in case 40/72 and to stress certain points

protecting individuals;

5 It must be concluded, therefore, that the conditions in which the Community

may incur liability under the second paragraph of Article 215 are not present, and that the application must be rejected;

Costs

6 By Article 69 (2) of the Rules of Procedure the unsuccessful party shall be ordered to pay the costs;

The applicant has failed in his pleas;

THE COURT

hereby:

1. dismisses the action as unfounded;

WÜNSCHE v COMMISSION

2. orders the applicant to pay the costs.

Lecourt Monaco Pescatore

DELIVERED ON 4 JULY 1973 <apnote>1</apnote>

Mr President, co-ordination or unification of the

import arrangements applied by Member Members of the Court States vis-à-vis third countries.

I — The Facts Because of disturbances which were

threatening the relevant market as a

Wünsche Handelsgesellschaft, a partner­ result of extensive imports at prices

Common Market from third countries consider the provisions of these

were originally liable only to the Regulations in the case of Schroeder, payment of Common Customs Tariff 40/72 (Judgment of 7 February 1973, duty. Furthermore there was no not yet published).

1 — Translated from the French.