C-95/74

Compagnie Continentale France (98/74), represented by Jean-Denis Bredin, Advocate at the Cour de Paris, with an address for service in Luxembourg at the chambers of Georges Margue, 20 rue Philippe-II,

Compagnie Algerienne de Meunerie SA (15/75), represented by Edouard Brisac, Advocate at the Cour de Paris, with an address for service in Luxembourg at the chambers of Georges Margue,

Comptoir Commercial Andre et Cie (100/75), represented by Claude Lussan, Advocate at the Cour de Paris, with an address for service in Luxembourg at the chambers of Georges Margue,

applicants,

v

COMMISSION OF THE EUROPEAN COMMUNITIES, represented by its Legal Advisers Peter Gilsdorf and Bernard Paulin, acting as Agents, with an address for service in Luxembourg at the office of its Legal Adviser, Mario Cervino, Bâtiment CFL, place de la Gare,

composed of: H. Kutscher, President of Chamber, President, A. M. Donner, J. Mertens de Wilmars, P. Pescatore, M. Sørensen, Lord Mackenzie Stuart and A. O'Keeffe, Judges,

Advocate-General: A. Trabucchi

Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts

between those quotations or prices and Before the Commission's decision, the the prices in the Community may be covered by an export refund. exporter has no guarantee of being able to effect the operation in question under The amount of this export refund, which specific conditions. fluctuates from day to day according to A minimum quantity of 75 000 metric the price level on the world market as tons is required before a licence valid for established by the Commission's services, an exceptional period is granted. is normally that applicable on the day of exportation. Nevertheless, in order to 2. Compensatory amounts provide the exporter with a measure of security, the export refund may, at the The compensatory monetary amounts, request of the exporter addressed to the devised initially to deal with the competent national agency, be fixed in temporary increase in the margin of advance at the level ruling there on the fluctuation of the Deutschmark and of day on which application for an export the Guilder were instituted by Regulation licence was made. (EEC) No 974/71 of the Council (OJ 1971, L 106, p. 1; OJ (English Special As regards the period of validity of the Edition) 1971 (I), p. 257. The export licences, the Community rules compensatory amount is obtained by know two different systems. At the applying a certain percentage to the relevant time the normal period was two representative world market price for the months following upon the date of the product in question. Since it is broadly application for an export licence (Article based, it cannot take into account the 1 of Regulation No 133/73). A longer specific circumstances relating to a period intended to facilitate some special particular transaction. The compensatory exports was laid down for individual amount cannot be fixed in advance but is cases (Article 24 of Regulation No always that in force at the date of 2637/70). exportation. The system of compensatory monetary amounts was changed in order The grant of this longer period of validity to deal with the situation created by the is dependent upon a prior decision of the progressive revaluation of the other Commission, taken after consulting the Community currencies and devaluation Management Committee on the basis of of the US dollar. particulars furnished by the competent national agency. In February 1973 the method of calculation of the compensatory The decision of the Commission lays monetary amount, which remained the down the period of validity granted and same notwithstanding different changes, further prescribes that the contract was as follows:

The compensatory amounts ... shall be p. 10; OJ (English Special Edition) 1972 equal to the amount obtained by (II), p. 345) laying down special applying to the prices the percentage provisions in respect of levies and difference between: refunds fixed in advance for cereals, — the parity of the currency of the which still remains in force, provides a Member State concerned declared to special system in the event of changes in and recognized by the International the calculation of compensatory Monetary Fund, on the one hand, and monetary amounts. — the arithmetic mean of the spot market rates of this currency against The second recital in the preamble the US dollar during a period to be thereto reads: determined (Article 2 of Regulation No 974/71). 'Whereas the present system of compensatory amounts is likely to The mean of the US dollar rate is found change considerably with the gradual during the period of reference return to a more stable monetary (approximately three weeks) preceding situation; whereas this may lead to the weekly fixing of the compensatory a significant reduction in the amount. compensatory amounts which would not be due either to a fall in spot market Article 7 of Regulation No 974/71 (as rates or in prices;' amended by Regulation (EEC) No The fourth recital reads: 2746/72 of the Council of 19 December 1972) lays down that: 'Whereas ... it might no longer be '1. With effect from 1 July 1972, for possible, in view of the reduced the purposes of the financing of the compensatory amounts, to effect exports common agricultural policy, the for which the refund has been fixed in compensatory amounts granted in advance, since the calculations of the trade with third countries shall be parties concerned were based on the treated as part of the expenditure on granting of refunds fixed in advance and refunds granted on exports to third of these compensatory amounts which, countries. in most cases, have not changed much 2. With effect from 1 January 1973, for over a relatively long period; whereas the the purposes of the financing of the adverse effects of this situation could also common agricultural policy, the be avoided by maintaining the economic compensatory amounts charged or situation which faced the parties at the granted in trade with Member States time of the advance fixing.' shall be treated as part of the expenditure on intervention intended The fifth recital reads: to stabilize the agricultural markets'. 'Whereas it is fair to give the parties Under the provisions of Article 8 (2) of concerned the opportunity of cancelling Regulation No 974/71, which still the advance fixing, while maintaining remains in force, the regulation their obligation to import or export.'

and of the refund according to the On 21 March 1973 the Commission date of exportation. made and published its price proposals Under the provisions of the fourth recital for the 1973/74 marketing year, laying in the preamble to Regulation No down the compensatory amounts. Until 648/73 of the Commission of 1 March the adoption of these proposals by the Council, the Commission continued to 1973 (OJ 1973, L 64, p. 1) laying down detailed rules for the application of apply the system of compensatory 'monetary' compensatory amounts which amounts laid down by Regulation No result from Regulation No 509/73 974/71 which, whilst subject to several amendments, did not undergo important 'Whereas it should be stressed that changes in its fundamental structure. compensatory amounts are essentially quite different from levies and refunds'. In the interval between the publication of the Commission's proposals on the With the devaluation on 13 February amendment of Regulation No 974/71 1973 of the US dollar, which gave rise to and its adoption by the Council on 30 April 1973 contracts were entered into the adoption of Regulations Nos 509/73 and 648/73, the international monetary between the applicants and the importers crisis continued. The abnormal influx of in the USSR and Poland, these being transactions which resulted in the dollars which again occurred in several Member States, obliged the latter to take applicants' claim in Cases 95 to 97/74 special defensive measures. and 15/75, and, in part, in Case 98/74.

During a lengthy period in which the By Regulation No 1112/73/EEC of the money markets were closed, the Council of 30 April 1973 (OJ 1973, L measures to be taken by the Member 114, p. 4) which entered into force on 1 States were laid down in the course of a May 1973, the wording of Article 2 (1) of Regulation 974/71/EEC was amended as meeting of the Council of the Ministers follows: for Finance on 11 and 12 March 1973.

Whereas operators have been aware of the new rules to be applied to parities Under the provisions of Article 3 of laid down by Council Regulation (EEC) Regulation No 1112/73, that regulation No 1112/73 of 30 April 1973, amending shall apply 'from the date on which the Regulation (EEC) No 974/71 ...; detailed rules required for its application ... enter into force'. Whereas, however, the date of ap­ plication of the new system was fixed on On 18 May 1973 the applicant in Case 4 June 1973 by Commission Regulation 100/75 entered into a sale contract with a (EEC) No 1463/73 of 30 May 1973 laying Japanese company, such contract down detailed rules for the application of forming the basis of its application. monetary compensatory amounts;

COOPERATIVES AGRICOLES DE CÉRÉALES v COMMISSION, COUNCIL

They were split into following conditions: 278 extracts, relating to a total of 226 919 metric tons, issued between Union Nationale des Cooperatives the beginning of May and end of Agricoles de Cereales, the holder of 131 July. extracts of certificates relating to 169 599 (2) Two certificates applied for by the metric tons of barley for export to the Compagnie Continentale France on USSR which resulted from the splitting 2 April for the export of barley to the of five certificates granted between 20 USSR with validity to 30 June and 24 April, the original applications for (normal period of validity) and being which had been lodged on 30 March the subject of three extracts in respect 1973 by the Compagnie Continentale of 1 906 metric tons, issued between

This extract was part of a Compagnie Continentale France certificate applied for by the Compagnie between 2 and 22 May in respect of Continentale France on 30 March with a the export of common wheat to the period of validity to 31 July (exceptional USSR to take place by 31 July period of validity) and issued between 20 (normal period of validity) the and 24 April. subject-matter of 88 extracts, relating to a total of 191 017 metric tons, The Société de Commerce, de Stockage et issued in July. d'Études de l'Ouest Européen is holder of La Compagnie Algerienne de Meunerie

The validity). extract was transferred to the applicant by the Compagnie Continentale France Le Comptoir Commercial Andre et Cie is on or about 20 July. holder of an extract in respect of 14 000

metric tons of barley for export to Japan. of the dollar. At any rate, even with this This extract forms part of a certificate new method of calculation of the export applied for by Établissements G & P refund, the latter was as from June 1973 Levy on 11 May 1973 with a period of reduced to nil. As against this, those of validity to 31 July (normal period of the applicants who were able to obtain validity). It was forwarded to that the advance fixing of the export refund at undertaking on 27 June 1973 under the the amount thereof as at 30 March provisions of a protocol between benefited from a maximum refund of 38 Établissements J & P Levy and the u.a. per metric ton. As from 5 June some applicant dated 24 May 1973. of the applicants drew the Commission's attention to the fact that the new system 4. In April 1973 a protocol was signed applied to exports which remained to be by ten French cereal exporting carried out in relation to certificates companies governing the execution of a already issued and they asked for contract of 28 March 1973 entered into transitional measures to be adopted. between those companies and VO Exportkhleb of Moscow for the delivery The applicants received under the of 500 000 metric tons of barley provisions of Regulation No 2042/73 and produced in France. This contract was at their request the compensatory negotiated by the French Government. amount in force on 3 June 1973. The In this case it is a 'prestige contract' reference period for the purposes of the involving a reduced profit margin. The mean rate of the US dollar for the applicants in Cases 95 to 98/74 are part purpose of calculating this amount was of the 'France Cereales' consortium. the period from 17 to 23 May, the rate at that time being FF 4 425. Under the provisions of Article 3 of the protocol of April 1963, the Compagnie The applicants consider that if the Continentale France was responsible for former method of calculating com­ all administrative action, both with the pensatory amounts had remained in force French authorities and, if need be, those they would, as at the actual date of of the common market, including the export, have benefited from a application for certificates relating to compensatory monetary amount in export, the obtaining of refunds and excess of that which was in force on generally all negotiations with the said 3 June 1973. authorities, with power to compromise in the event of litigation. This explains why the majority of the export certificates II — Procedure

for the purposes of procedure and 'Order the Council and the Commission judgment. jointly and severally to pay it the sum of FF 418 369-47 by way of damages, plus By order of 26 September 1975, Case interest as prescribed by law, as from the 100/75 was added to Joined Cases 95 to date of the claim.' 98/74 and 15/75 for the purposes of procedure, the applicant waiving its right In Case 98/74 to lodge any further statement. As regards the possible liability on the part The applicant claims that the Court of the Community, the defendants should indicated that their statements filed in '(1) Order the European Economic Cases 95 to 98/74 and 15/75 were also Community as represented by the deemed to be statements lodged in Case Council and the Commission to pay 100/75. it the sum of FF 11 662 442-21 by way of compensation for the Upon hearing the report of the damages which it has suffered in the Judge-Rapporteur and the views of the circumstances set out above, together Advocate-General the Court decided to with interest at the discount rate of open the oral procedure without any the Banque de France from the date preparatory inquiry. The Court asked the when the present application was applicants in Cases 95 to 97/74 to lodged; produce copies of the original export (2) And further order the European certificates and the applicant in Case Economic Community as repre­ 98/74 to produce copies of the contracts sented by the Council and the Com­ relating to the exports in question. mission to pay the entire costs of the present proceedings.' III — Conclusions of the parties In Case 15/75

to Japan which it effected after 4 June 1973 under Certificate No 'Declare applications 95 to 98/74, 15/75 FA/079593 —Extract FA/112019, and 100/75 inadmissible and in any by the violation of the applicant's event illfounded, reject them and order vested rights or at least the violation the applicants to pay the whole of the of the general rule by virtue of which costs'. the legitimate expectation of persons concerned with regard to the The Commission claims that the Court application of rules in pursuance of should which they have entered into commitments deserves protection; 'Reject applications 95 to 98/74, 15/75 (b) Declare alternatively that its and 100/75 and order the applicants to application against the European pay the costs of the action.' Economic Community as repre­ sented by the Council of the Euro­ pean Communities and the Com­ IV — Summary of the sub­ mission of the European Communi­ missions and arguments of ties is admissible and well founded, the parties in reparation for the injury suffered by the applicant on the occasion of 1. Admissibility exportations of barley after 4 June 1973 under export certificate No The Council pleads inadmissibility in the FA/079593 — Extract FA/112019, case of applications 95 to 97/74 on the in view of the wrongful acts or ground that the applicants, having omissions committed by the acquired by way of transfer which took Commission first by leaving cereal place after 4 June certificates dated prior exporters until 28 July 1973 in a to that date, cannot claim that there had state of uncertainty as to the been an infringement either of their transitional measures to be adopted right to legal certainty or to vested rights. with regard to the implementation of On that date, that is to say on 4 June, the the new system of monetary Commission's implementing regulations compensatory amounts applicable as were already in force. Since the grounds from 4 June, and secondly by not on which the applicants rely are thus taking account in its Regulation No vitiated the applications are inadmissible. 2042/73 the fact that in any event cereal exporters could not undertake In reply, the applicants in Cases 95 to any operation to cover their 98/74 point to the existence of the exchange risk in relation to the trading partnership (societe en dollar before 5 June 1973 at the participation), France Cereales of which earliest; they are members. Within the framework (c) in either case order the European of this partnership the Compagnie Economic Community to pay the Continentale France was instructed to applicant, if necessary after expert obtain all the certificates which were checking of the statement produced ultimately transferred to the other by the applicant the sum of FF members. The Compagnie Continentale 175 368-61 by way of compensation France had thus managed the interests of with interest at the discount rate of an association of which the applicants the Banque de France as from the were members. The fact that the date on date of this application and further which the export certificates had been order the European Economic forwarded was subsequent to 4 June Community to pay all the costs'. 1973 cannot deprive them of a right of

The practical effect of Regulation No Whilst it is true that in cases where the 1112/73, in the case of exportation from a Member State to a third country, even contract provides for payment in dollars and that the value of the dollar at the though there are fluctuations as between the rate of the US dollar and the time of the transaction has changed as exchange rate of the currency by that compared with its value at the time when Member State within the framework of the contract was concluded, the trader the common agricultural policy, is to was more or less protected under the deny any compensation for such fluc­ former system against the unfavourable tuations. consequences of such a change. This is a question of fact which depends on a number of individual circumstances and Since they no longer correct the effects of a failure to adjust the currency of one in no way on the objective of the former Member State in relation to its US dollar system.

3. The applicants' rights 723) is not completely on all fours with the present case. It is obvious that there In the opinion of the applicants in Cases is a difference between the rules on 95 to 97/74 Regulation No 1112/73 is compensatory amounts for sugar and illegal by reason of the effects which it those for cereals. had on the transactions which were previously entered into and the fact that, The applicant in Case 98/74 argues that affecting vested rights as it does, it has a the act of delivery of the export retroactive effect. certificates comprising advance fixing A vested right of barley exporters to results in the vesting of the following

Exporters is acquired on the same basis as the who found themselves in the right to refunds; applicant's position were entitled to (iii) Regulation No 1112/73 had laid refunds which did not take into down that it applied not immediately account monetary variations. At the but only as from the day when the same time they were denied the necessary rules for its application specific compensatory monetary came into force, which implies a amount intended to cover these very desire on the part of the legislator to variations; see an end to transitional measures, (iii) By transforming an option for the necessary by reason of the existence Member States to grant compensa of a vested right. tory amounts into an obligation, in the event of a currency, fluctuating The judgment in Case 1/73 — beyond the limits laid down, Westzucker v EVSt/Zucker ([1973] ECR Regulation No 509/73 of the

Council attached to the issue of any (2) regulations must not be of an certificate a right to receipt of the uncertain and variable nature, compensatory amounts payable as especially as they concern public soon as the conditions laid down by policy. the regulations were fulfilled. The system of compensatory amounts This analysis is confirmed by Regulation constitutes a specific mechanism with a No 2042/73 of the Commission: specific function, requiring independent (i) Having laid down transitional rules of implementation in relation to provisions for making good injury the refunds.

It implements the infringement of vested rights. In decision whereby the financing of order to remedy this infringement compensatory amounts is no longer done the regulation, which recognizes on a national but on a Community basis. exporters' rights to a guaranteed rate of exchange, arbitrarily limits that The fact that the rate of compensatory guarantee to that by which they amount to be granted is that applicable would have benefited if all the valid on the day of exportation precludes any certificates had been cleared by 3 assimilation of function and calculation June 1973. between compensatory amounts and advance fixing of the refund. The applicant in Case 15/75 contends that the system of compensatory The function and nature of the monetary amounts in force before 4 June compensatory monetary amounts are 1973 provided cereal exporters with a very different from those of refunds. guarantee against exchange risks in Compensatory amounts represent a relation to the dollar. Under the monetary corrective which allows the provisions of this system the applicant unity of prices to be maintained on the had completed an export certificate with market notwithstanding the abandoning the refund fixed in advance. The of fixed exchange parities.

vested rights: For pressing reasons of economic policy (1) the individual decision on the basis the institutions can legitimately apply of which a vested right is invoked new provisions to the situations which must relate to the same matter as that came about while the old law was in to which the right attaches; force, cf. Case 57/72 Westzucker ([1973]

Article 8 of Regulation No 974/71 only In Cases 95 to 97/74 the applicants argue means that the Council has recognized that they entered into commitments with that compensatory amounts are not their Soviet trading partners on the basis perpetual but rather an exception to the of the Community regulation existing on unity of the market. The transient nature the day of concluding the export of compensatory amounts is also contracts. The completion of the indicated in the six recitals in the Community certificates took place preamble to that regulation. Another sign without exceptionally urgent measures is the multiplicity of amendments. having been taken for the shipping of Finally, Regulation No 837/72 laid down the cargo since the applicants were what had to be done in case of confident that the compensatory amendment of the provisions governing amounts would be awarded to them in the calculation of compensatory conformity with the legislation existing amounts. at the time of issue of the export certificates. Accordingly, even in the In the opinion of the Commission there absence of any illegality in the was in the system of compensatory regulations of 30 April and 30 May 1973, monetary amounts a deliberate the Community authorities ought to abstention from introducing the make good the injury suffered by the possibility of advance fixing. applicants by reason of the application of these regulations to export certificates In this respect the Commission refers to obtained prior to their publication. the two possibilities already afforded by Regulation No 837/72 in the event of an The applicants are of the opinion that as amendment of the rules of calculation of long as the system of compensatory the compensatory monetary amounts. amounts provided for in Regulation No 974/71 and Regulation No 2746/72 The monetary amount cannot in general remained in force they could not in fact be likened to the refund provided for by have acted otherwise. They did not know the agricultural regulations since their and had no means of knowing that the

amendments of the regulations comprising advance fixing of the refund concerning compensatory amounts were as comprising equally an implied contemplated. The existing information 'promise' to apply the system of did not show precisely the date on which compensatory monetary amounts in force the new regulations would enter into on 30 March 1973 to the exports of force. It would have been impossible barley which it was to effect on the basis without speculating on the fall in value of the certificate having a period of of the dollar, to adopt a position other validity limited to four months, all the than the one they had adopted. more so, since it was and moreover still is the rule in the international cereal In the opinion of the applicant in Case trade for the large majority of export 98/74 Regulation No 509/73 of the sales to be effected in dollars.

Numerous factors contributed to the between the day when if effected the applicant's feeling certain that, as regards forward sale of dollars and the day on the transactions in respect of which which it effected its exports the applicant export certificates had been issued before would have been obliged to pay a 4 June 1973, it was entitled to receive compensatory monetary amount, thus compensatory amounts to bridge the gap suffering a considerable loss. resulting from fluctuations in the US dollar. Under the provisions of its contracts the The very wording of Regulation No applicant could neither cancel nor 1112/73 gave no cause at all for accelerate its exports. apprehending that in respect of contracts already running there would be any kind The applicant in Case 100/75 points out of modification in the method of that its expectation that the former calculation of compensatory amounts method of calculation of compensatory and of the refunds relating to exports to amounts would be applied deserved third countries. protection by reason of its obligation to export during the period of validity of The applicant in Case 15/75 considers the certificate at the risk of losing the the issue of the export certificate whole or part of the deposit lodged.

with immediate effect and without warning; As regards the rights arising from the (v) that the Community should have export certificates forwarded after 4 June taken no transitional measures 1973, the applicants ought to have been which would have enabled a on their guard bearing in mind the 'prudent' trader either to avoid change in the system which in fact had sustaining the loss or to obtain taken place. compensation, Case 74/74 CNTA v Commission ([1975] ECR 533). Neither were the losses inevitable. The applicants could have taken steps, at least as from 4 June 1973, to cover the The applicants for certificates with an exchange risk. Between 30 April and 4 exceptional period of validity had no June there existed a theoretical risk of a guarantee at the time of making the rise in the value of the dollar to the application of obtaining such a extent that it might have exceeded the certificate. The deposit which at that old parity, thus making it possible for time they were obliged to lodge would there to be a compensatory amount. As not have been forfeited in the event of from 4 June on the other hand, the non-completion of the contract but fluctuation in the dollar could no longer being a temporary deposit would have have the slightest influence on the been refunded if it had been established before the issue of the certificate that the calculation of the compensatory amount. transaction could not be effected. Before At that time the only risk to which the issue of the certificates no transaction traders were subject if they sold their can be considered as irrevocably binding dollars forward and there was later a rise within the meaning of the Court's case-law. in the dollar, was that of losing a profit.

adopted in order to provide for the case of applicants who obtained certificates In the view of the applicants in Cases 95 with an exceptional period of validity. to 97/74 the transitional measures do not alter the fact that damage was suffered. In any event it must not be forgotten The Community's liability is incurred by that the Community authorities had the breach in the principle of equality of warned the interested parties that the all before charges resulting from the public interest was at stake and that common monetary policy. transitional measures were in existence; no Community liability could therefore In the view of the Compagnie arise: cf. Case 74/74 CNTA v Continentale France the contents of the Commission ([1975] ECR 533). transitional measures and the conditions under which they were applied Legitimate expectation to which traders demonstrate their defective and irrational can lay claim must not blind them. nature. The exporters of agricultural products who obtained certificates after 4 In any event, having acquired their June, the date when the new system certificates from the Compagnie came into force, had their monetary Continentale France in June/July 1973, compensation assured by means of after the appearance of Regulation No refunds which henceforth incorporated 1463/73 the applicants in Cases 95 to the compensation for fluctuations in the 97/74 cannot pretend to have been dollar. As against this, under the former surprised by that regulation. system the applicants were given advance fixing or their refunds, that is to say of As regards the certificates applied for in the refunds the amount of which does May with a normal period of validity not take into account the fluctuations in until the end of July, the dates of the dollar.

Through the Commission's default, The Commission, considering that the cereal exporters remained until 28 July applicant's real complaint relates to the 1973 in a state of uncertainty as to the absence of an adequate transitional transitional measures which were going system, replies that the transitional to be taken with a view to applying the system of Regulation No 2042/73 was a new system of compensatory amounts. purely equitable measure which the Commission was free to adopt or not to So long as the former system of adopt. Whilst this regulation may result compensatory monetary amounts in traders suffering damage, bearing in covering cereal exporters against mind the course taken by the dollar, this exchange risks in relation to the dollar does not mean that such damage can be remained applicable and the interested attributed to the Community. In a case of parties were not aware of the date on advance fixing, the traders were in a which it would cease to apply, a cereal somewhat uncomfortable situation so exporter, for the reasons already that it was therefore justified and indicated, could do nothing to protect equitable to adopt a transitional measure himself against fluctuations of the dollar. in their favour.

Regulation No 2042/73 does not take The Commission's power in equity and into account the fact that the belated without legal obligation to adopt such publication of Regulations Nos 1463/73 transitional measures arises under Article and 1469/73 of 30 May 1973 in the 6 of Regulation No 974/71 which, within Official Journal of 4 June 1973 had by the framework of the Management any reckoning prevented exporters of Committee procedure, confers wide cereals from taking any measure to cover powers on the Commission which may the exchange risks to which they were involve other derogations from subject, not only until 3 June but until at regulations relating to the common the very least 5 June 1973. agricultural policy.

would continue to move. After 4 June Even assuming that the transitional 1973 therefore it was up to exporters to system set up by the Commission was cover themselves against the exchange not entirely satisfactory or that it had risk inherent in the future movement of been possible to take wider transitional the dollar by, for instance, selling forward measures on the lines desired by the those dollars which they expected to applicants, the Commission's view is that receive from the other parties to their still nothing approaching a really serious contracts. and flagrant infringement would have occurred. Even if the principle of liability Besides, given the fact that nothing in in the absence of illegality were accepted, the regulations which entered into force here too the damage complained of must on 30 April 1973 gave reason to suppose still be the consequence of a sufficiently that there would be any transitional flagrant violation of a superior rule of measure in respect of old contracts, the law. The situation in the present case is applicants had no valid ground for far removed from one in which the awaiting such measures without taking legislature has infringed the principle of precautions. equality of public charges by causing the applicants any particular and serious The interested quarters ought to have damage. been aware of the fact that the Commission showed little enthusiasm for The effective discontinuance of taking transitional measures. In fact, the compensatory monetary amounts delay which occurred in adopting occurred after a delay of more than a Regulation No 2042/73 was largely due month from the publication of to the Commission's considerable Regulation No 1112/73 which clearly hesitation whether to take this course. allowed the effect on the French market The Commission's experience in to be anticipated. The difference as connexion with other transitional compared with the situation in the measures had been discouraging. The CNTA case (above referred to) is possibilities thus made available to the therefore clear. Besides, the trade had in fact been abused and in discontinuance occurred after numerous particular, fictitious contracts had been warnings. submitted to the competent national administrations so as to benefit from the The Commission is not obliged to take more favourable transitional system. This measures which re-establish the legal experience had led the Commission to position of parties as if the change in be careful before adopting such legislation had not taken place. The fact measures. The fact that an exporter has that these measures were adopted after obtained an advance fixing for, say, 30 some delay caused no damage to the March 1973, in no way implies that he applicants. These measures at least has already concluded his contract at that included some compensation for that date. He might perfectly well have part of the losses which the exporters concluded it at a later date and thus had been unable to avoid by measures to already have taken into account the new cover the exchange risks. The transitional method of calculation of the monetary measures also may afford compensation amounts. (cf. the CNTA case, above referred to).

1 These six applications ask that the Community be ordered to pay various sums by way of compensation for the damage caused to the applicants by the application of the new method of calculation of compensatory amounts introduced by Regulation No 1112/73 of the Council (OJ 1973, L 114, p. 4) in respect of exports for which export certificates had previously been granted.

2 Even though the damage arising from the application of this new method was lessened by the transitional measures adopted by the Commission in its Regulation No 2042/73 (OJ 1973, No 207, p. 34) these are claimed not to have been sufficient wholly to counter its effect.

Admissibility

3 Without expressly raising an objection of inadmissibility the Commission criticizes the applications in Cases 95 to 98/74 in relation to Article 37 (4) of the Rules of Procedure in that there are not annexed thereto the contracts and

certificates relating to the exports on which the applicants rely in order to establish that they became entitled to have the compensatory amounts calculated by one particular method or that they acted in expectation of this method's continuing to be applied.

COOPÉRATIVES AGRICOLES DE CEREALES v COMMISSION, COUNCIL

10 Whilst the fact that the applicants received certain extracts by way of transfer from third parties may be of importance in relation to the substance, it cannot affect the admissibility of the application.

Substance

11 In the first place the applicants point out that the application of the new method of calculation of compensatory amounts to exports which they had

JUDGMENT OF 10. 12. 1975 — JOINED CASES 95 TO 98/74, 15 AND 100/75

earlier committed themselves to undertake adversely affected the rights which they acquired by the grant of export certificates comprising advance fixing of the amount of the export refund.

12 Whilst admitting that compensatory amounts cannot be fixed in advance they consider that the method of calculation thereof in force at the time of

18 The system of the Community unit of account expressed by reference to a certain weight of gold originally allowed the fixing of single prices for the whole Community, thanks to the fixed relationships between the Community currencies.

19 The financial occurrences in 1971, characterized by the de facto abandonment of the international rules relating to margins of fluctuation of rates of exchange, led the Council to institute a system which allowed the

COOPÉRATIVES AGRICOLES DE CÉRÉALES v COMMISSION, COUNCIL

Member States if necessary to levy compensatory amounts on imports and to grant them on exports, both in trade with the other Member States and in trade with third countries.

20 This system was intended to neutralize the effect of the monetary measures on the prices of certain basic agricultural products in respect of which intervention prices had been laid down and thus to avoid a diversion of trade.

21 The provisional nature of the system of compensatory amounts is emphasized by Regulation No 974/71 of the Council, Article 8 (2) of which provides that it 'shall cease to be applicable as soon as all the Member States concerned again apply the international rules on margins of exchange rate fluctuation...'.

27 For as long as the rate of exchange of the United States dollar was taken into consideration for the purpose of calculating compensatory amounts the system in fact ensured a measure of protection against the risk of devaluation of the dollar where the contract was expressed in that currency.

28 Since notwithstanding the devaluation of the United States dollar in February 1973, the pressure on that currency in the early part of the year continued, the Council decided in the course of its meeting on 11 and 12 March 1973 that on the one hand the central, banks of the Member States should cease to

support the dollar and on the other hand that the currencies of six of the Member States should float vis-à-vis other currencies whilst keeping to certain margins of fluctuation as between themselves.

29 Consequently, following upon the Council's request of 12 March 1973, the Commission on 21 March 1973 proposed to the Council that reference to the dollar should be abandoned and replaced as regards the six Member States whose currencies were floating together, by reference to central rates and, in respect of the three other Member States, by reference to representative rates established on the basis of the rates found to exist on the market during a given reference period.

30 The possibility of the adoption by the Council of the Commission's proposal of 21 March, which had been expected since 12 March and immediately became known in interested quarters, both through the press and through their regular contacts with the Commission, became more likely day by day, all the more so since the Council's decision of 12 March involved a daily change in the rates of exchange as between the currencies of the Member States and the dollar.

Contracts entered into after 30 April 1973

35 Those applicants who entered into export contracts after 30 April 1973 could not have been unaware of Regulation No 1112/73 and the new method of calculating compensatory amounts.

36 Nothing in that Regulation justifies the assumption that in the implementing procedures there would be any transitional measure whatsoever in respect of contracts entered into before the date of application of the new method of calculating the amounts.

37 Since the applicants were free to take all such precautions as they thought fit in drawing up their sale contracts they cannot claim to have committed themselves in reliance on the former method of calculation continuing in respect of the exports contemplated.

The contracts entered into before 30 April 1973

The contract of 23 March 1973

43 In opting on 30 March 1973 in favour of the export of Community barley, by applying for a certificate of exceptional duration with advance fixing of the amount of the refund, the applicant, as a prudent exporter made a commercial choice based on the state of the market with all the risks inherent in such a choice.

44 Amongst the risks which could be foreseen on 30 March or at the latest on 20 April, this being the date of the issue of the certificate and a date on which it could still have withdrawn its application, there was the probability of a change in the method of calculating the compensatory amounts.

45 Even if it was not certain that the change suggested by the Commission would be adopted by the Council, it ought on those dates at least to have been clear to an experienced trader that the introduction of a new method of calculation was imminent.

46 The applicant cannot therefore invoke a legitimate expectation of the continuance of the former method of calculation.

The contracts of 28 and 29 March

47 By contract dated 28 March 1973 concluded in Moscow between a Soviet importer and a French exporter, the Groupement d'Intérêts Economiques

52 In any event, by 29 March the Commission's proposal had already been discussed by the Council and the change in the basic system of calculation of compensatory amounts was foreseeable, taking into account the circumstances already set forth.

53 Accordingly, it cannot be argued that the French agent who at that date negotiated the contract of 29 March 1973 did so in reliance on the continuance of the former method of calculation of compensatory amounts.

54 The fact that the contract was concluded on 29 March 1973 in relation to a

quantity of 500 000 metric tons, on a long term basis and expressed in dollars, at a time when the central banks of the Member states were no longer obliged to intervene in order to support that currency in fact involved a considerable commercial risk.

JUDGMENT OF 10. 12. 1975 — JOINED CASES 95 TO 98/74, 15 AND 100/75

55 In view of all these factors it cannot be argued that the applicants could at a time when they entered into the bargain have had a legitimate expectation of the continuance of the former system.

hereby:

(1) Dismisses the applications;

(2) Orders the applicants to pay the costs.

Kutscher Donner Mertens de Wilmars

Pescatore Sørensen Mackenzie Stuart O'Keeffe

Delivered in open court in Luxembourg on 10 December 1975.