C-94/75

1. Although Article 1 (2) of Regulation sugar year are to be excluded when No 142/69 of the Commission does the quantity of sugar referred to in not expressly mention sugar Article 1 (1) of Regulation No 142/69 sweepings, both logic and equity lead of the Commission is being nevertheless to the conclusion that calculated. they must be deducted from the For this purpose sugar sweepings from production mentioned in paragraph a previous sugar year are to be (1) of the article. expressed as white sugar in proportion 2. Quantities of white sugar produced to the sucrose content from sugar sweepings from a previous

In Case 94/75,

reference to the Court under Article 177 of the EEC Treaty by the Finanzgericht Baden-Württemberg for a preliminary ruling in the action pending before that court between

SUDDEUTSCHE ZUCKER-AKTIENGESELLSCHAFT, Mannheim

and

HAUPTZOLLAMT MANNHEIM,

gives the following

JUDGMENT

Facts

The facts of the case, the procedure and the deductible item of sugar sweepings in the observations submitted under Article respect of the 1968/69, 1969/70, 1970/71 20 of the Protocol on the Statute of the and 1972/73 sugar marketing years. Court of Justice of the EEC may be summarized as follows: The objection lodged against that notice of assessment not having been successful, Süddeutsche Zucker-Aktiengesellschaft I — Facts and procedure brought an action before the Finanz­ gericht Baden-Württemberg. Under Regulation No 1009/67/EEC of the Council of 18 December 1967 on the In the course of the proceedings in that common organization of the market in court the plaintiff claimed that it was not sugar (OJ No 308 of 18. 12. 1967, p. 1; necessary to treat processed sugar English Special Edition 1967, p. 304) the sweepings as raw sugar within the Hauptzollamt Mannheim issued the meaning of Article 1 (2) of Regulation undertaking Süddeutsche Zucker-Aktien­ (EEC) No 142/69 of the Commission gesellschaft on 6 November 1974 with a and consequently to impose the notice of assessment to production levy production levy on the quantity of sugar in the sum of DM 51 380.73. The ground corresponding to the 0.6 % refining loss put forward in the notice of assessment, in disregard of the fact that this quantity as to DM 38 538.55 was that a refining was neither produced nor sold. Sugar loss rate of 0.6 % had to be applied to sweepings arise from the production of

SUDDEUTSCHE ZUCKER v HAUPTZOLLAMT MANNHEIM

earlier years and consequently cannot be The order of the Finanzgericht was liable to the production levy twice. registered at the Court on 3 September 1975.

By order of 22 May 1975, the Finanz­ Süddeutsche Zucker-Aktiengesellschaft gericht Baden-Württemberg (Second refers to its arguments set out before the Senate) stayed the proceedings and Finanzgericht. referred the following questions to the The Hauptzollamt Mannheim considers Court of Justice of the European that the solution of the problem follows Communities in accordance with Article from the purpose of the provisions 177 of the EEC Treaty for a preliminary concerning the production levy ruling: applicable in the present case. 1. Does sugar production within the meaning of Regulation (EEC) No By the establishment of a production 142/69, especially Article 1 (1) thereof, levy on sugar produced outside the basic also include the production of white quota, but within the maximum quota, sugar from sugar sweepings on which producers must themselves assume the production levy has already been financial responsibility for the disposal of imposed in accordance with Article surplus sugar. The only fact which 27 of Regulation No 1009/67/EEC in matters for the purpose of the collection a previous sugar marketing year? of this levy is consequently the 2. If the first question is answered in the ascertainment of the quantity of sugar affirmative: Does Article 1 (2) of actually produced. Regulation (EEC) No 142/69 whereby The total quantity of sugar, for the certain products are excluded when purpose of assessing the quantity of sugar the quantity referred to in paragraph produced during a sugar year, was (1) of that article is being calculated determined first on the basis of Article 3 also cover sugar sweepings? (1) of Regulation (EEC) No 142/69 under 3. If the first and second questions are which sugar production for the purpose answered in the affirmative: When the of the levy, means the quantity of sugar quantity which is not to be taken into 'actually manufactured'. To the extent to consideration within the meaning of which sugar sweepings produced during Article 1 (2) of Regulation (EEC) No a previous year were added to the 142/69 is being determined, must production process, there were excluded reference be made to the quantity of from the calculation, in accordance with sugar sweepings or to the quantity of Article 1 (2) of Regulation No 142/69, white sugar which has been produced the quantities of white sugar produced from the sugar sweepings? from those sugar sweepings.

It is only from the quantity of sugar procedure adopted in the Federal sweepings, less the dirt and the refining Republic of Germany until 15 March loss caused inevitably by processing, that 1973. The new rules however cannot be the amount of white sugar can be understood as meaning that they also calculated and it is therefore that exclude, in respect of the past, the quantity which was subtracted from the application of the more precise method quantity produced in a later year. of calculating the quantity of sugar actually manufactured. That method of calculation is in accordance with Regulation No The determination of the quantity of 1009/67/EEC and with Regulation (EEC) sugar produced before the entry into No 142/69 since it allows the quantity of force of the new regulation was made sugar actually manufactured to be exclusively in accordance with the established. provisions of Regulation No 1009/ 67/EEC and of Regulation No 142/69. If, on the other hand, account is not taken of refining losses, the production In the absence of any indication allowing of sugar during a later year is reduced by the application of rules of a a greater quantity than that actually comprehensive nature such as those caused by the processing of the sugar introduced later, the said regulations sweepings from a previous year. In these permitted the application of the more circumstances the quantity of sugar precise procedure put into practice in the actually manufactured is altered with the Federal Republic of Germany. result that no production levy is charged on a quantity of sugar manufactured As to the first two questions, the during a later year to the extent of the Commission states that the provisions refining loss on the sugar sweepings. concerning the calculation of the sugar production of an undertaking and, This last method cannot be based either consequently, of the levy on production, upon Regulation (EEC) No 700/73 of the must be regarded only from the point of Commission of 12 March 1973 (OJ L 67 view of the quota system. This system of 14. 3. 1973, p. 12) which replaces the consists of a series of measures for regulation applicable in the present case. planning production, for the application of which reference is made to the actual

transport, packaging, cutting etc., require calculation of the quantities produced refining once more if they are to be which are not to be taken into account, it re-used. If, as is most often the case, the was necessary to take as a basis, within re-refining is carried out during the the framework of Regulation No 142/69, following sugar year, then from the the original quantities of sugar purely technical point of view, such sweepings, taking account of their production must be included in the sugar sucrose content expressed as white sugar. production of that year within the The problem of refining loss, a question meaning of Article 1 (1) of Regulation of small economic importance, was No 142/69. raised only at the time of the drafting of Regulation No 700/73.

There of Regulation No 142/69. occurs here also — during the refining The problem raised in the present case process — a certain loss called 'refining arises only because the sugar sweepings loss'. As the quota system is based on the of one particular sugar year were total quantities of sugar expressed as included a priori — as white sugar — in white sugar, it is logical that this loss the production of that same sugar year. should have an effect upon the The Community rules are actually based determination of the quantities deductible; otherwise the manufacturer on the concept which regards production as being a process. of white sugar using raw sugar as a basic material would be at an advantage as It is necessary in any case to accept that compared with the manufacturer the production of white sugar for a producing white sugar directly from the particular sugar year, as finally calculated raw material.

1 By an order of 22 May 1975, received at the Court Registry on the following 3 September, the Finanzgericht Baden-Württemberg, under Article 177 of the EEC Treaty, referred to the Court three questions on the interpretation of Regulation (EEC) No 142/69 of the Commission of 25 January 1969, laying down certain detailed rules for the application of the quota system for sugar (OJ L 20/1969, p. 1).

These questions were raised in proceedings relative to the collection of the production levy provided for in Article 27 or Regulation No 1009/67/EEC of the Council of 18 December 1967 on the common organization of the market in sugar (OJ No 308/1967, p. 1), which subjects the quantity of sugar produced outside the basic quota of the manufacturers in question to such a levy.

2 Under the terms of Article 1 (1) of Regulation No 142/69 'sugar production' for the purposes of Article 27 of Regulation No 1009/67/EEC means the total quantity, expressed as white sugar, of: white sugar, raw sugar, invert sugar and the syrups mentioned therein.

SÜDDEUTSCHE ZUCKER v HAUPTZOLLAMT MANNHEIM

Under paragraph (2) of the same article certain quantities are to be excluded when the quantity referred to in paragraph (1) is being calculated, the particular intention being the avoidance of a double levy.

3 The sugar manufacturer, the plaintiff in the main action, disputes the calculation of the levy demanded in so far as it refers to the sugar produced from sugar sweepings, that is to say, from sugar produced previously, but which remains after the operations of packaging and dispatch in the factory, and which is revovered by sweeping, but which must because it is dirty be refined again.

5 Although Article 1 (2) of Regulation No 142/69 does not expressly mention sugar sweepings, both logic and equity lead nevertheless to the conclusion that they must be deducted from the production mentioned in paragraph (1) of the article.

JUDGMENT OF 5. 2. 1976 — CASE 94/75

The objective of the regulation being to fix exactly the quantities produced outside the, quota and which for this reason are subject to the production levy provided for in Article 27 of Regulation No 1009/67/EEC sugar sweepings should be deducted from these quantities which have already been subject to such levy at the time of their first refining.

For the same reason account should be taken of the quantity of sugar which at the first refining was regarded as being part of the production, but which because of its origin has not been disposed of on the market.

These conclusions are confirmed moreover by the wording of Regulation No 700/73 of the Commission of 12 March 1973 (OJ L 67/1973, p. 12) which replaced Regulation No 142/69 and Article 1 (2) of which lays down that there shall be excluded, when the quantity referred to in paragraph (1) is being calculated, quantities of white sugar produced from sugar sweepings, and whilst Article 1 (4) lays down that sugar sweepings from a previous sugar year shall be expressed as white sugar in proportion to the sucrose content.

It is therefore appropriate to reply to the effect that Article 1 of Regulation No 142/69 must be interpreted in this sense.

Quantities of white sugar produced from sugar sweepings from a previous sugar year are to be excluded when the quantity of sugar

SÜDDEUTSCHE ZUCKER v HAUPTZOLLAMT MANNHEIM

referred to in Article 1 (1) of Regulation No 142/69 of the Commission is being calculated.

For this purpose sugar sweepings from a previous sugar year are to be expressed as white sugar in proportion to the sucrose content.

Lecourt Kutscher Donner

Mertens de Wilmars Sørensen Mackenzie Stuart O'Keeffe