C-6/77

JUDGMENT OF THE COURT 6 JULY 1977 <apnote>1</apnote>

N.G.J. Schouten B.V. v Hoofdproduktschap voor Akkerbouwprodukten (preliminary ruling requested by the College van Beroep voor het Bedrijfsleven)

Case 6/77

1. Agriculture — Common organization of the markets — Levy — Regulation No 120/67/EEC, Article 15 (2) — Interpretation — Criteria 2. Agriculture — Common organization of the markets — Aim 3. Agriculture — Common organization of the markets — Importation — Threshold price — Variation — Levy applicable on the day on which the application for the certificate is lodged — Increased by the amount of the premium — Adjustment (Regulation No 120/67/EEC of the Council, Article 15 (2))

JUDGMENT OF 6. 7. 1977 — CASE 6/77

on the interpretation of Article 15 of Regulation No 120/67/EEC of the Council of 13 June 1967 on the common organization of the market in cereals (OJ, English Special Edition 1967, p. 33),

THE COURT

composed of: H. Kutscher, President, A. M. Donner and P. Pescatore (Presidents of Chambers), J. Mertens de Wilmars, M. Sørensen, Lord Mackenzie Stuart, A. O'Keeffe, G. Bosco and A. Touffait, Judges,

Advocate General: J.-P. Warner Registrar: A. Van Houtte

gives the following

SCHOUTEN v HOOFDPRODUKTSCHAP VOOR AKKERBOUWPRODUKTEN

certificate. In this case a premium, fixed in the month of importation and then at the same time as the levy, shall be adding to that levy the premium laid added to the levy.' down in Article 2 of Regulation No 140/67. The general rules of this system were fixed by the Council in Regulation No Schouten objected that such a calculation 140/67/EEC (OJ, English Special Edition was not correct for, following a proper 1967, p. 91). This regulation essentially interpretation of the provisions contains rules concerning the 'premium . applicable, it was necessary first to apply the premium to the levy in force on the Under Articles 2 and 4 thereof: day on which the application for the Article 2 certificate was lodged and then to adjust that levy to the threshold price 'When, for one of the products listed in applicable in the month of importation. Article 1 (a) and (b) of Regulation No 120/67/EEC, the cif price is higher than The objection raised to that effect by the cif forward delivery price for the Schouten in its letters of 8 October 1974 same product, the rate of the premium and 20 August 1976 was dismissed by shall, subject to the provisions set out the H.v.A. by letter of 1 September 1976 below, be equal to the difference between and the case was brought before the the two prices'. College van Beroep voor het Bedrijfsleven (an administrative court for Article 4 economic matters) by an application 'If the cif price is equal to the cif forward lodged on 1 October 1976. delivery price or exceeds the latter by not The college van Beroep voor het more than 0-125 units of account per Bedrijfsleven, having regard to the metric ton, the premium shall be equal arguments put forward by the parties, to 0 units of account.' which were based principally on the The detailed rules for the application of interpretation of the abovementioned the system in force at the time of the provisions, considered that it was facts of the main action set out below are necessary for the purpose of giving those fixed by Regulation (EEC) No judgment in the case to refer the 2637/70 of the Commission (OJ, English following question to the Court of Special Edition 1970 (III), p. 932). Justice for a preliminary ruling:

4. A copy of the order for reference was Article 15 (2) of Regulation No 120/67 is received at the Court of Justice on 12 based on those principles. It follows from January 1977. that provision, in particular from the words 'at the same time', that the levy Schouten, represented by Messrs L. A. E. and the premium may not be fixed Briët and H. H. Kronenberg, and the independently of one another. The Commission of the European method to be followed is that which Communities, represented by its Legal consists in first adjusting, by the Adviser, J. H. J. Bourgeois, submitted premium, the levy applicable on the day written observations in accordance with on which the application for the Article 20 of the Protocol on the Statute certificate is lodged and then correcting of the Court of Justice of the EEC. that amount on the basis of the threshold

SCHOUTEN v HOOFDPRODUKTSCHAP VOOR AKKERBOUWPRODUKTEN

is: the application for the certificate is — variations in the threshold price, lodged, the result varies according to — 'premiums', which are linked to the whether one or the other method is used. fluctuations in world market prices. The levy to be charged is higher if the The variations in the threshold price levy applicable on the day on which the result first from the application of the application is lodged is first adjusted on monthly increases referred to in Article 6 the basis of the threshold price valid in (1) of Regulation No 120/67.

Under Article 15 (2) of Regulation No 120/67, the first of these methods must The premiums compensate for fluctu be applied. This follows from the very ations in world market prices by covering wording of that provision, which the differences between the cif price provides for two distinct operations to be carried out in a well-defined order: first, valid on the day on which the application for the import or export the adjustment of the levy on the basis of certificate is lodged and the cif forward the threshold price, and then the delivery price, where the latter is lower addition to the levy thus calculated of a

The account (Article 4 of Regulation No Community legislature adopted as its 140/67). starting point the levy in force on the day on which the application for the As long as the levy applicable on the day certificate was lodged. In so doing, it on which the application for the took into account however the fact that

the price level to be attained, and Although the method laid down in therefore to be protected on the date of Article 15 (2) of Regulation No 120/67 importation is not indicated by the leads, in cases such as the present, to a threshold price in force on the day on levy which is higher than the difference which the application for the certificate between the threshold price in force in is lodged but by that in force on the date the month of importation and the cif of importation: for this reason, it was forward delivery price, as determined for decided to adjust the levy to the that month, nevertheless the Commis­ threshold price valid during the month sion cannot merely because of that fact of importation. depart from the wording of Article 15 (2), which is clear in itself. Once this adjustment had been made, the problem arose on the other hand First, the calculation made on the basis whether it was necessary to add a of the cif forward delivery price valid for correcting factor to the amount thus the month of importation does not obtained in cases in which the cif price guarantee that that importation will is, during the month of importation, less always be made in practice at the than the cif price 'fixed in advance', that threshold price, since the cif price only is, less than the cif price used for the reflects the trend of the market in futures calculation of the levy fixed in advance. and other factors may give rise to In such cases, in fact, the levy fixed in importations at a price lower than the advance is inadequate because it is too threshold price. Secondly, it is necessary low. The 'premium' is precisely a to remember that advance fixing is not correcting factor designed for this obligatory but is a system which an purpose: it should increase the levy to be importer may or may not use according applied. to his own judgment: if in certain cases that system does not seem to him to be Such a method is also more in favourable, he has an alternative, that is, accordance with the very system of the system of the 'daily' levy. advance fixing in which a distinction is made between the levy properly so-called The Commission proposes that the and the premium. The application of question referred to the Court should be another method, such as that suggested answered as follows: by Schouten, does not take into account that distinction: in such cases, the 'Under the provisions of Article 15 (2) of adjustment of the levy to the (lower) Regulation No 120/67, a variation in the threshold price may be of negative value threshold price valid in the month of which, although it does not lead to an importation leads to an adjustment of the import subsidy, means however a levy fixed in advance alone and in no reduction in or cancellation of the way affects the premium referred to in premium. Nor does the system of those provisions.' premiums, as laid down in Regulation No 140/67, include negative values for premiums either except where the levy III — Oral procedure fixed in advance must be increased or remain unaltered (Article 4); there is no Schouten and the Commission of the

3 This question has arisen in the context of a dispute between a Netherlands maize importer and the Hoofdproduktschap voor Akkerbouwprodukten concerning the calculation of the levy fixed in advance, referred to in Article 15 (2) of Regulation No 120/67, for maize imported into the Netherlands in August 1974 on the basis of import certificates fixing the levy in advance.

4 Unter the abovementioned Article 15 (2), as amended by Regulation (EEC) No 2429/72 of the Council of 21 November 1972 (OJ, English Special Edition 1972 (November), p. 48), for certain products, including maize, the 'levy applicable on the day on which the application for the certificate is lodged, adjusted on the basis of the threshold price valid in the month of importation, shall be applied, if the party concerned so requests at the same time as the application for the certificate is made (the requests to be made not later than 13.00 hours), to imports effected during the period of validity of the certificate. In this case a premium, fixed at the same time as the levy, shall be added to the levy'.

5 The file shows that in the present case the national collection agency interpreted that provision as meaning that the levy applicable on the day on

JUDGMENT OF 6. 7. 1977 — CASE 6/77

which the application for the certificate is lodged must first be adjusted on the basis of the threshold price valid on the date of importation and then increased by the unadjusted amount of the premium introduced by Regulation No 140/67 of the Council (OJ, English Special Edition 1967, p. 91).

6 Since the calculation of the amount of the levy according to those rules produced a negative value, the collection agency brought that amount to 0 units of account and added the premium thereto.

SCHOUTEN v HOOFDPRODUKTSCHAP VOOR AKKERBOUWPRODUKTEN

preamble to Regulation No 140/67 of the Council according to which 'the common threshold price is the Community market's sole protection'.

12 In view of its objective and the function which it fulfils within the system of levies, it is therefore impossible for the correcting factor of the premium to be applied so as to increase the levy fixed in advance beyond what is necessary to cover the difference between the prices ruling outside and within the Community.

13 In a case such as that referred to by the order for reference, the application of that correcting factor after the levy has been adjusted on the basis of the threshold price valid in the month of importation leads to an increased charge, which is unjustified having regard to the objectives of the levy, and to importations at a level higher than the threshold price, which is incompatible with the principles of the common agricultural policy.

H On the other hand, such results are avoided if the premium is applied before the levy is adjusted on the basis of the threshold price valid in the month of importation.

15 It follows moreover from Regulation No 140/67 that the fixing of a premium is linked solely to the variations in the cif price and does not take into account any variations in the threshold price.

21 For those reasons, it is necessary to reply that Article 15 (2) of Regulation No 120/67/EEC of the Council must be interpreted as meaning that a variation in the threshold price valid in the month of importation into the Community leads to an adjustment of the levy applicable on the day on which the application for the certificate is lodged, as increased by the amount of the premium.

Costs

22 The costs incurred by the Commission of the European Communities, which submitted observations to the Court, are not recoverable.

23 Since the procedure is, so far as the parties to the main action are concerned, in the nature of a step in the proceedings before the national court, it is for that court to make an order as to costs.

On those grounds,

THE COURT

Delivered in open court in Luxembourg on 6 July 1977.

A. Van Houtte H. Kutscher

Registrar President

OPINION OF MR ADVOCATE-GENERAL WARNER

DELIVERED ON 15 JUNE 1977

My Lords, proceedings is the 'Hoofdproduktschap voor Akkerbouwprodukten' (Central This case comes to the Court by way of a Board for Agricultural Products), which is reference for a preliminary ruling by the the agency responsible in the College van Beroep voor het Netherlands for the administration of the Bedrijfsleven. It raises a somewhat levies. abstruse question of interpretation of Council Regulation No 120/67/EEC of Your Lordships remember that, by the 13 June 1967, which, Your Lordships combined effect of Articles 2 and 5 of remember, established the common Regulation No 120/67, the Council was organization of the market in cereals, and required to fix each year, in anticipation which remained in force (subject to of the next marketing year, target prices, amendments made from time to time) basic intervention prices and threshold until 1 November 1975, when it was prices for the main cereals covered by superseded by a consolidating the Regulation, including maize. The Regulation, Council Regulation (EEC) target price for a cereal was the price that No 2727/75 of 29 October 1975. it was desired that it should fetch on the Community wholesale market (actually at The question is as to the correct method Duisburg), whilst the threshold price was of computation of the levies payable on the minimum price at which it was importations of maize from outside the estimated that imports of that cereal Community effected in August 1974 by must enter the Community (at N. G. J. Schouten B. V. (which I shall call Rotterdam) in order not to fetch less than 'Schouten'). Schouten is the plaintiff in the target price. The Regulation also the proceedings before the College van provided, by Article 6, that the target Beroep. The defendant in those prices, intervention prices and threshold