C-146/77

JUDGMENT OF THE COURT OF 13 JUNE 1978

British Beef Company Limited v Intervention Board for Agricultural Produce (preliminary ruling requested by the High Court of Justice, Queen's Bench Division, Commercial Court)

"Monetary compensatory amounts"

Case 146/77

1. Agriculture — Monetary compensatory amounts — Right to grant or duty of payment

thereof — Creation — Rules applicable

by the performance of the import or 2. Having regard to the recitals to and the provisions of Regulation No export transaction as the case may be from 2405/76 and to the special circum­ and only the moment when

It stances existing at the time of its that transaction takes place.

follows that in the absence of an adoption it could not arouse in the

to the the minds of persons concerned a express provision contrary amounts to be paid or levied are legitimate expectation, which the

those fixed by the rules in force at Commission was required to protect, the moment of the import or export of its maintenance for the whole of

whatever may be the date on which the week in question.

and

Intervention BOARD for Agricultural Produce

on the interpretation and validity of Commission Regulation (EEC) No 2424/76 October 1976 altering the monetary compensatory amounts of 5 (Official Journal L 275, p. 1),

THE COURT,

composed of: H. Kutscher, President, M. Sørensen and G. Bosco (Presidents Chambers), A. M. Donner, J. Mertens de Wilmars, of

P. Pescatore, Lord Mackenzie Stuart, A. O'Keeffe and A. Touffait, Judges,

already at 20 of the Protocol on the Statute of the a high level. Because the Commission Court of Justice of the EEC may be found this situation unsatisfactory it summarized as follows: proposed to the Council the adoption of

a regulation for a devaluation of the

representative rate for the pound

I — Facts and procedure sterling (document COM (76)531 final of 4 October 1976). This regulation was

1. From the middle of September 1976 intended to enter into force on 11

onwards the British pound lost value as October 1976. While waiting for the "snake" against the currencies. Council to decide on its proposal the

from the previous week the level of the regulation does not apply to exports

MCAs for the pound sterling and the made by it in execution of contracts

Irish pound. entered into force before the promul­

gation of the regulation. Alternatively it The fourth recital to this regulation submits that the regulation is invalid in indicated that: far it so as purports to apply to the

aforesaid exports and that the ... "in view of the developments in the Intervention Board is not entitled to exchange rates of the pound, and implement the same in respect of the pending an urgent decision on the said exports. matter by the Council, it is appropriate to maintain, as a precautionary measure, the monetary amounts fixed 4. Before deciding further, the High with effect from 27 September 1976 for Court of Justice by order of 15 the two currencies in question."

November 1977 stayed the proceedings

grounds or on any of them the 2. British Beef Company Ltd (herein­ aforesaid regulation is invalid in so after referred to as "British Beef"), the far it as purports to apply to such plaintiff in the main action, carries on exports."

the export of beef from the United Kingdom to other Member States. 5. The order of the High Court of

The Intervention Board for Agricultural Justice was received at the Court

Produce, the defendant in the main Registry on 2 December 1977. action, is the agency in the United In accordance with Article 20 of the Kingdom responsible for the carrying Statute of the Court of Justice of the out of operations and arrangements of EEC written observations were the common agricultural of the policy community. submitted by the parties to the main

action and the Commission of the

European Communities. 3. As the level of MCAs which it had to pay on its exports had been increased The Court, on hearing the report of the

British Beef Company Ltd, the judgment of the Court of 14 May 1975 plaintiff in the main action in CNTA v Commission (Case 74/74 [1975] ECR 533). British Beef explains that the standard

procedure in the trade in question is Initially British Beef makes three

that, for shipments of meat to be made comments on the above rule: first, that at the end of each traders start there was in the present case no week, making contracts from the middle of the overriding matter of public interest; British secondly, that while the formulation in previous week. According to

Beef it is essential for all traders in that the CNTA case was expressed in the

market to be able to rely upon short- context of the abolition of MCAs, the

term force casts concerning levels of rule applies equally to their alteration; MCAs when into contracts, thirdly, that the Court has, in its entering since the prices are based upon the rates judgments of 15 December 1977 and 8

MLC telex of 29 September 1976. A paragraphs 30, 35 to 37, 44 to 46 and 52 55 7 1976 in further telex dated Tuesday 5 October to and that of July 1976 stated that "it is understood that IRCA v Amministrazione delle Finanze there is to be no devaluation of UK dello Stato (Case 7/76 [1976] ECR 'Freezing' green pound ... of MCAs 1213) as well as the above-mentioned

will not after this week."

Merkur and Dietz cases (97/76 and apply Nevertheless the Commission on the 126/76 respectively). The claims which

day Regulation No failed in those cases did so, in British very same adopted

2424/76. Beef's submission, because it was held that the claimants could have foreseen According to British Beef the the effects of the legislation. Commission acts unlawfully if, in the

absence of an overriding matter of British Beef further alleges that it public interest, it abolishes or alters with follows from the above-mentioned

such was enacted only on Friday 1 October and because, although British Beef was B — Written observations submitted by notified by telex of the operative part of the the Intervention Board for Agri­ regulation, the preamble would only have been at the cultural Produce, the defendant in available, earliest, when the published in the main action regulation was

the Official Journal on Monday 4

October, when the contracts concerned The Intervention Board submits

had already been concluded. concerning the first preliminary question that upon a correct interpret­ British Beef further submits that the ation of Regulation No 2424/76 the preamble cannot be so construed as to new rates concerning beef prescribed in give any warning of a change in MCAs. the annex to that regulation apply to all On the contrary, since the preamble exports effected as from 6 October 1976 expressly affirms that it is appropriate to irrespective of the dates of the contracts maintain the MCAs at their existing in execution of which the exports were levels, the natural inference is that they made. would not be altered in the immediate future. Nor does As the sense affected by to the second question, the

the use of the words "pending an Intervention Board states that faced Council" urgent decision of the give a with a regulation duly published, valid

warning of change in MCAs. The only on the face of it, and directly applicable decision of the Council to be expected in the United Kingdom, it was bound to in that context was a decision to enforce it. It was under no duty to "green" devalue the pound sterling. inquire into any of the matters alleged

foreseeable in respect of the contracts The Commission submits that on a relevant here. literal interpretation Regulation No Accordingly for the reasons set out 2424/76 is applicable to exports of agri­

above British Beef submits that the cultural products from the United questions referred to the Court should Kingdom effected on or after 6 October be answered as follows: 1976.

JUDGMENT OF 13. 6. 1978 — CASE 146­/77

As to the principle of the need to However, for exporters the

protect legitimate expectation the Commission, through a desire to avoid

Commission refers to the definition a formal back-dating of the regulation, given by the Advocate General in his abstained from fixing the amounts from opinion delivered on 12 November 1975 the beginning of the week. in the Cooperatives Agricoles de Céréales The amounts fixed by Regulation No cases (Joined Cases 95 to 98/74, 19 and 2424/76 were — in the Commission's 100/75 [1975] ECR at page 1643 in submission —

difference between the representative no grounds advanced by British Beef rate of a currency and its real value on which should lead the Court "exceptionally" the exchange markets over a given to recognize their claim "exemption" period. Only in exceptional circum­ for of exports made under

stances following the management certain contracts from the normal

committee procedure does the application of Regulation No 2424/76. Commission feel required to depart The Court is extremely prudent about "exemption" from this rule — for example where, as recognizing such an (see in the case of Regulation No 2405/76, judgment in Case 126/76, Dietz v

it anticipates an event during the course Commission). Moreover the system of

of the week which would require the re­ MCAs is designed to allow the

establishment of the previous amounts. Common Market to function properly in time of monetary instability, rather It is true that in practice the than to protect the individual interests Commission fixes amounts which are of traders. valid for a whole week. In the

for the whole week 4 to 10 October for to the Commission that British Beef those importers who would have an should have based its action in the

interest in the application of such rules. national court.

BRITISH BEEF COMPANY v INTERVENTION BOARD FOR AGRICULTURAL PRODUCE

In conclusion the Commission proposes III — Oral procedure to the Court the following answers to At the hearing on 20 April 1978 the the questions submitted by the High plaintiff in the main action, represented Court of Justice: by F. Jacobs, the defendant in the main Langdon- action, represented by P. G.

"(1) Regulation (EEC) No 2424/76 Davies, and the Commission, represented by its Legal Adviser, R. applies to exports effected during Wainwright, acting as Agent, submitted the period 6 to 10 October 1976 in oral argument. execution of contracts concluded The defendant in the main action stated prior to the date on which it was in reply to a question from the

promulgated. Advocate General that the Meat and

monetary compensatory amounts (Official Journal L 275, p. 1).

2 These questions were raised in the course of an action between a United Kingdom trader carrying out the export of beef to other Member States, the plaintiff in the main action, and the British Intervention Board for Agri­

cultural Produce, the defendant in the main action, regarding the levying of monetary compensatory amounts fixed by Regulation No 2424/76 on the occasion of the execution of export contracts concluded before the entry into force of the regulation.

3 In spite of the trend noted in the exchange rate pound sterling the of the

Commission, by Regulation (EEC) No 2405/76 of October 1976 altering 1 the monetary compensatory amounts (Official Journal L 271, p. 1), which entered into force on Monday 4 October 1976, maintained unchanged for the United Kingdom the amounts fixed for the previous week.

JUDGMENT OF 13. 6. 1971 — CASE 146/77

them to the decline in value of the pound.

The first question

6 The first question inquires whether Regulation No 2424/76 must be interpreted as meaning that it did not apply to exports effected in execution

of contracts concluded prior to the date on which it was promulgated.

7 It should be noted on this subject that the actual right to receive a monetary

compensatory amount and the charge resulting from the levying of such an amount are only created by the performance of the import or export

10 The answer to be given to the first question should therefore be that Regu­ lation No 2424/76 was applicable to exports effected in execution of

contracts concluded prior to the date of its promulgation.

COMPANY

BRITISH BEEF v INTERVENTION BOARD FOR AGRICULTURAL PRODUCE

Second question

11 In the second question the Court is asked whether Regulation No 2424/76 is valid in so far as it purports to apply to exports effected in execution of

expectation, which the Commission was required to protect, of its main­

tenance for the whole of the week in question.

14 Indeed it may be seen from the statement of the grounds on which the regu­

lation was based that it had been adopted precautionary as a measure and

pending an urgent decision on the matter by the Council.

15 The persons concerned could not be unaware of the uncertainties which

17 The reply should therefore be that consideration of the question raised has disclosed no factor of such a kind as to affect the validity of Regulation No 2424/77.

JUDGMENT OF 13. 6. 1978 — CASE 146/77

Costs

18 The costs incurred by the Commission of the European Communities which has submitted its observations to the Court are not reimbursable.

19 As these proceedings are, in so far as the parties to the main action are

concerned, in the nature of a step in the action pending before the national

prior to the date of its promulgation.

2. Consideration of the question raised has disclosed no factor of such a kind as to affect the validity of that regulation.

Kutscher Sørensen Bosco Donner Mertens de Wilmars

Pescatore Mackenzie Stuart O'Keeffe Touffait

Delivered in open court in Luxembourg on 13 June 1978.

A. Van Houtte H. Kutscher