C-6/78

JUDGMENT OF THE COURT OF 11 JULY 1978<appnote>1</appnote>

Union Française de Céréales v Hauptzollamt Hamburg-Jonas (preliminary ruling requested by the Finanzgericht Hamburg)

"Accession compensatory amounts"

Case 6/78

1. Agriculture — Trade between new Member States and the original Community — "Accession" compensatory amounts — Purpose — Community preference (Act ofAccession, Art 55)

2. Agriculture — Goods exported from one of the original Member States to a new Member State — Destruction in transit — Force majeure — "Accession" compensatory amounts — Grant — Exporter's entitlement — Analogy with the rule on export refunds (Regulation No 269/73 of the Commission, Art. 5 (2); Regulation No 192/75 of the Commission, Art. 6 (1))

and

Hauptzollamt (Principal Customs Office) Hamburg-Jonas, Hamburg,

on the interpretation of Article 5 (2) of Regulation (EEC) No 269/73 of the Commission of 31 January 1973 laying down detailed rules for the application of the system of "accession" compensatory amounts (Official Journal L 30 of 1 February 1973, p. 73),

THE COURT

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

Advocate General: F. Capotorti Registrar: A. Van Houtte

for the application of the system of imported into a third country and where "accession" compensatory amounts appropriate into a specific third (Official Journal L 30 of 1 February country: . . .". 1973, p. 73) laid down general rules and Under Article 11 (1) of Regulation No application provisions for "accession" 192/75: compensatory amounts applicable to "Where the rate of refund varies cereals. The first paragraph of Article 9 of Regulation No 229/73 provides that: according to destination, payment of the refund shall, subject to the "Detailed rules for granting, levying provisions of paragraph 2, be made only and recovering compensatory amounts if the product has been imported into shall be such as to avoid possible the third country or countries in respect deflections of trade and distortions of of which the refund is prescribed".

the geographical territory of the Member State in which the formalities applied to the defendant in the main were completed". action for the payment of "accession" compensatory amounts on the basis of Article 5 (2) of that regulation provides the rate fixed in advance. The defendant that where the compensatory amount refused to make the said payment has to be adjusted for the amount of because U.F_C_ had not provided the customs dudes, or where it is higher proof of importation into the United than the expon refund applicable on the Kingdom required by Article 5 (2) of day of exportation, compensatory Regulation No 269/73. U.F_C_ brought amounts shall be paid an action against this refusal before "only upon proof that, further, impon the Finanzgericht (Finance Court) formalities have been completed and Hamburg. duties and taxes of equivalent effect payable in the Member Sute of 4. By an order of 14 December 1977, destination have been collected". the Finanzgericht stayed the proceedings and referred the following

provides that: No 192/75 of the Commission of "In the following circumstances 17 January 1975, to be interpreted payment of the refund shall be as meaning that a compensatory conditional not only on the product amount is to be paid even if the having left the geographical territory of product in respect of which customs the Community but also — save where export formalities have been it has perished in transit as a result of completed, having left the geo force majeure — on its having been graphical territory of the Member

Sute in which the formalities were II — Submissions and argu­ completed, has perished in transit as ments of the parties a result of force majeure? 1. (a) U.F.C. submits that the first 2. In the event of Question 1 being answered in the affirmative, what is question referred for a preliminary the compensatory amount that has ruling should be answered in the affirm­ ative. to be paid: A provision must be applied by analogy (a) the compensatory amount laid down for the country of to another case which is not governed destination, or by the same rules if it is obvious that the legislature has forgotten to deal with (b) the lowest compensatory the second case in the same way as it amount, or dealt with the first one or if the difference in treatment results in an (c) the lowest refund?" infringement of the principle of It appears from the order making the equality. reference that the Finanzgericht favours If the introduction of export refunds an interpretation by analogy. and that of "accession" compensatory Regarding the calculation of the amounts are compared, it is found that "accession" compensatory amounts, the the purport and aim is the same in both Finanzgericht considers that an identical cases: export refunds are paid in order solution must be applied, whatever the to compensate the differences between interpretation of the provisions on lower prices on the world market and export refunds. In the Finanzgericht's higher prices within the Common judgment, for the purposes of equality Market (Article 16 of Regulation (EEC) of treatment it would also be No 2727/75 of the Council, Official Journal L 281, p. 1; first recital in the conceivable to arrange for a person preamble to Regulation (EEC) No entitled to the compensatory amount 2746/75 of the Council, Official when the lowest rate of refund is higher Journal L 281, p. 78); "accession" than the lowest compensatory amount to receive at least that amount and also compensatory amounts are paid in order to compensate among other things the for such person not to receive more differences between lower prices in the than a person entitled to the refund when the lowest rate of refund is lower new Member States and higher prices within the Community as originally than the lowest compensatory amount. constituted (Article 55 of the Act of Accession; the recitals in the preamble 5. The order making the reference was to Regulation No 2757/75 of the registered at the Court on 11 January 1978. Council, Official Journal L 281, p. 104 — for cereals). Written observations under Article 20 of U.F.C. then observes that Article 5 of the Protocol on the Statute of the Court Regulation No 269/73 provided for the of Justice of the EEC were submitted by first time for proof that the goods had U.F.C. and by the Commission of the reached the country of destination; European Communities. Regulation No 192/75, which was After hearing the report of the Judge- adopted two years later, repeated those Rapporteur and the views of the rules with regard to exports to third Advocate General, the Court decided to countries and added the exception of open the oral procedure without any force majeure to them. The objective of preparatory inquiry. the rules if identical in both cases,

namely to prevent abuses (fourth recital insurance company with which U.F_C_ in the preamble to Regulation No had concluded a contraa in favour of 269/73 and sixth recital in the preamble the British purchaser paid the purchaser to Regulation No 192/75). Since the as compensation the c.i.f. price plus 2 % two provisions had similar objectives but estimated profit. were adopted at different times, it may At the time the lowest "accession" be inferred that the Commission compensatory amount was one sixth of omitted to insert in the earlier regu the "accession" compensatory amount lation a provision on the exception of applicable to the United Kingdom force majeure corresponding to Article 6 (Regulation No 3096/75 of the of Regulation No 192/75. Commission, Official Journal L 309, In answering the first question it should p. 9). The lowest rate of the export also be borne in mind that the concept refund was nil (Regulation No 3301/75 of force majeure is one of the general of the Commission, Official Journal L principles of Community law. In that 327, p. 27), in the aim of preventing connexion, U.F_C_ points out that the exports to certain third countries. exception of force majeure appears in In that situation, the only justified several Community provisions where course is to grant the compensatory individuals are to be protected from the amount laid down for the country of consequences of having been unable destination of the goods at issue, through no fault of their own to fulfil namely the United Kingdom. an obligation imposed on them.

This view examined the question of fault in is mistakenly based on Article 11 of connexion with the failure to comply Regulation No 192/75. As Article 11 with the limitation period. Since Article (1) refers to Article 11 (2), which in its 3 of Regulation No 602/68 of the turn emphasizes that the rules on the Commission (Journal Officiel L 114, p. lowest refund concerning third 13), which was referred to in that case, countries apply "without prejudice to did not make express provision for the the provisions of Article 6", and since exception of force majeure, it must be Article 6 makes provision for force accepted that the Court includes that majeure, those rules should not apply concept among the general principles of where the goods have perished in transit law. as a result of force majeure.

Leith). The to prevent wrongful claiming of the

higher refund it is sufficient to produce amount or refund were paid, every by means of documents relating to the vendor would have to calculate a higher sale, shipping documents or by other price from the outset and then the means certain proof of the transpor goods would no longer be competitive. tation of the goods to the country of destination in which the refund is 2. The Commission emphasizes that higher. Article 5 of Regulation No 269/73 Since it is a matter of the payment of an governs only the way in which the "accession" compensatory amount in plaintiff in the main action must prove a respect of goods which have perished, right when the law treats him as having no other inference can be drawn from such a right. As to whether a right the grounds stated above. It is could be granted in this case, that issue unjustified and unfair to grant in respect can be resolved only through an analysis of the goods at issue only the lowest of the wording, the logic and the aim of all the provisions relating to "accession" "accession" compensatory amount, that compensatory amounts.

The refund in force in respect of Ireland. wording and the logic of the legislation To adopt any other solution than the on "accession" compensatory amounts one proposed above by U.F_C_ or to reflect that objective. That legislation refuse the "accession" compensatory treats exportation and importation as a amount in the case of accidental loss necessarily single and indivisible process. would force those concerned to insure In support of its opinion, the goods in transit at the higher price of Commission refers inter alia to Articles the exporting Member State and to pay 5 (2) and (3) of the Act of Accession, 3 a correspondingly higher premium, and 8 (1) to (4) of Regulation No which would have the effect of a charge 269/73, 4 of Regulation No 181/73 of having an effen equivalent to a customs the Council (Official Journal L 25, p. 9) duty. and to 2 and 5 of Regulation No 3280/73 of the Commission (Official Finally, payment of an amount less than the "accession" compensatory amount Journal L 337, p. 11). provided for the country of destination Having regard to the situation set out could appear as an infringement of above, it is not because of a legal lacuna Article 39 (1) (a) to (c) of the Treaty. If but rather because of the nature and a lower "accession" compensatory purpose of compensatory amounts that

a right to them cannot be held to exist compensatory amounts by way of in the present case. In these circum analogy with the right to expon stances, even a restrictive interpretation refunds: they are independent instru of the rules on proof in Article 5 (2) ments having different legal foun of Regulation No 269/73 is of no dations, objectives and ambit. If advantage to U.F_C_ analogies have to be accepted in such The Commission then considers cases, the freedom of the legislature in whether U.F_C_ is not entitled to the the field of economic policy would be unacceptably reduced.

Moulins et Huileries de No 229/73, whereby detailed rules for Pont-à-Mousson v Office National Inter granting compensatory amounts were to professionnel des Céréréales and Société be such as to avoid any distortion of Co-operative "Providence Agricole de la competition. In fact competition in the Champagne" v Office National Inter market of the Member State of professionnel des Céréales [1977] ECR destination is not distorted to the 1795.

Since the Commission would right to refunds shows that in this not have paid "accession" compensatory instance it is also impossible to base a amounts to the competitors of U.F_C_ in right to "accession" compensatory similar circumstance, U.F_C_ is not therefore the victim of discrimination. amounts on application by analogy of Article 6 of Regulation No 192/75. On the issue of force majeure the Since "accession" compensatory Commission points out that the amounts were to provide a means of objective of "accession" compensatory overcoming the obstacles imposed by amounts is not to insure the plaintiff in the common price policy on the entry of the main action against the risk of products from the exporting Member purely accidental loss of its goods in Sute into the market of the Member transit where the Commission did not Sute of destination, those amounts can bring about and could not have only by compared with export refunds prevented the said loss. Such losses are varied according to the country of a normal commercial risk which the destination, that is to say amounts undertaking must bear itself. This which are designed in particular to follows from the judgment of the Court bring the price of Community products of 14 February 1978 in Case 68/77, IFG in the country of destination to the level v Commission. of the prices prevailing in that country, The Commission cannot admit the and not with amounts which are existence of a right to "accession" designed to encourage producers to

this case reliance can be placed not on However, exporters did not take out such insurance: if they passed the cost the provision of Article 6 but only on of it on in their selling prices, the that of Article 11 (1) of Regulation No products would no longer be 192/75. However that provision does competitive with those from third not establish any right to compensation countries; and profit margins were too in respect of goods which perish before small for the cost to be borne by the reaching the country of destination. Its exporters themselves. effen is only what is already stated in U.F.C. also made the point that the the provisions of Regulations No purpose of "accession" compensatory 229/73 and No 269/73: a right to the amounts was the same as that of export grant of compensatory amounts arises refunds, namely to enable Community only when the products concerned have goods to withstand the competition of reached the Member State of goods from third countries. destination and are put on the market there. The amount claimed can be paid 3. The Advocate General delivered his only after proof of such importation. opinion at the hearing on 21 June 1978.

Decision

1 By an order of 14 December 1977 which was received at the Court on 11 January 1978, the Finanzgericht Hamburg submitted two questions under Article 177 of the EEC Treaty concerning the interpretation of Article 5 (2) of Regulation No 269/73 of the Commission of 31 January 1973 laying down detailed rules for the application of the system of "accession" compensatory amounts (Official Journal L 30, p. 73).

In order to compensate for such differences in price levels as may have continued to exist during a transitional period expiring not later than the end of 1977, Article 55 of the Act of Accession provided for the levying or granting of compensatory amounts equal to the difference between the prices fixed for the new Member State concerned and the common prices.

That temporary arrangement was designed to facilitate the transition of the new Member States from their previous status as third countries in relation to the Community system of export refunds to their new status as Member States.

It was intended inter alia to ensure that the principle of Community pref­ erence was observed in trade between the Community as originally constituted and the new Member States before the full and complete integration of the latter into the common organization of agricultural products.

4 It is common ground that if the exporter were refused the grant of "accession" compensatory amounts in circumstances such as those in the present case, after goods have perished in transit as a result of force majeure,

JUDGMENT OF 11. 7. 1978 — CASE 6/78

he would suffer a real loss, as the insurance taken out in favour of the purchaser pursuant to the c.i.f. clause would cover only the value of the goods in terms of the prices prevailing in the importing country, and not in terms of the higher common prices prevailing in the exporting country.

Costs

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

UNION FRANÇAISE DE CÉRÉALES v HAUPTZOLLAMT HAMBURG-JONAS

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 court, the decision on costs is a matter for that court.

On those grounds,

THE COURT

Registrar President