C-216/78

on the interpretation of Regulation (EEC) No 1259/72 of the Commission of 16 June 1972 (Official Journal, English Special Edition 1972 (II), p. 559) concerning the application of the favourable tariff provisions provided for in that regulation to concentrated butter from storage,

THE COURT (First Chamber)

composed of: J. Mertens de Wilmars, President of Chamber, A. O'Keeffe and G. Bosco, Judges

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

gives the following

JUDGMENT

— The tenderer may not take part in the invitation to tender unless he gives an undertaking in writing inter Article 6 (1) (e) provides; finally that the tenderer shall undertake to include in the alia to comply with certain conditions regarding the composition and contract of sale, in the case of any sub­ production of concentrated butter, sequent resale of concentrated butter, the the use thereof, the time within same requirements as those relating to which such use must take place and the keeping of stock records and the use obligations to be complied with of the product. where concentrated butter is resold. When the tenderer is awarded the butter from storage he becomes the "successful Article 6 (1) establishes: tenderer": he "takes over" the quantities of butter which have been awarded him — The minimum fat content of the and has a period of 120 days in which to concentrated butter produced in an complete the processing in accordance approved establishment after with the prescribed use. In order to processing of the butter sold from ensure that the conditions prescribed by storage by the intervention agencies Article 6 (1) are complied with the regu­ (the product referred to under (a)); lation provides as follows:

— On the other hand (Article 15) "from corresponding to the difference between the time of its removal from store the monetary compensatory amounts and until it is processed into products normally payable and the reduced coming under heading 19.08 of the amounts originally paid. Common Customs Tariff, the butter shall be subject to customs or 3. Beljatzky's protest against that equivalent administrative control". assessment was rejected and the dispute was brought before the Finanzgericht Finally, in view of the fact that, in Düsseldorf. Since the Finanzgericht applying monetary compensatory considered: amounts to importations into another Member State of butter from storage or — On the one hand that an interpre concentrated butter, it was necessary to tation of Article 20 of the regulation take account of the reduced value of in question in the light of the such products it was provided in Article objective pursued by the system 20 that the monetary compensatory thereby set up would logically lead to amounts normally applicable (Regulation the taking into account of the No 974/71 of the Council) to butter, ultimate use of the butter and permit concentrated butter or butter with added withdrawal of the tariff advantage sugar should be multiplied by a granted if it were shown that the coefficient of 0.3. butter was not used in accordance with its lawful purpose; and

1259/72. Later, however, the authorities it decided, by an order of 18 July 1978, entrusted with the customs or to stay the proceedings and to refer the administrative control provided for in following questions for a preliminary Article 15 of the said regulation found ruling to the Court of Justice, pursuant that proof had not been furnished that to Article 177 of the EEC Treaty: the use of the disputed consignments of "1. Is Article 20 of Regulation (EEC)

BF.LJATZKY v HAUPTZOLLAMT AACHEN-SÜD

condition that the product be The present dispute nevertheless differs marketed in accordance with Articles to a considerable degree from the 1 to 19 of the regulation or is there situation considered by the Court in the the further condition that the above-mentioned case. product be used in the manner pre­ scribed by the regulation? Beljatzky put the imported goods under the control of the German customs auth­ 2. In the latter case: orities. Further, a security was provided. When that security was released by the Is Article 20 itself an independent German customs authorities, acting in provision allowing for the levy of a this matter on behalf of the Commission supplementary charge? of the European Communities, they officially established that the goods had 4. The order making the reference was been used in accordance with the pre­ received at the Court on 29 September scribed purpose. It is thus impossible to 1978. argue against the plaintiff, as was done in Case 44/76, that he relied upon mere Beljatzky, represented by J. Neumann, declarations and statements by the Rechtsanwalt, and the Commission of Commission. the European Communities, represented by its Legal Adviser, Peter Gilsdorf, According to Beljatzky it is furthermore assisted by Jörn Sack, a member of its possible that settlement of the point of Legal Department, lodged written obser­ law referred to the Court of Justice by vations in accordance with Article 20 of the Finanzgericht is not directly the Protocol on the Statute of the Court necessary for the latter to give judgment of Justice of the EEC. in the main action.

JUDGMENT OF 28. 6. 1979 — CASE 216/78

Such specified operation forming part of a a criterion moreover leads to an interpre series of legal steps extending from the tation of Article 20 of Regulation No sale of the butter by the intervention 1259/72 to the effect that the reduction agency to its use for the manufacture of in the monetary compensatory amount is pastry products. It is not necessary that only obtained conditionally. If this were the sale should be with a view to export not so it would be impossible to prevent nor is it a purely commercial operation abuses, even the most flagrant. since the sale is effected subject to the condition that the butter is in fact used for the purpose intended.

Since the in fact constitute an incitement to abuse. importer is aware that such control is Even a successful tenderer acting in bad permanent he cannot assert that he failed faith would then have an assurance that to reckon that a re-assessment might be he would pay in respect of butter made and that his expectation that the purchased at a reduced price only a reduction was final should be safe monetary compensatory amount guarded. The re-assessment is not markedly lower than the normal amount excluded merely because the use at whilst he would not suffer excessively variance with the purpose was by sub from the forfeiture of the processing sequent purchasers since in that case no security which merely covers the administrative control would be difference between the reduced price and necessary. the normal market price of the butter. Such a situation would give rise to serious disturbances in the market in butter which Regulation No 1259/72, as According to the Commission the it is stated in its recitals, is in fact importer can moreover pass on (for concerned to prevent. example through a contractual provision) the supplement to the monetary The argument put forward by the compensatory amount which he has been Commission is furthermore confirmed by obliged to pay to the purchaser who has

failed to use the goods in accordance than the normal monetary compensatory with the purpose. Where the importer amount shall be applied to the butter in does not take such steps for his question but in fact state that "that protection he must bear the amount shall be multiplied by a consequences. coefficient". This amounts to stating that the normal compensatory amount The principles applicable to monetary remains applicable and that it is to be compensatory amounts are thus the same reduced (provisionally) only through the

However, since present case the question whether there in such cases the reduction is granted is a legal basis for such recovery must be purely because the person concerned viewed in entirely general terms, not undertakes to put the goods, which are merely within the restricted context of furthermore subject to control, to a Article 20 of Regulation No 1259/72. specific purpose it is clear that the Furthermore, if it were possible to find operation in question is not definitively an appropriate legal basis in Community concluded by the completion of the law national law would no longer be of import formalities. any relevance in this respect. Since Community law thus provides a If the Commission's argument is legal basis for a re-assessment of the accepted, that is, if Article 20 of Regu

1. Article 20 of Regulation (EEC) No lation fixing the monetary compensatory 1259/72 must be interpreted to mean amounts in force at the time when the that it confers the benefit of a importation is effected. It is significant in reduction in monetary compensatory this connexion that those provisions do amounts only on condition that the not state that a reduced amount other goods are used in accordance with

BELJATZKY v HAUFTZOLLAMT AACHEN-SÜD

4 In stating the reasons for the corrective assessment the German authorities claimed that, since the butter in question had not been put by the final user to the use prescribed in the above-mentioned regulation, it could not qualify for the reduced compensatory amounts thereby fixed and that it became liable to the monetary compensatory amounts prescribed for butter freely marketable without restrictions as to its use.

5 The plaintiff in the main action objects inter alia that there is no legal basis for such a corrective assessment since Community law, in particular Regu­ lation No 1259/72, does not contain any independent provisions which authorize the subsequent recovery of the difference between the normal rate and the reduced rate of the compensatory amounts initially applied to the product where it is diverted from its destination laid down by law.

6 In order to have this point clarified the Finanzgericht Düsseldorf has referred the following questions to the Court of Justice:

"1. Is Article 20 of Regulation (EEC) No 1259/72 of 16 June 1972 (Official Journal, English Special Edition 1972 (II), p. 559) to be interpreted as meaning that the definitive preferential levy treatment (reduction of the compensatory amounts) is subject only to the condition that the product be marketed in accordance with Articles 1 to 19 of the regulation or is there the further condition that the product be used in the manner pre­ scribed by the regulation?

2. In the latter case:

9 Regulation No 1259/72 lays down measures of conjunctural economic policy intended to promote the disposal of butter from storage, the prolonged storage of which entails high costs for the agricultural intervention agencies. It promotes such disposal by making provision, through arrangements for standing invitation to tender, for the sale of butter from storage at a reduced price by the agricultural intervention agencies to butter-processing under­ takings in the Community, whereby the successful tenderer undertakes to process the butter purchased into concentrated butter having the composition specified in Article 6 (1) (b) and not to use it or to ensure that it is not used otherwise than for the manufacture of the products in heading 19.08 of the Common Customs Tariff. In order to ensure that the butter thus disposed of is used in accordance with that purpose and that it is not freely marketed the regulation establishes a system of supervision entailing the provision of a processing security, to be released on the conditions set out in Articles 18 and 19 of the regulation.

10 Multiplication, in accordance with Article 20 of the said regulation, by a correcting coefficient which applies to butter from storage sold on the above­ mentioned conditions compensatory amounts considerably less than those normally applied to butter under Regulation No 974/71, does not constitute one of the above-mentioned measures intended to promote the disposal and marketing of butter from storage but forms part of the general rules set out in Regulation (EEC) No 974/71 of the Council of 12 May 1971 (Official Journal, English Special Edition 1971 (I), p. 257).

13 It is in accordance with the same principle for the competent customs auth­ orities to re-assess the reduced compensatory amounts if the products in question have been diverted from their destination or if they have not been used in accordance therewith within the period prescribed by Article 6 of Regulation No 1259/72. In fact, in so far as the importer has failed to furnish proof within the above-mentioned period that the goods have reached the destination which was made a condition of the reduction of the compensatory amounts, the goods cannot be considered as having the conventional value attributed to them on the basis of the minimum selling price referred to in Regulation No 1259/72 and they must be considered as butter sold at the normal market price. In that case the competent customs authorities are required under Regulation No 974/71 of the Council to apply the compensatory amounts laid down for butter marketed at such a price and thus to re-assess the reduced compensatory amounts which were initially applied. Since that re-assessment has regard to the market price of the products in question its legal basis is to be found in the general rules themselves which govern the application of monetary compensatory amounts.

14 For these reasons the reply to the questions submitted must be that the definitive application of the reduced monetary compensatory amounts provided for by Article 20 of Regulation (EEC) No 1259/72 of the Commission of 16 June 1972 presupposes that the goods in question, having regard in particular to the use to which they are to be put, have the reduced value attributed to them by virtue of Regulation No 1259/72. In so far as the importer has not furnished the proof, within the period prescribed in Article 6 (1) (c) and (2) of Regulation No 1259/72, that the goods have been put to the use to which the reduction of the compensatory amounts is subject, the legal basis for the subsequent re-assessment of such amounts is to be found in the general rules governing the system of monetary compensatory amounts, as established by Regulation No 974/71 of the Council of 12 May 1971.

The definitive application of the reduced monetary compensatory amounts provided for by Article 20 of Regulation (EEC) No 1259/72 of the Commission of 16 June 1972 and in Article 20 of Regulation (EEC) No 232/75 of the Commission of 30 January 1975 presupposes that the goods in question, having regard in particular to the use to which they are to be put, have the reduced value attributed to them by virtue of those regulations. In so far as the importer has not furnished the proof, within the period prescribed in Article 6 of the said regulations, that the goods have been put to the use to which the reduction of the compensatory amounts is subject, the legal basis for the subsequent re­ assessment of such amounts is to be found in the general rules governing the system of monetary compensatory amounts, as established by Regu­ lation No 974/71 of the Council of 12 May 1971.

Mertens de Wilmars O'Keeffe Bosco

Delivered in open court in Luxembourg on 28 June 1979.

A. Van Houtte J. Mertens de Wilmars Registrar President of Chamber