C-240/78

JUDGMENT OF 21. 6. 1979 — CASE 240/78

Council laying down general rules for Regulation No 1889/76 provided that granting private storage aid for the obligations set out in Article 3 (2) pigmeat and No 1889/76 of the of the said regulation have been Commission laying down detailed fulfilled in their entirety. rules for granting private storage aid for pigmeat. The Member States may 3. The absolute nature of Article 5 (2) of apportion amongst several national, Regulation No 1889/76 is contrary to institutions the task of adopting the the principle of proportionality in that various necessary implementing it does not permit the penalty for measures. In this latter case it is which it provides to be made however incumbent on the said commensurate with the degree of national institutions to ensure by failure to implement the contractual appropriate means that the measures obligations or with the seriousness of which they adopt are co-ordinated in the breach of those obligations. such a way that they do not jeopardize the proper functioning of Accordingly, notwithstanding the the organization of the market. provisions of that article, Article 4 (2) (b) of Regulation No 2763/75 2. The belated transmission to the of the Council remains applicable in competent intervention agency of the the sense that the competent authority documents relating to the various may declare the deposit forfeit in storage operations does not prevent whole or in part according to the the acquisition of the right to aid gravity of the breach of the contr­ within the meaning of Article 6 (2) of actual obligations.

ATALANTA v PRODUKTSCHAP VOOR VEE EN VLEES

THE COURT

composed of: J. Mertens de Wilmars, President of the First Chamber, acting as President, Lord Mackenzie Stuart (President of the Second Chamber), P. Pescatore, M. Sørensen, A. O'Keeffe, G. Bosco and A. Touffait, Judges,

Advocate General: G. Reischl Registrar: A. Van Houtte

gives the following

JUDGMENT

deposit, "which shall be forfeited in meat] would thereafter take charge of whole or in part if these are not fulfilled the procedure concerning aid and that or only partially fulfilled (Article 4 (2) Atalanta could, where appropriate, refer (b)) shall be permitted to tender and to to the Produktschap in this matter. conclude a contract.

ATALANTA v PRODUKTSCHAP VOOR VEE EN VLEES

of deposits, is exclusively held by the nevertheless is not entitled to aid national intervention agencies, if the proof of storage referred to in Article 3 (2) (c) of the regu­ or lation was sent to the relevant intervention agency but not must the provisions and the scope 'without delay'? thereof be understood as meaning that the power to take decisions in Ill (1) Must the term 'obligations' in respect of the implementation and Article 4 (2) (b) of Regulation application of the rules laid down by (EEC) No 2763/75 be those provisions both in respect of understood as including only the granting of aid and in respect of obligations to put into store and deposits, or else solely in respect of to store pigmeat or must that the granting of aid, is held by the term be understood as including national Member States, albeit with also subsidiary obligations with the obligation to grant the aid in regard to information and accordance with the contract supervision? concluded with the relevant intervention agency? (2) Must the term 'obligations' in II Properly interpreted, does Article 6 Article 5 (2) of Regulation (EEC) No 1889/76 be (2) and (3) of Commission Regu­ lation (EEC) No 1889/76 signify that understood as including only the the storer obligations to put into store and to store pigmeat or must that term be understood as including (1) has a right to aid if the also the obligations referred to in obligations referred to in Article Article 6 (2) (b) to (e) of the last- 3 (2) (a) of the aforesaid regu­ lation are fulfilled in their mentioned regulation? entirety, (3) If Article 4 (2) (b) of Regulation and (EEC) No 2763/75 must be understood as signifying that the (2) has a right to payment of the term 'obligations' used there amount of aid once it has been includes only the obligations to ascertained that the contractual put into store and to store obligations have been fulfilled pigmeat but in Article 5 (2) of and, inter alia, the proof of Regulation (EEC) No 1889/76 the same term is to include the storage has been sent to the intervention agency, although obligations described in Article 3 this was not done 'without (2) (b) to (e) of that regulation is delay', the aforesaid Article 5 (2) valid in that respect? or

(2) If Question I is answered in the the purpose of the implementation of affirmative is Article 5 (2) in that regulations on the granting of private respect compatible with Article 4 storage aids for pigmeat and of the regu­ (2) (b) of Regulation (EEC) No lations laying down detailed rules for the 2763/75 wherein it is provided in application thereof. respect of deposits that they shall be forfeited in whole or in part The argument put forward by the 'if [the contractual obligations] Produktschap at the hearing before the are not fulfilled or are only College van Beroep, to the effect that the partially fulfilled' and if not is Produktschap decides upon the granting Article 5 (2) in that respect of aids whilst another authority, the invalid?" V.I.B., decides matters concerning deposits, creates an unfortunate risk of The judgment was received at the Court a discrepancy between the decision Registry on 3 November 1978. adopted with regard to the deposit and that adopted with regard to the aid. The appellant in the main action, represented by C. Sjenitzer, of the However, since none of the basic regu­ Amsterdam Bar, the respondent in the lations establishes definitive rules, main action, represented by its chairman, providing instead a framework which the G. A. Meijer, and the Commission of the measures of the Member States must not European Communities, represented by exceed, the appellant in the main action H. Bronkhorst, a member of its Legal considers that, having regard to the need Department, acting as Agent, lodged to concentrate the power of decision in written observations in accordance with the hands of a single authority, the Article 20 of the Protocol on the Statute Netherlands system, within which the of the Court of Justice of the EEC. Produktschap is invested with the power of decision, is effective in practice and The Court, having heard the report of not at variance with the (minimal) the Judge-Rapporteur and the views of requirements of the regulations. the Advocate General, decided to open the oral procedure without any preparatory inquiry. Question II

(Notice No 9/77) does not coincide with fault. On the other hand, if it were the scope of the concept expressed by the possible to impose a partial loss of the words "without delay". right to recover the deposit the administrative penalty could be rendered proportionate thereto. If the Court considers that the foregoing is not by implication included in the question which was submitted to it or It appears that the reply to Question IV considers that the period laid down by (1) must be in the negative and that, if the Court were to arrive at a different the "Mededeling Vlees" is in order, the appellant in the main action observes conclusion, Article 5 (2) of Commission that it is clear from the wording of Regulation No 1889/76 is not Article 6 (2) of Regulation No 1889/76 compatible with Article 4 (2) of Regu­ lation No 2763/75 of the Council, which of the Commission that the right to an aid is created as soon as the obligation was clearly and expressly intended to laid down in Article 3 (2) (a) is fulfilled. permit partial forfeiture as a reduced It is inconceivable that the regulation penalty. should permit a situation in which the right to receive an aid can never be There would be no incompatibility if honoured by payment thereof. Article 5 (2) of Commission Regulation No 1889/76 were interpreted as applying to the breach of important obligations The prompt transmission of documents is imposed upon the contracting parties, undoubtedly important but minor whilst Article 4 (2) of Regulation No omissions at the level of administrative 2763/75 of the Council refers to the formalities should be assessed in a spirit breach of both important and less of fairness and in terms of the interests important obligations. concerned; the prevention of such minor omissions must not be undertaken as though they constituted failures to fulfil essential obligations. B — The respondent in the main action emphasizes first of all that the decision at issue in the main action was taken only after it had on a number of occasions Questions III and IV given express warnings of the consequences which would follow if the necessary documents were lodged late. Questions III and IV concern the deposits. In this connexion it is clear that Regulation No 1889/76 of the The respondent in the main action then Commission, unlike Article 4 (2) of Regu­ describes the legal framework within lation No 2763/75 of the Council, does which the powers which it exercises were not recognize the complete loss of the conferred by Netherlands legislation. right to recover the deposit. The answers to the third and fourth questions are related in that, if the complete loss of the Question I right to recovery of the deposit were the only possible outcome, that loss would be justified only if there were serious According to the respondent in the main negligence such as to threaten the action the Community regulations in objectives of the rules — so that the question left to the Member States the penalty is not disproportionate to the duty of appointing the bodies charged

with the implementation of the said regu­ wording of Article 4 (2) (b) of Regu­ lations. The words "intervention agency" lation No 2763/75 of the Council and employed in the Community provisions that of Article 5 (2) of Commission Regu­ can mean in the Netherlands the lation No 1889/76 are clear. Produktschap, the V.I.B. or both. The respondent in the main action again In accordance with Netherlands emphasizes that in its view the legislation the Produktschap is obligations are not restricted to those set competent to settle questions concerning out in Article 6 (2) (b) to (e) of aid whilst the V.I.B. is competent to take Commission Regulation No 1889/76. In decisions concerning deposits. The the wording of Article 6 (2) of Regu­ reason for conferring that competence lation No 1889/76 the expression on the V.I.B is that it, as a contracting "without prejudice to the other party, is the better placed to assess obligations of the storer" is in fact whether the contractual obligations have employed. been fulfilled. If the word "obligation" were Although applications against the interpreted as meaning exclusively the decisions of the V.I.B. fall within the obligations concerning the taking into jurisdiction of the ordinary courts and store and maintenance of the pigmeat in not that of the administrative courts the store there would no longer exist V.I.B. would take the necessary action if penalties for failure to fulfil subsidiary the Court of Justice ruled that the obligations. Such a solution is deposit should be released wholly or in undesirable by reason of the important part. supervisory function interent in those obligations. Furthermore, regard must also be had for the fact that the Question II provisions concerning refusal of aid and Since Article 6 (2) of Commission Regu­ forfeiture of the deposit are applied lation No 1889/76 is prefaced by the with circumspection. Nevertheless, all reasonable attitudes have their limits; words "without prejudice to the other obligations of the storer", it does not those limits were exceeded in the present case. provide a basis for the view that the right to the aid is created as soon as all the Having regard to the foregoing it is obligations set out in Article 3 (2) (a) unnecessary to consider the reply to be have been fulfilled. The person concerned must establish that he has given to Question III (3) put by the College. fulfilled not only the obligations listed in Article 3 (2) but also the obligations laid down by other articles. Question IV

Article 4 (2) (b) of Regulation No that in each Member State intervention 2763/75 of the Council. The wording of measures may be effected exclusively by the latter provision does not preclude a a single agency there is nothing to declaration that the entire deposit is prevent a Member State from entrusting forfeited where there is a partial failure to one agency (such as the V.I.B.) the to fulfil contractual obligations. If the task of concluding storage contracts and legislature had intended to make the to another (such as the Produktschap) extent of the loss of the right to have the the payment of the aid. deposits released commensurate with the degree of fulfilment of the obligation it The view put forward by the would have had to employ different Commission is fully in accordance with wording. that adopted by the Court of Justice in the judgment delivered in International In its concluding remarks the respondent Food Company v Produktschap voor in the main action states in particular Groenten en Fruit [1971] 2 ECR 1107. In that it would be desirable in every that judgment the Court ruled that when respect to draw a distinction in provisions of the Treaty or of regulations accordance with the nature of the confer powers or impose obligations on obligations for the purpose of the Member States for the purposes of the penalties which it may be necessary to implementation of Community law the impose for failure to respect those question of how such powers are to be obligations. The respondent in the main exercised and whether the States may action nevertheless considers that that entrust the implementation of such would require amendment to the obligations to specific national autho­ wording or a judgment of the Court of rities is solely a matter for the Justice to that effect. constitutional system of each State.

JUDGMENT OF 21. 6. 1979 — CASE 240/78

lation whereby the right to the aid is No 1889/76 must be interpreted having acquired as soon as that obligation is regard to the principle of proportio­ fulfilled, albeit without prejudice to the nality, which is a general principle of other obligations of the storer. administrative law which must always be applied to Community law. According to that principle failure to fulfil purely sub­ Consequently the right to payment of the sidiary obligations cannot result in the amount of the aid must be considered to forfeiture of the entire deposit. be acquired at the moment when the supporting documents have been sent, albeit too late, and as soon as the other The Commission accordingly suggests conditions laid down in the contract that the reply to the questions referred have been fulfilled. should be as follows:

ATALANTA v PRODUKTSCHAP VOOR VEE EN VLEES

take into store and to store pigmeat III — Oral procedure and the other obligations referred to in Article 6 (2) (b) to (e) of Regu­ lation No 1889/76. Atalanta Amsterdam B.V., the appellant in the main action, represented by 4. Article 5 (2) of Regulation No C. Sjenitzer, and the Commission of the 1889/76 must be interpreted as European Communities, represented by meaning that the deposit shall be H. Bronkhorst, submitted oral argument forfeited in whole or in part if the and replied to questions put by the Court contractual obligations have not at the hearing on 2 May 1979. been fulfilled or if they have been fulfilled only in part, subject to the application of the principle of pro­ The Advocate General delivered his portionality". opinion at the hearing on 30 May 1979.

Decision

1 By an order of 1 November 1978 which was received at the Court Registry on 3 November 1978 the College van Beroep voor het Bedrijfsleven referred, under Article 177 of the Treaty, four questions to the Court on the interpre­ tation and validity of various provisions of Regulation (EEC) No 2759/75 of the Council of 29 October 1975 on the common organization of the market in pigmeat (Official Journal L 282, p. 1), Regulation (EEC) No 2763/75 of the Council of 29 October 1975 laying down general rules for granting private storage aid for pigmeat (Official Journal L 282, p. 19) and Commission Regulation (EEC) No 1889/76 of 29 July 1976 laying down detailed rules for granting private storage aid for pigmeat (Official Journal L 206, p. 82).

5 It is accordingly for each Member State to determine the institutions which are empowered within its domestic legal system to adopt measures in implementation of the above-mentioned Community regulations. Since the possibility was not expressly excluded by the said regulations, the Member States may apportion amongst several national institutions the task of adopting the various necessary implementing measures. In this latter case it is however incumbent on the said national institutions to ensure by appropriate means that the measures which they adopt are co-ordinated in such a way that they do not jeopardize the proper functioning of the organization of the market.

6 The reply to Question I must therefore be that the power to take decisions with regard to the application of the rules laid down by the provisions of Regulations Nos 2759/75, 2763/75 and 1889/76 is held by the institutions designated for that purpose by each Member State.

Question II

7 In the second place the Court of Justice is asked to state whether Article 6 (2) of Regulation No 1889/76 must be interpreted as meaning that

ATA LA NTA v PRODUKTSCHAP VOOR VEE EN VLEES

the right to payment of an aid must be considered to have been acquired if all the obligations set out in Article 3 (2) (a) of that regulation have been fulfilled in their entirety and inter alia the documents relating to the storage have been sent, albeit too late, to the intervention agency or whether on the other hand Article 6 (2) of the above-mentioned regulation must be interpreted as meaning that the storer cannot claim the right to an aid if the documentary proof of storage has not been sent to the intervention agency "without delay".

10 It accordingly appears from Article 3 (2) (a), read in conjunction with Article 6 (2), that the regulation draws a distinction between, on the one hand, the principal obligations which are incumbent on the storer under the storage contract, the fulfilment of which is a condition of acquisition of the right to the aid and, on the other hand, obligations intended to permit the supervision of the storage operations. Thus Article 6 (2) of the regulation precludes the storer from claiming the aid only if the principal obligations have not been fulfilled in their entirety.

JUDGMENT OF 21. b. 1979 — CASE 240/78

11 It follows that, although the storer cannot claim payment of the aid if he has not in particular sent to the intervention agency the documents relating to the storage operations, the mere fact that he did not do so within the pres­ cribed period does not in itself entail the loss of the right to aid where the principal obligations imposed in the contract have been fulfilled in their entirety.

12 The reply to Question II must accordingly be that belated transmission to the competent intervention agency of the documents relating to the various- storage operations does not prevent the acquisition of the right to aid within the meaning of Article 6 (2) of Regulation No 1889/76 provided that the obligations set out in Article 3 (2) of the said regulation have been fulfilled in their entirety.

Questions III and IV

13 Finally, the Court is requested to define the scope and pronounce upon the validity of Article 5 (2) of Commission Regulation No 1889/76 with particular reference to the provisions laid down in Article 4 (2) (b) of Regu­ lation No 2763/75 of the Council.

16 The reply to Questions III and IV referred by the national court must therefore be that notwithstanding the provisions of Article 5 (2) of Commission Regulation No 1889/76, Article 4 (2) (b) of Regulation No 2763/75 of the Council remains applicable in the sense that the competent authority may declare the deposit forfeit in whole or in pan according to the gravity of the breach of the contractual obligations.

Costs

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

18 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 as to costs is a matter for that court.

On those grounds,

THE COURT

Sørensen O'Keeffe Bosco Touffait

Delivered in open court in Luxembourg on 21 June 1979.

A. Van Houtte J. Mertens de Wilmars Registrar President of the First Chamber, Acting as President

OPINION OF MR ADVOCATE GENERAL REISCHL DELIVERED ON 30 MAY 19791

Mr President, prices. These measures include inter alia Members of the Court, aid in respect of private storage.

The Council, as is provided for in Article The common organization of the market 7 of Regulation No 2759/75, laid down in pigmeat (Regulation (EEC) No basic rules for that purpose in Regulation 2759/75 of the Council of 29 October (EEC) No 2763/75 of 29 October 1975 1975, Official Journal L 282 of 1 (Official Journal L 282, p. 19); November 1975, p. 1) provides in Article implementing provisions in that 3 that intervention measures may be connexion were enacted in Commission taken if there is a substantial fall in Regulation (EEC) No 1889/76 of