C-139/79

In Case 139/79

MAIZENA G M B H , whose registered office is at 218 Spaldingstraße, D-2000 Hamburg, represented by its Directors Karl-Heinz Schlieter and Klaus A. Schroeter, assisted by Hans G. Kemmler, Barbara Rapp-Jung and Alexander Boehlke, of the Frankfurt am Main Bar, with an address for service in Luxembourg at the Chambers of Ernest Arendt, 34b Rue Philippe II,

applicant,

MAIZENA v COUNCIL

supported by

EUROPEAN PARLIAMENT, represented by its Director-General Francesco Pasetti Bombardella, assisted by Roland Bieber, Principal Administrator in its Legal Department, and Professor Arved Deringer, with an address for service in Luxembourg at the Secretariat General of the European Parliament, intervener, v

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

gives the following

JUDGMENT

Facts and issues

I — Facts and procedure cases between sugar and isoglucose manufacturers). The Court added nevertheless that its judgment left the A — History of the adoption of Council Council free to take any necessary Regulation No 1293/79 measures compatible with Community law for ensuring the proper functioning of the market in sweeteners. By judgment of 25 October 1978 on the reference for a preliminary ruling in Joined Cases 103/77 and 145/77 Royal Following that judgment the Commission Scholten-Honig (Holdings) Ltd v laid before the Council on 7 March 1979 Intervention Board for Agricultural a proposal for a regulation amending the Produce; Tunnel Refineries Ltd v provisions of Regulation No 1111/77 Intervention Board for Agricultural which had been held to be invalid. On 13 Produce [1978] ECR 2037 the Court of March 1979 the Council decided to Justice held that Council Regulation No consult the European Parliament on that 1111/77 of 17 May 1977 laying down proposal. common provisions for isoglucose (Official Journal L 134, p. 4) was invalid Following that decision the Council on to the extent to which Articles 8 and 9 19 March 1979 consulted the Parliament thereof imposed a production levy on pursuant to Article 43 of the EEC isoglucose of 5 units of account per 100 Treaty. In its letter seeking an opinion kilograms of dry matter for the period the Council wrote : corresponding to the sugar marketing year 1977/78. The Court found that the "This proposal takes account of the system established by the above- position after the judgment of the Court mentioned articles offended against the of 25 October 1978 in anticipation of general principle of equality (in those new arrangements for sweeteners which

That proposal by the Bureau of the Par- At the session on 11 May 1979 the draft liament was confirmed at its meeting on resolution was put to the vote. On that 10 May 1979 in the following words: occasion Mr Hughes, a Member of the Parliament, raised a question of procedure to which Mr Giolitti, a member of the Commission, answered — "Confirms the position adopted at that he had nothing to add to what Mr the above-mentioned meeting when it Gundelach had said the day before. On was decided not to provide for an being put to the vote the motion for a additional session between the last resolution was rejected and pursuant to session of the present Parliament and Article 22 of the Rules of Procedure of the session of the Parliament elected the Parliament was referred back to the by direct universal suffrage, provided Committee on Agriculture for recon- always that where the majority of the sideration. effective members of the Parliament,

JUDGMENT OF 29. 10. 1980 — CASE 139/79

On the basis of the proposal for a regu- lation by the Commission on which the 1. Article 9 shall apply for the period Parliament had been consulted on 19 1 July 1979 to 30 June 1980.. March 1979 but had not given its formal opinion the Council adopted on 25 June 2. The arrangements applicable from 1979 Regulation No 1293/79 (Official 1 July 1980 shall be adopted by the Journal L 162, p. 10 with corrigendum in Council before 1 January 1980 in Official Journal L 176, p. 37) amending accordance with the procedure laid Regulation No 1111/77. However the down in Article 43 (2) of the Treaty. preamble to Regulation No 1293/79 contains the words "having regard to the fact that the European Parliament has Article 9 been consulted". Pursuant to Article 5 thereof the regulation entered into force on 1 July 1979. 1. A basic quota shall be allotted to each isoglucose-producing undertaking established in the Community, for the B — Regulation No 1293/79 period referred to in Article 8 (1)

The regulation amended Regulation No Without prejudice to implementation of 1111/77 in the light of the judgment of paragraph (3), the basic quota of each the Court of 25 October 1978. Taking such undertaking shall be equal to twice the view that the most appropriate means its production as determined under this for avoiding any inequality of treatment regulation, during the period 1 No- between sugar and ispglucose manufac- vember 1978 to 30 April 1979. turers was to subject isoglucose production to rules analogous to those 2. To each undertaking having a basic applying to sugar production until 30 quota, there shall also be allotted a

maximum quota equal to its basic quota equal to 5 % of the total of basic quotas multiplied by a coefficient. This established pursuant to paragraph (1). coefficient shall be that fixed by virtue of the second subparagraph of Article 25 (2) of Regulation (EEC) No 3330/74 for 7. The quantity of isoglucose produced the period 1 July 1979 to 30 June 1980. during the period referred to in Article 8 (1) which: 3. The basic quota referred to in — exceeds the maximum quota of the paragraph (1) shall, if necessary, be corrected so that the maximum quota undertaking, determined in accordance with or paragraph (2): — was produced by an undertaking not having a basic quota, may not be — does not exceed 85 %, disposed of on the Community's internal — is not less than 65 % market and must be exported in the natural state to third countries without of the technical production capacity per the application of Article 4. annum of the undertaking in question. 8. For the quantity of isoglucose 4. The basic quotas established production which exceeds the basic pursuant to paragraphs (1) and (3) are quota without exceeding the maximum fixed for each undertaking as set out in quota Member States shall charge a Annex II. production levy on the isoglucose producer concerned. 5. Isoglucose-producing undertakings which have not produced any during the For the period referred to in Article 8 reference period referred to in the (1), the amount of the isoglucose second subparagraph of paragraph (1) production levy shall be equal to the and which can be shown to have share of the sugar production levy, as resumed systematic production during fixed for the 1979/80 sugar year by the period referred to in Article 8 (1) virtue of Article 28 of Regulation (EEC) shall be allotted a basic quota equal to No 3330/74, borne by the sugar manu- the highest volume of their production facturers. attained during one of the following periods: 9. The Council, acting by a qualified — 1 August 1976 to 31 July 1977, majority on a proposal from the Commission, shall allocate the quotas — 1 July 1977 to 30 June 1978. referred to in paragraphs (5) and (6) and shall adopt any general rules necessary A maximum quota shall be allotted to for the application of this article. such undertakings, determined in accordance with the provisions of 10. Detailed rules for the application of paragraph (2). this article, which shall in particular provide for the levying of a charge on 6. A basic quota shall be allotted to the quantity of isoglucose referred to in undertakings starting systematic pro- paragraph (7) which has not been duction of isoglucose during the period exported in the natural state during the referred to in Article 8 (1) within the period referred to in Article 8 (1) and fix limits of a Community reserve quantity the amount of the production levy

C — The course of procedure and the was compulsory the Council has acted events relating thereto before the European Parliament gave its opinion. By application registered at the Court Registry on 5 September 1979 Maizena GmbH, an undertaking in the maize Having regard to the aforementioned processing sector which manufactures matters I should be glad if you would let starch and products derived from starch me know the attitude of your institution mainly at Krefeld in the Federal on this issue; the Bureau of the Republic of Germany, asked the Court European Parliament obviously reserves to declare that Regulation No 1111/77 its right of action to enforce respect for as amended by Regulation No 1293/79 the provisions of the Treaties." is null and void in so far as by Article 9 (4) it lays down in Annex II thereto a The President of the Council answered production quota for isoglucose relating that letter by a letter dated 23 October to the applicant on the basis of Article 9 1979 in which he defended the adoption (1) to (3). of Regulation No 1293/79 before the On 17 August 1979 the President elected opinion of the Parliament had been by the directly-elected Parliament wrote received and referred to the "legal need to the President of the Council a letter in to implement before too long the which it was said: judgment of the Court of Justice . . . given on 25 October 1978" and to the "In spite of the fact that consultation of "extreme importance for the public that the European Parliament on this matter the isoglucose arrangements be adopted

The applicant claims that the Court By order of 13 February 1980 the Court should: allowed the Commission to intervene in support of the contentions of the Council. 1. Declare that Council Regulation No WW/77 laying down common provisions for isoglucose, as amended by Council Regulation No 1293/79 of On 28 May 1980 the applicant sent the 25 June 1979, is null and void in so Court an addendum to the reply in far as by Article 9 (4) it lays down in which, citing Article 42 of the Rules of Annex II thereto a production quota Procedure, it dealt with "various new for isoglucose relating to the applicant and relatively independent defences" put on the basis of Article 9 (1) to (3); forward by the Council in its rejoinder; they were discussed by the Commission at greater length in its pleading as intervener. 2. Order the Council to pay the costs.

JUDGMENT OF 29. 10. 1980 — CASE 139/79

The Commission, as intervener, supports In its defence the Council contends that the contentions of the Council that the the applicant is challenging the very applicant's claim should be dismissed. principle of limitation of production achieved by any system of quotas claiming that it is contrary to various basic rules of the Community system and in particular the liberal.philosophy of the Ill — Submissions and argu- Treaty and the system of competition. m e n t s of t h e p a r t i e s The Council however admits that the question is complicated by the fact that A — Admissibility of the application the regulation contains on the one hand general provisions not applying individually and aimed at all isoglucose The applicant claims that the application manufacturers and on the other hand is admissible under the second paragraph provisions in the annex referring to the of Article 173 which provides that any quota of each manufacturer. The legal person may institute proceedings applicant however considers the regu- against a decision which, although in the lation in conjunction with its annex as form of a regulation, is of direct and constituting in fact a disguised special individual concern to him. decision of direct and individual concern to it and challenges all its provisions especially those of a general and The applicant maintains that the regu- impersonal nature. lation is of direct concern to it because it is the contested system itself which materially affects the applicant's legal Accordingly, without referring to Article position without there being any 91 of the Rules of Procedure, the necessity for a further measure of the Council contends that the application is institutions or of the Member States. In inadmissible. the applicant's case there is a direct allocation of a quota by Article 9 (4) of As regards the legislative nature of the the regulation in conjunction with Annex regulation the Council maintains that II according to which the applicant's care must be taken to avoid being misled

by what is in the annex which lists the The applicant replies that it is challenging present isoglucose manufacturing under- only the provisions of Article 9 (4) and takings and determines the basic quota Annex II to the regulation which have for each of them. It is necessary to bear not only the appearance but also the legal in mind that the regulation determines nature of a decision. It is not challenging the amount to which each undertaking is the legislative nature of other provisions entitled generally and impersonally on of the regulation and in particular those the basis of its production during the of the new Article 9 (1) and (3) which reference period which applies to all and constitute the basic measure for the is also determined impersonally. The contested implementing provisions, annex with its appearance of a decision namely those fixing the quotas.

3330/74 and no one has ever challenged the nature of that instrument as a regu- lation. The only important difference is that whereas in the sugar sector the quota is set by the Member States In its rejoinder the Council admits that at according to the very precise criteria laid first sight certain aspects may incline to down in Regulation No 3330/74, under give Annex II the character of a decision. Regulation No 1293/79 it is the Council It contends however that the annex must which, on the basis of the criteria which be considered with regard to Article 9 it has itself fixed, has set out the (1) to (3) without which it would be corresponding basic quota for each incomprehensible. The table published as

JUDGMENT OF 29. 10. 1980 — CASE 139/79

9 (1) tö (3). The specification of basic all the provisions of the EEC Treaty in quotas in Annex II does not therefore relation to agriculture and competition, constitute an independent rule and and from their relationship inter se, that cannot be regarded as a disguised the extensive powers which are granted decision. to the Community institutions must be exercised with due regard to the creation Neither the Parliament nor the of effective competition in the agricultural Commission addresses any argument to sector. Council Regulation No 26 the question of the admissibility of the applying certain rules of competition, application. On the other hand the production of and trade in agricultural Commission considers that there is a products (Official Journal, English major interest in having the substantive Special Edition 1959-1962, p. 129) has questions settled once and for all by the the same philosophy. Court. If there were no judgment on the merit the issue would return in the form of references for preliminary rulings by the national courts. In the applicant's view the minimum requirements of the principles of Community law on competition are not satisfied for two reasons in particular. B — The merits of the application

MAIZENA v COUNCIL

JUDGMENT OF 29. 10. 1980 — CASE 139/79

discrimination and disproportionality. The Council refutes in detail each of the "Review" by the Court must therefore arguments put forward by the applicant be "restrained" so that it recognizes only in support of the submission that there manifest cases of discrimination or is discrimination against isoglucose in disproportionality. favour of sugar. In a more general way it recalls the transitional nature of the regu- lation, the extreme importance for the public of a balance between the two products, and Article 39 (c) of the EEC Subject to its observations on the Treaty and considers that each of those admissibility of the action the Council reasons is amply sufficient to justify the considers the submissions on the merits measure in question which is merely a made by the applicant and challenges protective measure in anticipation of new each of them. rules relating to sugar to be adopted by the Council as from the 1980/81 marketing year.

MAIZENA v COUNCIL

the economy. Article 3 (f) of the Treaty is no doubt aimed at these two aspects of The applicant maintains the argument the problem. However as regards the that the quota system infringes the second aspect the applicant is assuming principle of proportionality by reason of that basically the Treaty prescribes on the date on which it was introduced and principle a liberal economic order, the restrictive nature of its provisions. It namely a free market economy in which alleges in particular that the said system certain closely defined restrictions are was imposed at a date and with terms allowed only by way of exception. which had as their sole aim to bar Recent case-law of the Court (see in isoglucose from access to the market. particular the judgment of 13 December Limitation of production to a maximum 1979 in Case 44/79 Hauer; judgment of of 85 % of capacity shows this clearly.

Treaty. As regards the submission of discrimi- nation against isoglucose in relation to sugar and discrimination between The Council is of the opinion that the isoglucose manufacturers inter se the applicant has no doubt deliberately applicant joins issue with the Council avoided extending the arguments in both as regards facts and the law. relation to the first submission to claiming an infringement of a rule of law inasmuch as it avoids making the problem one of fundamental rights and In its rejoinder the Council maintains in particular freedom to trade. that the applicant has in no way shown, at least not in relation to its observations on discretion, that "general rules” or "principles" of Community law (in the Contrary to what the applicant assumes, present case, the principle of free the aim of undistorted competition in the

Community cannot be regarded pursuant economic activity, since the manufacture to Article 3 (f) of the EEC Treaty as of an of isoglucose cannot be regarded as an absolute nature. On the contrary it must independent form of economic activity. be related to other equally important It is only a particular type of enterprise aims in the Treaty. Consequently from directly related to numerous other the point of view of freedom to engage activities and in particular the manu- in economic activity the applicant's claim facture of starch. must come down to the question whether the rules in relation to quotas, having regard to the agricultural aims they pursue, constitute an appropriate, necessary, sufficient and not excessively burdensome means of attaining those The complaint too that there is a breach aims. of the principle of proportionality is unfounded especially trie allegation that the quota system is too severe a measure and that future isoglucose production has been wrongly estimated. The rules in relation to quotas for isoglucose must according to the Council be regarded against the background of the organization of the market in sugar and in direct relation thereto. The rules in relation to quotas of the two organ- As regards the alleged discrimination izations of the market are essentially against isoglucose in relation to sugar the intended to deal with the present surplus Council asserts in particular that in on the market in sweeteners and to amending Regulation No 1111/77 it complement one another. In its judgment treated particular matters differently only in the Joined Cases Amylum and Tunnel in so far as this was justified by the facts. the Court of Justice recognized that the Having regard to the applicant's actual Council could take restrictive measures starting position in 1978/79 it had the in respect to isoglucose since the same market opportunities as a sugar isoglucose production contributes to manufacturer. In fact the applicant aims increasing the sugar surplus. at unbridled isoglucose production and unrestricted competition with sugar while maintaining its advantages in relation to costs. In view of its obligations under Article 39 of the EEC Treaty the Council cannot go along with that. The Council discusses the system of quotas in relation to its objectives in great factual detail and concludes that there is no concrete and worthwhile As regards the alleged discrimination of evidence in support of the claim that the the isoglucose manufacturers inter se it system has restrictive effects in many must be said that when Regulation respects. Even if, moreover, manufac- No 1293/79 was drawn up more than turers could have expected something of two years had elapsed in which an explosive increase in their sales for production had left the purely the current marketing year and had experimental stage and isoglucose had wished considerably to increase their found its outlets in the market in production capacity, the rules on quotas sweeteners. It was open to the Council to could not be regarded as unlawful take account of those facts selecting the intervention in their freedom of most recent production figures as the

There is no apparent justification for the In its reply the applicant refers to the failure to consult the Assembly. The failure to consult the European Par- judgment of the Court of Justice of liament. 25 October 1978 is not of a nature to justify the infringement of the Treaty by the Council even if it is understood as an The legal arguments put forward by the invitation to the Council to draw up an European Parliament, as intervener, takes organization of the market for the following form: sweeteners. Likewise the alleged extreme importance for the public of having rules in relation to isoglucose before the 1. Time-limit beginning of the sugar marketing year cannot justify disregard of the Treaty's distribution of powers between the The European Parliament observes that institutions of the Community. Article 43 of the Treaty constitutes the

JUDGMENT OF 29. 10. 1980 — CASE 139/79

2. The nature of the consultation In rejecting the motion for a resolution contained in the Tolman report the Par- Consultation of the Parliament is the liament had not given an opinion on the form, peculiar to the EEC Treaty, of proposal for a regulation which was the participation of the Parliament in the subject of the report. So long as the Par- legislative process of the Community. liament does not adopt a resolution its Consultation forms a large part of the will cannot be determined with certainty. parliamentary business. It is, at least where the Treaty expressly provides for it, a necessary condition (theory of the In meeting the obligations, incumbent composite measure) of the validity of the upon all the institutions, to fulfil the legal measure of the Community. The tasks defined by the Treaties the Par- institutions therefore have no discretion liament must be its own judge of how regarding consultation. It follows that and for how long it considers draft any failure to consult the Parliament legislation. constitutes an infringement of an essential procedural requirement within The Parliament admits that there are the meaning of Article 173 of the Treaty. problems of coordination with the Council and points out that it has Complete respect for the authority of the established a special procedure involving institutions is one of the fundamental inviting the Council to take part in the principles of constitutional law of the work of the Bureau of the Parliament Member States. Any disregard of those and its committees. In the present case

the Council did not make use of that conceivable way of solving the procedure to obtain the opinion of the hypothetical problems of the market in Parliament in due time. sweetners. If a measure had been asbolutely indispensable from the point of view of time and if all efforts to In adopting Regulation No 1293/79 obtain an opinion from the Parliament in before the Parliament gave an opinion due time had failed, the Council could the Council therefore disregarded the have taken measures only of an essential procedural requirement laid undoubtedly transitional nature. down in Article 43 of the Treaty which provides for consultation of the Assembly. As regards the primordial "public" interest in the adoption of rules before 1 July 1979, a ground which conjures up the 4. The position of the Council plea of "state of emergency", the Par- liament maintains that it is not for the Council unilaterally to determine the Refering to the position of the Council appropriate procedure to serve the public as it appears from the defence the Parl- interest. Since Article 137 of the Treaty iament recalls that the Council has in made the Parliament responsible for Article 139 of the Treaty, which auth- representing the peoples of the orizes it to request the meeting of the Community, it is the Parliament which Parliament in extraordinary session, a constitutes the forum to which the means of action enabling it to deal with treaties entrust the definition of the emergency cases. So long as it fails to European "public interest". So long as make use of that means it cannot rely on the institution appointed for that purpose any ground in support of conduct has not expressed its view it cannot be contrary to the Treaty. maintained that there is a public interest without going counter to the tasks entrusted to the various institutions. It is therefore in the alternative that the Parliament considers and challenges the various arguments put forward by the The Parliament claims that by adopting Council. Regulation No 1293/79 the Council infringed a procedural requirement thus It points out in the first place that after depriving the Parliament of its right to the rejection of the motion for a express its opinion on a measure adopted resolution from the Committee on Agri- pursuant to Article 43 of the Treaty and culture the Council did not have so committing a breach of the Treaty. It recourse to the procedure in Article 139 stresses that the regulation might have (2) so that it cannot allege slowness on been different if the Council had been the part of the Parliament in reaching a aware of the opinion of the Parliament. decision.

namely optional, compulsory where the In turn the body consulted must consider opinion is not binding and compulsory and give its opinion. That obligation with an opinion having a binding effect. arises from the power which it has been Only the latter involves true sharing of given and constitutes an effective the power of decision between the condition of its exercise. authority which formally has that power and the authority whose opinion must be followed. Although as regards consultation of the Economic and Social Committee Article The three Treaties mention only 198 of the Treaty allows action in the compulsory consultation as the consul- absence of an opinion, there is no similar tative function of the Assembly. This provision regarding the Parliament. requires the authority having the power Nevertheless in reliance upon the logic of decision to consult the appropriate of the system of the Treaty and authority for an opinion. That is what guidelines from national case-law the is meant by "after consulting the Council alleges that in certain circum- Assembly". stances it is entitled and even obliged to act without the opinion of the Par- liament. On the one hand it is accepted in the public law of various Member States that the authority having power of decision It is in the light of the above may in certain circumstances be relieved consideration that the Council discusses of the obligation to enter into consul- the existence of the complaint of tation. infringement of essential procedural requirements. In the Council's view that question means in the present case Further a defect affecting a measure whether the absence of a formal opinion taken without consultation is censured as may in itself be regarded as constituting an infringement of an essential pro- such an infringement. The Council cedural requirement and not as being discusses this problem from the following ultra vires as would be the case if consul- three aspects: tation had to be regarded as involving true sharing of the power of decision.

(b) Was the power of the Council fettered? In other words the question arises whether the Council risked allowing a discriminatory lacuna in the (ii) As regards the possibility for the law to the detriment of sugar had it not Council, in the absence of appropriate adopted the contested regulation without rules, of using the parliamentary delay. In the Council's view the answer procedure itself, the Council refers in to that question must be in the affirm- first of all to the emergency procedure ative. (internal regulation, Article 14). It is only the Assembly which can classify a mater as of an emergency nature and although the Assembly was properly informed, that did not prevent it from rejecting the The Council contends that in acting in motion for a resolution from the the absence of a formal opinion from the Committee on Agriculture in the Assembly when its power of decision was circumstances described above. As to the fettered by the obligation to deal with possibility of an extraordinary session the situation created by the judgment of which the Ferri report charges the 25 October 1978 and a reasonable period Council with not having requested, the had elapsed since the matter had been Council contends that, contrary to its put before the parliamentary institution it wishes, the Assembly did not consider did not adopt a measure vitiated by such a session appropriate. Since the infringement of an essential procedural attention of the Parliament was drawn to requirement. the urgency and to the discrimination arising from the lacuna in the law, the vote of 12 May constituted a refusal to treat the matter as an emergency or at least a refusal by the Parliament to consider in due time the proposals (c) Lastly the· Council queries whether submitted to it for an opinion and, as far even if it was entitled to act in the as the Council was concerned, exhausted absence of the formal opinion from the the Council's efforts to obtain the Assembly for the reasons set out at (a) opinion sought in sufficient time. and (b) it had the means of causing a formal opinion to be issued.

Assembly has a true power to block the of the imperative need that the opinion legislative body constituted by the be given during the May session. Council acting on a proposal from the Commission, which would be contrary to the Treaties and to the division of Nevertheless if the Court has to declare powers between the four institutions, it Regulation No 1293/79 void for must be held that once a reasonable infringement of the essential procedural period has elapsed the Council must, in requirements of the Treaty the certain exceptional circumstances of an Commission suggests that the provisions emergency nature such as those in the of the said regulation be treated as pro- present case, be entitled to act in the visionally applicable until a new measure absence of a formal opinion. by the Council be validly adopted after an opinion from the Parliament. Such a possibility seems open to the Court under the second paragraph of Article The Council concludes its discussions by 174 of the Treaty which provides that querying the admissibility of the Par- "in the case of a regulation, however, liament's intervention in the present case the Court of Justice shall, if it considers and in Case 138/79 Roquette v Council. this necessary, state which of the effects It is of the view that in reality that of the regulation which it has declared intervention is neither ancillary nor even void shall be considered as definitive". essential and that it constitutes in truth a supplemental action by the misuse of the process of intervention because the Par- The possibility of a decision temporarily liament is not included among those who applying an unlawful measure moreover have a right under Article 173 to bring exists under certain national legal an action for a declaration that a systems, for example in the Federal measure is void. Republic of Germany where the Constitutional Court has made use thereof in revenue matters. The Commission considers that the Council could in the present case act in the absence of an opinion from the Par- liament since the Parliament had a IV — Oral procedure reasonable time to inquire fully into the matter.

2 In support of its application, the applicant, apart from various substantive submissions, makes a formal submission that its production quota fixed by the said regulation be declared void on the ground that the Council adopted that regulation without having received the opinion of the European Par- liament as required by Article 43 (2) of the 'EEC Treaty which action constitutes an infringement of an essential procedural requirement within the meaning of Article 173 of the said Treaty.

3 By order of 16 January 1980 the Court allowed the Parliament to intervene in support of the applicant's claims of infringement of essential procedural requirements. By order of 13 February 1980 it also allowed the Commission to intervene in support of the Council.

4 The Council contended that both the application and the intervention by the Parliament in favour of the applicant were inadmissible. Alternatively it contended that the application should be rejected as unfounded.

JUDGMENT OF 29. 10. 1980 — CASE 139/79

5 Before considering the questions of admissibility raised by the Council and the claim by the applicant it is well to recall briefly the history oi the adoption of the contested regulation and the provisions thereof.

8 The urgency of the consultation requested in the Council's letter related to the fact that in order to avoid inequality of treatment between sugar manu- facturers and isoglucose manufacturers the proposed regulation was basically

MAIZENA v COUNCIL

intended to subject isoglucose production to rules similar to those applying to sugar manufacture until 30 June 1980 pursuant to the common organiz- ation of the market in sugar established by Council Regulation No 3330/74 of 19 December 1974 (Official Journal L 369, p. 1). In particular it was a question of making transitional arrangements until then for production quotas for isoglucose which were to apply from 1 July 1979 which was the beginning of the new sugar marketing year.

9 The President of the Parliament immediately referred the matter to the Committee on Agriculture for further consideration and to the Committee on Budgets for its opinion. The Committee on Budgets forwarded its opinion to the Committee on Agriculture on 10 April 1979. On 9 May 1979 the Committee on Agriculture adopted the motion for a resolution of its Rap- porteur. The report and draft resolution adopted by the Committee on Agri- culture were debated by the Parliament at its session on 10 May 1979. At its session on 11 May the Parliament rejected the motion for a resolution and referred it back to the Committee on Agriculture for reconsideration.

10 The parliamentary session from 7 to 11 May 1979 was to be the last before the sitting of the Parliament elected by direct universal suffrage as provided for by the Act concerning the election of the representatives of the Assembly by direct universal suffrage and fixed for 17 July 1979. At its meeting on 1 March 1979 the Bureau of the Parliament had decided not to provide for an additional session between those of May and July. It had however stated:

12 The Court is asked to declare Regulation No 1293/79 void in so far as it amends regulation No 1111/77.

Admissibility of the application

1 3 In the Council's view the application is inadmissible for it is directed against a regulation and the conditions provided for in the second paragraph of Article 173 of the Treaty are not satisfied. The contested measure is claimed not to constitute a decision in the form of a regulation and not to be of direct and individual concern to the applicant. The applicant maintains on the other hand that the contested regulation is a set of individual decisions one of which is taken in respect of the applicant and is of direct and individual concern to it.

MAIZENA v COUNCIL

14 Article 9 (1), (2) and (3) of Regulation No 1111/77 as amended by Article 3 of Regulation No 1293/79 provides:

" 1 . A basic quota shall be allotted to each isoglucose-producing under- taking established in the Community, for the period referred to in Article 8 (1).

JUDGMENT OF 29. 10. 1980 — CASE 139/79

Admissibility of the Parliament's intervention

17 The Council queries the possibility of the Parliament's intervening voluntarily in the proceedings pending before the Court. In the Council's view a power to intervene of this kind is to be equated with a right of action which the Parliament does not have under the Treaty. In that respect it observes that Article 173 of the Treaty does not mention the Parliament among the institutions entitled to seek a declaration that a measure is void and that Article 20 of the Statute of the Court does not mention it among the institutions invited to lodge observations pursuant to the procedure under Article 177 for a preliminary ruling.

18 Article 37 of the Statute of the Court provides:

"Member States and institutions of the Community may intervene in cases before the Court.

The same right shall be open to any other person establishing an interest in the result of any case submitted to the Court, save in cases between Member States, between institutions of the Community or between Member States and institutions of the Community.

22 In the applicant's view Article 42 of the T r e a t y according to which it is for the Council to determine h o w far the rules on competition shall apply to agriculture does not empower the Council to restrict more than necessary free competition which is one of the fundamental objectives of the T r e a t y referred to in Article 3 (f). T h e measures however adopted by the Council in relation to isoglucose g o beyond w h a t is necessary.

23 The institution of a system of competition which is not distorted is not the only objective referred to in Article 3 of the Treaty which also provides in particular for the adoption of a common agricultural policy. Those respon- sible for the Treaty, conscious that the simultaneous pursuit of those two objectives could sometimes and in certain circumstances prove difficult, provided in the first paragraph of Article 32 that:

"The provisions of the Chapter relating to rules on competition shall apply to production of and trade in agricultural products only to the extent determined by the Council within the framework of Article 43 (2) and (3) and in accordance with the procedure laid down therein, account being taken of the objectives set out in Article 39."

That simultaneously recognizes the precedence the agricultural policy has over the aims of the Treaty in relation to competition and the power of the Council to decide how far the rules on competition should apply to the agri- cultural sector. The Council has a wide discretion in the exercise of that power as it has in the implementation of the whole agricultural policy.

Alleged discrimination against isoglucose manufacturers vis- à-vis sugar manufacturers

27 T h e applicant complains of discrimination against isoglucose manufacturers. Although isoglucose manufacturers and sugar manufacturers are in a comparable situation isoglucose manufacturers are subject to a different quota system. T h e quota system applied to isoglucose takes account neither of the need to maintain free competition nor the fact that sugar and isoglucose are at different stages of development. T h e quotas are calculated on the basis of reference periods which do not correspond with those applying to sugar and the whole system lacks the flexibility which charac- terizes the system for sugar. Finally the isoglucose industry does not enjoy the guarantees of an organization of the market.

MAIZENA v COUNCIL

28 The arguments in relation to competition and the different stages of development of the two industries are merely a repetition of the arguments which have already been answered when a breach of the principles of the right of competition was alleged. The reason for the other differences pointed out by the applicant is to be found in the objective differences between the situations of the sugar and isoglucose industries which the Council has taken into account in exercising its discretion. That submission must therefore be rejected as unfounded.

Discrimination as between isoglucose manufacturers

29 T h e applicant complains that when allocating the quotas between the various isoglucose manufacturers the Council did not take account of the fact that certain undertakings voluntarily restricted their investment in anticipation of the regulation which, after the aforementioned judgment of the C o u r t of 25 October 1978, was to alter the system for isoglucose.

33 The applicant and the Parliament in its intervention maintain that since Regulation N o 1111/77 as amended was.adopted by the Council without regard to the consultation procedure provided for in the second paragraph ol Article 43 of the Treaty it must be treated as void for infringement of essential procedural requirements.

34 The consultation provided for in the third subparagraph of Article 43 (2), as in other similar provisions of the Treaty, is the means which allows the 1 ar- liament to play an actual part in the legislative process of the Community. Such power represents an essential factor in the institutional balance intend- ed by the Treaty. Although limited, it reflects at Community level the fundamental democratic principle that the peoples should take part in the exercise of power through the intermediary of a representative assembly. Due consultation of the Parliament in the cases provided for by the Treaty therefore constitutes an essential formality disregard of which means that the measure concerned is void.

35 In that respect it is pertintent to point out that observance of that requirement implies that the Parliament has expressed its opinion. It is impossible to take the view that the requirement is satisfied by the Council s simply asking for the opinion. The Council is, therefore, wrong to include in the reference in the preamble to Regulation N o 1293/79 a statement to the effect that the Parliament has been consulted.

36 T h e Council has not denied that consultation of the Parliament was in the nature of an essential procedural requirement. It maintains however that in

40 The Council has been unsuccessful and the applicant, albeit not the Par- liament, has asked for an order for costs. It follows that the Council must be ordered to pay only the costs of the applicant.

OPINION OF MR REISCHL — CASE 139/79

On those grounds,

THE COURT

hereby: 1. Declares Regulation No 1293/79 (Official Journal L 162, p. 10 with corrigendum in Official Journal L 176, p. 37) amending Regulation No 1111/77 (Official Journal L 134, p. 4) to be void.

2. Orders the Council to pay the costs of the applicant.

(see Case 138/79, p. 3362)