C-808/79

JUDGMENT OF 26. 6. 1980 — CASE 808/79

and export licences introduced by that formance of the undertaking to provision and that the period of export or import in accordance with validity of licences or certificates is the licences or certificates issued be only one example of the detailed rules ensured by appropriate means, it also which may be adopted by the makes it necessary to ensure that the Commission under the procedure documents are used only for the known as the Management Com- transactions covered thereby. In the mittee procedure. case of advance fixing certificates, Since, moreover, the function given to that need is all the more imperative licences does not enable a distinction since the use of such certificates twice to be made between the right to carry over may confer unjustified benefits out the transaction and the document upon traders and thus impose heavy which allegedly serves only as a mani- financial burdens upon the festation of that right, there is no Community. reason to suppose that the If by requesting advance fixing traders Commission is not empowered to lay take advantage of the considerable down rules in connexion with that benefits derived from that system, it is right or to prescribe that the loss of therefore just that they should bear the document shall entail the the disadvantages which arise from extinction of the right. the necessity, on the part of the 3. It is necessary for the authorities Community, of preventing any abuse. entrusted with the management of the Therefore the risk borne by traders as common organization of the markets a result of the provision contained in to have available precise forecasts on Article 17 (7) of Regulation No future imports and exports. Whilst 193/75 is not disproportionate in that objective requires that the per- relation to the control requirements.

composed of: H. Kutscher, President, A. O'Keeffe and A. Touffait (Presidents of Chambers), J. Mertens de Wilmars, P. Pescatore, Lord Mackenzie Stuart, G. Bosco, T. Koopmans and O. Due, Judges,

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

gives the following

JUDGMENT

Facts and Issues

The facts of the case, the course of and export. The latter certificate was the procedure and the observations issued on 14 June 1979 and its period of submitted under Article 20 of the Statute validity expired on 31 October 1979. of the Court of Justice of the EEC may be summarized as follows: Initially, Pardini approached the Italian Ministry of Foreign Trade with a view to obtaining permission to carry out those I — Facts and written procedure exports on the basis of new documents. The Ministry issued new licences for the exports by way of food aid, but did not 1. The plaintiff in the main proceed- issue a new certificate for the export of ings, a flour-milling company by the the aforesaid 12 500 tonnes of durum name of Fratelli Pardini S.p.A., declares wheat meal. that it suffered the theft on 22 August 1979 of a series of licences or certi- ficates, issued in its name, for the export 2. Subsequently, on 19 November of flour and meal issued by the 1979, Pardini initiated proceedings competent Italian authority. Amongst the before the President of the Tribunale di stolen documents were some which had Lucca, for the annulment of the been granted for the export of flour by document issued in its name, seeking the way of food aid supplied by the EEC annulment and replacement of the stolen and, in addition, a certificate, fixing the certificate. refund in advance at 180 European units of account per tonne, in relation to 12 500 tonnes of durum wheat meal 3. Although he considered that a • which the plaintiff intended to produce decision to annul the document could be

adopted in accordance with the submission of an import or export licence procedure laid down by the Italian Civil which may be issued by Member States Code, the President or the Tribunale di to any applicant irrespective of the place Lucca stayed the proceedings and of his establishment in the Community. referred the following preliminary Widere the levy or refund is fixed in questions to the Court under Article 177 advance, the advance fixing shall be of the EEC Treaty: noted on the licence which serves as supporting document for such advance " 1 . Must the first and second subpara- fixing. graphs of Article 17 (7) of Regu- lation No 193/75 be interpreted as meaning that an exporter who has suffered the theft of an export The import or export licence shall be licence or certificate, valid throughout the Community, fixing in valid throughout the Community. advance the amount of the refunds, may not request and obtain a new The issue of such licences shall be licence or certificate or equivalent conditional on the lodging of a deposit document issued by a national guaranteeing that importation or expor- authority permitting him to carry out tation will be effected during the period the export operations before or after of validity of the licence; the deposit the expiry of the period of validity of shall be forfeited in whole or in part if the stolen document, thus suffering the transaction is not effected, or is only the total loss of the refunds fixed in partially effected, within that period." advance under the said document? Article 9 (3) of Regulation (EEC) No 2. In the event of an affirmative answer 193/75 of the Commission of 17 January to the previous question, is Article 17 1975 laying down common detailed rules (7) of Regulation (EEC) No 193/75, for the application of the system of which imposes a very severe penalty import and export licences and advance upon an exporter who, without any fixing certificates for agricultural fault on his part, has suffered the products (Official Journal L 25, p. 10, theft of an export licence or certi- 1975), provides that: ficate, compatible with the principle of proportionality in the light of the "Licences and certificates shall be drawn decisions of the Court of Justice, up at least in duplicate. The first copy, bearing in mind that the disputed called 'Titular Holder's Copy' and regulation is a regulation of the marked 'No 1', shall be issued without Commission and not a regulation of delay to the applicant and the second, the Council of Ministers of the called 'Issuing Agency's Copy' and EEC?" marked 'No 2', shall be retained by the issuing agency. 4. Article 12 (1) of Regulation (EEC) No 2727/75 of the Council of Copy No 1 of the licence or certificate 29 October 1975 on the common organ- shall be submitted to the office ization of the market in cereals (Official responsible for completing : Journal L 281, p. 1, 1975) provides: (a) in the case of an import licence or of "Imports into the Community or exports a certificate of advance fixing of the therefrom . . . shall be subject to the levy, customs import formalities;

(b) in the case of an export licence or of Duplicates may not be submitted for a certificate of advance fixing of purposes of carrying out import or the refund, the customs export export operations." formalities relating to: Article 20 (1) of that regulation provides: Exportation from the Community, or "Where as a result of force majeure importation or exportation cannot be effected during the period of validity of After attribution of the quantity and the licence or certificate, the competent endorsement by the office referred to in agency of the issuing Member State shall the preceding subparagraph, Copy No 1 decide, at the request of the titular of the licence or certificate shall be holder, either that the obligation to returned to the party concerned." import or export be cancelled, the security being released, or that the Article 17 (2) of the same regulation period of validity of the licence or certi- provides: ficate be extended for such period as may be considered necessary in view of "Release of the security shall be subject the circumstances invoked. Such to production of proof: extension may be granted after the period of validity of the document has (a) as regards imports, of completion of expired. customs formalities as referred to in Article 9 (3) (a) relating to the product concerned; 5. Regulation No 2727/75 provides for (b) as regards exports, of completion of the charging of an import levy (Article customs formalities as referred to in 13) and the grant of export refunds Article 9 (3) (b) relating to the (Article 16), the refunds being designed product concerned; furthermore, in to cover the difference between the case of an export from the Community prices and prices on the Community . . . proof shall be world market, which are generally lower. required that the product has, within 45 days from the day of completion The levy to be charged and the refund to of customs export formalities (force be granted are those applicable on the majeure excepted), as the case may day of importation and on the day of be either left the geographical exportation respectively (Regulation No territory of the Community... or 2727/75, Articles 15 (1) and 16 (3)). reached its destination . . . . " However, both the levies and the refunds Article 17 (7) of Regulation No 193/75, applicable on the day on which which is the provision at issue in this application for a licence is lodged, case, is worded as follows: adjusted on the basis of the threshold price which will be in force during the "Where a licence or certificate or extract month of importation or exportation, are therefrom is lost, issuing agencies may, to be applied to an import or an export exceptionally, supply the party concerned to be effected during the period of with a duplicate thereof, drawn up and validity of the licence, if the applicant so endorsed in the same way as the original requests when applying for the licence document and clearly marked with the (Regulation No 2727/75, Articles 15 (2) word 'Duplicate' on each copy. and 16 (4). Further, the refund may be

fixed by means of the tendering On hearing the report of the Judge- procedure (Article 5 of Regulation No Rapporteur and the views of the 2746/75 of the Council of 29 October Advocate General, the Court decided to 1975 laying down general rules for open the oral procedure without any granting export refunds on cereals and preparatory inquiry. criteria for fixing the amount of such refunds (Official Journal L 281, p. 78, 1975). II — W r i t t e n o b s e r v a t i o n s sub- m i t t e d to the C o u r t The refund is generally payable on proof being furnished that the product in respect of which customs export A — 1. Pardini submits that Article 17 formalities have been completed has been (7) of Regulation No 193/75 relates exported from the Community (Article 8 solely to a trader who, having lost a of Regulation No 2746/75; Article 4 licence or certificate, does not wish to of Regulation No 192/75 of the perform the obligations arising ther- Commission of 17 January 1975 laying eunder, whilst at the same time seeking down detailed rules for the application to obtain the release of the security. On of export refunds in respect of agri- the other hand, the case of a trader who cultural products (Official Journal L 25, wishes to carry out the transaction in p. 1, 1975). In order to obtain that spite of the loss of the licence or certi- payment the trader concerned must ficate is dealt with only in Article 20 of submit a written application to the the régulation, and only in a general competent agency of the Member State manner, no specific provision being in whose territory customs export made for that case. formalities were completed. The documents relating to the payment of the refund must be submitted within the six Pardini considers that that interpretation months following the date in which is confirmed by the fact that the customs formalities were completed, problems created by the loss or theft of except in cases of force majeure (Regu- such a document may easily be avoided. lation No 192/75, Article 13). In fact, it emerges from Article 3 of Regulation No 193/75 that in the event 6. The order from the President of the of the loss of a licence or certificate Tribunale di Lucca making the reference made out in the holder's name no one was received at the Court Registry on may use that document or transfer the 3 December 1979. rights arising thereunder to third parties without the prior intervention of the In accordance with Article 20 of the undertaking in whose name the Statute of the Court of Justice of the document is made out and without the European Economic Community written express agreement of the issuing agency. observations were submitted by the plaintiff in the main proceedings, the Therefore the only possibility, in this flour miller Fratelli Pardini S.p.A., case, open to an undertaking other than represented by G. M. Ubertazzi and M. the holder, wishing to commit a fraud, Capelli of the Milan Bar, and by the would be to falsify the licence or cer- Commission, represented by its Legal tificate by forging an application for the Adviser A. Wainwright, assisted by G. transfer thereof purportedly coming from Berardis, a member of its Legal the holder and the endorsement of the Department. issuing agency recognizing the transfer

of the rights. Provisions to deal with 2. In any event, it is argued, Article 17 such a situation are already laid down in (7) of Regulation No 193/75 does not Articles 15 and 16 of the regulation. deal with the case of theft. After examining in particular Articles 1256, 1257, 1780, 2016 and 2743 (3) of the Italian Civil Code, as well as Article 89 of the Legge Cambiaria [exchange According to Pardini, it is unlikely that control law], Gazzetta Ufficiale No 292 the certificate could be used twice by its of 19 December 1933, and Article 69 of titular holder: in fact, it is argued, the the Legge Assegno [law on bank latter would have had to carry out a first cheques], Gazzetta Ufficiale No 300 of exportation, on the basis of the original 29 December 1933, Pardini observes that document falsely declared to be stolen, Italian law makes a distinction between loss, misappropriation, including theft, from a Member State of the Community and destruction, and it notes that Italian other than Italy, applying to the law concurs in this respect with that of competent agency of the said State for the other Member States and, further, payment of the refund; then, after with their sources in Roman law. requesting in Italy a new document to replace the stolen one, it would have had to carry out a second exportation, this time from Italy, on the basis of the new certificate, making a fresh application to the Italian agency for payment of the In its opinion, the meaning of the term refund. Thus it would have had to report "loss" occurring in Article 17 (7) of the theft of a certificate, thereby causing Regulation No 193/75 cannot be a criminal investigation to be initiated, extended to theft. Literally, the verb "to whilst submitting, immediately after- lose" means in fact "to mislay", even if wards, two applications in its name to in ordinary usage it is sometimes used in the two competent agencies for payment a more general sense. of the refunds, in spite of the certainty that a routine check of the registers would be sufficient to detect the fraud. Further, the derogative nature of Article 17 (7) requires that that provision be construed narrowly. All the legal systems envisage the reproduction of documents Pardini emphasizes that the Commission and ascribe to copies of documents has admitted that so far not a single case essentially the same effect as to the has occurred in which a licence or cer- original, even if the nature of certain tificate declared lost or stolen has been documents may per se impose limits upon used twice. their reproduction or preclude copies having the same value as the originals. In this regard Pardini refers to Article 212 of the Italian Code of Civil Procedure as well as to Article 162 of the Code of It further contends, in this context, that Criminal Procedure and Article 86 of the it is possible to establish at the present Legge Cambiaria. In this context the stage that the licence which was stolen limitations upon the effects of repro- from it has not been used and that it can duction which are laid down in the first no longer be used since it expired on 31 and second subparagraphs of Article 17 October 1979. (7) are in the nature of an exception or a

3. As regards the validity of the disputed provision, Pardini observes in the first place that the rules on export According to Pardini, the requirements refunds make a distinction between the of good management in relation to a administrative act of granting author- system of certificates, the function of ization and the document which gives it which is to ensure that the holders physical form, namely the certificate. It thereof fulfil all the conditions imposed points out that the general lines of the in order to obtain the right to export, do licensing system are governed by not entail the extinction of that right in measures of the Council and that the the case of persons who have lost cer- task of adopting implementing measures, tificates or from whom they have been including inter alia the rules dealing with stolen. In this regard it is sufficient to the validity and the form of certificates, consider the practice common to the has been delegated by the Council to the legal systems of the Member States, not Commission. only in the field of certificates, but also in the field of documents attesting the existence of a debt. In Pardini's opinion, it is impossible for implementing provisions to go so far as to determine which facts extinguish the basic rights of exporters. In this regard, With regard to the objective of it is indeed significant to note that in preventing a certificate from being used order to delegate to the Commission the twice, Pardini considers that to treat the authority to adopt provisions governing loss and/or the theft of the certificate as the duration of the validity of licences or entailing the extinction of the right to certificates, it was considered necessary the refunds connected with the export to do so by express terms in the regu- document is disproportionate. The risk, lations of the Council. of improper conduct should in fact be

2. The Commission points out that the loss of the licence or certificate does not Finally, Pardini 'points out that the prevent the import of any given goods: if principle of proportionality is closely the document issued initially can no connected with the prohibition on longer be submitted the trader may at discrimination. If the aim of Article 17 any time request a new document, which (7) is to prevent abuses, that rule, as will normally be issued to him. That will interpreted by the Commission, itself enable him to carry out the import or constitutes a source of abuse to the export in exactly the same way as the advantage of a trader who does not wish original document, subject to the prior to perform the obligations arising under lodging of a further security. However, the licence or certificate. In fact, it is the amount of the levy or refund, the only too easy for such a trader to declare Commission adds, will be that in force the document lost and then rely on on the day of the transaction, unless it is Article 17 (7) in order to request the again fixed in advance for a further release of his security. period.

JUDGMENT OF 26. 6. 1980 — CASE 808/79

4. The Commission submits that the issue of a duplicate in place of the In order to ensure that an original original licence or certificate would licence which does not contain any constitute a virtually uncontrollable advance-fixing of the levy or refund and source of fraud, even without taking into which a trader declares lost, has not account the cases in which such been, and will not be, used, the check documents might be forged by third would likewise have to take place in parties. In fact, the issue of a duplicate several hundreds of different customs would enable a dishonest trader to carry offices. out an import or export transaction twice over. The Commission states that for ten years there has been discussion at the Community level about the controls The Commission emphasizes that where necessary to prevent such frauds, but it is subsequently established that a that the only valid system offering trader has imported or exported twice sufficient guarantees is that provided for over the quantity to which he was by Article 17 (7) of Regulation No entitled the economic situation cannot be 193/75. redressed.

Further, it is necessary to prevent any According to the Commission, the possibility of an original licence or cer- supervision recessary to ensure that a tificate or duplicate being used in a way rate of levy or refund fixed in advance which would distort the statistical data to has not been applied twice over requires be taken into consideration in order to a gigantic administrative effort which the secure the sound and proper man- Member States have always unanimously agement of the markets. declared impossible. As regards export refunds the checks would have to be repeated nine times because the grant thereof is centralized in the hands of a On the basis of these considerations, it single authority in each Member State. seems to the Commission that the In all the Member States the tens of reference by the national court to the

5. With regard to the last part of the second question submitted by the court 2. Consideration of the provision in requesting the preliminary ruling, the question has disclosed no factor of Commission states that Regulation No such a kind as to affect its validity. 193/75 does not by any means constitute an infringement of the Council's basic regulation providing for the grant of refunds. In fact Article 17 (7) satisfies a need for effective control, which belongs III— Oral procedure to the sphere of detailed implementing rules expressly entrusted by the Council to the Commission; doubtless the Council did not want the refunds to be 1. At the sitting on 24 April 1980 oral granted without effective safeguards argument was presented by the Italian against fraudulent activities. Further, Government, represented by A. there is no question of a penalty either. Marzano, Avvocato dello Stato, acting as In fact, a penalty presupposes, on the Agent, by Fratelli Pardini, S.p.A., part of an individual, unlawful conduct represented by M. U. Ubertazzi and F. which automatically incurs a reduction in Capelli of the Milan Bar, and by the that person's financial assets. In this case, Commission, represented by G. Berardis, it is a question, on the contrary, of the a member of its Legal Department. specific expression of an imperative need for control which must necessarily be performed by the Commission within the framework of the powers delegated to it 2. The Italian Government, which had by the Council. The method chosen has, not submitted written observations, after various attempts, proved to be the expressed serious doubts at the hearing only suitable one and it has so far about the admissibility of the reference enabled the system regulating imports for a preliminary ruling, both because of and exports to function satisfactorily. a dispute on which the national court The Commission's efforts, which will had to give a decision and because of the continue, to find an alternative method inappropriate nature of the proceedings of control have unfortunately foundered pending before that court for leading to upon harsh economic and administrative the conclusion that the questions raised realities. needed to be dealt with as preliminary issues. In this regard, it pointed out that Pardini had obtained an interim measure from the Pretore of Lucca. According to Consequently, the Commission suggests the Italian Government, Pardini should that the following answers be given to before 30 January 1980 have asked the the preliminary questions: court before which the main proceedings are pending to declare that it was entitled to obtain a new export certificate on the same terms as the previous one, 1. Article 17 (7) of Regulation No but it did not do so. Consequently, the 193/75 must be interpreted as interim measure is nugatory and so the meaning that it precludes the issue of preliminary questions submitted cannot a duplicate having the same value as be of any consequence except in the

context of proceedings on the substance examination of whether the rule is of the case. reasonable must take account of the possible consequences resulting from the The Italian Government further observed application of a different basic criterion in this context that the export certificate and that it must not be governed by the constitutes an administrative measure damage alleged in each case by the and not a document attesting the trader. existence of a debt, the cancellation or payment of which may be authorized, Finally, the Italian Government observes that the court cannot take the place of that the restrictive wording of the the administrative authorities so as to Community rule does not leave any issue export licences or certificates and margin of discretion. to the competent that the right to the refund has its origin national authorities allowing them to in the exportation and not in the appraise the principle laid down by the possession of the export document. rule or a fortiori to derogate from it so that it is not possible to reproach the Italian authorities in any way or to According to the Italian Government the impute any responsibility whatsoever to letter and spirit of Article 17 (7) of Regu­ them. That is even more apparent, lation No 193/75 leave no doubt about according to the Italian Government, if it the necessity of precluding the possible is borne in mind that the Italian author­ use of duplicates for the export ities contacted the competent Com­ transaction. munity authorities and followed the interpretation given by them. In its opinion the reference to the "loss" of a document should be construed as referring only to its being mislaid; and it 3. In reply to a question from a is not possible to accept a distinction member of the Court, Pardini stated that according to whether the trader does or it was not the practice to insure against does not intend to proceed with the the loss or theft of licences or certificates exportation. Further, it has no doubt that and that it had not taken out insurance the public interest in ensuring that the because it did not imagine that by losing trade in goods operates properly, that a licence it would lose all entitlement to obligations to import or export are the refund. performed in their interest and that controls are carried out, must prevail over the interests of the individual trader. 4. The Advocate General delivered his Similarly, it considers it certain that an opinion on 22 May 1980.

3 Under Article 12 of Regulation No 2727/75 of the Council of 29 October 1975 on the common organization of the market in cereals (Official Journal L 281, p. 1), imports into the Community or exports therefrom of any of the products listed in Article 1 are subject to the submission of a licence valid throughout the Community, the issue of which is conditional on the lodging of a deposit guaranteeing that importation or exportation will be effected during the period of validity of the licence. According to the twelfth recital in the preamble to that regulation the system of issuing licences must enable the competent authorities "to follow trade movements in order to assess market trends and to apply the measures laid down in this regulation as necessary". Further, where the levy or refund is fixed in advance, the fixing must, according to Article 12 of the regulation, be noted on the licence, which serves as supporting document for the advance fixing. It follows that advance fixing certificates may be of very great importance when the rate of the levy or refund applicable on the day of the transaction differs appreciably from the rate fixed in advance.

4 Article 12 (2) provides that the period of validity of licences and other detailed rules for the application of that article shall be adopted in accordance with the procedure known as the Management Committee procedure. It is by virtue of that provision and the corresponding provisions contained in the regulations relating to other agricultural products that the Commission adopted Regulation No 193/75, to which reference has been made above, Article 17 (7) of which provides:

6 In this regard, it is also necessary to cite the judgment of 30 January 1974 in Case 158/73, Kampffineyer vEinfuhr- und Vorratsstelle für Getreide und Fut- termittel[1974] ECR 101, where, in reply to preliminary questions submitted in the context of a dispute concerning the release of the security following the loss of a licence, the Court held that "the loss of an import licence constitutes a case of force majeure within the meaning of Article 18 of Regu- lation No 1373/70 (the provision corresponding to Article 20 of Regulation No 193/75) when such loss occurs despite the fact that the titular holder of the licence has taken all the precautions which could reasonably be expected of a prudent and diligent trader". It is therefore settled that if the titular holder cannot perform the transaction as a result of the loss of the licence in such circumstances he may obtain the release of the security. Further, he may, in accordance with the general rules, obtain a fresh licence, where

PARDINI

appropriate with a fresh advance fixing, but at the rate applicable on the date on which the application for the fresh licence is submitted.

T h e i n t e r p r e t a t i o n of A r t i c l e 17 (7)

7 The first question submitted by the court requesting a preliminary ruling is as follows:

"Must the first and second subparagraphs of Article 17 (7) of Regulation No 193/75 be interpreted as meaning that an exporter who has suffered the theft of an export licence or certificate, valid throughout the Community, fixing in advance the amount of the refunds, may not request and obtain a new licence or certificate or equivalent document issued by a national authority permitting him to carry out the export operations before or after the expiry of the period of validity of the stolen document, thus suffering the total loss of the refunds fixed in advance under the said document?"

1 1 The construction of the term "loss" in Article 17 (7) must take into account the function which that paragraph performs in the Community licensing system. Under that system, the licence or certificate must actually be submitted not only for the performance of each transaction, but also for the release of the security (Article 17 (2) and (3)). If the document is lost after the performance of the transaction, the duplicate issued by virtue of Article 17 (7), endorsed by the office where customs formalities were completed, may be used to obtain the release of the security. Similarly, in the event of a theft occurring after the transaction has been carried out, the possession of a duplicate is necessary in order to release the security. Thus there is no reason for not including that case within the scope of the first subparagraph of Article 17 (7). Whilst the issue of a duplicate which serves solely to release the security cannot lead to a licence or certificate being used twice, the situation would be quite different in the case of a duplicate capable of being used in order to carry out the transaction itself. There can be no assurance that the transaction has not already been carried out on the basis of the lost document. If the transaction has not yet been carried out, and if the period of validity has not yet expired, the lost document may in principle be produced throughout the Community for the purpose of carrying out the transaction. That is why the second subparagraph of Article 17 (7) provides that the transaction cannot be carried out on the basis of a duplicate. The problem arises in the same way in the case of a stolen licence or certificate. Therefore it is necessary to interpret the second subparagraph, in view of its purpose, as including cases of theft.

1 4 It must be pointed out in the first place that the provisions in question cannot be regarded as imposing a " penalty", in the proper sense of the term, upon a trader in the event of his licence or certificate being lost. In fact, it is necessary to appraise the consequences which the Community legislature has attached to the loss of such a document, irrespective of the cause of the loss in each individual case and regardless of the liability which the trader concerned may incur. In this regard, the national court indicates, by the very wording of its question, the two considerations which led it to question the validity of the disputed provision: the issue of proportionality and that of the possible limitations placed upon the power which the regulation confers upon the Commission.

15 As regards the latter aspect, the plaintiff in the main proceedings makes a distinction between the right to carry out an import or export transaction and the document which attests that right. The former, it is argued, is governed by the regulations of the Council, whilst they in turn empower the Commission to settle questions of form and lay down detailed implementing rules in relation to the document. In this regard, it is significant to note that in order to delegate to the Commission the power to determine the period of validity of licences, it was considered necessary to do so in express terms.

JUDGMENT OF 26. 6. 1980 — CASE 808/79

Therefore, it is said, the Commission is not empowered to prescribe that the loss of the document shall entail the extinction of the right.

17 In order to determine whether the disputed provision is compatible with the principle of proportionality, it is first of all necessary to ascertain the aims of the regulations in question. As the Court has already had occasion to emphasize with regard to the system of lodging security, it is necessary for the authorities entrusted with the management of the common organization of the markets to have available precise forecasts on future imports and exports. Whilst that objective requires that the performance of the under- taking to 'export or import in accordance with the licences or certificates issued be ensured by appropriate means, it also makes it necessary to see that the documents are used only for the transactions covered thereby. In the case of advance fixing certificates, that need is all the more imperative since the use of such certificates twice may confer unjustified benefits upon traders and thus impose heavy financial burdens upon the Community.

PARDINI

18 In this regard, the prohibition contained in Article 17 (7) upon carrying out the transaction on the basis of mere duplicates constitutes a measure which is both simple and effective. On the other hand, from the trader's point of view that prohibition entails the risk of losing, even through no fault of their own, the benefits attached to the original certificates.

21 In the circumstances it is necessary to examine the situation of traders under the rules in force. In the first place, the risk borne by them derives from the system of advance fixing, which was created in the interests of trade and which in normal cases gives traders considerable benefits. If by requesting advance fixing traders take advantage of those benefits, it is therefore just that they should bear the disadvantages which arise from the necessity, on

JUDGMENT OF 26. 6. 1980 — CASE 808/79

the part of the Community, of preventing any abuse. In particular, it is reasonable to expect the titular holders of licences or certificates to take the greatest possible care of them and to insure against the risks which cannot be eliminated, to the same extent to which they insure against other commercial risks.

22 For those reasons, the risk borne by traders as a result of the provision contained in Article 17 (7) of Regulation No 193/75 is not disproportionate in relation to the need for control.

23 It is therefore necessary to state in reply to the second question that consideration of the provision in question has disclosed no factor of such a kind as to affect its validity.

Costs

licence or advance fixing certificate may not obtain a new licence or equivalent document permitting him to carry out the export operations on the conditions laid down in the stolen licence or certificate.

2. Consideration of the provision in question has disclosed no factor of such a kind as to effect its validity.

Kutscher O'Keeffe Touffait Mertens de Wilmars Pescatore

Mackenzie Stuart Bosco Koopmans Due

Delivered in open court in Luxembourg on 26 June 1980.

A. Van Houtte H. Kutscher Registrar President