C-108/81

JUDGMENT OF 30. 9. 1982 — CASE 108/81

provisions of that aniele, is to define does not prevent the Council from own resources allocated to the creating a levy such as the one Community budget and not to imposed on the production of stipulate the Community institutions isoglucose where the power of the which are competent to impose duties, Council to create that levy has its taxes, charges, levies or other forms basis in the provisions of the Treaty of revenue. As a measure adopted relating to the common agricultural under budgetary law, that decision policy.

In Case 108/81

G. R. AMYLUM, a company incorporated under Belgian law, having its registered office at 479 Avenue Louise, Box 57, 1050 Brussels, represented by Michel Waelbroeck, advocate, a member of Liedekerke, Wolters, Wael- broeck & Kirkpatrick, 341 Avenue Louise, 1051 Brussels, with an address tor service in Luxembourg at the Chambers of Ernest Arendt, advocate, 34 Rue Philippe-II,

applicant,

v

Advocate General: G. Reischl Registrar: H. A. Rühi, Principal Administrator

gives the following

JUDGMENT

Facts and Issues

The facts of the case, the course of provisions offended against the general the procedure and the conclusions, principle of equality (in that case as submissions and arguments of the parties between sugar producers and isoglucose may be summarized as follows: producers). The Court added, however, that the ruling left the Council free to take any necessary measures compatible with Community law for ensuring the I — Facts and w r i t t e n p r o c e d u r e proper functioning of the market in sweeteners. A — Background to the dispute 2. Following that judgment, on 25 June 1. By a preliminary ruling of 25 1979 the Council adopted, on the basis October 197S given in Joined Cases of a proposal for a regulation drawn up 1C3 and 145/77 Royal Scholten-Homg bv the Commission, Regulation No (Holdings) Limited v Intervention Board 1293/79 (Official Journal L 162, p. 1C, for Agricultural Produce; Tunnel with corrigendum in Official Journal Refineries Limited v Intervention Board L 176. p. 37) amending Regulation No for Agricultural Produce [1978] ECR 2:37 1111/77. That regulation entered into the Court of Justice held that Council force, pursuant to Anicie 5 thereof, on Regulation No 1111/77 of 17 May 1977 1 July 1979 h u n g down common provisions for isoglucose * as invalid to the extent to which Articles S and 9 thereof imposed a 3 Regulation No 1293/79 amended production lew on isoglucose of five Regulation No 1111/77 m the light of unus of account per ICC kg of dry tne judgment of the Court of Justice of matter for the period corresponding to 25 October 1978 In view of the fact that the sugar marketing year 1977/78. The the most appropriate means for avoiding Court stated, in fact, that the system inequality of treatment was to subject established by the above-mentioned isoglucose production to rules analogous

4 Bv separate judgments of 29 October the statement of the grounds upon which 1980'delivered in Case 138/79 SA the judgment was based, the Court Roquette Frères v Council of the European rejected all the substantive arguments Communities [198C] ECR 3333 and Case adduced against the system of pro- 139/79 Maizena GmbH v Council of the duction quotas introduced by that regu- European Communities [198C] ECR lation and in particular against the basic 33°3. the Court declared Regulation No quotas fixed for the applicants in the two l2 Q 3/79 to be void tor infringement of cases. essential procedura! requirements on the ground thai the regulation had been 5. Bv Council Regulation (EEC) No adopted on 23 June 19*5 m the absence 1592/80 of 24 June 1980 (Official oi the Parliament's opinion required by Journal L 160, p. 12), which was adopted Anide 4 3 of the Treaty, on the proposal while Cases 138/79 and 139/79 were »hich had been referred to the Par- pending before the Court, the Council lameni on 1«> March 1979 However, in declared that the system of production

AMYLUM v COUNCIL

JUDGMENT OF 30. 9. 1982 — CASE 108/81

Commission requested the Court to allow 2. In its defence the Council of the it to intervene in support of the Council. European Communities contends that the Court should dismiss as unfounded the By order of 30 September 1981 the application brought by the applicant and Court, on hearing the views of the order the applicant to pay the costs. Advocate General, decided to accede to the Commission's request to intervene. 3. In its intervention the Commission By intervention received at the Court supports the conclusions of the Council Registry on 17 November 1981 the seeking. Commission maintained that the Council's position was well founded. (a) the dismissal of the application;

AMYLUM v COUNCIL

principle that laws may not be retroactive IRCA v Amministrazione delle Finanze by re-instating the quota and levy system dello Stato [1976] ECR 1213, 111/63 for the production of isoglucose during Lemmerz-Werke v High Authonty [1965] the marketing year 1979/80. ECR 677 and 98/78 Račke v Haupt­ zollamt Mainz [1979] ECR 69). That general principle is embodied in However, although the Court, according most of the legal systems of the Member to the applicant, had never had to States of the Community and therefore, pronounce upon the lawfulness of true as the Court acknowledged in its retroactivity, its judgments in Cases judgment in Case 17/67 Neumann v 100/63 Kahbeek v Sociale Verzeke­ Hauptzollamt Hof [1967] ECR 441, ringsbank [1964] ECR 565 and 88/76 applies to Community institutions when Société pour l'Exportation des Sucres SA v they draft legislation. Commission [1977] ECR 709 might allow According to the applicant all the the conclusion to be drawn that the national legal systems and the Com­ general rule is to preclude Community munity legal order distinguish "true" regulations from having retroactive retroactivity (application of a legislative effect. Moreover, the applicant considers measure io a transaction completed that the fact that the Court has entirely in the past) from "material" retr­ recognized retroactivity in the sphere of oactivity (application of a legislative monetan· compensator}· amounts does measure to the future consequences of not amount to an acknowledgement of situations which came into existence the lawfulness of retroactivity in general, under an earlier law) to establish in in view of the fact that the retroactive principle the prohibition of true retro­ effect conferred, for a short period, on activity. the regulations relating to monetary compensatory amounts is indispensable In fact, derogations from the principle of to the whole system of that machinery. the prohibition of retroactive legislation As such, that effect might thus be are generally more apparent than real described as a "false exception" to the and concern only a limited number principle of the non-retroactivity of of cases such as interpretative or Community measures. declarator)· laws.

protected. In that connection it is not have retroactive effect where the will of sufficient that draft legislation has been the legislature to that effect is clearly made public; according to that case-law, expressed. On the other hand the courts there must necessarily be a decision of and tribunals are particularly vigilant the legislature, that is to say a vote by against the retroactivity of orders and the Bundestag [Lower House] in favour regulations, save in the case of express of the adoption of a retroactive law. legislative authorization. Moreover, the Bundesverfassungsgericht has "particularly insisted" on the need to safeguard the principle that fiscal On that point the applicant concludes legislation may not be retroactive. that, in the absence of effective par­ According to the applicant, contested liamentary control over the legislative Regulation N o 387/81 comes close to or "quasi-legislative" activities of the being a fiscal law since it introduces a Council it is particularly important that production levy on isoglucose which is the Court's power of review be exercised "parafiscal" in nature. in the widest possible manner. For that reason the applicant considers that the The Bundesverfassungsgericht certainly Court, by virtue of its judgment in Case allows a number of exceptions to the 4/73 Nold v Commission [1974] ECR principle that legislation may not be 491, in exercising that review, is bound retroactive ' but in the present case none to draw inspiration from the con­ of those exceptions may be relied upon stitutional traditions common to the to sanction the flagrant breach by the Member States and to "apply the Council of the principle that legislation maximum standard of protection recog­ may not be retroactive. In any event it nized by national constitutional laws". cannot be denied that respect for the principle that legislation imposing charges may not be retroactive is ensured In that respect the applicant observes with "exceptional vigilance" by the that the Treaty, by instituting two Bundesverfassungsgericht. specific rights of action, namely the action for failure to act under Article 175 Apan from Norway where Article 97 of and proceedings for nullit)' under Anicie the Constitution expressly prohibits the 173 the Treaty did not wish to assimilate retroactivity of laws in civil matters, the the Council to a "legislature". The right legal systems of other countries in enjoyed by those concerned directly to Europe admit of the principle that challenge the legislative activity of the legislation may not be retroactive only in Community is intended to compensate an attenuated form in the sense that, in for the inadequacy of a parliamentary the absence of a constitutional court, the review of the Council's activities and courts are powerless to combat the confirms the need to subject the Council retroactivity of legislation. Consequently, to a degree of judicial review which is as savf m fiscal matters where the principle wide as that exercised at national level that legislation mav not be retroactive is over the exercise of the power to issue sacrosanct, legislation is permitted to regulations.

First it cannot be said that the retro- it the dau which it needs for reference activity of Regulation No 387/81 is purposes such as the production quotas justified by overriding considerations of of previous years. In fact, it falls within public interest requiring the legal vacuum the discretionary powers which the resulting from the nullity of Regulation Court has recognized the Council as No 1293/79 to be filled. In fact that enjoying in the management of the legal vacuum had no harmful effect on common agricultural policy to be able to the Community public interest since re-assemble those data. Regulation No 1293/79 remained applicable until its nullity was pro- nounced by the Court.

The producers. The applicant's production applicant states that, in the context of an capacity which had already been action for nullity, such considerations are restricted by the quotas mandatorily immaterial; for its action to be admissible fixed by the Council, could only be it is sufficient if the applicant can show a increased by the introduction of new legal interest and, for the measure to be production investment. No such project declared void, it is sufficient if the is however envisaged since the measure reveals defects of such a nature production capacity has already been as to call in question its validity.

It was retroactive effect to Regulation No unabie to obtain compensation for that 387/81 whilst that possibility was not damage since the action which it brought envisaged bv the Council when it in Case I 16/77 was dismissed (judgment adopted Regulation No 12*}/"* of b December 1979) succeeding Regulation No 1111/77 which had been declared invalid b\ the Court At the verv least it is excessive to maintain, as doe* the Council, tnjt it Regulation No 3S7/SI *ere not to be F:nalK. u is also wrong to claim that retroactive the legalus ot tne rules reimbursement of tne levy paid would governing isoglucose production would increase the share ot the lesy imposed on be undermined and the Council tor that sugar producers Bv virtue of Anicie 27 reason would no longer have available to <3i ot Regulation No 333C/74 of the

Council of 19 December 1974 (Official the period prior to the entry into force Journal L 359, p. 1) the B sugar levy of Regulation No 387/81 would be could not in any event exceed 30% of contrary to the very principle of the intervention price, or, for the declarations of nullity by the Court. A marketing year 1979/80 in question, declaration by the Court of the nullity of 12.33 European currency units (ECU) a measure has precisely the effect, under per 100 kg. Since the levy for that period the first paragraph of Article 174 of the was fixed bv Article 1 of Council Regu- EEC Treaty, of rendering the contested lation No 3103/80 of 28 November 1980 measure "void"; the contested measure (Official Journal L 324, p. 62) at 12.3 could not therefore have had the effect ECU per 10C kg, an increase in the latter of a warning to the applicants as regards would be impossible given that the their legitimate expectation. principle of co-responsibility, which enables the B sugar levy to be increased in respect of the following year where the levy for the year in progress is Furthermore, the existence of Regulation insufficient to cover the losses incurred, No 1293/79 was not in itself a factor of was onlv introduced with effect from such a nature as to alen traders to the 1 July 1981 bv Anicie 28 (3), (4) and (5) retroactive adoption of a new regulation, of Council Regulation No 1785/81 of any more than was the publication on 30 June 1981 (Official Journal L 177, 20 December 1980 — that is to say p. 4). several months after expiry of the 1979/80 marketing year — of a proposal by the Commission nowhere indicating, according to the applicant's analysis, the legislature's intention to adopt a regu- On the other hand, it cannot be said that lation having retroactive effect. On the compliance with the judgment of the contrary, the legitimate expectation of Court declaring Regulation No 1293/79 the traders was bolstered by the fact that void required the Council to make Regu- the Council did not intend to confer lation No 387/81 retroactive. Regulation retroactive effect on Regulation No No 1293/79 was indeed declared void 1293/79 even though that was, on a ground of external illegality which did not affect the Council's ability to re- according to the Council itself, legally adopt the substance of the regulation conceivable. declared void. No inference may, however, be drawn from the judgment of the Court that the new regulation was to have retroactive effect. (d) On the contrary, it must be stated that, by arrogating to itself the power to make Regulation No 387/81 retroactive, the Council gravely disregarded the authority of the European Parliament Finallv, it is » rong io take the vie» that and the Coun of Justice. tne retroattive eftect conferred on Regu- lation No 3K"/M did not frustrate the leqmmate expei.:.):ion of isoplucose- nroducmg unaenaKings To accept that traders in that sector »ere warned, bv By re-adopting, with retroactive effect, a the existence of Regulation No 1293/79. measure identical to the one declared of the legislature's intention to institute a void for failure to consult the Par- s\ stem oi quotas and levies in respect of liament, the Council is reducing the duty

The Council could not, in the present case, adopt retroactive legislation with- In the applicant's view, the decision to out infringing the second paragraph of make Regulation No 387/81 retroactive Anicie 174 of the Treaty according to was thus taken merely on the basis of which it is for the Court to determine considerations of political expediency the temporal consequences of its without the legislature's concerning itself judgment of nullity. Since the Court, in with respect for fundamental rights and declaring Regulation No 1293/79 void, the legal certainty of the traders did not make use of that power the concerned. Such an attitude has the Council could not revive, by means of effect of removing all efficacy from the Regulation No 387/81, the system laid judgments of nullit}· given by the Court, down by Regulation No 1293/79, in creates a situation of permanent legal respect of which the declaration of uncertainty and confers on the Council, nullity by the Coun meant that it was in defiance of the law, a discretionary deemed never to have existed. power to decide whether to confer retroactivity on measures adopted by it, whenever a measure, which has been declared void, has existed in that sphere. In that respect it is no: possible to put forward, as (he Council, not without some contradictions attempts to do, arguments as to the nature of the 2 The Council of the European measure declared void bv the Coun. as Communities, the defendant, considers to «.nether it is an individual or peneral for us pan mat the case-law of the Coun measure, or as to whether the authority clearK demonstrates, in particular in its responsible tor the measure is a luaemem in Case 98/78 Racke [1979] legisiati\e or administrative one. in order EC R t)9 at paragraph 22 that retroactive to seeK to iimit the effects of the decision Communis measures are bv no means ucearme Regulation No 2°3·''79 void excluded as a matter of principie. Ir iac: Communitv lau, in tne same wav However, the Court has sought to make as national laws, embodies the principie retroactive Communitv measures subiect of the prohibition of the retroactive to ludiCiai review to ensure that they application at measures imposing cnarges obsen c in particular the following on cm/ens and requires the authors of conditions

(a) first, the protection of legitimate advisability from the point of view of expectation on the pan of those policy" the Council declined to adopt concerned where such expectation is that solution and adopted instead Regu- present; lation No 1293/79 whose substantive conformity with Community law was clearly upheld by the Court in its (b) secondly, the retroactivity of the judgment in Joined Cases 138 and legislation must be necessary so as to 139/80. Indeed, by that decision the satisfy the aim pursued by the Court, it is true, annulled Regulation No legislation in question or to meet a 1293/79 for infringement of essential need overriding general interest. procedural requirements but rejected all the substantive complaints alleged by the applicants against the principle of a levy The Council considers that these imposed on the production of isoglucose. conditions as defined have been observed The legality of the principle and the in the present case. procedural steps taken by the Council were thus consistently confirmed and the Council was therefore entitled to re- (a) There can be no legitimate introduce the disputed levy with retro- expectation on the part of the applicants active effect to the marketing year in view of the circumstances in which 1979/80. Regulation No 1293/79 was declared

Community. legislative activitv (cf. Regulations Nos 1111/77, 1293/79, 1592/80 387 and 388/81) and in the attitude adopted The "mixed" nature of the contested by the Community institutions. The regulations explains why the Court did existence of legitimate expectation on the not seek to limit the temporal effects of pan of isoglucose producers of the its declaration that, on the ground of abolition, as regards the past, of the infringement of essential procedural regulations relating to isoglucose would requirements, Regulation No 1293/79 tnus only be conceivable if the Court had was void. Indeed it is clear from the condemned that policy in principle.

retroactive effect. For "reasons of sufficient to support the Council's view

The Council therefore did not fail to In those conditions the Council considers comply with its duty under Anicie 176 of that neither de /acto nor de jure was there the EEC Treaty and cannot be accused any legitimate expectation worthy of of having frustrated a legitimate ex- protection. In its judgment in Cases 138 pectation which was entirely non-existent and 139/80 the Court not only rejected since those concerned, who as prudent all the substantive allegations made traders were fully informed of the against the measures adopted by the Community's action in the isoglucose Council but it also added that those sector, had been warned both in law and measures were fully justified during the in fact of the unequivocal intention of marketing year 1979/80 and invited the the institutions to pursue their policy of Council to takq all appropriate measures regulating the sector in question. In in the isoglucose sector. For that reason particular, the attitude of the legislature the Council takes the view that it cannot had been made abundantly clear by be claimed that it has failed in its dutv to the publication on 22 December 198C complv with the judgment of the Court (Official Journal C 334, p. 2) of the within the meaning of Article 176 of the Commission's proposal drawing the consequences of the judgment declaring EEC Treaty. Regulation No 1293/79 void, whereby the Commission declared itself to be in favour of the adoption with retroactive effect, of the measures adopted by the In the Council's view, the obligations Council in the form of Regulations Nos resulting trom a ludgment that a measure 3S" and 3SS/S1 is void are to be con>trurJ m coniunction with the ground upon *hich the nullitv was pronounced In tnr present case the Council's dut\ u as. in the actual terms of the luüqmeni For all those reasons the Council declaring Regulation No \29}/7* void, consiüers that it has not defied the to obsene the Parliament's right to be authontv oí the Court or the powers of consulted in the matter The latter. b\ its tne Parliament In that connection the

Council seeks to emphasize the already charged be nullified but that exceptional circumstances in which illegality would affect the whole system Regulation No 1293/79 was adopted. of regulating the production of Owing to the urgency brought about as isoglucose. Such a solution would have much by the necessity to comply with the the effect of requiring the Community to judgment of the Court declaring Regu- reimburse the levies charged which lation No 1111/77 to be void as by the would result in affording isoglucose factual situation thus brought about producers an unexpected and undue which meant that sugar producers were financial advantage which would subjected to a system of levies whilst discriminate against competing sugar isoglucose producers thus were exempted producers and would enable isoglucose from such a system, the Council was producers unilaterally to strengthen their compelled, having regard to the delay, competitive position.

ties. The Council adds, moreover, that nature of the isoglucose production levy the circumstances in which Regulations militates against the giving of retroactive Nos 387 and 388/81 were adopted and effect to the contested provisions. The the procedure initiated for the adoption Council states that, although the levy in of proposals required to supersede those question may be equated to a charge, regulations bear witness to the Council's that charge pursues no fiscal objective in respect for Parliament's right to be the sense that it was not created for the consulted. purpose of guaranteeing revenue for the Community but to restrict, in the general interest, the development of isoglucose

manufacturers. For that reason the fact If the retroactive effect of the regulations that production was indeed restricted in question were to be adiudged during the marketing yean 1979 and unlawful tne Council argues that not 1980 owing to the application of Regu- only would the legalm of the levies lations Nos 1293/79 and 1592/80 until

3. The Commission of the European Similarly, the Commission states that it Communities, intervening in support of cannot subscribe to the applicant's view the Council's conclusions, points out that the prohibition of imposing charges that: on citizens with retroactive effect is "unanimously" embodied in the laws of Member States. The Commission refers on that point to the study of comparative (a) the case-law of the Court and the law undertaken by Mr Advocate General laws of the Member States admit of Warner in his opinion in the IRCA case true exceptions to the principle that mentioned above. That study shows that: legislation should not be retroactive; and Except with regard to criminal liability there is no provision in the constitution (b) the conditions, to which the case-law of any Member State limiting the extent of the Court makes the retroactive to which legislation may be retroactive; effect of Community provisions subject, were satisfied in the present case. The only limit to the retroactivity of legislation results from the interpretation by the Bundesverfassungsgericht of the German constitution that a statute may (a) The case-law of the Court (in not operate retroactively so as to defeat particular Joined Cases 42 and 49/59 legitimate expectation; (in that respect SS'UPAT v High Authority [1961] ECR the Commission recalls that the Court of 53 by no means rules out the retroactive Justice laid down a similar limit to effect of Community provisions imposing retroactivity in Case 98/78 mentioned charges on individuals. That possibility above), is, moreover, necessarv in a legal system which is called upon to reconcile the general interest with pri\ate interests In all the Member States the legislature when regulations principalis· governing may enact retroactive laws but there is a economic relationships are implemented presumption against its doing so;

The Commission concludes therefore cannot therefore be equated to a that the applicant's analysis of decisions declaration that the contested measure by national courts is inaccurate in was void ab initio. Following the particular with regard to German and consistent case-law of the Court, as illus- French cases. trated by the judgment in Case 101/78 Granaria [1979] ECR 623, that measure was effective until the date of the judgment declaring it void. In those (b) The Commission considers that »the circumstances the legitimate expectation Council's legislative activity has not in of the manufacturers could not have the present case disregarded the been frustrated. As a result isoglucose conditions imposed by the Court on the producers could only rely on established retroactivity of Community measures. rights to a possible reimbursement if the internal legality of the measure had been called in question by the judgment of the (i) First, there was no interference with Court. For the same reason producers the legitimate expectation of the parties may not derive from the declaration that concerned since they cannot satis- Regulation No 1293/79 was void a factorily show the existence of an legitimate expectation to the reimburse- established right or a legitimate ment of the levy paid. In any event, even expectation of reimbursement of the levies if that expectation did not exist the paid or that the retroactive measure in consistent approach of the Community question was unforeseeable. institutions invalidated any such hope and was sufficient to deprive it of any legal significance. With regard to the established right claimed to the reimbursement of the levies in question as a consequence of the The maintenance with retroactive effect annulment of Regulation No 1293/79 to 1 July 1979 of the disputed levy was the Commission points out that the moreover perfectly foreseeable for well- judgments of the Court of 29 October informed manufacturers such as the 1980 could not have the effect of applicants, in view of the grounds upon conferring such a right since the which the decision of the Court in Cases declaration that it was void was merely 138 and 139/79 was based. In fact, due to the finding of a formal irregu- in those judgments, the Court un- larity and not a substantive defect. equivocally rejected all the substantive allegations and referred, somewhat unusually, according to the Commission, The applicant is thus confusine two quite to the possibility that the Council might distinct causes of action available in take any "appropriate measures" to applications based on illegaiitv. namelv regulate the production of isoglucose. external legality and internal legality The cause of action relating to internal legality «as definitívek adiudicated upon by the Court «hen it examined the sub- The Commission observes that the legal stantive allegation* made m Cases 138 significance of the judgments of 29 and 139/79 October 1980 was confined, according to the very terms of the declaration of nullity, to the fact that the Council had a The declaration by the Court that Regu- duty formally to consult the Parliament lation No 12**)/?** %as invalid in law before adopting measures which were

otherwise in conformity with Community Moreover, the reimbursement of the law. On the other hand, the question levies already paid under Regulation No whether or not the provisions concerning 1293/79 would have the effect of isoglucose should be given retroactive breaching the principle of equal treat- effect fell, in the Commission's view, ment as between isoglucose producers within the scope of the appraisal of the and sugar producers and, in the end, general interest made by the Council would threaten the stability of the subject to review by the Court. Thus market.

That state of affairs would be continued if, in (ii) Secondly, the Commission con- addition, the levies already paid were siders that an overriding general interest reimbursed to isoglucose producers. The justified the giving of retroactive effect effect of reimbursement would thus be to Regulation No 387/81. that the responsibility for the financing of the intervention machinery for the In fact it is, in the Commission's view, expon of sweeteners (refunds, indirect undisputed (cf. paragraph 30 of the price guarantees and the like) would fall judgment in Cases 138 and 139/79) that solely upon the sugar producers whereas the restrictive measures imposed on the both categories of manufacturers (sugar production of isoglucose contribute to producers and isoglucose producers) stabilizing the market in sweeteners have benefited from the operation of the within the Communitv in order to ensure machinen a fair standard of living for producers in accordance with the obiecuves of Article 39 of the Treaty.

JUDGMENT OF 30. 9. 1982 — CASE 108/81

raison d'être. Indeed it cannot be disputed In that context, in fact, the Court merely in the present case that the Parliament, rejected the applicants' substantive properly consulted, gave its opinion in allegations which in no way prejudges full awareness of the retroactive effect the conformity of the provisions in conferred by the Council on the measure question with the law. which it was proposed to adopt. The terms of its resolution of 9 February 1981 (Official Journal No 50, p. 14) are The applicant, moreover, observes that unequivocal on that point. The Par- the statement of reasons, supposing that liament was thus able fully to exercise its it may be considered sufficiently explicit, powers since it was aware of the totality can in no way justify the need for retro- of the provisions submitted for its examin- active effect conferred on that regulation ation and since by its opinion it approved and adds that that omission is all the

their rights. Finally, the applicant denies that the Council is entitled to maintain that Regulation No 387/81 is lawful on the Second submission as to a breach of lhe ground that the Court declared Regu- obligation to stale the reasons upon which lation No 1293/79 void merely for a measure is based. infringement of a formal requirement and not on substantive grounds. I The applicant states that Regulation No 387/81 confines itself, as regards the In that respect, it states that that line of statement oi its reasons, merely to argument contradicts the Council's recalimg that the Court found the statement that the conferring of retro- scheme to restrict isoglucose production activity on Regulation No 1293/79 to be substantively in conformity with would have been legally conceivable

AMYLUM v COUNCIL

Sold KG v explained by the wording of the last High Authority [1957 and 1958] ECR sentence of the second recital which is as 121. In the present case, it maintains that follows: this submission "since it is based on lack of competence and breach of the Treaty" "the Court affirmed that the . . . regu- must be considered to be a submission lation was substantively in conformity founded on public policy and judged with Community law; . . . it is therefore admissible. appropriate to reinstate . . . the system of quotas concerned retroactively". (b) As to the substance of the The Council therefore considers that a submission, the applicant maintains that "reasonably attentive reader" and in that the isogiucose production levy con- respect it asserts that the applicant is stitutes revenue accruing to the "much more than" a "reasonably Community budget, which was not attentive" reader having taken pan "in provided for by the law, at the time the previous isoglucose battles" was when the decision of 21 April 1970 was easily able to understand the reasons for adopted and which the Council did not the Council's action and its decision to have the power to create. give retroactive erteci to tne regulation.

JUDGMENT OF 30. 9. 1982 — CASE 108/81

exception which is not relevant to the (Official Journal, English Special Edition present case, formally bars the raising of 1967, p. 304) without conferring on the fresh issues during the course of the Council a power subsequently to create proceedings. The Council considers that new resources. the distinction between submissions Moreover, it is clear from paragraph 54 based on public policy and other of the judgment of the Court in Joined submissions on which the applicant relies Cases 103 and 145/77 Royal Scholten- to justify the admissibility of its action Honig (Holdings) Ltd v Intervention finds no support in the letter of Article Board for Agricultural Produce; Tunnel 42 (2) of the Rules of Procedure and has Refineries Ltd v Intervention Board for never been applied or recognized by the Agricultural Produce [1978] ECR 2037 Court. The Court did acknowledge, in that by Article 1 of Regulation N o particular in its judgments in Cases 2/54 1111/77, the Council "removed iso- Italy v High Authority [1954 to 1956] glucose from the common organization ECR 37 and 19/58 Federal Republic of of the market in sugar". Germany v High Authority [1960] ECR 225 that new arguments may be set out For those reasons, the applicant in a reply in support of submissions first considers that the levy in question was set out in the application.

for in Article 201 of the Treat)· which The Council recognizes that Article 92 provides that the Council may only of the Rules of Procedure enables the recommend to the Member States the Court as any time to consider objections adoption of new own resources in of inadmissibility where those are based accordance with their respective consti- on public policy. But it takes the view- tutional requirements. that that exception should not be regarded as a specific illustration of an For that reason the applicant maintains implied general rule or as being capable that the Council, by imposing the of extension to substantive submissions production levy on isoglucose, acted in whether based on public policy or not. breach of Article 201 of the Treatv and in disregard of Article 2 of the decision In that respect it states that any other of 21 April 197C The levy must interpretation would result in nullifving

the effect of the prohibition contained in case before the Court inasmuch as the the first sentence of Article 42 (2) of the allocation of the levy in question as own R-ules of Procedure which is to ensure resources results from Article 4 of the proper course of the procedure. In Council Regulation No 1110/77 of the present case, that result would be all 17 May 1977 (Official Journal L 134, p. the more serious since almost all the 1) amending the third subparagraph of submissions relating to the proceedings Anicie 27 (2) of Regulation No 333C/74 for a declaration of nullity brought of the Council of 19 December 1974 under Article 173 of the EEC Treaty (Official Journal L 359, p. 1) (earlier may be described as being based on regulation establishing a common public policy inasmuch as they refer to organization of the market in sugar). concepts such as lack of competence, Furthermore, the Council emphasizes infringement of essential procedural that the budgetary allocation in favour of requirements or infringement of the the Community was sanctioned by the Treaty, misuse of powers and so forth. adoption of the Community budget.

That is to lav down measures restricting undeniablv so in the present case as Mr production. Therefore the point in issue Advocate General Reischl stated in his raised bv the applicant may be reduced opinion in Case \Zbf77 Koninklijke to the question of the proper allocation, Scholtrn-Honil W \ Hnofdproduktscbap Q either to the Community budget or to too' Akkrwou^prnjuktrn ll 7S] ECR the budgets of the Member States, of ihe l"°l in \if» ot ihr tact ihat isogiucose is revenue arising from that levy in »hich a prrtrct sustituir 1er *upar the applicant can have no legal interest since in either event it remains iiabic to thai charge. In tnat re*prit tur C ouncil » ishes to stres* that tne »wtem established for The Council then observes that the isogiucovr hx Recusation No 1110/77 suDmission raised does not concern the and in îuice^or* nj> no "real value on

its own" but may be explained only in 3. The Commission, for its part, the light of the organization of the considers that the fresh submission is market in sugar to which it still remains neither admissible nor well-founded. attached by ties resulting from its similarity with sugar and as a result of the direct competition resulting from it. (a) The Commission supports the The Council considers therefore that the Council's conclusions as to the inad- isoglucose levy does constitute a charge missibility of the submission in the light "within the framework of the organ- of Article 42 (2) of the Rules of ization of the markets in sugar" within Procedure. the meaning of Article 2 (a) of the decision of 21 April 1970. The Commission states that, in its view, the concept of "submissions based on public policy" is founded on the idea The Council further claims that the that the degree of illegality invoked is of applicants are putting an erroneous so serious a nature that it falls outside construction on Article 2 of the decision the normal rules of procedure.

the future. The Council on the other 125/77 Koninklijke Scholen-Honig NV\ hand construes that provision as being an Hoofdproduktschap voor Akkerbouwpro- approval of the principle of the transfer dukten, mentioned above, to the to the Community budget of the revenue submission now put forward by the from levies governing sweeteners. The applicants and that the Court did not at fact that technological advances have that time see fit to consider that since 1970 enabled a new product to be

On the follow mg the procedure laid down in contran·, it is clear from the wording of Anicie 2Z\ ci tne EEC Trean those provisions that the Council did not seek to "freeze" the Community's own For those reasons, the Council considers resources in the state in which they were that the fresh submission put torward by on 21 April I97C. In that respect the the applicant is. in anv event, unfounded. choice of the expressions "established or

In the present case the analogous nature of the isoglucose levy cannot be denied since it has a direct connection with IV — Oral procedure measures relating to the sugar sector. That connection stems in the first place At the sitting on 1 July 1982 G. R. from the wording of Regulation No Amylum NV, represented by M. Wael- 1111/77 which expressly refers to Regu­ broeck of the Brussels Bar, the Council lation No 3330/74 establishing a of the European Communities, rep­ common organization of the market in resented by D. Vignes, Director of its sugar. Above all, that connection is Legal Department, assisted by A. highlighted by the interchangeability Bräutigam, Administrator in that existing as between liquid sugar and department, and the Commission of the isoglucose (as the Court found at European Communities, represented by paragraphs 62 and 86 of its judgment in R. Wainwright, Legal Adviser, assisted Joined Cases 103 and 145/77 Royal by F. Lamoureux, a member of its Legal Scholten-Honig Holdings Ltd v Inter­ Department, presented their observations vention Board for Agricultural Produce) and oral argument. and by the attribution of that revenue to the financing of export refunds for The Advocate General delivered his surpluses of sugar production in the opinion at the sitting on 23 September Community. 1982.

Decision

B\ application lodged at the Court Registrv on 4 May 1981 G. R. Amylum N Y . a limited company incorporated under Belgian law, brought an action before the Court under the second paragraph of Anicie 173 of the EEC T r e a t y for a declaration that Council Regulation ( E E C ) N o 387/81 of \Z Februarv 1981 (Official Journal 19S1 L 44. p. 1) amending Council Regu­ lation ( E E C ) N o 1111/77 of 17 Mav 1977 laving down c o m m o n provisions tor isoglucose (Official Journal 19ľ*7 L 134. p 4) is void inasmuch as Anicie

> As regards the first of those t « o conditions it is well to call to mind certain matters of fact or law which are moreover well known to the parties. During the period of application of the contested regulation sugar producers were, in particular, subiect to quotas and production levies. Isoglucose is a product

AMYLUM v COUNCIL

which may be substituted for sugar and is in direct competition with it. Any Community decision concerning one of those products necessarily has reper- cussions on the other. Having regard to that situation, although by judgments of 29 October 1980 the Court declared Regulation No 1293/79 void for infringement of an essential procedural requirement, namely the absence of the Parliament's opinion, the Court nevertheless considered that it was a matter for the Council, in view of the fact that isoglucose production was contributing to an increase in sugar surpluses and that it was open to it to impose restrictive measures on that production, to take such measures in the context of the agricultural policy as it judged to be useful, regard being had to the similarity and interdependence of the two markets and the specific nature of the isoglucose market.

6 If, following the declaration of the nullity of Regulation No 1293/79, the Council had adopted no measure restrictive of isoglucose production — in the present case the reinstatement with effect from 1 July 1979 of the quotas allocated and the levies imposed on the producers — the objective which it was pursuing, namely the stabilization, in the general interest, of the sugar market, could not have been achieved or could only have been achieved to the detriment of sugar producers, who alone would have had to finance the costs of Community surpluses, or even to the detriment of the Community as a whole, whilst isoglucose producers whose production competed with that of sugar undertakings would have escaped all restraints.

10 It should first be pointed out that the contested provisions of Regulation No 387/81 do not include any new measures and merely reproduce the provisions of Council Regulation No 1293/79 declared void by the Court on 29 October 1980.

1 1 In view of the fact that Council Regulation No 1293/79 of 25 June 1979 retained its full effect within the Community legal order until it was declared void, so that the national authorities responsible for its implementation were required to subject the production of isoglucose to the restrictive system which it laid down, such a legitimate expectation could only be founded on the unforeseeability of the reinstatement with retroactive effect of the measures contained in Regulation No 1293/79 declared void by the Court.

¡: In the present case the applicant cannot claim any legitimate expectation worthy of protection.

15 In the first place the traders concerned by the rules in question are limited in number and are reasonably well aware of the interdependence of the markets in liquid sugar and isoglucose, of the situation of the Community market in sweeteners and therefore of the consequences which, following the

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declaration that Regulation No 1293/79 was void, the imposition on the production of sugar in respect of the period from 1 July 1979 to 30 June 1980 of stabilization measures from which the production of isoglucose would have been entirely exempt might have had.

:· In challenging the retroactiv u\ o' those pro\ision> ine applicant turther claims that they disturb tne institutional equilibrium or tne Communities. Tnat claim cannot be upheld On the one hand, there is no provision o'i the Treat)' which precluded the Parliament trom üeing caiieü upon to express its

JUDGMENT OF 30. 9. 1982 — CASE 108/81

views on a retroactive reinstatement of Regulation No 1293/79 although it had not given its opinion on that regulation. On the other hand, the fact that the Court, in declaring that regulation void, did not think fit to make use of the power given to it by the second paragraph of Article 174 to state which of the effects of the regulation which it had declared void should be considered definitive, gives no ground for regarding the retroactive effect given to the contested provisions of Regulation No 387/81, adopted by the Council in the context of the first paragraph of Article 176 of the Treaty, as a trespass on the prerogatives of the Court.

I I — S e c o n d s u b m i s s i o n : Breach of the duty to state the reasons upon which a measure is based

i8 The applicant claims that the Council has given inadequate reasons for the retroactive effect given to Regulation No 387/81 and therefore has infringed the provisions of Article 190 of the Treaty.

19 According to the case-low of. the Court the statement of the reasons on which a measure is based, which is required by Article 190 of the Treaty, must be adapted to the nature of the measure in question. It must enable the reasoning of the Community institution responsible for the measure to emerge clearlv and unequivocally so as to enable those concerned to recognize the reasons for the measure adopted and the Court to exercise its power of review.

22 The submission as to breach of the requirement to state the reasons on which the measure was based must therefore be rejected as unfounded.

I l l — T h i r d s u b m i s s i o n : I n f r i n g e m e n t of A r t i c l e 201 of the T r e a n and A r t i c l e 2 of the d e c i s i o n of 21 April 1970 on the r e p l a c e m e n t of f i n a n c i a l c o n t r i b u t i o n s from M e m b e r States by the C o m m u n i t i e s ' own r e s o u r c e s

:.< In its replv the applicant put forward a new submission based on the Council's lack of competence to create by means of Regulation No 3S7/8I a lew on the production of isoglucose. The applicant takes the view that that levy is revenue accruing to the Community budget which was not provided for bv the legislation at the time at which Council Decision 70/243 of 21 April 1Q7C on the replacement of financial contributions from Member States bv tne Communities' own resources was adopted (Official Journal. English Special Edition 1973 (1). p. 224). The Council therefore did not have the po*er to introduce the contested levy but, in pursuance of Article 201 o\ the Treaty, was able merely to recommend its adoption by the Member States in accordance with their respective constitutional requirements.

JUDGMENT OF 30. 9. 1982 — CASE 108/81

24 The defendant and the intervener consider that submission to be inadmissible by virtue of Article 42 (2) of the Rules of Procedure of the Court of Justice which allows no fresh issue to be raised during the course of the procedure unless it is based on matters of law or of fact which have come to light in the course of the written procedure.

Subject to the procedural conditions which it lays d o w n , Article 43 of the Treatv assigns to the Council the task of creating the c o m m o n organization

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of the agricultural markets and laying down the rules relating thereto. By virtue of Article 40 (3) of the Treaty, that common organization in one of the forms provided for by paragraph (2) of that article, which comprises inter alia a market organization, may include all measures required to attain the objectives set out in Anicie 39, in particular regulation of prîtes, aids for the production and marketing of the various products, storage and carry-over arrangements and common machiner)· for stabilizing imports or exports.

JUDGMENT OF 30. 9. 1982 — CASE 108/81

arc competent to impose duties, taxes, charges, levies or other forms of revenue. As a measure adopted under budgetary law, that decision does not prevent the Council from creating a levy such as the one imposed on the production of isoglucose where the power of the Council to create that levy has its basis, as has been said, in the provisions of the Treaty relating to the common agricultural policy.

3) Furthermore, Article 2 (a) of the decision of 21 April 1970 includes in Communities' own resources revenue coming from "contributions and other duties provided for within the framework of the organization of the markets in sugar". In view of the developments which were inevitably to take place in Community production and marketing of sugar and, consequently, the need to adapt contributions, levies, refunds and price support measures to those developments in the requirements of the Community markets in sugar, it was not conceivable that the scope of application of the decision of 21 April 1970 could have been limited merely to the levies which were provided for when it was adopted, that is to say to the levies laid down at that time by Regulation No 1069/67 of the Council of 18 December 1967 establishing a common organization of the market in sugar (Official Journal, English Special Edition 1967, p. 304). Although isoglucose was only produced in significant amounts in the Community several years after the adoption of the decision of 21 April 1970, the direct competition which it provides for liquid sugar on the market in sweeteners means that it must be included amongst the products which are marketed on the "markets in sugar" within the terms of the decision of 21 April 1970.

hereby:

1. Dismisses as unfounded the application for a declaration that Council Regulation No 387/81 is void;

2. Orders the applicant to pay the costs including those of the intervener.

Due Chloros Grévisse

Delivered in open court in Luxembourg on 30 September 1982.

J. A. Pompe O. Due Deputy Registrar President of the Second Chamber