C-110/81

JUDGMENT OF 30. 9. 1982 — CASE 110/81

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

In Case 110/81

SA ROQUETTE FRÈRES, a private limited company incorporated under the laws of France whose registered office is at Lestrem, Pas-de-Calais, represented by its Director, Gérard Rousseaux, assisted by Marcel Veroone, a member of the firm Veroone, Freyria, Letartre, Paillusseau, Hoste and Dutat, 72, Avenue du Peuple Belge, Lille, with an address for service at the Chambers of Mr Loesch, advocate, 2, Rue Goethe, Luxembourg, applicant, v

COUNCIL OF THE EUROPEAN COMMUNITIES, represented by Daniel Vignes, Director of its Legal Department, assisted by Arthur Brautigam, Administrator in that department, with an address for service in Luxembourg at the office of H.J. Pabbruwe, Director of Legal Affairs at the European Investment Bank, 100, Boulevard Konrad-Adenauer, defendant, and

COMMISSION OF THE EUROPEAN COMMUNITIES, represented by R. Wainwright, Legal Adviser, assisted by F. Lamoureux, a member of its Legal Department, with an address for service in Luxembourg at the office of O. Montalto, a member of its Legal Department, Jean Monnet Building, Kirchberg, intervener,

JUDGMENT

Facts and Issues

The facts of the case, the course of the isoglucose was invalid to the extent to procedure and the conclusions, sub- which Anieles 8 and 9 thereof imposed a missions and arguments of the parties production lew on isoglucose of five may be summarized as follows: units of account per 100 kg of dry matter for the period corresponding to the sugar marketing year 1977/78. The Court stated, in fact, that the system established by the above-mentioned provisions offended against the general I — Facts and written procedure principle of equalitv (in that case as between sugar producers and isogiucose producers) The Court added, however, that the ruling iet't the Council free to A — Background to the dispute take anv necessari measures compatible with Communitv law for ensuring the proper functioning of the market in sweeteners 1. By a preliminare ruling of 23 October 1978 given in Joined Cases 1C3 and 143/77 Royal Schnitenliuntg (Holding) Limited \ Intervention board 2 rolio* me tnat ludpment. on 23 June for Agricultural Produce, funnel Mr- I""*- tr.e Council adopted, on the basis pnene* Limned \ Intervention B'urj to* ot a r»ropo\jl tor j regulation drawn up Agricultural ¡hoduce (197*i ECR 2Z>' h\ me Commission. Regulation No the Court of Justice held that Council I2**-'7- Officiai Journal L 162. p. 10. Regulation No 1111/77 ot' 17 MJV ¡wr- *itr> corncrnuum in Official Journal la\ing do» common prov mi*-:» tor . ! "'. p .·" jr-.rr.i3.np Reputation No

JUDGMENT OF 30. 9. 1982 — CASE 110/81

4 Bv separate judgments of 29 October adopted on 23 June 1975 in the absence 1980 ' delivered in Case 138/79 SA of the Parliament's opinion required by Roquette Frères v Council of the European Anicie 43 of the Treaty, on the proposal Communities [1980] ECR 3333 and Case which had been referred to the Par- I 39/79 Maizena GmbH v Council of the liament on 19 March 1979. However, in European Communities [1980] ECR the statement of the grounds upon which 3393, the Court declared Regulation No the ludgment was based, the Coun 1293/79 to be void for infringement of reiected all the substantive arguments essential procedural requirements on the adduced against the system of ground that the regulation had been production quotas introduced by that

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8. Those cases were registered at the 11 Case 179/80 is, however, still Court under Nos 179/80 for Roquette v pending before the Court. Council and 176/83 for Maizena v Council. B — Procedure 9 On IC Januarv 1981. that is to sa\ while Cases 17b and P 9 / 8 : mere pending before the Court, the Council, 1 Bv an application lodged at the after obtaining the opinion oí the Court Reguirv on ? May 1981 5/1 European Parliament which »as Roquette freret requested the Court to delivered on 9 February 1981. adopted declare void Council Regulations (EEC) the following two regulations Nos 387/81 and 388/81

JUDGMENT OF 3C. 9. 1982 — CASE 110/81

2. In its defence dated 30 June 1981 (a) declare this application to be ad­ the Council maintained that the missible and well founded; application was unfounded. (b) consequently, declare void Council Regulations Nos 387/81 and 388/81 3. The applicant lodged its reply at the of 10 February 1981 and the Court Registry on 30 July 1981. individual decisions contained there­ in, at least, in so far as those measures concern the applicant 4. 3y an application received at the undertaking; C o u n Registry on 29 July 1981 the Commission requested the C o u n to allow (c) order the Council to pay the costs. it to intervene in support of the Council.

By order of 30 September 1981 the 2. In its defence the Council of the C o u n , on hearing the views of the European Communities contends that the Advocate General, decided to accede to Court should dismiss as unfounded the the Commission's request to intervene. application brought by the applicant and order the applicant to pay the costs. By intervention received at the C o u n Registry on 17 November 1981 the Commission maintained that the Coun­ 3. In its intervention the Commission cil's position was well founded. supports the conclusions of the Council seeking.

In that connection the applicant bases its First submission: breach of the general argument on the wording of the recitals principle that legislation may not be retro- in the preamble to Regulation No active 1293/79 and on the arguments put forward by the Council in Case 138/79, which led to the judgment of the Court 1. SA Roquette Frères considers that the of 20 October 1979 declaring Regulation principle that legislation may not be No 1293/79 void, and states that the retroactive finds recognition in Com- Council appeared, until the adoption of munity law in the second paragraph of the contested regulations, to have been Article 191 of the EEC Treaty which "convinced of its obligation not to provides that "Directives and decisions infringe the principle of the non-retro- shall take effect upon activity of legislation". The applicant notification", which means that measures assumes therefore that the Council felt adopted under Communir)' law may not obliged to revise its view and maintains have effect prior to their notification. that, in the present case, the conferring of retroactive effect on Regulations Nos 387/81 and 388/81 does not satisfy the In the applicant's view it is immaterial conditions of lawfulness laid down bv that Regulations Nos 387/81 and 388/81 the judgment of the Court in the Racke under challenge are not "decisions" case. within the meaning of that provision. In fact, by way of the regulations which form the subject-matter of the appli- The applicant observes that the retro- cation, the applicant is contesting the active application of the quota system is, individual decision included in the in its view, entirely "ineffective and provisions of a general nature, which useless". In fact, the applicability of subiect it to a system of production Regulation No 1293/79, until it was quotas and levies. declared void by the Court, in any event compelled isoglucose producers to respect the volumes of production imposed by the Community legislature. ra) More generalk, the applicant main- Thus, the oniv practical reason for the tains thai "true" retroactivity, namely the retroactivity of the contested regulations application to completed transactions of is to subject the applicant to the pavment a svsiem regulating the production of of production levies in respect oi periods isogiucose. has been condemned by the preceding the 198 1 marketing vear Such Cour. In tact n is clear from the retroactive gi\es those measures a fiscal judgments in Cases 7,76 ¡RCA \ or parafiscal nature and is therefore Amminnirjīione aelie Finanze dello Stato specificallv contrarr to ali general legal [ I W ECR i : i 3 . Case 9t>/77 Bauche v principles ÂJminatrjnor. Francane des Douanes ¡1*"v ECR >t> and Case 9s/7S Racke v Haurtioltamt Mair.z [1979] ECR b9 that Communitv b » acmits ot retroactivity (b) Moreover the applicant states that oniv "m exceptional cases where the the Council, bv gi\ing the contested purpose to be achieved so demands and regulations retroactive effect, failed to »nere me ¡eguimate expectations of fulfil me obligation imposed on it bv the

first paragraph of Article 176 of the EEC (a) There can be no legitimate Treaty "to take the necessary measures expectation on the part of the applicants to comply with the judgment of the in view of the circumstances in which Court of Justice". The applicant Regulation N o 1293/79 was declared interprets that provision as imposing a void and in the light of the consistent duty on the authority whose measure has approach of the Community institutions been declared void by the Court, on the in this matter. one hand to restore matters to the state in which they were, that is to say in the present case, to invite the competent national authorities to abolish charges to In fact, isoglucose producers had known production levies, which, following the since 17 May 1977, the date of entry judgment of the Court, was deprived of into force of Regulation N o 1111/77, of any legal foundation and, on the other the Community's intention to adopt hand, not retroactively to reinstate the restrictive measures with regard to the same provisions as those which were production of isoglucose.

existence of legitimate expectation on the pan of isoglucose producers of the 2. The Council of the European abolition, as regards the past, of the Communities, the defendant, considers regulations relating to isoglucose would for its pan that the case-law of the Court thus only be conceivable if the Court had clearlv demonstrates, in particular in its condemned that policy in principle. The judgment in Case 98/78 Racke [1979] judgment declaring Regulation No ECR 69 at paragraph 20 that retroactive 1111/77 to be void was restricted to Community measures are by no means condemning the method of calculating excluded as a matter of principle. the isoglucose production levy and not However, the Court has sought to make the principle of the levy. In that context retroactive Community measures subject it was thus conceivable, from a legal to judicial review to ensure that they point of view, that the Council might observe in particular the following amend Regulation N o 1111/77 with conditions: retroactive effect. For "reasons of advisability from the point of view of la) first, the protection of legitimate poliev" the Council declined to adopt expectation on the paa of those that solution and adopted instead Regu concerned »here such expectation is lation N o 1293/79 whose substantive present. conformity with Community law was clearlv upheld by the Coun in its Įudgment in Joined Cases 138 and (b) secondlv. the retroactivity ot' the

ROQUETTE FRÈRES v COUNCIL

were thus consistently confirmed and the the applicants in Cases 138 and 139/80 is Council was therefore entitled to sufficient to support the Council's view reintroduce the disputed levy with retro- that its action was not in itself active effect to the marketing year reprehensible and that the charging of 1979/80. levies was lawful in principle as from the marketing year 1979/80. In that connection it should be recalled that the Court held, in its judgment in Case In the Council's view, the contested 101/78 Granaria [1979] ECR 623 that measures are of a "mixed" nature regulations are to be applied as long as inasmuch as they contain legislative the Court of Justice has not taken a provisions of general application, such as decision with regard either to their the laying down of abstract criteria for legality (Article 173 of the Treaty) or organizing production and allocating their validity (Article 177 of the Treaty). quotas, and provisions which may be Thus Regulations Nos 1293/79 and considered to be individual decisions 1592/80 were to be given full effect such as provisions allocating production including as regards the charging of the quotas to each manufacturer in the levy until the delivery in October 1980 of Community. the judgment declaring them to be invalid.

JUDGMENT OF 3d. 9. 1982 — CASE 110/81

The Council, however, observes that its dignity as the regulation. Community legislature, its desire to respect the Treaties and also the Commission's power, as guardian of those Treaties, to ensure compliance The Council therefore did not fail to with the law are all of such a nature as complv with its dutv under .Article 176 of to ensure the proper functioning of the the EEC Treaty and cannot be accused legislative machinen' of the Communi- of having frustrated a legitimate expec- ties. The Council adds, moreover, that tation which was entirely non-existent the circumstances in which Regulations since those concerned, who as prudent Nos 387 and 388/81 were adopted and traders were fully informed of the the procedure initiated for the adoption Community's action in the isoglucose of proposals required to supersede those sector, had been warned both in law and regulations bear witness to the Council's in fact of the unequivocal intention of respect for Parliament's right to be the institutions to pursue their policy of consulted. regulating the sector in question.

Regulations Nos and 3>." '«'l If the retroactive effect of the regulations in question were to be adiudged ho» a!' ¡íTur reason* ihr Council unlawful the Council argues that not considers tra: u hav not defied the oniv would the legality of the levies autnorits o' ihr C o u r O' the powers of alreadv charged be nullified but that ihr Pjriiar-irr·.: |r. >t\n connection thr illegality would affect the whole system Council ^ffK\ to empr';js:/r tne for regulating the production of

isoglucose. Such a solution would have the competitive situation of isogiucose the effect of requiring the Community to producers, would have the effect of reimburse the levies charged which destroying the system whereby pro- would result in affording isogiucose duction of isogiucose was restricted in producers an unexpected and undue the marketing years 1979 and 1980. financial advantage which would discriminate against competing sugar producers and would enable isoglucose producers unilaterally to strengthen their 3. The Commission of the European competitive position. The result would be Communities, intervening in support of in the end contrary to the requirements the Council's conclusions, points out of the common agricultural policy and in that: particular to Article 39 of the Treaty which, as the Court has emphasized, imposes limits on the freedom of action of institutions with regard to restrictive (a) the case-law of the Court and the measures concerning the sugar industry. laws of the Member States admit of true exceptions to the principle that legislation should not be retroactive; and (c) Lastly, the Council seeks to refute the argument that the fiscal or parafiscal nature of the isoglucose production levy (b) the conditions, to which the case-law militates against the giving of retroactive of the Court makes the retroactive effect to the contested provisions. The effect of Community provisions Council states that, although the levy in subject, were satisfied in the present question may be equated to a charge, case. that charge pursued no fiscal objective in the sense that it was not created for the purpose of guaranteeing revenue for the Community but to restrict, in the general interest, the development of isoglucose (a) The case-law of the Court (in production. In that connection the particular Joined Cases 42 and 49/79 Council points out that the revenue from SKUPAT\ High Authority [1961] ECR the levy in question is not uniform but 53) by no means rules out the retroactive depends upon the relationship of the effect of Community provisions imposing value on the world market of sugar to its charges on individuals. That possibility is value within the Community. In order to moreover necessary in a legal system finance losses incurred in the exporting which is called upon to reconcile the ol sugar (expon refunds) arising from general interest with private interests surplus production in the Community of when regulations principaliv governing sugar or ot isogiucose. the levy is economic relationships are implemented. charged oniv if the production quotas are exceeded ou mg to the activity of the manufacturers For that reason the fact In the Commission's opinion it is wrong t ha: production u as indeed restricted to take the vie* that tne Cou only dunnp the marketing \ears |Q~Q and sought, in its case-ia*, to reter to l w . s ¡ ou mi; to the application of Regu- "limited" retroactive eftect and not to lations Nos 1293/79 and 15^2/SC until "true" retroactivity. In particular the October 1 *#S2 is immaterial In tact a opinion of Mr Advocate General Reischl reimbursement of the lev\. apan from in the Ŕacke case emphasized that the the tact that it «ouid unilaterali^ aitcr Court in that case nad to adiudicate

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 198C could not have the effect of applicants, in view of the grounds upon conferring such a nght 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, in due to the finding of a formal irregu- those judgments, the Court unequivo- laris- and noi a substantive defect. cally rejected all the substantive allegations and referred, somewhat unusually, according to the Commission, to the possibility that the Council might take any "appropriate measures" to The applicant is thus contusing t*o quite regulate the production of isoglucose. distinct causes of action available in applications based on ilirgahtv. namelv external legaim and internal legality. The cause ot action relating to internal legaliu «as definitivei* adiudicated upon The Commission observes that the legal b\ the Court «hen it examined the sub- significance of the judgments of 29 • stanine aliegations made m Cases 138 October 1980 was confined, according and I3<*'7V to the very terms of the declaration of

ROQUETTE FRERES v COUNCIL

Thus would threaten the stability of the regard being had to the fact that, market. contrary to the first decision of the Court concerning Regulation No 1111/77, neither the principle nor the First, such reimbursement would confer methods of determining the levy were a financial benefit on isoglucose pro condemned by the Court, the reference ducers which sugar producers would not made by the Court to the possibility that receive. That would be all the more the Council might adopt "all appropriate unfair since, following the preliminar)' measures" might, in the Commission's rulings of 25 October 1978, they have view, be interpreted as meaning that the already benefited from a "considerable measures contained in the regulation, advantage" by not being made subject to which had been declared void on the first levy provided for by Regulation grounds of external illegality, might be No 1111/77. That would result in a reinstated with retroactive effect. strengthening of the productive capacity of those producers which already poses a threat to the stability of the market.

It is aiso not disputed that that obiective of general interest, Secondlv. the Commission points out given the close link by means of »hich that the abolition ďt> initio of the levy, liquid sugar and isoplucose mav be sub apan trom the fact thai it *ould bring stituted lor each other, may be achieved about an uniustifted enrichment of a onlv by the combination of provisions categon of producers thus permitting relating to sugar and those governing them to increase their productive isoglucose. For that reason it is not capacitv. would tree them from all possible to declare void ab initio the financial responsibilitv for the disposal of provisions relating to isoglucose without the surplus stemming from the increase damaging the whole machinen designed in their productive capacitv and would

thus seriously threaten the proper It states that, pursuant to the Treaty and functioning of the sugar markets. the case-law of the Court, such a total absence of reasons is sufficient to entail The Commission thus considers that the the nullity of such measures. Council was justified in taking the view that an overriding public interest 2. The defendant, the Council of the required, by itself, that retroactive effect European Communities, considers for its be given to the provisions in question. part that those allegations are un-

unequivocal on that point. The Parlia- lation No 1293/79. ment was thus able fully to exercise its powers since it was aware of the totality of the provisions submitted for its exam- As regards the absence of reasons for the ination and since by its opinion it necessity of the retroactive effect given approved those measures. If that were to Regulation No 387/81 the Council not the case and on the supposition that considers that that necessity is clearly the Council insisted on adopting a regu- explained by the wording of the last lation in breach of its duty of consul- sentence of the second recital which is as tation and that the Commission, follows: "heedless both of its role as guardian of the Treaties and of the risk ofcensure by "the Court affirmed that the . . . regu- the Parliament", allowed the Council to lation was substantively in conformity persist in its stance, the Commission with Community law; . . . it is therefore points out that it would remain open to appropriate to reinstate . . . the system of the applicants to bring a second action quotas concerned retroactively". before the Court in order to presene

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1. In its reply the applicant makes a for within the framework of the organ- further submission relating to the ization of the markets in sugar" within Council's lack of competence to create the meaning of Article 2 of the decision new own resources. of 21 April 1970 since that decision, (a) As to the admissibility of thai according to the applicant, intended only submission the applicant states that the to refer to the duties and levies Court has on several occasions acknowl- introduced by Regulation No 1009/67 of edged that submissions founded on the Council of 18 December 1967 public polio' may be made before the (Official Journal, English Special Edition

Noid KG v of the judgment of the Court in Joined High Authority [1957 and 1958] ECR Cases 103 and 145/77 Royal Scholten- 121. In the present case, it maintains that Honig (Holdings) Ltd v Intervention this submission "since it is based on lack Board for Agricultural Produce; Tunnel of competence and breach of the Treaty" Refineries Ltd v Intervention Board for must be considered to be a submission Agricultural Produce [1978] ECR 2037 founded on public policy· and judged that bv Article 1 of Regulation No admissible. 1100/77, the Council "removed iso- glucose from the common organization (b) As to the substance of the of the markei in sugar". submission, the applicant maintains thai the isoglucose production levy For ihose reasons. the applicant constitutes revenue accruing to the considers that the levy in question was Community budget, which was noi wronglv equated bv the Council, in the proNiaed for by the law at ihc time when ninth recital in the preamble to Regu- tne decision of 21 April 1970 was lation No 1111/77. to own resources adopted, and which the Council did not within the meaning of Anicie 2 of the have the power to create. decision of 21 April 1970.

JUDGMENT OF 30. 9. 19§2 — CASE 110/81

of 21 April 1970. contained in the first sentence of Article 42 (2) of the Rules of Procedure which is to ensure the proper course of the 2. In its rejoinder, the Council of the procedure. ín the present case that result European Communities considers the would be all the more serious since fresh issue raised by the applicant to be almost all the submissions relating to inadmissible and unfounded. proceedings for a declaration of nullity brought under Article 173 of the EEC (a) The Council bases its opinion as to Treaty may be described as being based its inadmissibility on Article 42 (2) of the on public policy inasmuch as they refer Rules of Procedure which, subject to an to concepts such as lack of competence, exception which is not relevant to the infringement of essential procedural present case, formally bars the raising of requirements or infringement of the fresh issues during the course of the Treaty, misuse of powers and so forth.

Court. The Court did acknowledge, in particular in its judgments in Cases 2/54 (b) In the alternative, the Council hah v High Authority [S954 to Î956] considers this submission to be un- ECR 37 and 19/58 Federal Republic of founded. ín support of that claim it puts Germany v High Authority [1960] ECR forward the following arguments: 225 that new arguments may be set out in a reply in support of submissions first in the line of decisions which it has given set out in the application. On the other as to the lawfulness of the system hand, the Court in its judgment in established in respect of the production Joined Cases 19 and 21/60 and 2 and of isoglucose the Court has acknowl- 3/61 Fives Lille Cati v High Authority edged that the Council had the power [1961] ECR 2§1 clearly decided against to lay down measures restricting admitting the introduction during the production.

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The (Official Journal L 359, p. 1) (earlier Council considers therefore that the regulation establishing a common isoglucose lew does constitute a charge organization of the market in sugar). "within the framework of the organi- Furthermore, the Council emphasizes zation of the markets in sugar" within that the budgetary allocation in favour of the meaning of Article 2 (a) of the the Community was sanctioned by the decision of 21 April 1970. adoption of the Community budget.

the future. The Council on the other Finally, the Council rejects the argument hand construes that provision as being an that the levy in question constitutes a approval of the principle of the transfer new charge excluded from the scope of to the Community budget of the revenue application of Article 2 (a) of the from levies governing sweeteners. The decision of 21 April 197C. in fact, in the fact that technological advancements Council's view, the isoglucose levy- have since 1970 enabled a new product corresponds to the letter to that to be placed on the market in the same provision inasmuch as the expression sector cannot be regarded as affecting "contributions . . . provided for within the principle of the transfer to the the framework of the organization of the Community budget of revenue arising markets in sugar" does not necessarily from levies imposed on sweeteners.

JUDGMENT OF 30. 9. 1982 — CASE 110/81

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Treaty. It adds, in the alternative, that the European Communities, represented the question of the budgetary allocation by D. Vignes, Director of its Legal of that charge does not call for Department, assisted by A. Bräutigam, consideration in the context of the Administrator in that department, and present proceedings since the applicant the Commission of the European Com- has no sufficient legal interest in that munities, represented by R. Wainwright, question. Legal Adviser, assisted by F. Lamoureux, a member of its Legal Department, presented legal argument and obser- IV — O r a l p r o c e d u r e vations.

At the public sitting on 1 July 1982 SA The Advocate General delivered his Roquette Frères, represented by M. opinion at the sitting on 23 September Veroone, of the Lille Bar, the Council of 1982.

Decision

1 By application lodged at the Court Registry on 7 M a y 1981 SA Roquette Frères, a limited company incorporated under French law, brought an application before the C o u r t under the second paragraph of Article 173 of the E E C T r e a t y for a declaration that:

1. Council Regulation N o 387/81 of 10 February 1981 (Official Journal L 44, p. 1) amending Council Regulation N o 1111/77 of 17 M a y 1977 laying down c o m m o n provisions for isoglucose (Official Journal L 134,

4 In suppon of its action the applicant claims in its application first that the contested regulation offends against the principle that Community measures should not have retroactive effect and secondly that the statement of the reasons upon which the measure was based is insufficient. In its reply, the applicant makes a funher submission based on the Council's lack of competence to create an isoglucose production levy.

I — First s u b m i s s i o n : Breach of the principle that C o m m u n i t y measures may not have retroactive effect

5 As the Court has alreadv held, in particular in its judgments of 25 January 1979 in Case 98/78 Racke [1979] ECR 69 and Case 99/78 Decker [1979] ECR ÍC1, although in general the principle of legal cenainty, as the applicant states, precludes a Community measure from taking effect from a point in time before us publication, it may exceptionally be otherwise where the purpose to be achieved so demands and where the legitimate expectations of those concerned are duly respected.

• As regards the first of those two conditions it is well to call to mind cenain matters ot fact or la* which are moreover well known to the pames. During

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s In that situation the Council was lawfully entitled to consider that the objective to be achieved in the general interest, namely the stabilization of the Community market in sweeteners without arbitrary discrimination between traders, required the contested provisions to be retroactive in nature and thus the first of the conditions *hich the Court lays down for the applicability rattorte tempons of a Community measure to a date prior to the date of its publication mav be regarded as satisfied.

«» To ascenain whether the second of the conditions set out above is also satisfied it is necessary to inquire whether the action of the Council has

JUDGMENT OF 30. 9. 1982 — CASE 112/81

frustrated a legitimate expectation on the pan of the applicants to the effect that the production of isoglucose would not be regulated during the period from 1 July 1979, the date from which Regulation No 387/81 retroactively applied, to 17 February 1981, the date of publication of that regulation and of Regulation No 388/81.

i: It should first be pointed out that those two regulations do not include any new measures and merely reproduce the provisions of Council Regulations Nos 1293/79 and 1592/80.

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 and extended as from 1 July 1980 by Regulation No 1592/80.

i6 Finally, from the publication of the Commission's proposal in the Official Journal of 20 December 1980 (C 334, p. 2) the applicant knew that the Commission had, as early as 3 December 1980, submitted to the Council a proposal for a regulation amending, in particular, Regulation No 1111/77, in order to reinstate, for the period from 1 July 1979 to 30 June 1980, the system of quotas and levies in the form in which that system had been laid down by Regulations Nos 1293/79 and 1592/80 and in which it was to be reinstated by the contested provisions of Regulations Nos 387/81 and 388/81.

ir In challenging the retroactivity of the regulations in dispute the applicant makes various allegations.

is It first observes that by virtue of Article 174 of the Treaty, a measure invalidated by the Court is to be declared void and. in declaring Regulation No 1293/79 void, the Court did not make use of the power given to it by the second paragraph of Anicie 174 to state which of the effects of the regu- lation which it had declared void should be considered to be definitive. It infers from that that the obligation imposed on the Council by the first paragraph of Article 176 to take the necessarv measures to complv with the ludgmem of the Court required u to invite national authorities to abolish the charge to production levy on the production ot isoglucose

19 That interpretation is incorrect. The nullitv of Regulation No 1293/79 pro- nounced by the Court, panicularlv in a situation where, bv us ludgments of 29 October 1980, the Court had censured the failure to obtain an opinion of the Parliament but had dismissed the substantive aliénations made against that regulation by the applicant and by Maizena GmbH did not compel the

Since the conditions necessari· for retroactively reinstating, by means of the contested regulations, the provisions of Regulations Nos 1293/79 and 1392/80 were satisfied, the submission that the retroactivity given to Regu- lations Nos 387/81 and 388/81 is unlawful must be rejected.

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II — Second s u b m i s s i o n : Breach of the duty to state the reasons upon which a measure is based

23 The applicant claims that the Council has given inadequate reasons in Regu- lations Nos 387/81 and 388/81 for the retroactive effect given to those regu- lations and therefore has infringed the provisions of Article 190 of the Treaty.

24 According to the case-law 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 clearly 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.

27 Laconic as these reasons may be, they satisfy the requirement laid down by Article 190 of the Treaty. In fact, by referring to the system of production quotas, which moreover was well known to those concerned, and by the concern to preserve legal certainty which is shown in particular by Regu- lation No 388/81, to avoid any doubts as to the version applicable from then on of Article 9 of Regulation No 1111/77, the provisions of the preamble to the contested regulation set forth in essence the objective pursued by the institution responsible for the contested measure, namely to ensure continuity in time of the system restricting isoglucose production in order to ensure an equal division of burdens on the production of isoglucose and that of liquid sugar which are in direct competition on the market in sweeteners.

28 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 t h e T r e a t y a n d 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 S t a t e s by the C o m m u n i t i e s ' o w n r e s o u r c e s

:« In its reply the applicant put forward a new submission based on the Council's lack of competence to create by means of Regulation No 387/81 a levy on the production of isoglucose and to extend its application by means of Regulation No 388/81. The applicant takes the view that that levy is revenue accruing to the Community budget which was not provided for by the legislation ai the time at which Council Regulation No 70/243 of 21 April 1970 on the replacement of financial contributions from Member States by the Communities' own resources was adopted (Official Journal, English Special Edition 1970 N), p. 224). The Council therefore did not have the power to introduce the contested levy but, in pursuance of Article 2C1 of the Treaty, was able merely to recommend its adoption by the Member States in accordance with their respective constitutional requirements.

.u However, since the submission relates to the powers of the author of the contested measure, the Court considers that it should state the reasons why the Council was competent to impose a levy on the production of isoglucose.

» Subiect to the procedural conditions which it lavs down. Article 43 of the Treaty assigns to the Council the usk of creating the common organization of the agricultural markets and laying down the rules relating thereto. By virtue of Article 43 (3) oí the Treaty, that common organization, in one of the forms provided for by paragraph (2) of that aniele, *hich comprise inter alta a market organization, may include all measures required to attain the objectives set out in Article 39, in pamcular regulation of prices, aids for the

JUDGMENT OF 30. 9. 1982 — CASE 110/81

production and marketing of the various products, storage and carry-over arrangements and common machinery for stabilizing imports or exports.

ROQUETTE FRÈRES v COUNCIL

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.

39 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 thai 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.

*: It follows thai the Council was competent to adopt the contested provisions contained in Regulations Nos 387/81 and 388/81 and that no provision of budgetary law affected thai power.

1. Dismisses as unfounded the application for a declaration that Council Regulations Nos 387/81 and 388/81 are 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

O P I N I O N OF MR ADVOCATE GENERAL REISCHL