C-58/83

1. The general scheme of Article 30 of 2. A Member State may not plead ad­ the EEC Treaty and Article 35 of the ministrative difficulties existing in that Act of Accession of the Hellenic State in order to justify a failure to Republic provides for the free comply with its obligations. movement of goods. In so far as Article 38 constitutes a derogation from that principle it must be re- strictively interpreted.

In Case 58 / 83

COMMISSION OF THE EUROPEAN COMMUNITIES , represented by Xenophon Yataganas , a member of its Legal Department , with an address for service in Luxembourg at the office of Oreste Montalto , also a Member of its Legal Department , Jean Monnet Building, Kirchberg ,

applicant, 1 — Language of the Case: Greek.

JUDGMENT OF 10. 5. 1984 — CASE 58/83

V

JUDGMENT

Facts and Issues

I — Facts and written procedure on 31 December 1980 with regard to imports from the existing Member States was to be progressively reduced over a The proceedings relate to the interpret­ period of three years from 1 January ation of the scope of the obligation 1981. The rate of cash payments was to assumed by Greece in Article 38 of the be reduced in accordance with the Act of Accession to the European following timetable: 1 January 1981, Communities which provides that the 25%; 1 January 1982, 25%; 1 January rate of cash payments in force in Greece 1983, 25% and 1 January 1984, 25%.

COMMISSION / GREECE

By decision of 23 January 1981, the The Hellenic Republic contends that the Minister for Commerce decided that Court should: certain products the import value of which was required to be paid wholly in 1. Dismiss the Commission's application; cash as at 31 December 1980 could there­ after be freely imported into Greece. On the other hand, certain other products 2. Order the Commission to pay the continued to be subject to the rule costs. requiring payment of their total value in cash.

JUDGMENT OF 10. 5. 1984 — CASE 58/83

unequal treatment of importers. In there should be four successive re­ consequence the measures in question ductions of 25 %. are equivalent to quantitative restrictions on imports contrary to Article 30 et seq. of the EEC Treaty.

The Greek Government considers it necessary to consider the economic aims of Article 38, which can only be to ensure normal adjustment of the Greek Article 38 of the Act of Accession import system as a whole. The Greek provided for the immediate abolition of Government's interpretation of that such measures from 1 January 1981 and article is permissible in view of its Article 38 introduces a transitional abstract wording. The article does not period of three years for the action settle the question whether the 25 % referred to therein to be taken. reduction in cash payments refers to each individual transaction or to trade as a whole. Thus the Sixth Ministerial Con­ ference decided that the progressive reduction should be effected subject to The Greek policy infringes Article 38 agreement on the detailed arrangements and is incompatible with the objective for the abolition of restrictions. The thereof which is to dismantle restrictive legislature's intention is clarified by the systems progressively in order to avoid minutes of the meetings. The sole point serious disturbances. The result would be of disagreement between the parties that at the end of the transitional period relates to the detailed arrangements for the restrictions in question would still implementation. The Commission cannot exist with respect to the most sensitive act until after the transitional period in imported products and would have to be order to check whether all restrictions abolished completely some months have been abolished in all areas. afterwards.

The interpretation adopted by the Greek interpretation were adopted it would authorities does not, in the view of make no fundamental difference in the Greek Government, constitute an practice since it is impossible to obtain obstacle to the importation of certain credit from foreign undertakings in products and liberalization of others, as respect of certain imports. the Commission alleges, since what is involved is not liberalization but merely a different method of payment. That has IV — Oral procedure no connection with the question whether a product is freely imported or is subject At the sitting on 11 January 1984 oral to a quota system. There is no discrim­ argument was presented for the Com­ inatory treatment of importers since mission by Mr Yataganas and for the foreign undertakings give credit only for Greek Government by Mr C. Stephanou, products such as machines, raw materials acting as Agent, and Mrs O. Pantazi, and so forth, for which the Greek auth­ acting as expert. orities have already authorized purchases The Advocate General delivered his on credit. Even if the Commission's opinion at the sitting on 4 April 1984.

Decision

1 By application lodged at the Court Registry on 24 March 1983 the Commission brought an action under Article 169 of the Treaty for a declaration that by subjecting the importation of certain products from other Member States to the requirement to pay for them wholly in cash, the Hellenic Republic, has failed to fulfil its obligations under Article 30 et seq. of the EEC Treaty and under Articles 35 and 38 of the Act of Accession.

6 The Hellenic Republic contends that it fulfilled its obligation by transferring to the list of products for the importation of which deferred payment was authorized a number of products the volume of which could be determined in advance and represented 25 % of the sums paid in cash.

7 In support of its interpretation the Greek Government refers to the negotiations preceding the Act of Accession. The view of the Sixth Ministerial Conference was that the requirement of payments in cash should be progressively eliminated over a period of three years after accession subject to an agreement on the detailed arrangements to be adopted in that respect. In the absence of such an agreement the Hellenic Republic is free to adopt the detailed arrangements which best suit its interests.

8 The Greek Government also considers that the provision in question was included for its benefit and it thus enjoys a degree of discretion with regard to its interpretation. The Act of Accession was not intended to adopt the interpretation proposed by the Commission. In view of the complex practical and administrative difficulties which would arise if the interpretation proposed by the Commission were adopted, it is appropriate to adopt that proposed by the Greek Government.

COMMISSION / GREECE

9 That argument cannot be accepted. The general scheme of Article 30 of the EEC Treaty and Article 35 of the Act of Accession provides for the free movement of goods. In so far as Article 38 constitutes a derogation from that principle it must be restrictively interpreted. The aim of Article 38 is progressively to dismantle the machinery protecting national industry in order to enable it to use the transitional period to adapt to the increased competition arising from the opening of Greece's frontiers. The method adopted by the Greek Government does not allow that aim to be achieved since it provides, depending on the products involved, either for total main­ tenance or for immediate removal of the protective machinery without a gradual change from one situation to the other. Moreover, the risk of arbi­ trariness inherent in that method is not to be underestimated.

14 Since the Hellenic Republic has failed in its submissions it must be ordered to pay the costs.

On those grounds,

THE COURT

hereby:

1. Declares that by continuing in 1981 to subject the importation of certain products from other Member States to the requirement to pay for them wholly in cash, the Hellenic Republic has failed to fulfil its obligations under Article 38 of the Act of Accession;

2. Orders the Hellenic Republic to pay the costs.