C-61/86

3. In examining the question whether there 7. The defendant's interpretation to the is a sufficient legal basis for the adoption of effect that on the grant of variable slaughter the contested regulations in Article 9 (3) of premium for sheep clawback must be Regulation No 1837/80, in the version set charged on all products referred to in out in Regulation No 871/84, I consider it Article 1 (a) and (c) of Regulation No appropriate to recall that provision: 1837/80 might give rise to doubts if its

* Translated from the German. 2 — Emphasis added. 1 — Official Journal 1980, L 183, p. 1. 3 — Official Journal 1984, C 62, p. 68.

OPINION OF MR LENZ —CASE 61/86

proposition were taken to its logical granting a variable premium for all sheep by conclusion; on that hypothesis, for example, providing that rams or ewes or their where premium is granted for sheepmeat carcases would not qualify for the premium. clawback would also have to be charged on goats and goatmeat — which even the defendant does not maintain is the case.

9. In addition, it should be pointed out that 12. Thus, for example, the Court of Justice according to the original scheme of Regu­ held in its judgment of 30 October 1975 in lation No 1837/80 variable slaughter Case 23/75 4that when Article 155 of the premium could be granted without EEC Treaty provides that the Commission restriction for any type of sheep, thus is to exercise the powers conferred on it by including, for example, ewes and rams, the Council for the implementation of the which corresponded, at least in the case of rules laid down by the latter, it follows from ewes, to the applicant's previous practice the context of the Treaty in which the under the system of special export certifi­ provision must be placed and also from cation (SEC). Not until the adoption of practical requirements that the concept Commission Regulation No 3451/85 of 6 'implementation' must be construed December 1985, on the basis of Article 9 (4) liberally. Since the Commission alone is in a of Regulation No 1837/80, did the position to follow continuously and atten- Commission, through the new version of Article 1 of Regulation No 1633/84, 4 — Rey Soda v Cassa Conguaglio Zucchero [1975] ECR 1279, deprive the applicant of the possibility of at pp. 1300 and 1301.

UNITED KINGDOM v COMMISSION

13. It was precisely to the principles just 15. The Commission's statement that the described that the Court had recourse in its effects of payment of variable slaughter judgment of 11 March 1987 in Joined Cases premium had to be offset by the charging of 279/84, 280/84, 285/84 and 286/84 5 in clawback must also be examined in the light which it accepted a merely indirect link of its extensive discretion in matters of between the implementing regulation economic policy, to which I have already adopted by the Commission and the basic referred several times; those effects may also Council regulation as a sufficient enabling be seen, according to the Commission, in basis for the former. 6 the case of products in respect of which sheepmeat producers were not granted a premium. It would in the Commission's 14. In the light of those decisions, opinion be naive to assume that a premium which recognize that the defendant enjoys a which is granted in respect of a large large degree of autonomy in implementing proportion of sheepmeat production in the Council regulations, it cannot be regarded United Kingdom (approximately 85%) has no effect on the price of sheepmeat in 5 — Waller Rau Lebensmittelwerke and Others v European respect of which no premium is granted. Economic Community (represented by the Commission of the European Communities) [1987] ECR 1069. 6 — Thus the Court found in the result that there was sufficient authority for the Commission's Christmas butter scheme in that the measure in question was consistent with the objectives of Articles 6 and 12 of Regulation No 804/68 of the Council of 24 June 1968 on the common organization 16. It has not become apparent during the of the market in milk and milk products (Official Journal, English Special Edition 1968 (I), p. 176) and with the course of the proceedings that that view is objectives of the Council's implementing regulations which related to matters other than the Christmas butter scheme, wholly unfounded. Although it might have although the individual procedural steps laid down in been desirable for the defendant to have Articles 6 and 12 of Regulation No 804/68 were not fully complied with. furnished reviewable evidence in support of

its view in the form, possibly, of economic regional intervention systems, 8 it is not analyses of the cost calculations of possible to show that the Commission has sheepmeat producers in Great Britain, it adopted a measure which is manifestly cannot, however, be excluded that the improper. payment of variable slaughter premium in fact leads to competitive advantages for sheepmeat producers in Great Britain. 18. It cannot therefore be successfully denied that the two contested regulations find in Article 9 of Regulation No 1837/80, in the 1984 version of that article, an adequate legal basis in the light of Community law as it stood at that time, this being the only question to be determined

completed. Precisely because the market 8 — To this extent the defendant is in a better position in this case than in Joined Cases 279, 280, 285 and 286/84 which, organization in question is still a 'market in contrast to the present case which concerns a market organization in the process of formation' organization in the process of formation, related to a fully formed market organization with a uniform intervention which continues to encompass differing system applicable throughout the Community. 9 — See, in particular, the minutes of the meeting of 4 November 1985 at which the defendant referred to an 7 — Judgment of 25 September 1979 in Case 232/78 alteration in the rate of clawback should the proportion of Commission of the European Communities v French Republic ewes in the total exports of sheepmeat to France fall [1979] ECR 2729. outside a bracket of 19.5 to 24.4%.

21. In the course of the proceedings before it was held that the effects of the payment the Court the defendant explained that, of variable slaughter premium could be when faced with two contradictory claims, offset and that the corresponding clawback namely on the one hand that no clawback was not to be regarded as an export duty. should be charged, as was demanded by the applicant and, on the other, that clawback of 100% should be charged, which the intervener considers to be the correct 25. At this point it must first be remarked approach, it had to try to find a middle way that the aforementioned judgment of 15 between those two positions. September 1982 gave a ruling on the market organization in sheepmeat and goatmeat in its original form. Originally, when adopted 22. Since according to Article 9 (4) of in 1980, Regulation No 1837/80 distin­ Regulation No 1837/80, in the 1984 version guished between a uniform basic price for of that provision, the measures to be sheepmeat in the Community and various adopted by the Commission include in reference prices in the different regions of particular those measures necessary to the Community. In 1980 the uniform basic prevent any disturbance of trade resulting price was ECU 345 per 100 kg whilst the from the application of variable slaughter regional reference prices varied from ECU premium and thus to stabilize the markets, 293 per 100 kg for the United Kingdom to which still display differences between them, ECU 345 for France and ECU 375 per 100 in accordance with Article 39 of the EEC kg for Italy. Consequently, when the Treaty, it must be concluded that, in the common organization of the market entered 10 circumstances which obtained, the into force, account was taken of the defendant's action in this respect kept different market prices in the Community. within the ambit of the objectives of the In 1984 the market prices were stan­ common organization of the market in dardized: the reference prices were sheepmeat and goatmeat and of the EEC abolished and a uniform basic price of 12 Treaty. Consequently, the Commission has ECU 428 per 100 kg was fixed. The not misused its powers. situation today is therefore different and conclusions reached in 1982 cannot be applied to it without qualification. (3) Breach of the principle of the free movement of goods

now Great Britain) was considerably lower appreciably lower than those obtaining on than the basic price, it was in fact possible, 13 the markets of the latter States. when the Court delivered its judgment of 15 September 1982, to speak of a significant competitive advantage for sheepmeat producers in region 5 (United Kingdom). Not until the adoption of Council Regu­ 28. Both parties rely on that extract from lation No 871/84 of 31 March 1984 was the the Court's judgment of 15 September 1982 difference between the reference price and and then proceed once more to' draw the basic price abolished and consequently a divergent conclusions by emphasizing uniform basic price laid down for the Community, which applied both to the different passages thereof. The United calculation of the premium intended to Kingdom takes the view that clawback may offset loss of income and to the calculation be charged only if it is intended to offset of the amount of variable slaughter exactly the effects of the slaughter premium premium. As a result the various premium whilst the Commission considers it may be schemes for the individual regions of the charged if it is intended to offset exactly the Community no longer differ as regards the effects of the slaughter premium. amount of the premium but merely as regards the time of payment.

UNITED KINGDOM v COMMISSION

Court of Justice in its judgment of 15 shown that the Commission's evaluations of September 1982 must continue to apply the economic factors belong to a field in notwithstanding the further development of which it has a wide discretion regarding the common organization of the market in economic policy because it has to assess a sheepmeat and goatmeat: the charging of complex economic situation. In reviewing clawback constitutes part of the intervention the exercise of that discretion the Court has system. Consequently, it cannot be regarded hitherto restricted itself in its decisions to as constituting a violation of the principles verifying whether the institution in question governing the free movement of goods. has committed a manifest error, has misused its powers or has manifestly exceeded its (4) Breach of the duty to provide a statement discretion. of reasons (Article 190 of the EEC Treaty) 33. As no such manifest errors could be 31. The United Kingdom submits that in found in the statement of reasons upon the recitals in the preambles to the two which the contested regulations are based contested regulations the Commission has and as the considerations upon which the made assertions which are not justified by defendant's decision rests are clear — which the facts. the Court has consistently held is all that is required precisely in the case of measures of 15 32. These formal submissions are related to general application — there has been no the substantive submissions which have infringement of Article 190 of the EEC already been discussed. That discussion has Treaty.