C-300/86

VAN LANDSCHOOT v MERA

OPINION OF MR ADVOCATE GENERAL DARMON delivered on 9 February 1988 *

Mr President, for repayment of the amount retained, by Members of the Court, way of co-responsibility levy in the cereals sector, by the company Mera NV , the defendant in the main proceedings, when it purchased cereals from the farmer, Mr Van 1. When the Court, by order of 20 May Landschoot, the plaintiff in the main 1987, 1 declared inadmissible actions for proceedings. The question of the validity of annulment brought against Commission the regulation in question therefore arises in Regulation No 2040/86 of 30 June 1986 the context of a dispute between private laying down detailed rules for the parties. In fact, both parties challenge before application of the co-responsibility levy in the national court the aforesaid regulation's 2 the cereals sector, it stated, in reply to an validity. This particular feature of the case argument pointing out the need to provide should not, however, prevent the Court the persons concerned with effective judicial from replying to the question which has protection, that: been referred to it.

3. The essential complaint made against the ' ... a plaintiff may, in support of an action regulation concerns the rules governing brought against a national measure exemptions from the levy. First-stage implementing a Community measure, plead processing operations are exempted from that the Community measure is unlawful the co-responsibility levy provided that the and thus require the national court to give a products of the processing are used as ruling on all the submissions made in that animal feed on the same holding and that respect.' 3 the processing is carried out with the farm's own machinery, whether temporary or 5 permanent, by a farmer whom I will call:

first-stage processing operations concerning rules for the application of the co-responsi­ other producers' cereals, in particular those bility levy laid down by the Commission of suppliers to industrial processors, are not were suited to the purpose. What the Court covered by the exemption, whereas self- has to assess is the validity of the suppliers and producers selling to farmer- Commission regulation in the light of the processors are. There is said to be discrimi­ general principle of equal treatment and nation between processors because those non-discrimination which, in the case of the who process and use cereals on their common agricultural policy, is laid down in holdings are exempt whereas those who particular in the second subparagraph of only process cereals, that is to say industrial Article 40 (3) of the Treaty and, for our manufacturers of compound feed, are not. purposes, in Article 4 (8) of Regulation No This system of exemption applies to 58% of 2727/75, as amended by Regulation No cereals intended for animal feed, a 1579/86. The latter provision provides that percentage which itself represents 60% of 'the Commission shall ensure that the the total quantity of cereals produced in the co-responsibility levy system does not create Community. any distortion with competing products'. It should also be borne in mind that, under Article 4 (6) of Council Regulation No 2727/75, as amended by Regulation No 1579/86, the levy is passed on to the producer and this rule is repeated in Article 5. As the Court is aware, the Commission 5 (1) of Commission Regulation No arrived at a result of such proportions by 2040/86, which is at issue in these the meaning which it gave, as it was proceedings. empowered to do by Article 4 (6) of Council Regulation No 2727/75, 6 as amended by Regulation No 1579/86, 7 to the term 'first-stage processing' and by interpreting, in its telex message of 5 September 1986, 8 the expression 'prod­ ucteur' as including any farmer, even a 7. It is precisely because the amount of the farmer not engaged in producing cereals. co-responsibility levy is passed on to the producer that there can be no question of discrimination between processors. The latter do not themselves bear the burden of the levy which is neutral as regards them. Since, moreover, the product involved is a 6. Although the effectiveness of the system surplus product and therefore one which is and its potential effects, whether direct or widely offered on the market, it is difficult indirect, particularly on the processing to see how producers could raise their prices industry, have been debated at length in the to compensate for the effect of the levy. written and oral observations submitted in One cannot therefore claim that its cost is connection with this reference, it is not a borne by the processing industry. question of judging whether the detailed

the surplus nature of the production in the practical difficulties of supervising trans­ question, it will only be induced to do so actions between farmers, are not such as to for commercial reasons which have nothing justify such a difference of treatment. to do with the requirements of the common 10. Therefore, the situation appears to me agricultural policy which underlie the to be this: existence and the rules for the application of the co-responsibility levy. In my view, there Regulation No 2040/86 cannot be invalid is therefore no discrimination between processors by reason of the co-responsibility (i) in so far as it makes producers, such as levy. the plaintiff in the main proceedings, subject to the co-responsibility levy in 9. The same cannot be said in the case of respect of their production intended to producers. Whilst one may understand the be industrially processed, and reasons justifying a general regime favouring self-suppliers, whose production is (ii) in so far as it exempts self-suppliers consumed by themselves and does not from the levy. contribute to the creation of surpluses, it is difficult to see, when one considers the The regulation is contrary to the principle raison d'être of the co-responsibility levy, the of equal treatment between producers justification for a system which is different inasmuch as it grants, not only to self- depending on whether the producer sells suppliers, but also to producers who sell cereals for processing to a farmer-processor their production to farmer-processors, an or to an industrial processor. The reasons exemption which it denies to other put forward by the Commission, relating to producers lawfully subject to the levy.