C-281/87

My Lords, detailed rules concerning inter alia the minimum quality and quantity required of each cereal in order for it to be eligible for intervention and the procedures and conditions for taking over by intervention 1. In these proceedings under Article 169 agencies. of the EEC Treaty, the Commission seeks a declaration that by instructing KYDEP (an organization of agricultural cooperatives) to purchase inferior-quality durum wheat of the 1982 harvest, without respecting the 3. Commission Regulation (EEC) No 1569/ Community intervention criteria, Greece has 77 fixing the procedures and conditions for failed to fulfil its obligations under Council the taking over of cereals by intervention Regulation (EEC) No 2727/75 on the agencies (Official Journal 1977, L 174, common organization of the market in p. 15) inter alia lays down the minimum cereals (Official Journal 1975, L 281, p. 1). quality requirements which cereals, including durum wheat, must meet in order to be accepted for intervention (Article 2 and the annex). In respect of certain defi­ nitions used in those quality criteria, Regu­ The legal and factual background lation No 1569/77 cross-refers to Annex I to Council Regulation (EEC) No 2731/75 fixing standard qualities for common wheat, rye, barley, maize and durum wheat (Official Journal 1975, L 281, p. 22). 2. Title I of Regulation No 2727/75 (as amended) provides for a single price system for cereals, including durum wheat. Under that system, the Council inter alia fixes annually a single intervention price for durum wheat for all Community inter­ 4. Article 2 of the Greek Law No 1541/85 vention centres (Article 3). Under on cooperative agricultural organizations Article 7(1), the intervention agencies provides for three levels of cooperatives. At designated by the Member States are the first, lowest level are agricultural obliged to buy in cereals which are offered cooperatives composed of individual to them and have been harvested in the producers. At the second, intermediate level Community, provided that the offers are regional associations of agricultural comply with conditions, in particular in cooperatives. At the third and highest level respect of quality and quantity, to be are national organizations of associations of determined in accordance with paragraph 5. agricultural cooperatives established on a Article 7(5) provides for the adoption by sectoral basis in respect of particular the Commission in accordance with the products or branches of production. Under management committee procedure of Article 52 of the law, the activities of

5. KYDEP is a third-level organization of agricultural cooperatives for the cereals, vegetables and animal feed sector. It appears 'After the measures announced for the from the file that the principal functions of collection of inferior-quality durum wheat KYDEP are the purchase of its members' of the 1982 harvest, and following the produce and the collection, storage and Decrees Nos 468082 of 23 June 1982 marketing of that produce. It further and 469049 of 2 July 1982, we request you appears from the file that since the Greek to proceed as follows to the purchase of all accession to the EEC in 1981, KYDEP has consignments of the said inferior-quality operated as an EEC intervention agency for durum wheat.' the cereals and rice sector by virtue of an agency agreement with the department of the Greek Ministry of Agriculture responsible for EEC intervention measures. The circular is then divided into two KYDEP's designation as EEC intervention subsections, the first dealing with durum agency is effected by a decision of the wheat for processing and the second with Minister of Agriculture which is renewed durum wheat destined exclusively for use as annually. animal feed. The circular lists minimum quality criteria in respect of each category and in respect of durum wheat for processing also sets out the conditions under which the purchase price will be reduced or 6. In the summer of 1982 the Greek alternatively under which a bonus will be Minister for Agriculture adopted two paid. The concluding paragraph of the decrees concerning intervention in respect circular states that the durum wheat of the of cereals in the 1982/83 marketing year. two categories described must be taken over Decree No 468082 of 23 June 1982 laid only from producers and from threshing down the qualitative requirements and enterprises and their staff and that procedures in respect of intervention buying merchants are excluded. The circular was of wheat, rye and barley on behalf of the copied for information to the regional intervention agency. Decree No 469049 of directorates of the Ministry of Agriculture. 2 July 1982 was concerned with the organ­ ization of intervention in respect of the taking over of the autumn 1982 cereals harvest. The recitals to both decrees refer to the relevant Community legislation and to Admissibility the designation of KYDEP as intervention agent for the cereals and rice sector. The conformity of those two decrees with the Community legislation is not in dispute in 8. In its defence to these proceedings, the these proceedings. Greek Government raises an issue of

9. As regards the question of commercial secrecy, it is sufficient to state that while that might be a ground for the confidential treatment of documents disclosed to the Court, it cannot be treated as a ground for the exclusion of documents from evidence. 11. The application in this case essentially In any event, the report of 4 November makes two allegations. The first, principal 1985 and the internal note of 6 June 1985 allegation is that the circular amounted to referred to are relied on by the Commission an instruction to KYDEP to carry out a in its application merely in support of the national intervention measure. The second, assertion that in the cereals sector KYDEP subsidiary allegation is that the wheat acts not only on its own account but also purchased in accordance with the circular carries out the instructions of the Greek was subsequently sold into Community Government, a fact which is hardly in intervention, in breach of Community dispute between the parties. As for the quality norms. This subsidiary allegation circular, on the assumption that it did does not feature in the summary of the amount to an instruction to intervene, then declaration sought by the Commission it clearly contemplated the exercise by which is given at the beginning and end of KYDEP of a public function, i.e. inter­ the application. Moreover, at the hearing vention, and cannot be regarded as the Commission agent acknowledged that confidential; on the assumption that it was the Commission's case rests essentially on intended purely to provide information for the issue of the circular and that the alleged Greek producers concerning the quality sale of the wheat into Community inter­ differences between wheat suitable for vention must be seen purely as an aggra­ processing and that suitable for animal feed vating factor. I will therefore deal only (as the Greek Government suggests), it is briefly with the question of the destination again difficult to see why such information of the wheat after first considering the should be regarded as confidential. primary issue of the circular.

12. The parties are essentially in dispute it by the Commission. This is already about the purpose of the circular. The apparent from the title and the opening and Commission argues that the circular was a concluding paragraphs of the circular, clear instruction to KYDEP to purchase the described above at paragraph 7. The first 1982 harvest in accordance with the paragraph contains a clear request to conditions as to quality, etc. set out therein. purchase a particular harvest and the final Since those conditions were different from paragraph includes instructions as to eligible (and, in practice, less strict than) the vendors. Both those paragraphs would be Community intervention criteria, the superfluous if the circular was indeed purely circular amounted to an instruction to carry intended for the information of producers. out a national intervention measure which The penultimate paragraph of the circular, was both in itself contrary to the common which deals with the storage of the wheat, organization of the market in cereals and would also be unnecessary in such a case. which was capable of interfering with the The circular was moreover addressed to Community intervention measures adopted KYDEP, and although it was copied for pursuant to that common organization. The information to the regional directorates for Greek Government has however consistently agriculture, it contained no request or argued that the circular served an infor instruction that any part of its contents mative and explanatory function. It explains should be transmitted to agricultural that in the course of the 1981/82 marketing cooperatives at a lower level or to year three regions of the country suffered producers. severe drought. As a result, the durum wheat harvest was small and of poor quality. Merchants bought up the harvest at low prices, telling producers that it was only fit for animal feed. Subsequently the producers learned that the wheat had been sold by the merchants for industrial processing.

common wheat. In contrast, Regulation No 1569/77 at the relevant time required: (a) a specific minimum weight of 76 kilo grammes per hectolitre; (b) a maximum of 50% of 'mitadiné' grains; and (c) a maximum of 4 % of grains of common wheat. Subsection 2 of the circular, dealing 13. In my view, there can be no doubt that with durum wheat destined exclusively for the circular did have the purpose ascribed to use in animal feed, lays down that no

17. As the Commission points out in its reply, Article 2(4) of Regulation 16. According to the well-established No 1569/77 provides for the possibility of case-law of the Court, the existence of a derogation from some of the quality common organization of the market requirements for Community intervention precludes national measures in the areas 'in the event of particularly unfavourable covered unless the Community legislation climatic conditions'. Following the drought provides otherwise. The Court has moreover in 1981/82, it was open to the Greek repeatedly ruled that once a common Government to invoke that provision rather organization of the market has been estab­ than to adopt its own derogating measures. lished, Member States must refrain from taking any measures which might derogate from or harm that organization. (See, for example, Case 111/76 Officier van Justitie v Van den Hazel [1977] ECR 901; Case 177/78 Pigs and Bacon Commission v 18. As regards the question of what MacCarren [1979] ECR 2161). There can be happened to the wheat bought up by

COMMISSION v GREECE

21. Accordingly, I conclude that the Commission is entitled to a declaration to the effect that by instructing KYDEP to purchase quantities of inferior-quality durum wheat from the 1982 harvest without respecting the conditions for Community intervention, the Hellenic Republic has failed to fulfil its obligations under Council Regulation (EEC) No 2727/75 on the common organization of the market in cereals; and that the Hellenic Republic should be ordered to pay the costs.