C-358/87
ECLI:EU:C:1989:39
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DREWES v BEZIRKSREGIERUNG LÜNEBURG
OPINION OF MR ADVOCATE GENERAL JACOBS delivered on 26 January 1989 *
My Lords, and replaced by other animals. In the course of his third year of participation in the scheme, Mr Drewes was asked to sign a declaration of conformity with the scheme rules with a view to payment of the second instalment of the premium. The declaration, signed on 6 November 1980, revealed that at that time he kept five dairy cows of 1. Mr Drewes, who owns a small farm in which only two had been duly marked. Lower Saxony, applied on 1 March 1978 for a non-marketing premium pursuant to Council Regulation (EEC) No 1078/77 introducing a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds (Official Journal 1977, L 131, p. 1). In his 3. It appears from the Order for Reference application Mr Drewes stated that there that the reason for this was that when the were 10 bovine animals on the farm, of officials of the Landwirtschaftskammer which seven were dairy cows. By decision of (Agricultural Board) came to mark the 4 April 1978 the Bezirksregierung Lüneburg animals, it was not possible to catch three of (Lüneburg District Administration), which them in order to attach the identifying tag was responsible at a local level for the to their ears. It was understood that the administration of the scheme, approved the animals would be marked before being sold, application. Mr Drewes indicated that he but in fact they were still unmarked when would cease marketing milk and milk sold for slaughter in January and February products on 1 September 1978 and by 1981. decision of 12 October 1978 the District Administration approved the payment to him of DM 4 663.63 by way of first instalment of the premium, the balance being payable by two further instalments at the end of the third and fifth years of 4. By decision of 30 November 1981, the participation in the scheme. Lüneburg District Administration withdrew its earlier decisions of 4 April and 12 October 1978 and required Mr Drewes to repay the whole of the first instalment of the premium on the ground that he had failed to comply with scheme rules requiring him to mark all the dairy cows kept by him 2. From the case file it appears that during his participation in the scheme. At Mr Drewes had the seven dairy cows first instance, the Verwaltungsgericht marked and registered, as required under (Administrative Court) of Stade overturned the Community legislation, and that in due the decision of the District Administration, course these cows were sold for slaughter ruling that the marking requirement did not
* Original language. English
OPINION OF MR JACOBS — CASE 358/87
constitute one of the fundamental obli (b) or, if not, as including the rules for gations of the scheme, breach of which checking compliance with those would justify total recovery, but rather obligations laid down pursuant to should be seen as a rule for verifying Article 7(e) of that regulation in compliance with the scheme obligations, a Article 7 in conjunction with partial breach of which could result only in Article 2(2)(b) of Commission a proportional reduction of the premium. Regulation (EEC) No 1307/77 of On appeal, the Oberverwaltungsgericht 15 June 1977, in particular the (Higher Administrative Court) of Lower marking and registration of animals Saxony and Schleswig-Holstein took the and the issue of identity cards for opposite view, holding that the marking them? requirement did form part of the funda mental obligations of the scheme and that it was therefore necessary to recover all the premium paid.
(2) Under Article 8(1) of Commission Regulation (EEC) No 1307/77 of 15 June 1977, sums already paid in respect of premiums are to be recovered where certain obligations are not 5. The case went on appeal to the Bundes complied with; is the term "obligations" verwaltungsgericht (Federal Administrative to be interpreted, in the case of Court), which stayed the proceedings and non-marketing premiums, as referring referred the following questions to the only to the undertakings (conditions) Court: provided for in Article 2 of Regulation (EEC) No 1078/77?
'(1) Pursuant to the first sentence of (3) Is the rule laid down in Article 8(3) of Anicie 11(1) of Council Regulation Commission Regulation (EEC) (EEC) No 1078/77 of 17 May 1977, No 1307/77 of 15 June 1977 in non-marketing premiums already paid respect of the failure of an applicant "to are to be recovered in cases where provide proof in accordance with certain undertakings have not been Article 7 that the animals have been fulfilled; is the term "undertakings" to used for the prescribed purposes" to be be interpreted interpreted as covering cases in which individual animals were not marked and registered and identity cards were not issued for individual animals?
(a) as referring only to the under takings (conditions) associated with the non-marketing premium in (4) In the event that the answer to Articles 1 and 2 of that regulation, question 1(b) is in the affirmative and
DREWES v BEZIRKSREGIERUNG LÜNEBURG
the answer to question 3 is accordingly cases where the undertakings provided for in the negative: have not been fulfilled'. Article 7 of the same regulation provides for the adoption in accordance with the management committee procedure inter alia of 'rules for verifying that undertakings arising from the grant of In so far as the first sentence of the premium have been fulfilled' Article 11(1) of Regulation (EEC) (subparagraph (e)). No 1078/77 provides for the with drawal of the entire premium even in the event of an inadvertent failure to mark and register a single female bovine animal acquired for fattening after the approval of the premium, regardless of whether or not compliance with the 8. Commission Regulation (EEC) undertakings (conditions) referred to in No 1307/77 (Official Journal 1977, L 150, Article 2 of that regulation is proved by p. 24; 'the Commission Regulation') lays other means, is it compatible with the down detailed rules for the application of principle of proportionality as applied in the system of premiums. Article 2(2)(b) Community law?' provides that the competent authority inter alia shall 'mark and register the holding's dairy herd and issue for the animals concerned the identity cards provided for in Article 7 . . .'. Article 5(1)(b) defines 'dairy 6. With a view to reducing the surplus on herd' as 'all female domestic bovine animals the Community market, Council Regulation at least six months old suitable for the No 1078/77 ('the Council Regulation') production of milk for marketing'. introduced a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds to meat production. Article 2 of that regu lation relates to the non-marketing premium, Article 3 to the conversion 9. Article 7 deals in detail with identity premium. Under Article 2(2) of that regu cards. Paragraph 1 provides as follows: lation, grant of the non-marketing premium is conditional upon a written undertaking by the producer not to dispose of milk or milk products from the holding, whether for consideration or free of charge, for a period of five years. In addition, the producer had to undertake not to allow his holding to be 'For purposes of checking compliance with used by any third party for dairy farming, the obligations under the premium scheme, or to lease his dairy cattle or to dispose of an identity card shall be issued in at least them except for slaughter or export. one original and one copy for each animal marked and registered in accordance with Article 2(2)(b); the original shall accompany the animal concerned throughout the non-marketing or recon 7. Article 11(1) requires Member States to version period, or until slaughter or export; 'take the measures necessary for the the copy shall be kept by the issuing recovery of the premiums already paid in authority.'
OPINION OF MR JACOBS — CASE 358/87
Paragraph 4 requires applicants for aid to purposes, entitlement to the premium shall obtain an identity card for each bovine be forfeited in respect of those animals for animal as defined in Article 5(l)(a) and (b) which such proof is not furnished.' and to keep such card for as long as they are subject to the obligations arising out of the premium system. In the case of change of ownership, details of the new owner are to be entered on the card if the scheme obli gations still apply to the animal concerned (paragraph 5). In the case of export, the 11. The legislation referred to above does customs authorities are to stamp the card not deal in express language with the legal and arrange for return to the producer consequences of a partial failure to mark (paragraph 7). In the event of the slaughter cows in accordance with scheme provisions. or death of the animal during the relevant In the absence of an express provision, the period, the competent authority is to certify national court asks whether such a failure the date of slaughter or death on the card must be seen as a breach of an 'undertaking' and arrange for the return of the card in terms of Article 11(1) of the Council to the producer (paragraph 8). Under Regulation, or of an Obligation' in the Article 7(9), 'death or export shall not be meaning of Article 8(1) of the Commission regarded as proved until the recipient of the Regulation, with the consequence in either premium returns the original of the identity case that the whole premium is forfeit (first card stamped or certified in accordance with and second questions). Alternatively, the paragraphs 7 and 8.' national court asks whether the failure to mark should be seen as a failure to provide proof that animals have been used for the prescribed purposes in accordance with 10. Anicie 8 of the Commission Regulation Article 8(3) of the Commission Regulation, is concerned with breach of scheme with the result that entitlement to premium requirements and the recovery of premiums. is forfeited only in proportion to the extent Paragraph 1 provides as follows: of the breach (third question).
'Where the recipient of a premium fails to prove to the satisfaction of the competent authority that he has complied with the obligations laid down in Article 2 or 3 of Regulation (EEC) No 1078/77, the 12. Article 11(1) of the Council Regulation Member State concerned shall take all provides for recovery by Member States of necessary steps to recover all sums already premiums already paid in 'cases where the paid in respect of that premium.' undertakings provided for have not been fulfilled'. The essential question which arises is whether the term 'undertakings provided for' refers only to the obligations assumed Under Article 8(3): by a farmer, as a condition of the grant of premium, pursuant to Article 2 or 3 of the Council Regulation or includes also any further requirements deriving from 'Where the applicant fails to provide proof Commission implementing rules, notably in accordance with Article 7 that the rules laid down, pursuant to Article 7(e) of animals have been used for the prescribed that regulation, 'for verifying that under-
DREWES v BEZIRKSREGIERUNG LÜNEBURG
takings arising from the grant of premium regulation, must be seen as a secondary have been fulfilled'. obligation the essential function of which is to monitor compliance with the primary scheme obligations. According to the estab lished case-law of the Court, as stated recently in Case 181/84 E. D. & F. Man (Sugar) Ltd v Intervention Board for Agri- cultural Produce [1985] ECR 2889, and in Case 21/85 Maas v Bundesanstalt für land- 13. In my view, the wording of wirtschaftliche Marktordnung [1986] Article 11(1) supports a narrow interpre ECR 3537, where Community legislation tation of the relevant term. The reference to makes a distinction between primary and 'undertakings' clearly echoes the references secondary obligations, it cannot, without to 'written undertaking' in Article 2(2), to breaching the principle of proportionality, 'undertaking' in Article 3(2) and to 'the penalize failure to comply with a secondary undertakings' in Article 4(1) of the Council obligation as severely as a failure to comply Regulation. In addition the words 'provided with a primary obligation. To admit that a for', at any rate in the English and French breach of the marking requirement is texts, indicate that the relevant obligations contemplated by Article 11(1) would have have already been constituted, rather than precisely that consequence. have yet to be constituted under later implementing legislation.
15. The suggested view of the scope of Article 11(1) is moreover consistent with the Court's judgment of 22 September 1988 14. The narrow interpretation of in Case 199/87 Jensen v Ministry of Agri- Article 11(1) is also in accordance with the culture [1988] ECR. In that case, ruling inter structure of the Community legislation, alia on the interpretation of Article 11(1), taken as a whole, and with the principle of the Court held that the undertaking, proportionality developed in the case-law of contained in Article 2 of the Council Regu the Court. As pointed out in the written lation, not to market milk or milk products observations submitted by the Council, the for five years, must be seen as the essential Commission and the French and German legal justification for the grant of premium, Governments, the relevant Community with the result that even a partial failure to legislation rests on a classic distinction comply with that undertaking must result in between primary obligations — compliance recovery of all the premium paid (consider with which is essential to achieve the ations 30 and 31). objectives of that legislation — and secondary obligations, which are essentially of an administrative nature, and breach of which does not go to the root of the legis lation. In that context, the primary obli gations are clearly those which form the subject of the farmer's undertakings pursuant to Article 2 or 3 of the Council 16. I am therefore of the view that the first Regulation, whereas the marking question must be answered in the sense that requirement, which does not figure in that the first interpretation is to be preferred
OPINION OF MR JACOBS — CASE 358/87
17. Similar considerations prompt a wider view, use 'for the prescribed purposes' negative reply to the second question. means not just use for export or slaughter, Anicie 8(1) of the Commission Regulation but more generally use in compliance with provides for recovery of all sums already the scheme requirements; since the different paid in cases where the producer fails to identification requirements (marking, regis establish that he has complied 'with the obli tration and issue of identification cards) are gations laid down in Article 2 or 3 of Regu all concerned with proof of compliance in lation (EEC) No 1078/77'. The provision that general sense, the partial failure to fulfil refers exclusively to Articles 2 and 3 of the any of those requirements should result only Council Regulation, without mentioning in proportional recovery in accordance with any further requirements to be laid down Article 8(3). I would add that the Jensen pursuant to Article 7 of that regulation or judgment does not directly assist us here, indeed any specific provision of the since that case, in so far as it is relevant to Commission Regulation. Moreover, to the present one, was concerned with the admit that Article 8(1) also covers the consequences of breach of a primary scheme failure to comply with the marking obligation, i. e. the non-marketing under requirement would once again result in the taking itself. penalization of the breach of a secondary obligation at the same level of severity as that of a primary obligation.
19. Viewed in isolation, the wording of Article 8(3) and of Article 7 appears at first sight to support the narrow interpretation. 18. There therefore remains only While Article 8(3) refers back to Article 7 Article 8(3) of the Commission Regulation in general, and not just to Article 7(9), the as a possible basis for recovery in the event only purposes actually 'prescribed' in of breach of the marking requirement. Article 7 are the slaughter or export There are two possible views of the scope of referred to in paragraph 9. Moreover, that provision which depend on different Article 8(3) refers to forfeiture of premium interpretations of the words 'proof ... that in respect of those animals 'for the animals have been used for the which ... proof is not furnished': the only prescribed purposes' in Article 8(3). The reference to furnishing of proof in Article 7 first, narrow view is that those words refer is again in paragraph 9 of that article. In back to Article 7(9) of the Commission addition, the wording of Article 7(1), which Regulation, with the result that proportional provides for the issue of identity cards 'for recovery of the premium is available only in each animal marked and registered in the case where a farmer cannot prove, by accordance with Article 2(2)(b)', appears to production of the duly stamped or certified indicate that marking and registering must original of the identity card, that a cow has have taken place before Article 7 even been slaughtered or exported in accordance becomes relevant. According to this view, with scheme rules. According to the second, breach of the marking requirement cannot
DREWES v BEZIRKSREGIERUNG LÜNEBURG
therefore be seen as failure to provide proof Commission Regulation indicates that those 'in accordance with Article 7'. requirements have a common function — 'to provide a means of identification' — and a common purpose — 'to ensure that a check 20. However, as soon as Article 8(3) is can be kept throughout the period to which viewed in the context of the legislation as a the obligations under the scheme relate'. whole, it is plain that it cannot bear such a Moreover, the wording of Article 7 makes narrow interpretation. it plain that marking and registration are a precondition for the issue of an identity card, so that failure to mark and register an 21. It is apparent from Articles 2 and 3 of animal will inevitably result in failure to the Council Regulation that export or obtain an identity card. Given that inter slaughter are not the only uses 'prescribed' relationship and identity of purpose, it by the legislation. In fact all the primary would be illogical for the legislation to scheme obligations contained in those provide for proportional recovery in the provisions — such as the obligation not to case of failure to provide proof of export or lease dairy cattle or allow the holding to be slaughter, but not to make similar provision used for dairy farming — are concerned for cases of failure to comply with other with the use of cows and restrictions on that identification requirements. use.
23. I am therefore of the view that the third 22. It is also apparent from the legislation question must be answered in the that the different identification requirements — marking, registration and affirmative. the issue of identity cards — are so closely related that they cannot sensibly be distin guished from one another as regards the 24. In view of the suggested reply to the consequences of breach of any one of the first and third questions, it is not necessary requirements. The second recital to the to reply to the fourth question.
25. Accordingly , in my opinion the questions referred by the Bundesverwaltungs gericht should be answered as follows:
'(1) The term " undertakings " in Article 11(1) of Council Regulation ( EEC ) No 1078 / 77 must be interpreted, in the case of non-marketing premiums, as referring only to the undertakings (conditions) associated with the non-marketing premiums in Articles 1 and 2 of that regulation .
OPINION OF MR JACOBS — CASE 358/87
(2) The term "obligations" in Article 8(1) of Commission Regulation (EEC) No 1307/77 must be interpreted, in the case of non-marketing premiums, as referring only to the undertakings (conditions) provided for in Article 2 of Regulation (EEC) No 1078/77.
(3) Article 8(3) of Commission Regulation (EEC) No 1307/77 must be inter preted as covering cases in which individual animals were not marked and registered and identity cards were not issued for them.'