C-127/94

1 — Council Regulation of 27 June 1968 (OJ 1968 L 148, p. 13). 2 — Council Regulation of 17 May 1977 introducing a system of premiums for the non-marketing of milk and milk products * Original language: French. and for the conversion of dairy herds (OJ 1977 L 131, p. 1).

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products from their holdings for a period of 7. Article 6 of that same regulation laid five years ('non-marketing premiums'). down the rules applicable to transfers. Any person taking over an agricultural holding could claim the balance of the premium allo­ cated to his predecessor, provided that he undertook in writing to continue to carry out the undertakings given by his prede­ cessor. 6. Article 4(1) of that regulation laid down the amount of those premiums and pre­ scribed the method for paying them as fol­ lows:

8. In 1984 it was found that, despite the measures established in 1977, there contin­ ued to be an inexorable increase in milk pro­ duction. Since it had become necessary to 'The non-marketing premium shall be calcu­ adopt more rigorous measures, the common lated on the basis of the quantity of milk or organization of the market in milk and milk its equivalent in milk products delivered by products was therefore radically amended by the producer during the 1976 calendar year. the introduction of the supplementary levy scheme, also referred to as the 'milk quota scheme'.

(...)

11. The general rules for the application of the additional levy were established by Regulation (EEC) No 857/84. 5 In the 14. In order to comply with those judg­ United Kingdom, the reference quantity was ments, the Council adopted Regulation 9 fixed on the basis of the 1983 calendar year. (EEC) No 764/89, which inserts a new Article 3a into Regulation No 857/84. That article provides for the provisional allocation of a special reference quantity (commonly called 'Slom quota') to certain categories of producers who had taken part in non- marketing schemes and who satisfied certain conditions. 12. That system did not provide for the pos­ sibility of allocating a quota to producers who, because of their participation in the temporary non-marketing system provided 6 — The expression 'Slom' comes from the Dutch 'slachtoffers omschakeling' which means 'conversion victims'. The acro- for by Regulation No 1078/77, had not nym SLOM was previously used in Netherlands practice. It comes from 'stoppage of delivery and conversion of milk delivered or sold milk during the reference production'. year adopted for the allocation of quotas 7 — Case 120/86 Mulder v Minister van Landbouw en Visserij [1988] ECR 2321. 8 — Case 170/86 Von Deetzen v Hauptzollamt Hamburg-Jonas [1988] ECR 2355. 9 — Regulation of 20 March 1989 amending Regulation (EEC) 5 — Council regulation of 31 March 1984 adopting general rules No 857/84 adopting general rules for the application of the for the application of the levy referred to in Article 5c of levy referred to in Article 5c of Regulation (EEC) No Regulation (EEC) No 804/68 in the milk and milk products 804/68 in the milk and milk products sector (OJ 1989 L 84, sector (OJ 1984 L 90, p. 13). p. 2).

16. Article 3a(2) fixed the amount of special reference quantity at 60% of the quantity of milk delivered by the producer during the 12 calendar months preceding the month in which the application for the non-marketing premium had been made, provided that the 20. In Case C-189/89 Spagl ν Hauptzollamt 10 producer had not lost his entitlement to the Rosenheim and Case C-217/89 Pastätter ν 1 premium (the '60% rule'). That provision Hauptzollamt Bad Reichenhall, 1the Court also laid down rules concerning the amount thus annulled Article 3a(l) and (2), taking of the quota to be allocated, both to the the view that they infringed the legitimate transferor and the transferee, where part of a expectations of producers who had taken holding had been transferred during the part in the non-marketing scheme, since they course of the non-marketing period. provided for the non-allocation of Slom quotas to producers whose period of non- marketing expired before 31 December 1983, and for the 60% rule respectively.

21. The judgment in Case C-314/89 Rauh ν 12 17. Article 3a(3) specified the conditions Hauptzoüamt Nürnberg-Fürth (herein­ upon which a provisional special reference after 'the judgment in Rauh') clarified the quantity could become definitive: the need to transfer arrangements. In that case, the achieve production of 80% of the quota allo­ cated within two years from 29 March 1989, failing which the producer lost his right to 10 — [1990] ECR I-4539. quota and it returned to the Community 11 — [1990] ECR I-4585. ' reserve (the 'all or nothing rule ). 12 — [1991] ECR I-1647.

23. It was precisely with regard to the last rule that the Court was asked to give another — abolishes the 60% rule; preliminary ruling. In the judgment in Case C-264/90 Wehrs v Hauptzollamt Lüne- 14 burg (hereinafter 'the judgment in Wehrs') the Court held that the anti-accumulation rule in the second indent of Article 3a(l) was invalid in so far as it barred from the alloca­ — abolishes the all or nothing rule (the tion of Slom quotas the Slom producers principle of 80% is retained, but if it is (called 'Slom III') who had taken over a not achieved, the quota does not return holding participating in the non-marketing to the Community reserve; the producer system under Regulation No 1078/77, if those producers (transferees of non- marketing premiums) had already received a 13 — Regulation of 13 June 1991 amending Regulation (EEC) No 857/84 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1991 L 150, p. 35). 14 — [1992] ECR I-6285.

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quota under the general rules laid down by 26. All those provisions form the backdrop Regulation No 857/84. In the judgment in to the facts of the two disputes at the origin Twijnstra ν Minister van Landbouw, Natur- of the present request for a preliminary 15 beheer en Visserij the Court held that ruling. where there had been a partial transfer of an undertaking participating in the non- marketing system, Article 3 a had to be inter­ preted as meaning that it permitted the Slom quota to be divided between the transferor and the transferee in proportion to the land Facts transferred.

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such a scheme, it was nevertheless the case premium, which was not the position in that Ecroyd Ltd was bound by that under­ which Ecroyd Ltd found itself. taking when it became the sole remaining partner of the group which had made up Credenhill Farming. There had been no transfer of the undertaking from Credenhill Farming to Ecroyd Ltd for the purposes of Article 6 of Regulation No 1078/77, so that 36. In that context, the High Court has sub­ it was unnecessary for Ecroyd Ltd, which mitted the following questions to the Court: had observed the terms of the non-marketing undertaking, to enter into another undertak­ ing. Secondly, Ecroyd Ltd considered that the Ministry's argument based on the anti- accumulation rule could not succeed in the light of the judgment in Wehrs. '1 . Does the respondent Ministry have a power and/or duty to award a provi­ sional special reference quantity to the applicant and/or to treat it as if it had been awarded special reference quantity:

(c) following the departure of the other 3. If the answer to Question 2 is that Arti­ members of the partnership, the cle 3a(l) of Regulation No 857/84 is applicant did not produce milk on unlawful and invalid to the extent that it the holding for the remainder of excludes the applicant from an award of the period of the original non- milk quota, does the respondent Minis­ marketing scheme entered into by try have the power and/or duty to the partnership; award milk quota to the applicant and/or to treat it as if it had been awarded special reference quantity, before the enactment of further Com­ munity legislation to cure or take (d) no fresh written undertaking was account of the invalidity of the measure given by the applicant, following in question? the departure of the other members of the partnership, pursuant to Article 6 of Council Regulation No 1078/77 to carry out the non- marketing undertaking given by the partnership; If so, when does or did such power and/or duty arise?

(e) the applicant had received primary quota in respect of a separate hold­ 4. If the answer to the above questions is ing. that the respondent Ministry had the

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power and/or duty to award a special operated it under a non-marketing scheme reference quantity to the applicant from 14 November 1980 until its dissolution and/or to treat it as if it had been on 30 September 1984. With effect from that awarded special reference quantity, date, that farm, like the three others, was before such time as the Council of Min­ operated by Ecroyd Ltd, which observed the isters has adopted fresh legislation non-marketing undertaking until the and/or following the decision of the required date, 13 November 1985. Court in Case C-264/90 Wehrs, is the applicant entitled in principle to dam­ ages from the respondent Ministry for having failed to grant him a special ref­ erence quantity?

UKL 40 877 as an equalization payment rep­ the conditions for obtaining a special refer­ resenting the difference between the value of ence quantity as laid down in Regulation No the share in the trust fund to which he was 764/89 or Regulation No 1639/91. First of entitled under the Children's Settlement and all, since he had not taken part in a non- the value of the property assigned (valued at marketing premium scheme, he could not be approximately UKL 250 000). entitled to a Slom I quota under those regu­ lations. Nor was he in the position of an assignee of premium who had assumed the assignor's non-marketing undertaking. Finally, he was not entitled to the grant of Slom II quota, since none of the necessary conditions were satisfied. First, since he had 42. On 25 September 1991 John Ecroyd, acquired the holding only on 22 December describing himself as successor to Credenhill 1989, he did not fall within the period laid Farming, made an application for Slom II down by Regulation No 1639/91, which quota for Lyvers Ocle. The Ministry rejected requires the holding to have been acquired his application on the ground that the trans­ by way of inheritance before 29 June 1989. fer had taken place after 29 June 1989 and Secondly, the predecessors in title of the did not therefore give him the status of 'suc­ applicant as owner were the trustees of the cessor' under the provisions of Regulation Children's Settlement, who had not taken No 1639/91. part in a non-marketing scheme. Finally, the applicant did not receive Lyvers Ocle by way of inheritance, but rather in satisfaction of his interests in the trust fund.

(ii) following the decision of the Court in Case C-264/90 Wehrs, (e) all of the other members left the Credenhill farming partnership before the expiry of the period of the non-marketing scheme and the holding in respect of which the non- where: marketing undertaking was given by the partnership was thereafter farmed by H . & R. Ecroyd Ltd for its own account;

(a) the applicant was the beneficiary of the Children's Settlement compris­ ing inter alia land and became ben­ eficially entitled to his share of that settlement on his 25th birthday in 1983;

(b) the land in question was let by the trustees of the Children's Settlement (f) Credenhill Farming, and subse­ to, and farmed by, H . & R. Ecroyd quently H . & R. Ecroyd Ltd, abided Ltd; by the terms of the non-marketing undertaking. In particular, following the departure of the other members of the partnership, H . & R. Ecroyd Ltd did not produce milk on the (c) part of the land was in turn sub-let holding for the remainder of the to and farmed by a partnership, period of the original non-marketing Credenhill Farming, comprising scheme entered into by the partner­ inter alia H . & R. Ecroyd Ltd; ship;

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(g) no written undertaking was given (k) the said transfer was subject to an by H . & R. Ecroyd Ltd, following equalization payment by the'appli­ the-departure of the other members cant to the trustees representing the of the partnership pursuant to Arti­ difference between the value of the cle 6 of Council Regulation No applicant's entitlement under the 1078/77 to carry out the non- Children's Settlement and the value marketing undertaking given by the of the land transferred, taking into partnership; account the absence of special refer­ ence quantity in relation thereto.

46. In each of these two cases, the national court requests the Court of Justice to give a preliminary ruling, in substance, on the three following points:

If so, when does or did such power and/or duty arise?

(1) Were the applicants entitled to Slom quotas, either on the basis of a correct interpretation of the rules in force, or because of the invalidity, in the light of the judgment in Wehrs, of the rules pre­ venting such entitlement? 5. If the answer to the above questions is that the respondent Ministry had the power and/or duty to award a special reference quantity to the applicant and/or to treat him as if he had been awarded special reference quantity, before such time as the Council of Min­ isters has adopted fresh legislation (2) If the first question is to be answered in and/or following the decision of the the negative, were the national authori­ Court in Case C-264/90 Wehrs, is the ties obliged to grant the applications for applicant entitled in principle to dam­ quotas simply by drawing the appropri­ ages from the respondent Ministry for ate conclusions from the judgment in having failed to grant him a special ref­ Wehrs, without awaiting the action of erence quantity? the Community legislature?

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(3) If the national authorities were in fact elsewhere. It must therefore be considered obliged to grant a milk quota following whether those two conditions are satisfied in the judgment in Wehrs, to what extent the present case. are they liable in that respect?

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was not a change of that type which 54. As I have observed, Article 6 of Regu­ occurred on 30 September 1984. According lation No 1078/77 enables any person who to the documents before the Court, what takes over an agricultural holding to under­ occurred was the dissolution of Credenhill take in writing to continue to carry out the Farming, which is of a quite different nature. undertakings given by his predecessor. Although it is true that the producer who succeeded it was one of the legal persons who had previously been a partner in it, it is nevertheless the case that, following the dis­ solution, it was a new producer who oper­ ated the holding. The 'producer' who had signed the initial non-marketing undertaking 55. The United Kingdom believes it can rely no longer existed at the date when the appli­ on the fact that Ecroyd Ltd did not give such cation was made for a Slom quota. a formal undertaking when it succeeded to Credenhill Farming.

56. In that regard, the applicant claims that 52. It should also be noted that if Ecroyd each of the partners gave an individual Ltd and Credenhill Farming were to be undertaking when the undertaking was given regarded as one and the same 'producer', it by Credenhill Farming in 1980. It therefore would then be necessary to accept that the considers that its own signature at that time non-marketing undertaking had not been was sufficient to formalize its undertaking. complied with on the holding, as defined in 21 Article 5(b) of Regulation No 1078/77, since production continued on five farms.

order to put a brake on the growth of a mar­ 60. However, in order to be entitled to a ket characterized by large and increasing sur­ special reference quantity under Article 3a, pluses. In order to do so, producers were to the producer must also satisfy another con­ be encouraged to refrain from marketing dition, namely that he has not received a ref­ their production, the grant of a premium erence quantity elsewhere. In the present compensating for the loss of income result­ case, the same producer who had taken part ing from the marketing of the products in in the non-marketing scheme in respect of 22 question. The aim of the scheme applicable the holding comprising four farms, had to transfers provided for by Regulation No obtained a primary quota elsewhere in 1078/77 is no different. In that case too, respect of the five farms on which it had there is in practice a contract made between continued to carry out milk production. the Community and a producer. The pro­ Consequently, Ecroyd Ltd did not satisfy ducer, in a way, undertakes, in the general the second condition laid down by the rules interest, to cooperate in reducing excess in force at the material time. Even if the anti- Community production by continuing to accumulation rule were subsequently to be carry out the undertaking given by his pre­ declared invalid, it was of course not for the decessor, while the Community grants him a respondent Ministry to anticipate such inval­ premium by way of compensation. In the idity, since the Court of Justice has held that present case, Ecroyd-Ltd fulfilled its 'part of 'every regulation-which is brought into force the bargain'. To refuse to admit this, merely in accordance with the Treaty must be pre­ because it did not observe the formal con­ sumed to be valid so long as a competent dition of giving a written undertaking, seems court has not made a finding that it is 23 to *me to be especially inflexible and, above invalid'. all, contrary to the spirit of the scheme for cooperation between the Community and the producers which was established in order to secure adherence to the aim pursued.

entitled to a Slom quota under that same The reply to the national court's questions provision, Article 3a(l), after the delivery of should therefore be that the second indent of the judgment in Wehrs. Article 3a(l) of Regulation No 857/84, as amended by Regulation No 764/89, is invalid in so far as persons taking over a premium granted pursuant to Regulation No 1078/77 are barred from allocation of a spe­ cial reference quantity if they have received a reference quantity under Article 2 of Regu­ 24 lation No 857/84.' 63. In the case giving rise to that judgment, the applicant, Mr Wehrs, had obtained a ref­ erence quantity under Regulation No 857/84. He had applied for an increase in that quantity on the ground that, before the entry into force of Regulation No 857/84, he had purchased land in respect of which he had continued the conversion undertaking given by the former owner on the basis of Regulation No 1078/77. That application had 65. The question which arises is, in short, been refused because of the anti- whether or not the national authorities were accumulation rule laid down in Article 3a(l) required to give full effect to that finding of of Regulation No 857/84, as amended by invalidity before a new measure had been Regulation No 764/89. adopted in order to remedy the situation. What in fact fall to be considered are the effects vis-à-vis national authorities of a judgment declaring a Community measure to be invalid.

64. The Court, which had been asked to give a preliminary ruling on the validity of that provision, held that:

work of a reference to the Court for a pre­ liminary ruling, Articles 174 and 176 contain clear rules as to the effects of the annulment of a regulation within the framework of a direct action. Thus Article 176 provides that the institution whose act has been declared 70. It is true that a declaration of invalidity void shall be required to take the necessary gives rise to certain effects which are com­ measures to comply with the judgment of parable to those flowing from a judgment the Court of Justice. In its judgments of annulling a measure. 19 October 1977 in Joined Cases 117/76 and 16/77 (Ruckdeschel and H ansa-Lagerhaus Stroh (Quellmehl) [1977] ECR 1753) and in Joined Cases 124/76 and 20/77 (Moulins et Huileries de Pont-à-Mousson and Providence 71. Thus the national courts are obliged to Agricole de la Champagne (Maize Groats uphold the objection of illegality which led and Meal) [1977] ECR 1795) the Court has to the reference for a preliminary ruling and already referred to that rule within the to disapply the measure contested in the context of a reference to it for a preliminary main proceedings. 26 ruling.'

72. Similarly, the invalidity established is 68. However, although the Court carries out binding on any other national court adjudi­ the same kind of review on a reference for a cating on the same dispute as a result of an preliminary ruling on the validity of a meas­ 28 appeal or other domestic legal remedy. As ure as it does in an action for annulment, the regards national courts, such decisions inval­ consequences of that review are different. idating a measure also have a retroactive effect — but their retroactive nature does not mean that they are in the nature of decisions annulling measures: 'quite simply, the 69. An act which is annulled following an national court is empowered to give retroac­ action brought under Article 173 is declared tive effect to the invalidity of the measure

73. Finally, the national authorities which adopted national measures on the basis of, or in order to apply, the measure declared 31 76. However, the mere finding that a Com­ invalid must revoke them. munity measure is invalid is not always suf­ ficient to eliminate the illegality of the legal rule at issue. In order to remove the illegality which has been shown to exist, complex adjustments may be necessary or there may 74. Nevertheless, with the exception of the be a need for a choice between different last case, the effects of a judgment invali­ options to be made by the Member States dating a measure must, as regards the national acting together, which cannot be left to the authorities, be distinguished from those of a discretion of each national authority without judgment annulling a measure: whereas a creating a risk of upsetting the coherence of judgment annulling a regulation extends its the Community system established. It seems effects to the annulled regulation itself by to me that the declaration of the invalidity of rendering it void, that is to say by elimin­ the anti-accumulation rule in the judgment ating it from the legal system, a judgment in Wehrs ought to be viewed in such a con­ declaring a regulation invalid is intended to text. To be persuaded of this one has merely produce effects principally vis-à-vis the to bear in mind the full complexity and the courts, should they be called on to apply that imbrications of the whole corpus of Com­ regulation. munity legislation on the common market in milk and milk products, and the adjustments made necessary, at the level of the Council, by the invalidation of the anti-accumulation rule and brought about through the adoption 75. It is quite conceivable that the declara­ of Regulation No 2055/93. tion of invalidity made by the Court is suf­ ficient in itself, because it simply removes the legal basis for the imposition of certain obli­ 32 gations, such as the payment of a duty. In such a case, the national authorities have a

78. However, it should be borne in mind sary, in other regions; or to make a 'levy' on that, with a view to putting a brake on the the national reserve... increase in production, the Community rules introduced fix the .amount of the global guar­ anteed quantity at Community level, that amount being then allocated between the various Member States, which in turn allo­ cate the amount thus received amongst their 81. But even if those authorities had used national producers. The global quantity is one or other option, on what basis could therefore different for each Member State they have assessed the quantity to be allo­ and it constitutes the absolute limit below cated? And if they had nevertheless been which the Member State must remain when able to overcome all those obstacles, how allocating reference quantities. could they be sure of acting in a manner which was consistent with the rules which would subsequently be adopted, while also observing the essential aim pursued, namely, to limit surplus production? The difficulties resulting from the different solutions which might be adopted from one State to another can also be imagined... 79. It follows that the national authorities could evidently not have arbitrarily decided to allocate a reference quantity fixed by themselves.

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84. However, palliatives do exist. Thus and also that: recourse could be had to putting the Com­ munity's liability in issue. Similarly, if the Community institutions were to refrain from adopting measures to put an end to the invalidity declared by the Court, they would run the risk of their conduct being penalized 'however, the above answer [rinding the by the bringing of an action for a declaration regulation to be invalid] will leave the Coun­ of their failure to act. cil free to take any necessary measures com­ patible with Community law for ensuring 35 the proper functioning of the market [...]'.

85. In that regard, the Court provides an answer to the above objection by indicating that the author of the invalid regulation, be it 87. In conformity with that line of decisions, the Council or the Commission, is required the Council, after the judgment in Webrs, to draw, on its own responsibility, the appro­ and, moreover, without the Court having priate conclusions from the Court's judg­ had to make the point, had no alternative but ment in accordance with Article 176 of the to adopt a new Community measure in EC Treaty. order to cure the invalidity declared by the Court. Prior to the adoption of Regulation No 2055/93, the national authorities could not anticipate the precise limits and condi­ tions for the grant of quotas for which it provided. 86. Thus the Court has held that:

'[...] it is for the competent institutions of the 88. To conclude on the first question, the Community to adopt the necessary meas­ reply should therefore be that in neither of ures. The need for a reply to this effect [...] the two situations referred to by the High is borne out by the existence of several Court of Justice did the respondent Ministry, courses of action which would enable [the the competent national authority, have a invalidity established to be cured] and by the power or a duty to award a provisional spe­ fact that it is for the institutions responsible cial reference quantity to the applicant, or to for the common agricultural policy to assess treat it as if it had been awarded such a the economic and political considerations on quantity. 34 which this choice of action depends;'

Question 3

94. I would merely observe that, if it were necessary to consider any liability in dam­ ages, it would be the liability of the Commu­ nity which would fall to be considered. What is more, may I add, the applicant in this case brought an action in 1992 for damages 91. The third question seeks to establish against the Community, which is at present 37 whether the national authorities were under pending before the Court of First Instance. a duty to draw the appropriate conclusions from the invalidity of Article 3a(l) before the adoption of further Community legisla­ 36 — Point 62 et scq. above. tion. 37 — See paragraph 56 of the Commission's observations.

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Replies to the questions in the John Ecroyd 97. Could the applicant nevertheless regard case his situation as being different after the amendment of Regulation No 857/84 by Regulation No 1639/91, which was adopted in particular as a result of the judgment in Rauh?

Question 1

96. Let me point out at once that under Article 3a(l) of Regulation No 857/84, as 99. In the present case, the applicant did amended by Regulation No 764/89 alone, indeed submit his application within the the applicant could lay no claim to the award period prescribed (25 September 1991). of a special reference quantity. That provi­ However, may he be regarded as having sion envisaged that only two categories of received, before 29 June 1989, through an producers could claim it: those who had inheritance or similar means, the holding of a given a non-marketing undertaking and person who had entered into and observed a those who had taken over the holding of per­ non-marketing undertaking? sons originally entitled during the non- marketing period and who had also taken over that obligation on their behalf. The applicant began production in 1987 on Lyvers Ocle, merely as subtenant of Ecroyd Ltd, after the expiry of the non-marketing period. He did not therefore fall ratione per- sonae within the scope of the provisions then 100. The concept 'inheritance or similar in. force. means' fell within the contemplation of the

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It follows that neither the contribution of a holding to a private company in which the producer to whom the special reference quantity was granted has a share nor the fact that, under German law, the latter's share in 102. In that regard, let me merely point out, the company accrues to the other members first of all, that the fact that in 1983 John following his death or withdrawal from the Ecroyd acquired, at the age of 25, the right company nor the leasing of the holding, to to a share in the Children's Settlement can­ the potential beneficiary of the estate of the not be regarded as an inheritance or similar producer to whom the special reference transaction. At that date, the applicant was quantity was granted can be excluded from merely the holder of a. right to obtain a cer­ the definition of "any similar transaction", tain proportion of the trust property, but not provided that the conditions of the contract yet a separate or specific part. When the embodying the transaction in question are property was divided between him and the such that they place the potential beneficiary other beneficiaries, several possibilities were in a privileged position compared with that of an operator taking over a comparable hold- ing on an arms-length basis. 38 — Paragraphs 38 to 40, emphasis added.

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106. I do not therefore consider that the applicant was entitled to a special reference quantity under the provisions of Article 104. The transaction as a result of which 3a(l) of Regulation No 857/84, as amended John Ecroyd became owner cannot be by Regulation No 1639/91. regarded as an ordinary commercial transac­ tion, since the sum he paid for that farm was merely equivalent to 15% of its value, which represented the difference between the value of his rights under the Children's Settlement and the value of the property transferred. In that regard, an inheritance cannot be ruled 107. In the second part of the first question out, since it is true that, as the Court has the national court asks the Court whether pointed out in clear terms: '[...] the condi­ such a right to a special reference quantity tions of the contract embodying the transac­ could be inferred from the judgment in tion in question are such that they place the Wehrs. potential beneficiary in a privileged position compared with that of an operator taking over a comparable holding on an arms- length basis'.

108. Even though the invalidation of the 39 — It was accepted at the hearing that the trustees might, for anti-accumulation rule as a result of that example, have sold the trust property in order to divide the proceeds of sale. The trustees might not have granted John judgment might in some way affect the situ­ Ecroyd's request to acquire Lyvers Ocle. As his representa­ ation of the applicant in this case, it could tive accepted at the hearing, at that date he only had a 'putative right'. not, in my view, have imposed any obliga-

Questions 2 and 3 111. As is known, Article 3a(l), in the ver­ sion resulting from Regulation No 764/89, also laid down a period within which Slom I producers were allowed applications for pro­ visional special reference quantities. Those applications had to be made between 29 March 1989 and 29 June 1989. 109. By these questions, the High Court seeks to ascertain whether Article 3a(l) of Regulation No 857/84, as amended by Reg­ ulations Nos 764/89 and 1639/91, is valid to the extent that it does not permit the alloca­ tion of a special reference quantity to pro­ ducers who received a holding through an inheritance or similar means after 29 June 112. It is therefore entirely logical that 1989. I should point out that those questions Regulation No 1639/91 envisaged only the are relevant only if the national court were situation of Slom II producers who, before to reach the conclusion, applying the criteria 29 June 1989, had received a holding from an laid down in the judgment in Case originator who was a Slom I producer. In C-44/89 Von Deetzen II, that the applicant that context, they have the same potential received Lyvers Ocle through an inheritance right to a reference quantity as the originator or similar means. of the inheritance would have had. As is pointed out in the last sentence of the first recital in the preamble to Regulation No 1639/91 '[...] producers who acquired the milk holding through an inheritance or sim­ ilar means and made no application between 29 March and 29 June 1989, or whose appli­ 110. As Advocate General Mischo observed cations were rejected, should be allowed to in his Opinion in the Rauh case, in the con­ apply or to reapply'. On the other hand, if a text of an inheritance or similar transaction, right to a reference quantity had been it is necessary to consider the general princi­ granted to producers who had inherited after ple that the heir steps into the shoes of the 29 June 1989, they would have obtained a originator of the inheritance and takes over right which the originator of the inheritance

114. I therefore consider that Article 3a(l) of Regulation No 857/84, as amended by Reg­ ulations Nos 764/89 and 1639/91, has not 113. I would observe, furthermore, that the revealed any factor of such a kind as to affect new wording of Article 3a(l) which results its validity in so far as it excludes producers from Regulation No 1639/91 is in confor­ who acquired a holding through an inherit­ mity with the judgment in Rauh, to which, ance or similar means after 29 June 1989. in particular, the origin of that regulation is to be traced. The Court held that that article, in the version resulting from Regulation No 857/84, should not be interpreted as '[...] not permitting such an heir or successor to have Questions 4, 5 and 6 granted to himself, in the same way as the producer himself, a special reference quantity under the conditions laid down in Article 42 3a', and it went on to conclude that 'on the other hand [...] that article [must be] inter­ 115. In view of the answers which I have preted as meaning that for the purposes of proposed to the first three questions, it is not that provision "producers" includes not just necessary to answer the fourth, fifth and farmers who themselves entered into an sixth questions.

Conclusion

116. For the reasons set out above , I propose that the Court should reply as follows to the questions submitted for a preliminary ruling .

42 — Point 19. 43 — Point 23.

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R v MAFF, EX PARTE ECROYD

(1) In a situation such as that in point in the main proceedings, the competent national authority has neither a power nor a duty to award the applicant a provisional special reference quantity or to treat him as if he had been awarded a special reference quantity, either pursuant to Council Regulation (EEC) No 857/84 of 31 March 1984 adopting general rules for the application of the levy

I - 2763

OPINION OF MR LÉGER — CASE C-127/94

referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector, as amended by Council Regulation (EEC) No 764/89 and Council Regulation (EEC) No 1639/91, or following the judgment of the Court of Justice in Case C-264/90 Wehrs.

(2) Article 3a(l) of Regulation No 857/84, as amended by Regulations Nos 764/89 and 1639/91, has not revealed any factor of such a kind as to affect its validity in so far as it excludes producers who have acquired a holding through an inheritance or similar means after 29 June 1989.

(3) In view of the answers given, it is not necessary to answer the fourth, fifth and sixth questions.