C-246/94

COOPERATIVA AGRICOLA ZOOTECNICA S. A N T O N I O A N D OTHERS

OPINION OF ADVOCATE GENERAL LÉGER delivered on 7 March 1996 *

* Original language: French. 1 — OJ 1979 L 179, p. 31. 2 — OJ 1977 L 77, p. 18. 5 — OJ, English Special Edition 1968 (I), p. 187. 3 — OJ 1977 L 157, p. 16. 6 — OJ 1977 L 61, p. 1. 4 — OJ 1987 L 109, p. 12. 7 — Article l(l)(a) and (b).

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defined reasons. 8 Lastly, Article 1(4) of or after [23 April 1987] and, at the request of Regulation N o 612/77 provides that such the party concerned, to securities lodged proof must be furnished within 180 days before [23 April 1987] which have not yet from the day on which the animal is put into been definitively released or forfeited'. free circulation, otherwise the security will be forfeit and retained as a levy.

Β — Incurring of customs debt

4. Regulation N o 1384/77 amends the rules for the application of the special arrange- ments in certain respects. Under Article 7(1) of that regulation, the importer is also required to inform the competent authorities 7. The moment when the customs debt is in the importing Member State, within one incurred, the moment when it is extinguished month following the date of importation, of and the moment at which payment of the the production unit or units where the amount of the customs debt may be young bovine animals are intended to be demanded by the competent authorities were fattened. harmonized by Directive 79/623.

under which they are placed, or non- 11. For various reasons, the agricultural compliance with a condition to which the holdings failed to fulfil the obligation, laid grant of the regime is subject, unless the down in the Community import arrange- competent authorities are satisfied that ments in respect of young male bovine ani- these failures have no significant effect on mals, to inform the competent Italian cus- the correct operation of the temporary toms authorities of the location of the storage procedure or customs regime in fattening unit within one month from the question.' date of importation. Cooperativa Agricola Zootecnica S. Antonio was several days late in informing the competent customs author- ities; Azienda Agricola Cavicchi did not inform them at all; while Cooperativa Lomellina di Cerealicoitori produced the information within the prescribed period but sent it to the local authorities in the district 9. That directive was replaced, after the where the fattening unit was located. More- events in the main proceedings occurred, by over, it appears from the order for reference Council Regulation (EEC) N o 2144/87 of in the last case 11 that that particular cooper- 13 July 1987 on customs debt, 10 which ative also failed to produce a declaration cer- incorporates and supplements the provisions tifying that the bovine animals intended for of the directive. fattening were still alive 120 days after the date on which they were imported.

16. The Amministrazione delle Finanze dello Stato contends that Article 1 of Regu- lation N o 612/77, as amended by Regulation N o 1384/77, and Article 2 of Directive 14. Separate appeals were then brought by 79/623 have been infringed and misapplied. the three holdings before the Corte It also considers that Article 2(d) of Direc- d'Appello (Court of Appeal), Trieste, which tive 79/623 (not transposed into Italian law) by judgment of 23 February 1990 confirmed is not directly applicable. Even if it were, the the Tribunale's ruling in the case of Cooper- Amministrazione delle Finanze contends ativa Agricola Zootecnica S. Antonio. It con- that the correct operation of the customs sidered that Directive 79/623 was subordi- regime established by the Community for nate to and predated a higher rule of law, the importation of young male bovine ani- namely Regulation N o 1121/87, and was mals intended for fattening requires fulfil- consequently not applicable. However, in the ment of the obligation that the Corte case of the appeals brought by Cooperativa d'Appello itself considered had not been Lomellina di Cerealicoitori and Azienda complied with, namely the obligation to Agricola Cavicchi, it considered in its judg- inform the competent authority of the loca- ments of 6 June 1992 and 19 January tion of the fattening unit within the pre- 1993 that failure to comply with the obliga- scribed period, this being essential for the tions laid down in Regulation N o 612/77, as purposes of the requisite inspection. amended by Regulation N o 1384/77, had had no significant effect on the correct oper- ation of the customs regime governing the importation of bovine animals. It accord- ingly held that Article 2(d) of Directive 79/623 was directly applicable in Italy, despite the fact that it had not been trans- posed into Italian law, and it therefore 17. Cooperativa Agricola Zootecnica S. reversed the judgments handed down by the Antonio, for its part, claims that Articles court of first instance in those two cases. 173, 189 and 177 of the EC Treaty have been infringed. It claims that the Corte d'Appello misapplied Regulation N o 1121/87, since the delay in communicating the location of the fattening unit had no effect on the correct operation of the customs regime in question, 15. Cooperativa Agricola Zootecnica S. that under the terms of Article 2(d) of Direc- Antonio and the Amministrazione delle tive 79/623 no customs debt was therefore Finanze dello Stato applied to the Corte incurred, and that Regulation N o 1121/87 is Suprema di Cassazione for a review of the invalid.

The second question of interpretation arises only if the first question is answered in the affirmative. It seeks to establish whether the 19. In Cases C-247/94, C-248/94 and provision in question also applies where C-249/94, the national court submitted two there has been a delay in communicating the questions for a preliminary ruling on inter- location of the production unit where the pretation. These are essentially identical to bovine animals are intended to be fattened, the first two questions set out above but the that is to say, where Regulation N o 612/77, wording of the second question differs as amended by Article 7 of Regulation N o slightly in Cases C-248/94 and C-249/94, 1384/77, has been infringed. It is necessary, seeking to ascertain whether '[...] the provi- therefore, to interpret the provisions of that sion in question also applies where Regu- regulation establishing special import lation N o 612/77 [...] has been infringed, as arrangements in order to ascertain whether found by the Corte d'Appello, Trieste [...]'.

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21. A number of Italian agricultural cooper- atives had already applied to the Court, under the second paragraph of Article 23. The directive has not been transposed 173 and the second paragraph of Article into Italian law, 15 despite the fact that the . 189 of the Treaty, for a declaration that Arti- period allowed for transposition under Arti- cle 1(2) of Regulation N o 1121/87 was cle 12 expired on 1 January 1982. The direc- invalid. 12 The Court noted that the provi- tive was therefore in force at the time of the sion in question applies '[...] to objectively events reported in the four orders for refer- determined situations and entails legal effects ence. for categories of persons regarded generally and in the abstract [...]' and concluded that

13 — Ibid., paragraph 10. 14 — Ibid., operative part of the order. 12 — Sec Order in Case 191/87 Covale and Others ν Commission 15 — Sec page 3 of the French version of the order for reference [1988] ECR 515. in Case C-248/94.

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[...]

(d) the non-fulfilment of one of the obliga­ 25. Thus, the Court has held that the essen­ tions arising, in respect of goods liable to tial prerequisite for a provision of a directive import duties, from their temporary stor­ to have direct effect is that it should be age or from the use of the customs regime unconditional and sufficiently precise. 19 under which they are placed, or non­ compliance with a condition to which the grant of the regime is subject, unless the competent authorities are satisfied that 16 — Case 38/77 Enka ν Inspecteur der Invoerrechten en Accijn­ zen [1977] ECR 2203. these failures have no significant effect on 17 — Paragraph 9. the correct operation of the temporary 18 — Ibid., paragraph 10. storage procedure or customs regime in 19 — See the judgment in Case 8/81 Becker ν Finanzamt Münster-Innenstadt [1982] ECR 53, paragraph 25. question'.

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29. According to the Commission, that pro- satisfied' in Article 2(d) of Directive vision meets the Court's criteria for direct 79/623 is to be interpreted as meaning that effect. the competent authorities have a wide meas- ure of discretion as regards the conditions for implementing the system so established 22 and that the provision in question is there- fore not sufficiently precise and uncondi- tional to be directly applicable.

30. I believe the Commission's argument should be endorsed.

22 — Sec pages 5 and 6 of the French version of the Italian Gov- 20 — Third recital in the preamble. ernment's observations. 21 — Fifth recital in the preamble. 23 — Seventh recital in the preamble.

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legislature. The expression 'unless the com­ that the non-fulfilment of the obligations petent authorities are satisfied' must there­ which arise from: fore be interpreted as meaning that a trader may furnish the competent national authori­ ties with proof that non-fulfilment of a cus­ toms formality or obligation has had no sig­ nificant effect on the correct operation of the — the provisions adopted in application temporary storage procedure or customs of Article 2 of Directive 68/312/EEC, regime in question and the Member State or may not object that national measures that would in fact facilitate the application of a concession have not been adopted.

— keeping the goods in question in tem­ porary storage, or

35. This interpretation is confirmed by the Court's judgment in Esercizio Magazzini — the use of the customs regime under Generali, 2 4 in which it had been asked for a which the said goods have been ruling on the direct application of Article placed, 4 of Directive 79/623, which provides that:

The second question

37. The Court held, on the basis of Article 4 of Directive 79/623 which had not been transposed into Italian law, together with the 39. The second question submitted by the ninth recital in the preamble to the directive, national court is an extension of the first, and that the reasons for the extinction of the cus- seeks essentially to ascertain whether Article toms debt had to be based on the fact that 2(d) of Directive 79/623 also applies in the the goods had not been used for the econ- highly specific cases on which it has been omic purpose which justified the application asked to rule, namely where a trader has of import duties. In the case of theft, how- failed to complete the formality laid down in ever, the Court assumed that the goods Article l(l)(d) of Regulation N o 612/77, as passed into the Community commercial cir- amended by Article 7(1) of Regulation N o cuit. It concluded that the loss of the goods 1384/77. In other words, can an importer of for the purposes of the directive did not young male bovine animals for fattening, embrace the concept of theft, regardless of who has failed to fulfil his obligation to the circumstances in which it had been com- inform the competent national authorities of mitted. In so ruling, the Court gave direct the location of the fattening unit within the effect to Article 4 of Directive 79/623, and prescribed period, rely on the provisions of did not consider that the expression 'to the Directive 79/623 and effectively claim that satisfaction of the competent authorities' the customs debt has not been incurred, by meant that the provision was not sufficiently furnishing proof that his failure to fulfil the precise and unconditional. 25 It should not obligation has had no effect on the operation take a different view with regard to the inter- of the customs regime in question, or must it pretation of Article 2(d) of Directive 79/623. be held that his failure to observe the time- limit had a significant effect on the correct operation of the special import arrangements 25 — Ibid., paragraphs 11 to 14. in respect of certain young male bovine

animals for fattening? This is the first occa- 42. Cooperativa Agricola Zootecnica S. sion on which the Court has been asked to Antonio, for its part, claims that the rule on a question of this kind. infringement alleged against it had no effect on the operation of the customs regime in question and that furthermore the require- ments contained in Article 1(1 )(d) of Regu- lation N o 612/77, as amended by Article 7(1) of Regulation N o 1384/77 and by Article 1(2) of Regulation N o 1121/87, are unlaw- 40. The Italian Government claims that fail- ful. 26 ure to observe the time-limit at issue in the main proceedings has a significant effect on the operation of the special customs regime and that a customs debt on importation is automatically incurred. The specific rules on the release of the security for special import arrangements in the beef and veal sector are therefore applicable. It points out that the objective pursued by the Community legisla- ture would have no practical effect if there 43. I consider that, far from being inconsis- was no penalty for failing to fulfil the addi- tent, Article 2(d) of Directive 79/623 and tional obligation imposed by Regulation N o Article 1(1)(d) of Regulation N o 612/77, as 1384/77. amended by Article 7(1) of Regulation N o 1384/77, are complementary. Those two Community acts do not pursue the same aims. Directive 79/623 harmonizes the gen- eral rules on customs debt, 27 while Regu- lation N o 612/77 sets out the particular pro- visions applicable to the special import 41. The Commission is less positive. It takes arrangements in respect of certain young the view that a detailed assessment of the male bovine animals for fattening. Article question whether failure to observe this for- 2(d) of Directive 79/623 lays down a general mality had no significant effect on the cor- principle, namely, that in cases where failure rect operation of the customs regime in to fulfil an obligation has no significant effect question should be made in each of the cases on the correct operation of the customs brought before the national court. Thus, regime in question, no customs debt is according to the Commission, the traders in incurred. The trader may furnish proof to question have a right under Article 2(d) of that effect, unless the Community legislature Directive 79/623 to expect that the compe- decides otherwise. The answer to the second tent national authority, far from considering question depends essentially on the Commu- that a customs debt is incurred automatically nity legislature's aim in imposing the partic- as a result of their failure to observe the for- ular obligation contained in Article 1(1)(d) of mality in question, will ascertain case by case Regulation N o 612/77, as amended. whether or not it had a significant effect on the correct operation of the special customs regime and will take into account the se- riousness of the infringement committed by 26 — Observations of the plaintiff in the main proceedings, p. 2 of the French version. the trader in question. 27 — See point 31 above.

(d) a written undertaking, given at the time (a) has been fattened in the production unit of importation, to inform the competent or units indicated pursuant to paragraph authority in the importing Member State within one month following the date of 1(d); importation, of the production unit or units where the young bovine animals are intended to be fattened.' 28

(b)has not been slaughtered before the 28 — Article 1(1)(d) of Regulation No 612/77, as amended by expiry of the period specified in Article Article 7(1) of Regulation No 1384/77. 1(a); or

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(c) has been slaughtered before the expiry of 50. Article 1(2) and (3) of Regulation N o this period for health reasons or has died 1121/87 provides that: as a result of sickness or accident.

The security shall be released immediately after such proof has been furnished. '2. The following subparagraph is added to Article 1(3) [of Regulation N o 612/77]:

OPINION OF MR LÉGER — JOINED CASES C-246/94, C-247/94, C-248/94 AND C-249/94

3. The following subparagraph is added to the Community and to increase the produc- Article 1(4) [of Regulation N o 612/77]: tion of meat without increasing the number of cows and, consequently, milk production, it is advisable under certain market condi- tions to apply a special system to imports from third countries of certain categories of young bovine animals and calves for fatten- ing in the Community'. "However, if such proof has been established within the abovementioned 180 days but is produced within the 18 months following these 180 days, the amount forfeited, less 15% of the security amount, shall be repaid."' 54. The special arrangements were adopted on 24 March 1977 by Regulation N o 612/77. 30However, in order to avoid abuses and ensure that the measures were not diverted from their objective, 31 the Commu- 51. An analysis of this new provision shows nity legislature established a system binding that the legislature attaches far more impor- on the importer. H e must produce a written tance to fulfilment of the obligation laid declaration that the young bovine animals down in Article 1(1 )(d) of Regulation N o are intended for fattening for a period of 612/77 than to fulfilment of the obligation 120 days from the day on which they were laid down in Article 1(4) of that regulation. put into free circulation 32 and a security in the sum of the amount suspended of the levy applicable on the day of importation, 33 the security being released only if proof is fur- nished that the animal has not been slaugh- tered before the expiry of the period speci- fied. 34 52. An analysis of the rationale underlying that special arrangement also shows that ful- filment of the obligation laid down in Article 1(d) of Regulation N o 612/77 is regarded by the Community legislature as essential to the correct operation of the customs regime in question. 55. As soon as the special arrangements were in place, the Community legislature realized that exceptional vigilance would be needed, in view of the risks of fraud and abuses liable to divert those arrangements from their true

59. Lastly, an analysis of the rationale behind Directive 79/623 36 and of the word- ing of Article 2(d) thereof is consistent with the strict interpretation which I propose that the Court should adopt. In so far as the 57. In the light of the wording and rationale Community legislature has indicated, by of the special provisions, I am inclined to means of special rules, that fulfilment of the take the view that fulfilment of this addi- obligation specifically laid down in Article tional obligation, and observance of the 1(1 )(d) of Regulation N o 612/77 is essential time-limit set for complying with it, are to to the correct operation of the customs be regarded as a necessary condition for the regime in question, Article 2(d) in fine of effective application of the supervisory meas- Directive 79/623 is not applicable. Any other ures required by the Community legislature interpretation would deprive the special and are consequently essential to the correct arrangements introduced by Regulation N o operation of that regime. 612/77, as amended, of their effectiveness.

35 — Second and third recitals in the preamble. 36 — See point 31 above.

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60. I therefore propose that the Court's customs regime in question, within the answer to the second question should be that meaning of Article 2(d) of Directive 79/623. failure, by an importer of young male bovine animals intended for fattening, to observe the formality provided for in Article 1(1 )(d) of Regulation N o 612/77, as amended by Arti- 61. The third question is consequently cle 7(1) of Regulation N o 1384/77, has a sig- devoid of purpose and does not require an nificant effect on the correct operation of the answer.