C-49/94

JUDGMENT OF 14. 9. 1995 — CASE C-49/94

J U D G M E N T O F T H E C O U R T (Fifth Chamber) 14 September 1995 *

In Case C-49/94,

Ireland, represented by Michael A. Buckley, Chief State Solicitor, acting as Agent, with an address for service in Luxembourg at the Irish Embassy, 28 Rue d'Arlon,

applicant,

v

T H E C O U R T (Fifth Chamber),

composed of: C. Gulmann, President of the Chamber, P. Jann, J. C. Moitinho de Almeida, D. A. O . Edward and L. Sevón (Rapporteur), Judges,

Advocate General: D. Ruiz-Jarabo Colomer, Registrar: H. von Holstein, Deputy Registrar,

having regard to the Report for the Hearing,

after hearing oral argument from the parties at the hearing on 1 June 1995, at which Ireland was represented by Richard Law Nesbitt, Senior Counsel, and the Commission by James Macdonald Flett and Klaus-Dieter Borchardt, of its Legal Service, assisted by John Handoll, Solicitor,

after hearing the Opinion of the Advocate General at the sitting on 29 June 1995,

2 The reasons for the disallowance of that amount are to be found in the summary reports on the results of checks in respect of the clearance of E A G G F accounts, Guarantee Section, for 1989 (Commission document VI/303/91 of 27 July 1992) and 1990 (Commission document VI/119/93 of 1 October 1993). The Commission there refers to inspections which revealed that, in the case of some beef which had been stored before export and for which export refunds had been applied for and paid in advance, the maximum duration of storage authorized by the Community rules had been exceeded. The documents required by the Irish authorities did not enable them to check whether the exporter fulfilled the pre-financing conditions; in particular, no export declaration in proper form had been lodged within the pre- scribed period, in accordance with Article 30 of Commission Regulation (EEC) N o 3665/87 of 27 November 1987 laying down common detailed rules for the application of the system of export refunds on agricultural products (OJ 1987 L 351, p. 1). The form used ought to have been the Single Administrative Document (SAD) referred to in Council Regulation (EEC) N o 1900/85 of 8 July 1985 intro- ducing Community export and import declaration forms (OJ 1985 L 179, p. 4). Finally, the physical inspections were insufficient.

3 In this case the Commission complains that Ireland did not comply with the Com- munity rules on export refunds for beef and veal and, in particular, the provisions relating to the documents required from exporters in order for them to qualify for advance payment of export refunds.

6 Article 25 of that regulation provides that by a payment declaration, the exporter must express his intention to export the products after storage and to obtain a refund. At the time of acceptance of the payment declaration, the products are placed under customs control until they leave the customs territory of the Com- munity (Article 26). The period during which the products may remain under the customs warehousing procedure is to be six months from the date of acceptance of the payment declaration (Article 28(5)). That period was, however, extended t o nine months for the 1989 year by Commission Regulation N o 2675/88 of 29 August 1988 (OJ L 239, p. 20) and to seven months for the 1990 year by Com- mission Regulation N o 2965/89 of 29 September 1989 (OJ L 281, p. 103). By the last day of that period the exporter must lodge an export declaration (Article 30). Within 60 days from the date on which the products are no longer subject to the customs warehousing procedure, they must leave the customs territory of the Community (Article 32).

7 Regulation N o 3665/87 does not define what form the 'export declaration' referred to in Article 30 must take. However, account is to be taken of Article 3 of that regulation, which provides:

' 1 . The day of export means the date on which the customs authority accepts the export declaration in which it is stated that a refund will be applied for.

2. The date of acceptance of the export declaration shall determine:

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JUDGMENT OF 14. 9. 1995 — CASE C-49/94

(b) the net mass of the products or, where applicable, the unit of measurement to be taken into account in calculating the refund; and,

(c) in so far as is necessary for calculating the refund, particulars of the composi- tion of the products or the relevant reference.

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IRELAND v COMMISSION

If the document mentioned in this paragraph is the export declaration, this docu- ment must also include these references and the reference "refund code".

6. At the time of such acceptance, or of such equivalent act, the products shall be placed under customs control until they leave the customs territory of the Community.'

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JUDGMENT OF 14. 9. 1995 — CASE C-49/94

9 The applicant's first plea is that the requirements laid down in Article 30 of Regu- lation N o 3665/87 were complied with. In contending that the Single Administra- tive Document (SAD) referred to in Regulation N o 1900/85 must be used for the export declaration, the Commission is seeking to impose an unreasonable interpre- tation of Regulation N o 3665/87 which is not in any way supported by its word- ing. Article 30 of that regulation does n o t define what the export declaration must be and Article 3(3) and (5) of that regulation suggests that a series of acts may be taken as acceptance of an export declaration. Finally, Article 6(1 )(e) of Regulation N o 1900/85 provides that nothing in the regulation is to affect the use of special forms to facilitate declarations in particular cases.

io According to Ireland, when the customs authorities received form C&E 978, they had in their possession all the information necessary for checking that the condi- tions for application of the Community rules had been complied with, since they could refer to the previous document C&E 977. It was the combination of that documentation which constituted the export declaration.

1 1 The Commission considers, however, that the conditions laid down in Article 30 of Regulation N o 3665/87 were not complied with, on the ground that the stan- dard export document or a document having the same function and effect ought to have been used. The standard Community form is the Single Administrative Doc- ument (SAD) provided for by Regulation N o 1900/85 and used in nearly all the other Member States.

is According to the provisions of Regulation N o 3665/87, an exporter who wishes to obtain export refunds must lodge an export declaration and ensure that the prod- ucts leave the customs territory within a certain period.

ie By Regulation N o 1900/85, the Council introduced a Community export declara- tion form valid for all exports of goods from the customs territory of the Com- munity. Since, first, that regulation allows special forms to be used in certain cases and, secondly, Regulation N o 3665/87 contains no reference to that previous regu- lation but solely a description of the information that export declarations must contain, the question to be considered is whether the documents required by the

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JUDGMENT OF 14. 9. 1995 — CASE C-49/94

Irish authorities could constitute a proper export declaration for the purposes of Article 30 of Regulation N o 3665/87.

i7 Contrary to the applicant's submission, the documents used during the period in question could not constitute such an export declaration. N o n e of them includes a date of acceptance, that is to say the date on which the customs authority accepts the export declaration in which it is stated that a refund will be applied for. Although some forms submitted to the Court did mention a 'date ex warehouse', there is nothing to indicate that that date was marked on them or even certified by the customs authorities when the export declaration was lodged. Ireland's first plea in law must therefore be dismissed.

22 In view of the essential nature of the formalities which were not complied with and of the fact that it was not possible to check that the time-limit within which the products were to be exported was observed, and in view, therefore, of the probability of losses, or even fraud, to the detriment of the Community budget, the amount disallowed by the Commission, which was limited to 2% of the expenditure involved, cannot be regarded as excessive and disproportionate. This plea must therefore also be dismissed.

23 By its final plea in law Ireland contends that the Commission's interpretation of the regulation constitutes a breach of the principles of protection of legitimate expectations and of legal certainty.

24 It does not appear from an examination of the various Community regulations o r from their interpretation by the Commission that there has been a breach of those principles. The final plea must therefore be dismissed.

Costs

25 Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for. Since the Commission applied for costs against Ireland, and the latter has been unsuccessful, it must be ordered to pay the costs.

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Gulmann Jann Moitinho de Almeida

Edward Sevón

Delivered in open court in Luxembourg on 14 September 1995.

R. Grass C. Gulmann Registrar President of the Fifth Chamber

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