C-109/95

ASTIR ν GREEK STATE

OPINION OF ADVOCATE GENERAL ELMER delivered on 8 October 1996 *

Introduction judges)) in Athens has referred to the Court a question concerning the interpretation of the Regulation in relation to a specific case in which goods perished as a result of force majeure after leaving the geographical terri­ tory of the Community but before arriving 1. Under Commission Regulation (EEC) in the country of destination. N o 2730/79 of 29 November 1979 laying down common detailed rules for the applica­ tion of the system of export refunds on agri­ cultural products 1 (hereinafter 'the Regu­ lation'), export refunds are in general payable in respect of agricultural products where it is The relevant rules in the Regulation established that the product in question has left the geographical territory of the Com­ munity.

2. The ninth, sixteenth and seventeenth In the case of certain agricultural products, recitals in the preamble to the Regulation however, different refund rates apply for dif­ provide as follows: ferent countries, and such variable export refunds, as they are called, are payable only when proof is furnished that customs for­ malities have been completed in the country of destination.

Article 10

Articles 9, 10, 20, 21 and 22 of the Regu- lation contain the following provisions:

1. In the following circumstances payment of the refund shall be conditional not only on the product having left the geographical territory of the Community but also — save 'Article 9 where it has perished in transit as a result of force majeure — on its having been imported into a non-member country and where appropriate into a specific non-member country:

1. Without prejudice to the provisions of Articles 10, 20 and 26, the refund shall be paid only upon proof being furnished that the product in respect of which customs (a) where there is serious doubt as to the export formalities have been completed has, true destination of the product; or

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Article 22 claim the refund applicable in respect of the said other destination.

2. However, where as a result of force majeure a product exported under an export 3. The annex to Commission Regulation licence or advance fixing certificate specify- (EEC) N o 229/81 of 29 January 1981 fixing ing a compulsory destination is delivered to the export refunds on cereals and on wheat a destination other than that in respect of or rye flour, groats and meal 2 provides as which such licence or certificate was issued, follows: then where the exporter is able to furnish proof of force majeure together with proof, which shall be assessed having regard to the provisions of Article 20, of delivery to such other destination, he shall be entitled to '...

C C T heading N o Description Refund

Wheat flour:

ASTIR ν GREEK STATE

The proceedings before the national court 'the following question to the Court of Jus­ tice of the European Communities under Article 177 of the EEC Treaty: O n a proper construction of Article 10(4) of Commission Regulation (EEC) N o 2730/79, in conjunc­ tion with the provisions of Articles 20 and 21 thereof, is an exporter of an agricultural product, in this case wheat flour, entitled to a refund where the exported product, after 4. In April 1981 a Greek company sold leaving the geographical territory of the 1 900 tonnes of wheat flour to a company in Community, has perished in transit as a Vietnam. During transport by ship to Viet­ result of force majeure and where for that nam, the consignment was lost when the ship product the same amount of refund was sank 37 nautical miles west of Port Said in fixed for all non-member countries except Egypt. The vendor company had taken out the Soviet Union, for which, as regards the an insurance policy against loss of the export product mentioned above, no amount of refund as a result of shipwreck or any other refund was fixed?' maritime risk. After paying compensation to the vendor company under that insurance policy, the insurance company Astir AE (hereinafter 'Astir') brought proceedings before the Polimeles Protodikio against the Greek State for payment of DR 7 351 674 in Analysis respect of export refunds on the ground that it had been subrogated to the vendor compa­ ny's right to a corresponding amount of refund. The Greek State refused to pay on the ground that there was no entitlement to that amount. 6. The question whether an insurance com­ pany, when it pays the amount due under an insurance policy to an insured party, is sub­ rogated to the rights of that insured party does not appear to be governed by Commu­ nity law and is thus a matter which comes The question submitted for a preliminary under national law. ruling

If the case does not involve a variable refund, there is entitlement to a refund under the main rule in Article 9 of the Regulation, which requires only that the product has left 8. Astir submits that there can be a variable the geographical territory of the Commu- refund only in the case where different rates nity. have been fixed for several countries. Where no rate at all has been fixed, this cannot con- stitute a variation, but amounts, on the con- trary, to an exception to the right to a refund for certain destinations. An exception, it argues, does not have the same significance as a variation. In the present case, in which a If, however, the answer to the question is refund was fixed for all countries, and no that such a case does involve a variable refund was fixed for one country, one cannot refund, Article 20 in Title 3, Section 2 of the speak of a variation, but rather of an excep- Regulation dealing with refunds varying tion. This exception does not apply where according to destination will apply. Under the product has perished as a result of force Article 20, the refund is payable only if majeure. The refund valid for all countries proof is furnished that the customs formali- must therefore be paid. ties in the country of destination have been completed. Article 21(1) none the less pro- vides that advance payment of the lowest refund rate is possible. According to Article 21(2), however, Article 21(1) applies only where a refund has been fixed in respect of all non-member countries. The national 9. The Greek Government refers to a state- court therefore also requires to know in the ment by the Commission, according to present case whether Article 21(2) must be which the present case is covered by the sec- construed as meaning that the fact that no ond subparagraph of Article 8(2) of Council rate has been set (indicated by the symbol Regulation (EEC) N o 2746/75 of 29 October —) must be treated as equivalent to the set- 1975 laying down general rules for granting ting of a zero rate, such that the condition export refunds on cereals and criteria for fix- under Article 21(2) that a refund be fixed in ing the amount of such refunds. 3 That pro- respect of all non-member countries can be vision provides authorization for rules dero- regarded as having been satisfied. The national court also requires to know whether, for payment of the refund, signifi- 3 — OJ 1975 L 281, p. 78.

10. The Commission submits that the absence of a refund rate for the Soviet Union was attributable at the time to an embargo. The purpose behind not setting any refund rate was to ensure that no aid would be paid for exports to the Soviet Union. The failure to set any refund rate ought therefore, in the Commission's view, to be equated with a 12. Questioned on this point during the oral variation. In the case where a rate of E C U 72 procedure, the Commission stated that there has been set for the majority of non-member is none the less a difference between a dash countries, while no rate has been set for one and a zero rate. First, zero is a rate and can non-member country, there is a variation of therefore be fixed in advance. The issue of a the refund rate according to destination. certificate with a zero rate makes it possible Indeed, the same result could have been for the exporter to insure himself for that achieved by fixing a zero rate. rate for the entire period of validity of the certificate. This may be particularly useful in cases of tension on the world market which can result in the setting of export duties. Under Commission Regulation (EEC) N o 120/89 of 19 January 1989 laying down common detailed rules for the applica­ 11. During the oral procedure, the Commis­ tion of export levies and charges on agricul­ sion submitted that there is a non-variable tural products, 5 a refund fixed in advance is refund if the refund rate is the same for all not affected by a subsequent export duty lev­ countries. The Commission has always ied prior to completion of customs formali­ understood the non-fixing of a refund rate ties. Second, Council Regulation (EEC) for a specific country as meaning that an N o 565/80 of 4 March 1980 on the advance exporter who has exported to the country in question should not receive any refund. In other words, the lowest rate can also follow from a failure to fix any rate. This may, for 4 — OJ 1978 L 105, p. 5. 5 — OJ 1989 L 16, p. 19, as amended by Commission Regulation instance, be seen in another area in Commis­ (EEC) N o 1431/93 of 10 Tunc 1993 amending Regulation sion Regulation (EEC) N o 776/78 of (EEC) N o 120/89 laying down common detailed rules for the application of export levies and charges on agricultural 18 April 1978 on the application of the low­ products (OJ 1993 L 140, p. 27).

13. I wish to stress that Article 9(1) of the Regulation provides that a refund is payable only if proof is furnished that the product has left the territory of the Community. Article 20(1) provides that where the rate of The interpretation of Article 21(2) refund varies according to destination, pay- ment of the refund may be made only if the product has been imported into a non- member country for which the refund is pre- scribed. Under Article 20(2), proof must be provided that the customs formalities have been completed in the country of destina- tion. It follows from the ninth and sixteenth recitals in the preamble to the Regulation that the purpose of the provision in Article 20(1) is to prevent abuse. If the same refund 15. O n the assumption that there is a vari- rate does not apply for all non-member able refund, Article 20 of the Regulation, as countries, there is thus a risk that the prod- indicated, will be applicable. This provision uct may be sent on to a country to which a departs somewhat from Article 21(1), under lower rate applies. which part of the refund may be paid in advance on proof being furnished that the product has left the geographical territory of the Community. Article 21(1) may be traced back to the seventeenth recital in the pre- amble to the Regulation, which provides that, in order to put exports for which the 14. In my view, this danger of abuse exists refund varies according to destination on an not only where different rates, including equal footing with other exports, provision zero rates, have been set for various coun- should be made for a part of the refund tries, but also where no rate at all has been equal to the amount thereof as calculated on set for one or more countries. In both the basis of the lowest rate of refund appli- instances there is thus a need for the rule in cable to be paid as soon as the exporter has Article 20(1). For that reason I take the view furnished proof that the product has left the — along with the Commission, whose expla- geographical territory of the Community. nation of the formulation of zero rates and Article 21(1) does not require that the prod- uct must reach its destination. If this provi- sion is applicable, it will thus entitle Astir to 6 — OJ 1980 L 62, p. 5, as amended by Council Regulation the lowest refund. Under Article 21(2), how- (EEC) No 2026/83 of 18 July 1983 amending Regulation ever, Article 21(1) applies only if a refund for (EEC) No 565/80 on the advance payment of export refunds in respect of agricultural products (OJ 1983 L 199, p. 12). a given product has been fixed in respect of

14. As a corollary of allowing advance pay­ 17. I would point out that the Court, in ment of part of the refund, Article 20(2) pro­ Tara Meat Packers, addressed similar ques­ vides, as a precautionary measure designed to tions concerning Commission Regulation ensure that the goods reach their declared (EEC) N o 3665/87 of 27 November 1987 destination, that the payment may not laying down common detailed rules for the exceed the amount of refund calculated at application of the system of export refunds the lowest rate provided for, this being the on agricultural products. 8 Regulation minimum payment irrespective of the coun­ N o 3665/87 replaced that at issue in the try of actual final destination. present case and contained a codification of numerous amendments along with several adaptations. 9 The Article 20 referred to in the paragraphs of the judgment below corre­ sponds substantially to Article 21 of the Regulation. Paragraphs 13 to 16 of the judg­

15. It follows that such a system is not appli­ 7 — Judgment of 25 May 1993, [1993] ECR I-2811. cable in circumstances such as those in the 8 — Cited in footnote 1. main proceedings where refund rates were 9 — Sec the first recital in the preamble to Commission Regu­ lation (EEC) No 3665/87. not fixed for all destinations.

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16. This conclusion is inescapable, even if it not through completion of the export trans- is accepted, as [Tara Meat Packers] argues, action but rather with a view to compensat- that the fact that no rate was fixed is equiva- ing the exporter who cannot be blamed for lent to the fixing of a zero rate. In such a the failure to complete the transaction. The case, the rate applicable in any event to all Regulation does not in any case prescribe countries of export would be the zero rate that the exporter is completely barred from and traders would consequently not be receiving a refund, but rather merely con- entitled to any advance payment under tains provisions as to the amount of the Article 20.' refund.

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in accordance with Article 21. In my opin­ majeure must be treated in a manner dero­ ion, Article 10(4) does not contain any pro­ gating from the general rules of the Regu­ vision which, for the purposes of the present lation set out in Articles 9, 20 and 21. It is case, follows directly in advance from Article appropriate precisely in this connection to 21. It would appear that the sole purpose of refer to Article 10(4), under which, so far as Article 10(4) is to provide that Article 21 variable refunds are concerned, payment is also applies in the special cases of abuse made under the general rule in Article 21 in mentioned in Article 10(1). According to the cases where a product has perished as a documents on the file, the present case does result of force majeure. This is, moreover, not involve any of these special cases of what the Court held in Tara Meat Packers. abuse, and consequently neither Article 10(1) The Article 5(3) referred to in the paragraphs nor Article 10(4), which is linked to Article of the judgment cited below corresponds to 10(1), can apply. Article 10(4) of Regulation N o 2730/79. Paragraphs 17 and 18 of the judgment in Tara Meat Packers are worded as follows:

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and which are not material to the present the special case in which a product is deliv- case. ered to a destination other than that pro- vided for.

The Community legislature did not find it necessary to set out a force majeure proviso 26. The inescapable conclusion in those cir- in Articles 20 and 21. This also follows a cumstances is that force majeure does not contrario from Article 22, which contains an justify treatment that departs from the gen- express force majeure proviso in relation to eral rules in the Regulation.

Conclusion

27. For those reasons, I propose that the Court reply to the question as follows: