C-273/95

BURATTI v TAV

J U D G M E N T O F T H E C O U R T (Third Chamber) 16 January 1997 *

In Case C-273/95,

REFERENCE to the Court under Article 177 of the EC Treaty by the Pretura Circondariale, Verona, Sezione Distaccata di Isola della Scala (Italy), for a prelimi- nary ruling in the proceedings pending before that court between

Impresa Agricola Buratti Leonardo, Pierluigi e Livio,

and

JUDGMENT OF 16. 1. 1997 — CASE C-273/95

Advocate General: M. B. Elmer, Registrar: H . A. Rühi, Principal Administrator,

after considering the written observations submitted on behalf of:

— Impresa Agricola Buratti Leonardo, Pierluigi e Livio, by E. Cappelli and P. De Caterini, of the Rome Bar, and by C. Fratta Pasini, of the Verona Bar,

— the Commission of the European Communities, by E. de March, Legal Adviser, and G. Berscheid, of its Legal Service, acting as Agents,

having regard to the Report for the Hearing,

BURATTI v TAV

preliminary ruling under Article 177 of the EC Treaty a question on the interpre- tation of Articles 10 and 11 of Commission Regulation (EEC) N o 3478/92 of 1 December 1992 laying down detailed rules for the application of the premium system for raw tobacco (OJ 1992 L 351, p. 17), as amended by Commission Regu- lation (EC) N o 3477/93 of 17 December 1993 concerning the agricultural conver- sion rates to be applied in the tobacco sector (OJ 1993 L 317, p. 30).

2 That question was raised in proceedings between an individual tobacco producer, Impresa Agricola Buratti Leonardo, Pierluigi e Livio ('Buratti') and the group of producers to which it belongs, Tabacchicoltori Associati Veneti Soc. coop, ari ('TAV'), concerning the date to be taken into consideration in order to determine the agricultural conversion rate applicable to the amount of the processing pre- mium.

3 Council Regulation (EEC) N o 2075/92 of 30 June 1992 on the common organiza- tion of the market in raw tobacco (OJ 1992 L 215, p. 70) made substantial alter- ations to the Community rules governing the raw tobacco market. In order to sta- bilize that market and ensure a fair standard of living for the agricultural population concerned, Regulation N o 2075/92 introduced inter alia a premium system (Title I) and a system of production limitation (Title II) from 1993 until 1997.

4 The sixth recital in the preamble to Regulation N o 2075/92 states that the pre- mium system can be managed efficiently by means of cultivation contracts between growers and processors which guarantee stable outlets to the growers and regular supplies to the processor. Payment of the premium by the processor to the pro- ducer at the time of delivery of the tobacco covered by the contract, subject to compliance with the quality requirements, provides support for the growers while facilitating management of the premium system.

— an undertaking by the grower to deliver to the premises of the first processor raw tobacco corresponding to the quality requirements.

(2) The competent body shall reimburse the amount of the premium to the first processor against presentation of proof that the grower has delivered the tobacco and that the amount referred to in the first paragraph has been paid.'

7 In addition, Article 12(1) of Regulation N o 2075/92 provides that:

'In order to concentrate supply and adapt it to the qualitative requirements of the market, specific aid equivalent to 10% of the premium shall be granted where cul- tivation contracts are concluded between a first processor and a recognized group of producers and where the deliveries covered by such contracts account for the entire output of the members of the group.'

I-228

BURATTIv TAV

I-229

JUDGMENT OF 16. 1. 1997 — CASE C-273/95

11 Lastly, Article 11 of Regulation N o 3478/92 originally provided that:

'The agricultural conversion rate to be used for converting premiums and advances on premiums into national currency shall be the rate applicable on 1 August of the year of harvest for deliveries up to 31 December of that year and that applicable on 1 January of the following year for deliveries thereafter. Processors shall pay pre- miums to producers in the currency of the Member State in which the tobacco was harvested'.

12 The first sentence of Article 11 was repealed by Article 6 of Regulation N o 3477/93, which, following the introduction of the new common organization of the market, brought together for reasons of clarity the specific provisions appli- cable to conversion rates in the tobacco sector. Article 1 of Regulation N o 3477/93 provides, in terms virtually identical to the former Article 11 of Regulation N o 3478/92, that:

'The agricultural conversion rate to be applied for conversion into national cur- rency of the amount of the premium and the advance on the premium payment referred to in Article 3 of Regulation (EEC) N o 2075/92 shall be the rate valid on 1 August of the year of harvest, as regards deliveries up to 31 December of that year, and the rate valid on 1 January of the following year, as regards later deliver- ies.'

15 It should be noted that the order for reference contains no particulars of the fac­ tual circumstances surrounding the delivery of the tobacco. However, it does emerge from the written observations submitted to the Court that between August 1993 and January 1994 the members of TAV placed the tobacco in a warehouse lent by CTV to TAV without charge, under the supervision of the Italian interven­ tion body responsible for paying the premium, l'Azienda di Stato per gli Interventi nel Mercato Agricolo (ΑΙΜΑ). Delivery notes were made out at the time expressly stating that: 'the undersigned processor (CTV) hereby declares that this note does not constitute assumption of responsibility for the tobacco'. Furthermore, the agreement between TAV and CTV in respect of the classification of the tobacco was not signed until 28 January 1994. Finally, according CTV's VAT statements, property in the tobacco was legally transferred to CTV on 7 and 31 January 1994.

16 Following delivery of the tobacco, CTV paid TAV the amount of the premium, using the conversion rate applicable on 1 August 1993 to convert the sum into national currency. According to CTV, when deliveries were made in performance of a cultivation contract concluded with a group of producers it was necessary when determining the applicable conversion rate to have regard, not to the con­ tractual date of delivery, which it said was January 1994, but rather to the dates on which the members supplied their 'contributions' to the group during the second half of 1993. CTV stated that in so acting it had followed the corresponding instructions given by ΑΙΜΑ, themselves issuing from instructions given by the Commission.

21 In the main proceedings, TAV reaffirmed its view that the date to be taken into consideration for the purposes of determining the conversion rate was the date on which the tobacco was delivered by the producers to their group.

22 Accordingly, the Magistrate decided to stay proceedings and to refer the following question to the Court for a preliminary ruling:

'Is Regulation (EEC) N o 3478/92, and in particular Articles 10 and 11, to be inter- preted as meaning that the date to be taken into consideration for the purposes of applying the agricultural conversion rate to the processing premium is the date on

I-232

BURATTI v TAV

which tobacco is delivered to the processor by the producer group or the date on which the product is supplied by the individual producer to the group itself, and what constitutes "delivery under contract" within the meaning of the abovemen- tioned provisions?'

27 As regards the substance of that concept, it should be noted that the provisions of Regulations N o 2075/92 and N o 3478/92 in which the terms 'delivery under con- tract' and 'delivery' appear concern the relationship between the processor and the producer or group of producers and have nothing to do with the relations between individual producers and the group to which they belong.

28 Thus, as far as Regulation N o 2075/92 is concerned, Article 5(c) makes the grant of the premium subject inter alia to the condition that the leaf tobacco must be 'delivered' by the producer to the premises of the first processor under a cultiva- tion contract, whilst Article 6 refers to the grower's undertaking to 'deliver' tobacco to the processor as an element of that contract. In addition, Article 12(1) encourages the setting up of producers' groups by granting specific aid of 10% of the premium where cultivation contracts are concluded between a first processor and a recognized group of producers and where the 'deliveries' covered by such contracts account for the entire output of the members of the group.

29 Similarly, as regards Regulation N o 3478/92, Article 2(1) and (2) describes cultiva- tion contracts as concluded between a processor and 'a producer or group of pro- ducers' and as committing the processor to take 'delivery' of the quantity of leaf tobacco provided for in the contract and the producer or group of producers to 'deliver' that quantity to the processor, to the extent that their actual production so allows.

I-234

BURATTI v TAV

30 Furthermore, Article 10 of Regulation N o 3478/92 sets a period of one month from the end of each 'delivery under contract' for the payment to the producer by the processor of an amount equal to the premium. Article 1 of Regulation N o 3477/93 states that that sum is to be converted into national currency by applying the agricultural conversion rate valid on 1 August of the year of harvest, as regards 'deliveries' up to 31 December of that year, and the rate valid on 1 January of the following year, as regards later 'deliveries'.

which the premium must be paid by the processor does not start to run until goods which comply with the terms of the cultivation contract have been deliv- ered.

35 In the circumstances, it is for the national court to determine when the delivery of the tobacco, as thus defined, took place, taking into account all the factual circum- stances surrounding the supply of the tobacco. In this regard, it must consider, in particular, whether the tobacco was merely stored in a warehouse lent by the pro- cessor or whether it was actually delivered for processing, which might be the case, especially insofar as delivery took place under the supervision of the competent national authorities in connection with the common organization of the market.

36 Therefore, the answer to be given to the national court must be that the terms 'delivery under contract' and 'delivery' used in Article 10 of Regulation N o 3478/92 and Article 1 of Regulation N o 3477/93 respectively are to be interpreted, where the processor has concluded a cultivation contract with a group of produc- ers, as referring to the delivery, by a producer or group of producers to the proces- sor, of a quantity of tobacco to be processed in performance of the cultivation con- tract.

Costs

37 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

Moitinho de Almeida Gulmann Puissochet

Delivered in open court in Luxembourg on 16 January 1997.

R. Grass J. C. Moitinho de Almeida

Registrar President of the Third Chamber

I-237