C-164/96

R E G I O N E P I E M O N T E v SAIAGRICOLA

OPINION OF ADVOCATE GENERAL LÉGER delivered o n 29 M a y 1997 *

1. The Italian Consiglio di Stato (Council of August 1982 4 provides that only natural per- State) seeks an interpretation of Council sons may be registered. 5 Directive 72/159/EEC of 17 April 1972 on the modernization of farms 1 and of Council Regulation (EEC) N o 797/85 of 12 March 1985 on improving the efficiency of agricul- tural structures. 2 3. That decision was annulled by the Tribu- nale Amministrativo Regionale per il Piemonte (Piedmont Regional Administra- tive Court) by decisions of 6 May and 3 June 1993 on the ground that Law N o 18/82 was contrary to the provisions of Directive The Court is essentially requested to rule 3 72/159/EEC (hereinafter 'Directive 72/159' once again on whether those measures per- or 'the directive') which makes it unlawful mit Member States to apply different treat- for Member States to grant the status of ment to 'farmer[s] practising farming as 'farmer practising farming as his main occu- [their] main occupation' by reason of the pation' only to natural persons. legal form they have assumed.

4. The Piedmont Region appealed to the Facts and procedure Consiglio di Stato, which stayed proceedings and referred the following question to the Court for a preliminary ruling under Article 177 of the EC Treaty:

2. By a decision dated 3 June 1991, the Ver- celli Provincial Commission responsible for the register of farmers practising farming as their main occupation rejected an application '... whether, under Council Directive for registration made by Saiagricola SpA 72/159/EEC of 17 April 1972 and the subse- (hereinafter 'Saiagricola') on the ground that quent Council Regulation (EEC) N o 797/85 Piedmont Regional Law N o 18 of 23

Relevant provisions 7. Article 3 requires Member States to define what is meant by the expression 'farmer practising farming as his main occupation', bearing in mind certain minimum criteria in the case of natural persons. These criteria Relevant Community legisktion must ensure that the farmer derives at least 50% of his income from farming and that he devotes more than half of his total working time to farming, although Member States have discretion to impose stricter require- ments in both respects. In defining the 5. Directive 72/159 aims to '[bring] about expression in relation to legal persons, Mem- structural conditions conducive to a signifi- ber States must have regard in particular to cant improvement in agricultural incomes those two criteria. 8 and working and production conditions' 7 and, to this end, provides for a system of incentives to 'farms suitable for develop- ment'.

8. ReguUtion No 797/85 (hereinafter 'the regulation') sets out the basic Community rules relating to agricultural structures. The 6. Article 2 of the directive defines 'farms regulation, which aims to improve the suitable for development' as those where efficiency of agricultural structures within the farmer practises farming as his main the Community, establishes common mea- occupation, possesses adequate occupational sures and provides for the involvement of skill and competence, undertakes to keep the European Agricultural Guidance and Guarantee Fund in measures concerning

6 — Page 5 of the English translation of the order for reference. 7 — Article 1(1). 8 — Paragraph 1.

'Member States shall, for the purposes of this regulation, define what is meant by the 12. Under Italian law, the expression 'farmer expression "farmer practising farming as his practising farming as his main occupation' main occupation". was first defined by the Law of 9 May 1975. 13 Articles 12 and 13 of Law N o 153 provide that only natural persons, agricul- tural cooperatives established in accordance with the provisions relating to cooperation and associations of farmers may benefit from This definition shall, in the case of a natural the measures provided for by Directive person, include at least the condition that the 72/159. Only after Regulation N o 797/85 proportion of income derived from the agri- cultural holding must be 50% or more of the farmer's total income and that the working time devoted to work unconnected with the 10 — Council Regulation of 15 July 1991 on improving the effi- holding must be less than half of the farmer's ciency of agricultural structures (OJ 1991 L 218, p. 1) (first recital). total working time. 11 — After the events material to this case. 12 — Article 40(1) of Regulation N o 2328/91. 13 — Law N o 153 concerning the transposition of the directives of the Council of the European Communities on the reform of agriculture (GURI N o 137 of 26 May 1975, 9 — Article 1. p. 3298, hereinafter 'Law N o 153' or 'the 1975 Law'.

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O P I N I O N OF MR LÉGER — CASE C-164/96

entered into force was the Law of 1975 Farmers practising farming as their main supplemented — and, in part, amended — occupation who are covered by Laws N o by a decree of the Minister of Agriculture 153 of 9 May 1975, N o 352 of 10 May 1976 and Forests dated 12 September 1985. , 4 That and Regional Implementing Law N o 15 of decision includes companies among the 22 February 1977, as subsequendy amended potential beneficiaries of the measures pro- and supplemented, may register ..." vided for by Regulation N o 797/85. 1 5

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REGIONE PIEMONTE v SAIAGRICOLA

occupation', which confers entitlement to the 20. In the VüL· Banfi case, 20 the Court held agricultural aids provided for by Directive that: 72/159. , s In contrast, farmers who are not registered must lodge a specific application and may only be considered to be 'farmers practising farming as their main occupation' once a case by case investigation has been carried out in order to Obtain the same basic '... Directive [72/159] not only does not facts and details as those required by the exclude legal persons but expressly includes rules concerning registration ...'. " them within its scope provided that they ful- fil the conditions of Article 2 and meet the definition of "a farmer practising farming as his main occupation" laid down in imple- mentation of Article 3(1). Since those condi- tions are unrelated to the form in which a legal person is constituted, the inference t o be drawn is that Member States are not per- mitted to withhold from legal persons the 18. The proceedings between Saiagricola and benefit of provisions of the directive solely the Provincial Commission are based on this because they have assumed a specific legal difference in the treatment accorded to the form. Differential treatment such as that two categories of farmers concerned. would, in any event, conflict with the prin- ciple of non-discrimination enshrined in Article 40(3) of the EEC Treaty which Mem- ber States must observe when giving effect to the common agricultural policy.'

The questions submitted by the national court

As the Court has held (paragraph 10 of the judgment in VilL· Banfi, cited above), such differential treatment would in any event conflict with the principle of non- discrimination enshrined in Article 40(3) of the E E C Treaty which Member States must observe when giving effect to the common 24. Admittedly, the Piedmont regional legis- agricultural policy.' 21 lation does not expressly exclude legal per- sons from the scope of Directive 72/159 and Regulation N o 797/85, but it does prevent certain legal persons from obtaining registra- tion.

26. Both the purpose and the wording 23 of for registration solely by reason of the legal the Community legislation 24 make it clear form assumed by the applicant is incompat- that the status of 'farmer practising farming ible with Community law. as his main occupation' is not dependent on the legal form assumed by the farmer. O n the other hand, the Community legislature does attach particular importance to the spe- cific criteria it has laid down. Thus, Article 2(5) of Regulation N o 797/85 and Article Breach of the principle of equal treatment 3(1) of Directive 72/159 provide — let us remember — that the expression 'farmer practising farming as his main occupation', as defined by the Member States for the pur- poses of those measures, is to include 'at least the condition that the proportion of income derived from the agricultural holding must be 50% or more of the farmer's total income and that the working time devoted to 28. The fact that certain legal persons may work unconnected with the holding must be not be registered places them in a less less than half of the farmer's total working favourable situation than that enjoyed by time'. By specifying, in those articles, that natural persons who are eligible for registra- Member States are to take account of those tion. As we have seen, 25 production of a cer- criteria in defining the expression 'farmer tificate of registration is sufficient proof of practising farming as his main occupation' in the status of farmer practising farming as his the case of legal persons, the Community main occupation which is required in order legislature made it clear that such persons fall to qualify for aid jointly financed by the within the scope of the system of agricultural Community, while persons not so registered aids so established, provided they fulfil the must undergo a more lengthy and complex necessary conditions. This was the approach procedure in order to be accorded this status. followed in the Viüa Banfi and Tenuta il However, no justification has been given in Bosco cases, where the Court held that Mem- support of this unequal treatment. 26 ber States have no discretion to deny certain categories of legal persons the advantages provided for by Directive 72/159 — and, subsequently, by Regulation N o 797/85 — solely by reason of their legal form.

31. In the light of the foregoing, I propose that the question referred by the Coun- cil of State should be answered as follows:

Council Directive 72/159/EEC of 17 April 1972 concerning the modernization of farms and Council Regulation (EEC) N o 797/85 of 12 March 1985 on improving the efficiency of agricultural structures must be interpreted as meaning that a Member State is not authorized to provide for different treatment of farmers prac- tising farming as their main occupation by reason of the legal form they have assumed, even if only in relation to the introduction of a special system of identi- fication based on a specific register set up solely for natural persons.

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