C-324/96

PETRIDI v SIMOU AND OTHERS

OPINION OF ADVOCATE GENERAL ELMER delivered on 2 October 1997

1. The Irinodikio (Small Claims Court), guaranteed quantity, in particular in the light Echinos, Greece, has in this case referred to of market requirements and the socio- the Court for a preliminary ruling a number economic and agricultural conditions of the of questions on the validity of various regu- regions concerned, for each variety or group lations dealing with the common organisa- of varieties of Community-produced tion of the market in tobacco. tobacco for which prices and premiums are fixed. The overall maximum quantity for the Community shall be fixed at 385 000 tonnes of leaf tobacco for each of the 1988, 1989 and 1990 harvests. The relevant rules of Community law

Without prejudice to ..., for each 1% by 2. Under Regulation (EEC) N o 727/70 of which the maximum guaranteed quantity is the Council of 21 April 1970 on the common exceeded per variety or group of varieties, organisation of the market in raw tobacco the intervention prices and the premiums ('the basic regulation'), 1 premiums were concerned shall suffer a reduction of 1%. ... granted to those persons who purchased tobacco direct from Community producers.

The reductions referred to in the second sub- paragraph shall not exceed 5% for the 1988 3. Council Regulation (EEC) N o 1114/88 of harvest and 15% for the 1989 and 1990 har- 25 April 1988 amending the basic regulation vests. ('the amending regulation') 2 added a para- graph (5) to Article 4 of the basic regulation:

For the purposes of applying this paragraph, the Commission shall establish before 31 'Each year and in accordance with the pro- July whether production exceeds the maxi- cedure provided for in Article 43(2) of the mum guaranteed quantity for a variety or Treaty, the Council shall fix a maximum group of varieties.

5. Council Regulation (EEC) N o 1251/89 of 'The Council, ... shall lay down every year, 3 May 1989 amending the basic regulation 4 for each tobacco variety or group of varieties ('the additional regulation') made, inter alia, produced in the Community for which certain additions to the first subparagraph of prices and premiums are fixed, a maximum Article 4(5) of the basic regulation. The first guaranteed quantity for the following year's recital in the preamble to the additional harvest, 5 taking into account the market regulation is worded as follows: situation and the socio-economic and agri- cultural situation in the areas concerned. The Coundl shall set the maximum guaranteed quantities for the 1990 harvest at the same time as for the 1989 harvest. The overall maximum quantity for the Community is set for each of the 1988, 1989 and 1990 harvests '... pursuant to Article 4(5) of [the basic at 385 000 tonnes of leaf tobacco.' regulation] ... there is fixed within an overall Community quantity a maximum guaranteed quantity for each of the tobacco varieties or groups of varieties grown in the Community, overshooting of which gives rise to a propor- tional reduction in prices and premiums; ... 7. Council Regulation (EEC) N o 1252/89 of these maximum guaranteed quantities are 3 May 1989 fixing, for the 1989 harvest, the fixed every year, at the same time as prices norm and intervention prices and the premi- and premiums, for a specific harvest; ... in ums granted to purchasers of leaf tobacco, order to allow planting to be planned the the derived intervention prices for baled

10. Commission Regulation (EEC) No 2046/ 90 of 18 July 1990 determining, for tobacco from the 1989 harvest, the quantity actually produced and the prices and premiums pay- able under the system of maximum guaran- 8. Commission Regulation (EEC) No 2158/89 teed quantities 9 ('the 1989 control regu- of 18 July 1989 determining, for tobacco lation') stated that production of the Tsebelia from the 1988 harvest, the quantity actually and Mavra varieties in 1989 exceeded the produced and the prices and premiums pay- maximum guaranteed quantity for those able under the system of maximum guaran- varieties by 44.1%, and the premium for teed quantities 7 ('the 1988 control regu- those varieties was reduced by 15%, which lation') stated that production of the Bright was the maximum reduction in 1989. variety in 1988 exceeded the maximum guar- anteed quantity for that variety by 10.8%, and the premium for that variety was accordingly reduced by 5%, which was the maximum reduction in 1988.

11. Council Regulation (EEC) N o 1738/91 of 13 June 1991 fixing, for the 1991 harvest, the norm and intervention prices and the premiums granted to purchasers of leaf 9. Council Regulation (EEC) N o 1331/90 of tobacco, the derived intervention prices for 14 May 1990 fixing, for the 1990 harvest, the baled tobacco, the reference qualities, the norm and intervention prices and the premi- production areas and the guaranteed maxi- ums granted to purchasers of leaf tobacco, mum quantities and amending the 1990 guar- the derived intervention prices for baled anteed quantities regulation 10 ('the 1991 tobacco, the reference qualities, the produc- guaranteed quantities regulation') laid down tion areas and the guaranteed maximum maximum guaranteed quantities for each quantities for the 1991 harvest and amending

12. In July 1989 the processing undertaking Odetti Nikou Petridi Anonymos Kapnem- boriki AE ('Petridi') concluded contracts with a number of tobacco producers con- cerning cultivation of the Tsebelia tobacco variety for the 1989 harvest. 15. The Irinodikio, Echinos, stayed the pro- ceedings by decision of 24 July 1995 and requested the Court of Justice to deliver a preliminary ruling on the questions set out below. Parts of the questions are included in the outline of the facts and must therefore be 13. Pursuant to those cultivation contracts, reproduced in the form of excerpts from it. Petridi in May 1990 purchased the tobacco producers' 1989 Tsebelia harvest. Petridi subsequently received a 100% advance on the premium from the National Tobacco Agency in Greece in return for the lodging of security. 11As a result of the overproduc- tion of Tsebelia and Mavra during the 1989 '1. Is [the basic regulation] valid, inasmuch harvest, as established by the 1989 control as, in Article 1 thereof, the Council laid regulation, and the resultant reduction of the down for the whole of the Community premium by 15%, Petridi was requested by a maximum guaranteed quantity of the National Tobacco Agency in 1993 to 385 000 tonnes of leaf tobacco for the repay 15% of the amount which it had 1988, 1989 and 1990 harvests, while at received. the same time it was provided that for every 1 % by which the maximum guar- anteed quantity was exceeded per vari- 11 — Under Article 6(1) of Regulation (EEC) N o 1726/70 of the ety or group of varieties there would be Commission of 25 August 1970 on the procedure for grant- a corresponding reduction of 1% in the ing the premium for leaf tobacco (OJ , English Special Edi- tion 1970 (II), p. 587; original reference JO 1970 L 191, intervention prices and premiums, p. 1), the right to the premium accrued (only) when the where such reductions, in particular for tobacco left the place in which it was under supervision. For a more detailed examination, see my Opinion of the 1989 harvest, could not exceed 15% 15 May 1997 in Case C-244/95 P. Moskof v Ethnikos Organismos Kapnou [1997] ECR I-6441, I-6444. and, in light particularly of the fact that

3. If the reply to the preceding question is 2. (a) Since the defendant tobacco produc- affirmative, then in view of the finding ers had, however, not merely on by the Commission of actual overpro- 11 May 1989 (publication of [the duction and an exceeding by 44.1% of 1989 guaranteed quantities regu- the maximum guaranteed quantities of lation]) but even on 3 May 1989 [the the Tsebelia and Mavra varieties in the date on which the regulation was 1989 harvest [Annex I to the 1989 con- adopted] already planted the Tsebe- trol regulation], and the imposition for lia tobacco variety for the 1989 har- that reason of a reduction in the pre- vest, the question arises as to how mium and intervention price in the the objective which the preamble to maximum amount of 15% [Annex II to [the additional regulation] confers the 1989 control regulation], which with on the maximum guaranteed quanti- regard to the Tsebelia variety came to ties, namely to allow planting to be E C U 2.304 and E C U 2.037 respectively, planned, could have been attained. is [the 1989 control regulation] valid and may we apply, as the applicant con- tends, the clause of the cultivation con- tracts entered into on the basis of Com- mission Regulation N o 4263/88 concerning a reduction in the agreed prices, featuring in the annex (clause 8, second paragraph and in particular the (b) ... the Irinodikio is unsure whether third paragraph) to that regulation and [the additional regulation and the which features in the cultivation con- 1989 guaranteed quantities regu- tracts concluded by the defendants with lation] are valid so far as regards the the applicant undertaking, and which fixing of the maximum guaranteed provides as follows: "Notwithstanding quantities for tobacco of the Tsebe- the provisions of the preceding subpara- lia variety for the 1989 harvest and graph, if the prices or the premium for whether their application is con- the tobacco variety indicated in para- trary to the general principles of the graph 1 are adjusted by a Community prohibition concerning retroactive Regulation, the purchaser and the ven- application of Community legisla- dor shall renegotiate the contract price. tion, of the protection of the legiti- Where those prices or premiums are mate expectations of producers adjusted pursuant to Article 4(5) of [the

4. In order to reply to the foregoing ques- tions, the consequential question finally arises as to whether the factors which in 1991 led the Court of Justice in Case 16. By its first question, the national court is C-368/89 to annul the regulation laying seeking to ascertain whether the amending down maximum guaranteed quantities regulation is invalid on the ground that it for the 1988 harvest of the Bright vari- lays down a maximum guaranteed quantity ety are likewise present in this case in of 385 000 tonnes for each of the years 1988, view of the fact that the Commission 1989 and 1990 and also provides that in cases made the same mistake in delaying the where the guaranteed quantity is exceeded determination of maximum guaranteed there should be a general percentile reduc- quantities for the 1989 harvest, such tion in the intervention price and premium that it was also not possible to meet the corresponding to the percentage by which specified objective of planning planting the guaranteed quantity is exceeded, irre- in good time by reason of the special spective of the individual producer's volume climatic conditions obtaining in the and without distinguishing the different tobacco region in which Tsebelia is cul- tobacco varieties. tivated or the more general objective of fixing maximum guaranteed quantities, which was solely to prevent overpro- duction of problematic varieties such as Tsebelia and Mavra. 17. In the Crispoltoni II judgment, 12 a simi- lar question arose as to the legality of the system established by the amending regu- lation. The Court concluded that consider- ation of the questions raised in that case dis- closed no factor of such a kind as to affect the validity of the amending regulation or the regulations implementing it. In my view, 5. Finally, in the event that the Court of the Court thereby addressed the same objec- Justice should rule that the (Council tion as that raised in the present case to the and Commission) regulations in ques- validity of the amending regulation. For that tion are valid, how are they to be con- strued in regard to the question whether the processing undertaking Odetti Nikou Petridi Anonymos Kapnembo- 12 — Judgment in Joined Cases C-133/93, C-300/93 and C-362/93 Crispoltoni and Othen v Fattoria Autonoma riki AE or the defendant tobacco Tabacchi and Donátok [1994] ECR I-4863.

18. By headings (a) and (b) of the second question, the national court is seeking to determine whether the 1989 guaranteed quantities regulation and the additional regu- 21. Petridi states in its pleadings that sowing lation are invalid. of Greek tobacco varieties, including Tsebe- lia, takes place from the end of January to early February in southern regions and dur- ing the first ten days of March at the latest in northern regions of Greece. Transplanting of the young plants takes place in March in southern regions and in April in the north- ern regions. Harvesting is carried out two to three months after transplanting, that is to 19. Supported by the Greek Government, say, from the end of June to 15 August. Petridi has argued, inter alia, that the 1989 guaranteed quantities regulation was adopted and published after the 1989 harvest had been planted out and thus applies retroac- tively. Producers were for that reason unable to plan the 1989 harvest, as intended by the additional regulation. The objective of the 1989 guaranteed quantities regulation, namely to limit production of the least 22. The order for reference further states sought-after varieties, could for that reason that Tsebelia producers carried out trans- not be attained. planting in March 1989.

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In the absence of any other reason indicated 13 — Judgment in Case C-368/89 Crispoltoni v Fattoria Autonoma Tabacchi di Città di Castello [1991] ECR I-3695. in the preambles to [the amending regu-

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PETRIDI v SIMOU AND OTHERS

lation] and [the 1988 guaranteed quantities in the Community's tobacco production and regulation], it must therefore be held that the at the same time to discourage the growing first condition for the retroactivity of those of varieties which are difficult to dispose of, regulations to be permitted, namely that the could not be achieved, with respect to the purpose to be achieved so demands, is not 1989 harvest of tobacco of the Tsebelia vari- fulfilled and, consequently, those regulations ety, in a similar fashion to the case just cited, are invalid in so far as they lay down a maxi- since the planting out had already taken mum guaranteed quantity for tobacco of the place on 11 May 1989, the date on which the "Bright" variety harvested in 1988. [para- 1989 guaranteed quantities regulation was graph 20] published.

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28. In Crispoltoni II, it was argued that the pointed out, that the M G Q for the 1991 har- amending regulation infringed the principle vest for the "Burley I" variety had already of the protection of legitimate expectations. been fixed by Annex V to [the 1990 guaran- The Court ruled on this point, inter alia, as teed quantities regulation], [paragraph 71] follows:

Although Annex V to [the 1991 guaranteed 'The system at issue, whose distinguishing quantities regulation], pursuant to Article 4 features are that for a given variety M G Q s thereof, replaced for the intervening period [maximum guaranteed quantities] are set and Annex V to [the 1990 guaranteed quantities known in advance by the producers, that regulation], it did not alter the M G Q for the support is guaranteed for their entire pro- 1991 harvest for the "Burley I" variety, duction and that a ceiling is set for the [paragraph 72] reduction of prices and premiums, satisfies the requirements of the principle of the pro- tection of legitimate expectations' (paragraph 61).

The latter regulation was published in the Official Journal of the European Communi- ties of 23 May 1990, that is to say, well before the producers in question had to take 29. The Court thus emphasised in that judg- their decisions concerning the 1991 harvest, ment how important it was that the guaran- [paragraph 73] teed quantities for individual varieties should be set in advance.

The alleged breach of the principle of the 30. It was further argued in Crispoltoni II protection of legitimate expectations has that the 1991 guaranteed quantities regu- therefore not been established, [para- lation was invalid in that it had been pub- graph 74]' lished on 26 June 1991, whereas transplant- ing had taken place in April 1991. The Court stated as follows in this regard:

34. The additional regulation was adopted on 3 May 1989 and published on 11 May 1989, that is to say, after the transplanting had taken place in March 1989. The provi- sion that the maximum guaranteed quantities 32. The conclusion, in my opinion, must for the 1989 and 1990 harvests should be set accordingly be drawn that, not only for the at the same time therefore implies that the 1988 harvest, in which the maximum guaran- maximum guaranteed quantity for 1989 is to teed quantity system was applied for the first be set after transplanting. The additional time, but also for the subsequent harvests, it regulation thus has retroactive effect in the was of fundamental importance for compli- same way as the 1989 guaranteed quantities ance with the prohibition of retroactive regulation. In my view, the additional regu- effect and the protection of legitimate expec- lation is therefore invalid for the same rea- tations that maximum guaranteed quantities sons and to the same extent as the 1989 guar- should be set and published before produc- anteed quantities regulation. ers made plans for the harvest which the Community wished to influence by setting the same maximum guaranteed quantities. The Council ought therefore to have ensured that it set the maximum guaranteed quanti- ties well before producers planned the 1989 harvest.

35. I accordingly propose that the Court's answer to headings (a) and (b) of the second question should be that the 1989 guaranteed quantities regulation and the additional regu- 33. The first recital in the preamble to the lation are invalid in so far as they involve the additional regulation provides: '... on the fixing of a maximum guaranteed quantity for present occasion the quantities for both the tobacco of the Mavra and Tsebelia varieties 1989 and 1990 harvests should therefore be harvested in 1989.

(2) Council Regulation (EEC) N o 1252/89 of 3 May 1989 fixing, for the 1989 har- vest, the norm and intervention prices and the premiums granted to purchasers of leaf tobacco, the derived intervention prices for baled tobacco, the reference qualities, the production areas and the guaranteed maximum quantities and amending Regulations (EEC) N o 1577/86, (EEC) N o 1975/87 and (EEC) N o 2268/88 and Council Regulation (EEC) N o 1251/89 of 3 May 1989 amending Regulation (EEC) N o 727/70 on the common organisation of the market in raw tobacco are invalid in so far as they involve the fixing of a maxi- mum guaranteed quantity for tobacco of the Mavra and Tsebelia varieties har- vested in 1989.

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