C-376/97

Relevant regulations 5. Initially intended as a temporary mechanism to reduce the need for interven- 3. Until 1987 support for the market in tion and gradually to restore the original beef and veal, 1 designed to prevent or purpose of intervention, which was to control a significant fall in prices, was provide a safety net, 5 the special premium principally provided through public buy- has now been introduced for an unlimited ing-in. However, finding that 'public inter- period. 6 vention has gradually lost its original function as a safety net and has become an outlet in its own right', 2 the Council 3 — Ibid., sixth recital. decided that year, by adopting Regulation 4 — Ibid., seventh recital. The regulations under which the existing premiums referred to were paid are as follows: '... No 467/87, to limit public buying-in but at Regulation (EEC) No 1346/86 of 6 May 1986 on the the same time to offset the effect of the granting of a calf birth premium in Greece, Ireland, Italy and Northern Ireland and on the granting of an additional adjustment thus adopted through provision national premium in Italy, as amended by Regulation (EEC) No 4049/86, and Council Regulation (EEC) No 1347/86 of 6 May 1986 on the granting of a premium for the slaughter of certain adult bovine animals in the United Kingdom, as amended by Regulation (EEC) No 4049/86'. * Original language: French. 5 — Article 1 of Regulation No 467/87 provided originally that 1 — The basic regulation in this field is Regulation (EEC) the special premium could be granted from 6 April 1987 to No 805/68 of the Council of 27 June 1968 on the common 31 December 1988. This period was extended by the organisation of the market in beef and veal (OJ, English amending Council Regulation (EEC) No 4132/88 of Special Edition 1968 (I), p. 187). 20 December 1988 (OJ 1988 L 362, p. 4), until 5 March 2 — First recital in the preamble to Council Regulation (EEC) 1989. No 467/87 of 10 February 1987 amending Regulation No 6 — The fourth recital in the preamble to the amending Council (EEC) 805/68 on the common organisation of the market in Regulation (EEC) No 571/89 of 2 March 1989 provides beef and veal and the system of premiums granted in the for: 'maintenance beyond 2 April 1989 of the special beef and veal sector (OJ 1987 L 48, p. 1). premium scheme' (OJ 1989 L 61, p. 43).

5

10. Lastly, the detailed rules applying to the special premium were adopted by the Commission 1 0 in Regulation (EEC) No 714/89 of 20 March 1 9 8 9 , 1 1which 7. As those basic regulations provided, 7 lays down the conditions for granting the the Community legislature subsequently special premium provided for in the above- laid down the general rules governing that mentioned Article 4a. special premium scheme for beef producers and, in particular, clarified the terms 'pro- ducer' and 'holding' in the context of 8 — OJ 1989 L 63, p. 1. Council Regulation (EEC) No 572/89 of 9 — OJ 1987 L 48, p. 4. 10 — As provided in Article 4a(3) of the original Regulation No 805/68. 11 — Regulation laying down detailed rules applying to the 7 — Article 4a, cited above, paragraph 2. special premium for beef producers (OJ 1989 L 78, p. 38).

I - 3452

BEZIRKSREGIERUNG LÜNEBURG V WETTWER

11. Those conditions are that '... applica- No 714/89 provides: 'The control mea- tions [should] be accompanied by declara- sures shall cover in particular: tions and undertakings by recipients and [should] be subject to both administrative and on-the-spot checks by Member States regarding a minimum number of holdings, and give rise to total recovery of the sums paid should they turn out to be inexact'. 12 (a) the presence on the holding run by the producer of the number of male cattle covered by the application...;

12. In particular, the second indent of (b) the correctness of the required declara- Article 2 of Regulation No 714/89 pro- tions and fulfilment of the undertak- vides that applications for the premium ings made by the producer; must include 'an undertaking by the pro- ducer to retain the male animals for which he applies for the premium on his holding for the period fixed pursuant to Arti- cle 8(2)... at least until they are nine months old'. (c) compliance with the provisions on identification and marking...'

19. On appeal by the plaintiff in the main proceedings, the Niedersächsisches Ober- 17. In support of his appeal against that verwaltungsgericht (Higher Administrative refusal, the plaintiff in the main proceed- Court, Lower Saxony) reversed the first- ings argues that the conditions for granting instance judgment. Unlike the court below, the premium are still met because, since the Niedersächsisches Oberverwaltungsger- taking over the holding, his son has con- icht ruled that the special premium should tinued to comply with the obligations laid be granted to holdings and not to persons. down. The defendant in the main proceed- It held that the conditions for granting the ings contends, however, that the special premium were therefore met and that the premium at issue attaches to persons and premium should consequently be granted, not to holdings. following notification of the transfer, to the transferee.

18. The Verwaltungsgericht (Administra- tive Court) dismissed that appeal, ruling 20. It was in the course of the 'Revision' that the Bezirksregierung's interpretation of proceedings brought by the Bezirksregier- Article 4a(l) of Regulation No 805/68, as ung against that judgment that the Bundes- amended by Regulation No 571/89, was verwaltungsgericht, finding that there were correct; according to that interpretation, arguments in favour of both propositions, the premium is granted to persons and not referred the following question to the Court to holdings, as is apparent from the defini- for a preliminary ruling: tion of the term 'producer'. The plaintiff in the main proceedings was no longer a

ferred to a producer to whom, during the original applicant's premium could be compulsory stock holding period, the appli- transferred to him at the same time as the cant transferred his agricultural holding by holding. Just consider one of the require- way of anticipated succession inter vivos ments for granting the premium: the pre- and who carried out the prescribed keeping mium is limited to 90 animals per calendar and fattening of the bovine animals in year and per holding and is granted once question?' only for each animal. An undertaking given by the applicant for the premium cannot be sufficient to ensure compliance with that condition by his successor. It is in fact quite possible that the transferee of the holding, if he himself is a producer as in the present case, has already used up the quota. As a holding is defined as 'all the production Comment units operated by the producer on the territory of a single Member State', 17 the transferee cannot seek to receive the pre- miums originally applied for if he has 21. As the court hearing the case at first already received the maximum permitted instance pointed out, 14 by contrast with amount for the animals which he has been the system for granting other Community keeping previously. I find it difficult, there- premiums, such as the premiums for the fore, to accept the automatic transfer of non-marketing of milk and milk products entitlement to the premium when the and for the conversion of dairy herds under legislation at issue makes no provision for Regulation No 1078/77, 15 or the premium an individual undertaking to be given by for maintaining suckler cows introduced by the transferee of the holding. Regulation (EEC) No 1244/82, 16 Commu- nity legislation concerning the beef and veal producers' premium made no provision for the assumption of the obligations in ques- tion by a legal successor. 23. It seems to me that this lacuna actually reflects a deliberate choice on the part of the legislature to exclude transfer of enti- tlement to the premium in the event of the transfer of the holding, and that, on the contrary, it is not an oversight which can be 22. Such an undertaking on the part of the remedied by reference to general principles successor would be essential, however, if it or by analogy with other provisions of were accepted that entitlement to the Community law.

provision has been made for systems of to the person taking over his holding. He equivalent aid or premiums, they are gen- may also transfer, in full or in part, his erally designed to relate to the person of the rights to other producers without transfer- applicant and not to the holding. In the ring his holding. 20 event of the holding being transferred, save where express provision or special arrange- ments have been made, entitlement to the premium lapses and does not follow the property. 28. It is more usual for attachment of the premium to the person who applied for it to be implicit; moreover, there is scarcely any doubt about this in the light of the case-law of the Court. 25. In certain common organisations of markets, the legislature itself has taken care to state expressly that entitlement to a premium relates to the producers to whom the premium is granted. 29. This is the case as regards premiums for the non-marketing of milk and milk pro- ducts, in respect of which the Court has held that 'the undertaking entered into by the recipient of a premium not to dispose of 26. This is the case in the sheepmeat and milk or milk products... binds the recipient goatmeat sector. 18 personally and does not attach to the property. In the event of a disposal of the property or of the right to farm the land, the recipient loses his entitlement to the premium'. 21 For that reason, the Court has 27. The same applies in the beef and veal held: 'In the event of the disposal of the sector, which concerns us here, as regards dairy cows which were held on the farm at the grant of premiums other than the one at the time when the application was made issue. Thus, entitlement to the premium for and which gave entitlement to the pre- maintaining suckler cows has, since 1992, mium, the burden of the undertaking given expressly attached to the producers to by the recipient to withhold milk and milk whom the premium was granted in respect products from the market does not pass to of the reference year and w h o also the buyer of those cows by virtue of that requested the premium for the years up to disposal'. 22 and including 1992. 1 9The same rules provide that where a producer sells or otherwise transfers his holding, he may transfer all his suckler cow premium rights 30. The Court ruled along the same lines a few years later when reference quantities 18 — See, in particular, Article 5a(4)(a) of Council Regulation (EEC) No 3013/89 on the common organisation of the market in sheepmeat and goatmeat, as amended by Council Regulation (EEC) No 2069/92 of 30 June 1992 (OJ 1992 L 215, p. 59). 20 —Ibid. Article 4e(1). 19 — As provided in Article 4d(4) of Regulation No 805/68, as 21 — Case 77/79 Damas [1980] ECR 247, paragraph 8, amended by Council Regulation (EEC) No 2066/92 of emphasis added. 30 June 1992 (OJ 1992 L 215, p. 49). 22 — Ibid, paragraph 11.

32. Lastly, if one looks in particular at the Court's case-law relating to the legislation at issue, it is ultimately quite logical, in view of the way the case-law has devel- oped, for the same interpretation to be 3 1 . Recently the Court has been even more given as regards linking the premium to the explicit, clearly extending the scope of that producer. When called upon to interpret case-law beyond premiums granted within Article 9 of Regulation N o 714/89, which the common organisation of the market in lays down the penalties applicable in the m i l k a n d m i l k p r o d u c t s . In C a s e event of failure to comply with the condi- C-38/94, 24 the Court ruled that neither tions for granting the premium, the Court, the relevant provisions relating to the in its judgment in Case C-365/92, 26 pro- common organisation of the market in vided interesting clarification of the con- sheepmeat and goatmeat nor any general cept of the checks by competent national principle of Community law require Mem- authorities on the basis of which a penalty ber States to introduce a mechanism for may be imposed. By pointing out in parti- compensating detriment caused to owners cular, in the case of administrative checks, of agricultural land by the introduction of a that they include 'an examination of the system of premium rights linked to produ- documents submitted by the applicant for cers of sheepmeat, goatmeat or beef and the premium for the purpose of proving veal. It made clear in particular that no that he fulfils the conditions specified', 27 such obligation can be derived from the the Court was unambiguous in its ruling principle of protection of the right to that the grant of a premium was dependent property because the introduction of a on compliance with conditions provided system of premium rights attaching to for by the producer who applied for the producers, even if it has a detrimental premium. It must be inferred from this as

34. There are some cases in which, despite non-compliance with his obligations by the producer who applied for the premium, Whilst it is true that where the beneficiary entitlement to that premium subsists, and of the aid dies, a circumstance which is these are listed in Article 9 of Regulation regarded as force majeure under Arti- No 714/89. cle 9(3) of Regulation No 714/89, as we have seen, 29 entitlement to the premium is retained provided the producer has informed the competent authorities within ten days of the incident, the case we are considering here cannot have the same legal effects. This is not a case in which the 35. Such cases are where the reduction in beneficiary has died, which would have the number of animals which the producer resulted in an open succession. has undertaken to keep on his holding for the minimum period can be ascribed to 'natural circumstances affecting the herd' 28 — This provision refers, as regards clarification of the term (Article 9(2)), or where it is impossible to 'reasons of force majeure', 'especially' to those listed in Article 5 of Regulation No 1244/82, which include '(a) comply with the undertaking to keep cattle decease of the beneficiary...'. on the holding for that period for reasons 29 — Point 35 of this Opinion.

I - 3458

BEZIRKSREGIERUNG LÜNEBURG V WETTWER

38. Finally, confirmation of my opinion is to be found in the final circumstance provided for in Article 9(4) of Regulation No 714/89 exempting a producer from It would seem that this textual rigour, compliance with the conditions specified. which does however permit certain miti- That provision applies where the difference gating circumstances, should guide the between the number of animals declared Court's interpretation of the rules at issue. and the number of animals effectively I find a lack of consistency in allowing the eligible is less than 5%, or at most, one contested premium to be granted to the animal if the number of animals declared is transferee of a holding which has been equal to or less than twenty head, and that transferred during the minimum period for difference can be ascribed to reasons other which the original producer had in fact than those referred to in paragraphs 2 undertaken to keep on his holding the stock (reduction in the number of animals attri- in respect of which he applied for the butable to natural circumstances affecting premium, when that transferee has given no the herd) and 3 (impossibility of complying undertaking himself, whilst the producer, with the undertaking to keep the cattle on who believed in good faith that he com- the holding for a minimum period for plied with each of the undertakings which he had given, will not receive any premium

30 — Case C-263/97 First City Trading and Others [1998] ECR I-5537, paragraph 38, which refers in particular to Case 31 — According to Article 9(4), 'the premium less 20% shall be 145/85 Denkavit [1987] ECR 565, paragraph 11. paid for the number of eligible animals'.

The regulations governing the grant of a special premium to beef and veal producers in accordance with Article 4a of Regulation (EEC) N o 805/68 of the Council of 27 June 1968 on the common organisation of the market in beef and veal, as amended by Council Regulation (EEC) N o 571/89 of 2 March 1989 in conjunction with the implementing provisions of Council Regulation (EEC) N o 572/89 of 2 March 1989 and Commission Regulation (EEC) N o 714/89 of 20 March 1989, must be interpreted as meaning that entitlement to a beef and veal producers' premium for the year 1991 cannot be transferred to a producer to whom, during the compulsory stock holding period, the applicant transferred his agricultural holding by way of a gift inter vivos and who carried out the prescribed keeping and fattening of the bovine animals in question.

I - 3460