Casa Fleischhandels-GmbH v Bundesanstalt fuer landwirtschaftliche Marktordnung. (Agriculture ) [1989] EUECJ R-215/88 (13 July 1989)

Judgment 1 By order of 26 May 1988, which was received at the Court of Justice on 2 August 1988, the Bundesverwaltungsgericht ( Federal Administrative Court ) referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty three questions concerning the interpretation of a number of provisions of the Community rules on private storage for beef and veal and in particular of Regulation ( EEC ) No 1071/68 of the Commission of 25 July 1968 laying down detailed rules for granting private storage aid for beef and veal ( Official Journal, English Special Edition 1968 ( II ), p . 354 ), Regulation ( EEC ) No 2778/74 of the Commission of 31 October 1974 on the granting at a standard rate fixed in advance of private storage aid for beef ( Official Journal 1974 L 294, p . 73 ), Regulation ( EEC ) No 1860/75 of the Commission of 18 July 1975 on the granting of private storage aid for beef ( Official Journal 1975 L 188, p . 30 ), Regulation ( EEC ) No 2711/75 of the Commission of 24 October 1975 on the granting at a standard rate fixed in advance of private storage aid for beef ( Official Journal 1975 L 274, p . 27 ) and Commission Regulation ( EEC ) No 1500/76 of 25 June 1976 on the granting of private storage aid for beef at a standard rate fixed in advance ( Official Journal 1976 L 167, p . 31 ). 2 Those questions arose in a dispute between the plaintiff in the main proceedings, Casa Fleischhandels-GmbH ( hereinafter referred to as "Casa "), a company dealing in meat, and the Bundesanstalt fuer landwirtschaftliche Marktordnung ( hereinafter referred to as "the Federal Office "), which is the German intervention agency for agricultural products . 3 It appears from the documents before the Court that, between November 1974 and July 1976, the plaintiff in the main proceedings concluded various contracts with the Federal Office in order to qualify for private storage aid for beef . As a result of checks which it carried out following the payment of the aid, the intervention agency reached the conclusion that, in the case of three of the contracts, the conditions governing the grant of aid as laid down in the relevant Community rules had not been fully complied with by Casa . 4 In the case of one contract concluded pursuant to Regulation No 2711/75 of 24 October 1975, the Federal Office found that the quantity of meat placed in storage by Casa and derived from animals slaughtered within the period stipulated by the regulation was less than 90% of the quantity specified in the contract and that, consequently, under the provisions of Article 9(3)(b ) of that regulation, no aid whatsoever ought to have been paid . With regard to each of the other two contracts, which had been concluded pursuant to Regulation No 1500/76 of 25 June 1976, the Federal Office observed that some of the meat had been placed in storage more than six days after the animals had been slaughtered, that is to say, after the expiry of the maximum period laid down by Regulation No 1071/68 of 25 July 1968; in the view of the Federal Office, Regulation No 1500/76 did not contain any provision derogating from Regulation No 1071/68 in respect of that maximum period . It was therefore considered that the amount of aid corresponding to that quantity of meat had been wrongly paid . 5 Following the rejection of the objection which it had lodged against the repayment notices issued by the Federal Office, Casa brought the matter before the Verwaltungsgericht ( Administrative Court ), which rejected the application in so far as it concerned the repayment notice relating to the first of the aforementioned contracts . On the other hand, the court set aside the repayment notices relating to the other two contracts on the ground that the period of six days specified in Regulation No 1071/68 had been extended to 10 days by Regulation No 2711/75 and that the latter period had been kept in force by Regulation No 1500/76 . 6 Both parties appealed to the Verwaltungsgerichtshof ( Higher Administrative Court ), Hesse, which reversed the judgment in so far as it had found in favour of Casa and upheld the rest of it . Casa' s original claims were thereby rejected in their entirety . 7 Casa appealed on a point of law to the Bundesverwaltungsgericht ( Federal Administrative Court ), which decided to stay the proceedings until the Court of Justice had given a preliminary ruling on the following questions : "1 . Must the expression 'quantity placed in store' in the first sentence of Article 9(3 ) of Regulation ( EEC ) No 2711/75 of the Commission of 24 October 1975 be interpreted as covering only the quantity placed in store that is eligible for aid? 2 . What is the legal relationship between the provisions set out below, and in particular : ( a ) Was the rule contained in Article 2(2 ) of Regulation ( EEC ) No 1071/68 of the Commission of 25 July 1968 (' not more than six days previously' ) revoked ( aa ) either specifically as regards the granting of aid at a standard rate fixed in advance, by the different rule laid down in Article 5 of Regulation ( EEC ) No 2778/74 of the Commission of 31 October 1974 (' not more than 10 days previously' ), ( bb ) or in general by the different rule laid down in Article 5 of Regulation ( EEC ) No 1860/75 of the Commission of 18 July 1975 (' not more than 10 days previously' ) and is it therefore partly or wholly invalid? ( b ) Was the abovementioned rule laid down in Article 5 of Regulation ( EEC ) No 2778/74 revoked ( aa ) either by the identical rule contained in Article 5 of Regulation ( EEC ) No 2711/75 of the Commission of 24 October 1975 (' not more than 10 days previously' ), ( bb ) or by Regulation ( EEC ) No 1500/76 of the Commission of 25 June 1976? ( c ) If the answer to Question 2(b)(aa ) or Question 2(b)(bb ) is yes : Was the rule in Article 5 of Regulation ( EEC ) No 2711/75 revoked by Regulation ( EEC ) No 1500/76? ( d ) If the answer to Question 2(a)(aa ) and Question 2(a)(bb ) is no and the answer to either Question 2(b)(bb ) or Question 2(c ) is yes : Did the rule in Article 2(2 ) of Regulation ( EEC ) No 1071/68 once again become applicable to the granting of aid at a standard rate fixed in advance when Regulation ( EEC ) No 1500/76 entered into force? 3 . If the answer to Question 2(a)(aa ) or Question 2(a)(bb ) is yes or the answer to Question 2(b)(bb ) or Question 2(c ) is no : Were the Member States entitled to stipulate, in storage contracts concluded pursuant to Article 1 ( 3 ) of Regulation ( EEC ) No 989/68 of the Council of 15 July 1968, another period different from the period of 10 days laid down in an EEC regulation, and in particular a shorter period such as a period of only six days, with the result that if such shorter period is not complied with there will be no right to the payment of aid?" 8 Reference is made to the Report for the Hearing for a fuller account of the facts, the relevant Community legislation and the observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court . First question 9 In its first question the national court asks if Article 9(3 ) of Regulation No 2711/75 of the Commission of 24 October 1975 must be interpreted as meaning that "the quantity placed in store" may consist only of meat which satisfies the conditions governing the grant of private storage aid for beef . 10 Article 9(3 ) of Regulation No 2711/75 provides that : "In the case of meat stored without cutting or boning, if the quantity placed in store is less than the quantity contracted for but equal to : ( a ) 90% or more of that quantity, the amount of private storage aid shall be reduced proportionately; ( b ) less than 90% of that quantity, private storage aid shall not be paid ". 11 The Bundesverwaltungsgericht considers that there are doubts as to whether the "quantity placed in store", within the meaning of the aforementioned provision, must consist only of meat which satisfies the conditions governing the grant of aid : while the letter of the provision seems to support the view that this is not the case, the spirit of the provision suggests an affirmative interpretation . 12 The Commission argues in its observations to the Court that the wording of the provision in question is not, in itself, conclusive, but that in view of the aim of the provision the question should be answered in the affirmative . 13 It should be pointed out that Article 3(1 ) of Regulation No 1071/68 of the Commission of 25 July 1968, which lays down general implementing rules for granting private storage aid for beef and veal, provides that the contract concluded between the private storer and the intervention agency is to cover, inter alia, the "quantity of the product to be stored", and Article 3(2 ) of that Regulation stipulates that the contract is to impose on the storer the obligation to "take the agreed quantity of the product into store and store it ". Moreover, according to Article 3(4 ), "The obligation to store the agreed quantity shall be considered as fulfilled if not less than 90% and not more than 110% of that quantity has been taken in store and stored ". 14 It was for the purpose of specifying the consequences of a failure to fulfil that obligation that Regulation No 2711/75, dealing with a specific aid programme, included the provisions of Article 9 which have now to be interpreted . 15 The object of those provisions is to ensure that the economic operator who receives aid honours his commitments in respect of the quantity of meat which he has undertaken to place in store and to store under the terms of the contract concluded with the intervention agency, and to penalize him, should he fail to honour those commitments, by partial or total loss of aid . 16 In view of the general scheme and aims of those rules the expression "quantity placed in store" should be interpreted as meaning that, under the Community aid system, only meat which satisfies the conditions governing the grant of aid may be stored . 17 If the storage contract may relate only to meat which satisfies those conditions, the question whether the private storer has fulfilled his quantitative undertakings must be assessed by reference to only that meat which has actually been placed in store and which also satisfies those conditions . 18 Furthermore, the obligation to place in store the quantity agreed in the contract would in practice be subject to no sanction if, in order to circumvent that sanction, a private storer merely had to make up any shortfall in meat satisfying the conditions governing the grant of aid by adding other meat not satisfying those conditions . In the same way, the private storer could also circumvent the rule laid down in Article 2 of Regulation No 2711/75, which stipulates that "the minimum quantity per contract shall be 50 metric tonnes" and which seeks to prevent the Community from having to finance normal private storage . 19 Finally, only that interpretation of the phrase "quantity placed in store" enables any meaning to be given to Article 9(3)(a ) of Regulation No 2711/75, which provides that the amount of aid is to be reduced proportionately to the quantity placed in store as a percentage of the quantity contracted for . It would not be possible to allow the quantity placed in store to be taken into account in that way for the purposes of calculating the amount of aid, if that quantity could be made up, even if only to some extent, of meat which did not satisfy the conditions governing the grant of aid . 20 The answer to the first question must therefore be that Article 9(3 ) of Regulation No 2711/75 of the Commission of 24 October 1975 must be interpreted as meaning that "the quantity placed in store" may consist only of meat satisfying the conditions for the grant of private storage aid in the beef and veal sector . Second question 21 In its second question, the national court is essentially asking how the various regulations which have been adopted with regard to private storage aid in the beef and veal sector relate to each other, with a view to determining whether Article 2(2 ) of Regulation No 1071/68 of the Commission of 25 July 1968, under which "private storage aid may be granted only for products derived from animals slaughtered not more than six days previously", was repealed by Regulation No 2778/74 of the Commission of 31 October 1974, by Regulation No 1860/75 of the Commission of 18 July 1975, or by Regulation No 2711/75 of the Commission of 24 October 1975, and whether that provision was applicable to aid granted pursuant to Commission Regulation No 1500/76 of 25 June 1976 . 22 The Bundesverwaltungsgericht observes that Article 5 of Regulation No 2778/74 derogates from the aforementioned provision of Regulation No 1071/68 by extending to 10 days the maximum period which may elapse between the slaughter of animals and the placing in storage of the products derived from those animals . It takes the view that that extension of the time-limit was maintained by Regulation No 1860/75 and confirmed by Regulation No 2711/75 . The need to adapt certain of the conditions laid down in Regulation No 1071/68, including that which relates to the lapse of time between slaughtering and placing in store is reiterated in the preamble to Regulation No 1500/76 . However, the operative part of Regulation No 1500/76 contains no provision specifying the time-limit to be observed or making it possible to state that the 10-day period laid down in Regulations Nos 2778/74, 1860/75 and 2711/75 no longer applies . 23 As the Commission observed before the Court, Article 8(2 ) of Regulation ( EEC ) No 805/68 of the Council of 27 June 1968 on the common organization of the market in beef and veal ( Official Journal, English Special Edition 1968 ( I ), p . 187 ), as amended by Regulation ( EEC ) No 2822/72 of the Council of 28 December 1972 ( Official Journal, English Special Edition 1972 ( 30 to 31 December ), p . 28 ) provides that detailed rules on private storage aid are to be adopted by the Commission in accordance with so-called management committee procedure; under Article 6(5)(b ) of that regulation the implementation of a given programme of aid and the date on which it is to cease to apply are to be determined by the Commission in accordance with the same procedure . 24 It was in that way that the Commission, pursuant to the aforementioned Article 8(2 ), adopted Regulation ( EEC ) No 1071/68 laying down detailed rules for granting private storage aid for beef and veal . Those general rules, whose application is not limited in time, are intended in principle to govern all aid granted for that purpose, with the single exception, which is not relevant in the present case, of aid "granted either in whole or in part in the form of the entitlement under Article 14(3)(b)(aa )" of Regulation No 805/68 . 25 It was also in that way that the Commission adopted Regulations Nos 2778/74, 1860/75, 2711/75 and 1500/76, to which the national court refers . Each of those regulations, which were based in particular on Article 6(5)(b ) of Regulation No 805/68, was intended to implement and lay down detailed rules for a specific programme of aid as a response to a particular situation on the beef and veal market and for a limited period of time . Those regulations ceased to apply as a result of the adoption of Commission Regulations No 776/75 of 25 March 1975 ( Official Journal 1975 L 77, p . 20 ), No 2698/75 of 23 October 1975 ( Official Journal 1975 L 273, p . 26 ), No 3194/75 of 5 December 1975 ( Official Journal 1975 L 316, p . 16 ) and No 1924/76 of 3 August 1976 ( Official Journal 1976 L 210, p . 15 ), respectively, which limited the effects of those regulations until a date which they determined . 26 It follows from the foregoing that, where the "specific" Regulations Nos 2778/74, 1860/75 and 2711/75 contained provisions differing in certain respects from the provisions of Regulation No 1071/68 - which was permissible because they too were adopted under Article 8(2 ) of Regulation No 805/68 - those divergent provisions were valid only so long as those regulations remained in force . They did not have the aim, or the effect, of repealing the provisions of Regulation No 1071/68 from which they merely "derogated ". 27 As regards, more specifically, the maximum period which may elapse between the slaughter of animals and the placing in store of products derived from those animals, this was fixed at six days by Article 2(2 ) of Regulation No 1071/68 . Regulations Nos 2778/74, 1860/75 and 2711/75 provided, by way of derogation from Article 2(2 ) of Regulation No 1071/68, that the time-limit would be extended to 10 days "in order to facilitate storage operations ". 28 As has just been explained, those derogating provisions ceased to apply at the same time as the regulations in which they were incorporated, and did not repeal the rule relating to a time-limit of six days laid down by Regulation No 1071/68 . 29 That rule therefore remained applicable to aid granted under Regulation No 1500/76, since the operative part of that regulation does not contain any derogation in that respect from Regulation No 1071/68 . 30 That conclusion cannot be called in question on the ground that, as the order for reference points out, the German version of Regulation No 1500/76 contains a recital with the same wording as recitals in the preambles to Regulations Nos 2778/74, 1860/75 and 2711/75, which states that it is appropriate to adapt certain conditions laid down in Regulation No 1071/68, including the condition concerning the time elapsing between slaughtering and placing in private storage . 31 Whilst a recital in the preamble to a regulation may cast light on the interpretation to be given to a legal rule, it cannot in itself constitute such a rule . Moreover, the recital in question does not appear in any of the other language versions of Regulation No 1500/76 . 32 In view of the foregoing considerations, the answer to the second question must be that Article 2(2 ) of Regulation No 1071/68 of the Commission of 25 July 1968 was not repealed by Regulation No 2778/74 of the Commission of 31 October 1974, by Regulation No 1860/75 of the Commission of 18 July 1975 or by Regulation No 2711/75 of the Commission of 24 October 1975, and, in the absence of a derogating provision in Commission Regulation No 1500/76 of 25 June 1976, it was applicable to aid granted under the latter regulation . Third question 33 It appears from the order for reference that, in its third question, the national court is asking essentially whether, in the event that in the case of aid granted under Regulation No 1500/76 the maximum period between slaughtering and placing in storage is 10 days, Member States are entitled to stipulate that contracts concluded between private storers and the competent intervention agency should require compliance with a different period, and in particular a shorter one . 34 In view of the answer to the second question, there is no need to answer this question . Costs 35 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable . Since these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court . On those grounds, THE COURT ( Third Chamber ), in reply to the questions referred to it by the Bundesverwaltungsgericht by order of 26 May 1988, hereby rules : ( 1 ) Article 9(3 ) of Regulation No 2711/75 of the Commission of 24 October 1975 must be interpreted as meaning that "the quantity placed in store" may consist only of meat satisfying the conditions for the grant of private storage aid in the beef and veal sector . ( 2 ) Article 2(2 ) of Regulation No 1071/68 of the Commission of 25 July 1968 was not repealed by Regulation No 2778/74 of the Commission of 31 October 1974, by Regulation No 1860/75 of the Commission of 18 July 1975 or by Regulation No 2711/75 of the Commission of 24 October 1975, and, in the absence of a derogating provision in Commission Regulation No 1500/76 of 25 June 1976, it was applicable to aid granted under the latter regulation . © European Communities, 2001 All rights reserved BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII