Federazione Italiana dei Consorzi Agrari v Azienda di Stato per gli Interventi nel Mercato Agricolo. (Preliminary rulings) [1992] EUECJ C-88/91 (25 June 1992)

Judgment 1 By order of 11 December 1990, received at the Court on 8 March 1991, the Corte d' Appello, Rome, referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question on the interpretation of the provisions of Community law contained in the fourth subparagraph of Article 3(2) and in Section VIII of Annex II to Council Regulation (EEC) No 3247/81 of 9 November 1981 on the financing by the European Agricultural Guidance and Guarantee Fund, Guarantee Section, of certain intervention measures, particularly those involving the buying-in, storage and sale of agricultural products by intervention agencies (OJ 1981 L 327, p. 1), as amended by Council Regulation (EEC) No 2632/85 of 16 September 1985 (OJ 1985 L 251, p. 1), in conjunction with the provisions of Regulation No 136/66/EEC of the Council of 22 September 1966 on the establishment of a common organization of the market in oils and fats (OJ, English Special Edition 1965-1966, p. 221), and the provisions of Commission Regulation (EEC) No 3472/85 of 10 December 1985 on the buying-in and storage of olive oil by intervention agencies (OJ 1985 L 333, p. 5). 2 The question arose in proceedings between Federazione Italiana dei Consorzi Agrari ("Federconsorzi"), the contractor responsible for intervention operations in the olive oil sector for the 1985/1986 marketing year, and Azienda di Stato per gli Interventi nel Mercato Agricolo ("AIMA") relating to the determination of the amount due following the discovery of the theft from Federconsorzi' s warehouses in Gioia Tauro of 6 127.33 quintals of lampante virgin olive oil which had been bought in during the 1983/1984 marketing year. 3 It appears from the case-file that Article 3 of the contract concluded between Federconsorzi and AIMA provided as follows: "the contractor shall be liable ... for any losses for which he is responsible to the amount stipulated by the Community legislation in force". 4 The Corte d' Appello considered that the case before it raised a question relating to the interpretation of Community law and decided to suspend the proceedings pending a preliminary ruling from the Court on the following question: "Are the provisions of Community law contained in the fourth subparagraph of Article 3(2) and in Section VIII of Annex II to Council Regulation (EEC) No 3247/81, as amended by Article 1 of Council Regulation (EEC) No 2632/85, in conjunction with the provisions contained in Regulation (EEC) No 136/66/EEC of the Council and in Commission Regulation (EEC) No 3472/85, to be interpreted as meaning that, for the purposes of European Agricultural Guidance and Guarantee Fund accounts, the value of lampante virgin olive oil, in intervention storage and subsequently stolen, is to be determined, having regard to the quantities stolen, on the basis of the price fixed ° in the marketing year in which the theft was noticed, increased by all the monthly increments ° for lampante virgin olive oil with 1o acidity or with the lowest degree of acidity recorded at the warehouse in question in the marketing year to which the stolen oil relates, or must that value be determined by specific and precise reference to the price paid on entry into store for the quantity and quality of the stolen oil, or by reference to a different criterion from those proposed above?" 5 Reference is made to the Report for the Hearing for a fuller account of the relevant legislation, the facts of the case, the procedure and the parties' arguments and pleas, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court. Jurisdiction of the Court 6 Since the national court has referred the question for a preliminary ruling in a context in which the Community legislation is applicable only through a contractual provision agreed between the parties to the main proceedings, the question arises as to whether the Court has been validly seised of the matter. 7 It should be observed in that regard that in Joined Cases C-297/88 and C-197/89 Dzodzi v Belgian State [1990] ECR I-3763 , which raised the question whether under Article 177 of the EEC Treaty the Court had no jurisdiction to give a preliminary ruling on a provision of Community law in the particular case where the national law of a Member State referred to the content of the provision in question in order to determine the rules applicable to a situation which was purely internal to that State, the Court held that it was manifestly in the interest of the Community legal order that, in order to forestall future differences of interpretation, every Community provision should be given a uniform interpretation irrespective of the circumstances in which it was to be applied. 8 Since the contractual provision at issue in this case refers to the content of rules of Community law in order to determine the extent to which one of the parties may incur financial liability, there is nothing to prevent the Court from giving a preliminary ruling on the interpretation of those rules. 9 It must therefore be held that the Court has jurisdiction in these proceedings for a preliminary ruling. 10 It is important to note that the Court has jurisdiction to consider only the provisions of Community law. In replying to the national court' s question, it may not take account of the scheme of the contract or of the provisions of national law which may determine the scope of the contractual obligations. Consideration of the limits which national law and the contract may set to the application of Community law is a matter for the national court to assess. Substance 11 It should first of all be borne in mind that Article 35 of Regulation No 136/66, cited above, provides as follows: "Without prejudice to the harmonization of legislation on olive oil for human consumption, Member States shall, for the purposes of intra-Community trade and trade with third countries, except in respect of exports to third countries, adopt the descriptions and definitions of olive oil set out in the annex to this regulation". 12 The annex to the regulation sets out, having regard to both organoleptic criteria and the differing degrees of acidity, four categories of virgin olive oil: extra, fine, ordinary and lampante. Lampante virgin olive oil is defined as follows: "off-flavour olive oil or olive oil with a free fatty acid content expressed as oleic acid of more than 3.3 g per 100 g." 13 For its part, paragraph 1 and the first subparagraph of paragraph 2 of Article 3 of Regulation No 3472/85, cited above, provide that the intervention buying-in price "shall be that valid on the day of delivery, ... allowance being made for the price increases and reductions provided for in this regulation. The buying-in price shall be adjusted by applying to the intervention price such increases and reductions as are specified in the annex". 14 As far as lampante virgin olive oil is concerned, the annex to Regulation No 3472/85 provides for a price reduction of ECU 8.14 for oil of 1o acidity; that reduction is to be increased by ECU 0.32 or 0.35 for each additional tenth of a degree of acidity, depending on whether the acidity of the oil in question is up to or over 8o. 15 That is the legislative background against which Section VIII of Annex II to Regulation No 3247/81, cited above, as amended, has to be interpreted. Section VIII provides that "For the purposes of applying the provisions dealing with discrepancies in quantities due to theft or loss attributable to identifiable causes, the intervention price for the relevant quality of oil shall be used, increased by all the monthly increments". 16 The Italian Government and the Commission take the view that the word "quality" in that provision refers to the four types of oil (extra, fine, ordinary and lampante) mentioned in the annex to Regulation No 136/66, cited above, and that there is no need to draw any distinction within each of those types according to the degree of acidity of the oil in question. 17 That interpretation cannot be accepted. Even if the four types referred to in that provision are quality categories, it in no way follows that they are the only ones to which reference can be made in order to assess the quality of the oil within the meaning of Section VIII of Annex II to Regulation No 3247/81, cited above. 18 This view is borne out by the fact that the first subparagraph of Article 12(1) of Council Regulation (EEC) No 1562/78 of 29 June 1978 provides that the buying-in price of olive oil offered for intervention "shall be adjusted by means of a scale of price increases and reductions where the description or quality of the oil offered to the intervention agency does not correspond to that for which the intervention price was fixed" and by the fact that the annex to Regulation No 3472/85, cited above, provides, under the heading "Description and quality as defined in the Annex to Regulation 136/66/EEC", for the increases in the applicable price reduction to which reference has already been made. 19 Consequently, as far as lampante olive oil is concerned, the degree of acidity is a factor which determines the "relevant quality" of that type of olive oil for the purposes of the application of Section VIII of Annex II to Regulation No 3247/81, cited above. 20 It follows that the value of the quantities of lampante olive oil which are missing because they were stolen has to be determined by multiplying the quantities stolen by the buying-in price ° applicable in the marketing year in which the theft was carried out or noticed, increased by all the monthly increments ° for the type of oil in question having a degree of acidity corresponding to that of the quantities stolen. 21 The Court adds that the precise determination of the degree of acidity of the consignments which were stolen in the instant case is a question of fact which is for the national court to determine. 22 However, in accordance with the principle that, in the matter of the clearance of European Agricultural Guidance and Guarantee Fund accounts, the burden of proof is to be discharged by the person who claims to be entitled to funding (see, most recently, the judgment in Case C-335/87 Hellenic Republic v Commission [1990] ECR I-2875 (summary publication only)), if there is no evidence enabling the degree of acidity of the stolen oil to be established, its value will have to be calculated by applying the buying-in price corresponding to the lowest degree of acidity of the oil stored during the marketing year in question in the warehouse in which the theft took place. 23 The answer to be given to the national court must therefore be that the fourth subparagraph of Article 3(2) of Council Regulation No 3247/81 of 9 November 1981 and Section VIII of Annex II to that regulation, as amended by Council Regulation No 2632/85 of 16 September 1985, is to be interpreted as meaning that, for the purposes of drawing up the annual accounts on the financing of intervention measures in the form of storage by the European Agricultural Guidance and Guarantee Fund, Guarantee Section, the value of the quantities of lampante virgin olive oil which are missing because they were stolen must be determined by multiplying the quantities stolen by the buying-in price ° applicable in the marketing year in which the theft was carried out or noticed, increased by all the monthly increments ° for a type of oil with a degree of acidity corresponding to that of the quantities stolen or, if there is no evidence enabling the degree of acidity of the stolen oil to be established, by applying to that oil the buying-in price corresponding to the lowest degree of acidity of the oil stored during the marketing year in question in the warehouse in which the theft took place. Costs 24 The costs incurred by the Italian Government and the Commission of the European Communities, which have 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. On those grounds, THE COURT (Fourth Chamber), in answer to the question referred to it by the Corte d' Appello, Rome, by order of 11 December 1990, hereby rules: The fourth subparagraph of Article 3(2) of Council Regulation (EEC) No 3247/81 of 9 November 1981 on the financing by the European Agricultural Guidance and Guarantee Fund, Guarantee Section, of certain intervention measures, particularly those involving the buying-in, storage and sale of agricultural products by intervention agencies, and Section VIII of Annex II to that regulation, as amended by Council Regulation (EEC) No 2632/85 of 16 September 1985, is to be interpreted as meaning that, for the purposes of drawing up the annual accounts on the financing of intervention measures in the form of storage by the European Agricultural Guidance and Guarantee Fund, Guarantee Section, the value of the quantities of lampante virgin olive oil which are missing because they were stolen must be determined by multiplying the quantities stolen by the buying-in price ° applicable in the marketing year in which the theft was carried out or noticed, increased by all the monthly increments ° for a type of oil with a degree of acidity corresponding to that of the quantities stolen or, if there is no evidence enabling the degree of acidity of the stolen oil to be established, by applying to that oil the buying-in price corresponding to the lowest degree of acidity of the oil stored during the marketing year in question in the warehouse in which the theft took place. © European Communities, 2001 All rights reserved BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII