Sociedade AgrC-Pecuaria Vicente Nobre Lda v Council of the EC. [1988] EUECJ C-253/86 (31 May 1988)

Judgment 1 By an application lodged at the Court Registry on 1 October 1986, Sociedade Agro-Pecuária Vicente Nobre, Lda ., of Rio Maior, Portugal, brought an action under the second paragraph of Article 173 of the EEC Treaty for a declaration that Article 6 ( 6 ) of Council Regulation ( EEC ) No 2239/86 of 14 July 1986 on a specific common measure to improve vine-growing structures in Portugal ( Official Journal 1986, L 196, p . 1 ) is void and, in the alternative, for compensation for the damage suffered by reason of the failure to apply Council Regulation ( EEC ) No 777/85 of 26 March 1985 on the granting, for the 1985/86 to 1989/90 wine years, of permanent abandonment premiums in respect of certain areas under vines ( Official Journal 1985, L 88, p . 8 ). 2 On 20 June 1986 the applicant, which is the owner of a vineyard in Portugal, submitted to the Portuguese State Secretary for Agricultural Development and to the Portuguese Minister for Agriculture, Fisheries and Food two identical applications for the grant of premiums for the permanent abandonment of vine-growing . Both those applications were accompanied by applications relating to the classification of the area under vines in question . By an amending statement of 8 July 1986, the applicant informed the same authorities that the applications were submitted under Council Regulation No 777/85, cited above . 3 By a letter of 31 July 1986, the State Secretary for Agricultural Development refused the applications and informed the applicant that Regulation No 777/85 was not applicable to Portugal by reason of Council Regulation No 2239/86 of 14 July 1986 on a specific common measure to improve vine-growing structures in Portugal . 4 Article 1 ( 1 ) of Regulation No 777/85 provides that "Vine growers cultivating areas under vines ... shall, upon application and subject to the conditions laid down in this regulation, qualify during the wine years 1985/1986 to 1989/90 for a premium for the permanent abandonment of vine growing ...". Article 3 of that regulation lays down a number of circumstances in which the permanent abandonment premium shall not be granted . 5 Regulation No 2239/86, which entered into force on 21 July 1986, provides for a number of restructuring operations, including the grubbing-up of vines, coupled with a system of aid . Under Article 6 ( 1 ), vine-growers cultivating areas under vines as referred to in the Regulation "shall qualify, on application, for a premium for the permanent abandonment of vine-growing ". Article 6 ( 6 ) provides that "for the duration of the common measure, vine-growers may not qualify for the permanent abandonment premium provided for in Regulation ( EEC ) No 777/85 ". 6 The applicant claims that the rules on premiums for the permanent abandonment of vine-growing laid down by Regulation No 2239/86 are in several respects less favourable than those laid down by Regulation No 777/85 . It considers that Regulation No 2239/86 not only fails to ensure that the premium will be granted to any person who had submitted an application before it entered into force, but also fails to guarantee the amount to which such a person would have been entitled under Regulation No 777/85 . 7 The applicant maintains that Article 6 ( 6 ) of Regulation No 2239/86 infringes a number of general principles of Community law, that is to say the principles of legal certainty, respect for vested rights, non-retroactivity of laws and protection of legitimate expectations . 8 The Council, and the Portuguese Republic and the Commission, intervening in support of the Council, claim that the action is inadmissible inasmuch as the conditions laid down in the second paragraph of Article 173 of the EEC Treaty for the admissibility of an action brought by a natural or legal person for the annulment of a regulation are not fulfilled in this case . The regulation in question, they say, is not of direct and individual concern to the applicant inasmuch as the applications for the grant of aid could not have had any legal effect before the 1986/87 wine year began on 1 September 1986 . 9 The Council and the interveners consider that the claim for damages is also inadmissible in so far as the applicant did not comply with the requirements of Article 38 ( 1 ) ( c ) of the Rules of Procedure . They consider that the application does not contain any basis for establishing the existence of any damage . 10 Reference is made to the Report for the Hearing for a fuller account of the facts of the case and the submissions and arguments of the parties, which are mentioned hereinafter only in so far as is necessary for the reasoning of the Court . The application for annulment 11 Under the second paragraph of Article 173 of the EEC Treaty, a natural or legal person may institute proceedings against a decision addressed to that person or against a decision which, although in the form of a regulation or a decision addressed to another person, is of direct and individual concern to the former . 12 In the present case, it should be observed that Regulation No 2239/86 is of general application inasmuch as it applies in abstract terms to a category of businesses with a view to achieving a general improvement of vine-growing structures in Portugal having regard to a number of objective criteria . 13 As regards the question of whether Article 6 ( 6 ) of Regulation No 2239/86 is of individual concern to the applicant, it should first of all be remembered that, as the Court has consistently held, and most recently in its judgment of 24 February 1987 in Case 26/86 Deutz und Geldermann v Council (( 1987 )) ECR 941, in order for a measure to be of individual concern to persons other than those to whom it is addressed, it must affect their legal position because of a factual situation which differentiates them individually in the same way as a person to whom it is addressed . 14 The applicant maintains that it is in such a situation because it had submitted applications for aid under Regulation No 777/85 . That view must be rejected since, without there being any need to decide whether an application submitted within the period laid down by the relevant provision can differentiate a vine-grower individually, it is sufficient to point out that the fact that the applicant submitted on 20 June 1986 two applications for the grant of premiums for the permanent abandonment of vine-growing is not such as to differentiate it individually from the other vine-growers affected by the regulation in question . That cannot be the case for an application submitted, as here, prematurely . 15 In view of all the foregoing considerations, the action for annulment must be declared inadmissible . The application for damages 16 Regarding the admissibility of the application for damages, it should first be observed, as the Court stated in its judgment in Case 175/84 Krohn v Commission (( 1986 )) ECR 753, that the application for compensation provided for by Article 178 and the second paragraph of Article 215 of the Treaty was introduced as an autonomous form of action with a particular purpose to fulfil within the system of actions and subject to conditions on its use dictated by its specific nature . 17 The defendant and the interveners claim that the application for compensation is inadmissible on the ground that the applicant did not comply with the requirements of Article 38 ( 1 ) ( c ) of the Rules of Procedure . They consider that the application does not contain any basis for establishing that any damage was suffered by the applicant . 18 That argument cannot be accepted . It must be observed that it is apparent from the explanations given by the applicant that the subject-matter of the application for compensation refers to the premium for the abandonment of vine-growing under Regulation No 777/85 which, in its view, it should have been granted . 19 With regard to the merits of this application, it should be borne in mind that the Court has held in previous decisions that by virtue of the second paragraph of Article 215 of the Treaty, the liability of the Community presupposes the existence of a set of circumstances comprising the unlawfulness of the conduct alleged against the institutions, actual damage and the existence of a causal link between the conduct and the alleged damage ( see in particular the judgment in Case 281/84 Zuckerfabrik Bedburg and Others v Council and Commission (( 1987 )) ECR 49 ). In that judgment, the Court stressed that, where a legislative measure is concerned, the unlawfulness of the conduct must constitute a sufficiently serious breach of a superior rule of law for the protection of the individual . 20 The applicant claims that in the present case the principles of respect for vested rights, protection of legitimate expectations, legal certainty and non-retroactivity of laws have been infringed . 21 As regards the respect of vested rights, it has already been pointed out that the applicant submitted its applications prematurely . It follows that in such circumstances no vested right capable of being infringed can have been created in the applicant' s favour . 22 With regard to the principle of legitimate expectations, it should be noted not only that Protocol No 24 to the Act of Accession on agricultural structures in Portugal ( Official Journal 1985, L 302, p . 464 ) provides that the conditions for eligibility for Community financing must be adapted to the specific features of the situation in Portugal, but also that under Article 7 of Regulation No 777/85 the Council may decide to alter the amount of the premium . The applicant can therefore have had no legitimate expectations with regard to the grant of premiums . 23 Nor is it possible, in view of that fact that Regulation No 2239/86 was applicable only as from the 1986/87 wine year, to consider that there has been an infringement of the principles of legal certainty and non-retroactivity of laws . 24 The application for compensation is therefore unfounded . 25 The action must consequently be dismissed in its entirety . Costs 26 Under Article 69 ( 2 ) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs . Since the applicant has been unsuccessful, it must be ordered to pay the costs, including those of the interveners . On those grounds, THE COURT ( Sixth Chamber ) hereby : ( 1 ) Dismisses the application; ( 2 ) Orders the applicant to pay the costs, including those incurred by the interveners . © European Communities, 2001 All rights reserved BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII