JUDGMENT OF 14. 7. 1983 — CASE 224/82

treatment as regards processors of contracts at a relatively early date and sweet cherries, who, as a result of the having forwarded them relatively regulation, only received aid by the swiftly. accident of having concluded their

In Case 224/82

REFERENCE to the Court under Article 177 of the EEC Treaty by the Verwaltungsgericht [Administrative Court] am Main for a preliminary ruling in the action before that court between

MEIKO-KONSERVENFABRIK, Gergweis,

and

FEDERAL REPUBLIC OF GERMANY, represented by the Bundesamt für Ernährung und Forstwirtschaft [Federal Office for Food and Forestry], Frankfurt am Main, on the validity of Commission Regulation (EEC) No 2546/80 of 2 amending for the eleventh time Regulation (EEC) No 1530/78 laying down rules for the application of the system of aid in respect of certain products processed from fruit and vegetables (Official Journal 1980, L 260, p. 14),

THE COURT (Third Chamber) composed of: U. Everling, President of Chamber, Y. Galmot and C. Kakouris, Judges,

Advocate General: S. Rozès Registrar: J. A. Pompe, Deputy Registrar gives the following

2540 MEIKO-KONSERVENFABRIK v GERMANY

JUDGMENT

Facts and Issues

The facts of the case, the course of the deliveries to processors and the price to procedure and the written observations be paid to producers". submitted under Article 20 of the Protocol on the Statute of the Court of Justice of the European Economic Com­ The effect of the last sentence of Article munity may be summarized as follows: 3a (2) read together with Article 3b (5) and (6) is that the aid, fixed before the beginning of each marketing year, is paid on application to processors as soon as the competent agencies of the Member I — Facts and written procedure States concerned, to which the contract has been forwarded, have carried out the checks relating to their performance. The Community regulations applicable The rules for the application of the system of aid were laid down by the Council Regulation (EEC) No 516/77 of Commission in Regulation (EEC) No 14 March 1977 on the common organ­ 1530/78 of 30 June 1978 (Official ization of the market in products Journal 1978, L 179, p. 21). That regu­ processed from fruit and vegetables lation was amended by Commission (Official Journal 1977, L 73, p. 1) Regulations (EEC) No 1348/80 of 30 introduced a system of production aid (Official Journal 1980, L 135, for the products set out in Annex la, p. 66), No 1964/80 of 24 which was inserted in that regulation by (Official Journal 1980, L 191, p. 17) and Council Regulation (EEC) No 1152/78 No 2546/80 of 2 October 1980 (Official of 30 May 1978 (Official Journal 1978, Journal 1980, L 260, p. 14). L 144, p. 1). Council Regulation (EEC) No 1639/79 of 24 extended the system of production aid to cherries The effect of those regulations is that the preserved in syrup with effect from the processor cannot claim payment of the beginning of the 1980/81 marketing year aid unless the contracts and supplemen­ (Official Journal 1979, L 192, p. 3). tary agreements have been signed and forwarded to the competent national agencies within the periods laid down by According to Article 3b (4) of Council the Commission. Regulation No 516/77, as amended by Regulation No 1152/78, "production aid According to Anicie 1 of Regulation No shall be granted to processors who have 1530/78, as amended by Regulation concluded contracts in accordance with No 1348/80, contracts relating to the Article 3a". According to Article 3a (2), processing of hard-fleshed heart cherries "these contracts, concluded for a and sweet cherries and any supplemen­ minimum period to be determined, must tary agreements had to be concluded by specify the quantities of raw material to 10 and 30 July 1980 respectively. Owing which they relate, the schedule for to the delay in harvesting the cherry crop

2541 JUDGMENT OF 14. 7. 1983 — CASE 224/82 in 1980 due to difficult weather terioration due to the conditions in conditions the contracts and sup­ which it was harvested, Meiko plementary agreements could not be immediately processed it. signed in time. By Regulation No Relying on Articles 3a and 3b of Council 1964/80 of 24 July the Commission Regulation No 516/77 of 14 March therefore extended the periods for the 1977, as amended by Regulation No signing of contracts and amendments 1152/78 of 30 May 1978, Meiko applied thereto until 31 July and 15 to the Bundesamt für Ernährung und respectively. Forstwirtschaft for payment of a production aid for 1980 in respect of According to Article 2 of Regulation No 17 785 kg of sweet cherries to be 1530/78, a copy of the contract and of preserved in syrup. any endorsement thereof had to be Owing to the delay in the forwarding forwarded before the date "on which of the contracts and supplementary they [were] to take effect", that is to say agreements, which were notified to the before the first delivery of raw materials, Bundesamt on 7 and 19 August 1980 to the national agency responsible for respectively, the Bundesamt, acting administering the system of aid and pursuant to Article 1 of Regulation No inspecting the raw materials before per­ 2546/80, refused the application for formance of the contract. production aid by a decision of 6 , which it confirmed in On account of the difficulties mentioned its reply to an objection lodged by above contracts concluded late had to be Meiko. performed immediately, as the quality of the "fruit was likely to deteriorate. In view óf that refusal Meiko brought an Because of these special circumstances action against the Federal Republic of Article 2 of Regulation Nó 1530/78 was Germany, represented by the Bundesamt supplemented on 2 October 1980 by für Ernährung und Forstwirtschaft Regulation No 2546/80, which provides before the Verwaltungsgericht Frankfurt that: am Main, which, by order of 3 August 1980, decided to stay the proceedings in order to ask the Court of Justice for a "However, for the .1980/81 marketing preliminary ruling on the following year, contracts concluded for cherries question: may be forwarded, even after the date on which they take effect, to the said "Does Article 1 of Commission Regu­ agency not later than 31 July 1980." lation (EEC) No 2546/80 of 2 October 1980 (Official Journal 1980, L 260, 3. 10. 1980, p. 14) offend against the principles of proportionality and equal Facts and procedure treatment in retroactively fixing a time- limit, namely 31 July 1980, by which the concluded contracts had to be forwarded Meiko-Konservenfabrik, whose main to the appropriate agency?" business is the processing of fruit into preserves, entered into supply contracts According to the reasons set out in the with cherry growers on 21 July 1980. An order for reference, the German court, addendum to those contracts was signed which refers to certain judgments of the on 31 July 1980. Court of Justice concerning the principles of porportionality and equal The fruit was delivered during the period treatment, considers that in retroactively 23 July to 31 July 1980. Fearing de­ fixing 31 July as the time-limit for the

2542 MEIKO-KONSERVENFABRIK v GERMANY

forwarding of contracis Regulation No "By Regulation No 2546/80 of 2 2546/80 of 2 October 1980 is an October 1980 (Official Journal 1980, L arbitrary measure which for no objective 260, p. 14) the Commission fixed 31 July reason puts a specific group of under­ 1980 as the time-limit for forwarding takings, including Meiko, at a disad­ contracts for the processing of cherries vantage compared with competitors who, to the competent national agencies. In its having processed the goods immediately written observations submitted to the after their delivery, forwarded their Court the Commission stated that, since contracts, quite by chance, before 31 the provision was an exceptional one July 1980. requested by the Member States, it had to rely primarily on the information provided by them on the actual situation The German court also considers that in in their countries in order to fix an operating automatically the provision objectively reasonable date. 31 July was is contrary to the principle of pro­ the date proposed by the Federal portionality inasmuch as it does not Republic of Germany to resolve the allow the penalty of being refused aid to problem (written observations, p. 5). be related to action attributable to Meiko. The Government of the Federal Republic The order for reference was registered at of Germany is requested to give a the Court on 23 August' 1982; written reply to the follwing questions by 4 March 1983:

In accordance with Article 20 of the Protocol on the Statute of the Court of 1. Why did the Federal Republic of Justice of the European Communities, Germany propose that 31 July 1980 written observations were lodged by the should be fixed as the time-limit for Commission of the European forwarding contracts for the pro­ Communities, represented by Jörn Sack cessing of cherries to the Bundesamt and Christine Berardis-Kayser, both members of its Legal Department, acting für Ernährung und Forstwirtschaft? as Agents. By letters dated 29 September 1982 and 5 October 1982 the Bundesamt für Ernährung und Forstwirtschaft and 2. Are there other German undertakings the German Government informed the which, like Meiko-Konservenfabrik, Court that they would not be lodging did not forward processing contracts written observations. in time and are therefore in the same position as that undertaking?"

Upon hearing the report of the Judge- Rapporteur and the views of the Advocate General the Court decided, in In the same letter the Registrar requested accordance with Article 21 of the Statute the German Government, in accordance and Article 45 of the Rules of Procedure, with the wishes of the Court, to be to undertake measures of inquiry. represented by an agent or to send an expert to the hearing fixed for 21 April 1983. By a letter dated 10 February 1983 the Registrar of the Court wrote to the Government of the Federal Republic of The German Government lodged its Germany as follows : observations on 3 March 1983. By a

2543 JUDGMENT OF 14. 7. 1983 — CASE 224/82 letter dated 4 March 1983 it informed any error of judgment on its part the Court that Ulrich Maass, Oberregie- because, since it was an exceptional rule rungsrat at the German Ministry of requested by the Member States con­ Food, Agriculture and Forestry would be cerned, including the Federal Republic of present at the hearing on 21 April 1983. Germany, which was particularly Mr Maass would if necessary be assisted affected by the difficulties encountered by a representative of the Bundesamt für in 1980, it could not fix an objectively Ernährung und Forstwirtschaft. reasonable date except in the light of information provided by the Member States on the actual situation in their own contries. As Germany had itself By order of 2 February 1983 the Court asked that processing contracts and sup­ decided to assign the case to the Third plementary agreements should be Chamber in accordance with Article 95 allowed, after taking effect, to be (1) and (2) of the Rules of Procedure. forwarded to the national agencies until 31 July 1980, the Commission considers that there was no reason, at least in this case, to extend the time-limit proposed.

II — Summary of the written observations submitted to the Court by the Com­ The Commission further considers that mission of the European an incomplete description of the facts by Communities the Member States concerned should not necessarily render a Community regu­ lation invalid. The Commission here emphasizes that, according to a telex The Commission believes that the validity message (attached to the written obser­ of Regulation No 2546/80 cannot be vations) which the German Ministry of called in question on the basis of the Food sent to it as one of the proposals to principles of proportionality and equal amend Regulation No 1530/78, the treatment. Bundesamt "had in any case been acquainted with the undertakings in question for a long time". Also the fact As regards the alleged infringement of that a few applicants were not taken into the principle of proportionality, the consideration by the national authorities Commission observes that, in retro­ and their cases were not notified to the actively fixing 31 July as the time-limit Commission cannot, in the Commission's by which processing contracts which had opinion, be considered to be a breach by already taken effect had to be forwarded the contested regulation of the principle to the competent national agency, Regu­ of proportionality. lation No 2546/80 of 2 October 1980 enabled a large number of undertakings to receive aid which they would not have obtained under the rule in Article 2 of As to the principle of equal treatment, Regulation No 1530/78 in force at the the Commission maintains that, in so far time of the conclusion of those contracts. as at the time when the processing contracts were signed Regulation No 1530/78, supplemented by Regulation The Commission considers that the No 1964/80, was in force, it was entitled concession thus granted does not involve to assume that, even if processing under-

2544 MEIKO-KONSERVENFABRIK v GERMANY

takings were unable to comply with the time in the 1980/81 marketing year and provisions requiring contracts to be therefore there were no precedents for forwarded before they took effect, they the drafting of contracts. In proposing would forward them by 31 July 1980 in the date of 31 July 1980 the German order to comply as far as possible with Government considered it appropriate the provisions in force. for two reasons :

The fact that applicants who sent in their contracts before the final date are in a First, that date coincided with the time- better position than those whose limit for the signing of processing contracts were received after that date is contracts laid down by Commission an inevitable consequence of any legis­ Regulation No 1964/80 of 24 July 1980. lation laying down general criteria.

Secondly, the German Government The Commission suggests that the Court thought that the undertakings concerned should give the following answer to the would thus have sufficient time to question asked by the Verwaltungs­ become familiar with the new rules and gericht Frankfurt am Main : to make all necessary arrangements.

"Consideration of the question raised has disclosed no factor of such a kind as The German Government adds that, as it to affect the validity of Commission only wanted a concession which was in Regulation (EEC) No 2546/80 of 2 keeping with the principle that contracts October 1980." must be forwarded to the competent agency before they take effect, it thought it necessary to choose an appropriate date without offending against the principle laid down by Article 2 of Commission Regulation No 1530/78. Ill — Observations of the German Government sub­ mitted in reply to the questions asked by the The German Government replies in the Court affirmative to the question whether other German undertakings are in the same situation as Meiko. In reply to the question why the Federal Republic of Germany proposed that 31 July 1980 be fixed as the time-limit for The German Government states that of forwarding contracts for the processing the 207 contracts forwarded to the of cherries to the Bundesamt für Bundesamt für Ernährung und Forst­ Ernährung und Forstwirtschaft, the wirtschaft after they had begun to be German Government first of all points performed only 169 benefited from the out that the delay in 1980 in the concession granted by the Commission in forwarding of contracts was mainly due Regulation No 2546/80 of 2 October to the fact that the Community regu­ 1980. Production aid was therefore lations on production aids for cherries refused in respect of the 38 processing were applied in Germany for the first contracts forwarded after 31 July 1980.

2545 JUDGMENT OF 14. 7. 1983 — CASE 224/82

IV — Oral procedure European Communities, represented by Christine Berardis-Kayser, acting as Agent, presented oral argument at the The German Government, represented sitting on 21 April 1983. by Ulrich Maass, Oberregierungsrat at the Federal Ministry of Food, Agri­ culture and Forestry, appearing as an The Advocate General delivered her expert, and the Commission of the opinion at the sitting on 9 June 1983.

Decision

1 By an order dated 3 August 1982, which was received at the Court on 23 August 1982, the Verwaltungsgericht [Administrative Court] Frankfurt am Main referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question on the validity of Commission Regulation (EEC) No 2546/80 of 2 October 1980 (Official Journal 1980, L 260, p. 14) amending for the eleventh time Commission Regulation (EEC) No 1530/78 of 30 June 1978 laying down rules for the application of the system of aid in respect of certain products processed from fruit and vegetables (Official Journal 1978, L 179, p. 21).

2 That question was raised in the course of litigation in which Meiko- Konservenfabrik challenged the decision whereby the Bundesamt für Ernährung und Forstwirtschaft [Federal Office for Food and Forestry], Frankfurt am Main, had refused, on the basis of the aforementioned Regu­ lation No 2546/80, to pay it the aid for which it applied in respect of the processing of sweet cherries intended for preservation in syrup.

3 The system of aid in question was introduced by Council Regulation (EEC) No 516/77 of 14 March 1977 on the common organization of the market in products processed from fruit and vegetables (Official Journal 1977, L 73, p 1) in respect of the products set out in Annex la thereof, as amended and extended by Council Regulations Nos 1152/78 of 30 May 1978 (Official Journal 1978, L 144, p. 1) and 1639/79 of 24 July 1979 (Official Journal 1979, L 192, p. 3).

4 It follows from Article 3a of Council Regulation No 516/77 and from the first and second recitals in the preamble to Council Regulation No 1152/78 that the system of aid for the production of processed fruit and vegetables

2546 MEIKO-KONSERVENFABRIK v GERMANY

was introduced in order to make such Community products more competitive with those of non-member countries where the producer price was considerably lower. That system of aid was based on a system of contracts which, on the one hand, were binding on the Community producers and processors of fruit and vegetables and, on the other hand, ensured both the regular supply of the processing industries and a minimum price to be paid by the processors to the producers. Council Regulation No 1639/79 extended the system of aid to hard-fleshed heart cherries and other sweet cherries with effect from the 1980/81 marketing year.

s In accordance with Articles 3c and 20 of Council Regulation No 516/77, detailed rules for the application of that system were laid down by Commission Regulation (EEC) No 1530/78 of 30 June 1978, which was later amended by Commission Regulations (EEC) Nos 1348/80 of 30 May 1980 (Official Journal 1980, L 135, p. 66), 1964/80 of 24 July 1980 (Official Journal 1980, L 197, p. 17) and 2546/80 of 2 October 1980 (cited above).

6 As a result of those rules, a processor may not claim payment of the aid unless the contracts and any supplementary agreements thereto were concluded within the time-limits laid down by the Commission. By virtue of Regulation No 1348/80 of 30 May 1980 the time-limit for the conclusion of contracts for the 1980/81 marketing year was 10 July 1980. However, as the harvest of hard-fleshed heart cherries and other sweet cherries was delayed in 1980, Regulation No 1964/80 of 24 July 1980 extended the time-limit to 31 July 1980.

7 Article 2 of Commission- Regulation No 1530/78 lays down a second requirement for the granting of aid by stating that a copy of the contracts must be forwarded "before the date on which they are to take effect", that is to say before the commencement of the first delivery of fruit, to the agency designated by the Member State in which processing is to take place to administer the system of aid and to inspect the fruit before performance of the contract.

8 The weather conditions for the harvest in 1980 apparently made it very difficult for processors to comply with the time-limit set by Article 2 of Regulation No 1530/78 for the forwarding of a copy of the contract. Recognizing those exceptional difficulties, the Commission, by Article 1 of

2547 JUDGMENT OF 14. 7. 1983 — CASE 224/82

Regulation No 2546/80 of 2 October 1980, added the following words to Article 2 of Regulation No 1530/78:

"However, for the 1980/81 marketing year, contracts concluded for cherries may be forwarded, even after the date on which they take effect, to the said agency not later than 31 July 1980."

9 On the basis of the latter provision and taking into account the fact that the contracts and supplementary agreements concluded by Meiko on 21 and 31 July 1980 were forwarded on 7 and 19 August 1980 respectively, the Bundesamt für Ernährung and Forstwirtschaft rejected that company's application for aid.

io Meiko challenged that decision before the Verwaltungsgericht Frankfurt am Main, which referred the following question to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty:

"Does Article 1 of Commission Regulation (EEC) No 2546/80 of 2 October 1980 (Official Journal 1980, L 260, 3. 10. 1980, p. 14) offend against the principles of proportionality and equal treatment in retroactively fixing a time-limit, namely 31 July 1980, by which the concluded contracts had to be forwarded to the appropriate agency?"

11 It follows from the wording used by the national court that the question on which a preliminary ruling is sought relates in essence to the validity of Article 1 of Regulation No 2546/80 of 2 October 1980 in the light of the general principles of law the observance of which is ensured by the Court of Justice.

i2 As the Court stated in its judgments of 25 in Case 98/78 (Racke v Hauptzollamt Mainz [1979] ECR 69) and Case 99/78 (Decker v Hauptzollamt Landau [1979] ECR 101), as a general rule it is contrary to the principle of legal certainty for a Community measure to specify a date prior to its publication as the date on which it is to take effect. It may exceptionally be otherwise where the purpose to be achieved so demands and where the legitimate expectations of those concerned are duly respected.

2548 MEIKO-KONSERVENFABRIK v GERMANY

i3 In order to determine whether the principle of the protection of legitimate expectation has been complied with it is necessary to examine the situation which Regulation No 2546/80 was intended to correct in the light of the rules which were in force at the time. It must be recalled in that respect that at the time the persons concerned concluded the contracts the receipt of aid was subject to the two requirements laid down by Regulation No 1530/78 of 30 June 1978 and Regulation No 1964/80 of 24 July 1980, that is to say the conclusion of the contract by 31 July 1980 and the forwarding of a copy of it to the responsible national agency before the contract took effect. It must be recognized that processors who waited, as they were legally entitled to do, until the time-limit of 31 July 1980 to conclude their contracts could not have forwarded the documents on the same day in accordance with the new requirement laid down by Regulation No 2546/80 of 2 October 1980.

14 It must also be recognized that by retroactively subjecting the payment of aid to the forwarding of the contracts by 31 July 1980 the Commission acted in breach of the legitimate expectations of the persons concerned, who, having regard to the provisions in force at the time the contracts were concluded, could not reasonably have anticipated the retroactive imposition of a time- limit for forwarding the contracts which coincided with the time-limit for their conclusion.

is It must be stated, furthermore, that the Commission was also in breach of the principle of equal treatment as regards processors of hard-fleshed heart cherries and other sweet cherries, who, as a result of Regulation No 2546/80, only received aid by the accident of having concluded their contracts at a relatively early date and having forwarded them relatively swiftly. In fact, it is clear from the documents submitted to the Court that 207 contracts were forwarded to the Bundesamt für Ernährung und Forst­ wirtschaft and that aid could not be granted in respect of 38 because they had not been forwarded by 31 July 1980.

i6 It is true, as the Commission contended before the Court, that the contested regulation enabled a large number of undertakings to receive aid which they could not have obtained under the system which was established by Article 2 of Regulation No 1530/78 and which was in force at the time the contracts

2549 JUDGMENT OF 14. 7. 1983 — CASE 224/82

were concluded. It is also true that the Commission was under no obligation to alter the provisions of Regulation No 1530/78 retroactively. i7 Nevertheless, once the Commission had agreed to take into account the processors' difficulties and to correct the effects thereof, it was under a duty, in adopting the appropriate measures, to have regard to the legitimate expectations of the persons concerned and to ensure that they were accorded equal treatment. is In that respect the Commission contends that in adopting the contested regu­ lation it took into account the views expressed in that connection by the Member States and that inasmuch as it was a question of adopting an exceptional provision, sought in particular by the Federal Republic of Germany, there was no objective reason to provide longer time-limits than those proposed by the German authorities themselves. i9 Whilst it is true that the attitude adopted by the German authorities contributed to the situation from which the dispute arose, inasmuch as it would appear that they proposed the time-limit of 31 July 1980 without having made a thorough study of the applications pending, that circumstance cannot, by itself, prove the validity of Regulation No 2546/80. In fact, the Commission was under a duty to check that the date suggested by the German authorities was compatible with the regulation which it had, itself, previously adopted.

20 In view of the foregoing, the reply to the question raised by the Verwaltungs­ gericht Frankfurt am Main must be that Article 1 of Commission Regulation No 3546/80 of 2 October 1980 as invalid inasmuch as it fixed 31 July 1980 as the final date for forwarding concluded contracts to the competent national agency.

Costs

2i The costs incurred by the Commission, which submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties tö 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.

2550 MEIKO-KONSERVENFABRIK v GERMANY

On those grounds,

THE COURT (Third Chamber),

in answer to the question submitted to it by the Verwaltungsgericht Frankfurt am Main, by order of 3 August 1982, hereby rules:

Article 1 of Commission Regulation (EEC) No 2546/80 of 2 October 1980 is invalid inasmuch as it fixed 31 July 1980 as the final date for forwarding concluded contracts to the competent national agency.

Everling Galmot Kakouris

Delivered in open court in Luxembourg on 14 July 1983.

For the Registrar H. A. Rühi U. Everling Principal Administrator President of the Third Chamber

OPINION OF MRS ADVOCATE GENERAL ROZÈS DELIVERED ON 9 JUNE 1983 '

Mr President, 2546/80 of 2 October 1980 amending Members of the Court, for the eleventh time Regulation (EEC) No 1530/78 laying down rules for the application of the system of aid in A reference has been made to the Court respect of certain products processed for a preliminary ruling on the validity from fruit and vegetables. That reference of Commission Regulation (EEC) No to the Court has been made by the First

1 — Translated from the French.

2551