JUDGMENT OF 17.5.1972 — CASE 93/71

following the establishment of the require payment of the subsidy without proof of slaughter as provided in that Member State's being able to rely Article 10 of Regulation No 2195/69. on arguments based on any legislative As from that time, the abovementioned provisions or administrative practices to regulations give the farmer the right to withhold such payment.

In Case 93/71

Reference to the Court under Article 177 of the EEC Treaty by the Pretore di Lonato for a preliminary ruling in the action pending before that court between

ORSOLINA LEONESIO, a farmer of Monica (province of Brescia, Italy),

and

Ministry for Agriculture and Forestry of the Italian Republic, on the interpretation

— of Articles 1 to 4 of Regulation (EEC) No 1975/69 of the Council of 6 establishing a system of subsidies particularly for slaughtering cows (JO L 252, p. 1);

— of Articles 3 to 11 of Regulation (EEC) No 2195/69 of the Commission of 4 adopting detailed rules for the application of that system (JO L 278, p. 6),

THE COURT composed of: R. Lecourt, President, J. Mertens de Wilmars and H. Kutscher (Rapporteur), Presidents of Chambers, A. M. Donner, A. Trabucchi, R. Monaco and P. Pescatore, Judges,

Advocate-General: K. Roemer Registrar: A. Van Houtte gives the following

288 LEONESIO v ITALIAN MINISTRY FOR AGRICULTURE AND FORESTRY

JUDGMENT

Issues of fact and of law

I — Facts and procedure Article 19 provides that the Member States shall be authorized within the limits set out The facts and procedure may be sum­ in that article to impose additional condi­ marized as follows: tions for the grant of the subsidy. 1. A. In accordance with its basic Regula­ tion No 805/68 of 27 on the 2. By a circular of 23 the common organization of the market in Italian Ministry for Agriculture and beef and veal (OJ English Special Edition Forestry gave to the regional authorities 1968(1), p. 187) the Council adopted on instructions relating to the rules for the 6 October 1969 Regulation No 1975/69, application of the said regulations, whilst Article 1 of which provides that 'Farmers stating that the actual implementation of having at least two milk cows may, on those regulations was subject to the adop­ application, receive a subsidy for slaughter­ tion of the necessary budgetary provisions and the administration could, in the mean­ ing on the conditions specified below', that is to say in Articles 2 to 4 of the same time, only issue 'provisional authorization' regulation. to slaughter. Under Article 9 the detailed rules for the In 1970 Mrs Leonesio, a farmer, slaugh­ tered five milk cows and sought from the application of the abovementioned article were to be established 'in accordance competent authorities of the province of with the procedure provided for in Article Brescia the grant of a subsidy of Lit. 625 000. In accordance with the above­ 27 of Regulation (EEC) No 805/68', that mentioned circular this subsidy was is to say, by the Commission acting on the opinion of the Management Committee. granted to her by way of a 'provisional Article 10 provides that 'The Member authorization' issued on 22 , States may be authorized, according to payment being subject 'to compliance with the technical conditions laid down' and the procedure laid down in Article 27 of Regulation (EEC) No 805/68, to impose 'the adoption by the Italian Parliament of additional conditions for the grant of the legislative provisions making the the subsidies necessary allocations'. Article 12(1) provides that 'The European At the beginning of November 1971, believing that she had complied with all Agricultural Guidance and Guarantee Fund, Guidance Section, shall reimburse the necessary conditions, Mrs Leonesio the Member States 50% of the subsidies'. brought an action before the Pretore, Lonato, under Articles 633 et seq. of the B. On 4 November 1969, the Commission, Italian Code of Civil Procedure for a on the basis of Regulation No 1975/69, decree of injunction ordering the Ministry adopted Regulation No 2195/69. for Agriculture and Forestry to pay the Articles 3 to 9 and 11 of that regulation subsidy. relate to the formalities to be completed both by the individual concerned and by 3. By an order of 3 November 1971, the the Community and the Member States Pretore di Lonato decided to ask the Court for slaughtering and payment of the of Justice: subsidy in each particular case. Article 10 provides that the payment of the '(a) Whether the provisions of Regulation subsidy 'shall take place within two months No 1975/69 and of Regulation No of the establishment of proof of the 2195/69 are directly applicable in the slaughtering in accordance with Article 9 Italian legal system and, if this ques­ of this regulation'. tion is answered in the affirmative,

289 JUDGMENT OF 17.5.1972 — CASE 93/71

whether they create individual rights Mrs Leonesio, the Italian Government and which national courts must protect ; the Commission presented oral argument at the hearing on 15 . (b) If the above question is answered in the Mrs Leonesio was represented by Cesare affirmative, whether, in view of the Trebeschi, Carlo Cappelli and Emilio provisions of Article 10 of Regulation Cappelli, of the Bar, the Italian No 2195/69, the provisions of Articles Government by Adolfo Maresca, Minister 1 to 4 of Regulation No 1975/69 and Plenipotentiary, assisted by Giorgio Zagari, of Articles 3 to 11 of Regulation No Deputy State Advocate-General and the 2195/69 must be interpreted as mean­ Commission by its Legal Adviser, Armando ing that they have created individual Toledano-Laredo. pecuniary rights immediately enforce­ The Advocate-General delivered his able against the State such that opinion at the hearing on 26 . national legislation can have no influ­ ence whatever as to the period for pay­ ment and whether consequently this II — Observations submitted in ac­ pecuniary right cannot be made cordance with Article 20 of subject to certain conditions but must the Protocol on the Statute of be afforded immediate protection by the Court of Justice of the the national court where: EEC

— in application of Article 5(1) of The observations submitted in accordance Regulation No 2195/69 it has been with Article 20 of the Protocol on the established that applications for the. Statute of the Court of Justice of the EEC grant of the slaughtering subsidy may be summarized as follows: may be allowed to proceed (this finding having been made in the Mrs Leonesio states that the provisions of prescribed manner on 26 January Regulations Nos 1975/69 and 2195/69 1970 by Regulation (EEC) No providing for the grant of slaughtering 140/70 of the Commission pub­ subsidies are of à 'legally perfect' nature lished in the JO L 20, of 27.1.1970, within the meaning of the decided cases P. 6); of the Court relating to the direct effect of Community provisions. Under Article 9 — the conditions set out in Articles of Regulation No 1975/69 the Commission 5(2) and 6 of Regulation No alone is competent to determine the detailed 2195/69 have been fulfilled; rules of application to be observed for the actual payment of the subsidy. Article 10 — the proof of slaughter of milk cows of that regulation prohibits the national mentioned in Article 9 of Regula­ authorities from imposing additional con­ tion. No 2195/69 has been pro­ ditions for the grant of subsidies without duced.' the prior authorization of the Commission. The Commission set out the detailed rules 4. The order making the reference was for application in rigid and comprehensive. received at the Court Registry on 17. terms and the national authorities were November 1971. Mrs Leonesi, the Govern­ only empowered to collect the applications ment of the Italian Republic and the Com­ and to verify certain facts. mission of. the European Communities In fact the Commission, not the Member submitted written observations in accor­ States, had a discretionary power in that dance with Article 20 of the Protocol on it was in a position to decide whether. the Statute of the Court of Justice. applications made should be allowed to Upon hearing the report of the Judge- proceed or not (Article 5(1) of Regulation Rapporteur and the views of the Advocate- No 2195/69). However, once this decision General, the Court decided to dispense had been taken, which was done by Regula­ with a preparatory inquiry. tion No 140/70, there remained no discré-

290.; LEONESIO v ITALIAN MINISTRY FOR AGRICULTURE AND FORESTRY tionary power with regard to its execution, in the 'Gazzetta Ufficiale' of the Italian which was to be carried out by the national Republic Law No 935 of 26 , authorities. Indeed the payment of the the implementation of which may satisfy subsidy which had to be carried out within the claims of the applicant, nevertheless, the period laid down in Article 10 of in accordance with the judgment of the Regulation No 2195/69 was only subject Court of 14 (Case 43/71 to the actual existence of milk cows, to Politi v Italian Ministry of Finance [1971] the undertaking to cease milk production ECR 1039) this alteration in the domestic and to proof of slaughter. The relevant law has no effect on the jurisdiction of the regulations do not provide that any Court to decide on the reference from the authorization may be granted by the Pretore di Lonato. Member State concerned. Finally therefore, in the applicant's view, In the final analysis the duty to pay the the first question of the Pretore di Lonato subsidy is enshrined in the Community should be answered in the affirmative. With legal order and therefore the intervention regard to the second question the Court of the national authorities should go no should rule that the provisions in question further than establishing the existence of create individual pecuniary rights against the fact giving rise to that duty. the State such that national legislation The action by a Member State of rendering can have no influence on the detailed rules the application of a regulation subject to for the application and the period for the the adoption of a national law is incom­ execution of the duty imposed on the patible with Article 189 of the Treaty. It State and that they give to individuals is true that there exists a theory in Italy entitled to subsidies the right to protection that pecuniary rights against the State from the detrimental effects which might are only enforceable after the allocation result from delay in compliance. of the necessary funds, irrespective of any The Italian Government states first that Law period which may be fixed for their pay­ No 935, mentioned above, authorized the ment; however, lest discrimination be payments due from the Italian State under introduced between nationals of different the regulations in question. Therefore the Member States such a theory cannot be main action has in fact lost its purpose. accepted with regard to financial obliga­ Those regulations did not have immediate tions at a Community level. Further, the effect to the benefit of individuals because Court has stated that 'The complexity of they required the adoption of implementing certain situations in a State cannot alter measures by the Member States, if only to the legal nature of a Community provision determine the bodies empowered to apply which is directly applicable, and this is them and to make the necessary funds particularly the case considering that the available to the administration. In partic­ Community rule must have the same bind­ ular, Article 81 of the Italian constitution ing force in all Member States', and that stipulates that any law providing for any the national courts' must 'protect the new payment must make provision for the interests of those persons subject to their financial means to undertake it; the same jurisdiction who may be affected by any also applies in respect of Community possible infringement of the said provi­ rules having the force of law in Italy. This sions, by ensuring for them direct and is moreover an automatic requirement. immediate protection of their interests no As to the second question from the Pretore matter what the existing relationship may di Lonato, it may be understood as being be under national law between those merely a paraphrase of the first question. interests and the public interest to which But it could also be interpreted as relating the question refers' (Judgment of 19 to the relationship between the Community December, 1968, Case 13/68 Salgoil v rule and national law as it uses the ex­ Italy, [1968] ECR 453 at pp. 462 and 463). pression 'immediately enforceable pecu­ Whilst it is true that on 22 November 1971, niary right' which is contained in Article that is, after the matter was referred to 633 of the Italian Code of Civil Procedure the Court of Justice, there was published providing for a 'decree of injunction'

291 JUDGMENT OF 17.5.1972 — CASE 93/71

('decreto ingiuntivo') in favour of the be relied on within the context of national person entitled to such a right. According budgetary legislation. Measures adopted to the Italian Government, this interpreta­ by the authorities of the Member States tion may be confirmed by a paragraph of to permit the satisfaction of those rights the preamble to the order making the are compatible with Community law. reference stating that, if the questions The Commission states first that in view of referred to the Court are answered in the the substantial delay in the payment of affirmative, 'the conditions required by the slaughtering subsidy on 21 it the law for the execution of the injunction sent to the Italian Government a letter would be fulfilled since the action is based initiating the procedure laid down by on written evidence'. Article 169 of the Treaty. If this interpretation is correct the question The questions put by the Italian court are does not fall within the jurisdiction of the not outside the jurisdiction of the Court. Court since it is thereby invited to interpret The answer to these questions is in the national law. Indeed the expression 'im­ affirmative. In the abovementioned judg­ mediately enforceable pecuniary right' is ment in Politi the Court accepted that all not part of Community law and it might Community regulations 'have direct effect have a different meaning in the legal and are as such capable of creating in­ system of each Member State. dividual rights which national courts must Similar considerations would arise in so protect'. It is true that in this case it is for far as the Court as asked to rule whether the Member States to take certain im­ 'this pecuniary right may not be made plementing measures. However, those subject to certain conditions' by the State measures may not constitute an obstacle concerned. Either this question asks the to the direct applicability of the Com­ Court to utter a truism, that is, that the munity rule or influence in any way the legislature cannot extinguish subjective rights which that rule grants to individuals. rights created by Community rules; or it This is all the more so as Article 10 of seeks to know whether any national Regulation No 2195/69 imposes on Mem­ measure intended to determine the factual ber States the obligation to pay the subsidy conditions for enjoyment of the individual within a period which is precisely fixed right in question is incompatible with the and may not be altered. It appears from Community provisions giving rise to that the seventh recital of the preamble to right. In the latter case, the question as it is Regulation No 2195/69 that the period was put also exceeds the jurisdiction conferred imposed particularly to ensure that the on the Court by Article 177 of the Treaty subsidy should be paid within the same since it asks the Court to rule on the com­ period in all the Member States. patibility of Italian legislation with Com­ Finally, no Member State made use of the munity rules. opportunity provided by Article 10 of As to the substance of the case, the Pretore Regulation No 1975/69 of asking the Com­ di Lonato seems to disregard the fact that mission to authorize it to impose addi­ whilst the regulations in question create tional conditions for the grant of the sub­ individual rights as against Member sidies in question. States, nevertheless those rights can only

Grounds of judgment

1 (1) By order of 3 November 1971, received at the Court Registry on 17 November 1971, the Pretore di Lonato has referred to the Court two questions concerning the interpretation of Regulation (EEC) No 1975/69 of the Council of 6 October 1969 and of Regulation (EEC) No 2195/69 of the Commission of 4 November

292 LEONESIO ν ITALIAN MINISTRY FOR AGRICULTURE AND FORESTRY

1969 relating principally to the grant of subsidies to farmers for slaughtering their milk cows.

2 The first question asks the Court to rule 'Whether the provisions of Regulation No 1975/69 and of Regulation No 2195/69 are directly applicable in the Italian legal system and, if this question is answered in the affirmative, whether they create individual rights which national courts must protect'. The second question asks, in essence, whether, where the conditions set out in Article 5(1) and (2) and in Articles 6 and 9 of Regulation No 2195/69 have been fulfilled, those regulations, in so far as they are concerned with the slaughtering subsidy, confer on the farmer concerned a right as against the Member State to which he belongs to the payment of that subsidy, this being a right to which the national court must afford immediate protection and which that State cannot render subject to additional conditions, in particular as to the period allowed for payment under Article 10 of Regulation No 2195/69.

3 These questions were referred to the Court in view of the fact that the plaintiff in the main action believed that she had complied with all the conditions to which the abovementioned regulations render subject the grant of a subsidy for slaugh­ tering milk cows and had brought before the Pretore di Lonato an application for an injunction ordering the Italian Ministry for Agriculture and Forestry to pay the subsidy. Moreover it appears from the documents in the case that the national authorities, while granting the subsidy on a 'provisional authorization', suspended payment on the ground that it was subject to the prior adoption by the Italian Parliament of legislative provisions allocating the necessary funds.

4 Since these two questions are closely connected a joint reply may be given to them.

5 (2) The second paragraph of Article 189 of the Treaty provides that a regulation shall have 'general application' and 'shall be ... directly applicable in all Member States'. Therefore, because of its nature and its purpose within the system of sources of Community law it has direct effect and is, as such, capable of creating individual rights which national courts must protect.

6 Since they are pecuniary rights against the State, these rights arise when the con­ ditions set out in the regulation are complied with and it is not possible at a national level to render the exercise of them subject to implementing provisions other than those which might be required by the regulation itself. It is in the light of these considerations that the questions put should be answered.

7 (3) With regard to the conditions which the farmer must fulfil in order to be able to claim payment of the subsidy, the authority obliged to pay the subsidy and the

293 JUDGMENT OF 17.5.1972 — CASE 93/71

period within which payment must be made, reference should be made to Articles 1 to 4 and 12 of Regulation No 1975/69 and to Articles 3, 7, 9 and 10 of Regulation No 2195/69.

8 Article 1 of Regulation No 1975/69 provides that 'Farmers having at least two milk cows may, on application, receive a subsidy for slaughtering on the conditions specified below', set by Article 3(1) of that regulation at 200 u.a. for each milk cow slaughtered.

9 Article 2 of that regulation provides that 'The granting of the subsidy is, in par­ ticular, subject to the written undertaking of the recipient: (a) to give up the production of milk entirely and (b) to have all milk cows on his farm slaughtered during a period to be determined and at the latest by 30 '.

10 Article 4(1) of the same regulation provides that 'For farmers having two to five milk cows the subsidy shall be paid when the applicant submits proof that he has fulfilled the undertaking referred to in Article 2(b)'.

11 Article 12 of the regulation states that the 'European Agricultural Guidance and Guarantee Fund, Guidance Section, shall reimburse the Member States 50% of the subsidies' concerned, thereby implying that the Member States are to pay these subsidies to the farmers.

12 According to Article 3 of Regulation No 2195/69 'The application for the grant of the subsidy shall be lodged with the competent authority appointed by each Member State during the period from 1 to 20 ' and was to contain certain information and declarations.

π Article 7 of that regulation provides that 'The slaughtering period referred to in Article 2(b) of Regulation (EEC) No 1975/69 shall last from 9 February to 30 April 1970'.

14 Article 9 of the same regulation determines the manner in which the farmer must provide the proof laid down by Article 4(1) of Regulation No 1975/69.

15 Article 10 of Regulation No 2195/69 states that 'Payment of the subsidy referred to in Article 4(1) ... of Regulation (EEC) No 1975/69 shall take place within two months of the establishment of proof of the slaughtering in accordance with Article 9 of this regulation'.

16 It follows from Article 5 (1) of Regulation No 2195/69 that the grant of the subsidy was further subject to the finding by the Commission 'that the applications lodged may be allowed to proceed', which finding was made in respect of all applications

294 LEONESIO ν ITALIAN MINISTRY FOR AGRICULTURE AND FORESTRY

submitted under Article 3 of that regulation, by Article 1 (a) of Regulation No 140/70.

17 Article 10 of Regulation No 1975/69 empowers the Commission to authorize Member States 'to impose additional conditions' for the grant of the subsidy con­ cerned and Article 19 of Regulation No 2195/69 sets out such conditions, requiring the Member States to notify the Commission in appropriate cases of the provisions adopted by them pursuant to that article. It is common ground however that Italy did not make use of this possibility. It is also established that the Italian Republic adopted the technical measures provided for by Articles 4, 5(2), 6, 8 and 11 of Regulation No 2195/69.

18 (4) The effect of all these provisions is that once all the conditions laid down in Regulations Nos 1975/69 and 2195/69 were fulfilled, those regulations conferred on farmers a right, which national courts must protect, to payment of the slaugh­ tering subsidy by the Member State to which they belonged; such rights could be exercised in each case at the end of the period of two months following the estab­ lishment of the proof of slaughter as provided in Article 10 of Regulation No 2195/69.

19 As from that time, the abovementioned regulations give the farmer the right to require payment of the subsidy without that Member State's being able to rely on arguments based on any legislative provisions or administrative practices to with­ hold such payment. This finding is reinforced by the seventh recital of the pre­ amble to Regulation No 2195/69 which emphasizes that 'it should be ensured that subsidies are paid in all Member States within the same period'.

20 Nevertheless, the Italian Government has stated that the regulations in question, did not create the right to payment of the subsidy where the national legislature had not allocated the necessary funds for this purpose.

2i The first paragraph of Article 5 of the Treaty provides that 'Member States shall take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of this Treaty or resulting from action taken by the institutions of the Community'. If the objection of the Italian Government were upheld it would have the result of placing farmers in that State in a less favourable position than their counterparts in other Member States in disregard of.the fun­ damental rule requiring the uniform application of regulations throughout the Community. Moreover, Regulations Nos 1975/69 and 2195/69 lay down exhaus­ tively the conditions on which the creation of the individual rights in question depend and these do not include considerations of a budgetary nature.

22 So as to apply with equal force with regard to nationals of all the Member States, Community regulations become part of the legal system applicable within the

295; JUDGMENT OF 17.5.1972 — CASE 93/71

national territory, which must permit the direct effect provided for in Article 189 to operate in such a way that reliance thereon by individuals may not be frustrated by domestic provisions or practices.

23 Budgetary provisions of a Member State cannot therefore hinder the direct ap­ plicability of a Community provision and consequently of the exercise of individual rights created by such a provision.

24 The costs incurred by the Government of the Italian Republic and by the Com­ mission of the European Communities, which have submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main action 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,

Upon reading the pleadings ; Upon hearing the report of the Judge-Rapporteur; Upon hearing the oral observations of Mrs Leonesio, the Government of the Italian Republic and the Commission of the European Communities; Upon hearing the opinion of the Advocate-General; Having regard to the Treaty establishing the European Economic Community, especially Articles 5, 177 and 189; Having regard to Regulation No 1975/69 of the Council of 6 October 1969 (JO L 252, p. 1); Having regard to Regulation No 2195/69 of the Commission of 4 November 1969 (JO L 278, p. 6); Having regard to the Protocol on the Statute of the Court of Justice of the EEC, especially Article 20; Having regard to the Rules of Procedure of the Court of Justice of the European Communities,

THE COURT

in answer to the questions referred to it by the Pretore di Lonato by order of that court dated 3 November 1971, hereby rules:

1. A Community regulation has direct effect and is, as such, capable of creating individual rights which national courts must protect. Pecuniary rights against the State, conferred by such a regulation, arise when the conditions set out in the regulation are complied with and it is not possible at a national level to render the exercise of them subject to im-

296 LEONESIO ν ITALIAN MINISTRY FOR AGRICULTURE AND FORESTRY

plementing provisions other than those which might be required by the reg­ ulation itself.

2. Once all the conditions laid down in Regulations Nos 1975/69 and 2195/69 were fulfilled, those regulations conferred on fanners a right, which national courts must protect, to payment of the slaughtering subsidy by the Member State to which they belonged; such rights could be exercised in each case at the end of the period of two months following the establishment of the proof of slaughter as provided in Article 10 of Regulation No 2195/69.

As from that time, the abovementioned regulations give the farmer the right to require payment of the subsidy without that Member State's being able to rely on arguments based on any legislative provisions or administrative prac­ tices to withhold such payment.

Lecourt Mertens de Wilmars Kutscher

Donner Trabucchi Monaco Pescatore

Delivered in open court in Luxembourg on 17 .

A. Van Houtte R. Lecourt

Registrar President

OPINION OF MR ADVOCATE-GENERAL ROEMER DELIVERED ON 26 APRIL 19721

Mr President, entirely' and to have all milk cows on Members of the Court, their farms slaughtered 'at the latest by 30 April 1970'. Detailed provisions for the In view of the fact that the 'situation on computation of the subsidies were con­ the market in milk and milk products in tained in Article 3 of the regulation. the Community [was] marked by large and Article 4 provided (in so far as is relevant increasing surpluses', the Council of here) that 'For farmers having two to Ministers decided to establish a system of five milk cows, the subsidy shall be paid subsidies whereby farmers were to be when the applicant submits proof that he encouraged to reduce the number of milk has fulfilled the undertaking referred to in cows by slaughtering. This was done by Article 2(b)' (that is, the undertaking to Regulation No 1975 of 6 October 1969 have all his milk cows slaughtered by 30

(JO L 252, p. 1). Article 2 of that regulation April 1970 at thethe latest). provided for the grant of a subsidy (of Implementing provisions relating to this which half was to be paid from Community regulation were contained in Regulation funds) to cattle owners who undertook in No 2195/69 of the Commission of 4 writing 'to give up the production of milk November 1969 (JO L 278. p. 6). Article 3

1 — Translated from the German.

297