Keywords
Summary

Keywords

1 Agriculture - Common organisation of the markets - Oils and fats - Olive oil - Consumption aid - Aid advanced subject to the lodging of security - Release of the security - Condition - Prior recognition of entitlement to aid - Where the security is released by the national authorities in breach of that condition - Where new security is lodged after the initial security has been released - No bearing on the contravention committed

(Commission Regulation No 2677/85, Art. 11(3), as amended by Regulation No 571/91, Art. 1(19))

2 Agriculture - EAGGF - Clearance of accounts - Expenditure disallowed because of irregularities in the application of the Community rules - Challenged by the Member State concerned - Burden of proof

Summary

1 In accordance with Article 11(3) of Regulation No 2677/85 laying down implementing rules in respect of the system of consumption aid for olive oil, as amended by Article 1(19) of Regulation No 571/91, where, on the basis of information supplied by the national body responsible for checking entitlement to aid as regards the recognition of the entitlement to aid of each approved undertaking, the competent national authorities find irregularities, entitlement to the aid may not be recognised. The security lodged in order to be granted an advance payment must be forfeited in proportion to the quantities in respect of which the conditions giving entitlement to the aid were not complied with. Where serious doubts exist as to the lawfulness of the actions of an undertaking requesting aid, the conditions governing entitlement to the aid are not satisfied and the security lodged by that undertaking in order to be granted an advance may not be released.

The above provision requires sums advanced by way of aid to remain covered by security for so long as entitlement to the aid cannot be recognised. Accordingly, where the national authorities, acting in breach of that provision, release the security initially lodged even though they have serious doubts as to the lawfulness of the undertaking's actions, the lodging of new securities subsequent to the release of the security initially lodged has no bearing on the contravention committed by those authorities.

2 Where the Commission refuses to charge certain expenditure to the EAGGF on the ground that it was incurred as a result of breach of Community rules for which a Member State can be held responsible, it is for that State to show that the conditions for obtaining the financing refused are fulfilled. The Commission is not required to demonstrate that there are irregularities in the data submitted by Member States; it is sufficient for it to show that it has serious and reasonable doubts. The reason for this mitigation of the burden of proof on the Commission is that it is the State which is best placed to collect and check the data required for the clearance of EAGGF accounts, and which is consequently required to adduce the most detailed and comprehensive evidence that its figures are accurate and, if appropriate, that the Commission's calculations are incorrect. In the event of a dispute, it is for the Commission to prove that the rules of the common organisation of the agricultural markets have been infringed and, once it has established such an infringement, the Member State concerned must then, if appropriate, demonstrate that the Commission committed an error as to the financial consequences to be drawn.