Keywords
Summary

Keywords

1. Agriculture - Common agricultural policy - Financing by the EAGGF - Principles - Aid paid in breach of Community legislation - Failure to observe certain formalities relating to proof or supervision - Charge to the Fund - Not permissible

(Council Regulation No 729/70, Arts 2 and 3)

2. Agriculture - EAGGF - Clearance of accounts - Disallowance of expenditure incurred as a result of failure to apply the Community rules correctly - Financial correction - Assessment of the extent of the shortcomings and the degree of risk to the EAGGF - Where contested by the Member State concerned - Burden of proof

(Commission Regulation No 3887/92, Art. 6)

Summary

1. Articles 2 and 3 of Regulation No 729/70 on the financing of the common agricultural policy allow the Commission to charge to the EAGGF only sums paid in accordance with the rules laid down in the different agricultural sectors. Where it proves impossible to establish with certainty the extent to which a national measure incompatible with Community law has caused an increase in the expenditure entered under a budgetary item of the EAGGF, the Commission has no choice but to disallow all the expenditure in question.

( see paras 38-39 )

2. When the Commission, in the course of clearing the EAGGF accounts, finds structural weaknesses in the control system set up by the authorities of the Member State concerned, the inadequate quality of the on-the-spot checks gives rise to serious doubts concerning the establishment of an adequate and effective set of supervisory measures and inspection procedures for the purposes of Article 6 of Regulation No 3887/92 laying down detailed rules for applying the integrated administration and control system for certain Community aid schemes, such as to justify applying a flat-rate correction. Moreover, where, instead of disallowing all the expenditure affected by the infringement, the Commission has endeavoured to establish rules for treating irregularities differently, depending on the extent of the shortcomings in the checks and the degree of risk to the EAGGF, it is for the Member State to show that those criteria are arbitrary and unfair.

( see paras 48-50 )