Keywords
Summary

Keywords

1. Community law – Principles – Principle of retroactive application of the more lenient penalty

(Council Regulation No 2988/95, Art. 2(1) and (2))

2. Agriculture – Common agricultural policy – Integrated administration and control system for certain aid schemes

(Council Regulations No 2988/95, Art. 2(2), and No 1782/2003; Commission Regulations No 3887/92, Art. 10c, No  2419/2001, Art. 39(1), and No 796/2004, Arts 66 and 67)

Summary

1. The principle of the retroactive application of the more lenient penalty forms part of the constitutional traditions common to the Member States and, accordingly, must be considered to be one of the general principles of Community law, which the Court ensures are respected and which national courts are required to abide by.

That principle is expressed more specifically in the second sentence of Article 2(2) of Regulation No 2988/95 on the protection of the European Communities’ financial interests, pursuant to which the competent authorities are required to apply retroactively to conduct constituting an irregularity within the meaning of Article 2(1), subsequent amendments made by provisions contained in Community sectoral rules introducing less severe administrative penalties.

(see paras 59‑60)

2. The second sentence of Article 2(2) of Regulation No 2988/95 on the protection of the European Communities’ financial interests is to be interpreted as meaning that the provisions laid down by Articles 66 and 67 of Regulation No 796/2004 laying down detailed rules for the implementation of cross‑compliance, modulation and the integrated administration and control system provided for in Regulation No 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers, as amended and corrected by Regulation No 239/2005, may not be applied retroactively to an application for ‘livestock’ aid falling within the scope ratione temporis of Regulation No 3887/92 laying down detailed rules for applying the integrated administration and control system for certain Community aid schemes, as amended by Regulation No 2801/1999, which gave rise to an exclusion from the benefit of aid under Article 10c of that regulation.

The system of penalties established in Articles 66 and 67 of Regulation No 796/2004 is not designed to change the nature or severity of the penalties applicable in the context of the aid system for bovine animals established by Regulation No 1254/1999 on the common organisation of the market in beef and veal, but is aimed at adapting those penalties, from the entry into force of Regulation No 1782/2003, to the new regulatory context resulting from reform of the common agricultural policy introduced by the latter regulation, in order to maintain the coherence of the system of penalties applicable to the aid schemes concerned in the light of the principles underlying that reform. The system introduced by Articles 66 and 67 does not therefore reflect a revised assessment by the Community legislature as to whether the penalty is commensurate with the gravity of the irregularity at issue.

It follows that the system of penalties, being so directly and closely related to the reform of the common agricultural policy introduced by Regulation No 1782/2003, cannot, without distorting the system of cross‑compliance as envisaged by the Community legislature in the context of that reform, be transposed to a case of non‑compliance with the rules of identification and registration of bovine animals falling ratione temporis under Regulation No 3887/92. Accordingly, the system does not constitute a ‘subsequent amendment’, within the meaning of the second sentence of Article 2(2) of Regulation No 2988/95, of the system of penalties provided for by Regulation No 2419/2001 laying down detailed rules for applying the integrated administration and control system for certain Community aid schemes established by Regulation No 3508/92, as amended by Regulation No 118/2004, it cannot be relied on in such a context. On the other hand, Article 39(1) of Regulation No 2419/2001, as amended by Regulation No 118/2004, may be relied on in such a context. That provision which constitutes such a ‘subsequent amendment’ of Article 10c of Regulation No 3887/92, inasmuch as it introduces inter alia an upper limit on the reduction applicable, contains a system of penalties which are less severe than those set out in the latter provision. It is therefore for the national court to apply Article 39(1) retroactively to the farmer concerned.

(see paras 70, 82‑85)