1 (a)

Does the concept of an agricultural holding provided in the Treaty by express reference to goods produced through the establishment and running of a business, clarified by regulations separating such business from any territorial connexion (precisely where provision is made for agricultural holdings with an agricultural area less than one hectare and agricultural holdings without any agricultural area) apply only within the institutions of the EEC and is it accordingly not binding upon the Member States who are thus free to define agricultural holdings with reference to criteria differing from or contrary to the criteria adopted by the Treaty of Rome and by the said regulations?

1 (b)

Has the Community adopted a Community concept of an agricultural holding which applies in the individual Member States for the purposes of identifying holdings of this nature and are the Member States accordingly obliged to employ the concepts provided in the Treaty and the said regulations in order to identify the agricultural holdings to which must then be applied the principles laid down at Community level and those evolved by the various national legal systems with regard to social security?

2 (a)

Can the individual Member States adopt provisions or maintain a practice derogating therefrom?

2 (b)

Is the concept of an agricultural holding provided in the Treaty and in the regulations binding and directly applicable within the Italian legal system for the purposes laid down in the Community provisions and the said Italian legal system?

3 (a)

Has the concept of an agricultural holding adopted by the EEC and incorporated into the several legal systems of the Member States established for individual holdings, defined and indentified as agricultural, individual rights which may be related to this classification and which the national courts must protect?

4 (a)

Are the individual rights related to the duty of the Member States not to impose upon agricultural holdings charges which, although unconnected, according to the national legal systems, with the nature of agricultural holdings as defined with reference to the criteria supplied by the Treaty and by the Community regulations, are nevertheless capable of discriminating, for social security purposes, between Iulian agricultural holdings raising poultry and such holdings in other countries in the Community?

1. 

There is no express definition of the expression ‘agricultural holding’ anywhere in the Treaty. At most in Part two, Title II, certain factors are discernible showing what the basic concept of the Treaty apparently is.

The main one is Article 38 which provides that the Common Market shall extend to agriculture and trade in agricultural products; it gives a definition of agricultural products and refers for details to the list in Annex II. From this it may be inferred that the concept of ‘agriculture’ means the producers of the said products. Since the extensive list mentions fish and stockfarming without qualification, it is also clear that the working of the soil is obviously not an indispensable factor.

Articles 39 and 42 of the EEC Treaty provide some confirmation of this. From the fact that in Article 39, which sets out the objectives of the Common Agricultural Policy, the concepts ‘agricultural productivity’ and ‘agricultural production’ have an important part to play, it may be inferred that agriculture means the production of certain products, namely those referred to in Article 38. According to Article 42 the chapter relating to rules on competition is to apply to production of and trade in agricultural products only to the extent determined by the Council. This provision can relate only to the producers of the products referred to in Article 38.

This however is all that is relevant in the Treaty on the definition in question.

2. 

A different picture is presented by secondary Community law in which a whole series of sometimes very detailed definitions is to be found. Some are mentioned in the order for reference; in the proceedings a number of others was mentioned in addition.

In chronological order of adoption of the relevant regulations the following may be mentioned :

It is significant however that no uniform definitions are to be found in these regulations. Compare only — I will not give detailed quotations — on the one hand Regulations Nos 70/66, 91/66, 3228/76 and Directive No 75/108 with Regulation No 1035/76 and Directive No 75/268 on the other hand. It is significant moreover that some of these regulations expressly provide that the national legislature shall make the necessary definitions or that it may lay down additional provisions and criteria (as for example the Directives No 72/159 and No 75/268).

It would accordingly be incorrect to assume that a uniform concept of the agricultural holding with a conclusive definition may be derived from secondary Community law and it can therefore in no way be said that any such concept so derived does not depend on the working of the soil.

3. 

After these first two observations which have caused no difficulty let me consider the question which has also been raised whether the definitions in Community law of the term ‘agricultural holding’, in so far as there are any, are binding on Member States in the sense of being directly applicable and giving rise to individual rights. My observations on this can be quite brief for reasons which will easily be apparent later.

So far as the secondary Community law referred to is concerned I would observe that an answer in the affirmative to the question raised cannot be excluded, at least in so far as it is a question of clear and unambiguous provisions containing no discretionary powers for the Member States.

On the other hand so far as concerns the concept behind the provisions of Articles 38, 39 and 42 of the Treaty, the answer to the question raised depends on the subject-matter to which the term applies. This will have to be looked at more closely right away. Moreover in any case it depends whether the provisions in which it is contained or for which it is relevant are according to their subjea-matter directly applicable and give rise to individual rights.

In my view there is no need to say anything further on this question in the present case.

4. 

Let us come then to what in my view must be regarded as the central issue of the reference for a preliminary ruling, namely the question whether the concept of ‘agricultural holding’ in Community law, in so far as it is ascertainable, must be applied to the national social security law where, as in Iulian law, there is a distinction between agricultural holdings and other businesses.

This is the view which the plaintiff in the main aai on takes. The plaintiff refers to the fact that in the sphere with which it is concerned (egg production and poultry raising) there are two common organizations of the market (Regulations Nos 2771/75 and 2777/75 (Official Journal No L 282 of 1 November 1975, p. 49 and p. 77). Therefore it may be inferred that to this extent legislative jurisdiction has been completely transferred to the Community and that the Member States have no rival powers in respect of regulations to influence the competitive position on the egg and poultry market. It refers moreover in support of its case to the case-law of the Court claiming that in this respect it is significant that in Case 34/70, Syndicat National du Commerce Extérieur des Céréales and Others v Office National Interprofessionnel des Céréales and Minister for Agriculture [1970] ECR 1233 the necessity is stressed of understanding the words ‘every holder’ [of cereals] in the sense they have in Community law and that in the judgment in Case 131/73, Grosoli [1973] ECR 1555 it was stressed in relation to a Community quota of frozen beef and veal that the Member States did not have authority to lay down rules governing the use of the quota and that accordingly it was not possible to lay down national restrictions on the sale of the said products.

Let me say at once that I have not been convinced by these arguments.

First it is significant — and here I refer to the concepts to be found in the secondary Community law — that their application is limited to the content of the particular rules. This is in part expressly stated in these particular Community measures and in part it may at least be clearly inferred from them. I refer now only to Regulations Nos 70/66, 91/66 and 3228/76 and Directives Nos 72/159 and 75/108. In so far as this limitation of the definition to the particular rule is not completely apparent from the rule itself, it may in my view, at least in so far as the general words ‘agricultural holding’ are concerned, be inferred from the Treaty.

In my opinion it must be taken that this concept applies essentially only to the rules of the Common Agricultural Policy, that is, the areas covered in Part two, Title II. Sufficient authority for this is Article 38 (2) of the Treaty which provides that the rules laid down for the establishment of the Common Market shall apply to agricultural products save as otherwise provided in Articles 39 to 46.

In my view therefore it is irrelevant to claim that only by interpreting the words ‘agricultural holding’ in the sense they have in Community law is it possible properly to apply the regulations on the grant of aids to agricultural holdings such as were adopted in 1969 and 1973 in favour of the German and Dutch agriculture (Regulation No 2464/69 of the Council of 9 December 1969 (Official Journal, English Special Edition 1969 (II), p. 527) and Regulation No 3141/73 of the Council of 19 November 1973 (Official Journal No L 321 of 22 November 1973, p. 1)). In this respect it should not be forgotten that these two regulations were concerned with the Common Agricultural Policy.

For the same reason the plaintiff's reference to the said two judgments, particularly the judgment in Case 34/70, does not help. This is also concerned with measures under a common organization of the market (the intervention arrangements in Regulation No 1028/68) and for that it is quite clear that a uniform concept in Community law of ‘every holder’ [of cereals] must apply and that the Member States may not alter or restrict it.

So far as concerns social security law in particular, with which the main action is concerned, it is quite apparent from the system of the Treaty that its regulation and thus also the determination of the requisite definition is a matter for the Member States. In this respect reference may be made to Article 118 of the EEC Treaty which provides .only for close co-operation between the Member States in the social field but not for establishing a single system or for harmonization and moreover according to what the Commission says no Community provisions have yet been adopted on this subject. Reference should also be made to Article 51 of the Treaty which provides only for co-ordination of the law on social security for the purposes of facilitating freedom of movement and assumes that different national social security systems will continue. In the same way the recitals in the preamble to Regulation No 1408/71 (Official Journal, English Special Edition 1971 (II), p. 416) refer to the considerable differences existing between national social security legislations. Moreover the regulation is mainly directed to benefits from social security and the avoidance of the loss of rights in this respect whereas contributions are touched on only to a limited extent as in Article 91 which provides that an employer shall not be bound to pay increased contributions by reason of the fact that his place of business or the registered office or place of business of his undertaking is in the territory of a Member State other than the competent State.

In view of the foregoing remarks it may be said that in the sphere of social security, the regulation of which is basically for the Member States, the concept of ‘agricultural holding’ under Community law is no criterion. This may well affect the holdings covered by the common organizations of the market since their production costs may differ according to their classification. The Commission is however right in stressing that this is not to be compared with the cases of national measures dealt with in the case-law (such as in the judgment of 25 May 1977 in Case 77/76, Fratelli Cucchi v Avez S.p.A. [1977] ECR 987) which relate directly and intentionally to the formation of prices and which because they affect the price formation mechanisms of Community law must be judged by the requirements of Community law.

5. 

This, it is true, does not yet completely dispose of the case. As intimated there remain additional considerations to be discussed which have been brought forward by the plaintiff in the main action to support its view that there must be a concept of the agricultural holding binding on the Member States. It was said that any other view would involve the danger of considerable discrimination; it was alleged that the objectives of Article 39 would be impeded if the requisite definition and accordingly the possibility of different social security contributions were left to the Member States and the view was put forward that such differentiation could take place only under the terms of the provisions on aids of Article 92 and subject to the conditions laid down therein:

On this the following observations are called for:

6. 

In my view the questions from the Tribunale Civile in Rome should be answered as follows:

Community law does not have any general definition of the concept of ‘agricultural holding’ applicable in all sectors. In sectors where — as here in social security law — the Community definitions, whether derived from Article 38 of the Treaty or from special regulations in the agricultural sector, are not binding, the Member States are consequently free to determine the said concept themselves and accordingly to regard holdings as industrial undertakings even if they produce agricultural products within the meaning of the Treaty.