61987J0281

++++

Agriculture - Common organization of the markets - Price formation - National measures - Incompatible with Community rules

The common organizations of the markets are based on the concept of an open market to which every producer has free access and the functioning of which is regulated solely by the instruments provided for in those organizations . In particular, in sectors covered by a common organization of the market, and a fortiori when that organization is based, as in the present case, on a common price system, Member States can no longer take action, through national provisions adopted unilaterally, affecting the machinery of price formation as established under the common organization .

In Case C-281/87

Commission of the European Communities, represented by X . A . Yataganas and D . Gouloussis, members of its Legal Department, acting as Agents, with an address for service in Luxembourg at the office of Georgios Kremlis, a member of the Commission' s Legal Department, Wagner Centre,

applicant,

v

Hellenic Republic, represented by K . Stavropoulos, a lawyer in the European Communities Department of the Ministry of Foreign Affairs, I . Laïos, Legal Adviser in the Ministry of Agriculture, and M . Tsotsanis, a lawyer in the Ministry of Agriculture, with an address for service in Luxembourg at the Greek Embassy, 117 Val Sainte-Croix,

defendant,

APPLICATION for a declaration that the Hellenic Republic has failed to fulfil its obligations under the provisions relating to the common organization of the market in cereals,

THE COURT

composed of : O . Due, President, Sir Gordon Slynn, C . N . Kakouris and F . A . Schockweiler ( Presidents of Chambers ), G . F . Mancini, R . Joliet, T . F . O' Higgins, G . C . Rodríguez Iglesias and M . Diez de Velasco, Judges,

Advocate General : F . G . Jacobs

Registrar : B . Pastor, Administrator

having regard to the Report for the Hearing and further to the hearing on 6 June 1989,

after hearing the Opinion of the Advocate General delivered at the sitting on 6 July 1989,

gives the following

Judgment

1 By application lodged at the Court Registry on 22 September 1987, the Commission of the European Communities brought an action under Article 169 of the EEC Treaty seeking a declaration that by instructing KYDEP, a national association of producers' cooperatives, to purchase inferior-quality durum wheat of the 1982 harvest the Hellenic Republic had failed to fulfil its obligations under the provisions relating to the common organization of the market in cereals .

2 Article 3 of Regulation ( EEC ) No 2727/75 of the Council of 29 October 1975 on the common organization of the market in cereals ( Official Journal 1975, L 281, p . 1 ), as subsequently amended, provides that the Council is to fix annually, inter alia, a single intervention price for durum wheat, which is to be valid for all Community intervention centres . Under Article 7(1 ) of that regulation the intervention agencies designated by the Member States are obliged to buy in durum wheat which has been harvested in the Community and is offered to them, provided that the offers comply with conditions, in particular in respect of quality and quantity, to be determined in accordance with paragraph 5 . Article 7(5 ) provides that the Commission is to fix, in accordance with the "management committee" procedure, the minimum quality and quantity required for intervention and the procedures and conditions for taking over by the intervention agencies .

3 Article 2 of Commission Regulation ( EEC ) No 1569/77 of 11 July 1977 fixing the procedure and conditions for the taking over of cereals by intervention agencies ( Official Journal 1977, L 174, p . 15 ) and the annex thereto define the minimum quality requirements to be met in order for durum wheat to be accepted for intervention; reference is made, for certain definitions, to Annex I to Council Regulation ( EEC ) No 2731/75 of 29 October 1975 fixing standard qualities for common wheat, rye, barley, maize and durum wheat ( Official Journal 1975, L 281, p . 22 ).

4 It appears from the documents before the Court that KYDEP purchases, collects, stores and markets the cereals produced by its members . In addition, it has been designated, by an order of the Minister for Agriculture, as an intervention agency within the framework of the common organization of the market in cereals .

5 It also appears from the documents before the Court that the Minister for Agriculture sent KYDEP Circular Letter 41032 of 7 July 1982 concerning the "taking over of inferior-quality durum wheat of the 1982 harvest", requesting it to purchase all consignments of inferior-quality durum wheat held by producers or threshing undertakings, but not by dealers . That circular letter lists, inter alia, the minimum quality criteria for, on the one hand, durum wheat for processing and, on the other hand, durum wheat intended exclusively for animal feed, and lays down the conditions for applying quality increases and reductions to the purchase price of processable durum wheat . The letter was sent for information to the regional directorates of the Ministry of Agriculture .

6 The Commission maintains that, by implementing such a national intervention measure overriding the comprehensive intervention machinery of the common organization of the market in cereals, the effect of which is to distort the operation thereof, inter alia by interfering with the system of prices and granting producers benefits not provided for under that organization, the Hellenic Republic has infringed the provisions relating to the common organization of the market in cereals .

7 The Hellenic Republic claims that the action is inadmissible inasmuch as it is based on three confidential documents, one of which is the aforementioned circular letter . It says that those documents relate to KYDEP' s functioning as a commercial undertaking and are therefore protected by business secrecy . The defendant also maintains that the Commission did not obtain the documents in a lawful manner .

8 On the substance of the case, the defendant objects that the circular was not binding on KYDEP but was intended solely to inform the producers' associations, through KYDEP and at their own request, of the quality criteria for processable durum wheat and for durum wheat for animal feed, together with the methods of price formation and the factors used therein, in order to enable producers to forestall speculation by dealers . It claims that dealers purchased inferior-quality wheat from producers as wheat intended for animal feed and then sold it to processors as processable durum wheat at a higher price .

9 Reference is made to the Report for the Hearing for a fuller account of the facts of the case, the course of the procedure and the submissions and arguments of the parties, which are referred to hereinafter only in so far as is necessary for the reasoning of the Court .

Admissibility

10 The defendant is not entitled to rely on the confidential nature of the circular in question while at the same time stating that its purpose was to provide producers' associations with information which by its very nature was public .

11 At the hearing, moreover, the Commission stated, without being contradicted by the defendant, that it had come into possession of the circular in issue in a regular manner from individuals who had lodged complaints with it against the national intervention measure with which this case is concerned .

12 The objection of inadmissibility must therefore be rejected in so far as it is based on the nature of the circular and the manner of its coming into the Commission' s possession .

Substance

13 It is clear, from its very title and wording, that the circular letter can only be interpreted as communicating to KYDEP, its addressee, detailed instructions as to the buying in of inferior-quality durum wheat . It makes no mention of information concerning the sale of inferior-quality durum wheat to be passed on to producers' associations, but specifically requests KYDEP to purchase, at prices laid down by the national administrative authorities, all consignments of such wheat held by producers and threshing undertakings . Moreover, the circular excludes the taking over of inferior-quality durum wheat from dealers and contains instructions regarding storage - details which would serve no purpose if it were intended, as the defendant maintains, to inform producers .

14 It must also be pointed out that the defendant was unable to produce, when asked to do so by the Court, the requests for information concerning the various quality criteria and price factors for inferior-quality durum wheat which it claimed the producers' associations had addressed to the Greek authorities .

15 It is clear, moreover, that the quality criteria laid down in the circular letter for the buying in of inferior-quality durum wheat are in several respects less strict than those adopted in Regulation No 1569/77, cited above, for Community intervention measures .

16 The Court has held ( see, inter alia, the judgments of 28 November 1978 in Case 83/78 Pigs Marketing Board v Redmond (( 1978 )) ECR 2347, and of 17 January 1980 in Joined Cases 95 and 96/79 Procureur du Roi v Kefer and Delmelle (( 1980 )) ECR 103 ) that the common organizations of the markets are based on the concept of an open market to which every producer has free access and the functioning of which is regulated solely by the instruments provided for in those organizations . In particular, in sectors covered by a common organization of the market, and a fortiori when that organization is based, as in the present case, on a common price system, Member States can no longer take action, through national provisions adopted unilaterally, affecting the machinery of price formation as established under the common organization .

17 It follows that the circular letter in issue is contrary to the provisions governing the common organization of the market in cereals inasmuch as it constitutes a national intervention measure in a field where the Community rules are exhaustive .

18 It must therefore be held that, by instructing KYDEP to purchase inferior-quality durum wheat from the 1982 harvest, the Hellenic Republic has failed to fulfil its obligations under the provisions relating to the common organization of the market in cereals .

19 Since the failure to fulfil obligations has been sufficiently well established on the strength of the aforementioned circular letter alone, it is not necessary to consider the objection of inadmissibility raised by the Hellenic Republic on the basis of the nature of the two other documents adduced in support of the action and the means of their coming into the Commission' s possession .

Costs

20 Under Article 69(2 ) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been asked for in the successful party' s pleading . Since the defendant has failed in its submissions, it must be ordered to pay the costs .

On those grounds,

THE COURT

hereby :

( 1 ) Declares that, by instructing KYDEP to purchase inferior-quality durum wheat from the 1982 harvest, the Hellenic Republic has failed to fulfil its obligations under the provisions relating to the common organization of the market in cereals;

( 2 ) Orders the Hellenic Republic to pay the costs .