Keywords
Summary

Keywords

1 Acts of the institutions - Statement of reasons - Obligation - Scope - Decision relating to the clearance of accounts in respect of expenditure financed by the EAGGF

(EC Treaty, Art. 190)

2 Agriculture - Common agricultural policy - EAGGF financing - Principles - Conformity of expenditure with the Community rules - Burden of proof - Divided between the Commission and the Member State concerned

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

3 Agriculture - EAGGF - Clearance of accounts - Refusal to charge to the EAGGF expenditure arising from irregularities in the application of the Community rules - Assessment of the losses incurred by the EAGGF - Disputed by the Member State concerned - Burden of proof

4 Agriculture - Common organisation of the markets - Beef and veal - Intervention mechanisms - Buying-in by tendering procedures - Relationship between tenderers - Article 9 of Regulation No 859/89 - Interpretation - Rule that tenders must be independent - Scope

(Regulation No 805/68 of the Council, Art. 6(6); Commission Regulations No 859/89, Arts 9, 12(2) and 15, and No 2456/93, Art. 11)

5 Agriculture - Common agricultural policy - EAGGF financing - Principles - Conformity of expenditure with the Community rules - Obligation to supervise incumbent on the Member States

(EC Treaty, Art. 5; Regulation No 729/70 of the Council, Art. 8(1))

Summary

1 The extent of the obligation to state reasons, laid down in Article 190 of the Treaty, depends on the nature of the measure in question and on the context in which it was adopted.

A decision concerning the clearance of accounts in respect of expenditure financed by the EAGGF by which the charging to the EAGGF of part of the expenditure declared is refused does not require detailed reasons if the government concerned was closely involved in the process by which the decision came about and is therefore aware of the reason for which the Commission considers that it must not charge the sums in dispute to the EAGGF.

2 Articles 2 and 3 of Regulation No 729/70 permit the Commission to charge to the EAGGF only sums paid in accordance with the rules laid down in the various sectors of agricultural production, leaving the Member States to bear the burden of any other sum paid, and in particular any amounts which the national authorities wrongly believed themselves authorised to pay in the context of the common organisation of the markets.

Although it is therefore for the Commission to prove an infringement of the Community rules, the Member State concerned must demonstrate that the Commission committed an error as to the financial consequences to be attributed to it. Moreover, the Commission is not compelled to prove that there have been losses but may simply adduce highly significant evidence to that effect.

Where it has established that a Member State infringed several Community rules in the field of agriculture and that harm was probably caused to the Community budget, the Commission cannot be required to do more, since it cannot carry out systematic checks and analysis of the current state of a given market depends on information gathered by the Member States.

3 In the context of its task of clearing the EAGGF accounts and assessing the losses incurred by the EAGGF, where it proves impossible to establish with certainty the extent to which a national measure that is incompatible with Community law has caused an increase in the expenditure of the EAGGF, the Commission has no choice but to disallow all the expenditure in question. Where, instead, the Commission has endeavoured to establish the financial impact of the unlawful action by means of calculations based on an assessment of what the situation on the relevant market would have been if the infringement had not occurred, the burden of proving that those calculations are not correct rests on the Member State.

4 In the context of intervention measures in the beef and veal sector, and in particular of the system of buying-in by tendering procedures, Article 9(1) of Regulation No 859/89 provides that tenderers must undertake to comply with all the relevant provisions and Article 9(2) that interested parties may submit one tender only per category in response to each invitation to tender. Since the need to ensure legal certainty means that rules must enable those concerned to know precisely the extent of the obligations which they impose on them, the wording of Article 9(2) cannot provide any support for the interpretation that, on account of the difference in meaning between the words `interested party' and `tenderers', the latter may submit one tender only in response to an invitation to tender where they are part of a single group. Such an interpretation would thus be tantamount to applying retroactively Article 11 of Regulation No 2456/93, which introduces into the Community legislation provisions on the relationship between tenderers.

That being the case, although the rule that tenders must be independent, an essential requirement for the validity and effectiveness of any tender procedure, which underlies Articles 9(6) (confidentiality of tenders), 12(2) (prohibition on the transfer of rights and obligations arising from the tender procedure), 9(4)(c) (tenderers' obligation to lodge a security) and 15 (tenderers' obligation to receive payment personally) of Regulation No 859/89 and Article 6(6) of Regulation No 805/68 (equality of access for all persons concerned), does not prevent several companies belonging to one group from taking part at the same time in one tender procedure, it does preclude those same companies from agreeing on the terms and conditions of the tenders which they each submit, if the tender procedure is not to be distorted.

5 Article 8(1) of Regulation No 729/70, which constitutes a specific expression in the agricultural area of the obligations imposed on Member States by Article 5 of the Treaty, defines the principles according to which the Community and the Member States must ensure the implementation of Community decisions on agricultural intervention financed by the EAGGF and combat fraud and irregularities in relation to those operations. It imposes on the Member States the general obligation to take the measures necessary to satisfy themselves that the transactions financed by the EAGGF are actually carried out and are executed correctly, even if the specific Community act does not expressly provide for the adoption of particular supervisory measures, particularly when there is evidence such as to give rise to serious suspicions that a prohibition laid down by the Community act in question has been circumvented.