Case T‑475/21

French Republic

v

European Commission

 Judgment of the General Court (Ninth Chamber), 21 September 2022

(EAGF and EAFRD – Expenditure excluded from financing – Expenditure incurred by France – Voluntary coupled support – Eligibility conditions – Eligible sectors and productions – Article 52(2) of Regulation (EU) No 1307/2013)

1.      Agriculture – Common agricultural policy – Direct support schemes – Common rules – Voluntary coupled support – Eligible sectors and productions – Limitative and exhaustive list

(Council Regulation No 1307/2013, Art. 52(2))

(see paragraphs 26, 27)

2.      Agriculture – Common agricultural policy – Direct support schemes – Common rules – Voluntary coupled support – Conditions under which applicable – Discretion of the Member States – Scope

(Council Regulation No 1307/2013, Art. 52(2), (3) and (5); Commission Regulation (EU) No 639/2014, Art. 52(3))

(see paragraphs 30-32)

3.      Agriculture – Common agricultural policy – Direct support schemes – Common rules – Voluntary coupled support – Objective – Coupled support granted to mixtures of legumes and grasses – Exclusion – Legumes beneficial for the environment – No effect

(Council Regulation No 1307/2013, recital 49 and Title III, Chapter 3, and Art. 52(2), (3) and (5); Commission Regulation (EU) No 639/2014, Art. 52(3)

(see paragraphs 38, 39, 44, 48, 49)

4.      Agriculture – Common agricultural policy – Direct support schemes – Common rules – Voluntary coupled support – Eligible sectors and productions – Mixtures of legumes and grasses – Concept of agricultural sector – Definition – Elements to be taken into consideration – All common, established practices in a Member State for the production of crops belonging to a sector – Exclusion

(Council Regulation No 1307/2013, Art. 52(2) and (3); Commission Regulation (EU) No 639/2014, Art. 52(2))

(see paragraphs 50, 51, 56, 58, 59)

Résumé

CAP financing and aid to Member States: the General Court dismisses the action brought by France challenging a financial correction amounting to EUR 46 million proposed by the Commission

In 2016, the French authorities notified the European Commission of a coupled support measure for the protein crops sector. The eligible areas for that support were those cultivated for fodder legumes either alone, in mixtures with other fodder legumes or in mixtures with other varieties, such as grasses, where legumes were predominant.

On the basis of an inquiry which it initiated, the Commission found that the conditions of eligibility for that support did not comply with EU law. In its view, as grasses were not listed among the eligible sectors and productions in Article 52(2) of Regulation No 1307/2013, (1) mixtures of legumes and grasses could not be granted coupled support. Thus, by its Implementing Decision (EU) 2021/988 (2) (‘the contested decision’), the Commission excluded from European Union financing an amount of EUR 45 869 990.19 corresponding to expenditure incurred by the French Republic in respect of voluntary coupled support for the production of fodder legumes relating to claim year 2017.

After proceedings were brought by the French Republic, the General Court dismisses the action for annulment brought against the contested decision. In that connection, it interprets for the first time the provisions of Regulation No 1307/2013 and of Regulation No 639/2014, (3) which concern the sectors and productions eligible for voluntary coupled support.

Findings of the Court

On the basis of a literal, contextual and teleological interpretation of Article 52(2) of Regulation No 1307/2013, the Court answers in the negative the question whether mixtures of agricultural products coming under one of the sectors or productions listed in that article, such as legumes, and agricultural products not coming thereunder, such as grasses, are eligible for coupled support. In doing so, it rejects the broad interpretation of eligible sectors and productions advocated by the French Republic.

Thus, first, the Court notes that Article 52(2) of Regulation No 1307/2013 contains a limitative list of sectors and productions eligible for coupled support and does not mention mixtures of products coming under the sectors or productions expressly listed and products not coming under those sectors or productions.

Second, a combined reading of the provisions of Article 52 of Regulation No 1307/2013 and Article 52 of Regulation No 639/2014 shows that the legislature intended to restrict the option for Member States to grant coupled support by introducing cumulative conditions which limit considerably the group of eligible beneficiaries and its material scope. In addition, coupled support is an aid scheme which constitutes a derogation from the other aid schemes governed by Regulation No 1307/2013 such that the conditions for its application are to be interpreted strictly.

Third, the Court holds that the objective of coupled support is not to support agricultural production in general or measures beneficial for the environment, but production in relation to certain agricultural sectors or certain specific productions which experience difficulties. Consequently, even assuming that legumes have benefits for the environment, as the French Republic asserts, that does not establish that the objective of supporting the production of fodder legumes would be effectively pursued by coupled support granted to mixtures of legumes and grasses.

Lastly, the Court rejects the interpretation proposed by the French Republic to the effect that account should be taken of the common, established practices in a Member State in order to define an agricultural ‘sector’ for the purposes of Article 52(2) of Regulation No 1307/2013. Such an interpretation does not, in particular, ensure legal certainty and a uniform interpretation within the European Union of the rules on coupled support. It is therefore considered to be incompatible with the requirements of clarity and predictability of the applicable legal rule. Accordingly, even assuming that mixtures of legumes and grasses constitute a common, established practice in France in the ‘protein crops’ sector, such crops do not come under that sector for the purposes of Article 52(2) of Regulation No 1307/2013.

1      Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and repealing Council Regulation (EC) No 637/2008 and Council Regulation (EC) No 73/2009 (OJ 2013 L 347, p. 608).

2      Commission Implementing Decision (EU) 2021/988 of 16 June 2021 excluding from European Union financing certain expenditure incurred by the Member States under the European Agricultural Guarantee Fund (EAGF) and under the European Agricultural Fund for Rural Development (EAFRD) (OJ 2021 L 218, p. 9).

3      Commission Delegated Regulation (EU) No 639/2014 of 11 March 2014 supplementing Regulation (EU) No 1307/2013 of the European Parliament and of the Council establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and amending Annex X to that Regulation (OJ 2014 L 181, p. 1).