61973J0178

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AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - LEVIES AND REFUNDS - PROSECUTIONS AND PROCEEDINGS - POWERS OF MEMBER STATES

( REGULATON NO 729/70 OF THE COUNCIL, ARTICLES 4 AND 8; DECISION OF 21 APRIL 1970, ARTICLE 6 )

IT FOLLOWS FROM ARTICLES 4 AND 8 OF REGULATION NO 729/70 AS WELL AS ARTICLE 6 OF THE DECISION OF 21 APRIL 1970 THAT IT CONTINUES TO BE THE TASK OF MEMBER STATES TO UNDERTAKE PROSECUTIONS AND PROCEEDINGS FOR THE PURPOSE OF THE SYSTEM OF LEVIES AND REFUNDS AND TO CONTINUE TO TAKE STEPS TO THIS END VIS-A-VIS THE PARTIES INVOLVED .

IT FOLLOWS FROM THIS THAT THE POSITION OF THE MEMBER STATES AND OF THEIR AUTHORITIES WHICH ARE PARTIES TO THE LEGAL PROCEEDINGS IN RELATION TO THE REIMBURSEMENT OF COMMUNITY REVENUE EVADED ON SUMS IMPROPERLY PAID, HAS NOT BEEN AFFECTED BY THE CONSEQUENCES OF THE ATTRIBUTION TO THE COMMUNITY OF ITS OWN RESOURCES .

IN JOINED CASES 178, 179 AND 180/73

REFERENCE TO THE COURT OF JUSTICE UNDER ARTICLE 177 OF THE EEC TREATY BY THE HOF VAN BEROEP ( COURT OF APPEAL ) OF BRUSSELS ( 15THE CHAMBER ) FOR A PRELIMINARY RULING IN THE ACTION PENDING BEFORE THAT COURT BETWEEN

1 . THE BELGIAN STATE, ACTING THROUGH THE MINISTER OF ECONOMIC AFFAIRS

AND

2 . THE GRAND DUCHY OF LUXEMBOURG, ACTING THROUGH THE MINISTERS OF FOREIGN AFFAIRS, OF FOREIGN TRADE, OF AGRICULTURE AND - TO THE EXTENT NECESSARY - OF FINANCE,

AS 'PARTIES CIVILES' ( PARTY CLAIMING DAMAGES IN CRIMINAL PROCEEDINGS )

AND

1 . PIETER MERTENS AND OTHERS, INCLUDING JOSEPH VAN DEN AVENNE AND LUCOVICUS JOOSEN ( CASE 178/73 )

2 . VICTOR BLOCH ( CASE 179/73 )

3 . JOSEPH VAN SLAMBROUCK AND OTHERS ( CASE 180/73 )

ON THE INTERPRETATION OF REGULATION NO 25 OF THE COUNCIL OF 4 APRIL 1962, ON THE FINANCING OF THE COMMON AGRICULTURAL POLICY ( OJ NO 30 OF 20 . 4 . 1962, P . 991 ) AND NO 729/70 OF 21 APRIL 1970, ON THE FINANCING OF THE COMMON AGRICULTURAL POLICY ( OJ L 94, 28 . 4 . 1970, P . 13 ) AND THE COUNCIL DECISION OF 21 APRIL 1970, ON THE REPLACEMENT OF FINANCIAL CONTRIBUTIONS FROM MEMBER STATES BY THE COMMUNITIES' OWN RESOURCES ( OJ L 94, 28 . 4 . 1970, P . 19 ),

1 BY ORDERS OF 26 OCTOBER 1973 ( CASES 178/73 AND 179/73 ) AND 31 OCTOBER 1973 ( CASE 180/73 ), RESPECTIVELY FILED WITH THE REGISTRY ON 30 OCTOBER AND 6 NOVEMBER 1973, THE HOF VAN BEROEP OF BRUSSELS REFERRED UNDER ARTICLE 177 OF THE TREATY TWO IDENTICAL QUESTIONS TO THE COURT, CONCERNING THE INTERPRETATION OF THE PROVISIONS OF REGULATION NO 25 OF THE COUNCIL OF 4 APRIL 1962 ON THE FINANCING OF THE COMMON AGRICULTURAL POLICY ( OJ NO 30/62, P . 991 ) AND THE PROVISIONS OF REGULATION NO EEC 729/70 OF THE COUNCIL OF 21 APRIL 1970 ON THE FINANCING OF THE COMMON AGRICULTURAL POLICY ( OJ L 94/13 ) AND THE COUNCIL DECISION OF THE SAME DATE, ON THE REPLACEMENT OF THE FINANCIAL CONTRIBUTIONS OF MEMBER STATES BY THE COMMUNITIES' OWN RESOURCES ( OJ L 94/19 );

2 IT IS CLEAR FROM THE COURT RECORD THAT THE QUESTIONS ARE SUBMITTED IN THE CONTEXT OF CRIMINAL PROCEEDINGS BASED ON FRAUD IN CONNECTION WITH THE EXPORTATION AND IMPORTATION OF PRODUCTS FALLING WITHIN THE COMMON ORGANIZATIONS OF THE MARKET, IN WHICH THE BELGIAN STATE AND THE GRAND DUCHY OF LUXEMBOURG APPLIED TO BE JOINED AS 'PARTIES CIVILES' FOR THE PURPOSE OF ASKING THE COURT TO ORDER THE PARTIES INVOLVED AND THE BODIES RESPONSIBLE IN CIVIL LAW, TO REIMBURSE THE EXPORT REFUNDS ILLEGALY OBTAINED AND TO PAY THE IMPORT LEVIES AVOIDED;

3 SOME OF THE ACCUSED HAVING ALLEGED THAT BY REASON OF THE ESTABLISHMENT OF A COMMON AGRICULTURAL POLICY AND IN PARTICULAR THE ADOPTION OF RULES FOR ITS FINANCING, IT IS NO LONGER THE MEMBER STATES BUT THE EUROPEAN ECONOMIC COMMUNITY WHICH IS INVOLVED IN THE COLLECTION OF THE LEVIES AND THE GRANT OF REFUNDS, THE NATIONAL COURT CONSIDERED A DECISION ON THIS POINT TO BE NECESSARY TO ENABLE IT TO GIVE JUDGMENT .

4 THE THREE SERIES OF QUESTIONS BEING IDENTICAL IT IS APPROPRIATE TO REPLY THERETO BY A SINGLE JUDGMENT;

5 SINCE THE PURPOSE OF THESE QUESTIONS IS TO CLARIFY THE POSSIBLE PROCEDURAL CONSEQUENCES OF THE ATTRIBUTION TO THE COMMUNITY OF ITS OWN RESOURCES - THE FIRST ONE RELATING TO THE POSITION OF COMMUNITY LAW DURING THE TRANSITIONAL PERIOD, THE SECOND TO THAT IN FORCE DURING THE SINGLE MARKET STAGE - IT IS RIGHT TO EXAMINE FIRST THIS LATTER QUESTION;

6 THIS QUESTION ASKS WHETHER REGULATION NO 729/70 AND THE COUNCIL DECISION OF THE SAME DATE, AS WELL AS THE PROVISIONS FOR CARRYING THESE INTO EFFECT, MUST BE UNDERSTOOD AS MEANING THAT AS FROM THEIR COMING INTO FORCE ALL SOVEREIGN POWERS BEARING UPON OWN REVENUE AND EXPENDITURE RELATING TO THE COMMON AGRICULTURAL POLICY WERE TRANSFERRED TO THE MEMBER STATES OF THE COMMUNITY, SO THAT ( 1 ) THE COMMUNITY ALONE IS HENCEFORTH ABLE TO TAKE LEGAL PROCEEDINGS IN RELATION TO THIS REVENUE AND EXPENDITURE AND ( 2 ) ANY POWER OF MEMBER STATES TO ASSIST THE COMMUNITY IN COLLECTION OR PAYMENT MUST HENCEFORTH BE CONSIDERED AS NO LONGER A POWER BELONGING TO THE MEMBER STATE ( POSSIBLY SHARED WITH THE COMMUNITY ) BUT AS AN AUTHORITY EXERCISED ON BEHALF OF THE COMMUNITY;

7 IN THE EVENT OF AN AFFIRMATIVE ANSWER BEING GIVEN TO THIS QUESTION, IT IS FURTHER ASKED WHETHER SUCH A REPLY EQUALLY APPLIES, BY REASON OF THE DIRECT EFFECT OF THE TRANSFER OF SOVEREIGN POWERS, AS REGARDS PROCEEDINGS INSTITUTED AFTER THE COMING INTO FORCE OF THE AFOREMENTIONED PROVISIONS OR PENDING AT THAT DATE IN RELATION TO FACTS THAT OCCURRED OR RIGHTS THAT ORIGINATED PRIOR THERETO;

8 ARTICLE 2 OF REGULATION NO 25/62 PROVIDES THAT AT THE FINAL STAGE OF THE SINGLE MARKET THE REVENUE ARISING FROM LEVIES COLLECTED ON IMPORTS OF AGRICULTURAL PRODUCTS FROM THIRD COUNTRIES 'SHALL ACCRUE TO THE COMMUNITY AND SHALL BE USED FOR COMMUNITY EXPENDITURE', THE COUNCIL BEING OBLIGED AT THE APPROPRIATE TIME TO INITIATE THE PROCEDURE LAID DOWN IN ARTICLE 201 OF THE TREATY IN ORDER TO IMPLEMENT THESE PROVISIONS;

9 LIKEWISE, THIS ARTICLE 2 PROVIDES THAT AT THE SINGLE MARKET STAGE THE REFUNDS ON EXPORTS OF AGRICULTURAL PRODUCTS TO THIRD COUNTRIES SHALL BE FINANCED BY THE EUROPEAN AGRICULTURAL GUIDANCE AND GUARANTEE FUND .

10 IN CARRYING OUT BOTH THIS PROVISION AND ARTICLES 201 TO 209 OF THE TREATY, REGULATION NO 729/70 AND THE DECISION OF 21 APRIL 1970 PROVIDED RULES FOR THE FINANCING OF EXPORT REFUNDS BY THE FUND, AND FOR THE TOTAL REVENUE FROM AGRICULTURAL LEVIES BEING ENTERED IN THE BUDGET OF THE COMMUNITIES .

11 WHILST THE PROVISIONS REFERRED TO PROVIDE FOR THIS ENTRY IN THE BUDGET OF THE COMMUNITIES OF THE PROCEEDS OF THE AGRICULTURAL LEVIES AND OF THE FINANCING OF EXPORT REFUNDS TO THIRD COUNTRIES AS OWN RESOURCES AND EXPENDITURE, THEY DO NOT SAY ANYTHING PRECISE AS TO ANY POWERS OF THE COMMUNITY AUTHORITIES TO PROCEED TO THE COLLECTION OF THESE LEVIES AND TO GRANT OR PAYMENT OF THESE REFUNDS .

12 ARTICLE 4 OF REGULATION NO 729/70 PROVIDES THAT MEMBER STATES SHALL DESIGNATE THE AUTHORITIES AND BODIES WHICH THEY SHALL EMPOWER TO EFFECT THE EXPENDITURE IN QUESTION AND SHALL COMMUNICATE TO THE COMMISSION PARTICULARLY 'THE ADMINISTRATIVE AND ACCOUNTING CONDITIONS IN ACCORDANCE WITH WHICH PAYMENTS ARE MADE RELATING TO THE IMPLEMENTATION OF COMMUNITY RULES WITHIN THE FRAMEWORK OF THE COMMON ORGANIZATION OF AGRICULTURAL MARKETS '.

13 THIS ARTICLE FURTHER PROVIDES THAT THE COMMISSION SHALL MAKE AVAILABLE TO MEMBER STATES THE NECESSARY CREDITS SO THAT THE DESIGNATED AUTHORITIES AND BODIES MAY, 'IN ACCORDANCE WITH COMMUNITY RULES AND NATIONAL LEGISLATION' MAKE THE PAYMENTS REFERRED TO .

14 ARTICLE 8 OF THE REGULATION PROVIDES THAT THE MEMBER STATES 'IN ACCORDANCE WITH NATIONAL PROVISIONS LAID DOWN BY LAW, REGULATION OR ADMINISTRATIVE ACTION SHALL TAKE THE MEASURES NECESSARY TO ... PREVENT AND DEAL WITH IRREGULARITIES; RECOVER SUMS LOST AS A RESULT OF IRREGULARITIES OR NEGLIGENCE' AND THAT 'IN THE ABSENCE OF TOTAL RECOVERY, THE FINANCIAL CONSEQUENCES ... SHALL BE BORNE BY THE COMMUNITY, WITH THE EXCEPTION OF THE CONSEQUENCES OF IRREGULARITIES OR NEGLIGENCE ATTRIBUTABLE TO ADMINISTRATIVE AUTHORITIES OR OTHER BODIES OF THE MEMBER STATES '.

15 FOR ITS PART, THE DECISION OF 21 APRIL 1970 PROVIDES BY ARTICLE 6 THEREOF THAT THE COMMUNITY RESOURCES IN QUESTION SHALL BE COLLECTED BY THE MEMBER STATES 'IN ACCORDANCE WITH NATIONAL PROVISIONS IMPOSED BY LAW, REGULATION OR ADMINISTRATIVE ACTION, WHICH SHALL, WHERE NECESSARY, BE AMENDED FOR THAT PURPOSE', MEMBER STATES MAKING THESE RESOURCES AVAILABLE TO THE COMMISSION .

16 IT FOLLOWS FROM THESE PROVISIONS THAT IT CONTINUES TO BE THE TASK OF THE MEMBER STATES TO UNDERTAKE PROSECUTIONS AND PROCEEDINGS FOR THE PURPOSE OF THE SYSTEM OF LEVIES AND REFUNDS AND TO CONTINUE TO TAKE STEPS TO THIS END VIS-A-VIS THE PARTIES INVOLVED .

17 IT FOLLOWS FROM THIS THAT THE POSITION OF THE MEMBER STATES AND OF THEIR AUTHORITIES WHICH ARE PARTIES TO THE LEGAL PROCEEDINGS IN RELATION TO THE REIMBURSEMENT OF COMMUNITY REVENUE EVADED SUMS IMPROPERLY PAID, HAS NOT BEEN AFFECTED BY THE CONSEQUENCES OF THE ATTRIBUTION TO THE COMMUNITY OF ITS OWN RESOURCES .

18 PART ( B ) OF THE QUESTION, HAVING BEEN ASKED ONLY IN THE EVENT OF AN AFFIRMATIVE ANSWER TO PART ( A ), HAS THEREFORE BECOME POINTLESS .

19 THE FIRST QUESTION HAS LIKEWISE BECOME POINTLESS SINCE A NEGATIVE ANSWER GIVEN TO THE SECOND QUESTION NECESSARILY INVOLVES A SIMILAR ANSWER BEING GIVEN TO THE FIRST .

20 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES AND BY THE FRENCH GOVERNMENT, WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT, ARE NOT RECOVERABLE AND AS THESE PROCEEDINGS ARE, INSOFAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED, A STEP IN THE ACTION PENDING BEFORE THE HOF VAN BEROEP OF BRUSSELS, THE DECISION AS TO COSTS IS A MATTER FOR THAT COURT .

THE COURT

IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE HOF VAN BEROEP OF BRUSSELS, BY ORDERS OF 26 OCTOBER 1973 AND 31 OCTOBER 1973, HEREBY RULES :

THE POSITION OF THE MEMBER STATES AND OF THEIR NATIONAL AUTHORITIES WHICH ARE PARTIES TO LITIGATION IN RELATION TO THE REIMBURSEMENT OF COMMUNITY REVENUE AVOIDED OR OF SUMS IMPROPERLY PAID HAS NOT BEEN AFFECTED BY THE CONSEQUENCES OF THE ATTRIBUTION TO THE COMMUNITY OF OWN RESOURCES .