61978J0230

1 . AGRICULTURE - COMMON AGRICULTURAL POLICY - REGULATIONS - PROCEDURE FOR FORMULATION - DISTINCTION BETWEEN BASIC REGULATIONS AND IMPLEMENTING REGULATIONS

( EEC TREATY , ART . 43 )

2 . AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - SUGAR -SYSTEM OF QUOTAS - ALTERATION OF BASIC QUOTAS - MEMBER STATE ' S POWER RECOGNIZED - LAWFULNESS - CONDITIONS

( REGULATION NO 3330/74 OF THE COUNCIL , ART . 24 ( 2 ) AND REGULATION NO 3331/74 OF THE COUNCIL , ART . 2 ( 2 ))

3 . ACTS OF THE INSTITUTIONS - REGULATIONS - OBLIGATION TO STATE REASONS - IMPLEMENTING REGULATION - REFERENCE TO THE BASIC REGULATION

( EEC TREATY , ART . 190 )

4 . AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - DISCRIMINATION BETWEEN PRODUCERS OR CONSUMERS IN THE COMMUNITY - CONCEPT

5 . AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - AMENDING REGULATION - VESTED RIGHT OF TRADERS TO CONTINUED ENJOYMENT OF PREVIOUS ADVANTAGES - ABSENCE - INFRINGEMENT OF A FUNDAMENTAL RIGHT - ABSENCE OF SUCH INFRINGEMENT

6 . AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - SUGAR - SYSTEM OF QUOTAS - ALTERATION OF BASIC QUOTAS - RESTRUCTURING PLANS - CONCEPT - DEFINITION - CRITERIA

( REGULATION NO 3331/74 OF THE COUNCIL , ART . 2 ( 2 ))

7 . AGRICULTURE - COMMON ORGANIZATION OF THE MARKETS - SUGAR - SYSTEM OF QUOTAS - ALTERATION OF BASIC QUOTAS - MEMBER STATE ' S POWER RECOGNIZED - LIMITS

( REGULATION NO 3331/74 OF THE COUNCIL , ART . 2 ( 2 ))

8 . ACTS OF THE INSTITUTIONS - REGULATIONS - DIRECT APPLICABILITY - MEMBER STATE ' S IMPLEMENTING POWER RECOGNIZED - COMPATIBILITY

( EEC TREATY , ART . 189 )

1 . IT CANNOT BE A REQUIREMENT THAT ALL THE DETAILS OF THE REGULATIONS CONCERNING THE COMMON AGRICULTURAL POLICY BE DRAWN UP BY THE COUNCIL ACCORDING TO THE PROCEDURE LAID DOWN IN ARTICLE 43 . IT IS SUFFICIENT FOR THE PURPOSE OF THAT PROVISION THAT THE BASIC ELEMENTS OF THE MATTER TO BE DEALT WITH HAVE BEEN ADOPTED IN ACCORDANCE WITH THAT PROCEDURE ; ON THE OTHER HAND , THE PROVISIONS IMPLEMENTING BASIC REGULATIONS MAY BE ADOPTED BY THE COUNCIL ACCORDING TO A PROCEDURE DIFFERENT FROM THAT UNDER ARTICLE 43 .

2 . ALTHOUGH THE POWER OF THE ITALIAN REPUBLIC PURSUANT TO ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 OF THE COUNCIL , REGARDING THE ALLOCATION AND ALTERATION OF THE BASIC QUOTAS FOR SUGAR , TO ALTER THE BASIC QUOTAS FIXED IN ACCORDANCE WITH ARTICLE 24 OF REGULATION NO 3330/74 IS NOT SUBJECT TO SPECIFIC QUANTITATIVE LIMITS ITS EXERCISE IS NEVERTHELESS SUBJECT TO THE EXISTENCE OF RESTRUCTURING PLANS AND MAY NOT EXCEED WHAT IS NECESSARY FOR THE IMPLEMENTATION OF SUCH PLANS . IN THOSE CIRCUMSTANCES THE POWER IN QUESTION DOES NOT GO BEYOND THE LIMITS OF THE IMPLEMENTATION OF THE PRINCIPLES OF THE BASIC REGULATION NO 3330/74 .

3 . THE OBLIGATION TO STATE REASONS LAID DOWN IN ARTICLE 190 OF THE TREATY IS NOT BREACHED IF THE STATEMENT OF THE REASONS ON WHICH AN IMPLEMENTING REGULATION IS BASED REFERS TO A FACTUAL SITUATION THE DETAILS OF WHICH ARE NOT CONTAINED IN THE STATEMENT OF REASONS SET OUT IN THAT REGULATION BUT IN THAT CONTAINED IN THE BASIC REGULATION .

4 . DISCRIMINATION WITHIN THE MEANING OF THE SECOND SUBPARAGRAPH OF ARTICLE 40 ( 3 ) OF THE TREATY CANNOT OCCUR IF INEQUALITY IN THE TREATMENT OF UNDERTAKINGS CORRESPONDS TO AN INEQUALITY IN THE SITUATIONS OF SUCH UNDERTAKINGS .

5 . AN UNDERTAKING CANNOT CLAIM A VESTED RIGHT TO THE MAINTENANCE OF AN ADVANTAGE WHICH IT OBTAINED FROM THE ESTABLISHMENT OF THE COMMON ORGANIZATION OF THE MARKET AND WHICH IT ENJOYED AT A GIVEN TIME . ACCORDINGLY A REDUCTION IN SUCH AN ADVANTAGE CANNOT BE CONSIDERED AS CONSTITUTING AN INFRINGEMENT OF A FUNDAMENTAL RIGHT .

6 . THE CONCEPT OF ' ' RESTRUCTURING PLANS ' ' WITHIN THE MEANING OF ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 IS TO BE DEFINED BY ITS OBJECTIVES , WHICH ARE TO REDRESS THE IMBALANCE BETWEEN DIFFERENT AGRICULTURAL REGIONS AND TO ADAPT THE SUGAR AND BEET SECTORS IN ITALY TO THE REQUIREMENTS OF THE COMMON ORGANIZATION OF THE MARKET , AND ALSO BY ITS EFFECT , WHICH IS TO ALLOW THE COMPETENT AUTHORITIES TO UNDERTAKE A REDISTRIBUTION OF THE BASIC QUOTAS BETWEEN SEVERAL UNDERTAKINGS .

7 . THE POWER CONFERRED BY ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 TO ALTER THE BASIC QUOTAS IS LIMITED NOT ONLY BY THE REQUIREMENTS OF RESTRUCTURING PLANS BUT ALSO BY THE OBJECTIVES OF THE COMMON ORGANIZATION OF THE MARKET IN SUGAR , IN PARTICULAR BY THE AIM OF PROTECTING THE INTERESTS OF BEET AND CANE PRODUCERS , AND BY THE GENERAL PRINCIPLES OF COMMUNITY LAW .

8 . THE FACT THAT A REGULATION IS DIRECTLY APPLICABLE DOES NOT PREVENT THE PROVISIONS OF THAT REGULATION FROM EMPOWERING A COMMUNITY INSTITUTION OR A MEMBER STATE TO TAKE IMPLEMENTING MEASURES . IN THE LATTER CASE THE DETAILED RULES FOR THE EXERCISE OF THAT POWER ARE GOVERNED BY THE PUBLIC LAW OF THE MEMBER STATE IN QUESTION ; HOWEVER , THE DIRECT APPLICABILITY OF THE MEASURE EMPOWERING THE MEMBER STATE TO TAKE THE NATIONAL MEASURES IN QUESTION WILL MEAN THAT THE NATIONAL COURTS MAY ASCERTAIN WHETHER SUCH NATIONAL MEASURES ARE IN ACCORDANCE WITH THE CONTENT OF THE COMMUNITY REGULATION .

IN CASE 230/78

REFERENCE TO THE COURT PURSUANT TO ARTICLE 177 OF THE EEC TREATY BY THE THIRD CHAMBER OF THE TRIBUNALE AMMINISTRATIVO REGIONALE ( REGIONAL ADMINISTRATIVE COURT ) OF LATIUM FOR A PRELIMINARY RULING IN THE PROCEEDINGS PENDING BEFORE THAT COURT BETWEEN

S.P.A . ERIDANIA-ZUCCHERIFICI NAZIONALI , GENOA , AND

S.P.A . SOCIETA ITALIANA PER L ' INDUSTRIA DEGLI ZUCCHERI , ROME

AND

MINISTER OF AGRICULTURE AND FORESTRY ,

MINISTER FOR INDUSTRY , TRADE AND CRAFT TRADES , AND

S.P.A . ZUCCHERIFICI MERIDIONALI

ON THE VALIDITY AND INTERPRETATION OF ARTICLE 2 ( 2 ) OF REGULATION ( EEC ) NO 3331/74 OF THE COUNCIL OF 19 DECEMBER 1974 ( OFFICIAL JOURNAL 1974 , L 359 , P . 18 ), ON THE ALLOCATION AND ALTERATION OF THE BASIC QUOTAS FOR SUGAR ,

1 BY AN ORDER OF 3 JULY 1978 WHICH WAS RECEIVED AT THE COURT OF JUSTICE ON 16 OCTOBER 1978 , THE TRIBUNALE AMMINISTRATIVO REGIONALE OF LATIUM REFERRED A NUMBER OF QUESTIONS TO THE COURT UNDER ARTICLE 177 OF THE EEC TREATY CONCERNING THE VALIDITY AND INTERPRETATION OF REGULATION NO 3331/74 OF THE COUNCIL OF 19 DECEMBER 1974 ON THE ALLOCATION AND ALTERATION OF THE BASIC QUOTAS FOR SUGAR ( OFFICIAL JOURNAL 1974 , L 359 , P . 18 ).

2 THESE QUESTIONS WERE RAISED IN THE COURSE OF PROCEEDINGS INSTITUTED BY THE UNDERTAKING ' ' ERIDANIA ZUCCHERIFICI NAZIONALI ' ' FOR THE ANNULMENT OF A DECREE ISSUED JOINTLY BY THE ITALIAN MINISTER OF AGRICULTURE AND FORESTRY AND THE MINISTER FOR INDUSTRY , TRADE AND CRAFT TRADES ALTERING THE BASIC SUGAR QUOTAS PURSUANT TO ARTICLE 2 ( 2 ) OF THE SAID REGULATION NO 3331/74 .

3 IN SUPPORT OF ITS ACTION ERIDANIA ARGUED THAT THE CONTESTED DECREE WAS UNLAWFUL FOR VARIOUS REASONS , AMONG WHICH IT CITED THE UNLAWFULNESS OF ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 , WHICH CONSTITUTES THE BASIS IN LAW OF THE CONTESTED DECREE , AND THE MISAPPLICATION OF THAT PROVISION BY THE ITALIAN MINISTERS .

4 IN ORDER TO RESOLVE THE PROBLEMS OF COMMUNITY LAW WHICH WERE THUS RAISED THE TRIBUNALE AMMINISTRATIVO SUBMITTED SEVEN QUESTIONS TO THE COURT . FOUR OF THOSE QUESTIONS CONCERN THE VALIDITY OF REGULATION NO 3331/74 , AND IN PARTICULAR ARTICLE 2 ( 2 ) THEROF , WHILST THE OTHERS RELATE TO THE INTERPRETATION OF THAT PROVISION .

VALIDITY

QUESTION 1 ( CONSULTATION WITH THE EUROPEAN PARLIAMENT )

5 IN THE FIRST QUESTION THE TRIBUNALE ASKS WHETHER THE PRIOR CONSULTATION WITH THE ASSEMBLY PRESCRIBED IN ARTICLE 43 ( 2 ) OF THE TREATY WAS IMPROPERLY OMITTED IN THE PROCEDURE FOLLOWED FOR THE ADOPTION OF ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 .

6 THE ALLOCATION TO UNDERTAKINGS OF BASIC QUOTAS FOR THE 1975/76 TO 1979/80 SUGAR MARKETING YEARS FORMS THE SUBJECT-MATTER OF THE PROVISIONS OF ARTICLE 24 OF REGULATION ( EEC ) NO 3330/74 OF THE COUNCIL OF 19 DECEMBER 1974 , ON THE COMMON ORGANIZATION OF THE MARKET IN SUGAR ( OFFICIAL JOURNAL 1974 , L 359 , P . 1 ). THOSE PROVISIONS REQUIRE THE MEMBER STATES TO EFFECT THAT ALLOCATION WITHIN THE FRAMEWORK OF A BASIC QUANTITY FIXED FOR EACH MEMBER STATE AND IN ACCORDANCE WITH CERTAIN CRITERIA WHICH ARE BASED IN PARTICULAR ON THE ' ' REFERENCE OUTPUT ' ' OF THE UNDERTAKINGS IN QUESTION , THAT IS TO SAY , THEIR AVERAGE ANNUAL SUGAR OUTPUT FOR THE 1968/69 TO 1972/73 MARKETING YEARS MULTIPLIED BY A CERTAIN COEFFICIENT ; HOWEVER , THE PROVISIONS IN QUESTION SPECIFY CERTAIN CASES IN WHICH DIFFERENT CRITERIA MAY BE APPLIED . FURTHERMORE , ARTICLE 24 ( 3 ) PROVIDES THAT ' ' THAT COUNCIL , ACTING BY A QUALIFIED MAJORITY ON A PROPOSAL FROM THE COMMISSION , SHALL ADOPT THE GENERAL RULES FOR THE APPLICATION OF THIS ARTICLE AND ANY DEROGATIONS THEREFROM ' ' . IT SHOULD BE NOTED THAT IN THE COURSE OF DRAWING UP BASIC REGULATION NO 3330/74 THE VIEWS OF THE ASSEMBLY WERE HEARD ON THE DRAFT OF THOSE PROVISIONS .

7 REGULATION NO 3331/74 WAS ADOPTED IN PURSUANCE OF ARTICLE 24 ( 3 ) OF THE BASIC REGULATION AND IN ACCORDANCE WITH THE PROCEDURE PRESCRIBED THEREIN ; THAT PROCEDURE DIFFERS FROM THE PROCEDURE PRESCRIBED IN ARTICLE 43 OF THE TREATY . HOWEVER , AS THE COURT HAS ALREADY HELD IN ITS JUDGMENT OF 17 DECEMBER 1970 ( CASE 25/70 KOSTER , ( 1970 ) ECR 1161 ) IT CANNOT BE A REQUIREMENT THAT ALL THE DETAILS OF THE REGULATIONS CONCERNING THE COMMON AGRICULTURAL POLICY BE DRAWN UP BY THE COUNCIL ACCORDING TO THE PROCEDURE LAID DOWN IN ARTICLE 43 ; IT IS SUFFICIENT FOR THE PURPOSES OF THAT PROVISION THAT THE BASIC ELEMENTS OF THE MATTER TO BE DEALT WITH HAVE BEEN ADOPTED IN ACCORDANCE WITH THAT PROCEDURE ; ON THE OTHER HAND , THE PROVISIONS IMPLEMENTING BASIC REGULATIONS MAY BE ADOPTED BY THE COUNCIL ACCORDING TO A PROCEDURE DIFFERENT FROM THAT UNDER ARTICLE 43 .

8 CONSEQUENTLY IT WAS LAWFUL FOR THE COUNCIL TO ENACT AN IMPLEMENTING REGULATION IN ACCORDANCE WITH THE PROCEDURE REFERRED TO IN ARTICLE 24 ( 3 ) OF REGULATION NO 3330/74 WHICH CONSTITUTES THE BASIC REGULATION FOR THE MARKET IN SUGAR . THAT OUTCOME IS NOT AFFECTED BY THE SOLE FACT THAT ARTICLE 24 ( 3 ) EMPOWERS THE COUNCIL NOT ONLY TO ENACT IMPLEMENTING MEASURES BUT ALSO TO DETERMINE ANY ' ' DEROGATIONS ' ' FROM THE PROVISIONS OF THE BASIC REGULATION , WHICH WORD MUST BE UNDERSTOOD IN THIS CONTEXT AS NECESSARILY REFERRING TO DEROGATIONS WHICH RELATE TO THE GENERAL SYSTEM FOR THE ALLOCATION OF QUOTAS PROVIDED FOR BY THE BASIC REGULATION AND WHICH DO NOT JEOPARDIZE THE ESSENTIAL ELEMENTS EMBODIED IN THAT REGULATION .

9 THE FIRST QUESTION SUBMITTED BY THE NATIONAL COURT THUS AMOUNTS TO ASKING WHETHER IN THE PRESENT CASE THE PROVISIONS OF REGULATION NO 3331/74 AND IN PARTICULAR ARTICLE 2 ( 2 ) THEREOF WHICH WERE ENACTED ON THE BASIS OF THE ABOVE-MENTIONED ARTICLE 24 ( 3 ) DO NOT GO BEYOND THE LIMITS OF THE IMPLEMENTATION OF THE PRINCIPLES OF THE BASIC REGULATION .

10 THE DOUBTS SET OUT IN THIS CONNEXION BY THE TRIBUNALE AMMINISTRATIVO STEM IN PARTICULAR FROM THE DEROGATIONS CONTAINED IN ARTICLE 2 OF REGULATION NO 3331/74 . ACCORDING TO ARTICLE 2 ( 1 ) MEMBER STATES MAY REDUCE THE BASIC QUOTAS FIXED IN ACCORDANCE WITH ARTICLE 24 OF REGULATION NO 3330/74 BY AN AMOUNT NOT EXCEEDING 5% ; PARAGRAPH ( 2 ) PROVIDES THAT THE ITALIAN REPUBLIC MAY ' ' ALTER ' ' THE SAME QUOTAS ' ' IN SO FAR AS IS NECESSARY FOR THE IMPLEMENTATION OF RESTRUCTURING PLANS FOR THE BEET AND SUGAR SECTORS ' ' .

11 ALTHOUGH THE POWER OF THE ITALIAN REPUBLIC TO ALTER THOSE QUOTAS PURSUANT TO ARTICLE 2 ( 2 ) IS NOT SUBJECT TO SPECIFIC QUANTITATIVE LIMITS ITS EXERCISE IS NEVERTHELESS SUBJECT TO THE EXISTENCE OF RESTRUCTURING PLANS - WHICH , AS THE LAST SENTENCE OF THE PROVISION STATES , MUST BE SUBMITTED TO THE COMMISSION FOR ITS OPINION BEFORE 1 JULY 1978 - AND SUCH EXERCISE MAY NOT EXCEED WHAT IS NECESSARY FOR THE IMPLEMENTATION OF SUCH PLANS . THE EXERCISE OF THAT POWER IS THUS SUBJECT TO CLEARLY SPECIFIED LIMITATIONS .

12 IT SHOULD BE REMARKED IN THIS CONNEXION THAT THE POWER IN QUESTION CORRESPONDS TO A CONCERN WHICH WAS ALREADY EXPRESSED IN THE BASIC REGULATION . THE LATTER MAKES PROVISION FOR THE TEMPORARY GRANTING BY ITALY OF ADAPTATION AID TO BEET AND CANE PRODUCERS AND THE STATEMENT OF REASONS FOR SUCH EXCEPTIONAL ARRANGEMENTS REFERS TO THE PARTICULAR SITUATION OF ITALY WHERE THE PRODUCTION OF SUCH PRODUCTS IS ADVERSELY AFFECTED OWING TO CLIMATIC REASONS AND , MORE PARTICULARLY AS REGARDS BEET PRODUCTION , BY DIFFICULTIES ARISING FROM THE APPLICATION OF MODERN PRODUCTION TECHNIQUES .

13 THE POWER REFERRED TO IN ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 THUS COMES WITHIN THE SCOPE OF AN OBJECTIVE LAID DOWN BY THE BASIC REGULATION ; IT IS LIMITED BY THE REQUIREMENTS ENTAILED BY THAT OBJECTIVE WHICH WERE TO BE SET OUT IN DETAIL BY THE ITALIAN REPUBLIC IN THE RESTRUCTURING PLANS SUBMITTED TO THE COMMISSION . IN THOSE CIRCUMSTANCES THE POWER IN QUESTION DOES NOT GO BEYOND THE LIMITS OF THE IMPLEMENTATION OF THE PRINCIPLES OF THE BASIC REGULATION .

QUESTION 2 ( LACK OF A STATEMENT OF REASONS )

14 IN ITS SECOND QUESTION THE TRIBUNALE AMMINISTRATIVO ASKS THE COURT WHETHER , IN ADOPTING REGULATION NO 3331/74 , THE COUNCIL FULFILLED THE DUTY CONTAINED IN ARTICLE 190 OF THE TREATY REQUIRING REASONS TO BE STATED , AND INDEED SUFFICIENTLY STATED .

15 IN THE STATEMENT OF REASONS FOR REGULATION NO 3331/74 THE COUNCIL MERELY REFERRED TO THE POSSIBILITY GIVEN TO THE ITALIAN REPUBLIC OF ALTERING THE BASIC QUOTAS ON THE BASIS OF RESTRUCTURING PLANS ' ' IN VIEW OF ITS SPECIAL SITUATION IN THIS SECTOR ' ' . THE QUESTION OF THE RESPECT IN WHICH THAT SITUATION IS SPECIAL IS NOT ANSWERED IN THE STATEMENT OF REASONS SET OUT IN THAT REGULATION BUT IN THAT CONTAINED IN THE BASIC REGULATION TO WHICH REFERENCE HAS ALREADY BEEN MADE .

16 IN VIEW OF THE CLOSE CONNEXION WHICH EXISTS BETWEEN THE BASIC REGULATION AND THE REGULATION ADOPTED IN IMPLEMENTATION THEREOF SUCH A MEANS OF STATING THE REASONS FOR THE DETAILED RULES SPECIFICALLY PERTAINING TO THE COMMON ORGANIZATION OF THE MARKET IN SUGAR IN ITALY MUST BE PERMITTED . IT MAKES SUFFICIENTLY CLEAR TO THE COMPETENT AUTHORITIES AND TO THE RELEVANT UNDERTAKINGS THE CONCERN WHICH PROMPTED THE COUNCIL TO ENACT THOSE DETAILED RULES AND THE OBJECTIVES WHICH MUST BE PURSUED IN THE RESTRUCTURING PLANS .

QUESTION 3 ( DISCRIMINATION )

17 THE THIRD QUESTION IS BASED ON THE VIEW THAT , APART FROM THE POSSIBILITY OF A REDUCTION OF 5% IN THE BASIC QUOTAS PRESCRIBED FOR THE UNDERTAKINGS OF ALL THE MEMBER STATES , ONLY ITALIAN PRODUCERS ARE LIABLE TO BE AFFECTED UNDER ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 BY AN ADDITIONAL LIMITATION OF THEIR ACTIVITY . THE TRIBUNALE AMMINISTRATIVO ASKS WHETHER THE FACT THAT THE ITALIAN INDUSTRY ALONE IS EXPOSED TO THE RISK OF SUCH A REDUCTION DOES NOT CONSTITUTE AN INFRINGEMENT OF THE PROHIBITION OF DISCRIMINATION BETWEEN PRODUCERS WITHIN THE COMMUNITY LAID DOWN IN ARTICLE 40 ( 3 ) OF THE TREATY .

18 DISCRIMINATION WITHIN THE MEANING OF ARTICLE 40 OF THE TREATY CANNOT OCCUR IF INEQUALITY IN THE TREATMENT OF UNDERTAKINGS CORRESPONDS TO AN INEQUALITY IN THE SITUATIONS OF SUCH UNDERTAKINGS . IT IS COMMONLY ACCEPTED THAT THE SITUATION IN THE BEET AND SUGAR SECTORS IN ITALY DIFFERS APPRECIABLY FROM THAT IN THE OTHER MEMBER STATES . THE SPECIAL SITUATION OF ITALY REFERRED TO IN THE PREAMBLES TO REGULATIONS NOS 3330/74 AND 3331/74 HAS OCCASIONED SPECIAL MEASURES INTENDED TO IMPROVE THE STRUCTURE OF THE ECONOMY IN THE BEET AND SUGAR SECTORS IN ITALY AS A WHOLE . IN CERTAIN RESPECTS THE ITALIAN UNDERTAKINGS ENJOY MORE FAVOURABLE ARRANGEMENTS THAN UNDERTAKINGS IN THE OTHER MEMBER STATES , FOR EXAMPLE WITH REGARD TO THE SYSTEM OF AIDS ; IN OTHER RESPECTS CERTAIN ITALIAN UNDERTAKINGS SUFFER THE DISADVANTAGES OF THE SPECIAL SITUATION OF ITALY , FOR EXAMPLE IN THE CASE OF THE REDUCTION IN THEIR BASIC QUOTAS IN FAVOUR OF AN INCREASE IN THE BASIC QUOTAS OF OTHER UNDERTAKINGS ON THE BASIS OF THE RESTRUCTURING PLANS .

19 SUCH DIFFERENCES IN TREATMENT ARE THUS BASED ON OBJECTIVE DIFFERENCES ARISING FROM THE UNDERLYING ECONOMIC SITUATIONS ; THEY CANNOT BE CONSIDERED DISCRIMINATORY .

QUESTION 4 ( FUNDAMENTAL RIGHTS )

20 THE FOURTH QUESTION IS BASED ON THE VIEW THAT THE CARRYING ON OF ECONOMIC ACTIVITIES MUST BE GUARANTEED BECAUSE IT FORMS PART OF THE FUNDAMENTAL RIGHTS WHICH COMMUNITY LAW IS ALSO CONCERNED TO UPHOLD . THAT GUARANTEE IS SAID TO EXTEND TO THE RIGHT OF UNDERTAKINGS TO PRODUCE THE QUANTITIES OF SUGAR CORRESPONDING TO THEIR BASIC QUOTAS SINCE THAT RIGHT IS INHERENT IN THE CARRYING ON OF ECONOMIC ACTIVITY . THIS IS THE VIEW WHICH PROMPTED THE TRIBUNALE AMMINISTRATIVO TO RAISE THE QUESTION WHETHER POWER TO ALTER THE BASIC QUOTAS IN THE CIRCUMSTANCES SET OUT IN ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 DOES NOT JEOPARDIZE THE CARRYING ON OF ECONOMIC ACTIVITY BY THE UNDERTAKINGS CONCERNED AND THEREBY INFRINGE THEIR FUNDAMENTAL RIGHTS .

21 THE REPLY TO THAT QUESTION MUST BE GIVEN ON THE BASIS OF AN EXAMINATION OF THE NATURE OF THE BASIC QUOTAS LAID DOWN BY THE COMMUNITY RULES . THE QUOTAS SPECIFY THE QUANTITIES OF SUGAR IN RESPECT OF WHICH THE UNDERTAKINGS ENJOY THE GUARANTEES AS TO PRICE AND MARKETING PROVIDED FOR PRODUCERS IN THE CONTEXT OF THE COMMON ORGANIZATION OF THE MARKET . THEY DO NOT RESTRICT THE ECONOMIC ACTIVITY OF THE UNDERTAKINGS IN QUESTION BUT FIX THE QUANTITIES OF PRODUCTION WHICH MAY BE MARKETED IN ACCORDANCE WITH THE SPECIAL ARRANGEMENTS ESTABLISHED BY THE COMMON ORGANIZATION OF THE MARKET IN SUGAR TO PROTECT AND ASSIST THE PRODUCTION OF SUGAR IN THE COMMUNITY . IT IS AN ESSENTIAL FEATURE OF THAT ORGANIZATION OF THE MARKET THAT IT IS VARIABLE IN TERMS OF THE ECONOMIC FACTORS WHICH AFFECT THE DEVELOPMENT OF THE MARKET AND IN TERMS OF THE GENERAL DIRECTION OF THE COMMON AGRICULTURAL POLICY .

22 IT FOLLOWS THAT AN UNDERTAKING CANNOT CLAIM A VESTED RIGHT TO THE MAINTENANCE OF AN ADVANTAGE WHICH IT OBTAINED FROM THE ESTABLISHMENT OF THE COMMON ORGANIZATION OF THE MARKET AND WHICH IT ENJOYED AT A GIVEN TIME . IN THOSE CIRCUMSTANCES A REDUCTION IN SUCH AN ADVANTAGE CANNOT BE CONSIDERED AS CONSTITUTING AN INFRINGEMENT OF A FUNDAMENTAL RIGHT .

23 WITH REGARD TO THE FIRST FOUR QUESTIONS THE REPLY MUST BE THAT CONSIDERATION OF THOSE QUESTIONS HAS DISCLOSED NO FACTOR OF SUCH A KIND AS TO AFFECT THE VALIDITY OF REGULATION NO 3331/74 , AND IN PARTICULAR ARTICLE 2 ( 2 ) THEREOF .

INTERPRETATION

QUESTION 5 ( RESTRUCTURING PLANS )

24 THE TRIBUNALE AMMINISTRATIVO ASKS IN THE FIFTH QUESTION WHETHER REGULATION NO 3331/74 OR COMMUNITY LAW IN GENERAL LAY DOWN SPECIFIC CRITERIA FOR THE APPRAISAL OF CONCEPT OF ' ' RESTRUCTURING PLANS ' ' .

25 IT SHOULD BE NOTED FIRST OF ALL THAT THE RESTRUCTURING PLANS FORM PART OF THE COMMON ORGANIZATION OF THE MARKET IN SUGAR AND THAT THEY ARE ACCORDINGLY AN ELEMENT OF THE COMMON AGRICULTURAL POLICY AS A WHOLE , THE OBJECTIVES OF WHICH ARE FIXED BY ARTICLE 39 ( 1 ) OF THE TREATY . ARTICLE 39 ( 2 ) STATES THAT IN WORKING OUT THE COMMON AGRICULTURAL POLICY AND THE SPECIAL METHODS FOR ITS APPLICATION ACCOUNT SHALL BE TAKEN OF THE PARTICULAR NATURE OF AGRICULTURAL ACTIVITY , WHICH RESULTS FROM THE SOCIAL STRUCTURE OF AGRICULTURE AND FROM STRUCTURAL AND NATURAL DISPARITIES BETWEEN THE VARIOUS AGRICULTURAL REGIONS AND THE NEED TO EFFECT THE APPROPRIATE ADJUSTMENTS BY DEGREES . THE PRACTICE OF THE COMMUNITY INSTITUTIONS , WITH REGARD FOR EXAMPLE TO THE APPLICATION OF ARTICLES 92 AND 93 OF THE TREATY , SHOWS THAT RESTRUCTURING PLANS CONSTITUTE A USUAL AND ADEQUATE METHOD FOR EFFECTING THE ABOVE-MENTIONED ADJUSTMENTS BY DEGREES . HAVING REGARD TO THE WIDELY-ACCEPTED EXTENT OF THE DISPARITIES BETWEEN THE VARIOUS AGRICULTURAL REGIONS IN ITALY THOSE CONSIDERATIONS MUST FORM THE BACKGROUND TO THE EXAMINATION OF THE CONCEPT OF ' ' RESTRUCTURING PLANS ' ' WHICH IS EMPLOYED IN REGULATION NO 3331/74 .

26 SECONDLY , IT IS CLEAR FROM THE PROVISIONS AS A WHOLE REGULATIONS NOS 3330/74 AND 3331/74 CONCERNING THE SYSTEM OF QUOTAS THAT , ON THE ONE HAND , A RESTRUCTURING PLAN HAS AS ITS OBJECTIVE THE ADAPTATION OF THE SUGAR AND BEET SECTORS IN ITALY TO THE REQUIREMENTS OF THE COMMON ORGANIZATION OF THE MARKET IN SUCH A WAY THAT SPECIAL ARRANGEMENTS FOR THAT SECTOR IN ITALY WILL NO LONGER BE NECESSARY IN FUTURE AND THAT , ON THE OTHER , A RESTRUCTURING PLAN MUST BE OF SUCH A KIND AS TO PERMIT THE COMPETENT ITALIAN AUTHORITIES AND THE COMMISSION TO ASSESS WHAT ALTERATIONS TO THE BASIC QUOTAS OF THE SUGAR UNDERTAKINGS ARE NECESSARY IN ORDER TO ATTAIN THAT OBJECTIVE .

27 THOSE FACTORS AS A WHOLE SHOW THAT THE CONCEPT OF ' ' RESTRUCTURING PLANS ' ' MAY REFER BOTH TO A COMPREHENSIVE PLAN FOR ADJUSTING THE SUGAR MARKET AS A WHOLE AND TO A PLAN FOR ADJUSTMENTS WHOSE EFFECTS ARE PURELY REGIONAL EVEN IF , IN THE CONTEXT OF A GRADUAL ADJUSTMENT OF BEET PRODUCTION IN A CERTAIN REGION , THAT PLAN INITIALLY CONCERNS A SINGLE SUGAR UNDERTAKING ALONE .

28 THE REPLY TO THE FIFTH QUESTION MUST ACCORDINGLY BE THAT THE CONCEPT OF ' ' RESTRUCTURING PLANS ' ' WITHIN THE MEANING OF ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 IS TO BE DEFINED BY ITS OBJECTIVES , WHICH ARE TO REDRESS THE IMBALANCE BETWEEN DIFFERENT AGRICULTURAL REGIONS AND TO ADAPT THE SUGAR AND BEET SECTORS IN ITALY TO THE REQUIREMENTS OF THE COMMON ORGANIZATION OF THE MARKET , AND ALSO BY ITS EFFECT , WHICH IS TO ALLOW THE COMPETENT AUTHORITIES TO UNDERTAKE A REDISTRIBUTION OF THE BASIC QUOTAS BETWEEN SEVERAL UNDERTAKINGS .

QUESTION 6 ( DISCRETIONARY POWER )

29 IN THE SIXTH QUESTION THE TRIBUNALE AMMINISTRATIVO ASKS WHETHER THE LIMITS TO THE POWER TO ALTER THE BASIC QUOTAS OF THE UNDERTAKINGS DERIVE EXCLUSIVELY FROM THE NECESSITY TO IMPLEMENT THE RESTRUCTURING PLANS OR WHETHER OTHER LIMITS CAN BE DISCERNED .

30 IT SHOULD BE NOTED FIRST OF ALL THAT THE SYSTEM OF QUOTAS FORMS AN INTEGRAL PART OF THE COMMON ORGANIZATION OF THE MARKET IN SUGAR WHICH , ACCORDING TO THE BASIC REGULATION , IS INTENDED TO ENSURE THAT THE NECESSARY GUARANTEES IN RESPECT OF EMPLOYMENT AND STANDARDS OF LIVING ARE MAINTAINED FOR COMMUNITY GROWERS OF SUGAR BEET AND SUGAR CANE . VARIOUS PROVISIONS OF REGULATION NO 3331/74 , SUCH AS ARTICLE 3 AND ARTICLE 4 ( 2 ), ARE ALSO PROMPTED BY THE WISH TO PROTECT THE INTEREST OF SUCH PRODUCERS . THE STATEMENT OF REASONS FOR THAT REGULATION REFERS TO THE NEED TO PREVENT ALTERATIONS IN THE BASIC QUOTAS FROM JEOPARDIZING THOSE INTERESTS .

31 THE AUTHORITIES WHICH HAVE POWER TO ALTER THE BASIC QUOTAS MUST , IN ORDER TO OBSERVE THE GENERAL PRINCIPLES OF COMMUNITY LAW WHICH ARE BINDING ON ALL AUTHORITIES ENTRUSTED WITH THE IMPLEMENTATION OF COMMUNITY PROVISIONS , RENCONCILE PROTECTION OF THE INTERESTS OF BEET AND CANE PRODUCERS WITH OTHER LAWFUL INTERESTS WHICH MAY BE AFFECTED . IN FACT ARTICLE 39 OF THE TREATY , WHICH FIXES THE OBJECTIVES OF THE COMMON AGRICULTURAL POLICY , EXPRESSES THE DESIRE NOT ONLY TO ENSURE A FAIR STANDARD OF LIVING FOR THE AGRICULTURAL COMMUNITY BUT ALSO TO INCREASE AGRICULTURAL PRODUCTIVITY , STABILIZE MARKETS , ASSURE THE AVAILABILITY OF SUPPLIES AND ENSURE THAT SUPPLIES REACH CONSUMERS AT REASONABLE PRICES .

32 THE REPLY TO THE SIXTH QUESTION MUST ACCORDINGLY BE THAT THE POWER CONFERRED BY ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 TO ALTER THE BASIC QUOTAS IS LIMITED NOT ONLY BY THE REQUIREMENTS OF RESTRUCTURING PLANS BUT ALSO BY THE OBJECTIVES OF THE COMMON ORGANIZATION OF THE MARKET IN SUGAR , IN PARTICULAR BY THE AIM OF PROTECTING THE INTERESTS OF BEET AND CANE PRODUCERS , AND BY THE GENERAL PRINCIPLES OF COMMUNITY LAW .

QUESTION 7 ( DIRECT APPLICABILITY )

33 THE SEVENTH QUESTION RAISES THE PROBLEM OF WHETHER THE DIRECT APPLICABILITY OF REGULATION NO 3331/74 WITHIN THE ITALIAN LEGAL ORDER PURSUANT TO ARTICLE 189 OF THE TREATY IS COMPATIBLE WITH THE PROVISIONS ENACTED BY THE ITALIAN AUTHORITIES INTENDED TO GOVERN THE IMPLEMENTATION OF THAT REGULATION .

34 THE FACT THAT A REGULATION IS DIRECTLY APPLICABLE DOES NOT PREVENT THE PROVISIONS OF THAT REGULATION FROM EMPOWERING A COMMUNITY INSTITUTION OR A MEMBER STATE TO TAKE IMPLEMENTING MEASURES . IN THE LATTER CASE THE DETAILED RULES FOR THE EXERCISE OF THAT POWER ARE GOVERNED BY THE PUBLIC LAW OF THE MEMBER STATE IN QUESTION ; HOWEVER , THE DIRECT APPLICABILITY OF THE MEASURE EMPOWERING THE MEMBER STATE TO TAKE THE NATIONAL MEASURES IN QUESTION WILL MEAN THAT THE NATIONAL COURTS MAY ASCERTAIN WHETHER SUCH NATIONAL MEASURES ARE IN ACCORDANCE WITH THE CONTENT OF THE COMMUNITY REGULATION .

35 THE REPLY TO THE SEVENTH QUESTION MUST ACCORDINGLY BE THAT THERE IS NO INCOMPATIBILITY BETWEEN THE DIRECT APPLICABILITY OF A COMMUNITY REGULATION AND THE EXERCISE OF THE POWER CONFERRED ON A MEMBER STATE TO TAKE IMPLEMENTING MEASURES ON THE BASIS OF THAT REGULATION .

COSTS

36 THE COSTS INCURRED BY THE COUNCIL AND THE COMMISSION AND BY THE GOVERNMENT OF THE ITALIAN REPUBLIC , WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE . AS THESE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN ACTION ARE CONCERNED , IN THE NATURE OF A STEP IN THE ACTION PENDING BEFORE THE NATIONAL COURT , THE DECISION ON COSTS IS A MATTER FOR THAT COURT .

ON THOSE GROUNDS ,

THE COURT ,

IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE THIRD CHAMBER OF THE TRIBUNALE AMMINISTRATIVO REGIONALE , LATIUM , BY AN ORDER OF 3 JULY 1978 , HEREBY RULES :

( 1 ) CONSIDERATION OF THE QUESTIONS RAISED HAS DISCLOSED NO FACTOR OF SUCH A KIND AS TO AFFECT THE VALIDITY OF REGULATION NO 3331/74 , AND IN PARTICULAR ARTICLE 2 ( 2 ) THEREOF .

( 2 ) THE CONCEPT OF ' ' RESTRUCTURING PLANS ' ' WITHIN THE MEANING OF ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 IS TO BE DEFINED BY ITS OBJECTIVES , WHICH ARE TO REDRESS THE IMBALANCE BETWEEN DIFFERENT AGRICULTURAL REGIONS AND TO ADAPT THE SUGAR AND BEET SECTORS IN ITALY TO THE REQUIREMENTS OF THE COMMON ORGANIZATION OF THE MARKET , AND ALSO BY ITS EFFECT , WHICH IS TO ALLOW THE COMPETENT AUTHORITIES TO UNDERTAKE A REDISTRIBUTION OF THE BASIC QUOTAS BETWEEN SEVERAL UNDERTAKINGS .

( 3 ) THE POWER CONFERRED BY ARTICLE 2 ( 2 ) OF REGULATION NO 3331/74 TO ALTER THE BASIC QUOTAS IS LIMITED NOT ONLY BY THE REQUIREMENTS OF RESTRUCTURING PLANS BUT ALSO BY THE OBJECTIVES OF THE COMMON ORGANIZATION OF THE MARKET IN SUGAR , IN PARTICULAR BY THE AIM OF PROTECTING THE INTERESTS OF BEET AND CANE PRODUCERS , AND BY THE GENERAL PRINCIPLES OF COMMUNITY LAW .

( 4 ) THERE IS NO INCOMPATIBILITY BETWEEN THE DIRECT APPLICABILITY OF A COMMUNITY REGULATION AND THE EXERCISE OF THE POWER CONFERRED ON A MEMBER STATE TO TAKE IMPLEMENTING MEASURES ON THE BASIS OF THAT REGULATION .