61994C0285

1 In these proceedings the Italian Republic seeks the annulment of Commission Regulation (EC) No 1840/94 of 27 July 1994 fixing the olive yields and oil yields for the marketing year 1993/94 (1) (hereinafter `the Regulation').

2 In essence the issue is whether, when fixing those yields, the Commission must rely on the figures supplied by the authorities of each Member State (as argued by the Italian Government) or whether, on the contrary, it may depart from them (as claimed by the Commission), as it did in the contested Regulation.

3 The grounds adduced by the Italian Government for seeking the annulment of the Regulation are, essentially, as follows:

- The Commission contravened the Community provisions regulating the fixing of olive and olive oil yields by not adhering to the production figures supplied by Italy, and therefore infringed the principle of legal certainty.

- The Regulation does not state the grounds on which it is based, or states totally inappropriate grounds.

- The Commission misused its powers in adopting the Regulation.

Legislative context

4 The basic legislative background to the present case is as follows:

(a) a first regulation (Council Regulation No 136/66/EEC of 22 September 1966 on the establishment of a common organization of the market in oils and fats) (2) provides for the grant of aid to producers;

(b) an implementing regulation (Council Regulation (EEC) No 2261/84 of 17 July 1984 laying down general rules on the granting of aid for the production of olive oil and of aid to olive oil producer organizations) (3) lays down the legislative framework for such aid;

(c) later annual regulations specify for each marketing year:

- the forecast production and the aid which may be paid in advance;

- the yield of olives and olive oil of each production zone from which the final production is derived.

5 Regulation No 136/66 introduced, among other measures, a subsidy intended to ensure for Community producers `a fair income, the level of which may be determined by a production target price in the case of olive oil and, in the case of oil seeds, by a target price [...]. The difference between these prices and prices acceptable to the consumer represents the subsidy which should be granted to attain the desired objective.'

6 Under Article 5(2) of Regulation No 136/66, (4) aid is granted to olive growers by one of two alternative methods:

(a) on the basis of the quantity of olive oil actually produced;

(b) on the basis of certain yields fixed according to a flat rate.

7 The first method (actual production) applies to olive growers whose actual production was at least 500 kg of olive oil per marketing year, that is to say, large producers.

8 The second method (presumed production) applies to the others, namely small and medium-scale producers producing less than 500 kg per marketing year. For them, the aid is calculated on the basis of the olive and the oil yields previously determined according to a flat rate having regard to the number of olive trees in production. (5)

9 In the case of large producers, therefore, reference is made to the actual yields. In the case of small and medium-scale producers, the aid does not relate to the actual production of each producer and is calculated on the basis of predetermined figures: the presumed average yield, fixed in advance for each marketing year, is multiplied by the number of olive trees on a particular holding.

10 Regulation No 2261/84 contains the rules for the grant of aid. Article 17a (6) provides as follows:

`1. The Commission shall determine the average olive yields and oil yields over the four previous marketing years, before 1 December in respect of the current marketing year.

2. The following shall be determined in accordance with the procedure laid down in Article 38 of Regulation No 136/66/EEC, before 1 April in respect of the current marketing year:

- estimated production,

- the unit amount of the production aid that can be paid in advance. That amount must be such, under the production conditions of the marketing year in question, as to avoid any risk of unwarranted payment to olive growers.

3. Not more than six months after the end of the marketing year, the following shall be determined in respect of that year in accordance with the procedure referred to in paragraph 2:

- the quantity actually produced in respect of which entitlement to aid has been recognized,

- the unit amount of the production aid provided for under (b) in the fifth subparagraph of Article 5(1) of Regulation No 136/66/EEC, payable to producers whose average production is at least 500 kilograms per marketing year,

- the quantity to be carried over to the next marketing year, if the quantity produced referred to in the first indent is less than the maximum quantity laid down.

4. Member States shall, not later than 15 March, communicate to the Commission their olive oil production estimates for the current marketing year. The Commission may avail itself of other sources of information and, where necessary, have studies or surveys carried out relating to olive oil production.'

11 Article 18 of Regulation No 2261/84 laid down the method for calculating average yields: `[t]he olive yields and oil yields mentioned in the second indent of the first subparagraph of Article 5(2) of Regulation No 136/66/EEC shall be fixed by homogeneous production zones, at the latest by 31 May of each year, on the basis of the figures supplied by producer Member States not later than 30 April of each year'.

12 Council Regulation (EEC) No 2262/84 of 17 July 1984 laying down special measures in respect of olive oil (7) was intended to ensure that the production aid scheme was applied correctly and in a uniform manner after experience had shown that the Member States' administrative structures were inadequate to implement the controls provided for by the Community rules.

13 To that end, Article 1(1) provided that `[e]ach producer Member State shall, in accordance with its legal structure, set up an agency for the purpose of carrying out certain checks and duties in connection with the olive oil production aid scheme'.

14 Article 12 of Commission Regulation (EEC) No 3061/84 of 31 October 1984 laying down detailed rules for the application of the system of production aid for olive oil, (8) provided as follows:

`1. For the purpose of fixing the olive yields and oil yields referred to in Article 18 of Regulation (EEC) No 2261/84, producer Member States shall supply the Commission with data on homogeneous production zones, taking account of:

- the geographical location and the agronomic characteristics of the terrain,

- the predominant varieties, the most common type of shape pruning and the age of the olive trees.

2. For each production zone, the data shall include at least the following:

(a) the geographical limits of the zone;

(b) the estimated area under olives;

(c) the estimated average number of olive trees per hectare of land used for olive growing;

(d) the average olive production per tree;

(e) the average oil production per 100 kilograms of olives.

3. By 30 April each marketing year at the latest, Member States shall forward the data referred to in paragraph 2(b) to (e) together with a short report on production conditions in each zone during the marketing year. (9)

4. For the purpose of establishing oil yields, producer Member States shall determine, at mills equipped in various ways and representative of pressing capacity in the zone in question at various stages of the harvest, the olive-oil yield of each production zone.

For the purpose of establishing olive yields, Member States shall determine, at least for the largest production zones and at the beginning of the marketing year, the olive yields from trees representative of production conditions in the zone.

5. Persons designated by the Commission shall be involved in the determination of the abovementioned data.'

15 Commission Regulation (EC) No 1187/94 of 26 May 1994 fixing the estimated production of olive oil and the amount of the unit production aid that may be paid in advance for the 1993/94 marketing year, (10) provided that for the said year:

the estimated production would be 1 283 000 tonnes,

the unit amount of the production aid that might be paid in advance would be:

- ECU 51.02 per 100 kilograms for Spain and Portugal,

- ECU 67.82 per 100 kilograms for the other Member States.

16 Finally, according to its preamble the Regulation contested in this action purports to apply Article 18 of Regulation No 2261/84, fixing the olive yields and oil yields by homogeneous production zones for the 1993/94 marketing year. Having regard to the figures supplied by the producer Member States, it fixes those yields as specified in Annex I.

17 In particular, with regard to the Italian yields, the preamble to the Regulation adds that `the figures given in Annex I have been adjusted in relation to the information supplied by that Member State, in order to bring them into line with production estimated in Commission Regulation (EC) No 1187/94'.

18 It is precisely the result of that `adjustment' which is challenged by the applicant State because the Commission's figures reduce those proposed by the Italian authorities by approximately 30%. (11)

19 Determination of the average yields (in kilogrammes) of olives for each tree, and of kilogrammes of oil for each 100 kilogrammes of olives, in each of the specified homogeneous zones is the key factor for calculating the final production of the marketing year, as the number of trees is constant. This is confirmed by the document produced by the Italian Government as Annex 3 to its application (`Production of olive oil based on the yields of olives and olive oil for the 1993/94 marketing year').

First plea in law: must the Commission necessarily abide by the figures supplied by the Member States?

20 The first plea in law put forward by the Italian Government in support of its application is that, by virtue of the Community rules which in its opinion are applicable (the fourth indent of Article 155, of the EC Treaty, Article 18 of Regulation No 2261/84, Article 12 of Regulation No 3061/84 and Article 1 of Regulation No 2262/84) and also by virtue of the principle of legal certainty, the Commission is not entitled to depart, as it did from the information supplied by each Member State for the purpose of fixing the average yields of olives and olive oil.

21 It argues that, given that the Council has imposed upon each Member State a duty to set up a specific agency or organization (12) for collecting, verifying and processing, at national level, the data required for ascertaining yields of olives and olive oil, it would not be logical for the Commission to be entitled simply to depart from the final data obtained by such agency and passed to the Community authorities by the various national bodies.

22 The applicant Government adds that the national agencies or organizations (in Italy's case, Agecontrol Spa) work on the basis of a programme previously approved by the Commission, under the supervision of Commission officials and in accordance with its instructions: therefore it would be `contrary to the most fundamental principles of law and common sense' if the Commission were able to disregard their data.

23 On this point the Italian Government's reply discloses a significant shift of position: although not appearing to admit expressly in the original application that this was the case, in its reply to the Commission's defence it acknowledges that the latter has a certain measure of discretion in fixing the average yields. At the hearing too the Italian Government representative stated that he was not disputing the Commission's powers to fix yields, but only the `method' of doing so.

24 According to the Italian Government, such a possibility would arise only if the Commission could show that a Member State's proposal had not been made in accordance with the objective criteria for fixing yields, referred to by Article 12 of Regulation No 3061/84.

25 The reply to this plea in law must, in my opinion, be based on considerations of two kinds. The first relate to the discretion of the Community institutions in the area of the Common Agricultural Policy and market organizations in relation to information supplied by the Member States, and the second to the correct interpretation of the regulations concerned.

(i) Discretion of the Community institutions in the area of the Common Agricultural Policy and market organizations in relation to information supplied by the Member States

26 The case-law of the Court of Justice has upheld the Commission's power to adopt implementing measures in the area of the Common Agricultural Policy and that power must be given a wide interpretation. (13)

27 The reason for this is that the Commission alone is in a position carefully and constantly to keep track of agricultural market trends and to act quickly when necessary. The limits of its powers must be determined by reference to the essential general aims of the market organization. (14)

28 The correctness of the economic data to be used as the basis of subsequent decisions in relation to the various market organizations - and generally of any decision concerning the Common Agricultural Policy - is very important because that policy can be effectively implemented only on the basis of the true figures.

29 For such purposes the Community institutions enjoy a degree of latitude. In Case 138/79 (15) the Court of Justice held that `when the implementation by the Council of the agricultural policy of the Community involves the need to evaluate a complex economic situation, the discretion which it has does not apply exclusively to the nature and scope of the measures to be taken, but also to some extent to the finding of the basic facts'.

30 More recently, in Case C-478/93, cited above, the Court confirmed that the Commission may verify the accuracy of the information supplied by the Member States and correct it if necessary.

31 In that case the Kingdom of the Netherlands made similar allegations to those of the Italian Government in this case. In its opinion, the Commission did not have power to alter the information supplied by the Member States when fixing the reduction coefficient, because the Member States alone could draw up lists of economic operators and fix the reference quantities. (16) According to the Netherlands Government, neither Article 155 of the EC Treaty nor Article 20 of the Regulation establishing the common organization of the market in bananas (17) conferred power on the Commission to alter such calculations unilaterally.

32 The Court rejected that argument, pointing out that, on the contrary, `the role of the Member States in the collection and transmission of information cannot prevent the Commission, which is required to ensure the daily management of the common organization of the markets, from checking the accuracy of that information and revising it if there is a danger that the double counting of quantities may distort the basis of the import system'. (18)

33 Although the facts of that case differed from those of this one, the essence of the Court's reasoning in its judgment in Case C-478/93 is applicable by analogy to the present case. (19) In any event, the final outcome will depend on the roles assigned to the Community institutions and to the Member States in relation to each common market organization.

34 Therefore the special features of the legislature applicable to the common organization of the market in oils and fats and, in particular, the regulations relied upon by the applicant Government must be examined.

(ii) Interpretation of the regulations in issue

35 As already mentioned, Article 18 of Regulation No 2261/84 authorizes the Commission to fix the yields of olives and olive oil `on the basis of the figures supplied by the producer Member States'. (20) When considered in the light of any of the usual methods of judicial interpretation, that phrase does not mean that the Commission is absolutely bound by such figures and cannot therefore depart from them.

36 Construed literally, the phrase `on the basis of' implies a certain degree of independence for the person performing the subsequent action. It means that he acts on a given basis or footing. Therefore the Commission may start from the `basis' of the information supplied by the Member States and then go on to draw its own conclusions.

37 The intrinsic meaning of the provision confirms that Regulation No 2261/84 confers upon the Commission a degree of independence in its decision making. There would be no point in authorizing it to fix certain yields if they had already been irrevocably determined by each Member State. If that were so, there would be no need for action by the Management Committee for Oils and Fats or by the Commission itself and each Member State would have been directly entrusted with definitive determination of the yields.

38 Examination of the purpose of the provision leads to the same conclusion. Under the management of the common organization of the market in oils and fats, which the Regulation entrusts to the Commission in cooperation with the Member States, it is advisable for the former to enjoy a degree of latitude when establishing variable data or factors which, by definition, are to determine the amount of aid to producers.

39 If such aid is to conform with the principles underlying Community policy in this area and if the financial interests of the Community are to be safeguarded, the aid must be based on actual, objective data which, possibly, may not coincide with those supplied by the Member States. Therefore it is logical, and furthermore expedient, for the Commission to examine, verify and weight such data and, as the case may be, other relevant factors which may not have been properly assessed in the proposals submitted by the various national authorities.

40 In fact, as I have pointed out, the applicant Government accepted, in its reply to the Commission's defence and at the hearing, that the latter has a certain discretion to fix yields which differ from the figures proposed by a Member State. According to the applicant, this would in any case require proof that the proposal in question had not correctly applied the criteria laid down by Regulation No 3061/84.

41 I do not share that view. On the contrary, I consider that it is possible - and the present case is a good example - for a national organization to determine its producers' yields using the criteria prescribed for that purpose, but at the same time without taking into account all the potential factors which might affect the calculation of the figures.

42 Article 12 of Regulation No 3061/84 provides that the Member States are to supply the Commission with certain data and to determine olive oil and olive yields for each production zone. But neither that provision nor any of the others which apply prevents the Commission, on examining the data supplied by a Member State in relation to each of the abovementioned factors, from arriving at conclusions different from those reached by the national authorities. (21)

43 To be precise, in my view there are no legal objections to the Commission's departing from the national data if it considers that other factual matters or relevant factors which have not been duly taken into account by the national authorities have a significant impact on the final calculation of olive and olive oil yields.

44 In particular - and this is really the key point in the argument - the Commission may legitimately take as its reference basis the actual situation in the markets over the course of a given marketing year as a factual indicator which accurately reflects upward or downward variations in production volume.

45 That possibility is expressly provided for in Article 17a(4) of Regulation No 2261/84, which provides that the Member States must communicate to the Commission their olive oil production estimates for the current marketing year, and the Commission `may avail itself of other sources of information and, where necessary, have studies or surveys carried out relating to olive oil production'. (22)

46 The Italian Government stresses that other sources of information may be used only in relation to production estimates for a particular year, which is the only situation referred to by Article 17a(4). The same could not be done with regard to the fixing of yields, as Article 12 of Regulation No 3061/84 is silent on that point.

47 I really do not see why the Commission should be able to use information other than that supplied by the Member States only in order to determine the estimated production and not the actual production, the latter being derived from the average yields fixed for homogeneous zones. (23)

48 On the contrary, I consider that if the Commission may use such information with regard to a provisional figure (the estimated production), a fortiori it may take it into account in relation to the final figure (the actual production), especially where the latter has a decisive effect on the management of the common organization of the market.

49 The fact that Article 12 of Regulation No 3061/84 is silent on that point does not seem to me a persuasive argument. Furthermore, as Article 17a of Regulation No 2261/84 (which post-dates Article 12 of Regulation No 3061/84 since it was amended by Regulation No 3500/90) refers to both the estimated production (paragraph 2) and the actual production (paragraph 3). Consequently I see no difficulty in presuming that the last section of Article 17a(4) - the provision authorizing the Commission to use information other than that supplied by the Member States - applies to both calculations of production.

50 Regulation No 1187/94 estimated the global production of olive oil for the Community marketing year 1993/94 at 1 283 000 tonnes, of which 430 000 tonnes would be accounted for by Italy. (24) That figure reduced by almost 200 000 tonnes the forecast submitted by the Italian authorities, prompting a letter of protest dated 2 June 1994 from their Minister for Agriculture, (25) which nevertheless was not followed by any action whatsoever against Regulation No 1187/94.

51 In arriving at those figures, the Commission used not only the information supplied by the various authorities but also the figures provided by the producers, manufacturers and dealers concerned, as the Italian Minister for Agriculture conceded in his letter of 2 June 1994.

52 In the same letter of protest, the Italian Minister for Agriculture expressed his concern regarding the future consequences (which in his opinion would be negative) of such a forecast or estimate: the actual yields of olives and olive oil, which would soon have to be fixed for the 1993/94 marketing year, might be reduced by some 30%.

53 Therefore the Italian authorities were aware that the estimate, or forecast, of olive and olive oil production for a specific marketing year, calculated according to criteria combining the official data with data supplied directly by the economic agents concerned, would normally be followed by similar actual (not estimated) yields. Not only is this logical, as I shall demonstrate, but it is also normal in the olive oil sector.

54 There would be little point in making a very short-term estimate or forecast in May 1994 (the date of Regulation No 1187/94) on the basis of market data with the object of permitting the advance payment of aid to olive growers and then, in July of the same year (the date of the contested Regulation), calculating the actual yields according to completely different figures obtained on the basis of merely theoretical factors. Only a marked change in the course of events in the season from May to July would justify substantial differences between the estimated figures and the actual production figures.

55 The `estimated' production does not inevitably have to become the final `actual' production. Alterations may take place between the one and the other but, logically, if the provisional calculations of the estimated production are correct (in so far as they reflect the position on the market) the final yield figures will not differ excessively unless there have been substantial changes in the factors on which the original estimate was based.

56 Furthermore, in this case the course of events followed that logical pattern. According to the Commission's figures (26) for every marketing year from 1987/88 to 1992/93 and for all Community countries producing olive oil (Italy, Spain, Greece, Portugal and France), the average error between the estimated and the actual production is of the order of only 7%.

57 In the specific case of Italy, the average difference between the two figures (provisionally estimated production and actual production) was 12% for all years from 1987/88 to 1992/93. To be more precise, the estimated Italian production for the year preceding that which is the subject of this action (namely 1992/93) was only 6% less than the actual figure: the provisional estimate was 385 000 tonnes, whereas the actual production was 410 000 tonnes. (27)

58 Judging by the data given in the various pleadings of the parties, the conclusion must be that the figures used by the Commission to fix the actual yields for 1993/94 were more reliable and reflected more faithfully the real economic conditions on the Italian olive oil market than the figures provided by the Italian authorities.

59 In fact, the arguments set out in the defence and the rejoinder and the annexes thereto show that the Italian figures for yields (based on checks and data for January 1994) were exaggerated and did not correspond to the actual supply position, which is best reflected by market prices.

60 The Italian Government did not object to the Commission's statement (28) concerning the date on which Agecontrol finished collecting data for drawing up its proposals, which was January 1994. Although in certain regions of southern Italy the olive harvest is normally well under way at the end of January, that does not apply to the whole of Italian production. Thus, weather conditions or other circumstances arising after January may have a negative effect on olive production, as the Commission contends in the present case, alluding to the adverse weather conditions of later months. (29)

61 The Commission has proved that that was what actually happened in this case by producing, as annex 3 to the rejoinder, an ISMEA information bulletin, published in February 1994, on `Italian Production of Olive Oil in 1993'. According to that document, `the previous production estimates must be revised downwards as a result of the damage caused by bad weather during the early part of the season. The effects of climatic developments were felt mainly in the south and were particularly serious in the Apulia region.' According to the same document, the olive oil production calculated by ISMEA for Italy in the year which is the subject of this action would not exceed 450 000 tonnes.

62 The fact is that, either as a consequence of climatic or other factors, the economic data relied on by the Commission, which were not adequately rebutted by the Italian Government, prove that production in the 1993/94 marketing year could not correspond to the figures proposed by the Government. The market situation, as compared with the previous year, shows that the actual figures for the preceding year would under no circumstances be exceeded - quite the contrary.

63 On the assumption that the formation of prices in a market such as that for olive oil of Community origin (30) is a suitable indicator of supply and demand, the following factors show that production for 1993/94 must necessarily have been less than in the previous year:

- prices for the various varieties of olive oil rose in 1993/94 and in every case exceeded the intervention prices, which was the opposite of what occurred in 1992/93;

- in 1993/94 there were no applications for recourse to private storage schemes, in contrast to the position in 1992/93;

- in 1993/94 it was necessary to sell at least 140 000 tonnes of stocks accumulated during the previous year at prices higher than the intervention prices.

64 All those factors prove that there was a fall in the available quantities of olive oil in the 1993/94 marketing year, which could under no circumstances have been higher than those available in 1992/93.

65 Therefore the Italian authorities' provisional estimate (630 000 tonnes) for 1993/94 was manifestly exaggerated, being considerably higher than the actual production of the previous year.

66 The final yields proposed by the Italian authorities, who calculated actual production as 581 954 tonnes of olive oil, (31) were also disproportionate and were, again, higher than for the previous year. In contrast, the figure at which the Commission fixed the Italian yields by means of the contested Regulation was much closer to reality, and therefore so also was the resulting actual production.

67 To sum up, the regulations governing the common organization of the market in the sector of oils and fats authorize the Commission to depart from the production data supplied by the Member States where, as in the present case, those data do not correspond to the true situation in the sector. Under such circumstances, the Commission may have recourse to other information, including that supplied by economic agents, and information deriving from market trends themselves, in order to calculate in each marketing year the yields of olives and olive oil on the basis of which aid to olive growers is determined.

68 Consequently there is no foundation either for the allegations concerning breach of the principle of legal certainty, which the Italian Government described in its defence as `the taking of a decision in disregard of the rules previously laid down generally for its adoption'.

69 Therefore the first plea in law must be dismissed.

Second plea in law

70 The Italian Government alleges that the contested Regulation does not contain a sufficient statement of the grounds on which it is based, a formal defect which justifies its annulment.

71 The Court has consistently held that the statement of grounds required by Article 190 of the EC Treaty must disclose in a clear and unequivocal fashion the reasoning followed by the Community authority which adopted the measure in question in such a way as to make the persons concerned aware of the reasons for the measure and to enable the Court to exercise it supervisory jurisdiction.

72 It is not necessary, however, for details of all relevant factual and legal aspects to be given in so far as the question whether the statement of the grounds for a decision meets the requirements of Article 190 of the Treaty must be assessed not only with regard to its wording but also to its context and to all the legal rules governing the matter in question. (32)

73 The first recital in the preamble to the contested Regulation sets out the grounds for the Commission's downward amendment of the figures supplied by the Italian authorities: `the figures ... have been adjusted in relation to the information supplied by that Member State [Italy] in order to bring them [the actual production figures] into line with the production estimated in Commission Regulation (EC) No 1187/94'.

74 Therefore it cannot be said that the Regulation fails to state the reasons which led the Commission to act as it did. The abovementioned recital makes it clear that the reduction in yields, as against the proposed figures, is based on the link between estimated production and actual production. Whether or not the applicant accepts such a criterion and its consequences as legally correct is another matter, but this does not affect the formal requirement of a statement of reasons.

75 In fact the Italian Government frankly admits in its reply that the Regulation does state the grounds on which it is based, thereby invalidating its second plea in law. The reply actually states: `since the Regulation contains a clear, specific statement of the reason for which the Italian yields have been fixed in a significantly different manner from the national proposal [...]'.

Third plea in law

76 In its final plea in law, the applicant Government claims that the Commission misused its powers in adopting the contested Regulation.

77 The misuse of powers being defined as the use of powers conferred upon an institution, or an authority in general, for a purpose different from that laid down by the measure in question, the Commission would have misused its powers if it had adopted the Regulation for a purpose other than that of contributing to the more efficient management of the aid scheme for olive oil producers.

78 To have any chance of success, an application which alleges a misuse of powers by the Commission should at least specify the purpose which it considers appropriate - the purpose pursued by the measure in question - as well as the improper purpose of which it accuses the Commission.

79 That has not been done here. The application concludes with the assertion that, in fixing the yields by reference to the estimated production, the Commission `pursued and attained the objective, which was not authorized by Regulation No 2261/84, of using independent assessments, and not merely corrections of the data supplied by the Member States, for the fixing of yields'.

80 That assertion mistakenly identifies objectives (or purposes) with ways and means. The use of data different from those supplied by the Member States is not an `objective', but a means of attaining an objective. In the present case, as the Commission correctly observes, its only purpose was to contribute to the more efficient management of the common organization of the market in oils and fats.

81 Even if the fixing of yields by the Commission on the basis of information differing from that supplied by the Member States were invalid, the contested Regulation (which in that case would be void for infringement of the rules on the fixing of yields) would not be void by reason of misuse of powers. The Commission would have acted in pursuit of the purpose laid down by the Regulation, but would have used the wrong means.

82 Consequently this plea in law must also be rejected.

Costs

83 Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. The Commission has applied for costs and its application should be granted.

Conclusion

84 In view of the foregoing, I propose that the Court should;

(1) dismiss the application;

(2) order the Italian Republic to pay the costs.

(1) - OJ 1994 L 193, p. 1.

(2) - OJ, English Special Edition 1965-1966, p. 221.

(3) - OJ 1984 L 208, p. 3.

(4) - As amended by Council Regulation (EEC) No 3499/90 of 27 November 1990 (OJ 1990 L 338, p. 1).

(5) - Article 2(4) of Council Regulation (EEC) No 2261/84, as amended by Council Regulation (EEC) No 3500/90 of 27 November 1990 (OJ 1990 L 338, p. 3) provides as follows:

`In the case of olive growers whose average production is at least 500 kilograms of oil per marketing year, the aid shall be granted in accordance with the first indent of Article 5(2) of Regulation No 136/66/EEC in respect of the quantity of oil actually produced at an approved mill.

In the case of other growers, the aid shall be granted in accordance with the second indent of Article 5(2) of Regulation No 136/66/EEC and shall be equal to the amount obtained by applying the average olive yields and oil yields over the previous four marketing years, fixed according to a standard method in accordance with Article 18 of this Regulation, with regard to the number of olive trees in production and provided the olives are processed into oil at an approved mill'.

(6) - As amended by Regulation No 3500/90 cited above.

(7) - OJ 1984 L 208, p. 11.

(8) - OJ 1984 L 288, p. 52.

(9) - As amended by Commission Regulation (EEC) No 1318/92 of 22 May 1992 (OJ 1992 L 140, p. 11).

(10) - OJ 1994 L 132, p. 4.

(11) - The differences between Italy's proposal and the Regulation relate to determination of the number of kilogrammes of olives obtained from each olive tree. The Commission thus maintained the figures for the olive oil for each 100 kg of olives.

(12) - Regulation No 2262/84 so provides.

(13) - Case 22/88 Vreugdenhil and another v Minister van Landbouw en Visserij [1989] ECR 2049, paragraph 16.

(14) - See the Vreugdenhil judgment cited above, paragraph 16; also Case 61/86 United Kingdom v Commission [1988] ECR 431, paragraph 7; Joined Cases 279/84, 280/84, 285/84 and 286/84 Walter Rau Lebensmittelwerke v Commission [1987] ECR 1069, paragraph 14, and Case C-478/93 Netherlands v Commission [1995] ECR I-3081, paragraph 30.

(15) - Roquette Frères v Council [1979] ECR 3333.

(16) - See Commission Regulation (EEC) No 2920/93 of 22 October 1993 fixing the uniform reduction coefficient for determining the quantities of bananas to be allocated to each operator in categories A and B in the context of the tariff quota for the second half of 1993 (OJ 1993 L 264, p. 40).

(17) - Council Regulation (EEC) No 404/93 of 13 February 1993 on the common organization of the market in bananas (OJ 1993 L 47, p. 1).

(18) - Paragraph 37.

(19) - The Court adds (paragraphs 38 to 40) that the finding that the Commission has power to check and revise national data is not invalidated by the judgment in Joined Cases C-106/90, C-317/90 and C-129/91 Emerald Meats v Commission [1993] ECR I-209, at paragraph 40 of which the Court held that the requirements of Community management do not entail that the Commission ought necessarily to be able to correct wrong decisions taken in specific cases by the national authorities in connection with management of the quotas.

(20) - Emphasis added.

(21) - The controversy on this point has sometimes come close to a word game: the Italian Government admits that the Commission may `correct' national data, but not `replace' them. The Commission in turn states that it `adjusts' the data. The three words express the same result in fact: the two sets of data differ. The problem, in my opinion, is not quantitative but qualitative in the sense that it relates to the power to change the data. If it is agreed that such power exists, the only matter which must be assessed is the criteria according to which the new data can be determined.

(22) - Emphasis added.

(23) - See paragraph 19 of this Opinion.

(24) - This is stated in the communication of 28 July 1994 from the EAGGF to the Italian authorities (Annex 4 to the defence).

(25) - Annex 1 to the defence.

(26) - `Study of the margins of error between estimated production and actual production', Annex 3 to the defence.

(27) - Later on I shall demonstrate the importance of the figures for this last marketing year in fixing the yields which are the subject of this action.

(28) - The statement is also consistent with the Commission's communication of 28 July 1994 to the Italian Ministry of Agriculture and to the Agecontrol agency, noting that `the yields determined [by Italy] are based on checks which were carried out by January. Such checks ought to have continued up to the end of March at least, in order to take account of specific circumstances which might affect the quantities harvested and to improve the production estimate.'

(29) - The report of the Air Force Meteorological Service, produced by the Commission as annex 4 to the rejoinder, stresses that `precipitation was very heavy in Apulia, Calabria and Sicily' for 15 days in February 1994.

(30) - According to the Commission, the Community is the leading producer (80%), the leading consumer (75%) and the leading dealer (90%) in olive oil. It follows that the Community market for olive oil is hardly influenced by imports and exports and that Community prices are the world reference prices.

(31) - The figure given in Annex 3 to the application.

(32) - See the judgment in Case C-350/88 Delacre and Others v Commission [1990] ECR I-395, paragraph 16, and the earlier judgments cited therein.