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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Zaninotto (Agriculture) [1998] EUECJ C-375/96 (29 October 1998) URL: http://www.bailii.org/eu/cases/EUECJ/1998/C37596.html Cite as: [1998] EUECJ C-375/96 |
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JUDGMENT OF THE COURT (Fifth Chamber)
29 October 1998 (1)
(Agriculture - Common organisation of the agricultural markets - Market in wine - Compulsory distillation scheme)
In Case C-375/96,
REFERENCE to the Court under Article 177 of the EC Treaty by the Pretura Circondariale di Treviso, Sezione Distaccata di Conegliano, Italy, for a preliminary ruling in the proceedings pending before that court between
Galileo Zaninotto
and
Ispettorato Centrale Repressione Frodi - Ufficio di Conegliano - Ministero delle Risorse Agricole, Alimentari e Forestali
on the validity of the fourth indent of Article 1(3) of Commission Regulation (EC) No 343/94 of 15 February 1994 opening compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87 and derogating for the 1993/94 wine year from certain detailed rules for the application thereof (OJ 1994 L 44, p. 9), of Article 1(1)(c), (2) and (3) of Commission Regulation (EC) No 465/94 of 1 March 1994 fixing for the 1993/94 wine year the percentages of table wine production to be delivered for compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87, in Regions 3 and 6 (OJ 1994 L 58, p. 2), as amended by Commission Regulation (EC) No 610/94 of 18 March 1994 (OJ
1994 L 77, p. 12), of Article 39(1) and (4) of Council Regulation (EEC) No 822/87 of 16 March 1987 on the common organisation of the market in wine (OJ 1987 L 84, p. 1), of the fourth indent of Article 4(2) of Commission Regulation (EEC) No 441/88 of 17 February 1988 laying down detailed rules for applying compulsory distillation as referred to in Article 39 of Regulation No 822/87 (OJ 1988 L 45, p. 15), and of Article 1(1) of Commission Regulation (EC) No 3151/94 of 21 December 1994 introducing a further derogation from the detailed rules for the delivery by producers of the table wine they are required to deliver for compulsory distillation in respect of the 1993/94 wine year (OJ 1994 L 332, p. 32),
THE COURT (Fifth Chamber),
composed of: P. Jann (Rapporteur), President of the First Chamber, acting as President of the Fifth Chamber, C. Gulmann, D.A.O. Edward, L. Sevón and M. Wathelet, Judges,
Advocate General: G. Cosmas,
Registrar: D. Louterman-Hubeau, Principal Administrator,
after considering the written observations submitted on behalf of:
- Mr Zaninotto, by Ivone Cacciavillani, of the Venice Bar, and Antonio Cimino, of the Padua Bar,
- the Italian Government, by Professor Umberto Leanza, Head of the Legal Service in the Ministry of Foreign Affairs, acting as Agent, assisted by Danilo del Gaizo, Avvocato dello Stato,
- the Spanish Government, by Santiago Ortiz Vaamonde, Abogado del Estado, acting as Agent,
- the Council of the European Union, by Jan-Peter Hix and Antonio Tanca, of its Legal Service, acting as Agents, and
- the Commission of the European Communities, by Paolo Ziotti, of its Legal Service, acting as Agent, assisted by Alberto Dal Ferro, of the Vicenza Bar,
having regard to the Report for the Hearing,
after hearing the oral observations of Mr Zaninotto, represented by Ivone Cacciavillani and Antonio Cimino; of the Italian Government, represented by Danilo del Gaizo; of the Spanish Government, represented by Santiago Ortiz
Vaamonde; of the Council, represented by Antonio Tanca; and of the Commission, represented by Francesco Ruggeri Laderchi, of its Legal Service, acting as Agent, assisted by Alberto Dal Ferro, at the hearing on 26 March 1998,
after hearing the Opinion of the Advocate General at the sitting on 28 May 1998,
gives the following
Community legislation
'1. A forward estimate shall be drawn up before 10 December of each year for the purpose of determining the Community's resources and estimating its needs, including foreseeable imports from and exports to third countries.
2. The forward estimate of the Community's wine resources and needs shall show the proportion of table wines and quality wines [pdr], respectively.
3. For each wine year, the Commission shall provide the Council with a final statement of Community resources and utilisation in the preceding wine year.
4. Detailed rules for the application of this article shall be adopted in accordance with the procedure laid down in Article 83.'
'Article 82
1. A Management Committee for Wine (hereinafter called "the Committee") is hereby set up consisting of representatives of Member States and chaired by a representative of the Commission.
2. Within the Committee the votes of Member States shall be weighted in accordance with Article 148(2) of the Treaty. The Chairman shall not vote.
Article 83
1. Where the procedure laid down in this Article is to be followed, the Chairman shall refer the matter to the Committee, either on his own initiative or at the request of the representative of a Member State.
2. The representative of the Commission shall submit to the Committee a draft of the measures to be adopted. The Committee shall deliver its opinion on the draft within a time-limit which the Chairman may lay down according to the urgency of the matter. The opinion shall be delivered by the majority provided for in Article 148(2) of the Treaty.
3. The Commission shall adopt measures which shall apply immediately ...'.
'1. If, in respect of a given wine year, the market in table wine and wine suitable for yielding table wine is in a state of serious imbalance, compulsory distillation of table wine and of wine suitable for yielding table wine shall be decided on.
A state of serious imbalance as referred to in the first subparagraph shall be deemed to exist where:
(a) availabilities recorded at the beginning of the wine year exceed the level of normal utilisation by more than four months' supply, or
(b) production exceeds the level of normal utilisation by more than 9%, or
(c) the weighted average of representative prices for all types of table wine remains below 82% of the guide price from the beginning of a wine year for a period to be determined.
2. The Commission shall fix the quantities that are to be delivered for compulsory distillation to eliminate production surpluses and thus restore a normal market situation, in particular as regards the levels of foreseeable availabilities at the end of a wine year and prices.
3. The total quantity to be distilled, determined in accordance with paragraph 2, shall be shared between the various wine-growing regions of the Community, grouped together by Member State.
The quantity for distillation for each wine-growing region shall be proportional to the difference between:
- on the one hand, the production of table wine and of products upstream of table wine to be determined, obtained in the region and in the year in question, and
- on the other hand, a uniform percentage of the average quantity of table wine and of products upstream of table wine to be determined, obtained in the region in question over three consecutive reference wine years.
Until the end of the 1993/94 wine year:
- the uniform percentage shall be 85,
- the consecutive reference years shall be 1981/82, 1982/83 and 1983/84.
...
4. The quantity for distillation determined in accordance with paragraph 3 shall be shared between table wine producers in each wine-growing region.
For producers subject to the obligation to distil, the quantity for distillation shall be equal to a percentage to be determined of their production, as indicated in their production declarations, of table wine and of products upstream of table wine to be determined.
This percentage shall be obtained from a progressive scale based on the yield per hectare and may vary between regions according to yields obtained in the past.
...
5. Member States shall notify the Commission of the quantities of table wine produced in each wine-growing region delimited in accordance with paragraph 9, broken down by yield class. These data shall be compiled on the basis of the production declarations referred to in Article 3.
These notifications shall serve as a basis for:
(a) setting the total quantity for distillation in the Community;
(b) allocating this quantity among the wine-growing regions referred to in paragraph 3;
(c) determining, in cooperation with the Member States concerned, the percentage to be applied to the production of each producer subject to the
obligation to distil in order to attain the distillation volume laid down for each region.
...
9. The following shall be adopted in accordance with the procedure laid down in Article 83:
...
- the decision to carry out distillation referred to in paragraph 1,
- the criteria for applying paragraph 2 and the total quantity to be distilled referred to in that paragraph,
- the criteria for delimiting wine-growing regions, grouped together by Member State as referred to in paragraph 3, and the delimitation of those regions,
- the fixing of the uniform percentage and the consecutive reference years, and the allocation of the quantities to be distilled among the regions grouped together by Member State, referred to in paragraph 3,
- the progressive scale and the percentages referred to in paragraph 4,
...
11. If, during the 1987/88 to 1993/94 wine years, difficulties likely to jeopardise the execution or balanced application of the compulsory distillation operation referred to in paragraph 1 occur, the measures necessary in order to ensure effective application of the distillation scheme shall be adopted in accordance with the procedure laid down in Article 83.
Such measures:
...
(b) may contain an adjustment to the percentage of 85, referred to in the first indent of the third subparagraph of paragraph 3, only in so far as, for a given wine year, the ratio between the quantities available and normal consumption of table wine differs significantly from that of the reference years referred to in the third subparagraph of paragraph 3' [Regulation No 1972/87].
'The production regions referred to in Article 39(3) of Regulation (EEC) No 822/87 shall be designated to take account, on the one hand, of production and climatic conditions and, on the other, of the differences existing between Member States in terms of administrative structure and legal requirements, particularly as regards the internal organisation of cooperative wineries and producer groups.
...'.
'Average production of table wine and products upstream of table wine in the regions referred to in paragraph 2 in the three consecutive wine years 1981/82, 1982/83 and 1983/84 was as follows:
- Region 1: 1 341 700 hl
- Region 2: 57 300 hl
- Region 3: 40 182 000 hl
- Region 4: 64 163 000 hl
- Region 5: 4 632 000 hl
- Region 6: 27 500 000 hl.'
The average for Region 7 was subsequently inserted as totalling 7 250 000 hl.
'1. On the basis of the notifications from the Member States provided for in the first subparagraph of Article 39(5) of Regulation (EEC) No 822/87, the table wine production of each region shall be classified according to yield class. The definition of such classes shall take account of the quantity of table wine to be distilled in the region in question and the percentage of table wine production in the region which this quantity represents. The abovementioned classes shall be fixed on the basis of the yield classes laid down in Regulation (EEC) No 3929/87.
2. Where compulsory distillation is introduced, a rising scale shall be fixed for each region based on the yield classes referred to in paragraph 1. The steps in this scale shall be fixed at levels which ensure that, taking into account the foreseeable exemptions under Article 9, the total volume resulting from applying the scale to the quantities falling within each yield class for a given region corresponds to the volume to be distilled in the said region.'
'Expiry of the time-limits referred to ... shall have no bearing whatsoever on the accomplishment of the requirement that the quantities due from each producer be distilled.
After expiry of the said time-limits, the purchase price for the quantities delivered and the price of the alcohol which is produced from those quantities and which is delivered to the intervention agency shall be reduced by an amount equal to the aid laid down for that distillation operation in respect of neutral spirits. No aid shall be paid for distillation products which are not delivered to the intervention agency.'
'1. Distillation as provided for in Article 39(1) of Regulation (EEC) No 822/87 is hereby adopted for the 1993/94 wine year.
2. The total quantity of table wine to be distilled shall be 18 200 000 hectolitres.
3. The quantities to be distilled in the regions as referred to in Article 4(2) of Commission Regulation (EEC) No 441/88 shall be as follows:
- Region 1: -
- Region 2: -
- Region 3: 2 550 000 hectolitres,
- Region 4: 12 150 000 hectolitres,
- Region 5: 500 000 hectolitres,
- Region 6: 3 000 000 hectolitres,
- Region 7: - hectolitres.
...'.
'1. Pursuant to Article 5(1) of Regulation (EEC) No 441/88, production from the 1993/94 harvest shall be broken down into the following yield classes:
...
(c) Region 4:
Production obtained with a yield, expressed in hectolitres per hectare:
- not exceeding 45: 1 887 143 hectolitres
- of more than 45, but not more than 70: 8 394 081 hectolitres
- of more than 70, but not more than 90: 11 843 922 hectolitres
- of more than 90, but not more than 110: 10 209 474 hectolitres
- of more than 110, but not more than 125: 4 853 825 hectolitres
- of more than 125, but not more than 140: 2 002 827 hectolitres
- of more than 140, but not more than 170: 1 261 827 hectolitres
- of more than 170, but not more than 200: 195 041 hectolitres
- exceeding 200: 228 774 hectolitres.
2. ...
The average yield in Region 4 shall be 77 hectolitres per hectare.'
National legislation
The main proceedings
1. whether the fourth indent of Article 1(3) of Regulation No 343/94, and Article 1(1)(c), the second subparagraph of Article 1(2) and Article 1(3) (and the annex, to the extent that it concerns Region 4) of Regulation No 465/94, as amended by Regulation No 610/94 so far as concerns Region 4, are invalid because they contravene the prohibition against discrimination, laid down by Article 40(3) of the EC Treaty, and Article 23 of Regulation No 441/88;
2. whether the fourth indent of Article 1(3) of Regulation No 343/94 and Article 1(1), (2) and (3) of Regulation No 465/94, as amended by Regulation No 610/94, are invalid because they contravene the principle of the protection of legitimate expectations;
3. whether the fourth indent of Article 1(3) of Regulation No 343/94, and Article 1(1), (2) and (3) of Regulation No 465/94, as amended by Regulation No 610/94, are invalid because they infringe Article 31 of Regulation No 822/87 and their enactment is ultra vires because an essential precondition was not met;
4. whether Article 39(4) of Regulation No 822/87 is invalid because it contravenes the principle of proportionality in so far as it prescribes, in the case of each producer subject to the obligation, the volume to be distilled and is a wholly inappropriate means of attaining the objective sought;
5. whether the fourth indent of Article 4(2) of Regulation No 441/88 is invalid;
6. whether Article 1(1) of Regulation No 3151/94 is invalid because it contravenes Article 39(1) of Regulation No 822/87 and because an essential precondition was not met;
7. whether Article 1(1) of Regulation No 3151/94 is invalid because it contravenes the principle of proportionality with which Community policy should be consistent.
Question 1
Alleged discrimination against the Italian Republic in relation to the other Member States
the accomplishment of the requirement that the quantities due from each producer be distilled.
assessed at 79 807 000 hl. It follows that the total surplus for the wine year at issue amounted to 7 578 000 hl (87 385 000 hl - 79 807 000 hl = 7 578 000 hl). Taking into account the stocks at the start of the wine year of 46 886 000 hl and those at the end of the year assessed at 33 253 000 hl, surplus stocks amounted to 13 633 000 hl. The total surplus to be eliminated thus corresponded to the difference between the total quantities available (87 385 000 hl + 46 886 000 hl = 134 271 000 hl) and the total needs for the wine year (79 807 000 hl + 33 253 000 hl = 113 060 000 hl), that is to say 21 211 000 hl.
|
Member State |
Reference quantity |
Reference quantity 1993/94 wine year |
Production 1993 |
Surplus | Difference % |
|
D F I GR E P |
1 342
40 182 64 163 4 632 27 500 7 250 |
738 22 104 35 296 2 548 15 128 3 988 |
630 23 500 45 025 3 645 15 490 3 050 |
-
1 396 9 729 1 097 362 - |
- 11.09 77.31 8.72 2.88 - |
| Total | 145 069 | 79 802 | 91 365 | 12 584 | 100.00 |
Inaccuracy of the data forwarded by the Italian Republic
Carrying-over of undistilled quantities from one wine year to the next
approach consistent with the prohibition of discrimination as interpreted by the Court. Irrespective of the fact that defaulting producers are punished severely, there is an overriding need to remove undistilled quantities from the market in order for the objective of the system to be achieved.
Question 2
C-63/93 Duff and Others v Minister of Agriculture and Food, Ireland, and the Attorney General [1996] ECR I-569, paragraph 20). Moreover, the principle of the protection of legitimate expectations may be invoked as against Community rules only to the extent that the Community itself has previously created a situation which can give rise to a legitimate expectation (Case C-177/90 Kühn v Landwirtschaftskammer Weser-Ems [1992] ECR I-35, paragraph 14). The arguments relied on by the referring court, and adopted by the applicant in the main proceedings, in support of the contention that the legitimate expectations of Italian wine-growers were thwarted are not such as to establish that the Community created such a specific situation.
Question 3
Question 4
In their view, to select one intervention measure or another, such as the criterion of yield per hectare, is a political choice falling within the responsibilities of the Council itself. The Community legislature cannot be in a position to foresee accurately all the future effects of an adopted measure and, if certain measures subsequently prove less effective than anticipated, it does not automatically follow that they were unlawful when adopted.
is to absorb surpluses of table wine on the market, as is apparent from the forty-fifth recital in the preamble to Regulation No 822/87.
Question 5
Regulation No 822/87, are constituted from the data collated by the Member States for their territory. The same approach should prevail with regard to the data forming the basis of the forward estimate, which itself is at the origin of a decision as to whether or not there should be compulsory distillation. The Commission points out in addition that, as regards climate and oenology, the different characteristics of certain production areas in Italy in any event cancel each other out naturally, so that the determination finally proves to be balanced. Besides, the Italian Government gave its agreement to that delimitation.
Questions 6 and 7
Costs
82. The costs incurred by the Italian and Spanish Governments, the Council and the Commission, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, 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 (Fifth Chamber),
in answer to the questions referred to it by the Pretura Circondariale di Treviso, Sezione Distaccata di Conegliano, by order of 2 November 1996, hereby rules:
Examination of the questions raised has disclosed no factor of such a kind as to affect the validity of:
- the fourth indent of Article 1(3) of Commission Regulation (EC) No 343/94 of 15 February 1994 opening compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87 and derogating for the 1993/94 wine year from certain detailed rules for the application thereof;
- Article 1(1)(c) and (2) of Commission Regulation (EC) No 465/94 of 1 March 1994 fixing for the 1993/94 wine year the percentages of table wine production to be delivered for compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87, in Regions 3 and 6, as amended by Commission Regulation (EC) No 610/94 of 18 March 1994;
- Article 39(1) and (4) of Council Regulation (EEC) No 822/87 of 16 March 1987 on the common organisation of the market in wine; or
- the fourth indent of Article 4(2) of Commission Regulation (EEC) No 441/88 of 17 February 1988 laying down detailed rules for applying compulsory distillation as referred to in Article 39 of Regulation No 822/87.
|
Jann
Sevón Wathelet
|
Delivered in open court in Luxembourg on 29 October 1998.
R. Grass J.-P. Puissochet
Registrar President of the Fifth Chamber
1: Language of the case: Italian.
