Opinion Of Mr Advocate-general

Mr President,

Members of the Court,

The matters giving rise to this case are as follows:

Rheinmühlen, a company which specializes in flour milling and in the dealing—especially on an international scale—in cereals and products processed therefrom, declared to the competent German authorities that during the period from 30 December 1964 to 16 December 1965 it had exported approximately 800 metric tons of hulled barely and 200 metric tons of cereal meal of durum wheat.

In the export declarations which it signed it stated as country of consumption (Verbrauchsland) various third countries: Portugal, Switzerland, Yugoslavia, etc.

After having produced these declarations it claimed in respect of the said exports the refunds which, in accordance with Article 20 of the basic regulation, Regulation No 19 on the progressive establishment of an organization of the markets in cereals, the Federal Republic of Germany had instituted in favour of German exports to third countries by a regulation on refunds applicable to cereals and rice (Erstattungsverordnung Getreide und Reis) of 24 November 1974.

This was acceded to not by way of the grant of refunds in cash but as was allowed by the regulation then in force in the form of an authorization to import free of levy certain quantities of basic products.

But at the beginning of 1966 the competent German authorities entertained doubts whether there had really been any export to third countries and they instituted an investigation in Rheinmühlen's offices.

This resulted in findings of a disturbing nature. According to the German experts all the quantities in respect of which Rheinmühlen had declared a third country as the country of consumption had in fact been put into free circulation or consumed in one of the countries of the Community, that is to say, Luxembourg, Italy or Belgium.

Rheinmühlen admitted that it was aware of the fact that the cereal meal of durum wheat which, according to the consignment declarations was destined for Switzerland, had stopped at Echternach and had been put into free circulation and consumed in Luxembourg.

On the other hand, it denies that in any event the whole of the hulled barley remained in Belgium or Italy.

Moreover, in any case it maintains that the circumstances revealed by the investigation do not affect its right to obtain refunds since the changes of destination were solely the act of its customer and no certificate DD4 was ever demanded or obtained for the goods in question.

The German Import and Storage Agency for Cereals and Fodder (Einfuhr- und Vorratsstelle für Getreide und Futtermittel) did not accept this argument and by a decision of 7 December 1966 revoked its previous decision granting refunds to Rheinmühlen.

The latter firm thereupon appealed against the revocation to the Hessisches Finanzgericht but that court dismissed the appeal on 12 August 1968.

Relying on certain pronouncements in an earlier judgment of the Bundesfinanzhof, the Finanzgericht held on the one hand, that during the periods in question, the Member States could define, as had been done in the Federal Republic of Germany by various regulations, the conditions which exports had to fulfil in order to qualify for third-country refunds and that on the other hand, according to these regulations, only exports resulting in the consumption of the product in the third country could be regarded as exports to a third country and qualify for a refund.

The case having been submitted to it by way of an appeal on a point of law, the Bundesfinanzhof seems to have certain doubts on the validity of this argument, although it could nevertheless be derived from several of its judgments.

It evidently wondered whether the German regulations were compatible with a certain Community concept of what were exports to third countries and it has raised certain questions with regard to the validity of the system instituted by the Community Regulation No 162/64.

This is the essence of the questions referred to this court which are expressed as follows:

I

The preliminary problem posed by the first question is whether a Community definition of exports to third countries existed during the period in question, that is to say, of exports which might have qualified for refunds as provided by Article 20 of Regulation No 19.

Three arguments are advanced to you on this point:

I suggest that you adopt the Commission's argument which, moreover, differs only slightly from that of the German intervention agency.

A —. The argument of the appellant in the main action that there was a complete Community definition of the concept of exports to third countries seems to me very difficult to sustain.

1. It is indisputable and moreover it is not disputed, even by Rheinmühlen, that this concept has never been the subject of an explicit definition before 1967, nor of a complete definition before 1969.

2. As I have said, the appellant in the main action does not formally dispute any of these points.

B —. If the Court accepts, as I suggest, that the concept of exports to a third country had not been clearly defined in Community law until 1969, or in any event until 1967, it will have to decide whether this concept could be defined at the discretion of the Member States or whether they had not to observe in this definition a Community minimum, to adopt the expression used by the Commission.

C —. If the Court shares my views on this point, it will then have to determine what were these minimum Community requirements which the Member States had to observe in their definition of exports to third countries.

1. None of the arguments which the Commission puts forward against contention seems to me decisive.

2. However, these objections—some of which may moreover, in my opinion, be overcome without much difficulty by invoking the general concept of force majeure —seem to me after all to be a secondary aspect of the question when one examines the fundamental economic objectives which have led to the institution of refunds for exports to third countries. ,

II

The second question asked by the Bundesfinanzhof relates to the validity of Regulation No 162/64 of the Commission of 29 October 1964 which restricted until 31 March 1965 the maximum amount of the refund applicable to exports to Member States of certain products processed from cereals or rice.

In this respect let me at once emphasize one of the difficulties of this case.

The Bundesfinanzhof has submitted to the Court a problem relating to the validity of this regulation.

The appellant in the main action has used this as a pretext to present the Court with another entirely different problem though admittedly also relating to the validity of that regulation, and, as I shall explain in a moment, I entertain very considerable doubts whether the Court is obliged to decide on this second problem of validity.

A —. Be that as it may, let us for a moment examine the problem of validity raised by the Bundesfinanzhof.

B —. Let us now turn to the problem of the validity of Regulation No 162/64 raised not by the Bundesfinanzhof but by the appellant in the main action in its observations before the Court.

1. We must nrst ask ourselves whether the Court needs to examine and answer the question put forward.

2. If, contrary to my view, the Court considers that it must do justice fully to the parties concerned on this point, it will have to settle some difficult questions

III

The third question referred by the Bundesfinanzhof will take up less time.

The Bundesfinanzhof asks in fact whether the principles evolved by the Court in its reply to the first question for the definition of the concept of exports to a third country are also valid for the application of Regulations Nos 162/64 and 164/64.

Practical reasons alone would ordain uniformity of interpretation.

There is one further reason in law: Regulations Nos 162/64 and 164/64 are regulations of the Commission adopted for the implementation of a basic regulation, Regulation No 19 of the

In my opinion, therefore, it would be legally impossible to give a different meaning to the concepts to which the implementing regulations refer from that which these same concepts have in the basic regulation.

I would therefore suggest that the Court's reply to the third question submitted by the Bundesfinanzhof be that the concept of exports to a third country must, for the application of Regulations Nos 162/64 and 164/64, be interpreted as set out in the answer to Question 1.

I would therefore suggest that the Court answer the questions referred to it by the Bundesfinanzhof as follows:

1 Translated from the French.