Opinion of Mrs Advocate General Rozès

Mr President,

Members of the Court,

A number of questions have been referred to this Court for a preliminary ruling under the first and second paragraphs of Article 177 of the EEC Treaty by His Honour Judge Brian Grant sitting at Tunbridge Wells County Court concerning the activities of a body governed by English law known as the Apple and Pear Development Council [hereinafter referred to as the Development Council].

This request for a preliminary ruling is submitted in the context of a dispute between that body and three growers of apples and pears, K. & J. Lewis Ltd, Leighton Fruit Ltd and R. M. O. Capper. Section 1 (1) of the Industrial Organization and Development Act 1947 authorizes the relevant minister to make a Development Council Order in respect of an industry where it appears to him to be expedient to increase the efficiency or productivity of the economic sector in question. By means of inquiries carried out before the creation of such a body and subsequently at least every five years, the Minister is required to satisfy himself that the existence of such a Development Council is desired by a substantial number of the persons engaged in the industry.

By virtue of those provisions, the United Kingdom Minister for Agriculture, at the request of producers of apples and pears, made the Apple and Pear Development Council Order 1966. After consultations were made as to whether the Development Council should remain in being and a positive response was obtained, the Order was superseded by another bearing the same title in 1980. Pursuant to the Order, every grower in England or Wales with two hectares or more planted with 50 or more apple or pear trees is obliged to register with the Development Council and to pay to it an annual levy, the maximum amount of which is fixed by the Minister; the rate was fixed as UKL 29 per hectare by Article 9 (1) of the 1980 Orderand was increased to UKL 40 per hectare by the Order amending the latter.

The Development Council brought an action against the defendants before the Tunbridge Wells County Court in order to obtain payment of the levy which was due and unpaid for the year ending on 30 March 1981.

The refractory growers claim that the creation and the functions of a body such as the Development Council are incompatible with the common organization of the market in fruit and vegetables and have an effect equivalent to quantitative restrictions on trade between the Member States. Consequently, they consider that the Development Council was not entitled to require them to pay a charge intended to finance unlawful activities. They therefore claim refund of the levy as from 1 February 1973.

The Development Council of course rejects that argument: it considers that its existence and the exercise of its functions are wholly in conformity with Community law. But the Development Council contends that, even if that were not the case, the defendants would not be entitled to oppose its request for payment of the charge or to secure any refund of the charges actually paid.

In order to settle this conflict, the national court has asked this Court to give a preliminary ruling on a number of questions which, for ease of exposition, I shall summarize as follows:

These various questions raise difficulties of different kinds. I shall give particular attention to the first question, for in answering that question I will come to deal with two of the three matters which are the only ones to have given rise to real differences between the various parties to these proceedings.

Those two matters are:

The third main subject in the proceedings before this Court relates to the classification as aid, within the meaning of Articles 92 and 93 of the Treaty, of the charge levied on growers by the Council. Since that question was not among those submitted by the national court, it is debatable whether the Court may give an answer to it on its own initiative.

Because this point is of a preliminary nature, I shall consider it first.

1. At the hearing, the Development Council expressed serious doubts as to whether such an examination was appropriate. It pointed out that that question, which had been raised for the first time in the proceedings before this Court, was entirely new and unconnected with any of the matters contemplated by the national court. It takes the view that to give an answer on that point would jeopardize the balance between the prerogatives of the national courts on the one hand and of the Court of Justice on the other, in the matter of references for preliminary rulings. It considers that to do so might endanger the rights of the parties to the main proceedings, who would have been able to submit observations or at least more wide-ranging observations on those questions before the national court and before this Court if they had been raised at a stage in the proceedings prior to the submission of written observations by a Community institution and a Member State, which are not parties to the dispute.

2. This question assumed great importance in the oral procedure, probably because of the position adopted by the Commission. It considers that the activities of the Development Council contravene Community law.

A — The advertising of English and Welsh fruit.

I shall now examine the first question submitted by the national court and thus consider the compatibility with Community law of the advertising campaigns for English and Welsh fruit and the Development Council's activities regarding quality standards.

I shall also answer the specific questions raised by the national court concerning in particular the constitution of the Development Council, compulsory registration, the obligation to furnish returns and information and the obligation to pay a charge.

A — The advertising of English and Welsh fruit.

I think it is helpful to distinguish between the campaigns organized for that fruit in general and those which concentrate on certain specific varieties.

The applicable rules of Community law are, first, those relating to the common organization of the market and, secondly, those relating to the free movement of goods which, as I have already said, are to be regarded as forming an integral part of the common organization.

1. In this case, it is incontestable that the campaigns in question are intended to enable British growers to recover their share of the market. Certain documents in the file clearly show that their share has decreased in recent years, to the advantage of growers in other member countries of the Community (in particular France) and even growers in nonmember countries (South Africa, New Zealand).

2. The Development Council's annual reports show that it has undertaken promotional activities for certain varieties of fruit. I refer to the action taken to promote Cox and Bramley apples.

B — Activities regarding quality standards

The Development Council issues recommendations to those engaged in the British trade with the aim of ensuring that traders market only fruit which meets certain quality standards.

The regulation on the cortimon organization of the market in fruit and vegetables permits the marketing of fruit which meets other quality standards (in fact, fruit of inferior quality).

It is therefore important to determine whether the recommendations are of a mandatory nature, since if they are they would be contrary to Regulation No 1035/72 and more specifically to Title I thereof; Common standards.

Unfortunately, only one reference in this respect is before the Court. In a passage in its 1981 report, the Development Council is pleased to be able to report that, while fruit below the recommended minimum size was found on the wholesale markets, it was rarely that a grower again marketed such fruit after the lapse had been brought to his notice and it adds that Reports of substandard fruit by wholesalers were also analysed and the names of wholesalers who featured on several occasions were brought to the notice of the National Federation of Fruit and Potato Trades.

On this point also, only the national court can verify the exact scope of the recommendations — it does not seem to me that mere opinions are necessarily contrary to the provisions of Regulation No 1035/72.

I shall now consider the matters expressly dealt with by the national court in the various parts of this question.

1. It is not in doubt that the constitution of the Development Council to which the national court refers again in the first subquestion is in no way incompatible with Community law.

2. The obligation to register (second subquestion submitted by the national court) merely constitutes in my opinion a means of ensuring collection of the compulsory charge referred to in the fourth subquestion. It appears necessary to oblige growers to register with the Development Council so as to make possible the effective collection of the charge which they must pay. It does not seem to me that making noncompliance with that obligation a specific criminal offence is sufficient to make that obligation separate from the collection of the charge.

3. Likewise, the Development Council's entitlement to require growers to furnish returns and information on their business and the fact that noncompliance with that obligation is made a criminal offence do not seem to me to be contrary to any rule or principle of Community law.

4. On the other hand, the matter of appraising the lawfulness of the annual compulsory charge paid by growers to the Development Council to enable it to cover the costs of its activities is more complex.

5. Finally, as regards the last subquestion submitted by the British court, it seems to me to be logical to exempt very small growers from the obligations described in the foregoing subquestions. It may be assumed that growers with less than two hectares of land planted with apple or pear trees or fewer than 50 apple or pear trees do not market their production or do so only to an extremely limited extent.

The second question:

It seems clear to me that if the measures in question are incompatible with Community law, neither the fact that they emanate from a body which was created on the initiative of a majority of the growers concerned nor the fact that it is continued as their wish renders those measures lawful. It goes almost without saying that neither that consent nor, a fortiori, consultation with other interested parties can render such measures compatible with Community law.

Like the first question, the third question submitted by the national court is subdivided into a number of subquestions.

1. The court asks whether the rules of Community law which may have been infringed by the Development Council have direct effect so as to confer upon individuals rights enforceable in the courts of a Member State.

2. It is also incontestable that if it were ascertained that the charge was intended for the financing of activities which are incompatible with those provisions, growers would be able to rely upon that fact as a complete defence to any action to recover the charge.

3. The direct effect of the provisions which may have been infringed can also, in principle, serve as a ground for claiming restitution of the annual charges paid by the growers. Such a claim for restitution must be limited to the portion of the charge used for financing activities contrary to Community law. It is for the national court to determine on that basis, and in accordance with the procedures laid down by its national law, how that restitution ought to take place.

4. The national court then asks whether a claim for restitution of the charges extends to the charges paid before promulgation of the judgment giving the preliminary ruling or whether it is limited to such payments as may be made thereafter.

5. Finally, the national court asks whether, in deciding whether to order restitution of any charges, the court of the Member State is entitled to take into account the fact that the money raised by the charges has been used for purposes from which the grower has or might have derived a benefit.

The fourth question

This question is intended to determine the date aš from which any of the measures described in the first question is to be held to be incompatible with Article 30 or Article 34 of the Treaty.

I have already said that none of the Development Council's activities can be regarded as incompatible with Article 34 of the Treaty. But I have pointed out that the activities of that body to promote certain varieties and with regard to quality standards may be capable of hindering directly or indirectly, actually or potentially, intra-Community trade. That question is therefore by no means theoretical.

The national court is unable to decide between two dates: 1 January 1975 and 1 February 1973. The choice of 1 January 1975 would amount to an application of the second paragraph of Article 42 of the Act of Accession; that provision comes under Title I (Free movement of goods) in the fourth part (Transitional measures) of the Act concerning the conditions of accession and the adjustments to the Treaties. It provides that measures having an effect equivalent to quantitative restrictions on imports and exports are to be abolished by that date at the latest.

Article 60 (1) forms part of Title II (Agriculture) of the fourth part. It provides that the system applicable in the Community as originally constituted in respect of measures having an effect equivalent to quantitative restrictions is to apply in the new Member States as from 1 February 1973, save in exceptional circumstances which arc not relevant here.

There is no doubt that the latter provision, constituting as it does a lex specialis for agricultural products, applies here and so therefore does the date 1 February 1973.

For all the foregoing reasons, my opinion is that the Court should give the following answers to the questions submitted by his Honour Judge Brian Grant sitting at Tunbridge Wells County Court:

1 Translated from the French.

2 Statutory Instrument 1980 No 623.

3 Statutory Instrument 1980 No 2001, Article 2.

4 Case 83/78, Pigs Marketing Board (Northern Ireland) v Redmond [1978] ECR 2347.

5 Case 177/78, Pigi and Bacon Commission v McCarren [1979] ECR 2161.

6 Paragraphs 52 to 55, [1978] ECR at pp. 2370 and 2371.

7 In particular Articles 13 and 16 and 30 and 34 thereof.

8 Pigs and Bacon Commission v McCarren, cited above, paragraphs 9 to 11 of the Decision, at pp. 2186 and 2187.

9 Case 78/76 Steinike und Weinlig V Federal Republic of Germany [1977] ECR 595.

10 Paragraph 22; see also paragraph 21; both on p. 611.

11 [1979] ECR 2203 and 2204.

12 However, it is not apparent from the documents before the Court whether the latest increase of the charge, made in December 1980, was in fact notified to the Commission.

13 Opinion in Pigs and Bacon Commission, cited above, at p. 2204.

14 Opinion in Case 51/74 Van der Hulst, [1975] ECR at p. 105.

15 1981 Report, paragraph II (Outlook), p. 18.

16 Judgment of 24 November 1982 in Case 249/81, Commission v Irland (the Buy Irish campaign), paragraph 27 of the Decision, [1982] ECR 4005.

17 Same judgment, paragraph 15.

18 Annual report and accounts for the year ended on 31 March 1981, p. 17.

19 Articles 2 to 12.

20 Page 11.

21 Page 11.

22 Article 4 of the 1966 and 1980 Apple and Pear Development Council Orders.

23 See to that effect, in particular, the judcnicnt of 22. 3. 1977 in Case 74/76, lannelli [1977] ECR 557, paragraph 9 of the Decision; Opinion of Mr Advocate General Warner in Case 177/78, Pigs and Bacon Commiision v McCarren, [1979] ECR at pp. 2209 and 2210.

24 Judgment of 12. 7. 1973 in Case 2/73, Geddo [1973] ECR 865, paragraphs 5 and 6 of the Decision; judgment of 17. 5. 1983 in Case 132/82, Commission v Belgium, paragraph 8 of the Decision, [1983] ECR 1649, and in Case 133/82, Commission v Luxembourg, paragraph 9 of the Decision, [1983] ECR 1669.

25 Joined Cases 36 & 71/80, Irish Creamery Milk Suppliers Association and Others v Government of Ireland and Others; Martin Doyle and Others v An Taoiseach and Others [1981] ECR 735.

26 Same judgment, paragraph 24 of the Decision.

27 Judgment of 29. 11. 1978 in Case 83/78, Pigs Marketing Board v Redmond [1978] ECR 2347, paragraph 67 of the Decision.

28 Judgment in Geädo, cited above, paragraphs 2 to 4 of the Decision.

29 Judgment in Pigs and Bacon Commission, cited above, paragraph 24 of the Decision.

30 Same judgment, paragraph 25 of the Decision.

31 Judgment of 27. 3. 1980 in Case 61/79, Amministrazione delle Finanze dello Stato v Denkavit [1980] ECR 1205, paragraph 16 of the Decision; judgment of the same date in Joined Cases 66, 127 and 128/79, Salumi [1980] ECR 1237.

32 Judgment of 8. 4. 1976 in Case 43/75, Defrenne v Sabena (Defrenne II) [1976] ECR 455, paragraphs 69 to 75 of the Decision, in particular paragraphes 74 and 75; judgment of 10. 7. 1980, Third Chamber, in Case 811/79 Amministrazione delle Finanze dello Stato v Ariete, [1980] ECR 2545, paragraph 6 of the Decision.

33 Judgment cited above, paragraph 7 of the Decision.

34 Judgment of 10. 7. 1980, Ariete, cited above, operative part; to the same effect: Pigs and Bacon Commission v McCarren, cited above, paragraph 25 of the Decision and third paragraph of the operative part.

35 Ariete judgment cited above, paragraph 13 of the Decision.

36 Classical formula used since the judgment of 11. 7. 1974 in Case 8/74 Dassonville [1974] ECR 837, paragraph 5 of the Decision.