Report for the Hearing delivered in Joined Cases 244 and 245/85

I — Facts and procedure

Between October 1981 and June 1982 the two applicants carried out a number of commercial operations involving durum wheat and durum-wheat meal under authorizations granted under the inward processing arrangements established by Council Directive 69/73 of 4 March 1969 (Official Journal, English Special Edition 1969 (I), p. 75). The authorizations included the possibility of having recourse to the system of equivalent compensation provided for in Article 24 and to the system of prior exportation provided for in Article 25 of the directive.

The undertakings carried out prior exportations of processed cereal products (durum-wheat meal) from Italy to non-member countries and finally discharged those inward processing operations by importing primary products (durum wheat) released for free circulation in Italy. However, at the same time as the durum wheat was released for free circulation in Italy it was the subject of a declaration of exportation to two other Member States, namely France and Belgium.

Initially the Naples customs officers took the view that the operations fell within the scope of Article 20 of Commission Regulation No 1371/81 of 19 May 1981 laying down detailed rules for the administrative application of monetary compensatory amounts (Official Journal 1981, L 138, p. 1) according to which, in the version in force at the relevant time, Member States are authorized not to grant or levy monetary compensatory amounts on products declared at the same time both for release at import and for re-export. In such cases Member States shall ensure that no monetary compensatory amount is applied. The monetary compensatory amounts which were not levied exceeded LIT 2500 million.

However, at the end of June 1982, as a result of observations submitted by officials of the European Agricultural Guidance and Guarantee Fund after an inspection visit, in which they questioned the aforementioned manner of proceeding, the Italian customs authorities changed their position and requested the applicants to provide a security for that amount.

On 12 October 1983 the Italian Government asked the Commission whether or not there were grounds for recovering the monetary compensatory amounts in this case pursuant to Article 5 (2) of Council Regulation No 1697/79 of 24 July 1979 on the post-clearance recovery of import duties (Official Journal 1979, L 197, p. 1), which provides as follows: The competent authorities may refrain from taking action for the post-clearance recovery of import duties or export duties which were not collected as a result of an error made by the competent authorities themselves which could not reasonably have been detected by the person liable, the latter having for his part acted in good faith and observed all the provisions laid down by the rules in force as far as his customs declaration is concerned. In a decision notified to Italy on 6 February 1984 the Commission stated that the conditions laid down by the aforementioned provision were not satisfied and that, consequently, there were no grounds for waiving post-clearance recovery of the monetary compensatory amounts.

On 23 November 1984, in view of those circumstances, the Italian Government, in reliance on this occasion on the first paragraph of Article 13 of Council Regulation No 1430/79 of 2 July 1979 on the repayment or remission of import or export duties (Official Journal 1979, L 175, p. 1), which provides that import duties may be repaid or remitted in situations resulting from special circumstances in which no negligence or deception may be attributed to the person concerned, and in reliance on the provisions of Commission Regulation No 1575/80 of 20 June 1980 laying down provisions for the implementation of Article 13 of Regulation No 1430/79 (Official Journal 1980, L 161, p. 13), applied to the Commission for a decision whether or not the remission of monetary compensatory amounts was justified in this case.

By a decision dated 22 March 1985 the Commission stated that remission of the monetary compensatory amounts was not justified in the particular case for reasons which may be summarized as follows:

That decision is the subject of these proceedings.

II — Written procedure and conclusions of the parties

By applications lodged at the Court Registry on 5 August 1985, the applicants instituted proceedings against the Commission of the European Communities.

They claim that the Court should:

The Commission contends that the Court should:

Upon hearing the report of the Judge-Rapporteur and the views of the Advocate General, the Court decided to open the oral procedure without any preparatory inquiry. However, it requested the Commission to reply to a question before the hearing.

By a decision of 4 June 1986 the Court ruled that the two cases be joined.

Pursuant to Article 95 (3) of the Rules of Procedure, the Court assigned the case to the Fifth Chamber by a decision of 4 June 1986.

III — Summary of the submissions and arguments of the parties

The admissibility of the applications is not disputed.

The applicants made three submissions.

1. First submission: the relevant provision, namely Article 20 of Regulation No 1371/81 in this case, exempts the operation at issue from payment of monetary compensatory amounts

2. Second submission: the existence of a subjective right on the part of traders to exemption from payment of monetary compensatory amounts pursuant to Regulation No 1430/79, in the absence of negligence or deception

3. Third submission: breach of the principle of non-discrimination

IV — Reply to the question put by the Court

Question put to the Commission

At what stage are the procedures instituted by the Commission under Article 169 of the EEC Treaty against France and the United Kingdom? (Reply to be given within one month.)

Reply:

On 12 February 1986 the Commission decided to deliver reasoned opinions in the two cases. As a result of delays on technical grounds those opinions had still not been delivered on 14 July 1986 but were expected to be delivered in the near future.

V — Oral procedure

At the sitting on 22 October 1986 oral argument was presented for Cerealmangimi SpA and Italgrani SpA by P. De Caterini, Avvocato, and for the Commission of the European Communities by G. Marenco, a member of its Legal Department, acting as Agent, and by Mr Vital, an expert in the field.

The Advocate General delivered his Opinion at the sitting on 25 November 1986.

The Court requested both the applicants and the Commission in writing to reply to the following questions at the hearing:

C — The applicants' reply

1. The first question: the applicants state that the reason why the main part of their written submissions was directed at the question of the legality of their subjection to the monetary compensatory amounts and not to questions of equity was that part of the reasons on which the disputed decision was based concerned the legality of the obligation to pay monetary compensatory amounts in this case. In view of the wording of Article 13 of Regulation No 1430/79 and the Court's most recent decisions, of which they were unaware, the applicants stated that they intended to concentrate their submissions at the hearing on questions of equity.

2. The second question: the applicants maintained that no decision had been adopted by the Italian authorities. They decided, of their own motion, to offer a bank security in order to avoid proceedings for a court order.

D — The Commission's reply

The Commission stated that although no decision had been adopted by the national authorities requiring the payment of monetary compensatory amounts by the applicants, the latter would be free to contest the legality of such a decision should it be adopted.

Since the applicants had not challenged the Commission's decision of 6 February 1984, referred to in the fifth paragraph of heading I above, they could not now submit such arguments in respect of the contested decision based on Article 13 of Regulation No 1430/79.

The Commission maintained that until the hearing the applicants had not raised the question of equitable grounds and that their new submission relating to the alleged disruption of commercial and contractual relationships between trading partners constituted an inadmissible new issue. Since the arguments adduced in support of that submission are based on questions of fact the Commission stated that it was not in a position to reply to them without extensive research.

Finally, the Commission stated that, in connection with the procedures referred to under heading IV above, the reasoned opinions were delivered to the Member States concerned on 23 September 1986.

1 Language of the Case: Italian.