Report for the Hearing delivered in Case 316/86
I — Facts and procedure
1. Article 12 (1) of Regulation (EEC) No 2727/75 of the Council of 29 October 1975 on the common organization of the market in cereals (Official Journal 1975, L 281, p.1) provides that all imports into the Community or exports therefrom of the products covered by that regulation are to be subject to the submission of an import or export licence issued by the Member States to any applicant irrespective of his place of establishment in the Community; where the levy or refund is fixed in advance, the fixing is to be noted on the export licence, which is to be valid throughout the Community. Article 16 (2) provides that the refund is to be the same throughout the Community; under Article 16 (4), the refund is to be applied, if the applicant so requests when applying for the licence, to an export to be effected during the period of validity of the licence.
2. Article 16 (3) of Regulation (EEC) No 193/75 of the Commission of 17 January 1975 laying down common detailed rules for the application of the system of import and export licences and advance fixing certificates for agricultural products (Official Journal 1975, L 25, p. 10) set up inter alia by Article 12 of Regulation No 120/67 (cereals), replaced by Article 12 of Regulation No 2727/75 (cereals), provides that licences or certificates and extracts properly issued and entries and endorsements stamped by the authorities of a Member State are to have, in each of the Member States, the same legal effects as attach to documents issued and entries or endorsements stamped by the authorities of such Member States.
3. By means of Regulation (EEC) No 974/71 of the Council of 12 May 1971 on certain measures of conjunctural policy to be taken in agriculture following the temporary widening of the margins of fluctuation for the currencies of certain Member States (Official Journal, English Special Edition 1971(1), p. 257) the Council had introduced the system of monetary compensatory amounts. Article 6 provides that the detailed rules for the application of that regulation, which may include other derogations from the regulations on the common agricultural policy, are to be adopted in accordance with the management-committee procedure.
4. Article 1 (1) of Commission Regulation (EEC) No 243/78 of 1 February 1978 providing for the advance fixing of monetary compensatory amounts (Official Journal 1978, L 37, p. 5) lays down the principle that in trade with nonmember countries monetary compensatory amounts may be fixed in advance. Under the second subparagraph of Article 2 (1), the monetary compensatory amount may be fixed in advance only if the import or export levy or refund is fixed in advance for the certificate in question; Article 2 (3) states that the certificate or an extract therefrom is to be valid in only one Member State to be designated by the applicant on submission of the application for the advance fixing of the monetary compensatory amount.
5. At the end of May 1979, Firma P. Krücken, the plaintiff and respondent in the main proceedings (hereinafter referred to as Krücken), cleared through customs with a view to export from the Federal Republic of Germany to Switzerland a consignment of 1250 tonnes of barley. The export certificate that it presented to the German customs authorities for that purpose, which had been issued in France and had noted on it advance fixing of both the rate of the export refund and the monetary compensatory amounts, indicated that it was valid only in France. Having regard to Article 16 (3) of Regulation No 193/75, which provides that export certificates issued in a Member State are to be valid in all the Member States, the customs officer agreed to complete the formalities for the quantity exported on the basis of that certificate.
6. The Hauptzollamt (Principal Customs Office) Hamburg-Jonas, the defendant and appellant in the main proceedings, by decision of 7 August 1979 granted the export refund and the monetary compensatory amount at the rate in force at the time of exportation, relying on Article 2 (3) of Regulation No 243/78, which limits the validity of the export certificate in which the monetary compensatory amount is fixed in advance to the Member State for which the certificate was applied for.
7. In proceedings brought by Krücken, the Finanzgericht (Finance Court) Hamburg granted the export refund ai the rate fixed in advance in the certificate, on the ground that the amount of the refund was the same for export from all the other Member States to nonmember countries and that the limitation of the validity of the certificate, as regards the advance fixing of monetary compensatory amounts, did not affect the advance fixing of the rate of export refund.
8. An appeal on a point of law was brought by the Hauptzollamt Hamburg-Jonas before the Bundesfinanzhof (Federal Finance Court) and the latter, by provisional decision, held that the application of the rate of export refund fixed in advance in an export certificate was not conditional upon the validity of the export certificate at the date of exportation; subsequently, by order of 29 October 1986, it stayed the proceedings and referred the following questions to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty:
9. The Bundesfinanzhofs order was received at the Court Registry on 17 December 1986.
10. Pursuant to Article 20 of the Protocol on the Statute of the Court of Justice of the EEC, written observations were submitted on 10 March 1987 by Krücken, the plaintiff and respondent in the main proceedings, represented by Axel Bauer, Rechtsanwalt, Hamburg, on 17 March 1987 by the Commission of the European Communities, represented by its Legal Adviser, Peter Karpenstein, and on 20 March 1987 by Hauptzollamt Hamburg-Jonas, the defendant and appellant in the main proceedings, represented by its Director, Eckhardt Bollmann, Regierungsdirektor.
11. 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. The Commission was asked to answer certain questions. It did so within the period set for that purpose.
12. Pursuant to Article 95 (1) and (2) of the Rules of Procedure, the Court, by decision of 20 May 1987, assigned the case to the Fifth Chamber.
II — Written observations submitted to the Court
1. The Hauptzollamt Hamburg-Jonas, the defendant and appellant in the main proceedings, states that the advance fixing of a refund is possible, whether or not the export of the products in question is subject, as in the case of cereals, to the production of a certificate. Advance fixing is carried out by the competent authorities in the Member States by their issuing an - administrative document known as the export certificate' where the advance fixing is linked to such a certificate or the advance-fixing certificate. The term certificate is sometimes used in a limited sense, referring only to export or import certificates as in the case of the regulations establishing common market organizations, and sometimes, as in the case of Regulation No 193/75, in a wider sense, covering advance-fixing certificates.
2. Krücken, the plaintiff and respondent in the main proceedings, maintains that the wording certificate valid in France appearing on the certificate may lead to confusion in so far as it does not clearly indicate that the certificate is valid only in France. The territiorial limitation of the validity of the certificate derives only from Regulation No 243/78 where the monetary compensatory amount is fixed in advance and is, in principle, contrary to Article 16 (3) of Regulation No 193/75. Moreover, Regulation No 243/78 itself lays down that limitation only in cases where Article 4 (6) thereof applies, and it does not apply in this case. The Finanzgericht Hamburg and the Bundesfinanzhof, in a previous provisional decision, acknowledged that the rules on certificates and those on refunds are independent from each other and that the limitation of the validity of the certificate should have no effect on the refund. The view that the sets of rules are independent is in conformity with the judgment of the Court of 8 April 1976 (Case 106/75. Merkur-Außenhandel GmbH [1976] ECR 531), which made it clear that entitlement to an export refund exists even where the exported product is not the one for which the certificate was issued. It is true that that judgment left open the question whether that concept of separation applies also to the advance fixing of refunds, since, where goods other than those covered by the advance fixing are exported, as in the lastmentioned case, the rate fixed in advance cannot be claimed. But the grounds of that judgment, which give the reasons for separate appraisals of the rules on certificates and those on refunds, apply also in the case of advance fixing, particularly since, in the present case, the relevant requirements for the application of the rate fixed in advance, namely that the goods referred to in the advance-fixing certificate be exported within the period prescribed and to the nonmember country indicated therein, are met. The Court has recognized that the purpose of the legislation on certificates is to enable the Community to forecast the movements of goods, and that that of the legislation on refunds or levies is to offset the difference between Community prices and those on the world market. The system of advance fixing of refunds is covered by the provisions on refunds and not those on certificates. The application of a rate of refund which differed according to the Member State of exportation would go against the spirit of the Community legislation on refunds and is not provided for in Regulation No 243/78. A distinction must be drawn between the import or export certificate, the only documents referred to in Article 2 (3) of Regulation No 243/78, which speaks of a limitation of the validity of the certificate, and the advance-fixing certificate, a term not used in that article. The German version of the provision properly distinguishes between the import or export certificate and the advance-fixing certificate. The third recital in the preamble to Regulation No 243/78, it must be conceded, allows advance fixing of monetary compensatory amounts only where the levy or refund is fixed in advance, but the fifth recital refers only to the limitation of the Gültigkeitsdauer (period of validity) of a certificate in the territory of a Member State, which makes it clear that the limitation relates only to the period of validity, a term which, moreover, is also used in the fourth recital of the French version of the regulation. The import or export certificate, the advance fixing of the refund and the advance fixing of the monetary compensatory amount are three separate administrative measures. The fact that they are dealt with in one and the same printed form does not create legal unity between them.
3. The Commission considers that an export certificate with advance fixing both of the export refund and of the monetary compensatory amounts is valid, pursuant to Article 2 (3) of Regulation No 243/78, only in the State designated by the person who applied for the certificate. Pursuant to the first subparagraph of Article 12 (1) of Regulation No 2727/75, Krücken was not entitled to export cereals from Germany on the basis of a certificate valid for France; the Hauptzollamt was correct to grant the refunds and the monetary compensatory amounts at the rates ruling on the day of exportation.
III — Replies to the questions put by the Court
The Commission was asked to explain the technicalities of the connection between the advance fixing of the monetary compensatory amounts and that of export refunds; it stated that levies and advance fixings reflect the difference between the level of the world price and that of the Community price, but not the difference between the Community price expressed in ecu and the price at the green rate applied in the Member States, so that it is necessary to apply monetary compensatory amounts not only in intra-Community trade but also in trade with nonmember countries. Monetary compensatory amounts are intended exclusively to adapt the structure of world market prices to the variations to which the prices actually charged are subject by virtue of the green rate and they do not form part of the export refunds or levies. The monetary coefficient is merely a means of dealing with the twofold price variance between the Community price and the world price, on the one hand, and the Community price and the national price on the other. That coefficient is derived from the percentage used to calculate the monetary compensatory amount. Following the application of the monetary coefficient, levies fixed in ecu and export refunds acquire a value which is approximately the same for all the Member States.
In response to the question whether an export certificate showing an advance fixing of export refunds can be obtained without parallel advance fixing of the monetary compensatory amounts and to the question why a trader exporting the products in question from a Member State other than that mentioned in the application for advance fixing of the monetary compensatory amounts cannot waive the advance fixing for those amounts but at the same time retain the benefit of the export certificate showing advance fixing of the export refunds, the Commission stated that the second subparagraph of Article 2 (1) of Regulation No 243/78 only excludes advance fixing of monetary compensatory amounts without simultaneous advance fixing of the export refunds or levies; there is nothing to prevent the advance fixing of the export refund alone. If traders were allowed, in the case of simultaneous fixing of the refund and of the monetary compensatory amount, to export from any Member State, there would be a risk of speculation detrimental to the common agricultural Fund. In States susceptible to devaluation, the monetary compensatory amounts payable on exports are in general fixed in advance and accordingly all risk would be eliminated if it were also possible to abandon those monetary compensatory amounts on request in the event of a reverse trend emerging.
According to Article 6 (1) of Regulation No 243/78, the monetary compensatory amount valid on the day on which the application for advance fixing is lodged is applicable to all imports and exports effected during the period of validity of the certificate. The advance fixing of the monetary compensatory amounts is binding for traders, just like the advance fixing of levies and refunds. The security covers three obligations, namely the obligation to use the export certificate issued, the obligation to use the refund fixed in advance and the obligation to abide by the monetary compensatory amounts fixed in advance. If traders were permitted unilaterally to release themselves from the latter obligation, new rules would have to be created concerning the security required to cover the various obligations and the new division of powers as between the authorities of the various States.
In response to a request to give details of the nature of the speculative operations which it is sought to prevent by establishing a link between the advance fixing of the monetary compensatory amounts and that of the export refunds, on the one hand, and, on the other, by extending the limitation of the territorial validity of the certificate applicable to the advance fixing of monetary compensatory amounts to the advance fixing of export refunds, the Commission stated that, in the event of double advance fixing without limitation of the territorial validity of the certificate, exports would generally be effected only from that State which, according to the monetary situation, enabled the certificate holder to complete the most advantageous transactions. The certificate holder could in fact benefit not only from monetary fluctuations but also from any fluctuations in the green rate. However, the purpose ol advance fixing is not to ensure a particular level of profit for traders but merely to introduce a degree of stability into the conduct of a given transaction.
IV — Oral procedure
Krücken, the plaintiff in the main proceedings, contested in particular the validity of Article 2 (3) of Regulation No 243/78. It considers that provision contrary to the third subparagraph of Article 12 (1) of Regulation No 2727/75 of the Council, according to which an import or export certificate is valid throughout the Community; it also considers it contrary to Article 16 of Regulation No 193/75 of the Commission, which accords to certificates issued by the authorities of a Member State the same effects as the corresponding national documents; finally, it considers that that provision is in breach of the principle of proportionality, in so far as the limit on the validity of the certificate is not strictly necessary for attainment of the aim pursued, namely the prevention of speculation.
The Commission, for its part, considers that Article 12 (2) of Regulation No 2727/75 and Article 6 (1) of Regulation No 974/71 are provisions which expressly empower it to make derogations from the regulations on the common agricultural policy. The provision contested by Krücken is accounted for by the need to prevent abuses ror speculative purposes.
1 Language of the Case: German.