Opinion of Mr Advocate General Van Gerven delivered on 24 January 1990

1 Original language: Dutch.

2 OJ 1987, L 324, p. 32.

3 OJ 1982, L 143, p. 20.

4 OJ 1984, L 283, p. 28.

5 OJ, English Special Edition 1970 (I), p. 218.

6 The term directives is placed between quotation marks because the instruments in question current in the German legal order have no connection with the Community law concept contained in Anide 189(3) of the EEC Treaty.

7 Minutes of meetings in the Bundesministerium für Ernährung, Landwirtschaft und Forsten (Federal Ministry for Food, Agriculture and Forestry) of stock and meat representatives of the Länder.

8 Judgment of 7 February 1979 in Joined Cases 15/76 and 16/76 France v Commission [1979] ECR 321, paragraphs 7 and 8.

9 Council Regulation (EEC) No 1837/80 of 27 June 1980 on the common organization of the market in sheepmeat and goat meat (OJ 1980, L 183, p. 1).

10 Council Regulation (EEC) No 872/84 of 31 March 1984 laying down general rules for the granting of premiums to sheepmeat producers and repealing Regulation (EEC) No 2643/80 (OJ 1984, L 90, p. 40).

11 Commission Regulation (EEC) No 3007/84 of 26 October 1984 laying down detailed rules for the application of the premium for producers of sheepmeat (OJ 1984, L 283, p. 28).

12 Article 3(5) of Regulation (EEC) No 1837/80 provides that the sales year snail commence on the first Monday of April.

13 Article l(l)(a) of Regulation No 872/84.

14 Article 1(2) of Council Regulation (EEC) No 2643/80 of 14 October 1980 laying down general rules governing the granting of the premium for the benefit of sheepmeat producers (OJ 1980, L 275, p. 6), as amended with effect from the beginning of the sales year beginning in 1984 by the aforementioned Regulation No 872/84.

15 Articles 2 and 3(2) of Regulation (EEC) No 3007/84.

16 Regulation (EEC) No 3007/84 mentioned in the previous footnote did not however apply to the 1984 sales year. In the earlier Regulation (EEC) No 2660/80 of 17 October 1980 (OJ 1980, L 276, p. 16), there was no condition as to the period of time for which the sheep had to be kept.

17 Article 3(2) of Regulation (EEC) No 3007/84.

18 Article 2(1) of Regulation (EEC) No 3007/84.

19 For 1984 the only substantive condition which applied was the condition with regard to the number of animals, in addition to Article 8 of the basic regulation. The fact that as from 1985 (following the entry into force of Regulation (EEC) No 3007/84) there was a more explicit obligation on Member States to carry out on-the-spot checks (inier alia in connection with the requirement introduced at the same time to keep ewes during a given period) does not of course mean that the Member States did not previously have to carry out controls on whether the condition as to the number of ewes was satisfied; see on this point Article 4 of Regulation (EEC) No 2660/80, mentioned above in footnote 15, in which the words if necessary precede the mention of on-the-spot inspections but on the other hand the general rule is repeated in Article 5 that the Member States must adopt the necessary provisions in order to recover premiums which have been paid in error. As regards trie condition as to the number of ewes, the only condition in 1984, it is moreover difficult to draw a sharp distinction between the organization of administrative supervision and the organization of on-the-spot checks and it is difficult to see how such controls can be arranged otherwise than with the assistance of at least sampling checks on the spot. See two footnotes further on.

20 At the beginning of the written procedure it seemed that the defendant also required a reliable system for the identification of ewes. In the rejoinder it however acknowledged that the identification of sheep by earmarks is practically impossible. That factor increases the importance of on-the-spot inspections.

21 I would observe in this connection that in the case of a condition such as the one under discussion it is difficult to draw a distinction between administrative controls and on-the-spot inspections (see above, footnote 18).

22 Sec the Opinion of Mr Advocate General Capotorti of 5 December 1978 in Joined Cases 11/76, 15/76, 16/76 and 18/76 Netherlands v Commission [1979] ECR 286, it p. 319.

23 Judgment of 7 February 1979 in Joined Cases 15/76 and 16/76 France v Commission of the European Communities [1979] ECR 321, paragraphs 28, 32 and 35.

24 The fact that the administrative provisions of North Rhine-Westphalia laid down a requirement for 10 or seven ewes only in August 1985 and not April 1984, as was required by the amendment to the Council Regulation dealt with in footnotes 11 and 12, another ground for the Commission's decision to disallow the expenditure, does not therefore need to be dealt with separately.

25 Council Regulation (EEC) No 1417/81 of 19 May 1981 amending Regulation (EEC) No 1357/80 introducing a system of premiums for maintaining suckler cows (OJ 1981, L 142, p. 4).

26 Articles 1 and 5(1 )(a) of aforementioned Regulation No 1357/80 and Article 3 of Directive 72/159/EEC (OJ 1972, L 96, p. 1).

27 Article 2(1) and (2) of aforementioned Regulation (EEC) No 1357/80.

28 Article 5(4) of aforementioned Regulation (EEC) No 1357/80 as amended by Regulation (EEC) No 1417/81.

29 Article 2(2) of aforementioned Regulation (EEC) No 1357/80.

30 Commission Regulation (EEC) No 2795/83 of 6 October 1983 waiving the date in Regulation (EEC) No 1244/82 for submitting applications for premiums for maintaining suckler cows for 1983/84 (OJ 1983, L 274, p. 20).

31 Commission Regulation (EEC) No 3442/84 of 6 December 1984 waiving the date in Regulation (EEC) No 1244/82 for submitting applications for premiums for maintaining suckler cows tor 1984/85 (OJ 1984, L 318, p. 30).

32 First subparagraph of Article 1(2) of Regulation (EEC) No 1244/82.

33 For Baden-Württemberg the assessment is less negative. Some indications were given in the administrative provisions.

34 It appears from this last-mentioned factor that the Commission was too hasty in invoking this requirement with regard to the government presidency in Stuttgart.

35 The defendant also refers to other Community regulations in which a minimum percentage of 5% for checks is expressly laid down. This is Article 5 of Commission Regulation (EEC) No 2835/77 of 19 December 1977 laying down detailed rules for aid for durum wheat (OJ 1977, L 327, p. 9) and Article 4(2) of Commission Regulation (EEC) No 3061/84 of 31 October 1984 on the detailed rules for the application of a system of production aid for olive oil (OJ 1984, L 288, p. 52). According to a press report (Agence Europe of Friday 15 December 1989, No 5154) the Council of Agriculture Ministers accepted a proposal for a minimum percentage of checks by customs officers of 5% in connection with the financially very significant export refunds.

36 See my Opinion of 4 July 1989 in Case 14/88 Italy v Commission [1989] ECR 3677, paragraph 15, and the judgment of 14 November 1989 in the same case, paragraph 19.

37 Same Opinion, paragraphs 11 to 13, and judgment, paragraph 20.

38 See the Opinion of Mr Advocate General Capotorti of 5 December 1978 in Cases 11/76, 15/76 and 16/76 and 18/76 Netherlands v Commission [1979] ECR 286, 294 and 295.

39 See inter alia my Opinion in Case 262/87 Netherlands v Commission [1989] ECR 225, paragraph 12. For these reasons the comparison made at the hearing with the relationship between a prosecuting authority and a private person committing a parking offence is not to the point.

40 Set the judgment of 19 October 1989 in Joined Cases 258/87, 337/87 and 338/87, Italy v Commission [1989] ECR 3359, paragraph 18, in which the Court departed from paragraph 46 of Advocate General Lenz's Opinion of 7 July 1989.

41 In Case C-10/88 Italy v Commission [1990] ECR I-1229, concerning birth premiums for cows, in which I delivered my Opinion on 16 January 1990, I said that the Commission was not entitled to withhold the financing of expenses by reliance on a reasonable period for payment laid down by it because it only notified that period to the Member States after the year to which the relevant sums related. For Case 14/88 I refer to footnote 35 above.

42 This interpretation follows from the judgment of 21 September 1989 in Case 68/88 Commission v Greece [1989] ECR 2965, and in this respect, from the words in any event in paragraph 24. See also Mr Advocate General Darmon's Opinion of 29 November 1988, paragraph 10 (Case 94/87 Commission v Germany [1989] ECR 175), and paragraph 12 of the judgment of 2 February 1989 in the same case.

43 [19801 ECR 31.

44 More serious still, in one of these cases it was stated on the application form that the applicant was a farmer and employee, but he had nevertheless been in receipt of the benefits for years. Only by chance, (a telephone conversation) did it come to light that he earned more than half of his income as an employee. Even then conclusions were slow to be drawn.

45 Judgments of 7 February 1979 in Case 11/76 Netherlands v Commission [1979] ECR 245, paragraph 12, and in Case 18/76 Germany v Commission [1979] ECR 343, paragraph 12: it is moreover established that up to the present no specific procedure for attributing liability has been laid down by Community law for the purposes of settling differences between the Community and the Member States. The discharge of the accounts by the Commission thus necessarily entails the attribution of expenditure either to the Commission or the Member Sute concerned.

46 Judgment of 7 February 1979 in Case 11/76 Netherlands v Commission [1979] ECR 245, paragraph 25. For an example of a decision refusing financing for failure to comply with evidence requirements I would refer to the judgments of 27 February 1985 in Cases 55/83 and 56/83 Italy v Commission [1985] ECR 683 and 705, paragraph 21. The Court has rejected the subsequent regularizaron of evidential formalities, as also the replacement of prescribed evidential formalities by others: judgments of 7 February 1979 in Joined Cases 15/76 and 16/76 France v Commission [1979] ECR 321, paragraph 11, and in Case 18/76 Germany v Commission [1979] ECR 343, paragraphs 20 and 22. See also in this connection the Opinion of Mr Advocate General Mischo of 1 October 1987 in Case 347/85 United Kingdom v Commission [1988] ECR 1749, paragraph 46. That expenditure may be disallowed even when it is clear that no substantive irregularity has taken place was confirmed in the judgment of 25 February 1988 in Case 327/85 Netherlands v Commission [1988] ECR 1065.

47 Opinion of 5 December 1978 Netherlands v Commission [1979] ECR 286, at p. 292. Emphasis added.

48 See for example the judgment of 25 November 1980 in Case 820/79 Belgium v Commission [1980] ECR 3537, paragraph 15: consequently the applicant has not estabished that the incorrect application of the provisions of ... by the Belgian authorities should be attributed to the Commission. Sec also paragraph 19 of the judgment of 21 February 1989 in Case 214/86 Greece v Commission [1989] ECR 367.

49 Judgment of 12 July 1984 in Case 49/83 Luxembourg v Commission [1984] ECR 2931, paragraphs 29 to 32, where issue is uken with the Opinion of Advocate General Darmon based on earlier case-law, see p. 2950.

50 See judgment of 5 October 1989 in Case 290/87 Commission v Netherlands [1989] ECR 3083, paragraphs 16 to 20, and the Opinion of Mr Advocate General Lenz of 11 July 1989, ECR 3091, paragraph 40.

51 Commission v Greece [1988] ECR 4875. Since the Greek Government submitted no evidence to the Court on this point, the Court held that the facts had to be deemed to be established.

52 I refer here to the France v Commission judgment, cited above in footnote number 7.

53 Paragraph 19, and paragraphs 30 to 33 of Advocate General Lenz's Opinion of22 November 1988.

54 That does not mean to say that the disallowance of expenditure is a sanction imposed on the Member State. In contradistinction to a judgment under Article 171 of [he Treaty no moral reproach is implied. The clearance of EAGGF accounts is therefore no more than a decision as to the allocation of a financial burden as between two authorities.

55 In this case no such argument going to equality was put forward by the applicant. The defendant on the other hand adduced evidence giving the impression that other regions of the same Member Sute were tested against the same yardstick and found to be satisfactory, whilst some other Member States for the same reasons related to supervision had to accept the disallowance of expenditure in the same sectors.

56 See footnote 48 above.