Opinion of Advocate General

Mr President,

Members of the Court,

1. The question referred by the Verwaltungsgericht Frankfurt am Main for a preliminary ruling concerns the validity of the provisions on forfeiture of security in the context of the Community rules on the granting of subsidies for oil seeds harvested and processed in the Community.

2. In order to encourage the processing industry to use oil seeds from the Member States, Article 27 of Council Regulation (EEC) No 136 of 22 September 1966 on the establishment of a common organization of the market in oils and fats provided for the granting of a processing subsidy for colza, rape and sunflower seeds. The general principles governing the granting of that subsidy are laid down in Council Regulation (EEC) No 1594/83 of 14 June 1983 and the detailed rules for the application of the system by Commission Regulation (EEC) No 2681/83 of 21 September 1983.

3. I now turn to the facts of the case. On 21 January 1991, the Bundesanstalt für landwirtschaftliche Marktordnung (Federal Office for the Organization of Agricultural Markets — hereinafter the BALM) issued ADM Ölmühlen GmbH, Ölwerke Spyck (hereinafter ADM), on application from that company and after security had been lodged, with an AP certificate for 4000000 kg of sunflower seed, the subsidy having been fixed in advance. The certificate stated that identification was to take place no later than 31 May 1991.

4. The national court is therefore asking whether Article 5 of Regulation No 1594/83 and Article 23(2) of Regulation No 2681/83 are valid having regard to the principle of proportionality in so far as, where the amount of the Community subsidy is fixed in advance, they provide for the security lodged in order to guarantee compliance with the obligation to place the oil seeds under the control of the States concerned to be forfeited, if that operation is not carried out within the time-limit laid down. The national court is asking more especially whether the aim pursued by the contested provisions could not be achieved by means less restrictive of the rights of traders, possibly by reducing the amount of the subsidy in the event of failure to comply with the time-limit.

5. In order to assess whether a rule of Community law is compatible with the principle of proportionality, it is necessary to consider, in accordance with the established case-law of the Court of Justice, whether the rule in question exceeds what is appropriate and necessary to achieve the aim pursued and, more particularly, to ascertain whether the means applied to that end correspond to the importance of the aim and are necessary in order to achieve it.

6. In this case, the aim pursued by the Community legislature in requiring observance of a time-limit for placing under the control of the State concerned the seeds benefiting from the subsidy, where the amount of that subsidy is fixed in advance, is specified in the sixth recital in the preamble to Regulation No 1594/83, which states that in that case, to prevent speculative operations, the issue of the certificate should be made subject to the provision of a security to guarantee the obligation to place the seeds under control for the period of validity of the certificate.

7. The length of the delay in fulfilling the obligation under Article 5 of Regulation No 1594/83 is hardly relevant here because, given the fluctuations to which oil seed prices are prone, a speculative operation could take place even if the time-limit were exceeded by just one day.

8. I also endorse the view taken by the Commission, according to which the crucial factor is that it is in theory possible for speculative operations to be carried out, since that is the aim of the legislation, and it is not therefore necessary to establish whether operations of that kind have actually been carried out in individual cases. Nor is the point made by the national court relevant, namely that exceeding the time-limit could entail, as in this case, a reduction in the amount of the subsidy, with the result that the trader would be subjected lo a twofold penalty. In point of fact, failing to meet the time-limit does not necessarily have that effect because, in those circumstances, the level of subsidy reverts to being fixed in the light of the actual price trend on the world market and thus may well be higher than that fixed in advance.

9. The four-month time-limit allowed for identification of the seed seems, moreover, reasonable and allows the trader concerned to select, during that period, the most conve nient time to undertake identification. The penalty also appears appropriately differentiated given that, other than in cases of force majeure, the security is forfeited, under Article 23(2) of Regulation No 2681/83, in proportion to the net quantity of oil seed that is not identified.

10. Finally, the fact there was in this case, as submitted by ADM, no intent to defraud on its part, is of no significance either. It is sufficient to bear in mind here that the penalty forms part of a system — on the the advance-fixing of the subsidy — for which the party concerned opts freely and in its own interest and in which the concept of intent to defraud has no place.

11. I therefore propose in the light of the foregoing considerations that the Court should answer the question submitted by the Verwaltungsgericht Frankfurt am Main as follows:

1 Original language: Italian.

2 OJ, English Special Ldition 1965 1966. p. 221

3 OJ 1983 L 163, p. 44.

4 OJ 1983 L 266, p. 1.

5 As the events material to this case loolt place in 1991, refer ence is made hereafter to the text of Articles 3 to 8 as amended bv Council Regulation No 935/86 of 25 March 1986 on the subsidy for oil seeds (OJ 1986 L 87, p. 5).

6 See most recently the judgments in Case C-127/91 CNTA [1992] ECR I-5681, paragraph 23; Case C-319/90 Pressler [1992] ECR I-203, paragraph 12, Case C-199/90 Italtrade [1991] ECR I-5545, paragraph 12; Case C 155/89 Philipp Brothers [1990] ECR I 3265, paragraph 34; and Case C-118/89 Imgenfelser 1990] ECR I-2637, paragraph 12.

7 Sec the second and fifth recitals in the preamble to Regulation (EEC) No 136/66 and the second recital in the preamble to Regulation (EEC) No 1594/83.

8 Case 66/82 [1983] ECR 395.

9 Case C-358/88 [1990] ECR I-1687.

10 Sec, inter alia, the judgments in Case 147/81 Merkur FleischImport [1982] ECR 1389; Case 15/83 Denkavil Nederland [1984] ECR 2171; Case C-155/89 Philipp Brothers, cited above; Casc C-Î99/90 Italtrade, cited above; and Case C-127/91 CNTA, cited above.

11 Sec, on this pomi, the judgment in Case 137/85 Maizena v BALM [1987] hCR 4587