OPINION OF ADVOCATE GENERAL

JACOBS delivered on 18 September 2003(1)

Legal framework

4. The additional levy is established by Council Regulation (EEC) No 3950/92.(3) At the material time, Commission Regulation (EEC) No 536/93 (hereinafter referred to as ‘the regulation') laid down detailed rules on the application of the additional levy regarding, amongst other things, ‘the checks permitting verification of proper collection of the levy'.(4)

(f) producers with reference quantities for direct sales shall keep available to the competent authority of the Member State for at least three years stock accounts by 12-month period with details of the quantities, per month and per product, of milk and/or milk products sold directly for consumption … together with registers of livestock held on holdings and used for milk production, in accordance with Article 4(1) of Council Directive 92/102/EEC,(5) and supporting documents enabling such stock accounts to be verified.

(b) at the premises of the producers with a reference quantity for direct sales, the credibility of the declaration referred to in Article 4(1) and the stock accounts referred to in paragraph 1(f).

4. At the material time, the rules adopted by the Products Board, as referred to in Article 31 of the Superlevy Regulation, were contained in the Zuivelverordening 1994, Uitvoering regeling superheffing (1994 Milk Products Regulation, Implementation of the Superlevy Regulation, hereinafter referred to as ‘the Milk Products Regulation').(7) Article 11(1) required a producer ‘to keep records of everything regarding his business or holding in such a manner as to enable the production, stock and the quantities received and delivered of processed or manufactured milk, together with the financial data relating thereto, to be ascertained at all times …'

The facts and the question referred

10. In its order for reference, the referring court notes that the obligation imposed upon the appellant by Article 4(1) of the regulation is clearly limited to reporting quantities of milk and/or milk products sold. However, it considers it to be conceivable that the obligation to maintain stock accounts under Article 7(1)(f) might extend further to include the data at issue in the main proceedings. It has therefore stayed the proceedings before it and has referred the following question to the Court:‘Can it be inferred from Article 7(1)(f) of Regulation (EEC) No 536/93 that the producer is obliged to maintain accounts recording, among other things, the availability, production, storage, use, processing and destruction of milk and/or milk products on his holding, such “stock accounts” also being required to contain declarations of the quantity per month and per product of the milk and/or milk products sold, or does that provision only lay down an obligation to record those data as to sales?'

11. Written observations have been submitted by the Netherlands Government and the Commission, both of whom were represented at the hearing, as was the appellant.

Assessment

12. In addition to the observations before the Court which are addressed to the question referred, the Commission and the Netherlands Government made submissions at the hearing on the issue whether a Member State is competent to enact legislation imposing reporting obligations on milk producers within its territory going beyond those specified by Article 7(1)(f) of the regulation. In my view, it would not be appropriate to consider that issue in the context of the present case. It is for the referring court to determine the questions of Community law which require an answer in order for it to dispose of the proceedings before it. Moreover, the manner in which the issue was raised for the first time at the hearing was not such as to give the appellant or other potential parties an adequate opportunity to address it. I therefore propose to confine my analysis to an interpretation of the scope of Article 7(1)(f), as required by the question referred.

13. The Netherlands Government proposes an affirmative response to that question, advancing several arguments based on the text of Article 7 of the regulation in support of an extensive reading of Article 7(1)(f).

14. It notes first that Article 7(1)(f) not only requires producers to account for milk products actually sold, but also makes reference to their obligation under Article 4(1) of Council Directive 92/102 to maintain a register of their livestock. The two obligations are juxtaposed, it is argued, because they allow a comparison to be made between a producer's declared level of sales and his potential level of production.

15. However, in the view of the Netherlands Government, such a comparison would not assist in verifying that all sales were properly declared unless producers were also required to explain what has become of any milk or milk equivalent which has been produced but not sold. Article 7(1)(f) expressly requires producers to maintain ‘supporting documents enabling… stock accounts to be verified'. Given that stock accounts must clearly be capable of verification, they must therefore include all the information needed to balance production against sales.

16. The Netherlands Government also points to the obligations imposed on Member States under the introductory paragraph of Article 7(1) to take the verification measures necessary to ensure proper payment of the additional levy, and under Article 7(3) physically to verify the accuracy of the accounting relating to the sale of milk and milk equivalent, and in particular to check the credibility of stock accounts. Member States, it is suggested, could properly fulfil those obligations only if producers were required to explain the fate of any allegedly unsold production.

17. I am not convinced by the submissions of the Netherlands Government regarding the interpretation of ‘stock accounts' as that term appears in Article 7(1)(f).

19. Nor, in my view, would it be appropriate to read into Article 7(1)(f) duties which it did not explicitly lay down. Even if such duties were necessary to the proper administration of the additional levy, such an approach would run counter to the principle of legal certainty, especially given that severe consequences may follow for any producer found to have kept incomplete records.

Conclusion

21. It is therefore my opinion that the Court should respond to the question referred in the following terms: Article 7(1)(f) of Commission Regulation (EEC) No 536/93 of 9 March 1993 laying down detailed rules on the application of the additional levy on milk and milk products does not require producers to record details of the availability, production, storage, use, processing and destruction of milk and/or milk products which they have produced but not sold.

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1 – Original language: English.

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2 – OJ 1993 L 57, p. 12. That regulation has since been replaced by Commission Regulation (EC) No 1392/2001 of 9 July 2001, OJ 2001 L 187, p. 19, Article 14(5) of which is materially identical to Article 7(1)(f) of the former regulation.

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3–

Council Regulation (EEC) No 3950/92 of 28 December 1992 establishing an additional levy in the milk and milk products sector, OJ 1992 L 405, p. 1.

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4–

The second recital of the preamble to the regulation.

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5–

OJ 1992 L 355, p. 32.

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6–

<i>Staatscourant</i> (Government Gazette) 1993, p. 60.

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7–

PBO-blad 1994, p. 26.