DELIVERED ON 30 MAY 1979 (1)

Mr President,

Members of the Court,

The common organization of the market in pigmeat (Regulation (EEC) No 2759/75 of the Council of 29 October 1975, Official Journal L 282 of 1 November 1975, p. 1) provides in Article 3 that intervention measures may be taken if there is a substantial fall in prices. These measures include inter alia aid in respect of private storage.

The Council, as is provided for in Article 7 of Regulation No 2759/75, laid down basic rules for that purpose in Regulation (EEC) No 2763/75 of 29 October 1975 (Official Journal L 282, p. 19); implementing provisions in that connexion were enacted in Commission Regulation (EEC) No 1889/76 of29 July 1976 (Official Journal L 206 of 31 July 1976, p. 82).

In Article 1 of Regulation No 2763/75 private storage, within the meaning of Article 3 of Regulation No 2759/75, is defined as ‘the holding in a warehouse, at their own risk and expense by natural or legal persons established in the Community … of products covered by the market in pigmeat’. It is provided in Article 1 (3) that ‘Private storage aid shall be granted in accordance with the terms of contracts concluded with intervention agencies; such contracts shall express the reciprocal obligations of the contracting parties in standard terms for each product’. In accordance with Article 4 of the regulation ‘only applicants who have given security for the fulfilment of their contract obligations by lodging a deposit which shall be forfeited in whole or in part if these are not fulfilled or are only partially fulfilled’ are permitted to conclude storage contracts.

In Article 3 of the said Commission Regulation (No 1889/76) it is provided that every contract shall contain inter alia details on ‘the form and amount of the security’ and must in particular impose the following obligations on the private storer: ‘(a) at his own risk and expense to take the agreed quantity of the product into store within the time-limits laid down and to store it for the stipulated period …’ and ‘(c) to forward to the intervention agency without delay the documents relating to the various storage operations’. Article 5 (2) provides:

‘The security shall be wholly forfeit if the obligations imposed by the contract are not fulfilled’.

Finally, it is stated in Article 6 (2) and (3) of the regulation:

‘2. Without prejudice to the other obligations of the storer, aid may only be claimed if the obligations set out in Article 3 (2) (a) are fulfilled in their entirety.

In the Netherlands the intervention agency within the meaning of Article 4 (3) of Regulation No 2759/75, at all events for certain specified operations, is the Voedselvoorzieningsin- en verkoop-bureau (Office for the purchase and sale of food supplies, hereinafter referred to as ‘the V.I.B.’) which is responsible to the Ministry of Agriculture and Fisheries. In Notice No 9/77 the V.I.B. stated the conditions which contracts concerning the granting of private storage aid for pigmeat must fulfil. That notice requires the products stored to be listed each week on a special form, set out separately according to each product and refrigerated store. It is further required that the list, together with proof of entry into storage, be sent to the V.I.B. so as to arrive within one week of entry into store.

The appellant in the main action, Atalanta Amsterdam B.V., concluded a series of contracts in 1977 with that intervention agency concerning the granting of private storage aid for pigmeat. As it was stated without challenge in the main action, the appellant entirely fulfilled the obligations under Article 3 (2) (a) of Regulation No 1889/76 (delivery of the product into store within the time-limits and storage for the stipulated period). However, the necessary proof of the entry into store of certain consignments was not sent to the V.I.B. in good time, within the meaning of the said Notice No 9/77; the said agency considers this to constitute a failure to fulfil in their entirety the obligations laid down in Article 3 (2) (c) of Regulation No 1889/76. The V.I.B. accordingly notified the appellant on 1 November 1977 that it had forfeited its deposit. With regard to the payment of a storage aid the appellant was required to apply to the Produktschap voor Vee en Vlees [Board for Cattle and Meat] which was competent in that sphere.

When the appellant lodged a request to this effect with the Produktschap, concerning the forfeiture of the deposit, it was notified by a letter of 15 November 1977 that it had failed to quality for a storage aid because it had not produced the necessary proof of entry into store in good time.

The appellant then instituted proceedings before the College van Beroep voor het Bedrijfsleven [administrative court of last instance in matters of trade and industry] concerning both the refusal of the aid and the forfeiture of the deposit. In those proceedings the Produktschap explained that it had been unwilling to take a decision in its letter of 15 November 1977 concerning the forfeiture of the deposit because such forfeiture fell within the competence of the V.I.B. The College, in its judgment of 1 November 1978, stayed the proceedings and, in accordance with the third paragraph of Article 177 of the EEC Treaty, referred the following questions to the Court for a preliminary ruling:

‘I Does it follow from the provisions and the scope of Regulation (EEC) No 2759/75 of the Council, Regulation (EEC) No 2763/75 of the Council — in particular Article 1 (3) — and Commission Regulation (EEC) No 1889/76 — in particular Article 3 (2), Article 4 (2) and Article 8 — that the power to take decisions for the implementation and application of the granting of private storage aid for pigmeat provided for and regulated in those regulations, including the rules in respect of the provision and the possible forfeiture of deposits, is exclusively held by the national intervention agencies,

or must the provisions and the scope thereof be understood as meaning that the power to take decisions in respect of the implementation and application of the rules laid down by those provisions both in respect of the granting of aid and in respect of deposits, or else solely in respect of the granting of aid, is held by the national Member States, albeit with the obligation to grant the aid in accordance with the contract concluded with the relevant intervention agency?

II Properly interpreted, does Article 6 (2) and (3) of Commission Regulation (EEC) No 1889/76 signify that the storer

(1) has a right to aid if the obligations referred to in Article 3 (2) (a) of the aforesaid regulation are fulfilled in their entirety,

and (2) has a right to payment of the amount of aid once it has been ascertained that the contractual obligations have been fulfilled and, inter alia, the proof of storage has been sent to the intervention agency, although this was not done “without delay”,

or must the aforesaid Article 6 (2) and (3) be interpreted as signifying that although all the obligations set out in Article 3 (2) of the aforesaid regulation have been fulfilled the storer nevertheless is not entitled to aid if the proof of storage referred to in Article 3 (2) (c) of the regulation was sent to the relevant intervention agency but not “without delay”?

III Must the term “obligations” in Article 4 (2) (b) of Regulation (EEC) No 2763/75 be understood as including only obligations to put into store and to store pigmeat or must that term be understood as including also subsidiary obligations with regard to information and supervision?

Must the term “obligations” in Article 5 (2) of Regulation (EEC) No 1889/76 be understood as including only the obligations to put into store and to store pigmeat or must that term be understood as including also the obligations referred to in Article 6 (2) (b) to (e) of the last-mentioned regulation?

If Article 4 (2) (b) of Regulation (EEC) No 2763/75 must be understood as signifying that the term “obligations” used there includes only the obligations to put into store and to store pigmeat but in Article 5 (2) of Regulation (EEC) No 1889/76 the same term is to include the obligations described in Article 3 (2) (b) to (e) of that regulation is the aforesaid Article 5 (2) valid in that respect?

IV Must Article 5 (2) of Regulation (EEC) No 1889/76 be interpreted as meaning that the security shall be forfeit in its entirety if the failure to fulfil the relevant principal or subsidiary obligations was only partial?

If Question I is answered in the affirmative is Article 5 (2) in that respect compatible with Article 4 (2) (b) of Regulation (EEC) No 2763/75 wherein it is provided in respect of deposits that they shall be forfeited in whole or in part “if [the contractual obligations] are not fulfilled or are only partially fulfilled” and if not is Article 5 (2) in that respect invalid?’

My views on these questions are as follows:

“The intervention agencies designated by the Member States shall take intervention measures under the conditions laid down in Articles 5 to 7”.

According to Article 1 (3) of Regulation No 2763/75 “Private storage aid shall be granted in accordance with the terms of contracts concluded with intervention agencies”. Furthermore, in Article 3 (2) (b), (c) and (e), Article 4 (2) and Article 8 of Regulation No 1889/76 reference is made to the “competent intervention agency”.

In my view the Commission and the respondent in the main action are, however, correct in pointing out that this does not refer to a particular national agency. I also find persuasive the view that the Community legislature did not intend to lay down in the said provisions that the intervention measures in question could be taken by one body alone, that is, that it was not permissible to assign the duties to different agencies.

In this connexion I wish to recall the principles governing the way in which Community law and national law operate together specifically in the sphere of agriculture. In accordance with those principles Community law restricts itself generally to laying down the most important basic rules whilst the Member States are required to adopt the necessary implementing measures in such form as appears to them appropriate and to lay down a suitable procedure. Thus it has been emphasized in the case-law of the Court that the Member States are required to decide which bodies are empowered within the domestic legal system to adopt measures for the fulfilment of obligations under Community law and that the question of how the exercise of powers or fulfilment of obligations under provisions of the Treaty or of regulations may be entrusted by Member States to specific national bodies is solely a matter for the constitutional system of each State (see Joined Cases 51 to 54/71 International Fruit Company v Produktschap voor Groenten en Fruit, judgment of 15 December 1971 [1971] 2 ECR 1116).

It cannot be conceded that the situation should be different for the market in pigmeat. Indeed, in Article 4 (3) of the basic Regulation No 2759/75 an entirely general reference is made to the intervention agencies designated by the Member States. Likewise the wording adopted in Article 1 (3) of Regulation No 2763/75 (“in accordance with the terms of contracts concluded with intervention agencies”) certainly does not refer to a specific national agency.

It is, then, sufficient for the purposes of Community law that the agencies designated by the Member States should have an intervention function, as is the case when specified duties are entrusted to them in connexion with the granting of private storage aid (conclusion of contracts, payment of aid) or when they have powers in connexion with the lodging and forfeiture of deposits.

Likewise it is unobjectionable for the purposes of Community law that the duties should be divided and that, as in the present case, one agency (the Produktschap) should have general competence concerning aid whilst another (the V.I.B.) is required to take decisions concerning deposits, since it concludes the storage contracts and is better placed to appraise the implementation of the contracts. It is not my impression that in this way excessive difficulties arise with regard to participation in the requisite intervention measures, or that traders are hampered, in particular in comparison with those concerned in other Member States. Likewise I have no objections concerning the possibility of a conflict of decisions or the fact that various branches of the judicial system have jurisdiction. In this connexion, indeed, reference has properly been made to the duty of the Member States, which flows in general terms from Article 5 of the EEC Treaty and in particular from the common organizations of the agricultural markets, to refrain from impeding the functioning of the common organizations of the market. However, such a risk has hitherto shown no sign of materializing and, as we heard in the oral procedure, despite the absence of express legal provisions or any institutional connexion between the various competent agencies effective co-operation between those agencies is maintained through continuous and close contact, whereby as it appears the V.I.B. co-ordinates its decisions with those of the Produktschap. Furthermore, uniformity in the application of Community law is ensured through the jurisdiction of the Court of Justice in matters of interpretation which applies to all branches of the judicial system.

Accordingly, the first question of the College van Beroep may as a matter of principle be answered in terms of the second alternative contained in the question.

In this connexion the Commission has rightly pointed out that the Community regulations lay down binding rules governing contractual relations concerning the private storage of pigmeat, which is to be considered as an intervention measure, and accordingly to a certain degree replace the domestic law of contract. The Community provisions also leave open the appraisal of the distinction to be drawn with regard to the intervention measures in question between the principal and subsidiary obligations of persons who wish to benefit from those measures.

The obligation contained in Article 3 (2) (a) of Regulation No 1889/76 of the Commission, namely ‘at his [the private storer's] own risk and expense to take the agreed quantity of the product into store within the time-limits laid down and to store it for the stipulated period’, is plainly to be considered as the principal obligation. This is clearly to be deduced from Article 6 (2) of that regulation which provides that, without prejudice to the other obligations of the storer, aid may only be claimed if the obligations set out in Article 3 (2) (a) are fulfilled in their entirety. In fact that provision leaves no doubt that the sole condition attached to the right to aid is that the obligations concerning storage have been fulfilled. If the acquisition of that right were in fact conditional upon the fulfilment of ail the contractual obligations the wording adopted in Article 6 (2) of the regualtion of the Commission, namely ‘without prejudice to the other obligations of the storer’, would certainly not have been used and express reference would have been made to all the obligations under Article 3 (2) and not only those mentioned in subparagraph (a).

On the other hand, as is clear from Article 6 (3), which is clearly distinguished from Article 6 (2) and contains an entireley independent statement, the aid is only paid when it has been ascertained that all the conditions of the contract have been fulfilled, which covers fulfilment of the obligation under Article 3 (2) (c) to produce documentary evidence. According to the general system of the regulation the last-mentioned obligation thus constitutes only a subsidiary obligation which merely serves efficient administration and is intended to enable the competent bodies to exercise the necessary supervision.

In view of these considerations and having regard to the various interests concerned it would certainly be inappropriate to classify the provision as to time in Article 3 (2) (c) — the sending without delay of the documents relating to the storage — as a prescriptive time-limit in the sense that failure to observe it entails forfeiture of the right to aid. That would constitute a glaring contrast to the clear statement contained in Article 6 (2) and would completely eliminate the distinction which the authors of the legislation wished to draw between the creation of the right and its execution. Furthermore, the Commission has rightly recalled that in accordance with the general system of the rules the fulfilment of the obligation to provide proof in good time can be ensured effectively by other means, namely through forfeiture of part of the deposit lodged. there is no doubt that such a penalty is sufficient in relation to that duty, which must be considered a subsidiary obligation of the storer, and is the only one which is in accordance with the principle of proportionality, which is important in this connexion. Furthermore, the fact should also be borne in mind — I make this point with some diffidence since its clarification was not requested — that the expression ‘in good time’ as understood by the regulation of the Commission, which in fact employs the words ‘without delay’, need not mean that the time-limit of one week laid down by the Netherlands intervention agency must in all circumstances be complied with and that, in accordance with the circumstances, a longer or shorter period might instead be appropriate.

Accordingly, the second question should be answered to the effect that a right to payment of the aid following due fulfilment of all the contractual obligations may be claimed despite a failure to comply with the time-limit for sending the documents relating to storage, which is to be considered as a mere procedural provision, contained in Article 3 (2) (c) of Commission Regulation No 1889/76.

I can deal with this point quite succinctly.

In my view the wording of Article 4 (2) (b), which deals with the conclusion of contracts and then with security for the fulfilment of the contract obligations, shows clearly that the lodging of the deposit is intended to provide security for the fulfilment of all contract obligations, that is, not only the principal obligations which are laid down in Article 3 (2) (a) of Regulation No 1889/76, but also the subsidiary obligations, and in particular those set out in subparagraph (c) concerning the sending without delay of the documents relating to the storage operations. There are also good reasons for the foregoing since the subsidiary obligations are also important — those contained in subparagraph (c) being so in particular with regard to effecting the necessary supervision — and accordingly it seems inconceivable that they should not be accompanied by penalties.

The implementing regulation of the Commission is also to be interpreted in that manner. Since in Article 5 (2) an entirely general reference is made to the obligations imposed by the contract and nothing in the regulation on its preamble indicates that only the principal obligations could be intended it must be accepted that the forfeiture of the deposit applies to failure to observe any obligation under the contract.

This is accordingly the reply to be given to the third question. In addition, it is clear that on this interpretation it is unnecessary to broach the question of the validity of Article 5 (2) of Regulation No 1889/76. The question would not in fact arise unless the obligations mentioned in Article 4 (2) (b) of Regulation No 2763/75 of the Council, for which security in the form of a deposit must be given, were to be understood as referring only to the principal obligations concerning taking into store and storage, whilst forfeiture of the deposit, prescribed in the regulation of the Commission, applied to all obligations.

It seems clear on the basis of the wording of the said provision, which has already been cited in another context, that this question must be answered in the affirmative. However, the Commission has convincingly shown that it is impossible in so superficial a manner to establish properly its true legal purport. It should in fact be borne in mind that the Commission regulation was adopted exclusively in implementation in particular of Regulation No 2763/75 of the Council. It must accordingly be interpreted in the light of that regulation of the Council and in particular of Article 4 (2) (b) thereof, since it is to be assumed that it remains within the framework of that regulation of the Council, being purely subsidiary to it. Furthermore, it is necessary in interpreting the Commission regulation to have regard to the above-mentioned principle of proportionality which also applies in Community law and which the Commission must be assumed to have intended to observe in adopting implementing provisions. With regard to that principle it was recently pointed out, as the Court is aware, in the judgment in Case 122/78 (S.A. Buitoni v Fonds d'Orientation et de Régularisation des Marchés Agricoles, judgment of 20 February 1979) that it precludes forfeiture of the deposit in its entirety where there has merely been a failure to provide evidence of importation within the prescribed period.

If this is borne in mind, and it is considered in particular that reference is also made in Article 4 (2) (b) of Regulation No 2763/75 of the Council to partial forfeiture of the deposit, there is scarcely room for doubt that such partial forfeiture of the deposit must also be possible under Article 5 (2) of Regulation No 1889/76 of the Commission, which moreover is shortly to be expressly amended to this effect, as we have heard. This has to be borne in mind in particular if the documents concerning entry into store of only pan of the quantity covered by the contract are not furnished or if the storer fails to honour this undertaking, which is to be considered as a merely subsidiary obligation, in good time.

5. In conclusion, the questions submitted by the College van Beroep voor het Bedrijfsleven for a preliminary ruling may be answered as follows:

(a) Regulations Nos 2759/75, 2763/75 and 1889/76 are to be interpreted as meaning that it is for the Member States to decide which national agencies are to exercise the powers of decision for which provision is made in the said regulations in connexion with the payment of storage aids and the rules on deposits.

(b) Pursuant to Article 6 (2) and (3) of Regulation No 1889/76 a storer is entitled to aid, even though he has failed to send documentary evidence of storage to the intervention agency in good time, provided that all the obligations contained in Article 3 (2) (a) of that regulation have been fulfilled in their entirety; the aid is payable when it is established that all the obligations under the contract, including these concerning the sending of documentary evidence of storage, have been fulfilled.

(c)

The term ‘obligations’ within the meaning of Article 4 (2) (b) of Regulation No 2763/75 and Article 5 (2) of Reguation No 1889/76 is to be understood as including all the obligations set out in Article 3 (2) (a) to (e) of Regulation No 1889/76.

Article 5 (2) of Regulation No 1889/76 is to be interpreted as meaning that the security shall be forfeit wholly or in part if the obligations under the contract are not fulfilled or are only partially fulfilled.

(1) Translated from the German.