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In Case C‑78/07,
REFERENCE for a preliminary ruling under Article 234 EC from the Consiglio di Giustizia amministrativa per la Regione siciliana (Italy), made by decision of 18 May 2006, received at the Court on 13 February 2007, in the proceedings
Assessorato all’agricoltura e foreste della Regione Sicilia,
Domenico Valvo,
THE COURT (Seventh Chamber),
composed of U. Lõhmus, President of the Chamber, P. Lindh (Rapporteur) and A. Arabadjiev, Judges,
Advocate General: Y. Bot,
Registrar: R. Grass,
having regard to the written procedure,
after considering the observations submitted on behalf of:
–the Italian Government, by I.M. Braguglia, acting as Agent, and G. Aiello, avvocato dello Stato,
–the Commission of the European Communities, by C. Cattabriga, acting as Agent,
having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,
gives the following
4. Articles 17 to 19 of Regulation No 950/97, which appear under Title IX of that regulation, entitled ‘Aid scheme to benefit less-favoured agricultural areas’, and the subheading ‘Compensatory allowances’, replace in essence the provisions of Articles 17 and 18 of Regulation No 2328/91. Those articles provide:
‘ Article 17
The application of the measures provided for in this scheme should take into account the situation and development objectives particular to each region.
Article 18
However, in the Italian Mezzogiorno region, including the islands, in the regions in the French overseas departments and in the Greek, Portuguese and Spanish regions, the minimum UAA per holding shall be two hectares.
Article 19
…
The granting of a compensatory allowance which exceeds the limits or fails to satisfy the conditions laid down in this Title shall be prohibited.
…’
6. The beneficiaries of those allowances are defined in the operational programme as farmers who work at least two hectares of usable agricultural area and undertake to pursue their farming activity for at least five years from the first application for and grant of the allowance and who are not in receipt of a retirement or early retirement pension.
–give up farming, on condition that farming activity continues;
–give up farming in cases of force majeure and in particular in cases of compulsory purchase or purchase in the public interest;
–during the period of the undertaking receive a retirement or early-retirement pension.
10. Mr Valvo brought an action for annulment of that decision before the Tribunale amminstrativo regionale per la Sicilia (Regional Administrative Court for Sicily), which upheld the action. That court held that the length-of-service pension paid to Mr Valvo is not comparable to a retirement or early-retirement pension and that Mr Valvo meets all the necessary requirements to receive the compensatory allowance. The Ispettorato Provinciale dell’Agricoltura di Enna, the Assessorato all’agricoltura e foreste della Regione Sicilia and the Regione Sicilia appealed to the referring court against that judgment at first instance.
11. As it is uncertain regarding the interpretation which should be given to Articles 17 and 18 of Regulation No 950/97, the Consiglio di Giustizia amministrativa per la Regione siciliana (Council of Administrative Justice for the Region of Sicily) decided to stay proceedings and to refer the following question to the Court of Justice for a preliminary ruling:
‘May a farmer be refused the compensatory allowance when he is also in receipt of a pension, in particular, a length-of-service pension?’
12. The facts of the main proceedings are governed, in respect of one part of the period concerned, by Regulation No 950/97 and, in respect of the other part, by Regulation No 2328/91. However, since the relevant provisions of the two regulations are substantially identical and the referring court, the Italian Government and the Commission of the European Communities refer only to Regulation No 950/97, it is sufficient to reply to the question referred on the basis of the provisions of that regulation alone.
14. Nevertheless, the Italian Government contends that, in cases where the Member State concerned has chosen not to grant a compensatory allowance where the farmer is in receipt of a retirement or early-retirement pension, payment of that allowance is precluded if the farmer is receiving a pension, in particular a length-of-service pension. The Commission, for its part, considers that the regulation does not preclude a Member State from granting a compensatory allowance to a farmer who, while pursuing his farming activity, is at the same time in receipt of a pension, including a length-of-service pension.
15. Under Article 17 of Regulation No 950/97 Member States may introduce an aid scheme, in the form of a compensatory allowance, to encourage farming and to raise incomes in certain less-favoured areas.
16. Article 18(1) of that regulation provides that Member States may grant that compensatory allowance to farmers provided that they fulfil two conditions, that is, first, that they work a minimum usable agricultural area, which is two hectares in the Italian Mezzogiorno region including the islands, and, second, that they undertake to pursue a farming activity for at least five years in accordance with the aims of Article 17 of that regulation.
19. Those provisions concern not the right of Member States to grant a compensatory allowance where a farmer is in receipt of a retirement or early-retirement pension, but only the consequences of the receipt of such a pension both for the farmer and for the European Community.
21. It is apparent from the national legislation, as it was presented to the Court, that the compensatory allowance is not granted where a farmer is in receipt of a retirement or early-retirement pension. By contrast, it does not appear that such an exclusion extends to a case where the farmer is in receipt of a length-of-service pension such as that at issue in the main proceedings.
22. However, it is not for the Court to rule on the scope of national provisions, since that task is for the referring court. The national court will therefore have to determine whether the national legislature, which exercised the right to grant a compensatory allowance to farmers who fulfil the conditions restated in paragraph 16 of this judgment and the power to include additional conditions for payment of that allowance, has precluded the grant of that allowance not only in cases where the farmer is in receipt of a retirement or early retirement pension, but also where he is in receipt of a length-of-service pension.
24. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
On those grounds, the Court (Seventh Chamber) hereby rules:
Articles 17 and 18 of Council Regulation (EC) No 950/97 of 20 May 1997 on improving the efficiency of agricultural structures confer on Member States the right to grant a compensatory allowance to a farmer who fulfils the conditions laid down in those two articles. However, those articles do not preclude a Member State from refusing payment of such an allowance where that farmer is in receipt of a pension, in particular, a length-of-service pension.