CELEX: 61991CJ0114
Parafiscal charges
Compulsory contributions to a National Marketing Office for Agricultural and Horticultural Products

Grounds
1 By judgment of 22 March 1991, received at the Court on 24 April 1992, the Rechtbank van Eerste Aanleg, Ypres, referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question on the interpretation of Articles 9 and 12 of the EEC Treaty.
2 That question was raised in proceedings brought by the Belgian State against a pig-farmer concerning the legality of a compulsory contribution levied in Belgium upon the slaughter or export of pigs, for the benefit of the Office National des Débouchés Agricoles et Horticoles (National Marketing Office for Agricultural and Horticultural Products).
3 The Belgian Law of 27 December 1938 (Moniteur Belge of 26 January 1939), as amended by the Law of 11 April 1983 (Moniteur Belge of 24 September 1983), created a National Marketing Office for Agricultural and Horticultural Products ("the Office"), whose aim is to promote the development of domestic and foreign markets for agricultural and horticultural products and products of sea fishing.
4 Article 4 of that Law provides that the Office "may collect a compulsory contribution for every product or group of products ... from natural or legal persons who produce, process, transport, sell or market agricultural or horticultural products or products of sea fishing".
5 Article 3 of the Royal Decree of 31 January 1985 (Moniteur Belge of 1 March 1985), as amended by Article 4 of the Royal Decree of 23 April 1986 (Moniteur Belge of 28 May 1986), lays down the following provisions concerning compulsory contributions:
"The compulsory contributions intended for the promotion of markets for the products covered by the 'Pigs' advisory department shall be fixed as follows:
(1) Any person who slaughters or causes to be slaughtered pigs in a public or private slaughterhouse shall pay a contribution of BFR 5 per slaughtered pig.
(2) Of that contribution, BFR 2.50 per slaughtered pig shall be charged to the account of the supplier of the pigs. This contribution shall be indicated separately on the invoice.
...
(4) The contributions referred to in subparagraph 1 shall be collected through public and private slaughterhouses, which shall bear the cost thereof. The contributions shall be paid to the National Marketing Office for Agricultural and Horticultural Products.
...
(5) Exporters of live pigs shall pay a contribution of 0.04% of the export value of the exported pigs.
..."
6 Pursuant to Articles 4c and 8 of the abovementioned Law, any infringement of Article 3 constitutes a criminal offence.
7 It is apparent from the documents before the Court that, in accordance with the abovementioned Law and royal decree, the Office sought to recover the sum of BFR 2 011 425 from Westvlees, a company belonging to G. Claeys. When the latter denied owing that sum, on the ground that it related to pigs imported from the Netherlands, he was summoned to appear before the Rechtbank van Eerste Aanleg, Ypres, where he maintained that the national provisions in question were contrary to Articles 9 and 12 of the EEC Treaty.
8 In those circumstances, the national court stayed the proceedings and referred the following question to the Court of Justice for a preliminary ruling on:
"the interpretation of Articles 9 and 12 of the EEC Treaty, and in particular the question whether the words 'duties on imports' or the words 'charges having equivalent effect' , or both, apply to the contribution which must be paid pursuant to the Law of 27 December 1938, as amended by the Law of 11 April 1983, and the Royal Decree of 31 January 1985, as amended by the Royal Decree of 23 April 1986, on pigs imported into Belgium".
9 Reference is made to the Report for the Hearing for a fuller account of the relevant national legislation and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.
10 In its question, the national court refers only to the interpretation of Articles 9 and 12 of the Treaty. However, under the system created by Article 177 of the Treaty, it is for the Court, having regard to the documents before it, to give the national court an answer enabling it to resolve the dispute in the main proceedings.
11 Accordingly, having regard to the fact that, as is apparent from the documents before the Court, the case is concerned with a compulsory contribution constituting a parafiscal charge, levied in the same way on domestic and imported products and the revenue from which is in principle used for the benefit of domestic products, it is necessary first to consider Articles 12 et seq. and 95 of the Treaty, followed by Article 92.
Articles 12 et seq. and 95 of the Treaty
12 Since the Treaty provisions concerning charges having equivalent effect and those concerning discriminatory internal taxation cannot be applied concurrently (see the judgments in Case 94/74 IGAV v ENCC [1975] ECR 699 and in Joined Cases C-149/91 and C-150/91 Sanders [1992] ECR I-3899), it is necessary to determine the precise scope of each of those provisions.
13 Articles 12 and 13 of the Treaty prohibit customs duties on imports and exports in trade between the Member States and charges having equivalent effect. With regard to customs duties and charges having equivalent effect on imports, the Court has stated (judgments in Case 77/72 Capolongo [1973] ECR 611, Compagnie Commerciale de l' Ouest and Sanders, cited above) that in principle that prohibition covers all charges levied at the time of or by reason of importation, which are imposed specifically on an imported product but not on a similar domestic product. It has also held that pecuniary charges intended to finance the activities of an agency governed by public law can constitute charges having equivalent effect.
14 In the same judgments, the Court stated that, in interpreting the term "charge having an effect equivalent to a customs duty on imports", it might be necessary to take account of the use to which the pecuniary charges levied are put. When such a pecuniary charge or duty is intended exclusively to support activities which specifically benefit taxed domestic products, the result may be that the general duty levied, according to the same criteria, on the imported product and the domestic product nevertheless constitutes for one of them a net additional financial burden, whilst for the other it constitutes in reality a set-off against benefits or aid previously received. Consequently, a duty imposed under a general system of internal taxation applying systematically to domestic and imported products according to the same criteria can nevertheless constitute a charge having an effect equivalent to customs duties on imports when the revenue from that contribution is intended exclusively to support activities which specifically benefit the taxed domestic products.
15 Article 95 prohibits Member States from directly or indirectly imposing on the products of other Member States any internal taxation in excess of that imposed on similar domestic products or of such a nature as to afford protection to other domestic products. The applicability of the provision in question therefore depends on whether or not the internal taxation measure is discriminatory or protective (judgment in Compagnie Commerciale de l' Ouest, cited above, paragraph 25).
16 Where a charge is imposed on domestic and imported products according to the same criteria, the Court has consistently held that it may be necessary to take into account the purpose to which the revenue from the charge is put. Thus, if the revenue from such a charge is intended to finance activities for the special advantage of the taxed domestic product, it may follow that the charge imposed on the basis of the same criteria nevertheless constitutes discriminatory taxation in so far as the fiscal burden on the domestic products is neutralized by the advantages which the charge is used to finance, whilst the charge on the imported product constitutes a net burden (judgments in Case 73/79 Commission v Italy [1980] ECR 1533, paragraph 15, and in Compagnie Commerciale de l' Ouest, cited above, paragraph 26).
17 It follows from the foregoing considerations that if the advantages stemming from the use of the proceeds of the contribution in question fully offset the burden borne by the domestic product when it is placed on the market, that contribution constitutes a charge having an effect equivalent to customs duties, contrary to Article 12 et seq. of the Treaty. If those advantages only partly offset the burden borne by domestic products, the charge in question is subject to Article 95 of the Treaty. In the latter case, the charge would be incompatible with Article 95 of the Treaty and is therefore prohibited to the extent to which it discriminates against imported products, that is to say to the extent to which it partially offsets the burden borne by the taxed domestic product (see, most recently, the judgment in Sanders, cited above).
18 It is for the national court to determine whether the burden borne by the domestic product is wholly or partly offset by the use of the revenue from the charge in question (judgment in Compagnie Commerciale de l' Ouest, cited above, paragraph 28).
19 In view of the foregoing, it must be stated in reply to the national court that a compulsory contribution constituting a parafiscal charge, applied under the same conditions as regards its collection to both domestic and imported products, the revenue from which is used for the benefit of domestic products only, so that the advantages accruing from it wholly offset the burden borne by those products, constitutes a charge having an effect equivalent to customs duties prohibited by Article 12 of the Treaty. If those advantages only partly offset the burden borne by domestic products, such a charge constitutes discriminatory taxation prohibited by Article 95 of the Treaty.
20 Finally, the Court has consistently held that Articles 12, 13 and 95 of the Treaty have direct effect and create individual rights which the national courts must protect (judgments in Case 26/62 Van Gend & Loos [1963] ECR 1, in Capolongo, cited above, and in Case 74/76 Iannelli v Meroni [1977] ECR 557).
Article 92 et seq. of the Treaty
21 In order to give the national court a helpful answer concerning the provisions of the Treaty governing State aid, it must be observed that, although the parafiscal charge at issue may be prohibited either by Articles 12 and 13 or by Article 95 of the Treaty, the use of the revenue from it may nevertheless constitute State aid incompatible with the common market, if the conditions for the application of Article 92 of the Treaty, as interpreted by the Court in previous decisions, are met (judgments in Compagnie Commerciale de l' Ouest and in Sanders, cited above).
22 However, the Court has consistently held that the incompatibility of State aid with the common market is neither absolute nor unconditional. The intention of the Treaty, in providing through Article 93 for aid to be kept under constant review and supervised by the Commission, is that the finding that an aid may be incompatible with the common market is to be determined, subject to review by the Court, by means of an appropriate procedure which it is the Commission' s responsibility to set in motion. Individuals cannot therefore simply, on the basis of Article 92 alone, challenge the compatibility of an aid with Community law before the national courts or ask them to decide as the main or a subsidiary issue on any incompatibility (judgments in Iannelli, cited above, in Case 78/76 Steinike and Weinlig [1977] ECR 595, in Compagnie Commerciale de l' Ouest and in Sanders, both cited above).
23 Nevertheless, it is for the national courts to uphold the rights of the persons concerned in the event of a possible breach by the national authorities of the prohibition on putting aid into effect in the last sentence of Article 93(3) of the Treaty which has direct effect. Where such a breach is invoked by individuals who may rely thereon and is established by the national courts, the latter must take all the consequential measures under national law as regards both the validity of decisions giving effect to aid measures and the recovery of the financial support granted. When national courts take a decision in this connection, they do not decide on the compatibility of the aid measures with the common market, the final assessment of which is the exclusive responsibility of the Commission, subject to review by the Court of Justice (judgments in Case C-354/90 Fédération Nationale du Commerce Extérieur [1991] ECR I-5505 and in Sanders, cited above).
24 It is also for the national courts to uphold the rights of those concerned, by drawing all the inferences, in accordance with their national law, as regards the validity of measures implementing the aid in question and the recovery of the financial support granted, where the Commission finds by a decision adopted under Article 93(2) of the Treaty that a measure granting aid is incompatible with the common market (judgment in Steinike and Weinlig, cited above).
25 It must therefore be stated in reply to the national court that a parafiscal charge of the kind at issue in the main proceedings may, depending on how the revenue from it is used, constitute State aid incompatible with the common market if the conditions for the application of Article 92 of the Treaty are met, that being a matter for the Commission to determine in accordance with the procedure laid down for that purpose in Article 93 of the Treaty. In that respect, regard must also be had to the jurisdiction of the national courts where, in introducing the charge, the Member State concerned failed to comply with its obligations under Article 93(3) of the Treaty, and where a Commission decision under Article 93(2) of the Treaty has found the levying of the charge as a method of financing State aid to be incompatible with the common market.
Decision on costs
Costs
26 The costs incurred by the Belgian Government and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.
Operative part
On those grounds,
THE COURT (Sixth Chamber)
in answer to the question referred to it by the Rechtbank van Eerste Aanleg, Ypres, by judgment of 22 March 1991, hereby rules:
1. A compulsory contribution constituting a parafiscal charge, applied under the same conditions as regards its collection to both domestic and imported products, the revenue from which is used for the benefit of domestic products only, so that the advantages accruing from it wholly offset the burden borne by those products, constitutes a charge having an effect equivalent to customs duties prohibited by Article 12 of the Treaty. If those advantages only partly offset the burden borne by domestic products, such a charge constitutes discriminatory taxation prohibited by Article 95 of the Treaty.
2. Articles 12, 13 and 95 of the Treaty create rights for individuals which the national courts must protect.
3. A parafiscal charge of the kind at issue in the main proceedings may, depending on how the revenue from it is used, constitute State aid incompatible with the common market if the conditions for the application of Article 92 of the Treaty are met, that being a matter for the Commission to determine in accordance with the procedure laid down for that purpose in Article 93 of the Treaty. In that respect, regard must also be had to the jurisdiction of the national courts where, in introducing the charge, the Member State concerned failed to comply with its obligations under Article 93(3) of the Treaty, and where a Commission decision under Article 93(2) of the Treaty has found the levying of the charge as a method of financing State aid to be incompatible with the common market.