# C_2015354EN.01002201.xml

| 26.10.2015 | EN | Official Journal of the European Union | C 354/22 |
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Action brought on 6 August 2015 — European Commission v Italian Republic

(Case C-433/15)

(2015/C 354/25)

Language of the case: Italian

Parties

Applicant: European Commission (represented by: P. Rossi, D. Nardi and J. Guillem Carrau, acting as Agents)

Defendant: Italian Republic

Form of order sought

| — | (a)
declare that, by failing to ensure that the additional levy payable in respect of quantities produced in Italy in excess of the national quota from the first year in which the additional levy was in fact applied in Italy (1995/1996) until the last year in which there was surplus production in Italy (2008/2009) was in fact charged to the account of the individual producers who had contributed to each of the production overruns and that it was paid at the appropriate time, upon their being given notification of the amount payable, by the purchaser or the producer in the case of direct sales or, where the levy was not paid within the period prescribed, registered and, where possible, collected by way of enforcement from those purchasers or producers, the Italian Republic has failed to fulfil the obligations imposed on it by the relevant provisions of EU law applicable in the years concerned, in particular: (i) Articles 1 and 2 of Regulation (EEC) No 3950/92( 1 ), (ii) Article 4 of Regulation (EC) No 1788/2003( 2 ), (iii) Articles 79, 80 and 83 of Regulation (EC) No 1234/2007( 3 ), and, with regard to the Commission’s implementing provisions, (iv) Article 7 of Regulation (EEC) No 536/1993( 4 ), (v) Article 11(1) and (2) of Regulation (EC) No 1392/2001( 5 ), and (vi) Articles 15 and 17 of Regulation (EC) No 595/2004( 6 ); | (a) | declare that, by failing to ensure that the additional levy payable in respect of quantities produced in Italy in excess of the national quota from the first year in which the additional levy was in fact applied in Italy (1995/1996) until the last year in which there was surplus production in Italy (2008/2009) was in fact charged to the account of the individual producers who had contributed to each of the production overruns and that it was paid at the appropriate time, upon their being given notification of the amount payable, by the purchaser or the producer in the case of direct sales or, where the levy was not paid within the period prescribed, registered and, where possible, collected by way of enforcement from those purchasers or producers, the Italian Republic has failed to fulfil the obligations imposed on it by the relevant provisions of EU law applicable in the years concerned, in particular: (i) Articles 1 and 2 of Regulation (EEC) No 3950/92( 1 ), (ii) Article 4 of Regulation (EC) No 1788/2003( 2 ), (iii) Articles 79, 80 and 83 of Regulation (EC) No 1234/2007( 3 ), and, with regard to the Commission’s implementing provisions, (iv) Article 7 of Regulation (EEC) No 536/1993( 4 ), (v) Article 11(1) and (2) of Regulation (EC) No 1392/2001( 5 ), and (vi) Articles 15 and 17 of Regulation (EC) No 595/2004( 6 ); |
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| (a) | declare that, by failing to ensure that the additional levy payable in respect of quantities produced in Italy in excess of the national quota from the first year in which the additional levy was in fact applied in Italy (1995/1996) until the last year in which there was surplus production in Italy (2008/2009) was in fact charged to the account of the individual producers who had contributed to each of the production overruns and that it was paid at the appropriate time, upon their being given notification of the amount payable, by the purchaser or the producer in the case of direct sales or, where the levy was not paid within the period prescribed, registered and, where possible, collected by way of enforcement from those purchasers or producers, the Italian Republic has failed to fulfil the obligations imposed on it by the relevant provisions of EU law applicable in the years concerned, in particular: (i) Articles 1 and 2 of Regulation (EEC) No 3950/92( 1 ), (ii) Article 4 of Regulation (EC) No 1788/2003( 2 ), (iii) Articles 79, 80 and 83 of Regulation (EC) No 1234/2007( 3 ), and, with regard to the Commission’s implementing provisions, (iv) Article 7 of Regulation (EEC) No 536/1993( 4 ), (v) Article 11(1) and (2) of Regulation (EC) No 1392/2001( 5 ), and (vi) Articles 15 and 17 of Regulation (EC) No 595/2004( 6 ); | | |

| — | (b)
order Italian Republic to pay the costs. | (b) | order Italian Republic to pay the costs. |
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| (b) | order Italian Republic to pay the costs. | | |

Pleas in law and main arguments

In support of its claim, the Commission submits that, according to the figures provided by the Italian authorities or, in any event, acquired in the course of the pre-litigation procedure, the total amount of the additional levy yet to be recovered is EUR 1  343 million. The total amount of the additional levy actually recovered is approximately EUR 282 million out of a total levy charged of approximately EUR 2  305 million, during the period from the first marketing year in which the additional levy system was formally introduced in Italy (1995/1996) until the last year in which surplus production was recorded (2008/2009). After deduction of the amounts covered by instalment plans (EUR 469 million) and sums written off (EUR 211 million), the ratio of the levy actually collected to the levy still to be recovered, net of sums that are the subject of instalment plans and amounts written off, is 21 %. In essence, the sums actually recovered represent less than a quarter of those still to be recovered at the date set out in the reasoned opinion.

The Commission states that the percentage of the sums actually recovered vis-à-vis the sums charged for each marketing year concerned, net of sums that are the subject of instalment plans and sums written off, shows that the system for the application of the additional levy is ineffective (given that it was generally below 21 %) during the period under consideration, notwithstanding the fact that, by the end of the period laid down in the reasoned opinion, more than five years had elapsed since the end of the last marketing year in which there was a production surplus in Italy.

With regard to the justification put forward by Italy, to the effect that the actual recovery of the sums payable by way of the levy has been hindered by numerous actions still pending which the debtors have brought in respect of claims for payment, the Commission has presented figures relating to the sums actually recovered vis-à-vis the sums outstanding in respect of which the payments in question are not contested, for each marketing year concerned. The figures show that, out of a total of approximately EUR 1  068 million payable, only EUR 241 million has been recovered, corresponding to 23 % of the amount that may be claimed, for which there is no justification.

Given that the function of the additional levy is to discourage milk production that exceeds national reference quantities (NRQ), the continuing failure to recover such large sums 20 years after the introduction of the production quota system in Italy and six years since the last NRQ was exceeded in Italy has deprived the additional levy system of the effectiveness intended by the legislature, as also demonstrated by the fact that the NRQ was repeatedly exceeded in each marketing year between the years 1995/1996 and 2008/2009.

The Commission maintains that the failure to recover such large sums relating to the additional levy may be attributed to specific acts of negligence on the part of the Italian Republic, which explain the lack of effectiveness of the scheme for charging the additional levy in Italy during the period in question.

In the first place, the legislative confusion which characterised the Italian implementing rules caused a delay in the effective implementation of the levy system in Italy and an abnormally large volume of legal proceedings, which have had the effect of precluding the collection of the levy due to the suspension of payments ordered by the national courts as a protective measure.

In the second place, Italy has failed to make effective use of all the administrative mechanisms available for the effective recovery of the sums payable by way of the levy, such as offsetting. A scheme providing for the possibility of offsetting the levies to be collected against aid to be granted under the common agricultural policy has been introduced in an ineffective and belated manner and Italian laws are still in force today which hinder the implementation of that scheme.

In the third place, collection procedures have, for the most part, been blocked from the entry into force of Law 33/2009 to date, due to the absence of implementing provisions or contractual agreements between the authorities and the bodies involved which are necessary for the resumption of those procedures.

In the fourth place, it is apparent to the Commission that, as a result of methodological errors on the part of the authorities responsible for recovery, sums that are recoverable have been regarded, incorrectly, as not recoverable, thus giving rise to further failings in the effectiveness of the collection of the additional levy.

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( 1 )  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).

( 2 )  Council Regulation (EC) No 1788/2003 of 29 September 2003 establishing a levy in the milk and milk products sector (OJ 2003 L 270, p. 123).

( 3 )  Council Regulation (EC) No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (Single CMO Regulation) (OJ 2007 L 299, p. 1).

( 4 )  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 (OJ 1993 L 57, p. 12).

( 5 )  Commission Regulation (EC) No 1392/2001 of 9 July 2001 laying down detailed rules for applying Council Regulation (EEC) No 3950/92 establishing an additional levy on milk and milk products (OJ 2001 L 187, p. 19).

( 6 )  Commission Regulation (EC) No 595/2004 of 30 March 2004 laying down detailed rules for applying Council Regulation (EC) No 1788/2003 establishing a levy in the milk and milk products sector (OJ 2004 L 94, p. 22).

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