# C_2014212EN.01000901.xml

| 7.7.2014 | EN | Official Journal of the European Union | C 212/9 |
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7.7.2014

EN

Official Journal of the European Union

C 212/9

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Judgment of the Court (Ninth Chamber) of 15 May 2014 (request for a preliminary ruling from the Kúria — Hungary) — Szatmári Malom Kft v Mezőgazdasági és Vidékfejlesztési Hivatal Központi Szerve

(Case C-135/13) (1)

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((Agriculture - EAFRD - Regulation (EC) No 1698/2005 - Articles 20, 26 and 28 - Support for the modernisation of agricultural holdings and support for adding value to agricultural and forestry products - Eligibility conditions - Competence of the Member States - Support for the modernisation of existing mill capacity - Mills replaced with a single new mill, with no increase in capacity - Not included - Principle of equal treatment))

2014/C 212/09

Language of the case: Hungarian

Referring court

Referring court

Kúria

Parties to the main proceedings

Parties to the main proceedings

Applicant: Szatmári Malom Kft

Applicant:

Defendant: Mezőgazdasági és Vidékfejlesztési Hivatal Központi Szerve

Defendant:

Re:

Re:

Request for a preliminary ruling — Kúria — Interpretation of Art. 20(b)(iii), and Arts. 26(1)(a) and 28(1)(a) of Regulation (EC) No 1698/2005 of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (OJ 2005 L 277, p. 1) — Support targeting the competitiveness of the agricultural and forestry sector — Measures aimed at restructuring and developing physical potential and promoting innovation — Creation by a company, whose main activity is the manufacture of flour, of a new mill by pooling production capacity of its three existing mills whose closure is planned — Modernisation of agricultural holdings or adding value to agricultural products

Operative part of the judgment

Operative part of the judgment

| 1. | Article 26(1)(a) of Council Regulation (EC) No 1698/2005 of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) must be interpreted as meaning that the concept of improvement in the overall performance of the agricultural holding, as referred to in that provision, cannot cover an operation whereby an undertaking whose business is the operation of mills closes old mills in order to replace them with a new mill, but with no increase in existing capacity; |
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1.

Article 26(1)(a) of Council Regulation (EC) No 1698/2005 of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) must be interpreted as meaning that the concept of improvement in the overall performance of the agricultural holding, as referred to in that provision, cannot cover an operation whereby an undertaking whose business is the operation of mills closes old mills in order to replace them with a new mill, but with no increase in existing capacity;

| 2. | Articles 20(b)(iii) and 28(1)(a) of Regulation No 1698/2005 must be interpreted as meaning that an operation consisting in the closure of old mills and their replacement with a new mill, but with no increase in existing capacity, may improve the overall performance of the enterprise for the purposes of the latter provision; |
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2.

Articles 20(b)(iii) and 28(1)(a) of Regulation No 1698/2005 must be interpreted as meaning that an operation consisting in the closure of old mills and their replacement with a new mill, but with no increase in existing capacity, may improve the overall performance of the enterprise for the purposes of the latter provision;

| 3. | Article 28(1)(a) of Regulation No 1698/2005 must be interpreted as not precluding, in principle, the adoption of national legislation, such as that at issue in the main proceedings, introducing support for the adding of value to agricultural products, which, as regards milling undertakings, can be granted only for operations intended to modernise the existing capacity of those mills and not for those involving the creation of new capacity. However, when considering a situation such as that at issue in the main proceedings, in which one or more milling facilities are closed in order to be replaced with a new milling facility, but with no increase in existing capacity, it is for the national court to ensure that such legislation is applied in such a way as to ensure observance of the principle of equal treatment. |
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3.

Article 28(1)(a) of Regulation No 1698/2005 must be interpreted as not precluding, in principle, the adoption of national legislation, such as that at issue in the main proceedings, introducing support for the adding of value to agricultural products, which, as regards milling undertakings, can be granted only for operations intended to modernise the existing capacity of those mills and not for those involving the creation of new capacity. However, when considering a situation such as that at issue in the main proceedings, in which one or more milling facilities are closed in order to be replaced with a new milling facility, but with no increase in existing capacity, it is for the national court to ensure that such legislation is applied in such a way as to ensure observance of the principle of equal treatment.

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(1)  OJ C 171, 15.6.2013.

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