Opinion of the Advocate General — ECLI:EU:C:2024:365
Date: 2024-04-25
Language of the case: German
Procedure: Reference for a preliminary ruling
Origin: Germany

Summary C-239/23 – 1 
Case C-239/23 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged: 
17 April 2023 
Referring court: 
Verwaltungsgericht Sigmaringen (Germany) 
Date of the decision to refer: 
28 March 2023 
Applicant: 
Karl und Georg Anwander GbR Güterverwaltung 
Defendant: 
Land Baden-Württemberg 
  
Subject matter of the main proceedings 
EAGF and EAFRD – Regulation (EU) No 1305/2013 – Compensatory allowance 
for land in mountain areas and certain areas facing constraints – Eligibility 
conditions – Programme area – Implementation of an operation outside the 
programme area – Administrative regulations 
Subject matter and legal basis of the request 
Interpretation of EU law, Article 267 TFEU 
Questions referred for a preliminary ruling 
1. Is a national administrative regulation and support practice whereby the 
payment of a compensatory allowance for land in mountain areas and certain 
areas facing constraints is precluded solely because the land to be supported 
by the compensatory allowance is outside the region of the Member State, 
within the meaning of point (b) of the second subparagraph of Article 2(1) 
EN 
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of Regulation (EU) No 1305/2013, that grants the compensatory allowance 
compatible with the first subparagraph of Article 31(1), Article 31(2), 
Article 32(1)(a), the first subparagraph of Article 32(2) and the second and 
third subparagraphs of Article 32(3) of Regulation (EU) No 1305/2013? Is 
the place of business of the farmer managing the land a permissible criterion 
for differentiation in that regard? 
2. Is the first subparagraph of Article 31(1) of Regulation (EU) No 1305/2013 
to be interpreted as meaning that the rules of a Member State or a region of 
the Member State which has decided to grant payments to farmers in 
mountain areas and other areas facing constraints, within the meaning of 
Article 31(1) of Regulation (EU) No 1305/2013, must be defined in such a 
way that the payment must also be granted in respect of land that has been 
classified as a mountain area or other area facing constraints, within the 
meaning of Article 32(1) of Regulation (EU) No 1305/2013, by another 
Member State or another region of the same Member State which has also 
decided to grant payments to farmers in mountain areas and other areas 
facing constraints within the meaning of Article 31(1) of Regulation (EU) 
No 1305/2013? 
3. Are the first subparagraph of Article 31(1) and Article 31(2) of Regulation 
(EU) No 1305/2013 to be interpreted as meaning that, in principle, a farmer 
derives directly from those provisions an entitlement under EU law to the 
grant of the payment (compensatory allowance) by the Member State or the 
region of the Member State if the farmer is an active farmer and manages 
land which has been classified as a mountain area or other area facing 
constraints, within the meaning of Article 32(1) of Regulation (EU) 
No 1305/2013, by the Member State or the region of the Member State and 
the Member State concerned or the region thereof has decided to grant 
payments (compensatory allowances) within the meaning of the first 
subparagraph of Article 31(1) of Regulation (EU) No 1305/2013? 
If that question is answered in the affirmative: 
(a) Against whom is the entitlement under EU law derived from 
Article 31(1) of Regulation (EU) No 1305/2013 directed? Is it always 
directed against the Member State itself or, in any event, against the 
region (point (b) of the second subparagraph of Article 2(1) of 
Regulation (EU) No 1305/2013) of the Member State if the region has 
decided, independently of the Member State, to grant compensatory 
allowances to farmers pursuant to Article 31 of Regulation (EU) 
No 1305/2013? 
(b) Does the entitlement under EU law require, in principle, that the 
farmer meets further requirements in excess of those laid down in the 
first subparagraph of Article 31(1) and Article 31(2) of Regulation 
(EU) No 1305/2013, which are stipulated by the Member State 
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granting the compensatory allowance or the region thereof in its 
national implementing measures? 
4. If Question 3 is answered in the negative: 
Is the first subparagraph of Article 31(1) of Regulation (EU) No 1305/2013 
to be interpreted as meaning that the rules of a Member State or one of its 
regions laying down the conditions for the grant of the payment 
(compensatory allowance) within the meaning of the first subparagraph of 
Article 31(1) of Regulation (EU) No 1305/2013 must have such legal status 
that farmers are entitled to the grant of the payment (compensatory 
allowance) if they meet the conditions for payment laid down by the 
Member State in question or the regions thereof, irrespective of the actual 
support practice of the Member State or the region thereof? 
Provisions of European Union law relied on 
Regulation (EU) No 1305/2013 of the European Parliament and of the Council of 
17 December 2013 on support for rural development by the European Agricultural 
Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) 
No 1698/2005, in particular Article 31(1) and (2), Article 32(1) to (3) 
Provisions of national law relied on 
Verordnung über die Durchführung von Stützungsregelungen und des Integrierten 
Verwaltungs- und Kontrollsystems (Ordinance on the implementation of support 
schemes and the Integrated Administration and Control System, InVeKoSV) of 
24 February 2015, Paragraph 2(2) 
Legislation of the Land of Baden-Württemberg: Verwaltungsvorschrift des 
Ministeriums Ländlicher Raum zur Förderung landwirtschaftlicher Betriebe in 
Berggebieten und in bestimmten benachteiligten Gebieten (Administrative 
regulation of the Ministry of Rural Affairs on support for farms in mountain areas 
and in certain areas facing constraints, VwV AZL) of 6 November 2019, 
Paragraphs 2.1, 3.2, 3.2.1, 4.2 
Succinct presentation of the facts and procedure 
1 The applicant is seeking a compensatory allowance for agricultural land in 
Bavaria. It operates a dairy farm in the border area between the Länder of Baden-
Württemberg and Bavaria. Its registered office is in Baden-Württemberg. It farms 
around 111 hectares of land in Baden-Württemberg and 27.4253 hectares of land 
in Bavaria. Baden-Württemberg and Bavaria are regions within the meaning of 
point (b) of the second subparagraph of Article 2(1) of Regulation No 1305/2013, 
both at the ‘NUTS 1’ level for the Federal Republic of Germany in accordance 
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with Regulation (EC) No 1059/2003, and constitute autonomous states. According 
to the competent Bavarian authority, the applicant’s land in Bavaria is located in a 
mountain area; it has been identified in Bavaria as eligible land and could 
theoretically receive support in Bavaria through a compensatory allowance of 
EUR 50 per hectare. 
2 The financial resources made available by the defendant for the payment of 
compensatory allowances come in varying proportions from EAFRD budgetary 
resources, resources of the Federal Republic of Germany and the defendant’s own 
resources. The defendant’s support programmes – including for compensatory 
allowances – are described in the Measures and Development Plan for Rural 
Areas in Baden-Württemberg 2014-2020 (MEPL III), which was approved by the 
Commission on 26 May 2015. 
3 On 8 May 2019, the applicant applied to the defendant for compensatory 
allowances for the management of areas facing agricultural constraints in respect 
of claim year 2019, including for the 27 hectares of land in Bavaria. By decision 
of 5 December 2019 – served on 10 February 2020 – the application submitted by 
the applicant in respect of the land in Bavaria was rejected on the ground that the 
land was not in Baden-Württemberg. The administrative appeal lodged by the 
applicant was unsuccessful. 
4 The applicant brought an action on 17 June 2021. In the action, it claims that the 
decision of 5 December 2019 (in the form of the decision of 11 May 2021 on the 
administrative appeal) should be annulled and that the defendant should be 
ordered to grant it a compensatory allowance of EUR 1 371.26 for the land in 
Bavaria. In the alternative, in the event that that principal claim is unsuccessful, it 
is seeking a declaration that the rejection of its application for support for land in 
Bavaria and the underlying legal bases of the decision, namely Paragraphs 2.1 and 
3.2.1 of the Administrative regulation of the Ministry of Rural Affairs and 
Consumer Protection of Baden-Württemberg on support for farms in mountain 
areas and in certain areas facing constraints (VwV AZL) of 6 November 2019, 
infringe Articles 31 and 32 of Regulation No 1305/2013. 
5 The VwV AZL does not constitute a parliamentary act, but is merely an 
administrative regulation to guide the defendant’s discretion and support practice. 
In the field of transaction management, including the grant of public funding to 
citizens, according to German constitutional tradition there is often no need for a 
parliamentary act to determine who, when and under what conditions it is possible 
or permissible to receive funding. Administrative regulations have binding effect 
simply in that, in practice, the administration always applies them in the same way 
(the administration is bound by its own acts). 
6 The VwV AZL governs the conditions and the procedure for the grant of the 
compensatory allowance for areas facing natural constraints within the meaning of 
Article 31 of Regulation No 1305/2013 and essentially provides that two 
cumulative conditions must be met in order for an applicant to receive the 
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compensatory allowance: (a) it must have its place of business in Baden-
Württemberg and (b) the land in respect of which the compensatory allowance is 
granted must be in Baden-Württemberg and be identified by Baden-Württemberg 
as an area facing constraints. 
7 Bavaria similarly adopted a mere administrative regulation for the compensatory 
allowance, namely the Richtlinie des Bayerischen Staatsministeriums für 
Ernährung, Landwirtschaft und Forsten vom 01.03.2019 zur Gewährung der 
Ausgleichszulage in benachteiligten Gebieten (Guidelines of the Bavarian State 
Ministry of Food, Agriculture and Forestry of 1 March 2019 on the grant of the 
compensatory allowance in areas facing constraints, AGZ) pursuant to Regulation 
No 1305/2013. That administrative regulation provides analogously that (a) the 
farm to be supported must have its place of business in Bavaria and that (b) the 
land in respect of which the compensatory allowance is granted must be in 
Bavaria and be identified by Bavaria as an area facing constraints. 
8 For the term ‘place of business’ the VwV AZL adopts the definition from 
Paragraph 2 of the InVeKoSV. Under Paragraph 2(2) of the InVeKoSV, the place 
of business is, in principle, the place which lies within the area of the tax office 
responsible for assessing income tax in respect of the farmer. For legal persons, 
groups of persons and pools of securities, responsibility lies with the Land office 
in whose area the place of management is located. Pursuant to the rules, the 
business is assigned a company number in Germany depending on the place of tax 
assessment. A Baden-Württemberg business is thus given a Baden-Württemberg 
company number and a Bavarian business is assigned a Bavarian company 
number. A German business is therefore always linked to a place of business in 
one of the German Länder in the company file, which is used to process 
applications for support. Foreign businesses – from Austria for example – with 
land in Baden-Württemberg can also be assigned a Baden-Württemberg company 
number upon request. By contrast with German businesses, no fixed link is made 
to a company stored in the company file in this case because (apparently) this is 
not technically possible. The foreign – Austrian for example – business therefore 
appears with a Baden-Württemberg place of business in the company file. 
9 The Baden-Württemberg authority which has responsibility for the applicant 
routinely applies the VwV AZL as it stands and grants compensatory allowances 
on that basis. That authority’s support practice is consistent with the content of the 
administrative regulation. Citizens may therefore expect, pursuant to the principle 
of equal treatment (Article 3(1) of the Basic Law), that compensatory allowances 
be granted on the basis of the administrative regulation. 
10 A web-based application is used to process applications for support in Baden-
Württemberg. There is data reconciliation between the different applications of 
the German Länder, which prevents multiple applications for support being 
submitted in different Länder. An application for support can be made only in the 
Land in which the place of business is also located. No such data reconciliation 
takes place with other EU Member States. Because foreign businesses can be 
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assigned a company number in Baden-Württemberg, they are also able, in 
addition to an application for support in their country of origin, to submit 
applications for support in Baden-Württemberg and, as the case may be, in other 
German Länder. 
Succinct presentation of the reasoning in the request for a preliminary ruling 
11 The applicant is prevented by the defendant’s support practice, which is based on 
the VwV AZL, from receiving the compensatory allowance in respect of its land 
in Bavaria even though that land constitutes a mountain area and has been 
identified in Bavaria as an eligible area. At the same time, it is not possible for it, 
unlike foreign businesses, to submit a further application for support outside 
Baden-Württemberg. Consequently, it is unable to submit an application for 
support in Bavaria in respect of its Bavarian land. 
12 As a result, by virtue of the rules in Baden-Württemberg and in Bavaria the 
applicant does not receive a compensatory allowance for its Bavarian land, either 
from the Land of Baden-Württemberg or from the Land of Bavaria, even though 
Baden-Württemberg and Bavaria have each decided to offer and pay 
compensatory allowances and even though Bavaria has also identified the land in 
question owned by the applicant as a mountain area and thus as eligible. 
According to the competent Bavarian authority, the applicant would be paid a 
compensatory allowance of EUR 50 per hectare in respect of the Bavarian land if 
it were managed by a Bavarian business. 
13 Compared with a foreign (Austrian for example) business, German (border) 
businesses in Baden-Württemberg are placed in a less favourable position with 
regard to the compensatory allowance (reverse discrimination). Baden-
Württemberg border businesses do not receive a compensatory allowance for all 
areas facing natural constraints managed by them but only for land which, 
additionally, is in Baden-Württemberg. No compensatory allowance is granted for 
land beyond the border of the relevant Land. Because foreign businesses are able 
to submit an application for support in their country of origin as well as in Baden-
Württemberg, they are not subject to this restriction. 
14 The court has doubts as to the interpretation of the first subparagraph of 
Article 31(1), Article 31(2), Article 32(1)(a), the first subparagraph of 
Article 32(2) and the second and third subparagraphs of Article 32(3) of 
Regulation No 1305/2013. In the view of the referring court, it is not clear from 
those provisions how broad the EU law framework is within which the Member 
States may organise their support measures for compensatory allowances, above 
all in cases with a cross-border link between regions within one Member State. It 
is also doubtful whether, provided that the Member State or the region in question 
has decided to grant support through compensatory allowances, those provisions 
stipulate which support criteria the Member States or regions may prescribe and 
which they may not (see 1.). It is also unclear whether, if the Member State or the 
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region thereof grants support through compensatory allowances, the citizen 
concerned derives an entitlement under EU law to payment of the compensatory 
allowance from Article 31(1) of Regulation No 1305/2013 (see 2.) and whether it 
can be inferred from the rules of EU law what legal status the implementing acts 
of the Member State or the region laying down the conditions for support in 
respect of the compensatory allowance must have (see 3.). 
15 1. Article 32(2) to (4) of Regulation No 1305/2013 lays down various criteria for 
the Member States and the regions thereof on which the delimitation of eligible 
areas under that regulation is to be based. It is unclear to the referring court 
whether those criteria for the delimitation of areas are definitive and what 
stipulations for the Member States can be inferred from those rules in connection 
with cases of support crossing the borders of a Member State or the regions 
thereof. 
16 The wording of recital 26 and the first subparagraph of Article 32(2) of 
Regulation No 1305/2013 suggests that the Member States (or the regions thereof) 
may have recourse in the delimitation of areas only to criteria connected with the 
biophysical properties or the natural condition of the land to be supported. 
Recital 26 and the first subparagraph of Article 32(2) of Regulation No 1305/2013 
each describe in detail the reasons for which potentially eligible land is to be 
classified as facing natural constraints and as an (eligible) mountain area. On the 
other hand, it is not expressly mentioned whether in delimiting areas the Member 
States or the regions thereof may apply derogating criteria, that is to say, criteria 
unconnected with the natural condition of the land to be supported. In view of the 
legal character of Regulation No 1305/2013 (see the first and second sentences of 
paragraph 2 of Article 288 TFEU), it seems unreasonable to suggest that the 
Member States or the regions thereof may employ criteria for the delimitation of 
areas not set out in Article 32 of Regulation No 1305/2013. Latitude for the 
Member States or the regions thereof in the choice of form and methods would be 
more in keeping with character of an EU directive (see the third paragraph of 
Article 288 TFEU). 
17 The second subparagraph of Article 32(3) of Regulation No 1305/2013 enables a 
delimitation of areas which is confined to the area of the respective local 
administrative unit. It is questionable whether at the same time the procedure in 
respect of cross-border cases (between different Member States or different 
regions of one Member State) is prescribed for Member States. It is clear from the 
second subparagraph of Article 32(3) of Regulation No 1305/2013 that the 
legislature envisaged that delimitations of areas in Member States are to be carried 
out at the level of local administrative units (‘LAU 2’), that is to say, at the level 
of the administrative authority which has a local connection with the areas to be 
classified as eligible. If the local administrative units are to carry out the 
delimitation of areas in practice, this means, in the view of the referring court, that 
each local administrative unit carries out the delimitation of areas only within its 
own area of responsibility, as the local connection required by the 
abovementioned provision exists only for those areas. The principle of 
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effectiveness of EU law (‘effet utile’) enshrined in Article 4(3) TEU suggests, 
however, that the Member States may not organise their criteria and procedures 
for the grant of the compensatory payment in such a way that it is ultimately not 
paid for certain land even though the land has been classified as eligible, 
irrespective of the Member State or the region or local administrative unit which 
made that classification. 
18 2. It is also unclear to the referring court whether farmers derive an entitlement 
under EU law to payment of the compensatory allowance from the first and 
second subparagraphs of Article 31(1) of Regulation No 1305/2013 vis-à-vis the 
authority of a Member State which approves applications for support and – if so – 
under what conditions. The wording of the first and second subparagraphs of 
Article 31(1) of Regulation No 1305/2013, and in particular the words ‘wird 
Landwirten gewährt, die’ in Article 31(2), certainly points to that conclusion. 
According to general language usage, the wording implies that it is mandatory to 
pay the compensatory allowance if the conditions set out in the following clause 
(starting with ‘… die’) are met. Mandatory character is also present in this form in 
other language versions of the regulation, such as the English version of 
Article 31(2) of Regulation No 1305/2013 (‘shall be granted to farmers who’). 
19 However, that understanding of the provision runs counter to the system 
established by Regulation No 1305/2013. It is designed as a multi-tiered system 
and entails programming by the Member States or the regions thereof (see the 
third sentence of Article 6(1) and the first sentence of Article 6(2) of Regulation 
No 1305/2013). Only where there is such programming by the Member State in 
question are support programmes funded by the EAFRD. By virtue of that design, 
the Member States may in principle – subject to a number of exceptions – decide 
whether they wish to offer individual support programmes mentioned in 
Regulation No 1305/2013. The support measure ‘compensatory allowance’ is not 
mentioned in the regulation as a measure which Member States must mandatorily 
include in their programming, unlike, for example, the agri-environment-climate 
measures under the third sentence of Article 28(2) of Regulation No 1305/2013. 
20 3. It is likewise doubtful to the referring court whether it is possible to infer from 
Article 31(1) of Regulation No 1305/2013 stipulations for the Member States as to 
the necessary legal status the Member State’s rules laying down the conditions for 
the grant of the compensatory allowance. It is not specified in detail in Regulation 
No 1305/2013 how Member States should organise support under their national 
law. It is therefore apparent that the Member States have a broad scope for 
implementation in this regard, but their implementation in national law may not 
deprive the individual measures (Articles 14 to 39 of Regulation No 1305/2013) 
of their effectiveness (‘effet utile’). Organising the support criteria in the form of 
administrative regulations (non-binding legal provisions) therefore appears 
problematic. Their legal status means that the authority processing applications is 
bound only by the support practice based on the administrative regulations 
(principle that the administration is bound by its own acts). If that authority does 
not establish such support practice, and generally derogates from the 
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administrative regulation, only the derogating support practice acquires external 
effect vis-à-vis the respective farmer. The authorities processing applications can 
thus, in theory, subsequently modify the conditions for support which were 
previously laid down in an administrative regulation. 
21 Relevance to the decision: The answer to Question 3 affects the way in which the 
referring court will be required to decide on the applicant’s principal claim 
(obligation to grant a compensatory allowance of EUR 1 371.26). As national law 
stands at present, the applicant is not entitled to the grant of the compensatory 
allowance in respect of its land in Bavaria. On the basis of the defendant’s support 
practice, which is consistent with Paragraphs 2.1 and 3.2.1 of the VwV AZL, the 
compensatory allowance is granted only for land in Baden-Württemberg. There is 
no basis under national law for an entitlement in respect of land in Bavaria. If 
Question 3 is answered in the negative by the Court of Justice, the principal claim 
must be rejected. 
22 The answers to Questions 1, 2 and 4 affect the referring court’s decision on the 
claim made by the applicant in the alternative (declaration of the unlawfulness of 
the rejection of its application for support). If Question 3 is answered in the 
negative, the referring court is required to decide on the claim in the alternative. 
Questions 1, 2 and 4 include different options which under national law each in 
themselves – if the Court of Justice were to answer one of these questions in the 
affirmative – result in the defendant’s current support practice based on the VwV 
AZL and the organisation of the support criteria therein being unlawful, as a 
consequence of which the rejection of the application for support submitted by the 
applicant is also unlawful. By the application, the applicant is able to secure an 
order that it should be granted and paid retrospectively a compensatory allowance 
for the land in Bavaria in respect of claim year 2019, even if to do so the 
defendant would first have to modify the support criteria. As they stand at present, 
the support criteria do not permit a compensatory allowance for land in Bavaria. 
23 Thus far, there is no case-law of the Court of Justice regarding Articles 31 and 32 
of Regulation No 1305/2013 and the compensatory allowances governed therein 
for areas facing natural constraints. 
24 There are not yet any published decisions from courts in Baden-Württemberg on 
compensatory allowances under Article 31 of Regulation No 1305/2013 and the 
VwV AZL, which was adopted on that basis. As regards the legal situation in 
Bavaria – which corresponds mutatis mutandis to that in Baden-Württemberg – 
there is a final, published judicial decision of the Bayerischer 
Verwaltungsgerichtshof (Bavarian Higher Administrative Court). In that case, the 
applicant was a farmer on the border between Bavaria and Hesse (another Land, 
that is to say, a region of Germany). The farm covered land in both Bavaria and 
Hesse and the applicant was also seeking a compensatory payment for the land in 
Hesse, which it was not granted on the ground that the land was not in Bavaria.