62022CC0169
OPINION OF ADVOCATE GENERAL
RANTOS
delivered on 9 March 2023 (
1
)
Case C‑169/22
Fractal Insolvenţă SPRL, acting as administrator in the insolvency of Groenland Poultry SRL
v
Agenţia de Plăţi şi Intervenţie pentru Agricultură – Centrul Judeţean Dâmboviţa
(Request for a preliminary ruling from the Curtea de Apel Bucureşti (Court of Appeal, Bucharest, Romania))
(Reference for a preliminary ruling – Common agricultural policy – European Agricultural Fund for Rural Development (EAFRD) – Support measures for rural development – Animal welfare payments – Regulation (EC) No 1974/2006 – Article 44(2)(a) – Article 47(1) – Transfer of the agricultural holding to a new beneficiary – Subsequent cessation, by the new beneficiary, of agricultural activities – Case of force majeure or exceptional circumstances – Obligation to reimburse all or part of the aid received – Principle of proportionality)
I. Introduction
1.
This request for a preliminary ruling concerns the interpretation of Article 44(1) and (2)(a) and of Article 47(1) of Regulation (EC) No 1974/2006 (
2
) laying down detailed rules for the application of Council Regulation (EC) No 1698/2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD).
2.
The request has been made in proceedings between Fractal Insolvenţă SPRL, acting as administrator in the insolvency of Groenland Poultry SRL (‘Groenland Poultry’), and the Agenţia de Plăţi şi Intervenţie pentru Agricultură – Centrul Judeţean Dâmboviţa (Agency for Payments and Interventions in Agriculture – Dâmbovița Provincial Centre, Romania; ‘the APIA’) concerning decisions of the APIA requiring Groenland Poultry, on account of the cessation of its agricultural activities, to reimburse all animal welfare payments granted during the five-year animal welfare commitment.
3.
In accordance with the Court’s request, this Opinion will focus on the examination of the second and third questions referred for a preliminary ruling. They concern, in essence, whether and to what extent Article 44(1) and (2)(a) of Regulation No 1974/2006 must be interpreted as meaning that the transferee of an agricultural holding, which also took over a multiannual animal welfare commitment with regard to support for animal welfare financed by the EAFRD, is required to reimburse, if it definitively ceases activities before the end of the period for which the commitment was given, all amounts received during that period, including those received by the previous beneficiaries of the aid.
4.
Whilst the Court has already had the opportunity to interpret certain provisions of Regulation (EC) No 1698/2005, (
3
) it is the first time that it will have to rule on the interpretation of Article 44 of Regulation No 1974/2006. (
4
)
II. Legal framework
A.
European Union law
1. Regulation No 1698/2005
5.
Regulation No 1698/2005 (
5
) was repealed by Regulation (EU) No 1305/2013 of the European Parliament and of the Council of 17 December 2013. (
6
)
6.
Article 36(a)(v) of Regulation No 1698/2005 provided that support under the section ‘Improving the environment and the countryside’ is to concern measures targeting the sustainable use of agricultural land through animal welfare payments.
7.
Article 40 of that regulation provided:
‘1.   Animal welfare payments provided for in Article 36(a)(v) shall be granted to farmers who make on a voluntary basis animal welfare commitments.
2.   Animal welfare payments cover only those commitments going beyond the relevant mandatory standards … and other relevant mandatory requirements established by national legislation and identified in the programme.
These commitments shall be undertaken as a general rule for a period between five and seven years. …
3.   The payments shall be granted annually and shall cover additional costs and income foregone resulting from the commitment made. Where necessary, they may cover also transaction cost.
Support shall be limited to the maximum amount laid down in [Annex I].’
8.
Under Article 74(1) of that regulation:
‘Member States shall adopt all the legislative, statutory and administrative provisions … in order to ensure that the [European Union’s] financial interests are effectively protected.’
2. Regulation No 1974/2006
9.
Regulation No 1974/2006 was repealed by Commission Delegated Regulation (EU) No 807/2014 of 11 March 2014 supplementing Regulation (EU) No 1305/2013 of the European Parliament and of the Council on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and introducing transitional provisions. (
7
) However, Regulation No 1974/2006 continued to apply to operations implemented pursuant to programmes approved by the European Commission under Regulation No 1698/2005 before 1 January 2014.
10.
Under Article 1 of Regulation No 1974/2006:
‘This Regulation lays down detailed rules for the application of [Regulation No 1698/2005] as regards principles and general rules for rural development support, specific and common provisions for rural development measures, and eligibility and administrative provisions, except provisions on controls.’
11.
Article 44 of that regulation provided:
‘1.   Where all or part of a holding of the beneficiary is transferred to another person during the period for which a commitment given as a condition for the grant of assistance runs, that other person may take over the commitment for the remainder of the period. If the commitment is not taken over, the beneficiary shall reimburse the assistance granted.
2.   Member States may choose not to require the reimbursement referred to in paragraph 1 in the following cases:
(a)
where a beneficiary who has already honoured a significant part of the commitment concerned definitively ceases agricultural activities and it is not feasible for a successor to take over the commitment;
(b)
where the transfer of a part of the holding of a beneficiary occurs during a period of extension of the commitment in accordance with the second subparagraph of Article 27(12) and the transfer does not concern more than 50% of the area covered by the commitment before the extension;
(c)
where the holding of a beneficiary is entirely or partly transferred to an organisation having the main objective of nature management in view of conservation of the environment, provided that the transfer aims at a permanent change of land use into nature conservation and that this is associated with a significant benefit to the environment.
3.   In the event of minor changes to the situation of a holding, Member States may take specific measures to ensure that the application of paragraph 1 does not lead to inappropriate results as regards the commitment entered into.
A reduction in the area of the holding of up to 10% of the area under commitment shall be considered as a minor change for the purpose of the first subparagraph.’
12.
Article 45(4) of that regulation stated:
‘Where a beneficiary is unable to continue to comply with commitments given because the holding is reparcelled or is the subject of public land-consolidation measures or of land-consolidation measures approved by the competent public authorities, Member States shall take the measures necessary to allow the commitments to be adapted to the new situation of the holding. If such adaptation proves impossible, the commitment shall expire and reimbursement shall not be required in respect of the period in which the commitment was effective.’
13.
Article 47 of that regulation provided:
‘1.   Member States may recognise, in particular, the following categories of force majeure or exceptional circumstances in which they will not require the partial or full reimbursement of aid received by the beneficiary:
(a)
death of the beneficiary;
(b)
long-term professional incapacity of the beneficiary;
(c)
expropriation of a large part of the holding if that could not have been anticipated on the day on which the commitment was given;
(d)
a severe natural disaster seriously affecting land on the holding;
(e)
the accidental destruction of livestock buildings on the holding;
(f)
an epizootic disease affecting all or part of the farmer’s livestock.
2.   Cases of force majeure or exceptional circumstances shall be notified in writing by the beneficiary, or any person entitled through or under him to the competent authority, together with relevant evidence to the satisfaction of that authority, within 10 working days from the date on which the beneficiary, or the person entitled through or under him, is in a position to do so.’
B.
Romanian law
14.
Article 17 of ordonanță de urgență a Guvernului nr. 66/2011 privind prevenirea, constatarea și sancționarea neregulilor apărute în obținerea și utilizarea fondurilor europene și/sau a fondurilor publice naționale aferente acestora (
8
) (Government Emergency Order No 66/2011 regarding prevention, ascertainment and penalisation of irregularities associated with the collection and use of European funds and/or national public funds relating thereto) provides:
‘Any action taken with a view to ascertaining an irregularity and determining the budgetary claims resulting from such an irregularity shall be undertaken in accordance with the principle of proportionality, taking into account the nature and gravity of the irregularity ascertained as well as its scale and financial implications.’
15.
Article 30(1) of ordonanța de urgență a Guvernului nr. 3/2015 pentru aprobarea schemelor de plăți care se aplică în agricultură în perioada 2015-2020 și pentru modificarea art. 2 din Legea nr. 36/1991 privind societățile agricole și alte forme de asociere în agricultură (
9
) (Government Emergency Order No 3/2015 approving the payment schemes applicable to agriculture in the period 2015 to 2020 and amending Article 2 of Law No 36/1991 on agricultural companies and other forms of associations in agriculture), provides:
‘For the purposes of the financing, management and monitoring of the common agricultural policy, the following cases in particular may be recognised as cases of force majeure or exceptional circumstances:
…
(f)
expropriation of all or a large part of the holding if that could not have been anticipated on the day on which the application was lodged.’
16.
Under Article 31 of that order:
‘(1)   Cases of force majeure and exceptional circumstances shall be notified in writing to the APIA, together with evidence that the situations referred to in Article 30(1) have occurred, within 15 working days from the day on which the beneficiary or its successor in title is in a position to do so.
(2)   If the beneficiary or its successor in title exceeds the time limit set out in paragraph 1, the notification shall not be taken into account.’
III. The dispute in the main proceedings, the questions referred for a preliminary ruling and the procedure before the Court
17.
By an aid application submitted to the APIA on 18 January 2013, Avicola Crevedia SA, operator of a poultry slaughterhouse, voluntarily took on a five-year animal welfare commitment pursuant to Article 40 of Regulation No 1698/2005.
18.
During the five-year period of that commitment, the holding in its entirety was transferred, first, to Abator Avicola Crevedia SRL, which took over the animal welfare commitment on 15 November 2013, and, then, to Groenland Poultry, which also took over the animal welfare commitment and registered it with the APIA on 2 April 2015.
19.
To that end, Groenland Poultry concluded, on 30 March 2015, two agreements:
–
an agreement for the transfer of the agricultural holding and to take over the animal welfare commitment with Abator Avicola Crevedia, which waived the right to receive the animal welfare payment requested from the APIA on 13 November 2014, whereas Groenland Poultry, to which the right to request payment of the aid was transferred, took on the obligation to comply with the commitments given by the transferor in the aid application and to fulfil the eligibility conditions; and
–
an agreement to lease various premises and production facilities of that holding with Agroli Group SRL (‘Agroli Group’), which was the owner of the leased assets but not the holder or operator thereof and in respect of which insolvency proceedings were initiated on 6 March 2014; that agreement was subject to a suspensory condition laid down in favour of the lessor relating to the approval of the lease by the creditors’ committee in connection with the insolvency proceedings.
20.
By a payment notice of 4 December 2015, the APIA paid Groenland Poultry, pursuant to the payment application submitted by Abator Avicola Crevedia on 13 November 2014, the amount of 1 506 915.86 Romanian lei (RON) (EUR 337100). (
10
) Following payment applications lodged and amended on 13 November 2015 and 15 June 2016 by Groenland Poultry, the APIA also paid it, by payment notice of 5 October 2016, the amount of RON 850 673.62 (EUR 190635), (
11
) in addition to the amount of RON 375 941.35 (EUR 82520), (
12
) by advance payment notice of 29 March 2017.
21.
In so far as Groenland Poultry did not submit a payment application for the fifth year of the period for which the commitment was given (namely 2017), the APIA notified it of the non-submission of a payment application. On 18 April 2017, Fractal Insolvenţă, as court-appointed liquidator of Groenland Poultry, gave notification that bankruptcy proceedings had been initiated against that company.
22.
On 21 April 2017, the APIA issued four reports (Nos 3067 to 3070) establishing irregularities and determining credit entries under Article 8 of Implementing Regulation (EU) No 809/2014, (
13
) by which it ordered the recovery from Groenland Poultry of the amounts of RON 6 940 168.72 (EUR 1527531), RON 4 562 717.78 (EUR 1004254), RON 1 506 915.86 (EUR 331672) and RON 850 673.62 (EUR 187233), (
14
) in respect of the first to fourth years of the period for which the commitment was given, respectively, on the ground that that company, being subject to winding up proceedings, had ceased agricultural activities and was no longer able to honour the five-year commitment. (
15
) The total amount to be borne by Groenland Poultry was RON 14 236 417.32 (EUR 3133435), including the amount of RON 11 502 886.50 (EUR 2531785) which had not been paid to Groenland Poultry but to the previous operators, Groenland Poultry having received only RON 2 733 530.83 (EUR 601650) of the amount charged (namely the amounts set out in point 20 of this Opinion). (
16
)
23.
In so far as the APIA rejected, by decisions Nos 214 to 217 of 19 June 2017, Groenland Poultry’s complaints directed against those reports, Groenland Poultry brought before the Tribunalul Bucureşti (Regional Court, Bucharest, Romania) an action for annulment of those decisions, claiming, inter alia, the following:
–
the absence of any obligation to reimburse the amounts received on the ground that Groenland Poultry was not able to honour the commitment in 2017 on account of an ‘expropriation’, within the meaning of Article 47(1)(c) of Regulation No 1974/2006, or a similar situation, namely the notification by the lessor on 26 July 2016 of the failure to fulfil the suspensory condition of the lease accompanied by a request to vacate the premises within 15 days, (
17
) as a result of the bankruptcy proceedings initiated against Agroli Group on 9 May 2016. The APIA was notified of that factual situation in accordance with the notification obligation laid down in Article 47(2) of that regulation;
–
the application of Article 44(2)(a) of that regulation, which provides that Member States may choose not to require the reimbursement where a beneficiary which has already honoured a significant part of the commitment concerned definitively ceases agricultural activities and it is not feasible for a successor to take over the commitment, in so far as the committee of Agroli Group’s creditors had approved the conclusion of a new lease with Vitali SRL (‘Vitali’), but that Vitali, with which Groenland Poultry had intended to conclude an agreement for Vitali to carry on the activities in question, had not obtained the necessary sanitary authorisations from the Veterinary and Food Safety Authority in Dâmbovița (Romania); and
–
infringement of the principle of proportionality, having regard to the way in which the administrative authorities applied Article 44(2)(a), of Regulation No 1974/2006, in so far as the APIA had imposed on Groenland Poultry an obligation to reimburse the amount of RON 14 236 417.32 (EUR 3133435) in respect of the first to fourth years of the commitment, although Groenland Poultry had honoured the commitment in respect of four of the five years thereof, and the amount charged also included the sum of RON 11 155 878.064 (EUR 2455409) in respect of the first and second years of the commitment which had not been paid to Groenland Poultry but to the previous operators, Groenland Poultry having received only RON 2357589 (EUR 518905) (
18
) of the amount charged in respect of the third and fourth years of the commitment, and in view also of the fact that the failure to honour the commitment cannot be attributed to it, in so far as the failure to renew the lease with Agroli Group was beyond Groenland Poultry’s control and, moreover, the failure to conclude a holding transfer agreement with Vitali cannot be attributed to it, since Vitali did not obtain the veterinary health authorisations necessary for the premises in which the agricultural activities were carried out.
24.
By judgment of 26 October 2018, the Tribunalul Bucureşti dismissed the action as unfounded, in particular finding that:
–
the commitments had not been complied with for a minimum period of five years and that, under Article 44 of Regulation No 1974/2006, and Article 8 of Implementing Regulation No 809/2014, once the holding had been transferred to Groenland Poultry, the latter had acquired the rights and assumed the obligations of the transferor and, implicitly, the consequences of any failure to comply with the conditions of admissibility;
–
Article 47(1)(c) of Regulation No 1974/2006 was not applicable because the situation relied on by Groenland Poultry (i) did not constitute an expropriation corresponding, under national law, to the acquisition of assets by the State justified by general interests, (ii) cannot be equated to an expropriation and (iii) was not unforeseeable on the day on which the commitment was entered into, that is to say the day on which Groenland Poultry concluded the lease with Agroli Group, at which time Groenland Poultry was aware that insolvency proceedings had been initiated against Agroli on 6 March 2014, and that the lease was subject to the suspensory condition relating to approval by the creditors’ committee of the lease and to approval of the lessor’s reorganisation plan providing for the leasing of movable and immovable property, Groenland Poultry having taken a risk in that regard. Furthermore, the situation concerning Vitali occurred, according to that court, after the day on which the commitment had been entered into and could not therefore be taken into consideration. Lastly, the circumstances were not notified within the time limit laid down in Article 47(2) of Regulation No 1974/2006, namely within 10 working days from the date on which it was in a position to do so, that is to say on 26 July 2016, the date on which Groenland Poultry was informed of the termination of the lease;
–
the principle of proportionality and Article 44(2)(a) of Regulation No 1974/2006 were complied with because, under Article 8 of Implementing Regulation No 809/2014, the effects of non-compliance with the commitment by the transferee affects it throughout the period for which the commitment is given, including the period during which the holding was operated by the transferor, so that recovery from Groenland Poultry of amounts for the period prior to the date on which the commitment was entered into cannot be ruled out. In addition, that same court noted that the circumstance making it impossible to take over the commitment was not established, and that the APIA had acted within the framework of the margin of discretion conferred on Member States under Article 44(2)(a) of Regulation No 1974/2006.
25.
Hearing the appeal brought against that judgment by Groenland Poultry, the referring court, the Curtea de Apel Bucureşti (Court of Appeal, Bucharest, Romania), adjudicating at last instance, notes that it is faced with three issues of interpretation.
26.
First, the question arises as to whether the concept of ‘force majeure or exceptional circumstances’ contained in Article 47(1) of Regulation No 1974/2006 includes a situation where the beneficiary of the aid loses the right to use the leased assets following the termination of the lease on account of the insolvency of the owner of the leased assets, whilst observing that, in the present case, the APIA did not consider that this was an obstacle to the transfer of the holding or to the aid payment to Groenland Poultry. In that regard, according to the referring court, the difficulty of interpretation is based on the fact that, whilst it is apparent from a literal interpretation of that provision that the list of cases of ‘force majeure or exceptional circumstances’ in that provision is not exhaustive, (i) that concept is not defined in that regulation and (ii), failing any reference to national law, it cannot be defined by reference to national law, otherwise the unity of EU law would be compromised.
27.
Second, the referring court raises the question as to the interpretation of Article 44(1) and (2)(a) of Regulation No 1974/2006, in the light of the principle of proportionality, in a specific context such as that of the present case, where the APIA has imposed on Groenland Poultry the obligation to reimburse the total amount of RON 14 236 417.32 (EUR 3133435), although, it actually received only RON 2 733 530.83 (
19
) (EUR 601650) and the difference was paid to the previous beneficiaries in respect of the first two years of the commitment, and, moreover, the five-year commitment was honoured for four of the five years thereof and the cessation of Groenland Poultry’s activity in the last year was due to reasons beyond its control.
28.
Third, the referring court states that the condition that ‘it is not feasible for a successor to take over the commitment’ referred to in Article 44(2)(a) of Regulation No 1974/2006 appears to require the submission of evidence to that effect by the beneficiary which claims actually to be in such a situation, and not abstract evidence, which may be impossible to produce, of the absence of any successor interested in taking over the commitment. In that regard, the referring court states that Groenland Poultry produced evidence demonstrating that Vitali was interested in taking over the commitment but that the latter did not obtain the necessary sanitary and veterinary authorisations for that purpose, despite the agreement of the committee of Agroli Group’s creditors to lease the premises.
29.
In those circumstances, the Curtea de Apel Bucureşti (Court of Appeal, Bucharest) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1)
Must Article 47(1) of [Regulation No 1974/2006] be interpreted as meaning that cases of “force majeure or exceptional circumstances” also include the case where the beneficiary of the aid loses the right to use the leased assets following the termination of the lease on account of the insolvency of the owner of the leased assets (lessor)?
(2)
In the light of the principle of proportionality, must Article 44(2)(a) of [Regulation No 1974/2006] be interpreted as meaning that, where, during the period for which a commitment given as a condition for the grant of assistance runs, all or part of the holding of a beneficiary is transferred to another person, and that second beneficiary, although having honoured a significant part of the commitment concerned, [definitively] ceases agricultural activities, and it is not feasible for a successor to take over the commitment, the second beneficiary of the [aid] must reimburse the aid which it has received (in relation to the period for which it was the beneficiary of the aid), or must it also reimburse the aid received by the first beneficiary thereof?
(3)
What conditions must the national court take into consideration in interpreting Article 44(2)(a) of [Regulation No 1974/2006] for the purpose of assessing whether “it is not feasible for a successor to take over the commitment”?’
30.
Written observations were submitted by Groenland Poultry, the APIA, the Romanian and Greek Governments, and the Commission.
IV. Analysis
A.
Preliminary observations
31.
At the outset, it must be noted that Regulation No 1698/2005 was the basic regulation laying down general rules on EU support for rural development by the EAFRD for the 2007-2013 programming period, namely the period covered by the facts in the main proceedings. (
20
) That regulation was supplemented by the detailed rules laid down in Regulation No 1974/2006, Article 44(2) of which is the subject of the second and third questions referred and the analysis set out in this Opinion.
32.
Regulation No 1698/2005 provided, under Article 36(a)(v), among the support measures for improving the environment and the countryside, (
21
) measures promoting the sustainable use of agricultural land through, inter alia, animal welfare payments. In accordance with the provisions of Article 40 of Regulation No 1698/2005, those payments were granted to farmers who made on a voluntary basis animal welfare commitments (paragraph 1). Those commitments were undertaken as a general rule for a period between five and seven years (paragraph 2), the payments were granted annually and covered additional costs and income foregone resulting from the commitment made and, where necessary, transaction cost (paragraph 3).
33.
In the present case, Groenland Poultry is the third beneficiary of the aid granted during 2013, subject to a five-year animal welfare commitment, pursuant to Article 40 of Regulation No 1698/2005 and which resulted in annual payments. Groenland Poultry took over the holding and the animal welfare commitment during 2015 as the lessee of the premises but had to cease agricultural activities during 2016 because it could no longer use the leased assets on account of the termination of the lease by the lessor. In that context, the referring court, hearing an appeal brought against the judgment upholding the decisions of the APIA imposing on Groenland Poultry an obligation to reimburse in full the aid granted in the amount of approximately EUR 3133400, asks, in particular, whether those decisions comply with the principle of proportionality, noting that Groenland Poultry received only approximately EUR 585000 and that the commitment was honoured for four of the five years thereof.
B.
The second question referred
34.
By its second question, the referring court asks, in essence, whether, in the light of the principle of proportionality, Article 44(1) and (2)(a) of Regulation No 1974/2006 requires that the last beneficiary of the aid granted for the improvement of the environment and the countryside in favour of animal welfare which has been compelled to cease definitively its agricultural activities before the end of the multi-year period for which the commitment was given, where it has already honoured a significant part of that commitment and it is not feasible for a successor to take over that commitment, must reimburse that aid in full, including the aid paid to its predecessors, or in part, up to the amount of the aid actually received.
1. Admissibility
35.
The APIA and the Romanian Government consider that the second question, like the third, must be declared inadmissible on the ground that it relates to the interpretation of Article 44(2) of Regulation No 1974/2006 although this is of no assistance in resolving the dispute in the main proceedings. More specifically, those parties argue that, in so far as that provision provides that Member States ‘may choose’ (
22
) not to require the reimbursement referred to in paragraph 1 of that article and the fact that the Romanian legislature has chosen not to provide for that possibility under national law, the application of that provision is not likely to have an effect on the outcome of the dispute in the main proceedings, the beneficiary of the aid thus being required to repay the aid under Article 44(1) of that regulation.
36.
In that regard, I would point out that, in the procedure laid down by Article 267 TFEU providing for cooperation between national courts and the Court of Justice, first, it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court. Consequently, where the questions submitted by the national court concern the interpretation of a rule of EU law, the Court of Justice is, in principle, bound to give a ruling. Furthermore, the Court may refuse to rule on a question referred for a preliminary ruling by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it. (
23
) Second, in the same procedure providing for cooperation, it is for the Court to provide the national court with an answer which will be of use to it and enable it to decide the case before it. To that end, the Court should, where necessary, reformulate the questions referred to it. The Court may also find it necessary to consider provisions of EU law which the national court has not referred to in its questions. (
24
)
37.
In the present case, whilst the second question, as worded, expressly refers only to Article 44(2) of Regulation No 1974/2006, an optional provision for Member States which has not been included under Romanian law, I note, first, that the referring court, in its question, also referred to the principle of proportionality, which is one of the general principles of EU law; (
25
) second, that it is apparent, by implication, from the grounds of its request for a preliminary ruling that the referring court is also asking about the relationship of Article 44(2) with paragraph 1 thereof; and, third, that the Tribunalul Bucureşti (Regional Court, Bucharest) excluded the application of Article 44(2) not on account of the lack of ‘transposing measures’, but rather due to the fact that the substantive conditions were not met. (
26
)
38.
In the light of the foregoing considerations, and having regard to the case-law cited in point 36 above, I propose that the second question be found to be admissible, whilst reformulating it as referring, in essence, to the combined interpretation of Article 44(1) and (2)(a) of Regulation No 1974/2006.
2. Substance
39.
According to the referring court, the interpretation of those provisions in the light of the principle of proportionality is necessary having regard to two circumstances:
–
first, the fact that the APIA imposed on Groenland Poultry an obligation to reimburse the total amount of the aid received, including the aid in respect of the first and second years of the commitment, which had not been paid to Groenland Poultry but to the previous operators (namely Avicola Crevedia and Abator Avicola Crevedia), Groenland Poultry having actually received amounts only in respect of the third and fourth years of the commitment and such amounts corresponding to less than 20% of the total aid to be reimbursed; (
27
) and,
–
second, the fact that the commitment was honoured for four of the five years thereof, and the fact that the cessation of activities, that is to say the failure to carry on activities in the fifth year of the commitment was – most likely – due to reasons beyond the control of Groenland Poultry, namely the termination of the lease of the premises which was not attributable to it.
40.
The question therefore arises as to whether, in accordance with the principle of proportionality, Article 44 of Regulation No 1974/2006 must be interpreted in such a way that the APIA should have requested, as Groenland Poultry argues, only partial recovery of the amounts received under the commitment and, in particular, only the amounts received by Groenland Poultry.
41.
In that regard, in the first place, with respect to the wording of Article 44(1) of Regulation No 1974/2006, it should be borne in mind that, according to that provision, ‘where … a holding of the beneficiary is transferred to another person during the period for which a commitment given as a condition for the grant of assistance runs, that other person may take over the commitment for the remainder of the period. If the commitment is not taken over, the beneficiary shall reimburse the assistance granted’. (
28
)
42.
That provision thus lays down the general rule that the person who takes over the holding of the beneficiary of the aid, and who also takes over the commitment given by the beneficiary, replaces the latter with regard to all the commitments and obligations in respect of the remaining period. Accordingly, and contrary to what Groenland Poultry argues, I take the view that that provision regulates, in a clear and precise manner, the legal effects of the reimbursement obligation which arises from the transfer of the holding, by laying down the principle according to which the transferee of such a transfer which also voluntarily takes over the multiannual commitment is required, in its capacity as ‘beneficiary’, (
29
) to reimburse the aid received in the event of a new transfer of the holding to another person during the period for which the commitment was given, unless the latter in turn takes over the commitment for the remaining period.
43.
As the Commission points out, in line with the logic of Article 44(1) of Regulation No 1974/2006, in cases involving transfer of a holding, the transferor may also transfer its multiannual commitments. Accordingly, if the transferor chooses not to do so or if it is ‘not feasible’ to find a transferee (within the meaning of Article 44(2)(a) of that regulation (
30
)), the transferor is required to reimburse the aid granted in full, thus being released from its obligations. Likewise, the transferor is exempt from those obligations if the transferee in turn takes over the multiannual commitments, in which case the transferee becomes the beneficiary of the aid until the end of the period for which the commitments were given, including all advantages and responsibilities resulting therefrom. (
31
)
44.
In the second place, with regard to the context of Article 44(1) of Regulation No 1974/2006, it should be noted that, although that provision lays down the principle that, in the context of a holding transfer, it is the person honouring the commitment who is considered to be the beneficiary and is therefore required to reimburse the aid received, paragraphs 2 and 3 of that article set out exceptions to that principle, by allowing Member States to choose not to require reimbursement. More specifically, paragraph 2(a), which is the relevant scenario in the present case, creates an exception to the obligation for reimbursement where the ‘beneficiary who has already honoured a significant part of the commitment concerned definitively ceases agricultural activities and it is not feasible for a successor to take over the commitment’. As an exception to the general reimbursement obligation on the part of the beneficiary of the aid laid down in paragraph 1, the situations set out in paragraphs 2 and 3 must be interpreted narrowly. (
32
)
45.
However, in the circumstances of this case, it is common ground that the option provided for in Article 44(2) of Regulation No 1974/2006 has not been included in Romanian law, so that, in all cases involving the failure to take over the commitment when transferring the holding during the period for which the multiannual commitment was given, the beneficiary is still required, pursuant to Article 44(1) of that regulation, to reimburse in full the aid received and, by the same token, in the light of the principle of effectiveness, the Romanian authorities are required to recover the aid concerned, as there is no legal basis justifying non-recovery of aid. Therefore, in view of the facts of the dispute in the main proceedings, as set out in the order for reference, I consider that Groenland Poultry cannot rely on that exception in order to avoid the reimbursement of all of the aid received, including that paid to previous beneficiaries.
46.
In the third place, with regard to the purpose of Article 44(1) of Regulation No 1974/2006, it should be noted that the textual interpretation of that provision, set out above, also permits the initial objective for which the aid has been received to be attained, that is to say, to promote animal welfare. First of all, as the Commission states, for the purposes of that objective, it is essential that the multiannual commitment be honoured in its entirety, since only an extended period guarantees the achievement of the objective of that aid. (
33
) It is therefore important that, if the commitment is transferred to another beneficiary, all the debts and liabilities be attached to the beneficiary which takes over the commitment. The commitment must be honoured throughout the period, otherwise it diverges from the objective pursued and the beneficial effect in respect of the animals is lost.
47.
Next, account should also be taken, in that regard, of the fact that the commitment relates to animal husbandry and promotes animal welfare. The transferee which takes over the commitment, together with the assets and liabilities thereof, also takes on the full commitment in respect of previous years. Since the transferor has already invested the aid received for the welfare of the animals and for the benefit of the animals in its holding, thus improving the situation of the holding transferred to the transferee, the latter, as the beneficiary, indirectly benefits from the earlier investments and receives the remainder of the payment. If the second beneficiary is unable to honour the commitment throughout the period for which it was given, it must also bear all the negative aspects associated with such a commitment, by being required to reimburse the animal welfare payments received, including the payments received by the first beneficiary. That obligation to reimburse any aid received in the event of the termination of the commitment thus encourages the beneficiary to do everything possible to honour that commitment.
48.
Lastly, from the point of view of the effective protection of the European Union’s financial interests by the Member States, (
34
) it is important to ensure that EU funds can be recovered effectively if payment thereof has been made in breach of EU law. However, in a case such as the present one, it would be easy to circumvent the rule laid down in Article 44(1) of Regulation No 1974/2006 if the first beneficiary of the aid transferred its commitment to another beneficiary and if the latter immediately abandoned the multiannual commitment before its term, without financial consequences for either of them. With this in mind, the obligation to recover all of the aid received under the commitment is also dictated by the provisions of Regulation (EU) No 1306/2013, (
35
) Article 58(1)(e) of which requires Member States to take the measures necessary to ensure effective protection of the financial interests of the Union and, in particular, to recover undue payments.
49.
That conclusion cannot be called into question by any arguments based on the infringement of the principle of legal certainty or the principle of proportionality.
50.
First, so far as concerns the principle of legal certainty, I take the view that Article 44(1) of Regulation No 1974/2006 is entirely consistent with that principle, since it is clear therefrom that, on termination of the commitment, it is for the ‘beneficiary of the aid’, within the meaning of that regulation, to reimburse all of the aid received, irrespective of whether it is the transferor or the transferee of the commitment. In other words, when taking over the commitment, the transferee is aware that, once it acquires the status of ‘beneficiary’, it must reimburse all the amounts received if the commitment is no longer honoured. In such circumstances, the new beneficiary, being fully aware of the risk and financial stakes linked to taking over the commitment, and having ‘monetised’ the commitment during the negotiation of the transfer contract, can, therefore, either refuse the commitment, do everything in its power to honour the commitment or try to transfer the holding and the commitment to a new transferee, if it considers it is unable to honour the commitment.
51.
Second, as for the principle of proportionality, I consider that the obligation for the second beneficiary to reimburse all the animal welfare payments received is proportionate, in so far as, for the reasons set out above, Article 44(1) of Regulation No 1974/2006 and the logic underlying that article are sufficiently clear and unconditional thus allowing the transferee to know, at the time of the conclusion of the agreement, that if it chooses to take over the commitments, and if it does not honour the multiannual commitment after the transfer of the holding, it may be required to reimburse all the aid, including the aid received previously by the transferor. The proportional nature of the rule stems from the fact that, pursuant to Article 44(1), the transferor of the holding may choose not to take over the multiannual commitment (as is apparent from the wording of that provision ‘that other person may take over the commitment for the remainder of the period’ (emphasis added)). Furthermore, and in any event, Article 44 does not preclude the parties from agreeing, in the transfer agreement, on their respective liabilities in the event that the last beneficiary waives the animal welfare commitment, giving rise to an action by the transferee against the transferor, on the basis of national law, before the national courts. However, in order to guarantee the effectiveness of Article 44(1) of Regulation No 1974/2006, such contractual clauses can be used only in exercise of the right of subrogation, after all the aid received has been reimbursed. Lastly, in so far as the reimbursement obligation derives from relevant provisions of EU law, without leaving Member States any discretion, apart from Article 44(2) and (3), I consider that the principle of proportionality cannot be called into question.
52.
In the light of the foregoing, I propose that the answer to the second question referred for a preliminary ruling should be that Article 44(1) and (2)(a) of Regulation No 1974/2006 must be interpreted as meaning that in a situation in which, during the period for which a commitment given as a condition of the grant of assistance runs, the holding of a beneficiary is transferred, in whole or in part, to another person who voluntarily takes over that commitment and who subsequently definitively ceases agricultural activities, that second beneficiary must, in principle, irrespective of the fact that the latter has already honoured a significant part of that commitment, reimburse the aid received under that commitment as a whole, including the amounts received by previous beneficiaries of the aid, unless the Member State concerned has chosen not to require that reimbursement under the exceptions referred to, in particular, in Article 44(2)(a) of that regulation.
C.
The third question referred
53.
By its third question, the referring court asks, in essence, what the relevant factors are that must be taken into account for the purposes of assessing whether ‘it is not feasible for a successor to take over the commitment’, within the meaning of the third condition laid down in Article 44(2)(a) of Regulation No 1974/2006.
1. Admissibility
54.
For the reasons already set out in points 35 to 38 of this Opinion, I propose that the third question be declared admissible.
2. Substance
55.
As noted in points 41 to 43 of this Opinion, Article 44 of Regulation No 1974/2006 lays down, in paragraph 1 thereof, the general rule applicable to situations in which the beneficiary ceases its agricultural activities: ‘if the commitment is not taken over, the beneficiary shall reimburse the assistance granted’, and, in paragraph 2(a) thereof, one of the exceptions to that general rule applicable to specific situations in which a farmer ‘definitively ceases agricultural activities’ for reasons other than cases of force majeure or exceptional circumstances as referred to in Article 47 of that regulation (and will be analysed in the context of the first question referred for a preliminary ruling).
56.
That exception applies if two conditions are met: namely, first, the transferring beneficiary has already honoured a significant part of the commitment concerned and, second, it is not feasible for a successor to take over the commitment. The referring court is seeking guidance from the Court on the interpretation of the second condition, laid down in Article 44(2)(a) of that regulation.
57.
More specifically, the referring court notes that that provision appears to require the submission of evidence to that effect by the beneficiary which claims actually to be in such a situation, and not abstract evidence, which may be impossible to produce, of the absence of any successor interested in taking over the commitment. In that regard, the referring court states that Groenland Poultry produced evidence demonstrating that Vitali was interested in taking over the commitment but that the latter did not obtain the sanitary and veterinary authorisations necessary for taking over the agricultural activity, despite the agreement of the committee of Agroli Group’s creditors to lease the production facilities.
58.
In that regard, it should first of all be observed that the wording of Article 44(2)(a) of Regulation No 1974/2006 refers to ‘a successor to take over the commitment’, that is to say, ‘any successor’, and does not refer to a single specific successor (emphasis added). Thus, if the EU legislature had wished to emphasise the impossibility for the successor of the holding to take over the commitment, it would simply have stated that it is not feasible for the successor to take over the commitment. Therefore, in order to rely on that exception, I take the view that it is not sufficient that the taking over of the commitment by a successor may prove impossible on account of a difficulty specific to that successor in particular, but that objective circumstances prevented the beneficiary from ‘saving’ the commitment, that is to say that it was not objectively possible to transfer the commitment.
59.
It seems to me that that interpretation can also be corroborated by the contextual analysis set out in point 44 of this Opinion, according to which the rule set out in Article 44(2)(a) of Regulation No 1974/2006 constitutes an exception to the rule laid down in Article 44(1) of that regulation and must therefore be interpreted narrowly.
60.
Lastly, in the present case, I note that, whilst it is for the referring court to assess whether objective circumstances could have prevented the transfer of the commitment from Groenland Poultry to Vitali, on the basis of the information provided by that court, the taking over of the commitment appears to be ‘feasible’, given that the successor had the intention of taking over the commitment but that only the impossibility of obtaining the administrative authorisation, that is to say a particular situation specific to that sole successor, precluded it.
61.
In the light of the foregoing, I propose that the answer to the third question referred for a preliminary ruling should be that Article 44(2)(a) of Regulation No 1974/2006, where it states that ‘it is not feasible for a successor to take over the commitment’, must be interpreted as referring to a situation in which it is not feasible for a successor to take over the commitment on account of objective circumstances which preclude the commitment from being honoured and which are not linked to particular or specific circumstances unique to that potential successor.
V. Conclusion
62.
In the light of the foregoing, I propose that the Court answer the questions referred for a preliminary ruling by the Curtea de Apel Bucureşti (Court of Appeal, Bucharest, Romania) as follows:
(1)
Article 44(1) and (2)(a) of Commission Regulation No 1974/2006 of 15 December 2006 laying down detailed rules for the application of Council Regulation (EC) No 1698/2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD), as amended by Commission Implementing Regulation (EU) No 679/2011 of 14 July 2011,
must be interpreted as meaning that in a situation in which, during the period for which a commitment given as a condition of the grant of assistance runs, the holding of a beneficiary is transferred, in whole or in part, to another person who voluntarily takes over that commitment and who subsequently definitively ceases agricultural activities, that second beneficiary must, in principle, irrespective of the fact that the latter has already honoured a significant part of that commitment, reimburse the aid received under that commitment as a whole, including the amounts received by previous beneficiaries of the aid, unless the Member State concerned has chosen not to require that reimbursement under the exceptions referred to, in particular, in Article 44(2)(a) of that regulation.
(2)
Article 44(2)(a) of Regulation No 1974/2006, as amended by Implementing Regulation No 679/2011, where it states that ‘it is not feasible for a successor to take over the commitment’,
must be interpreted as referring to a situation in which it is not feasible for a successor to take over the commitment on account of objective circumstances which preclude the commitment from being honoured and which are not linked to particular or specific circumstances unique to that potential successor.
(
1
)	Original language: French.
(
2
)	Commission Regulation of 15 December 2006 (OJ 2006 L 368, p. 15), as amended by Commission Implementing Regulation (EU) No 679/2011 of 14 July 2011 (OJ 2011 L 185, p. 57) (‘Regulation No 1974/2006’).
(
3
)	Council Regulation of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (OJ 2005 L 277, p. 1). See judgments of 12 September 2013, Slancheva sila (C‑434/12, EU:C:2013:546), and of 7 July 2016, Občina Gorje (C‑111/15, EU:C:2016:532).
(
4
)	See, however, judgment of 16 February 2023, Zamestnik izpalnitelen direktor na Darzhaven fond Zemedelie (C‑343/21, EU:C:2023:111), and Opinion of Advocate General Medina in that case (EU:C:2022:696) on the interpretation of Article 45(3) of Regulation No 1974/2006.
(
5
)	As amended by Council Regulation (EC) No 74/2009 of 19 January 2009 (OJ 2009 L 30, p. 100) (‘Regulation No 1698/2005’).
(
6
)	Regulation on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) No 1698/2005 (OJ 2013 L 347, p. 487).
(
7
)	OJ 2014 L 227, p. 1.
(
8
)	Monitorul Oficial al României, Part I, No 461 of 30 June 2011, in the version applicable to the dispute in the main proceedings.
(
9
)	Monitorul Oficial al României, Part I, No 191 of 23 March 2015, in the version applicable to the dispute in the main proceedings.
(
10
)	Based on the European Central Bank’s reference exchange rate as of 4 December 2015 (RON 1 – EUR 0.2237).
(
11
)	Based on the European Central Bank’s reference exchange rate as of 5 October 2016 (RON 1 – EUR 0.2241).
(
12
)	Based on the European Central Bank’s reference exchange rate as of 29 March 2017 (RON 1 – EUR 0.2195).
(
13
)	Commission Implementing Regulation of 17 July 2014 laying down rules for the application of Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to the integrated administration and control system, rural development measures and cross compliance (OJ 2014 L 227, p. 69).
(
14
)	Based on the European Central Bank’s reference exchange rate as of 21 April 2017 (RON 1 – EUR 0.2201).
(
15
)	For each of those amounts, the EU-EAFRD’s contribution corresponded to 95% and that of the national budget to 5%.
(
16
)	Based on the European Central Bank’s reference exchange rate as of 21 April 2017 (RON 1 – EUR 0.2201).
(
17
)	Except the conclusion of a new lease for up to three months, since such a duration is, in any event, insufficient to honour the commitment in respect of 2017.
(
18
)	Conversions made on the basis of the European Central Bank’s reference exchange rate as of 21 April 2017 (RON 1 – EUR 0.2201).
(
19
)	I note that paragraph 14 of the reference for a preliminary ruling states that the applicant has in fact received only RON 2 658 185.04 of the amount for which it is liable. However, the sum of the three amounts indicated in the same paragraph of the reference for a preliminary ruling, namely RON 1 506 915.86, RON 850 673.62 and RON 375 941.35, comes to a total of RON 2 733 530.83.
(
20
)	Although it has been repealed and replaced by Regulation No 1305/2013, Regulation No 1698/2005 continues to apply to operations implemented pursuant to programmes approved under that regulation before 1 January 2014 (see Article 88 of Regulation No 1305/2013).
(
21
)	See Section 2 of Regulation No 1698/2005.
(
22
)	Emphasis added.
(
23
)	See, to that effect, judgment of 20 September 2022, VD and SR (C‑339/20 and C‑397/20, EU:C:2022:703, paragraphs 56 and 57 and the case-law cited).
(
24
)	See judgment of 15 July 2021, Ministrstvo za obrambo (C‑742/19, EU:C:2021:597, paragraph 31 and the case-law cited).
(
25
)	See judgment of 18 December 2007, Cementbouw Handel & Industrie v Commission (C‑202/06 P, EU:C:2007:814, paragraph 52 and the case-law cited).
(
26
)	See point 24 of this Opinion.
(
27
)	See point 22 of this Opinion.
(
28
)	Emphasis added.
(
29
)	In accordance with Article 2(h) of Regulation No 1698/2005, ‘beneficiary’ means any ‘operator, body or firm, whether public or private, responsible for implementing operations or receiving support’.
(
30
)	See analysis in the context of the third question referred for a preliminary ruling.
(
31
)	Under Article 8(4)(a) and (b) of Implementing Regulation No 809/2014, once the transferee informs the competent authority and requests payment of the aid and/or support in accordance with paragraph 3(a), ‘all rights and obligations of the transferor resulting from the legal relationship between the transferor and the competent authority generated by the aid application, application for support or payment claim shall be conferred on the transferee’ [(point (a))] and, ‘all actions necessary for the granting of the aid and/or support and all declarations made by the transferor prior to the transfer shall be attributed to the transferee for the purposes of applying the relevant Union rules’ [(point (b))].
(
32
)	See, by analogy, judgment of 4 September 2018, ClientEarth v Commission (C‑57/16 P, EU:C:2018:660, paragraph 80 and the case-law cited).
(
33
)	I note that the second subparagraph of Article 40(2) of Regulation No 1698/2005 states that ‘where necessary and justified, a longer period shall be determined according to the procedure referred to in Article 90(2) for particular types of commitments’ (emphasis added).
(
34
)	See, to that effect, Article 74(1) of Regulation No 1698/2005.
(
35
)	Regulation of the European Parliament and of the Council of 17 December 2013 on the financing, management and monitoring of the common agricultural policy and repealing Council Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No 1290/2005 and (EC) No 485/2008 (OJ 2013 L 347, p. 549).