61988CC0217_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
++++
My Lords,
1 . This case raises a point of principle concerning the obligations of Member States to give effect to Community regulations .
2 . Article 41 of Council Regulation ( EEC ) No 337/79 on the common organization of the market in wine ( Official Journal 1979 L 54, p . 1 ), as amended by Council Regulation ( EEC ) No 2144/82 ( Official Journal 1982 L 227, p . 1 ) and by Council Regulation ( EEC ) No 1208/84 ( Official Journal 1984 L 115, p . 77 ), requires the Commission, in certain circumstances, to order the compulsory distillation of table wine in the event of a surplus . Under Article 6(1 ) of Regulation No 337/79, wine-growers who do not comply with the obligation to distil are excluded from the benefit of the intervention measures provided for in the legislation . Article 64(1 ) states that "Member States shall take all necessary measures to ensure compliance with Community provisions in the wine sector ".
3 . On 18 January 1985 the Commission adopted two regulations concerning the distillation operation in the 1984/85 wine-growing year . By Regulation ( EEC ) No 147/85 ( Official Journal 1985 L 16, p . 25 ) it laid down the method for calculating the total quantity of wine to be distilled, the criteria for dividing that quantity between the different regions of production and between the producers established in each region and the categories of producers relieved of the obligation to distil . By Regulation ( EEC ) No 148/85 ( Official Journal 1985 L 16, p . 32 ) it ordered the distillation of 12 000 000 hl of table wine, of which 68 322 hl were to be distilled by German wine-growers .
4 . The German authorities forthwith issued notices to 614 German wine-growers informing them of the quantity of wine that they were required to distil . Of these, 506 lodged appeals, arguing essentially that the criteria used by the Community regulations to determine the amount to be distilled by each wine-grower were discriminatory .
5 . Under German law, an appeal against an administrative decision has automatic suspensory effect . However, the administrative authorities may order the immediate enforcement of a decision if the public interest so requires . Such an order may itself be appealed against, in which event the administrative courts may again suspend the decision .
6 . The German authorities decided against ordering the immediate enforcement of the 506 notices against which appeals had been lodged . In the event, of the 68 322 hl of wine that should have been distilled in Germany, only 9 140 were in fact distilled .
7 . The Commission took the view that Germany' s failure to take any further action to force the German wine-growers to participate in the scheme for compulsory distillation constituted a breach of Article 64(1 ) of Regulation No 337/79 and of Article 5 of the EEC Treaty . It therefore set in motion the procedure laid down in Article 169 of the Treaty . In response to the Commission' s letter and reasoned opinion Germany denied that its conduct amounted to a failure to fulfil obligations under Community law . The Commission therefore lodged an application at the Court on 2 August 1988 .
Admissibility
8 . The Commission' s application is directed not only against Germany' s past conduct in one specific wine-growing year ( 1984/85 ) - the only year to date in which Community regulations have imposed compulsory distillation on German wine-growers - but also against its express intention to pursue the same line of conduct in the future . The declaration sought by the Commission is accordingly formulated not in terms of the Federal Republic' s failure to take the necessary measures in the period 1984-85 but in terms of its "continuing refusal" to take such measures, i.e . for the future; and the Commission even states in its application that the case relates principally to the future rather than to the past . Germany, however, submits that the application is admissible only in so far as it relates to its conduct in the specific circumstances of the 1984/85 wine-growing year .
9 . The Commission' s approach in my view confuses two different things . For the purpose of the present proceedings, it is sufficient to examine, on the substance of the case, the conduct of the German authorities in 1985 . The fact that they might behave in a similar way in the future, and have expressed their intention of doing so unless the Court rules to the contrary, is certainly relevant to establish the interest of the Commission in pursuing these proceedings; but it is unnecessary to include in the subject-matter of these proceedings either the general attitude of the German Government or the issue how it may act in the future . In so far as a similar situation should arise in the future, the ruling of the Court in this case will determine the issues . I therefore consider that the application should be declared admissible only in so far as it relates to the German authorities' specific conduct in the 1984/85 wine-growing year .
10 . If the subject-matter of the proceedings is limited in that way, it will be unnecessary to consider separately the subsequent legislation : Regulation No 337/79, which was applicable in 1984-85, was replaced by Regulation ( EEC ) No 822/87 ( Official Journal 1987 L 84, p . 1 ); the corresponding provisions in the latter regulation are contained in differently numbered articles ( see Annex VIII to the latter regulation ) but the relevant provisions are substantially the same .
Substance
11 . As regards the substance, the Commission' s case is very simple . It maintains that, by virtue of the general duty of cooperation imposed on the Member States by Article 5 of the Treaty and the specific duty imposed by Article 64(1 ) of Regulation No 337/79, Germany was not entitled to abandon the attempt to enforce compulsory distillation when 506 of the 614 German wine-growers appealed against the notices requiring them to distil . It should, according to the Commission, have done everything possible under national law to compel the recalcitrant wine-growers to comply with their obligations under Community law . In particular, it should have ordered the immediate enforcement of the 506 distillation notices, pursuant to Article 80(2 ) of the German Code of Administrative Procedure ( Verwaltungsgerichtsordnung ).
12 . In its defence, the German Government puts forward a number of arguments, which I will examine in turn .
( a ) The argument based on the exhaustive nature of the sanction provided for in Article 6(1 ) of Regulation No 337/79
13 . The German Government argues that the Community legislation on the market in wine already provides for a sanction against wine-growers who disregard an order to distil, inasmuch as Article 6(1 ) of Regulation No 337/79 ( Article 47(1 ) of Regulation No 822/87 ) excludes them from the benefit of certain intervention measures for the following campaign . The German Government maintains that this sanction is exhaustive and thus precludes recourse to coercive measures under national law . On this point it cites two judgments : Case 40/69 Hauptzollamt Hamburg v Bollmann [1970] ECR 69 and Case 50/76 Amsterdam Bulb v Produktschap voor Siergewassen [1977] ECR 137 .
14 . I do not find that argument at all convincing . In my view, the German Government has failed to show why the sanction provided for in Article 6(1 ) of Regulation No 337/79 should have the exhaustive effect attributed to it . Article 6(1 ) is located in Title I of the regulation, which bears the heading "Prices and intervention ". As amended by Article 1 of Regulation No 2144/82, it provides as follows :
" Producers subject to the obligations referred to in Article 39 and, where appropriate, Articles 40 and 41, shall be entitled to benefit from the intervention measures under this title provided they have complied with the above obligations for a reference period to be determined ."
Articles 39 to 41 belong to Title IV of the regulation, which lays down "Rules concerning oenological processes and conditions for release to the market ". Those articles, as amended, together with other provisions of Title IV, lay down a number of obligations and prohibitions . Article 39(1 ) prohibits the overpressing of grapes, the pressing of wine lees and the refermentation of grape marc for purposes other than distillation . Article 40(1 ) requires the distillation of wine made from grapes belonging to varieties not listed as wine grape varieties . And, as we have seen, Article 41 provides for compulsory distillation in certain circumstances .
15 . If the German Government' s argument concerning the exhaustive nature of Article 6(1 ) were accepted, it would mean that none of the obligations or prohibitions laid down in Articles 39 to 41 could be enforced by any means other than exclusion from the benefit of intervention measures under Article 6(1 ). It would mean for example that the national authorities would be unable to apply for a court order restraining wine-growers from infringing those prohibitions . Wine-growers would thus be allowed to engage in oenological processes that are prohibited by Community law and the national authorities would have no means of preventing them from so doing, unless of course the sanction provided for in Article 6(1 ) proved effective . I cannot see anything in the wording of Article 6(1 ) or in the scheme of the regulation to justify such a conclusion . On the contrary, the German Government' s argument runs directly counter to the express terms of Article 64(1 ), which requires Member States to take "all necessary measures to ensure compliance with Community provisions in the wine sector ".
16 . Nor is the German Government' s contention supported by the case-law that it cites . In the Bollmann judgment the Court held that Member States "are precluded from taking steps, for the purposes of applying (( a regulation )), which are intended to alter its scope or supplement its provisions ". But by taking steps under national law to enforce an obligation arising under a regulation, the national authorities are not altering the scope of that regulation or supplementing its provisions; they are merely giving effect to it . That point was very clearly made by Advocate General Capotorti in his Opinion in the Amsterdam Bulb case, already cited, at p . 155 .
17 . In its judgment in that case the Court stated ( at paragraph 33 ) that "in the absence of any provision in the Community rules providing for specific sanctions to be imposed on individuals for a failure to observe those rules, the Member States are competent to adopt such sanctions as appear to them to be appropriate ".
18 . Presumably the German Government cites that judgment with a view to establishing a contrario that, where the Community rules do provide for specific sanctions, the Member States no longer have the power to adopt sanctions under national law . That might be so where a regulation provided for a complete set of sanctions intended to exclude any provision for sanctions under national law, as in the example given by Advocate General Capotorti ( loc . cit .) of the sanctions provided for by Regulation No 17 for breach of the EEC competition rules .
19 . Such an inference cannot, however, be drawn from Article 6(1 ) of Regulation No 337/79, which merely denies the benefit of certain intervention measures to producers who fail to comply with some of the obligations arising from the regulation . As the Commission has pointed out, there was no guarantee that that particular sanction would in all circumstances be effective and indeed it seems to be common ground that, owing to the situation on the German wine market in the years after 1985, the sanction proved singularly ineffective in the circumstances of the present case . Regulations must be interpreted to render them effective, not the reverse; but the German Government' s argument would be liable, as the present case shows, to render the regulation ineffective . And, once again, the argument cannot be reconciled with Article 64(1 ) of the regulation, which requires Member States to take all necessary measures to ensure compliance with the Community provisions .
( b ) The argument based on the principle of legality
20 . The German Government' s second argument is that it is not permissible to have recourse to coercive measures under national law unless such a possibility is expressly provided for by a specific provision of Community law . On this point, it cites the Court' s judgment in Case 117/83 Koenecke v BALM [1984] ECR 3291 .
21 . In that judgment the Court held that a penalty, even of a non-criminal nature, cannot be imposed unless it rests on a clear and unambiguous legal basis .
22 . The Court thus set out a principle of administrative law which may be described as the principle of legality . A related principle, in the field of criminal law, requires that no one can be punished unless the offence in question was expressly prohibited by law at the time of its commission and the penalty imposed was likewise expressly provided for by law : nullum crimen sine lege and nulla poena sine lege . I do not see how that principle of law could have been invoked by the German wine-growers in the circumstances of the present case if the German authorities had attempted to enforce the distillation notices against them .
23 . In the first place, it is questionable whether an order requiring someone to perform an obligation imposed by law can be equated with a penalty, even though defiance of such an order may lead ultimately to the imposition of a penalty . Secondly, in the present case the obligations incumbent on the German wine-growers were clearly spelt out in the Community legislation, in particular by Article 41 of Regulation No 337/79, as amended, and by the provisions of Regulation No 147/85, and the Member States were clearly under a duty to enforce those obligations by all means available to them under their national legal systems . That is simply a consequence of the direct applicability of regulations under Article 189 of the Treaty . By virtue of that direct applicability, the obligations imposed by regulations are directly enforceable . Strictly speaking, therefore, the duty of Member States to take all necessary measures to enforce such obligations is inherent in the very nature of a regulation, and Article 64(1 ) of the regulation in issue in this case can be regarded as spelling out, for the avoidance of any possible doubt, what would in any event be required of Member States . As regards the procedures, and if necessary the sanctions, to be used by the Member States, those are, in the absence of specific Community provisions, a matter for national law : Community law requires only that the procedures followed, and if necessary the sanctions imposed, should be effective . Those principles apply both where the Community provisions confer rights on the individual and where they impose obligations on him : see for example Case 265/78 Ferwerda v Produktschap voor Vee en Vlees [1980] ECR 617, at p . 629, paragraph 10, and Joined Cases 66, 127 and 128/79 Amministrazione delle finanze v Salumi [1980] ECR 1237, at p . 1263, and compare Case 68/88 Commission v Greece [1989] ECR 2965 and the Opinion of Advocate General Van Gerven in Case C-326/88 Anklagemyndigheden ( Ministère public ) v Hansen & Soen I/S, point 8 .
24 . It is plainly unnecessary for a Community regulation to provide expressly, as the German Government' s argument appears to suggest, that the obligations it imposes are enforceable . Moreover it would be impracticable and indeed undesirable for Community regulations to contain specific provisions laying down the procedures and the sanctions by which such obligations are to be enforced in each of the Member States .
25 . Accordingly the German Government' s argument must be rejected .
( c ) The arguments based on proportionality and on certain features of German administrative law
26 . The government' s remaining arguments are not clearly distinguished in the pleadings and I will take them together . The government maintains that the German authorities would have incurred a disproportionate administrative burden if they had been required to order the immediate enforcement of the 506 distillation notices and defend that decision against the numerous appeals that would inevitably have ensued . It points out that the quantity of wine to be distilled by German wine-growers was insignificant in relation to the total amount to be distilled throughout the Community . Moreover, the second subparagraph of Article 41 of Regulation No 337/79 as amended provides that "compulsory distillation shall be decided on only if such distillation does not entail a disproportionate administrative burden ". In addition, the ninth recital in the preamble to Regulation No 2144/82 states that implementation of the compulsory distillation programme must not involve an administrative burden out of proportion to the results aimed at in terms of quantity . The effect of Article 64(1 ) of Regulation No 337/79 and of Article 5 of the Treaty is only, according to the German Government, to require Member States to take such measures as are, in the circumstances, necessary and appropriate .
27 . The German Government also pleads a number of considerations relating to the peculiar features of German administrative law . Under German law, as mentioned above, an appeal against an administrative decision has automatic suspensory effect . Although the authorities can order the immediate enforcement of an administrative decision, under Article 80(2 ) of the Code of Administrative Procedure, that can be done only if special considerations pertaining to the public interest so require . Such an order could itself be appealed against, in which event the courts would restore the suspensory effect of the original appeal, unless they were satisfied that the requirement of special considerations pertaining to the public interest was fulfilled . The German Government considers that the courts would have construed that requirement strictly in the present case because the enforcement of the distillation orders would have had irreparable consequences for the German wine-growers . The German Government concludes that, in view of the grave doubts about the validity of the Community legislation on compulsory distillation, which is allegedly discriminatory, it is far from certain that the German courts would have dismissed appeals against orders for immediate enforcement .
28 . In my view, these arguments must be rejected as a matter of principle . In the first place, it is not in my view open to the German Government to rely in support of its argument on the terms of Article 5 of the Treaty, which requires Member States to take "all appropriate measures ... to ensure fulfilment of the obligations arising out of this Treaty", or on the terms of Article 64(1 ) of Regulation No 337/79, which requires them to take "all necessary measures to ensure compliance with the Community provisions in the wine sector ". The words "appropriate" and "necessary" cannot be construed as exonerating the German Government from its obligation to ensure that the regulation was implemented; on the contrary, those provisions require the complete fulfilment by Member States of their Community obligations . Article 5 of the Treaty gives Member States a choice of methods ( see the Amsterdam Bulb case, already cited, at p . 150, paragraph 32 ), but it does not allow Member States to refrain from fulfilling their obligations on the ground that to do so would impose on them a disproportionate burden .
29 . Secondly, it is not open to Member States to rely on the special features of their legal systems by way of defence where they have failed to carry out their Community obligations . It is well established that a Member State may not rely upon provisions, practices or circumstances existing in its internal legal system in order to justify a failure to fulfil obligations arising under Community law : see, for example, Case 254/83 Commission v Italy [1984] ECR 3395 . In particular, a Member State may not plead administrative difficulties existing in that State in order to justify such a failure : see Case 58/83 Commission v Greece [1984] ECR 2027 . Moreover, to allow such a defence as that invoked by the German Government here would obviously prejudice the uniform application of Community law : the application of Community law would be at the mercy of the procedural peculiarities of each national legal system .
30 . Thirdly, to the extent that the German Government in effect relies on the alleged invalidity of the Community legislation, that argument also must in my view be rejected . The government does not directly challenge the validity of the legislation, but that is what its argument in substance amounts to . If the government considered that Regulation No 148/85 was invalid, whether as infringing the principle of non-discrimination or the principle of proportionality, then it was open to it to take proceedings for its annulment under Article 173 of the Treaty and to apply for an interim order suspending its application under Article 185 . The question might arise whether, having failed to do that, the government can now indirectly seek to dispute the validity of the regulation in proceedings brought against it under Article 169 of the Treaty for failing to implement the regulation . But it is unnecessary to address that question since in my view the government cannot, in any event, rely on the conjecture that the German courts would have considered the regulation invalid ( apparently on grounds of discrimination, although the government does not develop that issue ). Community regulations must be presumed to be valid until they have been held invalid by a competent court : see Case 101/78 Granaria v Hoofdproduktschap voor Akkerbouwprodukten [1979] ECR 623, at p . 636, paragraph 4 . The "competent court" is the Court of Justice, since the national courts have no jurisdiction to decide that a Community regulation is invalid : see Case 314/85 Foto-Frost v Hauptzollamt Luebeck-Ost [1987] ECR 4199 . Moreover, even if the government considered that the courts might have taken the view that the Community measures were invalid, that cannot dispense the government from even attempting to initiate the enforcement measures in question . That omission was itself sufficient, in my view, to constitute an infringement of the Treaty, inasmuch as the German authorities failed to take a step that was necessary and appropriate in order to ensure implementation of the compulsory distillation programme .
31 . It is therefore also unnecessary to consider whether, as the German Government maintains, the German courts might have suspended the implementing measures, or whether those courts could properly take that step . It is indeed questionable whether, and if so under what conditions, the national courts can suspend the operation of measures designed to implement Community regulations . I will limit myself to observing that on the facts of this case it is in any event doubtful whether suspension of the measures would have been an appropriate course for the German courts to take, even on the assumption that they had the power to do so and that they would have had doubts about the validity of the Community measures . First, such a suspension would have prejudged the decision on the substance of the case inasmuch as it would have rendered the purpose of the compulsory distillation - namely, to maintain price levels in the 1984/85 wine-growing year - unattainable . Secondly, contrary to the contention of the German Government, suspension could not have been justified on the ground that the enforcement of the distillation notices would have caused irreparable harm to the wine-growers . Any damage sustained could have been made good by financial compensation .
32 . There remains the German Government' s argument to the effect that the quantity of wine involved was so small, in comparison with the total amount to be distilled in the whole Community, that its distillation would have had no appreciable effect on the price level and that there was therefore no point in taking further action to ensure that the distillation took place .
33 . That argument must in my view be rejected . It is clear from the relevant regulations that this aspect of proportionality has been dealt with exhaustively by the legislature and that the national authorities are given no discretion to decide that certain quantities are too insignificant to justify recourse to enforcement measures under national law .
34 . Thus, when the Council provided in the second subparagraph of Article 41(1 ) of Regulation No 337/79 that "compulsory distillation shall be decided on only if such distillation does not entail a disproportionate administrative burden", its sole intention was to confer on the Community legislature ( i.e . the Commission acting under the management committee procedure ) a discretionary power to refrain from ordering compulsory distillation where the stock level referred to in the first subparagraph was only slightly exceeded; such a provision was necessary because of the mandatory terms in which the first subparagraph was drafted (" compulsory distillation of table wine shall be decided upon "). That provision obviously does not confer any discretion on the national authorities charged with implementing the compulsory distillation operation, as in fact the German Government concedes in its rejoinder .
35 . Further provision to avoid a disproportionate administrative burden was made by the second subparagraph of Article 41(7 ) of Regulation No 337/79, which allows exemption from compulsory distillation for producers of small quantities . It was in accordance with that provision that Article 4 of Regulation No 147/85 exempted ( a ) producers in Member States whose table wine production did not exceed 60 000 hl in the 1984/85 wine year and ( b ) producers who would be obliged to deliver for compulsory distillation less than five hectolitres of wine . It should be noted that the figure of 60 000 hl mentioned under ( a ) refers to total "table wine production", not to the quantity required to be distilled . In the light of these provisions it is difficult to accept the German Government' s argument that the total quantity of table wine that remained undistilled ( 59 000 hl ) was too small to justify further effort or that the amount to be distilled by each producer ( an average of 116 hl ) was disproportionately small in relation to the administrative burden that it entailed . The Community legislature clearly had a different view as to what was an acceptable administrative burden, proportionate to the aim pursued .
36 . In so far as the German Government seeks to argue that enforcement would have placed a disproportionate burden on the German authorities, I think it is clear - even assuming that such an argument is in principle admissible - that it cannot succeed in the present case, where the government has not taken the prior step of declaring the distillation notices immediately enforceable . As the Court has repeatedly stated ( see for example Case 128/78 Commission v United Kingdom [1979] ECR 419, at p . 429, paragraph 10 ), practical difficulties which appear at the stage when a Community measure is put into effect cannot permit a Member State unilaterally to opt out of fulfilling its obligations . The German Government' s defence must therefore fail .
Costs
37 . Although the Commission' s application is in my view admissible only in part, I consider that the Federal Republic, having failed on the substance of the case, should be ordered to pay the costs .
Conclusion
38 . Accordingly, the Court should in my opinion :
( 1 ) declare that by failing to take the necessary measures to ensure the compulsory distillation of table wine in 1985, the Federal Republic of Germany has failed to fulfil its obligations under the Treaty;
( 2 ) order the Federal Republic to pay the costs .
(*) Original language : English .