III —

Two questions therefore arise: (a) Does such a system of cultivation licences amount only to a ‘quantitative restriction or measure having equivalent effect’ on production in Member States? (b) Does the Regulation, in particular Article 10, have no other scope than that of Articles 30 et seq. of the Treaty, that is to say the prohibition of restrictions which arise only at the stage of exporting the products? 1. As regards the first point, it seems to me that a system of cultivation licences, even if the concessions granted — on payment of a substantial duty — are not completely made use of, constitutes in itself a measure that amounts to imposing production quotas and which by reason of this very fact has a potential effect upon the marketing of the product under review. In this respect the Court by its judgment in the Geddo case of 12 July 1973 (Case 2/73, [1973] E.C.R. 865) found that ‘measures having equivalent effect not only take the form of the restraint described [total or partial restraint of imports or exports]; whatever the description or techniques employed they can also consist of encumbrances having the same effect’. Admittedly, the Court made this statement in connexion with a financial charge payable upon certain products at the time of the contract relating thereto, but it seems to me perfectly applicable to a system of production quotas. Whilst recognizing this, the Commission nevertheless adds that ‘national regulations by which a State quantitatively limits certain productions cannot normally be termed quantitative restrictions or measures having equivalent effect (already condemned by Article 30 et seq. of the Treaty)’. The Commission considers that the scope of the prohibition of quantitative restrictions (or of any measure having equivalent effect) in the internal trade of the Community, contained in Article 10 of the Regulation, is no different from that of the prohibition of quantitative restrictions upon export (or any measure having equivalent effect) as between Member States, contained in Article 34 of the Treaty. Nevertheless the Court found by its Judgment in the Bilger case of 18 March 1970 (Rec. 1970, p. 136) that the expression ‘relate either to imports or to exports’ has a narrower meaning than the expression ‘affect trade between Member States’. Admittedly, what was involved in that case was the assessment of a contract for delivery in the light of the competition rules. But the Court did on that occasion emphasize that the notion of ‘internal trade of the Community’ and that of ‘import and export between Member States’ do not overlap. An agreement to impose production quotas between undertakings might affect internal trade and it is not therefore impossible that restrictions on production laid down by a Member State might affect the internal trade of the Community. I consider therefore that the prohibition in Article 10 of the Regulation has a scope wider than that of Article 34, all the more so, since it appears in a common organization of the market. 2. And there is more to this. The common organizations of the markets in the field of agriculture cover not only trade in agricultural products, but also their production. Admittedly, bearing in mind the important differences that exist between Member States in the field of national organizations of the market, as well as the diversity of conditions that govern the trade in agricultural products — i.e. differences which relate inter alia to the very nature of the goods concerned — it is provided in the framework of the common agricultural policy that the common organization can take several forms (Article 40 (2)). By definition, any common organization of the market must, in order to replace existing national organizations, include equivalent safeguards for the employment and standard of living of the producers concerned (Article 43 (3)). In the sector under consideration, I am of the opinion that Article 43 (3) was put into operation by Regulation No 234/68. It follows that any quantitative restriction of production is henceforth prohibited in this sector, the only permissible exceptions being those which arise from the elimination of products not in conformity with Community standards or from derogations justified by Article 36, or further, such as are the subject-matter of express provisions. As from 1 July 1968, the markets in live trees and other plants, bulbs, roots and the like, cut flowers and ornamental foliage became the subject-matter of a definitive, though in certain respects perhaps still incomplete organization. A fortiori, this must be so at the end of the transitional period: if no complementary measure was taken, this is because it was not thought necessary to adopt one. By its Judgment in the S.A.l.L. case of 21 March 1972 (Rec. 1972, p. 119) the Court found that in such a case it is solely for the Community authorities to decide on the provisional maintenance of any national system of organization, intervention or control relating to the products in question. One can likewise derive arguments from the Judgment in the Grosoli case of 12 December 1973, (Case 131/73, [1973] E.C.R. 155) by which the Court found that the absence of Community provisions for determining the appropriation of an import quota for an agricultural product does not allow a Member State itself to take restrictive measures of a kind affecting the objectives of the agricultural policy pursued by the Community authorities. Likewise, one cannot, because of the absence in Regulation No 234/68 of any formal prohibition of a national provision (such as the prohibition in Article 12 of Regulation No 727/70 of the Council of 21 April 1970 on the common organization of the market in raw tobacco, provisions which give certain persons the exclusive right to grow tobacco) argue that such a provision is compatible with the application of the Regulation in question. Nor can one base an argument on the tolerance of the Community authorities when faced with this kind of situation. It is said that there is nothing to show that up to the present time this system has caused difficulties in the distribution of competing products of the importing Member States. This is not at all surprising, given the dominant position of the Netherlands in the field of hyacinth bulb production. But it is not only a matter of this: in the first place it is admittedly necessary for the producers of other Member States to be able to acquire, if not in their own countries, then at least in the Netherlands, all the bulbs for the production of cut flowers or for reproduction which they may require and under the same conditions as their Dutch competitors; but it is also necessary that there should be no discrimination between producers in the Netherlands. And the present case, in the light of the precedents quoted by Mr Van Haaster, shows that this is not so. It has become impossible, in particular due to the system of cultivation licences. If it does not directly establish a case of quantitative restrictions upon exportation, yet such a system, by limiting production, necessarily results in reducing the quantities of goods capable of being injected into the trade between Member States.