4)

The Commission then states that “according to the precepts of the agrimonetary arrangements defended by it and upheld by the Court, the monetary compensatory amounts to be introduced must be limited to the amounts ‘strictly necessary’ to compensate for the incidence of monetary events on the prices of agricultural products covered by intervention arrangements and only where such incidence would cause disturbance in trade in such products within the Community and with non-member countries”. Although in principle the use of the intervention price as the basis for calculating compensatory amounts enables such amounts to be fixed at a minimum level, the Commission recalls that within the organization of the market in cereals the existence of the production refund may, in some cases, cause the market price of starch to be lower than the level resulting from the intervention price of maize. For this reason, for the purpose of calculating the compensatory amounts on the products of the starch industry it took into account not the intervention price “which no longer performs its normal function in determining the market price” but the threshold price which constitutes the most significant price exerting an influence on the market in maize, a product which is in short supply in the Communty. Nevertheless, the case-law quoted by the Commission does not appear to me to support the propositions which it advances. In the Becher case on which this Court delivered judgment on 15 January 1974 ([1974] ECR 19) the Commission argued that it was impossible to transpose automatically the methods applied in calculating the levy to the calculation of the monetary compensatory amount. The seventh paragraph of the decision in the judgment of this Court must be viewed in the light of that argument ([1974] ECR 26). It states as follows: “In fact, by using the concept of ‘prices’ as its starting-point in calculating the compensatory amounts, Article 2 of Regulation No 974/71 does not necessarily oblige the Commission to choose the cif price as a reference price, but leaves it a certain discretion to adopt another price even if the latter differs from the contract prices actually fixed for commercial transactions”. This Court accordingly considered that the Commission was within its powers for the purpose of implementing the first paragraph of Article 2 of Regulation No 974/71, to refer to an average cif price calculated “during a period to be determined” and to refrain from altering that average price unless an appreciable change (generally 10% higher or lower) occurred in relation to the price previously fixed, although the plaintiff in the main action claimed that it was necessary to refer not only to the cif price but also to take account of short-term variations in price. This does not imply, however, that for the purposes of the implementation of the second paragraph of Article 2 the Commission was empowered to choose a price other than that which had been adopted for the purposes of the implementation of Article 2 (1). It is that in the beef and veal sector it is the market price and not the intervention price which is adopted for the purpose of calculating the compensatory amounts. Nevertheless that exception follows from Regulation No 471/75 of the Council of 27 February 1975 which amended Regulation No 974/71 on this point. On being questioned by the Judge-Rapporteurs, the Commission recognized that it exercises its powers under Article 2 (2) in order to increase the protection provided by the levy for producers in countries with hard currencies against non-member countries with the result that this increased protection was accompanied by distortion in intra-Community trade at the expense of countries with depreciated currencies. Such an objective is totally at variance with the third paragraph of Article 1 of Regulation No 974/71 which requires that compensatory amounts shall be fixed only where the monetary fluctuations would lead to disturbances in trade in agricultural products: the method of calculation referred to in Article 2 (2) is not intended to assist in reinforcing the protection against non-member countries provided by the levies and refunds; in any case it may not be accompanied by disturbances in trade between Member States. This Court ruled in its judgment in the Balkan-Import-Export case of 22 January 1976 ([1976] ECR 19) that the Commission must have in mind the effect of the depreciation or the increase in value of currency of a Member State on trade between third countries and that State. This Court laid down that principle in relation to the taking into consideration, within the context of the second paragraph of Article 1 (2), of groups of products coming under the same heading of the Common Customs Tariff; the Court did not lay down any such prinicple in relation to Article 2 (2) of Regulation No 974/71. The Court added that the Commission must also have in mind the effect of that depreciation or increase in value on trade between the different Member States. I hold to the belief that the Commission, by means of “uniformity of treatment”, has made the monetary compensatory amounts perform a function which is not theirs under Article 2 (2) of the basic regulation by claiming that “any provision creating a ceiling requires an economic approach and not a purely arithmetic one”. The calculation of monetary compensatory amounts thereby departs from the function strictly assigned to it in the case-law of this Court. Such an economic objective in the wide sense falls within the powers of the Council alone and not of the Commission. The compensatory amounts must not be a substitute either for the levies or the refunds; if, following their re-adjustment, it proved necessary to review the fixing of the levy on the basic product this would have to be done within the proper framework.