Keywords

Summary



Keywords

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1. Preliminary rulings ° Admissibility ° Order for reference brief but indicating the doubts of the national court as to the validity of a regulation ° Legal and factual context already familiar by reason of a previous reference for a preliminary ruling ° Question which may be answered

(EEC Treaty, Art. 177)

2. Agriculture ° Common agricultural policy ° Objectives ° Harmonization ° Discretion of the institutions ° Stabilization of the market in raw tobacco ° System of maximum guaranteed quantities ° Legality

(EEC Treaty, Art. 39; Council Regulation No 1114/88)

3. Agriculture ° Common organization of the markets ° Raw tobacco ° System of maximum guaranteed quantities ° Assessment in the light of the principle of proportionality ° Judicial review limited by the discretionary power of the Community legislature in matters of common agricultural policy ° Fact that measures adopted proved ex post facto to have been relatively ineffective irrelevant ° Legality, in the absence of manifestly wrong use of discretion, with regard to the objective pursued

(EEC Treaty, Arts 39(2)(b) and 40 to 43; Council Regulation No 1114/88)

4. Agriculture ° Common organization of the markets ° Discrimination between producers or consumers ° System of maximum guaranteed quantities for the entire Community market set up in the raw tobacco sector ° Reduction of production aid where exceeded ° Application of the reduction to all producers regardless of their contribution to the excess ° No discrimination

(EEC Treaty, Art. 40(3), second subpara.; Council Regulation No 1114/88)

5. Community law ° Principles ° Protection of legitimate expectations ° Limits ° Alteration of the rules relating to a common organization of the markets ° Discretion of the institutions

6. Agriculture ° Common organization of the markets ° Raw tobacco ° System of maximum guaranteed quantities ° Fixing for a given harvest ° Fixing in good time with regard to the farming calendar ° Principle of the protection of legitimate expectations ° Breach ° None

(Council Regulations Nos 1331/90 and 1738/91)

Summary

1. Where an order for reference indicates clearly the doubts of the national court as to the validity of a regulation and is set in a legal and factual context which is already substantially known by reason of a previous preliminary reference made by the same court and concerning the same producer, the brevity of the order for reference cannot be considered to have deprived the interested parties, and in particular the institution which adopted the regulation in question, of the possibility of submitting observations relevant to answering the question referred to the Court. A declaration of inadmissibility would accordingly be incompatible with the spirit of collaboration which must govern a reference for a preliminary ruling.

2. In pursuing the objectives of the common agricultural policy set out in Article 39 of the Treaty, the Community institutions must secure the permanent harmonization made necessary by any conflicts between those aims taken individually and, where necessary, allow any one of them temporary priority in order to satisfy the demands of the economic factors or conditions in view of which their decisions are made. That harmonization must preclude the isolation of any one of those objectives in such a way as to render impossible the realization of other objectives.

Thus Regulation No 1114/88, amending Regulation No 727/70 which introduced a common organization of the market in raw tobacco, cannot be regarded as incompatible with the objectives of the common agricultural policy. In the first place, by introducing a system of maximum guaranteed quantities in order to stabilize the raw tobacco market, which is characterized by over-production, it is pursuing one of those objectives; in the second place, to have given preference to another of those objectives, that of ensuring a fair standard of living for producers and processors of raw tobacco, in particular by increasing their individual earnings, would have involved a serious risk of rendering impossible the stabilization of a market characterized by excess production.

3. Judicial review of compliance with the principle of proportionality by the Community legislature acting in matters of common agricultural policy must take account of its discretionary power in this sphere which corresponds to the political responsibilities given to it by Articles 40 to 43 of the Treaty. Hence the legality of a measure adopted in that sphere can be affected only if the measure is manifestly inappropriate having regard to the objective pursued; since the validity of a Community act cannot depend on retrospective considerations of its degree of efficacy in cases where the Community legislature is obliged to assess the future effects of rules to be adopted and those effects cannot be accurately foreseen, its assessment is open to criticism only if it appears manifestly incorrect in the light of the information available to it at the time of the adoption of the rules in question.

There was no such manifest error of assessment where, by Regulation No 1114/88, the Council introduced, in the raw tobacco sector, a system of maximum guaranteed quantities which, if exceeded, led to a reduction, with a set ceiling, in the intervention price, applicable to all producers, and that system proved insufficiently effective and was subsequently replaced by a system of individual quotas whereby any producer exceeding his quota ceased to obtain support for his excess production. In its choice of a measure which, while not manifestly inappropriate in relation to the objective pursued, did not appear too onerous, the Council complied both with the principle of proportionality and with the need to effect the appropriate adjustments by degrees prescribed by Article 39(2)(b) of the Treaty.

4. The principle of non-discrimination does not preclude Community rules, such as those introduced in the raw tobacco sector by Regulation No 1114/88, consisting of a system of guarantee thresholds for the entire Community involving a reduction in the production aid of the producers of all the Member States, even if exceeding those thresholds was not due to an increase in production in all those States. In a common organization of markets with no system of national quotas all Community producers, regardless of the Member State in which they are based, must together, in an egalitarian manner, bear the consequences of the decisions which the Community institutions are led to adopt, in the exercise of their powers, in order to respond to the risk of an imbalance which may arise in the market between production and market outlets.

5. Whilst the protection of legitimate expectations is one of the fundamental principles of the Community, traders cannot have a legitimate expectation that an existing situation which is capable of being altered by the Community institutions in the exercise of their discretionary power will be maintained; this is particularly true in an area such as the common organization of the markets whose purpose involves constant adjustments to meet changes in the economic situation. It follows that traders cannot claim a vested right to the maintenance of an advantage which they derive from the establishment of the common organization of the markets and which they enjoyed at a given time. A possible reduction in their earnings cannot therefore be contrary to the principle of the protection of legitimate expectations.

6. The fact that, under the system of maximum guaranteed quantities applicable in the raw tobacco sector, the maximum guaranteed quantity for the 1991 harvest for the "Burley I" variety was fixed by Regulation No 1738/91, published at a date when producers had already chosen their crop, is not a breach of the principle of the protection of legitimate expectations since, as regards the variety in question, Regulation No 1738/91 did not alter the maximum guaranteed quantity that had previously, and in good time as far as the farming calendar was concerned, been fixed for the same year by Regulation No 1331/90.