Keywords

Summary



Keywords

1. Agriculture – Common organisation of the markets – Sugar – Temporary scheme for the restructuring of the sugar industry – Quotas

(Council Regulation No 320/2006, Art. 3(1)(b); Commission Regulation No 493/2006, Art. 9)

2. Agriculture – Common organisation of the markets – Sugar – Temporary scheme for the restructuring of the sugar industry

(Council Regulation No 320/2006, Arts 3(1)(b), and 5(1) and (2); Commission Regulation No 968/2006, Art. 11(1))

3. Agriculture – Common organisation of the markets – Sugar – Temporary scheme for the restructuring of the sugar industry – Out-of-quota production

(Council Regulation No 318/2006, Art. 15; Commission Regulation No 968/2006, Arts 26(1) and 27(3))

4. Agriculture – Common organisation of the markets – Sugar – Temporary scheme for the restructuring of the sugar industry – Out-of-quota production

(Council Regulation No 320/2006, Art. 3(5); Commission Regulation No 968/2006, Art. 26(1))

Summary

1. Article 3(1)(b) of Regulation No 320/2006 establishing a temporary scheme for the restructuring of the sugar industry in the Community and amending Regulation No 1290/2005 on the financing of the common agricultural policy must be interpreted as meaning that the term ‘quota’ in that provision also includes the transitional quotas within the meaning of Article 9 of Regulation No 493/2006 laying down transitional measures within the framework of the reform of the common organisation of the markets in the sugar sector, and amending Regulations No 1265/2001 and No 314/2002.

As is apparent from recital 10 in the preamble to Regulation No 493/2006, the transitional quotas were established by that regulation with the aim of increasing, during the 2006/2007 marketing year, the quotas provided by Regulation No 318/2006 on the common organisation of the markets in the sugar sector and, more specifically, Article 7 of that regulation, since those quotas, like the quotas provided under the previously applicable Regulation No 1260/2001 on the common organisation of the markets in the sugar sector, applied for 12 months whereas that marketing year, exceptionally, extended over 15 months. Having regard to that specific objective pursued by the legislature of the Union, which is solely to adjust the volume of the quotas to the exceptional length of the 2006/2007 marketing year, the transitional quotas cannot be considered as being different in nature from those of which they constitute a simple increase intended to achieve that objective. That increase is, moreover, proportional to the exceptional extension of that marketing year.

(see paras 42-43, 51, operative part 1)

2. Article 3(1)(b) of Regulation No 320/2006 establishing a temporary scheme for the restructuring of the sugar industry in the Community and amending Regulation No 1290/2005 on the financing of the common agricultural policy must be interpreted as meaning that the commitment to renounce the quota for the production of sugar, isoglucose and inulin syrup that has been allocated to an undertaking and assigned by it to one or more of its factories, takes effect on the date when, having regard to the information that is communicated to it or that is published in the Official Journal of the European Union, the undertaking that makes that commitment is in a position to know, as a reasonably diligent undertaking, that, in the view of the competent authorities, the conditions for obtaining the restructuring aid set out in Article 5(2) of that regulation have been fulfilled.

As is apparent from Article 5(2) of that regulation, when exercising their competence to decide to grant restructuring aid, under Article 5(1) of Regulation No 320/2006, once they have established that the conditions set out in the former provision have been fulfilled, the Member States have no further discretion to decide that the aid shall not be granted. It follows that an undertaking is in a position to know that it will obtain the restructuring aid as soon as it becomes aware that, in the view of the competent authorities, the conditions to obtain that aid, set out in Article 5(2) of Regulation No 320/2006, have been fulfilled. Such awareness may result from communications made to that undertaking by those authorities after it has applied for the restructuring aid or from the publication made by the Commission in the Official Journal of the European Union concerning the availability of the necessary financial resources in the restructuring fund. In these circumstances it cannot be considered, without infringing the objective pursued by the legislature of the Union by adopting Regulation No 320/2006, which is to restructure the sugar sector in order to reduce unprofitable production capacity in the Union by introducing an economic incentive for undertakings with the lowest productivity, to give up their quota production and renounce the quotas concerned, that the commitment to renounce the quota only takes effect on the date when the restructuring aid is granted, within the meaning of Article 11(1) of Regulation No 968/2006 laying down detailed rules for the implementation of Regulation No 320/2006. Such an interpretation would allow an undertaking which has made a commitment to renounce the quota, and which is sure to obtain restructuring aid in return for that commitment, to continue to produce under the quota that it is supposed to renounce, which runs directly counter to the aim pursued by the legislation at issue.

(see paras 57-61, operative part 2)

3. Articles 26(1) and 27 of Regulation No 968/2006 laying down detailed rules for the implementation of Regulation No 320/2006, and Article 15 of Regulation No 318/2006 on the common organisation of the markets in the sugar sector, must be interpreted as meaning that a production, on the assumption that it is contrary to the commitment to renounce the quota for the production of sugar, isoglucose and inulin syrup that has been allocated to an undertaking and assigned by it to one or more of its factories, may give rise to recovery of the aid, the imposition of a penalty and the collection of the levy on surpluses, as respectively set out in those provisions. With regard to the penalty under Article 27(3) of Regulation No 968/2006, it is for the national court to assess whether, having regard to all the circumstances of the case, the non-compliance can be regarded as having been committed intentionally or as a result of grave negligence. The principles of ne bis in idem , proportionality and non-discrimination must be interpreted as not precluding the cumulative application of those measures.

With regard, in particular, to the principle of ne bis in idem , the recovery of the aid within the meaning of Article 26(1) of Regulation No 968/2006 constitutes withdrawal of a wrongly obtained advantage within the meaning of Article 4(1) of Regulation No 2988/95 on the protection of the European Communities financial interests. As is apparent from Article 4(4) of that regulation, such a measure does not constitute a penalty to which the principle of ne bis in idem is applicable, as is explicitly confirmed in the tenth recital in the preamble to that regulation. The same applies to the levy on surpluses within the meaning of Article 15 of Regulation No 318/2006. It is apparent from Article 5(1) of Regulation No 2988/95 that administrative penalties may be imposed if irregularities, intentional or caused by negligence, have been committed. An irregularity is defined in Article 1(2) of that regulation as, in essence, an infringement of a provision of European Union law. The rules on out-of-quota production, in particular Chapter 3 of Regulation No 318/2006, do not lead to the conclusion that such production must be regarded as an irregularity within the meaning of Article 1(2) of Regulation No 2988/95. It is certainly true that the levy on surpluses represents a substantial economic incentive not to produce in excess of the quota. However, it does not appear from those provisions that out-of-quota production constitutes, as such, an infringement of a provision of Union law and therefore an irregularity that could give rise, under the conditions laid down in Article 5(2) of Regulation No 2988/95, to the imposition of a penalty.

(see paras 70-73, 81, operative part 3)

4. Article 26(1) of Regulation No 968/2006 laying down detailed rules for the implementation of Regulation No 320/206 must be interpreted as meaning that, if an undertaking has complied with its commitment partially to dismantle the production facilities of the factories concerned but not its commitment to renounce the quota for the production of sugar, isoglucose and inulin syrup that has been allocated to it and assigned by it to one or more of its factories, the amount of the aid to be recovered is equal to the part of the aid corresponding to the commitment that has not been complied with. That part of the aid must be determined on the basis of the amounts laid down in Article 3(5) of Regulation No 320/2006 establishing a temporary scheme for the restructuring of the sugar industry in the Community and amending Regulation No 1290/2005 on the financing of the common agricultural policy.

(see para. 92, operative part 4)