OPINION OF MR ADVOCATE-GENERAL MAYRAS

DELIVERED ON 29 JUNE 1977 ( 1 )

Mr President,

Members of the Court,

Three French companies, sugar merchants, Debayser, Sucres Union and Jean Lion & Cie., have brought before this Court, by identical applications, applications for an order that the Commission should pay them damages on the basis of the non-contractual liability incurred by that institution owing to the misapplication or improper application of its Regulation No 1608 of 26 June 1974 on special provisions in respect of monetary compensatory amounts.

It is necessary first of all to explain the structure and to analyse the provisions of this Community regulation before coming to the circumstances in which the applicants were prompted to invoke the liability of the Commission.

It should be borne in mind that the Council, as a result of the international monetary crisis, introduced by means of Regulation No 974/71 a system of monetary compensatory amounts which was at that time only applicable in the case of a revaluation of the national currency of certain Member States but did not as yet provide for a corrective mechanism in the opposite case of a devaluation. For this reason the Council adopted Regulation No 509 in 1973 which completes the original regulation in this respect.

However, since this mechanism was of a fixed nature it could not take into account the special circumstances of the various individual transactions and experience showed that those rules were unable to mitigate the disadvantages resulting from specific situations in which traders suffered inevitable losses, in particular because the monetary compensatory amounts charged on exports could not be fixed in advance and because their rate is that in force on the actual date of exportation.

In order to take these difficulties into account, difficulties which were particularly serious for French exporters, the Commission adopted Regulation No 1608/74, Article 1 of which provides that:

‘Where monetary compensatory amounts are introduced or increased as a result of the fixing or the amendment of the central rate or of the representation rate of the currency of a Member State used in the context of the common agricultural policy, or where the decision of a Member Sute to permit its currency to float in relation to the currencies of the Member States where the fluctuation of the rates of exchange is kept within a maximum spread of 2.25 % [that is, beyond the limits of the monetary snake], the Member Sute in question shall be authorized to waive, on a discretionary basis and according to the following conditions, the monetary compensatory amount or so much thereof as corresponds to the increase.’

However, under Article 2 that simple power granted to the Member States is made subject to strict conditions:

First, Article 1 may apply only to imports and exports carried out pursuant to binding contracts concluded before the monetary measure referred to in that article.

Secondly, the Member Sute concerned may make use of the authorization referred to in Article 1 only at the request of the interested party and if such party, at the time of making the request, furnishes proof that:

(a) in the case in question it is not necessary to levy the newlyintroduced or increased monetary compensatory amount to compensate for the effects of the monetary measures referred to in that article on the price of the product; and that

(b) to levy such amount would constitute an excessive additional burden for him, which he could not avoid even taking all the necessary and normal care.

This regulation therefore provides, for national authorities, in particular where a Member Sute decides to permit its currency to float beyond the limits of the monetary snake, the power, and not the duty, to exempt from the monetary compensatory amounts in particular exports carried out pursuant to binding contracts finally concluded before the monetary measure was adopted, that is, in this case, the decision to permit the national currency to float freely.

This system was applied in France as a result of the decision taken on 15 March 1976 to permit the franc to float.

This step constituted, within the meaning of Article 1 of Regulation No 1608/74, the ‘monetary measure’ which was to involve both the reintroduction as from 25 March of the monetary compensatory amounts on trade in agricultural products between France and third countries in particular and any benefit of the power to exempt French exporters from those compensatory amounts or at least from an increase in them.

However, what happened was that those monetary compensatory amounts, which were first fixed at the rate of FF 4.46 per 100 kilograms of sugar by Commission Regulation No 572/76 of 15 March 1976, then raised to FF 4.85 as from 1 July because of the increase in the intervention price for sugar, underwent a large increase as a result of the depreciation of the French franc. In fact their rate reached FF 32.67 per 100 kilograms at the end of 1976.

The three applicants therefore applied to the competent French agency, the Fonds d'Intervention et de Régularisation du Marché du Sucre (Fund for Intervention in and Regulation of the Market in Sugar, hereinafter referred to as ‘the Fund’) for exemption from the compensatory amounts which had to be charged on exports to third countries.

The applicants obtained exemption in respect of the binding contracts which had been concluded before 15 March 1976 and which fulfilled the conditions laid down in Article 2 of Regulation No 1608/74. The Fund notified them of a favourable decision of principle, although most of those contracts were still under consideration at the date on which the application were lodged. Those contracts are therefore extraneous to the subject-matter of the dispute.

On the other hand, the applications for exemption made in respect of the contracts concluded after 15 March 1976 were rejected by the Fund on 2 August 1976.

The applicants did not appeal before the competent national court against that decision.

They approached the Commission, doing so indirectly, however, by drawing, through the president of the association of sugar traders, the attention of the member of that institution responsible for agriculture to the difficulties which French exporters were experiencing in this case.

The Director General for Agriculture of the Commission replied on 7 December 1976 to this request for information, merely recalling in general terms the rules in question and explaining the problems which their amendment would raise.

This reply is at the origin of these applications for compensation by which the applicants seek to invoke the noncontractual liability of the Community in reliance upon Article 178 and the second paragraph of Article 215 of the EEC Treaty by requesting this Court to order the Commission to pay damages of FF 668277.81 to Debayser, FF 1560886.55 to Sucres Union and, finally, FF 539325.53 to Jean Lion et Cie., in other words, to reimburse the increase in the compensatory amounts which they allege was paid in error.

The Commission raises in limine an objection of inadmissibility to those applications on the ground that the disputes in question should allegedly have been brought before the national court, even though the latter could consult this Court, if necessary, by means of a reference for a preliminary ruling on the interpretation or the validity of the Community regulation in question.

The Commission bases its first submission on Article 1 of that regulation which, by giving the Member Sute concerned authorization to exempt traders from the compensatory amount chargeable or from the increase in that amount on a discretionary basis, results from two considerations.

First, it follows dearly from the wording of that article that it is essentially for the national authorities to apply the Commission regulation; they are themselves responsible therefor and the reason for this is, moreover, expressly stated in the fifth recital of the preamble to that regulation in which the Commission specified that ‘it is, in principle, desirable to entrust the administration of the rules concerned to Member States; … they are in fact better placed to judge the circumstances and to verify the facts of the case’ ; in other words, to decide whether the transactions referred to by the regulation may give rise to a discretionary exemption from the compensatory amounts within the limitis laid down by that regulation.

This power given to the national authorities, which is based on considerations of natural justice which are appropriate to certain individual situations, therefore grants them a singularly wide margin of discretion which, in this case, considerably exceeds the scope normally given them for the mere execution of Community regulations.

Although the freedom of discretion of the national agencies is limited by the special conditions laid down by Regulation No 1608/74, the first of those conditions would be sufficient in this case to justify the fan that the Fund was unable to make use of the power to waive the increased compensatory amounts in respect of the applicants on the occasion of the exports in question. In fan I should remind the Court that under the actual wording of Anide 2 (1), this power may only apply to transactions of that nature ‘carried out pursuant to binding contracts concluded before the monetary measure’ referred to in Article 1.

In my opinion it is established that the monetary measure in question which constitutes the event giving rise to the application of the regulation is the decision adopted on 15 March 1976 by the Government of the French Republic to allow the franc to float beyond the limits of fluctuation permitted in relation to the currencies of the Member States in what is customarily called the ‘monetary snake’.

The contracts at issue are those which, according to the statements of the applicants themselves, were concluded after that monetary measure had been adopted.

The successive depredation affecting the French currency between July and December 1976 cannot be assimilated to such a measure.

This consideration amounts in my opinion to expressing that the national intervention agency in fact no longer had in respect of those contracts the power of exemption which it granted, in exercise of its discretion, in respect of the binding contracts concluded before 15 March 1976. Although that factor is, as regards this Court, superfluous, it should however have an influence on the decision of national judges called upon, if the occasion arises, to give a judgment concerning the legality of a decision of rejection given by the Fund.

To come back to the possible liability of the Commission, can it be said that the latter had both the means and the duty to control the way in which administrations apply its regulation, as they are under a duty to do? This involves asking the question what powers the Commission has reserved to itself in order to ‘follow with particular attention the application of the provisions laid down in order to take, if necessary, further measures and to determine whether this system should be maintained’.

It is true that by Articles 4 and 5 of the regulation, the Commission intended to keep watch on the exercise which national authorities would make of the power of exemption granted to them after the entry into force of the regulation.

For that purpose Article 4 establishes an a prion control in specific cases in which a Member State intends to make use of the authorization provided for in Article 1 in respect of a contraa the duration of which exceeds:

— the period of validity of the [import or export] certificate where the certificate includes a prior fixing of the levy or the rebate in excess of three months, or

— generally, where the period of execution of the contraa is more than three months.

In such cases, the Member State concerned is under a duty to inform the Commission of its intention specifying the reasons therefor and the evidence supplied and may make use of the authorization to exempt the trader from the compensatory amount only if the Commission raises no objection to the proposed measure within a period of six weeks.

Apart from the cases thus laid down in Article 4, the Commission, under Article 5, systematically carries out a general control on the implementation by the national authorities of the provisions of the regulation. The latter must in fact inform it of the criteria which they intend to adopt for the application of the authorization referred to in Article 1 and notify it of the list of the cases in which they propose to make use of that authorization.

Moreover, the States must notify it every three months of deuils of the cases in respect of which they have in fact utilized the authorization.

Armed with such information and notifications, the Commission may therefore ensure the coordinated application of the rules by each of the Member States and will thus be able, if the need arises, to adopt the supplementary measures which prove necessary.

An analysis of those provisions leads me to two observations :

The first is that although the Commission has provided itself with powers of administrative supervision of the action of the Member States in this respect the latter, or at least their competent administrations, are not for all that released from their liability in respect of the application of Regulation No 1608/74. It is therefore impossible in my opinion to invoke directly the liability of the Commission in what is alleged to be a misapplication of the power of exemption which, apart from the specific case referred to in Article 4, only the national authorities possess.

In addition it follows clearly from the provisions of Article 4, within the limits of that regulation, that the Commission has only reserved to itself the power to intervene a prion in the actual application of its regulation in specific cases in which the national administrations intend to grant the requests for exemption which have been submitted to them. However, in this case, it is established that this was not so and that the Commission did not have to give a specific decision concerning the applicants' requests.

Moreover, we should observe in this respect that the problem was brought before the Commission not by the applicants but by the intervention of the president of the French association of sugar traders. The purpose of that intervention was not to invoke directly the liability of the Commission but to explain the damaging situation in which French exporters generally found themselves owing to the limitation of the benefit of Regulation No 1608/74 to contracts concluded before 15 March 1976. The association's letter asks the Commission to decide upon a ‘practical solution’ without raising any problem of general policy.

The reply given by letter from the Director General for Agriculture is merely in the nature of a notification and as such certainly does not constitute a legal measure which is capable of being contested before the Court.

My second observation is derived not only from the system set up by Regulation No 1608/74 but from the very arguments of the applicants which, by rejecting the concept of calling the legality of that provision directly in question, seem to reproach the Commission for a wrongful omission, a lacuna in the system of the regulation, on the ground that that regulation does not take into account all concrete cases in which a solution based on the principles of natural justice is necessary so as to prevent certain traden from suffering the disadvantages of the fluctuations in the national currency.

However this would be to raise the problem of the legality of the levying of the pan of the monetary compensatory amount which exceeds the rate applicable on the day on which the contraa is concluded.

This consideration prompts me to elucidate the true reason for dismissing the application as inadmissible.

This reason is fully supported in the case-law of the Court.

What is in fact involved? The imposition and collection of monetary compensatory amounts charged when an agricultural product is exported from a Member State to a third country.

These compensatory amounts are among the own resources of the Community within the meaning of the Council Decision of 21 April 1970, Article 6 of which provides that these resources shall be collected for the account of the Community ‘in accordance with national provisions imposed by law, regulation or administrative action’. Within the same meaning, Anides 1, 2 and 13 of Regulation No 2/71 of the Council, adopted in implementation of the abovementioned decision, specify, indeed, that the competent departments or agencies of the Member States shall be responsible for the establishment of the Community's own resources and control of the collection thereof.

As these regulations stand, the case-law of the Court, as follows first from the judgment of 25 October 1972, Haegemann v Commission, Case 96/71, has been laid down to the effect that ‘disputes concerning the levying on individuals of the charges and levies referred to by this provision must be resolved, applying Community law, by the national authorities and following the practices laid down by the law of the Member Sutes’.

This case has been confirmed by subsequent judgments from which it follows moreover that in the case of a charge, levy or compensatory amount it is not so much the fact of constituting or not constituting an own resource of the Community which justifies the power of the national authorities in legal proceedings for the collection thereof but the fact that they are collected by the competent agencies of the Member States and in accordance with the national provisions imposed by law or regulation.

As this Court recalled in a judgment of 27 January 1976 in Case 46/75, IBC (Importazione Bestiame Carni) s.r.l. v Commission of the European Communities, with reference to an application based on the alleged illegality of a regulation by which the Commission was said to have improperly reduced the compensatory amounts on importation, a regulation which was applied by the Italian customs authorities:

‘2. It is claimed that as a result of the application of this provision the applicant was wrongly required to pay certain sums by way of equalization between the impon charge and the monetary compensatory amounts; it is the repayment of these sums which is sought in this action.

3. The action in fact concerns decisions of the Iulian authorities adopted in implementation of Community rules which the applicant regards as unlawful. It thus concerns the legality of the imposition of the sums in dispute by the natianal authorities responsible for the implementation and enforcement of the provisions concerning monetary compensatory amounts and seeks the reimbursement, by the Community rather than by the national authorities, of the sums which are said to have been improperly charged.

4. The provisions of these rules lay down criteria for the calculation of sums payable by way of equalization between the impon charge and the compensatory amounts and therefore leave no doubt that the actual assessment and imposition of the sums due are matters for the national authorities.

5. The question of the legality of such implementing measures adopted in pursuance of Community law is, therefore, a matter for the competent national courts or Tribunals to decide, using the procedures laid down under national law and after application, where appropriate, of Article 177 of the Treaty, in particular on questions concerning the validity of the Community provisions applied.

6. The applicant is not therefore entitled to refer the matter to the Court of Justice by the expedient of an action directed against the Community for compensation for the alleged damage in order to obtain a material revision of the said implementing measures.’

The facts in the present cases are wholly comparable. What the applicants are in fact contesting is the imposition by the competent French administration of the pan of the monetary compensatory amounts which exceeds the rate of those charges which was valid on the day on which their contracts were concluded.

The decisions to refuse exemption which were applied to them by the Fund constitute national measures in implementation of Regulation No 1608/74. It was therefore for the applicants to contest those decisions before the national courts having jurisdiction in accordance with the forms and within the periods laid down by French law even if it entailed, if necessary, requesting the court before which the case was brought to refer to the Court of Justice one or several questions for a preliminary ruling on the interpretation of the Community regulation in question, or its validity.

But they could not validly bring the case before the Court of Justice by the expedient of an action based on the non-contractual liability of the Community so as to obtain the annulment of the national measures adopted in implementation of that regulation.

I therefore conclude that Applications Nos 12, 18 and 21/77 should be dismissed as inadmissible and that the applicant companies should be ordered to bear the costs.

( 1 ) Translated from the French