5.

I now turn to Regulation No 804/68. According to the plaintiff undertakings, there are in particular three groups of national rules which are contrary to that regulation, namely the rules which restrict production to certain types of cheese, those which lay down rigid requirements for the qualitative features of those types, and those which regulate the process of maturation, packaging and transport, by the imposition of other far-reaching restrictions on the freedom of Netherlands producers and traders. I shall deal presently with those provisions of the legislation in question. Before I analyse them it is appropriate to point out — and the usefulness of this explanation will subsequently become apparent — that they do not relate to cheese imported from other Member States. That is expressly stated by Article 2 (4) of the Royal Decree of 1981 which provides that the prohibition of production and marketing “shall not apply to products subject to customs arrangements” under the general law on customs and excise, provided that such products are not “subject to the inward processing procedure referred to in the Council Directive ... of 4 March 1969, No 69/73/EEC ... as amended in the past or in the future”. To return to the plaintiff's complaints, the facts to which they refer are incontestable. Article 6 of the Royal Decree and the corresponding provisions of its implementing decree prohibit the production of cheeses which could be manufactured lawfully until 1981. That applies to diet cheese with a low salt content, Gouda with the large holes typical of the Emmental variety and “brosse Kaas”. Hence that measure is highly detrimental to Netherlands undertakings which, since they are forbidden to produce cheeses which other Member States are free to manufacture (for example, the Italian types produced in Belgium), cannot expand by marketing products for which there is a demand on the part of consumers. Furthermore, the prohibition of the production of certain types of cheese is accompanied by the prohibition of even a slight variation of the composition and process of production of the permitted types of cheese. Thus, in the case of Cheddar, in the Netherlands its moisture content may not exceed 38%, whilst in the United Kingdom it may be as high as 39%. That leads to an increase in costs for the Netherlands producer whose own Cheddar must have a 1% higher fat content. Finally, there are the requirements relating to maturation and transport. By requiring that cheese remain within Netherlands territory until it is mature, Article 64 of the Ministerial Order of 28 December 1981 prevents, once again to the detriment of the cheese manufacturers, its speedy dispatch to other Member States and its prompt marketing there. Thus, there are no doubts whatsoever as regards the impact or, to be quite candid, the “burdensome nature” of the system. But is that sufficient to make the system incompatible with Community law? The plaintiffs are confident that it is. They would even have the Court believe that there is an absolute incompatibility by virtue of general legal principles. There are certain sectors — according to Counsel for the plaintiffs — in which the establishment of a common market and the endowment of the Community authorities with the means for implementing an integrated system have permanently deprived the Member States of any power to intervene. The chief example of this is provided by agricultural policy in general and the market in cheese products in particular. The Member States may not interfere, at any rate in sectors in respect of which Community rules have been adopted. I cannot endorse that argument, even in the less extreme version containing the reservation to which I have just referred. That is demonstrated precisely by those judgments which the plaintiffs rely upon in support of their argument. Thus, in its judgments of 18 May 1977 in Case 111/76 Van den Hazel [1977] ECR 901, 29 November 1978 in Case 83/78 Pigs Marketing Board [1978] ECR 2347 and 26 June 1979 in Case 177/78 Pigs and Bacon Commission ν McCarren [1979] ECR 2161, the Court held that where the Community has, pursuant to Article 40, legislated for the establishment of the common organization of the market in a given sector, Member States are under an obligation to refrain from taking any measure which might undermine or create exceptions to it. In other words, it is not true that the national authorities are prohibited from taking any steps for the regulation of a market where the Community authorities have already made provision for it. The reverse is true, that is to say they may intervene provided that they pursue a policy which is not contrary to rules adopted by the Community authorities. The attitude of the Commission is more flexible. The argument put forward by its representative, which is not entirely free from ambiguity, may be summarized as follows: the objectives of Article 39 must be pursued by the instruments of agricultural policy provided for by the Treaty. Accordingly the Member States may not — except in wholly exceptional circumstances and subject to stringent conditions, as provided for by Article 43 (3) — unilaterally set up a market organization in one sector or another. From that point of view the Netherlands legislation cannot be challenged. Not even its harshest critic would be able to maintain that the Netherlands has created a genuine organization of the market in cheese products or, in other words, that the Netherlands authorites have displaced the Community authorities in a sector for which the latter have exclusive responsibility. I believe that the premise of that argument is correct. To confer upon the Member States the power to establish organizations of the market where Community measures pursuing the same objective are in force would serve no purpose. But to assume that a State would go so far as to adopt legislation which would be entirely superimposed on the Community measures is unrealistic. In reality, the position is different as has been shown more than once. A State may adopt measures which are far-reaching in scope, but without going so far as to create a genuine organization of the market. The question of their legality therefore depends entirely on how the phrase “without going so far” is construed. How far can a Member State go and where is the line to be drawn? Those arc in my opinion the real questions raised by the Netherlands legislation at issue.