1.

The first question raised by both cases concerns the concept “charge having an effect equivalent to a customs duty”. It is to be defined in relation to the surcharge which is also imposed on imported sugar, whose place within the system has been described above. Further factors to be borne in mind, as appears from Case 77/76, ate that the revenue from the surcharge benefits solely the sugar industry and the producers of sugar-beet within the territory of the Member State imposing the charge, that it is a part of a system of subsidies for which special provisions of Community law are applicable and that it has not been approved by Community bodies and has not been introduced in compliance with the procedure under Article 41 of Regulation No 1009/67/EEC or Article 36 of Regulation (EEC) No 3330/74. The surcharge is imposed equally on imported sugar and home-produced sugar. For that reason it is appropriate to examine the rules in the light of Article 95 of the EEC Treaty which provides: “No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products”. Although the courts making the orders for reference also conceived of application of Article 13 of the EEC Treaty and the corresponding provisions relating to the common organization of markets concerning the prohibition of the imposition of charges having an effect equivalent to customs duties, that is, the application of a provision which, it is clear from the decided cases (cf. for example judgment of 18 June 1975 in Case 94/74, Industria Gomma Articoli Vari (IGAV) v Ente Nazionale per la Cellulosa e per la Carta (ENCC) [1975] ECR 699 et seq.), cannot be applied in conjunction with Article 95, the courts were referring to two earlier judgments which concerned a comparable rule and which in this respect made mention of a possible application of Article 13 (2) of the EEC Treaty. That case concerned the Italian Ente Nazionale per la Cellulosa e per la Carta and the related rules concerning levies and subsidies. With regard to those measures whereby levies are imposed on paper and similar products, the revenue from which finances certain activities concerning research and development in the paper and cellulose production sector and subsidies for newsprint, it was stated in a judgment of 19 June 1973 (Case 77/72, Carmine Capolongo v Azienda Agricola Maya [1973] ECR 623) that in interpreting the term “charges having an effect equivalent to customs duties on imports” it may be appropriate to take account of the destination of the charges imposed. Accordingly application thereof might be conceivable if the financial charge is intended exclusively to “support activities which specifically benefit the taxed domestic product …” that is to say, if it appears that for domestic products the charge “constitutes in reality a set-off against benefits or aids previously received”. In a second judgment which is relevant to the present circumstances, delivered on 18 June 1975 concerning the same problem (Case 94/74, Industria Gomma Articoli Vari (IGAV) v Ente Nazionale per la Cellulosa e per la Carta (ENCC) [1975] ECR 699 at p. 710), it was stated that application of Article 13 of the EEC Treaty was conceivable if such a duty which was limited to particular products “had the sole purpose of financing activities for the specific advantage of the taxed domestic products, so as to make good, wholly or in part, the fiscal charge imposed upon them”. It was also stressed in that judgment that such a definition would imply a clearly established connexion “between, on the one hand, the collection of a fiscal duty levied without distinction on the products in question, whether domestic or imported and, on the other hand, the advantage which enures only for the benefit of the domestic products by reason of the proceeds of that same duty”. In the forefront of the present issue there is raised therefore the question of the exact scope of the decided cases and whether they should be defined more narrowly or whether further extension is even possible. Those parties to the proceedings which support the view that the surcharge should be regarded as a charge having an effect equivalent to a customs duty relied in particular on the fact that pursuant to the latter judgment it is sufficient if the domestic products subject to the charge are accorded partial relief by the granting of benefits from the revenue of the charge. In this respect it is relevant that the total charge imposed on home-produced sugar was obviously considerably greater than the amounts granted to the Italian sugar industry directly as subsidies. In addition those who took that view argued that the assistance provided from the revenue from the charges to the sugar-beet growers should be taken into account. This is supported, they claim, not only by the fact that sugar and sugar-beet are covered by a common organization of the market, but it may also be accepted that the aids to the sugar-beet growers directly benefit the sugar industry namely by making the final product less expensive and by the fact that domestic sugar-beet production is increased by means of the aids. They state that in view of this it is even evident that because the total revenue from the surcharge is greater than the charges borne by the domestic sugar industry there exists additional aid and not merely a compensation for the charge. Against this stands the view which is advocated by the Commission and the Italian Government. They argue that the judgments referred to above should be restrictively interpreted and in particular that the view that partial relief of the domestic product is sufficient should be dismissed. In their opinion application of Article 13 is only possible if the revenue from a charge benefits the domestic product exclusively and directly and if in addition by this means the domestic products obtain complete relief with the result that the imported products alone are subject to the charge. Faced with this dispute and the respective arguments, I would suggest that the Court of Justice clarifies the decided cases even to the extent of restricting them in accordance with the sense advocated by the Commission. This is supported on the one hand by the requirement of clarity of concepts which is particularly important in relation to fundamental provisions relating to the customs union which may be directly applicable. It is only in this way that the considerable difficulties relating to practical application which the Commission has referred to in detail can be avoided. It is further supported by the fact that it in fact appears appropriate to include borderline cases of parafiscal rules under the abovementioned Article 95 in particular because that provision is directly applicable as was once again emphasized in the judgment in Case 74/76 (Jannelli & Volpi S.p.A., Milan, v Ditta Paolo Meroni, Milan, Judgment of 22 March 1977). For the term “charges having an effect equivalent to customs duties”, in so far as the destination of the charge is relevant, the decisive factor should be that the domestic products bearing the charge and those receiving the benefit should be identical. Moreover the judgment in Case 94/74 apparently refers to this in mentioning activities for the specific advantage of the taxed domestic products which no doubt excludes indirect benefits through the raw materials used. It is also supported by the judgment of 17 February 1976 in Case 45/75 (REWE-Zentrale des Lebensmittel-Großhandels GmbH v Hauptzollamt Landau/Pfalz [1976] ECR at p. 194) where the judgment emphasizes in respect of Article 95 that comparison must be made between the taxation imposed on products “which, at the same stage of production or marketing, have similar characteristics and meet the same needs from the point of view of consumers”. Accordingly in the present case the benefit granted to sugar-beet growers should not be taken into consideration. A not inconsiderable factor in this decision is that the price system applicable to sugar-beet and the conflict of interests between the sugar-beet growers and the sugar industry make it very doubtful whether the benefit to the sugar-beet growers has any effect on the production costs of the sugar industry and that other indirect effects such as the maintenance and expansion of beet-growing in the vicinity of the processing industry can only be defined so imprecisely that they can certainly not enter into consideration as regards Article 13. In addition emphasis should be placed on the fact that Article 13 is only applicable if the taxed domestic products are benefited to such an extent that they receive total relief. This was stated by Mr Advocate-General Trabucchi in his opinion in Case 94/74 with the convincing argument that Article 13 only applies to circumstances such as the present in a case involving a substantial evasion of the law (‘sostanziale frode alla legge’). This is also supported by the passage in the judgment in Case 77/72 which states that the prohibition contained in Article 13 is aimed at any tax which is imposed specifically on an imported product to the exclusion of the similar domestic product. Moreover it is only in this way that a lack of conceptual clarity and difficulties of definition with regard to Article 95 can be avoided. Accordingly it seems clear to me that the first question can only be answered in the sense proposed by the Commission, that is to say, that a charge which is imposed on home-produced and imported goods according to the same criteria can only be regarded as a charge having an effect equivalent to a customs duty within the meaning of Article 13 of the EEC Treaty if the revenue from the charge solely benefits the taxed domestic products, if the domestic products bearing the charge and receiving the benefit are identical and if the benefits granted to the domestic products entail complete relief from the charge. From this it will perhaps also be clear — though this conclusion should of course be drawn by the national courts — that the surcharge imposed by the CIP cannot be regarded as a charge having an effect equivalent to a customs duty. This may be said because the revenue from the charge is not used solely for the national sugar industry but to a large extent is also used for sugar-beet production quite apart from the the fact that under the basic system its use for other purposes is not excluded. In addition there does not appear to exist total relief for home-produced sugar by means of the subsidies granted to the sugar industry; according to the figures produced in the course of the proceedings the charge borne by domestic sugar was Lit 75 milliard as against a total amount of subsidies of merely Lit 28 milliard.