I —

The first two questions by the court making the reference are concerned with the compatibility with Community rules of measures of the kind adopted by the Italian Government. 1. It must first of all be remembered that in view of the disturbances in the summer of 1973 on the common market and in particular on the Italian market the Community authorities did not remain inactive. Although the common organizations of the market were designed to deal with surpluses, the Community authorities are not nevertheless incapable of acting if they are confronted with a shortage. They first of all used the normal means provided for dealing with market disturbances (Regulation No 2591/69 of the Council of 18 December 1969, OJ, English Special Edition, 1969 (II), p. 571; Regulation No 1968/73 of the Council of 19 July 1973, OJ 1973, L 201, p. 10) such as suspension of the refunds fixed previously, reduction of the period of validity of the export licences as well as cancellation of any refund. From 1 August 1973 the German, French and Belgian intervention agencies pursuant to Regulation No 2104/73 (OJ L 214 of 2. 8. 1973, p. 2), with the financial support of the Community, placed at the disposal of the AIMA, upon special conditions, 200000 metric tons of soft wheat intended solely for the manufacture of foodstuffs to be supplied to the population concerned. This wheat was then sold through open invitations to tender at the intervention price plus 1-5 u.a. Then at the request of the French Republic the Commission adopted on 4 August 1973 protective measures applicable to durum wheat exported outside the Community (OJ L 210 of 7. 8. 1973, p. 25). With effect from this date no more export licences were granted for this product. On 14 August 1973 the Commission fixed by Regulation No 2219/73 the levies to be paid for the export of soft wheat (OJ L 227 15 August 1973, p. 19). In addition, at the request of the Italian Republic the Commission on 29 August 1973 issued protective measures applicable to durum wheat flour, groats and meal from durum wheat exported from Italy (OJ L 243 of 31. 8. 1973, p. 44): with effect from this date no more licences from Italy were granted in respect of exports from Italy. The following recital in the latter regulation is particularly instructive. ‘Whereas these processed products (of durum wheat) are used (in particular in Italy) in the manufacture of pasta products (macaroni, spaghetti and similar products) for human consumption … Whereas, furthermore, the difference between prices ruling in Italy and prices ruling on the world market is still such as to encourage the export of durum wheat flour, groats and meal from Italy’ Finally, again at the request of the Italian Republic, the Commission issued on 20 September 1973 safeguard measures for the export of soft wheat, meal, flour and groats of Italian origin out of the Community. After this date no more export licences were granted in respect of any of these products in so far as they originated in Italy. After conditions on the world market had become more normal again an import levy was reintroduced. The safeguard measures relating to the export of soft wheat, meal, flour and groats were repealed with effect from 26 November 1974 (Commission Decision of 26 November 1974, OJ L 343 of 21. 12. 1974, p. 11). Finally the safeguard measures relating to the export of durum wheat orignating in the Community and also durum wheat meals, flour and groats of Italian origin were repealed with effect from 9 April 1975 (Commission Decision of 9 April 1975, OJ L 89 of 10. 4. 1975, p. 28). To sum up it may be said that, if the Commission has always refused expressly to grant a subsidy for the import of durum wheat into Italy and was no less firm in its refusal to introduce a countervailing charge requested by the French processing industry, the reason was that in its view the common organization of the market in cereals provides a complete system of protective measures which offers an effective way of dealing with disturbances of the market and also because it believed that it had exhausted all the available methods of intervening provided for by the Community rules. 2. The Italian Government took the view that this parcel of measures was insufficient; during the whole of this period, that is to say, from autumn 1973 to spring 1975, it therefore reinforced the Community measures with national measures. Since it could not be ruled out — at any rate in theory — that sales of durum wheat at a reduced price through the AIMA were likely to affect the volume and price of exports of Italian pasta products to the other Member States, the Italian Government also adopted certain measures to prevent the quantities sold by the AIMA at reduced prices from being used for purposes other than manufacture of pasta products for the home market. The problem was discussed several times by the Management Committee for Cereals, and in particular in 9 October 1973 during a meeting of the Special Committee on Agriculture, and the Commission also engaged in cooperation with the competent departments of the Italian Government in a thorough examination of the problem. After the Italian Government at the beginning of 1975 decided to stop sales of durum wheat at reduced prices to Italian manufacturers of pasta products the Commission appears to have shelved the matter but ‘left open the question of what view it would take of each of such new measures adopted by the Italian Government’ (answer of 28 July 1975 to written question No 170/75 of Mr de Keersmaeker of 6 June 1975). I should like to make the following observations on the interpretation which is requested of the Court. According to a well-established line of cases, of which the judgment of the Court of 23 January 1975 in the case of Galli ([1975] ECR 47) is only a continuation, Member States can no longer intervene in sectors where there is a common organization of the market by adopting unilateral provisions which are an unnecessary repetition of Community rules or even run counter to them. This applies to the producer and trade prices of durum wheat and durum wheat meal. The AIMA's selling price was not only below the Italian market price and the Community target price, which moreover only had a theoretical importance, but also below the intervention price. Although the selling price for durum wheat in the possession of the Italian intervention agency had to correspond to the price on the nearest local market and could in no circumstances be lower than the intervention price applying on this market (Article 3 of the Regulation of the Commission of 27 February 1970, OJ L 47 of 28. 2. 1970, p. 49), the AIMA's selling price was much lower than this minimum price, which amounted in December 1974 to Lit. 591 plus a monthly increase of Lit 383. In fact the AIMA, by abandoning the role assigned to it under the Community rules destroyed the market, just like a private undertaking, by what can only be described as dumping. The whole purpose of the Italian rules was to make durum wheat available to consumers at a price lower than the price resulting from normal market forces. By altering the structure of the selling price of the product in question it interfered directly with the Community rules. Had it not been for this intervention there might have been someone prepared to buy Mr Russo's durum wheat at more than Lit. 17000 per 100 kg. The common organization of the market in durum wheat, which is provided for by Article 40 (2) of the Treaty and was established by Regulation No 120/67, empowers the Community institutions entrusted with the task of running it to adopt the necessary measures to deal with price rises on the Italian market and we have seen that these powers have been exercised by them. These powers override any concurrent powers vested in the Member, States. If concurrent powers of the kind at issue in this case were permitted, that would be tantamount to retaining or reviving an national organization of the market, which by definition has been replaced by a common organization (Article 43 (3) of the Treaty). Having regard to the interpretation which has been requested it is not necessary to compare the AIMA's measures with the provisions relating to aids (Article 92 to 94 of the Treaty). All that need be done is to point out that they amount to a direct intervention on the durum wheat market which was intended to alter and in fact succeeded in altering price formation in a system of competition, which it was the aim of the Treaty to protect.