Opinion of Mr Advocate General Elmer delivered on 15 October 1996. - Kingdom of Belgium and Federal Republic of Germany v Commission of the European Communities. - Bananas - Common organization of the markets - Natural disaster - Import quota - Adjustment and allocation. - Joined cases C-9/95, C-23/95 and C-156/95.



European Court reports 1997 Page I-00645



Opinion of the Advocate-General

1 By Article 1(2) and Article 2 of Commission Regulations (EC) No 2791/94 (1) and No 510/95 (2) (`the Debbie regulations'), licences to import a total of 98 900 tonnes of third-country and non-traditional ACP (3) bananas were allocated to operators who include or directly represent banana producers from Community States and ACP States whose banana production suffered the effects of tropical storm Debbie.

2 In the present case, the Kingdom of Belgium and the Federal Republic of Germany seek the annulment of the abovementioned regulations on the grounds, in particular, that Council Regulation (EEC) No 404/93 of 13 February 1993 on the common organization of the market in bananas (4) (hereinafter `the basic regulation') did not provide an adequate legal basis for the Commission to adopt the abovementioned provisions of the Debbie regulations.

The relevant legal provisions and the facts

3 Before the basic regulation entered into force on 1 July 1993, there were various national market organizations in the Member States. Those arrangements may be divided into two groups. In the first group, which included France, Spain and the United Kingdom, domestic production and ACP production occupied a privileged position, whereas in the other group, which included Germany, Belgium and the Netherlands, the organization of the market was open, in the sense that it was possible to import bananas from Latin America without any quantitative restriction. (5)

4 The basic regulation is based on the Treaty, in particular Articles 42 and 43 relating to the implementation of the broad lines of a common agricultural policy which, according to Article 39(1), aims, inter alia,

`...

(b) ... to ensure a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture;

(c) to stabilize markets;

(d) to assure the availability of supplies;

(e) to ensure that supplies reach consumers at reasonable prices'.

5 The preamble to the basic regulation includes the following recitals:

`Whereas, so that the Community can respect Community Preference and its various international obligations, that common organization of the market should permit bananas produced in the Community and those from the ACP States which are traditional suppliers to be disposed of on the Community market providing an adequate income for producers and at fair prices for consumers without undermining imports of bananas from other third countries suppliers; (third recital)

Whereas a forecast supply balance drawn up each year should assess the prospects for production and consumption in the Community; whereas it should be possible to revise that balance during the year in the light of circumstances, including specific climatic events; (ninth recital)

Whereas in order to ensure satisfactory marketing of bananas produced within the Community and of products originating in the ACP States within the framework of the Lomé Convention Agreements, while maintaining traditional trade patterns as far as possible, provision should be made for the annual opening of a tariff quota; whereas, on the one hand, imports of bananas from third countries would be subject to a tariff of ECU 100 per tonne, (6) which corresponds to the current rate under the Common Customs Tariff, and, on the other hand, imports of non-traditional bananas from the ACP would be subject to zero duty in accordance with the abovementioned agreements; whereas provision should be made in order to ensure the adaptation of the amount of the tariff quota based on changes in Community demand recorded in the forecast supply balance; (tenth recital)

Whereas imports not falling within the tariff quota must be subject to sufficiently high rates of duty to ensure that Community production and traditional ACP quantities are disposed of in acceptable conditions; (7) (eleventh recital)

Whereas, in order not to disrupt existing commercial links, while at the same time allowing some development of marketing structures, the issue to each operator of separate import licences for each of the categories defined above must be on the basis of the average quantity of bananas marketed by the operator over the three preceding years for which statistical data are available' (fourteenth recital).

6 Title III of the basic regulation contains provisions relating to compensatory aid for Community producers. According to Article 12(2), the maximum quantity of bananas produced and marketed in the Community for which compensation may be paid is fixed at 854 000 tonnes (net weight). That quantity is broken down as follows for each producer region in the Community:

(1) 420 000 tonnes for the Canary Islands,

(2) 150 000 tonnes for Guadeloupe,

(3) 219 000 tonnes for Martinique,

(4) 50 000 tonnes for Madeira, the Azores and the Algarve,

(5) 15 000 tonnes for Crete and Lakonia.

Compensation is calculated on the basis of the difference between a flat-rate reference income and the average production income obtained during the year in question.

7 Title IV lays down the rules governing trade with third countries. Article 15 (Article 15a after the amendment introduced by Regulation No 3290/94) defines `traditional ACP bananas' by reference to the quantities allocated to certain ACP States as set out in the annex to the regulation. It emerges therefrom that the total quantity allocated in that context is 857 700 tonnes, of which 127 000 tonnes for Saint Lucia and 71 000 tonnes for Dominica. `Non-traditional ACP bananas' are imports from an ACP State which exceed the quantity defined in the annex to the regulation for the country in question or imports from ACP States not listed in the annex. `Third-country bananas' are defined as imports of third countries other than ACP States, which in practice means Latin American producer countries.

8 The basic regulation contains, furthermore, the following relevant provisions:

`Article 16

1. Each year, a forecast supply balance shall be prepared on production and consumption in the Community and of imports and exports.

2. The forecast supply balance shall be prepared on the basis of:

- available figures concerning quantities of bananas marketed in the Community during the previous year, broken down according to their origin,

- forecasts of the production and marketing of Community bananas,

- forecasts of imports of traditional ACP bananas,

- forecasts of consumption based in particular on recent trends in consumption and the evolution in market prices.

3. Where necessary, in particular to take account of the effects of exceptional circumstances affecting production or import conditions, the balance may be adjusted during the marketing year. In such a case, the tariff quota provided for in Article 18 shall be adapted in accordance with the procedure laid down in Article 27.

...

Article 18

1. A tariff quota of 2.2 million tonnes (8) (net weight) shall be opened each year for imports of third-country bananas and non-traditional ACP bananas.

...

Where Community demand determined on the basis of the supply balance referred to in Article 16 increases, the volume of the quota shall be increased in consequence, in accordance with the procedure laid down in Article 27. Where necessary, that adjustment shall be carried out prior to the date of 30 November preceding the marketing year concerned.

...

Article 19

1. The tariff quota shall be opened from 1 July 1993 for:

(a) 66.5% to the category of operators who marketed third-country and/or non-traditional ACP bananas;

(b) 30% to the category of operators who marketed Community and/or traditional ACP bananas;

(c) 3.5% to the category of operators established in the Community who started marketing bananas other than Community and/or traditional ACP bananas from 1992.

...

2. On the basis of separate calculations for each of the categories of operators referred to in paragraph 1(a) and (b), each operator shall obtain import licences on the basis of the average quantities of bananas that he has sold in the three most recent years for which figures are available. For the category of operators referred to in paragraph 1(a), the quantities to be taken into consideration shall be the sales of third-country and/or non-traditional ACP bananas. In the case of operators referred to in paragraph 1(b), sales of traditional ACP and/or Community bananas are to be taken into consideration ...

...

4. If the tariff quota is increased, the additional available quantity shall be allocated to importers in the categories referred to in paragraph 1 in accordance with the preceding paragraphs.

Article 20

In accordance with the procedure laid down in Article 27, the Commission shall adopt and adjust the forecast supply balance referred to in Article 16.

In accordance with the same procedure, the Commission shall adopt detailed rules for implementing this Title. Those rules may cover in particular:

- additional measures concerning the issue of licences, their term of validity, the conditions governing transferability and the requisite security mechanism; those rules may also include determination of a reconsideration period,

- frequency of issue of licences,

- the minimum quantity of bananas marketed as referred to in the second subparagraph of Article 19(1),

- measures guaranteeing the provenance and origin of bananas imported within the tariff quota provided for in Article 18(1),

- measures necessary to fulfil obligations arising from agreements concluded by the Community in accordance with Article 288 of the Treaty.

TITLE V General provisions

...

Article 26

1. A Management Committee for Bananas (hereinafter called the "Committee") shall be established, consisting of representatives of the Member States and chaired by a representative of the Commission.

...

Article 27

1. Where reference is made to the procedure laid down in this Article, the Chairman shall refer the matter to the Committee either on his own initiative or at the request of the representative of a Member State.

2. The representative of the Commission shall submit a draft of the measures to be taken. The Committee shall deliver its opinion on such measures within a time limit to be set by the Chairman according to the urgency of the questions under consideration. An opinion shall be adopted by the majority laid down in Article 148(2) of the Treaty.

3. The Commission shall adopt measures which shall apply immediately. However, if these measures are not in accordance with the opinion of the Committee, they shall forthwith be communicated by the Commission to the Council. In that event, the Commission may defer application of the measures which it has adopted for not more than one month from the date of such communication.

The Council, acting by a qualified majority, may take a different decision within one month.

... Article 30

If specific measures are required after July 1993 to assist the transition from arrangements existing before the entry into force of this Regulation to those laid down by this Regulation, and in particular to overcome difficulties of a sensitive nature, the Commission, acting in accordance with the procedure laid down in Article 27, shall take any transitional measures it judges necessary.'

9 Commission Regulation (EEC) No 1442/93 of 10 June 1993 laying down detailed rules for the application of the arrangements for importing bananas into the Community (9) laid down detailed rules for the application of the arrangements for importation in the context of the tariff quota and of the rules for importing traditional bananas from ACP States.

10 According to Commission Decision 94/654/EC of 29 September 1994 adopting the forecast supply balance for banana production, consumption, imports and exports for the Community for 1994, (10) each year, a forecast supply balance is to be prepared pursuant to Article 16 of the basic regulation, the main purpose of which is to establish the outlook for Community production and consumption and the forecasts for imports of traditional ACP bananas, and hence the supply requirements for the Community market and the requisite tariff quota; that decision goes on to say that, as a result of tropical storm Debbie, the supply balance should be reviewed as soon as possible in accordance with Article 16(3) of the basic regulation, although the review can only take place on the basis of a final assessment of the situation, which is not yet available. According to the annex to the decision in question, EC production is set at 643 000 tonnes, traditional ACP imports at 666 000 tonnes and the tariff quota at 2 118 000 tonnes.

11 On 16 November 1994 the Commission, acting pursuant to the basic regulation, in particular Articles 16(3), 20 and 30, adopted the first Debbie regulation, whose preamble includes the following recitals:

`Whereas on 10 September 1994 tropical storm Debbie caused severe damage to the banana plantations in the Community regions of Martinique and Guadeloupe and in the ACP States of Saint Lucia and Dominica; whereas the effects of these exceptional circumstances on production in the regions affected will be felt until July 1995 and will greatly affect imports and supplies to the Community markets during the fourth quarter of 1994; whereas this is likely to cause an appreciable increase in market prices in certain regions of the Community; (second recital)

Whereas Article 16(3) of Regulation (EEC) No 404/93 stipulates that where necessary, in particular to take account of the effects of exceptional circumstances affecting production or import conditions, the forecast supply balance may be adjusted and, in such a case, the tariff quota is adapted; (third recital)

Whereas the adaptation of the tariff quota must permit adequate supplies to the Community market up to the end of 1994 and provide compensation to operators who include or directly represent banana producers who suffered damage and who, in addition, in the absence of appropriate measures, risk losing their traditional outlets on the Community market on a long-term basis; (fourth recital)

Whereas the measures to be taken should have a specific transitional nature, within the meaning of Article 30 of Regulation (EEC) No 404/93; whereas, prior to the entry into force of the new common market organization on 1 July 1993, existing national market organizations, in order to cope with urgent cases or exceptional circumstances such as tropical storm Debbie, included provisions ensuring supplies to the market from other suppliers while safeguarding the interests of operators who are victims of such exceptional events; (fifth recital)

... whereas the measures should include the granting of the right to import in compensation third-country bananas and non-traditional ACP bananas for the benefit of the operators who directly suffered damage as a result of the impossibility of supplying the Community market with bananas originating in affected producer regions; whereas, in addition, provision should be made for the quantities marketed on the Community market pursuant to this measure to be taken into consideration, in due course, for determining the reference quantities for the operators concerned for the tariff quotas for future years; whereas these measures should be to the benefit of the operators who have directly suffered actual damage, without the possibility of compensation, and as a function of the extent of the damage' (seventh recital).

Under Article 1(1), the tariff quota for 1994 is increased by 53 400 tonnes, from 2 118 000 tonnes to 2 171 400 tonnes. The additional quantity is allocated, under Article 1(2), to operators supplying the Community with bananas produced in Martinique (30 000 tonnes), Guadeloupe (5 900 tonnes), Saint Lucia (14 800 tonnes) and Dominica (2 700 tonnes).

According to Article 2(1), the quantities referred to in Article 1(2) are to be allocated to the operators who:

`- include or directly represent banana producers affected by tropical storm Debbie,

- and who, during the last quarter of 1994, are unable to supply, on their own account, the Community market with bananas originating in the regions or countries referred to in Article 1(2) on account of the damage caused by tropical storm Debbie'.

12 On 18 November 1994 the Commission adjusted the forecast supply balance for 1994 in line with the findings made in the first Debbie regulation. (11) The forecasts for Community production and the importation of traditional ACP bananas were therefore set at 607 100 and 648 500 tonnes respectively.

13 Regulation No 3290/94 (12) introduced a number of amendments to the basic regulation in order to implement the obligations undertaken by the Community in the context of the Uruguay Round.

14 To supplement Regulation No 3290/94, the Commission adopted a number of additional implementing and amending provisions by means of Regulation (EC) No 478/95. (13) Under Article 1(1) of Regulation No 478/95, certain supplier countries enumerated in Annex I were allocated specific shares of the tariff quota. (14) The Dominican Republic, Belize, Côte d'Ivoire, Cameroon and the remaining ACP countries taken together were allocated a total quantity of 90 000 tonnes of non-traditional ACP bananas. According to Article 1(2), `where the tariff quota is increased in application of Article 18(1) of Regulation (EEC) No 404/93, the quantities allocated [to the countries referred to in Regulation No 478/95] shall be increased ...'.

It appears from Article 2(1) that, if, for reasons of force majeure, a supplier country is not able to export to the Community market all or part of the quantities allocated to it, it may supply products to the Community market originating in another country which has also been allocated a specific share.

15 Regulation No 510/95, (15) the second Debbie regulation, increased the tariff quota for 1995 by 45 000 tonnes, from 2 200 000 tonnes to 2 245 500 tonnes. The additional quantities were allocated to operators supplying the Community with bananas produced in Martinique (28 000 tonnes), Guadeloupe (3 600 tonnes) and Saint Lucia and Dominica (13 900 tonnes). The regulation, which applied during the first quarter of 1995, is otherwise identical to the first Debbie regulation.

16 On 6 April 1995, the Commission submitted a proposal for a regulation amending the basic regulation in which it expressly provided for the possibility of departing from the allocation rules laid down in Article 19, in order to cope with cases of force majeure. (16) The Commission's proposal has not yet been adopted.

Forms of order sought by the parties

17 By applications lodged on 16 January 1995 (Case C-9/95) and 2 February 1995 (Case C-23/95) respectively, the Kingdom of Belgium and the Federal Republic of Germany sought the annulment of Article 1(2) and Article 2 of the first Debbie regulation. By application lodged on 17 May 1995 (Case C-156/95), the Kingdom of Belgium further requested the annulment of Article 1(2) and Article 2 of the second Debbie regulation.

18 The Kingdom of Belgium and the Federal Republic of Germany claimed that neither Article 16(3) nor Article 20 nor Article 30 of the basic regulation on which the Debbie regulations are based provide the necessary legal basis. The German Government claimed, moreover, that the Debbie regulations did not contain an adequate statement of reasons.

19 The Commission, supported by the French Republic and the United Kingdom, contended that the applications should be dismissed.

Articles 20 and 16(3) of the basic regulation

20 The Belgian and German Governments claimed that Article 16(3) of the basic regulation does not afford a sufficient legal basis for departing from the allocation formula laid down by Article 19(4) and (1), according to which an increase in the tariff quota must be allocated at the rate of 66.5% to operators in category A, 30% to operators in category B and 3.5% to operators in category C. The fact that Article 16(3) uses the expression `adjusted' rather than `increased', as Articles 18 and 19 do, is due to the fact that there may be both increases and reductions. If the tariff quota is reduced, this is because allocation has already taken place. Consequently, there is no reason to mention reductions in Article 19(4). It is therefore not a matter of clarifying or supplementing the provisions of the basic regulation as set out in Article 20 thereof. The provision in Regulation No 478/95 which provides for a new allocation among the producer countries is irrelevant, since it does not result in any derogation from the allocation formula laid down in the basic regulation.

21 The Commission and the United Kingdom submit that the Debbie regulations are based on Articles 16(3) and 20 of the basic regulation. Article 19(4) of the basic regulation is concerned only with increases in the tariff quota as provided for in Article 18(1), which deals with increases in demand. Article 16(3) concerns a different situation, namely adjustment of the tariff quota on account of exceptional circumstances. The last mentioned provision allows the Commission to effect an allocation in the light of specific circumstances, in accordance with the committee procedure laid down in Article 27. If the quantities laid down in the Debbie regulations had been allocated in accordance with the allocation formula set out in Article 19(1) of the basic regulation, inequitable results would have ensued. The producers who sustained damage and the importers connected with them would have had no possibility of maintaining their deliveries and consequently their customary trading links by any means other than allocation of a designated quantity of third-country bananas and non-traditional ACP bananas. Moreover, those importers who did not suffer the effects of tropical storm Debbie would have been placed at an unfair advantage. Reduced imports and sales would have had an adverse impact on the reference quantities of the operators concerned, who would have been granted fewer import licences for third-country bananas for the following three years.

22 I shall begin my analysis by pointing out that the Court, most recently in its judgment in Case C-478/93 Netherlands v Commission, (17) has held that `[s]ince only the Commission is in a position to keep track of agricultural market trends and to act quickly when necessary, the Council may confer on it wide powers in that sphere. Consequently, the limits of those powers must be determined by reference amongst other things to the essential general aims of the market organization ... Thus, the Court has held that, in matters relating to agriculture, the Commission is authorized to adopt all the measures which are necessary or appropriate for the implementation of the basic legislation, provided that they are not contrary to such legislation or to the implementing legislation adopted by the Council ...'

23 Under Article 20 of the basic regulation, the Commission is authorized to adopt detailed rules concerning, in particular, the issue of import licences. As the phrase `in particular' makes clear, the Commission's powers are not however restricted to the issue of licences. It must therefore be determined whether it appears from the wording and the objective of the basic regulation that any increase in the tariff quota laid down by Article 18(1) must be allocated in accordance with the allocation formula provided for in Article 19(1) or whether the word `adapted' in Article 16(3) provides the Commission with a legal basis enabling it to allocate additional quantities under the tariff quota to certain operators as in the present case.

24 If third-country bananas, which are the most competitive, could be imported unrestrictedly, the sale of Community products and traditional ACP bananas would be made difficult. The basic regulation is therefore based on a quota system which distinguishes between three sources:

1. Community bananas,

2. traditional ACP bananas and

3. third-country and non-traditional ACP bananas.

25 The first two categories are in a privileged position with regard to the quantities mentioned above. First, compensatory aid for marketing is granted in respect of up to 854 000 tonnes of Community bananas and, secondly, up to 857 700 tonnes of ACP bananas (so-called `traditional ACP bananas') may be imported duty-free whilst the import licences may not be used for third-country bananas. Moreover, a tariff quota is opened each year for imports of third-country and non-traditional ACP bananas. Imports in excess of that quota are subject to a levy of ECU 750 per tonne of non-traditional ACP bananas and of ECU 850 per tonne of third-country bananas. The amount of the levy safeguards the competitiveness of Community bananas and traditional ACP bananas and, hence, the ability to market such bananas.

26 In order to guarantee equilibrium between total supply and consumption, a forecast supply balance has to be prepared each year pursuant to Article 16(1). The forecast supply balance constitutes the basis for the assessment provided for in Article 18(1) with a view to determining whether the tariff quota ought to be increased for third-country and non-traditional ACP bananas for the following year beyond the 2 million tonnes provided for. As Decision 94/654 makes clear, the main purpose of the supply balance is to establish the outlook for Community production and consumption and forecasts for imports of traditional ACP bananas, and hence the supply requirements for the Community market in terms of third-country and non-traditional ACP bananas and the requisite tariff quota.

27 The last subparagraph of Article 18(1) provides that, where Community demand determined on the basis of the supply balance referred to in Article 16 increases, the volume of the quota is to be increased in consequence, in accordance with the procedure laid down in Article 27. Where necessary, that change is to be carried out before 30 November in the year preceding the marketing year in question. Article 19(4) provides, moreover, that if the tariff quota is increased, the additional available quantity is to be allocated to importers in the categories referred to in paragraph 1 in accordance with paragraphs 2 and 3.

28 Article 16(3) provides that, where necessary, in particular to take account of the effects of exceptional circumstances affecting production or import conditions, the balance may be adjusted during the marketing year. In such a case, the tariff quota provided for in Article 18 is to be adapted in accordance with the management committee procedure laid down in Article 27.

29 The question therefore is whether it may be inferred from the term `adapted' that the other quantities of third-country and non-traditional ACP bananas which may be imported into the Community under the tariff quota on account of exceptional conditions must not be regarded as being increases having to be allocated in accordance with the rules laid down in Article 19(4).

30 The drafting of Articles 16(3), 18 and 19 of the basic regulation is unclear in several respects, which makes it difficult precisely to interpret them. Is the marketing year referred to in Article 18(1) the same as or different from a calendar year, bearing in mind that bananas are produced all year round, but particularly intensively in the periods October to December and February to March? (18) Is the expression `tariff quota' in Article 16(3) the same as the expression `volume of the tariff quota' used in the last subparagraph of Article 18(1) and does Article 19(1) and (4), which deals with the allocation of the `tariff quota', refer to one, both, or neither of those two provisions? Why does the basic regulation talk of a forecast supply balance and of an adjustment of that balance, whereas it appears from Commission Decisions 94/654 and 95/407 (19) that the accepted practice apparently is that the supply balance is drawn up at the end rather than at the beginning of the calendar year? Finally, the question arises whether Article 16(3) provides a basis for a downward adjustment of the abovementioned quantities where the tariff quota falls below 2 million tonnes or whether it may be inferred from Article 18(1) that that quantity is a fixed minimum and that the changes to which the forecast supply balance provided for in Article 16 may lead are invariably increases. In any event, Article 18(1) does not mention reducing the tariff quota in the context of the drawing up of the provisional supply forecast.

31 The fact that Article 16(3) uses the word `adapted' and not the word `increased', as in the case of Articles 18(1) and 19(4) ought, in my view, quite rightly to be able to be construed as reflecting the fact that Article 16(3) is an independent provision which does not necessarily have any connection with Articles 18(1) and 19. The two latter provisions are primarily tailored to what might be categorized as the normal situation in which it is to be expected when fixing the annual tariff quota that, as a result of well-known, normal market situations, a tariff quota of 2 million tonnes will not be sufficient to satisfy Community demand for third-country and non-traditional ACP bananas. In such case, any increase must, in accordance with Article 19(4), be carried out using the allocation formula laid down in Article 19. The fact that it is not the `volume of the tariff quota' which is increased, as provided for in Article 18(1), but rather the `quota' which is adapted in Article 16(3) and the fact that Article 18, which is related to Article 19, defines `quota' in such a way that it is the content of Articles 18 and 19 as a whole which may be `adapted' pursuant to Article 16(3), militate in favour of that interpretation.

32 On the other hand, according to its wording, Article 16(3) concerns any necessary adjustment of the forecast supply balance and the adaptation of the tariff quota. That provision is not restricted to exceptional circumstances, but could also refer to general changes in expected consumption and harvests attributable to general weather conditions. Under the basic regulation, demand and overall supply must coincide to the greatest extent possible. The wording of that paragraph accordingly covers a number of different situations, which, from the point of view of both demand and supply, may either be normal or exceptional. One thing, however, is certain. The effect of the system laid down by the regulation in question which makes provision for fixed quotas for each country for the purpose of providing aid to the Community production of bananas and the importation of traditional ACP bananas is that a reduction in the supply of Community and traditional ACP bananas must perforce result in an increase in the quantities of third-country and non-traditional ACP bananas.

33 Since Article 16(3) may thus be applicable to a number of different situations, it seems to me that it is possible to assume that the Community legislature intended to leave it to the Commission, applying an administrative committee procedure, to make the necessary adaptations in the light of actual circumstances. As I shall show below, such an interpretation is consistent both with the purpose of the regulation and with the Community principle of equal treatment, according to which the same rule must be applied to comparable situations and different situations should be treated differently. (20)

34 Allocation as provided for in Article 19 in fact makes sense in the event that Community consumption increases. Such an increase must accrue to all operators, which is ensured by applying the allocation formula provided in Article 19.

35 The situation is altogether different where, on the other hand, some operators suffer the consequences of exceptional circumstances. Each of the traditional ACP producer countries have been allocated a fixed quota. If a country is not able to attain its quota, it cannot make up the shortfall with third-country or non-traditional ACP bananas from another producer country. It may also be difficult for an operator who has lost his usual suppliers of Community bananas or traditional ACP bananas to replace them by other suppliers of Community or traditional ACP bananas. Since all Community and traditional ACP bananas may be marketed unrestrictedly, it is reasonable to consider that a producer of such bananas will give preference to his traditional distribution channels before making exceptional deliveries to an operator faced with exceptional circumstances who is linked to a competing producer. In the circumstances, therefore, operators who have suffered damage will have to procure third-country and non-traditional ACP bananas. They will be unable to do so, however, unless they can obtain import licences which correspond to their losses.

36 If, as a result of exceptional circumstances, an additional volume of the quota had to be allocated in accordance with the allocation formula set out in Article 19, the operators who had suffered damage could have allocated to them only a small percentage of the additional total quantity, with the result that they would be ousted from the market by other operators who had not suffered any damage and who, in the circumstances, would obtain an additional volume of the quota solely by reason of exceptional circumstances which did not affect them at all. The damage to the economic operators who suffered it would, however, not be confined to the year in which the natural disaster took place. Those operators would also receive fewer import licences in the following three years, since the allocation of import licences for third-country and non-traditional ACP bananas is carried out, pursuant to Article 19(2) of the basic regulation, on the basis of the average quantities of Community and traditional ACP bananas sold over the current three-year period.

37 Conversely, if the allocation formula provided for in Article 19 of the basic regulation were applied to cases of exceptional circumstances, the result would be that the importers of third-country bananas and non-traditional ACP bananas who had not themselves been affected by those exceptional circumstances would reap an unexpected advantage at the expense of the EC and ACP producers who had suffered losses entirely by chance as a result of a natural disaster against which they had no possibility of taking precautions.

38 The unacceptable nature of such an outcome is underscored by the fact that Council Regulation No 3290/94 and Commission Regulation No 478/95 provide a legal basis the purpose of which is to enable third-country producer States having a specific national quota which have suffered damage by reason of force majeure to supplement that quota with bananas produced in the other third countries to which a national quota has also been allocated. EC and ACP producers who have suffered damage by reason of force majeure and have no other option but to replace the crop which they have lost by third-country and non-traditional ACP bananas could not do so if the interpretation of the Kingdom of Belgium and the Federal Republic of Germany were to be followed. Under that interpretation, such situations, where the quota provided for cannot be supplied from own production as a result of exceptional circumstances, would be treated differently.

39 What I have just said may be specified in more concrete terms by means of an example based on the facts of this case. If the Commission had used in the Debbie regulations the allocation formula provided for in Article 19(1) of the basic regulation, this would have resulted in 98 900 tonnes of third-country and non-traditional ACP bananas which should have constituted the entire supply, to be allocated in accordance with demand, with the result that there would only have been 29 670 tonnes for allocation amongst all the economic operators who traditionally market EC and traditional ACP bananas. Those operators who were actually affected by exceptional circumstances would have been able to obtain only very minimal compensation for the quantities lost and would have had no real opportunity of replacing those quantities by other bananas, and the other operators, namely the importers of third-country bananas, would have obtained an unwarranted advantage at the expense of the former in the shape of additional import certificates for most of the 98 900 tonnes in question.

40 In order to deal with that situation and to ensure that the operators who had suffered damage should not have their reference quantities reduced for the subsequent three-year period, the Commission allocated, as we know, additional quantities to operators who had been affected by tropical storm Debbie. The Debbie regulations were designed so that the additional quantities should benefit producers directly, since they were allocated to producer organizations or to operators who directly represent the producers. It was thereby ensured that the economic benefits of the operation would accrue to the producers, as is also the case with Regulation No 478/95.

41 According to the third recital of the preamble to the basic regulation, the main purpose of the common organization of the market, apart from attainment of the internal market, is to permit bananas produced in the Community and in the ACP States to be disposed of on the Community market providing an adequate income for producers and at fair prices for consumers without undermining imports of bananas from other third-country suppliers. The system provided for by the basic regulation was intended to ensure that those producers maintained their position on the market after the abolition of the national market organizations. That result is obtained by the grant of compensatory aid and exemptions from customs duty and by restricting imports from third countries. That objective reflects Article 39(1)(b) to (e), according to which a fair standard of living is to be ensured for producers, reasonable prices are to be ensured for consumers and markets are to be stabilized.

42 In view of the foregoing, it cannot be considered that the Community legislature intended to introduce rules under which producers of Community and traditional ACP bananas who suffered damage as a result of exceptional circumstances would find themselves, as a consequence of the system set up by the rules in question, in a situation in which they could not procure the necessary quantities with which to supply their traditional customers. On the contrary, as appears from the 14th recital in the preamble to the basic regulation, the Community legislature sought to set up a system designed not to disrupt existing commercial links.

43 Finally, I would observe that, in my opinion, nothing, so far as concerns the interpretation of Article 16(3) and Article 20, may or must be inferred from the fact that the Commission submitted a proposal with the aim of expressly inserting into the basic regulation the possibility of derogating from the allocation formula laid down in Article 19. The Commission's intention to clarify matters and, consequently, to avoid legal uncertainty which would be to the detriment of the citizen must not cause any inferences to be drawn with regard to the interpretation of the basic regulation. The Commission has shown with the Debbie regulations how it interprets the provisions in question.

44 In view of the foregoing considerations, I am accordingly of the opinion that in Article 20 and Article 16(3) respectively of the basic regulation the Commission had the legal basis necessary for the purposes of the adoption of the Debbie regulations.

Article 30 of the basic regulation

45 Since I believe that the Debbie regulations have a valid legal basis in Articles 16(3) and 20 of the basic regulation, it is not necessary per se to analyse whether they could have been based on the rule set out in Article 30. That article provides that, if specific measures are required after July 1993 to assist the transition from arrangements existing before the entry into force of the basic regulation to those laid down by that regulation, and in particular to overcome difficulties of a sensitive nature, the Commission, acting in accordance with the procedure laid down in Article 27, is to take any transitional measures it judges necessary. Nevertheless, since the Commission has also referred to that article in the Debbie regulations, I shall comment thereon.

46 The Belgian and German Governments submitted that Article 30 of the basic regulation, which provides for transitional measures, is not applicable. The problem which the Commission sought to resolve by means of the Debbie regulations arose from a natural disaster which has nothing to do with the transition from national rules to a common organization of the market.

47 The Commission and the French and United Kingdom Governments contended, on the other hand, that what is involved is a transitional measure covered by Article 30 of the basic regulation. The national market arrangements which previously applied in France and in the United Kingdom contained provisions to enable importers whose normal supplies had been affected by exceptional circumstances to import bananas from Latin America to offset the shortfall. The Debbie regulations which contain the corresponding rules thus assist transition from the national legislation. The Commission is entitled to adopt transitional measures, pursuant to Article 30 of the basic regulation, until such time as the basic regulation is supplemented by specific provisions concerning the consequences of exceptional circumstances.

48 In my Opinion in Case C-68/95 T. Port v Bundesanstalt für Landwirtschaft und Ernährung [1996] ECR I-6065, I analysed Article 30 in detail. As I pointed out in point 27 of that Opinion, it may be assumed that measures such as to assist the transition may, for example, and perhaps in particular, consist in rules which, after the new entry into force of the scheme, deal with phenomena which in one way or another are related to the time before the new rules took effect. It is therefore clear that transitional measures, within the meaning of Article 30, may be rules taking special account of traders who, before the new rules were adopted, took, or failed to take, certain actions where they could not, or should/need not, have foreseen what the consequences of such actions or omissions might be after the new rules came into force.

49 Tropical storm Debbie affected Martinique and Guadeloupe as well as Saint Lucia and Dominica on 10 September 1994, that is to say after the entry into force of the common organization of the market. The present case, therefore, is not concerned with circumstances which existed during the period preceding the entry into force of the common organization of the market and were covered upon the introduction of the common organization by rules which could not have been foreseen by the persons concerned at the time.

50 Furthermore, tropical storms can occur, in principle, at any time. The difficulties to which the producers were subjected following such a storm are consequently likely to occur at any time during the whole period of validity of the basic regulation.

51 I also find it hard to see that there was a problem of transition from one system to another inasmuch as there existed, before the common organization of the market entered into force, rules in various Member States intended to alleviate the consequences of tropical storms, whereas such rules no longer existed after the entry into force of the new organization of the market, on the ground that, as I have already shown, Articles 16(3) and 20 constitute an adequate basis for the adoption of such provisions. The question remains, however, whether Article 30 affords the Commission an adequate legal basis for a period of time following the entry into force of the new market organization, for example until such time as the European Parliament and the Council have decided on the report and the proposals referred to in the first and second paragraphs of Article 32 of the basic regulation in order to derogate from the general provisions of the basic regulation; see in this regard point 28 of my Opinion in T. Port.

52 Even if that legal basis might possibly be envisaged, it should none the less be pointed out that to assume that Article 30 contains such a legal basis would have particularly far-reaching consequences also for the interpretation of transitional provisions in other fields. Since the problems which have arisen have absolutely nothing to do with the transition from national arrangements to the common organization, to accept the idea that such a legal basis exists even though the basic regulation contains no explicit evidence for that conclusion would enable the Commission - to put it bluntly - to diverge from any provision in that regulation. I therefore believe that the reference made by the Commission in the Debbie regulations to Article 30 of the basic regulation as a legal basis is unjustified. I would point out, however, that this finding cannot result in Articles 1(2) and 2 of the Debbie regulations being annulled as sought, since, as I said above, it may be considered that those articles have an adequate legal basis in Articles 16(3) and 20 of the basic regulation.

The plea in law alleging that the statement of reasons was inadequate

53 The German Government claimed that the Debbie regulations did not contain an adequate statement of reasons. In particular, they do not indicate what damage the storm actually caused and for what reasons it is not possible to determine whether the compensation paid was excessive.

54 The Commission contends that all the relevant information may be found in the Debbie regulations and that it is not required to indicate all the factual circumstances on which a legal measure is based.

55 I would first point out that, according to the case-law of the Court, the statement of reasons required by Article 190 of the Treaty must show clearly and unequivocally the reasoning on which the measure is based in such as way as to make the persons concerned aware of the reasons for the measure and thus enable them to defend their rights and the Court to exercise its powers of review. (21) None the less, the statement of reasons is not required to specify all the relevant matters of fact or of law: it must be assessed with regard to its context and weighed against practical realities and the time and technical facilities available for making the decision. (22)

56 The context of the Debbie regulations was clearly described in the second recital, in which the cause, the date and the place of the damage are set out. It also appears from the fourth recital that the increase in the quota is intended to guarantee the supply to the Community of bananas. The tariff quota was accordingly increased in Regulation No 2791/94 from 2 118 000 tonnes, in accordance with the forecast balance contained in Decision 94/654, to 2 171 400 tonnes, and in Regulation No 510/95 from 2 200 000 tonnes to 2 245 400 tonnes. The remainder of the 98 900 tonnes was allocated among the various producer countries which suffered damage. In my view, it is difficult to see how the Commission could have provided a more detailed statement of reasons and, at the same time, preserved that legislative act's character as a regulation. If the German Government considered that it could not place confidence in the quantities set out in the regulations, it could have approached the Commission in order to find out the basis for the calculations in the regulations and check them. The plea that the statement of reasons was defective is therefore, in my opinion, unfounded.

Costs

57 Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. Since the Commission has applied for costs, I propose that the Kingdom of Belgium and the Federal Republic of Germany be ordered to pay the costs of the proceedings.

58 Under Article 69(4) of the Rules of Procedure, Member States and institutions which intervene in the proceedings are to bear their own costs. The French Republic and the United Kingdom must therefore bear their own costs.

Conclusion

59 In the light of the foregoing I propose that the Court should deliver a judgment in the following terms:

(1) The action is dismissed.

(2) The Kingdom of Belgium and the Federal Republic of Germany are ordered to pay the costs.

The French Republic and the United Kingdom shall bear their own costs.

(1) - Commission Regulation (EC) No 2791/94 of 16 November 1994 on the exceptional allocation of a quantity additional to the tariff quota for imports of bananas in 1994 as a result of tropical storm Debbie (OJ 1994 L 296, p. 33).

(2) - Commission Regulation (EC) No 510/95 of 7 March 1995 on the exceptional allocation of a quantity additional to the tariff quota for imports of bananas during the first quarter of 1995 as a result of tropical storm Debbie (OJ 1995 L 51, p. 8)

(3) - `ACP' is the abbreviation for the African, Caribbean and Pacific States with which the Community concluded the Lomé Conventions.

(4) - OJ 1993 L 47, p. 1, as amended most recently by Council Regulation (EC) No 3290/94 of 22 December 1994 on the adjustments and transitional arrangements required in the agriculture sector in order to implement the agreements concluded during the Uruguay Round of multilateral trade negotiations (OJ 1994 L 349, p. 105).

(5) - See the second recital in the preamble to the basic regulation.

(6) - The customs duty was reduced to ECU 75 per tonne by Regulation No 3290/94 (see footnote 4).

(7) - According to Article 18(2) of the basic regulation, customs duty for imports in excess of the quota is ECU 750 per tonne for non-traditional ACP bananas and ECU 850 per tonne for third-country bananas.

(8) - The original wording of the basic regulation of 13 February 1993 referred to 2 million tonnes.

(9) - OJ 1993 L 142, p. 6, as amended most recently by Commission Regulation (EC) No 1409/96 of 19 July 1996 amending Regulation (EEC) No 1442/93 laying down detailed rules for the application of the arrangements for importing bananas into the Community, as regards eligibility criteria for category C operators and certain dates relevant to the administration of Community tariff quotas (OJ 1996 L 181, p. 13).

(10) - OJ 1994 L 254, p. 90.

(11) - See Commission Decision 94/752/EC of 18 November 1994 amending Decision 94/654/EC (OJ 1994 L 298, p. 48).

(12) - See footnote 4.

(13) - Commission Regulation (EC) No 478/95 of 1 March 1995 on additional rules for the application of Council Regulation (EEC) No 404/93 as regards the tariff quota arrangements for imports of bananas into the Community and amending Regulation (EEC) No 1442/93 (OJ 1995 L 49, p. 13).

(14) - 21% of the tariff quota was allocated to Colombia, 23.4% to Costa Rica, 3% to Nicaragua and 2% to Venezuela.

(15) - See footnote 2.

(16) - Proposal for a Council Regulation (EC) amending Council Regulation (EEC) No 404/93 of 13 February 1993 on the common organization of the market in bananas, Regulation (EEC) No 1035/72 of the Council of 18 May 1972 on the common organization of the market in fruit and vegetables, and Council Regulation (EEC) No 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff (OJ 1995 C 136, p. 18).

(17) - C-478/93 Netherlands v Commission [1995] ECR I-3081, paragraphs 30 and 31.

(18) - See Meyers Enzyklopädisches Lexikon, Bibliographisches Institut, Mannheim, 1971, Vol. 3, p. 441.

(19) - Commission Decision 95/407/EC of 6 October 1995 adopting the forecast supply balance for banana production, consumption, imports and exports for the Community for 1995 (OJ 1995 L 239, p. 32).

(20) - See, for example, Case C-279/93 Finanzamt Köln-Altstadt v Schumacker [1995] ECR I-225, paragraph 30.

(21) - See, for example, Case C-353/92 Greece v Council [1994] ECR I-3411, paragraph 19, and Case C-350/88 Delacre and Others v Commission [1990] ECR I-395, paragraph 15.

(22) - See, for example, Delacre and Others, cited in footnote 21, paragraph 16, Case 125/77 Scholten-Honig and De Bijenkorf [1978] ECR 1991, paragraphs 18 to 22, Case 92/77 An Bord Bainne [1978] ECR 497, paragraphs 36 and 37, and Case 16/65 Schwarze [1965] ECR 877.