2.

In its defence Greece repeats the three arguments already put forward during the stage prior to the institution of the proceedings. I shall consider them one by one, beginning with the wording of Article 38. According to the Greek Government the French and Greek versions refer to “amounts to be paid in cash” and thus do not specify whether the reduction must be made in respect of each transaction or on imports as a whole; it cannot be said that the English wording is any clearer (“the rate of import deposits and cash payments shall be reduced”). In view of that uncertainty Greece considered it proper to transfer to the list of goods which might be imported on a credit basis certain products which at the time of accession were required to be paid for in cash. Thus a total reduction of 25% in cash payments was achieved. In support of that argument the defendant refers to the records of the negotiations preceding the Act of Accession. In particular it points out that according to the view of the Sixth Ministerial Conference concerned with the negotiations (3 April 1978) “l'élimination progressive de ces deux systèmes interviendra sur une période de trois ans après l'adhésion, sous réserve d'un accord sur les modalités techniques selon lesquelles cette élimination devra intervenir” (Greece-EEC Conference, Document 21/8). The choice of the detailed arrangements was left open; it follows that Greece is free to adopt those which best suit its interests. I am not convinced by that argument. It is true that the wording of Article 38 is not felicitous and prima facie it does not seem possible to determine to what the reduction of 25% refers. If, however, it is interpreted by reference to its purpose its obscurities disappear. Article 38 has two paragraphs. The first provides that import deposits and cash payments are to be progressively eliminated over a period of three years (1 January 1981 to 1 January 1984). The second gives the timetable and the amount (25%) of the reductions. The provision thus derogates from Article 35 in order to avoid adverse effects on the national industry and hence provides for gradual liberalization of trade between Greece and the other nine Member States. It is in the light of that gradual progression, which is a feature of every transitional period, that it is necessary to consider the problem. If it is assumed that the Greek argument is correct, namely that at the four specified one-year intervals it is possible to reduce by 25% the amount to be paid in cash on the total value of imports by transferring goods from the “protected” lists to the “liberalized” list, then at the end of the three years certain products (the most sensitive) will still be subject to that requirement which — and this is the important point — will have to be completely removed on 1 January 1984 as a result of the combined provisions of Articles 35 and 38. In other words, at one stroke the Greek economy will be exposed to the acquis communautaire in relation to the free movement of goods and, I repeat, this will affect the most sensitive goods. By contrast, the specific objective of the transitional period and of the progressive removal of obstacles to importation is to prepare the Greek economy for a shock of that kind. The only way of progressively eliminating such obstacles is annually to reduce the cash payments required in respect of all products, and that result is obtained only by making a reduction in respect of each individual transaction. As for the records of the negotiations preceding accession, I do not see that they prove anything significant. The passage from the minutes of the Ministerial Conference to which Greece attaches so much importance is taken into account in the first paragraph of Article 38. It is true that at that stage of the negotiations only the principle of progressive abolition and the length of the transitional period had been defined and there was as yet no agreement on the detailed arrangements. But to infer from that that there was never any agreement is to go too far. Some time later an agreement was reached, giving rise to the second paragraph of Article 38 which determines the percentage of the reductions and the dates on which they are to take effect each year. In any event even if it were assumed that those provisions regarding percentages and dates did not lay down all the arrangements for implementing Article 38 and that in consequence Greece had a certain discretion in implementing that article, it seems clear to me that it would have had to comply with the principle that the restrictions were to be progressively eliminated by stages.