II —

There is a second point which is the nub of the question. There is reason to impose a countervailing charge when the entry price of a product imported from third countries is lower than the reference price and Article 11(2) shows how these two prices are fixed, the prices which must be taken into account and the deductions which, where necessary, must be made. The regulation is only legal, therefore, if certain conditions of fact are fulfilled, and it is their presence which was above all disputed before the Court of first instance. But before you the argument extended to questions of law which govern the facts. What must be the method of calculating the entry price? It is around this point that the entire discussion turned and it is that which must first of all be decided in order to establish whether the regulation was properly introduced. The sixth subparagraph of Article 11 (2) reads as follows: ‘The entry price… shall be fixed on the basis of the lowest price recorded on the representative import markets referred to in the immediately foregoing subparagraph, less customs duty arising from the application of Article 23 of the Treaty and less other taxes on imports as well as transport costs from those markets to the Community frontier crossing points’. Article 2 of Regulation No 99/65 of the Commission, adopted for the application of the above provision, states which markets are to be regarded as representative. There is one for Italy, France and the Netherlands, two (Brussels and Antwerp) for Belgium and the Grand Duchy and four for the Federal Republic, which are Hamburg, Munich, Frankfurt and Düsseldorf. In its written observations the Commission has set out very fully how it interpreted these provisions. It considers first of all that the prices which must be taken into account are neither the average of the four representative German markets during the days which preceded the introduction of the regulation, nor the lowest prices recorded during the same period on one of these markets. The first system has textual arguments against it since Article 11(2) does not mention the ‘arithmetical mean’ as regards the entry price — as it does concerning the reference price; it is not compatible with the provision which lays down that it must be decided ‘on the basis of the lowest prices’, because on the representative markets there may be at the same time low prices and high prices. Further, it does not enable producers throughout the Community to be protected against imports from third countries at prices below the reference price. In fact the State-trading countries which limit their offers at low prices to certain markets could prevent the average falling below the reference price and thus prevent the imposition of a countervailing charge. But it is not possible to confine oneself merely to taking note of ‘the lowest price recorded on one of the most representative markets’, because that formula was expressly set aside by the Council in favour of the following ‘on the basis of the lowest price recorded on the representative import markets’. The expressions used presuppose in consequence that account shall be taken of several prices and clearly imply a certain area of discretion on the part of the Com mission which is also emphasized by the words on the basis of. The lowest prices are thus the point of departure for fixing the entry price, the fixing of which may be affected by very different factors: the more or less representative nature of certain markets for certain products (as it is undisputed that Munich is the leading market for all imports from the State-trading countries of Eastern Europe and Hamburg for imports from the Mediterranean, the prices which are recorded in these two towns have special importance according to the circumstances) or the date on which those prices are recorded (as prices have a tendency to rise at the end of the harvest of a product, a low price may appear as a temporary anomaly which the later markets will correct and which there is no need to take into account for the purpose of introducing a countervailing charge). In its written observations the Beus company maintained that it was only possible to obtain a representative figure on the basis of data recorded on the four German markets; it stated at the oral procedure what it meant by that. It is no longer a matter of an arithmetical mean, but of an average weighted price established by taking into account the different markets, the lowest prices recorded on those markets and the turnover actually effected. The system is ingenious but hardly appears to conform with the wording of Article 11 (2) which does not mention weighting, and it is not possible to see how one could take into account all the markets when it is necessary to take into account only the lowest prices. Two other points of disagreement exist in respect of the fixing of the entry price. According to Article 11(2) the lowest prices recorded on the representative markets must be reduced in particular by customs duties resulting from the application of Article 23 of the Treaty, and by other taxes on imports'. The Commission has included among these deductible duties, the turnover equalization tax payable on imports (a German duty) and the countervailing charge of 3 u.a. introduced by Regulation No 138/65 of 5 October 1965 on the import of table grapes from Bulgaria, Romania and Yugoslavia (a Community charge in force during the period preceding the introduction of the regulation whose validity is disputed). The deduction of these two charges is also disputed, but in my view wrongly. Textual arguments have been relied upon; it has been pointed out that Article 11(2) refers expressly to the provisions of the Treaty in respect of customs duties (‘customs duties arising from the application of Article 23 of the Treaty’); it says nothing similar in respect of the ‘other taxes on imports’, which would show that the latter cannot be Community charges, but only charges laid down by purely national provisions. Also an attempt has been made to advance the argument that the expression ‘tax on imports’ is not used in the Treaty. That discussion on terminology appears to me to be quite barren in respect of the provision to be applied. It is just because one expects to see deducted all the taxes levied on the entry of the goods into the territory of a Member State that it is necessary to choose a neutral term, which might apply both to taxes of ‘national’ origin or of ‘Community’ origin, and there could not be any question of enumerating them, taking into account the various names which may be given them in national law. It is in any case clear that the turnover equalization tax and the countervailing charge are both taxes on imports. But their deduction from the entry price is justified above all by basic, technical reasons. Since the countervailing charge to be introduced represents the difference between the import price and the reference price, these two factors must be made comparable and considered at the same stage of the economic process. The reference price, which is a producer price, does not include the turnover tax; it is proper therefore to deduct from the entry price the turnover equalization tax levied on importation. As to the countervailing charge which is already levied on an imported product, but temporarily, the Commission at the hearing set out the technical reasons which lay behind its deduction. If it were not deducted, one would find oneself at the time when it was discontinued with an import price which would immediately be below the reference price and would require a reintroduction of the charge. In short, the objections made on the legal plane against the method of calculation of the entry price do not appear to me to be acceptable. It remains that the disputed regulation could only take effect if that price, calculated on the bases which we have seen, had in fact fallen below the reference price. The Beus company maintained during the proceedings before the Finanzgericht that this condition had been fulfilled at the most for several days before the adoption of the regulation only on the Munich market, which did not justify the introduction of the charge, but that assertion is incorrect if one applies to the price the deductions which we have seen should have been made. The figures contained in the written observations of the Commission — which are indisputable — show that from 11 to 15 October inclusive, the date on which the Management Committee met, the Munich prices were always noticeably less than the reference price as they were also, but to a lesser extent, during the four days when there was a quotation at Düsseldorf. They even justified the quantification of the entry price at 12 u.a. at most and thus a countervailing charge of 4 u.a., since the reference price was 15.9 u.a. That the figure of 2 u.a. was taken was because between 15 October and the entry into force of the regulation, some days after its publication, the approach of the end of the grape harvest of Bulgarian table grapes led to an increase in import prices. There appears no doubt therefore that at the time when the regulation was adopted the conditions laid down in Article 11(2) of Regulation No 23 were fulfilled.