Opinion of Mr Advocate General Darmon delivered on 10 June 1986. - Alexander Moksel Import-Export GmbH & Co. Handels-KG v Hauptzollamt Hamburg-Jonas. - Reference for a preliminary ruling: Finanzgericht Hamburg - Germany. - Grant of export refunds - Beef and veal - Article 2 (2) of Regulation Nº 32/82. - Case 86/85.



European Court reports 1987 Page 00369



Opinion of the Advocate-General

++++

Mr President,

Members of the Court,

1 . By its Regulation No 32/82 of 7 January 1982, the Commission laid down "the conditions for granting special export refunds for beef and veal" ( Official Journal 1982, L*4, p.*11 ).

The situation in the Community beef and veal market, in which the opportunities to dispose of meat sold to intervention agencies are limited, prompted the Commission to adopt a measure to encourage traders to export outside the Community meat originating from "full-grown male cattle" ( Article 2 ( 1 )) "with a view to reducing intervention purchases" ( preamble, second recital ).

For that purpose, the regulation lays down the conditions for granting the refunds, which, being intended to stabilize the market to which they relate, are very specific .

2 . It was on the basis of those provisions that Alexander Moksel Import-Export GmbH & Co . Handels KG ( hereinafter referred to as "Moksel "), a meat exporter, applied for and, initially, obtained refunds for various consignments of beef and veal intended for export from the Federal Republic of Germany to the Soviet Union .

The German customs authorities through which the export formalities had been completed partially reversed their decision . In respect of a consignment of meat from full-grown male cattle slaughtered in the United Kingdom, the origin of which had been certified by the United Kingdom intervention agency, Moksel was required to pay back the special refund on the ground that the slaughter of the cattle and the completion of the customs export formalities had been carried out in two different Member States and thus in contravention of the provisions laid down in Regulation No 32/82, in particular Article 2 thereof .

Moksel instituted proceedings before the Finanzgericht (( Finance Court )) Hamburg, which has asked this Court whether :

"the grant of special refunds is conditional upon the animals having been slaughtered in the Member State in which the customs export formalities are completed"

and whether

"the slaughter of the animals in another Member State preclude((s )) the grant of special refunds even when the slaughter is certified by the competent intervention agency of that other Member State on the form provided for that purpose ".

3 . In order to clarify the background to this problem, it should be noted that Article 1 ( 1 ) of Regulation No 32/82 makes the grant of the "special" refunds conditional upon compliance with the "specific" conditions laid down in the regulation .

Determination of the type of beef or veal involved is of course of fundamental importance, in view of the purpose of the regulation . To that end, Article 2 ( 1 ) prescribes that :

"the products exported come from full-grown male cattle",

in the form of carcasses or quarters, and makes entitlement to the special refunds conditional upon the submission of proof that the meat comes from such animals . That proof is to be provided

"by means of a certificate ... issued on application by the party concerned by the intervention agency or any other authority designated for the purpose by the Member State in which the animals were slaughtered and in which the customs export formalities are completed ".

It is that provision, and in particular the passage which I have emphasized, which lies at the centre of the present proceedings . What the Court is asked to do is to determine whether the requirement that the animals be slaughtered in the State where the customs formalities are completed constitutes, in the same way as the nature of the products exported, a general condition for granting the refund .

4 . According to the Commission, both a literal interpretation of Regulation No 32/82 and the concern to ensure effective control require that the animals should be slaughtered and the export formalities completed in one and the same Member State .

By prescribing that eligibility for the refunds will depend upon compliance with the "specific conditions" laid down in it, Regulation No 32/82 refers not only to the requirement as to the nature of the products but also to the conditions contained in Article 2 regarding the submission of proof and those in Article 3 concerning the control measures to be adopted by the Member States . The Commission concludes from this that the requirement laid down in Article 2 ( 2 ) that only one Member State should be involved constitutes one of the specific conditions for the grant of special refunds .

It considers that that interpretation is confirmed by the limited nature of the conditions for checking the products laid down in Article 3 . In the absence of a Community checking procedure, the juxtaposition of uncoordinated national systems might create a climate conducive to fraud, in so far as the requirements might vary from one State to another . The requirement that slaughter be carried out in the exporting Member State precludes that risk by ensuring more effective checking of the products .

The Commission has put forward two further arguments in support of that interpretation .

It observes in the first place that the requirement, which in its view must be complied with, that the animals should be slaughtered and the export formalities be completed in a single Member State does not in any way detract from the objective of reducing intervention purchases . Traders remain free to slaughter animals and export them from any Member State in the Community, provided that only one Member State is involved in each instance . All the national markets are therefore accessible to them . Accordingly, the requirement of unity of place in no way hampers the free movement of goods within the Community . Moreover, the exportation of meat from a Member State other than the one in which the animals were slaughtered could be carried out by means of transport under customs control in accordance with the external "Community transit procedure" provided for in Article 1 ( 2 ) ( b ) of Council Regulation No 222/77 of 13 December 1976 on Community transit ( Official Journal L*38 of 9 February 1977, p.*1 ).

In the second place, the Commission relies upon certain provisions of other regulations comparable to Regulation No 32/82 . It refers in particular to :

Regulation No 1964/82 of 20 July 1982 ( Official Journal 1982, L*212, p.*48 ) and Regulation No 74/84 of 12 January 1984 ( Official Journal 1984, L*10, p.*32 ) laying down the conditions for granting special export refunds on certain cuts of boned and unboned meat of adult male cattle;

Regulation No 1136/79 of 8 June 1979 laying down detailed rules for the application of special arrangements for certain types of frozen beef intended for processing ( Official Journal 1979, L*141, p.*10 ); and

Regulation No 1687/76 of 30 June 1976 laying down common detailed rules for verifying the use and/or destination of products from intervention ( Official Journal 1976, L*190, p.*1 ).

It points out that all those regulations impose the requirement, in particular for the purpose of control measures, of unity of place for completion of the operations to which they relate .

5 . I cannot subscribe to that interpretation . Neither the letter nor the scheme of Regulation No 32/82, on the one hand, nor the control requirements, on the other, appear to make the grant of the special refunds conditional upon the animals having been slaughtered and the export formalities having been completed in the same Member State .

It is true that Regulation No 32/82 prescribes compliance with the "specific conditions" laid down in it . The Commission' s statement that those conditions are contained both in Article 2 and in Article 3 is correct . But it then goes on to draw an erroneous conclusion from that correct analysis . No provision of the regulation, and particularly not Article 2 ( 2 ), expressly makes entitlement to the refunds subject to the general condition that the operations must all be carried out in the same Member State .

Article 2 ( 1 ) indicates what has to be proved : the products must come from "full-grown male cattle ". Article 2 ( 2 ) describes how the proof is to be provided . It defines the form, "a certificate, a specimen of which is given in the Annex", and then indicates which body is competent to issue it, namely an intervention agency or any other authority designated for that purpose, and to whom it is to be produced, namely the "customs authorities" through which the export formalities were completed . Thus the form, origin and destination of the proof make up the explicit content of Article 2 ( 2 ).

As has been seen, the part of that provision identifying the body which is to issue the certificate provides for an alternative . The certificate may be issued either by the competent national intervention agency operating within the framework of the common organization of the markets in beef and veal, or by "any other authority designated for the purpose ". The phrase referring to the Member State in which the animals were slaughtered and the customs formalities were completed can, in my opinion, apply only to the second alternative .

That is apparent in the first place from a simple grammatical analysis of the first sentence of Article 2 ( 2 ), in particular the French and Italian versions : in French, it is the "autre autorité" which is "désignée" ( in Italian, "designata ") by the Member State in which the animals were slaughtered and from which the meat was exported and not the "organisme d' intervention", which, moreover, does not have to be "désigné", because it already has powers by virtue of the common organization of the market . The German and English language versions appear to me to confirm that analysis .

But in addition to that textual argument it should be noted that those two clearly separate possibilities are provided for in order to meet a requirement, that of ensuring that the certificate has probative force . If issued by the intervention agency, the certificate will be endowed with authenticity and its probative value will be accepted by every customs office in the Community . That certainty would not be so complete if the certificate were to be issued by an authority other than the intervention agency . In view of the importance of the certificate, as proof of the origin of the meat, it is essential that every exporter should be able to produce a document whose probative force cannot be contested by the customs office to which he applies .

That is why the regulation provides that if the certificate is not issued by the intervention agency it will constitute incontestable proof only for the customs authority in the Member State where the adult male cattle were slaughtered . The "other authority" designated for the purpose of issuing the certificate can only be an authority in the exporting State . The requirement that all the operations must be carried out in the same State therefore provides a guarantee that the certificate will have probative force . An indirect result of that fact is that only in that one case and only for that one reason traders will be obliged to carry out all the slaughter and export operations in the same Member State .

It is clear that they are requirements relating exclusively to the probative force of the certificate and, in certain cases, their effect is that all the operations must be carried out within a single Member State . The alternative provided for in Article 2*(2 ) enables traders in Member States where the intervention agency issues the certificate to have the cattle slaughtered there and to submit to the customs authorities in any other Member State incontestable proof as to the nature of the meat which they intend to export . The form of certificate annexed to Regulation No 32/82, by describing the holder of the certificate as the "exporter or applicant", leaves both alternatives open since the certificate may be applied for by a trader who is not the exporter and the meat may subsequently be transferred to him, and the two traders may operate in the same Member State or from different Member States .

The interpretation proposed by the Commission involves raising to the status of a general condition a condition which, although certainly binding, operates only in one particular case . Since it is contrary to the wording and the purpose of Article 2*(2 ), the imposition of such a condition cannot, it seems to me, be justified implicitly by control requirements .

6 . As the Commission has emphasized, Regulation No 32/82 did not introduce a Community control procedure . Article 3 empowers the Member States to lay down "the conditions for checking the products and for issuing the certificate ". The measures adopted are intended to

"ensure that no substitution of products takes place between the time they are checked and the time they leave the Community' s geographical territory ...".

This reliance upon national law involves the co-existence of distinct control systems . In the Commission' s view, the fact that some are more stringent than others is conducive to fraud by substitution and that risk would be avoided if all the operations were carried out in a single Member State .

That reasoning cannot be accepted . The risk of fraud, resulting from a lack of coordination - of which, moreover, the Commission has provided hardly any illustration - is already reduced by the provisions of Article 3 itself, which state that the national control measures must

"include identification of each product by means of an indelible mark on each quarter or by individual seal on each quarter ".

It is clear that that minimum standard of control is not lacking in efficacy if it is borne in mind that the identification numbers of the pieces of the slaughtered cattle must be entered on the certificate to be produced to the customs authorities, the latter thus having the means - and the responsibility - of ensuring that the meat exported corresponds exactly to what was slaughtered . It should be noted in passing that in the Federal Republic of Germany - as was stated at the hearing - no additional control measures were considered necessary . Moreover, Article 4 of Regulation No 32/82 gave the Commission the opportunity to communicate its comments to the Member States if it considered the national measures to be inadequate . It was acknowledged that it had not done so .

The existing control measures were therefore considered sufficient . Furthermore, I do not see how the requirement that all the operations should be carried out in the same Member State could significantly reduce the risk of fraud . As the plaintiff in the main proceedings stated at the hearing, without being contradicted, the products in question may pass through the hands of several intermediaries between the time of slaughter and the time of exportation, regardless of whether the operations are carried out in one Member State or in several . The requirement that the operations should be confined to one Member State therefore provides only a theoretical safeguard against the risk of fraud . Only by means of coordinated and effective national rules can the risk of fraud be significantly reduced .

Seen in those terms, that provision also displays the advantage that, by avoiding partitioning of the national markets, it upholds the freedom of traders to carry out slaughter and export operations at any location, provided that the certificate relating thereto is issued by an intervention agency .

7 . Merely for the sake of completeness, I shall briefly consider the last set of arguments put forward by the Commission .

The argument based on the existence of a Community transit procedure as an alternative available to traders wishing to take the same course of action as the plaintiff in the main proceedings does not have the scope which the Commission attributes to it . The issue is not whether there exist other means of carrying out the operation in question but rather whether that operation is prohibited by Regulation No 32/82 . I believe I have shown that it is not so prohibited .

Let me make a further point . Such an operation is advantageous, as became apparent in the course of the proceedings, where meat intended for a non-member country has already been imported into the Member State of exportation . Certain wholesalers can, pending the conclusion of contracts, store consignments of meat coming from other Member States which are accompanied, for all relevant purposes, by the certificate provided for in Regulation No 32/82 . Thus, the requirement that all the operations should be confined to one Member State would have the effect of depriving traders of the opportunities offered by their own market and, indirectly, of obstructing the free movement of the goods in question . Consequently, apart from the exception expressly provided for, traders should be free to purchase in any Member State meat which they intend exporting from the State in which they have storage or freight facilities to a non-member country .

The rules referred to by the Commission in no way detract from my analysis . Regulations Nos 1136/79 and 1687/76 cover different situations : the first relates to the importation of meat intended for processing, and the second concerns the exportation of products from intervention stocks . The control requirements in those cases are wholly different . As regards Regulations Nos 1964/82 and 74/84, which postdate the regulation at issue, they apply to boned and unboned cuts of meat from adult male cattle, which are obviously more difficult to identify .

I therefore propose that the Court should rule that :

The grant of the special export refunds provided for in Commission Regulation No 32/82 of 7 January 1982 ( Official Journal 1982, L*4, p.*11 ) is not conditional upon the animals having been slaughtered in the Member State in which the customs export formalities were completed, provided that the document certifying that the products come from adult male cattle was issued by the intervention agency of a Member State .

(*) Translated from the French .