EAGGF ALL THE EXPENDITURE DECLARED BY THE PRODUCERS' ORGANIZATION IN THE FISHERIES SECTOR IN PORTO GARIBALDI, DOMAR, BECAUSE OF THE COMPLETE ABSENCE OF A VALID CHECK ON THE OPERATIONS OF THAT ORGANIZATION AND BY THE PRODUCERS' ORGANIZATION IN THE SAME SECTOR IN CHIOGGIA, SAN MARCO, BECAUSE OF DOUBTS AS TO WHETHER IT IS ACTUALLY FUNCTIONING .
25 IT IS COMMON GROUND THAT AT THE BEGINNING OF 1984, FOLLOWING CHECKS CARRIED OUT BY THE GUARDIA DI FINANZA ( REVENUE ENFORCEMENT SERVICE ), A COMPLAINT WAS MADE TO THE JUDICIAL AUTHORITIES ALLEGING THAT THE OFFICERS OF DOMAR WERE GUILTY OF FRAUD AND OTHER OFFENCES INASMUCH AS THEY HAD UNLAWFULLY OBTAINED, OR ATTEMPTED TO OBTAIN, THE COMMUNITY AID PROVIDED FOR WHERE FISHERY PRODUCTS WERE WITHDRAWN FROM THE MARKET DURING THE PERIOD FROM 1978 TO 1982 . THE MEMBERS OF THE CONTROL BOARD SET UP AT LOCAL LEVEL TO CHECK THAT THE PRODUCTS AT ISSUE WERE GENUINELY WITHDRAWN FROM THE MARKET WERE ALSO CHARGED .
26 FOLLOWING THOSE EVENTS, EAGGF OFFICIALS CARRIED OUT AN INSPECTION OF THE SAN MARCO ORGANIZATION, WHICH IS A SUBSIDIARY OF DOMAR . DURING THAT INSPECTION, IT WAS DISCOVERED THAT THE ORGANIZATION HAD NEITHER STAFF NOR OFFICES, NOR A WAREHOUSE OR ANY OF THE OTHER MEANS NECESSARY FOR THE FUNCTIONING OF A PRODUCERS' ORGANIZATION . IT ALSO EMERGED THAT THE ORGANIZATION SUBMITTED ABNORMALLY HIGH FIGURES IN RESPECT OF SIZE OF CATCH AND WITHDRAWALS FROM THE MARKET .
27 THE ITALIAN GOVERNMENT CLAIMS THAT THE COMMISSION WAS WRONG NOT TO PERMIT THE CONTESTED EXPENDITURE TO BE CHARGED TO THE EAGGF FOR TWO REASONS . FIRST OF ALL, NO IRREGULARITY ON THE PART OF THE ITALIAN ADMINISTRATION OR STATE BODIES WAS UNCOVERED SINCE THE ITALIAN REPUBLIC IS NOT LIABLE FOR THE FRAUDULENT CONDUCT OF THE PERSONS RESPONSIBLE FOR MAKING THE CHECKS . SECONDLY, THE ACCUSED IN THE VARIOUS CRIMINAL PROCEEDINGS DENIED THE FACTS ON WHICH THE CHARGES ARE BASED AND PLEADED NOT GUILTY IN THE CRIMINAL PROCEEDINGS CURRENTLY PENDING . IT IS NOT THEREFORE POSSIBLE TO RELY ON THEIR NEGLIGENCE SINCE THERE HAS NOT YET BEEN ANY DEFINITIVE JUDICIAL FINDING ON THAT SUBJECT .
28 THOSE ARGUMENTS CANNOT BE ACCEPTED . FINANCIAL COMPENSATION FOR THE WITHDRAWAL FROM THE MARKET OF FISHERY PRODUCTS CANNOT BE CHARGED TO THE EAGGF IF THE PRODUCERS' ORGANIZATION HAS NOT BEEN SUBJECT TO THE CHECKS PROVIDED FOR UNDER COMMUNITY RULES . ARTICLE 8 OF COMMISSION REGULATION NO 2062/80 OF 31 JULY 1980 ON THE CONDITIONS AND PROCEDURE FOR GRANTING OR WITHDRAWING RECOGNITION OF PRODUCERS' ORGANIZATIONS AND ASSOCIATIONS THEREOF IN THE FISHING INDUSTRY ( OFFICIAL JOURNAL, L*200, P.*82 ) PROVIDES THAT "THE MEMBER STATES SHALL EXERCISE CONTINUOUS SUPERVISION OF THE OPERATION OF RECOGNIZED PRODUCERS' ORGANIZATIONS AND ASSOCIATIONS", WITH PARTICULAR REGARD TO COMPLIANCE WITH THE CONDITIONS FOR RECOGNITION OF SUCH ORGANIZATIONS AND THE MARKETING RULES WHICH THEY ARE REQUIRED TO LAY DOWN .
29 UNDER THOSE CIRCUMSTANCES, THE QUESTION IS NOT WHETHER FRAUDULENT BEHAVIOUR ON THE PART OF THE PRODUCERS' ORGANIZATIONS CONCERNED CAN BE SHOWN TO HAVE EXISTED AT THE