CELEX: 61976CC0077
Language: en
Date: 1977-05-03
Title: Joined opinion of Mr Advocate General Reischl delivered on 3 May 1977. # F.lli Cucchi v Avez S.p.A. # Reference for a preliminary ruling: Pretura di Abbiategrasso - Italy. # Case 77/76. # Interzuccheri S.p.A. v Società Rezzano e Cavassa. # Reference for a preliminary ruling: Pretura di Recco - Italy. # Case 105/76.

OPINION OF MR ADVOCATE-GENERAL REISCHL
      DELIVERED ON 3 MAY 1977 (
            1
         )
      
         Mr President,
      
         Members of the Court,
      Both the references for a preliminary ruling (Case 77/76 and Case 105/76), on which I shall give a single opinion because to some extent they raise the same problems and because they were dealt with at a single oral hearing, concern the interpretation of Community law with regard to Italian legislation concerning the market in sugar. The broad outlines of this legislation are familiar to the Court from other cases, in particular from the well-known sugar case (Joined Cases 40 to 48, 50, 54 to 56, 111, 113 and 114/73, Coöperatieve vereniging Suiker Unie UA and Others v Commission of the European Communities, Judgment of 16 December 1975 [1975] ECR 1663
         et seq.). My preliminary remarks may therefore be very brief.
      Before the entry into force of the common organization of the market in sugar (Regulation No 1009/67/EEC of the Council of 18 December 1967, OJ, English Special Edition 1967, p. 304) prices in the Italian sugar market were officially regulated by the fixing of maximum prices. The level of these prices was above that in other Member States. This was caused by higher production costs in Italy owing to particular climatic conditions affecting cultivation of sugar-beet and the structure of the processing industry. In view of this by Article 34 of Regulation No 1009/67 Italy was empowered to grant adaptation subsidies up to a specified maximum amount to its beet growers and to its beet processing industry. The authorization applied originally until the 1974/75 marketing year. However by Article 38 of the new organization of the market in sugar (Regulation No 3330/74 of the Council of 19 December 1974, OJ L 359 of 31. 12. 1974, p. 1) it was extended until the 1979/80 marketing year.
      In order to raise the funds necessary for the subsidies the Italian Interdepartmental Committee on Prices, hereinafter referred to as ‘the CIP’, made provision by an order of 1968 for levying a surcharge (‘sovrapprezzo’), to be borne by the consumers, on white sugar produced both at home and abroad for the benefit of an equalization fund which had also been set up by the CIP. The Commission has specified in detail (cf. page 8 of its written observations in French) which projects, apart from the adaptation subsidies, were financed from this revenue under the original system. The measures were retained in the following marketing years, the surcharge being fixed at the beginning of each marketing year, and remain in force today. For the 1975/76 marketing year the surcharge was Lit 56 per kg; for the 1976/77 marketing year it was raised to 70 lire per kg.
      Mention should further be made solely in respect of Case 77/76 of the special measure adopted by the CIP on 2 July 1976. Italian undertakings were thereby obliged to notify the stocks of sugar of more than 500 kg held by them on 2 July 1976 (at midnight). A special surcharge (‘sovrapprezzo straordinario’) was imposed on these stocks at the rate of Lit 37-842 per kg if the surcharge of Lit 56 per kg had not been paid and at the rate of Lit 51-842 per kg if the surcharge had been paid. Stocks held by processing undertakings amounting to 2/12ths of their consumption in the 1975/76 marketing year and denatured sugar to be used as animal fodder were excluded from the charge.
      In June 1976 Cucchi, the plaintiff in the main action in Case 77/76, requested Avez to import on its behalf a quantity of granulated sugar from the Federal Republic of Germany. The importation was carried out in June and was subjected to the abovementioned surcharge. Cucchi received a first delivery at the end of June 1976; the remainder of the imported goods were stored by Avez and were to be delivered on 17 July. The surcharge imposed on the first consignment, Lit 56 per kg, was paid by Cucchi. However when Avez requested payment of the special surcharge due on the remaining consignment Cucchi refused to pay. It takes the view that both the surcharge and the special surcharge are incompatible with the provisions of Community law and for that reason it initiated proceedings against Avez seeking reimbursement of the surcharge already paid and a declaration that it was not obliged to pay the special surcharge.
      In the second case which has given rise to the reference for a preliminary ruling in Case 105/76, in October 1976 Interzuccheri sold sugar imported from France to the undertaking Rezzano & Cavassa. It requested payment of the surcharge which in this case having regard to the date of the importation amounted to Lit 70 per kg. As Rezzano refused to pay that amount, also in reliance on Community law, Interzuccheri brought proceedings before the Pretura di Recco.
      In the first case the Federazione Nazionale Commercio Alimentare (Federgrossisti) — Sindacato Nazionale Zucchero (National Food Trade Federation — National Sugar Association) and in the second case the Associazione Nazionale tra gli Industriali dello Zucchero del Lievito e dell'Alcool (The National Association of Sugar, Yeast and Alcohol Producers) intervened in each case on behalf of the plaintiff.
      In view of the arguments based on Community law the court hearing each case decided to stay proceedings and to refer questions to the Court of Justice for a preliminary ruling.
      Accordingly the following questions are to be answered in Case 77/76:
      I. Concerning the introduction of the surcharge in general:
      
               1.
            
            
               Must Article 13 (2) of the Treaty of Rome and Article 21 (2) of Regulation (EEC) No 3330/74 (on the common organization of the market in sugar) as well as Article 20 (2) of Regulation No 1009/67/EEC (replaced by the former) be interpreted to mean that in trade between the Member States in the products mentioned in the said EEC regulations the imposition of a pecuniary charge having the following characteristics is prohibited:
               
                        (a)
                     
                     
                        it is applied by a measure of a national authority on any quantity of sugar whether home-produced or imported;
                     
                  
                        (b)
                     
                     
                        the revenues collected through a public body are employed for the sole benefit of the sugar industry and producers of beet established in the territory of the State in which the charge is imposed (see Order No 1195 of the Comitato Interministeriale dei Prezzi of 22 June 1968 as subsequently amended);
                     
                  
                        (c)
                     
                     
                        it forms part of a system of aids for which specific provisions have been laid down in Community law (see Article 34 of Regulation No 1009/67/EEC; Article 38 of Regulation (EEC) No 3330/74 and Article 4 of Regulation (EEC) No 1487/76);
                     
                  
                        (d)
                     
                     
                        it has never been authorized by any Community institution and it has never been imposed in conformity with the procedure of Article 41 of Regulation No 1009/67/EEC or with that of Article 36 of Regulation (EEC) No 330/74?
                     
                  
         
               2.
            
            
               If the reply to Question 1 is in the affirmative, must it be considered that the prohibition against imposing the abovementioned pecuniary charge operates from the entry into force of Regulation No 1009/67/EEC or from some other date?
            
         
               3.
            
            
               From the date when the prohibition entered into force, have individual traders who have imported sugar (or the products referred to in the said EEC regulations) from other member countries of the common market an individual right not to pay the pecuniary charge referred to in Question 1, and have they accordingly the right to claim reimbursement where payment has been made?
            
         
               4.
            
            
               In any case, in view of the fact that since 1968 sugar has been subject to the Community agricultural rules (Regulation No 1009/67/EEC and now Regulation (EEC) No 3330/74) which reserve to the institutions of the EEC a practically exclusive power to make rules, does the imposition of a pecuniary charge having the characteristics described above in Question 1 constitute an infringement of the second subparagraph of Article 40 (3) of the Treaty according to which the common organization of the agricultural markets ‘shall exclude any discrimination between producers or consumers within the Community’?
            
         II. Concerning the special surcharge
      
               5.
            
            
               Are there also infringements of the Community rules referred to in the questions set out above if the pecuniary charge imposed at the same time both upon home-produced sugar and upon imported sugar is partially collected, in so far as sugar imported from the other member countries of the EEC is concerned, not when it crosses the frontier but rather when the sugar is already in stock with the importers or the (commercial and industrial) undertakings which have bought the imported sugar from the latter?
            
         
               6.
            
            
               In the light of the general principles of law by which the Community rules and case-law must be guided, must the provisions contained in Regulation (EEC) No 3330/74 (especially those in Articles 33 to 44), as well as the provisions contained in Articles 1 to 8 and 38 to 43 of the Treaty of Rome, be interpreted in such a way that the imposition on both home-produced and imported sugar of a pecuniary charge according to the following criteria must be regarded as improper and prohibited:
               
                        (a)
                     
                     
                        it is imposed by a measure of the national government without any prior authorization from the Community institutions;
                     
                  
                        (b)
                     
                     
                        it is imposed without regard to the procedure laid down in Article 36 of Regulation (EEC) No 3330/74;
                     
                  
                        (c)
                     
                     
                        it is imposed as a once-for-all charge on the principle that it is exceptional;
                     
                  
                        (d)
                     
                     
                        it is imposed with immediate effect upon sugar already in stock with the undertakings and consequently has retroactive effect in that it does not allow the undertakings to choose between buying sugar with the consequent imposition of the charge and not buying sugar with the consequent exemption from the charge;
                     
                  
                        (e)
                     
                     
                        it is imposed when sugar passes from one sugar undertaking to another, in the absence of the grounds mentioned in Article 33 of Regulation (EEC) No 3330/74, which justify recourse to the measures to be adopted according to the procedure laid down in Article 36 of the same regulation;
                     
                  
                        (f)
                     
                     
                        it is imposed under the equivocal title of ‘sovrapprezzo straordinario’ (special surcharge), whilst substantially it deals with the same levy termed ‘tassa di sfioramento sullo zucchero’ (skimming-off tax on sugar) which in the past has always been applied directly through Community measures (see Regulation No 796/68 of the Council; Regulation No 1344/71 of the Commission) or at least authorized by the Community institutions (see Regulation No 834/74 which was the subject of the judgment in Case 23/75 (Rey Soda))?
                     
                  
         
               7.
            
            
               Have the Community provisions specified above conferred upon undertakings liable — under national legislation — to pay the pecuniary charge mentioned above the individual right not to pay such charge on stocks of sugar, whether home-produced or imported, which are in their hands (and to claim the reimbursement of any payment made) or is such individual right not to pay (and to claim the reimbursement of any payment made) at least limited to the quantities of sugar imported from the member countries of the EEC and stocked by the directly importing undertakings or by other (commercial and industrial) undertakings which have purchased it from the latter?
            
         
               8.
            
            
               Is it possible on the basis of the Community provisions referred to in Question 6 and in the light of the general principles of law by which the Community rules and case-law must be guided, to consider it lawful that one category of citizens is rendered liable, with retroactive effect, to a pecuniary charge the revenue from which is applied for the benefit of other categories of citizens whose economic and commercial interests conflict with theirs?
            
         In Case 105/76, which is solely concerned with the admissibility of the surcharge, the text of the questions referred to the Court for a preliminary ruling is as follows:
      
               1.
            
            
               Must Article 13 (2) of the Treaty of Rome, Article 21 (2) of Regulation (EEC) No 3330/74 (on the common organization of the market in sugar) and Article 20 (2) of Regulation No 1009/67/EEC (replaced by the former) be interpreted as prohibiting, in trade between the Member States in the products mentioned in the said Community regulations, the imposition of a pecuniary charge having the characteristics of the ‘surcharge’ on sugar, as established and regulated by the CIP Order No 1195 of 22 June 1968 and subsequent amendments (CIP Orders No 1222 of 20. 6. 1969, No 9 of 30. 6. 1970, No 15 of 30. 6. 1971, No 7 of 3. 8. 1972, No 9 of 26. 6. 1973, No 27 of 28. 6. 1974, No 19 of 7. 8. 1975, No 20 of 1. 7. 1976 and No 24 of 1.10. 1976):
               
                        (a)
                     
                     
                        which is applied by a decision of the national authority to any quantity of sugar, whether home-produced or imported;
                     
                  
                        (b)
                     
                     
                        the revenue from which is assigned in part to producers of beet established in the territory of the State which imposes the charge, in part to the sugar industry also established in the territory of that State and in part to cover various charges (including the management expenses of the Cassa Conguaglio Zucchero)?
                     
                  
         
               2.
            
            
               If the reply to Question 1 is in the affirmative, does the prohibition against imposing the abovementioned pecuniary charge take effect from the entry into force of Regulation No 1009/67/EEC, or from some other date?
            
         
               3.
            
            
               From the date when the prohibition entered into force, have individual traders who have imported sugar (or the products referred to in the said EEC regulations) from other member countries of the common market an individual right not to pay the pecuniary charge referred to in Question 1 and, in consequence, the right to claim reimbursement where payment has been made?
            
         
               4.
            
            
               In any case, in view of the fact that since 1968 sugar has been subject to the Community agricultural rules (Regulation No 1009/67/EEC and now Regulation (EEC) No 3330/74), does the imposition of a pecuniary charge having the characteristics described above in Question 1 constitute an infringement of the second subparagraph of Article 40 (3) of the Treaty, according to which the common organization of the agricultural markets “shall exclude any discrimination between producers or consumers within the Community”?
            
         My opinion with regard to these questions is as follows:
      
               1.
            
            
               The first question raised by both cases concerns the concept “charge having an effect equivalent to a customs duty”. It is to be defined in relation to the surcharge which is also imposed on imported sugar, whose place within the system has been described above. Further factors to be borne in mind, as appears from Case 77/76, ate that the revenue from the surcharge benefits solely the sugar industry and the producers of sugar-beet within the territory of the Member State imposing the charge, that it is a part of a system of subsidies for which special provisions of Community law are applicable and that it has not been approved by Community bodies and has not been introduced in compliance with the procedure under Article 41 of Regulation No 1009/67/EEC or Article 36 of Regulation (EEC) No 3330/74.
               The surcharge is imposed equally on imported sugar and home-produced sugar. For that reason it is appropriate to examine the rules in the light of Article 95 of the EEC Treaty which provides:
               “No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products”.
               Although the courts making the orders for reference also conceived of application of Article 13 of the EEC Treaty and the corresponding provisions relating to the common organization of markets concerning the prohibition of the imposition of charges having an effect equivalent to customs duties, that is, the application of a provision which, it is clear from the decided cases (cf. for example judgment of 18 June 1975 in Case 94/74, Industria Gomma Articoli Vari (IGAV) v Ente Nazionale per la Cellulosa e per la Carta (ENCC) [1975] ECR 699
                  et seq.), cannot be applied in conjunction with Article 95, the courts were referring to two earlier judgments which concerned a comparable rule and which in this respect made mention of a possible application of Article 13 (2) of the EEC Treaty.
               That case concerned the Italian Ente Nazionale per la Cellulosa e per la Carta and the related rules concerning levies and subsidies. With regard to those measures whereby levies are imposed on paper and similar products, the revenue from which finances certain activities concerning research and development in the paper and cellulose production sector and subsidies for newsprint, it was stated in a judgment of 19 June 1973 (Case 77/72, Carmine Capolongo v Azienda Agricola Maya [1973] ECR 623) that in interpreting the term “charges having an effect equivalent to customs duties on imports” it may be appropriate to take account of the destination of the charges imposed. Accordingly application thereof might be conceivable if the financial charge is intended exclusively to “support activities which specifically benefit the taxed domestic product …” that is to say, if it appears that for domestic products the charge “constitutes in reality a set-off against benefits or aids previously received”. In a second judgment which is relevant to the present circumstances, delivered on 18 June 1975 concerning the same problem (Case 94/74, Industria Gomma Articoli Vari (IGAV) v Ente Nazionale per la Cellulosa e per la Carta (ENCC) [1975] ECR 699 at p. 710), it was stated that application of Article 13 of the EEC Treaty was conceivable if such a duty which was limited to particular products “had the sole purpose of financing activities for the specific advantage of the taxed domestic products, so as to make good, wholly or in part, the fiscal charge imposed upon them”. It was also stressed in that judgment that such a definition would imply a clearly established connexion “between, on the one hand, the collection of a fiscal duty levied without distinction on the products in question, whether domestic or imported and, on the other hand, the advantage which enures only for the benefit of the domestic products by reason of the proceeds of that same duty”.
               In the forefront of the present issue there is raised therefore the question of the exact scope of the decided cases and whether they should be defined more narrowly or whether further extension is even possible.
               Those parties to the proceedings which support the view that the surcharge should be regarded as a charge having an effect equivalent to a customs duty relied in particular on the fact that pursuant to the latter judgment it is sufficient if the domestic products subject to the charge are accorded partial relief by the granting of benefits from the revenue of the charge. In this respect it is relevant that the total charge imposed on home-produced sugar was obviously considerably greater than the amounts granted to the Italian sugar industry directly as subsidies. In addition those who took that view argued that the assistance provided from the revenue from the charges to the sugar-beet growers should be taken into account. This is supported, they claim, not only by the fact that sugar and sugar-beet are covered by a common organization of the market, but it may also be accepted that the aids to the sugar-beet growers directly benefit the sugar industry namely by making the final product less expensive and by the fact that domestic sugar-beet production is increased by means of the aids. They state that in view of this it is even evident that because the total revenue from the surcharge is greater than the charges borne by the domestic sugar industry there exists additional aid and not merely a compensation for the charge.
               Against this stands the view which is advocated by the Commission and the Italian Government. They argue that the judgments referred to above should be restrictively interpreted and in particular that the view that partial relief of the domestic product is sufficient should be dismissed. In their opinion application of Article 13 is only possible if the revenue from a charge benefits the domestic product exclusively and directly and if in addition by this means the domestic products obtain complete relief with the result that the imported products alone are subject to the charge.
               Faced with this dispute and the respective arguments, I would suggest that the Court of Justice clarifies the decided cases even to the extent of restricting them in accordance with the sense advocated by the Commission. This is supported on the one hand by the requirement of clarity of concepts which is particularly important in relation to fundamental provisions relating to the customs union which may be directly applicable. It is only in this way that the considerable difficulties relating to practical application which the Commission has referred to in detail can be avoided. It is further supported by the fact that it in fact appears appropriate to include borderline cases of parafiscal rules under the abovementioned Article 95 in particular because that provision is directly applicable as was once again emphasized in the judgment in Case 74/76 (Jannelli & Volpi S.p.A., Milan, v Ditta Paolo Meroni, Milan, Judgment of 22 March 1977).
               For the term “charges having an effect equivalent to customs duties”, in so far as the destination of the charge is relevant, the decisive factor should be that the domestic products bearing the charge and those receiving the benefit should be identical. Moreover the judgment in Case 94/74 apparently refers to this in mentioning activities for the specific advantage of the taxed domestic products which no doubt excludes indirect benefits through the raw materials used. It is also supported by the judgment of 17 February 1976 in Case 45/75 (REWE-Zentrale des Lebensmittel-Großhandels GmbH v Hauptzollamt Landau/Pfalz [1976] ECR at p. 194) where the judgment emphasizes in respect of Article 95 that comparison must be made between the taxation imposed on products “which, at the same stage of production or marketing, have similar characteristics and meet the same needs from the point of view of consumers”. Accordingly in the present case the benefit granted to sugar-beet growers should not be taken into consideration. A not inconsiderable factor in this decision is that the price system applicable to sugar-beet and the conflict of interests between the sugar-beet growers and the sugar industry make it very doubtful whether the benefit to the sugar-beet growers has any effect on the production costs of the sugar industry and that other indirect effects such as the maintenance and expansion of beet-growing in the vicinity of the processing industry can only be defined so imprecisely that they can certainly not enter into consideration as regards Article 13.
               In addition emphasis should be placed on the fact that Article 13 is only applicable if the taxed domestic products are benefited to such an extent that they receive total relief. This was stated by Mr Advocate-General Trabucchi in his opinion in Case 94/74 with the convincing argument that Article 13 only applies to circumstances such as the present in a case involving a substantial evasion of the law (‘sostanziale frode alla legge’). This is also supported by the passage in the judgment in Case 77/72 which states that the prohibition contained in Article 13 is aimed at any tax which is imposed specifically on an imported product to the exclusion of the similar domestic product. Moreover it is only in this way that a lack of conceptual clarity and difficulties of definition with regard to Article 95 can be avoided.
               Accordingly it seems clear to me that the first question can only be answered in the sense proposed by the Commission, that is to say, that a charge which is imposed on home-produced and imported goods according to the same criteria can only be regarded as a charge having an effect equivalent to a customs duty within the meaning of Article 13 of the EEC Treaty if the revenue from the charge solely benefits the taxed domestic products, if the domestic products bearing the charge and receiving the benefit are identical and if the benefits granted to the domestic products entail complete relief from the charge. From this it will perhaps also be clear — though this conclusion should of course be drawn by the national courts — that the surcharge imposed by the CIP cannot be regarded as a charge having an effect equivalent to a customs duty. This may be said because the revenue from the charge is not used solely for the national sugar industry but to a large extent is also used for sugar-beet production quite apart from the the fact that under the basic system its use for other purposes is not excluded. In addition there does not appear to exist total relief for home-produced sugar by means of the subsidies granted to the sugar industry; according to the figures produced in the course of the proceedings the charge borne by domestic sugar was Lit 75 milliard as against a total amount of subsidies of merely Lit 28 milliard.
            
         
               2.
            
            
               In my opinion we should not content ourselves with merely answering the first question in the negative. Rather in order to place the national courts in a position to appraise the factual situation correctly we should also make some remarks as to Article 95 of the EEC Treaty and related questions in particular because reference was expressly made to this point in the proceedings.
               The first part of these comments can be very brief. Thus in a judgment delivered very recently in Case 74/76 (Jannelli & Volpi S.p.A. v Ditta Paolo Meroni, judgment of 22 March 1977) it was stated that Article 95 is not merely applicable to charges which are intended to provide the State with general revenue. Because of the broad formulation of Article 95 it is also possible to include charges which are imposed to the benefit of other establishments governed by public law and it also does not exclude special charges applicable to a particular product or such charges for which a particular purpose is laid down. It is further clear that Article 95 does not require a mere comparison of charges but that it also makes it possible to take account of benefits which flow back to the taxed products from the revenue from charges. If this occurs systematically this may produce the result, as was stated by Mr Advocate-General Trabucchi in his opinion in Case 94/74 (Industria Gomma Articoli Vari v Ente Nazionale per la Cellulosa e per la Carta, judgment of 18 June 1975 [1975] ECR 699), that imported products are made indirectly liable to higher charges than similar domestic products which receive relief. In this respect as well for reasons of legal certainty which are of great importance in respect of directly applicable provisions it appears to me doubtful whether account may be taken of such indirect effects which are difficult to appraise, as may arise in the present case from the relief given to the basic product. If we take the figures which the Commission produced in the course of the proceedings — in the 1975/76 financial year the surcharge was Lit 56 compared to a subsidy to the sugar industry of Lit 21-56, whilst in the 1976/77 financial year there was a surcharge of Lit 70 compared with a subsidy of Lit 27-06 — it may be assumed although the final decision must be taken by the court making the order for reference, that Article 95 is applicable because home-produced sugar bears a lower charge than that on imported sugar.
               In regard to this first conclusion however a further question must be raised, which is apparent in the questions put by the court making the order for reference, namely whether the assessment is influenced by the fact that the relief offered to Italian sugar production is covered by a Community measure.
               In this respect the Italian Government states that because the Community did no more than authorize a subsidy and fix a maximum amount and because the aid concerned is not a Community subsidy but a national subsidy it had a free hand with regard to the method of financing the subsidy. In view of the fact that before the entry into force of the common organization of the market such measures had been financed by means of the sugar price and since in comparison with the increase in the cost of living that price had only risen to a moderate degree and finally because the financial position of the State does not allow of financing out of its budget it appeared appropriate to impose a uniform charge on sugar consumption and in particular, because imports were showing a tendency to increase, it was inconceivable to increase the competitive advantage of imported sugar by exempting it from the charge.
               In this respect it is difficult to accept the view of the Italian Government for several reasons.
               It is first of all important that Article 38 of Regulation (EEC) No 3330/74 which authorizes national aids must be interpreted restrictively because it constitutes a derogation from the general prohibition on aids which also applies to the common organization of the market in sugar under Article 41 of Regulation (EEC) No 3330/74. Article 38 therefore covers the granting of relief but makes no provision as to the admissibility of a specific method of financing such aid. Further it is necessary to bear in mind the findings in the abovementioned judgment in Case 74/76 to the effect that if particular aspects of rules relating to aid can be isolated and are not necessary for the attainment of the object sought they are to be appraised under special provisions. This is applicable in the present circumstances to the method of financing the aid. Finally reference was also correctly made to the judgment in Case 47/69 (French Republic v Commission of the European Communities, Judgment of 25 June 1970 [1970] ECR 487) which related to a French parafiscal system intended in essence to benefit the national textile industry.
               In that judgment it was emphasized that it is necessary to examine whether the method by which aid is financed complies with Article 95 of the Treaty and it was stated that it was conceivable that aid might be permissible but that the disturbance created thereby might be increased by the method of financing it. It is true to say that there exists a difference between that case and the present instance in so far as under the French system the extent of the aid was dependent on the revenue from the charge; in my opinion that difference is not fundamental (such a connexion does not indeed exist under the system of the surcharge) but the decisive factor is that in the present case as well the discriminatory effect to the detriment of imported products is aggravated by the method of financing.
               Accordingly it can also be stated in respect of the first question that Article 95 of the EEC Treaty may be applicable in an assessment of the surcharge and that, irrespective of whether the aid granted complies with the limits permitted by the Community, it is not possible to derive justification for the varying charge on home-produced sugar on the one hand and imported sugar on the other from the fact that the support for national sugar has as it were been given the blessing of Community law.
            
         
               3.
            
            
               In view of this conclusion it is in fact no longer necessary to examine Questions 2 and 3 raised by the courts making the order for reference. Those questions presuppose that the surcharge is to be regarded as a charge having an effect equivalent to a customs duty. On this assumption the questions seek clarification of the time from which the, prohibition on the imposition of charges having an effect equivalent to customs duties is applicable. In addition they seek a decision whether from the entry into force of the prohibition there existed for traders importing sugar from other member countries an invididual right not to pay the financial charge or to demand its refund if it has been paid.
               It would however be possible to rephrase these questions and to relate them to. Article 95. If this is done — and in accordance with my remarks on the first question this would certainly seem appropriate — the following brief observations may be made in respect of Questions 2 and 3.
               It has already been stated in the decided cases — I refer in particular to the judgments in Case 57/65 (Alfons Lütticke GmbH v Hauptzollamt Saarlouis, Judgment of 16 June 1966 [1966] ECR 205) and Case 45/75 (REWE-Zentrale des Lebensmittel-Großhandels GmbH v Hauptzollamt Landau/Pfalz, Judgment of 17 February 1976 [1976] ECR 183) that the first paragraph of Article 95 of the EEC Treaty has direct effect and creates individual rights which national courts must protect. For provisions which were applicable at the time of the entry into force of the Treaty the first paragraph of Article 95 became fully effective at least from the beginning of the second stage, that is to say, from 1 January 1962.
               If individuals rely on that provision after the date of its taking effect the necessary consequence is that the imposition of charges which infringe Article 95 must be declared to be inadmissible. If the charges have already been paid then a further consequence of its direct applicability from the point of view of Community law is that the amount must be refunded. On the other hand I do not believe that the view advocated by the Italian Government that direct applicability cannot be relied on in respect of sums which have been paid before the charge concerned was authoritatively classified is correct. In fact such a measure — which according to a relevant decision by the Court of Justice is mere legal subsumption — does not have legislative effect. However it might be relevant that under national law important time-limits have already expired. Reference was made to this in the judgment in Case 45/75. In addition it should be remembered — as the Court of Justice emphasized in the judgment in Case 74/76 — that it is for the national court to determine whether the whole of a discriminatory charge is to be regarded as not payable or only the additional charge on the imported products.
               This is probably a sufficient answer to Questions 2 and 3.
            
         
               4.
            
            
               My observations in respect of the fourth question raised by the courts making the reference can also be relatively brief. As the Court is aware, that question raised the problem of whether a financial charge of the nature described by the courts does not constitute an infringement of the second subparagraph of Article 40 (3) of the EEC Treaty which prohibits discrimination between producers or consumers.
               In this respect the Commission has correctly pointed out that a series of specific provisions which also rely on the principle of non-discrimination such as for example Article 12 et seq., 30 et seq. or Article 95 of the EEC Treaty could be applied to circumstances such as the present. In addition it would also be possible to apply the provisions relating to State aid in so far as the support for the domestic products by means of the surcharge goes beyond what was permitted by the Community.
               Accordingly it does not appear necessary to examine in addition the question concerning the interpretation of the second subparagraph of Article 40 (3). It may remain open whether that article only applies to measures within the context of a common organization of the market but not for State measures outside such a framework or whether, as I thought appropriate in my opinion in Case 52/76 (Luigi Benedetti v Munari F.lli s.a.s., Judgment of 3 February 1977), Article 40 may also be invoked when measures adopted by a State have effects on the aims and the functioning of a common organization of the market.
            
         
               5.
            
            
               The observations set out above deal fully with all the questions raised by the reference for a preliminary ruling in Case 105/76. The remaining questions relate solely to Case 77/76. They concern the special surcharge and seek to assess its compatibility with Community law from various points of view.
               
                        (a)
                     
                     
                        The Italian measure here at issue imposed a charge on all stocks of sugar held in Italy on 2 July 1976 apart from certain quantities held by processing undertakings. The rate applicable was Lit 37-842 per kilogramme if the surcharge of Lit 56 had not yet been paid and a rate of Lit 51-842 per kg if the surcharge had already been paid. As was stated by the Commission, in the first case the rate of the charge was equal to the difference between the prices calculated in application of the rate of exchange in force for the lira before 1 July 1976 and those prices ensuing from the new value of the ‘green lira’ applicable from 1 July 1976 by virtue of Regulation No 1020/76. In the second case the amount of the charge corresponded to the abovementioned difference and in addition the difference between the former surcharge (Lit 56 per kg) and the new surcharge (Lit 70 per kg). On the other hand the increase in the intervention price for sugar in units of account and the new fixing of the maximum price for sugar in Italy which after 1 July 1976 was apparently Lit 80 above the price in the preceding marketing year played no part in fixing the rate of the charge.
                     
                  
                        (b)
                     
                     
                        In the legal appraisal of those factors it is of course possible to leave aside for the present that proportion of the charge which corresponded to the difference between the old and the new surcharge. The Commission is right to emphasize in that respect that the assessment carried out in respect of the surcharge under Article 95 of the EEC Treaty is sufficient. Accordingly the present examination may be restricted to the question concerning that proportion corresponding to the increase in price arising from the new fixing of the exchange rate for the lira. In this respect we are confronted with the problem whether the Member States have the right to take such compensatory measures on the change-over from one marketing year to another or whether such measures fall within the sphere of jurisdiction of the Community and can only be adopted with the consent of the Community institutions.
                        The Italian Government and the Italian sugar industry regard the measures taken as unexceptionable from the point of view of Community law. In their view the special surcharge is of the same nature and has the same functions as the surcharge, which is fixed at the beginning of a marketing year by calculating in advance sugar consumption on which the revenue is dependent, and the foreseeable production, in accordance with which the funds necessary for the subsidy are determined. In this respect mistakes are possible, that is to say it may happen that the scheme has a deficit because the amount necessary for the aid is not produced by the sugar consumption. In contrast to earlier years that is what happened at the end of the 1975/76 marketing year. In such a situation however it is appropriate to undertake a retroactive correction by means of a special surcharge; it is argued that it certainly appears fitting not to seek to off-set the deficit by means of an increased surcharge in the subsequent marketing year, thus admitting considerable delay, but rather to impose the charge on the stocks of the product existing at the end of the marketing year which would in fact have had to finance the subsidies by means of the surcharge and which would otherwise produce unjustified profits for the undertaking holding the stocks. It is therefore purely a measure equalizing prices and in no way a measure concerning the organization of the market. In particular the measure pursues an object different from measures under Article 33 of Regulation No 3330/74. Article 33 is concerned with the avoidance of disturbances in the future; the relevant measures must therefore be adopted or notified in good time in order to discourage excessive maintenance of stocks. The special surcharge on the other hand was only fixed after the end of the marketing year.
                        If in its written submissions in this respect the Commission was not sufficiently decisive — an impression which might arise in view of the statements of the Commission concerning the meaning of Article 33 of Regulation No 3330/74 and the fact that the special surcharge did not cover the total increase in the sugar price in Italy — it adopted a completely unequivocal position in answer to the questions put by the Court of Justice and in particular in the course of the oral proceedings. It now firmly advocates the view that the measures adopted do not fall within the powers of the Member States, that initiatives at Community level are necessary and that therefore in such a case it was for the Commission and the Management Committee to act in accordance with the procedure provided for under the common organization of the market in sugar (Article 35 et seq. of Regulation No 3330/74).
                        Having weighed up all the arguments for and against the view of the Commission I would support that view.
                        In this respect one convincing argument may be derived from the judgment of 30 October 1975 in Case 23/75 (Rey Soda v Cassa Conguaglio Zucchero [1975] (ECR 1279). The similarity of the special surcharge with the measure which was at issue in that case is striking. In that instance as well the factor giving rise to the proceedings was the increase in the Italian price for sugar after a new rate of exchange had been fixed for the Italian lira. The object of the measure was to equalize prices by ‘skimming off’ the increase in value which holders of stocks could expect. It was intended to be used for additional aid to beet producers. In addition exceptions were made for certain sugar processors with regard to stocks held which were to be used for immediate processing. It is however important that the object of that case was a measure adopted at Community level. It is further relevant that in that case the fact was criticized that the adoption of essential basic rules had been left to the national authorities. As the article which was there at issue, Article 37 of Regulation No 1009/67, corresponds to Article 33 of Regulation No 3330/74, it may be deduced that in such circumstances the Member States cannot act independently but that it is for the Community authorities to fix the essential basic rules.
                        The abovementioned Article 33 provides that:
                        ‘The requisite provisions to prevent the market in sugar being disturbed as a result of an alteration in price levels at the change-over from one marketing year to the next may be adopted in accordance with the procedure laid down in Article 36.’
                        It is therefore probably correct that its main purpose is to avoid disturbances affecting the supply to the market. In view of this it is no doubt necessary to adopt appropriate measures in good time in order that holders of stocks may be deterred from hoarding excessive amounts of sugar. However I would take the view that this is not an exhaustive statement of the sense of Article 33 of Regulation No 3330/74. Disturbances may also appear in other forms, for example with regard to the price structure, which can be endangered by supplies of sugar from the preceding marketing year in respect of which lower production costs were applicable. From this point of view it is correct that Article 33 can certainly be applied even after the beginning of a marketing year. As the Commission correctly emphasized, Article 33 should by no means be interpreted restrictively but broadly. This is evidenced not only by the preamble to Regulation No 3330/74 which makes a general reference to the necessity for certain transitional measures on the change-over from one sugar marketing year to the next. It is also relevant that with regard to the corresponding provision in Regulation No 1009/67 the judgment in Case 23/75 emphasized that under that provision the Commission has extensive power, the limits of which must be judged rather with regard to the basic general objectives of the organization of the market than in terms of the literal meaning of the enabling words. Properly understood Article 33 of Regulation No 3330/74 should be interpreted as meaning that whenever on the change-over from one marketing year to another alterations in the level of prices entail problems the necessary solutions must be sought at Community level.
                        In addition it should not be forgotten that the alteration in the level of prices in Italy at the beginning of the 1976/77 marketing year was the result of a modification of the rate of exchange of the lira determined by the Council of Ministers. It can certainly not be admitted that the effect of such measures should be partially nullified by purely national rules. To act otherwise would necessarily amount to accepting divergent development of the common market. In addition the fact that such national measures constitute derogation from the system of the organization of the markets entrusted to the Community becomes clear if one bears in mind the connexion with the monetary compensation which applies for imports from other Member States and which is determined by the Community. A further factor which must be borne in mind and which also supports the powers of the Community is that in adopting such measures it is for the Community institutions to determine the use of the revenue within the context of the common agricultural policy and (I here recall once again the proceedings in Case 23/75) to provide for additional support for agricultural producers.
                        In view of all this and taking account of the fundamental principle behind Community agricultural law whereby the Member States only lay down the detailed rules of implementation within the context of the common organizations of the markets but are not empowered to add anything substantial to the common organizations it must be concluded that the introduction of a special surcharge on the change-over from one marketing year to another is a typical measure under the common organization of the markets and is thus removed from the powers of the Member States. In this respect unilateral action is no longer possible; if it is felt that transitional measures are necessary to avoid injustice the only possibility is to take initiatives at Community level and to seek a solution in accordance with the procedure laid down by Community law.
                     
                  
                        (c)
                     
                     
                        In consideration of these conclusions in respect of the second part of the questions in Case 77/76 I do not find it necessary to examine Article 95 of the EEC Treaty in this respect as well — at least in so far as the special surcharge is imposed on imported sugar. For the same reason I do not find it necessary to make any additional observations concerning the prohibition on discrimination and the circumstance that the special surcharge was introduced with immediate effect, which caused the plaintiff to make reference to a failure to comply with the prohibition on measures having retroactive effect.
                        In order to ensure that the examination is comprehensive and also in order to place the national court in a position to draw conclusions from the points raised it is in any event still appropriate to add that the national court can certainly appraise the points made in the context of the national judicial proceedings. In other words it is possible for individuals concerned to rely on the inadmissibility of the national measure which results from directly applicable provisions of a Community regulation. According to the factual circumstances and the provisions of national law this may produce the result either that the charge at issue need not be paid or, if it has already been paid, that it must be refunded. In this connexion the remarks made with regard to the first question hold good in this instance as well.
                     
                  
         
               6.
            
            
               In conclusion therefore the following answers may be given to the questions raised in Cases 77/76 and 105/76:
               
                        (a)
                     
                     
                        A national charge which is imposed on both home-produced and imported products in accordance with the same criteria can only be regarded as a charge having effects equivalent to a customs duty if it is exclusively intended to finance activities which specifically benefit the domestic products subject to the charge, if the domestic products bearing the charge are identical to the domestic products receiving the benefit and if the charge imposed on the national product is counterbalanced in its entirety by the benefit. In addition even when the relief is covered by the provisions of Community law relating to aid, such charges are to be examined in the light of Article 95 of the EEC Treaty which is also directly applicable and which gives individuals rights which national courts must protect. In this respect where Article 95 is applicable it is for the national courts to determine whether the charge may not be imposed or, as the case may be, must be refunded in its entirety or only in so far as the imported product is subject to a higher charge.
                     
                  
                        (b)
                     
                     
                        If the level of prices in the Community expressed in national currency is modified the necessary measures on the change-over from one sugar marketing year to another to avoid disturbances of the market and to ensure equalization of prices in accordance with Article 33 of Regulation No 3330/74 may only be adopted by the Commission in accordance with the procedure laid down in the abovementioned regulation. Individuals may rely on the abovementioned provisions before the courts in order to claim that compensatory amounts fixed by exclusively national measures which fail to comply with the abovementioned provisions are not payable.
                     
                  
         (
            1
         )	Translated from the German.