Pfeifer & Langen GmbH & Co. KG v Bundesanstalt für Landwirtschaft und Ernährung.
Date: 2015-06-11
20. Firstly, it is appropriate to recall that Regulation No 2988/95 introduces, in accordance with Article 1 thereof, ‘general rules … relating to homogenous checks and to administrative measures and penalties concerning irregularities with regard to [EU] law’ and, as is apparent from the third recital in the preamble to that regulation, in order to ‘[counter] acts detrimental to the [EU’s] financial interests … in all areas’ (see judgments in Handlbauer , C‑278/02, EU:C:2004:388, paragraph 31 ; Josef Vosding Schlacht-, Kühl- und Zerlegebetrieb and Others , C‑278/07 to C‑280/07, EU:C:2009:38, paragraph 20; and Pfeifer & Langen , C‑564/10, EU:C:2012:190, paragraph 36).
21. In that regard, Article 3(1) of Regulation No 2988/95 establishes a limitation period for proceedings of four years as from the time when the irregularity was committed or, in the case of continuous or repeated irregularities, the limitation period shall run from the day on which the irregularity ceases. However, under that provision, the sectoral rules may make provision for a shorter period which may not be less than three years.
23. That period is applicable both to the irregularities leading to the imposition of an administrative penalty, within the meaning of Article 5 of that regulation, and to irregularities, such as those at issue in the main proceedings, which are penalised by an administrative measure consisting of the withdrawal of the advantage wrongly obtained, in accordance with Article 4 of that regulation (see, to that effect, judgments in Handlbauer , C‑278/02, EU:C:2004:388, paragraphs 33 and 34; Josef Vosding Schlacht-, Kühl- und Zerlegebetrieb and Others , C‑278/07 to C‑280/07, EU:C:2009:38, paragraph 22; and Cruz & Companhia , C‑341/13, EU:C:2014:2230, paragraph 45).
24. Secondly, it must be borne in mind that the limitation period referred to in Article 3(1) of Regulation No 2988/95 seeks to ensure legal certainty for economic operators (see, to that effect, judgments in Handlbauer , C‑278/02, EU:C:2004:388, paragraph 40, and SGS Belgium and Others , C‑367/09, EU:C:2010:648, paragraph 68). Those operators must be in a position to determine which among their transactions are definitive and which may still be the subject of legal proceedings.
36. Firstly, it must be noted that it is apparent from the wording of the third subparagraph of Article 3(1) of Regulation No 2988/95 that the concept of ‘person in question’ designates the economic operator suspected of having committed the irregularities in respect of which an investigation was initiated or legal proceedings were brought, namely, here, Pfeifer & Langen.
38. That requirement must be regarded as satisfied where a set of facts lead to the conclusion that the person in question has effectively been made aware of those acts relating to investigation or legal proceedings. In the case of a legal person, that requirement is satisfied if the act in question has actually been brought to the attention of a person whose conduct may be ascribed, under national law, to that legal person, which it is for the referring court to ascertain.
40. By Question 1(b) and its third question, which it is appropriate to examine together, the referring court asks, in essence, whether the third subparagraph of Article 3(1) of Regulation No 2988/95 must be interpreted, firstly, as meaning that an act must relate to a specific irregularity committed by the operator and the adoption of a measure or administrative penalty in order to be classified as an ‘act relating to investigation or legal proceedings’, within the meaning of that provision and, secondly, whether a report, such as the final report at issue in the main proceedings, which assesses the results of an investigation into the suspicions of irregularities, without making any request for additional information addressed to the person in question concerning the transactions at issue, may constitute such an act.
41. As regards the concept of ‘act relating to investigation or legal proceedings’ within the meaning of the third subparagraph of Article 3(1) of Regulation No 2988/95, the Court has previously held that limitation periods, such as that at issue in the main proceedings, fulfil the function of ensuring legal certainty and that such a function would not be wholly fulfilled if that limitation period could be interrupted by any act relating to a general check by the national authorities which bears no relation to any suspicion concerning the existence of irregularities regarding sufficiently precisely circumscribed transactions (see judgment in SGS Belgium and Others , C‑367/09, EU:C:2010:648, paragraph 68).
42. However, when the national authorities send a person a report drawing attention to an irregularity in which that person is said to have played a part in connection with a specific operation, ask the person for further information concerning that operation or apply a penalty to the person in connection with that operation, those authorities adopt acts relating to investigation or legal proceedings concerning the irregularity which are sufficiently specific for the purposes of the third subparagraph of Article 3(1) of Regulation No 2988/95 (judgments in SGS Belgium and Others , C‑367/09, EU:C:2010:648, paragraph 69, and Chambre de commerce et d’industrie de l’Indre , C‑465/10, EU:C:2011:867, paragraph 61).
43. It follows therefrom that an act must set out with sufficient precision the transactions to which the suspicions of irregularities relate in order to constitute an ‘act relating to investigation or legal proceedings’, within the meaning of the third subparagraph of Article 3(1) of Regulation No 2988/95. That requirement for precision does not, however, require the act to state the possibility that a penalty or particular administrative measure may be imposed.
44. The referring court points out, nevertheless, that the judgments in SGS Belgium and Others (C‑367/09, EU:C:2010:648) and Chambre de commerce et d’industrie de l’Indre (C‑465/10, EU:C:2011:867) could be interpreted as meaning that a report, such as the final report at issue in the main proceedings, must necessarily contain a request for additional information addressed to the person in question in order to constitute an ‘act relating to investigation or legal proceedings’ within the meaning of the third subparagraph of Article 3(1) of Regulation No 2988/95.
47. Having regard to the foregoing, the answer to Question 1(b) and the third question is that the third subparagraph of Article 3(1) of Regulation No 2988/95 must be interpreted as meaning that an act must set out with sufficient precision the transactions to which the suspicions of irregularities relate in order to constitute an ‘act relating to investigation or legal proceedings’, within the meaning of that provision. That requirement for precision does not, however, require the act to state the possibility that a penalty or particular administrative measure may be imposed. It is for the referring court to ascertain whether the report at issue in the main proceedings satisfies that requirement.
The fourth and eighth questions
49. As a preliminary point, it must be borne in mind that, in accordance with the case-law of the Court, an irregularity is ‘continuous or repeated’ for the purposes of the second subparagraph of Article 3(1) of Regulation No 2988/95 where it is committed by an operator who derives economic advantages from a body of similar transactions which infringe the same provision of EU law (see judgment in Vonk Dairy Products , C‑279/05, EU:C:2007:18, paragraph 41).
53. Next, with regard to the classification of the irregularities at issue in the main proceedings, it is for the referring court to ascertain, in accordance with the rules of evidence of national law applicable to the main proceedings, provided that the effectiveness of EU law is not undermined, whether the elements constituting a continued or repeated irregularity, recalled in paragraph 49 of this judgment, are present (see, to that effect, judgment in Vonk Dairy Products , C‑279/05, EU:C:2007:18, paragraph 43). None the less, the Court may provide that court, on the basis of the information in the order for reference, with the points of interpretation which are likely to enable the referring court to give its ruling.
63. Firstly, it is apparent from both the wording and scheme of Article 3(1) of Regulation No 2988/95 that, in its fourth subparagraph, that provision sets an absolute limit applying to the time-bar of legal proceedings in respect of an irregularity, that limitation becoming effective at the latest on the day on which a period equal to twice the limitation period laid down in the first subparagraph thereof expires without the competent authority having imposed a penalty, except where the administrative procedure has been suspended in accordance with Article 6(1) of that regulation.
64. The limitation period laid down in the fourth subparagraph of Article 3(1) of Regulation No 2988/95 thus helps to reinforce the legal certainty of the economic operators, in accordance with the essential requirement referred to in paragraph 24 of this judgment, by preventing the limitation period of legal proceedings in respect of an irregularity from being extended indefinitely by repeated interrupting acts.
66. In accordance with the second subparagraph of Article 3(1) of that regulation, in the case of repeated irregularities, the limitation period runs from the day on which the irregularity ended. As has been recalled in paragraph 49 of this judgment, where in order to derive economic advantages therefrom, an operator carries out a body of similar transactions which infringe the same provision of EU law, those transactions must be regarded as forming a single continuous or repeated irregularity. Consequently, the concept of an ‘irregularity ceasing’ referred to in that provision must be understood as referring to the day on which the last transaction forming part of a single repeated irregularity ceased.
67. Accordingly, the date on which the national authorities became aware of an irregularity is irrelevant to the starting point of that limitation period. Apart from the fact that there is nothing in the wording of Article 3(1) of Regulation No 2988/95 enabling an inference to the contrary, it has already been pointed out, in paragraph 64 of the present judgment, that the national administration has a general obligation of due diligence in the verification of payments which it makes from the EU budget, which means that it must take steps to rectify irregularities promptly (see, to that effect, judgments in Z e Fu Fleischhandel and Vion Trading , C‑201/10 and C‑202/10, EU:C:2011:282, paragraph 44, and Cruz & Companhia , C‑341/13, EU:C:2014:2230, paragraph 62).
68. In those circumstances, to accept that the limitation period laid down in the fourth subparagraph of Article 3(1) of Regulation No 2988/95 does not begin to run until the administration has discovered those irregularities could encourage inertia on the part of the national authorities in bringing proceedings in respect of irregularities, whilst exposing operators, firstly, to a long period of legal uncertainty and, secondly, to the risk of no longer being in a position to prove at the end of such a period that the transactions in question were lawful (see, to that effect, judgments in Ze Fu Fleischhandel and Vion Trading , C‑201/10 and C‑202/10, EU:C:2011:282, paragraph 45, and Cruz & Companhia , C‑341/13, EU:C:2014:2230, paragraph 62).
72. It follows therefrom that, except in the latter case, the acts relating to investigation or legal proceedings adopted by the competent authority and notified to the person in question, in accordance with the third subparagraph of Article 3(1) of Regulation No 2988/95, do not have the effect of interrupting the limitation period laid down in the fourth subparagraph of Article 3(1) of that regulation.