Kjell Karlsson and Others.
Date: 2000-04-13
27 In so far as the Swedish court considers that the additional levy scheme for milk ceased to include rules governing the initial allocation of milk quotas for national producers when Regulation No 857/84 was repealed by Regulation No 3950/92, it is for the Member States, by virtue of Article 5 of the Treaty and in accordance with the general principles on which the Community is based and which govern relations between the Community and the Member States, to ensure that Community regulations are implemented within their territory. In so far as Community law, including its general principles, does not include common rules to that effect, the national authorities when implementing such regulations act in accordance with the procedural and substantive rules of their own national law (see, inter alia, Case C-285/93 Dominikanerinnen-Kloster Altenhohenau v Hauptzollamt Rosenheim [1995] ECR I-4069, paragraph 26).
32 Apart from the general principles of Community law, the Swedish legislation is therefore governed only by the requirements imposed by Regulation No 3950/92 as amended by the Act of Accession, and Articles 3 to 5 of the regulation as amended show clearly that it contains no rule designed to govern the initial allocation of milk quotas. The regulation is based in fact, as is demonstrated inter alia by Article 4 thereof as amended by the Act of Accession, on the premiss that milk quotas have already been allocated in all the Member States with the exception of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden prior to the entry into force of the regulation, in the Republic of Austria and in the Republic of Finland by 1 April 1995 and in the Kingdom of Sweden by 1 April 1996.
35 Even if when making the first distribution of quotas Member States enjoy a wide discretion in ensuring the implementation of Community rules within their territory, the Court has consistently held that the national rules they adopt must be reconciled with the need to apply Community law uniformly so as to avoid unequal treatment of traders (Dominikanerinnen-Kloster Altenhohenau, paragraph 26). Similarly, as the Advocate General emphasised in point 36 of his Opinion, Member States must be guided by the specific aims of the common agricultural policy where the Community legislation whose implementation in the national territory they are endeavouring to ensure falls within the sphere of that policy.
37 In addition, it should be remembered that the requirements flowing from the protection of fundamental rights in the Community legal order are also binding on Member States when they implement Community rules. Consequently, Member States must, as far as possible, apply those rules in accordance with those requirements (Case C-2/92 Bostock [1994] ECR I-955, paragraph 16).
39 The second subparagraph of Article 40(3) of the Treaty, which prohibits all discrimination in the context of the common agricultural policy, is merely a specific expression of the general principle of equal treatment, which requires that comparable situations not be treated differently and different situations not be treated alike unless such treatment is objectively justified (Case 203/86 Spain v Council [1988] ECR 4563, paragraph 25, and Case C-15/95 EARL de Kerlast [1997] ECR I-1961, paragraph 35).
Calculation based on the average quantities delivered between 1991 and 1993
45 However, it is well-established in the case-law of the Court that restrictions may be imposed on the exercise of those rights, in particular in the context of a common organisation of a market, provided that those restrictions in fact correspond to objectives of general interest pursued by the Community and do not constitute, with regard to the aim pursued, disproportionate and unreasonable interference undermining the very substance of those rights (Case 5/88 Wachauf [1989] ECR 2609, paragraph 18).
53 However, any unequal treatment of producers in a Member State compared with those in other Member States which are the result, as in this case, simply of divergencies between the legislations in those States does not entail discrimination of the kind prohibited by Article 40(3) of the Treaty if the national legislation at issue applies to all producers concerned on the basis of objective criteria (see, to that effect, Case 308/86 Lambert [1988] ECR 4369, paragraphs 21 and 22).
The requirement that production be continuous
54 As regards the refusal to grant Mr Torarp a milk quota on the ground that he had interrupted deliveries, it should be remembered at the outset that it is for the national court alone to assess the scope of the national provisions and the manner in which they must be applied (see, for example, Case C-194/94 CIA Security International v Signalson and Securitel [1996] ECR I-2201, paragraph 20). Consequently, the application of the national provision in question in Mr Torarp's case, and in particular the reasons for which the Swedish authorities refused him a milk quota, cannot be reviewed by the Court in proceedings under Article 177 of the Treaty.
55 As indicated by the Advocate General in points 60 and 61 of his Opinion, the Court has held that national rules governing the initial allocation of milk quotas which do not permit certain kinds of accident to be taken into account, so that a producer who has suffered such an accident which has appreciably reduced his milk production during the reference period is given a lower milk quota than that to which he would have been entitled had the accident not occurred, are not contrary to the principle of non-discrimination - or, moreover, the principle of the protection of legitimate expectations (Case 84/87 Erpelding v Secrétaire d'État à l'Agriculture et à la Viticulture) [1988] ECR 2647, paragraphs 15 to 21).
57 By contrast, the decisions of the Court of Justice show that milk quotas may be refused for producers seeking them not in order to resume marketing milk on a permanent basis but in order to obtain a purely financial advantage therefrom, relying on the market value acquired by the milk quota in the meantime (see, inter alia, Case C-44/89 Georg von Deetzen v Hauptzollamt Oldenburg [1991] ECR I-5119, Von Deetzen II, paragraph 24). In order to prevent speculation by seeking a milk quota for the sole purpose of selling it to someone else, therefore, the requirement that there be special grounds enables the national authorities to measure the producer's seriousness of intent and genuine capacity to effectively resume milk deliveries.
Observance of the principle of proportionality
58 As regards the restriction on the exercise of fundamental rights attributed to the fixing of milk quotas inter alia for new producers and producers who have increased production at a level lower than their production capacity, it should be remembered that when a Member State imposes restrictions on the exercise of fundamental rights it must observe the principle of proportionality. In accordance with that principle, the restriction must not constitute, having regard to the aim pursued, disproportionate and unreasonable interference undermining the very substance of those rights (Wachauf, paragraph 18).
63 Those complaints cannot be upheld. The principle of the protection of legitimate expectations may be relied upon as against Community rules only to the extent that the Community itself has previously created a situation which can give rise to a legitimate expectation (Case C-22/94 Irish Farmers Association and Others v Minister for Agriculture, Food and Forestry, Ireland, and the Attorney General [1997] ECR I-1809, paragraph 19). Analysis of the national legislation at issue in the main proceedings has already shown that the relevant Community rules cannot have had such an effect.