Federal Republic of Germany v Commission of the European Communities.
Date: 1990-06-12
13 In that connection, it should be observed that it is for all the authorities of the Member States, whether it be the central authorities of the State or the authorities of a federated State, or other territorial authorities, to ensure observance of the rules of Community law within the sphere of their competence . However, it is not for the Commission to rule on the division of competences by the institutional rules proper to each Member State, or on the obligations which may be imposed on federal and Laender authorities respectively . It may only verify whether the supervisory and inspection procedures established according to the arrangements within the national legal system are in their entirety sufficiently effective to enable the Community requirements to be correctly applied .
14 Consequently, there is no need to ascertain whether the Federal Government did give, as it maintains, adequate instructions to the Laender, but it is necessary to examine the applicant' s submissions in the light of the Commission' s criticisms relating to the absence of detailed rules for ensuring observance of the conditions laid down in the Community legislation, the lack of major administrative inspections and the lack of actual supervision of the subordinate implementing authorities, the lack or inadequacy of specific instructions to officials entrusted with on-the-spot inspections, the absence of any provision as to the frequency with which inspections are to be carried out and the absence of any written report on on-the-spot inspections carried out and their results . Those obligations are said to be minimum requirements under the provisions applicable in the matter .
16 In that connection, it should be emphasized that, even if the Community rules mentioned above do not expressly require Member States to introduce supervisory measures and inspection procedures such as those mentioned by the Commission, nevertheless that obligation may be implied from the fact that, under the rules in question, it is for the Member States to apply the arrangements for the premiums in issue and to organize a system of inspection and supervision .
17 More specifically, it should be pointed out that Article 8 of Council Regulation ( EEC ) No 729/70 of 21 April 1970 on the financing of the common agricultural policy ( Official Journal, English Special Edition 1970 ( I ), p . 218 ), imposes on Member States the general obligation to take the measures necessary to satisfy themselves that the transactions financed by the Fund are actually carried out and are executed correctly, to prevent and deal with irregularities and to recover sums lost as a result of irregularities or negligence . On the other hand, Article 9 of that regulation provides that Member States are to make available to the Commission all information required for the proper working of the fund and are to take all suitable measures to facilitate the supervision which the Commission may consider it necessary to undertake .
18 In addition to those general provisions, it should be pointed out that, with regard to premiums in favour of sheepmeat producers, Article 5 of Regulation No 3007/84, mentioned above, provides that before the expiry of the period of 100 days, mentioned above, "... the competent authorities designated by the Member States shall ensure administrative supervision supplemented by means of systematic or random inspection visits to check the number of eligible ewes stated in the application for a premium ."
19 As regards premiums for the maintenance of the suckler cow herd, Article 4(1 ) of Commission Regulation ( EEC ) No 1244/82 of 19 May 1982 laying down detailed rules implementing the system of premiums for maintaining suckler cows ( Official Journal 1982, L 143, p . 20 ), imposes on the competent authorities designated by each Member State the obligation to carry out administrative checks supplemented by random or, if necessary, systematic on-the-spot checks .
20 With particular regard to the correct utilization of Community resources, it is clear from those provisions, viewed in the light of the obligation of faithful cooperation with the Commission laid down in Article 5 of the Treaty, that Member States are required to set up comprehensive administrative checks and on-the-spot inspections thus guaranteeing the proper observance of the substantive and formal conditions for the grant of the premiums in question .
21 If no comprehensive system of checks exists or if the system introduced by a Member State is defective to the point of giving rise to doubts as to compliance with the conditions imposed on the grant of the premiums in question, the Commission is entitled to disallow certain expenditure incurred by the Member State in question .
23 Nevertheless, it should be stated that the Commission is obliged on each occasion to give reasons for its decision finding an absence of, or defects in, inspection procedures operated by the Member State in question .
27 Without contradicting those findings by producing evidence, the applicant government merely contends that administrative checks were in fact carried out, as well as on-the-spot inspections, and that the failure to draw up written reports proves that the officials entrusted with carrying out the checks did not find any irregularities, since written reports were drawn up only when necessary, namely in the case of irregularities .
28 In that connection it should be stated that the applicant State has not been able to show that the Commission' s findings were inaccurate . Those findings are capable of giving rise to serious doubts as to the existence of an adequate and effective series of supervisory measures and inspection procedures as regards the conditions for the grant of premiums in the Land in question .
35 The applicant disputes that it was under an obligation to introduce the rules mentioned by the Commission .
42 That approach cannot be accepted . In fact those individual cases in which premiums were wrongly granted merely constitute an additional factor in support of the Commission' s allegation that, in the two aforementioned Laender, an effective set of measures for supervising and checking compliance with the conditions for the grant of the premiums did not in fact exist .