1. This reference for a preliminary ruling concerns the interpretation of the second subparagraph of Article 11(1) of Commission Regulation (EEC) No 3665/87 of 27 November 1987 laying down common detailed rules for the application of the system of export refunds on agricultural products (OJ 1987 L 351, p. 1), as amended by Commission Regulation (EC) No 2945/94 of 2 December 1994 (OJ 1994 L 310, p. 57).
2. The reference was made in the course of proceedings between Dachsberger & Söhne GmbH, a company registered under Austrian law, and the Zollamt Salzburg, Erstattungen (Salzburg Customs Office, Refunds), concerning the export of pigmeat outside the European Community. Legal context Community legislation
3. As a preliminary point, it must be noted that, since the case in the main proceedings concerns the payment of export refunds in respect of the export of pigmeat outside the Community which was the subject-matter of a declaration in January 1999, the reference for a preliminary ruling must be examined in the light of Regulation No 3665/87, as amended by Commission Regulation (EC) No 495/97 of 18 March 1997 (OJ 1997 L 77, p. 12; ‘Regulation No 3665/87’).
4. Article 3 of Regulation No 3665/87 provides: ‘1. The day of export means the date on which the customs authority accepts the export declaration in which it is stated that a refund will be applied for. 2. The date of acceptance of the export declaration shall determine: (a) the rate of the refund where the refund is not fixed in advance; (b) any adjustments to be made to the rate of the refund where it is so fixed. 3. Any other act having the same effect in law as the acceptance of the export declaration shall be deemed to be equivalent to such acceptance. 4. The day of export shall be used to establish the quantity, nature and characteristics of the product exported.
5. The document used for export to enable products to qualify for a refund must include all information necessary for the calculation of the amount of the refund, and in particular: (a) a description of the products in accordance with the nomenclature used for refunds; (b) the net mass of the products or, where applicable, the unit of measurement to be taken into account in calculating the refund; ... ...
6. At the time of such acceptance, or of such equivalent act, the products shall be placed under customs control until they leave the customs territory of the Community.’ 5. Article 11(1) of Regulation No 3665/87 relates to the recovery of unduly paid amounts of export refunds and to penalties. The first to third and seventh subparagraphs of Article 11(1) are worded as follows: ‘1. Where it is found that an exporter, with a view to the grant of an export refund, has requested a refund in excess of that applicable, the refund due for the relevant exportation shall be the refund applicable to the actual exportation reduced by an amount equivalent to: (a) half the difference between the refund requested and the refund applicable to the actual exportation; (b) twice the difference between the refund requested and the refund applicable, if the exporter has intentionally supplied false information. The refund requested shall be deemed to be the amount calculated from the information supplied pursuant to Article 3 or Article 25(2). Where the rate of refund varies according to destination, the differentiated part of the refund requested shall be calculated using the particulars of quantity, weight and destination provided pursuant to Article 47. The sanction referred to in point (a) of the first subparagraph shall not apply: (a) in the case of force majeure ; (b) in exceptional cases where the exporter, on his own initiative, immediately after becoming aware that the refund requested is excessive, notifies the competent authority thereof in writing, unless the competent authority has informed the exporter that it intends to examine the request or the exporter has otherwise become aware of this intention, or the competent authority has already established that the refund requested was incorrect; (c) in cases of obvious error as to the refund requested, recognised by the competent authority; (d) in cases where the request for the refund is in accordance with Commission Regulation (EC) No 1222/94, and in particular Article 3(2) thereof, and has been calculated on the basis of the average quantities used over a specified period; (e) in case of adjustment of the weight in so far as the deviation in the weight is due to a difference in the weighing method applied. … The sanctions shall not apply simply where the refund requested is higher than the refund applicable pursuant to the application of Article 2a(2), Article 20(3), Article 33(2) and/or Article 48.’ 6. Article 16(1) of Regulation No 3665/87, in Section 2 of Title 2 of that regulation, entitled ‘Differentiated refunds’, provides that, where the rate of refund varies according to destination, payment of the refund is to be dependent upon the additional conditions laid down under Articles 17 and 18 of that regulation, which are included in the same section.
7. Under Article 17(1) of Regulation No 3665/87, the product must, as a rule, have been imported in the unaltered state into the non-member country or one of the non-member countries for which the refund is prescribed within 12 months following the date of acceptance of the export declaration. Pursuant to Article 17(3) of that regulation, a product is to be considered to have been imported when it has been cleared through customs for release for consumption in the non‑member country concerned.
8. Article 18(1) of that regulation lists the documents which are accepted as proof that the product has been cleared through customs for release for consumption in a non-member country.
9. Article 20(1) of Regulation No 3665/87 provides for a derogation from Article 16 thereof, by way of which a part of the refund is to be paid upon proof being furnished that the product has left the customs territory of the Community.
10. Article 20(2) of that regulation provides that that part is to be equal to the amount of the refund which the exporter would receive if his product reached a destination for which the lowest rate of refund had been fixed, the non-fixing of a rate being regarded as the lowest rate.
11. Article 20(3) of that regulation provides: ‘Where the destination indicated in box 7 of the licence issued comprising advance fixing of the refund has not been observed: (a) if the rate of refund corresponding to the actual destination is equal to or greater than the rate of refund for the destination indicated in box 7, the rate of refund for the destination indicated in box 7 shall apply; (b) if the rate of refund corresponding to the actual destination is less than the rate of refund for the destination indicated in box 7, the refund to be paid shall be: - that resulting from the application of the rate corresponding to the actual destination, - reduced, save in the case of force majeure , by 20% of the difference between the refund resulting from the destination indicated in box 7 and the refund for the actual destination. For the purposes of applying the first subparagraph, the rates of refund to be taken into consideration shall be those valid on the day on which the licence application is submitted. Where the provisions of the first and second subparagraphs and of Article 11 apply to one and the same export operation, the amount resulting from the first subparagraph shall be reduced by the penalty referred to in Article 11.’
12. Article 47 of Regulation No 3665/87, in Title 4 thereof entitled ‘Procedure for payment of the refund’, is worded as follows: ‘1. The refund shall be paid only on application by the exporter and shall be paid only by the Member State in whose territory the export declaration was accepted. Application for the refund shall be made either: (a) in writing; Member States may prescribe a special form to be used for this purpose; or (b) using computerised systems, in accordance with detailed rules to be adopted by the competent authorities and after approval by the Commission. ... 2. Except in cases of force majeure , the documents relating to payment of the refund or release of the security must be submitted within 12 months following the date of acceptance of the export declaration. …’ National legislation
13. Since 1 April 1998, the Austrian legislation has provided that the information corresponding to the application for payment provided for in Article 47(1) of Regulation No 3665/87 can be set out directly in the export declaration. The factual background to the case in the main proceedings and the questions referred for a preliminary ruling
14. On 18 January 1999, the appellant in the main proceedings gave notice of the export from the Community, showing ‘Russia’ as the destination country, of domestic swine meat in the form of frozen whole or half carcases, under tariff heading 0203 21 10 9000, and at the same time applied in the export declaration for payment of an export refund.
15. The export licence comprising advance fixing of the refund, submitted when the meat was cleared for export, shows the date of validity of the refund fixed in advance as 14 January 1999. Under Commission Regulation (EC) No 2634/98 of 8 December 1998 fixing the export refunds on pigmeat (OJ 1998 L 333 p. 24), the refund rates applicable at that time in respect of the tariff heading at issue in the main proceedings, depending on the destination, were EUR 20 /100kg net weight for the Republic of Bulgaria, the Czech Republic, the Republic of Estonia, the Republic of Latvia, the Republic of Lithuania, the Republic of Hungary, the Republic of Poland, Romania, the Republic of Slovenia and the Slovak Republic, EUR 70/100kg net weight for the Russian Federation, and EUR 40/100kg net weight for other destinations.
16. On 18 February 1999, a customs clearance document drawn up by the Russian authorities and a copy of a consignment note were presented to the Austrian payment office, the Zollamt Salzburg, Erstattungen. By notice of 15 March 1999 the payment office granted the export refund which had been applied for.
17. However, after having found that the customs clearance document presented as proof that the products had been cleared through customs for release for consumption in Russia was not genuine, the Zollamt Salzburg, Erstattungen, by decision of 14 February 2002, demanded the repayment of the differentiated part of the export refund granted and also imposed a penalty on the appellant in the main proceedings under Article 11(1) first subparagraph (a) of Regulation No 3665/87. Inasmuch as it was proved that the product concerned had left the customs territory of the Community, the refund had in fact been correctly granted only in respect of the amount of the basic refund.
18. After failing in the first instance proceedings on the application for review, the appellant in the main proceedings lodged a complaint on 27 February 2006, on which the Unabhängiger Finanzsenat, Außenstelle Graz (Independent Tax Tribunal, Graz), is required to rule.
19. Before the referring court, the appellant in the main proceedings challenges the proportionality of the penalty imposed upon it. In this connection, that court observes that the Court, in Case C-210/00 Käserei Champignon Hofmeister [2002] ECR I-6453, confirmed the compatibility with the principle of proportionality of the system of penalties laid down in Article 11(1) first subparagraph (a) of Regulation No 3665/87. The referring court however considers that doubt remains as to whether the penalty imposed is lawful and seeks to ascertain what the relevant date is, in the case of a differentiated refund, in order to determine the refund requested within the meaning of the second subparagraph of Article 11(1) of Regulation No 3665/87.
20. Accordingly, the Unabhängiger Finanzsenat, Außenstelle Graz, decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling: ‘1. Is the second sentence of the second subparagraph of Article 11(1) of [Regulation No 3665/87], which provides that, for the calculation of the requested refund in the case of a differentiated refund, “the differentiated part of the refund requested shall be calculated using the particulars of quantity, weight and destination provided pursuant to Article 47”, to be interpreted as meaning that the expression “particulars of quantity, weight and destination provided pursuant to Article 47” refers to the particulars in the specific application made pursuant to Article 47(1), with the result that the differentiated part of the refund is requested only at the time of presentation of the application within the meaning of Article 47(1)? 2. If the reply to the first question i s in the affirmative, the question arises as to whether, if the request for payment pursuant to Article 47(1) of [Regulation No 3665/87] is already to be submitted in “the document used for export to enable products to qualify for a refund” (here, the export declaration), the abovementioned provision is to be interpreted as meaning that the calculation of the refund requested in relation to the differentiated part is to be made using the particulars in the export declaration, with the result that the differentiated part of the refund is requested also with the export declaration. 3. If the reply to the first question is in the negative, the question arises as to whether the abovementioned provision is to be interpreted as meaning that the calculation of the refund requested in relation to the differentiated part is to be made using the documents to be presented in accordance with Article 47 of [Regulation No 3665/87], with the result that the differentiated part of the refund is requested only at the time of presentation of the “documents relating to payment” within the meaning of Article 47(2) of [Regulation No 3665/87]. 4. If the reply to the third question is in the affirmative, the question arises as to whether the abovementioned provision is to be interpreted as meaning that, for the purpose of requesting the differentiated part of the refund, it is sufficient to present such documents within the meaning of Article 47(2) of [Regulation No 3665/87], even if they are defective, with the consequence in law that the penalty provision of Article 11 of [Regulation No 3665/87] is applicable also in relation to the differentiated part of the refund.’ The questions referred The first and third questions
21. By its first and third questions, which should be examined together, the referring court is essentially asking whether the reference in the second sentence of the second subparagraph of Article 11(1) of Regulation No 3665/87, according to which ‘the differentiated part of the refund shall be calculated using the particulars of quantity, weight and destination provided pursuant to Article 47’, must be interpreted as meaning that, in the case of a differentiated refund, the differentiated part of the refund is requested at the time of presentation of the application provided for in Article 47(1) of Regulation No 3665/87 or of the documents relating to payment of the refund provided for in Article 47(2) of that regulation.
22. As a preliminary point, it is necessary to recall the arrangements for payment of an export refund as they follow from Regulation No 3665/87.
23. First, the exporter must present the document referred to in Article 3(5) of Regulation No 3665/87, by which he shows his intention to export agricultural products and obtain a refund.
24. In this respect, the Court has held that the information referred to in Article 3 of Regulation No 3665/87 is used not only in the mathematical calculation of the exact amount of the refund but rather, and above all, to ascertain whether a right to that refund exists or not and to trigger the system of checks of the request for refund which may lead to the imposition of a penalty in accordance with Article 11(1) of that regulation (see, to that effect, Case C‑385/03 Käserei Champignon Hofmeister [2005] ECR I-2997, paragraphs 22, 29 and 36; Case C-309/04 Fleisch‑Winter [2005] ECR I‑10349, paragraph 41; and, by analogy, Case C-27/05 Elfering Export [2006] ECR I-3681, paragraphs 25 and 27).
25. Secondly, the exporter must, in accordance with Article 47(1) of Regulation No 3665/87, make an application for payment by which he expressly informs the customs authorities that he seeks payment of the refund.
26. In this connection, the Court has already held that that application for payment is a technical procedural document which the exporter must produce to obtain payment of the refund. That application does not constitute the legal basis of entitlement to such a payment, even though it is a condition precedent to payment of the refund (see, to that effect, Käserei Champignon Hofmeister , paragraphs 26 and 27, and Fleisch‑Winter , paragraph 40).
27. In the light of those considerations, the Court has held that, for a non‑differentiated refund, the amount of the refund requested for the purpose of the first and second subparagraphs of Article 11(1) of Regulation No 3665/87 is calculated solely on the basis of the document referred to in Article 3(5) of that regulation, that is, the export declaration or another document used for export (see, to that effect, Käserei Champignon Hofmeister , paragraphs 22 and 23). Incorrect information contained in that document, which is capable of leading to a refund in excess of the refund applicable, gives rise to the imposition of the penalty prescribed by the first and second subparagraphs of Article 11(1) of Regulation No 3665/87 (see, to that effect, Käserei Champignon Hofmeister , paragraph 36 and operative part).
28. As regards a differentiated refund, Article 20(1) and (2) of Regulation No 3665/87 provides for payment of the basic refund, calculated according to the lowest rate of the refund applicable on the day of export, as soon as the exporter has provided proof that the product has left the customs territory of the Community. Payment of the differentiated part of the refund is itself subject to the additional conditions set out in Articles 17 and 18 of that regulation. The exporter must prove, within 12 months following the date of acceptance of the export declaration, that the product has been imported into the non-member country or one of the non-member countries for which the refund is prescribed by providing proof that the product has been cleared through customs for release for consumption in that country.
29. It must therefore be examined whether, in the case of a differentiated refund, the reference in the second sentence of the second subparagraph of Article 11(1) of Regulation No 3665/87 to the particulars provided pursuant to Article 47 of that regulation means that the differentiated part of the refund is requested not at the time the document referred to in Article 3(5) of Regulation No 3665/87 is presented, but at the time of presentation of the application for payment or of the documents relating to payment of the refund provided for in Article 47 of Regulation No 3665/87.
30. The difference in the operation of Articles 3 and 47 of Regulation No 3665/87, as observed in paragraphs 23 to 27 of this regulation, does not depend on whether the refund is differentiated or non-differentiated.
31. It is apparent from Article 3(5) of Regulation No 3665/87 that the document referred to there must, whatever its title, ‘include all information necessary for the calculation of the amount of the refund’, including ‘in particular’, first, a description of the products concerned in accordance with the nomenclature used for refunds, secondly, the net mass or quantity of those products and, thirdly, in so far as is necessary for calculating the refund, particulars of the composition of those products. The Court has already held that the information mentioned in Article 5 constitutes a non-exhaustive list ( Fleisch-Winter , paragraph 29, and Elfering Export , paragraph 25). The term ‘in particular’ means that the Community legislature expressly mentions only some of that information. The expression ‘all information’ must thus encompass all information relating to the conditions subject to which the export refund is granted (see, as regards Article 5(4)(a) of Commission Regulation (EC) No 800/1999 of 15 April 1999 laying down common detailed rules for the application of the system of export refunds on agricultural products (OJ 1999 L 102, p. 11), which replaced Regulation No 3665/87, Elfering Export , paragraph 26).
32. Thus, Article 3(5) of Regulation No 3665/87 refers to all the information which is used to ascertain whether there is a right to a refund, including to the differentiated part of that refund. In the case of a differentiated refund, that information includes the non‑member country or non-member countries for which the refund is prescribed.
33. Article 47 of that regulation, for its part, lays down only the administrative formalities which the exporter must complete in order to obtain payment of the refund.
34. The reference, in the second sentence of the second subparagraph of Article 11(1) of Regulation No 3665/87, to the information provided pursuant to Article 47 of that regulation has neither the purpose nor the effect of changing the limited and purely procedural function accorded under that regulation to the application for payment referred to in Article 47(1) thereof and the documents relating to payment of the refund referred to in Article 47(2) thereof.
35. That reference merely allows, in the case of a differentiated refund, account to be taken of any variations in quantity, weight and/or destination of the products, which occurred during an export operation, after the acceptance of the export declaration. Those variations must be taken into account in order to determine whether a penalty should be imposed on the exporter and, if necessary, to calculate the amount of that penalty.
36. Article 11(1) of Regulation No 3665/87 provides for the imposition of a penalty on an economic operator who, whether or not intentionally, requests an export refund higher than that which is applicable to the actual exportation.
37. Where the rate of the refund varies according to the destination, the competent authorities must check that the products concerned have actually been imported into the non-member country or one of the non-member countries for which the refund was prescribed. They may rely, for that purpose, on the documents relating to payment of the refund and, specifically, on proof that the product has been cleared through customs for release for consumption. Those documents thereby enable the competent authorities to determine the amount of the refund applicable to the actual exportation.
38. Even if, for practical reasons, as is the case in the main proceedings, the export declaration and the application for payment may be made together, the differentiated refund, including the differentiated part, must be regarded as ‘requested’ within the meaning of Article 11(1) of Regulation No 3665/87 at the time of presentation of the document referred to in Article 3(5) thereof.
39. That interpretation of the second subparagraph of Article 11(1) of Regulation No 3665/87 is moreover consistent with the system of checks on requests for a refund and penalties established by that regulation.
40. A contrary interpretation would have the effect of making it possible validly to introduce, by the presentation of the application for payment or of the documents relating to payment of the refund, a request for a refund in respect of products which had already been exported or even already subject to checks.
41. Such a possibility would render entirely redundant not only Article 3 of Regulation No 3665/87, but also the process of checking the requests for a refund. Physical checks on products for which refunds have been requested are an important tool with which to combat irregularities and fraud in the area of export refunds. Therefore, in order to ensure that the purpose of the checks is fully secured, it is imperative that they take place after the filing by the exporter of a binding request for refund (see, to that effect, Käserei Champignon Hofmeister, paragraphs 27 and 28).
42. In addition, if the refund, including the differentiated part, could be requested within 12 months following the date of acceptance of the export declaration, the exporter would be able, even after the exportation, to amend his request for a refund at his convenience or depending on the result of any check, and thereby avoid any penalty. The dissuasive effect of the penalties provided for in Article 11(1) of Regulation No 3665/87 would therefore be to a large extent invalidated.
43. Admittedly, pursuant to the seventh subparagraph of Article 11(1) of Regulation No 3665/87, the penalties prescribed under that paragraph are not to apply where the refund requested is higher than the refund applicable pursuant to the application of Article 20(3) of that regulation. That latter provision provides, in the first subparagraph thereof, under (b), that, where the destination indicated in the export licence issued comprising advance fixing of the refund has not been observed and the rate of refund corresponding to the actual destination is less than the rate of refund for the destination indicated in that licence, the refund to be paid is to be that resulting from the application of the rate corresponding to the actual destination, reduced, save in the case of force majeure , by 20% of the difference between the refund resulting from the destination indicated in that licence and the refund for the actual destination.
44. However, as the Commission has pointed out, Regulation No 3665/87 does not make any specific provision for a situation, such as that at issue in the main proceedings, where the exporter proved that the products were exported outside the customs territory of the Community, but failed to establish that they were released for consumption in the non-member country or one of the non-member countries for which a refund is prescribed. In such a situation, in the absence of proof as to the ‘actual destination’ of the products at issue, Article 20(3) of that regulation is not applicable. Since, in such a case, the exporter must be regarded as having requested a refund in excess of that applicable, it is necessary to apply the penalty prescribed in the first subparagraph of Article 11(1) of Regulation No 3665/87, unless one of the conditions for exemption set out exhaustively in the third and seventh subparagraphs of Article 11(1) is fulfilled.
45. In the light of the foregoing, the answer to the first and third questions is that Article 11(1) of Regulation No 3665/87 must be interpreted as meaning that, in the case of a differentiated refund, the differentiated part of the refund is requested not at the time of presentation of the application provided for in Article 47(1) of Regulation No 3665/87 or of the documents relating to payment of the refund provided for in Article 47(2) of that regulation, but as soon as the document referred to in Article 3(5) of the regulation is presented. The inclusion in that document of information capable of leading to a refund in excess of the refund applicable and which is found to be incorrect gives rise, as a result, subject to the cases laid down in the third and seventh subparagraphs of Article 11(1) of that regulation, to the imposition of the penalty prescribed in the first and second subparagraphs of Article 11(1).
46. Having regard to the answer given to the first and third questions, there is no need to answer the second and fourth questions referred by the national court. Costs
47. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.