1 IN THIS ACTION, FILED ON 24 JULY 1973, THE APPLICANT SEEKS COMPENSATION FOR THE DAMAGE CAUSED TO IT BY THE UNLAWFUL ACTS OF THE COUNCIL AND COMMISSION IN THAT, WITHIN THE FRAMEWORK OF THE COMMON ORGANIZATION OF THE MARKET IN OILS AND FATS ESTABLISHED BY REGULATION NO 136/66 OF THE COUNCIL OF 22 SEPTEMBER 1966 ( OJ L 172 OF 30 SEPTEMBER 1966, P . 3025 ) AN ADDITIONAL SUBSIDY WAS INTRODUCED BY REGULATION NO 876/67 OF THE COUNCIL OF 20 NOVEMBER 1967 ( OJ L 281 OF 21 NOVEMBER 1967, P . 7 ), WHICH WAS RENEWED FROM YEAR TO YEAR AND LIMITED TO COLZA AND RAPE SEED HARVESTED IN THE COMMUNITY AND PROCESSED IN ITALY . THE APPLICANT CLAIMS PAYMENT OF DM 735 924 DAMAGES REPRESENTING THE AMOUNT WHICH IT WOULD HAVE RECEIVED DURING THE YEARS 1969 TO 1972 IF THE ADDITIONAL SUBSIDY HAD BEEN GRANTED TO ALL THE COMMUNITY OIL MILLS ON THE BASIS OF THE SOLE CRITERION OF THEIR DISTANCE FROM THE PRODUCTION AREAS . THE REGULATIONS IN QUESTION CONSTITUTE AN INFRINGEMENT OF THE RULE PROHIBITING ANY DISCRIMINATION CONTAINED IN THE FIRST PARAGRAPH OF ARTICLE 7 AND THE SECOND PARAGRAPH OF ARTICLE 40 ( 3 ) OF THE EEC TREATY . ADMISSIBILITY
2 THE COUNCIL CHALLENGES THE ADMISSIBILITY OF THE ACTION BY REASON OF THE FACT THAT IT AIMS IN TRUTH NOT AT COMPENSATION FOR DAMAGES ARISING FROM ITS CONDUCT, BUT AT THE AMENDMENT OF A COMMUNITY REGULATION WHICH HAD BEEN JUDGED INADMISSIBLE IN A PREVIOUS ACTION WHICH THE APPLICANT HAD BROUGHT : CASE 164/73 HOLTZ V COUNCIL ( 1974 ) ECR P . 1 . TO ACCEPT THE ADMISSIBILITY OF THE ACTION WOULD FRUSTRATE THE CONTENTIOUS SYSTEM PROVIDED FOR BY THE TREATY AND IN PARTICULAR BY PARAGRAPH 3 OF ARTICLE 175 THEREOF WHICH GIVES INDIVIDUALS NO RIGHT TO BRING AN ACTION FOR FAILURE TO ISSUE A REGULATION .
3 HOWEVER, THE ACTION FOR DAMAGES PROVIDED FOR IN THE SECOND PARAGRAPH OF ARTICLE 215 OF THE TREATY WAS INCLUDED AS AN AUTONOMOUS FORM OF ACTION, WITH A PARTICULAR PURPOSE TO FULFIL WITHIN THE SYSTEM OF ACTIONS, AND SUBJECT TO CONDITIONS ON ITS USE BY ITS SPECIFIC NATURE .
4 IT WOULD BE CONTRARY TO THE AUTONOMY OF THIS ACTION AS WELL AS TO THE EFFICACITY OF THE GENERAL SYSTEM OF FORMS OF ACTION ESTABLISHED BY THE TREATY TO REGARD AS A GROUND OF INADMISSIBILITY THE FACT THAT IN CERTAIN CIRCUMSTANCES AN ACTION FOR DAMAGES COULD LEAD TO A RESULT SIMILAR TO THAT OF AN ACTION FOR FAILURE TO ACT UNDER ARTICLE 175 . SUCH AN ACTION DIFFERS FROM AN ACTION FOR FAILURE TO ACT IN THAT ITS END IS NOT THE ADOPTION OF A PARTICULAR MEASURE BUT COMPENSATION FOR DAMAGE CAUSED BY AN INSTITUTION IN THE PERFORMANCE OF ITS DUTIES .
5 THIS ACTION AIMS ONLY AT THE RECOGNITION OF A RIGHT TO COMPENSATION AND AS A RESULT TO A BENEFIT INTENDED TO HAVE EFFECT SOLELY WITH REGARD TO THE APPLICANT . THE ACTION IS THEREFORE ADMISSIBLE . SUBSTANCE
6 THE APPLICANT BASES ITS ACTION IN THE FIRST PLACE ON THE FACT THAT THE ADDITIONAL SUBSIDY GRANTED TO ITALIAN OIL MILLS CONSTITUTES DISCRIMINATION ON GROUNDS OF NATIONALITY AND INFRINGES THE FIRST PARAGRAPH OF ARTICLE 7 OF THE TREATY . THE APPLICANT STATES THAT, UNDER THE SECOND PARAGRAPH OF ARTICLE 40 ( 3 ) OF THE TREATY, WHICH APPLIES THE GENERAL PRINCIPLE SET OUT IN ARTICLE 7 TO AGRICULTURAL POLICY, IF DIFFERENT TREATMENT HAD BEEN ACCORDED TO THE ITALIAN OIL MILLS, NOT BY REASON OF THEIR NATIONALITY BUT BECAUSE OF THEIR DISTANCE FROM THE PRODUCTION AREAS, IT SHOULD HAVE ENJOYED THE SAME SUBSIDY AS THE OIL MILLS IN NORTHERN ITALY . THE APPLICANT DOES NOT BASE ITS ACTION ON THE FACT THAT THE COUNCIL AND THE COMMISSION HAVE RESPECTIVELY DECIDED AND PROPOSED ADDITIONAL SUBSIDY FOR ITALIAN OIL MILLS, BUT ON THE FACT THAT THIS RULE DOES NOT APPLY EQUALLY TO IT .
7 UNDER THE SECOND PARAGRAPH OF ARTICLE 215 OF THE TREATY AND THE GENERAL PRINCIPLES TO WHICH THIS PROVISION REFERS, COMMUNITY RESPONSIBILITY DEPENDS ON THE COINCIDENCE OF A SET OF CONDITIONS AS REGARDS THE UNLAWFULNESS OF THE ACTS ALLEGED AGAINST THE INSTITUTIONS, THE FACT OF DAMAGE, AND THE EXISTENCE OF A DIRECT LINK IN THE CHOIN OF CAUSALITY BETWEEN THE WRONGFUL ACT AND THE DAMAGE COMPLAINED OF . SINCE IT RELATES TO A LEGISLATIVE ACT WHICH INVOLVES THE CHOICE OF ECONOMIC POLICY, THE COMMUNITY IS NOT LIABLE FOR ANY DAMAGE SUFFERED BY INDIVIDUALS AS A CONSEQUENCE OF THIS ACT UNDER THE PROVISIONS OF ARTICLE 215, SECOND PARAGRAPH, OF THE TREATY, UNLESS A SUFFICIENTLY FLAGRANT VIOLATION OF A SUPERIOR RULE OF LAW FOR THE PROTECTION OF THE INDIVIDUAL HAS OCCURRED .
8 REGULATION NO 136/66/EEC OF THE COUNCIL OF 22 SEPTEMBER 1966, WHICH ENTERED INTO FORCE ON 1 OCTOBER 1966, HAS APPLIED SINCE 1 JULY 1967 TO COLZA AND RAPE SEED AND TO OIL PRODUCED THEREFROM . THIS REGULATION AIMS, BY MEANS OF A SYSTEM OF BASIC INTERVENTION PRICES AND DERIVED INTERVENTION PRICES, AT ALLEVIATING THE BURDEN OF TRANSPORT COSTS TO THE OIL MILLS FOR THE SEEDS OF COLZA PRODUCTS IN THE VARIOUS AREAS .
9 SINCE DIFFICULTIES AROSE IN ITALY ON THE OPENING OF THE INTER-COMMUNITY FRONTIERS ON THE COMING INTO FORCE OF REGULATION NO 136/66, IN PARTICULAR FROM THE FACT THE COLZA OIL PRODUCED IN FRANCE WAS AVAILABLE ON THE ITALIAN MARKET AT PRICES CONSIDERABLY LOWER THAN THOSE OF OIL PRODUCED IN ITALY, THE ITALIAN GOVERNMENT REQUESTED AUTHORITY FROM THE COMMISSION TO BRING IN PROTECTIVE MEASURES UNDER ARTICLE 226 OF THE TREATY .
10 ON THE COMMISSION REJECTING THIS REQUEST BY DECISION DATED 11 OCTOBER 1967, THE COUNCIL, BY REGULATION NO 876/67, ISSUED UNDER ARTICLE 36 OF REGULATION NO 136/66, INTRODUCED AN 'ADDITIONAL SUBSIDY' AMOUNTING TO 0.675 U.A . PER 100 KG OF SEED FOR 'COLZA AND RAPE SEED HARVESTED IN THE COMMUNITY WHICH IS SENT DURING THE COURSE OF THE 1967/68 MARKETING YEAR TO AN OIL MILL IN ITALIAN TERRITORY' IN ORDER TO BE PROCESSED . REGULATION NO 876/67 JUSTIFIES THE GRANT OF ADDITIONAL SUBSIDY ON THE GROUND THAT 'PENDING A MORE THOROUGH EXAMINATION OF THE CAUSES OF THE DIFFICULTIES ( ENCOUNTERED IN ITALY IN THE OIL SEED CRUSHING INDUSTRY ) AND OF PRODUCTION CONDITIONS IN THE COMMUNITY, THE SAID DIFFICULTIES CAN BE LESSENED DURING THE PRESENT MARKETING YEAR BY THE GRANT OF ( SUCH ) A SUBSIDY '.
11 THIS SUBSIDY WAS REPEATED FOR THE 1968/69 TO 1973/74 MARKETING YEARS BY REGULATIONS OF THE COUNCIL NOS 842/68 ( OJ L 152, P . 2 ), 1382/69 ( OJ L 178, P . 4 ), 1221/70 ( OJ L 141, P . 26 ), 1052/71 ( OJ 115, P . 6 ), 1336/72 ( OJ L 147, P . 7 ), AND 1357/73 ( OJ L 141, P . 30 ) WHICH HAVE BROUGHT THE AMOUNT TO 0.850 U.A . PER 100 KG AS REGARDS THE 1968 TO 1972 MARKETING YEARS AND TO 0.800 U.A . AS FROM THE 1972/73 MARKETING YEAR . WITH THE EXCEPTION OF THE LAST, THESE REGULATIONS ALL CONTAIN THE SAME RECITAL THAT 'AN EXAMINATION OF THE CAUSES OF THESE DIFFICULTIES ( THE DIFFICULTIES ENCOUNTERED IN ITALY ) AND OF THE PRODUCTION CONDITIONS IN THE COMMUNITY, ACCOUNT BEING TAKEN OF THE DEVELOPMENT PROSPECTS OF THE MARKET IN SEEDS, SHOWS THAT THE ADDITIONAL SUBSIDY SHOULD BE MAINTAINED FOR THE MARKETING YEAR' IN QUESTION . REGULATION NO 1357/73 PROVIDES 'WHEREAS, PENDING COMPLETION OF THE EXAMINATION OF THE PROBLEMS RAISED BY THE MOVEMENT OF OIL SEEDS WITHIN THE ENLARGED COMMUNITY, THE ADDITIONAL SUBSIDY SHOULD BE MAINTAINED FOR THE 1973/74 MARKETING YEAR '.
12 THE DEFENDANTS HAVE STATED THAT THE DIFFICULTIES WHICH THESE RULES AIM AT LESSENING ARE CAUSED IN PARTICULAR BY THE FACT THAT TRANSPORT COSTS OF 100 KG OF COLZA SEED FROM FRANCE TO ITALY ARE HIGHER THAN THAT OF THE 41 KG OF OIL WHICH THEY CONTAIN, SO THAT IN SPITE OF THE SYSTEM INTRODUCED BY REGULATION NO 136/66 TO OFFSET THE TRANSPORT COSTS OF SEED, FRENCH OIL COULD COME ONTO THE ITALIAN MARKET AT A LOWER PRICE THAN THAT OF OIL PRODUCED IN THE COUNTRY FROM SEED HARVESTED IN FRANCE . THE ADDITIONAL SUBSIDY IN QUESTION IS THUS INTENDED TO COMPENSATE FOR THE DISADVANTAGES IN COMPETITION CAUSED TO THE ITALIAN MILLS FAR FROM THE COMMUNITY PRODUCTION AREAS BY THE STRUCTURE OF THE COMMON ORGANIZATION OF THE MARKET .
13 THE OBJECTIVES REFERRED TO IN ARTICLE 40 OF THE TREATY, THAT IS THE ESTABLISHMENT OF A COMMON AGRICULTURAL POLICY AND A COMMON ORGANIZATION OF AGRICULTURAL MARKETS, PRESUPPOSES THE ADOPTION OF COMMON RULES AND CRITERIA AND THE CONSEQUENT EXCLUSION OF ANY DISCRIMINATION BASED ON THE NATIONALITY OR LOCALITY OF THE OIL MILLS . IN THIS LIGHT THE VARIOUS FACTORS IN THE COMMON ORGANIZATION OF THE MARKETS, PROTECTIVE MEASURES, AIDS, SUBSIDIES, ETC . MAY BE DISTINGUISHED ACCORDING TO THE AREAS AND OTHER CONDITIONS OF PRODUCTION OR CONSUMPTION ONLY IN TERMS OF CRITERIA OF AN OBJECTIVE NATURE WHICH ENSURE A PROPORTIONATE DISTRIBUTION OF ADVANTAGES AND DISADVANTAGES FOR THOSE CONCERNED WITHOUT DISTINGUISHING BETWEEN THE TERRITORY OF MEMBER STATES . ADDITIONAL SUBSIDIES LIMITED TO OIL MILLS ESTABLISHED IN ONE OF THE MEMBER STATES ARE THEREFORE IN GENERAL INCOMPATIBLE WITH THE OBJECTIVES OF THE COMMON AGRICULTURAL POLICY IN SO FAR AS THEY ARE NOT JUSTIFIED BY CIRCUMSTANCES SPECIAL TO THE WHOLE OF THE NATIONAL MARKET IN QUESTION .
14 AT ITS INITIATION HOWEVER THE COMMON ORGANIZATION OF THE MARKET MAY NOT COMPLETELY MEASURE UP TO THE OBJECTIVES LISTED IN ARTICLE 39 OF THE TREATY AND MAY CONTAIN GAPS CAPABLE OF ENDANGERING THE STABILITY OF THE MARKET IN A PART OF THE COMMUNITY . ALTHOUGH IT IS INCUMBENT UPON THE INSTITUTIONS RESPONSIBLE TO SEEK WITH ALL DUE DILIGENCE THE CAUSES OF SUCH DIFFICULTIES AND TO ADAPT THE REGULATIONS ON THE COMMON ORGANIZATION OF THE MARKETS AS SOON AS POSSIBLE TO REMEDY THE DEFECTS REVEALED, THEY ARE AT LIBERTY, IN THE MEANTIME, TO TAKE PROVISIONAL MEASURES, WHICH ARE LIMITED TO THOSE MEMBER STATES IN WHICH THE MARKET HAS BEEN MORE PARTICULARLY AFFECTED .
15 SUCH WOULD APPEAR TO HAVE BEEN THE CASE WITH REGARD TO REGULATION NO 876/67 AND THE REGULATIONS WHICH RE-ENACTED IT . ALTHOUGH THE EXPLANATION GIVEN BY THE DEFENDANTS, ACCORDING TO WHICH THE INTRODUCTION OF FRENCH OILS AT PRICES VERY MUCH LESS THAN THE COST PRICE OF ITALIAN OIL MILLS WAS DUE TO THE DIFFERENCE IN TRANSPORT COSTS OF THE OIL PROCESSED IN FRANCE IN RELATION TO THAT FROM COLZA SEED FROM FRENCH CENTRES OF PRODUCTION, IS NOT ALTOGETHER SATISFACTORY, IT IS HOWEVER APPARENT THAT THE INSTITUTION OF THE COMMON ORGANIZATION OF THE MARKETS IN OILS AND FATS HAS PRODUCED A NEW SITUATION PREJUDICIAL TO THE ITALIAN MARKET IN OIL PRODUCTS . THE COUNCIL COULD THEREFORE ISSUE A PROVISIONAL MEASURE INTENDED TO LESSEN THE DIFFICULTIES LIMITED TO THE ITALIAN OIL MILLS .
16 THE APPLICANT HAS NOT CLAIMED THAT AT THE TIME COMPARABLE DIFFICULTIES HAD ARISEN ON THE GERMAN MARKET, IN PARTICULAR IN SO FAR AS IT IS CONCERNED .
17 ALTHOUGH THE COUNCIL HAS THEREFORE NOT INFRINGED ARTICLE 40 ( 3 ) OF THE TREATY, IT MUST NEVERTHELESS BE ADMITTED THAT THE PROVISIONAL NATURE INHERENT IN SUCH A MEASURE RISKS DISAPPEARING AS SOON AS IT HAS SUCCEEDED IN EXCLUDING FOR ANY LENGTH OF TIME UNDERTAKINGS OF A MEMBER STATE FROM THE COMMON ORGANIZATION OF THE MARKET .
18 HAVING REGARD TO THE NATURE OF THE PROBLEMS INVOLVED, BY PUTTING AN END TO THE MEASURES AFTER THE 1973/74 MARKETING YEAR, THE COUNCIL HAS RESPECTED THEIR PROVISIONAL NATURE . THE ACTION IS THEREFORE NOT VALID IN LAW AND MUST BE REJECTED .