Report for the Hearing delivered in Case 316/86

I — Facts and procedure

1. Article 12 (1) of Regulation (EEC) No 2727/75 of the Council of 29 October 1975 on the common organization of the market in cereals (Official Journal 1975, L 281, p.1) provides that all imports into the Community or exports therefrom of the products covered by that regulation are to be subject to the submission of an import or export licence issued by the Member States to any applicant irrespective of his place of establishment in the Community; where the levy or refund is fixed in advance, the fixing is to be noted on the export licence, which is to be valid throughout the Community. Article 16 (2) provides that the refund is to be the same throughout the Community; under Article 16 (4), the refund is to be applied, if the applicant so requests when applying for the licence, to an export to be effected during the period of validity of the licence.

2. Article 16 (3) of Regulation (EEC) No 193/75 of the Commission of 17 January 1975 laying down common detailed rules for the application of the system of import and export licences and advance fixing certificates for agricultural products (Official Journal 1975, L 25, p. 10) set up inter alia by Article 12 of Regulation No 120/67 (cereals), replaced by Article 12 of Regulation No 2727/75 (cereals), provides that licences or certificates and extracts properly issued and entries and endorsements stamped by the authorities of a Member State are to have, in each of the Member States, the same legal effects as attach to documents issued and entries or endorsements stamped by the authorities of such Member States.

3. By means of Regulation (EEC) No 974/71 of the Council of 12 May 1971 on certain measures of conjunctural policy to be taken in agriculture following the temporary widening of the margins of fluctuation for the currencies of certain Member States (Official Journal, English Special Edition 1971(1), p. 257) the Council had introduced the system of monetary compensatory amounts. Article 6 provides that the detailed rules for the application of that regulation, which may include other derogations from the regulations on the common agricultural policy, are to be adopted in accordance with the management-committee procedure.

4. Article 1 (1) of Commission Regulation (EEC) No 243/78 of 1 February 1978 providing for the advance fixing of monetary compensatory amounts (Official Journal 1978, L 37, p. 5) lays down the principle that in trade with nonmember countries monetary compensatory amounts may be fixed in advance. Under the second subparagraph of Article 2 (1), the monetary compensatory amount may be fixed in advance only if the import or export levy or refund is fixed in advance for the certificate in question; Article 2 (3) states that the certificate or an extract therefrom is to be valid in only one Member State to be designated by the applicant on submission of the application for the advance fixing of the monetary compensatory amount.

5. At the end of May 1979, Firma P. Krücken, the plaintiff and respondent in the main proceedings (hereinafter referred to as ‘Krücken’), cleared through customs with a view to export from the Federal Republic of Germany to Switzerland a consignment of 1250 tonnes of barley. The export certificate that it presented to the German customs authorities for that purpose, which had been issued in France and had noted on it advance fixing of both the rate of the export refund and the monetary compensatory amounts, indicated that it was valid only in France. Having regard to Article 16 (3) of Regulation No 193/75, which provides that export certificates issued in a Member State are to be valid in all the Member States, the customs officer agreed to complete the formalities for the quantity exported on the basis of that certificate.

6. The Hauptzollamt (Principal Customs Office) Hamburg-Jonas, the defendant and appellant in the main proceedings, by decision of 7 August 1979 granted the export refund and the monetary compensatory amount at the rate in force at the time of exportation, relying on Article 2 (3) of Regulation No 243/78, which limits the validity of the export certificate in which the monetary compensatory amount is fixed in advance to the Member State for which the certificate was applied for.

7. In proceedings brought by Krücken, the Finanzgericht (Finance Court) Hamburg granted the export refund ai the rate fixed in advance in the certificate, on the ground that the amount of the refund was the same for export from all the other Member States to nonmember countries and that the limitation of the validity of the certificate, as regards the advance fixing of monetary compensatory amounts, did not affect the advance fixing of the rate of export refund.

8. An appeal on a point of law was brought by the Hauptzollamt Hamburg-Jonas before the Bundesfinanzhof (Federal Finance Court) and the latter, by provisional decision, held that the application of the rate of export refund fixed in advance in an export certificate was not conditional upon the validity of the export certificate at the date of exportation; subsequently, by order of 29 October 1986, it stayed the proceedings and referred the following questions to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty:

‘1. Does it follow from Community law (Article 2 (3) of Commission Regulation (EEC) No 243/78, Article 16 (4) of Regulation (EEC) No 2727/75 of the Council) that the advance fixing of an export refund contained in a licence submitted at the time of export is not applicable for the purpose of determining the export refund applicable to goods exported from a Member State if the licence (which also contains an advance fixing of the monetary compensatory amount) stipulates that it is valid for another Member State?

2. If so, is it possible in certain circumstances to apply the principle of the protection of legitimate expectations in such a case, with the result that the advance fixing of the export refund should none the less be applied?’

9. The Bundesfinanzhofs order was received at the Court Registry on 17 December 1986.

10. Pursuant to Article 20 of the Protocol on the Statute of the Court of Justice of the EEC, written observations were submitted on 10 March 1987 by Krücken, the plaintiff and respondent in the main proceedings, represented by Axel Bauer, Rechtsanwalt, Hamburg, on 17 March 1987 by the Commission of the European Communities, represented by its Legal Adviser, Peter Karpenstein, and on 20 March 1987 by Hauptzollamt Hamburg-Jonas, the defendant and appellant in the main proceedings, represented by its Director, Eckhardt Bollmann, Regierungsdirektor.

11. Upon hearing the report of the Judge-Rapporteur and the views of the Advocate General, the Court decided to open the oral procedure without any preparatory inquiry. The Commission was asked to answer certain questions. It did so within the period set for that purpose.

12. Pursuant to Article 95 (1) and (2) of the Rules of Procedure, the Court, by decision of 20 May 1987, assigned the case to the Fifth Chamber.

II — Written observations submitted to the Court

1. The Hauptzollamt Hamburg-Jonas, the defendant and appellant in the main proceedings, states that the advance fixing of a refund is possible, whether or not the export of the products in question is subject, as in the case of cereals, to the production of a certificate. Advance fixing is carried out by the competent authorities in the Member States by their issuing an - administrative document known as the export certificate' where the advance fixing is linked to such a certificate or the ‘advance-fixing certificate’. The term certificate is sometimes used in a limited sense, referring only to export or import certificates as in the case of the regulations establishing common market organizations, and sometimes, as in the case of Regulation No 193/75, in a wider sense, covering advance-fixing certificates. In order to answer the first question, it is necessary to establish the meaning attached to ‘certificate’ in Regulation No 243/78. It is apparent from the third recital in the preamble to that regulation, which states that the monetary compensatory amount can only be fixed if, for the same operation, the levy or the refund has been fixed in advance, from Article 3 (1), pursuant to which the application for advance fixing must be lodged at the same time as the application for the certificate, and also from the wording of the certificate, that ‘certificate’ in Regulation No 243/78 has the same scope as in Regulation No 193/75. Pursuant to Article 2 (3) of Regulation No 243/78, the limitation of territorial validity to the Member State designated by the applicant when applying for advance fixing of the monetary compensatory amount applies both to the export certificate and to the advance-fixing certificate. The converse solution would, moreover, result in insurmountable difficulties in administrative practice. The fact that the German customs officer erroneously completed the formalities in respect of the export on the basis of the certificate does not oblige the department responsible for refunds to adopt a measure, as a legal consequence thereof, which is contrary to Community law. There is no case for the protection of legitimate expectations since Krücken contributed to the error committed by the customs authorities and the latter have no powers to fix the refund to be granted. The Hauptzollamt Hamburg-Jonas therefore proposes that the first question should be answered in the affirmative and the second in the negative.

2. Krücken, the plaintiff and respondent in the main proceedings, maintains that the wording ‘certificate valid in France’ appearing on the certificate may lead to confusion in so far as it does not clearly indicate that the certificate is valid only in France. The territiorial limitation of the validity of the certificate derives only from Regulation No 243/78 where the monetary compensatory amount is fixed in advance and is, in principle, contrary to Article 16 (3) of Regulation No 193/75. Moreover, Regulation No 243/78 itself lays down that limitation only in cases where Article 4 (6) thereof applies, and it does not apply in this case. The Finanzgericht Hamburg and the Bundesfinanzhof, in a previous provisional decision, acknowledged that the rules on certificates and those on refunds are independent from each other and that the limitation of the validity of the certificate should have no effect on the refund. The view that the sets of rules are independent is in conformity with the judgment of the Court of 8 April 1976 (Case 106/75. Merkur-Außenhandel GmbH [1976] ECR 531), which made it clear that entitlement to an export refund exists even where the exported product is not the one for which the certificate was issued. It is true that that judgment left open the question whether that concept of separation applies also to the advance fixing of refunds, since, where goods other than those covered by the advance fixing are exported, as in the lastmentioned case, the rate fixed in advance cannot be claimed. But the grounds of that judgment, which give the reasons for separate appraisals of the rules on certificates and those on refunds, apply also in the case of advance fixing, particularly since, in the present case, the relevant requirements for the application of the rate fixed in advance, namely that the goods referred to in the advance-fixing certificate be exported within the period prescribed and to the nonmember country indicated therein, are met. The Court has recognized that the purpose of the legislation on certificates is to enable the Community to forecast the movements of goods, and that that of the legislation on refunds or levies is to offset the difference between Community prices and those on the world market. The system of advance fixing of refunds is covered by the provisions on refunds and not those on certificates. The application of a rate of refund which differed according to the Member State of exportation would go against the spirit of the Community legislation on refunds and is not provided for in Regulation No 243/78. A distinction must be drawn between the import or export certificate, the only documents referred to in Article 2 (3) of Regulation No 243/78, which speaks of a limitation of the validity of the ‘certificate’, and the advance-fixing certificate, a term not used in that article. The German version of the provision properly distinguishes between the import or export certificate and the advance-fixing certificate. The third recital in the preamble to Regulation No 243/78, it must be conceded, allows advance fixing of monetary compensatory amounts only where the levy or refund is fixed in advance, but the fifth recital refers only to the limitation of the ‘Gültigkeitsdauer’ (period of validity) of a certificate in the territory of a Member State, which makes it clear that the limitation relates only to the period of validity, a term which, moreover, is also used in the fourth recital of the French version of the regulation. The import or export certificate, the advance fixing of the refund and the advance fixing of the monetary compensatory amount are three separate administrative measures. The fact that they are dealt with in one and the same printed form does not create legal unity between them. Krücken therefore considers that the following reply should be given to the first question: A reply to the second question is required only in the alternative. In the judgments of 15 December 1983 (Case 282/82 Papierfabrik Schöllershammer v Commission [1983] ECR 4219) and of 15 May 1986 (Case 160/84 Oryzomyli v Commission [1986] ECR 1633), Article 13 of Council Regulation (EEC) No 1430/79 of 2 July 1979 on the repayment or remission of import or export duties (Official Journal 1979, L 175, p. 1), which enables the repayment or remission of import duties to be proceeded with in situations resulting from special circumstances not involving negligence or deception on the part of the person concerned, was considered by the Court to be a general equitable provision. In the present case, recourse cannot be had to a specific provision of Community law, but rather to an unwritten principle of Community law, namely that of the protection of legitimate expectations, by reference to which it is necessary to appraise the conduct of the German public authorities which agreed to the export of the quantities concerned on the basis of the certificate in question. Whilst stressing that the issue is not whether such protection may be accorded pursuant to national law, Krücken gives a brief summary of the relevant German domestic law, which contains no express provisions guaranteeing the protection of legitimate expectations but only general principles of law, such as the principle of ‘Treu und Glauben’, the obligation of mutual respect and that of the protection of legitimate expectations. It is perfectly justifiable to ask whether, when Community law is implemented, principles of Community law, such as that of the protection of legitimate expectations or of legal certainty, do not, in the absence of specific national provisions, require certain conduct on the part of the national authorities. In the judgment of 6 October 1982 (Case 302/81 Alfred Eggers [1982] ECR 3443), Article 11 of Regulation No 1380/75 of the Commission of 29 May 1975 laying down detailed rules for the application of monetary compensatory amounts (Official Journal 1975, L 169, p. 37), as amended, which provides for the issue of a fresh control copy where the first has gone astray as a result of circumstances beyond the control of the person concerned, was considered by the Court to embody and recognize a general principle whereby procedural flaws which are beyond the control of the person to whom monetary compensatory amounts should normally be granted must not have effects which are unfavourable to him. The Community has delegated to the national authorities questions of procedure concerning the acceptance or rejection of an export certificate. Procedural errors committed in connection therewith are the responsibility of the national authority but should not adversely affect the person concerned, having regard to the principle of the protection of legitimate expectations. In the absence of specific national provisions, it would seem logical, in matters concerning the application of Community law, to infer such protection from Community law. Krücken therefore considers that the following reply should be given to the second question:

‘Community law does not have the effect, where an export refund is fixed for goods exported from a Member State, of preventing the advance fixing of the refund entered on a certificate — which is presented at the time of export — from being applied where the certificate, which also records the advance fixing of the monetary compensatory amount, is endorsed to the effect that it is valid in another Member State’.

‘The principle of the protection of legitimate expectations must be interpreted as meaning that the advance fixing of the export refund shown on a certificate must be applied in any event when the competent customs official completes the customs formalities for the export on the basis of the certificate after withdrawing his reservations as to the validity of the certificate and the exporter may prove that in the event of non-application of the advance fixing of the export refund shown on the certificate he would have produced another valid certificate showing an advance fixing of the export refund which would have been favourable to him or that he would have effected the export from the Member State in which the certificate concerned was valid.’

3. The Commission considers that an export certificate with advance fixing both of the export refund and of the monetary compensatory amounts is valid, pursuant to Article 2 (3) of Regulation No 243/78, only in the State designated by the person who applied for the certificate. Pursuant to the first subparagraph of Article 12 (1) of Regulation No 2727/75, Krücken was not entitled to export cereals from Germany on the basis of a certificate valid for France; the Hauptzollamt was correct to grant the refunds and the monetary compensatory amounts at the rates ruling on the day of exportation. The export certificate properly so called and the advance fixings shown on it form an inseparable whole. All the factors of importance for a given export operation, namely the type of product, quantity, weight, holder of the certificate, period of validity, and the rates of refund and monetary compensatory amount are shown on a document on which the issuer affixes its signature and stamp on one occasion only. Article 16 (4) of Regulation No 2727/75 expressly provides that the application for advance fixing of the refund will be accepted only if it accompanies the application for an export certificate. That constitutes an express legislative provision establishing that the export refund fixed in advance cannot be dissociated from the export certificate, particularly since its period of validity and territorial validity are determined by the validity of the export certificate. The limitation of the validity of the export certificate applies also to the advance fixing of the refund. To authorize the certificate holder, in the event of the monetary compensatory amounts also being fixed in advance, to export from any Member State would enable him to take advantage of the monetary fluctuations occurring after the advance fixing by exporting from the State which ensured the best results. It is apparent from the third and fifth recitals in the preamble to Regulation No 243/78 that the limitation of the territorial validity of the certificate is intended to prevent speculative operations. The third subparagraph of Article 12 (1) of Regulation No 2727/75 and Article 16 (3) of Regulation No 193/75 confirm beyond doubt that import and export certificates are valid, in principle, throughout the Community. Under Article 12 (2) of Regulation No 2727/75, however, the Commission is expressly authorized to adopt implementing provisions, for which purpose it is vested with wide powers. Moreover, Regulation No 243/78 is based inter alia on Article 6 of Regulation No 974/71 which, within the framework of the rules on monetary compensatory amounts, permits derogations from Council regulations. Regulation No 193/75, for its part, is a Commission regulation from which the Commission is entitled to derogate at any time. The Commission therefore proposes that it should be stated in reply to the first question that: As regards the second question, the Commission considers that the problem of the protection of legitimate expectations can arise, if at all, only at national level. The Community institutions did not act in breach of that principle, the Community provisions applicable to the case were clear and were not retroactive or unexpected to the plaintiff. In the alternative, the Commission observes that the Community provisions which, in the event of misinterpretation by the customs autnonues, permit abrogations from the general rules in certain circumstances — namely Council Regulations Nos 1430/79 and 1697/79 —relate only to duties on Community exports and imports and not the refunds at issue here. Finally, there is no general principle of law to the effect that a provision of Community law must not be applied by the national authorities or courts where to do so would result in an inequality which the Community legislature would clearly have sought to avoid if it had envisaged the eventuality when drafting the provision in question. It should therefore be stated in reply to the second question that:

‘Article 2 (3) of Regulation (EEC) No 243/78 and Article 16 (4) of Regulation (EEC) No 2727/75 must be interpreted as meaning that where an export certificate is, by reason of the advance fixing of monetary compensatory amounts, valid only in one Member State, the export refund fixed in advance in that certificate can only be granted if the export is effected from the State whose authorities issued the certificate’.

‘An error of appraisal as to the geographical scope of an export certificate committed by a national customs authority cannot affect the reply given to the first question, either per se or in conjunction with the fact that the exporter might possibly have been able to present another valid certificate or effect the export from another Member State’.

III — Replies to the questions put by the Court

The Commission was asked to explain the technicalities of the connection between the advance fixing of the monetary compensatory amounts and that of export refunds; it stated that levies and advance fixings reflect the difference between the level of the world price and that of the Community price, but not the difference between the Community price expressed in ecu and the price at the green rate applied in the Member States, so that it is necessary to apply monetary compensatory amounts not only in intra-Community trade but also in trade with nonmember countries. Monetary compensatory amounts are intended exclusively to adapt the structure of world market prices to the variations to which the prices actually charged are subject by virtue of the green rate and they do not form part of the export refunds or levies. The monetary coefficient is merely a means of dealing with the twofold price variance between the Community price and the world price, on the one hand, and the Community price and the national price on the other. That coefficient is derived from the percentage used to calculate the monetary compensatory amount. Following the application of the monetary coefficient, levies fixed in ecu and export refunds acquire a value which is approximately the same for all the Member States.

In response to the question whether an export certificate showing an advance fixing of export refunds can be obtained without parallel advance fixing of the monetary compensatory amounts and to the question why a trader exporting the products in question from a Member State other than that mentioned in the application for advance fixing of the monetary compensatory amounts cannot waive the advance fixing for those amounts but at the same time retain the benefit of the export certificate showing advance fixing of the export refunds, the Commission stated that the second subparagraph of Article 2 (1) of Regulation No 243/78 only excludes advance fixing of monetary compensatory amounts without simultaneous advance fixing of the export refunds or levies; there is nothing to prevent the advance fixing of the export refund alone. If traders were allowed, in the case of simultaneous fixing of the refund and of the monetary compensatory amount, to export from any Member State, there would be a risk of speculation detrimental to the common agricultural Fund. In States susceptible to devaluation, the monetary compensatory amounts payable on exports are in general fixed in advance and accordingly all risk would be eliminated if it were also possible to abandon those monetary compensatory amounts on request in the event of a reverse trend emerging.

According to Article 6 (1) of Regulation No 243/78, the monetary compensatory amount valid on the day on which the application for advance fixing is lodged is applicable to all imports and exports effected during the period of validity of the certificate. The advance fixing of the monetary compensatory amounts is binding for traders, just like the advance fixing of levies and refunds. The security covers three obligations, namely the obligation to use the export certificate issued, the obligation to use the refund fixed in advance and the obligation to abide by the monetary compensatory amounts fixed in advance. If traders were permitted unilaterally to release themselves from the latter obligation, new rules would have to be created concerning the security required to cover the various obligations and the new division of powers as between the authorities of the various States.

In response to a request to give details of the nature of the speculative operations which it is sought to prevent by establishing a link between the advance fixing of the monetary compensatory amounts and that of the export refunds, on the one hand, and, on the other, by extending the limitation of the territorial validity of the certificate applicable to the advance fixing of monetary compensatory amounts to the advance fixing of export refunds, the Commission stated that, in the event of double advance fixing without limitation of the territorial validity of the certificate, exports would generally be effected only from that State which, according to the monetary situation, enabled the certificate holder to complete the most advantageous transactions. The certificate holder could in fact benefit not only from monetary fluctuations but also from any fluctuations in the green rate. However, the purpose ol advance fixing is not to ensure a particular level of profit for traders but merely to introduce a degree of stability into the conduct of a given transaction.

IV — Oral procedure

Krücken, the plaintiff in the main proceedings, contested in particular the validity of Article 2 (3) of Regulation No 243/78. It considers that provision contrary to the third subparagraph of Article 12 (1) of Regulation No 2727/75 of the Council, according to which an import or export certificate is valid throughout the Community; it also considers it contrary to Article 16 of Regulation No 193/75 of the Commission, which accords to certificates issued by the authorities of a Member State the same effects as the corresponding national documents; finally, it considers that that provision is in breach of the principle of proportionality, in so far as the limit on the validity of the certificate is not strictly necessary for attainment of the aim pursued, namely the prevention of speculation.

The Commission, for its part, considers that Article 12 (2) of Regulation No 2727/75 and Article 6 (1) of Regulation No 974/71 are provisions which expressly empower it to make derogations from the regulations on the common agricultural policy. The provision contested by Krücken is accounted for by the need to prevent abuses ror speculative purposes.

F. Schockweiler

Judge-Rapporteur

1 Language of the Case: German.