Court of Justice 03-12-1992 ECLI:EU:C:1992:490

Judgment

1 By order of 12 July 1990, which was received at the Court on 4 September 1990, the Finanzgericht (Finance Court) Hamburg referred to the Court for a preliminary ruling under Article 1 77 of the EEC Treaty a question on the validity of the second indent of Article 3a(l) of Council Regulation (EEC) No 857/84 of 31 March 1984 adopting general rules for the application of the levy referred to in Article 5c of Regulation (EEC) No 804/68 in the milk and milk products sector (OJ 1984 L 90, p. 13), as amended by Council Regulation (EEC) No 764/89 of 20 March 1989 (OJ 1989 L 84, p. 2).

2 The question arose in proceedings between Heinrich Wehrs and Hauptzollamt (Principal Customs Office) Lüneburg arising out of the Hauptzollamt's refusal to grant Mr Wehrs a reference quantity under the system of the additional levy on milk.

3 Mr Wehrs, a farmer in Germany, obtained a reference quantity of 183 816 kg of milk on account of the quantity of milk he supplied in 1983, the reference year adopted by the Federal Republic of Germany He sought an increase in the reference quantity on the ground that on 23 March 1984 — that is to say, before the additional levy system entered into force — he purchased 2.5 hectares of farmland which formed part of a holding formerly used for milk production. The former owner of the land had stopped producing milk on 10 January 1981 for four years pursuant to a conversion undertaking entered into under Council Regulation (EEC) No 1078/77 of 17 May 1977 introducing a system of premiums for the non-marketing of milk and milk products and for the conversion of dairy herds (OJ 1977 L 131, p. 1). The undertaking was taken over by Mr Wehrs as regards the newly-purchased land.

4 The competent Landwirtschaftskammer (Agricultural Chamber) initially granted Mr Wehr's application and increased his reference quantity by 6 820 kg. However, th Hauptzollamt Lüneburg ordered that decision to be annulled on the ground that under the second indent of Article 3a(1) of Regulation No 857/84, as amended, Mr Wehrs was barred from being granted a provisional special reference quantity because he already had a reference quantity, granted pursuant to Article 2 of Regulation No 857/84 and calculated on the basis of milk deliveries made in 1983.

5 Considering that its decision depended on the validity of the second indent of Article 3a(1) of Regulation No 857/84, as amended, the Finanzgericht Hamburg, before which an action had been brought by MrNWehrs, stayed the proceedings and referred the following question to the Court for a preliminary ruling:

‘Is the second indent of Article 3a(1) of Council Regulation (EEC) No 857/84, as amended by Council Regulation (EEC) No 764/89, valid in so far as persons taking over a premium granted pursuant to Council Regulation (EEC) No 1078/77 are barred from allocation of a provisional special reference quantity if they have received a reference quantity under Article 2 of Regulation (EEC) No 857/84?’

6 Reference is made to the Report for the Hearing for a fuller account of the facts, the relevant Community provisions, the procedure and the written observations submitted to the Court which are mentioned or discussed hereinafter only in so

7 It should be observed in limine that originally the Community legislation on the additional levy on milk did not include any specific provision making it possible for a reference quantity to be allocated to producers who, pursuant to an undertaking given under Regulation No 1078/77, had not delivered any milk during the reference year chosen by the Member State concerned. However, in its judgments of 28 April 1988 in Case 120/89 Muiter v Minister van Landbouw en Visserij [1988] ECR 2321 and Case 170/86 Von Deetzen v HauptzolUmt Hamburg Jonas [1988] ECR 2355, the Court declared those rules invalid on the ground that they were in Breach of the principle of protection of legitimate expectations.

8 In those judgments, the Court held that a producer who had voluntarily ceased production for a certain period could not legitimately expect to be able to resume production under the same conditions as those which previously applied and not to be subject to any rules of market or structural policy adopted in the meantime (Mulder, paragraph 23; Von Deetzen, paragraph 12). The Court added, however, that where such a producer had been encouraged by a Community measure to suspend marketing for a limited period in the general interest and against payment of a premium he might legitimately expect not to be subject, upon the expiry of his undertaking, to restrictions which specifically affected him precisely because he availed himself of the possibilities offered by the Community provisions (Mulder, paragraph 24; Von Deetzen, paragraph 13).

9 Following those judgments, the Council adopted on 20 March 1989 Regulation No 764/89, which inserted a new Article 3a in Regulation No 857/84. That article provides essentially that milk producers who, pursuant to an undertaking given under Regulation No 1078/77, have not delivered milk during the reference year are to receive, in certain circumstances, a special reference quantity calculated on the basis of the quantity of milk delivered or the quantity of milk equivalent sold by the producer during the twelve months preceding the month in which the application for the non-marketing or conversion premium was made.

10 However, the second indent of Article 3a(l) laid down a so-called ‘rule against overlapping’ according to which allocation of a special reference quantity is restricted to producers who have not otherwise obtained a reference quantity on the terms prescribed by other rules of the additional levy system.

11 It is provided, inter alia, that a person to whom a premium has been transferred may claim the benefit of the provisions of Article 3a only if it is established that he has not previously received a reference quality under the terms of the ordinary law laid down by Article 2 of Regulation No 857/84.

12 This reference for a preliminary ruling on validity is concerned with that condition, which has the effect, in the case before the national court, of barring the producer from being allocated a reference quality for the holding in respect of which he is the transferee of the premium.

13 The Court holds that a producer who, as in the case before the national court, has taken over a holding subject to a non-marketing or conversion undertaking together with the obligations entered into by his predecessor and has accordingly been paid the balance of the premium in accordance with Article 6 of Regulation No 1078/77, was legitimately entitled, in exactly the same way as a producer who was bound by such an undertaking throughout the non-marketing or conversion period, to expect not to be subject, on the expiry of his undertaking, to restrictions specifically affecting him on account of that undertaking.

14 However, the rule against overlapping in question imposes such restrictions on that category of producers in so far as it bars them from obtaining a reference quantity in respect of the holding for which an undertaking was given under Regulation No 1078/77, whereas no such legal consequence is laid down; given the absence of a similar prohibition of overlapping, for producers who were not bound by such an undertaking during the reference year.

15 Consequently, the provision at issue frustrates the legitimate expectation which the producers concerned were entitled to entertain as to the limited nature of their undertakings, which they entered into before the system of the additional levy on milk came into force. It must therefore be declared invalid for infringing the principle of protection of legitimate expectations, without there being any need to consider the other arguments put forward against the validity of that provision during the proceedings.

16 The reply to the national court's question should therefore be that the second indent of Article 3a(1) of Regulation No 857/84, as amended by Regulation No 764/89, is invalid in so far as persons taking over a premium granted pursuant to Regulation No 1078/77 are barred from allocation of a special reference quantity if they have received a reference quantity under Article 2 of Regulation No 857/84.