1 BY APPLICATION REGISTERED ON 16 JULY 1973 THE GOVERNMENT OF IRELAND, PURSUANT TO ARTICLE 173, FIRST PARAGRAPH, OF THE EEC TREATY, BROUGHT BEFORE THE COURT AN ACTION FOR THE ANNULMENT OF REGULATION ( EEC ) NO 1365/73 OF THE COUNCIL OF 21 MAY 1973 ( OJ L 137, 1973 ), TO THE EXTENT THAT THAT REGULATION IS CONCERNED WITH THE FIXING OF COMPENSATORY AMOUNTS FOR TOMATOES FOR DELIVERY FRESH TO THE CONSUMER .
2 IN SUPPORT OF ITS ACTION, THE APPLICANT SUBMITS, FIRSTLY, THAT THE REGULATION IN ISSUE INFRINGES ARTICLES 65 AND 66 OF THE 'ACT CONCERNING THE CONDITIONS OF ACCESSION AND THE ADJUSTMENTS TO THE TREATIES' ( HEREINAFTER REFERRED TO AS THE 'ACT OF ACCESSION ') ANNEXED TO THE TREATY OF ACCESSION SIGNED AT BRUSSELS ON 22 JANUARY 1972, IN THAT, FOR THE PURPOSE OF FIXING THE COMPENSATORY AMOUNT FOR TOMATOES, IT APPLIED A CONVERSION FACTOR TO THE PRODUCER PRICE . THE APPLICATION OF THIS CONVERSION FACTOR IS ALLEGED TO BE ALL THE MORE UNJUSTIFIED IN THAT THE IRISH PRODUCER PRICE RELATED TO A PRODUCT COMMERCIALLY COMPARABLE TO THAT IN RELATION TO WHICH THE COMMON BASIC PRICE WAS FIXED .
3 IT IS APPARENT FROM THE ARGUMENTS THAT THE ACTION IS CONCERNED SOLELY WITH THOSE PROVISIONS OF THE REGULATION AFFECTING IRELAND .
4 ARTICLE 65 ( 1 ) OF THE ACT OF ACCESSION PROVIDES FOR THE FIXING OF A COMPENSATORY AMOUNT FOR FRUIT AND VEGETABLES IN RESPECT OF WHICH THE NEW MEMBER STATE CONCERNED APPLIED, DURING 1971, QUANTITATIVE RESTRICTIONS OR MEASURES HAVING EQUIVALENT EFFECT . ACCORDING TO THIS PROVISION, THE FIXING OF THE COMPENSATORY AMOUNT PRESUPPOSES THE ESTABLISHMENT, ON THE ONE HAND, OF A COMMON BASIC PRICE AND, ON THE OTHER HAND, IN THE NEW MEMBER STATE CONCERNED, OF A PRODUCER PRICE WHICH APPRECIABLY EXCEEDS THE BASIC PRICE APPLICABLE IN THE COMMUNITY AS ORIGINALLY CONSTITUTED DURING THE PERIOD PRECEDING THE APPLICATION OF THE COMMUNITY SYSTEM TO THE NEW MEMBER STATES .
5 ACCORDING TO ARTICLE 66 ( 1 ) OF THE SAID ACT, THE COMPENSATORY AMOUNT SHALL BE EQUAL TO THE DIFFERENCE BETWEEN THE PRODUCER PRICE IN THE NEW MEMBER STATE CONCERNED AND THE COMMON BASIC PRICE .
6 THE COMMON BASIC PRICE IS CALCULATED, PURSUANT TO THE CRITERIA LAID DOWN IN ARTICLE 16 ( 2 ) OF REGULATION NO 1035/72 OF THE COUNCIL OF 18 MAY 1972 ( OJ L 118, 1972 ), HAVING REGARD TO PRICES RECORDED ON THE REPRESENTATIVE COMMUNITY MARKET OR MARKETS WHICH ARE SITUATED IN THE SURPLUS PRODUCTION AREAS WITH THE LOWEST PRICES DURING THE THREE MARKETING YEARS IMMEDIATELY PRECEDING THE DATE ON WHICH THE BASIC PRICES ARE FIXED .
7 SINCE THE PRODUCTION AREAS TAKEN INTO ACCOUNT IN CALCULATING THE COMMON BASIC PRICE ARE THOSE WHERE TOMATOES ARE MORE USUALLY GROWN IN THE OPEN, THE FIGURES EMPLOYED FOR FIXING THIS PRICE REFER TO OPEN FIELD TOMATOES .
8 FURTHERMORE, THE IRISH PRODUCER PRICE WAS FIXED PURSUANT TO THE CRITERIA CONTAINED IN ARTICLE 65 ( 2 ) OF THE ACT OF ACCESSION, BY APPLYING TO THE NATIONAL DATA OF THE NEW MEMBER STATE THE 'PRINCIPLES SET OUT IN ARTICLE 4 ( 2 ) OF REGULATION NO 159/66/EEC LAYING DOWN ADDITIONAL PROVISIONS IN RESPECT OF THE COMMON ORGANIZATION OF THE MARKET IN FRUIT AND VEGETABLES '. SINCE THE IRISH NATIONAL DATA ARE CONCERNED SOLELY WITH THE CULTIVATION OF TOMATOES UNDER GLASS - THE PRODUCER PRICE EMPLOYED REFERS TO TOMATOES GROWN UNDER GLASS .
9 REGULATION NO 1365/73 OF THE COUNCIL FIXED THE COMPENSATORY AMOUNT AT ISSUE ON THE BASIS OF THE PRODUCER PRICE AND THE COMMON BASIC PRICE CALCULATED IN THIS WAY . ON THE BASIS THAT THE DIFFERING METHODS OF CULTIVATION FOR TOMATOES GROWN UNDER GLASS AND THOSE GROWN IN THE OPEN ARE REFLECTED IN A DIFFERENCE BETWEEN THOSE PRODUCTS IN COMMERCIAL TERMS, THE SAID REGULATION, IN ITS FINAL RECITAL, DECIDED THAT A CONVERSION FACTOR FIXED AT A STANDARD FIGURE OF 0.55 SHOULD BE APPLIED IN RESPECT OF PRICES FOR TOMATOES GROWN UNDER GLASS . THIS CONVERSION FACTOR WAS IN FACT APPLIED TO IRISH PRODUCER PRICES .
10 IN SUPPORT OF THIS DECISION THE COUNCIL CONTENDED, IN PARTICULAR, THAT THE 'PRINCIPLES SET OUT IN ARTICLE 4 ( 2 )' OF REGULATION NO 159/66 FOR THE CALCULATION OF THE PRODUCER PRICE, TO WHICH ARTICLE 65 ( 2 ) OF THE ACT OF ACCESSION REFERS, INCLUDE ALL THE RULES CONTAINED IN ARTICLE 4, INCLUDING THOSE CONTAINED IN THE LAST PARAGRAPH WHICH PROVIDE FOR THE APPLICATION OF CONVERSION FACTORS TO THE BUYING IN PRICE IN THE EVENT OF THE PRODUCT CONCERNED DISPLAYING COMMERCIAL CHARACTERISTICS WHICH DIFFER FROM THOSE OF THE PRODUCT BY REFERENCE TO WHICH THE BASIC PRICE IS FIXED .
11 THE OBJECT OF A SYSTEM OF COMPENSATORY AMOUNTS INSTITUTED BY ARTICLES 65 AND 66 OF THE ACT OF ACCESSION IS ESSENTIALLY TO FACILITATE THE GRADUAL ADAPTATION BY THE NEW MEMBER STATES TO THE RULES IN FORCE WITHIN THE COMMUNITY AS ORIGINALLY CONSTITUTED . THIS ADAPTATION IS TO BE EFFECTED BY MEANS OF TRANSITIONAL MEASURES, AMONGST WHICH ARTICLE 55 ( 1 ) ( A ) PROVIDES FOR THE APPLICATION, IN THE AGRICULTURAL SECTOR, OF COMPENSATORY AMOUNTS LEVIED ON IMPORTS AND EXPORTS BY THE NEW MEMBER STATES IN TRADE BETWEEN THE LATTER AND WITH THE COMMUNITY AS ORIGINALLY CONSTITUTED, SUCH AMOUNTS BEING DESIGNED TO COMPENSATE DIFFERENCES BETWEEN THE NATIONAL PRICE LEVELS IN THOSE STATES AND COMMON PRICE LEVELS .
12 THE ACT OF ACCESSION ATTRIBUTES TO THESE COMPENSATORY AMOUNTS THE FUNCTION OF ENSURING A MEASURE OF TARIFF PROTECTION WHICH, IF NOT IDENTICAL TO THAT ENJOYED BY THE NEW MEMBER STATES BY REASON OF THEIR NATIONAL LEGISLATION BEFORE THEIR ACCESSION TO THE COMMUNITIES, IS AT LEAST COMPARABLE THERETO .
13 MORE PARTICULARLY IN THE CONTEXT OF THE COMMON ORGANIZATION OF AGRICULTURAL MARKETS, ARTICLE 65 ( 1 ) OF THE ACT PROVIDES IN EFFECT THAT, WITH REGARD TO FRUIT AND VEGETABLES, THE COMPENSATORY AMOUNTS ARE TO BE FIXED ONLY IF THE NEW MEMBER STATE CONCERNED APPLIED, DURING 1971, QUANTITATIVE RESTRICTIONS OR MEASURES HAVING EQUIVALENT EFFECT . THE PROTECTIVE FUNCTION OF THE COMPENSATORY AMOUNTS, WHICH ARE DESIGNED TO SUPERSEDE NATIONAL MEASURES FOR THE PROTECTION OF THE MARKET, IS CLEARLY APPARENT FROM THIS PROVISION .
14 THE COMPENSATORY AMOUNTS ENVISAGED BY ARTICLE 65 AND 66 OF THE ACT OF ACCESSION SHOULD THEREFORE OFFER IRISH TOMATO PRODUCERS A MEASURE OF PROTECTION, AGAINST IMPORTS OF TOMATOES FROM THE COMMUNITY AS ORIGINALLY CONSTITUTED, COMPARABLE TO THAT PROVIDED BY THE QUANTITATIVE RESTRICTIONS AND MEASURES HAVING EQUIVALENT EFFECT APPLIED IN 1971 .
15 EVEN ON THE SUPPOSITION THAT TOMATOES GROWN IN THE OPEN ARE, IN A COMMERCIAL SENSE, A DIFFERENT PRODUCT FROM TOMATOES GROWN UNDER GLASS, THE FORMER ARE LIKELY TO COMPETE WITH THE LATTER WHEN OFFERED FOR SALE AT THE SAME TIME AS TOMATOES GROWN UNDER GLASS . ACCORDINGLY, SINCE THE ADOPTION OF CONVERSION FACTORS, BY ITS VERY NATURE, AFFECTS THE LEVEL OF THE RELEVANT COMPENSATORY AMOUNT IN A WAY WHICH IS UNFAVOURABLE FOR THE NEW MEMBER STATE, SUCH ADOPTION COULD ONLY BE PERMISSIBLE IF IT WERE EXPRESSLY PROVIDED BY THE ACT OF ACCESSION OR WERE CLEARLY NECESSARY FOR THE FIXING AND CORRECT APPLICATION OF THE COMPENSATORY AMOUNT .
16 ARTICLE 4 ( 2 ) OF REGULATION NO 159/66 OF THE COUNCIL OF 25 OCTOBER 1966 ( OJ NO 192, 1966 ), DOES NOT INCLUDE, AMONGST THE PRINCIPLES TO WHICH IT GIVES EXPRESSION, THE POSSIBILITY OF APPLYING CONVERSION FACTORS TO THE BASIC PRICE, NOR DOES IT PROVIDE, BY MEANS OF THE REFERENCE IN ARTICLE 65 ( 2 ) OF THE ACT OF ACCESSION, FOR THE APPLICATION OF CONVERSION FACTORS TO THE PRODUCER PRICE IN THE NEW MEMBER STATE .
17 ARTICLE 65 ( 2 ), SINCE IT DERIVES FROM THE ABOVE-MENTIONED ARTICLE 4 ( 2 ) THE 'PRINCIPLES' TO BE APPLIED FOR THE FIXING OF THE PRODUCER PRICE, GIVES A PRECISE DEFINITION OF THE SCOPE AND LIMITS OF ITS REFERENCE . THE EXTENSION OF THIS REFERENCE TO 'PRINCIPLES' OTHER THAN THOSE CONTAINED IN ARTICLE 4 ( 2 ) WOULD CONSTITUTE A DISREGARD OF THE SPIRIT AS WELL AS THE LETTER OF ARTICLE 65 ( 2 ) OF THE ACT OF ACCESSION . SUCH AN EXTENSION OF THE REFERENCE WOULD BE RENDERED STILL LESS ADMISSIBLE BY THE FACT THAT AT THE TIME WHEN THE ACCESSION AGREEMENT WAS SIGNED, THE STATES WHICH WERE PARTIES TO THAT AGREEMENT WERE AWARE THAT THE POSSIBILITY OF APPLYING CONVERSION FACTORS WAS PROVIDED BY ARTICLE 7 ( 2 ) OF THE SAME REGULATION AND THAT, IN CONSEQUENCE OF AN AMENDMENT INCORPORATED BY REGULATION NO 2515/69 OF 9 DECEMBER 1969 ( OJ L 318, 1969 ), THAT POSSIBILITY WAS DEALT WITH IN THE FINAL PARAGRAPH OF THE SAID ARTICLE 4 .
18 IF THIS POSSIBILITY HAD IN FACT BEEN ENVISAGED BY THE AUTHORS OF THE ACT OF ACCESSION FOR THE PURPOSE OF FIXING COMPENSATORY AMOUNTS FOR TOMATOES, THE ACT WOULD NECESSARILY HAVE MADE EXPRESS MENTION OF THAT POSSIBILITY OR WOULD HAVE REFERRED TO THE WHOLE OF ARTICLE 4 OF REGULATION NO 159/66, SO AS TO INCLUDE IN THE REFERENCE THE PRINCIPLES CONTAINED IN THE FINAL PARAGRAPH OF THAT PROVISION . IN FACT IT IS CLEAR FROM THE PROVISIONS OF THE ACT OF ACCESSION DEVOTED TO OTHER AGRICULTURAL MARKETS, AND MORE PRECISELY FROM SECTIONS 4 TO 8 OF CHAPTER 2, TITLE II, WHICH ALSO CONTAINS ARTICLES 65 AND 66, THAT, IN CASES WHERE THE ACT ALLOWS OF THE POSSIBILITY OF EMPLOYING CONVERSION FACTORS FOR THE ASSESSMENT OF THE COMPENSATORY AMOUNT, IT DOES SO EXPRESSLY, DEFINING AT THE SAME TIME THE DETAILS OF THEIR APPLICATION .
19 IT FOLLOWS THAT ARTICLE 65 ( 2 ) OF THE ACT OF ACCESSION, WHEN IT REFERS TO THE 'PRINCIPLES' CONTAINED IN ARTICLE 4 ( 2 ) OF REGULATION NO 159/66, IS CONCERNED SOLELY WITH THE CRITERIA FOR CALCULATION EXPRESSLY DEFINED BY THE LAST-MENTIONED PROVISION AND DOES NOT INCLUDE THE POSSIBILITY, WHICH IS ENVISAGED BY OTHER PROVISIONS OF THE SAID REGULATION, OF EMPLOYING CONVERSION FACTORS .
20 MOREOVER, THE COUNCIL'S ARGUMENT THAT THE DISTINCTION WHICH, IN ITS OPINION, EXISTS IN THE COMMERCIAL CONTEXT BETWEEN TOMATOES GROWN IN THE OPEN AND THOSE GROWN UNDER GLASS RENDERED THE APPLICATION OF CONVERSION FACTORS TO THE IRISH PRODUCER PRICE INEVITABLE IS IN NO WAY JUSTIFIED BY ARTICLE 4 ( 2 ) OF REGULATION NO 159/66 AND, FURTHERMORE, IS IN CONFLICT WITH THE PRACTICE PREVIOUSLY FOLLOWED BY THE COUNCIL IN THE CASE OF OTHER PRODUCTS WHICH ARE ALSO COVERED BY THE COMMON ORGANIZATION OF THE MARKET IN FRUIT AND VEGETABLES . ARTICLE 4 ( 2 ) DOES NOT DEFINE THE COMMERCIAL CHARACTERISTICS OF THE PRODUCT WHICH ARE TO BE TAKEN FOR THE CALCULATION OF THE BASIC PRICE AND DOES NOT PRECLUDE THE POSSIBILITY THAT THE SAME BASIC PRICE MAY BE FIXED FOR PRODUCTS OF THE SAME TYPE WHICH MAY BE DEFINED IN DIFFERENT WAYS IN RELATION TO EACH OTHER BY REASON OF THEIR COMMERCIAL CHARACTERISTICS .
21 FURTHERMORE, THE DISTINCTION BETWEEN TOMATOES GROWN UNDER GLASS AND THOSE GROWN IN THE OPEN IS NOT MADE, AS A GENERAL RULE, IN ACTS OF THE COMMUNITY ADOPTED PRIOR TO THE ACCESSION OF THE NEW MEMBER STATES, NOR WAS IT MADE IN REGULATION NO 1173/72 OF 6 JUNE 1972, DETERMINING THE COMMON BASIC PRICE USED FOR THE FIXING OF THE COMPENSATORY AMOUNT AT ISSUE .
22 HOWEVER, IT IS CLEAR FROM THE TEXT AND OBJECTIVE OF ARTICLE 4 ( 2 ) OF REGULATION NO 159/66 THAT SINCE THE BASIC PRICE IS FIXED FOR A PRODUCT WITH DEFINED COMMERCIAL CHARACTERISTICS, THE CHARACTERISTICS UPON WHICH THE DEFINITION OF THE RELEVANT PRODUCT IS BASED MUST BE SPECIFIED WHEN THE BASIC PRICE IS FIXED AND MENTIONED IN THE ACT BY WHICH THAT PRICE IS FIXED . THE FACT THAT THE DISTINCTION BETWEEN TOMATOES GROWN UNDER GLASS AND THOSE GROWN IN THE OPEN WAS SUBSEQUENTLY EMPLOYED IN COUNCIL REGULATIONS NOS 999/73 OF 11 APRIL 1973 ( OJ L 99, 1973 ) AND 1624/73 OF 8 JUNE 1973 ( OJ L 163, 1973 ), FIXING THE REFERENCE PRICE AND THE WITHDRAWAL PRICE FOR TOMATOES, FOR THE 1973 MARKETING YEAR AND THE 1973/74 MARKETING YEAR RESPECTIVELY, IS HERE NOT RELEVANT .
23 ACCORDINGLY THE CONCLUSION MUST BE DRAWN THAT REGULATION NO 1365/73 OF THE COUNCIL OF 21 MAY 1973, IN THAT IT APPLIES A CONVERSION FACTOR TO THE IRISH PRODUCER PRICE FOR TOMATOES FOR THE PURPOSE OF CALCULATING THE COMPENSATORY AMOUNT, INFRINGED ARTICLES 65 AND 66 OF THE ACT OF ACCESSION, AS WELL AS ARTICLE 4 ( 2 ) OF REGULATION NO 159/66 .
24 REGULATION NO 1365/73 MUST THEREFORE BE DECLARED VOID, TO THE EXTENT THAT IT PROVIDES FOR THE APPLICATION OF A CONVERSION FACTOR TO THE PRODUCER PRICE AND, IN CONSEQUENCE, FIXES THE COMPENSATORY AMOUNT TO BE APPLIED IN IRELAND TO TOMATOES FOR DELIVERY FRESH TO THE CONSUMER .
25 UNDER THE TERMS OF ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS IF THEY HAVE BEEN ASKED FOR IN THE SUCCESSFUL PARTY'S PLEADINGS .
26 THE DEFENDANT HAS BEEN UNSUCCESSFUL IN ITS SUBMISSIONS .
27 ACCORDINGLY, PURSUANT TO THE APPLICANT'S PLEADINGS, THE DEFENDANT MUST BE ORDERED TO PAY THE COSTS .
THE COURT
HEREBY :
1 . DECLARES REGULATION ( EEC ) NO 1365/73 OF THE COUNCIL OF 21 MAY 1973 VOID, TO THE EXTENT THAT IT PROVIDES FOR THE APPLICATION OF A CONVERSION FACTOR TO THE PRODUCER PRICE AND, IN CONSEQUENCE, FIXES THE COMPENSATORY AMOUNT TO BE APPLIED IN IRELAND TO TOMATOES FOR DELIVERY FRESH TO THE CONSUMER .
2 . ORDERS THE COUNCIL OF THE EUROPEAN COMMUNITIES TO PAY THE COSTS .
