In Case C-352/92,
REFERENCE to the Court under Article 177 of the EEC Treaty by the Finanzgericht Duesseldorf (Germany) for a preliminary ruling in the proceedings pending before that court between
Milchwerke Koeln/Wuppertal eG
and
Hauptzollamt Koeln-Rheinau,
on the interpretation and validity of Article 12(4) of Commission Regulation (EEC) No 1371/84 of 16 May 1984 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68 (OJ 1984 L 132, p. 11), Article 12(4) of the same regulation, as amended by Commission Regulation (EEC) No 3005/85 of 29 October 1985 (OJ 1985 L 288, p. 10), and Article 15(4) of Commission Regulation (EEC) No 1546/88 of 3 June 1988 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68 (OJ 1988 L 139, p. 12),
THE COURT (Third Chamber),
composed of: J.C. Moitinho de Almeida, President of the Chamber, F. Grévisse and M Zuleeg (Rapporteur), Judges,
Advocate General: W. Van Gerven,
Registrar: H.A. Ruehl, Principal Administrator,
after considering the written observations submitted on behalf of:
° Michwerke Koeln/Wuppertal eG, by Lueder Meyer-Arndt, of the Cologne Bar,
° the Commission of the European Communities, by Dierk Booss, Legal Adviser, acting as Agent, assisted by Hans-Juergen Rabe, of Schoen, Nolte, Finkelnburg and Clemm, Hamburg and Brussels,
having regard to the Report for the Hearing,
after hearing the oral observations of the plaintiff in the main proceedings and the Commission at the hearing on 30 September 1993,
after hearing the Opinion of the Advocate General at the sitting on 10 November 1993,
gives the following
Judgment
1 By order of 18 August 1992, received at the Court on 9 September 1992, the Finanzgericht (Finance Court) Duesseldorf (Germany) referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty three questions on the interpretation and validity of Article 12(4) of Commission Regulation No 1371/84 of 16 May 1984 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation No 804/68 (OJ 1984 L 132, p. 11), Article 12(4) of the same regulation, as amended by Commission Regulation No 3005/85 of 29 October 1985 (OJ 1985 L 288, p. 10), and Article 15(4) of Commission Regulation No 1546/88 of 3 June 1988 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation No 804/68 (OJ 1988 L 139, p. 12).
2 Those questions were raised in proceedings between Milchwerke Koeln/Wuppertal eG and the Hauptzollamt Koeln-Rheinau concerning an additional levy which the former is allegedly liable to pay on account of a retroactive reduction of reference quantities resulting from a miscalculation of those quantities for which it was held responsible.
3 The plaintiff in the main proceedings is the universal successor of Milchversorgung Rheinland eG, which merged with it. The latter purchased milk from affiliated producers, who were also its members. Before the merger, some of its senior officers intentionally caused the reference quantity allocated to several members to be miscalculated, with the result that the quantities allocated were too high. Milchversorgung Rheinland paid over to the competent body the additional levy arising as a result of deliveries in excess of those inaccurate reference quantities.
4 As a result of audits carried out in 1989, in 309 cases the Hauptzollamt retroactively revoked the reference quantity which had been miscalculated, replacing it with a lower reference quantity. By notices of assessment dated 12 and 14 June 1991, it claimed from the plaintiff in the main proceedings, in its capacity as the person liable, a sum totalling DM 5 975 480.49 by way of unpaid additional levies.
5 As the objection it lodged with the Hauptzollamt was largely unsuccessful, the plaintiff brought an action before the Finanzgericht Duesseldorf for the annulment of the aforesaid notices.
6 Taking the view that its decision depended upon the interpretation and validity of the Community rules at issue, the national court stayed the proceedings and referred the following questions to the Court for a preliminary ruling:
"1. Where formula A as provided for in Article 5c(1) of Regulation (EEC) No 804/68 is applied, is the purchaser liable, under the original version of Article 12(4) of Regulation (EEC) No 1371/84, to pay the additional levy which has arisen as a result of retroactive reductions in the delivery reference quantities, where his employees were responsible for setting the delivery reference quantities and were therefore responsible for the additional levy' s not having been paid in full?
2. In the same circumstances as those described in Question 1, is the purchaser liable to pay the additional levy under Article 12(4) of Regulation (EEC) No 1371/84 in the version laid down in Regulation (EEC) No 3005/85 and Article 15(4) of Regulation (EEC) No 1546/88?
3. In the event that Questions 1 and 2 are answered in the affirmative, are Article 12(4) of Regulation (EEC) No 1371/84 and Article 15(4) of Regulation (EEC) No 1546/88 valid in so far as where formula A is applied they provide inter alia that the purchaser is liable to pay the levy?"
7 In its order for reference, the national court considers that the interpretation of the aforesaid provisions does not support the Hauptzollamt' s argument to the effect that, even under formula A (the producer formula) the additional levy is payable by the plaintiff in the main proceedings, in its capacity as the purchaser. According to the national court, that solution has no legal basis.
8 The first point to note is that in order to curb the increase in milk production on the Community market, while permitting the structural developments and adjustments required, Article 5c of Council Regulation (EEC) No 804/68 of 27 June 1968 on the common organization of the market in milk and milk products (OJ, English Special Edition (1968) I, p. 176), as supplemented by Council Regulation (EEC) No 856/84 of 31 March 1984 (OJ 1984 L 90, p. 10), introduced for a period of five years an additional levy payable by producers or purchasers of cows' milk.
9 That article provided for the implementation of the levy system in accordance with one of the following formulas.
Formula A
A levy is payable by every milk producer on the quantities of milk and/or milk equivalent which he has delivered to a purchaser and which, over a period of 12 months, exceed a reference quantity to be determined.
Formula B
A levy is payable by every purchaser of milk or other milk products on the quantities of milk or milk equivalent which have been delivered by producers and which, over a period of 12 months, exceed a reference quantity to be determined.
10 Under formula A, the levy is to be collected from each producer by the purchaser, pursuant to Article 9(2) 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).
The first two questions
11 By these two questions, which should be considered together, the national court asks whether Article 12(4) of the original version of Regulation No 1371/84, Article 12(2), now Article 12(4), of the same regulation, as amended by Regulation No 3005/85, and Article 15(4) of Regulation No 1546/88 are to be interpreted as meaning that, under formula A, only the producers and not the purchaser are liable for payment of the balance payable by way of the additional levy on milk, even where the balance is due as a result of the retroactive reduction in the producers' reference quantities and the initial miscalculation of those quantities was attributable to the misconduct of the purchaser or his agents.
12 It is apparent from the order for reference that, in the Hauptzollamt' s view, under formula A only milk producers are in principle liable to pay the additional levy. However, it infers from Article 12 of Regulation No 1371/84 and Article 15(4) of Regulation No 1546/88 that, in circumstances such as those of the present case, in which the purchasers are responsible for the amount of the additional levy collected being too low, they are required to pay the balance due themselves.
13 The Hauptzollamt' s argument cannot be accepted.
14 The Community legislature left to the Member States the choice between formula A and formula B, under each of which the person liable is different.
15 As the Federal Republic of Germany has chosen formula A, the producers alone are liable for payment of the additional levy on milk. Accordingly, a milk purchaser such as the plaintiff in the main proceedings is not liable to pay the additional levy.
16 A purchaser cannot be held liable for payment of the additional levy under the provisions referred to in the questions submitted, which require purchasers to pay over to the competent body the amount of the levy collected from each producer.
17 It is clear from the mechanism introduced that, although the purchaser is obliged to pay over the amounts collected, he is not liable to pay the additional levy himself.
18 The regulations adopted by the Commission for the application of the levy system have not made any changes as regards the trader liable to pay the additional levy. Under Article 12(4) of the original version of Regulation No 1371/84, to which the Hauptzollamt refers, the producer remains liable for payment of the balance owed in the event of the amount paid by way of the additional levy being lower than that which was actually payable.
19 According to the Hauptzollamt, it should be possible to derogate from that system in the event of irregularities on the part of a purchaser in calculating the reference quantities initially allocated.
20 That solution cannot be accepted.
21 The additional levy system in the Community does not provide for the substitution of the purchaser for the producer as the person liable in the event of irregularities on the part of the purchaser in fixing the amount of the levy which he is responsible for collecting. The uncollected amount is still payable by the producer.
22 Notwithstanding the need to combat fraudulent transactions, a penalty consisting in the substitution of the purchaser for the producer presupposes the existence of a legal basis laying down the conditions for, and the scope of, that penalty.
23 It is for the Member States to combat fraud effectively. According to the Court, where a Community regulation does not specifically provide any penalty for an infringement or refers for that purpose to national laws, regulations and administrative provisions, Article 5 of the Treaty requires the Member States to take all measures necessary to guarantee the application and effectiveness of Community law (see the judgment in Case 68/88 Commission v Greece [1989] ECR 2965, paragraph 23, and in Case C-326/88 Hansen [1990] ECR I-2911, paragraph 17, and the order in Case C-2/88 Imm. Zwartveld and Others [1990] ECR I-3365, paragraph 17 in fine). As the Advocate General pointed out in paragraph 17 of his Opinion, the obligation based on Article 5 of the Treaty also extends to the initiation of any proceedings under administrative, fiscal or civil law for the collection or recovery of duties or levies which have been fraudulently evaded or for damages.
24 In the light of the foregoing considerations, the answer to the first two questions must be that Article 12(4) of Regulation No 1371/84 in its original version, Article 12(2), now Article 12(4), of the same regulation, as amended by Regulation No 3005/85, and Article 15(4) of Regulation No 1546/88 must be interpreted as meaning that, under formula A, only the producers and not the purchaser are liable for payment of the balance payable by way of the additional levy on milk, even where the balance is due as a result of the retroactive reduction of the producers' reference quantities and the initial miscalculation of those quantities was attributable to the misconduct of the purchaser or his agents.
Third question
25 In view of the answer to the first two questions, the third question is devoid of purpose.
Costs
26 The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.
On those grounds,
THE COURT (Third Chamber),
in answer to the questions referred to it by the Finanzgericht Duesseldorf by order of 18 August 1992, hereby rules:
Article 12(4) of the original version of Commission Regulation (EEC) No 1371/84 of 16 May 1984 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68, Article 12(2), now Article 12(4), of the same regulation, as amended by Commission Regulation (EEC) No 3005/85 of 29 October 1985, and Article 15(4) of Commission Regulation (EEC) No 1546/88 of 3 June 1988 laying down detailed rules for the application of the additional levy referred to in Article 5c of Regulation (EEC) No 804/68 must be interpreted as meaning that, under formula A, only the producers and not the purchaser are liable for payment of the balance payable by way of the additional levy on milk, even where the balance is due as a result of the retroactive reduction of the producers' reference quantities and the initial miscalculation of those quantities was attributable to the misconduct of the purchaser or his agents.
