1 BY ORDERS DATED 16 JUNE 1975 RECEIVED AT THE COURT REGISTRY ON 8 AUGUST 1975 THE TRIBUNALE AMMINISTRATIVO REGIONALE DEL LAZIO REFERRED , UNDER ARTICLE 177 OF THE EEC TREATY , THREE QUESTIONS ON THE INTERPRETATION OF ARTICLE 30 OF THE EEC TREATY AND THE PROVISIONS OF REGULATION NO 1009/67/EEC OF THE COUNCIL OF 18 DECEMBER 1967 ON THE COMMON ORGANIZATION OF THE MARKET IN SUGAR ( OJ ENGLISH SPECIAL EDITION 1967 , P . 304 ). THESE QUESTIONS HAVE ARISEN IN THE CONTEXT OF ACTIONS FOR THE ANNULMENT OF CERTAIN ORDERS ADOPTED IN 1974 BY THE COMITATO INTERMINISTERIALE DEI PREZZI ( INTER-DEPARTMENTAL COMMITTEE ON PRICES ), WHICH THE PLAINTIFFS CONSIDER INCOMPATIBLE WITH COMMUNITY LAW . THEY ARE ORDERS NOS 9/1974 , 28/1974 AND 39/1974 ( GAZZETTA UFFICIALE NO 52 OF 23 FEBRUARY 1974 , NO 171 OF 2 JULY 1974 AND NO 214 OF 16 AUGUST 1975 ), THE FIRST TWO OF WHICH HAD SUCCESSIVELY FIXED MAXIMUM CONSUMER PRICES FOR SUGAR BOTH OF DOMESTIC AND FOREIGN ORIGIN WHILST THE THIRD HAD SET OUT THE FACTORS MAKING UP THE MAXIMUM PRICES LAID DOWN BY ORDER NO 28/1974 , WHICH FACTORS INCLUDE INTER ALIA THE ' MAXIMUM EX-FACTORY PRICE ' , THE ' MAXIMUM PRICE FREE-AT-WHOLESALER ' S WAREHOUSE ' AND THE ' MAXIMUM CHARGE FOR WHOLESALE AND RETAIL DISTRIBUTION ' .
2 IN VIEW OF THE COMMON GROUND BETWEEN THEM IT IS PROPER TO JOIN THE PRESENT CASES FOR THE PURPOSES OF THE JUDGMENT .
3 IN THE PROCEDURE BEFORE THE COURT DISAGREEMENT WAS REVEALED ON WHETHER AS A WHOLE THESE ORDERS FIXED OBLIGATORY MAXIMUM PRICES ONLY FOR THE SALES IN WHICH THE IMMEDIATE BUYER IS THE ULTIMATE CONSUMER OR WHETHER THEY DID SO FOR SALES MADE AT PREVIOUS MARKETING STAGES AND IN PARTICULAR IN RESPECT OF SALES MADE BY SUGAR GROWERS . IT IS NOT FOR THE COURT TO SETTLE THIS DISPUTE , AND HAVING REGARD TO THE FACT THAT THE QUESTIONS RAISED BY THE NATIONAL COURT MAKE NO DISTINCTION BETWEEN THE DIFFERENT MARKETING STAGES , IT IS PROPER TO CONSTRUE THESE QUESTIONS AS REFERRING IN A GENERAL MANNER TO THE FIXING OF MAXIMUM PRICES FOR THE SALE OF SUGAR WHETHER IT BE A QUESTION OF SALES MADE BY GROWERS , IMPORTERS , WHOLESALERS OR RETAILERS .
ON THE FIRST AND SECOND QUESTIONS
4 THE FIRST AND SECOND QUESTIONS ASK THE COURT TO RULE ON THE ONE HAND ON ' THE COMPETENCE , EXCLUSIVE OR OTHERWISE , OF THE EUROPEAN ECONOMIC COMMUNITY TO EXERCISE LEGISLATIVE POWER TO CONTROL THE PRICES OF SUGAR , AND THE USE MADE OF SUCH POWER IN REGULATION NO 1009/67/EEC AND SUBSEQUENT ADDITIONS THERETO ' AND ON THE OTHER HAND ON ' THE LEGALITY , IN RELATION TO A CONJUNCTURAL POLICY AND TO ARTICLE 103 OF THE TREATY , OF UNILATERAL INTERVENTIONS BY A MEMBER STATE IN THE SECTOR CONCERNED , AND OF THE TYPE IN QUESTION ' .
5 REGULATION NO 1009/67 , ADOPTED WITHIN THE FRAMEWORK OF THE COMMON AGRICULTURAL POLICY , IS INTENDED TO ESTABLISH A COMMON ORGANIZATION OF THE MARKET WITHIN THE MEANING OF ARTICLE 40 OF THE EEC TREATY . THIS COMMON ORGANIZATION OF THE MARKET IS INTENDED , AS IS EMPHASIZED REPEATEDLY IN THE PREAMBLE TO THE REGULATION , TO CREATE FOR THE COMMUNITY A SINGLE MARKET IN SUGAR SUBJECT TO COMMON ADMINISTRATION AND BASED ON A SYSTEM OF COMMON PRICES .
6 AS THE COURT HAS ALREADY INDICATED ( CASE 31/74 , GALLI ( 1975 ) ECR 47 ) IN RESPECT OF NATIONAL RULES FREEZING THE PRICES OF OTHER PRODUCTS AT THE PRODUCTION AND WHOLESALE STAGES ' IN SECTORS COVERED BY A COMMON ORGANIZATION OF THE MARKET - EVEN MORE SO WHEN THIS ORGANIZATION IS BASED ON A COMMON PRICE SYSTEM - MEMBER STATES CAN NO LANGER INTERFERE THROUGH NATIONAL PROVISIONS TAKEN UNILATERALLY IN THE MACHINERY OF PRICE FORMATION AS ESTABLISHED UNDER THE COMMON ORGANIZATION ' SO THAT ' A NATIONAL SYSTEM WHICH BY FREEZING PRICES . . . HAS THE EFFECT OF MODIFYING THE FORMATION OF PRICES AS PROVIDED FOR IN THE CONTEXT OF THE COMMON ORGANIZATION OF THE MARKET , IS INCOMPATIBLE ' WITH THE COMMUNITY RULES . THE SAME JUDGMENT STATED THAT THE PROVISIONS OF A COMMUNITY AGRICULTURAL REGULATION INVOLVING A SYSTEM OF PRICES APPLYING TO THE PRODUCTION AND WHOLESALE STAGES ' LEAVE MEMBER STATES FREE - WITHOUT PREJUDICE TO OTHER PROVISIONS OF THE TREATY - TO TAKE THE APPROPRIATE MEASURES RELATING TO PRICE FORMATION AT THE RETAIL AND CONSUMPTION STAGES , ON CONDITION THAT THEY DO NOT JEOPARDIZE THE AIMS OR FUNCTIONING OF THE COMMON ORGANIZATION OF THE MARKET IN QUESTION ' . THESE CONSIDERATIONS WHICH WERE PUT FORWARD AT THE TIME IN RESPECT OF REGULATIONS NOS 120/67 AND 136/66 ON THE COMMON ORGANIZATION OF THE MARKET IN CEREALS AND OF THAT OF OILS AND FATS RESPECTIVELY ARE EQUALLY VALID FOR THE PURPOSES OF THE INTERPRETATION OF REGULATION NO 1009/67 ON THE COMMON ORGANIZATION OF THE MARKET IN SUGAR IN VIEW OF THE SIMILARITY OF THE RESPECTIVE PRICE SYSTEMS ESTABLISHED BY REGULATIONS NOS 120/67 AND 1009/67 .
7 FROM THE POINT OF VIEW OF COMPATIBILITY WITH THE COMMUNITY RULES ON THE FIXING OF PRICES BY NATIONAL AUTHORITIES A STRICT DISTINCTION BETWEEN MAXIMUM CONSUMER PRICES AND MAXIMUM PRICES APPLICABLE AT PREVIOUS MARKETING STAGES IS DIFFICULT DUE TO THE FACT THAT ON THE ONE HAND PRICE RULES AT THE STAGE OF THE SALE TO THE ULTIMATE CONSUMER MAY WELL HAVE REPERCUSSIONS ON PRICE FORMATION AT THE PREVIOUS STAGES AND THAT ON THE OTHER HAND THE PRICES PRESCRIBED BY THE COMMUNITY SYSTEM IN THE SUGAR SECTOR ARE NOT PRICES APPLICABLE TO PARTICULAR SALES MADE TO DEALERS , INDUSTRIAL USERS OR CONSUMERS . IT MUST BE ADMITTED THAT IN FACT IN THE MATTER OF AGRICULTURAL PRICES NATIONAL RULES FOR THE SAME MARKETING STAGES AS THE SYSTEM OF COMMUNITY PRICES WILL NORMALLY RUN A GREATER RISK OF CONFLICTING WITH THE SAID SYSTEM THAN RULES APPLYING EXCLUSIVELY TO OTHER STAGES . IT MUST THEREFORE BE CONCLUDED THAT THE UNILATERAL FIXING BY A MEMBER STATE OF MAXIMUM PRICES FOR THE SALE OF SUGAR , WHATEVER THE MARKETING STAGE IN QUESTION , IS INCOMPATIBLE WITH REGULATION NO 1009/67 ONCE IT JEOPARDIZES THE OBJECTIVES AND THE FUNCTIONING OF THIS ORGANIZATION AND IN PARTICULAR ITS SYSTEM OF PRICES .
8 IN ORDER TO INDICATE TO THE NATIONAL COURT HOW SUCH INCOMPATIBILITY COULD ARISE IT IS WELL TO CONSIDER THIS SYSTEM IN MORE DETAIL .
9 ACCORDING TO ARTICLE 2 ( 1 ) OF REGULATION NO 1009/67 ' A TARGET PRICE FOR WHITE SUGAR SHALL BE FIXED EACH YEAR FOR THE COMMUNITY AREA HAVING THE LARGEST SURPLUS ' - THAT IS , CERTAIN DEPARTMENTS IN NORTHERN FRANCE . ACCORDING TO ARTICLE 3 ( 1 ) AND ( 2 ) ' AN INTERVENTION PRICE FOR WHITE SUGAR SHALL BE FIXED EACH YEAR ' FOR THE SAID AREA WHEREAS ' DERIVED INTERVENTION PRICES SHALL BE FIXED FOR OTHER AREAS , ACCOUNT BEING TAKEN OF THE REGIONAL VARIATIONS . . . ' ACCORDING TO ARTICLE 9 ( 1 ) OF REGULATION NO 1009/67 ' INTERVENTION AGENCIES DESIGNATED BY SUGAR-PRODUCING MEMBER STATES SHALL BE REQUIRED . . . TO BUY IN . . . SUGAR . . . OFFERED TO THEM . . . AT THE INTERVENTION PRICE VALID FOR THE AREA IN WHICH THE SUGAR IS LOCATED AT THE TIME OF PURCHASE ' WHILE ARTICLE 10 PROVIDES THAT AS A RULE THEY ' MAY ONLY SELL SUGAR ON THE DOMESTIC MARKET AT A PRICE WHICH IS HIGHER THAN THE INTERVENTION PRICE ' . ACCORDING TO THE COMBINED PROVISIONS OF ARTICLE 4 ( 1 ) AND ( 2 ) AND ARTICLE 5 ( 1 ) OF THE REGULATION ' EACH YEAR , FOR EACH BEET SUGAR PRODUCING AREA . . . A MINIMUM PRICE FOR BEET SHALL BE FIXED . . . WHEN THE MINIMUM PRICE FOR BEET IS BEING ESTABLISHED , THE INTERVENTION PRICE FOR WHITE SUGAR IN THE AREA IN QUESTION . . . SHALL BE TAKEN INTO ACCOUNT . . . SUGAR MANUFACTURERS BUYING BEET FOR PROCESSING INTO SUGAR SHALL BE REQUIRED TO PAY AT LEAST THE MINIMUM PRICE FOR SUGAR BEET ' .
10 DURING THE PERIOD IN QUESTION THE DERIVED INTERVENTION PRICE FOR ITALY WAS FIXED AT A HIGHER LEVEL THAN THAT OF THE TARGET PRICE SO THAT IT SUFFICES TO CONSIDER THE QUESTION RAISED BY THE NATIONAL COURT WITH REGARD TO THIS SITUATION .
11 THE COMMUNITY RULES AIM AT ENSURING AS FAR AS POSSIBLE THAT SUGAR MANUFACTURERS MAY OBTAIN , IN THEIR SALES IN THE AREA FOR WHICH A DERIVED INTERVENTION PRICE HAS BEEN FIXED , AN EX-FACTORY PRICE AT LEAST EQUAL TO THIS PRICE . OTHERWISE MANUFACTURERS COULD FIND IT IMPOSSIBLE TO PAY BEET GROWERS THE MINIMUM PRICE WHICH THE COMMUNITY RULES GUARANTEE TO THEM . THUS A MEMBER STATE IN RESPECT OF WHICH THE INTERVENTION PRICE HAS BEEN FIXED AT A LEVEL HIGHER THAN THE TARGET PRICE JEOPARDIZES THE OBJECTIVES AND THE FUNCTIONING OF THE SUGAR MARKETS IF IT REGULATES THE PRICES IN SUCH A WAY AS DIRECTLY OR INDIRECTLY TO MAKE IT DIFFICULT FOR THE SUGAR MANUFACTURERS TO OBTAIN AN EX-FACTORY PRICE AT LEAST EQUAL TO THE SAID INTERVENTION PRICE . SUCH AN INDIRECT OBSTRUCTION EXISTS WHEN THE MEMBER STATE IN QUESTION , WITHOUT REGULATING THE PRICES AT THE PRODUCTION STAGE , FIXES MAXIMUM SELLING PRICES FOR THE WHOLESALE AND RETAIL STAGES AT SUCH A LOW LEVEL THAT THE GROWER FINDS IT PRACTICALLY IMPOSSIBLE TO SELL AT THE INTERVENTION PRICE SINCE IF HE WERE TO DO SO IT WOULD FORCE THE WHOLESALERS OR RETAILERS , BOUND BY THE SAID MAXIMUM PRICES , TO SELL AT A LOSS .
12 IN EVERY CASE IT IS FOR THE NATIONAL COURT TO DECIDE , HAVING REGARD TO THE CONSIDERATIONS WHICH HAVE JUST BEEN SET OUT , WHETHER THE MAXIMUM PRICES WHICH IT IS CALLED UPON TO CONSIDER PRODUCE SUCH EFFECTS AS TO MAKE THEM INCOMPATIBLE WITH THE COMMUNITY PROVISIONS ON SUGAR .
13 IN SO FAR AS A MAXIMUM PRICE UNILATERALLY FIXED BY A MEMBER STATE IS INCOMPATIBLE WITH THE PROVISIONS OF THE AGRICULTURAL LAW OF THE COMMUNITY , THE STATE CONCERNED CANNOT RELY ON THE PROVISIONS OF ARTICLE 103 OF THE TREATY ON CONJUNCTURAL POLICY IN ORDER TO JUSTIFY FIXING THE PRICE , ESPECIALLY AS REGULATION NO 1009/67 COMPRISES A FRAMEWORK OF ORGANIZATION DESIGNED IN SUCH A WAY AS TO ENABLE THE COMMUNITY AND MEMBER STATES TO MEET ALL MANNER OF DISTURBANCES . IN THIS CONNEXION , IT MUST FIRST BE STRESSED THAT IT IS ONE OF THE OBJECTIVES OF ARTICLE 39 ( 1 ) OF THE TREATY THAT SUPPLIES REACH CONSUMERS AT REASONABLE PRICES . ARTICLE 21 ( 1 ) OF REGULATION NO 1009/67 ENABLES THE COUNCIL TO TAKE ALL APPROPRIATE MEASURES IF THE COMMUNITY MARKET IS DISTURBED OR THREATENED WITH DISTURBANCES BY REASON OF IMPORTS OR EXPORTS . THE SECOND PARAGRAPH OF THE SAME ARTICLE INDICATES PRECISELY THE PROCEDURES FOR COMMON ACTION BY THE COUNCIL , THE COMMISSION AND THE MEMBER STATES IN THE ABOVEMENTIONED EVENT . IN ADDITION TO THE POWERS WHICH THE REGULATION RESERVES TO THE COUNCIL AND THE COMMISSION , THE TREATY ITSELF ENTRUSTS THE COMMISSION WITH THE GENERAL TASK OF SUPERVISION AND INITIATION OF MEASURES . IT IS ALSO NECESSARY TO DRAW ATTENTION IN THIS CONNEXION TO THE ROLE PLAYED BY PERMANENT CONSULTATION , IN THE MANAGEMENT OF THE SECTOR AT ISSUE , BY MEANS OF THE ' MANAGEMENT COMMITTEE ' ESTABLISHED BY ARTICLE 39 OF THE REGULATION . BESIDES THE TASKS WITH WHICH IT IS SPECIFICALLY ENTRUSTED , THE MANAGEMENT COMMITTEE MAY , IN FACT , IN THE WORDS OF ARTICLE 41 OF THE REGULATION , CONSIDER ANY OTHER QUESTION REFERRED TO IT BY ITS CHAIRMAN EITHER ON HIS OWN INITIATIVE OR AT THE REQUEST OF THE REPRESENTATIVE OF A MEMBER STATE . IT IS THEREFORE APPARENT THAT THE FRAMEWORK OF ORGANIZATION OF REGULATION NO 1009/67 RESERVES TO EVERY MEMBER STATE THE POWER , IN CONJUNCTION WITH THE COMMUNITY INSTITUTIONS , TO TAKE THE NECESSARY ACTION , IN THE SHORTEST POSSIBLE TIME , WHERE THE NORMAL OPERATION OF THE PRICE MACHINERY ESTABLISHED BY THE REGULATION IS INEFFECTIVE IN THE FACE OF UNDESIRABLE TENDENCIES ASCERTAINED IN THE MOVEMENT OF PRICES IN ITS TERRITORY .
ON THE THIRD QUESTION
14 THE THIRD QUESTION IN SUBSTANCE ASKS WHETHER NATIONAL MEASURES SUCH AS THOSE IN QUESTION ARE COMPATIBLE WITH THE PROHIBITION IN ARTICLE 30 OF THE TREATY ON MEASURES HAVING AN EFFECT EQUIVALENT TO QUANTITATIVE RESTRICTIONS WHEN THE SAID MEASURES ARE JUSTIFIED ' BY THE NEED TO PROTECT THE ECONOMY FROM SPECULATIVE OPERATIONS AND TO GUARANTEE THE NECESSARY CONSUMER SUPPLIES AGAINST THE UPSETTING OF THE CONDITIONS ON WHICH THE COMMUNITY RULES ARE BASED BOTH BY THE DEFICIT IN COMMUNITY PRODUCTION AND BY THE DOUBLING OF THE WORLD PRICE OF THIS PRODUCT ' .
15 ARTICLE 30 OF THE TREATY PROHIBITS IN TRADE BETWEEN MEMBER STATES ALL MEASURES HAVING AN EFFECT EQUIVALENT TO QUANTITATIVE RESTRICTIONS AND THIS PROHIBITION IS REPEATED IN ARTICLE 35 OF REGULATION NO 1009/67 AS REGARDS THE MARKET IN SUGAR . FOR THE PURPOSES OF THIS PROHIBITION IT IS SUFFICIENT THAT THE MEASURES IN QUESTION ARE LIKELY TO CONSTITUTE AN OBSTACLE , DIRECTLY OR INDIRECTLY , ACTUALLY OR POTENTIALLY , TO IMPORTS BETWEEN MEMBER STATES . ALTHOUGH A MAXIMUM PRICE APPLICABLE WITHOUT DISTINCTION TO DOMESTIC AN IMPORTED PRODUCTS DOES NOT IN ITSELF CONSTITUTE A MEASURE HAVING AN EFFECT EQUIVALENT TO A QUANTITATIVE RESTRICTION , IT MAY HAVE SUCH AN EFFECT WHEN IT IS FIXED AT A LEVEL SUCH THAT THE SALE OF IMPORTED PRODUCTS BECOMES , IF NOT IMPOSSIBLE , MORE DIFFICULT THAN THAT OF DOMESTIC PRODUCTS . A MAXIMUM PRICE , IN ANY EVENT IN SO FAR AS IT APPLIES TO IMPORTED PRODUCTS , CONSTITUTES THEREFORE A MEASURE HAVING AN EFFECT EQUIVALENT TO A QUANTITATIVE RESTRICTION , ESPECIALLY WHEN IT IS FIXED AT SUCH A LOW LEVEL THAT , HAVING REGARD TO THE GENERAL SITUATION OF IMPORTED PRODUCTS COMPARED TO THAT OF DOMESTIC PRODUCTS , DEALERS WISHING TO IMPORT THE PRODUCT IN QUESTION INTO THE MEMBER STATE CONCERNED CAN DO SO ONLY AT A LOSS .
16 IT IS FOR THE NATIONAL COURT TO DECIDE WHETHER THIS IS SO IN THE PRESENT CASE .
17 FOR THE REASONS GIVEN IN REPLY TO THE FIRST AND SECOND QUESTIONS THE MEMBER STATE CONCERNED CANNOT BASE ITS JUSTIFICATION OF A MAXIMUM CONSUMER PRICE PRODUCING THE ABOVEMENTIONED EFFECT EITHER ON ARTICLE 103 OF THE TREATY OR ON THE NEED TO PROTECT THE ECONOMY FROM SPECULATIVE OPERATIONS OR ON A CHANGE OCCURRING IN THE ECONOMIC SITUATION IN THE SUGAR SECTOR .
COSTS
18 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES AND THE UNITED KINGDOM AND ITALIAN GOVERNMENTS , WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE , AND AS THESE PROCEEDINGS ARE A STEP IN THE ACTIONS PENDING BEFORE THE NATIONAL COURT THE DECISION ON COSTS IS A MATTER FOR THAT COURT .
ON THOSE GROUNDS ,
THE COURT
IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE TRIBUNALE AMMINISTRATIVO REGIONALE DEL LAZIO BY ORDERS OF 16 JUNE 1975 , HEREBY RULES :
1 . THE UNILATERAL FIXING BY A MEMBER STATE OF MAXIMUM PRICES FOR THE SALE OF SUGAR , WHATEVER THE MARKETING STAGE IN QUESTION , IS INCOMPATIBLE WITH REGULATION NO 1009/67 ONCE IT JEOPARDIZES THE OBJECTIVES AND THE FUNCTIONING OF THIS ORGANIZATION AND IN PARTICULAR ITS SYSTEM OF PRICES .
2 . A MAXIMUM PRICE , IN ANY EVENT IN SO FAR AS IT APPLIES TO IMPORTED PRODUCTS , CONSTITUTES THEREFORE A MEASURE HAVING AN EFFECT EQUIVALENT TO A QUANTITATIVE RESTRICTION , ESPECIALLY WHEN IT IS FIXED AT SUCH A LOW LEVEL THAT , HAVING REGARD TO THE GENERAL SITUATION OF IMPORTED PRODUCTS COMPARED TO THAT OF DOMESTIC PRODUCTS , DEALERS WISHING TO IMPORT THE PRODUCT IN QUESTION INTO THE MEMBER STATE CONCERNED CAN DO SO ONLY AT A LOSS .
3 . IN SO FAR AS A MAXIMUM PRICE FIXED UNILATERALLY BY A MEMBER STATE IS INCOMPATIBLE WITH ARTICLE 30 OF THE TREATY OR THE PROVISIONS OF THE AGRICULTURAL LAW OF THE COMMUNITY THE MEMBER STATE CONCERNED CANNOT BASE ITS JUSTIFICATION FOR THIS FIXING EITHER ON ARTICLE 103 OF THE TREATY OR ON THE NEED TO PROTECT THE ECONOMY FROM SPECULATIVE OPERATIONS OR ON A CHANGE OCCURRING IN THE ECONOMIC SITUATION IN THE SUGAR SECTOR .
