Opinion of the Advocate-General
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My Lords,
The National Dried Fruit Trade Association represents importers and distributors of dried fruits in the United Kingdom . In proceedings in the High Court of England and Wales it challenges the validity of Community legislation imposing a minimum import price ( MIP ) and a countervailing charge on imports below the MIP, for dried grapes, other than currants, imported into the Community from third countries, which legislation is implemented by the Commissioners of Customs and Excise . The question in issue is of importance to the members of the Association, since the United Kingdom is a substantial importer of dried grapes, and to similar traders in some other Member States; it is also important to producers in Greece, at the relevant time the only Member State producing dried grapes other than currants, namely that species known as sultanas .
The High Court has referred two questions to the court under Article 177 of the EEC Treaty :-
"( 1 ) Whether Commission Regulation ( EEC ) No 2742/82 ( as amended from time to time ) was when introduced or as continued at any time ( and if so when ) invalid and unlawful because it provided for measures which are not authorized by Council Regulations ( EEC ) Nos 516/77 ( and in particular Article 14 thereof ) and 521/77 and/or as containing provisions and having effects which were disproportionate to the aims of those regulations and/or because it was not adequately reasoned .
( 2 ) Whether Council Regulation ( EEC ) No 2089/85 and Commission Regulation ( EEC ) No 2237/85 and/or Commission Regulation ( EEC ) No 2238/85 ( as amended ) are invalid and unlawful as containing provisions and having effects which are disproportionate to any aims for which those regulations were introduced and/or as being inadequately reasoned ."
The first question relates to regulations laying down the MIP and countervailing charge between 1982 and 1985; the second to regulations providing for such a system from 1 September 1985 . I refer to them as "the first MIP system" and "the second MIP system" respectively .
The first MIP system
The basic regulation on the common organisation of the market in products processed from fruit and vegetables ( including dried grapes ) at the relevant time was Council Regulation No 516/77 which provides inter alia a common price and levy machinery ( Official Journal 1977, L 73, p . 1 ), as amended from time to time .
In the twelfth recital it was recognized that "... the common price and levy machinery may prove inadequate in exceptional circumstances; whereas to ensure that in such cases the Community market is not left completely exposed to the disturbances which might result, the Community should be allowed to take any appropriate action as quickly as possible ... "
Accordingly, Article 14 ( 1 ) provided that : "if, by reason of imports or exports, the Community market in one or more of the products specified in Article 1 is or is likely to be exposed to serious disturbances which might endanger the objectives set out in Article 39 of the Treaty, appropriate measures may be applied in trade with non-Member countries until such disturbances or threat thereof have ceased ."
Dried grapes are included amongst such products .
Detailed rules for the application of these provisions were laid down in Council Regulation No 521/77 ( Official Journal 1977 L 73, p . 28 ). The regulation recited that the measures taken pursuant to Article 14 are to cease to apply once the disturbance or threat of disturbance has ceased; they must be suited to the circumstances if they are not to have other than the desired effects . In deciding whether an actual disturbance or a threat of disturbance exists, account is to be taken inter alia of the volume of imports effected or foreseen, the quantities of products available on the Community market, prices and the trends of prices for Community products on the Community market and,
"( d ) where the abovementioned situation arises as a result of imports, the prices obtaining on the Community market, at a comparable stage for products from third countries, and in particular any excessive downward trend in these prices ."
In the event that serious disturbances exist or are threatened, Article 2 provides that where required import certificates may be discontinued or refused, and where not required, imports may be suspended in whole or in part . It also provides :
"1 . ...
( c ) for all products :
the introduction of arrangements under which, if the price for an imported product falls below a certain minimum, a condition may be imposed whereby that product may be imported only at a price which is at least equal to such minimum,"
Further,
"2 . The measures referred to in paragraph 1 may be taken only to such extent and for such length of time as is strictly necessary . ... They may be restricted to ... particular qualities or types of presentation ... ."
Commission Regulation No 2742/82 ( Official Journal 1982, L 290, p . 28 ) recited that protective measures were needed for dried grapes other than currants because the prices of imports in the marketing year 1981/82 had significantly undercut Community prices leaving, in October 1982, stocks of sultanas equal to 60% of the harvest for that year and exposing the Community market to serious disturbances which might endanger the objectives set out in Article 39 of the Treaty .
A minimum price of ECU 106.7 per 100 kilograms net for imports of dried grapes other than currants was fixed and by Article 2 ( 2 ): "If the minimum price is not respected a countervailing charge of ECU 16.0 per 100 kilograms net shall be applied ".
The Association contends that the Commission Regulation constituting the first MIP system was invalid because it was ultra vires, it infringed the principle of proportionality and failed to give reasons which satisfied Article 190 of the Treaty .
As to vires it is said, first, that there was no express power in Article 14 of Regulation No 516/77 or Article 2 ( 1 ) of Regulation No 521/77 to impose a countervailing charge at all and Article 13(2 ) of Regulation No 516/77 excluded the levying of any charge equivalent to a customs duty and the imposition of any measure having equivalent effect to a quantitative restriction . That is undoubtedly correct .
Then it is said that there was no implied power to impose a countervailing charge at all; the Association points to the fact that before the second MIP system was introduced, Article 4 ( a ) was inserted into Regulation No 516/77 expressly authorizing the imposition of a countervailing charge ( Council Regulation No 988/84 ( Official Journal 1984, L 103, p . 11 ). This, it is said, underlined the fact that it was not there before .
I do not accept this latter argument . If a question had been raised as to whether there was an implied power it was sensible to introduce an express provision . The question remains whether the power was already to be implied in the regulation .
The Commission relies on the Court' s judgment in Joined Cases 41 to 44/70 International Fruit Co . v Commission (( 1971 )) ECR 411 and Case 345/82 Woensche v Germany (( 1984 )) ECR 1995 . In the latter case which was concerned with Article 14 ( 1 ) of Regulation No 516/77 and Article 2(1 ) of Regulation No 521/77, the Court held that "since the Commission was entitled to take protective measures leading to complete suspension of imports from third countries, it was, a fortiori, entitled to adopt less restrictive measures ".
I do not consider that it can be said that to impose a countervailing charge at all was ultra vires . A countervailing charge is an instrument by which the MIP can be enforced and I would accept in principle both that there is an implied power to use such an instrument for such a purpose and that an MIP plus a countervailing charge are capable of being protective measures less restrictive than a total suspension of imports or refusal of licences .
The more difficult question is whether this particular countervailing charge was ultra vires .
The first argument raised is that a flat-rate charge does not necessarily satisfy the condition imposed by Article 2 ( 1 ) of Regulation No 521/77 in that it may not ensure that the import price plus the countervailing charge is "at least equal to such minimum" import price .
Commission Regulation No 2742/82 recites that the countervailing charge (" tax ") should be calculated on the basis of the prices applied by the main non-Member States . This clearly entitles the Commission to fix a countervailing charge which ensures that even the lowest prices are raised by the countervailing charge above the import price . Theoretically the Commission could fix a lower charge so that the import price of some goods plus the countervailing charge would still be less than the MIP and, if it did so, these importations would be in breach of Article 2 of Regulation No 2742/82 . There is, however, nothing to indicate that the charge fixed in the present case did allow goods to come in below the MIP . If there was evidence that the charge did produce such a result, different considerations would arise but I do not consider that the mere fact of applying a fixed rate charge is ultra vires on this ground .
Then it is said that this Commission regulation was invalid because it covered all dried grapes other than currants . The Association contends that dried grapes include both sultanas and raisins . They are produced in a different way, have different qualities and different culinary uses . Thus, sultanas are dried in the shade, coated with a product to keep them soft, whereas raisins are dried in the sun, are not coated and are much less soft . The Netherlands Government points out that the distinction between them is recognized in Regulation No 426/86 ( Official Journal 1986, L 49, p . 1 ) which now governs the relevant common organization of the market . It is said that "raisins" are not produced in the Community and not even used in some Member States; sultanas, on the other hand, are produced in substantial quantities in Greece and used throughout the Community . Therefore, there can be no justification for imposing the countervailing charge ( or it seems to follow the MIP ) in respect of raisins ( as opposed to sultanas ) since raisins were not a Community product which needed protection .
On the other hand, the Greek Government and the Commission point to heading 08.04 of the Common Customs Tariff which specifies only two categories of dried grapes "currants and others ". The Greek Government and the Commission contend that if dried grapes are not currants they are raisins . Sultanas and raisins are interchangeable and indeed there exists commercially a product called "sultana raisins ".
The Commission' s argument that the Common Customs Tariff refers only to "currants" and "other dried grapes" does not assist since the question remains as to whether there is more than one type of "other" dried grapes .
Although questions of fact of this kind, if they have to be resolved, are essentially for the national court from which a reference comes, it seems to me that the point made by the Association ( that the names "sultanas" and "raisins", even if they both come from the same type of seedless grape, are not coterminous ), can be accepted for the purposes of this reference . Recital 1 to Regulation No 2742/82 refers to "sultanas" harvested in the Community and at the end of the day the Council, and I think the Commission, really acknowledge that sultanas are one sort of raisin, sultanas thus being in some respects different from other raisins . This concession seems consistent with eating habits or tastes in at any rate some Member States .
On the other hand, even accepting that there are differences between sultanas and raisins ( or other raisins ), it does not seem to me to follow that an MIP and a countervailing charge for all dried grapes other than currants was ultra vires . Importation of one product not produced in the Community may be capable of threatening a serious disturbance of the Community market in a product produced in the Community, if the two have sufficiently similar qualities and if the products are to a sufficient degree actually used or potentially capable of being used for comparable purposes . Article 14 ( 1 ) of Council Regulation No 516/77 does not limit the measures which may be taken to imports of the same product . Although it seems to me prima facie that there are differences between "sultanas" and what in popular parlance in at any rate some Member States would be called "raisins", I do not find it possible to say in a reference of this kind, and without findings of fact by the trial court, that there was no degree of interchangeability between the two products and that it was necessarily ultra vires for the Commission to take appropriate measures in respect of all dried grapes other than currants .
Leaving aside for the moment the question whether on the facts it was justified to impose a countervailing charge in the first place, and to continue it as long as it was continued, the other arguments as to vires overlap with those advanced in support of the contention that this charge was disproportionate and it is convenient to consider these arguments together . It is said that to impose this countervailing charge went beyond what was reasonably necessary to achieve a legitimate purpose and was penal, arbitrary and uncertain . It was, therefore, not within the Commission' s power to adopt it as a legitimate instrument for enforcing the MIP; in addition the system adopted violated the overriding principle of proportionality .
The Association contends that the system adopted was one which created great uncertainty . The importer could not know until goods were entered for customs purposes whether he had respected the MIP; if in the result he had not done so through no fault of his own the penalty was unjustifiably harsh .
This contention, it is argued, is based on commercial realities . The contract price has to be fixed well before the goods are entered for customs purposes . It is fixed by international practice in United States dollars and on import that price has to be translated into national currency . The minimum price expressed in ecus and the countervailing charge ( expressed in ecus ) have to be converted into national currencies adjusted by a coefficient . Comparison of the import price and the corresponding MIP has to be made on the day of completion of the customs import formalities ( Articles 2 and 3 of Regulation No 2742/82 ). During the period of the first MIP system, the MIP changed three times; the coefficients were changed 18 times and the rate used by the customs authority to convert US dollars into pounds sterling changed 107 times . When coefficients were changed the previous rate was maintained in respect of goods which had already left the country of export so long as they were imported within a fixed period . This ensured some price stability . None the less it is argued and not challenged that when the necessary comparisons were made, goods which at the exchange rate prevailing on the contract date were sold at or above the MIP were frequently, on entry for import, found to be below that price . In the result the full countervailing charge had to be paid, which at one point was equal in amount to 25% of the MIP . This it is said might be justified if the price as converted was below the MIP to that extent . It was wholly unjustified and ultra vires to adopt a system which required the full countervailing charge to be paid when the import price, as converted, was only partially, even marginally, below the MIP .
The Commission accepts that at a time of considerable fluctuation in dollar parities a trader could find that a price above the MIP at contract date was below it on import date . It says that traders should have conducted their dealing in German marks to avoid this result . That to my mind is not a sufficient answer . If other methods of attaining the object of the regulations are available it seems to me that to require international trade practice to be changed to meet a serious disturbance of the market ( and only for such period as that disturbance exists or is threatened ) is wholly disproportionate if indeed practicable . Nor is it a sufficient justification that by Regulation No 2186/83 ( Official Journal 1983, L 210, p . 11 ) it was made possible for a trader to lodge an undertaking to pay the MIP converted into national currency at the date of application plus 4%, since as the Association asserts and the Commission does not contest, this was unattractive since margins were below 4 %.
In support of its contention that to levy the full countervailing charge irrespective of the amount by which the MIP was not attained was disproportionate and ultra vires, the Association relies on the Court' s judgment in Case 240/78 Atalanta v Produktschap Voor Vee En Vlees (( 1979 )) ECR 2137 and the judgment of 24 September 1985 in Case 181/84 E . D . & F . Man ( Sugar ). There it is said to be accepted that any penalty must be commensurate with the degree of failure to fulfil the relevant obligation or with the seriousness of the breach of that obligation . These cases are not on all fours with the present since they concern the levying of a penalty to enforce a secondary rather than a primary obligation . Nevertheless they are of guidance in this case .
It seems to me that the essence of the scheme was to maintain an MIP in a product which was partially produced in the Community and which the Community needed to import . Unlike the Woensche case, where importers knew that a penalty would be payable if a quantitative threshold was exceeded, and could opt not to import, in the present case traders would not know until the relevant comparison was made on the basis of the parities and coefficients then prevailing whether they had respected the MIP . It would in my view have been legitimate and proportionate to require them to pay the shortfall; it goes far beyond what is necessary to maintain an MIP to require traders to pay the full countervailing charge whatever the shortfall . Such a charge has become a discriminatory penalty and ceased to be the necessary instrument for enforcing the MIP which can be implied into the first MIP system . I accept, therefore, that to the extent that provision was made for the countervailing charge to be more than the difference between the import price and the MIP at the date of completion of the customs import formalities, Regulation No 2742/82 was ultra vires the Commission and in breach of the principle of proportionality .
The Association then contends that in fact the MIP was frequently fixed at a level higher than Community prices and at some periods very considerably higher . Since the first MIP system was introduced to combat imports of third countries at "abnormally low prices" it is argued that it could not be justified to fix the MIP well above that Community price .
To the extent that the MIP was fixed at a level ( other than de minimis ) above the highest price prevailing in the Community for sultanas it seems to me that it cannot be said that it was necessary to achieve the aim of the legislation ( Case 66/82 Fromançais SA v Forma (( 1983 )) ECR 395 ). Whether it did so, however, depends on a detailed investigation of the facts - the level of Community prices at different periods . That seems to me not to be an exercise which can be undertaken by the Court on a preliminary reference . If the facts are found ( as they have not so far been found by the national court ) then it can be seen whether the MIP was fixed at a level which was unjustifiably high .
The Association next contends that the charge levied applied indiscriminately to importations of packed goods and goods imported in bulk . Since packing is expensive this was an inducement to import packed goods; the effect of this was damaging to packers in the country of importation and to importers including members of the Association who had their own packing facilities . The Commission replies that packed goods should have no difficulties in reaching the MIP and it would have been wrong to fix an MIP at a level reflecting prices applicable to packed goods which also applied to bulk goods . Although there seems force in the Association' s contention I am not satisfied on the evidence before the Court that it can be said that this factor of itself rendered the scheme ultra vires .
Finally, under this head it is said that if the goods bought were, on receipt, found to be below contract quality, e.g . damaged or dirty, any price reduction negotiated or awarded in a commodity arbitration was deducted from the import price . In the result the final price might be found to be below the MIP and the countervailing charge be payable .
The Commission replies ( a ) that the goods should be inspected before they enter the Community, and ( b ) that a clause should have been included in the contract of sale that if a defect in the goods led to compensation which under the MIP system made the importer liable for the countervailing charge, the seller should pay the amount of that charge to the importer . The Commission' s first argument seems to me to be unrealistic; the second to impose an undue burden on the importer .
The regulation does not itself specify that price be taken after deduction of compensation agreed or awarded subsequent to importation so that it cannot be said to be ultra vires on its face value for this reason . It seems to me, however, that the regulation intended that the import price ( to be compared with the MIP ) should be taken as the import price for goods assumed to be of contract quality . If it is shown that in a particular case the import price was reduced by the amount of any compensation for defective quality that in my view was a misapplication of the scheme . This, however, involves questions of fact to be decided by the national court .
A more fundamental argument advanced is that there was no justification to introduce this scheme at all or to keep it in force for the full period during which it was kept in force .
It seems to me, on the recitals to Regulation No 2742/82 and on the facts agreed that it cannot be said that at the time of its introduction the MIP and a countervailing charge otherwise valid were unjustified . For whatever reason, perhaps because in the preceding period prices had been kept high in anticipation of the accession of Greece to the Community, stocks of sultanas were high and the prices of third-country dried grapes were falling and imports of them rising . To fix an MIP with an appropriate countervailing charge was therefore within the Commission' s powers .
It is said, however, that this regulation was kept in being longer than was justified . Since the 1981/82 marketing year, Greek supplies of sultanas were used up during the first three months of the year . Supplies of sultanas were needed until the new harvest in Greece . Raisins had to be imported throughout the year . On any view stocks of dried grapes at the end of each year were low - in no way comparable with the 52 500 tonnes held at the end of the 1981/82 marketing year . At the end of the 1982/83 marketing year they were 7 000 tonnes; at the end of 1983/84 stocks were down to 1 000 tonnes . The Association argues that these measures taken were no longer justified, not least since third-country prices rose . Even in 1983 the Commission proposed to the Council a change from emergency measures to a permanent market system ( Official Journal 1983, C 94, p . 3 ).
The Commission replies that the justification is that stock levels were kept down; if the MIP and the countervailing charge had not been preserved levels would have risen again .
There are no findings of fact on these matters . In the absence of such findings it does not seem to me that the Court can rule as to the actual effects of the regulation as asked to do in the reference . What, however, can be said is that this regulation could only validly take appropriate measures to avoid the effect or the threat of serious disturbances to the market in dried grapes other than currants . Once those disturbances or a threat of such serious disturbances ceased to exist there was no legal basis for the maintenance of the regulation . This is made clear by the recital in Regulation No 521/77 that such measures are to cease to apply once the disturbance or threat of disturbance has ceased and by Regulation No 2742/82 itself which says that the aim of the measures should be to prevent imported dried fruits being marketed at abnormally low prices . I accept the argument of the Netherlands Government that it would be ultra vires to maintain the system as an instrument of market regulation rather than as a protective measure to deal with an emergency . If the national court finds that such disturbances or the threat of such disturbances ceased to exist then it is open to it to find that Regulation No 2742/82 ceased to have any valid basis and could not lawfully be applied .
The Association' s third line of attack against the first MIP system is that the regulation does not contain sufficient reasons to satisfy Article 190 of the EEC Treaty . First, there is no explanation as to why the protective measures were applied to raisins or any indication that the Commission had considered the market situations arising in respect of different types of dried grapes . The only reason given in the various regulations continuing Regulation No 2742/82 was that "import prices remain too low" whereas, as already mentioned, Article 1 of Regulation No 521/77 set out several factors which had to be taken into account . Furthermore, whereas the fourth recital to Regulation No 2742/82 states that the countervailing charge is to be calculated "on the basis of the prices applied by the main non-Member countries", in practice the charge had no consistent arithmetical relationship with world prices . Thus the reasoning was belied in practice .
The Commission replies that the reasoning of Regulation No 2742/82 and each of the regulations extending or amending it is sufficient and clear . In particular, the requirements of Article 1 of Regulation No 521/77 were carefully considered . It points to the Court' s case-law on the reasoning of regulations, as opposed to individual decisions, in particular Case 5/67 Beus v HZA Moenchen (( 1968 )) ECR 83 in which the Court said ( p . 95 ):
"It is a question in the present case of a regulation, that is to say, a measure intended to have general application, the preamble to which may be confined to indicating the general situation which leads to its adoption, on the one hand, and the general objectives which it is intended to achieve on the other .
Conseqently, it is not possible to require that it should set out the various facts, which are often very numerous and complex, on the basis of which the regulation is adopted, or a fortiori that it should provide a more or less complete evaluation of those facts ."
Bearing in mind the Court' s dictum in the Beus case, it seems to me on balance that the recitals to Regulation No 2742/82 do sufficiently set out the matters referred to in Article 1 of Regulation No 521/77 . As already noted, specific reference is made in the recitals to sultanas as a subgroup within "dried grapes ". I think the reasoning can be criticized for not making more explicit the Commission' s reasons for applying the protective measures to other kinds of dried grapes not produced in the Community . However, I am not satisfied that that defect is such as to jeopardize the regulation' s validity . The overall purpose and intention is clear .
The second MIP system
The first MIP system was replaced by the second MIP system with effect from 1 September 1985 . The legal basis of the second MIP system is not Article 14 of Regulation No 516/77 but Article 4a of that Regulation, which was inserted by Council Regulation No 988/84 ( Official Journal 1984, L 103, p . 11 ). That regulation was designed to adjust and unify the system of production aid applying inter alia to dried grapes . The tenth recital reads as follows :
"... in the case of certain products in this sector of which the Community is a major importer, a minimum import price system should be introduced in order to encourage greater market stability and facilitate the proper operation of the aid system, combined with countervailing charges to ensure that minimum prices are observed ".
The new Article 4a imposes an MIP for, inter alia, dried grapes which, according to paragraph 2, shall be determined having regard to the free-at-frontier prices on import into the Community, the prices obtaining in international trade, the situation on the internal Community market and the trend of trade with third countries . By paragraph 3 "where the minimum import price is not observed, a countervailing charge in addition to customs duty shall be imposed, based on the prices of the main supplier countries outside the Community ". Thus there is express provision for a countervailing charge .
The general rules for the implementation of the second MIP system were established by Council Regulation No 2089/85 ( Official Journal 1985, L 197, p . 10 ) and the detailed rules are set out in Commission Regulation No 2237/85 ( Official Journal 1985, L 209, p . 25 ). The MIP and countervailing charges for the 1985/6 marketing year were fixed in Commission Regulation No 2238/85 ( Official Journal 1985 L 209, p . 26 ). These are the regulations at issue in the second part of the reference .
The principal differences identified by the Association between the two systems are, first, that the Council provides for the possibility of account being taken of differences in value between packed and unpacked fruit ( Article 1 ( 3 ) of Regulation No 2089/85 ) although this possibility has not been taken up in the Commission' s implementing regulation; second, that Article 2 of the Council regulation lays down a sliding scale depending on the difference between the MIP and the contract price ( which is still assessed at time of import, however ) and, third, that the coefficients are now assessed every two months whereas previously they could change each week . However, the Association claims that the last advantage is offset by the withdrawal of the standstill provision for goods in transit obtaining under the first MIP system to which reference has already been made .
The Association' s challenge to the validity of the second MIP system is not directed towards the legality of an MIP system per se or to the imposition of a countervailing charge per se, since this is now expressly authorized, but to its detailed implementation in which the Community authorities are again said to have breached the principle of proportionality and failed in their duty to give reasons . Many of the previous arguments in this respect are incorporated by reference .
The Association argues again that the principle of proportionality has been breached because there can be no justification for taking measures to stabilize the market in raisins, which are not produced in the Community, and that the measures are also vitiated by failure to give any reasons why steps were taken to stabilize the market in raisins .
Again, it is contrary to the principle of proportionality to continue this system during periods ( such as March and April 1986 ) when Community stocks were exhausted and again no reasons for doing so were given . There have still been no measures to alleviate the difficult position of importers due to currency fluctuations . Whilst the sliding scale of a countervailing charge is better than a flat rate, the maximum charge leviable has been considerably increased and the whole scale is excessively high given the difficulties of compliance . The MIP itself has been significantly increased and is still too high . The implementing regulations fail to make any distinction between packed and bulk fruit and fail to give any reasons for such failure . Rebates for damaged or substandard goods are still treated as price reductions .
The Netherlands Government' s support of the Association on the second MIP system is lukewarm . It points, correctly in my view, to the different legal bases of the two systems : the first was designed to remedy serious short-term problems whereas the second is an integral part of the support mechanism . Nevertheless, doubts remain : the MIP is too high and it is not clear why the system applies to all raisins and not just sultanas . These effects are disproportionate but perhaps not so disproportionate as to invalidate the regulations .
The Commission essentially relied on its arguments in relation to the first MIP system . It contested the allegation that the MIP had been significantly increased and argued that the two-monthly fixing of coefficients made the standstill provision unnecessary .
Although the second question raises the validity of Council Regulation No 2237/85, the Association made it clear that it does not challenge its validity . Nothing has been shown in this reference to establish that it was invalid .
In respect of the second MIP system, I am not satisfied that it was necessarily ultra vires to cover all dried grapes rather than just sultanas if the import of all dried grapes can disturb the market in sultanas . This seems to me to be a matter for the trial court rather than one to be determined on a reference under Article 177 . Whether the MIP was set too high in relation to Community prices; whether the countervailing charge, even on a sliding scale, took prices well above the Community price; whether the failure to exercise the powers given to differentiate between packed and bulk goods produced results which were discriminatory or contrary to the aim of the system in respect of bulk goods, are questions of fact to be investigated, which it does not seem to me can be decided by this Court on the disputed evidence of the parties .
Accordingly, I consider that the reply to the questions put by the national court should be to the effect that Commission Regulation ( EEC ) No 2742/82 and the regulations amending that regulation are invalid in so far as they provided for a flat-rate countervailing charge, whatever the amount by which the import price fell below the MIP fixed by the Commission . It has not been shown in this case that Council Regulation ( EEC ) No 2089/85 and Commission Regulation ( EEC ) No 2237/85 ( as amended ) are themselves invalid . Whether they were applied in a way which was ultra vires or disproportionate or discriminatory as between different forms of presentation are questions of fact for the national court .
As to costs, the Association' s costs fall to be dealt with in the context of the national proceedings; the costs of the Netherlands and Greek Governments and the Commission and Council are not recoverable .
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