Opinion of the Advocate-General
1 The Bundesverwaltungsgericht has referred to the Court the same questions in every respect, arising out of the same dispute, as those which gave rise to the Court's judgment of 22 June 1994 in Deutsches Milch-Kontor (1) (hereinafter `the judgment' or `the judgment of 22 June 1994').
Those questions are concerned with the interpretation of various Community regulations governing the conditions for granting Community aid for skimmed-milk powder produced in a Member State and intended for processing in another Member State.
2 The national court considers that the answers given in the judgment of 22 June 1994 relate to a factual situation different from that set out in its request and that therefore they are not such as to dissipate the doubts which it entertains regarding the interpretation of Community law which it sought.
3 Without repeating in detail the context of the case - I would refer, so far as may be necessary, to the judgment of 22 June 1994 and to the Opinion of Advocate General Darmon in the case -, I would merely remind the Court that the case raises essentially two problems. The questions put to the Court concern, on the one hand, the frequency and type of inspections which may be carried out under the relevant Community rules and, on the other hand, on the compatibility with Community law of charging to traders the costs of the analyses carried out on the occasion of systematic inspections of milk intended to be exported for the purposes of processing.
4 By way of reminder, I would mention that the applicable Community legislation was introduced in order to support the disposal on the market of the products falling within its scope, through their use in animal feed. Under the system established the aid is in principle to be granted in the Member State in which the processing took place. (2) However, it is also open to the Member States to derogate from that system by authorizing payment of the aid by the State in which the product is manufactured and not by the State in which it is processed. The Member States have had recourse to this option only as regards the export of skimmed-milk powder to Italy. As regards products intended for that country, it therefore falls to the exporting Member State to pay the aid for skimmed-milk powder produced in its territory but intended for denaturing or processing in Italy. (3) The payment of the aid is made subject to certain conditions. (4)
5 Deutsches Milch-Kontor (hereinafter `DMK') exports skimmed-milk powder from Germany to Italy, where it is intended for processing into compound feedingstuffs for animals. Transport is effected in lorries, each one conveying a batch of around 25 tonnes.
6 In order to determine whether the milk could qualify for aid, the Bundesamt für Ernährung und Forstwirtschaft (Federal Office for Food and Forestry) (hereinafter `the BEF') arranged for inspections to be carried out by the competent customs dispatch office. Those inspections were carried out systematically, and consisted in taking samples from each lorry-load, which were subsequently analysed. The cost of analysis relating to those inspections were charged to DMK by the BEF.
7 In its order for reference in this case (5) the Bundesverwaltungsgericht states that that office is situated in Hamburg and that the inspections are carried out as part of cross-border operations, but within the country, a long way from the frontier (German-Austrian or German-Swiss) which is to be crossed.
8 Since the parties were in disagreement on the question whether DMK could require from the BEF reimbursement of those costs, the national court referred to this Court, in Case C-426/92, the following questions:
`1. Is the first subparagraph of Article 2(4) of Regulation (EEC) No 1624/76 of 2 July 1976, as amended by Article 1 of Regulation (EEC) No 1726/79 of 26 July 1979, to be interpreted as meaning that, where skimmed-milk powder produced in Germany is exported by lorry to Italy for use in the manufacture of compound feedingstuffs, the competent authority is required to take a sample from each lorry-load and have it analysed in order to be able to issue the certificate referred to in that provision?
2. If Question 1 is answered in the negative, what criteria are to be elicited from Article 2(1)(a) of Regulation (EEC) No 1624/76, as amended by Article 1 of Regulation (EEC) No 1726/79, in conjunction with Article 10 of Regulation (EEC) No 1725/79 for the purpose of determining the frequency with which samples must and may be taken in the case of skimmed-milk powder exported by lorry to Italy?
3. Is it compatible with the prohibition of charges having an effect equivalent to customs duties (Articles 9, 12 and 16 of the EEC Treaty), the prohibition of discrimination (Article 95 of the EEC Treaty) and other provisions of Community law to make the exporter bear the full costs under national law of systematic or occasional inspections?'
9 In its judgment of 22 June 1994 this Court ruled as follows:
`1. Article 2(1) and (4) of Commission Regulation (EEC) No 1624/76 of 2 July 1976 concerning special arrangements for the payment of aid for skimmed-milk powder denatured or processed into compound feedingstuffs in the territory of another Member State, as amended by Article 1 of Commission Regulation (EEC) No 1726/79 of 26 July 1979, and Article 10 of Commission Regulation (EEC) No 1725/79 of 26 July 1979 on the rules for granting aid to skimmed milk processed into compound feedingstuffs and skimmed-milk powder intended for feed for calves, in conjunction with Article 34 of the EEC Treaty, must be interpreted as not permitting systematic inspections to be carried out at the frontier with a view to verifying compliance with the conditions as to the composition and quality of skimmed-milk powder intended for processing into compound feeding-stuffs in another Member State, on which entitlement to export refunds depends. However, those provisions do not preclude frontier inspections, provided that they are carried out only by means of spot checks.
2. A charge levied in respect of the systematic frontier inspections referred to above constitutes a charge having an effect equivalent to a customs duty on exports which is prohibited under Articles 9 and 12 of the Treaty, even if it corresponds to the actual cost of each inspection.'
10 Notwithstanding that judgment, the Bundesverwaltungsgericht has referred the same questions to the Court, justifying their repetition as follows.
11 It points out that mention is expressly made, not only in the operative part but also in the grounds of the Court's judgment, of systematic `inspections at the frontier'. It considers that, in so doing, this Court based itself on facts which depart from those which had been set out in the order for reference and that, for this reason, the case is still not ready for hearing and determination. According to the Bundesverwaltungsgericht, the language used in the judgment of 22 June 1994 suggests that this Court had in mind `... inspections which take place close to the frontier and not to inspections within a State on the occasion of a proposed frontier crossing', these inspections being `exclusively inspections carried out immediately next to the frontier when it is being crossed'. (6)
12 However, in the present case the Bundesverwaltungsgericht makes it clear that the inspections at issue `... at the competent dispatch customs office in Hamburg, and thus in respect of a cross-frontier transaction, but within the country, at a great distance from the frontier to be crossed'. (7)
13 Thus the sole object of the present reference for a preliminary ruling is ultimately to obtain clarification from this Court on the point whether the judgment of 22 June 1994 applies to the factual situation as specified, without there being any need to review the solution adopted. In other words, the Court is solely being asked whether the questions put to it must receive the same answer where the inspections are carried out in the context of a cross-frontier transaction, but within the State, at a great distance from the frontier to be crossed, as where the inspections are carried out when the frontier is crossed.
14 In my opinion this question, as reformulated, must be answered in the affirmative.
15 Let us look in turn at each of the two questions formulated by the national court and let us set the answers which the Court has given to them against the facts as clarified today.
16 In replying to the first two questions, the Court considered that, since inspections which are carried out systematically through taking samples in the Member State of dispatch, and which are intended to check the composition and quality of the milk from the point of view of receipt of aid, are neither prescribed by the relevant Community rules nor justified by one of the requirements recognized by Article 36 of the Treaty, they constitute measures having an effect equivalent to quantitative restrictions on exports in trade between Member States, prohibited by Article 34 of the Treaty.
17 The fact that the Court referred to inspections at the frontier does not appear to me to be in any way a deciding factor in the reasoning which it followed.
18 A reading of the judgment shows that the place where those inspections are carried out is of little consequence. It was the frequency and the nature of the inspections prescribed in this case by national law - that is to say, systematic inspections carried out by the taking of samples - which the Court held to be contrary to Community law.
Thus, the Court made it clear that inspections at the frontier having the same purpose would be permissible if their nature and frequency were different:
`... they [the Member States] cannot be prevented from maintaining frontier inspections in respect of consignments intended for export, provided that such inspections take place on a random basis'; (8) `... Those provisions [the Community provisions at issue] do not preclude frontier inspections, provided that they are carried out only by means of spot checks'. (9)
19 The grounds stated in the Court's judgment moreover remain valid irrespective of the place where the inspections at issue take place.
20 Referring to its earlier case-law, (10) the Court first pointed out that:
`... in intra-Community trade, any systematic inspection at a frontier constitutes an obstacle which may be in breach of Articles 30 and 34 of the Treaty'. (11)
In order to fall under the prohibition laid down in those provisions, it is sufficient that the measures at issue be liable to impede, directly or indirectly, actually or potentially, imports or exports between Member States. Measures of that kind include all inspections which, as a result of the delays inherent in them and of the additional transport costs which the trader may incur thereby, are `... likely to make imports or exports more difficult or more costly'. (12)
Whether these inspections are in practice carried out when the goods actually cross the frontier with a view to exportation or prior to this, but still with the object of crossing the frontier, makes no difference to the fact that, owing to their systematic nature and the manner in which they are carried out, they are `likely to make trade more difficult or more costly' and thus infringe Article 34 of the Treaty.
21 Once it is accepted that inspections such as those described by the national court constitute quantitative restrictions on exports, prohibited by Community law, irrespective of the place where they are carried out, it is necessary to examine the question whether taking that place into consideration can cast doubt on the finding at which the Court arrives on the basis of the absence of any justification for such inspections under Article 36 of the Treaty.
22 Three grounds of justification have been put forward.
23 As regards the first two, one involving arguments of an economic and practical nature, the other based on an analysis of the inspections as constituting a counterpart of the advantages deriving from voluntary acceptance of a system of export refunds, the taking into account of the place of inspection cannot in my view call in question the rejection of these arguments on the grounds which were set out by the Court. As the Court pointed out, with regard to the practical and financial reasons invoked, `... it need only be pointed out that Article 36 of the Treaty cannot be relied on to justify rules or practices which, even though they are beneficial, contain restrictions which are explained primarily by the concern to lighten the administration's burden or reduce public expenditure ...', (13) and, with regard to the second argument, `... suffice it to point out that systematic inspections not provided for under the relevant Community rules cannot constitute a counterpart of that kind'. (14)
24 In Case C-426/92 the Commission attempted to justify the inspections at issue by a third argument - also put forward at the hearing in the present case by the representative of the BEF - namely that `... frontier inspections are the only way to prevent fraud during the journey between the factory where the goods are produced and the processing undertaking'. (15) Nor, in rejecting that view on the ground, in conformity with its case-law, (16) that `... systematic frontier inspections are not compatible with the provisions governing the free movement of goods ...', (17) did the Court have recourse to a criterion based on the place of those inspections. The Court pointed out that:
`... even if the frontier inspections in question are likely to prevent fraud during transportation within Germany, they provide no guarantee that the goods will still satisfy the minimum conditions as to composition and quality required by the Community rules when they reach the processing undertaking. Fraud cannot be ruled out during transport within the territory of transit States or within that of the State of destination itself.' (18)
Nor, similarly, do inspections carried out on account of the crossing of the frontier, but within the territory of the State of dispatch, provide any guarantee that no fraud will be committed during the remainder of the journey.
25 The answers which you gave to the first two questions therefore remain valid in circumstances where the inspections did not take place when the frontier was crossed but did so at the competent customs dispatch office in Hamburg.
26 By its last question the Bundesverwaltungsgericht wishes to ascertain whether all the costs occasioned by the inspections at issue can be charged to the exporter.
27 On this point, too, I think I must adhere to the answer which the Court gave in the first preliminary ruling proceedings. Once again, the place of the inspections cannot alter the fact that a charge levied in respect of the systematic inspections at issue `... constitutes a charge having an effect equivalent to a customs duty on exports which is prohibited under Articles 9 and 12 of the Treaty, even if it corresponds to the actual cost of each inspection'. (19)
28 The `frontier inspections' referred to in the judgment of the Court are in my view to be understood without any reference to the place in which they are carried out. It is of no account whether they are carried out close to the actual frontier between two States or within one of those States, provided that a crossing of the frontier is intended.
29 The deciding factor is not the place where these inspections are carried out but the reason for which they are carried out, that is to say because the transported goods are intended to cross the frontier. It makes no difference whether the samples are taken directly at the frontier, when it is crossed, or at the competent customs dispatch office.
30 The decisive factors are the nature and frequency of the inspections carried out. In the context of the rules at issue, systematic inspections carried out by the taking of samples are, according to the judgment of 22 June 1994, not permissible.
31 I therefore propose that the questions put by the Bundesverwaltungsgericht, as reformulated, be answered as follows:
The judgment of the Court delivered on 22 June 1994 in Deutsches Milch-Kontor (Case C-426/92) falls to be applied irrespective of the place where the inspections at issue are carried out, and does so in particular where they are carried out within the country, at a great distance from the frontier which is to be crossed, provided that it is actually intended that there will be such a crossing.
(1) - Case C-426/92, ECR I-2757.
(2) - Regulation (EEC) No 986/68 of the Council of 15 July 1968 laying down general rules for granting aid for skimmed milk and skimmed-milk powder for use as feed (OJ, English Special Edition 1968 (I), p. 176).
(3) - Commission Regulation (EEC) No 1624/76 of 2 July 1976 concerning special arrangements for the payment of aid for skimmed-milk powder denatured and processed into compound feedingstuffs in the territory of another Member State (OJ 1976 L 180, p. 9).
(4) - Laid down by Commission Regulation (EEC) No 1726/79 of 26 July 1979 amending Regulation (EEC) No 1624/76, Regulation (EEC) No 368/77, Regulation (EEC) No 443/77 and Regulation (EEC) No 1844/77 on aid measures and special sales operations for skimmed-milk powder for use in feed and by Commission Regulation (EEC) No 1725/79 of 26 July 1979 on the rules for granting aid to skimmed milk processed into compound feedingstuffs and skimmed-milk powder intended for feed for calves (OJ 1979 L 199, p. 1).
(5) - Page 6, second paragraph of the French translation of the order for reference.
(6) - Order for reference, p. 5 of the French translation.
(7) - Ibid., p. 6, second paragraph, sixth line.
(8) - Paragraph 44, my emphasis.
(9) - Paragraph 45, my emphasis.
(10) - Judgments in Case 35/76 Simmenthal [1976] ECR 1871, point 14, and in Case 190/87 Moorman [1988] ECR 4689, point 8, cited in paragraphs 20 and 21 of the judgment.
(11) - Paragraph 22.
(12) - Paragraph 20.
(13) - Paragraph 39.
(14) - Paragraph 40.
(15) - Paragraph 37, my emphasis.
(16) - Judgment in Case 39/70 Fleischkontor [1971] ECR 49, point 5.
(17) - Paragraph 42.
(18) - Paragraph 43.
(19) - Paragraph 56.
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