1 BY AN ORDER OF 2 MARCH 1981 , WHICH WAS RECEIVED AT THE COURT ON 10 APRIL 1981 , THE HIGH COURT OF JUSTICE REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER ARTICLE 177 OF THE EEC TREATY THREE QUESTIONS ON THE INTERPRETATION OF ARTICLE 5 OF COUNCIL REGULATION NO 652/79 OF 29 MARCH 1979 ON THE IMPACT OF THE EUROPEAN MONETARY SYSTEM ON THE COMMON AGRICULTURAL POLICY ( OFFICIAL JOURNAL 1979 , L 84 , P . 1 ), AS AMENDED BY COUNCIL REGULATIONS NO 1264/79 OF 25 JUNE 1979 ( OFFICIAL JOURNAL 1979 , L 161 , P . 1 ) AND NO 1011/80 OF 23 APRIL 1980 ( OFFICIAL JOURNAL 1980 , L 108 , P . 3 ), AND ALSO ON THE VALIDITY OF COMMISSION REGULATION NO 846/80 OF 2 APRIL 1980 , AMENDING REGULATION NO 2140/79 AS REGARDS THE ABOLITION OF MONETARY COMPENSATORY AMOUNTS FOR THE UNITED KINGDOM IN CERTAIN SECTORS AND THEIR INTRODUCTION IN OTHER SECTORS ( OFFICIAL JOURNAL 1980 , L 91 , P . 1 ).
2 THOSE QUESTIONS WERE RAISED IN THE COURSE OF AN ACTION BROUGHT BY STAPLE DAIRY PRODUCTS LIMITED AGAINST THE INTERVENTION BOARD FOR AGRICULTURAL PRODUCE , THE AUTHORITY RESPONSIBLE FOR , INTER ALIA , THE PAYMENT OF SUMS PROVIDED BY THE COMMUNITY FOR THE PURPOSES OF THE COMMON AGRICULTURAL POLICY . BETWEEN 1 AND 26 APRIL 1980 , THE PLAINTIFF EXPORTED MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES . THE INTERVENTION BOARD FOR AGRICULTURAL PRODUCE GRANTED IT MONETARY COMPENSATORY AMOUNTS IN RESPECT OF THOSE EXPORTS PURSUANT TO COMMISSION REGULATION NO 846/80 , WHICH FIXED THE MONETARY COMPENSATORY AMOUNTS IN RELATION TO THE EUROPEAN CURRENCY UNIT , KNOWN AS ' THE ECU ' , AND TOOK ACCOUNT OF THE FRANCHISES INTRODUCED BY COUNCIL REGULATION NO 652/79 , IN THIS CASE 1.50 POINTS .
3 THE SYSTEM OF FRANCHISES , WHICH HAS EXISTED IN VARIOUS FORMS SINCE 1974 , CONSISTS IN REDUCING BY A CERTAIN RATE THE MONETARY GAP USED FOR THE FIXING OF MONETARY COMPENSATORY AMOUNTS , IN ORDER TO AVOID OVERCOMPENSATION THROUGH THE APPLICATION THEREOF . IT WAS MAINTAINED BY COUNCIL REGULATION NO 652/79 , WHICH , FOLLOWING THE CREATION OF THE EUROPEAN MONETARY SYSTEM , SUBSTITUTED THE ECU FOR THE UNIT OF ACCOUNT FOR THE PURPOSES OF THE APPLICATION OF THE COMMON AGRICULTURAL POLICY . THE RATE OF THE FRANCHISE FIXED BY THAT REGULATION WAS AT THE MATERIAL TIME 1.50 POINTS FOR MEMBER STATES , SUCH AS THE UNITED KINGDOM , WHOSE CURRENCIES DID NOT BELONG TO THE EUROPEAN MONETARY SYSTEM .
4 REGULATION NO 652/79 , WHICH WAS ORIGINALLY TO APPLY UNTIL 30 JUNE 1979 , WAS EXTENDED UNTIL 31 MARCH 1980 , WHEN IT EXPIRED FOLLOWING THE COUNCIL ' S FAILURE TO ADOPT IN TIME THE COMMISSION ' S PROPOSALS TO CONSOLIDATE THE EXISTING AGRIMONETARY PROVISIONS OR , ALTERNATIVELY , TO EXTEND THE REGULATION ' S VALIDITY UNTIL 30 JUNE 1980 .
5 ON 2 APRIL 1980 , HOWEVER , FOLLOWING A CHANGE IN THE VALUE OF THE POUND STERLING , THE COMMISSION ADOPTED REGULATION NO 846/80 BY WHICH IT INTRODUCED , FOR MILK AND MILK PRODUCTS INTER ALIA , POSITIVE MONETARY COMPENSATORY AMOUNTS WITH REGARD TO THE UNITED KINGDOM , WHILST MAINTAINING THE METHOD OF CALCULATION IN RELATION TO THE ECU AND THE FRANCHISE OF 1.50 POINTS . THAT REGULATION , WHICH ENTERED INTO FORCE ON 7 APRIL 1980 , WAS REPLACED FOLLOWING A FURTHER CHANGE IN THE VALUE OF THE POUND STERLING , AMONGST OTHER CURRENCIES , BY COMMISSION REGULATION NO 967/80 OF 18 APRIL 1980 ALTERING THE MONETARY COMPENSATORY AMOUNTS ( OFFICIAL JOURNAL 1980 , L 103 , P . 1 ), WHICH MAINTAINED THE SAME METHOD OF CALCULATION AND THE SAME FRANCHISE , BUT ABOLISHED THE POSITIVE MONETARY COMPENSATORY AMOUNTS APPLICABLE TO THE UNITED KINGDOM IN MOST SECTORS , INCLUDING THE DAIRY SECTOR , IN VIEW OF THE FACT THAT THE AMOUNTS THUS CALCULATED WERE NEGLIGIBLE IN RELATION TO THE AVERAGE VALUE OF THE PRODUCTS IN QUESTION .
6 IN THE PREAMBLES TO REGULATIONS NO 846/80 AND NO 967/80 IT IS STATED THAT : ' ' IN ORDER TO AVOID A HIATUS IN THE SYSTEM RESULTING , IN PARTICULAR , IN AN INCREASE OR A RE-INTRODUCTION OF MONETARY COMPENSATORY AMOUNTS FOR CERTAIN MEMBER STATES , IT APPEARS NECESSARY , IN VIEW OF THE OVER-RIDING PUBLIC INTEREST AND AS A PRECAUTIONARY MEASURE PENDING A FINAL DECISION ON THE MATTER BY THE COUNCIL , TO CONTINUE TO APPLY THE SYSTEM IN ITS PRESENT FORM , TO WIT , THE CALCULATION OF MONETARY COMPENSATORY AMOUNTS IN RELATION TO THE ECU AND TAKING ACCOUNT OF THE FRANCHISES PROVIDED FOR BY REGULATION ( EEC ) NO 652/79 ' ' . ON 9 APRIL 1980 THE COMMISSION PUBLISHED A COMMUNICATION TO THIS EFFECT IN THE OFFICIAL JOURNAL ( OFFICIAL JOURNAL 1980 , C 87 , P . 12 ).
7 IT WAS NOT UNTIL 23 APRIL 1980 THAT THE COUNCIL ADOPTED REGULATION NO 1011/80 , AMENDING REGULATION NO 652/79 ON THE IMPACT OF THE EUROPEAN MONETARY SYSTEM ON THE COMMON AGRICULTURAL POLICY ( OFFICIAL JOURNAL 1980 , L 108 , P . 3 ). ARTICLE 1 OF THAT REGULATION EXTENDED REGULATION NO 652/79 , WITH EFFECT FROM 1 APRIL 1980 , UNTIL 30 JUNE 1980 , ' ' WITHOUT THE INDIVIDUAL RIGHTS ACQUIRED BY OPERATORS BEING THEREBY AFFECTED ' ' . THE REGULATION ENTERED INTO FORCE ON 26 APRIL 1980 , THE DATE OF ITS PUBLICATION IN THE OFFICIAL JOURNAL .
8 UNDER THOSE CIRCUMSTANCES , STAPLE DAIRY PRODUCTS LIMITED CONSIDERED THAT NO FRANCHISE WAS APPLICABLE TO THE MONETARY COMPENSATORY AMOUNTS PAYABLE ON EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES CARRIED OUT BETWEEN 1 AND 26 APRIL 1980 . IT THEREFORE BROUGHT AN ACTION IN THE HIGH COURT FOR A DECLARATION THAT IT WAS ENTITLED TO MONETARY COMPENSATORY AMOUNTS WITHOUT DEDUCTION OF THE FRANCHISE .
9 CONSIDERING THAT A DECISION OF THE COURT OF JUSTICE WAS NECESSARY TO ENABLE IT TO GIVE JUDGMENT , THE HIGH COURT SUBMITTED THE FOLLOWING QUESTIONS FOR A PRELIMINARY RULING :
' ' ( 1 ) HAVING REGARD TO THE DATE PRESCRIBED IN ARTICLE 5 OF COUNCIL REGULATION ( EEC ) NO 652/79 , AS AMENDED BY ARTICLE 1 OF COUNCIL REGULATION ( EEC ) NO 1264/79 , WERE THE COMPETENT AUTHORITIES IN THE UNITED KINGDOM BOUND IN RESPECT OF TRANSACTIONS UNDERTAKEN BETWEEN 1 APRIL 1980 AND 26 APRIL 1980 INCLUSIVE TO PAY MONETARY COMPENSATORY AMOUNTS ON EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES OF THE EUROPEAN COMMUNITIES , WITHOUT MAKING A DEDUCTION OF 1.50 PERCENTAGE POINTS?
( 2)IS COMMISSION REGULATION ( EEC ) NO 846/80 ADOPTED AFTER THE DATE PRESCRIBED IN ARTICLE 5 OF COUNCIL REGULATION ( EEC ) NO 652/79 , AS SO AMENDED , INVALID FOR LACK OF COMPETENCE OR FOR ANY OTHER REASON IN SO FAR AS IT PURPORTED PRIOR TO THE PUBLICATION OF COUNCIL REGULATION ( EEC ) NO 1011/80 TO REDUCE THE MONETARY COMPENSATORY AMOUNTS PAYABLE ON EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES OF THE EUROPEAN COMMUNITY BY 1.50 PERCENTAGE POINTS?
( 3)WITH REGARD TO ARTICLE 1 OF COUNCIL REGULATION ( EEC ) NO 1011/80 :
( A ) WHAT IS THE EFFECT OF THAT PROVISION WITH REGARD TO TRANSACTIONS UNDERTAKEN RELATING TO EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES IN THE PERIOD BETWEEN 1 APRIL 1980 AND 26 APRIL 1980?
( B)WHAT IS THE NATURE OF THE INDIVIDUAL RIGHTS OF OPERATORS THERE REFERRED TO , HOW AND IN WHAT CIRCUMSTANCES ARE SUCH RIGHTS ACQUIRED AND IN WHAT WAY ARE THEY NOT TO BE AFFECTED?
' '
10 IT IS CONVENIENT TO BEGIN WITH THE THIRD QUESTION , WHICH IN SUBSTANCE SEEKS TO ASCERTAIN WHETHER THE EFFECT OF ARTICLE 1 OF COUNCIL REGULATION NO 1011/80 OF 23 APRIL 1980 IS RETROACTIVELY TO CONFIRM THE APPLICATION OF MONETARY COMPENSATORY AMOUNTS BY THE COMPETENT NATIONAL AUTHORITY TO EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES BETWEEN 1 AND 25 APRIL 1980 , THE DAY BEFORE THE DATE ON WHICH REGULATION NO 1011/80 ENTERED INTO FORCE , THOSE AMOUNTS BEING GRANTED IN ACCORDANCE WITH COMMISSION REGULATION NO 846/80 , HAVING REGARD IN PARTICULAR TO THE PROVISO CONTAINED IN THAT ARTICLE CONCERNING THE INDIVIDUAL RIGHTS ACQUIRED BY OPERATORS .
11 THE PLAINTIFF IN THE MAIN PROCEEDINGS MAINTAINS THAT THAT PROVISION IS INVALID , BECAUSE IT PRODUCES AN UNLAWFUL RETROACTIVE EFFECT , IN SO FAR AS IT EXTENDS TO EXPORTS CARRIED OUT DURING THE SAID PERIOD .
12 IN THIS REGARD , THE COURT HAS ALREADY STATED IN ITS JUDGMENTS OF 25 JANUARY 1979 IN CASE 98/78 ( RACKE V HAUPTZOLLAMT MAINZ ( 1979 ) ECR 69 ) AND CASE 99/78 ( DECKER V HAUPTZOLLAMT LANDAU ( 1979 ) ECR 101 ) THAT ALTHOUGH IN GENERAL THE PRINCIPLE OF LEGAL CERTAINTY PRECLUDES A COMMUNITY MEASURE FROM TAKING EFFECT FROM A POINT IN TIME BEFORE ITS PUBLICATION , IT MAY EXCEPTIONALLY BE OTHERWISE WHERE THE PURPOSE TO BE ACHIEVED SO DEMANDS AND WHERE THE LEGITIMATE EXPECTATIONS OF THOSE CONCERNED ARE DULY RESPECTED . THOSE CONDITIONS ARE SATISFIED IN THIS CASE .
13 INDEED , WITH REGARD TO THE FIRST CONDITION , IT MAY BE SAID THAT THE AIM TO BE ACHIEVED REQUIRED THE RE-ESTABLISHMENT WITH EFFECT FROM 1 APRIL 1980 OF THE SYSTEM INSTITUTED BY REGULATION NO 652/79 . THAT BASIC REGULATION INTRODUCED A NUMBER OF MEASURES CONCERNING THE EUROPEAN MONETARY SYSTEM IN RELATION TO THE COMMON AGRICULTURAL POLICY . THOSE MEASURES FORM AN INDISSOLUBLE WHOLE , COVERING BOTH THE REPLACEMENT OF THE UNIT OF ACCOUNT BY THE ECU FOR THE PURPOSES OF THE COMMON AGRICULTURAL POLICY AND THE INTRODUCTION OF THE FRANCHISE IN ORDER TO AVOID DISTORTIONS IN PRICES AND ALSO GRADUALLY TO ABOLISH MONETARY COMPENSATORY AMOUNTS .
14 UNDER THOSE CIRCUMSTANCES , THE RE-ESTABLISHMENT OF THE SYSTEM INSTITUTED BY REGULATION NO 652/79 WITH PROSPECTIVE EFFECT , EXCLUDING THE PERIOD BETWEEN 1 AND 25 APRIL 1980 , WOULD HAVE RESULTED IN SUSPENDING FOR THAT PERIOD THE APPLICATION NOT ONLY OF THE FRANCHISE BUT ALSO OF THE ECU , WHICH WOULD HAVE MEANT RECOURSE TO THE UNIT OF ACCOUNT FOR THE CALCULATION OF THE AMOUNTS PAYABLE UNDER THE COMMON AGRICULTURAL POLICY . SINCE SUCH RECOURSE TO THE UNIT OF ACCOUNT WOULD NECESSARILY HAVE INVOLVED THE RECONVERSION OF THE AMOUNTS WHICH HAD IN THE MEANTIME BEEN FIXED IN ECU , BY APPLICATION OF THE INVERSE OF THE CONVERSION COEFFICIENT PROVIDED FOR BY REGULATION NO 652/79 , THAT IS TO SAY , WITHOUT REGARD TO THE CHANGES IN THE VALUE OF THE ECU WHICH HAD SINCE OCCURRED , THERE WOULD HAVE BEEN AN INTERRUPTION IN THE MAINTENANCE OF AGRICULTURAL PRICES , WHICH MIGHT HAVE LED TO DISTURBANCES IN THE AGRIMONETARY SYSTEM AS A WHOLE .
15 FURTHERMORE , THERE WAS IN THIS CASE PROPER RESPECT FOR THE LEGITIMATE EXPECTATIONS OF THOSE CONCERNED , AS REQUIRED BY THE SECOND OF THE TWO CONDITIONS WHICH MUST BE SATISFIED IN ORDER FOR A COMMUNITY MEASURE TO BE ABLE TO PRODUCE AN EFFECT AT A DATE PRIOR TO ITS ENTRY INTO FORCE . INDEED , THE SITUATION AT THAT TIME GAVE NO CAUSE FOR THE TRADERS CONCERNED TO EXPECT THE FRANCHISE SYSTEM TO BE ABOLISHED AFTER 31 MARCH 1980 . ON THE CONTRARY , THE HISTORY OF THE RULES IN QUESTION , AS WELL AS THEIR SCOPE AND PURPOSE , WERE SUCH AS TO LEAD TRADERS TO CONCLUDE THAT THE FRANCHISE , WHICH FOR YEARS HAD CONSTITUTED A WELL-ESTABLISHED FEATURE OF THE SYSTEM OF MONETARY COMPENSATORY AMOUNTS , WOULD BE MAINTAINED FOR SOME TIME . THE SAME CONCLUSION MAY ALSO BE INFERRED FROM THE PROPOSALS PRESENTED BY THE COMMISSION TO THE COUNCIL IN FEBRUARY AND MARCH 1980 , WHICH CLEARLY PROVIDED FOR THE MAINTENANCE OF THE SYSTEM , ALBEIT ON A SLIGHTLY AMENDED BASIS , AS WELL AS FROM COMMISSION REGULATIONS NO 846/80 OF 2 APRIL 1980 AND NO 967/80 OF 18 APRIL 1980 AND FROM THE COMMUNICATION PUBLISHED BY THE COMMISSION ON 9 APRIL 1980 .
16 IT MUST ALSO BE REMEMBERED THAT COMMISSION REGULATION NO 846/80 , AS IS CLEAR FROM ITS PREAMBLE , INTRODUCED POSITIVE MONETARY COMPENSATORY AMOUNTS IN CERTAIN SECTORS , INCLUDING THE DAIRY SECTOR . SINCE THE EFFECT OF COUNCIL REGULATION NO 1011/80 WAS RETROACTIVELY TO CONFIRM THOSE PROVISIONS , IT IS EVEN LESS CAPABLE OF INTERFERING WITH THE LEGITIMATE EXPECTATIONS OF EXPORTERS , WHO , WITHOUT THAT REGULATION , COULD NOT LEGALLY HAVE OBTAINED ANY MONETARY COMPENSATORY AMOUNT .
17 THE CONTENT AND SCOPE OF THE PROVISO INCLUDED IN ARTICLE 1 OF REGULATION NO 1011/80 CONCERNING THE INDIVIDUAL RIGHTS ACQUIRED BY OPERATORS MUST BE EXAMINED IN THE LIGHT OF THE FOREGOING CONSIDERATIONS . THE PLAINTIFF IN THE MAIN PROCEEDINGS CONTENDS THAT THAT PROVISO MUST BE UNDERSTOOD AS LAYING DOWN A GENERAL RIGHT FOR EXPORTERS TO BE TREATED SOLELY IN ACCORDANCE WITH THE LEGISLATION IN FORCE AT THE TIME WHEN THE EXPORTS WERE MADE , WHICH WOULD MEAN THAT THE FRANCHISE COULD NOT BE APPLIED TO THEIR EXPORTS MADE BETWEEN 1 AND 25 APRIL 1980 .
18 SUCH AN INTERPRETATION , WHICH WOULD AMOUNT TO THE TOTAL EXCLUSION OF THE APPLICATION OF REGULATION NO 1011/80 PRIOR TO THE DATE OF ITS ENTRY INTO FORCE , CANNOT BE ACCEPTED . IT WOULD BE CONTRARY TO THE CLEAR WORDING OF THE REGULATION AND WOULD IN ADDITION IMPAIR ITS EFFICACY BY CALLING IN QUESTION THE PROPER FUNCTIONING OF THE SYSTEM .
19 THE REFERENCE IN ARTICLE 1 OF REGULATION NO 1011/80 TO INDIVIDUAL RIGHTS ACQUIRED BY OPERATORS REFERS ONLY TO RIGHTS DEFINITIVELY CONFERRED ON THOSE OPERATORS BY INDIVIDUAL DECISIONS ADOPTED BY THE COMPETENT NATIONAL AUTHORITY BETWEEN 1 AND 25 APRIL 1980 .
20 THE ANSWER TO THE THIRD QUESTION SHOULD THEREFORE BE THAT ARTICLE 1 OF COUNCIL REGULATION NO 1011/80 OF 23 APRIL 1980 RETROACTIVELY CONFIRMED THE APPLICATION BY THE COMPETENT NATIONAL AUTHORITY OF MONETARY COMPENSATORY AMOUNTS TO EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES MADE BETWEEN 1 AND 25 APRIL 1980 , THOSE AMOUNTS BEING GRANTED IN ACCORDANCE WITH COMMISSION REGULATION NO 846/80 , THAT IS TO SAY IN RELATION TO THE ECU AND TAKING ACCOUNT OF THE FRANCHISE OF 1.50 POINTS , WITHOUT PREJUDICE , HOWEVER , TO RIGHTS DEFINITIVELY CONFERRED ON OPERATORS BY INDIVIDUAL DECISIONS ADOPTED BY THE COMPETENT NATIONAL AUTHORITY BETWEEN 1 AND 25 APRIL 1980 .
21 IN VIEW OF THE REPLY TO THE THIRD QUESTION , IT IS NO LONGER NECESSARY TO REPLY TO THE FIRST AND SECOND QUESTIONS .
COSTS
THE COSTS INCURRED BY THE UNITED KINGDOM , THE COUNCIL AND THE COMMISSION , WHICH SUBMITTED OBSERVATIONS TO THE COURT , ARE NOT RECOVERABLE . AS THESE PROCEEDINGS ARE , IN SO FAR AS THE PARTIES TO THE MAIN PROCEEDINGS ARE CONCERNED , A STEP IN THE ACTION PENDING BEFORE THE NATIONAL COURT , COSTS ARE A MATTER FOR THAT COURT .
ON THOSE GROUNDS ,
THE COURT ,
IN ANSWER TO THE QUESTIONS REFERRED TO IT BY THE HIGH COURT OF JUSTICE BY ORDER OF 2 MARCH 1981 , HEREBY RULES :
ARTICLE 1 OF COUNCIL REGULATION NO 1011/80 OF 23 APRIL 1980 RETROACTIVELY CONFIRMED THE APPLICATION BY THE COMPETENT NATIONAL AUTHORITY OF MONETARY COMPENSATORY AMOUNTS TO EXPORTS OF MILK PRODUCTS FROM THE UNITED KINGDOM TO OTHER MEMBER STATES BETWEEN 1 AND 25 APRIL 1980 , THOSE AMOUNTS BEING GRANTED IN ACCORDANCE WITH COMMISSION REGULATION NO 846/80 , THAT IS TO SAY IN RELATION TO THE ECU AND TAKING ACCOUNT OF THE FRANCHISE OF 1.50 POINTS , WITHOUT PREJUDICE , HOWEVER , TO RIGHTS DEFINITIVELY CONFERRED ON OPERATORS BY INDIVIDUAL DECISIONS ADOPTED BY THE COMPETENT NATIONAL AUTHORITY BETWEEN 1 AND 25 APRIL 1980 .
