«(EAGGF – Clearance of accounts – 1993)»

1.. Agriculture – EAGGF – Clearance of accounts – Disallowance of expenditure arising from irregularities in the application of the Community rules – Disputed by the Member State concerned – Burden of proof – Shared by the Commission and the Member State (Council Regulation No 729/70)

2.. Agriculture – Common organisation of the markets – Oils and fats – Olive oil – Production aid – Olives used for purposes other than the production of olive oil – Excluded (Council Regulation No 2261/84)

3.. Agriculture – EAGGF – Clearance of accounts – Disallowance of expenditure arising from irregularities in the application of the Community rules – Assessment of the losses incurred by the EAGGF – Disputed by the Member State concerned – Burden of proof (Council Regulation No 729/70)

4.. Agriculture – Common organisation of the markets – Oils and fats – Olive oil – Production aid – Implementation through the intermediary of recognised producer groups – Mandatory withdrawal of recognition where there is inadequate capacity to check their member's production (Council Regulations Nos 136/66 and 2261/84)

5.. Agriculture – EAGGF – Clearance of accounts – Disallowance of expenditure arising from irregularities in the application of the Community rules – Financial correction not carried out by the Commission in a given year despite the fact that irregularities were found – No effect on the right to impose corrections in a subsequent year (Council Regulation No 729/70)

6.. Agriculture – Common organisation of the markets – Oils and fats – Olive oil – Production aid – Register of olive cultivation – Administration's own official departments – Definition (Council Regulation No 154/75, Art. 3(5))

7.. Approximation of laws – Procedures for the award of public contracts – Scope – Contracts awarded by a contracting authority to a non-independent body – Excluded

8.. Agriculture – Common organisation of the markets – Oils and fats – Olive oil – Consumption aid – Withdrawal of approval of packaging undertakings where aid improperly applied for – Compliance with the principle of proportionality (Commission Regulations Nos 2677/85, Arts 12(6), and 643/93)

9.. Agriculture – Common agricultural policy – EAGGF financing – Dried fodder – Member State's inspection systems – Setting of a minimum moisture content – Possible but not exclusive means (Council Regulations Nos 729/70, Art. 8(1), and 1117/78)

10.. Actions for annulment – Pleas in law – Lack of evidence put forward as a specific plea – Not permissible (EC Treaty, Art. 173 (now, after amendment, Art. 230 EC))

JUDGMENT OF THE COURT (Sixth Chamber) 8 May 2003 (1)

((EAGGF – Clearance of accounts – Financial year 1993))

In Case C-349/97,

applicant,

v

defendant,

APPLICATION for the annulment of Commission Decision 97/608/EC of 30 July 1997 amending Decision 97/333/EC on the clearance of the accounts presented by the Member States in respect of the expenditure for 1993 of the Guarantee Section of the European Agricultural Guidance and Guarantee Fund (EAGGF) (OJ 1997 L 245, p. 20), in so far as it relates to the Kingdom of Spain,

THE COURT (Sixth Chamber),,

composed of: J.-P. Puissochet, President of the Chamber, C. Gulmann, V. Skouris, F. Macken and N. Colneric (Rapporteur), Judges,

Advocate General: P. Léger,

having regard to the report of the Judge-Rapporteur,

after hearing the Opinion of the Advocate General at the sitting on 21 February 2002,

gives the following

1. Regulations relating to production aid for olive oil

(a)General provisions

(b)Inspection system

(c)Register of olive cultivation and computerised database on olive cultivation

2.Regulations relating to consumption aid for olive oil

3.Establishment of an inspection agency for the olive oil sector

4.Regulations relating to production aid for dried fodder

of the quantities of green, or, if appropriate, sun-dried fodder which is used; however, if the special situation of a processing plant so requires, the quantities may be estimated on the basis of areas sown,

of the quantities of dried fodder produced and the amount and quality of the dried fodder leaving the plant;

.

1.Flat-rate correction of 10% of total expenditure declared in respect of production aid for olive oil

(a)Inadequate communication between the AAO and the autonomous communities

(i)Arguments of the parties

(ii)Findings of the Court

(b)The finding that the autonomous communities do not withdraw approval from oil mills in 10% of cases proposed by the AAO and in 50% of cases as regards RPGs

(i)Arguments of the parties

(ii)Findings of the Court

(c)The absence of an operational register of olive cultivation

(i)Arguments of the parties

(ii)Findings of the Court

(d)The absence of a computerised database

(i)Arguments of the parties

(ii)Findings of the Court

(e)Checks at the oil mills

(i)Arguments of the parties

(ii)Findings of the Court

(f)Flat-rate yields assigned to producers

(i)Arguments of the parties

(ii)Findings of the Court

(g)The production of table olives

(i)Arguments of the parties

(ii)Findings of the Court

(h)No loss for the Community budget

(i)Arguments of the parties

(ii)Findings of the Court

2.The specific correction imposed on two RPGs as a result of improper financing

(a)Arguments of the parties

(b)Findings of the Court

3.The specific correction of expenditure declared in respect of the register of olive cultivation

(a)Refusal to finance profit of 10% of the total contractual amount of the work

(i)Arguments of the parties

(ii)Findings of the Court

(b)Refusal to finance overheads in excess of 2% of the total contractual amount of the work

(i)Arguments of the parties

(ii)Findings of the Court

(c)The flat-rate correction of 10% of total eligible expenditure due to the fact that the work was awarded without a tendering procedure

(i)Arguments of the parties

(ii)Findings of the Court

1.Refusal by the EAGGF to finance all or part of the aid for the consumption of olive oil granted to two packaging plants

(a)J. S. Fernandez

(i)Arguments of the parties

(ii)Findings of the Court

(b)N. R. Sevillano

(i)Arguments of the parties

(ii)Findings of the Court

2.The flat-rate correction of 2% of total expenditure declared by the Kingdom of Spain by way of consumption aid for olive oil

(a)Arguments of the parties

(b)Findings of the Court

1.Arguments of the parties

2.Findings of the Court

1.The lack of evidence

2.The audi alteram partem rule and the principle of good administration

3.The principle of nulla poena sine lege

4.The principle of proportionality

On those grounds,

THE COURT (Sixth Chamber)

hereby:

Puissochet

Gulmann

Skouris

Macken

Colneric

Delivered in open court in Luxembourg on 8 May 2003.

R. Grass

J.-P. Puissochet

Registrar

President of the Sixth Chamber