1 BY JUDGMENT DATED 28 JUNE 1974, RECEIVED AT THE REGISTRY OF THE COURT ON 5 JULY 1974, THE CONSEIL D' ETAT OF FRANCE REFERRED TO THE COURT OF JUSTICE, UNDER ARTICLE 177 OF THE TREATY, TWO QUESTIONS ON THE INTERPRETATION OF THE PROVISIONS OF THE TREATY IN THE MATTER OF NATIONAL AGRICULTURAL MARKET ORGANIZATION AND OF FREE MOVEMENT OF GOODS .
2 IT APPEARS FROM THE FILE THAT THE NATIONAL PROCEEDINGS ARE CONCERNED WITH THE LEGALITY OF QUANTITATIVE RESTRICTIONS APPLIED BY THE FRENCH REPUBLIC TO IMPORTS OF BANANAS ORIGINATING IN THIRD COUNTRIES OTHER THAN THOSE WHICH MAINTAIN SPECIAL RELATIONSHIPS WITH FRANCE .
3 THE PROVISIONS IMMEDIATELY AFFECTED BY THESE RESTRICTIONS ARE ARTICLE 5 OF THE CONVENTION BETWEEN THE COMMUNITY AND THE AFRICAN AND MALAGASY STATES ASSOCIATED WITH THE COMMUNITY, SIGNED AT YAOUNDE ON 20 JULY 1963, AS WELL AS ARTICLE 4 OF THE COUNCIL DECISION OF 25 FEBRUARY 1964 ON THE ASSOCIATION OF THE OVERSEAS COUNTRIES AND TERRITORIES WITH THE COMMUNITY .
4 THESE PROVISIONS, WHICH WERE EXPRESSED IN IDENTICAL TERMS AND WHICH AT THE TIME OF THE SUIT, REMAINED IN EXISTENCE BY VIRTUE OF A DECISION OF THE ASSOCIATION COUNCIL OF 28 MAY 1969 AND A DECISION OF THE COUNCIL OF THE EEC OF THE SAME DATE RESPECTIVELY, PROVIDE THAT AS REGARDS THE ELIMINATION OF QUANTITATIVE RESTRICTIONS, THE MEMBER STATES SHALL APPLY TO THE IMPORTATIONS IN QUESTION THE CORRESPONDING PROVISIONS OF THE TREATY .
5 THE REPLY TO THE QUESTIONS REFERRED MUST THEREFORE BE MADE IN THE LIGHT OF THESE PROVISIONS .
ON THE FIRST QUESTION
6 THE FIRST QUESTION ASKS WHETHER THE EXISTENCE IN A MEMBER STATE OF A NATIONAL MARKET ORGANIZATION WITHIN THE MEANING OF ARTICLES 43, 45 AND 46 OF THE TREATY IS SUCH AS TO PRECLUDE THE APPLICATION OF ARTICLE 33 OF THE TREATY IN THE CASE OF THE PRODUCTS CONCERNED, THAT IS TO SAY WHETHER THE NATIONAL MARKET ORGANIZATIONS FOR THE AGRICULTURAL SECTOR MAY OBSTRUCT THE RULES AS TO THE PROGRESSIVE ELIMINATION OF QUOTAS .
7 ( A ) ARTICLE 38 ( 2 ) OF TITLE II OF THE TREATY PROVIDES THAT " SAVE AS OTHERWISE PROVIDED IN ARTICLES 39 TO 46, THE RULES LAID DOWN FOR THE ESTABLISHMENT OF THE COMMON MARKET SHALL APPLY TO AGRICULTURAL PRODUCTS " .
8 IT APPEARS FROM THIS PROVISION, PARTICULARLY IF CONSIDERED IN CONJUNCTION WITH ARTICLE 42, THAT AGRICULTURAL PRODUCTS ARE, IN THE ABSENCE OF ANY CONTRARY PROVISION, SUBJECT TO THE RULES RELATING TO THE ESTABLISHMENT OF THE COMMON MARKET, WHICH INCLUDE ARTICLE 33 .
9 UNDER THE PROVISIONS OF ARTICLE 40 ( 1 ) MEMBER STATES SHALL, BY THE END OF THE TRANSITIONAL PERIOD AT THE LATEST, BRING THE COMMON AGRICULTURAL POLICY INTO FORCE .
10 UNDER THE PROVISIONS OF ARTICLES 43 AND 46 OF THE TREATY, THE NATIONAL MARKET ORGANIZATIONS MAY PROVISIONALLY BE KEPT IN EXISTENCE PENDING THE ESTABLISHMENT OF A COMMON ORGANIZATION WITHIN THE MEANING OF ARTICLE 40 ( 2 ) UNDER THE CONDITIONS DEFINED IN ARTICLE 43 ( 3 ).
11 NEVERTHELESS ARTICLE 45 OF THE TREATY PROVIDES THAT DURING THE FIRST STAGE, " TRADE SHALL BE DEVELOPED " BY THE CONCLUSION OF LONG-TERM AGREEMENTS OR CONTRACTS BETWEEN IMPORTING AND EXPORTING MEMBER STATES .
12 PARAGRAPH ( 2 ) OF THIS ARTICLE PROVIDES FOR AN " INCREASE " IN THE VOLUME OF IMPORTS BASED UPON A SPECIFIED PERIOD OF REFERENCE .
13 IT WOULD BE CONTRARY TO THE LETTER AND SPIRIT OF THESE PROVISIONS TO ADMIT THAT IN THE ABSENCE OF AGREEMENTS OR LONG-TERM CONTRACTS NATIONAL ORGANIZATIONS REMAIN PERMANENTLY EXCLUDED FROM THE RULES RELATING TO THE ELIMINATION OF QUANTITATIVE RESTRICTIONS AND MAY THEREFORE THWART THE FUNDAMENTAL PRINCIPLE OF DEVELOPMENT OF TRADE EXPRESSED BY PARAGRAPHS ( 1 ) AND ( 2 ) OF THAT ARTICLE .
14 ( B ) IT FOLLOWS FROM ARTICLE 40 ( 1 ) OF THE TREATY THAT THE COMMON ORGANIZATION OF AGRICULTURAL MARKETS SHALL DEVELOP GRADUALLY DURING THE TRANSITIONAL PERIOD AND BE ACCOMPANIED, PURSUANT TO ARTICLE 38 ( 4 ), BY THE DEVELOPMENT OF THE COMMON AGRICULTURAL MARKET IN CONFORMITY WITH THE FUNDAMENTAL OBJECTIVES OF THE TREATY, IN PARTICULAR THAT MENTIONED IN ARTICLE 3 ( D ).
15 ACCORDINGLY, WHILE THE TREATY PROVIDES THAT THE NATIONAL ORGANIZATION MAY BE KEPT IN EXISTENCE PENDING THE ESTABLISHMENT OF A COMMON ORGANIZATION, THIS WAS NEVERTHELESS ONLY ENVISAGED UNTIL THE END OF THE TRANSITIONAL PERIOD, THE DATE BY WHICH THE COMMON AGRICULTURAL POLICY MUST BE FINALLY ESTABLISHED .
16 BESIDES, THESE SAME PROVISIONS SEEM TO SHOW THAT DURING THIS PERIOD THE NATIONAL ORGANIZATION MUST ADAPT ITSELF TO THE FULLEST POSSIBLE EXTENT TO THE REQUIREMENTS OF THE COMMON MARKET WITH A VIEW TO FACILITATING THE ESTABLISHMENT OF THE COMMON AGRICULTURAL POLICY .
17 ACCORDINGLY, THE DEROGATIONS WHICH A NATIONAL ORGANIZATION MAY EFFECT FROM THE GENERAL RULES OF THE TREATY ARE ONLY PERMISSIBLE PROVISIONALLY, TO THE EXTENT NECESSARY TO ENSURE ITS FUNCTIONING, WITHOUT HOWEVER IMPEDING THE ADAPTATIONS WHICH ARE INVOLVED IN THE ESTABLISHMENT OF THE COMMON AGRICULTURAL POLICY .
18 THE FACT THAT THIS POLICY HAS NOT BEEN FINALLY ESTABLISHED WITHIN THE PERIOD FIXED BY ARTICLE 40 ( 1 ) OF THE TREATY DEMONSTRATES RATHER THAN JUSTIFIES THE ANOMALIES THAT COULD RESULT FROM KEEPING IN EXISTENCE A NATIONAL ORGANIZATION CONCEIVED BY THE TREATY AS A MEASURE HAVING A TRANSITIONAL CHARACTER .
19 IN THESE CIRCUMSTANCES, THE ADAPTATION OF A NATIONAL ORGANIZATION TO THE RULES PROVIDED FOR THE ESTABLISHMENT OF THE COMMON MARKET IS ALL THE MORE NECESSARY SINCE THE ABSENCE OF A COMMON AGRICULTURAL POLICY IS CONTRARY TO THE REQUIREMENT OF ARTICLE 3 ( D ) OF THE TREATY .
20 CONSEQUENTLY, WHILST A NATIONAL ORGANIZATION OF THE MARKET EXISTING AT THE DATE OF COMING INTO FORCE OF THE TREATY COULD, DURING THE TRANSITIONAL PERIOD, PRECLUDE THE APPLICATION OF ARTICLE 33 THEREOF, TO THE EXTENT THAT SUCH APPLICATION WOULD HAVE IMPAIRED ITS FUNCTIONING, THIS CANNOT, HOWEVER, BE THE CASE AFTER THE EXPIRATION OF THAT PERIOD, WHEN THE PROVISIONS OF ARTICLE 33 MUST BE FULLY EFFECTIVE .
ON THE SECOND QUESTION
21 THE SECOND QUESTION ASKS THE COURT TO STATE WHAT ARE THE CHARACTERISTICS OF SUCH A NATIONAL ORGANIZATION OF THE MARKET .
22 A NATIONAL MARKET ORGANIZATION WITHIN THE MEANING OF ARTICLE 43 ET SEQ . PRESUPPOSES A TOTALITY OF STRUCTURAL MEASURES THAT ALLOW IT TO ATTAIN THE OBJECTS PERMITTED BY THE TREATY .
23 UNDER THE PROVISIONS OF ARTICLES 43 ( 3 ) AND 45 ( 1 ), THE COMMON ORGANIZATION IN FACT TAKES THE PLACE OF THE NATIONAL ORGANIZATION IF IN RESPECT OF THE PRODUCT IN QUESTION IT PROVIDES EQUIVALENT SAFEGUARDS FOR THE EMPLOYMENT AND STANDARD OF LIVING OF THE PRODUCERS CONCERNED, CONTAINS ARRANGEMENTS DESIGNED TO GUARANTEE NATIONAL PRODUCERS A MARKET FOR THEIR PRODUCT AND ENSURES CONDITIONS FOR TRADE WITHIN THE COMMUNITY SIMILAR TO THOSE EXISTING IN A NATIONAL MARKET .
24 THE OBJECTIVES OF THE NATIONAL MARKET ORGANIZATION ARE THEREFORE ON A NATIONAL LEVEL ANALOGOUS TO THOSE PURSUED AT COMMUNITY LEVEL BY THE COMMON ORGANIZATION, AS THEY ARE SET OUT IN ARTICLE 39 OF THE TREATY .
25 THE PURSUIT OF SUCH OBJECTIVES MUST BE A MATTER NOT ONLY FOR TRADE ORGANIZATIONS, BUT FOR THE PUBLIC AUTHORITY BY APPROPRIATE MEASURES AND REGULATIONS, EVEN WHERE THE ADMINISTRATION THEREOF IS DELEGATED TO ORGANS UNDER PRIVATE LAW THAT ARE NEVERTHELESS PLACED UNDER THE CONTROL OF THE PUBLIC AUTHORITY .
26 THE NATIONAL ORGANIZATION THEREFORE AMOUNTS TO A TOTALITY OF LEGAL DEVICES PLACING THE REGULATION OF THE MARKET IN THE PRODUCTS IN QUESTION UNDER THE CONTROL OF THE PUBLIC AUTHORITY, WITH A VIEW TO ENSURING, BY MEANS OF AN INCREASE IN PRODUCTIVITY AND OF OPTIMUM UTILIZATION OF THE FACTORS OF PRODUCTION, IN PARTICULAR OF MANPOWER, A FAIR STANDARD OF LIVING FOR PRODUCERS, THE STABILIZATION OF MARKETS, THE ASSURANCE OF SUPPLIES AND REASONABLE PRICES TO THE CONSUMERS .
27 TO CONTINUE PERMANENTLY BEYOND THE TRANSITIONAL PERIOD A SIMPLE QUOTA SYSTEM CANNOT RESPOND TO THESE CONDITIONS .
28 THE COSTS INCURRED BY THE FRENCH GOVERNMENT AND BY THE COMMISSION OF THE EUROPEAN COMMUNITIES, WHICH HAVE SUBMITTED OBSERVATIONS TO THE COURT, ARE NOT RECOVERABLE, AND AS THESE PROCEEDINGS ARE IN SO FAR AS THE PARTIES TO THE MAIN ACTION 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 CONSEIL D' ETAT OF FRANCE BY JUDGMENT OF 28 JUNE 1974, HEREBY RULES :
1 . WHILST A NATIONAL ORGANIZATION OF THE MARKET EXISTING AT THE DATE OF COMING INTO FORCE OF THE TREATY COULD, DURING THE TRANSITIONAL PERIOD, PRECLUDE THE APPLICATION OF ARTICLE 33 THEREOF, TO THE EXTENT THAT SUCH APPLICATION WOULD HAVE IMPAIRED ITS FUNCTIONING, THIS CANNOT, HOWEVER, BE THE CASE AFTER THE EXPIRATION OF THAT PERIOD, WHEN THE PROVISIONS OF ARTICLE 33 MUST BE FULLY EFFECTIVE;
2 . THE NATIONAL ORGANIZATION CAN BE DEFINED AS A TOTALITY OF LEGAL DEVICES PLACING THE REGULATION OF THE MARKET IN THE PRODUCTS IN QUESTION UNDER THE CONTROL OF THE PUBLIC AUTHORITY, WITH A VIEW TO ENSURING, BY MEANS OF AN INCREASE IN PRODUCTIVITY AND OF OPTIMUM UTILIZATION OF THE FACTORS OF PRODUCTION, IN PARTICULAR OF MANPOWER, A FAIR STANDARD OF LIVING FOR PRODUCERS, THE STABILIZATION OF MARKETS, THE ASSURANCE OF SUPPLIES AND REASONABLE PRICES TO CONSUMERS . TO CONTINUE PERMANENTLY AND BEYOND THE TRANSITIONAL PERIOD A SIMPLE QUOTA SYSTEM CANNOT RESPOND TO THESE CONDITIONS .
