1 BY A JUDGMENT OF 30 JUNE 1986, WHICH WAS RECEIVED AT THE COURT ON 15 JANUARY 1987, THE POLIMELES PROTODIKIO ( HIGH COURT ), ATHENS, REFERRED TO THE COURT FOR A PRELIMINARY RULING UNDER ARTICLE 177 OF THE EEC TREATY TWO QUESTIONS ON THE INTERPRETATION OF COUNCIL REGULATION NO 389/82 OF 15 FEBRUARY 1982 ON PRODUCER GROUPS AND ASSOCIATIONS THEREOF IN THE COTTON SECTOR ( OFFICIAL JOURNAL 1982, L 51, P . 1 ).
2 THOSE QUESTIONS AROSE IN PROCEEDINGS BETWEEN A COTTON PRODUCERS' GROUP, OMADA PARAGOGON VAMVAKIOU ANDRIANOU-GIZINOU & CO ., THEBES, EGA ( HEREINAFTER REFERRED TO AS "THE GROUP ") AND THE HELLENIC REPUBLIC CONCERNING THE REFUSAL OF THE GREEK AUTHORITIES TO GRANT INVESTMENT AID .
3 AS APPEARS FROM THE ORDER FOR REFERENCE, THE GROUP IS RECOGNIZED BY THE GREEK AUTHORITIES UNDER ARTICLE 2 OF REGULATION NO 389/82, WHICH PROVIDES THAT THE MEMBER STATES ARE TO RECOGNIZE PRODUCER GROUPS AND ASSOCIATIONS THEREOF WHICH FULFIL CERTAIN CONDITIONS .
4 IN ACCORDANCE WITH ARTICLE 5 ( 1 ) OF THE REGULATION, ACCORDING TO WHICH THE MEMBER STATES ARE TO GRANT AID FOR CERTAIN INVESTMENTS TO PRODUCER GROUPS AND ASSOCIATIONS THEREOF, THE GROUP SUBMITTED AN INVESTMENT PROJECT WHICH WAS INCLUDED BY THE GREEK AUTHORITIES IN THE NATIONAL PROGRAMME FOR THE DEVELOPMENT AND RATIONALIZATION OF PRODUCTION, APPROVED BY THE COMMISSION . SINCE THE TOTAL AMOUNT OF THE PLANNED INVESTMENTS WAS GREATER THAN THE AMOUNT OF THE PROGRAMME, THE HELLENIC REPUBLIC GRANTED AID IN PREFERENCE TO GROUPS ORGANIZED IN THE FORM OF A COOPERATIVE .
5 THE POLIMELES PROTODIKIO, ATHENS, BEFORE WHICH THE GROUP BROUGHT AN ACTION FOR AN ORDER THAT THE HELLENIC REPUBLIC SHOULD PAY THE AID, STAYED THE PROCEEDINGS AND REFERRED THE FOLLOWING QUESTIONS TO THE COURT OF JUSTICE FOR A PRELIMINARY RULING :
"( 1 ) PURSUANT TO ARTICLES 4 AND 5 OF REGULATION ( EEC ) NO 389/82, ARE MEMBER STATES UNDER AN OBLIGATION TO GRANT AID TO RECOGNIZED PRODUCER GROUPS IN RESPECT OF INVESTMENTS MADE WITHIN THE FRAMEWORK OF THE OBJECTIVES OF THOSE PROVISIONS, IN SO FAR AS SUCH INVESTMENTS HAVE BEEN APPROVED AND INCLUDED IN THE ANNUAL ECONOMIC AID PROGRAMME OF THE MEMBER STATE?
( 2 ) ONCE AN INVESTMENT HAS BEEN APPROVED AND INCLUDED IN A MEMBER STATE' S ECONOMIC AID PROGRAMME AND HAS BEEN CARRIED OUT BY AN APPROVED PRODUCER GROUP, MAY THAT MEMBER STATE, ON THE BASIS OF THE SAME PROVISIONS IN CONJUNCTION WITH THE INTENT OF THE AFOREMENTIONED REGULATION, AFTER A SELECTION AND TO THE DETRIMENT OF A GROUP WHICH IS NOT ORGANIZED ON A COOPERATIVE BASIS, GRANT SUCH AID TO ANOTHER GROUP WHICH IS ORGANIZED ON A COOPERATIVE BASIS?"
6 REFERENCE IS MADE TO THE REPORT FOR THE HEARING FOR A MORE DETAILED STATEMENT OF THE FACTS OF THE CASE, THE COURSE OF THE PROCEDURE AND THE OBSERVATIONS SUBMITTED UNDER ARTICLE 20 OF THE PROTOCOL ON THE STATUTE OF THE COURT OF JUSTICE OF THE EEC, WHICH ARE MENTIONED OR DISCUSSED HEREINAFTER ONLY IN SO FAR IS NECESSARY FOR THE REASONING OF THE COURT .
7 IN ORDER TO REPLY TO THE FIRST QUESTION, IT IS NECESSARY TO ANALYSE ARTICLE 5 IN THE GENERAL CONTEXT OF REGULATION NO 389/82 AND THE OBJECTIVES WHICH THAT REGULATION SEEKS TO ATTAIN .
8 UNDER ARTICLES 2 AND 3 OF THE REGULATION, THE MEMBER STATES ARE TO RECOGNIZE PRODUCER GROUPS AND ASSOCIATIONS THEREOF WHICH FULFIL CERTAIN LEGAL AND ECONOMIC CONDITIONS LAID DOWN IN THE REGULATION AND ARE TO MAKE THEIR DECISIONS ON RECOGNITION KNOWN TO THE COMMISSION .
9 PURSUANT TO ARTICLES 6 TO 8, THE MEMBER STATES ARE TO DRAW UP PROGRAMMES FOR THE DEVELOPMENT AND RATIONALIZATION OF COTTON PRODUCTION AND MARKETING COVERING ALL OR PART OF THEIR TERRITORY . IT IS FOR THE COMMISSION, TO WHICH THE PROGRAMMES ARE TO BE FORWARDED, TO TAKE A DECISION AS TO THEIR APPROVAL, WHICH IS AN ESSENTIAL CONDITION FOR THE PAYMENT OF SUBSIDIES BY THE GUIDANCE SECTION OF THE EAGGF .
10 ARTICLE 5 PROVIDES THAT IN ORDER TO CONTRIBUTE TOWARDS STRUCTURAL IMPROVEMENTS AT THE LEVEL OF SUPPLY AND MARKETING AND TOWARDS THE STANDARDIZATION AND IMPROVEMENT OF QUALITY, MEMBER STATES ARE TO GRANT TO RECOGNIZED PRODUCER GROUPS AND ASSOCIATIONS THEREOF CONSTITUTED ON THE BASIS OF ARTICLE 2, AID FOR INVESTMENTS WHICH, AMONG OTHER CONDITIONS, ARE INCLUDED IN PROGRAMMES APPROVED BY THE COMMISSION .
11 IT FOLLOWS FROM AN ANALYSIS OF THOSE PROVISIONS THAT ONCE AN INVESTMENT TO BE MADE BY A PRODUCER GROUP RECOGNIZED UNDER ARTICLE 2 IS INCLUDED IN A NATIONAL PROGRAMME APPROVED BY THE COMMISSION, THE MEMBER STATE HAS NO DISCRETION TO REFUSE TO GRANT AID FOR THAT INVESTMENT .
12 THE REPLY TO THE FIRST QUESTION MUST THEREFORE BE THAT ARTICLE 5 OF REGULATION NO 389/82 MUST BE INTERPRETED AS MEANING THAT THE MEMBER STATES ARE OBLIGED TO GRANT AID TO PRODUCER GROUPS RECOGNIZED UNDER ARTICLE 2 IN RESPECT OF INVESTMENTS INCLUDED IN NATIONAL PROGRAMMES FOR THE DEVELOPMENT AND RATIONALIZATION OF PRODUCTION AND MARKETING APPROVED BY THE COMMISSION .
13 IN ORDER TO REPLY TO THE SECOND QUESTION IT MUST BE OBSERVED THAT THE REGULATION, ACCORDING TO ARTICLE 1, APPLIES TO ANY PRODUCER GROUP, THAT IS TO SAY ANY ORGANIZATION OF PRODUCERS OF COTTON, NOT CARDED OR COMBED, REGARDLESS OF ITS LEGAL FORM .
14 ARTICLE 2 PROVIDES THAT IN ORDER TO BE RECOGNIZED PRODUCER GROUPS MUST FULFIL CERTAIN LEGAL CONDITIONS, BUT IT CONTAINS NO REQUIREMENT AS TO THEIR LEGAL FORM .
15 CONSEQUENTLY, A MEMBER STATE CANNOT REFUSE TO GRANT AID TO A RECOGNIZED PRODUCER GROUP FOR INVESTMENTS INCLUDED IN A PROGRAMME APPROVED BY THE COMMISSION ON THE GROUND THAT THE GROUP IS NOT CONSTITUTED IN A PARTICULAR LEGAL FORM .
16 NOT ONLY DOES SUCH A DIFFERENCE OF TREATMENT HAVE NO BASIS IN THE REGULATION BUT, AS THE COURT HELD IN ITS JUDGMENT OF 18 DECEMBER 1986 IN CASE 312/85 VILLA BANFI V REGIONE TOSCANA AND OTHERS (( 1986 )) ECR 4039, IT WOULD CONFLICT WITH THE PROHIBITION OF DISCRIMINATION LAID DOWN IN ARTICLE 40 ( 3 ) OF THE EEC TREATY, WHICH THE MEMBER STATES MUST OBSERVE WHEN GIVING EFFECT TO THE CCOMMON AGRICULTURAL POLICY .
17 THE REPLY TO THE SECOND QUESTION MUST THEREFORE BE THAT ARTICLES 2 AND 5 OF REGULATION 389/82, READ TOGETHER, MUST BE INTERPRETED AS MEANING THAT A MEMBER STATE CANNOT REFUSE TO GRANT AID TO A RECOGNIZED GROUP FOR INVESTMENTS WHICH FORM PART OF A PROGRAMME APPROVED BY THE COMMISSION ON THE GROUND THAT THE GROUP IS NOT INCORPORATED IN A PARTICULAR LEGAL FORM .
COSTS
18 THE COSTS INCURRED BY THE COMMISSION OF THE EUROPEAN COMMUNITIES, WHICH HAS 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 PROCEEDINGS PENDING BEFORE THE NATIONAL COURT, THE DECISION AS TO COSTS IS A MATTER FOR THAT COURT .
ON THOSE GROUNDS,
THE COURT ( FIRST CHAMBER ),
IN ANSWER TO THE QUESTION REFERRED TO IT BY THE POLIMELES PROTODIKIO, ATHENS, BY A DECISION OF 30 JUNE 1986, HEREBY RULES :
( 1 ) ARTICLE 5 OF COUNCIL REGULATION NO 389/82 OF 15 FEBRUARY 1982 ON PRODUCER GROUPS AND ASSOCIATIONS THEREOF IN THE COTTON SECTOR MUST BE INTERPRETED AS MEANING THAT MEMBER STATES ARE OBLIGED TO GRANT AID TO PRODUCER GROUPS RECOGNIZED UNDER ARTICLE 2 IN RESPECT OF INVESTMENTS INCLUDED IN NATIONAL PROGRAMMES FOR THE DEVELOPMENT AND RATIONALIZATION OF PRODUCTION AND MARKETING APPROVED BY THE COMMISSION .
( 2 ) ARTICLES 2 AND 5 OF REGULATION NO 389/82, READ TOGETHER, MUST BE INTERPRETED AS MEANING THAT A MEMBER STATE CANNOT REFUSE TO GRANT AID TO A RECOGNIZED GROUP FOR INVESTMENTS WHICH FORMS PART OF A PROGRAMME APPROVED BY THE COMMISSION ON THE GROUND THAT THE GROUP IS NOT INCORPORATED IN A PARTICULAR LEGAL FORM .
