Erich Stauder v City of Ulm - Sozialamt (29/69)

B —The validity of Article 4 of the Decision of 12 February 1969

Principally, the Commission contests the claim that the decision in question makes the sale of butter at a reduced price conditional on revealing to retailers the name of the beneficiary. It claims that although such an indication is carried in the wording of the German and Dutch texts, unlike the French and Italian texts which only mention the requirement that coupons shall refer to the person concerned, the provision in the second paragraph of Article 4 can have only one meaning in all four official versions and this is proved by the fact that the decision constitutes, in substance, a uniform measure and by its purpose and origins.The version to be preferred is the French version if the origin of the decision is borne in mind. In fact the Management Committee expressly decided at its meeting of 29 January 1969 to modify, in the draft decision drawn up by the Commission, the clause to the effect that beneficiaries could only obtain butter in exchange for a coupon referring to the person concerned, ‘détaché d'une carte portant l'identité de l'acheteur’ (‘detached from a card indicating the buyer's identity’). Those last words were removed from the draft approved by the Management Committee. When the final versions of the texts were drawn up the rectification of Article 4 in the Dutch and German versions was overlooked.However, if the Commision had wished to depart from the text approved by the Management Committee it should, in accordance with Article 30(3) of EEC Regulation No 804/68, have notified the Council and this it did not do.In any event, in order to avoid all doubt the Commission has expressly amended the German and Dutch versions of Article 4, second indent, by Article 2 of its Decision of 29 July 1969 with effect from 17 February 1969 (Official Journal 1969 L 200/29).The Commission concludes that the Decision of 12 February 1969 did not at any time make the authorization to purchase butter at a reduced price dependent on presentation of a coupon mentioning the beneficiary by name. Since the objection of the Stuttgart Court was directed solely against the obligation to state the name, its question is deprived of substance.Secondarily, should the Court judge it necessary to reply to the question whether the requirement that a coupon be presented stating the name of the beneficiary is contrary to Community law, the Commission makes the following observations:1. The question put to the Court concerns the compatibility of the contested measure with the general principles of Community law in force.That is in tact the only law with which it could be concerned because Community institutions are subject only to that law and the Court of Justice can only examine regulations adopted by those institutions in the light of that law.The protection guaranteed by fundamental rights is, as regards Community law, assured by various provisions in the Treaty, such as Articles 7 and 40(3); this is written law supplemented in its turn by unwritten Community law, derived from the general principles of law in force in Member States.2. As regards the written law, the only relevant provision can be the prohibition of any kind of discrimination expressed as a general principle in Article 7 and more specifically in the second subparagraph of Article 40(3) of the EEC Treaty, according to which a common organization of agricultural markets shall exclude any discrimination between producers or consumers within the Community.But there is no question of discrimination in the present case because, although the persons entitled to purchase butter at a reduced price are not treated in the same manner as those who buy butter at the normal price, the circumstances of these two categories of persons are objectively distinguishable (cf. judgment of 17 July 1963, Government of the Italian Republic v Commission of the EEC, Case 13/63 [1963] E.C.R. 165).Moreover, Article 40(3) is not applicable during the transitional period.As far as Article 7 of the EEC Treaty is concerned it has no effect where the more specific prohibition of Article 40 applies; furthermore, it cannot apply in the absence of discrimination, and in any case this means in the absence of discrimination based on grounds of nationality.3. As regards unwritten Community law, the Commission observes that the substantive constitutionality of the obligation to reveal identity can only be placed in doubt, under German constitutional law, by the principle that the means must be proportionate to the end. This results from the principle of the State founded on the rule of law.The Court of Justice has repeatedly applied this principle in its judgments to certain aspects of the acts of Community institutions without however, holding that it applies to all the activities of the Communities or in particular to the legislative measures of the Council and of the Commission.However that may be, this rule has not been violated in this case.In fact the principal aim of selling butter at a reduced price is to reduce the stocks of butter by selling to customers whose income is not normally sufficient to enable them to purchase butter at the normal price.It is therefore in no way a public welfare measure and it was necessary to prevent the butter from being purchased by persons with higher incomes or its benefit from being converted by beneficiaries by using it to produce other goods; in both cases the economic aim of the measure — to increase consumption — would not have been achieved.The best method — which is impracticable because of the cost — would have been for the authorities in Member States to sell the butter themselves. As that was impossible, the butter had to be sold through the trade. In order to make it possible to check that supplies were being properly used at the time of sale, it was considered necessary to mark each coupon (for instance by numbering) so as to make it possible to discover to whom the butter had been delivered.It is easier to identify the beneficiary if his name is on the coupon. The removal of anonymity from the coupon also constitutes a psychological deterrent against abuse. The means used was therefore proportionate to the ends pursued.Furthermore, there is no question of there having been a breach of the principle of proportionality because the Decision of 12 February 1969 does not necessarily entail any legal disadvantage for the person concerned. The reduced price is a concession which the beneficiary can refuse to take up. There is therefore no real encroachment on his rights in the classical sense of the word.Lastly, regard for the principle of proportionality need not entail substitution of a judicial assessment for the discretion allowed to the institution having the power to issue the contested measure. One can only consider that the principle has been violated if the means decided upon as suitable for achievement of the end in view can in no way be justified, whatever the objective criteria used in assessing it, and that is not so in the present case.Accordingly the Commission proposes in the first place a reply in the following terms:— Examination of the question referred to the Court by the Verwaltungsgericht Stuttgart has revealed no ground for holding that the Decision of the Commission of 12 February 1969 is void to the extent to which it makes ‘purchase of butter at a reduced price dependent on the presentation of a coupon referring to the person concerned.’Alternatively, it proposes that the question should be answered in the negative.