Action brought on 21 May 2010 - Spain v Commission

(Case T-230/10)

Language of the case: Spanish

Parties

Applicant: Kingdom of Spain (represented by: M. Muñoz Pérez)

Defendant: European Commission

Form of order sought

Annul Commission Decision 2010/152/EU of 11 March 2010 excluding from European Union financing certain expenditure incurred by the Member States under the Guarantee Section of the European Agricultural Guidance and Guarantee Fund (EAGGF), under the European Agricultural Guarantee Fund (EAGF) and under the European Agricultural Fund for Rural Development (EAFRD), to the extent that it is the subject of this action for annulment, and

order the European Commission to pay the costs.

Pleas in law and main arguments

This action is brought against two of the financial corrections decided by the Commission, and is based on the infringement of the provisions of Council Regulation (EC) No 2200/96 of 28 October 1996 on the common organization of the market in fruit and vegetables,¹ Commission Regulation (EC) No 1433/2003 of 11 August 2003 laying down detailed rules for the application of Council Regulation (EC) No 2200/96 as regards operational funds, operational programmes and financial assistance,² and Commission Regulation (EC) No 1432/2003 of 11 August 2003 laying down detailed rules for the application of Council Regulation (EC) No 2200/96 regarding the conditions for recognition of producer organisations and preliminary recognition of producer groups,³ relied on by the Commission as the basis for those corrections:

As regards the exclusion of the costs of environmental management of packaging, the Commission interprets Article 15(5) of Regulation 2200/96 and Annex I of Regulation 1433/2003 as meaning that, when fixing the flat rate for aid, Member States must comply with the rule that aid is only granted in respect of expenditure borne by the producer organisations, and direct evidence is required of that fact.

The Kingdom of Spain considers that, taking into consideration the objectives and the wording of the abovementioned provisions, it cannot be necessary to require reliable proof that the costs have been borne by the producer organisations. Further, in any event, the reality is that the producer organisations do bear the costs of environmental management of packaging, given that the distributors pass the cost to them by means of paying a lower price for their products.

As regards weaknesses in the system for the control of recognition of the SAT Royal producer organisation, the Commission considers that the rule that no single member of a producer organisation may have more than 20% of the voting rights must also apply to the natural persons who are shareholders in bodies which, in turn, are members of a producer organisation. The Kingdom of Spain considers that the rule laid down in Article 14(2) of Regulation 1432/2003 applies only to those who are members of the organisation, and there is no requirement to analyse the share structure of the bodies which make up the producer organisation.

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¹ - OJ L 297, 21.11.1996, p. 1

² - OJ L 203, 12.8.2003, p. 25

³ - OJ L 203, 12.8.2003, p. 18