Court of Justice of the European Communities (including Court of First Instance Decisions)

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1 . Acts of the institutions - Regulations - Basic regulation requiring implementing measures - Implementing regulation not adopted - Application of the implementing regulation of a previous basic regulation, since repealed - Conditions
( Council Regulations Nos 817/70, Art . 5(2 ), 338/79, Art . 6(2 ) and 823/87, Art . 6(2 ); Regulation No 1698/70 of the Commission )
2 . Agriculture - Common organization of the markets - Wine - Quality wines produced in specified regions - Production rules - Derogations - Processing of grapes and grape musts outside the region in which they were harvested - Derogation conditional upon authorization granted by national authorities in compliance with Community rules
( Council Regulations Nos 338/79, Art . 6(2 ) and 823/87, Art . 6(2 ); Regulation No 1698/70 of the Commission )

1 . In a situation where a provision of a basic regulation cannot be applied unless implementing measures are adopted and where such measures have not been adopted, the provisions of a previous regulation which were adopted, for the implementation of an identical provision in a previous basic regulation since repealed, in accordance with a procedure identical to that laid down in the basic regulation may be deemed to stand in their stead until such time as such measures are adopted, provided that the provisions concerned are in no way inconsistent with subsequent Community legislation in the relevant field .
Regulation No 1698/70 of the Commission, which was adopted on the basis of Article 5(2 ) of Council Regulation No 817/70, must be regarded as the enactment embodying the detailed rules for the application of Article 6(2 ) of Council Regulation No 823/87 until such time as an new enactment is adopted or, as the case may be, of Article 6(2 ) of its predecessor, Council Regulation No 338/79 .
2 . Regulation No 823/87 laying down special provisions relating to quality wines produced in specified regions, and its predecessor, Regulation No 338/79, must be interpreted as requiring all operations concerning, or storage of, products in the course of vinification which have not yet become quality wine psr or quality sparkling wine psr to be carried out within the specified region of production and the Member States may derogate from that rule only subject to the limits and conditions laid down in Article 6(2 ) of the abovementioned regulations and in Regulation No 1698/70 on certain derogations concerning the production of quality wines produced in specified regions .

In Case C-315/88
REFERENCE to the Court under Article 177 of the EEC Treaty by the pretura di Frascati ( Magistrates' Court, Frascati ), Italy, for a preliminary ruling in the criminal proceedings pending before that court against
Angelo Bagli Pennacchiotti, President of the Monte Porzio Wine-Growers' Cooperative,
on the interpretation of certain provisions of the Community rules concerning the place where vinification is to be carried out in the production of quality wines produced in specified regions ( quality wines psr ) and quality sparkling wines produced in specified regions ( quality sparkling wines psr ), in particular Council Regulation ( EEC ) No 822/87 of 16 March 1987 on the common organization of the market in wine ( Official Journal 1987, L 84, p . 1 ),
THE COURT ( Third Chamber )
composed of : M . Zuleeg, President of Chamber, J . C . Moitinho de Almeida and F . Grévisse, Judges
Advocate General : J . Mischo
Registrar : D . Louterman, Principal Administrator
after considering the written observations and written answers to the questions put by the Court submitted on behalf of
Angelo Bagli Pennacchiotti, by Enrico Esposito, of the Rome Bar;
the Italian Government, by Ivo Maria Braguglia, avvocato dello Stato;
the Spanish Government, by Javier Conde de Saro, Director-General for Community Legal and Institutional Coordination, and Rafael García Valdecasas, abogado del Estado, Head of the Legal Department for Matters before the Court of Justice of the European Communities, acting as Agents;
the Commission of the European Communities, by Alberto Prozzillo, Eugenio De March and Klaus-Dieter Borchardt, Legal Advisers, acting as Agents;
having regard to the Report for the Hearing,
after hearing the oral observations of the Italian Government, the Spanish Government, represented by Rosario Silva de Lapuerta, abogado del Estado, acting as Agent, and the Commission of the European Communities, represented by E . De March, assisted by R . Riebe, expert, at the hearing on 7 February 1990,
after hearing the Opinion of the Advocate General delivered at the same hearing,
gives the following
Judgment

1 By order dated 21 September 1988, which was received at the Court on 27 October 1988, the pretura di Frascati referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty a question on the interpretation of the provisions of Community law concerning quality wines produced in specified regions and on the circumstances in which Member States may authorize the movement of such wines outside the region of production during the course of their preparation .
2 That question arose in the context of criminal proceedings against A . Bagli Pennacchiotti, the President of a wine-growers' cooperative at Monte Porzio, Latium, Italy .
3 The undertaking headed by him is alleged to have vinified 1 495 hectolitres of Frascati wine on premises situated outside the specified region of production for that wine . On account of that vinification, which was carried out in 1987, A . Bagli Pennacchiotti has been charged under Article 515 of the Penal Code, which concerns commercial fraud, and Article 28 of Decree No 930 of the President of the Republic of 12 July 1963, which lays down penalties for "the production, sale, offering for sale or distribution in any manner for consumption under a registered or registered and certified designation of origin wines which do not fulfil the conditions laid down for the use of such a designation ...".
4 The accused claimed, before the national court, that the Italian rules contained inconsistent provisions concerning the circumstances in which wines could be moved outside their specified region of production during the course of their preparation, and requested that a ruling should be sought from the Court of Justice of the European Communities on whether Council Regulation ( EEC ) No 822/87 of 16 March 1987 on the common organization of the market in wine ( Official Journal 1987, L 84, p . 1 ) authorizes Member States to enact national rules allowing such movement .
5 The national court therefore decided to stay the proceedings until the Court of Justice had given a preliminary ruling on the following question :
"Do the powers conferred on the Member States by Regulation ( EEC ) No 822/87 concerning movements and territorial limits in regard to vinification entail a mere prohibition, or do they enable Member States to adopt measures laying down different rules?"
6 Reference is made to the Report for the Hearing for a fuller account of the facts of the case in the main proceedings, the applicable Community legislation and the written observations submitted to the Court, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court .
7 The national court' s question seeks, essentially, to determine whether the Community rules applicable to quality wines produced in specified regions categorically prohibit any movement of products in the course of vinification outside the territorial limits of the specified regions of production of the wine or whether, on the contrary, those rules authorize Member States to enact national rules allowing such movement in certain circumstances .
8 As the Commission has pointed out in its written observations to the Court, Frascati wine is classified as a quality wine produced in a specified region ( hereinafter referred to as a "quality wine psr ") or a quality sparkling wine produced in a specified region ( hereinafter referred to as a "quality sparkling wine psr "). Since there is nothing in the documents before the Court from which it may unequivocally be concluded that the scope of the national court' s question is confined to only one of those two categories of wine, the Court must, in order to rule on that question, interpret the provisions of Community law applicable to both quality wines psr and quality sparkling wines psr .
9 Council Regulation ( EEC ) No 822/87, to which the national court' s question explicitly refers, does not itself contain any provision concerning the place where the vinification process is to be carried out . Contrary to what the defendant in the main proceedings claims, the provisions of Article 15 of that regulation and Annex VI thereto concern solely the definition of authorized oenological practices and processes, and cannot be interpreted as authorizing any movement of the products in the course of vinification outside the limits of the specified region of production .
10 However, in order to provide a satisfactory answer to a national court which has referred a question to it, the Court of Justice may deem it necessary to consider provisions of Community law to which the national court has not referred in its question ( judgment of 20 March 1986 in Case 35/85 Procureur de la République v Tissier (( 1986 )) ECR 1207 ). It is for the national court, however, to decide whether or not the rule of Community law, as interpreted by the Court of Justice pursuant to Article 177, is applicable in the case brought before it .
11 The Commission and the Italian and Spanish Governments are right to maintain, in that regard, that the regulation to be considered in order to provide a satisfactory answer to the national court' s question is Council Regulation ( EEC ) No 823/87 of 16 March 1987 laying down special provisions relating to quality wines produced in specified regions ( Official Journal 1987, L 84, p . 59 ), which include quality sparkling wines psr . On 1 April 1987, that regulation replaced Council Regulation ( EEC ) No 338/79 of 5 February 1979 ( Official Journal 1979, L 54, p . 48 ), the relevant provisions of which were, as far as the national court' s question is concerned, identical .
12 Regulation No 823/87 was subsequently amended by Council Regulation ( EEC ) No 2043/89 of 19 June 1989 ( Official Journal 1989, L 202, p . 1 ). The provisions relating to the place where the process of vinification of quality sparkling wines psr is to be carried out are contained, since its amendment by Council Regulation ( EEC ) No 2044/89 of 19 June 1989 ( Official Journal 1989, L 202, p . 8 ), in Council Regulation ( EEC ) No 358/79 of 5 February 1979 on sparkling wines produced in the Community ( Official Journal 1979, L 54, p . 130 ). Since those amendments did not come into effect until 1 September 1989, after the date of the national court' s order and therefore after the date of the events in respect of which criminal proceedings have been brought in Italy against A . Bagli Pennacchiotti, they are not to be taken into account when answering the question referred to the Court .
13 Under Article 3(1 ) of Regulation No 823/87, and of its predecessor, Regulation No 338/79, a quality wine psr or a quality sparkling wine psr is produced in a wine-growing area or combination of wine-growing areas referred to as a "specified region ".
14 Paragraph 2 of that article, in both regulations, provides :
"Each specified region shall be precisely demarcated, as far as possible on the basis of the individual vineyard or vineyard plot . Such demarcation shall be effected by each Member State concerned and shall take into account the factors which contribute towards the quality of the wines produced in those regions, such as the nature of the soil and subsoil, the climate and the situation of the individual vineyard or vineyard plot ."
15 As regards the relationship of the place where the vinification process is to be carried out to the "specified regions" of production, Article 6(2 ) of both Regulation No 823/87 and its predecessor, Regulation No 338/79, laid down the rule that the processing of grapes into must and of must into wine may, in principle, be carried out only within the limits of the specified region . It is clear from the preamble to Regulation No 823/87 that the rule was enacted in order to preserve the specific character bestowed by its origin on each wine and to simplify the work of the inspection agencies .
16 However, the same provisions allow vinification operations to take place outside the specified region, in derogation from the rule previously laid down, where :
"( a ) the rules of the Member State in whose territory the grapes were harvested permit,
and
( b ) production is supervised ."
17 In accordance with Article 6(3 ) of both Regulation No 823/87 and its predecessor, Regulation No 338/79, the circumstances in which the Member States may authorize derogations on that basis are to be laid down by the Commission or, in certain cases, the Council in accordance with the "management committee" procedure defined, for the purposes of each of those regulations, by Article 83 of Regulation No 822/87 and Article 67 of Council Regulation ( EEC ) No 337/79 of 5 February 1979 on the common organization of the market in wine ( Official Journal 1979, L 54, p . 1 ).
18 No implementing regulation has been adopted on the basis of those provisions . The circumstances in which Member States may derogate from the rule that the vinification process must take place within the specified regions are, however, specified in Regulation ( EEC ) No 1698/70 of the Commission of 25 August 1970 on certain derogations concerning the production of quality wines produced in specified regions ( Official Journal, English Special Edition 1970 ( II ), p . 579 ).
19 Regulation No 1698/70 was adopted on the basis of Article 5(2 ) of Regulation ( EEC ) No 817/70 of the Council of 28 April 1970 laying down special provisions relating to quality wines produced in specified regions ( Official Journal, English Special Edition 1970 ( I ), p . 252 ), repealed by Regulation No 338/79 .
20 The provisions of Article 5(2 ) of Regulation No 817/70 are identical in substance to those of Article 6(2 ) of both Regulation No 823/87 and 338/79 . Regulation No 1698/70 was drawn up in accordance with a procedure identical to that provided for in those regulations . Finally, there is no discernible contradiction between the relevant provisions of Regulation No 1698/70 and subsequent provisions of Community law .
21 In those circumstances, Regulation No 1698/70 must be deemed to apply and must be regarded as the enactment embodying the detailed rules for the application of Article 6(2 ) of Regulation No 823/87 until such time as a new enactment is adopted or, as the case may be, of Article 6(2 ) of its predecessor, Regulation No 338/79 .
22 It must be pointed out that Regulation No 1698/70 was enacted at a time when quality sparkling wines psr did not constitute a category of wines separate from that of quality wines psr . It must therefore be accepted that it applies without distinction to both quality wines psr and quality sparkling wines psr .
23 It is clear from the provisions of Regulation No 1698/70 that the derogations which Member States may grant are subject to very strict conditions . First, the vinification process may be carried out outside the limits of the specified region only if that is expressly authorized by the competent authority of the producer Member State and only in an establishment situated in the immediate proximity of the specified region; secondly, the grapes and grape musts intended for the preparation of quality wines psr and quality sparkling wines psr must be held separately from other grapes and grape musts and must be easily identifiable . Furthermore, natural or legal persons who produce grapes or grape musts, and those who turn them into wine, must keep precise records of the movements of the products . Finally, the Member State concerned must ensure control of those operations .
24 Member States may not, therefore, derogate from the rule laid down by Article 6(2 ) of both Regulation No 823/87 and its predecessor, Regulation No 338/79, unless the derogating rules which they enact comply with the requirements of Regulation No 1698/70 .
25 Before the Court, A . Bagli Pennacchiotti drew a distinction between the vinification process and mere storage and it must therefore be pointed out that the provisions of Article 6 of both Regulation No 823/87 and Regulation No 338/79 and those of Regulation No 1698/70 would be rendered nugatory if they were interpreted as not applying to the storage of products in the course of vinification . If there were freedom to store the products outside the limits of the specified region, as such an interpretation would imply, it would no longer be possible to check the authenticity of the wines in question, a result contrary to the aim pursued . Such an interpretation would, moreover, disregard the provisions of Article 3 of Regulation No 1698/70, which govern the conditions for storage outside the limits of the specified regions of production .
26 The abovementioned provisions must therefore be interpreted as applying to all operations, including storage, involving products in the course of vinification which have not yet become quality wine psr or quality sparkling wine psr .
27 The answer to the national court' s question must therefore be that Council Regulation No 823/87 of 16 March 1987 laying down special provisions relating to quality wines produced in specified regions, and its predecessor, Council Regulation No 338/79 of 5 February 1979, must be interpreted as requiring all operations concerning, or storage of, products in the course of vinification which have not yet become quality wine psr or quality sparkling wine psr to be carried out within the specified region of production and the Member States may derogate from that rule only subject to the limits and conditions laid down in Article 6(2 ) of the abovementioned regulations and in Commission Regulation ( EEC ) No 1698/70 of 25 August 1970 on certain derogations concerning the production of quality wines produced in specified regions .

Costs
28 The costs incurred by the Italian Government, the Spanish Government and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable . Since these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the proceedings pending before the national court, the decision on costs is a matter for that court .

On those grounds,
THE COURT ( Third Chamber ),
in answer to the question referred to it by the pretura di Frascati, by order of 21 September 1988, hereby rules :
Council Regulation ( EEC ) No 823/87 of 16 March 1987 laying down special provisions relating to quality wines produced in specified regions, and its predecessor, Council Regulation ( EEC ) No 338/79 of 5 February 1979, must be interpreted as requiring all operations concerning, or storage of, products in the course of vinification which have not yet become quality wine psr or quality sparkling wine psr to be carried out within the specified region of production and the Member States may derogate from that rule only subject to the limits and conditions laid down in Article 6(2 ) of the abovementioned regulations and in Commission Regulation ( EEC ) No 1698/70 of 25 August 1970 on certain derogations concerning the production of quality wines produced in specified regions .