Carlo Tedeschi v. Denkavit Commerciale S.R.L. (Case 5/77) Before the Court of Justice of the European Communities ECJ (The President, Kutscher C.J.; Donner and Pescatore PP.C.; Mertens de Wilmars, Sorensen, Lord Mackenzie Stuart, O'Keeffe, Bosco and Touffait JJ.) M. Henri Mayras, Advocate General. 5 October 1977 Reference by the Pretura di Lodi under Article 177. European Court procedure. Reference under Article 177. National court. The European Court will not enquire into the reasons or the relevance of a reference made to it under Article 177 EEC by a national court in relation to the proceedings before the referring court.[17]-[19] Food. Additives. A substance which, because of a previous admixture, independent of the use for animal feeding, is necessarily present in one of the constituents of the feedingstuff as a residue from the previous manufacture of another product (in casu, the presence of potassium nitrate in skimmed-milk powder because nitrate is used as a preservative in cheese and whey from the manufacture of the cheese is mixed with the milk powder) may not be considered as an additive. It will therefore be governed by the directive on undesirable substances and not that on additives.[29]-[30] Imports. Animal and human health. Where, in application of Article 100 EEC, Community directives provide for the harmonisation of the measures necessary to ensure the protection of animal and human health and establish Community procedures to check that they are

observed, recourse to Article 36 is no longer justified and the appropriate checks must be carried out and the measures of protection adopted within the framework outlined by the harmonising directive. [35] Community law and national law. Food. Undesirable substances. Even after the entry into force of the Harmonising Feedingstuffs (Undesirable Substances) Directive 74/63, the member-States have, within the context of its Article 5, the power provisionally to consider as undesirable certain substances which, although known when that directive was adopted, do not appear in the list annexed to it, provided that the national*2 measures adopted apply on identical terms to both national products and those imported from other member-States. [40] The Court interpreted Article 5 of the Feedingstuffs (Undesirable Substances) Directive 74/63 in relation to an Italian prohibition on admission into Italy of milkbased animal feedingstuffs containing more than a given amount of nitrate. Representation Mario Ubertazzi and Fausto Capelli, both of the Milan Bar, for the defendant company. Braguglia for the Italian Government as amicus curiae. Marenco for the E.C. Commission as amicus curiae. Sacchettini for the E.C. Council as amicus curiae. Written briefs were also submitted by the United Kingdom Government as amicus curiae and by the three interveners in the main action (Intersyndicale des Fabricants d'Aliments d'Allaitement (Paris), Fachverband der Futtermittelindustrie eV (Bonn) and Vereniging van Nederlandse Mengvoederfabrikanten (The Hague)). The following case was referred to in argument: Simmenthal SpA v. Ministero delle Finanze (35/76), 15 December 1976:[1977] 2 C.M.L.R. 1, [1976] E.C.R. 1871. TABULAR OR GRAPHIC MATERIAL SET FORTH AT THIS POINT IS NOT DISPLAYABLE Facts Several Community directives which aim at harmonising national provisions intended to ensure that feedingstuffs do not endanger animal and human health have been adopted, inter alia Council Directive 70/524 of 23 November 1970 [FN1] concerning additives in feedingstuffs and Council Directive 74/63 of 17

December 1973 [FN2] on the fixing of maximum permitted levels for undesirable substances and products in feedingstuffs. FN1 [1970] O.J. Spec.Ed. 840. FN2 [1974] O.J. L38/31. Under Article 3 of Directive 74/63 member-States must prescribe that the undesirable substances and products listed in the annex shall be tolerated in feedingstuffs only under the conditions and up to the maximum content therein set out. Article 7 of the directive provides that feedingstuffs which conform to these stipulations can no longer be subject to any other marketing restrictions as regards the presence of undesirable substances and products. Article 5 however provides a safeguard clause which reads as follows: 1.'Where a member-State considers that a maximum content fixed in the annex, or that a substance or product not listed therein, presents*3 a danger to animal or human health, that member-State may provisionally reduce this content, fix a maximum content, or forbid the presence of that substance or product in feedingstuffs. It shall advise the other member-States and the Commission without delay of the measures taken and at the same time give its reasons. 2.In accordance with the procedure laid down in Article 10, an immediate decision shall be made as to whether the annex should be modified. So long as no decision has been made by either the Council or the Commission the member-State may maintain the measures it has implemented.' The procedure laid down in Article 10 entails a decision taken by the Commission after consultation of a standing committee for feedingstuffs. However if no opinion is delivered, or if the Commission proposes to adopt measures which are not in accordance with this opinion it must submit the proposal to the Council which must adopt the measures by a qualified majority. If the Council has not adopted any measures within 15 days, the Commission must adopt the measures and implement them forthwith, except where the Council has voted by a simple majority against such measures. Tedeschi, the plaintiff in the main action, bought from the defendant in the main action, Denkavit, 1,000 kilogrammes of feedingstuffs made from powdered milk and coming from the Netherlands to be delivered in September 1976, and paid a deposit of 350,000 lire. The feedingstuffs were not delivered because they were stopped at the Italian frontier by the public health inspector at the frontier on the basis of an urgent note from the Italian Minister for Health of 7 September 1976 prohibiting the entry of feedingstuffs containing powdered milk or whey having a nitrate content exceeding 30 and 50 parts per million respectively (milligrammes per kilogramme). The defendant in the main action, sued by his purchaser for repayment of the deposit and for damages, and the interveners pleaded before the Pretura di Lodi that the prohibition on importation was illegal. Since the Pretore di Lodi considered that the Community rules invoked by the parties to the main action before him did not clearly indicate the limits of the powers granted to the member-States to fix the maximum contents or prohibit

new substances not mentioned in the annex to Directive 74/63, he referred the following questions to the Court by order of 17 December 1976: 1.'Under the terms of the Community harmonizing directive, Council Directive No. 74/63/EEC of 17 December 1973 (Official Journal No. L38 of 11 February 1974) containing provisions intended to replace national provisions on the fixing of maximum permitted levels for undesirable substances and products in feedingstuffs, do the member-States, after incorporating all the Community provisions into their national legal systems, still enjoy a discretionary power to consider as undesirable specific substances, in this case nitrates, which, although known and recognised when Directive No. 74/63 was adopted and thus when it was incorporated into the national legal*4 systems, were excluded from the list of undesirable substances annexed to the aforesaid directive without any of the member-States raising objections or lodging complaints as provided for by Community law? 2.Does Article 5 of the above-mentioned Directive No. 74/63, having regarded to the ninth and thirteenth recitals of the preamble thereto and to Articles 7, 9 and 10 of that directive, and in the light of the provisions of Articles 30 and 36 of the Treaty of Rome, authorise a member-State, after the entry into force of the said directive and its incorporation into the national legal system of the said memberState, unilaterally to fix the maximum permitted level of a substance contained in a product from another member-State, in this case feedingstuffs made from powdered milk, even if, in the case of this substance which, moreover, is not included in the list of undesirable substances annexed to Directive No. 74/63, no maximum permitted level has ever been fixed in the past in either the provisions in force in the importing country or in the exporting country, thereby violating the standstill rule laid down in Article 31 of the Treaty and infringing upon the exclusive powers reserved to the Community institutions in the sectors coming under the common organisations of the market provided for in Articles 39, 40 et seq. of the Treaty? 3.Does Article 5 of the above-mentioned Directive No. 74/63, having regard to the ninth and thirteenth recitals of the preamble thereto and to Articles 7, 9 and 10 of that directive, and in the light of the above-mentioned provisions of Articles 30 and 36 of the Treaty of Rome, authorise a memberState, after the entry into force of the said directive and its incorporation into the national legal system of the said member-State, to prevent the importation of a product from another member-State (in this case feedingstuffs made from powdered milk), on the ground that this product contains a substance considered undesirable by the member-State in question, even if this substance is not included in the list of undesirable substances annexed to Community Directive No. 74/63/EEC, thereby violating the prohibition on quantitative restrictions contained in Article 30 of the Treaty and infringing upon the exclusive powers reserved to the Community institutions in the sectors coming under the common organizations of the markets provided for in Articles 39, 40 et seq. of the Treaty? 4.If the replies to the first three questions are in the affirmative, can Article 5 of the above-mentioned Directive No. 74/63 be considered valid within the meaning of Article 177 of the Treaty of Rome, in the light of Article 36 of the Treaty, and of the fact that it extends the powers of the member-States beyond the bounds held

to be proper by Article 36 by, in particular, permitting inter alia the said States (subject, moreover, to no clearly determined timelimits) to employ a provision contained in a Community directive in order to avoid the obligation to observe the directly applicable provisions in Article 30 of the Treaty relating to the prohibition of restrictions on the movement of goods within the EEC, the analogous provisions contained in the Community agricultural regulations applicable in the present case, namely, Regulations Nos. 804/68, 823/68 and 2727/75, and the provisions relating to the common organisation of the agricultural markets set out in Articles 39 and 40 et seq. of the Treaty?' *5 Opinion of the Advocate General (M. Henri Mayras) As appears from the file forwarded by the national court, the case in which this reference for a preliminary ruling has been made has arisen in the following circumstances: On 4 September 1976 the Italian undertaking Tedeschi placed an order with Denkavit Commerciale, also an Italian undertaking, for 10 quintals (1 metric ton) of powdered milk of the brand-name 'Start', to arrive between 20 and 25 September 1976. The product in question is a complete food for animals, composed partly of skimmed milk powder and partly of powdered whey. Whey is a by-product from the making of cheese. It contains residues of potassium nitrates, which are used in the process for the making of cheese. On 12 September 1976 Denkavit Commerciale ordered 250 quintals of 'Start' from the undertaking Pesch, in the Netherlands, delivery to take place before 30 September. On 16 September Pesch gave Denkavit Commerciale confirmation that 250 quintals of the complete feedingstuff of the brand-name specified were being sent by lorry. The next day, 17 September, Denkavit acknowledged receipt of Tedeschi's order and of the deposit paid and confirmed that it would deliver on 20 September. But the lorry carrying the goods from the Netherlands was stopped at the Italian frontier on 25 September upon an order from the inspector responsible for health controls. Since the goods in question did not comply with the requirements fixed by 'an urgent note' sent out by the Italian Ministry of Health on 7 September, they were refused entry and the lorry returned to the Netherlands. The 'note' in question set the maximum acceptance level of potassium nitrates at 30 parts per million for whole milk or skimmed milk, whether fresh or powdered, and at 50 parts per million for powdered whey. That measure applied both to products intended for human consumption and to those for animal consumption. On 5 October 1976, Denkavit Commerciale informed Tedeschi of this mishap and offered to return the deposit. But on 21 October 1976 Tedeschi claimed reimbursement from Denkavit Commerciale of a sum equal to twice the deposit for non-performance of the contract. It argued before the Pretore di Lodi, before whom the dispute was brought, that Denkavit had entered into the contract at a time when it had knowledge of the contents of the note from the Ministry. It had thus deliberately taken the risk that its goods might be stopped at the frontier. In its defence, Denkavit argued that the failure to perform the contract was due to an intervention on the part of the Italian authorities, contrary to the Community

provisions in force. Three national associations of manufacturers of feedingstuffs intervened in support of Denkavit Commerciale. It is in these circumstances that the Pretore di Lodi is asking you whether the*6 prohibition laid down by the Italian authorities against new substances considered harmful and the setting of maximum permitted levels of those substances are compatible with Article 5 of Council Directive 74/63 of 17 December 1973, the said substances not being mentioned in the annex to that directive. Although Tedeschi has not availed itself of its right to submit observations, the defendant in the main action, supported by the three national associations to which I have referred, the Council, the Commission, the Government of the United Kingdom and, of course, the Government of the Italian Republic has on the contrary shown great interest in the case. I should add that there exists an undertaking Denkavit Nederland, whose registered office is at Voorthuizen, at the same address as Pesch. The periodical Denkavit Aktualiteiten, No. 29, for the month of September 1969, published an article according to which there were--at that time--four different prices for skimmed milk powder: 150 guilders for skimmed milk powder intended for human consumption; 129 guilders for powder intended for the feeding of calves; 42.50 guilders for powder intended for the feeding of pigs and poultry; and finally the price of powder intended for export to nonmember countries. The article goes on: 'anybody who does not understand that this system leaves the door open to fraud must be very naIve.' Since Council Regulation 465/75 of 27 February 1975 a Community aid has been granted for buttermilk powder used as feed, as it was previously granted for skimmed milk powder, subject to the reservation that 'the skimmed milk and buttermilk resulting from the processing of milk into cream or butter ... may not be diluted in any way which is not normally part of the production method used, in particular with water and/or whey' (Commission Regulation 2114/75 of 11 August 1975). So far as I know, no Community rules have yet been adopted fixing the proportions in which it is permissible to add powdered whey to powdered skimmed milk in such a way that the latter continues to qualify for Community aids. On 14 September 1976 Denkavit Nederland complained directly to the Commission in Brussels about the restrictions thus imposed by the Italian authorities on freedom of movement for goods, despite the fact that those goods are covered by common organisations of markets, and that undertaking did not exclude the possibility that legal action might follow. You have heard the technical explanations of one of its representatives at the oral hearing. I As often happens, you are called upon, pursuant to Article 177, to rule on the application of a Community text by the authorities of a member-State to a particular case. Worded in abstract terms, the three questions which have been addressed to you by the Italian*7 court concern the extent of the power which is left to the member-States by Council Directive 74/63 of 17 December 1973 on

the fixing of maximum permitted levels for undesirable substances and products in feedingstuffs. The Italian court is asking you whether, if it be that Article 5 of that directive gives member-States a discretionary power in that respect, the said Article 5 is not invalid as being contrary to the principle of freedom of movement of goods (Article 30 of the Treaty) and not justified by Article 36 of the Treaty. There is no point in dwelling at length on the considerations which led to the adoption of the directive in respect of which you are called upon for a ruling. Let me simply remind you that it was not possible for the adoption of the basic regulations on the common organisations of markets in agricultural, vegetable or animal products and in particular Regulation 804/68 on 'milk and milk products' to settle all the ecological problems relating to the production of, free movement of, and trade in the products covered by those regulations. As is stated in the preamble to the directive, livestock production occupies a very important place in the agriculture of the Community and depends to a large extent on the use of appropriate good-quality feedingstuffs. But the feeding of animals is increasingly connected with the use of additives and, moreover, the feedingstuffs which are fed to them often contain, either naturally or because of the illconsidered addition of certain substances to the basic products of which they are composed, undesirable elements which can endanger animal health and, because of their presence in livestock products, human health. Now, the legislation concerning feedingstuffs for animals, which directly affects the functioning of the Common Market in agriculture (Article 100 of the Treaty) varies considerably from one member-State to another and depends on developments in scientific or technical knowledge. Therefore it is necessary for the national provisions relating to feedingstuffs to be brought into closer alignment or harmonised at Community level, the rules governing those products being an essential factor in the increase of productivity in agriculture. Additives in feedingstuffs have been dealt with by Council Directive 70/254 of 23 November 1970, as amended by Council Directive 73/103 of 28 April 1973. As regards the setting of maximum levels for undesirable substances and products in feedingstuffs, the Commission originally proposed that a regulation be adopted under Article 43 and, alongside that regulation, it proposed to the Council that a regulation concerning the marketing of feedingstuffs be adopted. What actually happened was that the Council adopted a directive under Articles 43 and 100 of the Treaty, and no regulation specifically covering*8 marketing was adopted. On 16 December 1976, the Council adopted Directive 77/101 on the marketing of straight feedingstuffs for animals. But that directive, published during the course of the proceedings, sets 1 January 1979 as the date by which the member-States must have brought into force the national provisions necessary to comply with it. The system introduced is as follows: the annex to the directive contains a list of the substances or products the presence of which beyond a certain level, also stated in the annex, in feedingstuffs renders those feedingstuffs undesirable and, accordingly, gives rise to a prohibition on the marketing of them. That list was drawn up by experts for each feedingstuff, and the maximum content has been

set in parts per million of unadulterated matter. The fact that a substance was not included in the annex at the time when the directive was adopted does not prevent the later 'aggiornamento' (bringing up to date) of the text. Since it is necessary constantly to adjust the contents of the annex to developments in scientific and technical knowledge 'Member-States should retain the power, if animal or human health is endangered, to reduce temporarily the fixed maximum permissible levels or to fix maximum levels for other substances or products, or to prohibit the presence of such substances or products in feedingstuffs'. That power is to be exercised in accordance with the provisions of Article 5. However 'in order that a member-State should not abuse that power, possible amendments to the annex to this directive based on supporting documents should be decided on by emergency Community procedure'. The latter procedure is explained in Article 10 and it presupposes action on the part of a 'Standing Committee for Feedingstuffs', according to detailed rules which are not wholly unlike the detailed rules governing the Management Committees contained in the basic regulations. II The Italian Government is arguing that in reality the intention of its officials has been to apply not the directive on 'undesirable substances' but the directive on 'additives', and it is with regard to the latter that the action of the Italian authorities should really be assessed. Certainly, the nitrate in question has been added to the milk with a view to turning it into cheese and it is because the powdered whey, a by-product of the process involved, has been added to the powdered milk that it is found in the mixture for animals. But it is then found in the natural state in that mixture, and it is as such that it is undesirable. Thus although it is certainly not wrong to say that, as part of the whey mixed into the skimmed milk powder, the nitrate present naturally in the whey is added to the compound feedingstuff, that substance has not been so added for the purpose with which the*9 directive on 'additives' is concerned, namely in order to improve or increase the production of livestock, and the levels of potassium nitrates found, on which the Italian Government bases its case, are not evidence of the addition of a substance not permitted by Community rules (the 'additives' directive). In other ways, the two directives have many points in common. Both made provision for action on the part of the same Standing Committee for Feedingstuffs, created by Council Decision of 20 July 1970, and the rules governing action by that Committee have been practically identical in both cases since the time when, by Council Directive of 28 April 1973 (No. 73/103), the procedure for amending the annexes to the 'additives' directive has been aligned on the procedure in the 'undesirable substances' directive. By virtue of Articles 9 and 10 of the latter directive, the Committee exercises a direct influence on the deliberation procedure. Where the procedure laid down in Article 9 is to be followed (Community amendment to be made by reason of developments in scientific and technical knowledge, for example the inclusion of sodium nitrates by Commission Directive 76/934 of 1 December 1976), as also

where the procedure laid down in Article 10 is to be followed (unilateral amendment made by a member-State), the Commission may adopt the measures concerned only if the Committee delivers an Opinion in favour of them. If the Committee does not deliver a favourable Opinion or if no Opinion is delivered within the time-limit set by the Chairman (Article 9 (3)) or within two days (Article 10 (3)), the Commission shall without delay propose to the Council the measures to be adopted; the Council acts without consulting the Parliament. If the Council has not acted within three months (Article 9 (4)) or 15 days (Article 10 (4)), the Commission shall adopt a final decision and implement it forthwith. In practice, the powers of the States are the same: with regard to additives, the directive lists permitted substances; all others are prohibited. A member-State may temporarily suspend authorisation for the use of an additive or reduce the maximum permitted level. As regards 'undesirable substances', the directive lists prohibited substances, but this does not mean that the presence of any other 'undesirable' substances is therefore permitted, for there remains the reservation in Articles 5 and 6. I shall refrain from considering whether the questions which have been referred to you are relevant or necessary, and I shall direct my thinking exclusively to the directive on 'undesirable substances'. In any event, the Italian Government is of the opinion--rightly or wrongly--that beyond a certain level the presence, even natural and involuntary, of potassium nitrates is undesirable, which in practice has the same effect as in the case where an unauthorised additive is involved. *10 III Whilst I shall refrain from assessing whether the national measure contested in the main action is in accord with the Treaty, I ought nevertheless, in order that the context in which the questions arise should be perfectly plain, to examine the circumstances in which the Italian measure was adopted. The member-States were required to bring into force on 1 January 1976 the laws, regulations and administrative provisions necessary to comply with Directive 74/63. The Italian Government 'received' the provisions of that directive into the national legal system by Ministerial Decree of 30 December 1975, which entered into force on 1 January 1976. Potassium nitrates do not appear among the substances listed in the annex. On 5 August 1976 the Italian Ministry of Health, by 'urgent note', ordered veterinary controls on imports of powdered whey and compound feedingstuffs containing whey, and fixed the maximum tolerable level of potassium nitrate at one part per million. Since that limitation did not result from provisions then in force, it constituted a new measure and the rules in Article 5 of the directive as to the introduction of such measures were applicable to it. On 7 September the 'urgent note', which is contested in the main action, was adopted as an order by the same Ministry (Directorate General for Veterinary Services). It appears from the replies and documents produced at the hearing that at Community level those national measures were accompanied by the following

actions and interventions: Starting in July 1976, the Italian Government made representations to the competent authorities in France, the Republic of Germany and the Netherlands concerning the presence of a high level of nitrates in feedingstuffs because of the addition of powdered whey to those feedingstuffs. On 27 July 1976, the Permanent Representation of the Italian Republic in Brussels asked the Chairman of the Standing Committee for Feedingstuffs, who is a representative of the Commission, for the presence of potassium nitrates at a level of 40 to 4,000 parts per million in powdered whey coming from France, the Netherlands and Germany to be put on the agenda for the next meeting of the Committee, arranged for 6 and 7 September. On 9 August 1976, the Commission's Directorate General for Agriculture asked the Italian Government for explanations concerning the controls carried out at the Italian frontier with a view to detecting the presence of potassium nitrates or sodium nitrates in powdered milk intended for human and animal consumption, in powdered whey and in feedingstuffs. It reminded the Italian Government that for the purpose of the Community procedure under Article 5 (2) of Directive 74/63 the other member-States and the Commission must be advised and that reasons must be given.*11 On 10 August, the Italian Minister of Health asked the Commission whether it was aware of the presence of potassium nitrates in the products in question and requested it to study the problem. On 20 August, the Directorate General for Agriculture, addressing itself to the Italian Permanent Representation and referring to Article 7 of the directive, requested the Italian Government to supply explanations before 26 August. On 6 and 7 September, the Standing Committee met to examine the controls carried out by the Italian authorities since the month of July. It would appear from a telex sent to its members by the European Federation of Compound Animal Feedingstuffs Manufacturers, 223, Rue de la Loi, Brussels, that during that meeting the Commission put forward a proposal for fixing limits for the levels of nitrates. Since the Committee refused to accept that proposal, the Commission withdrew it and decided to address itself to the 'Scientific Committee for Animal Nutrition', which I shall be mentioning again later. On 17 September, the Directorate General for Agriculture, referring to the meeting of the Standing Committee of 7 September, requested the Italian Permanent Representation, with a view to solving the problem within the Community, to let it have, before 24 September, certain information on the controls carried out and on the scientific reasons for them, and on the proof of the presence of whey in the consignments refused entry. On 27 September, the Italian Permanent Representation, referring to the meeting of the Standing Committee of 6 and 7 September, during which the Italian experts supplied justifications, renewed its request to the Commission to draft concrete proposals in order 'to harmonize the sector' in accordance with the requirements of public health. Finally, on 7 October 1976, the Italian Permanent Representation made it known that documents as to toxicity had been sent off to the Commission the previous

day and that the latter would receive them in the near future. The said documents contained the 'reasons' referred to in Article 5 (1) of the directive. IV From this detailed exposition the following findings, it seems to me, may be arrived at: Starting in July 1976, the Italian authorities adopted a measure analogous to the measure contested (observations of the Commission, p. 5). On 19 July, 22 July and 31 August, the Italian Government informed the competent authorities of the Federal Republic of Germany, the French Republic and the United Kingdom of its problem. In any event, the question as to the possible harmfulness of*12 residues, to be explained on technological grounds, of potassium nitrates in powdered whey and in compound feedingstuffs containing whey was undoubtedly submitted to the Standing Committee for Feedingstuffs on 6 September, namely on the day before the Italian 'urgent note' was adopted as an order, and it was only on 25 September that the goods were stopped at the frontier. Although the Italian 'documents as to toxicity' were not officially submitted to the Standing Committee before 7 October, it appears that prior to that date the Commission was well aware of the problem because it 'accelerated' the establishing of the Scientific Committee for Animal Nutrition (Decision of 24 September 1976, published in the Official Journal of 9 October 1976), for the specific purpose of submitting this problem to it. That Committee, composed of highly qualified scientists, only has a consultative function, unlike the Standing Committee which takes part in the decision-making process. The Commission has confirmed that as at 9 March 1977 the said Scientific Committee, which met several times during the last quarter of 1976, was not yet in a position to report. In any event, from the time when the Standing Committee officially received the Italian Government's statement of reasons, the procedure under Article 5 of the directive was properly set in motion, and only at the end of that procedure will it be possible to say whether the Italian measure was justified. Is it possible to say that from 7 September to 7 October the Italian measure was 'invalid', but that since the latter date has become 'provisionally valid' again until such time as the procedure under Articles 5 and 10 of the directive ends in a way unfavourable to the Italian Republic? I cannot state my views on this point in the context of the present dispute. But this I can say: Whilst it is a fact that before even receiving the Italian Government's ' statement of reasons', the Commission chose to consult the Scientific Committee, though not in any way obliged to do so, that fact did not relieve it of the duty to seek a swift end to a situation which traders could hardly be expected to tolerate. Its duty was to submit a 'draft of the measures to be adopted' to the Standing Committee and to get its opinion. If the measures were not in accordance with the opinion of the Committee or 'if no Opinion' was delivered, it was the Commission's duty to propose without delay the measures to be adopted. If the Council did not, by qualified majority, adopt the measures proposed by the

Commission, or did not adopt any measures, and unless the Council had voted by a simple majority against the measures proposed, it was again the Commission's duty to adopt the measures proposed and to implement them forthwith. The procedure instituted by the Commission on 16 December 1976 against the Italian Republic for failure to act, the length and result of which cannot be foreseen, has not the*13 purpose of, and cannot replace the procedure under, Articles 5 and 10 of the directive. Moreover, so long as a decision has not been adopted by the Commission, the member-State 'may maintain the measures it has implemented' (Article 5 (2)). V The system provided for by Article 5 of the directive may interfere with Article 30 of the Treaty, but the latter provision is only applicable ' without prejudice' to Article 36. Admittedly, the absolute priority given to the protection of the health of consumers and of animals can in fact conceal economic motives. Then again, Article 36 provides that any prohibitions or restrictions introduced 'shall not ... constitute a means of arbitrary discrimination or a disguised restriction on trade between member-States'. Article 5 itself does not cover this question fully and it has to be examined as part of the Standing Committee Procedure to prevent abuse by member-States. The very purpose of Article 10, and the time-limits which it prescribes, are intended to prevent such abuse. It is possible the Italian Government may have availed itself of the directives on 'additives' or on 'undesirable substances' in order to combat commercial fraud which ought rather to be dealt with by the Management Committee for Milk and Milk Products. However, the inappropriate use of the two directives on harmonisation or the fact that the procedure under Article 10 of the directive on 'undesirable substances' may not have been or may not have been fully observed, or that it has not yet come to anything, cannot affect the validity of Article 5. It remains necessary that this procedure should function. The European Parliament has, on several occasions, vigorously opposed allowing experts to limit the Commission's decision-making power. It has emphasised that the creation of such committees must not bring about any limitation on the latter's responsibilities. Accordingly, it does not seem to me that there is anything illegal in the system organised by Article 5 of the directive. VI As to the arbitrary nature of the discrimination which may thus be exercised at the frontier and only at the frontier, on trade between member-States, I shall confine myself to pointing out that Article 7 provides: 'Member-States shall ensure that feedingstuffs which conform to this directive are not subject to any other marketing restrictions as regards the presence of undesirable substances and products', and that under Article 8 (1): 'Member-States shall take all necessary measures to ensure that feedingstuffs are officially controlled, at least by random sampling, to verify whether the conditions laid down in this directive

are satisfied'. Given that the conditions required in order that feedingstuffs may be made directly*14 available for consumption by animals must be satisfied at all stages of trading up to delivery to the final user, they must be satisfied when they are first put into circulation and when they are introduced into a member-State. It is natural for official controls to start at the frontier not only for obvious practical reasons, but also because trading or marketing begins at the frontier, particularly in the case of a product which is not manufactured on the same scale or under the same conditions as within the country. In any event, to use the standard wording, it is in the first place for the national court to assess whether the controls carried out were indeed in the nature of random sampling, were not arbitrary, and did not give rise to a ' disguised' restriction on trade between member-States, and whether the setting of the levels in question was not adopted in such a way as to put at a disadvantage, in law or in fact, imports from other member-States. I am of the opinion that you should rule that: 1. Even after incorporating the 'harmonising' Directive 74/63 into their legal system, the member-States have the power to consider provisionally as undesirable certain substances which, although they were known about when Directive 74/63 was adopted, do not appear in the list annexed to that directive; 2. In this connection, the procedure under Articles 5 and 10 must be followed, in order that the compatibility of the unilateral measure adopted by the memberState with the rules of the Treaty shall be ascertained as quickly as possible; 3. So long as no decision has been made by either the Council or the Commission, the member-State may maintain the measure which it has implemented and whereby it has set a maximum level for a substance which it has considered undesirable, and may adopt such restrictions on marketing as give effect to that measure, provided that they do not constitute a means of arbitrary discrimination or a disguised restriction on trade between memberStates. 4. Examination of the file has disclosed no factor of a kind such as to affect the validity of Article 5 of Council Directive 74/63. JUDGMENT [1] By order of 17 December 1976, entered in the Register of the Court of Justice on 11 January 1977, the Pretura di Lodi submitted to the Court of Justice several questions relating, on the one hand, to the interpretation of Council Directive 74/63 of 17 December 1973 on the fixing of maximum permitted levels for undesirable substances and products in feedingstuffs [FN3] in particular Article 5*15 thereof, and on the other, to the validity of the said Article 5. [2] These questions have been submitted in the context of a dispute concerning the nonperformance of a contract for the supply of feedingstuffs made from powdered milk in which the defendant in the main action maintains, in order to justify its failure to deliver the goods, that they were illegally stopped at the border by the Italian health authorities because their potassium nitrate content exceeded that permitted by those authorities. [3] This measure was adopted on the basis of an

urgent note (biglietto urgente) of 7 September 1976 sent by the Italian Minister of Health to the veterinary authorities at frontiers, ports and airports and to the provincial authorities prohibiting the importation of milk-based feedingstuffs where the nitrate content of those feedingstuffs exceeds 30 parts per million in whole milk powder and skimmed-milk powder and 50 parts per million in powdered whey. [4] According to the defendant and the interveners in the main action, the Italian measures are incompatible with Directive 74/63. FN3 [1974] O.J. L38/31. [5] According to the fourth recital of the preamble to that directive, its purpose, taking into account the fact that it is impossible to exclude totally the presence of certain undesirable substances or products in feedingstuffs, is to reduce their content in order to prevent them from harming animal health or, because of their presence in animal products, human health. [6] Under Article 3 of the directive 'member-States shall prescribe that the substances and products listed in the annex shall be tolerated in feedingstuffs only under the conditions therein set out', that is, below a maximum level. [7] According to Article 7 'member-States shall ensure that feedingstuffs which conform to this directive are not subject to any other marketing restrictions as regards the presence of undesirable substances and products'. [8] However, Article 5 (1) provides that: 'where a member-State considers that a maximum content fixed in the annex, or that a substance or product not listed therein, presents a danger to animal or human health, that member-State may provisionally reduce this content, fix a maximum content, or forbid the presence of that substance or product in feedingstuffs. It shall advise the other member-States and the Commission without delay of the measures taken and at the same time give its reasons'. [9] Under Article 5 (2), where a member-State has recourse to the provisional measure referred to in the first paragraph thereof, a decision must immediately be taken as to whether any modification to the annex should be made in accordance with the procedure laid down in Article 10 of the directive. [10] Article 5 (2) continues: 'So long as no decision has been made by either the Council or the Commission the memberState may maintain the measures it has implemented'. [11] The file shows that as early as 27 July 1976 the Italian authorities drew the attention of the Commission to the presence*16 'in certain consignments of whey from France, the Netherlands and the Federal Republic of Germany of potassium nitrate in levels varying from 40 to 4,000 parts per million (milligrammes per kilogramme), residues from the manufacture of certain types of cheeses' and asked 'that the problem of the harmonization of national legislation concerning the presence of that substance be examined'. [12] After deciding by an urgent communication of 5 August 1976 to intensify laboratory tests on imported consignments of whey and compound fodder containing whey and initially fixing the maximum nitrate level at one part per million, the Italian authorities adopted the contested measure on 7 September 1976. [13] After exchanges of notes between the Community authorities and the Italian authorities during the months of August and September, on 7 October

1976 the latter sent the Commission documents as to toxicity by way of the statement of reasons referred to in Article 5 (1) of the directive. [14] The Italian Government contests the relevance of the questions referred to the Court with regard to the outcome of the main action and observes that the measure in question was not adopted on the basis of Article 5 of Directive 74/63 but in accordance with Council Directive 70/524 of 23 November 1970 concerning additives in feedingstuffs [FN4]. [15] The distinction between the field of application of these two directives is important because all marketing of feedingstuffs containing unauthorised additives is clearly prohibited whereas in so far as undesirable substances are concerned the prohibition on marketing concerns only feedingstuffs containing the undesirable substances expressly listed in the annex to the directive, unless Article 5 and the procedure laid down in Article 10 are applied. [16] If it were necessary to consider as an unauthorised additive the potassium nitrate whose presence in the imported feedingstuffs has been established it would follow that the Italian measure prohibiting it was absolutely justified and, moreover, that there was no need for the measure to be followed by the implementation of the procedure laid down in Article 10 of Directive 74/63 in order to decide whether or not it is necessary to complete the list of undesirable substances. FN4 [1970] O.J. Spec.Ed. 840 [17] Article 177 is based on a distinct separation of functions between national courts and tribunals on the one hand and the Court of Justice on the other, and it does not give the Court jurisdiction to take cognisance of the facts of the case, or to criticise the reasons for the reference. [18] Therefore, when a national court or tribunal refers a provision of Community law for interpretation, it is to be supposed that the said court or tribunal considers this interpretation necessary to enable it to give judgment in the action. [19] Thus the Court cannot require the national court or tribunal*17 to state expressly that the provision which appears to that court or tribunal to call for an interpretation is applicable. [20] The Court may however provide the national court with the factors of interpretation depending on Community law which might be useful to it in evaluating the effects of the provision which is the subject-matter of the questions which have been referred to it. [21] Directive 74/63 (undesirable substances) specifies that it applies ' without prejudice' to the provisions concerning, in particular, additives in feedingstuffs and it is therefore important, in order to reach a useful interpretation of the provisions thereof, to state precisely its field of application in relation to Directive 70/524 (additives). [22] Under Article 2 of Directive 70/524, 'additives' are substances which, when incorporated in feedingstuffs, are likely to affect their characteristics or livestock production. [23] The fifth recital of the preamble to that directive specifies that additives mean: 'as a general rule ... substances which improve both the feedingstuffs in which they are incorporated and livestock production'. [24] Although Directive 74/63 does not define the concept of 'undesirable

substances and products', the third and fourth recitals of the preamble thereto specify however that undesirable substances or products which 'feedingstuffs often contain' are involved and that 'it is impossible to exclude totally the presence' of them. [25] The file and the observations submitted by the parties during the hearing show that the presence of potassium nitrate in the imported feedingstuffs in excess of the maximum levels fixed by the Italian Government results from the fact that a quantity of whey, which is a by-product of the manufacture of cheese, during which the nitrate is used as a preservative, is mixed with the skimmedmilk powder. [26] The Italian Government considers that the nitrate added during the caseation process continues to be an additive in the subsequent stages of the use of the whey and may not be considered as a substance which is naturally or inevitably present in the feedingstuffs to which the whey has been added. [27] On the other hand, the defendant in the main action and the Commission claim that the nitrate may not be considered as an additive because it was not intentionally added to the feedingstuffs made from powdered milk but was already there as a residue from a previous stage in the production of powdered milk and cheese. [28] A comparison of the above-mentioned recitals of the preambles to the directives shows that Directive 70/524 (additives) and directive 74/63 (undesirable substances) although both relating to the composition of feedingstuffs make, as regards their respective fields of application, a distinction between certain substances which are intentionally added to those feedingstuffs so as to produce a favourable effect on their characteristics and, on the other, undesirable*18 substances which are inevitably present in those feedingstuffs either in the natural state or as residues from processing previously undergone by those feedingstuffs or by the constituents of those feedingstuffs. [29] In these circumstances a substance which, because of a previous admixture, independent of the use for animal feeding, is necessarily present in one of the constituents of the feedingstuff as a residue from the previous manufacture of another product may not be considered as an additive. [30] The control of the presence of such substance comes within Directive 74/63 (undesirable substances) and not within Directive 70/524 (additives). The first question [31] The first question asks in substance whether, under the terms of Directive 74/63 and in view of a possible application of the provisional measure referred to in Article 5 thereof, the member-States still have the power to consider as undesirable substances certain substances (in this case nitrates) which, although known when Directive 74/63 was adopted and incorporated into the national legal systems, were excluded from the list of undesirable substances annexed to the directive. [32] Under Article 1 (g) of Council Regulation 804/68 of 27 June 1968 on the common organisation of the market in milk and milk products, dairy-based feedingstuffs come within that organisation of the market and must, under Article

22 of the same regulation, be admitted to free circulation between the memberStates. [33] National measures regulating the composition of feedingstuffs may in certain cases constitute measures having an effect equivalent to quantitative restrictions which are however capable, where they are justified by the protection of animal or human health, of coming within the application of Article 36 of the Treaty. [34] Article 36 is not designed to reserve certain matters to the exclusive jurisdiction of member-States but permits national laws to derogate from the principle of the free movement of goods to the extent to which such derogation is and continues to be justified for the attainment of the objectives referred to in that Article. [35] Where, in application of Article 100 of the Treaty, Community directives provide for the harmonisation of the measures necessary to ensure the protection of animal and human health and establish Community procedures to check that they are observed, recourse to Article 36 is no longer justified and the appropriate checks must be carried out and the measures of protection adopted within the framework outlined by the harmonising directive. [36] Directive 74/63 was adopted and a Community control procedure was introduced for the purpose of harmonising the national provisions. [37] Within the context of the harmonisation which has been brought about, Article 5 however permits member-States provisionally*19 to prevent the marketing on their territory of feedingstuffs which contain substances which may be undesirable for animal or human health although they are not mentioned in the annexes to the directive. [38] Although Articles 6 and 9 of the directive provide that, following a Community procedure, it will be possible to amend the list of undesirable substances on the basis of the development of scientific or technical knowledge, it was however justified in also providing for the means of remedying a lacuna in the harmonised legislation when a danger requiring immediate action arises. [39] The eventuality provided for in Article 5 covers the case in which substances which were previously considered not to be harmful prove to be so, in particular if, considered in a previous stage as not harmful because they are only present in minute quantities, it appeared that in other feedingstuff mixtures or in mixtures made in new proportions, they are present in a proportion which may make them undesirable. [40] It is therefore necessary to reply to the first question that even after the entry into force of the harmonising directive, Directive 74/63, the member-States have, within the context of Article 5 of that directive and subject to the material and procedural requirements laid down therein, the power provisionally to consider as undesirable certain substances which although known when that directive was adopted, do not appear in the list annexed thereto, provided that the measures adopted apply on identical terms to both national products and to products imported from other member-States. The second question [41] The second question asks in substance whether Article 5 of Directive 74/63 enables a member-State to fix unilaterally the maximum permitted level of a

substance contained in imported feedingstuffs made from powdered milk when in the past no maximum level had ever been fixed either in the exporting memberState or in the importing member-State. [42] Subject to the obligation not to discriminate between imported products and national products, it is necessary, for the reasons put forward in reply to the first question, to reply to the second question in the affirmative. [43] In fact, although substances have not been recognised as undesirable because in a previous stage the composition of feedingstuffs was such that those substances only appear in minute quantities, it is possible that different mixtures may contain the same substances in quantities such that because of their level they may be considered as undesirable. The third question [44] The third question asks in substance whether Article 5 of the directive enables the member-State, when applying Article 5 (1), to prevent the importation of the product concerned from another member-State. *20 [45] In so far as Article 5 (1) of Directive 74/63 enables the member-State to fix provisionally with regard both to national products and to imported products conditions other than those laid down in Directive 74/63, it must also be possible for it to prohibit the marketing of the products which have been found to infringe the temporary national provisions. [46] Such a prohibition on marketing on the national market may, for products coming from other member-States, take the form of a prohibition on importation, since importation may be treated, for the purposes of the application of the directive, as the first marketing on the territory of the member-State. [47] Such a prohibition may not however be issued in a general manner and may concern only consignments of goods from which it appears as the result of a check, even a random sampling, that they contain substances considered provisionally as undesirable within the context of Article 5 of the directive. The fourth question [48] If the Court replies in the affirmative to the first three questions, the next question asks whether Article 5 of Directive 74/63 must be considered as valid to the extent to which it extends the powers of the member-States beyond the limits justified by Article 36 and permits them, by means of the last sentence of Article 10, to escape, without any limitation as to time, the directly applicable provisions of Article 30 of the Treaty and those concerning the common organisation of the agricultural markets. [49] The directive, whilst obliging the member-States to adopt common provisions in relation to the presence of harmful or undesirable substances in feedingstuffs leaves those member-States by means of Article 5 a discretionary power to implement provisional supplementary measures relating to other substances or to the level of the substances listed in the annex to the directive. [50] Under Article 5 (2), when a member-State has brought into force

provisionally a measure such as that referred to in Article 5 (1), an immediate decision must be made as to whether the annex should be modified in accordance with the procedure laid down in Article 10. [51] The defendant in the main action alleged in support of its statement that Article 5 of the directive is invalid that the procedure laid down in Article 10 might in certain cases lead to an indefinite extension of the provisional measure by virtue of the last sentence of that Article. [52] Article 10 (4) provides that a decision on the modification of the annex must be adopted either by the Commission in accordance with the opinion of the Standing Committee for Feedingstuffs or, if the Commission is not in accordance with that opinion or if the Committee does not deliver an opinion, by the Council at the proposal of the Commission. [53] Article 10 (4) continues by*21 specifying that: 'If the Council has not adopted any measures within fifteen days of the proposal being submitted to it, the Commission shall adopt the proposed measures and implement them forthwith, except where the Council has voted by a simple majority against such measures'. [54] It is true that the last sentence of Article 10 prevents the Commission from implementing the proposal rejected by the Council where its proposal has been rejected by the Council and even where, in that case, the latter does not put forward an alternative solution. [55] However the Commission still has jurisdiction to issue, in accordance with the procedure laid down in the first subparagraph of Article 10 (4), any other measure which it considers appropriate. [56] The final paragraph of Article 10 therefore does not have the effect of paralysing the Commission or of enabling the national measure adopted provisionally to be prolonged indefinitely. [57] It is therefore necessary to conclude that consideration of the fourth question has disclosed no factor of such a kind as to affect the validity of Article 5 of the directive. Costs [58] The costs incurred by the Government of the Italian Republic, the Government of the United Kingdom and the Council and the Commission of the European Communities which have submitted observations to the Court are not recoverable. [59] 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, the decision on costs is a matter for that court. Order On those grounds, THE COURT, in answer to the questions referred to it by the Pretura di Lodi by order of 17 December 1976 HEREBY RULES: 1. Even after the entry into force of harmonising Directive 74/63, the memberStates have, within the context of Article 5 of that directive and subject to the material and procedural requirements laid down therein, the power provisionally to consider as undesirable certain substances which, although known and recognised when that directive was adopted, do not appear in the list annexed

thereto, provided that the measures adopted apply on identical terms to both national products and to products imported from other member-States. 2. Subject to the obligation not to discriminate between imported products and national products, Article 5 of Directive 74/63 enables a member-State to fix, on a provisional basis, the maximum permitted level of a substance contained in imported feedingstuffs made from powdered milk even though no maximum level has ever been fixed*22 in the past either in the exporting member-State or in the importing member-State. 3. Article 5 of Directive 74/63 enables a member-State to prohibit the marketing of the products which have been found to infringe the temporary national provision which it is empowered to adopt. For products coming from other member-States such prohibition on marketing may take the form of a prohibition on importation. 4. The consideration of the fourth question has disclosed no factor of such a kind as to affect the validity of Article 5 of Directive 74/63. (c) Sweet & Maxwell Limited [1978] 1 C.M.L.R. 1 END OF DOCUMENT