This case concerned the interpretation of Regulation 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF).
On 26 May 2005, Agrofarm submitted an application to the PRIA for area payments and support for environmentally-favourable production. Having already made the necessary preparations in 2004, Agrofarm was ready to give a commitment to implement that type of production in order to obtain rural development support. However, the application was rejected and Agrofarm appealed.
The referring court asked whether the provisions of Art. 24(1) of Regulation 1257/1999, read in conjunction with Arts 37(4) and 39 thereof, precluded a Member State from changing, on the ground of insufficient budgetary resources, the conditions for the grant of rural development support in order to restrict the class of eligible applicants to farmers already concerned by a decision to grant such support in the previous budgetary year.
The Court first of held that, in order to guarantee the transparency of the measures contemplated, the Member States were to establish, in accordance with Art. 41 of Regulation 1257/1999, rural development plans, including, inter alia, the description of the support measures for rural development such as agri-environmental measures and an indicative overall financial table summarizing the national and Community financial resources.
Those programs were to be submitted to the Commission which must appraise the plans to determine whether they were consistent with the regulation, although that approval did not confer on them the nature of an act of Community law (see, to that effect, Case C-336/00 Huber ). The Member States must try to manage their financial resources adequately so as to enable each eligible applicant, within the meaning of that regulation, to benefit from rural development support.
However, the Court held that Member States might lay down further or more restrictive conditions for granting Community support for rural development provided that such conditions were consistent with the objectives and requirements laid down in the regulation and that support measures might, where necessary, be subsequently revised by the Member States in order to ensure compatibility and consistency.
The Court furthermore reiterated that, subject to the compatibility and consistency with the objectives and provisions of Regulation 1257/1999, and compliance with the general principles of Community law, with which the Member States must comply when they implement Community rules (see, to that effect, Joined Cases C-181/04 to C-183/04 Elmeka (2006)), such as the principles of equal treatment, the protection of legitimate expectations, and proportionality, the national authorities had the option of using a measure other than the one provided for in the Development Plan.
The Court reiterated that the principle of equal treatment required that comparable situations must not be treated differently and that different situations must not be treated in the same way unless such treatment was objectively justified (Joined Cases C-453/03, C-11/04, C-12/04 and C-194/04 ABNA and Others ).
The Court held that a farmer who submitted an application for rural development support for the first time was not in the same situation as a farmer who, in accordance with a decision already made, was bound to comply with a certain number of obligations with respect to his commitment to engage in environmentally-favourable farming.
As regards the principle of the protection of legitimate expectations, the Court held that, in the field of the common agricultural policy, economic operators were not justified in having a legitimate expectation that an existing situation which was capable of being altered by the competent authorities in the exercise of their discretionary power would be maintained (see Case C-310/04 Spain v Council ).
The Court concluded that Article 24(1) of Regulation 1257/1999, read in conjunction with Arts 37(4) and 39 thereof, did not preclude a Member State from restricting, on account of insufficient budgetary resources, the class of recipients of rural development support to farmers already concerned by a decision to grant such support in the previous budgetary year.
Text of Judgment