JUDGMENT OF 16. 6. 1970 — CASE 69/69 ALCAN v COMMISSION
In Case 69/69
THE COURT composed of: R. Lecourt, President, R. Monaco and P. Pescatore (Rapporteur), President of Chambers, A. M. Donner, A. Trabucchi, W. Strauß and J. Mertens de Wilmars, Judges, Advocate-General: J. Gand Registrar: A. Van Houtte
gives the following
JUDGMENT
Issues of fact and of law
I — Facts
According to the terms of Protocol No XII concerning unwrought aluminium (heading 76.01 A), dated 2 March 1960, the Member States of the Community at the time of the signature of the agreement on the establishment of a part of the Common Customs Tariff relating to products in List G appearing in Annex I to the EEG Treaty, agreed to the following provisions which are annexed to the agreement :
‘(1) As regards unwrought aluminium (heading 76.01 A), as from the first alignment on the Common Customs Tariff, the Commission shall authorize the Federal Republic of Germany and the Benelux countries on their request to open annual tariff quotas subject to a duty of 5 % to cover the import needs of their processing industries, subject to the condition that goods imported under the benefit of such quotas are processed within the importing Member State. (2) These quotas may not exceed the limits beyond which transfers of work to the detriment of other Member States become apparent. (3) The Commission may revise quotas thus opened in accordance with the development of the importing needs of the industries in question.’
In application of these provisions the authorization to open national tariff quotas for unwrought aluminium at the reduced duty of 5 % was granted annually to the Belgo-Luxembourg Economic Union as from 1 January 1964—the date on which Belgium and Luxembourg made the first alignment on the Common Customs Tariff as regards the. product in question—up to 13500 metric tons for 1964, 26000 metric tons for 1965, 35000 metric tonns for 1966 and 35000 metric tones for 1967.
On 3 May 1967 the Belgian Government, acting in the name of the Belgo-Luxembourg Economic Union, asked the Commission for the grant in respect of the year 1968 of a tariff quota of 40000 metric tons subject to a duty of 5 % of unwrought aluminium.
It accordance with the undertaking signed by the Community at the conference on the commercial negotiations of 1964 to 1967 known as ‘the Kennedy Round’, held under the auspices of the parties subscribing to the General Agreement on Tariffs and Trade (GATT), the Council, by its decision of 29 February 1968 (OJ L 61 of 8. 3. 1968, p. 7), opened for the year 1968 a Community tariff quota of 130000 metric tons at the reduced duty of 5 % for unwrought aluminium, the base rate for this product being fixed at 9 %.
Out of this quota, a first instalment of 110000 metric tons was divided among all the Member States, the share of Belgium amounting to 9750 metric tons and that of Luxembourg to 1650 metric tons.
The second instalment of 20000 metric tons constituted a Community reserve intended to cover the subsequent needs of Member States which had exhausted their initial share.
On the quota of the Belgo-Luxembourg Economic Union becoming exhausted during the third quarter of 1968, the permanent representatives of both Belgium and Luxembourg accredited to the Communities made a new request to the Commission, by letters of 14 and of 23 October 1968 respectively, based on Protocol No XII asking for the opening of a national tariff quota of 5000 metric tons of unwrought aluminium at a duty of 5 % of the benefit of the Belgo-Luxembourg Economic Union.
By letter of 24 December 1968, the permanent representatives of Belgium, taking into account further needs, increased the request from 5000 to 8000 metric tons.
The Commission rejected the request—after the end of the financial year to which it referred—by a decision of 12 May 1969, notified to the Belgian Government on 13 May 1969.
II — Procedure
By an application made on 25 November 1969 the applicant companies requested the Court to annul the decision of the Commission of 12 May 1969 refusing to grant to the Kingdom of. Belgium and to the Grand Duchy of Luxembourg a tariff quota for the year 1968 for unwrought aluminium under tariff heading 76.01 A of the Common Customs Tariff and to take note that they reserved the right to claim compensation for the damage caused by continuing the proceedings or subsequently.
By an application lodged on 24 December 1969 the Commission requested the Court under Article 91 of the Rules of Procedure to decide upon the admissibility of the application without going into the substance of the matter and to hold the application inadmissible.
The applicants in their observations lodged on 24 February 1970 requested the Court to hold the application admissible and to fix new time-limits for continuing the proceedings with regard to the substance of the case.
On hearing the report of the Judge-Rapporteur and the views of the Advocate-General, the Court decided to open the oral procedure without a preparatory inquiry on the preliminary objection; the Commission at the request of the Court lodged certain documents and replied to a question.
The parties presented oral argument on the preliminary objection at the hearing on 22 April 1970.
The Advocate-General delivered his opinion on the preliminary objection at the hearing on 14 May 1970.
III — Submissions and arguments of the parties on the admissibility of the application
The submissions and arguments put forward by the parties concerning the admissibility of the application may be summarized as follows:
A — The period within which the application should be made
The Commission points out that the contested decision was taken on 12 May 1969 and notified to the Belgian Government on 13 May whilst the application was made only on 25 November 1969; it puts the question whether that date is not out of time in respect of the period fixed by the third paragraph of Article 173 of the EEC Treaty.
The Commission does not ignore the fact that time does not begin to run in respect of that period in a case where, like the present, the contested decision—like all decisions of refusal to grant a quota—has not been the subject of a publication, until the day when the applicant has been informed of it; however it doubts whether the applicant companies only knew of the contested decision on 7 October 1969, as they maintain.
It appears permissible to the Commission to wonder whether there would not be grounds for requiring the applicants to have proved more diligent in obtaining either from the Commission or from their national authorities information concerning a measure which they considered gave them ground for complaint.
Without formally pleading the inadmissibility of the application, the Commission relies upon the wisdom of the Court on this point.
The applicants maintain that they heard of the contested decision only by a letter of 7 October 1969 from their trade association, the Union des Industries des Métaux non Ferreux, sending them a copy of the communication on this subject from the Minister for Economic Affairs of the Kingdom of Belgium dated 2 October 1969.
As 7 October 1969 is to be regarded as the starting point of the period laid down by Article 173, the objection concerning delay cannot be upheld.
Furthermore the applicants point out, on the one hand, that the principle of legal certainty relied upon by the Commission in support if its restrictive interpretation of the third paragraph of Article 173 must be reconciled with the principle of the right of those subject to Community law to act and, on the other hand, that all the previous decisions on the same subject had been published in the Official Journal of the Communities. The contested decision is, it is alleged, the only one not published and the Commission may not base its argument upon this in order to complain of a particular lack of diligence on the part of the applicants.
B — The conditions of admissibility under the second paragraph of Article 173
The Commission states that the disputed decision is not addressed to the applicant companies and that, in order to conform to the conditions of admissibility laid down by the second paragraph of Article 173 of the Treaty, they must establish that it is of direct and individual concern to them. Neither of these conditions is fulfilled in the present case.
The applicants, on the contrary, consider themselves to be directly and individually concerned by the contested decision.
1 — Is the contested decision of direct concern to the applicants?
The Commission maintains that an applicant is concerned directly by a Community decision only to the extent to which he can show that this decision affects the legal situation, the benefit of which he claims.
That is not the case if, for its realization, that legal situation presupposes the adoption of a measure of a Member State, in particular when such a measure depends upon the exercice of a national discretionary power.
a) It is not possible for decisions taken by the Commission under Protocol No XII to be of direct concern to private persons. The power of authorization which that protocol confers on the Commission concerns only its relationships with the Member States; it does not enable it to govern the legal situation of individuals. The ability of the latter to benefit from the opening of a tariff quota in respect of the product under considerations always presupposes a measure by a Member State; the direct link of causality required by the second paragraph of Article 173 of the Treaty can therefore never exist between decisions taken by the Commission on the basis of the aforementioned protocol and the legal situation of individuals.
b) In practice, the grant by the Commission of a tariff quota at reduced duties does not place any obligation upon the Member States concerned; it confers a mere power on them and leaves them free to open the quota authorized, not to bring it into force or to bring it into force only pratially. Only the national measures can have legal effects for individuals; consequently the latter are not directly concerned by the prior decision of the Commission.
c) The fact that the contested decision concerned a state of affairs which had expired at the time when it was taken is without importance as regards the evaluation of the admissibility of the application. In fact the Commission's decision, supposing that it had been positive, would have left its whole field to the exercise of the discretionary power of the Member States concerned, and a decision by them would have continued to be necessary in order for the legal situation of individuals to be settled. The effect of the grant of a. tariff quota could only have been to authorize the Member States in question to. repay a part of the customs duty which they had collected at the base rates of the Common Customs Tariff on imports which would have been admissible under the national tariff quota laid down in Protocol No XII. Further, it would have been necessary for the provisions of the national law of the Member States concerned to allow it and, above all, for the Member States to have agreed to make such repayment; further, it would have been for them to lay down the procedure and to decide the recipients. Thus a decision by the Commission to make a grant would have left the discretionary power of the Member States untouched in that respect. It would not thus have been of direct concern to individuals, in respect of whom its legal effects would necessarily have been the subject of intervening action by a national legal measure.
d) The fact that in the present case the contested decision refuses the quota requested does not lead to a different result in respect of the decision on the criterion of a direct interest. Even in the case of refusal, the decision is taken by the Commission in the exercise of a power which gives it the ability neither to determine directly the legal situation of individuals, nor to confer rights upon them. The benefit of the tariff quota at a reduced duty never constitutes a right for individuals at the time when the Commission comes to a decision concerning the request of the State, but merely a possible advantage, an uncertain possibility of a right, so that even in case of refusal individuals are not directly concerned by the decision of the Commission. To the extent to which the Commission impairs the discretionary power of a Member State by a decision of refusal, it does not appear to conform to the system of the Treaty that individuals should be able to substitute themselves for the State concerned in defending this discretionary power.
e) It is not logical from the point of view of litigation to treat decisions of refusal differently according to whether they are express or implied. It is however to this result that the argument accepting the possibility of a direct interest by individuals in the contested decision leads. In fact, even if the possibility of their being permitted to request the annulment of the Commission's express refusal of the request for a quota were to be recognized, there would be no doubt that if the Commission had refrained from deciding upon that request the applicants would not have had any method of appealing to the Court against such abstention: the decisions of the Commission in application of Protocol No XII are clearly not numbered among those concerning which the third paragraph of Article 175 gives individuals the right to bring an action for failure to act.
f) For all these reasons, the Commission considers that the contested decision is not of direct concern to the applicants. The applicants state that the restrictive argument of the Commission leads to two propositions, neither of which can be accepted: there is no direct interest unless the decision is applicable directly to the individuals and, in order to decide whether there is in this sense a direct interest, it is necessary'to pay particular attention to the nature of the power in question.
a) The Commission is wrong in regarding as decisions which are of ‘direct concern’ to private persons only those which are directly applicable to them. In fact an applicant is directly concerned by a Community decision if it has an effect on his situation and if that effect does not depend on the free appraisal of the Member State in question.
b) The existence of an area of discretion left to the Member State must be regarded not in the abstract but in practical terms. As it is a question of an authorization preceding the measure of the State, there is an area of discretion only in theory; in fact, every time the Belgian State asked for and obtained a tariff quota for unwrought aluminium it was opened. Furthermore, the requests made by the Belgian State always resulted, in respect of the tonnages requested, in an inquiry by the trade organization from the companies concerned. The Member State concerned in fact uses the authorization which is granted to it not after it has been granted, but before, when it formulates the request, so that the decision of the Commission, although it is a mere authorization has direct effects upon the situation of individuals. The contested decision, considered merely from the point of view of the implementation of the power of authorization, thus directly concerns the applicants.
c) In the present case the contested decision is, furthermore, a decision of refusal and not of authorization. In the case of refusal of authorization there is no longer even in theory an area of discretion for the Member State in question: the refusal obliges it to collect the entry duties for the unwrought aluminium at the rate of 9 %, the base rate of the Common Customs Tariff, and not at the rate of 5 %, the reduced rate of the national tariff quota. A decision of refusal, excluding any discretionary power on the part of Member State, thus concerns individuals directly.
d) By maintaining that the benefit of a tariff quota at a reduced duty amounts merely to a possible advantage for the individual at the time when the Commission makes a decision upon the request of a State, the defendant substitutes for its criterion of direct interest—the theoretical are of discretion of the State addressed—a new criterion, that is to say, the right which individuals may or may not have to the benefit of a tariff quota at a reduced duty; exchanging one criterion for another just as the need arises cannot be justified. That argument has also the consequence of making the infringement of a right a condition of the admissibility of applications by individuals, whilst it is sufficient that there should be infringement of an interest. In any case individuals have at least the right to require that decisions made in respect of tariff quotas are made legally, particularly in respect of the conditions required by Protocol No XII.
e) To the argument that it is hardly consistent to consider decisions of refusal, from the point of view of litigation, differently according to whether they are implied or express, the applicants reply that an action for failure to act and an application for annulment have different objects. Furthermore, the second paragraph of Article 173 authorizes private persons, at least in certain cases, to make an application for annulment against decisions addressed to Member States, whilst an action for failure to act against the Commission which has refrained from addressing a decision to a Member State may be excluded by the third paragraph of Article 175; one cannot therefore use the latter provision to interpret the second paragraph of Article 173. Lastly, reasoning by analogy which would have the effect of limiting the right of appeal of those subject to Community law beyond what is clearly laid down by the wording of the second paragraph of Article 173 cannot be admitted.
f) Finally, the applicants consider that they fulfil the first condition of admissibility in the second paragraph of Article 173: the concept of ‘direct concern’ must be understood in a concrete situation and not in an abstract manner and the present case concerns a decision of refusal which, in fact as well as in law, binds the State to which it is addressed and deprives it of any discretionary power.
2 — Is the contested decision of individual concern to the applicants?
The Commission, basing its argument on the case-law of the Court, maintains that persons other than the addressees of a decision cannot claim to be individually concerned unless that decision affects them by reason of certain attributes which are peculiar to them or by reason of circumstances in which they are differentiated from all other persons, and by virtue of these factors distinguishes them individually just as in the case of the person addressed.
a) The fact that they are aluminium importing and processing industries does not suffice to allow the applicants to be regarded as individually concerned by the contested decision.
b) It may without doubt be admitted that because of its date the contested decision could have had hardly any effect, if it had been positive, other than to authorize Belgium and Luxembourg to make certain repayments of customs duties within the limit of the quota agreed to and to regard persons concerned as being among those who in 1968 made imports of unwrought aluminium into Belgium and Luxembourg from third countries with the intention of processing that aluminium in the importing Member State after Belgium or Luxembourg had exhausted their capacity to draw upon the Community tariff quota opened in 1968 for the same product by the decision of the Council of 29 February 1968. Not only do the applicants put forward no evidence to show that they are actually in that position, but also these considerations do not suffice to establish that the number and the identity of the persons considered could have been determined at the time when the contested decision was adopted. In fact the Commission was not in a position to know at the time of its decision the importers which could have benefited from a repayment of customs duties if its decision had been positive: it was open to the Member States concerned to refrain from making such repayments or to do so only partially; but even if they had made full use of the authorization granted, it was possible that the amount of imports or unwrought aluminium actually made beyond the quota in 1968 would have been greater than the size of the quota laid down by the Commission. It was thus for Belgium and for Luxembourg to decide within the conditions laid down by their national law upon the method of apportionment of the quota among those concerned.
c) The applicants could not have found themselves in circumstances in which they were differentiated from all other persons and distinguished individually just as in the case of the person addressed; the contested decision is not therefore of individual concern to them within the meaning of the second paragraph of Article 173 of the Treaty.
The applicants state that, according to the opinion of the Commission itself, in order to establish that they are individually concerned by the contested decision, it suffices for them to show that in their capacity as importers they have actually imported unwrought aluminium from third countries, for the purpose of the processing of that aluminium in Belgium or Luxembourg, during the fourth quarter of 1968 (Belgium and Luxembourg having at that time exhausted their capacity to draw upon the Community tariff quota). The importers fulfilling these conditions are in fact the only persons concerned by the contested decision to the exclusion of all other persons.
a) According to the applicants, because of the date of the contested decision and of its exclusively retroactive effects, the number and identity of those importers, including the applicants, were clearly determined and capable of verification before the date on which the Commission adopted its decision. Those importers were affected by the contested decision because of a particular completed activity which at the time when the decision was taken could not have been carried out by another person.
b) The argument put forward by the Commission with regard to the determination of persons capable of benefiting from a repayment of customs duties on the supposition that its decision had been positive is superfluous and irrelevant. In fact the present case concerns not a positive decision, but a decision of refusal which affects all the importers including the applicants who found themselves in an objectively determined situation. It is thus pointless to try to discover what would have happened if the decision had been other than it was. Even if it is admitted that importers finding themselves in the position of the applicants would in case of a positive decision have had only a possibility of obtaining repayment of overpaid duties, nevertheless the said importers, and they alone to the exclusion of all others, were deprived of that possibility by the Commission's decision of refusal.
c) The views of the Commission are not, furthermore, founded on fact. In the event of a positive decision by the Commission the Belgian State would have had the power to repay overpaid duties; that is, moreover, a normal procedure, as numerous tariff quotas are granted only after considerable delay and their effects are thus limited to repayment of duties. Further, the Belgian State was not, contrary to the presumption of the Commission, confronted with a problem of distribution. In fact the quantities of imports of unwrought aluminium actually made over and above the Community quota in 1968 were not greater than the national quota provided for once temporary imports free of duty are deducted from it, as they must be. If the Commission had granted the national tariff quota requested, all imports from third countries liable to pay a duty on entry would have been covered by the quota granted and no question of distribution of repayment would have been raised, the overpaid duties being capable of complete repayment to all.
d) The applicants therefore consider themselves to be individually concerned by the contested decision.
Grounds of judgment
1. By an application lodged on 25 November 1969, the applicant companies have requested the annulment of a decision of the Commission, dated 12 May 1969, which refused to allow the Kingdom of Belgium and the Grand Duchy of Luxembourg to open for the year 1968 a tariff quota for unwrought aluminium under heading 76.01 A of the Common Customs Tariff.
2. The Commission has requested the Court, under Article 91 of the Rules of Procedure, to rule on the admissibility of this application, without examining the substance of the case, contending that the applicants lacked the locus standi to make the application in view of the conditions for admissibility laid down by the second paragraph of Article 173 of the Treaty and also alleging, in the alternative, that the application was out of time.
3. Under the second paragraph of Article 173 of the Treaty, any natural or legal person may, under the conditions set out in the first paragraph of that article, institute proceedings against a decision addressed to that person or against a decision which, although in the form of a regulation or a decision addressed to another person, is of direct and individual concern to the former.
4. The aim of this provision is to ensure the legal protection of individuals in all cases in which they are directly and individually concerned by a Community measure—in whatever form it appears—which is not addressed to them.
5. In these circumstances, it is necessary to consider whether the decision of 12 May 1969, which is the subject-matter of the present case, is of direct and individual concern to the applicants, although it is addressed to the Kingdom of Belgium and the Grand Duchy of Luxembourg.
6. The contested decision was taken within the framework of the powers conferred on the Commission by Protocol No XII on unwrought aluminium, annexed to the Agreement of 2 March 1960 on the establishment of a part of the Common Customs Tariff relating to products in ‘List G’.
7. Under this protocol and subject to the conditions therein prescribed, ‘the Commission shall authorize… the Benelux countries on their request to open annual tariff quotas subject to a duty of 5 % to cover the import needs of their processing industries…’.
8. A decision taken by the Commission, in pursuance of the provision quoted above, has thus no effect other than to create a power in favour of the Member States concerned, and does not confer any rights on possible beneficiaries of any measures to be taken subsequently by the said States.
9. It appears consequently that the grant, under Protocol No XII, of a tariff quota carrying a reduced rate of duty in favour of the Kingdom of Belgium and the Grand Duchy of Luxembourg would not have the effect of directly concerning undertakings which might have benefited from the award thus made.
10. However, the applicants point out that the contested decision is a negative decision and not one granting an authorization.
11. Consequently the decision is, it is alleged, of direct concern to them since it deprives them of any possibility of enjoying a reduced rate of duty under a tariff quota.
12. Furthermore, it is alleged that, as the decision was taken after the end of the financial year to which it referred, the identity of the importers who might have benefited from the said quota was definitively established, so that the decision rejecting the said request is of individual concern to the importers.
13. The annulment of the decision of 12 May 1969 cannot confer on the applicants the benefits which they seek, as such benefits can result only from the opening of tariff quotas by national authorities after an authorization granted by the Commission to the Member State concerned.
14. It appears therefore that the application aims in fact at requiring the Commission to adopt a measure, the effects of which, under Protocol No XII, can affect only the Member States.
15. The decision rejecting the request does not therefore concern the applicants in any other manner than would the positive decision which they wish to obtain.
16. It follows that the application must be dismissed as inadmissible, as the applicants have been unable to establish that they are concerned within the meaning of the second paragraph of Article 173.
17. In these circumstances, there is no need to consider the question whether the application has been brought within the prescribed period.
Costs
18. Under Article 69 (2) of the Rules of Procedure, the unsuccessful party shall be ordered to pay the costs.
19. The application has been held to be inadmissible.
20. The applicants must therefore be ordered to pay the costs.
On those grounds, Upon reading the pleadings; Upon hearing the report of the Judge-Rapporteur; Upon hearing the parties on the preliminary objection ; Upon hearing the opinion of the Advocate-General on the preliminary objection; Having regard to the Treaty establishing the European Economic Community especially Article 173; Having regard to the Protocol on the Statute of the Court of Justice of the European Economic Community; Having regard to the Rules of Procedure of the Court of Justice of the European Communities, especially Articles 69 and 91, THE COURT hereby :
1 Dismisses the application as inadmissible;
2 Orders the applicants to pay the costs.