Judgment of the Court 15 July 1970 Giberto Borromeo Arese and Others v Commission of the European Communities

In Case 6/70

THE COURT composed of: R. Lecourt (Rapporteur), President, R. Monaco and P. Pescatore, Presidents of Chambers, A. M. Donner and A. Trabucchi, Judges, Advocate-General: J. Gand Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

I — Summary of the facts

1. In November 1969 the Senate of the Italian Republic approved a draft law providing in particular that the amount of rents for agricultural land should be calculated by multiplying the basic land tax by coefficients to be laid down by a technical commission.

2. By letter of 5 November 1969 the applicants requested the defendant, under Article 175 of the EEC Treaty, to take action under Article 155 of the Treaty to ensure that the Italian State applied Articles 101 and 102 of the Treaty with regard to the procedure for drawing up the law in question; to submit to the Council a draft directive in application of Articles 155, 145 and 100 of the Treaty with a view to harmonizing agricultural leases in the Member States of the Community; to take a decision in respect of the applicants fixing the terms and detailed rules to be followed in practice on concluding leases of their agricultural property when the said draft law becomes an effective law of the Italian Republic. By letter of 22 December 1969 the Director-General for the Internal Market and Approximation of Legislation at the Commission informed the applicants that his departments were studying the content of the draft law in question but stated also that it would not be possible for the applicants to bring an action for failure to act before the Court.

3. On 27 February 1970 the applicants introduced this application.

4. By letter of 12 March 1970 sent to counsel for the applicants, the Vice-President of the Commission stated, ‘in order to avoid any misunderstanding’, that the letter of 22 December had clarified the attitude of the Commission as regards the applicants' request, so that they could not expect any other reply from the defendant.

II — Conclusions of the parties

The applicants in their application claim that the Court should:

after finding that Italy has infringed the rules contained in Articles 101 and 102 of the EEC Treaty and in the decision of the Council of the EEC of 4 December 1962, as regards the procedure followed in drawing up the national law, and Article 3 (d), the first paragraph of Article 31 and Articles 40 (2), 44, 46 and 92 of the EEC Treaty in respect of the content of the said law, declare that by failing to take the decision sought with regard to them the defendant Commission has infringed the third indent of Article 155 of the EEC Treaty;

order the defendant to pay the costs.

The defendant, in a statement in connexion with a procedural issue lodged on 26 April 1970, contends that the Court should:

give a preliminary ruling, without discussing the substance of the case, on the admissibility of the application under Article 91 of the Rules of Procedure;

declare the application to be inadmissible and consequently dismiss it;

order the applicants to pay the costs.

In a document lodged at the Registry on 12 May 1970 under Article 91 (2) of the Rules of Procedure the applicants stated that :

‘if the Court were to consider the interlocutory declaration [of the non-conformity to the Treaty of the draft law in dispute] unnecessary for the purpose of its decision and on the contrary to consider that the request is capable of leading to the inadmissibility of the application, the applicants amend their conclusions by withdrawing the request concerning the interlocutory declaration of an infringement by the Italian State of its obligations under the Treaty and restricting themselves to seeking a declaration that the Commission has infringed the third indent of Article 155 of the Treaty by reason of the fact that it failed to issue the decision sought in respect of the applicants’.

III — Procedure

1. By an application to intervene made on 8 May 1970, Livio Gilardi, a farmer residing at Palombaro Sabina (Province of Rome), stated that he supported the conclusions of the defendant. By order of 11 June 1970 the Court declared that application to be inadmissible.

2. After hearing the report of the Judge-Rapporteur and the views of the Advocate-General, the Court decided not to make a preparatory inquiry but to open the. oral procedure in connexion with the preliminary objection of inadmissibility raised by the defendant. The parties presented oral argument at the hearing on 1 July 1970. The Advocate-General delivered his opinion at the hearing on 7 July 1970.

IV — Submissions and arguments of the parties

In their application the applicants make the following points in particular:

They are the owners of agricultural land situated in the provinces of Milan and Pavia, which is leased.

This application is admissible; in fact, by their letter of 5 November 1969 the applicants in vain requested the Commission to take a concrete decision in respect of them.

The application is also well founded, for the following reasons in particular:

If the draft law in question were to attain the force of law, the applicants would be obliged to enter into contracts with their tenants in terms taking into account not the productivity of the agricultural land leased or the actual income arising from it but ‘values agreed for taxation purposes, reassessed on the basis of a fixed coefficient’. Contrary to what the position is in the other Member States, the rules envisaged ignore ‘the necessity for remunerating landed capital on the basis of its real nature in a free market system’. Because of this, the price of agricultural products obtained from the said properties is distorted, in defiance — as the applicants point out in detail — of a whole series of Community provisions.

The defendant is therefore obliged either to call upon the Italian State to adopt rules conforming to the EEC Treaty or to take a decision indicating to the applicants what course of conduct they must follow in order to observe both the national legislation and the Community rules.

The defendant, in its statement in connexion with the procedural issue, puts forward the following considerations in particular:

A declaration of the non-observance by a Member State of its Community obligations may only be made at the request of the Commission or of another Member State. Individuals do not have the capacity to seek such a declaration, even by means of an action for failure to act. The only remedy open to them for opposing the illegal measures of States is to raise such illegality before the national court, on condition of course that the Community provisions alleged to have been infringed are directly applicable within the meaning attributed to those words in the case-law of the Court.

There is no failure to act on the part of the defendant, as it defined its position in its letter of 22 December 1969.

There is no Community provision obliging the defendant to take the individual decision sought in respect of the applicants.

Finally, it is impossible at present to be aware of all the amendments which might be made to the draft law or to know how and when it will be promulgated.

In their statement lodged on 21 May 1970, the applicants replied in particular as follows:

They had supposed that in order to assess whether or not the defendant was obliged to indicate the course of conduct to be followed by the applicants when entering into leases the Court would logically be led to examine first of all whether or not the disputed draft law conformed to the Treaty.

In the event of this line of reasoning being erroneous, the applicants state that they amend their conclusions as indicated above under II at the end thereof.

The letter of 22 December 1969 does not constitute a definition of the Commission's attitude, or even a decision, but merely an interim reply. This interpretation is confirmed by the letter of 12 March 1970.

The defendant's duty to adopt the individual decision sought arises from Article 155 of the Treaty, which charges the Commission with the task of watching over the conduct of all those subject to Community law, both States and individuals.

Grounds of judgment

1. By application lodged on 27 February 1970, the applicants, who are the proprietors of agricultural land situated in Italy, instituted an action based on Article 175 of the EEC Treaty for a declaration that the defendant has infringed the Treaty by failing to address to them a decision which they had called upon it to take.

2. This decision would have involved fixing the detailed rules to be followed by the applicant for the wording of leases of their agricultural land when a draft law on the method of fixing the rents for agricultural land, which had been adopted by the Senate of the Italian Republic, had become law.

3. The defendant has requested the Court, under Article 91 of the Rules of Procedure, to decide on the admissibility of the application without discussing the substance of the case.

4. The applicants maintain that the decision sought is necessary in order to indicate to them the course of conduct which they should follow in order to observe both national legislation and Community rules.

5. Under the terms of the third paragraph of Article 175 of the Treaty any natural or legal person may, under the conditions laid down in the first and second paragraphs of that article, complain to the Court that an institution of the Community ‘has failed to address to that person any act other than a recommendation or an opinion’.

6. The applicants sought the Commission's advice on the course of conduct to be followed in the event of conflict between their national legislation and certain provisions of Community law.

7. Such a measure would be equivalent not to a decision but to an opinion within the meaning of the last paragraph of Article 189 of the Treaty.

8. Moreover, by adopting the measure sought the defendant would have been required first to assess whether the draft law in question conformed with the Treaty. This would therefore still have resulted in a measure other than those referred to in the third paragraph of Article 175.

9. The application must therefore be dismissed as inadmissible.

10. Under the terms of Article 69 (2) of the Rules of Procedure the unsuccessful party shall be ordered to pay the costs. The applicants have failed in their submissions.

On those grounds, Upon reading the pleadings; Upon hearing the report of the Judge-Rapporteur; Upon hearing the parties; Upon hearing the opinion of the Advocate-General; Having regard to the Treaty establishing the European Economic Community, especially Article 175; 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.

1 Language of the Case: Italian.

2 CMLR.