Report for the Hearing delivered in Case 390/85

I — Facts and procedure

1. On 5 March 1979 the Council adopted Directive 79/279/EEC coordinating the conditions for the admission of securities to stock exchange listing (Official Journal, L 66 of 16 March 1979, p. 21). Article 22 of that directive provides, firstly, that the Member States should take the measures necessary to comply with the directive within two years of its notification and, secondly, that they should inform the Commission thereof forthwith. On 17 March 1980 the Council adopted Directive 80/390/EEC coordinating the requirements for the drawing up, scrutiny and distribution of listing particulars to be published for the admission of securities to official stock exchange listing (Official Journal L 100 of 17 April 1980, p. 1). Article 27 of that directive provides, firstly, that the Member States should take the measures necessary to comply therewith within 30 months of its notification and, secondly, that they should inform the Commission thereof forthwith. On 15 February 1982 the Council adopted Directive 82/121/EEC on information to be published on a regular basis by companies the shares of which have been admitted to official stock exchange listing (Official Journal L 48 of 20 February 1982, p. 26). Article 12 of that directive provides that Member States should bring into force the measures necessary to comply therewith not later than 30 June 1983 and that they should inform the Commission thereof forthwith. However, in order that the Member States should not have to initiate several transposition procedures at very short intervals, the Council adopted Directive 82/148/EEC of 3 March 1982 (Official Journal L 62 of 5 March 1982, p. 22), under which the Member States were permitted to implement the three directives concurrently; Articles 1 and 2 of Directive 82/148/EEC extended the period for the implementation of the directives until 30 June 1983. Since it had not been informed by the Belgian Government of the measures taken to comply with the directives, the Commission concluded that transposition measures had not been adopted, and, by letter No SG (84) D/715 of 19 January 1984, it formally requested the Belgian Government, pursuant to Article 169 of the EEC Treaty, to submit its observations within a period of two months. By letter No C 12-96 of 28 March 1984 the Belgian Government replied that although the transposition of the directives into national law did not necessitate fundamental changes in national legislation it did entail the adoption of legislation and regulations with a view to bringing Belgian law fully into line with their provisions. To that end the Belgian Government had already submitted a bill to the Conseil d'État [State Council] and initiated the drafting of the requisite royal decrees. The Commission considered the Belgian Government's answer to be unsatisfactory and, on 16 April 1985, it delivered reasoned opinion No SG (84) D 4832, in which it asked the Belgian Government to take the requisite measures within two months of its notification. By letter No C 12.96 1412/95.492 of 24 May 1985 the Belgian Government informed the Commission once again that a preliminary draft law designed to transpose the three directives into national law was still before the legislation department of the Conseil d'État.

2. In view of the failure to adopt the transposition measures promised by the Belgian Government the Commission brought this action against the Belgian Government for failure to meet its obligations, which was received at the Court Registry on 12 December 1985. The written procedure followed its usual course; however, only an application and a defence were submitted to the Court since the Commission decided not to submit a reply. Upon hearing the Report of the Judge-Rapporteur and the views of the Advocate General the Court decided to open the oral procedure without any preparatory inquiry.

II — Conclusions of the parties

1. The Commission claims that the Court should: (i) Declare that, by failing to adopt the measures necessary to comply with the provisions of (a) Council Directive 79/279/EEC of 5 March 1979 coordinating the conditions for the admission of securities to official stock exchange listing, (b) Council Directive 80/390/EEC of 17 March 1980 coordinating the requirements for the drawing up, scrutiny and distribution of the listing particulars to be published for the admission of securities to official stock exchange listing, and (c) Council Directive 82/121/EEC of 15 February 1982 on information to be published on a regular basis by companies the shares of which have been admitted to official stock exchange listing, ; the Kingdom of Belgium has failed to fulfil its obligations under the EEC Treaty; (ii) Order the Kingdom of Belgium to pay the costs.

2. The Government of the Kingdom of Belgium has not submitted formal conclusions to the Court.

III — Submissions and arguments of the parties

1. The Commission stresses that directives are binding as to the result to be achieved upon the Member States to which they are addressed under the third paragraph of Article 189 and the first paragraph of Article 5 of the EEC Treaty, which provides that the Member States are to take all appropriate measures to ensure fulfilment of the obligations arising out of the Treaty or resulting from action taken by the institutions of the Community. It further refers to the Court's case-law according to which, as a result of the aforesaid anieles of the Treaty, Member States to which directives are addressed are under an obligation to bring their legislation into line with them within the time-limits laid down therein and may not plead provisions, practices or circumstances existing in their internal legal systems in order to justify failures to comply with obligations and time-limits resulting from Community directives. It maintains that since it is uncontested and uncontestable that the Kingdom of Belgium has not adopted the necessary measures to comply therewith it has failed to fulfil its obligations under Directives 79/279/EEC, 80/390/EEC and 82/121/EEC.

2. The Belgian Government does not contest that measures to transpose the three directives into its national legal order have not yet been adopted and merely describes the difficulties experienced in adapting its national legislation. Those difficulties are connected, on the one hand, with the directives themselves and, on the other, with their transposition into national law. (a) According to the Belgian Government, the difficulties due to the directives themselves have a threefold basis. Firstly, the three directives, which deal with the same area, that is to say with the admission of securities to stock exchange listing and the requirements to be met following such admission, laid down different obligations for the Member States on three occasions over a period of three years between the adoption of the first and the third directives. As a result, national rules had to be adopted on a piecemeal basis and it was in order to mitigate that difficulty that Directive 82/148/EEC of 3 March 1982 provided for an extension in the event of the simultaneous transposition into national law of the three directives. However, the additional time allowed was short in so far as the time for implementing Directive 79/279/EEC was extended from 8 March 1982 to 30 June 1983 and the time for implementing Directive 80/390/EEC from 19 September 1982 to 30 June 1983. Secondly, the Belgian Government maintains that, because of the minimum coordination effected in many respects by the three directives, the Member States had to consider whether supplementary requirements laid down by national law had to be retained or curtailed in order to conform with the rules laid down by the directives and decide whether or not to exercise the options provided for in the directives and whether they should go beyond the minimum rules laid down by the directives. The Member States also had to make their decisions in the light, not only of the national rules in existence prior to the adoption of the directives, but also of the progressive creation of a European capital market, the objective pursued by the directives. Lastly, the Belgian Government observes that the directives entail obligations on the part of issuers of securities both with a view to their admission to listing and following their admission to listing, in addition to the appointment by the Member States of competent authorities which are to be responsible for making sure that the provisions of the directives are complied with and are to have the powers necessary for that purpose. However, the Belgian Government maintains that, since the directives are vague and in certain cases silent, the Member States had to lay down sufficiently precise rules in order to safeguard the interests of issuers of securities and the effective organization of the role of the competent national authorities; in so doing they should not merely accept the directives' lack of precision and should take account not only of the preexisting national rules but also of the more general problems of the European capital market currently in the process of being established. (b) The Belgian Government refers to three areas of difficulty connected with the transposition of the directives into national law. In the first place, it explains that, having found that it was not possible to transpose the directives solely by means of regulations, it proceeded to draw up a bill and on 7 March 1984 it referred the matter to the Conseil d'État for its opinion. It is not yet in possession of that opinion, without which it cannot place the matter before the Parliament. Secondly, the Belgian Government mentions the need to consult several national authorities in view of their responsibilities in the field covered by the directives. Those authorities include the Banking Commission and the listing committees of the four Belgian stock exchanges. Furthermore it had to involve in its work not only the Minister for Finance, who is responsible for the measures implementing the transposition of the directives into national law, but also the Minister for Justice, in view, firstly, of the link between the publication of a prospectus before the admission of securities to listing, as required by Directive 80/390/EEC, and the publication of a notice as required by national legislation for the same purposes, which had to be abolished, and, secondly, of the connection between the requirement to publish matters and decisions likely to have a significant influence on stock exchange prices, as required by Directive 79/279/EEC, and the question of insider dealing, on which it was also necessary to legislate. Finally the Belgian Government refers to the complex drafting of the provisions concerning the functions and powers to be conferred on the competent national authorities, which necessitated the formulation of sufficiently precise rules in view of the lack of clarity of the Community directives in that regard. The fact that two national authorities (Banking Commission, Stock Exchange Committee) are involved when securities are admitted to listing and that the directives provide for numerous options, possible exceptions and possible stricter requirements did not facilitate the task of adapting the national rules in accordance with the directives. Finally, the Belgian Government expresses its intention of bringing into force at the same time as the law, which is subject to parliamentary approval, three royal implementing decrees whose drafting is at an advanced stage.

C. Kakouris

Judge-Rapporteur

1 Language of the Case: French.