Report for the Hearing delivered in Joined Cases 97, 193, 99 and 215/86

I — Facts

1. Council Regulation No 1152/78 of 30 May 1978 (Official Journal 1978 L 144, p. 1), amending Council Regulation No 516/77 of 14 March 1977 (Official Journal 1977 L 73, p. 1) on the common organization of the market in products processed from fruit and vegetables, established a system of production aid for certain products of particular importance in the Mediterranean regions, including tomato concentrates. The aid is intended to make up the difference between the level of prices of Community products, calculated on the basis mainly of a minimum price to be paid to tomato producers, set by the Commission before each marketing year, and of production costs, and the level of prices of products from nonmember countries.

2. Articles 58 and 59 of the Act of Accession of Greece to the European Communities (Official Journal 1979 L 291, p. 17) provide for the gradual alignment of Greek agricultural prices with the common prices. For products processed from tomatoes, falling under Regulation No 516/77, Article 59 (2) provides for the alignment of prices in seven stages. According to paragraphs (1) and (2) of Article 103, on the application in Greece of the aid systems laid down in Regulation No 516/77, the minimum price applicable in Greece is to be aligned with the common price in accordance with the detailed rules laid down in Article 59. Under Article 103 (3) the amount of Community aid granted in Greece is to be fixed in such a fashion as to compensate for the difference between the level of prices of products of third countries and the level of prices of Greek products established taking into account the minimum price and the processing costs obtaining in Greece.

3. For each marketing year the Commission, under the management committee procedure, adopted a regulation setting minimum prices payable to producers and amounts of production aid for Greece and for the other Member States: 1981/82 marketing year: Regulation No 1963/81 of 10 July 1981 (Official Journal 1981, L 192, p. 16); 1982/83 marketing year: Regulation No 1585/82 of 21 June 1982 (Official Journal 1982, L 178, p. 20); 1983/84 marketing year: Regulation No 1618/83 of 15 June 1983 (Official Journal 1983, L 159, p. 52); 1984/85, 1985/86 and 1986/87 marketing years: Regulation No 1709/84 of 19 June 1984 (Official Journal 1984, L 162, p. 8).

4. Production aid is fixed per 100 kg of tomato concentrate with a specific dry weight content packed in containers of a specific weight. In order to take into account differences in concentration and in packaging inter alia the Commission adopted for each marketing year a regulation setting coefficients to be applied to the amount of production aid for tomato concentrates : 1981/82 marketing year: Regulation No 1962/81 of 10 July 1981 (Official Journal 1981, L 192, p. 13); 1982/83 marketing year: Regulation No 1602/82 of 22 June 1982 (Official Journal 1982, L 179, p. 16); 1983/84 marketing year: Regulation No 1615/83 of 15 June 1983 (Official Journal 1983, L 159, p. 48); 1984/85, 1985/86 and 1986/87 marketing years: Regulation No 1709/84 of 19 June 1984 (Official Journal 1984, L 162, p. 8). An annex to each of these regulations fixes coefficients or percentages to be applied to the amount of aid according to the dry weight content and to sizes of containers smaller than a standard container.

5. An action for the annulment of Regulation No 1962/81 brought by a number of Greek producers, who argued that the system of uniform coefficients was discriminatory inasmuch as it did not compensate for processing costs for packagings smaller than the standard packaging, which were higher in Greece than in the other Member States, was dismissed as inadmissible by the judgment of the Court of 7 October 1982 (Case 250/81 Greek Canners v Commission [1982] ECR 3535) on the ground that the regulation was exclusively legislative in nature and, although it might affect the applicants, was not of direct and individual concern to them within the meaning of Article 173 of the EEC Treaty.

6. By its judgment of 19 September 1985 in an action brought by the Hellenic Republic (Case 192/83 Greece v Commission [1985] ECR 2791), the Court annulled Regulation No 1615/83 fixing the coefficients to be applied to production aid for tomato concentrates ‘in so far as the coefficients fixed in that regulation give rise to unequal treatment as between the Hellenic Republic and the other Member States as regards compensation for the extra costs incurred as a result of the use of packaging smaller than the standard packaging adopted by Article 1 (2) of Commission Regulation No 1618/83 of 15 June 1983 fixing for the 1983/84 marketing year the minimum price to be paid to producers and the amount of production aid for certain products processed from fruit and vegetables.’ In the last paragraph of that judgment the Court stated that it was the Commission's duty under Article 176 of the EEC Treaty ‘to fix new coefficients for Greece, or to devise some other system of compensation taking account of the fact that the aid scheme differentiates between Greece and the other Member States’.

7. An action for damages under Article 178 and the second paragraph of Article 215 of the EEC Treaty brought by applicants (1) to (13) in Cases 97/86 and 193/86 was dismissed by the judgment of the Court of 19 September 1985 (Joined Cases 194 to 206/83 As teris and Others v Commission [1985] ECR 2815) on the ground that the illegality of the coefficient system (according to the judgment of the Court in Case 192/83) could not ‘be regarded as constituting a serious breach of a superior rule of law or as manifest and grave disregard by the Commission of the limits on its power’ so as to give rise to liability on the part of the Community.

8. The Commission considered that in Case 192/83 the Court had declared Regulation No 1615/83 void in so far as the coefficients fixed in that regulation gave rise to unequal treatment as between Greece and the other Member States concerning compensation for the extra costs incurred as a result of the use of packagings smaller than the standard packaging; it therefore adopted Regulation No 381/86 of 20 February 1986 on additional payment of production aid for certain sizes of packagings with tomato concentrates obtained from Greek tomatoes during the 1983/84 marketing year (Official Journal 1986, L 44, p. 16). The regulations fixing the coefficients for the previous and subsequent marketing years were not amended.

9. By a letter of 10 April 1986 applicants (1) to (15) in Cases 97/86 and 193/86 asked the Commission to adopt, in accordance with the judgments of 19 September 1985, the necessary measure in order to fix additional aid for Greek processors for small packagings in respect of the 1981/82, 1982/83, 1984/85 and 1986/87 marketing years.

10. In its reply dated 11 June 1986 the Commission took the view that the judgment in Case 192/83 annulling Regulation No 1615/83 required it only to adopt a new regulation for the 1983/84 marketing year, which it had done by adopting Regulation No 381/86.

11. By a letter of 17 April 1986 which was forwarded to the Commission under cover of a letter of its Permanent Representation dated 23 April, the Hellenic Republic called upon the Commission to adopt the necessary measure in order to fix the supplementary aid payable to Greek manufacturers of tomato concentrate for concentrates packed in small containers and processed from tomatoes produced in Greece during the 1981/82, 1982/83, 1983/84, 1984/85, 1985/86 and 1986/87 marketing years in order to redress the injustice suffered by them because of the ‘technical errors’ committed by the Commission in adopting the corresponding regulations, which gave rise to unequal treatment to their detriment.

12. In its reply dated 19 June 1986, the Commission took the view that the judgment of 19 September 1985 in Case 192/83 entailed the obligation for it to adopt a new regulation concerning only the 1983/84 marketing year, to take the place of the annulled regulation, Regulation No 1615/83. By adopting Regulation No 381/86 it had complied with that judgment.

II — Written procedure and conclusions of the parties

1. By an application lodged in Case 97/86 at the Court Registry on 14 April 1986 the companies listed above under Nos 1 to 15 brought an action for the annulment of Regulation No 381/86 and of the Commission's refusal to comply in full with the judgments of 19 September 1985.

2. The applicants claim that the Court should: Declare the action admissible; Annul Regulation (EEC) No 381/86 in so far as the Commission restricts the supplementary payment of aid to the 1983/84 marketing year; Order the Commission to comply with the judgments of the Court in Case 192/83 and Joined Cases 194 to 206/83 and provide for the supplementary payment of production aid for tomato concentrates processed from Greek tomatoes for the 1981/82, 1982/83, 1984/85, 1985/86 and 1986/87 marketing years, in order to put an end to the unequal treatment suffered by Greek tomato concentrate producers as a result of the application of the system of coefficients established by the regulations referred to in the summary of the facts; Order the Commission to pay the costs.

3. The Commission, the defendant, submits that the Court should: Dismiss the action as inadmissible or, in the alternative, as without legal foundation; Order the applicants to pay the costs.

4. By an application lodged in Case 99/86 at the Court Registry on 21 April 1986 the Hellenic Republic brought an action for the annulment of Commission Regulation No 381/86 and of the Commission's refusal to comply in full with the judgments of 19 September 1985.

5. The Hellenic Republic claims that the Court should: Declare the action admissible; Annul Regulation No 381/86 of 20 February 1986 in so far as the Commission restricted the fixing of additional aid solely to the 1983/84 marketing year; Order the Commission to comply with the judgments of the Court in Case 192/83 and Joined Cases 194 to 206/83 and fix the supplementary aid payable for the production of tomato concentrates from Greek tomatoes for the 1981/82, 1982/83, 1984/85 and 1985/86 marketing years, so as to eliminate the unequal treatment to the detriment of the Hellenic Republic resulting from the system of coefficients established by the regulations referred to in the application; Order the Commission to pay the costs.

6. The Commission, defendant, submits that the Court should: Dismiss the application; Order the applicants to pay the costs.

7. By an application lodged in Case 193/86 at the Court Registry on 29 July 1986 the companies listed above under Nos 1 to 15 brought an action for the annulment of the position taken by the Commission in its letter of 11 June 1986 and its refusal, expressed in that letter, to comply with the judgments of the Court of 19 September 1985.

8. The applicants claim that the Court should: Declare the action admissible; Annul the position taken by the Commission in document JUR (86) D 3409 of 11 June 1986, to the effect that the Commission's obligation under the judgments of the Court referred to in the application is restricted to fixing supplementary aid for tomato concentrates processed from Greek tomatoes during the 1983/84 marketing year alone; Order the Commission to comply fully with the judgments of the Court of 19 September 1985 (in Case 192/83 and Joined Cases 194 to 206/83) and fix the supplementary aid payable for the production of tomato concentrate from Greek tomatoes for the 1981/82, 1982/83, 1984/85, 1985/86 and 1986/87 marketing years, so as to eliminate the unequal treatment to the detriment of Greek producers of tomato concentrates resulting from the system of coefficients established by Commission Regulations Nos 1962/81, 1602/82 and 1709/84; Order the Commission to pay the costs.

9. The Commission, defendant, submits that the Court should: Dismiss the application as inadmissible or in the alternative, as unfounded; Order the applicants to pay the costs.

10. By an application lodged in Case 215/86 at the Court Registry on 6 August 1986 the Hellenic Republic brought an action for the annulment of the position taken by the Commission in its letter of 19 June 1986 and of its refusal, expressed in that letter, to comply with the judgments of the Court of 19 September 1985.

11. The Hellenic Republic claims that the Court should: Declare the action admissible; Annul the position taken by the Commission in Document JUR (86) D 3551 of 19 June 1986, to the effect that the Commission's obligation under the judgments of the Court referred to in the application is restricted to fixing supplementary aid for tomato concentrates processed from Greek tomatoes during the 1983/84 marketing year alone; Order the Commission to comply fully with the judgments of the Court of 19 September 1985 (in Case 192/83 and Joined Cases 194 to 206/83) and fix the additional aid payable for the production of tomato concentrates from Greek tomatoes for the 1981/82, 1982/83, 1984/84, 1985/86 and 1986/87 marketing years, so as to eliminate the unequal treatment to the detriment of Greek producers of tomato concentrates resulting from the system of coefficients established by Commission Regulations Nos 1962/81, 1602/82 and 1709/84; Order the Commission to pay the costs.

12. The Commission, defendant, submits that the Court should: Dismiss the action as inadmissible or, in the alternative, as unfounded; Order the Hellenic Republic to pay the costs.

13. By an order of 17 June 1987 the Court decided to join Cases 97/86, 193/86, 99/86 and 215/86 for the purposes of the oral procedure and of the judgment.

14. Upon hearing the Report of the Judge-Rapporteur and the views of the Advocate General, the Court decided to open the oral procedure without ordering any preparatory inquiries.

III — Submissions and arguments of the parties

A — Admissibility

1. The Commission submits that the applications in Cases 97, 193 and 215/86 are inadmissible. With regard to the application in Case 97/86, it argues that Regulation No 381/86 has all the characteristics of a regulation and is not a disguised decision adopted in order to satisfy the applicant's request, which would thus concern them directly and individually. The contested measure does not cease to be a regulation because it applies to undertakings, which are moreover unidentified, in a specific Member State, or because it was adopted in order to implement a judgment of the Court. In its judgment of 7 October 1982 (Case 250/81, referred to above), the Court has already held inadmissible an action for the annulment of Regulation No 1962/81, similar to the measure now contested, on the ground that it was exclusively legislative in nature and, although it might affect the applicants, was not of direct and individual concern to them. The applicants regard Cases 193/86 and 215/86 as actions for failure to act under the third paragraph of Article 175 of the EEC Treaty. An action for failure to act is admissible only where the Commission has been called upon to address to the applicants a measure other than a recommendation or an opinion and has not defined its position within a certain period. As the Court has held, an institution defines its position where it refuses to act or adopts a measure different from that requested by the person concerned or one constituting the execution of an obligation under the Treaty. With regard to the action brought by the applicant undertakings in Case 193/86, the refusal contained in the letter of 11 June 1986 constituted the adoption of a position subject to review by the Court in the framework of Case 97/86, on the claim for the annulment of Regulation No 381/86. Similarly, in the action brought by the Hellenic Republic in Case 215/86, the Commission took a position in its letter of 19 June 1986 which is subject to review by the Court in Case 99/86.

2. The applicants in the three cases argue that their actions are admissible. The applicants in Case 97/86 submit that the action is admissible; any natural or legal person is entitled to bring an action for the annulment of an act of a Community institution which is in substance a decision. That is the case where the act is addressed to a limited number of persons, defined or identifiable, even if it is officially called a regulation, where it concerns the applicants directly in the sense that the Member State authorities do not enjoy any discretion in the implementation of the Community measure and where it concerns them individually by reason of certain attributes which are peculiar to them or of circumstances which differentiate them from all other persons and distinguish them individually just as in the case of the person addressed. Regulation No 381/86 applies only to Greek producers of tomato concentrates and thus concerns them directly and individually. It may be regarded as a bundle of individual decisions which could have been taken on the basis of the production data of each of the applicants, data of which the Commission was aware and which show the actual amount of the supplementary aid for each of the applicants. Moreover, the Greek authorities had no discretion in the application of the regulation in question. The applicants in Case 193/86 state that that action was brought only in the alternative, in the event that the action in Case 97/86 should be held inadmissible on the ground that its true purpose was not the annulment of Regulation No 381/86 but the condemnation of the Commission's refusal to comply with the judgments of 19 September 1985, and should therefore have been commenced in accordance with the preliminary procedure laid down in the second paragraph of Article 175 of the EEC Treaty. To that end the applicants called on the Commission on 10 April 1986 to fix the supplementary aid to be paid to the Greek undertakings, and in these proceedings it contests the negative position taken by the Commission on 11 June 1986.

3. The Hellenic Republic submits that the action in Case 215/86, which must moreover be viewed in the same context as the related action in Case 99/86, is admissible. The important point is not to what extent the Commission has defined its position in accordance with the second paragraph of Article 175 of the EEC Treaty but to what extent it is entitled, in so defining its position, to disregard the principle of equality which governs the Community legal system and the findings of the Court in its judgments of 19 September 1985. For an action based on Article 175 of the Treaty to be inadmissible it is not sufficient that the Commission should have adopted any position whatsoever. The position taken by the Community institution must be in accordance with the law and must in any event be subject to judicial review. That interpretation is confirmed by Article 35 of the ECSC Treaty, to which the Court may refer where the other Treaties are silent on the matter, under which an action for failure to act is treated in its final stages as an action for annulment.

B — Substance

1. The applicants in Cases 97/86 and 193/86 and the Hellenic Republic in Cases 99/86 and 215/86 argue that the Commission has infringed Article 40 (3) of the EEC Treaty, in particular the principle of equality contained therein, and Article 176 of the EEC Treaty. The second subparagraph of Article 40 (3) requires the Community, in the context of the common organization of the markets, to exclude any discrimination between producers or consumers within the Community. That rule of primary law enshrines in Community law the overriding principle of equal treatment, a fundamental principle of any national or international legal system. That principle concerns not only the equality of citizens under secondary Community law but also equality in the rules of such secondary law as applied to Member States and their citizens. Once the Court has held that a rule of secondary Community law is contrary to the principle of equal treatment, the competent Community institution is legally obliged to eliminate that inequality. In its judgments of 19 September 1985 the Court held that the Commission had infringed the principle of equal treatment, not only in respect of the 1983/84 marketing year but also in respect of the previous and subsequent marketing years; the Commission should therefore have eliminated the unequal treatment in respect of all the marketing years concerned. The judgment of 19 September 1985 in Case 192/83 required the Commission, by virtue of Article 176 of the EEC Treaty, to fix, in respect of Greece, new coefficients or any other system of compensation taking into account the differentiation in the aid scheme between Greece and the other Member States in respect, naturally, of the 1983/84 marketing year, but also in respect of the other marketing years concerned. The Commission cannot restrict the binding force of the judgment in Case 192/83 to the operative part of the judgment concerning the regulation in respect of the 1983/84 marketing year and ignore the reasons for judgment. The point of view adopted by the Commission amounts to accepting that the protection of Community nationals against illegal acts of the institutions can be ensured only by judgments of the Court and that the Commission, the guardian of Treaty rights, will act only within the limits of an express obligation laid down by the Court. The Court must decide to what extent a rule of secondary law which, according to a judgment of the Court, infringes the fundamental principle of equality can no longer be called in question for procedural reasons relating to the fact that only the regulation concerning a single marketing year (1983/84) was annulled and the claims for compensation were dismissed. The Commission cannot rely on the fact that the Hellenic Republic refrained from contesting all the regulations inasmuch as the Hellenic Republic and the applicant undertakings were entitled to take the view that the judgment of the Court concerning one marketing year bound the Commission, in so far as the same legal issue was at stake, in respect of the regulations concerning the previous and subsequent marketing years. These actions are not claims for compensation but are intended to require the Commission to offset the production costs of Greek producers and to eliminate the effects of the aid system adopted by the Commission which has been held by the Court to be illegal, in respect of all the marketing years in which those effects made themselves felt.

2. The Commission argues in all these cases that the actions are without foundation and that it correctly implemented the judgments of 19 September 1985. The judgment delivered in Case 192/83 required it to adopt a new regulation solely for the 1983/84 marketing year, to which the annulled regulation applied. The annulment by the Court of an act of a Community institution entails the obligation for that institution to replace that measure with another so as to eliminate the illegality held to exist, and the obligation to replace any measures based on the annulled measure. The regulations concerning the marketing years before and after 1983/84 are not based on the annulled regulation. Furthermore, the judgment delivered in Joined Cases 194 to 206/83 dismissed the actions for damages brought by certain of the undertakings who are applicants in Cases 97/86 and 193/86, which means that in respect of the 1981/82 and 1982/83 marketing years the Commission was not, in spite of the illegality of the corresponding regulations, under any obligation to correct the detrimental effects for the applicants of legislative measures against which no action for annulment had been brought. In respect of the subsequent marketing years, 1984/85, 1985/86 and 1986/87, the Commission adopted Regulation No 1709/84 of 19 June 1984 on minimum prices payable to producers and amounts of production aid for certain processed fruit and vegetables eligible for production aid (Official Journal 1984 L 162, p. 8). That regulation was applied, rightly, during the period before the delivery of judgment in Case 192/83. In respect of the period following that judgment, there may be grounds for the suggestion that the Commission was legally bound to amend the regulation in order to comply with the judgment. In that regard it should be pointed out first of all that the regulation was not contested within the period laid down in the third paragraph of Article 173 of the EEC Treaty, and its validity and application can therefore no longer be contested, even in respect of the period after 19 September 1985. Secondly, since the whole of the regulation could no longer be contested once the period for bringing proceedings had expired, the Commission cannot be legally required to amend it, even in respect of the period after the delivery of the judgments. That position is in harmony with the concept of the binding force of the judgment in Case 192/83. The question whether only the operative part of a judgment has binding force and not the reasons for judgment is resolved by the Court's judgments to the effect that a regulation is presumed valid until it is held invalid.

F. Schockweiler

Judge-Rapporteur

1 Language of the Case: Greek.