C-8/55

JUDGMENT OF 16.7.1956 — CASE 8/55

that factor into account. Additional information as to the estimated level of production costs for each category and type are necessary in order to give judgment in this instance (Convention on the Transitional Provisions, Art. 26).

In Case 8/55

FÉDÉRATION CHARBONNIÈRE DE BELGIQUE, represented by Louis Dehasse and Leon Canivet, assisted by Paul Tschoffen, Advocate at the Cour d'Appel, Liege, and by Henri Simont, Advocate at the Cour de Cassation of Belgium, Professor at the Free University of Brussels, with an address for service in Luxembourg at 6, Rue Henri Heine,

applicant,

v

gives the following

FÉDÉRATION CHARBONNIÈRE BELGIQUE V HIGH AUTHORITY

JUDGMENT

Facts

1955 under No 657. It was lodged within On the same date the Advocate General the period prescribed by the third para delivered his opinion, to the effect that the graph of Article 33 of the Treaty in con application should be dismissed and that junction with Articles 84 and 85 of the the costs should be borne by the applicant. Rules of Procedure of the Court of Justice. The powers of the applicant's representa 2. Conclusions of the parties tives are in order and their signatures have been verified as genuine. In its application, the applicant claims that The applicant's lawyers and the Agent and the Court should: lawyer of the defendant have been properly

The President of the Court Belgian Government and in the table of designated Mr van Kleffens to act as Judge- rates of equalization annexed to that letter Rapporteur and, in accordance with the fi in so far as: nal paragraph of Article 9 of the Rules of Procedure of the Court, designated Mr La (a) it leads to discrimination between pro grange to be Advocate General. ducers of identical types of coal; After hearing the views of the Advocate General, the Court decided, at the end of (b) it provides that in the future equaliza the written procedure, in accordance with tion payments will be or may be with the preliminary Report presented by the drawn from certain undertakings on the Judge-Rapporteur under Article 34 of the ground that they are not making the effort Rules of Procedure of the Court, to open to re-equip considered possible and neces the oral procedure without holding any sary or are refusing to carry out the trans preparatory inquiry. fers or exchanges of deposits which are re At the request or the parties the court de garded as indispensable for a better devel cided at the beginning of the oral proce opment of the mining areas; dure to deal with the present case together with Case 9/55, Société des Charbonnages (c) it fixes rates of equalization in accor de Beeringen, Société des Charbonnages dance with the new price list. nages de Houthalen and Société des Char bonnages de Helchteren el Zolder v High According to the application the action is Authority. based upon Articles 3 and 4, in particular The parties presented oral argument at the 4(b), 5, 33 and 57 of the Treaty of 18 April

1951, as well as on Articles 24, 25 and 26 price list provided for in Article 26 of the of the Convention on the Transitional Pro Convention and to determine the aids nec visions of the same date, and invokes lack essary as a result of the application of that of competence on the part of the High Au price list, that is, 29 francs per metric ton thority, infringement of the Treaty and of extracted, in addition to the so-called con the rules of law relating to its implementa ventional subsidies already granted to cer tion, manifest failure to observe the provi tain collieries by the Belgian Government. sions of the Treaty and misuse of powers, That result had been obtained by calculat all of which vitiate the contested decisions. ing the difference between the prices in a The defendant contends that the Court 'price list for accounting purposes', based should dismiss the application lodged by upon the receipts of the undertakings, and the Federation Charbonnière de Belgique those of a 'list of selling prices' at which the on 27 June 1955, with all the consequences collieries dispose of their products.

1953. That decision fixed the mode of as letter addressed to the Belgian Govern sessment and collection of the levy by ment on 22 October 1953 informing it of means of which the necessary funds were the new table of selling prices and the new to be otained in order to ensure the finan price list for accounting purposes (decision cing of the aid provided for to that end in and letter published in the Journal Officiel, the Convention on the Transitional Provi No 12, of 27 October 1953).

That de the Belgian coalfield to 'comply' with the cision fixed maximum prices for the sale of price list annexed to that decision, despite certain types of Belgian coal listed in an an the fact that it was identical to the list al nex to the decision. ready in force. On the same date the High Authority ad That decision was followed by a letter to dressed a letter to the Belgian Government the Belgian Government dated 20 March (published in the Journal Officiel, No 4, of 1954 (Journal Officiel, No 3, of 24 March 13 March 1953) in which it gave details of 1954) in which the High Authority in the aid which it proposed to grant to the formed it of its decision to prolong the ap Belgian collieries. It stated in the letter that plication of the existing price list. as a result of preparatory work which had After adding certain Belgian mines to those taken place it had been possible to fix the already listed in the annex to Decision No

15/54 as being entitled to make a quality As regards the question whether the deci surcharge (Decision No 27/54 of 12 May sions are general in nature, the defendant 1954, Journal Officiel, No 10, of 20 May maintains that a decision is general by rea 1954), the High Authority declared in De son of its nature as a regulation and of the cision No 15/55 of 28 April 1955 (Journal extent of its area of application; it does not Officiel, No 10, of 30 April 1955) that De

gian coal'. That table came into force on (b) If the Court does not share that opinion 16 June 1955. and considers that there is a misue of pow The aforementioned decision and letter ers 'affecting' an undertaking where the ac (published in the Journal Officiel, No 12, tion taken constitutes a direct prejudice to of 31 May 1955) form the subject-matter its interests, it is still necessary to specify of the present application. wherein the misuse of powers lies.

is individual in nature. There is no dispute It must therefore be made clear which of as to the admissibility of the application on the grounds of complaint put forward in that point and the decision in question the application fall outside the submission may be contested on all the grounds for of misuse of powers, which is the sole sub annulment. mission which the applicant is entitled to On the other hand, Decision No 22/55 is put forward. general in nature and may be contested only on the ground of misuse of powers af The applicant maintains that the price list, fecting the applicant. which forms part of Decision No 22/55, The foregoing applies to the letter of 28 and the rate of equalization, which forms May 1955 in so far as it makes the payment part of the letter of 28 May 1955, are indis of equalization conditional upon an ac

JUDGMENT OF 16.7.1956 — CASE 8/55

plication to be admissible, the applicant der to bring about changes in the structure must put forward a reasoned submission of of the Belgian coal mining industry. misuse of powers. The applicant agrees with the defendant By putting forward submissions based on that, in accordance with Articles 25 et seq., misuse of powers, lack of competence and the normal powers of the High Authority infringement of the Treaty, the applicant have been considerably extended. It does proposes to show that the contested mea not follow, however, that its sovereign sures are entirely vitiated by misuse of power to intervene is thereby also ex powers and that most of them are vitiated tended, since the purpose of Article 25 et by lack of competence or infringement of seq. is to place the Belgian industry in a the Treaty. more favourable situation than that which The applicant considers that if the Court results from the Treaty, in particular from regards the decisions in question as being Article 61. general in nature it must annul them on The High Authority claims that the objec grounds of misuse of powers, since evi tive of Article 26 cannot be achieved by the dence of the other vitiating factors sup free interplay of economic forces without ports the evidence of misuse of powers. any action on its part.

FÉDÉRATION CHARBONNIÈRE BELGIQUE V HIGH AUTHORITY

Conse (b) Power of the High Authority to fix quently, the High Authority is obliged to prices at a reduced level establish a working basis for the equaliza tion system and must itself decide on the The applicant maintains that, having re measures which are necessary for that pur gard to the aims of Article 26 (2), the High pose. It is on that ground that it considered Authority infringed that article and mis the fixing of prices to be necessary and in used its powers by adopting, in the present dispensable to the operation of the equal state of the market, Decision No 22/55,

The producers can organize production plant in order to not therefore be left to fix the prices. make it possible to reduce cost prices. If the fixing of prices is regarded solely as a In the letter of 28 May 1955 the High Au measure adopted within the context of the thority justifies the reduction in prices by equalization system, it is necessary to the argument that they are too high, which reject the argument put forward by the ap is shown by sales difficulties and by the fact plicant that that measure can be adopted that recourse is had to the equalization ar only under stricter conditions than those rangements under subparagraph (c).

correct.

with those of the Ruhr. Until 1 April 1956 those ruling in the common market. How prices in the Ruhr were maintained at an ever, as regards industrial coal, it is indeed artificially low level by a decision of the the Ruhr which determines the market High Authority and since their liberaliza prices since, unlike the French market tion on that date their rise has been limited which is traditionally a net importer, the by action taken by the German Govern Ruhr has the largest exportable surplus,

The gian prices can only make re-equipment question whether prices will come into line more difficult, since the receipts of the un as a result of the effect of free economic for dertakings will decrease as a result, despite ces or whether they can do so only if au the effect of equalization, since the latter is thoritative action is taken to lower Belgian on a sliding scale. prices is a question of economic policy and The defendant observes that the applicant involves an assessment of an economic must show that the aim of the contested de situation, on which the Court is not re cision is extraneous to the terms of the quired to pronounce. In any case, the High

situation. When it stated that the reasons end of the transitional period. In its reply for the decision are factually inaccurate the the applicant states that, instead of acting applicant was speaking from the point of on the basis of the trend in selling prices in view of the short-term economic situation, the common market, the High Authority and its opinion is valid only in the short should have assessed estimated production term. The High Authority must respect the costs once and for all at the beginning of spirit of the Convention and consider the the transitional period by an objective question from a structural point of view; method based on the probable trend in the grounds put forward in its letter, in those costs. The difference between the cluding the sales difficulties, must be un price and the production costs must be derstood in that way. progressively reduced by improvements in As regards the influence of prices in the production. During the oral procedure the Ruhr, the High Authority maintains that it applicant stated that the reduction in pro has never treated Ruhr prices as being duction costs which should theoretically

result from a real increase in output has put forward by the applicant show that, been more than neutralized by increases in even leaving aside the effects of the ration­ wages and social security contributions alization of marginal mines, production and the price of raw materials. With the costs fell by 43 francs between 1952 and agreement of producers estimates were 1955. The cumulative effect of the reduc­ made in 1953 in which the level of wages tions amounting to 39 francs ordered in and the other relevant factors were re­ 1953 and 1955 therefore remains within garded as constant for five years. However, the limits of the reductions in cost estimat­ when the estimated costs were revised in ed, without taking the marginal mines into 1955 the High Authority should have tak­ account, when the contested decisions en account of increases which had taken were adopted. place in the meantime. The applicant concludes that the average (d) Limitation on the power of the High of current prices is already below the level Authority to intervene of estimated production costs. The defendant recalls, first, that Article 26 The applicant maintains in its application (2) (a) sets a double limitation: prices must that by adopting Decision No 22/55 the be brought into line not only with estimat­ High Authority failed to give producers the ed production costs at the end of the tran­ opportunity of taking advantage of the sitional period but also with the ruling short-term economic situation existing at common market prices, the latter being de­ that time and thereby infringed Article 5 of termined by Ruhr prices which, before the the Treaty. decision was adopted, showed a difference The defendant has not given any direct an­ of between 80 and 100 francs for coking swer to that submission and the applicant smalls. has not developed it further in its reply. The estimated production costs must en­ able producers to meet competition in the common market at the end of the transi­ (e) Intervention by the Belgian Govern­ ment tional period. On the basis of that princi­ ple, therefore, Belgian production costs must fall. As regards individual produc­ The applicant alleges that Decision No tion costs, that reduction will result from 22/55 was adopted as a result of interven­ efforts to modernize and, as regards the av­ tion by the Belgian Government in order erage production costs of the Belgian coal to advance the aims of its own economic

JUDGMENT OF 16.7.1956 — CASE 8/55

mines. The exclusion of unclassified bit 22/55 uniformity reigned, since the equal uminous coals from the Campine from the ization arrangements differed only accord benefit of equalization in no way implies ing to the particular type of coal and were that those types are already sufficiently in the same for all coals of the same type in tegrated into the common market to be re the same category. Since the criterion was moved from the equalization system. It is the same for all collieries the principle of possible that if a new reduction were to be the selection of undertakings did not exist. ordered, equalization payments would The applicant considers that the aim of the once again be made to the Campine col equalization scheme is to maintain the le lieries as well. vel of receipts and that it applies to all Bel gian mines.

Treaty. In order to bring about a more ef nation with regard to the mines in the fective distribution, undertakings were al Campine, that is, that their location is par ready subjected to a process of selection al ticularly favourable, can never be put for though in a much less highly developed ward in relation to the application of the form, by the system established in 1953. equalization system, since the needs of the The objective of the equalization scheme is

to enable production to be adjusted to the aggregate amount of the equalization pay­ conditions of the common market and to ments must be gradually reduced. bring prices into line, not to provide com­ pensation in respect of the inevitable fall in (b) The threat to withdraw the equaliza­ prices. That implies that equalization pay­ tion payments ments must be distributed in proportion to the individual needs of the recipients, as is The applicant considers that the decision moreover indicated by the term 'enable'. contained in the letter of 28 May 1955 is vitiated by a misuse of powers in so far as According to the High Authority, Article it enables the Belgian Government, with 26 (2) does not lay down a uniform method the agreement of the High Authority, to with regard to the equalization payments withdraw the benefit of equalization from to be made under subparagraphs (a), (b) those undertakings which do not make the and (c). The equalization arrangements effort to re-equip regarded as necessary and provided for under subparagraph (a) are possible. The aim of the equalization general in scope and are dependant for scheme is none other than to ensure that their application only on the needs of pro­ the level of receipts is maintained. ducers, while the other two subparagraphs The defendant emphasizes that there can cover special cases which do not relate di­ be no question of any misuse of powers in rectly to integration into the common mar­ this instance. The authority which makes ket but compensate for additional price re­ the equalization payments is entiled to de­ ductions for certain sales. mand that the aim of the equalization The High Authority contests the allegation scheme, that is, the rationalization of the that the principle of selection is contrary to Belgian collieries, is effectively pursued. Article 24. Instead of guaranteeing that re­ To that end it is particularly effective to ceipts will be maintained at a specific level, threaten to withdraw equalization from that article is in fact intended to limit the those undertakings which do not make the closure of certain collieries. The Treaty in necessary effort. The aim of that threat is no way guarantees the maintenance of a to ensure that the equalization scheme per­ certain level of receipts and it would in forms the function assigned to it by the fact be impossible to do so, since the Convention.

JUDGMENT OF 16.7.1956 — CASE 8/55

(b) the letter states that in future equalization payments will be or may be with­ drawn from certain undertakings on the ground that they are not making the ef­ fort to re-equip considered possible and necessary or are refusing to carry out the transfers or exchanges of deposits which are regarded as indispensable for a better development of the mining areas.

FÉDÉRATION CHARBONNIÈRE BELGIQUE V HIGH AUTHORITY

is individual in nature and that the second, which relates to the threat to with­ draw the equalization, is general in nature. On that point the Court accepts the position adopted by the parties. During the oral procedure the defendant reaised the question whether it is pos­ sible to regard the latter measure as a decision capable of forming the subject- matter of an application for annulment in accordance with Article 33 of the Treaty. In its letter of 28 May 1955 the High Authority accepted that equaliza­ tion aid must be accompanied by a series of measures to be adopted by the Bel­ gian Government. Furthermore, it considers that the Belgian Government ought to apply four measures, indicated at points (a), (b), (c) and (d). The action re­ ferred to under (d) is, therefore, one of the series of measures which the Belgian Government would be obliged to take if the circumstances so required. The High Authority has thus unequivocally determined the attitude which it had decided to take henceforth should the circumstances mentioned under point 2 (d) of the letter arise. In other words, it has laid down a rule to be applied if necessary. It must therefore be seen as a decision within the meaning of Article 14 of the Trea­ ty.

Since the individual or general nature of each of the decisions has been esta­ blished, the applicant is entitled to seek the annulment of the reduction or with­ drawal of the equalization—the individual decision contained in the letter of 28 May 1955—by putting forward all the submissions referred to in Article 33 of the Treaty. In so far as the applicant considers that the two other decisions in­ volve a misuse of powers affecting it, it may lodge an application for their an­ nulment, since they are general in nature. In order for an application for the annulment of a general decision to be admis­ sible it is sufficient for the applicant to claim formally that there has been a mis­ use of powers affecting it, indicating convincingly the reasons which, in its opin­ ion, give rise to the presumption of a misuse of powers. The application satisfies the aforementioned conditions and is, therefore, admis­ sible.

states that associations and undertakings may contest not only individual deci­ sions but also general decisions in the true sense of the term. The defendant maintains in the alternative that the applicant is entitled to put forward only the submission of misuse of powers and that all the other sub­ missions must be set aside. The applicant, on the other hand, considers not only that it is entitled to put forward all the grounds for annulment, provided that it pleads a misuse of powers convincingly, but also that it may bring proof of the other defects in order to support the submission of misuse of powers. It considers that the Treaty has established a legal system in which, in order for their actions to be admissible, private undertakings may only plead a misuse of powers affect­ ing them; it would therefore be illogical to regard that submission as being mere­ ly exceptional and secondary in nature. That argument must be dismissed. If the Treaty provides that private undertak­ ings are entitled to seek the annulment of a general decision on the ground of misuse of powers affecting them, that is because they have no right of action on any other ground. If the applicant's argument were correct, undertakings would have a right of ac­ tion as extensive as that of the States and the Council and it would be difficult to explain why, instead of simply treating actions brought by undertakings in the same way as those brought by States or the Council, Article 33 introduced a clear distinction between individual decisions and general decisions, while restricting the annulment of general decisions in the case of undertakings to the submission of misuse of powers affecting them. The phrase 'under the same conditions' can­ not be interpreted as meaning that, after establishing a case of misuse of powers affecting them, undertakings are entitled to put forward in addition the other grounds for annulment, since once the misuse of powers affecting them is est­ ablished the decision in question is annulled, and that annulment does not have to be pronounced again on other grounds. The foregoing considerations clearly contradict the applicant's illogical view that the interpretation of the Treaty must be subordinated to the desire to grant to private undertakings a right of action which is almost identical to that avail­ able to the States and to the Council. Although such a wish is understandable, there is nothing in the Treaty from which it may be concluded that private un­ dertakings have been granted such a right to review the 'constitutionality' of gen­ eral decisions, that is, their conformity with the Treaty, since they are quasi- legislative measures adopted by a public authority with legislative effect 'erga omnes'. Although it is true that Article 33 accepts the existence of a right to bring an ap­ plication for the annulment of a general decision on the ground of misuse of pow­ ers affecting an undertaking, that is an exception which is explained by the fact that, in this case, it is still the individual factor which prevails. As against the general decisions, therefore, the applicant may rely only on the submission of misuse of powers affecting it. As regards the individual decision, since the parties are agreed that it may be so described, the applicant may rely

As regards the assessment of that level the applicant has maintained, first, that the High Authority is not entitled to modify the initial assessment of estimated production costs, since it constitutes a 'standstill level' which was to be deter­ mined at the beginning of the transitional period and was to remain unalterable unless modified by common agreement. That argument of the applicant must be rejected, since Article 26 of the Con­ vention provides that the inevitable reduction in Belgian prices shall be deter­ mined by the level of estimated production costs at the end of the transitional period. It follows that when there is a change in the estimated level of production costs a new assessment must be made which takes that factor into account. Secondly, the parties differ in law as to the method to be followed in assessing the level of estimated production costs. The Court considers that, before giving a ruling, it is necessary to establish what might reasonably be regarded as 'the approximate figure of production costs at the end of the transitional period' on the basis of estimates for each type and category of coal prepared in the light of the facts and circumstances known when that assessment is made. To that end, the replies given by the parties to the questions raised by the Judge- Rapporteur are not sufficient. As the parties have stated in their joint reply that such further details cannot be submitted to the Court within the time limits provided, it is appropriate to fix a new time limit for that purpose.

Upon reading the pleadings; Upon hearing the parties; Upon hearing the opinion of the Advocate General; Having regard to Articles 2, 3 (c), 4, 8, 14, 33, 34, 36, 50, 60 and 61 of the Treaty and Articles 1, 8, 24, 25 and 26 of the Convention; Having regard to the Protocol on the Statute of the Court; Having regard to the Rules of Procedure of the Court and to the Rules of the Court concerning costs,

4. Reserves the costs.

Pilotti Rueff Riese

Serrarens Delvaux Hammes van Kleffens

Delivered in open court in Luxembourg on 17 July 1956.

M. Pilotti A. van Kleffens President Judge-Rapporteur A. Van Houtte Registrar

OPINION OF MR ADVOCATE GENERAL LAGRANGE OF 12 JUNE 1956 2

Nature of the letter of 28 May 1955 as a decision in so far as it refers to the withdrawal of equalization 267

1 — Translated from the French.