C-21/58
ECLI:EU:C:1959:15
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JUDGMENT OF THE COURT
17 JULY 1959 <apnote>1</apnote>
Felten und Guilleaume Carlswerk Eisen- und Stahl AG and Walzwerke AG
v High Authority of the European Coal and Steel Community
Case 21/58
Application for annulment — Definition of a decision — Criteria applicable in the legal assessment of a measure by the High Authority — Effect of declarations issued by servants of the High Authority — Distinction between a decision and an internal office directive.
(Cf. summary, Judgment in Case 20/58 of 6 July 1959)
In Case 21/58
1. FELTEN UND GUILLEAUME CARLSWERK EISEN- UND STAHL AG, a limited company incorporated under German law, having its registered office in Köln-Mülheim, represented by its Board of Directors;
2. WALZWERKE AG, FORMERLY E. BÖCKING & Co., a limited company incorporated under German law, having its registered office in Köln-Mülheim, represented by its Board of Directors,
both assisted by Ernest Arendt, Advocate at the Cour d'Appel, Luxembourg, with an address for service in Luxembourg at the Chambers of the said Ernest Arendt, 27 avenue Guillaume,
applicants
v
High Authority of the European Coal and Steel Community , represented by its Legal Adviser, Frans van Houten, acting as Agent, assisted by Wolfgang Schneider, Advocate of the Frankfurt Bar, with an address for service in Luxem bourg at its offices, 2 place de Metz,
defendant,
Application for the annulment of the letter sent by the defendant on 18 December 1957 to the Office Commun des Consommateurs de Ferraille (OCCF) (Joint Bureau of Ferrous Scrap Consumers) and published in the Journal Officiel No 4 of 1 February 1958, in so far as that letter is to be considered as a decision within the meaning of Articles 14 and 15 of the Treaty, 1 — Language of the Case: German.
JUDGMENT OF 17. 7. 1959 — CASE 21/58
THE COURT
composed of: A. M. Donner, President, O. Reise, President of Chamber, L. Delvaux (Rapporteur), Ch. L. Hammes and N. Catalano, Judges,
Advocate-General: M. Lagrange Registrar: A. Van Houtte
gives the folowing
JUDGMENT
Issues of fact and of law
I — Conclusions of the parties This equalization system was continued by Decisions Nos 14/55 and 2/57 but, from 1 The applicants claim that the Court should: April 1955, the proceeds of the contribution '1. Annul the letter sent by the defendant were used to finance, besides equalization, on 18 December 1957 to the OCCF, and the granting of premiums for the increased published in the Journal Officiel of 1 use of cast iron. The implementation of the February 1958, p. 45 et seq., in so far as system in practice was entrusted to the Of that letter is to be considered as a deci fice Commun des Consommateurs de
sion within the meaning of Articles 14 Ferraille (OCCF) (Joint Bureau of Ferrous and 15 of the ECSC Treaty; Scrap Consumers) and the Caisse de Péré 2. Order the defendant to pay the costs. quation des Ferrailles Importés (CPFI) (Im ported Ferrous Scrap Equalization Fund), The defendant contends that the Court should: agencies operating under the control of the High Authority. '1. Take formal note that all the documents Under Decision No 2/57, the contribution of and communications relating to this each undertaking is obtained by applying, case shall be sent to the High Authority, for each accounting period, a basic rate to 2 place de Metz, Luxembourg; its consumption of bought scrap, and, if 2. Dismiss the application as unfounded; necessary, a supplementary rate to its excess 3. Order the applicants to pay the costs.' consumption of bought scrap. An undertak ing's total consumption of scrap is defined as being the sum of the tonnages of the total II— Statement of the facts amount of own resources and the amounts of bought scrap received, plus any decrease The facts of the case may be summarized as in stocks or minus any increase in stocks, follows: and minus any deliveries of scrap sold and/ By its Decision No 22/54 of 26 March 1954, or transferred. And by subtraction, the the High Authority established an equaliza consumption of bought scrap is equal to the tion system to prevent Community prices total consumption minus the total amount for ferrous scrap from being aligned on the of own resources and the decrease in stocks. higher prices for scrap imported from third Following these definitions, certain under countries. takings interpreted the term 'own resources'
CARLSWERK v HIGH AUTHORITY
as meaning 'scrap which has not been Walzwerke AG as the second applicant, and bought' and entered as own resources in asked for that undertaking to be allowed to their accounts with the Equalization Fund institute proceedings. The defendant stated all the tonnages received by them from sub that it had no objection on this point. sidiary undertakings having a different com The applicants take the view that, in so far pany name, but in which they possessed a as the letter can be considered as a decision controlling interest. In other words, in the within the meaning of Articles 14 and 15 of view of those undertakings, 'group scrap' is the Treaty, it is a decision concerning the 'own resources scrap' and therefore is not applicants which is individual in character, taken into consideration for the purposes of and that consequently the applicants can paying the contribution imposed on the con avail themselves of all the grounds listed in sumption of bought scrap. Article 33 of the Treaty. By a letter of 30 October 1957, the OCCF then asked the High Authority to take a 2. The substance of the case decision on this question under the second paragraph of Article 15 of Decision No First submission: lack of competence
2/57. In its reply of 18 December 1957, The applicants state that Decisions Nos published in the Journal Officiel of 1 22/54, 14/55 and 2/57, which provide for February 1958, the High Authority took the equalization in respect of all scrap which view that the question was misconceived has been bought, that is, solely in respect of and asserted in support of this view that scrap on the market, were adopted with the there already existed a well-established opi unanimous assent of the Council of nion linking the concept of 'own resources' Ministers and therefore can be amended to the legal concept of 'ownership'. only by following the same formalities.
By This application is for the annulment of the the contested letter, the High Authority pur aforesaid letter of 18 December 1957. ports to bring in for equalization scrap which has not been bought; thus it is amending the aforesaid decisions without III — Submissions and argu seeking the assent of the Council. ments of the parties The defendant takes the view that the sub mission based on lack of competence cannot be admitted (see supra: 'Admissibility') and The submissions and arguments of the par therefore replies to the arguments put ties may be summarized as follows: forward by the applicants in support of that submission only in the alternative.
1. Admissibility It asserts that the contested letter cannot be The defendant acknowledges that according considered as amending its previous Deci to the case-law of the Court (Cases 8/55 and sions Nos 22/54, 14/55 and 2/57 and that 9/55) a letter from the High Authority can therefore there was no occasion for the be contested as well as a formal decision. Council of Ministers to intervene. On the re But it asserts that the criterion in question quest of OCCF, the High Authority con applies equally to all the undertakings in the firmed and clarified the interpretation of the Community and that consequently the letter concept of 'own resources' which the OCCF in dispute is of a general nature. It follows had hitherto been following.
An interpreta from this that under the second paragraph tion in accordance with the habitual mean of Article 33 of the Treaty the applicants ing of the word and the material context is can put forward only the submission of mis not an amendment. use of powers affecting them. The exemptions granted in the contested By a letter of 26 March 1958, the agent ad letter also do not constitute an amendment
litem of the applicant gave notice that, by of the previous decisions. Indeed, it is for mistake, the application did not cite any higher administrative authority to
JUDGMENT OF 17. 7. 1959 — CASE 21/58
determine the limits of a decision by apply meaning of Article 80 of the Treaty. Under ing objectively defined and universally valid takings under that article are undertakings criteria. Unity of location is a criteria which constituting a whole and not the different fulfils these conditions. operational departments, even if they are autonomous in law. The contested letter Second submission: infringement of an es abandons the criterion of 'the undertaking' sential procedural requirement for that of the 'company name'.
3. According to the aforementioned deci The applicants state that under Article 15 of sions, only consumers who buy scrap on the Decision No 2/57, in the absence of a un market can benefit from equalization. The animous decision by the Board of the applicant consumers, however, cannot OCCF, the question of the definition of benefit from equalization because they bought scrap had to be settled by a decision receive scrap belonging to the undertaking of the High Authority governed by the rules forming a whole at notional prices which of Article 15 of the Treaty, which imposes are independent of the market. It is contrary an obligation to state the reasons on which to the very nature of equalization to include decisions are based. The letter complained in it consumers who cannot benefit from it. of, which is in reality a decision, does not
4. By retroactively bringing in for equaliza state the reasons on which it is based. tion scrap which has not been bought, the The defendant takes the view that the sub letter complained of goes against the general mission based on infringement of an essen principle of law according to which ad tial procedural requirement cannot be ad ministrative decisions should not be applied mitted (see supra: 'Admissibility') and retroactively. And the general principles of replies to the arguments in support of this law must be included in the rules relating to submission only in the alternative. the application of the Treaty. The defendant asserts that the complaint of
5. In order to define the concept of bought inadequacy of the reasons stated is without scrap, the letter complained of refers to the foundation. The third paragraph of the criterion of the legal person. It thus in letter complained of sets out the reasons on fringes Articles 3(b) and 4(b) of the Treaty, which the letter is based, which are founded which forbid discriminations, because, on the concept of ownership and on logical without sufficient grounds, it treats essen and literal interpretation. A more detailed tially identical situations in a different way. statement of reasons would have been re
6. Under the provisions of German tax law, quired only if the letter had diverged from a group of industrial works which are the normal meaning of words. According to autonomous in civil law but which are af the general principles of law, the reasons filiated in fact are regarded by virtue of that given are sufficient. affiliation as constituting a single economic unit. These fiscal principles must be applied Third submission: infringement of the in the same way to the equalization con Treaty or of rules of law relating to its
tribution. Moreover, the High Authority ad application mitted this in the case of Hoogovens, whose The applicants allege that Decisions Nos movements of scrap have been recognized as 22/54, 14/55 and 2/57, which are rules of own production because the Netherlands law relating to the application of the Treaty Government regards the two companies (first paragraph of Article 33), are infringed Hoogovens and Breedband, which are in several respects by the letter complained separate in law, as a single economic unit of. from the fiscal point of view.
1. According to those decisions, only The defendant takes the view that the sub bought scrap is assessable. mission based on infringement of the Treaty 2. Those decisions designate as bearing the cannot be admitted in this case (see supra: contribution all undertakings within the 'Admissibility'). Therefore it replies to the
CARLSWERK v HIGH AUTHORITY
applicants' arguments in support of that ings linked as regards organization, submission only in the alternative. economy and finances, rests on a legal foun According to the defendant, the applicants dation, ownership at the time of recovery, are confusing economic unity and legal un which cannot be of a discriminatory nature. ity. Only the latter is decisive for the As to the exemptions granted to Hoogovens application of the decisions concerning and Breda, they are based upon the ferrous scrap equalization. According to criterion of the existence of a single in Decision No 2/57 (Article 2) those liable to dustrial unit, locally integrated. This pay the contribution are 'the undertakings criterion is capable of objective application referred to in Article 80 of the Treaty which in all cases of a similar nature. consume ferrous scrap', that is, those work The criterion defined in the letter com ing directly with iron and steel but not the plained of is not an administrative measure holding companies or parent companies having retroactive effect, but only the state which exercise an influence over them. ment of what the administration had always When that provision speaks of an undertak held as its rule. It is true that the expression ing, it can mean only the legal person who 'own resources' (Eigenentfall) does not consumes the ferrous scrap. Although appear in Decisions Nos 22/54 and 14/55, German law recognizes for tax purposes the but in interpreting and applying Decision existence of organic, financial and economic No 2/57 it would be impossible to take 'own links between a parent company and one or resources' to mean anything other than did more subsidiary companies, that recognition the previous decisions, which referred to is always limited to definite sectors and the bought scrap and which therefore, logically, legal independence of the controlled com took the view that own resources were not
panies is not affected thereby. The courts assessable. On the other hand, the extensive have also expressly refused to extend the interpretation defended by the applicants theory of organic union (Organtheorie) to could not be applied unless it had been that of a subsidiary (Filialtheorie). precisely defined in the decision itself. Therefore, it is a priori impossible to take Fourth submission: misuse of powers the view that the recognition for tax pur poses in German law of an organic subor The applicants take the view that the defen dination can justify the application of par dant committed a misuse of powers: ticular rules of law within the framework of 1. By neglecting the objective of non- the ECSC Treaty. discrimination laid down by Articles 3(b) The defendant asserts that, if it gave way to and 4(b) of the Treaty; the demands expressed by the applicants, 2. By using its powers of defining conceps which unduly extend the concept of 'own contained in the decisions imposing the con resources' beyond its proper meaning, it tribution upon bought scrap in order to would result in discrimination on its part. bring into the equalization system addition Indeed, in the place of 'own-resources' the al tonnages of scrap in respect of which defendant would have to introduce in a the aforesaid decisions do not provide for fresh decision the concept of 'group scrap'. any equalization. Thus, in order to effect the equalization of The defendant answers that it has not mis the prices of assessable scrap and of im used the powers conferred upon it by the ported scrap, which has to be subsidized, the Treaty. Its conduct sprang from proper ad defendant would have to carry out a fresh ministrative, economic and legal considera apportionment of the contributions in tions. It had in view at all times the objec favour of groups and to the detriment of tives which are laid down for it and it did those plants which are not part of a group. not use its powers to pursue aims extraneous The different treatment applied, on the one to the Treaty. hand, to concentrations forming a single Furthermore, the infringements of the legal person and, on the other, to undertak- Treaty upon which the applicants seek to
JUDGMENT OF 17. 7. 1959 — CASE 21/58
rely under the heading of misuse of powers the explanations which it gave in the first can be alleged only as such, that is, as in three submissions.
fringements of the Treaty and not under the heading of misuse of powers. The defendant also points out that it is IV — Procedure
doubtful whether in the present case any misuse of powers which may have been com Although the name of the second applicant, mitted also 'affects' the applicants. On this Walzwerke AG, does not appear in the point it leaves the matter to the wisdom of application, this omission was corrected the Court. before the expiry of the period prescribed in As to its answer to the various arguments Article 33 of the Treaty, the defendant hav which the applicants put forward in support ing raised no objection on this point. of misuse of powers, the defendant refers to
Grounds of judgment
Admissibility
The letter of the High Authority dated 18 December 1957 sets out a general prin ciple in so far as it relates to the definition of the concept of 'own resources' with regard to scrap.
The letter was published in the Journal Officiel of 1 February 1958 and thus brought to the attention of all the undertakings in the Community.
It was described as a 'decision' by the Market Division, in a letter dated 19 February 1958 in answer to a formal request from the Deutsche Schrottverbrauchergemeinschaft sent to the High Authority on 6 February 1958.
However, contrary to the applicants' arguments, the said letter of 18 December 1957 cannot in law be considered as a decision within the meaning of the Treaty.
Although it is true that the said letter of 18 December 1957 followed a request from the OCCF, in the absence of unanimity among the members of that agency on the meaning of the term 'own resources', for the High Authority to define that concept in accordance with the second paragraph of Article 15 of Decision No 2/57, the High Authority replied that the question thus expressed by the OCCF 'was mis conceived' in view of the fact that 'from the beginning' that agency 'had by implica tion adopted the concept of own resources in accordance with the semantic value of the expression' and that this criterion had to be maintained.
It follows that the High Authority had no intention of adopting a decision, as it had been formally requested to do, but merely to reaffirm principles which it con sidered, rightly or wrongly, to follow logically from the basic Decision No 2/57.
CARLSWERK v HIGH AUTHORITY
This finding is confirmed by the fact that an amendment to Decision No 2/57 would have required, under Article 53(b) of the Treaty, the prior unanimous assent of the Council of Ministers, a condition which was not fulfilled in the present case. Moreover, there is no reason to suppose that the High Authority would knowingly have infringed this imperative provision.
These considerations are not invalidated by the fact that, in answer to a formal re quest from the Deutsche Schrottverbrauchergemeinschaft, sent to the High Authority on 6 February 1958, the Market Division replied by a letter of 19 February 1958 that the letter of 18 December 1957 was indeed a 'decision'.
In fact, by its very wording, this answer from the Market Division expresses the opi nion of an official of the High Authority and does not necessarily, in itself alone and in the present case, convey the intentions of the High Authority. It must be noted however, that that answer could have prompted, or even decided, the applicants to bring proceedings against this alleged decision, with the legitimate concern of safeguarding their interests.
However, the various subjective factors set out above cannot in themselves be decisive for the purpose of determining the nature of the letter of 18 December 1957 in question, since the nature of an administrative measure depends above all on its subject-matter and its content.
The said letter appears as being a directive of an internal character sent by a superior to services coming under its authority and intended to direct the activity of those services.
Therefore, if that letter could give rise to immediate duties, it could do so only on the part of the addressee organization and not of undertakings consuming ferrous scrap. Furthermore, this situation is corroborated by the fact that that letter of 18 December 1957 was published in the Journal Officiel only on 1 February 1958.
Accordingly, the letter of 18 December 1957 is not a decision within the meaning of the ECSC Treaty.
Consequently, the application is not admissible.
Costs
Under Article 60 of the Rules of Procedure of the Court of Justice of the ECSC, the unsuccessful party shall be ordered to pay the costs; in the present case the appli cants were unsuccessful on the issue of admissibility.
JUDGMENT OF 17. 7. 1959 — CASE 21/58
However, since the defendant by its letter of 19 December 1958 prompted, or even decided, the applicants to bring proceedings against the alleged decision contained in the letter of 18 December 1957, an order must be made that the parties bear their own costs.
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 Articles 14, 15, 33 and 80 of the Treaty establishing the ECSC; Having regard to the Protocol on the Statute of the Court of Justice of the ECSC; Having regard to the Rules of Procedure of the Court of Justice of the ECSC,
THE COURT
hereby:
Dismisses the application as inadmissible;
Orders the parties to bear their own costs.
Donner Riese
Delvaux Hammes Catalano
Decided in Luxembourg on 6 July 1959.
Delivered in open court in Luxembourg on 17 July 1959.
A. Van Houtte A. M. Donner
Registrar President
OPINION OF MR ADVOCATE-GENERAL LAGRANGE
(see Case 20/58, page 84)