C-36/58

ACCIAIERIE SAN MICHELE, Turin (41/58),

represented by Vittorio Frigerio, Agostino Artioli, Aldo Meroni, Gino Rossi and Bartolomeo Aragno respectively, assisted by Arturo Cottrau, Advocates of the Turin Bar and of the special roll of the Corte di Cassazione, Rome, with an address for service in Luxembourg at the Chambers of Georges Margue, 6 rue Alphonse-Munchen, applicants,

v

HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL Community, represented by its Legal Adviser, Professor Giulio Pasetti, acting as Agent, assisted by Professor Alberto Trabucchi, Professor at the University of Padua, Advocate of the Italian Corte di Cassazione, with an address for service in Luxembourg at its offices, 2 place de Metz, defendant,

Application for the annulment of Decision No 13/58 of 24 July 1958 on the management of the financial arrangements instituted by Decisions Nos 22/54, 14/55, 26/55, 3/56 and 2/57, published in the Journal Officiel No 10 of 30 July 1958,

THE COURT

Issues of fact and of law

I — History and subject-matter of Milan respectively) from which it appeared the dispute that they owed a certain sum to the CPFI in Brussels.

JUDGMENT OF 17.7. 1959 — JOINED CASES 36 TO 38, 40 AND 41/58

Equalization Fund or to any other 'while reserving the right to submit appropriate body; further documents, to call for any ...'

measure of inquiry and to put forward revoked the powers delegated to the any further submission considered to Equalization Fund and the Joint Bureau, have some favourable bearing on the reserving the right to delegate the 'task of case, that the Court of Justice of the enforcement' to the Fund or to 'any other European Coal and Steel Community, appropriate body'. any claim, defence or allegation to the The High Authority also reserved the right contrary notwithstanding, should: to: (a) Declare the present application ad­ 'overrule in so far as necessary all missible; deliberations of the Equalization Fund (b) Annul Decision No 13/58, and of the Joint Bureau' deliberated upon and adopted by the and to High Authority during its meeting on 'adopt such measures as may be necessary 24 July 1958 and published in the where any such deliberation is overruled'. Journal Officiel (first year No 10) of Finally, that decision provided: 30 July 1958, on the management of 'Where an undertaking fails to make the the financial arrangements instituted returns necessary for calculating the con­ by Decisions Nos 22/54, 14/55, tributions, the High Authority shall have 26/55, 3/56 and 2/57; power to make an estimated assessment; (c) Order the defendant to bear the costs.' the High Authority shall also have power to rectify on its own initiative returns in By letter dated 17 April 1959, amended on respect of which no supporting evidence 23 April 1959, the Registrar, in application is forthcoming'. of an order of the President of the Court

II — Procedure III — Submissions and arguments The procedure followed the normal course. of the parties The conclusions of the five applications are The submissions and arguments of the par­ identical and claim ties may be summarized as follows:

SIMET v HIGH AUTHORITY

Yet days (by virtue of the provisions of Arti no such facts are mentioned in the applica cle 84 (2) of the Rules of Procedure of the tion. Court, applicable to the applicant under taking as an Italian undertaking) starts to 2. The applicants defend six principal run on the fifteenth day after the publica points: tion of the decision in the Journal Officiel Their application is not based on Article 33, (Article 84(1) of the Rules of Procedure but on Article 34 of the Treaty, because its of the Court), that is to say, from 14 purpose is to ensure that the judgments in

them. It appears from a study of com on 20 and not 18 September because dies a parative law that interested parties may quo non computatur. The applications in contest regulations and not merely their in stituting proceedings were posted on 19 dividual application. September, which suffices because, ac Decision No 13/58 is general only in part, cording to the law of the six Member because in so far as it makes provision for: States, 'a measure shall be deemed to be notified merely by putting it into the post'. 'reconsidering the decisions adopted by The High Authority argues that the applica the Equalization Fund and the Joint Bureau so as either to confirm them or to tion is barred by lapse of time because the second paragraph of Article 33 of the Rules overrule them', of Procedure of the Court states that the the Meroni undertakings and the undertak pleadings 'shall be lodged with the Registry ings which are 'in analogous situations' are, within the prescribed period'. In addition, according to the judgments in Cases 9/56 the applicants' assertion on the solution and 10/56, faced with an individual decision brought in the Member States to the indirectly concerning them. problem of notification is only an un As soon as an examination of misuse of founded assertion. powers is accepted, it is useful to examine the other grounds as well. Furthermore, the (b) May the applicants be heard to raise the wording of the second paragraph of Article four grounds for annulment described 33 proves that as regards the admissibility in Article 33 of the Treaty? of an application it suffices to allege a mis The answer to this question depends on the use of powers, without giving supporting

'reasons' completely substantiating the The High Authority puts a wholly opposite allegation. interpretation on the articles of the new If the interpretation of Article 33 given by treaties quoted by the applicants in support the High Authority were to be accepted, of their line of argument: there would be an unacceptable contradic 'A reading of Article 173 of the Treaty es tion between Article 33 and Article 36, for tablishing the European Economic Com the latter article accepts as a defence a munity and of Article 146 of the Treaty ground which would be inadmissible by way establishing Euratom does not reveal of an application. anything other than that the High The recent treaties establishing the Euro Contracting Parties intended to exclude pean Economic Community and Euratom the possibility for individuals to bring an should influence the Court towards putting action against general decisions.' a liberal interpretation on the legal protec

Article 34. It is only an application for of powers in knowingly adopting a vitiated damages which can be based on that article. decision, instead of abstaining from so do The applicants do not prove they have an ing, and in adopting it with the intention of interest in bringing proceedings and 'come forcing any future applicants to base their forward, so to speak, as the animator(s) of application on the third paragraph of Arti some kind of popular action . . .'. cle 33, which does not permit the use of the The High Authority points out that in the four grounds of action which are authorized judgments in Case 9/56 (Impresa Meroni & by Article 35 in case of failure to act. C, Industrie Metallurgiche SpA v High The High Authority is committing a misuse Authority) and Case 10/56, (Impresa of powers in confirming, while purporting to Meroni & C, Industrie Metallurgiche, apply Article 34, the void decisions adopted Societá in Accomandita Semplice v High in application of the irregular Decision No Authority) the Court stated that: 14/55. 'the annulment of an individual decision The High Authority is committing a misuse as a result of the irregularity of the of powers in confirming, with the help of a general decisions on which it is based new decision, methods which have been held only affects the effects of the general unlawful. Estimated assessments have been decision in so far as those effects take held to be unlawful. concrete shape in the annulled individual The High Authority is committing a misuse decision'. of powers in using illegal methods in order General Decision No 13/58, which is being to put equalization into effect, despite the contested, was not adopted in application of fact that the Treaty itself, in Article 47, Article 34, but only in order to create a makes provision for a system of fines and situation complying with the requirements periodic penalty payments intended to force resulting from the judgments of the Court. defaulters to comply. In acting thus, the The applicants' argument based on a com High Authority wishes to avoid the parison between Articles 33 and 36 of the possibility of review. Treaty fails to recognize the nature of the

SIMET v HIGH AUTHORITY

The deliberations of the cle 34 of the Treaty in that: Brussels agencies, 'confirmed' by a 'new (i) it again is silent, in disregard of Articles measure' of the High Authority, will derive 5 and 47 of the Treaty, as to the reasons for their validity from the new measure. and the details of its action as regards equalization; 'The Court's criticism did not go to the (ii) it reiterates methods of valuation and of substance itself of the deliberations of the assessment 'lacking any legal basis' ac Brussels agencies but to the way in which cording to the judgments in Cases 9/56 and those deliberations were imposed on the

Brussels agencies. Court did no more than state that it was il Estimated assessments render it possible to legal. apply the equalization system in extreme 'That intimation does not connote the cases. No system of fines (Article 47 of the legal obligation, contained in Article 34, Treaty) can replace the procedure necessary to adopt a corresponding new general for equalization. decision.' The High Authority could only be accused (ii) Decision No 13/58 did not: of acting arbitrarily in making an estimated 'confirm the deliberations of the Brussels assessment in respect of particular cases. agencies. In reality, the decision in ques tion merely gives the High Authority (b) Infringement of the Treaty power to overrule or to confirm those In their applications, the applicants simply deliberations'. stated that in their view (iii) The applicants have not properly un 'the High Authority, in the contested derstood Decision No 13/58. decision, had infringed Articles 3, 5, 8, 'In effect, in the thinking of the authors 15, 34 and 47 of the Treaty'. of Decision No 13/58 it was clear that The applicants put forward further infor confirming or overruling depended on mation only in respect of some of these finding that the defects of form, at which heads of infringement of the Treaty. the criticism of the Court had been directed, were or were not present in the Article 34 (and on a subordinate level Arti previous procedure.'

JUDGMENT OF 17.7. 1959 —JOINED CASES 36 TO 38, 40 AND 41/58

'to extraordinary, inopportune and The High Authority replies that there can­ dangerous measures, such as estimated not be any doubt: Decision No 13/58 is assessments, whereas Community law has retroactive, because 'its stated purpose is to laid down appropriate and efficient rules make the general decisions accord with the in order that the right to information, to judgments of the Court of Justice, in so far which the High Authority is entitled, as the Court had acknowledged their shall be effectively available, by granting legality'. the High Authority the power to impose Furthermore, 'the power to make estimated very heavy fines and severe periodic assessments is a power granted ex nunc and penalty payments (5% of the average equally applies to past cases' and 'in view of daily turnover per day of delay) on the fact that the judgments of the Court call defaulting undertakings'. for a modification of the system, that To this the High Authority replies that: modification must necessarily be of a retroactive nature'. 'the assertion is gratuitous and stands in contradiction to the fact that the basis of the system of equalization has been (d) Infringement of an essential procedural recognized on a number of occasions as requirement being legitimate in nature'. This ground is put forward in the pleadings (c) Failure to state reasons — retroactive effect under the heading 'Infringement of the law'. Before adopting Decision No 13/58, the The applicants are of the opinion that in­ High Authority did not consult the Con­ adequate reasons are given for Decision No sultative Committee, because all that was 13/58, because it is not clear whether the involved was a modification to the existing High Authority has intended to give it procedure, itself created under Article 53(b) retroactive effect. Article 2 of the decision, of the Treaty, which does not require that according to the reasons given for it, only the said Committee be consulted.

SIMET v HIGH AUTHORITY

The third paragraph of Article 33 of the Treaty provides that applications shall be instituted within one month of the publication of the decision adopted.

Under Article 85 (1) of the Rules of Procedure of the Court of Justice of the Euro­ pean Coal and Steel Community, which remains applicable to the applications men­ tioned above in accordance with Article 111 of the Rules of Procedure of the Court of Justice of the European Communities, the period prescribed for instituting applications against decisions of the High Authority starts to run on the fifteenth day following the date of publication of the decision in the Official Journal of the Euro­ pean Communities.

Under Article 85 (2), the period is extended, on account of distance, by five days for parties residing in Italy.

Article 33 (3) of the Rules of Procedure of the Court provides that 'as regards procedural time limits, the date of lodging at the Registry shall alone be taken into consideration'.

Applications Nos 40/58 and 41/58 were lodged at the Registry on 22 September 1958.

JUDGMENT OF 17. 7. 1959 —JOINED CASES 36 TO 38, 40 AND 41/58

juvandum in Cases Nos 36/58, 37/58 and 38/58, in application of Article 34 of the Statute of the Court, as the conditions laid down by Article 71 of the Rules of Procedure of the Court are not satisfied.

For these various reasons, Applications Nos 40/58 and 41/58 are inadmissible.

Applications Nos 36/58, 37/58 and 38/58, lodged at the Registry on 5 September, were brought within the period prescribed by the Treaty and by the Rules of Procedure of the Court.

2. Is Decision No 13/58 general or individual in character?

Under the second paragraph of Article 33 of the; Treaty, undertakings may in­ stitute proceedings against decisions concerning them which are individual in character or against general decisions which they consider to involve a misuse of powers affecting them.

Those rules are to be applicable to all persons finding themselves in the circum­ stances specified for the application of such rules.

SIMET v HIGH AUTHORITY

Therefore the applicants' assertion that Decision No 13/58, in so far as it authorizes the High Authority to reconsider decisions adopted by the Equalization Fund and the Joint Bureau, in order either to confirm them or to overrule them, 'individually and directly concerns a small number of readily identifiable steel un­ dertakings of the Community' cannot be accepted.

For those reasons Decision No 13/58 is a general decision for the purposes of Article 33 of the Treaty.

3. Are Applications Nos 36/58, 37/58 and 38/58 against General Decision No 13/58 admissible?

Since Decision No 13/58 is a general decision, the applicants, according to Article 33 of the Treaty, may only institute proceedings against that decision if they con­ sider it to involve a misuse of powers affecting them.

Contrary to the applicants' allegation, Decision No. 13/58 cannot be considered as having that purpose, because it was directed at establishing a legal basis for the financial arrangements with the judgments in Cases 9/56 and 10/56 of 13 June 1958 had found fault.

JUDGMENT OF 17.7. 1959 —JOINED CASES 36 TO 38, 40 AND 41/58

The applicants allege that in adopting Decision No 13/58 the High Authority in­ tended to render it impossible for them 'to bring before the Court an action for failure to act under Article 35' and thus to oblige them 'to contest the decision (adopted by way of the trappings of a general decision) by reference to the ground of illegality which is the hardest to prove, namely misuse of powers affecting them'.

In putting forward that complaint, the applicants again fail to recognize the above- mentioned purpose of Decision No 13/58.

Moreover, the earlier general decisions could only be rectified so as to accord with the principles stated by the Court in its judgments in Cases 9/56 and 10/56 by a general decision adopted in accordance with the procedure laid down in Article 53 (b) of the Treaty.

The applicants assert that the misuse of powers 'is evident' when the High Authority declares:

The applicant's claim is based on their fear that the High Authority will apply Deci­ sion No 13/58 in a way which they hold to be illegal.

Such a complaint could only be raised in respect of individual decisions having made such an application of Decision No 13/58.

The applicants see a manifest 'misuse of procedure' in the fact that by Decision No 13/58 the High Authority intended:

'to make the unwarrantable equalization rates calculated by the Brussels agen­ cies behind closed doors and stubbornly kept secret by the defendant continue in force (even today, after the severe condemnations of the Court of Justice in the judgments of 13 June 1958). The means consist in using, whatever the contor­ tions involved, the statements of account conjured up out of the imagination, which the Court had considered as devoid of legal effect (it is still calling them now, in January 1959, by the euphemism "quasi-definitive"). Further, the means consist in persisting with a tenacity worthy of a better cause in not publishing the facts not covered by professional secrecy, which can be useful to the governments and to all interested parties'.

In submitting such complaints, the applicants again commit the error of interpreta­ tion already mentioned in respect of Decision No 13/58, and fail to recognize that the said decision does not in any way predetermine the circumstances in which it shall apply.

The applicants see further misuses of powers in the fact that by Decision No 13/58 the High Authority:

In its judgment in Case 9/56, the Court only ruled against a failure to state reasons for the estimated assessment, leaving the addressee ignorant of the way in which its debt had been calculated.

It is indeed the purpose of Decision No 13/58 to put estimated assessments on a legal basis, which had been lacking.

In putting estimated assessments on a legal basis, which had been lacking, the High Authority could not do otherwise than make use of such assessments in respect of undertakings which had failed to make returns as to their consumption of ferrous scrap for, if it had not made use of such assessments, the said undertakings would have been able, by persisting in defaulting, to avoid payment of the equalization contributions for which they were liable.

The applicants see an obvious misuse of powers in the fact that the High Authority has resorted 'to extraordinary and dangerous measures such as estimated assess­ ments', instead of limiting itself to using the means provided for in Article 47 of the Treaty of exercising pressure and imposing fines in order to force defaulting under­ takings to declare their consumption of ferrous scrap. It results from the considera­ tions set out in the preceding paragraph that estimated assessments can legitimate­ ly be made on undertakings which fail to comply with the requirement to submit returns, without which the equalization system could not be put into practice.

Therefore the making of an estimated assessment cannot involve a misuse of powers.

For all the reasons mentioned above, Decision No 13/58 does not involve a misuse of powers.

hereby

1. Declares that the applications of the undertakings Fer. Ro (Ferriere Rossi), an undertaking trading as an individual, Magliano Alpi (Cuneo) (40/58) and Acciaierie San Michele SpA, Turin (41/58), for the annulment of Decision No 13/58 of 24 July 1958, published in the Journal Officiel of 30 July 1958, are inadmissible.

2. Dismisses the applications of the undertakings Società Industriale Metallurgica di Napoli (Simet), SpA, Naples (36/58), Meroni & C, Industrie Metallurgiche, a limited partnership, Erba (37/58), and Meroni & C, Industrie Metallurgiche, SpA, Milan (38/58), for the annulment of the abovementioned decision as unfounded.

3. Orders the applicant to bear the costs.

Donner Riese Rueff Delvaux

Hammes Rossi Catalano