C-4/73

RUHRKOKLE AKTIENGESELLSCHAFT, a limited company having its registered office in Essen and

Ruhrkohle VERKAUFS-GESELLSCHAFTMBH , a private limited company having its registered office in Essen, represented by Otfried Lieberknecht, advocate of the Düsseldorf Bar, with an address for service in Luxembourg at the chambers of Alex Bonn, 22, cote d'Eich, interveners

Application for annulment of the Decision of the Commission of 21 December 1972, authorizing new terms of business of Ruhrkohle AG,

THE COURT

composed of: R. Lecourt, President, A. M. Donner and M. Sørensen, Presidents of Chambers, P. Pescatore (Rapporteur), H. Kutscher, C. Ó Dálaigh and A. J. Mackenzie Stuart, Judges, Advocate-General: A. Trabucchi

Registrar: A. Van Houtte

The facts and the arguments developed but also to have sold, during the by the parties in the course of the preceding coal industry year, written procedure may be summarized as (a) within the common market, at least follows: 75 000 metric tons of fuels originating from Community coal­ I — The facts fields, In pursuance of paragraph (2) of Article (b) of which at least 40 000 metric tons 12 of the Convention on the were to have been sold in the sales Transitional Provisions annexed to the area where he wished to acquire the ECSC Treaty and of Article 3 of the right to operate as a dealer, Decision of the High Authority No 37/53 of 11 July 1953 on the date of (c) of which at least 12 500 metric tons implementation of the prohibitions were to have been bought from the relating to agreements laid down by selling agency concerned. Article 65 of the Treaty (OJ, p. 153), the By way of derogation from these High Authority informed the mining conditions, the right of direct purchase companies of the Ruhr Basin, in May from selling agencies was also granted, 1954, that it could not authorize the for a transitional period originally continued existence of the 'Gemein­ limited to 31 March 1957 and extended schaftsorganisation Ruhrkohle GmbH' to 1 July 1957 by Decisions of the High (GEORG), the central organization for Authority Nos 10/57 (OJ, p. 159), 11/57 the coal, set up before the establishment (OJ, p. 160) and 12/57 (OJ, p. 161), of of the common market in coal. 1 April 1957, to wholesalers who, even On 15 February 1956, by Decisions Nos though failing to satisfy the quantitative 5/56 (OJ, p. 29), 6/56 (OJ, p. 43) and criteria imposed, had been supplied as 7/56 (OJ, p. 56), the High Authority direct wholesalers during the preceding authorized, subject to certain conditions, coal industry year or who could the joint sale of fuels by the mining establish that they fulfilled the companies of the Ruhr Basin associated conditions required during that year for to form the three selling agencies supply as direct wholesalers (sale of 'Geitling', 'Präsident' and 'Mausegatt'. 6 000 metric tons per annum of Ruhr coal). The trading rules authorized on that An action for annulment of Decision No occasion by the High Authority fixed, in particular, the conditions required for 5/56, brought by the selling agency acquisition of the status of direct 'Geitling', was dismissed by the Court in wholesaler, with the right to direct its Judgment of 20 March 1957 (Case purchase from a selling agency. For 2/56, Rec. 1957, p. 11). direct purchase from an agency, the By Decisions Nos 16/57 (OJ, p. 319), dealer had to meet not only the 17/57 (OJ, p. 330) and 18/57 (OJ, p. conditions ordinarily required of a 341) of 26 July 1957 the High Authority wholesaler (creditworthiness, establish­ supplemented and amended Decisions ment within a sales area, storage Nos 5/56, 6/56 and 7/56 of 15 February capacity, knowledge of the market and 1956 authorizing the joint sale of fuels the products, extensive custom, wide by the mining companies of the Ruhr range of categories and sorts for sale), Basin.

As regards qualification as a coal By Decision No 16/60 of 22 June 1960 wholesaler with the right of direct on the refusal to authorize a joint purchase, the respective quantitative marketing organization of mining minima were reduced from 75 000 to companies of the Ruhr Basin (OJ, p. 60 000 metric tons, from 40 000 to 1014), the High Authority opposed the 30 000 metric tons and from 12 500 to substitution for the system of sale by 9 000 metric tons. three independent agencies, of a single The Decisions of the High Authority sales organization embracing almost all Nos 16/57, 17/57 and 18/57 did not the mining companies of the Ruhr Basin.

reason of insufficient grounds, the selling agencies to render direct supplies provisions of Decisions Nos 16, 17 and to coal wholesalers subject to a single 18/57 relating to the conditions for quantitative criterion, namely the sale, qualification as a direct wholesaler. within the common market, during the preceding coal industry year, of at least By Decision No 17/59 of 18 February 6 000 metric tons of fuels originating 1959 extending the authorizations from the selling agency supplying the relating to the marketing organizations accredited dealer.

specific selling agency. By Decision of 27 November 1969 The essential provisions of Decision No authorizing the merger of the mining 36/59 were annulled in an action companies of the Ruhr Basin by the brought by the three selling agencies, by transfer of colliery assets to the company the mining companies of the Ruhr Basin Ruhrkohle AG, the Commission of the and by Firma Nold, by Judgment of the European Communities, applying Article Court of 15 July 1960 (Joined Cases 36, 66 (2) of the ECSC Treaty, authorized 37, 38 and 40/59, Rec. 1960, p. 857). the merger of the mining companies of

having sold not less than 6 000 directed against both the European metric tons of Ruhr coal in the Economic Community, represented by preceding coal year, but to the Ruhrkohle-Verkauf GmbH. conclusion of a two-year contract to An application to suspend the operation purchase not less than 6 000 metric of the Commission's Decision of 21 tons a year from Ruhrkohle AG for December 1972, brought by the Nold the supply of domestic and small undertaking on 13 February 1973, was consumers; removed from the Register of the Court by Order of the President of 14 March (b) before a dealer is entitled to supply 1973 at the request of the applicant. This industrial consumers he must first be Order reserved the costs. admitted to supply domestic and small consumers; In its reply, the applicant informed the Court that it was withdrawing its action (c) the qualification required of in respect of Ruhrkohle AG and admitted direct buying dealers for Ruhrkohle-Verkauf GmbH. By Order of the supply of large industrial 21 June 1973 the Court decided to concerns is not, as heretofore, a remove the case from the Register in so minimal annual consumption of far as it concerned these two companies 30 000 metric tons of solid fuels of and ordered the applicant to bear the any provenance, but the taking of costs incurred by the said companies in that tonnage of Ruhr products; the main action and in the interim dealers may sell to consumers procedure. beyond this limit only if they render The written procedure in the dispute special services. between the Nold undertaking and the Commission alone followed the normal However, provisionally, in the first year course. following the entry into force of the new terms of business, Ruhrkohle AG had to By application made on 29 October 1973 allow wholesalers contracting for the Ruhrkohle AG and Ruhrkohle-Verkauf stipulated minimum amount of 6 000 GmbH asked to be allowed to intervene metric tons a year of products for in the main action in support of the domestic and small consumers to take conclusions of the Commission. Having up to 15 % less than that amount. heard the opinion of the Advocate-

stated in writing the grounds for their business in force up till then related to conclusions. The applicant gave its reply the coal marketing year or the year for to these conclusions on 16 January and civil purposes, waited, for the benefit of 8 February and the defendant did the undertakings concerned, for the likewise on 8 February 1974. situation to become clearer during the following year before applying the terms Having heard the report of the of business relating to direct supply. The Judge-Rapporteur and the opinion of the Advocate-General the Court decided to applicant, although it continued to obtain direct supplies, had, in 1972, sold open the oral procedure without any only 700 metric tons. In these preparatory inquiry. circumstances, direct supply could not have been envisaged for the future even if the terms of business in force up to III — Submissions and argu­ that time had continued to apply. ments of the parties The applicant refutes the contention that the action is inadmissible on the grounds of lack of any legally protected interest. A — As to admissibility During the interim procedure the applicant obtained the assurance that it The interveners plead the inadmissibility would continue to be supplied as a of the action on the grounds of lack of direct wholesaler until this case was any legal interest. settled; it has therefore never ceased to In their opinion, the applicant can be be supplied on that basis. Consequently, considered as justifying a legally it is of little importance to determine protected interest only if its action could whether, accepting, for the sake of have the effect of obliging the argument, the validity of the old terms interveners to continue to supply it of business, it had a right which it could directly. That is clearly not the case. assert in this connexion. The terms of business authorized by the In its opinion, under the former terms of Decision in dispute replace the rules in business of Ruhrkohle AG, no dealer force up till then; in the case of automatically lost its status of annulment, therefore, the interveners can wholesaler by reason of the fact that it sell only in accordance with the rules did not sell an annual minimum of 6 000 previously in force. The latter rules metric tons. It is of little importance to made the direct supplying of coal determine whether the mining companies wholesalers subject to the condition of had the right to withhold supplies to the annual sales, within the common applicant as a direct wholesaler since, in market, of at least 6 000 metric tons of any case, they did not make use of any fuels, a condition which, on its own such possible right. admission, the applicant is very far from satisfying. Thus, it has in any case no right to direct supply. B — As to the substance In respect of 1973, the applicant can derive no rights from the fact that it 1. Violation of the principle of continued to obtain direct supplies in non-discrimination 1972 when already during the preceding year it had not satisfied the quantitative The applicant points out that, as from 1 criteria laid down with regard to this January 1973, it can no longer, in

accordance with the new terms of (b) In the case of the applicant, the loss business of Ruhrkohle AG, be of the status of wholesaler and of the considered as a direct wholesaler in the means of obtaining direct supplies coal trade. It is therefore a victim of involves lasting consequences especially serious discrimination. if there should be a change in the demand for coal. In this connexion (a) The terms of business of Ruhrkohle account should be taken of the fact that AG make deliveries on wholesale-market the drop in sales of coal to domestic terms subject to a clause obliging the consumers over the last few years is dealer to acquire at least 6 000 metric largely due to fairly exceptional climatic tons per annum of fuels for the domestic conditions and, moreover, that the sales and small consumer sector; during the situation could change dramatically if last two years the applicant has been there were difficulties — of a political unable to reach the minimum quota nature — in the supply of petroleum or henceforth required.

consequences. But, in the last analysis, Ruhrkohle-Verkauf GmbH. That is the the responsibility for the fact that the reason why in the second heading of its applicant can no longer sell even 6 000 conclusions the applicant asks that, at metric tons per annum lies with the very least, it should be exempt from Ruhrkohle AG and Ruhrkohle-Verkauf the new terms of business. GmbH or the former coal distribution (c) The applicant cannot be obliged to companies of the Ruhr. In fact, enter into an association with other Ruhrkohle AG concludes direct wholesalers who may be in a similar contracts for annual deliveries of more position and to combine its purchases than 30 000 metric tons.

The fact that the

(a) The complaint that Ruhrkohle AG with the railways and certain other and Ruhrkohle-Verkauf GmbH are industrial consumers applies to all responsible for the fact that the dealers without distinction and is, applicant is no longer in a position, by moreover, objectively justified by the reason of alleged discrimination on the particular circumstances with regard to part of those two companies, to these categories of consumer. The new purchase 6 000 metric tons of coal per provision in the terms of business, annum is not based on concrete data; in according to which deliveries by wholesalers to industrial consumers who any case, the objection does not in the defendant's opinion, cast doubt on the purchase annually more than 30 000 validity of the new terms of business of metric tons of Ruhr coal are subject to Ruhrkohle AG or their authorization by the rendering of certain special services, the Commission. also applies in an identical manner to all wholesalers qualifying for direct However that may be, it is not true that subsidiaries of Ruhrkohle AG and purchase. Ruhrkohle-Verkauf GmbH or dealers The drop in the volume of sales by the associated with the shareholders of applicant to a mere 700 metric tons in Ruhrkohle AG have offered coal for sale 1972 is not the result of discrimination at prices below list prices. There is no but is due to a general reduction in coal denying that before the implementation consumption and, above all, to the way of the new terms of business Ruhrkohle in which the applicant conducts its AG granted a special contractual business. discount ('Vertragsrabatt') to dealers (b) In this connexion, it should be who undertook by contract to buy a specific quantity of coal; but there was remembered that the applicant can retain mention of this discount in the price list its right to direct purchase by combining of Ruhrkohle-Verkauf GmbH and it was its purchases with those of other wholesalers in a similar position.

The result that the latter's marketing slight blow to their independence to companies are in competition with other which they may have to consent, wholesalers. As imports from other appears, considering the present state of Member States can have a considerable the coal market, to constitute an effect on sales of Ruhr coal it is natural insignificant evil. that the marketing companies of Ruhrkohle AG should participate in this (c) The second heading of the trade in order to compensate their losses. conclusions, directed at an annulment — As for direct transactions between in favour of the applicant alone — of Ruhrkohle-Verkauf GmbH and cus part of the contested Decision, is tomers in industry whose consumption incompatible with the necessarily general exceeds 30 000 metric tons per annum, it nature of the latter.

NOLD v COMMISSION

apply, in a like manner, to all on the basis of the fact that a Community dealers. In any case, the wholesaler's industrial transactions must applicant does not put forward any henceforth be dependent upon his factor capable of justifying his obtaining dealer status in the domestic contention that the treatment he receives and small consumer sector, so as to should differ from that received by all concentrate his activity on this latter other wholesalers. market.

JUDGMENT OF 14. 5. 1974 — CASE 4/73

completely compatible with this purpose, lead to a degree of stabilization of the bearing in mind in particular the current level of coal sales and it can help state of the market in coal. Ruhrkohle AG to plan its production. Since 1959, this market has been Moreover, the two-year contract gives those wholesalers whose sales the characterized, particularly in the Ruhr, by an almost continuous fall in coal preceding year did not quite reach the sales, especially in the domestic sector. stipulated level the possibility, through This recession is essentially due to the increased effort, of obtaining their increasing restructuring of the energy entitlement to direct purchase; the market and, especially, to the transitional period of one year, in substitution for coal of other types of conjunction with the tolerance of 15 % energy, in particular of domestic fuel oil. below the stipulated mimimum, is Ruhrkohle AG is obliged to attempt to intended to give them the opportunity of limit, at least in some degree, the heavy attaining this objective. financial losses which it has suffered by The new quantitative criterion tends to reason of inadequate profitability, by restrict the right of direct purchase to modifying its marketing organization dealers who really strive to sell the since in practice the structure of products of Ruhrkohle AG. Dealers production costs prevents the application whose sales fall on or below the tonnage of an effective stimulus to sales through qualification will be tempted, in order to price reductions. ensure the full use of their labour force

NOLD v COMMISSION

3. Failure to respect certain conditions to the Constitution. Moreover, the ECSC of the authorization Treaty contains no general principle of law, written or unwritten, guaranteeing The applicant maintains, in respect of the maintenance of acquired positions. the three sales areas provided by the contested Decision apart from the IV — Conclusions of the Federal Republic of Germany, that parties Ruhrkohle AG supplies coke for export at a price of 80 DM per metric ton The applicant, having amended its first whereas its price in Germany, according conclusions, claims that the Court to list prices, is around 140 DM. should The defendant refutes this assertion. (a) declare that the Decision of the Moreover, a distinction must be made

In any case, even if the applicant's (b) as a subsidiary matter: declare that assertions were correct, they do not the said Decision of the Commission affect the validity of the contested is void and inapplicable insofar as it Decision. Such practices can only induce relates to the applicant;

The applicant points out that since its Community, by international Conven­ establishment more than a century ago it tions and by the ECSC Treaty itself, in has never been able to sell 6 000 metric particular at Articles 4, 65 and 66. The tons of fuels per annum to domestic and Decision of the Commission directly and small consumers. On the other hand, it illegally interferes with the exercise of these rights. has supplied far greater quantities to industry. If this has not been the case The defendant maintains that the during the last few years the reason is instances of refusal to supply and the Ruhrkohle AG's refusal to supply it. discrimination which the applicant That is why it was unable, in 1970, to claims to have suffered through the meet an important order from action of Ruhrkohle AG have no Rheinstahl AG. relevance to the question — the only matter at issue in this case — of the Furthermore, the fundamental changes which have recently occurred in the legality of the contested Decision. The energy sector, in particular as regards same applies to the consequences, as yet competition between coal and pet­ unforeseeable, of the recent energy crisis. Subsequent events cannot cast doubt roleum, raise doubts as to whether the disputed trading rules are justified. In upon the legality of a Community act. contrast to what the Commission As for the question of fundamental permitted when it authorized the merger rights, the protection of property of the mining companies of the Ruhr ownership constitutes without any doubt Basin by the transfer of colliery assets to one of the guarantees recognized by Ruhrkohle AG, the latter is now in a Community law which, in this con­ position to determine prices, to control nexion, is based on the constitutional or restrict production or distribution or traditions of Member States and on to hinder effective competition in a acts of public international law, such as substantial part of the market. the Convention for the Protection of

Moreover, the Commission does not The Advocate-General delivered his directly intervene in relation to any opinion on 28 March 1974.

Law

1 By application lodged on 31 January 1973, the undertaking J. Nold, a limited partnership carrying on a wholesale coal and construction materials' business in Darmstadt, requested — in the final version of its conclusions — that the Court should annul the Commission's Decision of 21 December 1972 authorizing new terms of business of Ruhrkohle AG (OJ 1973, L 120, p. 14) and, as a subsidiary matter, that it should declare that Decision null and inapplicable insofar as it relates to the applicant.

The applicant objects essentially to the fact that the Decision authorized the Ruhr coal selling agency to render direct supplies of coal subject to the conclusion of fixed two-year contracts stipulating the purchase of at least 6000 metric tons per annum for the domestic and small-consumer sector, a quantity which greatly exceeds its annual sales in this sector, and that the Decision thereby withdrew its status of direct wholesaler.

JUDGMENT OF 14. 5. 1974 — CASE 4/73

As to admissibility

Accordingly, it cannot be denied that the latter has an interest in seeking the annulment of the Decision in issue.

On the substance

4 The applicant has not specified, with regard to the grounds for annulment set out in Article 33 of the ECSC Treaty, those upon which it is basing its action against the contested Decision.

5 In any case, an appreciable part of its argument must be dismissed directly, to the extent that the objections raised therein do not relate to the

NOLD v COMMISSION

provisions of the disputed Decision of the Commission but to the applicant's relationship with the interveners.

The Commission's authorization was granted by the Decision of 21 December 1972, which is the object of the dispute.

The rules approved by that Decision laid down new conditions stipulating the minimum quantities that dealers must undertake to purchase in order to acquire entitlement to direct supply from the producer.

In particular, direct deliveries are subject to the condition that a dealer shall conclude a two-year contract to take not less than 6000 metric tons per annum for the domestic and small consumer sector.

JUDGMENT OF 14. 5. 1974 — CASE 4/73

8 It is objected that the Commission allowed Ruhrkohle AG arbitrarily to fix this requirement so that, having regard to the quantity and nature of its annual sales, the applicant has lost its entitlement to direct supplies and is relegated to the position of having to deal through an intermediary, with all the commercial disadvantages which this involves.

Firstly, the applicant considers it to be discriminatory that, unlike other undertakings, it should lose its entitlement to direct supplies from the producer and should thereby be in a more unfavourable position than other dealers who continue to enjoy this advantage.

NOLD v COMMISSION

As regards the application of these criteria, it is not alleged that the applicant is treated differently from other undertakings which, having failed to meet the requirements laid down under the new rules, have likewise lost the advantage of their entitlement to purchase direct from the producer.

11 These submissions must therefore be dismissed.

2. As to the objection based on an alleged violation of fundamental rights

12 The applicant asserts finally that certain of its fundamental rights have been violated, in that the restrictions introduced by the new trading rules authorized by the Commission have the effect, by depriving it of direct supplies, of jeopardizing both the profitability of the undertaking and the free development of its business activity, to the point of endangering its very existence.

In this way, the Decision is said to violate, in respect of the applicant, a right akin to a proprietary right, as well as its right to the free pursuit of business activity, as protected by the Grundgesetz of the Federal Republic of Germany and by the Constitutions of other Member States and various international treaties, including in particular the Convention for the Protection of Human Rights and Fundamental Freedoms of 4 November 1950 and the Protocol to that Convention of 20 March 1952.

For this reason, rights of this nature are protected by law subject always to limitations laid down in accordance with the public interest.

Within the Community legal order it likewise seems legitimate that these rights should, if necessary, be subject to certain limits justified by the overall objectives pursued by the Community, on condition that the substance of these rights is left untouched.

As regards the guarantees accorded to a particular undertaking, they can in no respect be extended to protect mere commercial interests or opportunities, the uncertainties of which are part of the very essence of economic activity.

15 The disadvantages claimed by the applicant are in fact the result of economic change and not of the contested Decision.

It was for the applicant, confronted by the economic changes brought about by the recession in coal production, to acknowledge the situation and itself carry out the necessary adaptations.

16 This submission must be dismissed for all the reasons outlined above.

By the Order of 21 June 1973 the Court ordered the applicant to bear the costs incurred, at that date, by the companies Ruhrkohle AG and Ruhrkohle-Verkauf GmbH in the main action and in the interim procedure.

On those grounds

THE COURT

hereby:

1. Dismisses the action as unfounded;

2. Orders the applicant to bear the costs of the action including the costs reserved by the Orders of 13 February and 21 November 1973 and those awarded by the Order of 21 June 1973.