C-132/77

In Case 132/77

Société pour l'EXPORTATION des Sucres, SA., whose registered office is in Antwerp, represented by Wilma Viscardini, Advocate of the Padua Bar, with an address for service in Luxembourg at the Chambers of Ernest Arendt, 34 b Rue Philippe II, applicant, v

Commission of the European Communities, represented by its Legal Adviser, Peter Gilsdorf, acting as Agent, assisted by Jacques Delmoly, a Member of the Legal Department, with an address for service in Luxem­ bourg at the office of Mario Cervino, a Member of the Legal Department of the Commission, Jean Monnet Building, Kirchberg, defendant,

1 — Language of the Case: French.

JUDGMENT OF 10. 5. 1978 — CASE 132/77

CONCERNING, at the present stage of the proceedings, the admissibility of the application made under the second paragraph of Article 173 and alternatively under the second paragraph of Article 215 of the Treaty,

The facts and arguments of the parties facts with which the present action is put forward during the written concerned was governed by Regulation procedure may be summarized as No 1112/73 of the Council of 30 April follows: 1973 (Official Journal 1973, L 114, p. 4).

I — Facts and written procedure Having regard to the difficulties which such a system was likely to cause traders 1. Regulation No 974/71 of the who, when a monetary event occurred Council of 12 May 1971 (Official involving the fixing or alteration of Journal, English Special Edition 1971 monetary compensatory amounts, were

(I), p. 257) established, in trade between committed to performing contracts Member States and third countries, a containing prefixed conditions, Regu­ lation No 1608/74 of the Commission system of monetary compensatory amounts on imports and exports of agri­ of 26 June 1974 (Official Journal 1974, cultural products intended to L 170, p. 138) introduced "a certain compensate for fluctuations in the flexibility" into the Community rules national currency of Member States concerning those amounts by giving which exceed a certain limit. each Member State the power to apply a "natural justice" clause. Regulation No 974/71 was sub­ sequently amended and the above- Article 1 of that "regulation to ensure mentioned system at the time of the natural justice" provides:

EXPORTATION DES SUCRES v COMMISSION

On 15 March "1. If, in a given case, a Member State 1976 the French Government decided intends to make use of the author once again to allow the franc to float ization provided for in Article 1 in and it thus left the monetary snake. respect of a contract the duration of Following that decision monetary which exceeds: compensatory amounts were re introduced on 25 March 1976 in trade — the period of validity of the cer tificate where the certificate with France: that measure involved, as includes a prior fixing of the regards France, the grant of a monetary levy or the rebate in excess of compensatory amount on imports and three months, or the levying of a monetary compensatory amount on exports. — three months, in other cases,

JUDGMENT OF 10. 5. 1971 — CASE 132/77

particular Article 4 thereof, the order that they may, if necessary, give a applicant lodged with the Intervention statement of reasons for the decision Agency applications for exemption from taken.

"Under Article 4 of Regulation (EEC) No 1608/74 the Member States alone 4. By application under Article 91 of the Rules of Procedure lodged on 5 have the right to reject an application December 1977 the defendant asked for exemption. that the action should be dismissed as For this reason you should apply inadmissible and the applicant ordered directly to the French authorities in to pay the costs.

EXPORTATION DES SUCRES v COMMISSION

The applicant having claimed in its 1608/74. Only if the Member State did observations submitted on 24 January not agree with the Commission would 1978 that the objection of the formal procedure of Article 4 (2) be inadmissibility made by the defendant opened. should be dismissed and the defendant The memorandum sent by the French ordered to pay the costs, the Court Permanent Representation to the invited the Commission to produce the Commission on 19 January 1977 telex message which it sent to the concerning the "intention to grant French Permanent Representation on 25 exemptions" in relation to a number of February 1977 concerning the contracts, some of which had been memorandum relating to the "intention entered into between March 1974 and to grant exemptions" sent by it on 19 April 1975, does not come within the January 1977 and decided, after hearing scope of the formal procedure of Article the report of the Judge-Rapporteur and 4 (2) but within that of the the views of the Advocate General, to aforementioned preliminary infor­ open the oral procedure on the said mation. By a telex message dated 25 objection in accordance with Article 91 February 1977 the Commission (3) of the Rules of Procedure without informed the said Representation that any preparatory inquiry. since contracts were involved which were entered into on dates on which monetary compensatory amounts II — Submissions and argu­ applied in France, there appeared to be ments of the parties no justification for exempting the exports in question from the monetary In support of its objection of compensatory amounts applicable as inadmissibility the Commission observes from 25 March 1976. On this issue the in particular as follows: French Permanent Representation replied by telex message dated 15 (a) The application for annulment March 1977:

JUDGMENT OF 10. 5. 1978 — CASE 132/77

— Further, it is wrong to see in the under the second paragraph of Article letter of 7 October 1977 from the 215 of the Treaty. Director General for Agriculture to the applicant a measure against which an The applicant takes the view first of all application for annulment might be that the fact that there has been no directed. It is simply a letter supplying decision on the part of the Commission information sent in answer to a request specifically referring to the contracts in for information; as such it cannot bind question is not in itself sufficient to the Commission or, on the other hand, exclude the existence of a measure for express a final intention capable of which the Commission is responsible having legal effects. and which adversely affects the applicant. The applicant has never (b) The application far damages claimed that the Commission has

EXPORTATION DES SUCRES v COMMISSION

Further, measure contested the applicant by means of such a procedure the considers the admissibility of the action Commission would escape, or at least in relation to that measure. It makes the tend to escape, from its responsibilities following observations: and would cause the Management Committee to be excluded from partici (a) The application for annulment pation since in practice it would never be consulted. — The explanations given by the Commission regarding the way in which in practice the procedure provided for — However that may be, the by Article 4 (2) of Regulation No documents annexed to the application 1608/74 was conducted and the do not show that the cases with regard to which the Commission manifested its distinction which it makes in this respect between providing information and the opposition to exemption from the formal procedure under the said article monetary compensatory amounts were would seem to show that "in fact" the considered in the context of "a mere Commission established a different information procedure".

The Commission was justice" clause to certain contracts. It is moreover aware of it, for in asking accordingly difficult to understand why France by telex message of 25 February the Member State in question should 1977 for particulars in order to form a begin the said procedure only when it is final assessment of a certain number of aware of the views of the Commission cases (other than those concerned in the and knows that such views are un present action) it invited the French favourable. authorities to give such particulars Secondly, contrary to its claim that before 2 March 1977, that is to say consideration of the contracts notified before the expiry of the period of six for purposes of information prior to the weeks provided for in Article 4 (2) of formal procedure of Article 4 (2) offers the regulation. It even added that in the it an opportunity to interpret this or absence of such particulars the French that criterion laid down in Article 2 of Government was invited temporarily to the regulation, the Commission has no withdraw the files in question "but to power of interpretation in this respect. re- submit them as soon as it has been Interpretation of a Community measure possible to answer the questions raised"

(last part of point 3 of the telex Commission seems to attribute to it. message). The Commission's concern The applicant is asking quite simply for thus to regain the period of six weeks exemption, and not partial exemption, laid down by Article 4 (2) of Regulation from the monetary compensatory No 1608/74 shows that the procedure amounts for the reasons set out in its referred to in that provision had clearly application. Further, it is not the been instituted. Further, the lawfulness of the imposition of the Commission's attitude with regard to monetary compensatory amounts by the the contracts entered into before May French administration which is in issue, 1975, as appears from the but the lawfulness of the measure by aforementioned telex message, is firm which the Commission objected to and without reservation, contrary to exemption from those amounts. The that expressed with regard to the cases circumstances in issue are thus to be referred to at point 1 of the same telex distinguished from those concerned in message. It is obviously only in relation Joined Cases 12, 18 and 21/77. to the latter cases that it is possible to Accordingly, the defendant's argument speak of an "exchange of views" or "information". that the applicant should have brought its case before the French courts on the — The fact that the contested measure ground that the refusal by the French mentioned expressly only certain administration to exempt the contracts contracts and not others is quite in question is a "national measure fortuitous, since the notification by the implementing Regulation No 1608/74" French Government of its intention to has no legal foundation. grant exemptions was given in successive dispatches and the — As for the Commission's objection Commission was required to manifest that the applicant has not given a any objection it might have within the sufficient statement of the grounds on period provided for in Article 4 of the which its application for damages is regulation, which begins to run "from based, it is clear that the argument is the the day on which it is informed". same as that put forward in relation to the application for annulment. It is — The fact that the Management apparent from the application that the Committee was not consulted does not applicant considers that the Commission mean that the objection raised by the or its departments have acted or Commission to the intention to grant conducted themselves unlawfully in exemptions was without any legal effect. having caused the French administration Although a measure taken contrary to to refuse to grant exemption from the the rules of procedure is unlawful, it monetary compensatory amounts, thus must be applied so long as it is not violating the spirit and the letter of annulled. Regulation No 1608/74. — Finally, the contested measure is of direct and individual concern to the III — Oral procedure applicant within the meaning of the second paragraph of Article 173 of the EEC Treaty. The parties were heard on the admissibility of the action at the hearing (b) The application for damages on 11 April 1978. — The applicant's position is quite The Advocate General delivered his different from that which the opinion at the hearing on 26 April 1978.

5 It maintains that it has adopted no measure in the present case which could bind the power of decision of the French authorities with regard to the refusal to grant the exemption for which the applicant applied to them.

6 In its telex message of 25 February 1977 sent to the French Permanent Representation the Commission confined itself to considering the contracts notified by the French Government on 20 January 1977 — which in any event did not include the contracts in question — in the light of the criteria laid down in Article 2 of Regulation No 1608/74 and without instituting the procedure referred to in Article 4 of the said regulation.

JUDGMENT OF 10. 5. 1978 — CASE 132/77

7 The applicant alleges, on the contrary, that the procedure of Article 4 of Regulation No 1608/74 was indeed instituted in the present case, since in the aforementioned telex message the Commission had formally given its views on the subject of the French Government's intention to grant exemptions, of which intention the Commission had been informed in accordance with Article 4 (1).

8 Although the view expressed by the Commission referred to contracts other than those in question, it was nevertheless based solely on the fact that the contracts were entered into before May 1975 and therefore extends to the contracts in question, which were entered into in March 1975.

9 The letter of 30 September 1977 sent to the applicant by the Fonds d'Intervention et de Régularisation du Marché du Sucre (the French Intervention Agency for sugar) shows, moreover, that the position adopted by the Commission was decisive in the present case, since the Intervention Agency made express reference thereto to justify its refusal.

14 Intervention by the Commission restricting the discretion of a Member State is provided for by the regulation only in the case, referred to in Article 4, of contracts the duration of which exceeds three months or the period of validity of the export certificate, where the certificate includes a prior fixing of the levy or the rebate in excess of three months.

15 However, it appears from the above-mentioned article, and in particular from the words "in a given case" at the beginning of the first paragraph, that the Commission may intervene only in relation to specific cases in respect of which the Member State in question intends to make use of the clause to ensure natural justice and informs the Commission of its intention, "indicating the reasons therefor and the proof furnished", in order to enable it to assess all the facts capable of justifiying exemption from the monetary compensatory amounts.

16 Only after such notification may the Commission, under Article 4 (2), consider the individual case in which it is intended to grant exemption and state any objection which it may have to the measure contemplated.

17 It is clear that the French Government did not inform the Commission of its intention to grant exemption from the monetary compensatory amounts in respect of the contracts at issue in the present case, registered with the Intervention Agency under Nos S 125 and S 172.

18 In its notification of intention to grant exemptions dated 19 January 1977, received by the Commission on 20 January 1977, the French Permanent Representation does not mention, among the contracts listed in the memorandum, including those relating to supplies of sugar, the contracts in question.

22 The applicant alleges, however, in support of its conclusion in the alterna­ tive based on the second paragraph of Article 215 of the Treaty, that even in the absence of any intervention on the part of the Commission within the meaning of Article 4 of Regulation No 1608/74 the attitude conveyed by the Commission in the aforementioned telex message of 25 February 1977 was nevertheless responsible for the refusal on the part of the Intervention Agency which, in its letter of 30 September 1977, stated "in view of this attitude ... that it has not been possible to grant exemption from the monetary compensatory amounts in request of the deliveries of sugar which have been made ... under ... contracts Nos S 125 and S 172 entered into in March 1975".

23 Since the application of Article 4 of Regulation No 1608/74 involves the individual examination of each case, and having regard to the fact that the Commission was not put in a position to examine the contracts in question, no act attributable to it in relation to exemption from the monetary compensatory amounts may be said to have taken place in the present instance.

24 In these circumstances the relationship established by the aforementioned letter from the Intervention Agency between the decision to reject the application for such exemption and the Commission's telex message of 25 February 1977 can only be the result of an appraisal by the French auth­ orities themselves, on the basis of which the Commission cannot incur liability in respect of the contract in question.

25 Even after receiving that telex message it was open to the aforementioned authorities to inform the Commission of their intention to exempt the

28 For these reasons the present action must be dismissed as inadmissible.

Costs

29 Under Article 69 (2) of the Rules of Procedure the unsuccessful party shall be ordered to pay the costs.

30 The applicant has failed in its submissions.

OPINION OF MR MAYRAS — CASE 132/77

On those grounds,

Delivered in open court in Luxembourg on 10 May 1978.

A. Van Houtte H. Kutscher

Registrar President

OPINION OF MR ADVOCATE GENERAL MAYRAS DELIVERED ON 26 APRIL 1978 1

Mr President, At that time exports of sugar were Members of the Court, subject on leaving France to the On 18 and 19 March 1975 the applicant imposition of compensatory amounts sugar exporting company, with its due to the fluctuation of the French registered office in Antwerp, entered franc since it had left the "monetary into two contracts of purchase, one with snake" on 19 January 1974, whereas a dealer and the other with a manu­ exports of sugar from Belgium to third facturer, for the supply, respectively, of countries benefited from the grant of 1 000 tonnes of French sugar to be such amounts. delivered between October and December 1975 and for 5 000 tonnes to It seems that the sugar, the subject of be delivered between October 1975 and those transactions, was ultimately May 1976. intended for export to third countries

1 — Translated from the French.