C-92/78

2. Notices of periodic invitations to suspension of the levy on frozen beef tender for the sale of frozen beef held imported from non-member countries by the intervention agencies are must be reserved for the beneficiaries general acts which determine in defined by the said regulation, namely advance and objectively the rights and the processing industry. Therefore obligations of the traders who wish to Commission Regulation No 2901/77 participate in the invitations to tender is inconsistent with the objective of which these notices make public. the new Article 14 of the basic regu­ 3. Article 184 of the EEC Treaty gives lation in that it gives persons or under­ expression to a general principle takings unconnected with the sector conferring upon any party to of industry for which the benefit of proceedings the right to challenge, for the total suspension of the levy was to the purpose of obtaining the be reserved the right to take annulment of a decision of direct and advantage of this special import individual concern to that party, the system. validity of previous acts of the 5. Although it is true that maintaining institutions which form the legal basis anonymity is a precaution, taken of the decision which is being under national as well as Community attacked, if that party was not entitled law, in certain kinds of invitations to under Article 173 of the Treaty to tender and especially in those which bring a direct action challenging those involve the exercise of a discretion in acts by which it was thus affected relation to individual tenders, such a without having been in a position to precaution seems to be unnecessary in ask that they be declared void. The the context of an invitation to tender field of application of the said article for the sale of frozen beef held by the must therefore include acts of the intervention agencies, the outcome of institutions which, although they are which is decided with reference to a not in the form of a regulation, price fixed by the Commission after nevertheless produce similar effects an evaluation of all the tenders and on those grounds may not be received, taking into account the need challenged under Article 173 by for a fair apportionment of the natural or legal persons other than aggregate quantity among the under­ Community institutions and Member takings of the different regions of the States. Community. This must be more 4. Under the "linking" system provided especially the case in these for by Article 14 (3) (b) of the basic proceedings as the identification of Regulation No 805/68 of the Council the tenders by name is essential in as amended by Council Regulation order to prevent the same person No 425/77 the benefit of the total submitting two or more tenders.

APPLICATION for the annulment of Commission Decision No 78/258 of 15 February 1978 fixing the minimum selling prices for frozen beef put up for sale by the intervention agencies in accordance with Regulation No 2900/77 and specifying the quantities of frozen beef for processing which may be imported under special terms in the first quarter of 1978 (Official Journal L 69 of 11 March 1978, p. 36),

THE COURT

composed of: H. Kutscher, President, J. Mertens de Wilmars and Lord Mackenzie Stuart (Presidents of Chambers), A. M. Donner, P. Pescatore, M. Sørensen, A. O'Keeffe, G. Bosco and A. Touffait, Judges,

Advocate General: G. Reischl Registrar: A. Van Houtte

gives the following

JUDGMENT OF 6. 3. 1979 — CASE 92/78

The facts of the case, the course of the situations the Council considered that procedure and the submissions and certain special systems should be adapted arguments of the parties may be so that account might be taken in annual summarized as follows: estimates of both the supplies available to the Community and the Community's needs. It therefore amended inter alia I — Facts and procedure Article 14 of Regulation No 805/68 by providing that frozen meat intended for Article 13 (1) of Regulation No 805/68 processing which qualified for impor­ of the Council on the common organi­ tation under total suspension of the levy zation of the market in beef and veal from then on only benefited from this (Official Journal, English Special Edition exemption under new conditions: 1968 (I), p. 187) provides that a levy (a) The Council, on a proposal from the shall be charged on imports into the Commission, before 1 December Community of meat of domestic bovine each year, shall draw up an estimate animals, frozen, falling within tariff sub­ of meat which may be imported heading No 02.01 A II (a) 2 of the Common Customs Tariff. under suspension of the levy. This estimate shall take account, on the However Article 14 (1) of this regulation one hand, of the expected provides that frozen meat intended for Community supplies of meat of a processing (forequarters and boned or quality and type of cut suitable for boneless or unboned meat) shall qualify industrial use, and, on the other, of for special import terms consisting of the industrial needs (new Article 14 (2)). total or partial suspension of the levy. (b) The Commission shall determine Article 14 (13) (a) of the same regulation each quarter the quantities of the provided for the total suspension of the said meat which may be imponed levy in respect of meat intended for the under total suspension of the levy manufacture of preserved food falling and shall adopt detailed rules for the within tariff subheading 16.02 B III (b) application of Article 14 and parti­ which does not contain characteristic cularly those concerning control of components other than beef and jelly. the end use of imported meat (new On 14 February 1977 the Council Article 14 (4)). adopted Council Regulation No 425/77 amending Regulation No 805/68 (Official Journal L 61, p. 1). Whereas the situation on the beef and veal market which had for several years been characterized by a shortage accompanied by a rise in prices, had then degenerated into a market price slump made worse by massive imports, and import arrangements had to be adjusted to avoid a recurrence of similar

(c) Importation under total suspension intended for processing (Official Journal of the levy shall be made conditional L 338, p. 6). on production of an import licence As provided for in Article 1 (1) of this issued for a quantity falling within regulation importation with total the limits laid down each quarter; it suspension of the levy shall be may be made conditional, as far as conditional upon the submission of a necessary, on production of a purchase contract for frozen meat held purchase contract for frozen meat by an intervention agency, concluded in held by an intervention agency (new accordance with the said regulation. Article 14 (3)). Article 1 (2) provides that the sale shall take place by way of tender pursuant to The Commission adopted detailed rules Articles 6 to 14 of Regulation No for the application of the said Article 14 216/69 of the Commission of 4 February of Council Regulation No 425/77 in 1969 on detailed rules of application for Commission Regulation No 585/77 of the disposal of frozen beef and veal 18 March 1977 on the system of import bought in by intervention agencies and export licences for beef and veal (Official Journal, English Special Edition (Official Journal 1975 L 75, p. 5); Regu­ 1969 (1), p. 31); that regulation provides lation No 585/77 was itself subsequently inter alia that minimum selling prices in a amended and completed by Commission tendering procedure shall be fixed by the Regulation No 1384/77 of 27 June 1977 Commission, that if the tender is for less (Official Journal L 157, p. 16) and than the minimum price it shall be Commission Regulation No 2901/77 of refused and that the contract shall be 22 December 1977 (Official Journal L awarded to the highest tender, provided 338, p. 9). that when several tenders at the same price are received for the same quantity, These provisions stipulate that in order the intervention agency shall divide the to qualify for total suspension of the levy quantity available in agreement with the the application for a licence or licences tenderers concerned or award it by lodged by any one applicant must relate balloting. Article 1 (2) of Regulation No to a quantity corresponding to not less than five tonnes of bone-in meat and not 2900/77 refers to Regulation No 216/69 "subject to the special and derogating more than 10% of the quantity fixed by provisions laid down in this regulation". the Commission, pursuant to the new Article 14 of Regulation No 805/68 for Article 2 of Regulation No 2900/77 the quarter during which the application provides that the intervention agencies for a licence or licences is lodged (Article shall issue partial invitations to tender 3 of Regulation No 1384/77). Moreover applications for licences shall be considered only if they are made by a natural or legal person, who for at least 12 months has been carrying on business in the meat and livestock sector and is officially registered in a Member State (Article 1 of Regulation No 2901/77). On 22 December 1977 the Commission also adopted Regulation No 2900/77 laying down detailed rules for the sale of beef held by the intervention agencies to enable the import with total suspension of the levy of frozen beef and veal

every quarter "under the tendering frozen unboned beef at a price of Lit system" and that a general notice of 1 240 000 per tonne. invitation to tender shall be published at On 15 February 1978 the Commission the latest on the date of publication of adopted Decision 78/258/EEC fixing the first partial invitation to tender. the minimum selling prices for frozen Article 3 of the same regulation provides beef put up for sale by the intervention that tenders may be submitted only agencies in accordance with Regulation during the first ten days of each quarter. (EEC) No 2900/77 and specifying the However, on the first occasion, they may quantities of frozen beef for processing be submitted only between 20 and 30 which may be imported under special January 1978. Only tenders for a total terms in the first quarter of 1978 quantity of not less than five tonnes and (Official Journal L 69, p. 36). not more than 100 tonnes, expressed as Article 1 (1) of that-decision provides unboned meat, can be accepted. that the minimum selling prices for On the basis inter alia of Regulations No frozen beef stored by the intervention 216/69, No 2900/77 and No 2901/77 agencies which are to be adopted for the the Commission published on 13 January invitation to tender held in accordance 1978 (Official Journal C 11, p. 16) a with Regulation (EEC) No 2900/77, for "General notice of periodic invitations to which the time-limit for submitting tender for the sale of frozen beef held by tenders was 30 January 1978 shall be as the intervention agencies to enable the set out in the annex to the decision. import with total suspension of the levy Article 2 of the decision provides that for of frozen beef and veal intended for the period 1 January to 31 March 1978 processing". the maximum quantities of meat The Commission published at the same intended for the manufacture of time as the general notice of invitations "preserved food" which qualify for to tender several partial invitations to importation with total suspension of the tender including Notice of invitation to levy shall be 5 027 tonnes. tender No It P 1 — Regulation (EEC) On 23 February 1978 AIMA addressed No 2900/77 — for the sale of certain to Simmenthal a decision of refusal of its frozen unboned (bone-in) beef held in tender of 20 January since it did not stock by the Italian intervention agency come within the terms of the invitation (Official Journal C 11, p. 34). to tender.

On the same date, namely 13 April 1978, — Declare that the application is Simmenthal, pursuant to Articles 185 and admissible; 186 of the EEC Treaty and to Article 83 — As provided for in Articles 173 and (1) of the Rules of Procedure made an 174 of the EEC Treaty, declare application for suspension of the Commission Decision No 78/258 of operation of the effects of Commission 15 February 1978 to be void, and, Decision No 78/258 and for an order consequently, as provided for in that the Commission instruct the national Article 184 of the EEC Treaty, authorities to suspend the issue of import declare the Notice of invitation to licences corresponding to contracts of tender No It P 1 of 13 January 1978, purchase entered into by successful the General notice of periodic tenderers with the intervention agencies invitations to tender of 13 January and to suspend until judgment is given 1978 of the same date, Regulation on the substance of the case the No 585/77, Regulation No 2900/77 application of special import arrange­ and Regulation No 2901/77 to be ments for frozen beef intended for inapplicable; processing. — Order the Commission to pay the The President of the Court by order of costs.

22 May 1978 dismissed the application and reserved the costs. The Government of the Italian Republic The Government of the Italian Republic claims that the Court should uphold the made an application on 20 July 1978 applicant's submissions. pursuant to the first paragraph of Article The Commission contends that the Court 37 of the Protocol on the Statute of the should: Court of Justice of the European Economic Community and to Article 93 — Dismiss the application as being of the Rules of Procedure to intervene in either inadmissible or unfounded; this case for the purpose of supporting — Order the applicant to pay the costs. the submissions of Simmenthal.

application: the time-limit for instituting which the contested decision is based are proceedings has been observed and, inapplicable and consequently an although Commission Decision No acknowledgment that they are invalid 78/258 is addressed to the Member and need amending the applicant's States and its rules cover an indefinite objection is to enforce a reorganization number of situations it is of direct and of the system of imports under special individual concern to the applicant. terms introduced by the regulations in On the other hand the application is question, either out of respect for a inadmissible because the applicant has no general legal principle or, in point of interest in taking legal proceedings. fact, with a view to its own ideas being

actively. The annulment of the decision cannot have the slightest practical effect: measure, the hypothetical consequences the contracts have been concluded, the of which would establish that any interest that the applicant may have in licences issued and the imports have been effected, while the tenders which have instituting proceedings is wholly lacking, is endeavouring, by an improper use of not been accepted are henceforth non- existent. The decision has fully served its the provisions of Article 184, to call in question the regulations which serve as a purpose and if it is annulled the applicant basis for the measure formally challenged cannot reap any benefit whatever. while evading the conditions for the The contested decision is not a typical admissibility of proceedings under Article individual decision which requires or 173. forbids a particular person to do or not The true function of Article 184 is to to do something; its main function is to enable the plea, in the context of record, on the basis of objective factors, proceedings before the Court, that a the outcome of a clearly defined regulation is inapplicable to be made as a tendering procedure which culminated in submission affording additional proof for the applicant's tender not being accepted. the purpose of the decision on the To annul such a decision would certainly substance of the case.

SIMMENTHAL v COMMISSION

Even if the applicant was unable to derive any retro decision may challenge the general decisions which the decision he is active advantages if the contested measure were annulled the fact attacking implements so as to prevent an nevertheless remains that in a legal order illegal general decision being applied to based on the rule of law the Commission him. This plea of illegality is a general would have to make the necessary principle of Community procedural law. amendments to the acts which the Court The sole condition which has to be

JUDGMENT OF 6. 3. 1979 — CASE 92/78

Council Regulation No 425/77, the cedural requirement in that it does not Commission had to determine the state any. of the reasons upon which it is relationship between the quantities which based. may be imponed with total suspension of It does not contain any information the levy and the quantities covered by a which could enable the parties concerned purchase contract entered into with an and the Court to evaluate the reasons intervention agency. The determination which determined the choices made by of this relationship ought to have been the Commission as far as concerns the covered by a statement of reasons fixing of minimum selling prices for the dealing in particular with the size of the meat held by the intervention agencies stocks and the urgency of the need to and of the quantities which may be reduce them; on the contrary the imported under the special arrangements relationship in question is found for the first quarter of 1978. unexpectedly in an annex to Regulation No 2901/77 without there being any With regard to prices two objectives had reference to it in the recitals in the to be reconciled. The aim of Regulation preamble or in the operative part thereof. No 98/69 of the Council of 16 January 1969 (Official Journal, English Special As far as concerns the determination by Edition 1969 (I), p. 14) and Regulation the Commission each quarter of the No 216/69 of the Commission was to quantities of frozen meat which may be dispose of stocks of frozen beef and veal imponed with total suspension of the held by intervention agencies at the levy the contested decision merely fixes highest possible price so as to reduce to a them, without any justification minimum the burden of the charges for whatsoever, for the first quarter of 1978, at 5 027 tonnes of meat intended for the intervention and storage operations in the Community balance sheet. The manufacture of preserved food.

SIMMENTHAL v COMMISSION

quantities qualifying for assisted import­ ation for the first quarter of 1978 it did (c) Neither Regulation No 2900/77 not take any account of the actual avail­ nor the General notice of periodic abilities of frozen meat and of the invitations to tender contains any indication of the reasons which led the requirements of the processing industry of the various Member States; when it Commission to apply the procedure fixed the minimum selling prices it known as "linking" ("couplage" or completely ignored the public interest "jumelage") to imports of beef and veal which has priority and on which the with total suspension of the levy for whole of the special import arrangements 1978. Article 14 (3) (b) of Regulation No are based. It has therefore been guilty of 805/68, as amended by Regulation No a serious misuse of its powers and has clearly exceeded the limits of the

JUDGMENT OF 6. 3. 1979 — CASE 92/78

cessors themselves. Entitlement to parti (d) The detailed rules for the cipate in the tendering system is based on application of the special import a fixed quantitative restriction of the arrangements adopted by the individual applications and on a general Commission in its Regulations No limitation of the tenders without giving 985/77, No 1384/77 and No 2901/77 any consideration either limitation of the are in breach of the principles and tenders without giving any consideration contrary to the objectives of Article 14 of either to the kind of processing the basic Regulation No 805/68 of the envisaged or the size of the industries or

the spirit and the objectives of the special introduces serious discrimination to the import arrangements and may be vitiated detriment of the preserved food industry on the ground of misuse of powers and for which the special import is in breach of the principle of propor arrangements nevertheless claim to tionality. provide. In this way the actual processors are forced to compete with a virtually The complicated "linking" operation has unlimited mass of people (breeders, been put into effect without taking into wholesalers", forwarding agents and even account in a proper manner the dual ordinary retailers) who are not in any function allotted to it.

The Commission without regard to the use to which it must be put gives successful tenderers who are not processors an additional privilege.

has completely disregarded the public traders interested in any way in the beef interest, which is just as important as the and veal sector can have access, without interest in the disposal of stocks which discrimination, to the quantities which underlies the second stage of the may be imported and the absence of any "linking" operation, namely the special obligation making the purchase of meat imports. For this reason the Commission from an intervention agency conditional is guilty of having misused its powers. on its being used for an industrial

powers. non-member countries upon terms which are not too onerous compared with those The Commission considers that all the on the world market; on the other hand they confer an unconscionable privilege applicant's submissions are completely unfounded. as regards the second requirement, which is due to the need to dispose of surplus (a) The contested decision contains all meat held by the intervention agencies. the requisite factors for its justification, The results of the invitation to tender, which are based on the regulations the proceedings in which have been underlying it. attacked by the applicant, confirm un equivocally that the minimum selling price has been fixed at a level which nullifies the advantage given to the processing industries.

JUDGMENT OF 6. 3. 1979 — CASE 92/78

Its function, which is a typically Regulation No 2900/77 has put in administrative one, consists in bringing concrete form a possibility expressly the all-important tendering procedure provided for in Regulation No 805/68 stage to a conclusion; it fits into a system (as amended by Regulation No 425/77). with which both the intervention agency Making the importation with total and the traders themselves are familiar. It suspension of the levy, if need be, may be regarded as an administrative conditional upon the production of a measure for co-operation between the purchase contract for frozen meat held Commission and the intervention by an intervention agency is justified by agencies in the course of administering the necessity to take account of a the system. If account is taken of the difficult situation on the Community market the distinctive feature of which is operative part of the decision and of the principles upon which the system is based the presence of surpluses of a dangerous there is nothing in the contested decision size. The aim of this system is not to which either the intervention agencies or guarantee an unlimited supply of meat the traders concerned find is at all coming from non-member countries but ambiguous. Each participant in the to meet the needs of the processing invitation to tender knows perfectly well industries while taking into account the that its tender will be rejected if it is general situation on the home market. lower than the minimum price or if it The linking is in this respect a satis­ exceeds that price but the competing factory compromise: it enables, on the tenderers have tendered higher prices, all one hand, fairly large quantities of meat such tenders being subject to the held by the intervention agencies to be quantities available. Fixing the minimum disposed of and, on the other hand, prices and acceptance of the best tenders makes it possible to effect imports free of the levy. is based on criteria which are completely objective: the actual market conditions, In these circumstances the measure by the tenders received, the quantity and means of which the Commission has

The Community authorities have always An advantage which is granted does not respected the general principle that when necessarily remain invariable or continue to be worth the same. meat is bought from the intervention agencies the purchasers are guaranteed It would be at the very least be risky to equal access to the goods and equal assert that the "linking" system has treatment. Meat imported under the triggered off a crisis which has a cata­ special arrangements is moreover strophic effect on the processing conditional on its being used for a industries.

specific purpose (Article 11 (1) and (9) In any case the special arrangements of Regulations No 585/77 as amended provided for in Article 14 of Regulation by Regulation No 1384/77). In the final No 805/68 is only one of the advantages analysis the financial gain derived from which the Community processing the opportunity to effect special imports industries enjoy. is in any case reaped by the processing (e) To claim that Regulation No industries, even if it is slightly reduced by 2900/77 is in breach of the principle that the profit margins deducted by the there must be no discrimination is commercial middlemen. astounding.

the system is to function properly submitted several tenders in the different maximum individual quantities have to Member States, since such a practice is be fixed. specifically forbidden by Article 3 (5) of Apportionment based on the capacities Regulation No 2900/77. This of the processing industries would have prohibition, like the restricting of raised serious problems; difficulties of individual tenders to a maximum of 100 the assessment of these capacities would tonnes, is prompted by the need to have come up against objective ensure that the quantities available are difficulties, and, in any case, because of apportioned fairly among all the the imbalance between the different processing industries which are regions of the Community, the effect of interested. such an apportionment would have been to favour the industries of certain Member States which are much larger V — Oral procedure and have a far greater manufacturing capacity than the corresponding Italian The parties presented oral argument and industries. answered the questions put to them by the Court at the hearing on 22 (f) The fact that the Commission is November 1978. aware of the names of the tenderers and of the particulars of their tenders is The Advocate General delivered his solely due to its concern to be able to opinion at the hearing on 24 January find out whether one undertaking has 1979.

Decision

1 The applicant by an application lodged on 13 April 1978 pursuant to the second paragraph of Article 173 of the EEC Treaty requests the Court in its finally amended statement of claim to annul Commission Decision No 78/258 of 15 February 1978 fixing the minimum selling prices for frozen beef put up for sale by the intervention agencies in accordance with Regu­ lation (EEC) No 2900/77 and specifying the quantities of frozen beef for processing which may be imported under special terms in the first quarter of 1978 (Official Journal L 69, p. 36).

3 It should in the first place be borne in mind that Article 14 of Regulation No 805/68 of the Council of 27 June 1968 on the common organization of the market in beef and veal (Official Journal, English Special Edition 1968 (I), p. 192) had provided in Article 14 thereof for special import terms consisting of the suspension of the levy for the benefit of certain frozen meat intended for processing, namely:

(a) rules for the total or partial suspension of the levy in respect of meat intended for the manufacture of certain preserved pure beef and veal and

(b) similar rules benefiting the other uses for which meat is processed by the processing industry, the advantage to be derived being conditional on the submission by the importer of a contract for the purchase of a fixed quantity of frozen beef and veal held by an intervention agency, known as the "linking" system.

JUDGMENT OF 6. 3. 1979 — CASE 92/78

4 These rules from which the preserved food industry derives very great benefit were later made subject to more restrictive conditions by Council Regulation No 425/77 of 14 February 1977 (Official Journal L 61, p. 1).

5 The second recital in the preamble to that regulation, after having drawn attention to the fact that the previous rules were justified because there was a shortage accompanied by a rise in prices, states that this situation has since then degenerated into a market price slump made worse by massive imports.

as provided for in the new Article 14 of Regulation No 805/68, namely Regulation No 585/77 which was in turn amended and supplemented by Regulation No 1384/77 of 27 June 1977 (Official Journal L 157, p. 16), laying down the rules for issuing import and export licences provided for by Article 14 (3) (a) and also Regulations No 2900/77 and No 2901/77 of 22 December 1977 which lay down, in various ways, the detailed rules for the application of the system known as "linking".

11 The General notice of periodic invitations to tender of 13 January 1978 and a complete set of specific invitations to tender for the first quarter of 1978 published on the same date including Notice of invitation to tender No It P 1 relating to Italy have been issued pursuant to those regulations.

12 Out of all these regulations the following provisions have special relevance in these proceedings:

"(b) If the price tendered is lower than the minimum price fixed by the Commission of the European Communities the tender shall be rejected.

(d) Each tenderer shall be informed without delay by the intervention agency of the outcome of his participation in the invitation to tender.";

— Finally: Notice of invitation to tender No It P 1 of 13 January 1978 which states that the Italian intervention agency AIMA shall sell approx­ imately 4 000 tonnes of beef in accordance with the rules laid down in the general notice of invitations to tender and that only tenders which reach AIMA on 30 January 1978 at the latest shall be considered.

13 The applicant submitted to AIMA on 20 January 1978 a tender for the purchase of 100 tonnes of frozen beef offering a price of Lit 1 124 000 per tonne (1 091.26 units of account per tonne).

14 AIMA forwarded this tender forthwith to the Commission together with all the other tenders collected in Italy.

15 The Commission having considered all the tenders forwarded by the intervention agencies of the various Member States adopted Commission Decision No 78/258 of 15 February 1978 addressed to the Member States. Its purpose is to fix the minimum selling prices applicable in the different Member States, the minimum selling price for Italy as far as concerns the category in which the applicant is interested being fixed at 1 601 units of account per tonne.

20 In fact the Commission takes the view that the annulment of the decision cannot bestow upon the applicant the advantage which it is seeking now that the contracts in accordance with the invitation to tender have been concluded, the licences have been issued and the imports have been effected, while the tenders which have not been accepted are henceforth non-existent.

21 Since the applicant has elected to apply to this Court and directly challenge the Commission decision, and not to apply to the national courts and there challenge the decision of refusal addressed to it individually by the Italian intervention agency, any decision as to the admissibility of the application is concerned with the division of jurisdiction between this Court and the national courts.

22 Consequently it is necessary for the Court to consider of its own motion the question whether the application is admissible viewed as a whole and not just from the standpoint of the objection raised by the Commission.

23 The Commission adopted the decision at issue after the national intervention agencies had forwarded to it the tenders which the latter had received in answer to the invitations to tender issued by the notices of 13 January 1978.

24 The Commission therefore took into consideration the applicant's tender together with the other tenders submitted within the whole of the Community with a view to fixing a price which was to ensure that a pre­ determined quantity of meat held by the intervention agencies was disposed of at the most profitable prices for them.

JUDGMENT OF 6. 3. 1979 — CASE 92/78

30 This jurisdiction is also conferred upon national courts should the intervention agencies disregard any Community legal provisions, since the responsibilities assumed by the institutions of the Community do not cover the disputes which might arise out of such actions.

SIMMENTHAL v COMMISSION

31 Contrary to the Commission's submissions it cannot be denied that the applicant has an interest in the application which it has brought.

32 Even though the contested decision has already been fully implemented for the benefit of the other tenderers participating in the same invitation to tender the applicant retains an interest in the annulment of this decision; such interest consists either in its being restored sufficiently by the Commission to its original position or in inducing the Commission to make suitable amendments in the future to the system of invitations to tender if the latter is found to be incompatible with certain legal requirements.

33 The plea of inadmissibility which the Commission has raised must therefore be rejected.

34 While the applicant formally challenges Commission Decision No 78/258 it has at the same time criticized, in reliance on Article 184 of the EEC Treaty, certain aspects of the "linking" system in the form in which it has been implemented pursuant to the new Article 14 of Regulation No 805/68, by Regulation No 2900/77 and No 2901/77 and also by the notices of invitations to tender of 13 January 1978.

39 As the Court in its judgment of 12 June 1958 in Case 15/57, Compagnie des Hauts Fourneaux de Chasse v High Authority of the European Coal and Steel Community [1957 and 1958] ECR 211, and in its judgment of 13 June 1956 in Case 9/56, Meroni & Co., Industrie Metallurgische S.p.A. v High Authority of the European Coal and Steel Community [1957 and 1958] ECR 133, has already held in connexion with Article 36 of the ECSC Treaty, Article 184 of the EEC Treaty gives expression to a general principle conferring upon any party to proceedings the right to challenge, for the purpose of obtaining the annulment of a decision of direct and individual concern to that party, the validity of previous acts of the institutions which form the legal basis of the decision which is being attacked, if that party was not entitled under Article 173 of the Treaty to bring a direct action challenging those acts by which it was thus affected without having been in a position to ask that they be declared void.

40 The field of application of the said article must therefore include acts of the institutions which, although they are not in the form of a regulation, nevertheless produce similar effects and on those grounds may not be challenged under Article 173 by natural or legal persons other than Community institutions and Member States.

41 This wide interpretation of Article 184 derives from the need to provide those persons who are precluded by the second paragraph of Article 173 from instituting proceedings directly in respect of general acts with the benefit of a judicial review of them at the time when they are affected by implementing decisions which are of direct and individual concern to them.

46 In particular the applicant submits that

— The Commission excessively enlarged the category of beneficiaries intended to avail themselves of an advantage reserved for the processing industry by the basic regulation;

— The beneficiaries in this category who have bought meat from stocks held by the intervention agencies do not have to use it for a specific purpose; — There are certain irregularities as far as concerns the quantitative aspects of the rules laid down by the Commission; — Differing prices were fixed for the sale of meat from stocks held by the intervention agencies of the different Member States; — The machinery set up for implementing the system, taken as a whole, had an effect on the level of the minimum price fixed by Commission Decision 78/258.

47 The applicant's submissions dealing with procedural requirements relate, on the one hand, to a failure to give a statement of the reasons upon which several of the contested acts were based and, on the other hand, to the fact that the tenders submitted in answer to the invitation to tender organized pursuant to the provisions which are at issue were not anonymous.

48 As far as concerns the failure to give a statement of reasons an analysis of the objections shows that the applicant's submission is in fact directed against the Commission's actual justification of its introduction of the "linking" system, in the light of the provisions of the basic regulation, and the failure

JUDGMENT OF 6. 3. 1979 — CASE 92/78

53 When the Council amended Article 14 of Regulation No 805/68 by Regu­ lation No 425/77 it laid stress, in the second and fifth recitals in the preamble to the latter regulation, on the fact that the main feature of the situation on the beef and veal market at that time was a market price slump, made worse by massive imports, with the result that it was necessary to adapt certain special systems so that account might be taken of both the supplies available to the Community and the Community's needs.

54 It is for the purpose of dealing with this situation that the new Article 14 (3) (b) of Regulation No 805/68 has provided that in future imports of beef and

SIMMENTHAL v COMMISSION

veal under suspension of the levy, required for the manufacture of pure preserved beef, may be made conditional on production of a purchase contract for frozen meat held by an intervention agency.

55 As the Commission has with good reason explained, the object of this system is to achieve a reasonable balance between, on the one hand, the interest of the processing industry in importing beef and veal at world market prices and, on the other hand, the need to reduce the pressure on the market caused by the stocks held by the intervention agencies which had accu­ mulated within the Community.

56 When the Commission exercised the enabling powers conferred upon it by Regulation No 425/77 immediately after the entry into force of the new Article 14 of Regulation No 805/68 it did not have to justify once more the introduction of the "linking" system for the importation under suspension of the levy on meat intended for the manufacture of pure preserved beef seeing that the objective of this implementing measure is the same as the aim defined as clearly as anyone could wish in the Council's basic regulation.

61 This system of distribution, by limiting the tonnage of meat held by the intervention agencies which is subject to "linking" to a maximum of 100 tonnes per purchaser, pursuant to Article 3 (4) of Regulation No 2900/77, has led to many intermediaries coming into import transactions and to the creation for their benefit of profits which are unjustified and wholly unearned.

62 In the view of the Italian Government the wide definition of the category of beneficiaries of the system in question has meant that the latter no longer has any meaning and has thus reduced to nothing any kind of advantage which the Council regulation intended to give to the processing industries of the sector concerned.

63 The Commission defends itself with the submission that there was nothing to stop the meat processors from participating in the invitation to tender and from importing directly.

64 The wide definition of the category of beneficiaries by Regulation No 2900/77 takes account of the fact that many meat processors are in the habit of using commercial intermediaries for their imports.

65 Furthermore the Commission was under an obligation when it organized the system in question to abide by the principles of equal access to the goods and equality of treatment of all the potential purchasers.

66 Finally Article 11a of Regulation No 585/77, as worded in Regulation No 2901/77, expressly provided in paragraph (5) thereof that the importer shall undertake either to carry out himself the processing referred to in the basic regulation or have it carried out in his own responsibility.

72 Similarly the Commission's argument that many processors are obliged to have recourse to the import trade in order to meet their requirements is irrelevant in view of the fact that the minimum quantity accepted for the

JUDGMENT OF 6. 3. 1979 — CASE 92/78

purchase of meat from the intervention agencies is 5 tonnes with the result that even small processing undertakings are able to take advantage of the system in question and moreover other legal steps could have met all the practical requirements in such cases without excessively enlarging the category of persons benefiting from the system.

73 It should therefore be held that the Commission has prevented the special system provided for in the new Article 14 (1) (a) of Regulation No 805/68 from attaining its objective by allowing an indeterminate number of interme­ diaries to take advantage of them.

74 The applicant, with the support of the Italian Government, also submits in this context that the operation of the "linking" mechanism has been distorted by the fact that the meat bought from the intervention agencies under this system may be used by the purchaser for any purpose he likes, since it is only the meat imported free of the levy which has to be used for the preserved food industry.

75 Thus intermediaries who do not carry on business in the processing sector are able to reap a substantial part of the benefit to be derived from the suspension of the levy on imported meat by transferring that benefit to the meat from the intervention agencies which they are free to dispose of as they like.

79 Consequently the minimum price fixed by the Commission in the contested decision was considerably higher than the normal price of meat sold by intervention agencies to reduce stocks and therefore it in fact offset to an appreciable extent the advantage derived from suspending the levy as provided for in the Council regulation.

80 Thus the advantage provided for the processing industry has been switched for the benefit of an operation intended to bring about a reduction of stocks of meat held by the intervention agencies at a higher price than the price normally adopted for reducing stocks.

81 This argument has the support of the Italian Government which describes the results of the invitation to tender in question as "absurd" and points out that a system of invitations to tender which forces up prices cannot be reconciled with the objectives of the special system applicable to importing meat for processing with the suspension of the levy.

82 The Commission defends the system of invitations to tender by submitting that account had to be taken at the relevant time of a difficult situation on the Community market, characterized by surplus stocks of formidable dimensions, and that the aim of the "linking" system consists in finding a proper balance between meeting the requirements of the processing industries and taking into consideration the general market conditions within the Community, the mechanism of the invitation to tender being the best way of finding the point of equilibrium between these interests.

JUDGMENT OF 6. 3. 1979 — CASE 92/78

88 The applicant also submits in this context that the fixing by the Commission of different minimum prices for the various Member States discriminates between traders depending on where their undertakings are situate.

89 Thus, as the Commission has with good reason explained, the object of fixing differing minimum prices as set out in the annex to the contested

SIMMENTHAL v COMMISSION

decision is to take account of the regional differences, for both economic and monetary reasons, between the markets of the various Member States so as to arrive at a fair apportionment of the quantities of meat made available under the special system introduced by Article 14 of Regulation No 805/68 between the processing industries of the different regions of the Community.

90 Therefore this objection must be rejected.

Submissions based on certain features of the "linking" system relating to the quantities involved

96 However it is apparent in this case that the upper limit chosen by the .Commission had the effect, on the one hand, of causing excessive fragmentation of the import quota and on the other hand of placing large processing undertakings in a particularly unfavourable position, owing to the fact that they could only benefit to a very small extent from the opportunities for importing under the "linking" system in the form in which the Commission has organized it.

97 Consequently the applicant's objections to the exceptionally low ceiling for the tonnage which may be purchased by any one successful tenderer appear to be in principle justified.

98 On the other hand it is proper to reject the applicant's objections to the proportion of meat imported free of the levy and of meat released by intervention agencies to reduce stocks under the "linking system" fixed by the Commission as well as the criticisms of the fixing of the tonnage for which tenders were invited for the quarter which was considered and of the apportionment of the latter between the two branches of the processing industry between which a distinction is drawn in the basic regulation.

99 In fact these steps remain within the discretion in economic matters which the Commission lawfully exercises in administering the market in beef and veal, taking into account the date in the Council estimate and the quarterly estimates prepared on this basis with a view to maintaining a reasonable balance between meeting the import requirements of the processing industry and the need to dispose of stocks of beef and veal originating in the Community.

104 This must be more especially the case in these proceedings as the identification of the tenders by name is essential in order to prevent the same person submitting two or more tenders.

105 This objection must therefore be rejected.

106 For the foregoing reasons Commission Decision No 78/258 must be annulled — to the extent hereinafter stated — because it is in breach of a rule relating to the application of the Treaty, namely the new Article 14 of Regulation No 805/68, and because the Commission has misused its powers when laying down certain rules for the implementation of the "linking" system provided for by the regulation quoted.

107 For reasons of legal certainty and taking special account of the established rights of those participants in the invitation to tender whose tenders have been accepted having regard to the minimum price fixed by the Commission the annulment must be restricted to the specific decision to reject the applicant's tender which stemmed from Commission Decision No 78/258.

108 Consequently the Commission, pursuant to the first paragraph of Article 176 of the EEC Treaty, has to reconsider the particular situation of the applicant

JUDGMENT OF 6. 3. 1979 — CASE 92/78

из By an order of 22 May 1978 the President of the Court rejected the application for the adoption of interim measures made by the applicant and reserved the costs of the application.

On those grounds,

THE COURT

hereby:

1. Annuls Commission Decision No 78/258 of 15 February 1978 fixing the minimum selling prices for frozen beef put up for sale by the intervention agencies in accordance with Regulation No 2900/77 and specifying the quantities of frozen beef for processing which may be imported under special terms in the first quarter of 1978 in so far as the decision affects the applicant;

SIMMENTHAL v COMMISSION

OPINION OF MR ADVOCATE GENERAL REISCHL DELIVERED ON 24 JANUARY 1979 <apnote>1</apnote>

Mr President, held by the intervention agencies had Members of the Court, reached a certain level the suspension could be made conditional on the The common organization of the market in beef and veal (Regulation No 805/68 purchase of specific quantities of the of the Council, Official Journal, English meat stored with these agencies. Special Edition 1968 (I), p. 187), in In 1974 a market situation of crisis pro­ order to ensure the competitiveness of portions — large surpluses accumulated the processing industry and to keep it on the Community market — supplied with frozen meat provides for a necessitated the application of protective special import system — the complete or measures which were also applicable to partial suspension of the levy on imports from non-member countries. The original arrangements were such that meat intended for the manufacture of tinned corned beef could be imported without any levy and any quantitative restrictions. In the case of meat intended for the manufacture of other products the levy was totally or partially suspended as respects quantities which were to be fixed in an estimate; if stocks

1 — Translated from the German.