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Súdny dvor Európskej únie·Rozsudok·18.10.1979

C-125/78

ECLI:EU:C:1979:237

Súd
Súdny dvor Európskej únie
IČS
61978CJ0125

JUDGMENT OF 18. 10. 1979 — CASE 125/78

Moreover, even assuming that such a who has made an application under communication may be in the nature Article 3 (2) (b) of Regulation No 17, of a decision capable of being stating reasons, fixing a time-limit for contested by way of Article 173 of the the applicant to submit any Treaty, that in no way implies that comments, and explaining that the the applicant within the meaning of information obtained does not permit Article 3 (2) of Regulation No 17 is a finding of the existence of an entitled to require from the infringement of Article 85 or 86 of Commission a final decision as the EEC Treaty, constitutes a regards the existence or non-existence defining of its position under the of the alleged infringement. In fact second paragraph of Article 175 of the Commission cannot be obliged to the Treaty. continue the proceedings whatever the 3. The first subparagraph of Article 42 circumstances up to the stage of a (2) of the Rules of Procedure allows final decision. A contrary interpre­ an applicant, in exceptional circum­ tation would remove all meaning stances, to raise fresh issues in order from Article 3 of Regulation No 17 which in certain circumstances allows to support conclusions set out in the document instituting the proceedings. the Commission the opportunity of However, that provision does not in not adopting a decision to compel the any way provide for the possibility of undertakings concerned to put an end an applicant's introducing fresh to the infringement established. conclusions or, a fortiori, of 2. A letter, by which the Commission, in transforming an application on accordance with Article 6 of Regu­ grounds of failure to act into an lation No 99/63, replies to a person application for annulment.

In Case 125/78

GEMA, Gesellschaft for musikalische AUFFÜHRUNGS- und mechanische VERVIELFÄLTIGUNGSRECHTE, 29 Herzog-Wilhelm-Straße, Munich, represented by Ernest Arendt, of the Luxembourg Bar, with an address for service in Luxembourg at the Chambers of Mr Arendt, applicant, v

Commission of the European Communities , represented by its Legal Adviser, Erich Zimmermann, with an address for service in Luxembourg at the office of its Legal Adviser, Mario Cervino, Jean Monnet Building, Plateau du Kirchberg, defendant,

GEMA v COMMISSION

supported by

Compagnie Luxembourgeoise de Telediffusion S.A., represented by its Managing Director, Dr Gustave Graas, Villa Louvigny, Parc Municipal, Luxembourg, assisted by Professor Arved Deringer, with an address for service in Luxembourg at the Chambers of Jacques Loesch, Advocate, 2 Rue Goethe,

and

Radio Music International S.A.r.l., represented by its Managing Director, Dr Gustave Graas, assisted by Professor Arved Deringer, with an address for service in Luxembourg at the Chambers of the said Jacques Loesch, interveners,

APPLICATION concerning the failure of the defendant to give effect to the application made by the applicant in pursuance of Article 3 (2) (b) of Regu­ lation No 17 of the Council of 6 February 1962 (First Regulation implementing Articles 85 and 86 of the Treaty), Official Journal, English Special Edition 1959-1962, p. 87),

THE COURT

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

Advocate General: F. Capotorti Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts and Issues

I — Facts and procedure lation implementing Articles 85 and 86 Article 3 of Regulation No 17 of the of the EEC Treaty) provides in Council of 6 February 1962 (First Regu­ particular as follows:

JUDGMENT OF 18. IS. 1979 — CASK 125/78

“(1) Where the Commission, upon registered office is at Berlin- application or upon its own Wilmersdorf, initiative, finds that there is infringement of Article 85 or for infringements of Articles 85 and 86 Article 86 of the Treaty, it may by of the EEC Treaty. That complaint, decision require the undertakings which was registered by Directorate or associations of undertakings General IV of the Commission under No concerned to bring such infringe­ ment to an end. IV/26.932, concerned principally Radio Luxembourg's pra of: (2) Those entitled to make application are: — Using its subsidiary, RMI, in order to conclude with music publishers (a) Member States; established in Germany and carrying (b) natural or legal persons who on their business there joint claim a legitimate interest. publishing contracts by which the publishers grant to RMI one half of (3) ...” the royalties payable in respect of their performing rights over the According to Article 6 or Regulation No musical work published jointly in 99/63 of the Commission of 25 July on return for broadcasts in German at the hearings provided for in Article 19 favourable listening times; (1) and (2) of Council Regulation No 17 (Official Journal, English Special Edition and 1963-1964, p. 47): — Through the medium of. the "Where the Commission, having Secretary General of Radio Luxem­ received an application pursuant to bourg in association with Edition Article 3 (2) of Regulation No 17, Intro Gebrüder Meisel KG, man­ considers that on the basis of the infor­ aging a music-publishing company, mation in its possession there are Radio Tele-Music GmbH, in which insufficient grounds for granting the each of the two partners holds one application, it shall inform the applicants of its reasons and fix a time-limit for half of the capital, and whose purpose is to conclude, with other them to submit any further comments in publishers, composers and authors, writing." publishing contracts relating to By letter of 23 July 1971 the applicant, a musical works frequently broadcast German performing right association, by Radio Luxembourg in its German- submitted a complaint to the language programmes at favourable Commission in pursuance of Article 3 (2) listening times. (b) of Regulation No 17 against: 1. Compagnie Luxembourgeoise de The applicant maintained that the effect Télédiffusion S.A. (hereinafter of the practice followed by Radio Lux­ referred to as "Radio Luxembourg"), embourg and its subsidiaries of jointly whose registered office is in Luxem­ publishing pieces of light music which bourg; are broadcast frequently by Radio 2. Radio Music International S.a.r.l. Luxembourg is to obtain for Radio Luxembourg, as a member of the (hereinafter referred to as “RMI”), applicant association, increased royalties whose registered office is in Luxem­ in respect of performing rights. Since the bourg; applicant — which is the only per­ 3. Radio Tele-Music GmbH (hereinafter forming right association in Germany — referred to as "RTM"), whose has to apportion all the royalties it

GE MA \ COMMISSION

receives on the basis of a fixed scale of — Occupies a dominant position in a distribution, the result of the said substantial part of the Common practice is to put the other publishers of Market; and light music in an unfavourable position. — Abuses such a position."

By letter of 23 January 1974 the Commission sent to the aforementioned After setting out in detail the reasons on three companies in accordance with which its opinion was based the Article 19 (I) of Regulation No 17 a Commission concluded as follows: statement of the objections raised against them which concluded that there was an "For those reasons the Commission infringement of Article 86 of the Treaty. considers that a decision under Article 86 A copy of that letter was sent to the applicant. Radio Luxembourg and RMI would not be justified in the present circumstances. In accordance with replied to the statement of objections in a memorandum dated 9 April 1974. On Article 6 of Regulation No 99/63/EEC 23 April 1974 the Commission conducted the Commission allows you the oppor­ hearings of the parties. tunity of submitting in writing any comments which you may have on the foregoing within two months of receipt of this notification." By letter of 31 January 1978 the applicant called upon the Commission "to adopt a formal decision in the In that letter the Commission also inquiry into Proceedings IV/26/932 — expressed its opinion that performing Radio Luxembourg . .. within two right associations are able in other ways months of the receipt of this letter" to take precautions against the practice failing which the applicant would of certain broadcasting companies of institute against the Commission the giving preference in broadcasting to their proceedings for failure to an for which own pieces of light music. The provision is made in the second and third Commission suggested that the applicant paragraphs of Article 175 of the Treaty. should have discussions on that subject with two of its officials. Those discussions took place in Brussels on 14 In a letter dated 22 March 1978 the April 1978. The applicant was Commission informed the applicant in represented by Professor Mestmäcker particular that: and Mr Arendt. According to the applicant the discussion covered all the points raised by the Commission in its "The Commission considers that the letter of 22 March 1978. most recent information in its possession does not entitle it to grant your application in pursuance of Article 3 (2) By a telex message of 28 April 1978 the of Regulation No 17 for a decision applicant informed the Commission that recording an abuse of a dominant it considered its proposals, which position by Radio Luxembourg and the involved in particular amending the articles of association of GEMA in order other aforementioned undertakings. In the light of recent developments the to frustrate Radio Luxembourg's practice Commission considers it doubtful of concluding joint publishing contracts, whether it is possible to demonstrate to be impracticable. convincingly to the Commission and the Court of Justice of the European On 30 May 1978 the applicant lodged Communities that Radio Luxembourg: this application for failure to act against

JUDGMENT NT OF 18. 10. 1979 — CAST125 /78

the Commission, relating to its failure to 2. Call upon the Commission to adopt a comply with the application made by the formal decision in Proceedings IV/­ applicant on 23 July 1971 in pursuance 26.932 or, if appropriate, to inform of Article 3 (2) of Regulation No 17. the applicant of their discontinuance in accordance with the provisions of The application was received at the Article 6 of Regulation No 99/63 Court Registry on 31 May 1978. within two months of the date of the It should be noted that the applicant judgment to be given by the Court of lodged an application before the Land­ Justice; gericht Köln [Cologne Regional Ct rt] 3. State that if the Commission fails to based on Article 1 of the Law against unfair competition in conjunction with observe the terms of the operative Articles 85 and 86 of the Treaty with the part of the judgment to be given its aim of prohibiting Radio Luxembourg conduct is contrary to the EEC from concluding joint publishing Treaty; contracts. Following the dismissal of the 4. Order the Commission to pay the application by the Landgericht (1972) costs. and dismissal of the applicant's appeal bv the Kartellsenat [division dealing with In its defence the Commission contends competition matters] of the Oberlandes­ that the Court should dismiss the gericht [Higher Regional Court] Dusseldorf (1973) the applicant brought application as inadmissible or, in the alternative, as unfounded and order the an appeal on a point of law against the latter judgment before the Bundes­ applicant to pay the costs. gerichtshof [Federal Court of Justice]. In its reply the applicant adheres to the On 7 December 1978 Radio Luxem­ conclusions in its application. bourg and RMI applied to the Court for In its rejoinder the Commission contends permission to intervene in the present that the Court should dismiss the proceedings in support of the sub­ missions of the Commission whilst application as inadmissible or, in the alternative, as unfounded and order the waiving the right to submit observations applicant to pay the costs. during the written procedure. By order of 17 January 1979 the Court allowed Radio Luxembourg and RMI to III — Submissions and argu­ intervene to the extent desired. ments of the parties Upon hearing the report of the Judge- Rapporteur and the views of the According to' the applicant the Advocate General the Court decided in Commission was duly called upon to act accordance with Article 92 of the Rules by letter dated 31 January 1978 in of Procedure to open the oral procedure accordance with the provisions of the as regards the sole question of the second paragraph of Article 175 of the admissibility of the application without Treaty. The Commission did not define holding any preparatory inquiry. its position within two months of being so called upon. This application was lodged' within two months of the expiry II — Conclusions of the parties of that time-limit.

Proceedings for failure to act are open to In its application the applicant claims that the Court should: any natural or legal person when an institution of the Community has "failed 1. Declare that the Commission's failure to address to that person any act other to act is wrongful; than a recommendation or an opinion".

GEMA COMMISSION

In this instance the Commission had a failure to take a decision is an duty to act and the measure sought is "infringement of the Treaty" (first capable of producing definitive legal paragraph of Article 175) the application effects and is neither an opinion nor a does not state "the grounds on which the recommendation. application is based" as required bv Article 38 (I) (c) of the Rules of The application is therefore admissible. Procedure. Secondly, the application is The inaction on the part of the inadmissible because there is no failure

Commission may be considered from to act on the part of the Commission. To two aspects. First, the Commission failed support that argument the Commission to continue the proceedings which it had observes that in its judgment in Case instituted on the basis of Regulation No 8/71 (Deutscher Komponistenverband e.V. 17. Secondly, it failed to inform the v Commission of the European applicant of the shelving of its complaint Communities, [1971] ECR 705) the as required by Article 6 of Regulation Court declared (in paragraph 2, p. 710) No 99/63. that Article 175 "refers to failure to act in the sense of failure to take a decision It is consistently accepted in academic or to define a position". If the writing on Community law that Article 6 Commission has defined its position of Regulation No 99/63 implies that the within the period fixed by Article 175 complainant may bring proceedings for "the conditions for application of that failure to act against the failure of the article are not satisfied" (judgment in Commission to pursue its complaint Case 42/71, Nordgetreide GmbH & Co. (Megret, Louis, Vignes, Waelbroeck: Le KG v Commission of the European Droit de la Communauté Économique Communities, [1972] I ECR 105 at p. Europeenne, Vol. 4, No 78, p. 118, 110, paragraph 4). Goldman: Droit Commercial Europeen, No 360, Braun, Gleiss, Hirsch: Droit des The Commission recollects that it was Ententes de la Communaute Econo­ called upon to act on 31 January 1978. It mique Europeenne, No 130, Steindorff, defined its position on the complaint in A.W.D. 1963, 353; Deringer, Das its letter of 22 March 1978, that is, Wettbewerbsrecht der Europaischen within the period of two months fixed in Gemeinschaft, Article 3, Regulation No the second paragraph of Article 175. In 17, Note 3). that letter the Commission explained to the applicant in accordance with Article In its defence the Commission observes 6 of Regulation No 99/63 the reasons chiefly, as regards the facts, that for its opinion that on the basis of the although invited by the Commission to information which it had obtained there comment on its letter of 22 March 1978 were insufficient grounds for granting its the applicant failed to do so. application in pursuance of Article 3 (2) After observing that it is difficult to of Regulation No 17. reconcile the two aspects of the alleged The decision of which the applicant was inaction referred to by the applicant the entitled to receive notification if the Commission puts forward two arguments Commission considered that it was intended to show that the application is inadmissible. unable to grant its application is clearly that referred to in Article 6 of Regu­ First, it maintains that as, in its lation No 99/63. Since it defined its application to the Court, the applicant position within the period of two months did not set out the grounds on which it the Commission considers that the believes that the Commission's alleged application is inadmissible.

JUDGMENT or 18. 10. 1979 — CASE 125/78

In the reply the applicant maintains that because possible means of solving the by refusing to establish the existence of problem other than those suggested by an infringement of Article 86 of the the Commission in the aforementioned Treaty and to adopt the measures letter were considered in detail during necessary to put an end to it the the discussions. Commission contradicts its own findings . and assessments of the legal position By a telex message of 28 April 1978 the made in its statement of the objections applicant informed the Commission that raised by the applicant. To support that it considered the proposals relating to argument the applicant cites various the amendment of its articles of passages in the statement of objections association to be impracticable. and concludes therefrom that for reasons of substantive law it has a legitimate interest in the cessation of an It is therefore incorrect that the applicant infringement of the rules on competition. failed to comply with the invitation to submit its comments on the Commission's letter of 22 March 1978. In reliance upon academic legal writings The applicant expressed its views on that on Article 3 (2) of Regulation No 17 (in subject during the discussions and in the particular Thiesing, Kommentar zum telex message referred to above. EWG-Vertrag, 2nd edition 1974, Article 3 of Regulation No 17, Note 27) the applicant maintains that its right consists The applicant also observes that it stated in obtaining, first, a finding that such an in the telex message that it was appro infringement exists and, secondly, its priate to leave the application on the

cessation. In the context of the right to grounds of failure to act and the action make an application in pursuance of for termination of the infringement Article 3 of Regulation No 17, defining brought against Radio Luxembourg a position within the meaning of the before the Bundesgerichtshof to proceed second paragraph of Article 175 of the simultaneously. Treaty does not mean simply adopting any attitude whatever but rather involves Finally, the applicant emphasizes the taking action imposed by the rules on fundamental importance for the competition and consistent administrative application of the rules on competition in

practice. The Commission's letter of 22 the Common Market of the questions of March 1978 does not satisfy those law which arise in this instance. The requirements for the reasons of sub administrative practice followed by the stantive law referred to by the applicant. Commission in the present case is such as to make impossible in practice The applicant refers to the discussions cooperation of citizens and national which took place on 14 April 1978 and courts in observing the rules on maintains that having regard to their competition. In particular no national very context they were intended to allow court which wishes to afford legal consideration of all the points raised by protection to those subject to the Commission in its letter of 22 March jurisdiction is able any longer to suspend

1978. The applicant was informed of the the proceedings pending adoption of 2 subject-matter of the discussions in a decision by the Commission if that body report by Professor Mestmäcker, who allows the matter to rest for more than represented the applicant with Mr three years before avoiding an action for Arendt. That report, a copy of which is failure to act by relying on grounds annexed to the reply, was necessary which are contrary to the rules of law on

GEMA \ COMMISSION

the basis of which the proceedings have January 1978 the applicant was entitled taken place until then. The Court of to have that information communicated Justice is alone in a position to avert to it. In the Commission's opinion that such consequences by affording effective communication was an "act" within the legal protection by way of Article 3 (2) meaning of the second paragraph of of Regulation No 17. Article 175 which, if it had not been adopted within the prescribed period, In its rejoinder the Commission claims might have justified the bringing of an that the contradictions referred to by the action for failure to act by the applicant applicant do not exist. After carrying out (cf.

Roemer, Die Untatigkeitsklage im a searching inquiry and implementing the Recht der Europaischen Gemeinschaft, administrative procedure the Com S.E_W_, 1966, p. 13). mission became convinced that it would be impossible as things stand to prove the If, in accordance with what is accepted existence of a dominant position held by by academic legal writers, Article 3 (2) Radio Luxembourg and its subsidiaries of Regulation No 17 entitles an applicant RMI and RTM within the meaning of to action on the part of the Commission,

Article 86. In order to make the true it must nevertheless be observed that the situation more readily comprehensible it existence of such a right does not entitle gives a detailed description of the course the applicant in the present case to of the administrative procedure. conclude that it includes that of having the infringement established and After becoming convinced, following the terminated (cf. Steindorff, Das Antrags recht im EWG-Kartellverfahren and implementation of the administrative procedure, that it was unable to grant seine prozessuale Durchsetzung, Außen- wirtschaftsdienst des Betriebsberaters

the applicant's application because it considered it impossible to demonstrate 1963, p. 357). that Radio Luxembourg had infringed Article 86 of the Treaty the Commission Finally, the Commission gives its views, was unable to do anything other than even though it considers them to be communicate that information to the irrelevant for the purpose of the applicant within the period allowed as judgment to be given by the Court — on required in Article 6 of Regulation No the applicant's contention that it is 99/63 which prescribes in imperative deprived of all effective legal protection terms the action to be taken by the if the action for failure to act in the Commission when it considers that the present instance is not successful. information which it has obtained does not entitle it to comply with the In that connexion the question of application made in pursuance of Article fundamental importance which arises

3 (2) of Regulation No 17. The and which has not yet received any reply Commission was therefore unable to is whether, if his application is dismissed react to the applicant's letter of 31 by the Commission, an applicant within January 1978 in any different way. the meaning of Article 3 (2) of Regu lation No 17 is entitled to require a At the stage of the procedure in question decision to be adopted which he will be Article 6 of Regulation No 99/63 in fact able to contest by proceedings brought fixes the legal position of the applicant by way of the second paragraph of with regard to Article 3 (2) of Regu Article 173 of the Treaty when the

lation No 17. Having called upon the Commission does not adopt any positive Commission to act by letter of 31 decision directed against a third party.

JUDGME NT OF 18. 10. 1979 — CASE 1 125/78

The Commission envisages three possible If it is accepted that the principle aim of solutions but immediately rejects the the right to make application to the third on the ground of the considerable Commission conferred by Article 3 (2) of additional burden of work which it Regulation No 17 is to grant to persons would involve for the department of the and associations of persons a right whose Commission responsible for observance existence may be subject to review by the of the rules governing competition: court, the solution indicated under point 2 must be seriously considered (cf. in

1. The proceedings based upon Article 3 particular Mertens de Wilmars, Adminis (2) of Regulation No 17 are tratieve Procedure en Rechtswaarborgen exhausted by the communication in EEC Kartelzaken, Europese Kartel provided for in Article 6 of Regu recht, pp. 240 and 241, Waelbroeck, op. lation No 99/63. There is no right of cit. Vol. 4, p. 118).

The communication recourse to the Court against that referred to under Article 6 of Regulation communication. No 99/63 may be regarded as a decision, 2. The communication referred to in since it has legal consequences as regards the applicant. When the Commission Article 6 of Regulation No 99/63 indicates the reasons which prevent it constitutes a decision capable of being from granting the application that is contested by the applicant by ordinarily to be regarded as a final proceedings based upon Article 173. definition of its position. The fact that

3. The communication is not final. The Article 6 of Regulation No 99/63 Commission is bound to dismiss the provides for the applicant to be allowed application by means of a formal a period in which to submit any further decision adopted after communication comments in writing does not prevent of the reasons on which it is based in the communication from constituting a accordance with Article 6 of Regu decision. That provision allows the lation No 99/63. That decision may applicant to decide whether he wishes to submit further comments on the be contested by proceedings instituted on the basis of the second paragraph communication. If he fails to do so, he of Article 173. accepts the definitive nature of the

communication. If he makes use of his right to submit further comments and if According to the Commission the the Commission informs him that it solution envisaged under point 1 may be adheres to its opinion the communication contemplated without the slightest referred to in Article 6 of Regulation No difficulty. The Community legislature 99/63 in that case also constitutes a would not leave applicants without rejection of the application. protection if recourse to the Court of Justice was impossible following If the solution referred to under point 1 dismissal of their application by the is adopted the applicant no longer has

Commission. The prohibitions contained any right on which he may rely in order in Articles 85 and 86 are directly to obtain the adoption of the decision applicable rules of Community law. which results from Article 6 of Regu Applicants may institute proceedings lation No 99/63. That decision has before the national courts for the already been adopted. cessation of the infringement and, if appropriate, for compensation. If they If it appears necessary to adopt the consider that a wrongful act or omission solution suggested under point 2, then exists on the part of the defendant they the applicant was able to contest the may seek reparation for any damage communication of 22 March 1978 caused in accordance with Article 215 of referred to in Article 6 of Regulation No the Treaty. 99/63 by means of an application for

GEMA \ COMMISSION

annulment based on the second the proceedings instituted against Radio paragraph of Article 173 of the Treaty. Luxembourg contained in the Com­ If the solution adopted is that referred to mission's letter to the applicant of 22 under point 3, the applicant is entitled to March 1978 (second paragraph of Article have the defendant adopt a formal 173 of the EEC Treaty)." decision rejecting his application. The applicant states that that application In none of the aforementioned cases for annulment is based upon Article 86 have the proceedings for failure to act of the Treaty and Article 3 (2) of Regu­ lation No 17 of the Council. It is brought by the applicant any chance of succeeding, since the Commission therefore based upon the same facts as "defined its position" within the period those already set out by the applicant for prescribed. In the first case the applicant the purpose of the proceedings directed is not entitled to have a fresh decision against the Commission's failure to act. adopted. In the second and third cases In support of its alternative claim the the prevailing principle is that by which, applicant refers to the judgment of the within the system of legal protection Bundesgerichtshof of 12 December 1978, provided for by the Treaty, proceedings which, together with the grounds of for annulment and for failure to act are judgment, had been communicated to it alternatives to one another. That means on 20 February 1979, in the action that if proceedings for annulment are brought by the applicant against Radio brought it is no longer possible to bring Luxembourg, RMI and RTM. That proceedings for failure to act. In the judgment rejected the applicant's third case the applicant may — after the conclusions inasmuch as it sought an dismissal of the application which forms order that Radio Luxembourg should the subject of the present action — bring refrain "from concluding and/or causing fresh proceedings against the Com­ to be concluded joint publishing mission in order to obtain a formal contracts with music publishers whose decision. If the Commission adopts the registered place of business is in the decision requested the applicant may Federal Republic of Germany including contest it under the second paragraph of West Berlin and/or from establishing Article 173. If the Commission does not with such publishers joint publishing adopt the said decision within two houses the purpose or result of which is months of the date on which proceedings to ensure that in the German-language are brought the applicant may bring programmes broadcast by Radio Luxem­ fresh proceedings under Article 175. bourg preference is given to the musical The Commission therefore adheres to its works published jointly". conclusions in favour of the dismissal of the application as inadmissible. The admissibility of the alternative application

IV — Additional conclusions sub­ The applicant observes that no appeal lies from the judgment of the Bundes­ mitted by the applicant gerichtshof. By virtue of the third paragraph of Article 177 of the Treaty On 19 March 1979 the applicant that court was required to ask the Court submitted in the alternative, the of Justice to rule on questions of following additional conclusions to the Community law. Without expressing any effect that the Court should: opinion on the material content of "If the application is declared Articles 85 and 86 the Bundesgerichtshof inadmissible inasmuch as it refers to the decided not to refer the matter to the failure of the Commission to act, declare Court. In the statement of the facts in null and void the decision not to pursue the judgment the Bundesgerichtshof

JU DG MENT OF 18 12 1979 — CASE 1 25/78

indicated that it had regarded the itself a right to lodge an application for Commission's letter of 22 March 1978 as annulment outside the period prescribed a decision putting an end to the by the second paragraph of Article 173. proceedings. As a result of that assessment of the facts the applicant is The legal arguments put forward by the deprived of any remedy before the Court applicant to support its submissions did of Justice if that body accepts that the not come to light for the first time in the Commission has not remained inactive course of the written procedure. The and has put an end to the proceedings by applicant was in possession of the means of the decision addressed to the Commission's letter of 22 March 1978 applicant. That is why the applicant is before the present proceedings were lodging the alternative claim. instituted. The possible classification of that letter as a decision open to contest The applicant states that it bases its ought to have led a prudent applicant to application on the first subparagraph of lodge an application for annulment as either a main action or in the alternative. Article 42 (2) of the Rules of Procedure of the Court. It considers that the matters of law on which the application The conduct of the Bundesgerichtshof is based came to light only on the expiry does not constitute a fresh issue which

of the written procedure. It claims that it came to light in the course of the written has observed the period prescribed in the procedure before the Court. Even third paragraph of Article 173 of the assuming that the Bundesgerichtshof did Treaty. regard the letter of 22 March 1978 as a decision by the Commission putting an The Commission claims that the end to the proceedings which it had instituted the legal reasons for such a application is inadmissible. point of view were already in existence before the present application was The applicant bases its application on lodged. Article 42 (2) of the Rules of Procedure according to which "No fresh issue may The refusal of the Bundesgerichtshof to be raised in the course of proceedings". refer to the Court of Justice preliminary An exception is provided for as regards questions on the interpretation of cases in which such issue "is based on Articles 85 and 86 by virtue of Article matters of law or of fact which come to 177 of the Treaty is not the cause of the light in the course of the written lack of access to the Court of which the procedure". According to the second applicant complains. In fact, the Court subparagraph of that provision, such could only have "interpreted" the fresh issues may be raised "in the course questions of law referred to it. The of the written procedure". applicant is attempting to obtain a decision on the substance from the Court

In fact the applicant is not raising any by means of additional conclusions. fresh issues in support of its submissions based upon Article 175 of the Treaty but In any event, the applicant submitted its is rather seeking to put forward fresh application only after the closure of the submissions based upon the second written procedure by the lodging of the paragraph of Article 173, which is not Commission's rejoinder of 3 November contemplated by the provisions of Article 1978, that is, outside the period pre­ 42 (2) of the Ruls of Procedure. The scribed by Article 42 of the Rules of applicant is in fact seeking to create for Procedure.

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V — Oral procedure Erich Zimmermann, presented oral argument at the hearing on 20 June 1979.

The applicant, represented by Ernest Arendt, of the Luxembourg Bar, and the The Advocate General delivered his defendant, represented by its Agent, opinion at the hearing on 11 July 1979.

Decision

1 The dispute in these proceedings arises out of a letter dated 23 July 1971 by which the applicant, GEMA, a German performing right association, submitted a complaint to the Commission in pursuance of Article 3 (2) (b) of Regulation No 17 of 6 February 1962 (Official Journal, English Special Edition 1959-1962, p. 87) the aim of which was to establish the existence of infringements of the rules on competition laid down in Articles 85 and 86 of the EEC Treaty by the Compagnie Luxembourgeoise de Télédiffusion (hereinafter referred to as "Radio Luxembourg"), its subsidiary, Radio Music International (hereinafter referred to as "RMI"), both of which have registered offices in Luxembourg, and Radio Tele-Music (hereinafter referred to as "RTM"), whose registered office is in Berlin-Wilmersdorf.

2 According to the terms of that complaint Radio Luxembourg concluded contracts through RMI with publishers of light music established in the Federal Republic of Germany and carrying on their business there, by which RMI receives one half of the royalties due in respect of the performing rights over the musical works published jointly by RMI and the said publishers in return for the frequent broadcasting of those compositions in German on Radio Luxembourg at favourable listening times. The effect of that practice is to obtain for Radio Luxembourg, as a member of GEMA, excessive royalties in respect of performing rights. Since the applicant — which is the only performing right association in the Federal Republic — has to apportion all the royalties which it receives on the basis of a fixed scale of distribution, the result of the said practice is to put the other publishers of light music, who are also members of the applicant association, in an unfavourable position.

3 The Commission complied with the terms of the applicant's complaint on 23 January 1974 by sending to the aforementioned three companies a letter

JUDGMENT OF 18. 10. 1979 — CASE 125/78

containing a statement of the objections raised against them in accordance with Article 19 (1) of Regulation No 17. On 23 April 1974 the Commission conducted hearings of the parties but did not inform the applicant of the subsequent course of the proceedings.

4 By letter of 31 January 1978 the applicant called upon the Commission to adopt "a formal decision in the inquiry into the proceedings" within two months failing which the applicant would lodge against the Commission an application for failure to act, in accordance with Article 175 of the Treaty.

5 The Commission replied by letter of 22 March 1978 in which it expressed the view that "the most recent information" in its possession did not entitle it to grant the applicant's application for a decision recording an abuse of a dominant position by Radio Luxembourg and the other aforementioned undertakings. In the light of recent developments in the situation the Commission considered it doubtful whether it was possible to demonstrate convincingly that Radio Luxembourg occupied a dominant position in a substantial part of the Common Market and abused such a position. After setting out in detail the reasons for that opinion the Commission concluded that a decision by way of Article 86 of the Treaty would not be justified. In accordance with Article 6 of Regulation No 99/63 of the Commission of 25 July 1963 on the hearings provided for in Article 19 (1) and (2) of Council Regulation No 17 (Official Journal, English Special Edition 1963- 1964, p. 47) the Commission allowed the applicant the opportunity of submitting any further comments within two months of receipt of "this notification".

6 In the aforementioned letter the Commission also expressed its opinion that associations for the protection of performing rights were able in other ways to take precautions against distortions of competition resulting from the practice of certain broadcasting companies of giving preference in broad­ casting to pieces of light music over which they had certain rights of ownership. The Commission suggested that the applicant should have discussions on that subject with certain of its officials. During those discussions which took place on 14 April 1978 and which, according to the applicant, covered all the points raised by the Commission in its letter of 22 March 1978, the Commission submitted proposals involving in particular amendment of the articles of association of GEMA in order to frustrate Radio Luxembourg's practice of arranging for joint publication. However, by

GEMA V COMMISSION

a telex message of 28 April 1978 the applicant informed the Commission that it considered its proposals to be impracticable.

7 On 31 May 1978 the applicant lodged an application under Article 175 of the Treaty, seeking to establish the illegality of the Commission's failure to act and to call upon it either to adopt a formal decision within the context of the proceedings instituted in 1971 following the applicant's complaint or, if appropriate, to inform the applicant of the discontinuance of the proceedings, in pursuance of Article 6 of Regulation No 99/63. The applicant claims that the letter of 22 March 1978 did not constitute per­ formance by the Commission of its obligations under Article 3 (2) of Regu­ lation No 17 since the applicant is "entitled ... to have . . . the Commission continue the proceedings instituted against Radio Luxembourg, establish the existence of the infringement and prescribe the measures necessary in order to put an end to it".

8 By order of 17 January 1979 the Court allowed Radio Luxembourg and RMI to intervene in support of the submissions of the Commission.

9 On 19 March 1979 the applicant submitted in the alternative certain additional conclusions which, in case the Court should consider the application for failure to act to be inadmissible, sought, by way of the second paragraph of Article 173 of the Treaty, the annulment of the decision not to continue with the proceedings instituted against Radio Luxembourg contained in the Commission's letter of 22 March 1978.

Admissibility

10 The Commission contests the admissibility of the application for failure to act on the ground that the conditions for the application of Article 175 are not satisfied.

11 The Commission observes that the second paragraph of Article 175 requires it not to have "defined its position" within two months of being called upon to act and claims that there is no failure to act in this instance since its letter of 22 March 1978 constitutes a definition of its position within the meaning of Article 175. That statement is in turn challenged by the applicant who claims, first, that the letter of 22 March is purely interlocutory in nature and, secondly, that as a private applicant making an application by way of

JUDGMENT OF 18. 10. 1979 — CASE 125/78

Article 3 (2) of Regulation No 17 it is entitled to a "decision" within the meaning of Article 189 of the Treaty. The Commission claims, furthermore, that as the decision demanded by the applicant could not have been addressed to it but only to the undertakings whose conduct was called in question by the complaint the applicant does not fall within the category of natural or legal persons who, under the terms of the third paragraph of Article 175, may complain to the Court.

12 The Commission also contests the admissibility of the applicant's alternative application. The applicant bases that alternative application upon Article 42 (2) of the Rules of Procedure according to which no "fresh issue" may be raised "in the course of proceedings" unless it "is based on matters of law or of fact which come to light in the course of the written procedure". The Commission claims, however, that that application does not raise any fresh issue but rather puts forward fresh conclusions. In any event, the application is inadmissible since it was submitted after the expiry of the period prescribed by the final paragraph of Article 173.

13 It is therefore necessary to consider the admissibility of both the application for failure to act and the alternative application.

A — The application for failure to act

14 It is necessary to decide, first, whether the letter of 22 March 1978 constitutes defining a position within the meaning of the second paragraph of Article 175. To that end it is first necessary to consider the Commission's obligations within the context of the procedure laid down by Regulation No 17 and supplemented by Regulation No 99/63 for the purpose of establishing possible infringements of Articles 85 and 86 of the Treaty.

15 Article 3 of Regulation No 17 provides in particular as follows:

"(1) Where the Commission, upon application or upon its own initiative, finds that there is infringement of Article 85 or Article 86 of the Treaty, it may by decision require the undertakings or associations of under­ takings concerned to bring such infringement to an end.

GEMA v COMMISSION

(2) Those entitled to make application are:

(a) Member States;

(b) natural or legal persons who claim a legitimate interest."

16 Article 6 of Regulation No 99/63 provides that:

"Where the Commission, having received an application pursuant to Article 3 (2) of Regulation No 17, considers that on the basis of the information in its possession there are insufficient grounds for granting the application, it shall inform the applicants of its reasons and fix a time-limit for them to submit any further comments in writing."

17 As is shown by the phrase "... shall inform the applicants of its reasons", it follows that the communication referred to in Article 6 of Regulation No 99/63 only seeks to ensure that an applicant within the meaning of Article 3 (2) (b) of Regulation No 17 be informed of the reasons which have led the Commission to conclude that on the basis of the information obtained in the course of the inquiry there are insufficient grounds for granting the application. Such a communication implies the discontinuance of the proceedings without, however, preventing the Commission from re-opening the file if it considers it advisable, in particular where, within the period allowed by the Commission for that purpose in accordance with the provisions of Article 6, the applicant puts forward fresh elements of law or of fact. The applicant's argument that an applicant under Article 3 (2) of Regu­ lation No 17 is entitled to obtain from the Commission a decision within the meaning of Article 189 of the Treaty on the existence of the alleged infringement cannot, therefore, be accepted.

18 Moreover, even assuming that such a communication is in the nature of a decision within the meaning of Article 189 of the Treaty and that it is therefore capable of being contested by way of Article 173 of the Treaty, that in no way implies that the applicant within the meaning of Article 3 (2) of Regulation No 17 is entitled to require from the Commission a final decision as regards the existence or non-existence of the alleged infringement. In fact the Commission cannot be obliged to continue the proceedings whatever the circumstances up to the stage of a final decision. The interpretation put forward by the applicant would remove all meaning

JUDGMENT OF IS. 10. 1979 — CASI 125/78

from Article 3 of Regulation No 17 which in certain circumstances allows the Commission the opportunity of not adopting a decision to compel the undertakings concerned to put an end to the infringement established. It therefore follows from the nature of the procedure to establish an infringement laid down by Article 3 of the regulation that it cannot be accepted that a natural or legal person who, in pursuance of Article 3 (2) (b) of the regulation, has requested the Commission to establish the said infringement, is entitled to demand a final decision on the proceedings instituted by the Commission following his complaint.

19 As regards the letter of 22 March 1978 it must be noted that the Commission informed the applicant of its view that a decision by way of Article 86 of the Treaty would not be justified and set out the facts and reasons on which that opinion was based. In addition, in accordance with the provisions of Article 6 of the aforementioned Regulation No 99/63 it fixed a time-limit of two months for the submission by the applicant of any further comments in writing.

22 It follows that the Commission acted in accordance with the aforementioned provisions of Article 6 of Regulation No 99/63 by informing the applicant of the outcome of the proceedings and of the reasons for the discontinuance of the inquiry into its complaint. It must be added that it emerges from the terms of the letter, which is in two separate sections, that the Commission's suggestion for discussions with the applicant in order to examine other suitable methods of dealing with the consequences of the practices called in question by it falls outside the scope of the procedure to establish an infringement of the rules on competition instituted by the Commission following the submission of the original complaint. Contrary to the argument put forward by the applicant that suggestion cannot therefore confer on the letter an interlocutory character.

21 It results from the foregoing considerations that by replying by means of the letter of 22 March 1978, which was in accordance with the requirements of Article 6 of Regulation No 99/63, to the applicant's letter of 31 January 1978 calling upon it to act, the Commission addressed to the applicant an act which constitutes a definition of its position within the meaning of the second paragraph of Article 175 of the Treaty.

22 It follows that in this instance the Commission has not failed to act on the applicant's application to it and that the circumstances contemplated by Article 175 are not present.

23 The application on the grounds of failure to act must therefore be dismissed as inadmissible.

GEMA v COMMISSION

B — The application for annulment

24 As has already been stated the applicant lodged supplementary conclusions on 19 March 1979 seeking the annulment of "the decision not to pursue the proceedings instituted against Radio Luxembourg contained in the Commission's letter to the applicant of 22 March 1978 (second paragraph of Article 173 of the EEC Treaty)". In support of its application the applicant states that it is based upon the same facts as those already referred to for the purposes of the application for failure to act. It also claims that its application constitutes the raising of a fresh issue based on matters of law which came to light only at the end of the written procedure and that it is therefore admissible by virtue of the first subparagraph of Article 42 (2) of the Rules of Procedure.

25 The matter of law referred to by the applicant is the communication to it on 20 February 1979 of the grounds for the judgment given by the Bundes­ gerichtshof on 12 December 1978 in an action between the applicant and Radio Luxembourg, RMI and RTM which concerned the same facts as those which form the basis of the proceedings instituted by the Commission against those companies. It may be seen from that judgment that the Bundes­ gerichtshof states, in particular, that the Commission has ceased to pursue those proceedings. According to the applicant the Bundesgerichtshof had regarded the Commission's letter of 22 March 1978 as a decision putting an end to the proceedings. The applicant has lodged the alternative application for annulment in case the Court shares that opinion.

26 The first subparagraph of Article 42 (2) of the Rules of Procedure states that: "No fresh issue may be raised in the course of proceedings unless it is based on matters of law or of fact which come to light in the course of the written procedure". That provision therefore allows an applicant, in exceptional circumstances, to raise fresh issues in order to support conclusions set out in the document instituting the proceedings. It does not in any way provide for the possibility of an applicant's introducing fresh conclusions or, a fortiori, of transforming an application on grounds of failure to act into an application for annulment. In this instance the conclusions in the originating application were based on Article 175 of the Treaty whilst those in the additional application relate to the existence of an act which may be contested by virtue of Article 173. The applicant cannot therefore rely on the provisions referred to above in order to show the admissibility of its application for the annulment of any decision contained in the Commission's letter of 22 March 1978.

JUDGME N T OF 18. 10. 1979 _ CASE 125/78

27 The alternative application for annulment must therefore be dismissed as inadmissible.

Costs

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

29 As the applicant has failed in its submissions it must be ordered to pay the costs with the exception of those which may have been incurred as a result of the intervention of Radio Luxembourg and RMI in respect of which, in accordance with Article 69 (3) of the Rules of Procedure the applicant and the interveners, who have not submitted any written or oral observations, must each bear their own costs.

On those grounds.

THE COURT

hereby:

1. Dismisses the application as inadmissible;

2. Orders the applicant to pay the costs with the exception of those which may have been incurred as a result of the intervention, in respect of which the applicant and the interveners must each bear their own costs.

Kutscher O'Keeffe Touffait

Mertens de Wilmars Pescatore Mackenzie Stuart Bosco

Delivered in open court in Luxembourg on 18 October 1979.

A. Van Houtte H. Kutscher

Registrar President

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Rozsudok C-125/78 – Súdny dvor Európskej únie | AI Pravnik