C-799/79

(2) COUNCIL OF THE EUROPEAN COMMUNITIES, represented by its Legal Adviser, J. Carbery, acting as Agent, with an address for service in Luxembourg at the office of D. Fontein, Director of the Legal Department of the European Investment Bank, Kirchberg,

defendants,

APPLICATION in the terms set out in the pleadings,

T H E COURT (First Chamber)

composed of: G. Bosco, President of Chamber, A. O'Keeffe and T. Koopmans, Judges,

Advocate General: F. Capotorti Registrar: J. A. Pompe, Deputy Registrar

1. Background provisions After the collapse in 1971 of the inter­ national system of fixed exchange rates, which is at the heart of those provisions, This case should be seen against the the parities came to reflect less and less background of the following provisions: the purchasing power of the currencies involved and their value on the inter­ (a) In the version in force until 31 national money market. Officials who March 1979, Article 63 of the Staff made transfers to countries the value of Regulations of Officials provided that: whose currency had increased in relation to the parities notified to the Inter­ "An official's remuneration shall be national Monetary Fund were thus able expressed in Belgian francs. to realize gains on the exchange rate, as compared with transfers made in normal It shall be paid in the currency of the market conditions. country in which the official performs his duties. In accordance with the legal position existing prior to 1 April 1979 the Remuneration paid in a currency other weighting provided for in Article 64 of than Belgian francs shall be calculated on the Staff Regulations to reflect the living the basis of the par values accepted by standards at the place where the official the International Monetary Fund, and in performed his duties had to be applied to force on 1 January 1965." the whole of the remuneration including the part to be transferred to another The relevant parity was BFR 12.50 to country pursuant to Article 17 of Annex DM 1 and BFR 8 to LIT 100. VII. This led to an increase in the weighting for officials assigned to In accordance with Article 17 of Annex countries such as Italy where the value of VII to the Staff Regulations, an official the currency had decreased in relation to may have part of his emoluments the parities notified to the International transferred, either regularly or on an Monetary Fund and to a reduction in exceptional basis, to a country other than the weighting for officials assigned to the one in which he performs his duties. countries whose currency had gained in Until 31 March 1979 Article 17 (4) value in relation to the parities of the provided that such transfers were to be Fund. However, the applicant maintains

that the increase made in the weighting "Transfers provided for in paragraphs was very slight. For example, the (2) and (3) shall be made on the basis of weighting for Italy was increased, in the par values referred to in the last figures, from 100 to 146.9, whereas the paragraph of Article 63 of the Staff exchange rate had fallen from LIT 12.5 Regulations; the amounts transferred for BFR 1 to LIT 28 for BFR 1. shall be multiplied by a coefficient representing the difference between the weighting for the country in whose currency the transfer is made and the weighting for the country in which the official is employed." Pensioners were able to derive special advantages from these provisions. If they declared their domicile to be in a country whose currency had diminished in value, the weighting in respect of that On 1 April 1977 the Commission country was applied to their pension in submitted to the Council a proposal for a accordance with Article 82 (1) of the Council regulation introducing the Staff Regulations. Article 45 of Annex European unit of account (EUA) into the VIII to the Staff Regulations gave them Staff Regulations of Officials (Official the opportunity of having their pensions Journal C 99, p. 5). That proposal was paid in the strong currency of their rejected by the Staff Regulations country of origin or of that of the seat of Committee to which it had been the institution to which they belonged. referred. The Council obtained the This state of affairs was condemned by opinion of the European Parliament and Mr Advocate General Mayras in his of the Court of Justice. By resolution of opinion in Case 28/74 (Gillet, [1975] 7 July 1977 (Official Journal C 183, ECR 475). p. 55) the Parliament approved the proposal taking note of "the Com- mission's assurance that its proposal will in no way affect the real value of the payments made to officials in the form of remuneration, pensions and allowances". From 1974 onwards the Commission has At the sitting the Commissioner submitted proposals to the Council with responsible for administration, Mr a view to abolishing the anomalies in the Tugendhat, stated: "The object of the rules governing the payment of remuner- Commission's system is financial ation and pensions brought about by the neutrality, and what we think that our breakdown in the international system of system can achieve is an equality of fixed exchange rates. purchasing power. What we want is that a Commission official of a given grade, whether he is working in Brussels or Luxembourg or London or any other part of the Community, should be able The proposal for a Council regulation to buy exactly the same quantity of amending the Staff Regulations of goods as his equal in another part of the Officials, submitted to the Council by Community . . . The problem of transfers the Commission on 13 June 1974 is also one that has preoccupied the (Official Journal C 88, p. 25) provided Commission. There is a proposal for an for an amended version of Article 17 (4) amendment of the Staff Regulations now of Annex VII to the Staff Regulations as under consideration. In our view, that follows : amendment must be adopted no later

The Council did not succeed in 1978 in adopting the regulation proposed by the Commission on 6 October 1976 (Official (b) On 21 December 1978 the Council Journal C 271, p. 5) "on the procedure adopted Regulation No 3085/78 for applying the European unit of (Official Journal 1978 L 369, p. 6), account (EUA) to the legal acts adopted amending, with particular reference to by the institutions of the European the monetary parities to be used, Regu- Communities". The Commission there- lation No 259/68 laying down the Staff fore set to work to bring up to date, in Regulations of Officials of the European the light of the situation thereby created, Communities and the Conditions of the exchange rates in respect of remun- Employment of Other Servants of the eration for officials which was envisaged Communities, Regulation No 2530/72 by the proposal of 1 April 1977. In an and Regulation No 1543/73 concerning annex to its report in 1978 on the yearly certain special measures. The regulation survey of the level of remuneration embodies the wording of the communi- (COM. (78) 673 final of 29 November cation from the Commission of 29 1978) the Commission sent the following November 1978 and also the formula communication to the Council on which contained in the proposal of 1 April 1977 neither the Parliament, the Court of concerning the weighting to be applied Justice nor the Staff Regulations to amounts transferred. The Council Committee was consulted: added, however: "From that date the difference between the net amounts resulting from the implementation of the regulation and those received in September 1979 shall be reduced by 1/10 ". . . The first two paragraphs of Article per month". The regulation fixes 1 July 63 are to be replaced by the following: 1978 as the relevant date for calculating 'Officials' remuneration shall be remuneration paid in a currency other expressed in Belgian francs. It shall be than Belgian francs on the basis of paid in the currency of the country in the exchange rates used for the which the official performs his duties. implementation of the general budget of Remuneration paid in a currency other the Communities and goes on to state than Belgian francs shall be calculated on that that date shall be changed at the the basis of the exchange rates used for time of the annual review of remuner- the implementation of the general budget ation. of the European Communities on ..." The Commission urges the Council to adopt the aforementioned article before the end of the year as well as Article 17 of Annex VII which is the result of (c) Hand in hand with the bringing up the Council's studies relating to the to date of the rates of exchange, the amendments to the Staff Regulations . . . Council adopted Regulation No 3086/78 The . . . regulation should come into of 21 December 1978 (Official Journal effect on 1 January 1979 . . . and should L 369, p. 8) adjusting the weightings apply from 1 April 1979. However, for applicable to the remuneration and

In fixing the weighting referred to in The applicant is an official of the Article 64 of the Staff Regulations, the Commission employed at the Euratom Council and the Commission have, since Joint Research Centre at Ispra in Italy. 1967, used the following procedure for comparing the level of prices between Brussels and the various other places of The method applicable until 31 March employment. The Statistical Office of the 1979 was advantageous for officials European Communities, in conjunction employed in Italy. It may be seen from with the competent national offices, the application that in the case of, for carries out regular price surveys in example, two employees of German respect of goods and services considered nationality employed in Brussels and as representing typical items of Ispra, in Grade Β 3, Step 3, and married household expenditure for officials in the with two children at secondary school, various places of employment. In respect who transfer through the Commission to of each item the relationship is calculated the BHW home-purchase savings scheme between the price in Brussels and the of their net salary (the maximum), the price prevailing in the town which is one employed at Ispra obtained in used as the point of reference for the January 1976 12% more than his place where the official performs his colleague in Brussels for the part of his duties. By the use of this weighting it is salary transferred to the Federal possible to calculate the relative pur­ Republic of Germany, whereas in March chasing power of currencies in the 1979 he obtained 46.8% more. countries where the officials of the Community perform their duties. For example, the index calculated using the Therefore, the applicant claims, a "Fisher" method expresses in a single privilege was removed but the disad­ figure the relationship of prices in vantages, which could have been to some Brussels to those in Rome and vice versa. degree offset by the advantages of the

1. Declare unlawful and annul the On 21 June 1979 the applicant submitted statement of allowances issued by a complaint under Article 90 (2) of the the first defendant for January Staff Regulations contesting his salary and April 1979 and its decisions statement for April 1979. of 12 July 1979 and 28 September 1979 on the applicant's complaint in so far as salary statements were The Commission rejected that complaint drawn up on the basis of Regu- by a letter of 28 September 1979. lation No 3085/78 of the Council of the European Communities. The present application against that decision rejecting the complaint was (Claims 2 to 4 are deleted) submitted and registered at the Court on 12 November 1979 at the same time as 5. Rule that since April 1979 the three other parallel applications (Cases applicant has been entitled to an 800, 801 and 802/79). It was sub- allowance corresponding to at sequently decided that this case should least that which the applicant become a test case. received in lire up to and including March 1979 after making the same transfers under By a letter of 27 December 1979 the Article 17 of Annex VII to the applicant amended his application to Staff Regulations as up to March challenge, in addition to the calculation 1979 but increased by the of salary for April 1979, that for January percentage of the salary adjust- 1979. ment applied from April 1979 pursuant to Article 65 (1) of the By a letter of 11 February 1980 the Staff Regulations. Commission submitted its observations on the amendment of the application 6. In the alternative to 5. rule that claiming that the time-limit for bringing since April 1979 the applicant has an action to challenge the statement for been entitled to an allowance January 1979 had expired in October calculated on the basis of the legal 1979. provisions in force and applicable until March 1979, that is to say by not applying Council Regulations On hearing the report of the Judge- Nos 3085 and 3086/78, and thus Rapporteur and the views of the of an amount equal to the sum Advocate General the Court (First payable in Italian lire after making Chamber) decided to open the oral the same transfers under Article

III. 1. Order the defendants to compensate the applicant for his III — Submissions and argu- pecuniary loss the amount of m e n t s of the p a r t i e s which is to be fixed by the Court at the amount of interest at 6% payable on the arrears from the 1. In his application the applicant claims date on which they fell due until that his action is admissible for the the date of payment. following reasons :

BRUCKNER ν COMMISSION AND COUNCIL

April 1979. As an incidental matter the official's remuneration. From Article 64 lawfulness of the provisions on which it of the Staff Regulations, which deals is based must be examined. with the weighting and appears to flow from officials' general right to assistance, the applicant can also derive a subjective right to have the same living conditions as other officials, irrespective of his place — Time-limit for bringing an action: the of employment. Individual officials are complaint was submitted in good time entitled to expect living conditions to be as far as the Council regulations are continually monitored and determined,

To that extent the Council's discretion is reduced to only one possible decision. Under Article — Nature of application: head of claim I 65 (2), in the event of a substantial is concerned with the issue of legality, change in the cost of living, the Council with alternative claims set out in 1.5. to must decide what adjustments should be 8. As far as the claims set out in 1.5. to 7. made and "if appropriate to apply them are concerned, they should be regarded retrospectively".

In any assistance (see Articles 24, 58 and 76 of event it is not permissible for an official the Staff Regulations). That represents a at Ispra to be in effect treated worse than

Council Regulation No 3085/78 was adopted without consultation with other institutions as is required. The obligation to consult them follows from the first 2. In its application for a decision on and second subparagraphs of Article 24 a preliminary objection, the Council (1) of the Treaty establishing a single contends that an application based on Council and a single Commission of the Article 91 of the Staff Regulations is European Communities. Regulation No admissible only if it complies with the 3085/78 also expressly refers to Article rules laid down in Articles 90 and 91 of 24. The effect of the breach of that the Staff Regulations, which this obligation to enter into consultation is application does not. First, the applicant that the regulation is invalid. In this has never submitted to the Council a connection the applicant points out that complaint within the meaning of Article Regulation No 3085/78, which was 90 (2). Secondly, the Council cannot be adopted by the Council was not the regarded as the appointing authority. subject of any consultation and was not Therefore Regulations Nos 3085 and and could not be considered by the 3086/78 do not amount to acts adversely institutions which were required to be affecting the applicant which may be involved and with whom consultation challenged by way of the action provided was a condition precedent to its adoption for in Article 91. Nor can an action for a

BRUCKNER COMMISSION AND COUNCIL

3. In his observations on the Council's The Council considers the applicant's objection the applicant points out that claim concerning non-contractual the application directed against that liability likewise inadmissible and recalls institution is not an application for that the criteria which have been laid annulment but only a claim for damages. down in the decisions of the Court There may be doubt whether the (judgment of 20 October 1975 in Case applicant is entitled to proceed against 9/75 Meyer-Birckhardt [1975] ECR the Council under Articles 90 and 91 of 1171) as regards actions for damages the Staff Regulations which as a lex between the Communities and their specialis cannot prevent the application of servants justify its conclusion that the Article 151 and the second paragraph of action for damages is inadmissible for Article 188 of the EAEC Treaty. The the same reasons as those in the case of applicant is therefore entitled to base his an action for annulment based on Article claims on the latter and in so doing is 91 of the Staff Regulations. not obliged to fulfil the conditions laid down by Article 91.

for officials aimed at obtaining provisions contained in Article 91 of the compensation for the damage they have Staff Regulations. suffered. 5. In its rejoinder the Commission The applicant's claim that the regulations points out discrepancies in the are inapplicable is purely an incidental amendment of the application. one. Therefore the Council's obser- vations on the request for a declaration that they are inapplicable are devoid of purpose. IV — O r a l p r o c e d u r e

The parties presented oral argument at 4. In its defence the Commission raises the sitting on 19 and 20 February 1981. no objection to the admissibility of the application as far as it is concerned, The Advocate General delivered his particularly in regard to the procedural opinion at the sitting on 14 May 1981.

Decision

1 By application lodged at the Court Registry on 12 November 1979 Günter Bruckner, an official of the Commission employed at the Joint Research Centre at Ispra in Italy, brought an application under Article 91 of the Staff Regulations of Officials (hereinafter referred to as "the Staff Regulations") against the Council and Commission of the European Communities.

2 In the version in force until the end of 1978 Articles 63 and 64 of the Staff Regulations provided that: "An official's remuneration shall be expressed in Belgian francs. It shall be paid in the currency of the country in which the official performs his duties. Remuneration paid in a currency other than Belgian francs shall be calculated on the basis of the par values accepted by the International Monetary Fund and in force on 1 January 1965. An official's remuneration expressed in Belgian francs . . . shall be weighted at a rate above, below or equal to 100%, depending on living conditions in the various places of employment. The weighting applicable to the remuneration of officials employed at the provisional seats of the Communities shall be equal to 100% as at 1 January 1962."

This date shall be changed, at the time of the annual review of remuneration provided for in Article 65, by the Council acting by a qualified majority upon a proposal from the Commission as provided in the first indent of the second subparagraph of Articles 148 (2) of the EEC Treaty and of 118 (2) of the Euratom Treaty.

Without prejudice to the application of Articles 64 and 65, the weightings fixed pursuant to these articles shall, whenever the above date is changed, be adjusted by the Council, which, acting in accordance with the procedure mentioned in the third paragraph, shall correct the effect of the variation in the Belgian franc with respect to the rates referred to in the second paragraph."

5 Article 2 of the regulation provides:

"Article 17 of Annex VII shall be replaced by the following:

Article 17

1. Payment shall be made to each official at the place and in the currency of the country where he carries out his duties.

6 Article 4 of the regulation provides that the regulation is to enter into force on 1 January 1979 and that it is to apply from 1 April 1979.

7 On 21 December 1978 the Council also adopted Regulation (Euratom, ECSC, EEC) No 3086/78 adjusting the weightings applicable to the remuner- ation and pensions of Officials and Other Servants of the European

BRUCKNER COMMISSION AND COUNCIL

Communities following the amendment of the provisions of the Staff Regu- lations concerning the monetary parities to be used in implementing the Staff Regulations. Article 1 (1) of the regulation fixes inter alia the weighting applicable to remuneration at 74.3 for Italy and at 98.7 for the Federal Republic of Germany.

8 The applicant had regularly transferred, pursuant to Article 17 of Annex VII to the Staff Regulations, a specific part of his remuneration to the Federal Republic of Germany, applying the exchange rate in force on 1 November 1969. As a result of the application of the new provisions cited above, after 1 April 1979 the cost of those transfers, expressed in Italian lire, increased by LIT 284 463.

9 On 21 June 1979 the applicant submitted to the Commission pursuant to Article 90 (2) of the Staff Regulations a complaint against the increase in the cost of those transfers. The Commission replied on 28 September 1979 stating on the one hand that it could not, without exceeding its powers, refrain from applying Council regulations which had duly entered into force and on the other hand that it approved in substance the amendments which had been made to the Staff Regulations.

1 1 By a submission dated 11 January 1980 the Council made an objection as to the admissibility of the application. According to the Council the following three actions are discernible in the application: (1) an action for the annulment of Regulations Nos 3085/78 and 3086/78, (2) an action for damages for non-contractual liability and (3) a claim that the regulations are inapplicable.

12 As far as the action for annulment is concerned, the Council sees two possibilities, namely (a) an action based on Article 91 of the Staff Regu- lations and (b) an action based on Article 146 of the EAEC Euratom Treaty which corresponds to Article 173 of the EEC Treaty. In the first case the application is admissible only if it complies with the rules laid down by Articles 90 and 91 of the Staff Regulations, which this application does not. The applicant has never submitted to the Council a complaint within the meaning of Article 90 (2) of the Staff Regulations. Secondly the Council cannot be regarded as the appointing authority in the applicant's case. Article 91 of the Staff Regulations permits an action to be brought only against acts adversely affecting officials which can emanate only from the appointing authority.

13 In the second case an action for annulment cannot be founded on Article -146 of the EAEC Treaty. Regulations Nos 3085 and 3086/78 apply to all Community officials. Therefore it is not possible to contend that they are decisions addressed to the applicant or decisions of direct and individual concern to him although in the form of a regulation. The Council further- more claims that the action was not brought within two months of the pub- . lication of the regulations in question as required by the third paragraph of Article 173.

17 The applicant believes that, if it is assumed that the requirements of Article 90 (2) of the Staff Regulations must be fulfilled in every case, then it must be said that the applicant fulfils those conditions because he submitted a complaint to the appointing authority against the regulations adopted by the Council. He claims that the Council is contradicting itself when it rules out Articles 90 and 91 of the Staff Regulations for an action for annulment and yet wishes them to apply to an action for damages. The applicant invokes the inapplicability of the regulations only as an incidental claim.

18 The objection raised by the Council must be upheld. An action for annulment of Regulations No 3085/78 and No 3086/78 of the Council is inadmissible, since the regulations in question are of general application and

JUDGMENT OF 12. 11. 1981 — CASE 799/79

cannot be assimilated to decisions which, although taken in the form of regu- lations, are of direct and individual concern to the applicants. Moreover, even if such an action against the Council were admissible in that respect it would nevertheless be inadmissible because it is out of time, having been lodged after the expiry of the period laid down in the third paragraph of Article 173 of the EEC Treaty, which corresponds to the third paragraph of Article 146 of the EAEC Treaty.

19 The applicant's claim for compensation seeks to obtain precisely the same results as those which he would obtain from the annulment of the regu- lations. The Court has held on a number of occasions, in particular in its judgment of 15 December 1966 (Schreckenberg, Case 59/65 [1966] ECR 543) that although a party may take action by means of a claim for compensation without being obliged by any provision of law to seek the annulment of the illegal measure which causes him damage, he may not by this means circumvent the inadmissibility of an application which concerns the same illegality and which has the same financial end in view. The claim for compensation is therefore inadmissible.

On those grounds,

THE COURT (First Chamber)

hereby:

1. Dismisses the application as inadmissible in so far as it is directed against the Council.

2. Orders the applicant and the Council to bear their own costs.

Bosco O'Keeffe Koopmans