C-262/80

1. The salary statement prepared by an 2. Article 184 of the EEC Treaty gives institution and issued to an official expression to a general principle con- may constitute a measure adversely ferring upon any party to proceedings affecting him and be the subject of a the right to challenge incidentally, complaint and ultimately an action. with a view to obtaining the The fact that the institution annulment of a decision addressed to concerned is only applying the regu- him, the validity of the provisions of lations in force is irrelevant in that regulations which form the legal basis respect. thereof.

In Case 262/80,

KIRSTEN ANDERSEN AND OTHERS, officials of the Secretariat General of the European Parliament, represented by Georges Vandersanden, of the Brussels Bar, with an address for service in Luxembourg at the Chambers of Janine Biver, 2 Rue Goethe,

applicants, v

EUROPEAN PARLIAMENT, represented by Martin Schmidt, Director of Personnel and Social Affairs, assisted by Alex Bonn, of the Luxembourg Bar, 1 — Language of the Case: French.

JUDGMENT OF 19. 1. 1984 — CASE 262/80

JUDGMENT

Facts and Issues

The facts of the case, the course of year to review the remuneration of the the procedure and the conclusions, officials and other servants of the submissions and arguments of the parties Communities and to determine any may be summarized as follows : adjustment thereof. Article 64 of the Staff Regulations I — Facts and written procedure provides that the remuneration should be weighted in accordance with the living 1. Article 65 (1) of the Staff Regu- conditions in the various places of lations provides that the Council is each employment. Article 65 (2) provides that

ANDERSEN v PARLIAMENT

in the event of a substantial change in liable to Community tax along with the the cost of living, the Council is to increase in basic salaries. decide, within two months, what adjustment should be made to the weightings. The new method of adjustment adopted on 29 June 1976 provided that the Council was to decide on remuneration adjustments in net terms and that the net At its meeting on 29 June 1976 the rate thus fixed was to be incorporated, in Council adopted a new method for accordance with the following method, adjusting the remuneration of officials in the salary scales given in Article 66 of and other servants of the Communities. the Staff Regulations and in Article 63 of the Conditions of Employment of Other Servants:

JUDGMENT OF 19. 1. 1984 — CASE 262/80

index in Brussels, expressed in each case effect from 1 January 1977 at the same by joint indices." time as new scales were introduced with effect from the same date.

In consequence the new method provides that: 2. Those measures caused distortion in the remuneration of officials to the advantage of those receiving allowances on their taxable income, or an ex- Allowance is to -be made within the patriation allowance or both. In view of framework of the subsequent annual such distortions and in order to avoid review for any interim adjustment of their repetition in future the Council remuneration decided pursuant to Article introduced by Regulation No 2859/77 of 65 (2) of the Staff Regulations and made 19 December 1977 adjusting the re- by adjusting the relevant weightings; muneration and pensions of officials and other servants of the European Communities and the weightings applied thereto (Official Journal L 330, p. 1) an amendment to Regulation No 260/68 of The current weighting for Belgium and the Council of 29 February 1968 laying Luxembourg is to be incorporated into down the conditions and procedure or the salary scales in accordance with the applying the tax for the benefit of aforesaid conditions; the weighting for the European Communities (Official Belgium and Luxembourg thus becomes Journal, English Special Edition 1968 (I) 100% and the weightings for the other p. 37). The amendment subjected the countries of employment are to be amounts liable to Comunity tax, for the adjusted accordingly. period from 1 July 1977 to 30 June 1978, to a weighting of 106.084.

regulation, the distortion to which that claiming that their remuneration and the led was repeated from year to year. arrears in question should be calculated without regard to Regulation No Since it was found that unintended 160/80. increases in remuneration resulted from the manner in which the 157.8 weighting The European Parliament rejected the was incorporated in the basic salary complaints by implication by not replying scales, as decided in December 1976, thereto within the period of four months with effect from 1 January 1977, the provided for in Article 90 (2) of the Staff Council determined to put an end to Regulations. Subsequently the applicants that situation and on 21 January 1980 brought the present joint action on adopted Regulation No 160/80 amend- 25 November 1980. ing the Staff Regulations (Official Journal L 20, p. 1). That regulation lays down a new table of gross monthly Upon hearing the report of the Judge- salaries and abolishes the distortions in Rapporteur and the views of the question. It entered into force on 27 Advocate General the Court (First January 1980 with effect from 1 July Chamber) decided to open the oral 1979. It provides however that no part of procedure without any preparatory the salaries paid betwen 1 July 1979 and enquiry. the date on which the regulation entered into force should be required to be However, at the request of the applicants repaid. On the other hand it lays down a the President of the First Chamber transitional scheme for the benefit of adjourned the opening of the oral officials who might suffer a loss of procedure until after the judgment of the income on application of the new scale. Court in Case 59/81 Commission v So long as the new scale would involve Council, which was given on 6 October them in a loss of income the regulation 1982. provides that they are to continue to enjoy the benefit of the former scheme.

Admissibility In reply the applicants refer first of all to the case-law of the Court from which it appears that a statement of salary may The applicants state that the application constitute a measure adversely affecting is directed against the statements of an official within the meaning of the arrears and salary statements for Staff Regulations, causing, when it February and March 1980, the annul- clearly shows the decision taken, the ment of which is sought in so far as they period for bringing an action to start to reflect the application of the revised run. scales introduced by Regulation No 160/80. The claim is therefore for annulment of individual measures and is Then they claim that the raison d'être for accompanied by an objection of illegality the objection of illegality provided for in as regards Council Regulation No Article 184 of the Treaty is on the one 160/80. hand to allow unprivileged applicants to challenge the validity of a provision applied to them and on the other to The European Parliament, the defendant, prevent the application of unlawful observes that according to Article 90 (2) general measures which may no longer of the Staff Regulations the measure be challenged because the period for adversely affecting an official which he bringing an action to have them declared may bring before the Court must be a void has expired. "decision" taken by the authority or the failure to adopt a measure required by the Staff Regulations. In its opinion the In its rejoinder the Parliament states that statements of salary, the annulment of case-law has hitherto dealt only with the which is sought, are not the specific question whether a salary statement expression of decisions taken by the causes periods to start to run, which administration but represent mere does not imply that it constitutes a compliance by the administration with decision within the meaning of the Staff provisions of the regulations covering the Regulations. remuneration of officials.

In the first place Regulation No 160/80 Regulations and with the new method is based on an erroneous statement of of adjustment established in 1976. reasons. Contrary to what is stated in the According to the judgment of 5 June second recital in the preamble thereto it 1973 (Case 81/72, Commission v Council cannot be claimed that the regulation [1973] ECR 575) on the annual was adopted to correct "unintended adjustment of salaries for 1979 the increases" in remuneration resulting Council was bound to observe the from the incorporation of the weighting criteria which it established itself in into the salary scales. adopting the new method of adjustment. That method does not allow the Council to reopen the issue of the salaries during the reference period, in the present case the period from 1 July 1978 to 30 June 1979. The Council was not therefore It was in spite of an opinion to the empowered to make the adjustment for contrary by the Commission, the staff 1979 on the basis of amended scales. The representatives and the Working Party only ground capable of justifying in the on the Staff Regulations and after staff present case a derogation from the representatives expressly drew attention method of adjustment would be an error to the problem of distortions that the previously made in drawing up the Council adopted Regulation No 3177/76 scales. In adopting Regulation No which was to be at the origin of the 160/80 the Council was however in no increases in salary corrected by Regu- way correcting an error; on the contrary lation No 160/80. Moreover the Council it had gone back on its assessment of has already in the past tried on two salary policy as determined in 1976. occasions the same method, which produced the same effects. In the applicants' view the Council was fully alerted to the risks of distortion inherent in the course of action contemplated. In those circumstances the applicants in their fourth and fifth submissions also rely on the principle of the protection of legitimate expectation and vested rights. By the same line of argument the applicants in their third submission allege that the Council, in adopting Regulation No 3177/76 in spite of the warnings given to it, failed to exercise due care in The review clause provided by the new administration. After thus knowingly method of adjustment would have running the risk of accepting all the allowed the Council, first on the consequences arising from Regulation adoption of Regulation No 2859/77 and No 3177/76 it cannot subsequently then in 1978, to alter for the future the justify its attitude by an alleged error. method of incorporating the weightings into the scale by inserting a forumia for adjusting the taxable portions of re- muneration in accordance with the view expressed by the staff representatives in 1976. The Council however frustrated The applicants' second submission is that the applicants' legitimate expectation of the adoption of Regulation No 160/80 is the observance of the established method incompatible with Article 65 of the Staff by using the review clause to reopen the

2 T h e applicants have stated that they are challenging by their action the individual decisions addressed to t h e m a n d , by w a y of an objection of illegality, the validity of Regulation N o 1 6 0 / 8 0 o n which the contested decisions are based.

3 T h e E u r o p e a n P a r l i a m e n t raises t w o objections of inadmissibility with regard to the action. In the first place it contends that the salary statements the

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annulment of which is sought are merely the implementation by the administration of the provisions of regulations providing for the remuner- ation of officials; accordingly they cannot be regarded as decisions since no administrative authority has to decide any problem whatsoever.

4 That objection must be dismissed. It follows from the case-law of the Court and in particular the judgment of 27 October 1981 (Joined Cases 783 and 786/79 Venus and Obertv Commission and Council [1981] ECR 2445) that the salary statement prepared by an institution and issued to an official may constitute a measure adversely affecting him and be the subject of a complaint and ultimately an action. The fact that the institution concerned is only applying the regulations in force is irrelevant in that respect.

s In the second place the European Parliament contends that the objection of illegality put forward by the applicants is not admissible. Where the applicants cannot bring a direct action against a regulation the Parliament claims that they cannot, as is apparent from the case-law of the Court, achieve the same end by the indirect means of an objection of illegality. Article 184 of the Treaty does not apply in the present case since it refers to the special case of an applicant who would have been able to bring a direct action under Article 173 but has allowed the time for doing so to expire.

n It must be observed that the recitals in the preamble to Regulation N o 160/80 expressly mention "that unintended increases in remuneration resulted from the manner in which the 157.8% weighting was incorporated in the basic salary scales" and for that reason "this situation should be rectified by adjusting the basic salary scales". Thus the regulation itself states in the recitals thereto that it is intended to correct a situation which appeared following the reform of 1976 and in which increases in remuneration were revealed which did not relate to that reform.

1 2 Those considerations constitute a sufficient statement of reasons on which to base the operation of revising the salary scales. In particular it by no means appears from the decisions and regulations prior to Regulation N o 160/80 that the Council, as part of the method for adjusting the remuneration

ANDERSEN v PARLIAMENT

adopted in 1976, intended to favour certain officials as against others rather than to arrange for the incorporation of the weighting into the scale in a manner which would necessitate subsequent correction of certain distortions the importance of which, moreover, it under-estimated at the time.

i3 The second submission alleges infringement of rules of law inasmuch as the Council did not observe the criteria which it had itself kid down in adopting the decision of 1976 in relation to the method of adjusting remuneration. Whereas Regulation N o 3177/76 constituted a correct application of the method of adjustment defined by that decision Regulation No 160/80 was intended to call that application in question, it is claimed, by readjusting the basic salaries and thus breaking undertakings entered into in relation to the adjustment of remuneration.

i7 The fourth and fifth submissions complain that in adopting Regulation N o 160/80 the Council infringed the principle of the protection of legitimate expectation and the vested rights of the applicants.

is Those submissions are first of all based on the argument that Regulation No 160/80 substantially departs from the method which the Council had selected in June 1976. It nevertheless appears from the previous considerations that the regulation is outside the field of application of the method adopted for implementing Article 65 of the Staff Regulations.

i9 The two submissions are also based on a slightly different argument, namely that the rights acquired by officials under Regulation N o 3177/76 cannot be called in question by the Council save in the event of the adoption of a new method for adjusting remuneration.

20 In that respect it must be remembered that Regulation N o 160/80, which has retroactive effect from 1 July 1979, provides that no part of the amounts paid between that date and the date of its entry into force, namely 27 January 1980, is to be required to be repaid. Furthermore, it provides transitional measures intended progressively to reabsorb the distortions without bringing about a reduction in the amounts actually paid. Moreover, the effect of Council Regulation No 161/80 of 21 January 1980 effecting the annual review of remuneration under the revised scales (Official Journal L 20, p. 5) was to increase, also from 1 July 1979, (the remuneration resulting from the application of Regulation No 160/80 in such a way that, apart from certain

24 As regards inter-institutional conciliation, the applicants have referred to the Joint Declaration of the European Parliament, the Council and the

JUDGMENT OF 19. 1. 1984 — CASE 262/80

Commission of 4 March 1975 (Official Journal C 89, p. 1). That declaration provides that the conciliation procedure which it lays down may be followed for Community measures of general application which have appreciable financial implications, and of which the adoption is not required by virtue of existing measures.

25 It follows that the procedure was not devised for cases in which the Community measures in question does not have appreciable financial implications. As regards Regulation N o 160/80 the applicants have not established or even alleged that it has such implications. In those circum- stances their complaint must be rejected since the sole fact that the Par- liament had requested the initiation of the conciliation procedure is not capable of affecting the legality of the regulation.

26 It follows from all the foregoing that the action must be dismissed in its entirety.

Costs

2. Orders the parties to bear their own costs.

Koopmans O'Keeffe Bosco

Delivered in open court in Luxembourg on 19 January 1984.

J. A. Pompe T. Koopmans Deputy Registrar President of the First Chamber

OPINION OF MRS ADVOCATE GENERAL ROZÈS

(see Case 211/80, p. 147)