C-246/81

JUDGMENT OF THE COURT (SECOND CHAMBER) 10 JUNE 1982'

Nicholas William, Lord Bethell v Commission of the European Communities

(Competition — Air transpon)

Case 246/81

Application for a declaration that a measure is void — Natural or legal persons Conditions for admissibility Action for failure to act — Natural or legal persons — Conditions for admissibilty (EEC Treaty, Art. 173, second paragraph, and Art. 175, third paragraph)

It may be seen from the second A natural or legal person who is asking paragraph of Article 173 and the third an institution, not to take a decision in paragraph of Article 175 of the Treaty respect of him, but to open an inquiry that the applicant, for his application for with regard to third parties and to take a declaration that a measure is void or decisions in respect of them, may have his action for failure to act to be an indirect interest, as other private admissible, must be in a position to persons may have, in such proceedings establish either that he is the addressee and their possible outcome, but he is of a measure of an institution having nevertheless not in the precise legal specific legal effects with regard to him, position of the actual addressee of a which is, as such, capable of being decision which may be declared void declared void, or that the institution, under the second paragraph of Article having been duly called upon to act in 173 or in that of the potential addressee pursuance of the second paragraph of of a legal measure which the institution Article 175, has failed to adopt in in question has a duty to adopt with relation to him a measure which he was regard to him, as is the position under legally entitled to claim by virtue of the the third paragraph of Article 175. rules of Community law.

supported by the following airline operators: AER LINGUS LIMITED (AER LINGUS), Dublin, COMPAGNIE NATIONALE AIR FRANCE (AIR FRANCE), Paris, LINEE AEREE ITALIANE S P A (ALITALIA), Rome, BRITISH AIRWAYS LIMITED (BRITISH AIRWAYS), Hounslow, BRITISH CALEDONIAN AIRWAYS LIMITED (BRITISH CALEDONIAN), Crawley, KONINKLIJKE LUCHTVAART MAATSCHAPPIJ N V (KLM), Amstelveen, DEUTSCHE LUFTHANSA AG (LUFTHANSA), Cologne, OLYMPIC AIRWAYS, Athens, SOCIÉTÉ ANONYME BELGE D'EXPLOITATION DE LA NAVIGATION AÉRIENNE, (SABENA), Brussels, and SCANDINAVIAN AIRWAYS SYSTEM (SAS), Stockholm,

represented by Eduard Marissens of the Brussels Bar, with an address for service in Luxembourg at the Chambers of Lamben H. Dupong, 14a, Rue des Bains, interveners,

LORD BETHELL » COMMISSION

OBJECTION, at the preliminary stage of the proceedings, that the action brought by Lord Bethell against the Commission for failure to act with regard to the fixing by airline operators of passenger fares for transport by air for scheduled flights within the Community is inadmissible,

THE COURT (Second Chamber)

composed of: O. Due, President of Chamber, P. Pescatore and A. Chloros, Judges,

JUDGMENT OF 10. 6. 1982 — CASE 244/81

should the Commission entertain any Lord Bethell concluded his letter with a doubts on the subject, Lord Bethell request that the Commission, if it we. stated that he would be happy to know unable for any reason to respond affi: on what grounds. matively to his request, should give its answer in the form of a decision which might be challenged in the Court under Article 173. The first sentence of Article 89 (1) left the Commission no option but to proceed to action, regardless of the difficulties, and even in the absence of In its reply of 17 July 1981 the any implementing regulations. The Commission pointed out to Lord Bethel! Council's apparent unwillingness to in particular that two inquiries, the first create effective competition in the sector of which was carried out in 1978 and the of air transport did not relieve the other recently, had led it to the Commission of its duties; on the conclusion that in most cases the final contrary, it emphasized them. fixing of air fares was the sole responsibility of the Member Sutes; government participation generally took the form of autonomous price-fixing Intervention by the governments was measurs, and not consultation between purely formal; as a general rule they companies. There was therefore no endorsed without question the tariffs ground, in principle, for scrutinizing the agreed by their carriers through the activity of either the States or the airlines International Air Transport Association. under Article 85.

(a) find that the Commission has failed By order of 17 February 1982 the Court to act in response to that portion of allowed the United Kingdom Govern­ his letter of 13 May 1981 which ment to intervene in support of the dealt with airline concertation applicant's submissions. regarding air tariffs within the Community; By a further order of the same date the Court allowed Aer Lingus Limited, (b) alternatively, annul the Commission's Compagnie Nationale Air France, Linee communication of 17 July 1981 Aeree Italiane SpA, British Airways either in its entirety or in so far as it Limited, British Caledonian Airways, declares that the competition rules Koninklijke Luchtvaart Maatschappij are not applicable to airlines with NV, Deutsche Lufthansa AG, Olympia respect to the fixing of air tariffs Airways, Société Anonyme Belge within the Community; d'Exploitation de la Navigation Aérienne and Scandinavian Airways System to (c) take such further action pursuant to intervene in support of the defendant's submissions. Articles 175, 173 or 176 of the EEC Treaty as the Court in its wisdom may deem appropriate; Ill — Submissions and argu­ (d) in any event, declare that the costs of ments on the admissibility the proceedings are to be borne by of the application, presen­ the Commission. ted by the parties in the course of the written By a document lodged on 17 November procedure 1981 the Commission requested the Court pursuant to Article 91 (1) of the The Commission, which is the defendant Rules of Procedure to decide as to its in the actionNąnd which raised the preliminary objection regarding the objection of inadmissibility, is of the admissibility of the action, to declare the opinion that the application is inad­ action inadmissible as regards its three missible in a number of respects. main heads of claim and to order the applicant to pay the costs. A — The action based on Article 175 of In his observations thereon, lodged on the EEC Treaty 29 January 1982, Lord Bethell requested the Court to dismiss the Commission's (a) The applicant's first head of claim objection of inadmissibility and to order concerns an alleged failure to act on the the Commission to pay the costs. part of the Commission in response to

The question whether Article 175 of the According to the judgment of the Court Treaty may be used by a complainant of 18 October 1979 Case 125/78 under Article 3 (2) of Regulation No 17 (GEMĄ [1979] ECR 3173) the or under Article 89 of the Treaty to complainant within the meaning of compel the Commission to undertake Article 3 (2) of Regulation No 17 of the initial steps in proceedings against a third Council of 6 February 1962, the first party for infringement of the Treaty does regulation implementing Articles 85 and not arise in this case: in its letter of 86 of the Treaty (Official Journal, 17 July 1981 the Commission informed English Special Edition 1959-62, p. 87) the applicant that it had initiated such is not entitled to require from the steps. Commission a final decision as regards the existence or non-existence of the alleged infringement; a fortiori, the applicant, whose complaint is based on Article 89 of the Treaty, and not on (c) As to the acts which the applicant Regulation No 17, cannot compel the requested the Commission to address to Commission through the intermediary of him the ambiguity created by the Article 175 to adopt a reasoned decision discrepancy between the invitation to the within the meaning of Article 89 (2) Commission to act in the letter of 13 addressed to the Member States or the May 1981 and the complaint of failure airlines, or both, for such a decision to act set out in the application might be would necessarily decide as to the sufficient in itself to justify a declaration existence or non-existence of the of inadmissibility. infringement.

willingness to act, and has in fact acted view. It is too early for the Commission's in broad conformity with the applicant's position to be final at this stage. wishes. Since the position and the action were appropriate to the stage reached by the procedure started at the request of the applicant, an action for failure to act The Commission's attitude and action is inadmissible. are appropriate at the present suge of the procedure initiated at the applicant's request; the action under Article 175 is inadmissible in so far as it concerns his specific requests for action on the part of As promised, the Commission wrote to the Commission. the governments setting out the same views as were expressed in the letter to the applicant and emphasizing that even where tariffs were legitimately fixed by Inasmuch as the applicant may have governments by autonomous measures wished the Commission to adopt a air transport tariffs must not be so unfair different approach, the judgment of the as to infringe Article 86. Court of 13 July 1971 Case 8/71 {Komponistenverband [1971] ECR 705) indicates that such a wish cannot be satisfied by means of an action under the As promised, the Commission wrote to second paragraph of Article 175. the airlines with reference to Article 89 requesting details of the inter-airline arrangements for matters other than tariffs. Lastly, the portion of the letter of 13 May 1981 concerning concertation between airlines with regard to tariffs does not constitute a request for action The Commission announced legislative addressed to the Commission and the proposals which were in accordance with latter is in no way bound to make known the applicant's request for action and its views on opinions of fact or law approved both a proposal for a regu- expressed by Community citizens; in any lation on the application of Articles 85 case, it cannot be compelled to do so by and 86 of the Treaty to air transport and means of an action under Article 175. In a proposal for a directive on tariffs for so far as the action under Article 175 is scheduled air transport between Member intended to elicit confirmation that the States. Commission agrees with that portion of the applicant's letter which contains opinions of fact and of law, it is inadmissible. The Commission is aware of the risk of infringement of the rules on competition which is inherent in the close relations between governments and their national B — The action based on Article 173 of airlines. It certainly does not consider the EEC Treaty that no action is legally available against the airlines directly; it has started a fresh investigation and is endeavouring to obtain the material necessary to disprove (a) Contrary to the applicant's or corroborate its preliminary point of allegation the Commission nowhere

It does not produce legal effects for the (b) The latter is in any case applicant: it gives the Commission's inadmissible in itself: it is clear from provisional opinion on the factual and Articles 173 and 174 of the Treaty that legal aspects of competition in the airline all that may be obtained from the Court sector; it announces certain steps in an under Article 173 is a declaration that investigation under Article 89 of the the act in question is void; under Article Treaty, but those steps do not bring 175, on the other hand, the only relief about any distinct change in the legal available is a declaration that the position of/ the airlines or the inaction complained of is unlawful. The governments in question and, a fortiori, Court cannot give a ruling which goes do not produce legal effects touching the beyond those two measures. applicant's interests or legally binding on him. Article 176 states expressly that it is for the institution in question to take the The letter of 17 July 1981 in no way necessary measures to comply with the signifies the end of a procedure; on the judgment of the Court; the Court has no contrary, it announces the beginning of a power to take action itself under that procedure under Article 89 of the provision. Treaty. 2. Lord-BethelĻ the applicant in the The position adopted by the Commission main action and the defendant as regards is not definitive; it could not be so at the objection, considers that the Com­ such an early suge in the inquiry. Far mission's objections of inadmissibility are from rejecting the applicant's complaints unfounded in their entirety.

(c) In so far as the Commission's letter of 17 July 1981 conveyed and confirmed (b) Until 17 July 1981 the Commission the adoption of a definite position on the rejected the possibility that the airlines absence of any infringement of Article 85 might themselves be implicated in the (1) by the airlines in fixing tariffs the infringements of Article 85 (1) as regards applicant seeks to have that position the fixing of tariffs; on the contrary, it annulled under Article 173. In his letter took the view that tariffs were fixed by of 13 May 1981 he expressly requested the Member States and constituted auto- that the Commission's response, if nomous price-fixing measures; it con- negative, be in the form of a decision tinued to maintain in reserve the subject to appeal. possibility of taking action against

JUDGMENT OF 10. 6. 1982 — CASE 246/81

(f) There is no comparison between the (d) The textual basis for the decision in Commission's action in the Kompo- GEMA on which the Commission relies nistenverband case, where it acted

LORD BETHELL v COMMISSION

essentially to satisfy the interest for Marissens, presented oral argument on which protection was sought, and the the admissibility of the application and reluctant, obscure steps which it claims their replies to the questions raised by to have taken in the present case in the Court. response to the applicant's complaints. In the present instance the Commission has The airlines, intervening, maintained that neither adopted a position nor acted. the application was inadmissible in a number of respects. B — The action based on Article 173 It was inadmissible under Article 175 because the applicant was not entitled to If the correct interpretation of the letter demand that the Commission address a of 17 July 1981 is that the Commission decision to him and there was no did not adopt a position with respect to provision of Community law giving him the autonomous fixing of airline tariffs any locus standi. by governments, no action is available under Article 173; however, if it The application was inadmissible under amounted to a definition of the Article 173 because it was directed Commission's position in that sense, such against a measure which did not have the action is possible. form of a decision.

The background to the dispute

3 It may be seen from the file that Lord Bethell, who is a Member of the European Parliament, a Member of the House of Lords and Chairman of the Freedom of the Skies Campaign, has for some time past been engaged in action against agreements and concerted practices which, he alleges, exist between airlines operating scheduled flights as regards passenger fares in Europe.

4 In a letter sent to the Commission on 13 May 1981, after setting out the problem as a whole, the applicant complained that the Commission had done nothing to bring that situation to an end and asked "that the Commission make a sun with discharging the duty it should have been discharging in the past, that it announce that it is going to an under Article 89" of the EEC Treaty, "and that it start to do so by demanding information and expla- nations from the airlines". In conclusion Lord Bethell gave the Commission notice that he intended to complain to the Court of Justice under Article 173 or 175 of the Treaty if the Commission declined to take the action he deemed appropriate.

5 By letter of 17 July 1981 the Director-General for Competition explained to the applicant the Commission's attitude with regard to the problem raised in his letter of 13 May 1981 in so far as it related to the fixing of air fares. He

LORD BETHELL » COMMISSION

7 By an application dated 17 November 1981 under Article 91 of the Rules of Procedure the Commission put forward an objection of inadmissibility and asked the Court for a decision thereon at this preliminary suge of the procedure.

8 The United Kingdom and a number of airline operators, comprising the principal European airlines, applied to intervene in the action. The United Kingdom suted that it wished to intervene in support of Lord Bethell's claim

JUDGMENT OF 10. 6. 1982 — CASE 246/81

that the Commission's communication of 17 July 1981 should be declared void in so far as the Commission stated that there was no ground for applying Article 85 with regard to the fixing of air fares. The airlines for their pan applied to intervene in support of the Commission's submissions. ,

9 The Court decided to accede to the Commission's request and as a pre- liminary step to consider the objection of inadmissibility. Following that decision, by order of 17 February 1982 it assigned the case to the Second Chamber for a decision as to the admissibility of the action.

io By orders of the same date the Court allowed the intervention of the United Kingdom and the airlines. Only the airlines gave their views, during the oral procedure, as to the question of admissibility.

i4 In reply to a question from the Court the applicant stated that the measure to which he believed himself to be entitled was "a response, an adequate answer to his complaint saying either that the Commission was going to act upon it or saying that it was not and, if not, giving reasons". Alternatively the applicant took the view that the letter addressed to him on 17 July 1981 by the Director-General for Competition was to be described as an act against which proceedings may be instituted under the second paragraph of Article 173.

is The principal question to be resolved in this case is whether the Commission had, under the rules of Community law, the right and the duty to adopt in respect of the applicant a decision in the sense of the request made by the applicant to the Commission in his letter of 13 May 1981. It is apparent from the content of that letter and from the explanations given during the proceedings that the applicant is asking the Commission to undertake an investigation with regard to the airlines in the matter of the fixing of air fares with a view to a possible application to them of the provisions of the Treaty with regard to competition.

16 It is clear therefore that the applicant is asking the Commission, not to take a decision in respect of him, but to open an inquiry with regard to third parties and to take decisions in respect of them. N o doubt the applicant, in his double capacity as a user of the airlines and a leading member of an organiz- ation of users of air passenger services, has an indirect interest, as other users may have, in such proceedings and their possible outcome, but he is nevertheless not in the precise legal position of the actual addressee of a decision which may be declared void under the second paragraph of Article 173 or in that of the potential addressee of a legal measure which the Commission has a duty to adopt with regard to him, as is position under the third paragraph of Article 175.

On those grounds,

T H E COURT (Second Chamber)

hereby:

1. Dismisses the application as inadmissible;

2. Orders the applicant to pay the costs incurred by the Commission and orders the interveners to bear their own costs.

Due Pescatore Chloros