C-258/81

1. It appears from Articles 2 and 9 (1) of possible among all undertakings in the the Act of Accession concerning Community, the fact that the Greece that the Act is based on the restrictions on production necessitated principle that the provisions of by the economic situation might affect Community law apply ab initio and in the profitability and very existence of toto to the new Member Sute, dero- certain undertakings cannot be gations being allowed only in so far as considered to be an infringement of they are expressly laid down by the right to property. An undertaking transitional provisions. may not claim respect for its right to property in order to evade the constraints imposed upon the entire 2. The fact that the new Article 14a European steel industry. made it possible under the production quota system imposed by Decision 1831/81/ECSC on steel undertakings 5. The purpose of the system of in respect of certain products to make production quotas established by an appropriate adjustment to the Decision 2794/80 and renewed by reference production figures of Greek Decision 1831/81 is not to guarantee steel undertakings faced with to undertakings a minimum level of exceptional difficulties may not be employment or scope for development used as an argument for contesting but to spread in an equitable manner the principle of the application of the the effects of the steel crisis among quota system to Greek undertakings undertakings according to their actual during the previous period. production. The fact that the refer- ence period taken into consideration 3. The effect of the accession of Greece preceded the accession of Greece is to the Community was to extend the not of such a nature as to give rise to whole of Community law to the inequality of treatment to the undertakings of that State and those detriment of the undertakings of that undertakings may not claim State since at the time under exemption from the rules and consideration they were totally free to constraints which, depending on the expand their investment and circumstances, may apply to them as a production programmes. Nor is it part result of the application of that law of the purpose of the contested on an equal basis with the other general decision to alter the undertakings in the Community. conditions of competition created by the structure, level of development 4. Since the purpose of Decision and utilization rate of Greek under- 1831/81 is to spread the effects of the takings compared to the other under- crisis in the most equitable manner takings in the Community.

THE COURT (Second Chamber)

composed of: P. Pescatore, President of Chamber, O. Due and K. Bahlmann, Judges,

Advocate General: P. VerLoren van Themaat Registrar: J. A. Pompe, Deputy Registrar

gives the following

JUDGMENT OF 9. 12. 1982 — CASE 258/81

JUDGMENT

That decision left open the question of the system to be applied to the light I — Summary of the facts section category (wire-rod, concrete reinforcing bars and merchant bars) pending the outcome of talks which the After arriving at the view in the third Commission was to have with the quarter of 1980 that the European iron producers of those products. and steel industry was for the purposes of Article 58 of the ĖCSC Treaty in a As regards wire rod, criteria for manifest crisis and after the indirect establishing a voluntary system of courses of action available to it had reducing production had been laid down proved to be ineffective or insufficient to by a number of producers accounting for cope with the crisis, the Commission a sufficiently high proportion of arrived at the conclusion that in order to production of that product. On the other restore balance between supply and hand no basis could be evolved for the demand it must intervene directly by establishment of a voluntary system means of binding measures relating to covering concrete reinforcing bars and production. Consequendy, by Decision merchant bars. 2794/80/ECSC of 31 October 1980 (Official Journal 1980, L 291, p. 1) it Since there was no improvement in established a system of steel production market conditions and the level of orders quotas for undertakings in the and information concerning economic Community's iron and steel industry trends pointed on the contrary to a applicable until 30 June 1981. possible deterioration in the situation, the Commission considered it necessary Nevertheless demand for most steel to include concrete reinforcing bars and products fell further and the slight merchant bars in the compulsory system increase in prices was insufficient in view of production quotas. of the financial burdens on undertakings. Towards the middle of 1981 it thus Consequently it adapted Decision appeared that the European iron and 1831/81 by its Decision 1832/81/ECSC steel industry was still in a period of of 3 July 1981 and included concrete manifest crisis and that the attainment of reinforcing bars and merchant bars in the the objectives set out in Article 3 of the new system of production quotas ECSC Treaty was seriously jeopardized. established under Decision 1831/81 (Official Journal 1981, L 184, p. 1). By Decision 1831/81/ECSC of 24 June 1981 (Official Journal 1981, L 180, p. 1) Article 5 of Decision 1831/81, as the Commission therefore established for amended by Decision 1832/81, provides

that the Commission is to fix each reference production corrected for the quarter for each undertaking its third quarter of 1981 is to constitute the production quota and the part of such annual corrected reference production. quotas which may be delivered in the Common Market on the basis of reference production and reference Article 8 of Decision 1831/81 provides quantities and by the application of that the reference quantities which are abatement rates to such production and used to establish the proportion of the quantities. quotas which may be delivered on the Common Market by each undertaking are to be calculated by applying to its reference production the percentage of The rules for determining the reference its deliveries on the Common Market production for Categories V and VI compared with its total production (concrete reinforcing bars and merchant during the period of the 12 best months. bars) are set out in Article 7a inserted into Decision 1831/81 by Decision 1832/81. Article 9(1) of Decision 1831/81 provides that the Commission is to fix each quarter the abatement rates for According to that provision account is to establishing the production quotas and be taken of the quotas allocated by the the part of those quotas which may be Commission during the period of delivered on the Common Market. application of Decision 2794/80. Those quotas are to be used to reconstitute the relevant reference production on the Commission Decision 1833/81/ECSC basis of the abatement rates in force of 3 July 1981 (Official Journal 1981, during the three quarters in question. L 184, p 6) fixed those abatement rates The corrective factors are to be the for Categories V and VI (concrete ratios between that reconstituted reinforcing bars and merchant bars) for reference production and the quarterly the third quarter of 1981. The abatement reference production figures determined rate was 30% for production quotas and pursuant to Article 4 (1) of Decision 35% for the part of the quotas which 2794/80 (for each month of the relevant could be delivered on the Common quarter reference is to be made to the Market. same month during the period from July 1977 to June 1980 during which total production was the highest; the three months thus chosen, which will not Article 9(2) of Decision 1831/81 necessarily be consecutive, are to provides that the Commission must constitute the reference period). The notify to each undertaking its reference average of those corrective factors is to production and reference quantities as be applied to the refeence production well as its production quotas and the calculated in accordance with Article pan of those quotas which may be delivered on the Common Market. 4(1) of Decision 2794/80 in respect of the third quarter of 1981 in order to arrive at the reference production figures corrected for that quarter. The sum total By a decision contained in a letter dated of the reconstituted reference production 12 August 1981 the Commission, acting for the three quarters of the period of pursuant to Articles 5 and 9 (2) of application of Decision 2794/80 and the Decision 1831/81, notified to the under-

The Commission's decision of 12 August The written procedure followed the 1981 was notified to Metallurgiki Halyps normal course. AE by post on 24 August 1981.

During the proceedings the decision of Upon hearing the report of the Judge- 12 August 1981 was amended by the Rapporteur and the views of the Commission's decision of 5 January 1982 Advocate General, the Court decided to and then by its decision of 4 February open the oral procedure without any 1982. Those decisions increased the preparatory inquiry. company's production quota for pro­ ducts in Category V (concrete reinfor­ cing bars) for the third quarter of 1981 After the Court's judgment of 16 from 45 504 to 61 123 and then to February 1982 in Joined Cases 39, 43, 85 74 738 tonnes and the part of the quota and 88/81 Halyvourgiki Inc. and which could be delivered on the Helleniki Halyvourgia AE v Commission Common Market from 18 285 to 26 450 had been delivered, the applicant, in and then to 30 032 tonnes. The response to a request from the Court of Commission's decisions of 5 January and 16 March 1982, said in a statement dated 4 February 1982 are not at issue in this 5 April 1982 that it was withdrawing one case. of its submissions in its application.

By an order of 5 May 1982 the Court II — Written procedure decided to assign the case to the Second Chamber pursuant to Article 95 (1) and (2) of the Rules of Procedure. On 22 September 1981 Metallurgiki Halyps AE brought an action for a declaration that the Commission's Following a question put to it by the decision of 12 August 1981 was void. Court the applicant stated in a telex

The Commission contends that the Court should: (a) It argues that the Act concerning the Conditions of Accession of the (a) Dismiss the application as Hellenic Republic and the Adjustments unfounded; to the Treaties, in particular Articles 25 (b) Order the applicant to pay the costs. to 34, 38, 116, 129(1) and 130 thereof as well as Protocol 3 thereto ,on the granting by the Hellenic Republic of exemption from customs duties on the IV — Submissions and arguments importation of certain goods and of the parties in the written Protocol 7 on the economic and procedure industrial development of Greece, introduced transitional arrangements Having withdrawn two of its submissions whose purpose was to harmonize and set out in its application the applicant align the level of development of the primarily bases its action on objections of Greek steel industry with that of the steel illegality to general Decision 1831/81 (as industry of the other Member States amended) pursuant to which the during a transitional period of five years. contested individual decision was Those arrangements may not be adopted. The applicant alleges that amended or repealed by measures Decision 1831/81 is in breach of the Act adopted by the Community institutions. concerning the Conditions of Accession But that is what happens when a specific of the Hellenic Republic and the measure adopted by the Community Adjustments to the Treaties, certain institutions is contrary to the purpose protocols thereto and general principles and spirit of the transitional ar- of law governing their application and, rangements provided for in the Act of secondly, the ECSC Treaty and general Accession and the protocols thereto. principles of law governing its ap- plication. The binding nature of recommendations The Commission considers that all of the and decisions, within the meaning of applicant's submissions and arguments Article 14 of the ECSC Treaty, is subject are unfounded. to the fundamental condition and express

reservation that they comply with the Contrary to the Commission's view, the various rules contained in the Act of provisions of the Act of Accession are, as Accession. That condition is expressly regards their formal validity, in all laid down by Articles 2, 9 and 145 of the respects equivalent to those of the Act of Accession. Treaties establishing the Communities, and since together with those provisions they form a whole they must be interpreted and applied in an identical manner. There are no grounds for interpreting and applying some more strictly than others. (b) As regards the application of Article 58 of the ECSC Treaty during the transitional period, although the Act of Accession does not provide for any special derogations for the Greek steel It may even be argued that the provisions industry, it would be contrary to the of the Act of Accession, introducing general spirit, aim and clear intention of special rules to integrate a new State into the Contracting States, with regard to the Community, are special provisions the structuring of the special transitional which for that reason take precedence arrangements made for Greece to over the general rules. conclude from a strictly literal interpret- ation of Article 2 of the Act of Accession that it is lawful also during the transitional period to adopt pursuant to Article 58 rules of secondary law which (c) In view of the spirit of the are also binding on the Greek steel transitional provisions of the Act of industry. Accession and regard being had to the intention of the Contracting States it should be said that it was thought to be in the common interest to foster the development not only of the Greek economy in general but also, more specifically, of the Greek steel industry In interpreting and applying the Treaties in order to enable it to reduce the the Court must give particular considerable gap and catch up with the consideration to the aims of the level of development of the Community Community and use them as a basis of steel industry within the limited time interpretation for finding the true made available in the transitional period. meaning of the provisions in question. The Court prefers the teleologica! and the contextual method of interpretation to the literal method. In providing that the provisions of the original Treaties In view of the spirit and aim of the and the acts adopted by the institutions transitional provisions the fundamental of the Communities are to apply in question arises whether it is possible for Greece "under the conditions laid down quotas to be introduced if this results in those Treaties and in this Act", Article in reducing the already insufficient 2 of the Act of Accession confirms that it production of Greek steel undertakings. is necessary to apply the teleologicai and The introduction of measures to reduce contextual method of interpretation to production not only retards industrial determine the spirit and ratio legis of the development but . also disrupts the transitional provisions. operation of Greek steel undertakings

causing particularly dire consequences The object of Protocol 3 maintaining in which make the solemnly declared aims force national legislative measures of the special transitional arrangements concerning exemptions from customs worthless. What can be the sense of duty is to continue the aid towards the declaring that it is necessary to protect steady development of the steel and steadily improve and develop the industry's production capacity, an aim Greek economy to bring living standards which the imposition of production in Greece up to those of the other quotas on the Greek steel industry puts European States if the effect of reducing in jeopardy. the already insufficient production of Greek steel undertakings is to bring their operation to a halt and drive them into insolvency? What is the point of protecting national production by means of customs barriers and the import At any rate, the Act of Accession deposit system if Decision 1831/81 might nowhere stipulates that from the time of end or drastically curtail production Greece's entry into the Community which ought to be receiving maximum the "settled achievements of the protection? What is the point of the Community" ["acquis communautaire"] provision in Protocol 7 on the must be applied to it automatically and elimination of under-employment if without any exception. The Community undertakings are forced to lay off staff decisions adopted pursuant to Article 58 because of reductions in production and of the ECSC Treaty must also be because they are compelled to operate compatible with the special provisions under totally uneconomic conditions? laid down in the Act of Accession. No What is the point of progressively express provision to that effect is needed evening out regional differences in levels in that act. of development as declared in Protocol 7 if the regions of Greece in which the steel undertakings are located sink into depression? What is the point of the provision in Protocol 3 on the granting to Greece of the right to maintain the legislative measures to aid development if (d) The production limits imposed on owing to the limit placed on production Greek steel undertakings by Decision the applicant company benefiting from 1831/81 are contrary to the general those measures must substantially reduce principles of legal certainty, protection of the level of production which it was legitimate expectation and the right to entitled to attain? property.

Decision 2804/81 inserted into Decision Decision 1831/81 jeopardizes the 1831/81 a new article, 14a, permitting supremacy of primary Community law. the Commission to grant special treat- Protocol 3 and the relevant provisions of ment to Greek undertakings to which the the Act of Accession are clearly intended quota system causes exceptional to help to improve and develop the difficulties likely to prevent them from production capacity of Greek industry. adapting themselves to the structural The framework thus created for the developments in Greece's economy. development of Greek steel undertakings during the period of validity of the transitional arrangements may not be changed by recommendations and The Commission considers that the decisions of the Community institutions without prejudicing the principles of applicant's arguments are wholly without legal certainty and protection of merit. legitimate expectation of individuals with respect to the primacy of Community law. (a) The Act of Accession made absolutely no exception as far as the application of Article 58 of the ECSC (e) The Commission has itself sub- Treaty to Greek steel undertakings is sequently recognized that it cannot be concerned. In accordance with Article 2

METALLURGIKI HALYPS v COMMISSION

The fact that the Act of Accession Just to refuse the imposition of quotas contains certain transitional provisions on Greek undertakings would make providing in particular for the Article 58 meaningless. The argument progressive abolition of customs barriers that Article 58 does in theory apply to and of the deposit system does not mean Greek undertakings but that measures, in that those exceptions must be extended this case quotas, cannot be imposed on to other fields, in particular to a them pursuant to Article 58 is quite production quota system established contradictory and without foundation. under Article 58. Article 58 applies to all steel under- takings in the Community. As from the accession of Greece, the undertakings of that country have the same rights and As far as methods of interpretation are obligations as the other steel under- concerned, it must be remembered that takings in the Community in the absence when the Court uses the teleological and of any express provision to the contrary. contextual method of interpreting legal provisions in cases in which they are not clear it always does so on the basis of a specific provision in the field under The purpose of the transitional period is consideration. In the present case the not just to protect Greece but also the only provision in question is Article 58 of existing Community. The transitional the ECSC Treaty and the Act of period involves reciprocal rights and Accession makes no derogation from it. obligations for the contracting parties and in no way can it be construed as a preferential arrangement for Greece. If the legal provision is clear, interpre- tation is not necessary. In no case can there be any question of entirely The applicant's argument to the effect escaping the application of Article 58. that the provisions of the Act of Accession constitute a lex speciales in relation to the provisions of the ECSC Treaty and the measures adopted (b) As regards the applicant's pursuant to that Treaty is right only in contentions about the purpose of the so far as the provisions concerned transitional protective arrangements establish substantive rules in materially applicable to Greece, it must be said that the same field in derogation from the Protocol 7 to the Act of Accession original rules.

(c) The reliance placed on the general the guarantee afforded to the ownership principle of legal certainty conflicts in of property cannot be extended to this case with the express wording of protect commercial interests, the uncer- Protocol 3 and with the principle of the tainties of which are pan of the very primacy of Community law. Moreover, essence of economic activity. in the case-law of the Court the principle of legal certainty does not have the substance which the applicant attributes to it. .(d) The applicant is mistaken about the purpose and meaning of Decision 2804/81 and derives from them arguments which are wholly without merit. The principle of the protection of legitimate expectation has no application in this case either. Legitimate expectation may be held only with regard to Two new factors explain why a special Community provisions from which provision for undertakings whose plant is private individuals expect or derive rights located in Greece was not introduced and not with regard to purely national until 23 September 1981 and show that provisions and certainly not with regard in introducing that provision the to national provisions which are replaced Commission was not in any way per- by provisions contrary to Community forming an obligation which it had under law. The concept of legitimate the Act of Accession. The first factor, expectation is related to the maintenance which emerged only after 1 July 1981, of a system of rules established by was that, unlike Decision 2794/80, Community regulations based on Decision 1831/81, as amended by primary or secondary law which benefit Decision 1832/81 does not contain individuals who might suffer damage if provisions allowing the general rules of they were repealed without warning and the quota systm to be relaxed in order with immediate effect. Those conditions to help under ings facing exceptional do not obtain in this case. The applicant difficulties as a ; esult of that system. The places reliance on the principle in a second new factor was that the infor- negative way in order to avoid the mation available to the Commission, application of a new system which it which was still incomplete on 23 considers undersirable. In any eyent the September 1981, indicated that there was principle of the protection of legitimate a danger that "the current measures, and expectation cannot have the effect of in particular Article 14, might not allow rendering inoperative Decision 1831/81 such undertakings to overcome the which is necessitated by an overriding exceptional difficulties created by the public interest. specific situation in that country", a situation which forces the Greek steel industry to make "constant efforts" to adjust itself.

those undertakings themselves and the During the reference period 1978 to applicant in particular. 1980 prior to accession the Community steel undertakings had created sufficient reserves whereas the less developed Greek undertakings do not meet even In any event Anicie 14a added by 50 % of the needs of the domestic Decision 2804/81 grants no exemption market. The reserves of the steel under- to the Greek steel industry as a whole. takings of the other Member States put them in a clearly much better position and lead to discrimation against Greek undertakings. B — Infringement of Articles 58 and 1 to 5 of the ECSC Treaty and breach of the general principles of Uw governing their application The Greek steel industry is also discrimi- nated against because it must bear high financing costs whereas most European The applicant considers that if contrary steel undertakings receive a substantial to all probability general Decision support from the State. 1831/81 were not to be considered incompatible with the transitional arrangments introduced by the Act of Accession it is in any case contrary to Owing to the differences in the factual certain provisions of the ECSC Treaty situation of the Greek steel industry and general principles arising from them. compared to that of the Community steel industry during the reference period the uniform application of the quota system obviously results in discrimination and (a) Article 58 (2) of the ECSC Treaty offends against the principle of allows quotas to be determined "taking proportionality inasmuch as it takes no account of the principles set out in account at all of the fact that in 1979 Articles 2, 3 and 4" which are based on and 1980 steel production rose to 140 the fundamental principle of equal million tonnes in the Community treatment. However, the quota system countries whilst in Greece it did not established by Decision 1831/81 creates exceed one million tonnes in the same serious inequalities detrimental to Greek period. steel undertakings.

The second paragraph of Article 2 of the ECSC Treaty requires the Community to According to Article 5 of the ECSC bring about conditions which will of Treaty, the Community must ensure the themselves ensure the most rational establishment of normal competitive distribution of production at the highest conditions. But by imposing quotas on possible level of productivity. By Greek undertakings' production the imposing quantitative restrictions on decisions at issue make the operation of production the decisions at issue waste those undertakings clearly uneconomic the applicant's production capacity and and deny them normal competitive prevent it from exploiting its new conditions. technology and remaining competitive; they inevitably have the effect of reducing employment and, in breach of Protocol 7, fundamentally disturb the Greek economy inasmuch as the steel industry is the most important sector of (c) General Decision 1831/81 was the country's heavy industry. published in the Official Journal of the Communities on 1 July and the amending Decisions 1832 and 1833/81 on 4 July 1981. The contested individual decision did not reach the applicant until 24 August, that is 54 days after the pub- In breach of Article 3 (d) and (g) of the lication of the general decision on which ECSC Treaty the production quotas it is based. The applicant cannot possibly fixed by the decisions at issue for Greek comply with it. During the period of 54 undertakings make it impossible for them days the applicant exhausted most of the to expand and improve their production production quota granted to it, which capacity, they constitute an obstacle to entailed the obligation to cease operating improvement of production conditions during the remaining 36 days. and establish a system which favours the large unprofitable groups in the North and is clearly unfavourable to the smaller, though more competitive and flexible, industrial undertakings. The Court has held that some decisions may be made retroactive provided that there is no breach of the principle of the protection of legitimate expectation. However, in this case there has been a The failure, in the decisions at issue, to failure to observe that principle. During recognize clear differences between the period in which the applicant had no Greek steel undertakings and Com- reason to entertain any doubts it munity undertakings in their level of undertook by a contract made with Sitco development and the introduction of a Europa SA to export 400 000 tonnes of

The quota system was not imposed in order to redistribute the percentage rate Because the quota system was introduced of utilization of undertakings' pro- so late the applicant was put under an duction potential or to define the system obligation to repudiate its contractual of aid to the steel industry but solely to obligations and to suffer considerable restore the balance between supply and damage owing to the enforced shutdown demand. of its production plant in clear breach of the principles of the protection of legitimate expectation and legal certainty. As far as the principle of proportionality is concerned, Decision 1831/81 is not an excessive and unacceptable intervention measure compared to the aim in view The Commission considers that Decision and did not impose disproportionate 1831/81 does not infringe any provisions burdens on certain undertakings. of the EEC Treaty or general principle of law governing its application and does not prejudice the principle of non-retro- activity. (b) Article 3 of the ECSC Treaty lays down no fewer than eight distinct objectives and it is not certain that they can all be simultaneously pursued in their (a) The quota system established by entirety and in all circumstances. A Decision 1831/81 is perfectly fair and compromise must be found between non-discriminatory. It provides for all those various objectives, especially in a undertakings to have reference pro- period of crisis justifying the adoption of duction which takes account not only of exceptional measures which derogate the best months of actual production from the normal rules governing the during the period from July 1977 to June working of the common market in steel 1980 but also all the adjustments granted and which may entail non-compliance under the old system introduced by with certain objectives laid down by Decision 2794/80. Below a specific level Article 3, such as that mentioned in of production small undertakings are not paragraph (b). It is the Commission's subject to the quota system. Reference task to choose the objectives which it quantities and consequently the part of believes are necessary for solving the quotas which may be delivered on the existing problems. The fact that Article 3 Common Market may be adjusted. requires it to act in the common interest Adjustments are also possible in the case certainly does not mean that it must act of certain medium-sized undertakings by taking into account the interests of all faced with exceptional difficulties. the undertakings without exception. It Decision 2804/81 makes it possible to weighs up the various interests and seeks grant adjustments to Greek undertakings to avoid damaging results if the decision if the quota system causes one of them which it adopts reasonably allows it to exceptional difficulties likely to prevent it do so.

Decision 1831/81 does not discriminate against Greek undertakings in any way At the sitting on 15 July 1982 Metal- at all. lurgiki Halyps AE, represented by Mr Stamouiis, Mr Arvanitis and Mr Lykourezos, and the Commission, On the alleged infringement of Article 5 represented by Mr Kremlis, presented of the ECSC Treaty the Commission oral argument and answered questions observes that Article 58 (2) only refers to put to them by the Court. the principles set out in Articles 2, 3 and 4 of the Treaty and that, moreover, it is going too far to claim that intervention The applicant claimed in particular that by the Commission must not cause any since it produced only one kind of steel change in an undertaking's competitive product, namely concrete reinforcing position. bars, the application of the same reduction coefficients to all undertakings constituted, to its detriment, a breach of (c) As regards the principle of non- the fundamental principle of equal retroactivity, the Commission observes treatment. It stated that the Commission that the applicant itself is solely has recognized this discrimination, at responsible for the time taken for it to least implicitly, by adopting its Decision receive the contested individual decision 533/82 of 3 March 1982 amending for of 12 August 1981. It was not until 7 the third time Decision 1831/81 (Official August that it sent to the Commission all Journal L 65, p. 6). the information which the Commission had asked for on 3 July and which was essential for the quotas to be fixed. The Commission reminded the Court that by a decision of 4 February 1982, adopted pursuant to Article 14a inserted In any event some decisions may be into Decision 1831^81 by Decision made retroactive provided that this does 2804/81, it increased for the second time not offend against the principle of the the quotas allocated to Metallurgiki protection of legitimate expectation. Halyps for the third quarter of 1981. As However, in this case that principle a general point it must be noted that the

2 On the basis of its submissions as they now stand the applicant claims, in support of its action against the decision of 12 August 1981, that general Decision 1831/81 on which it is based is not applicable to Greek under- takings because it fails to have regard, first, to the transitional arrangements made in the Act of Accession concerning Greece and, secondly, to Articles 1 to 5 and 58 of the ECSC Treaty and the general legal principles governing their application.

JUDGMENT OF 9. 12. 1982 — CASE 258/81

Application of Decision 1831/81 to Greek undertakings

, The applicant claims that the application of the production quota system to Greek undertakings is contrary to the objective of the transitional provisions forming part of the Act of Accession, even if it might appear to be justified on a strictly literal interpretation of Article 2 of the Act.

4 In this respect it relies more specifically on Articles 25 to 34 concerning the gradual abolition of import duties by 1 January 1986, Article 38 concerning the gradual abolition of the import deposit system, Article 129 containing certain specific transitional provisions for the steel industry, Article 130, which is the general safeguard clause, Protocol 3 on the granting by the Hellenic Republic of exemption from customs duties on the importation ot certain goods to aid development of the economy and, finally, Protocol 7 on the economic and industrial development of Greece.

» The applicant takes the view that, taken as a whole, those provisions show that Decision 1831/81 cannot be applied per se to Greek undertakings since its effect is to reduce production, which is already insufficient to meet Greece's development needs, and it not only slows down industrial development but also disrupts the operation of Greek steel undertakings. In this regard it is argued that the application of the quota system to Greek undertakings is contrary to the general principles of legal certainty, protection of legitimate expectation and the right to property.

io Finally, the applicant points out that the Commission recognized the particular situation of the Greek industry and inserted in Decision 1831/81 a new article, Article 14 a, which thereafter enabled the application of the general decision to be adapted to the particular situation of Greek under- takings.

ii From the information provided during the proceedings it appears that the Commission recognized the particular needs of the Greek steel industry and, by Article 14 a inserted into Decision 1831/81, agreed to allow an appro- priate adjustment of the reference production figures of Greek steel under- takings faced with exceptional difficulties as soon as it could obtain sufficiently precise information about their situation. The introduction of this degree of flexibility may not be used as an argument for contesting the principle of the application of the quota system to the Greek undertakings during the previous period.

JUDGMENT OF 9. 12. 1982 — CASE 258/81

i2 The applicant has failed to specify how the application of Decision 1831/81 might have adversely affected legal certainty in its regard or its legitimate expectation. On this matter it need only be observed that the effect of the accession of Greece to the Community was to extend the whole of Community law to the undertakings of that State and that those under- takings may not claim exemption from the rules and constraints which, depending on the circumstances, may apply to them as a result of the application of that law on an equal basis with the other undertakings in the Community.

is The applicant claims that if Decision 1831/81 were held to be applicable to Greek undertakings it would entail consequences for those undertakings which would be inconsistent with the principles forming the subject-matter of the introductory articles of the ECSC Treaty. In essence it claims in this respect that the taking into consideration of a reference period which preceded the accession of Greece and was chosen in such a way as to reflect the position of the undertakings in the Community as previously constituted worked to the disadvantage of Greek undertakings, whose utilization rate in that period· was substantially lower than that of other Community under- takings. The applicant's utilization rate was particularly low because its plant is new. The applicant further argues that by making it impossible for the Greek undertakings to expand and improve their production capacity the quota system puts them at a disadvantage in relation to undertakings located

METALLURGIKI HALYPS v COMMISSION

in the Community as previously constituted. It believes that those circum- stances constitute a breach of the principle of non-discrimination and adversely affé« conditions of competition.

ie Finally the applicant complains that the principle of non-retroactivity has been infringed inasmuch as after general Decision 1831/81 had entered into force the Commission was slow in sending it the decision concerning it individually. That decision, dated 12· August 1981, did not reach it until well after the beginning of the quarter in question.

17 To the extent to which the applicant's complaints consist of arguments which may be defined and classified in legal terms they call for the following obser- vations.

JUDGMENT OF 9. 12. 1982 — CASE 258/81

mation for which it was asked. The Commission rightly observes that in any case from the date of publication of Decision 1831/81 the applicant was m a position to calculate, at least approximately the quota which would be allocated to it and could have arranged its product.on programme accordingly.

23 It thus appears that there are no grounds for upholding any of the complaints and that the application must therefore be dismissed.

Costs

21 Under Article 69 (2) of the Rules of Procedure the unsuccessful party is to be ordered to pay the costs.

22 As the applicant has failed in its submissions it must be ordered to pay the costs.

Delivered in open court in Luxembourg on 9 December 1982.

P. Pescatore J. A. Pompe President of the Second Chamber Deputy Registrar