C-191/82
ECLI:EU:C:1983:259
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- Súdny dvor Európskej únie
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JUDGMENT OF 4. 10. 1983 — CASE 191/82
lation No 3017/79 and whether or to give rise to a belief that sub not it has committed manifest errors sidization is taking place or has in its assessment of the facts, has included in the reasons on which its omitted to take into consideration any decision is based considerations essential matters of such a nature as amounting to a misuse of powers.
In Case 191/82
EEC SEED CRUSHERS' AND OIL PROCESSORS' FEDERATION (FEDIOL), having its registered office in Brussels, represented by Dietrich Ehle, Rechtsanwalt, Cologne, with an address for service in Luxembourg at the Chambers of Ernest Arendt, 34 B Rue Philippe-II, applicant,
v
COMMISSION OF THE EUROPEAN COMMUNITIES, represented by its Legal Adviser, Peter Gilsdorf, acting as Agent, with an address for service in Luxembourg at the office of Oreste Montalto, a member of its Legal Department, Jean Monnet Building, Kirchberg, defendant,
OBJECTION , at the present stage of the proceedings, that the application made by the EEC Seed Crushers' and Oil Processors' Federation (Fediol) for a declaration of the nullity of the Commission's communication of 25 May 1982 refusing to initiate an anti-subsidy proceeding in respect of imports of soya-bean oil-cake from the Federative Republic of Brazil, is inadmissible,
THE COURT
composed of: J. Mertens de Wilmars, President, P. Pescatore, A. O'Keeffe and U. Everling (Presidents of Chambers), Lord Mackenzie Stuart, G. Bosco, T. Koopmans, O. Due, K. Bahlmann, Y. Galmot and C. Kakouns, Judges,
Advocate General: S. Rozès Registrar: P. Heim
gives the following
FEDIOL v COMMISSION
JUDGMENT
Facts and Issues
The facts of the case, the course of countries not members of the EEC the procedure and the conclusions, (Official Journal 1979, L 339, p. 1). submissions and arguments of the parties may be summarized as follows: The Council considered that, in order to implement the protective measures, it was necessary to lay down procedures I — Facts "for anyone acting on behalf of a Community industry which considers itself injured or threatened by dumped or subsidized imports to lodge a For the purpose of implementing the complaint". As a result Article 5 of common commercial policy and of the Regulation No 3017/79 provides: harmonious development of the external trade of the Community the Council, in Regulation No 459/68 of 5 April 1968 "(1) Any natural or legal person, or any on protection against dumping or the association not having legal per granting of bounties or subsidies by sonality, acting on behalf of a countries which are not members of the Community industry which con EEC (Official Journal, English Special siders itself injured or threatened by Edition 1968 (I), p. 80), created, with dumped or subsidized imports may due regard to the rules laid down in lodge a written complaint. Article VI of the General Agreement on Tariffs and Trade (GATT) and in the Agreement on Implementation of that article, a common system of protection (2) The complaint shall contain against imports from non-member sufficient evidence of the existence countries which are the subject of of dumping or subsidization and dumping or the grant of bounties or the injury resulting therefrom. subsidies.
(3) The complaint may be submitted to Multilateral trade negotiations resulted the Commission, or a Member in 1979 in a new Agreement on State, which shall forward it to the Implementation of Article VI of the Commission. The Commission shall General Agreement (1979 Anti-Dumping send Member States a copy of any Code) and in a new Agreement on complaint it receives. Interpretation and Application of Articles VI, XVI and XXIII of the General Agreement and consequently Regulation (4) The complaint shall be withdrawn, No 459/68 was repealed and replaced by in which case proceedings may be Council Regulation No 3017/79 of 20 terminated unless such termination December 1979 on protection against would not be in the interest of the dumped or subsidized imports from Community.
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(5) "Where it becomes apparant after and export subsidies for soya-bean oil consultation that the complaint cake. It related, more specifically, to four does not provide sufficient evidence types of subsidy: to justify initiating an investigation, then the complainant shall be so The levying of higher export duties in informed. respect of soya beans than in respect of soya-bean oil-cake which is a product derived from them; (6) Where, in the absence of any complaint, a Member State is in possession of sufficient evidence The setting of export quotas for soya both of dumping or subsidization beans with the result that domestic prices and of injury resulting therefrom of soya beans for the Brazilian oil for a Community industry, it shall industry are lower; immediately communicate such evidence to the Commission." The levying of a higher tax on the movement of goods in respect of the export of soya beans than in respect of Pursuant to Article 5 (1) of Regulation soya-bean oil-cake; No 3017/79 the EEC Seed Crushers' and Oil Processors' Federation (Fediol) The granting of a preferential rate of (hereinafter referred to as "the Feder interest for credit in respect of exports of ation"), having its registered office at soya-bean oil-cake. Brussels, lodged a complaint with the Commission on 2 April 1980 by which it The Federation's complaint contained requested the initiation of an anti-sub numerous data intended to prove the sidy proceeding against the Federative existence of such subsidies and to show Republic of Brazil in respect of imports the damage suffered as a result by the of soya-bean oil-cake. Community oil-processing industry.
That complaint followed an earlier anti- Consequently the Federation requested subsidy complaint made by the Feder the Commission once it had undertaken ation in respect of the same commodity the necessary consultations to apply on 3 January 1977 pursuant to the rules Article 7 (1) of Regulation No 3017/79, laid down in Regulation No 459/68; that according to which: initial compaint was, on 14 April 1977, the subject of a notice initiating a "Where, after consultation, it is apparent procedure (Official Journal C 89, p. 7) that there is sufficient evidence to justify and subsequently on 10 December 1977 initiating a proceeding the Commission of a notice of termination (Official shall immediately; Journal C 298, p. 2) because the Commission had received satisfactory (a) announce the initiation of a pro undertakings from the Brazilian ceeding in the Official Journal of Government from which it concluded the European Communities; such that the introduction of protective announcements shall indicate the measures was unnecessary at that time. product and countries concerned, give a summary of the information The complaint lodged by the Federation received, and provide that all on 2 April 1980 was, like the first relevant information is to be complaint, in respect of the direct or communicated to the Commission; it indirect grant by Brazil of production shall state the period within which
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interested parties may make known altered its view of the case; consequently their views in writing and may and in pursuance of Article 5 (5) of apply to be heard orally by the Regulation No 3017/79 the Federation Commission in accordance with was informed that an anti-subsidy paragraph (5); procedure in respect of imports of soya bean oil-cake from Brazil would not be (b) so advise the exporters and importers initiated. known to the Commission to be concerned as well as representatives The Commission added that it would of the exporting country and the continue to watch the development of complainants; the situation in that sector, all the more so since the course of Brazilian policy in (c) commence the investigation at Com credit matters gave rise to concern as munity level, acting in cooperation regards both time-limits and rates. with the Member States; such investigation shall cover both dumping or subsidization and injury resulting therefrom and shall be II — Written procedure carried out in accordance with paragraphs (2) to (8)." On 29 July 1982 the Federation brought an action claiming that the Court should: Brazil abolished one of the contested export duties in April 1980 and the 1. Declare void the decision contained in Federation's complaint was amended the notification of the Commission accordingly by letter of 23 June 1980. dated 25 May 1982 refusing to initiate an anti-subsidy proceeding in respect The statement of facts and law contained of the importation of soya-bean oil in the complaint was concluded by a cake from Brazil; number of observations made by the Federation; consultations took place be 2. Order the Commission to pay the tween the Commission and the Member costs. States and between the Commission and Brazil. Pursuant to Article 91 of the Rules of Procedure the Commission lodged at the By letter of 5 February 1982 the Court on 11 October 1982 a document Commission informed the Federation requesting it to give a preliminary that after detailed examination of its decision on the admissibility of the complaint and as a result of consultations action, to dismiss the application as with the Brazilian Government, it did inadmissible and to order the applicant not intend to initiate an anti-subsidy to pay the costs. procedure. It based its intention on the fact that the contested subsidies were to all intents and purposes no longer being The applicant in the main action, being applied and that their total effect was the defendant in relation to the objection insufficient to justify initiation of a of inadmissibility, submitted its obser procedure. vations on 11 November 1982 in which it requested the Court not to grant the Commission's request that it should give By letter of 25 May 1982 the Com a preliminary decision as to admissibility, mission informed the Federation that the to dismiss the objection of inadmissibility supplementary information and obser and to order the Commission to pay the vations which it had submitted had not costs.
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Upon hearing the report of the Judge- A — The applicant's capacity to institute Rapporteur and the views of the proceedings Advocate General the Court decided to open the oral procedure without holding The Commission contends that the any preparatory inquiry. Federation is not a legal person according to the law of one of the Member States but an association III — Submissions and argu without legal capacity having its ments of the parties pre registered office in Belgium. On a strict sented during the written interpretation of the second paragraph of procedure with regard to Article 173 of the EEC Treaty it has no the admissibility of . the right to institute proceedings or to action appear in court.
The Commission emphasizes that this Nevertheless, takings account of the case is the first one brought before the powers of a procedural nature given by Court concerning the legal position, in Regulation No 3017/79 to associations the context of an anti-dumping or anti- lacking legal personality but acting in the subsidy proceeding, of a complainant or name of a Community industry, it would of an industry in a Member State be illogical to refuse such an association affected by dumping or subsidization. By the right to bring an action; it is way of preliminary proceedings and at therefore appropriate to give a broad the level of general principles, it raises interpretation of the concept of "legal the question whether a complainant such person" within the meaning of the as the applicant is entitled to require the second paragraph of Article 173 of the Commission to commence a formal EEC Treaty. proceeding; that question is closely related to the question whether a The applicant, being the defendant in complainant or any person affected by relation to the objection of inadmis subsidies granted by a non-member sibility, for its part considers that in country has a right to require the accordance with the generally accepted adoption of measures or in particular the principle of examining the reality of the imposition of a countervailing duty. The situation all combinations which are question is of fundamental importance recognized by law and vested with not only for its side-effects in the sphere certain powers, particularly combinations of economic and commercial policy and able to express a collective intent in the its purely political implications but also defence of interests which are legally for its bearing on legal protection in the recognized and protected have in Community. principle legal personality and the capacity to institute legal proceedings. The applicant, being the defendant in relation to the objection of inadmissi bility, does not contest the importance of In any case Article 5 (1) of Regulation the problem of the admissibility of. its No 3017/79 gives "any association not action which must be seen in the more having legal personality" acting on general context of legal protection behalf of a Community industry the right against subsidies and dumping effected to lodge a complaint; it necessarily by non-member countries and the follows that such an association has the resolution of which must take into capacity to institute proceedings under account the legal position in other States the second paragraph of Article 173 of which are parties to GATT. the Treaty.
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B — The question whether the contested (a) With regard to the purpose of the communication is an act of the communication it must be stated that the Commission Commission, pursuant to Article 5 (5) of Regulation No 3017/79, informed the Federation on 25 May 1982 that its request for the initiation of a new anti- The Commission admits that the subsidy proceeding against Brazil did not contested communication (regardless of contain sufficient evidence to justify the its legal nature) must be attributed to it commencement of an investigation. That as an institution although it was only decision was based essentially on the signed by an official; it was certainly a working document annexed to the letter communication issued in the name of the of 5 February 1982; the information Commission of the type provided for in provided was therefore a matter of Article 5 (5) of Regulation No 3017/79. substance.
The applicant considers that the letter of 25 May 1982 does indeed amount to a decision of the Commission with regard The communication did not go beyond to the request to initiate a proceeding. the information provided for in Article 5 (5) : it did not contain any decision since no such act was provided for or covered by that provision. It cannot be conceded C — The question whether the contested that the reference to that provision communication is a decision within simply concealed the real nature of the the meaning of the second paragraph communication and that the legal basis of Article 173 of the Treaty for it must be found in Articles 5 (2), 7 (1) and 9 of Regulation No 3017/79 or in the principles of legal certainty and legal clarity. The Commission is of the opinion that, in order to constitute a decision within the meaning of the second paragraph of Article 173 of the Treaty, it is not sufficient for a communication to have It is true that the regulation is silent on some legal effect; it must have binding the matter of the rejection of a request legal effect so that it brings about a for the initiation of a proceeding. distinct change in the applicant's legal However, the Community legislature position: it is not sufficient if his interests deliberately abstained from including are simply infringed. such formal rules governing the termin ation of the preliminary procedure; it is not possible to deduce from the right to Thus it is necessary to decide whether lodge a complaint within the meaning of the communication sent to the applicant Article 5 (1) and (2) a right to a formal on 25 May 1982 was such as to have decision capable of being subject to such a specific legal effect. The answer is review by the Court. The fact that it is not to be found in the external form of possible to initiate an official inves the measure or in its apparent content tigation does not, in any case, mean that but in the purpose of the compensatory the preliminary procedure which it procedure, regard being had to the follows must be terminated by a decision. applicant's position in relation to the The general principles of law by no whole proceeding. means require such a decision; they may,
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at best, lead the Community institutions relating to agreements, decisions and to provide for a formal closure of the concerted practices. procedure in general or to undertake it in a specific case. Such a step cannot be the subject of an action such as has been It follows by implication but clearly from brought in this case for a declaration that several provisions of Regulation No it is void under Article 173; furthermore 3017/79 (Articles 5 (4) and (6), 6 (1), 7 the action before the Court has not been (7) (a) and 11) that the Commission brought under Article 175. may, as is provided for, furthermore, in Article 2 of the GATT Anti-Dumping Code, commence a compensatory pro (b) With regard to the legal nature of ceeding without a prior complaint having the information provided for in Article 5 been made to it. (5) of Regulation No 3017/79 it should be remembered that: The information given pursuant to Article 5 (5) certainly expressed the The communication sent to the applicant Commission's intention not to initiate an on 25 May 1982 constituted the infor official proceeding within the meaning of mation provided for in Article 5 (5) of Article 7 at that time in the situation the regulation and did not contain any obtaining; however, the discontinuance other decisions going beyond the content of the proceeding is not final: the thereof; Commission may if it thinks fit at any time re-examine the evidence provided by the complainant. Whilst the information indeed contained a declaration of intent on the part of the Commission that it was not proposing to At that stage there cannot yet be a initiate an official investigation within formal proceeding properly so called; at the meaning of Article 7 at that time, it best there is a preliminary examination was nevertheless not a decision capable or proceeding and if, following the of being challenged within the meaning consultations provided for in Article 6, of the second paragraph of Article 173 the examination is not continued it is not of the Treaty. possible to speak of the "termination of the procedure".
The Court's case-law with regard to competition provides hardly any assist The complainant's interests are, without ance in this context; only the statements doubt, affected by the expression of the contained in its judgment of 18 October Commission's intention not to initiate an 1979 (Case 125/78 GEMA [1979] ECR official proceeding at that time; however 3173) could be considered to any degree. the only decisive question is whether the The fact that a complaint does not result fact that the interests have been affected in the action desired does not seem to be in such a manner may be regarded as a of a more definitive nature in an anti distinct change in the complainant's legal dumping proceeding than in connection position and whether it is necessary, with an infringement of competition consequently, to recognize that he has rules; furthermore there are no reasons a legally enforceable right to have to regard the legal position of a an official investigation initiated if complainant as stronger under Regu "sufficient evidence" within the meaning lation No 3017/79 than under the law of Article 5 (2) has been provided.
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(c) With regard to the complainant's phrase "Where . .. the interests of the legal position in the context of the Community call for ... intervention" is compensatory rules the question is too vague for it to be possible to deduce essentially whether Community law gives therefrom legal criteria capable of being him a right to the adoption of protective the subject of judicial review. measures. In fact it does not.
To recognize that the complainant has a According to Article 3 (1) of Regulation right to challenge before the Court a No 3017/79 a countervailing duty may decision of the institutions refusing to be imposed for the purpose of offsetting take action against an exporting country a subsidy; the institution therefore would risk calling in question the results remains free to decide whether or not to obtained by means of negotiation. adopt such measures.
All definitive measures adopted under Article 7 (9) of the regulation provides Regulation No 3017/79 are, by their that a proceeding is concluded either by nature, protective measures falling with its termination or by definitive action. the field of commercial policy, even if The complete absence of any rules they serve to protect national production governing the question whether, when and therefore also coincide with the and under what conditions definitive interests of an individual. It is for the measures must be adopted indicates that legislature to decide whether, in the light the Community legislature intended to of such personal interests, it intends the leave the relevant institution a free hand persons affected to be empowered to in that field. bring an action, in whatever form, against the decisions of the political authorities in that sector; in the area to which Regulation No 3017/79 applies it There is nothing automatic about the has not done so. adoption of definitive measures in the case of injury caused by dumping or subsidization. Definitive measures are to be adopted only if "the interests of In granting a right of complaint the the Community call for Community legislature certainly did not intend to intervention" (Article 12 (1) of the regu give the relevant business circles a right lation); the relevant institutions therefore to bring an action but intended, as in the have a very wide discretion with regard case of classic protective measures in the to policy in defending the interests of the area of commercial policy, simply to give Community and in balancing opposing them the formal opportunity to make interests. In this case it is not just a their opinion known to the Community question of balancing the interests of authorities. consumers and producers but of resolving much more complex conflicts of interest and, above all, of taking into It is not possible to base any argument account the compelling requirements of on the fact that such a right of action trade relations with the non-member exists in other legal systems. GATT and country in question. When considering in particular its code on subsidies leaves whether definitive measures must be completely open the question of how to adopted the Community institutions ensure observance at national level of the ought to have an unlimited discretion rules of conduct applicable in inter free from review by the Court. The national law.
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If a complainant has no right to require The idea that the Commission, which the Community to adopt protective is the political institution having measures against a non-member country responsibility at the preliminary stage, is then he cannot have a right to the able to refuse to initiate and conduct an initiation of an official investigation official investigation if such is not in the either. Community interest and that in that respect it possesses a discretion which is not subject to review by the court, is consistent with Articles 5 and 7 of Regu lation No 3017/79 even in the absence of an express reference in Article 5 (5) to The recognition of such a purely pro the interests of the Community being cedural right does not give the taken into account. Apart from require complainant any benefit in the legal ments as to admissibility, Articles 5 (5) sphere except the opportunity to produce and 7 (1) require the complaint to to the Commission additional evidence provide sufficient evidence "to justify which might, in an appropriate case, initiating a proceeding"; the Commission alter its attitude; the existence of that must therefore check that all the opportunity is, however, insufficient to circumstances of the case, not only the change the complainant's legal position. aspects of dumping, subsidy and injury but also all other relevant circumstances and in particular the general interests of the Community, justify the initiation of an investigation. Above all it must be entitled to refuse to initiate a proceeding Moreover, the probable effect of the where it is convinced that, at the stage of recognition of such a right would be to a preliminary investigation, it would not subject the subsequent conduct of the be in the interests of the Community to competent authority to judicial review as adopt definitive measures. well, at least in part: the right to the initiation of a proceeding would hardly be consistent with the grant to the Commission or the Council of an absolute discretion to arrive at a The intervention of the Member States decision; at the very least it would imply in that preliminary examination in the review of any misuse of power and context of the consultations prescribed in involve a significant restriction of the any event is justified by the fact that discretion of the Community institutions. the question of what is appropriate in the circumstances must be taken into account, as is shown in particular by Article 6 (4) (d) of the regulation.
The initiation of an official proceeding is itself a measure which is not without effect on trade and relations with the The fact that the complainant is thus non-member country in question; it is deprived of all legal protection against therefore for the political institution the Commission or the Council in responsible for commercial -policy to relation to anti-subsidy legislation cannot decide whether it is appropriate to alter the fact that the protective measures initiate a proceeding having such effects. in question are, by their nature, measures That is particularly the case in relation to falling exclusively within the area of compensatory measures. commercial policy which are adopted, as
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are all measures provided for in Article context of the consultations provided for 113 of the EEC Treaty, primarily in the in Article 6; general economic interest and prevail over the interests of individuals. The fact After such examination the Commission that the protective measures are intended has the opportunity either to initiate the to safeguard Community industiy is not official proceeding provided for in sufficient to give them a substantially Article 7 or not to initiate such a different nature. proceeding "in the circumstances" and to inform the complainant thereof in
accordance with Article 5 (5); There is no provision of Community law which categorizes export subsidies granted by non-member countries as The complainant is entitled to be so "illegal"; the relevant matter is the informed and may, in default, bring the objective circumstances, falling within action provided for in the second the domain peculiar to the non-member paragraph of Article 175 of the Treaty country in question, to which it is for failure to act; possible to react through the instruments of commercial policy permitted by The complainant nevertheless has no
GATT. In that respect there is a sub right to force the Commission to initiate stantial difference as against competition an official proceeding; accordingly a law, in the context of which measures decision not to proceed pursuant to which have the effect of distorting Article 5 (5) may not be challenged competition must, in fact be categorized under the second paragraph of Article as illegal; it is therefore not surprising 173 of the Treaty. that, in contrast to competition law, anti dumping and anti-subsidy legislation The applicant considers the communi does not, in the last resort, grant any cation of 25 May 1982 to be a definitive protection to the persons affected by the decision which brings to an end the conduct of third parties. complaints procedure within the meaning of the third paragraph of Article 189 of the EEC Treaty, which expresses the The references to GATT and its code Commission's refusal to initiate an anti- concerning subsidies do not apply in this subsidy proceeding and which affects his case: the introduction of countervailing rights; such a decision is capable of being duties is not a necessary and automatic the subject of proceedings under the reaction to subsidies which do not second paragraph of Article 173 for a conform to GATT and the provisions in declaration that it is void. question amount for the contracting parties to obligations under international law which, according to the Court's (a) The communication constitutes the case-law, do not have direct effect in Commission's definitive decision on the Community law. complaint of 2 April 1980: it was in that communication that the Commission,
after it had adopted a provisional (d) Finally, the relevant provisions of attitude more than once, expressed its Regulation No 3017/79 must be view in an unequivocal and definitive interpreted in the following manner: manner and in a form which made it possible to identify its nature. By that decision the request made by the Any complaint satisfying the conditions Federation was rejected and the first laid down in Article 5 (3) must be essential stage of an- anti-subsidy examined by the Commission in the proceeding was brought to a negative
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conclusion because the grounds and in the absence of a complaint: the evidence presented by the Federation Community legislature has not laid down were not considered to be sufficient to in Article 5 of Regulation No 3017/79 in justify the initiation of a proceeding. The precise terms such a right on the part of Commission's undertaking to "continue the Commission to act on its own to watch developments in the situation initiative, thus showing the importance carefully" is irrelevant. attached to a complaint emanating from the industry in question.
The require ment that a complaint be lodged arises The declaratory nature of the contested from the urgent need to protect the communication is quite clear: the Community in question, which is in the Commission refused, formally and best position to decide whether it is definitively, to initiate an anti-subsidy suffering damage, to determine its cause proceeding despite the request contained and to assess its effects. in the complaint; the preliminary pro cedure was in fact brought to an end by a decision; without such a decision the The position is completely different from applicant would have brought an action that found in the field of competition: under Article 175 of the Treaty for a there the Commission is under a duty, in failure to act. its capacity as guarantor of competition, to establish infringements of Articles 85 The contested decision is not merely or 86 of the Treaty and to require the informative: its alleged informative undertakings to bring to an end the nature is restricted to the fact that the infringements so established; moreover, Commission referred, formally and with regard to the anti-dumping pro erroneously, to Article 5 (5) of Regu cedure it is necessary, in order to be able lation No 3017/79; in substance it does to request the initiation of a proceeding, not amount according either to its to prove damage on the basis of very contents or to its function, to the specific criteria and not only to prove the provision of information within the mere existence of a legitimate interest. meaning of that provision. The preliminary procedure must necessarily be terminated by a formal (b) It follows from the whole of the decision providing for either the scheme laid down by Articles 5 to 7 of commencement or the renunciation of a Regulation No 3017/79 that the pre
proceeding. The need for a formal liminary procedure is brought to an end decision arises all the more from the fact by a decision within the meaning of the that the relevant provisions lay down not second paragraph of Article 173 of the only the conditions for lodging a Treaty. complaint but also the rules governing the course of the procedure. The preliminary procedure was separate from an investigation properly so called It is incorrect to maintain that the (Articles 7 to 9 of the regulation); they Community legislature has voluntarily are two independent phases, each subject abstained from providing formally for to very specific conditions. the termination of the preliminary
procedure: Regulation No 3017/79 The independent nature of the procedure refers expressly to two possibilities, for lodging a complaint is not weakened namely the initiation of a proceeding by the fact that, according to the anti- (Article 7 (1)) and its termination subsidy code, the Commission may act (Article 5 (4)). The view that the
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Commission may at any time re-examine the unjustified refusal to initiate an the evidence submitted in the complaint investigation the complainant is deprived is incorrect and somewhat theoretical: of all the procedural guarantees provided anti-dumping and compensatory pro for by Article 7 of the regulation before ceedings presuppose up-to-date evidence the Commission adopts the decision to of dumping or subsidization as well as of terminate the proceeding if it appears the injury suffered during a specific that protective measures are unnecessary. period; since the Commission is unable to act on its own initiative it may at the most request the complainant to bring the complaint up-to-date or to lodge a The refusal to initiate a proceeding in fresh one. the given circumstances amounts a priori to a refusal to adopt protective measures unless the Commission has acquainted
itself, on the basis of its own In that respect it is not possible to base investigations, with the existing subsidy any argument on the decision in the and its effects. The termination of the GEMA case: in this case a decision has preliminary procedure is not therefore been adopted by the Commission and, "justified" within the meaning of Article furthermore, anti-dumping proceedings, 7 (1) of the regulation. unlike proceedings in respect of agreements, decisions and concerted practices, require a complaint, supported comprehensively by reasons, the receipt The protection given with regard to of which by the Commission constitutes procedure conditions the protection the commencement of the first stage of granted by the substantive provisions the formal procedure. and guaranteed by the provisions of constitutional law of which an industry
and the undertakings belonging to it ought to have the benefit against (c) The rejection of a request to initiate subsidies which cause them injury. an anti-subsidy proceeding jeopardizes the legal position of the whole European oil-processing industry, on behalf of which the complaint was lodged. State subsidies must be regarded as illegal at least in those cases where they cause injury. By analogy with Article 92 of the EEC Treaty and with regard to That damage consists first of its being the anti-subsidy code of GATT the deprived of the right to have established, contested subsidies are illegal measures by an investigation conducted by the from the point of view of public inter Commission, whether the conditions national law and this accordingly justifies explained in a convincing manner and the imposition of a countervailing duty. proved at least prima facie do in fact exist The subsidies are, at the same time, the and must lead to protective measures cause of injury suffered by the oil- within the meaning of Articles 10, 11 processing industry as Community
and 12 of Regulation No 3017/79. That producers and the injury is known to the denial of justice is all the greater since Commission. The purpose of Regulation the Commission alone has the power to No 3017/79 is to prevent, by means of carry out the necessary investigations anti-subsidy measures, interference, such and it alone has the opportunity to as that suffered in this case by the collect the necessary information and Community oil-processing industry, with to place it in a wider context. By the existence of and the right to engage
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in a commercial activity organized by the investigation the decision is also capable undertakings in question. The refusal to of being the subject of an action under initiate an anti-subsidy proceeding the second paragraph of Article 173 of deprives formal and substantive rights of the EEC Treaty. any protection.
With regard to the complainant's right to The Commission's argument that the the adoption of protective measures it is protective measures are, according to necessary to state first that the present their nature in law, "measures belonging procedure does not relate to such exclusively in the area of commercial measures; the question of protective policy . . . adopted essentially in the measures only arises, furthermore, when general economic interest" is not the Commission has initiated an acceptable. A "Community industry" investigation and has proceeded to carry (Article 4 of Regulation No 3017/79), out its own investigations and inquiries. comprising all the producers of similar The subject of this action is the products in the Community, lies at Commission's refusal to initiate an the centre of the anti-dumping and investigation. compensatory proceeding. Requests for the initiation of a proceeding must be lodged on behalf of a Community indus try and the injury must be determined by In any case, by refusing to initiate an reference to the Community industry in investigation on the ground that the question. The specific implementation of applicant has no right to the adoption of protection against injurious subsidies by protective measures, the Commission is the GATT Code and Regulation No prejudging a decision which is absolutely 3017/79 which is based on it quite incapable of being adopted before it has deliberately reduced the aspects con carried out its own investigations and cerned with commercial policy and the which, in the final analysis, falls within general economic interest to a great the Council's competence. degree; that is confirmed by the fact that the right to lodge a complaint is granted in the first place to the industry in question. The purpose of Regulation No The basic provision concerning the 3017/79 in giving protection therefore termination of an investigation is Article requires the industry concerned to 9 (1) of Regulation No 3017/79. benefit from a strong legal position and According to that provision a com formal rights in the proceedings pensatory proceeding is only to be following the complaint. terminated if it is apparent that "pro tective measures are unnecessary"; in fact that is only the case if the Commission's investigations have shown The need to bring to an end by a that the necessary conditions (subsidies, decision the proceeding commenced by damage, causal relationship) are absent. a complaint, the legal position of It is not possible to speak in that respect complainants and the purpose of the of a free discretion. regulation in giving protection oblige the Commission to adopt a decision. In this case the decision was adopted definitively and irrevocably in the form Moreover the Commission may only of the communication of 25 May 1982; decide to terminate an investigation if no inasmuch as it refuses to initiate an objection has been expressed in the
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Advisory Committee on Protection nary procedure the Commission must against Dumped or Subsidized Exports. therefore restrict itself to considering The Commission's view encroaches on whether there is "sufficient evidence" the powers of the Member States and of within the meaning of Article 5 (2) of the the Council, which are able to come to a regulation; if so, the initiation of a decision on the need for protective proceeding is not only justified but also measures only on the basis of the necessary. inquiries conducted by the Commission in the course of an investigation. The course of the investigation, as provided for in Article 7 of Regulation In the case of a damaging subsidy there No 3017/79, shows that the concept is a right to the adoption of protective of "Community interest" acquires
measures. According to the Court's importance only after the proceeding has case-law the undertaking carrying out been initiated and the investigation live dumping or the State granting a carried out. subsidy has a right to take legal action against protective measures adopted in The concept of "Community interest" is the form of an anti-dumping or counter of little actual importance in anti vailing duty; the Community industiy dumping and compensatory proceedings. which is injured by the dumping or sub The decisions of the Community sidization must, all the more, have institutions in such proceedings to the the right to require the competent present time have, in a manner of Community institutions, after the facts speaking, involved practically no specific have been established, to adopt the consideration of the Community interest; necessary protective mesures.
Regulation the Commission has always been con No 3017/79 was adopted in order to cerned to apply the law strictly, that is to protect the industry in question; the say to decide on protective measures Commission might destroy the right to when the necessary conditions (subsidies, the adoption of the measures necessary injury and causal relationship) were to provide that protection if it refused, present. despite the existence of a complaint supported by convincing evidence, to initiate an investigation and therefore The Commission's arguments in that determine the facts. connection are very general and theoretical: it does not cite any specific reason for refusing, from the point of In addition, the existence of a "dis view of the Community interest, the cretionary power free from review by initiation of a compensatory proceeding the Court " with regard to the decision against the importation of soya-bean oil whether to initiate and conduct an cake from Brazil.
Its purpose is, in fact, investigation cannot be deduced from the to obtain judicial recognition of a concept of "Community interest". discretionary power free from control by the Court in relation to the initiation of a compensatory proceeding. This case In contrast to Article 12, Article 7 of the shows how dangerous such recognition regulation, which lays down the would be for the protection of the conditions for the initiation and conduct applicant: the Commission has already of an anti-subsidy proceeding, makes no established in 1977 that Brazil had paid . reference to the concept of Community illegal subsidies and it has twice failed
interest. When adopting a decision con to fulfil its promise to abolish them. cerning the termination of the prelimi In those circumstances to refuse the
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applicant the legal protection it is practice of the other contracting parties entitled to by invoking the Community to GATT and especially of the United interest would make a mockery of the States of America; in fact such States principle of a fair procedure which is allow the industry affected wide powers derived from the principle of legality. to bring an action.
Considerations of commercial policy may certainly be taken into account in (d) To regard the Commission's letter the decision-making process in the of 25 May 1982 as a decision which is context of the concept of "Community capable of being the subject of legal interest"; however, they ought not be proceedings corresponds to the re pleaded in order to give preference to quirements of legal protection properly the maintenance of good relations with a understood and to a precise application trading partner over the interests of the of the rules governing anti-dumping and Community industry which is suffering anti-subsidy proceedings. If that should injury. Brazil, which is a party to the not be the case it would be simple for Agreement on Interpretation and the Commission to decide, internally, Application of Articles VI, XVI and without being bound by law and without XXIII of GATT, knows the rights and the protection of the Court, which duties arising therefrom and cannot proceedings to accept and which to object to a compensatory proceeding reject. However, no such discretion is conducted by its commercial partners in given to it by Articles 5 to 7 of Regu accordance with the rules of that lation No 3017/79. Agreement. Regard being had to Brazil's conduct, the Commission and the Council need be in no way constrained; the Commission has, furthermore, adopted a very different attitude to the same country in other sectors. IV — Oral procedure
Anti-dumping and anti-subsidy proceed ings certainly constitute measures to protect trade according to the scheme of At the sitting on 15 March 1983 the the EEC Treaty; however, specific Commission, represented by P. Gilsdorf, expression has been given to such assisted in part by Hans-Friedrich measures to protect trade in the form of Beseler, Director in the Directorate special codes made under GATT, in General for External Relations, and the particular in order to reinforce rights and Federation, represented by D. Ehle, obligations of the industry in question. presented oral argument with regard to the admissibility of the action and replied to questions put by the Court.
In the context of the interpretation of Regulation No 3017/79 it is essential to take into account, according to the fifth The Advocate General delivered her recital in the preamble thereto, the opinion at the sitting on 31 May 1983.
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Decision
1 By application lodged at the Court Registry on 29 July 1982 the EEC Seed Crushers' and Oil Processors' Federation (Fediol) (hereinafter referred to as "the Federation") brought an action under the second paragraph of Article 173 of the EEC Treaty for a declaration that a communication dated 25 May 1982 by which the Commission informed the applicant pursuant to Article 5 (5) of Council Regulation No 3017/79 of 20 December 1979 on protection against dumped or subsidized imports from countries not members of the European Economic Community (Official Journal 1979, L 339, p. 1) that an anti-subsidy proceeding would not be initiated in respect of imports of soya-bean oil-cake from Brazil, was void.
2 By a document lodged on 11 October 1982 the Commission, pursuant to Article 91 of the Rules of Procedure, requested the Court to give a pre liminary decision on the admissibility of the action.
3 It appears from the file that on 2 April 1980 the Federation lodged a complaint with the Commission in which it referred to the subsidization of exports of soya-bean oil-cake by the Federative Republic of Brazil and invited the Commission to initiate an anti-subsidy proceeding under Regu lation No 3017/79, to ask the Brazilian Government for explanations and to impose a provisional countervailing duty.
4 In that complaint, later supplemented by further information, the Federation states that Brazil subsidizes its exports of soya-bean oil-cake by a combination of various measures: on the one hand it exerts pressure by means of export restrictions on the domestic price of soya beans so that they are preferentially reserved at a reasonable price for national industry; on the other hand it gives preferential treatment to exports of soya-bean oil-cake by domestic fiscal measures, by levying different duties on exports of soya beans and of soya-bean oil-cake and by the grant of credit facilities for exports of soya-bean oil-cake. As a whole the measures are intended, it is alleged, to encourage the development of the Brazilian soya seed-crushing industry and they create serious difficulties for the European industry thereby jeop ardizing its profitability.
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5 It is not disputed that the Commission investigated the practices of which the Federation complained, that it entered into negotiations with the Brazilian Government and achieved some results and that, finally, it kept the applicant informed of those discussions.
6 On 30 September 1981 the Federation served notice on the Commission under the second paragraph of Article 175 of the EEC Treaty calling upon it to initiate an anti-subsidy proceeding against Brazil without delay. In the same letter it informed the Commission that it would bring the matter before the Court of Justice and that it reserved the right to hold the Community responsible for the damage caused to it by the refusal to impose a counter vailing duty.
7 By a telex message of 4 December 1981 the Commission informed the applicant of the progress of the discussions held with the Brazilian mission in accordance with the terms of the GATT Anti-Subsidy Code and, at the same time, gave notice that it did not for the time being intend žo initiate an anti- subsidy proceeding.
8 On 5 February 1982 the Commission sent to the applicant a working document dated 4 February 1982 in which it considers, on the one hand, the various Brazilian measures impugned by the Federation and, on the other hand, the question of the damage suffered by the European industry. In that memorandum the Commission states that the majority of the measures of which the applicant complained had in the meantime been withdrawn by Brazil and that the effect of the remaining measures was to leave a rate of subsidization which was economically negligible. It states that in those circumstances it seems to it "inappropriate" to initate an anti-subsidy proceeding and recalls that a complete assessment of the case requires the consideration not only of the interests of the European industry but also those of consumers.
9 On 5 March 1982 a meeting took place between officers of the Commission and the Federation's representatives. As a result of that meeting the Commission on 25 May 1982 sent the applicant a letter signed by the responsible director in the Directorate General for External Relations, in
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which it referred to the aforementioned correspondence and stated as follows :
"For that reason, and in accordance with Article 5 (5) of Council Regulation (EEC) No 3017/79, I am writing to let you know that an anti-subsidy proceeding in respect of imports of soya-bean oil-cake from Brazil is not being initiated by the Commission.
I should like to add, however, that the Commission will keep a close watch on developments in the situation in that sector, particularly as the trend of Brazilian policy relating to credit is such as to give rise to a certain concern, with regard both to time-limits and to rates."
10 The Federation brought an action under the second paragraph of Article 173 of the Treaty for a declaration that that communication was void.
11 In its objection of inadmissibility the Commission contends that its communi cation of 25 May 1982 constitutes a mere transmission of information in pursuance of Article 5 of Regulation No 3017/79 and that it does not involve any decision having any other scope. In the Commission's view the regulation, whilst recognizing the right on the part of undertakings and federations to lodge a complaint, does not confer on them the right to compel the initiation of an anti-subsidy proceeding. The Commission emphasizes the wide discretion reserved to it in the regulation and states that the exercise of that discretion touches upon the economic and political interests of the Community and of the non-member countries affected. The purpose of the regulation, it states, is not only to protect European industry, but also to safeguard the general interests of the Community in all their complexity.
12 On those grounds the Commission takes the view that its letter of 25 May 1982 cannot constitute a measure open to challenge under the second paragraph of Article 173 and that the action is therefore inadmissible.
13 The applicant, for its part, considers that Regulation No 3017/79 imposes on the Commission a duty to initiate an official investigation under Article 7 as
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soon as sufficient evidence to show the existence of a subsidy and injury suffered by the European industry has been submitted to it during the pre liminary stage of the procedure. Once those facts have been established the Commission, it is alleged, no longer has any discretion with regard to the inferences to be drawn from them.
1 4 Consequently the applicant considers that where there is a subsidy and resultant injury Community producers have the right to require the competent Community institutions to adopt the necessary protective measures once they have established the facts. The applicant considers that it is entitled at the present stage, regard being had to the evidence it has adduced, to require the Commission to commence the formal investigation stage provided for by Article 7 of the regulation.
15 That claim must be assessed in the light of the whole scheme of investigation and protection created by Regulation No 301/79. The applicant's rights must be defined in the context of that scheme.
16 According to the wording of Article 5 (1) and (3) any undertaking or association of undertakings in the Community which considers itself injured or threatened by subsidized imports has the right to lodge a complaint with the Commission, or a Member State, which is under a duty to forward it to the Commission. After the complaint has been submitted the governments of the Member States must be consulted in the manner provided for in Article 6 of the regulation.
17 The scope of the consultations to be carried out by the Commission at that stage is defined in Article 6 (4) which sets out the matters to be included in the preliminary consultations in respect of every decision, namely: the existence of a subsidy and the amount thereof, the existence and extent of injury, the causal link between the subsidized imports and injury and, finally, the type of measures which are appropriate to prevent or remedy the injury caused by the subsidy.
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18 If, after having carried out consultations on those various matters, the Commission considers that the complaint does not contain sufficient evidence to justify the initiation of an investigation it must so inform the complainant.
19 However, if the Commission considers that there is sufficient evidence to justify initiating a formal investigation, it must, according to Article 7, take a number of measures to publicize the fact, including an announcement in the Official Journal and it must cany out research, either directly or indirectly or in conjunction with the Member States. According to the wording of Article 7 (4), (5) and (6) the information obtained by the Commission must, subject to certain exceptions, be made available to the complainants. On their request the complainants must be heard by the Commission and they may also request the Commission for an opportunity to meet other parties directly concerned with the investigation. At that stage, according to the wording of Article 7 (7), the Community authorities may reach preliminary determi nations or apply provisional measures, which must take effect "ex peditiously".
20 In order to allow the elimination or neutralization of any effects produced by the subsidy the regulation provides a series of measures consisting of the acceptance of undertakings on the part of the country of origin or of the country exporting the products in question, of the imposition of a provisional countervailing duty and a definitive countervailing duty.
21 Article 10 of the regulation contains detailed provisions concerning the undertakings offered and also provides for measures to be taken in the event of the undertakings not being fulfilled. The undertakings are to be accepted by the Commission after the consulations provided for in Article 6 have taken place.
22 h< T T Commission, acting at the request of a Member State or on its own initiative may, according to Article 11, impose a provisional countervailing duty where a preliminary investigation shows that a subsidy exists and where there is sufficient evidence of injury caused thereby and the interests of the Community call for intervention to prevent injury being caused during the proceeding. The imposition of such duties is subject to the requirement of
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consultation provided for in Article 6 except in cases of extreme urgency. Article 11 (4) provides that the Commission shall be required to inform the Council and the Member States forthwith of any decision concerning pro visional duties.
23 According to Article 12, where the facts as finally established by the Commission show that there is subsidization and injury caused thereby and the interests of the Community call for Community intervetion, a definitive countervailing duty is to be imposed by the Council, acting by a qualified majority on a proposal submitted by the Commission after consultation.
24 It must be noted that, according to Article 13 (1), countervailing duties, whether provisional or definitive, are to be imposed by regulation.
25 It appears from a comparison of the provisions governing the successive procedural stages described above that the regulation recognizes the existence of a legitimate interest on the part of Community producers in the adoption of anti-subsidy measures and that it defines certain specific rights in their favour, namely the right to submit to the Commission all evidence which they consider appropriate, the right to see all information obtained by the Commission subject to certain exceptions, the right to be heard at their request and to have the opportunity of meeting the other parties concerned in the same proceeding, and finally the right to be informed if the Commission decides not to pursue a complaint. In the case of the proceedings being terminated on the completion of the stage of preliminary investigation provided for in Article 5 that information must comprise at least a statement of the Commission's basic conclusions and a summary of the reasons therefor as is required by Article 9 in the event of the termination of formal investigations.
26 Whilst it is true that the Commission, when exercising the powers assigned to it in Regulation No 3017/79, is under a duty to establish objectively the facts concerning the existence of subsidization practices and of injury caused thereby to Community undertakings, it is no less true that it has a very wide
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discretion to decide, in terms of the interests of the Community, any measures needed to deal with the situation which it has established.
27 It is in the light of those considerations, originating in the scheme of Regu lation No 3017/79 that it is necessary to decide whether complainants have the right to bring an action.
28 It seems clear, first, in that respect — and the point is not disputed by the Commission — that complainants must be acknowledged to have a right to bring an action where it is alleged that the Community authorities have disregarded rights which have been recognized specifically in the regulation, namely the right to lodge a complaint, the right, which is inherent in the aforementioned right, to have that complaint considered by the Commission with proper care and according to the procedure provided for, the right to receive information within the limits set by the regulation and finally, if the Commission decides not to proceed with the complaint, the right to receive information comprising at the least the explanations guaranteed by Article 9 (2) of the regulation.
29 Furthermore it must be acknowledged that, in the spirit of the principles which lie behind Articles 164 and 173 of the Treaty, complainants have the right to avail themselves, with regard both to the assessment of the facts and to the adoption of the protective measures provided for by the regulation, of a review by the Court appropriate to the nature of the powers reserved to the Community institutions on the subject.
30 If follows that complainants may not be refused the right to put before the Court any matters which would facilitate a review as to whether the Commission has observed the procedural guarantees granted to complainants by Regulation No 3017/79 and whether or not it has committed manifest errors in its assessment of the facts, has omitted to take into consideration any essential matters of such a nature as to give rise to a belief in the existence of subsidization or has based the reasons for its decision on considerations amounting to a misuse of powers. In that respect, the Court is required to exercise its normal powers of review over a discretion granted to
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a public authority, even though it has no jurisdiction to intervene in the exercise of the discretion reserved to the Community authorities by the aforementioned regulation.
31 It follows from the foregoing that the attitude adopted by the Commission is excessive inasmuch as it considers that any action brought by the complainants described in Article 5 of the regulation is, in principle, inadmissible. As has been shown above, the regulation acknowledges that undertakings and associations of undertakings injured by subsidization practices on the part of non-member countries have a legitimate interest in the initiation of protective action by the Community; it must therefore be acknowledged that they have a right of action within the framework of the legal status which the regulation confers upon them.
32 It is therefore for the applicant to put forward its submissions in the course of the subsequent proceedings and to show that they fall within the limits of the legal protection given to it by Regulation No 3017/79 and by the general principles of the Treaty.
33 For all those reasons the application must be declared admissible and the proceedings must be allowed to continue .
Costs
34 The costs should be reserved.
On those grounds ,
THE COURT ,
be way of interlocutory decision, hereby:
1. Declares the action to be admissible;
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2. Reserves the costs.
Mertens de Wilmars Pescatore O'Keeffe
Everling Mackenzie Stuart Bosco Koopmans
Due Bahlmann Galmot Kakouris
Delivered in open court in Luxembourg on 4 October 1983.
For the Registrar H. A. Rühl J. Mertens de Wilmars Principal Administrator President
OPINION OF MRS ADVOCATE GENERAL ROZES DELIVERED ON 31 MAY 1983 1
Mr President, Processors' Federation (Fediol) (herein Members of the Court, after referred to as "the Federation"), which has its registered office in Brussels, for a declaration that a decision This action is brought under the second alleged to have been contained in a letter paragraph of Article 173 of the Treaty of the Commission of 25 May 1982 by the EEC Seed Crushers' and Oil refusing to initiate an anti-subsidy 1 — Translated from the French.