C-348/82

(ECSC Treaty, Art. 58; General Decisions No 1831/81 and No 1832/81)

In Case 348/82

INDUSTRIE RIUNITE ODOLESI SPA , whose registered office is in Odolo (Brescia, Italy), represented by Desiderio Leali, Managing Director, and by Gino Alberto Bergmann, of the Milan Bar, Fabrizio Massoni, of the Brussels Bar, and Gerolamo Pellicano, of the Milan Bar, with an address for service in Luxembourg at the Chambers of André Elvinger, 15 Côte d'Eich,

applicant, v

COMMISSION OF THE EUROPEAN COMMUNITIES, represented by Sergio Fabro, a member of its Legal Department, with an address for service in Luxembourg at the office of Oreste Montako, Jean Monnet Building, Kirchberg,

defendant, 1 — Language of the Case: Italian.

JUDGMENT

Facts and Issues

The facts of the case and the system of production quotas for products conclusions, submissions and arguments of the steel industry, subject to certain of the parties may be summarized as amendments, to cover the period follows : between 1 July 1981 and 30 June 1982.

I — Facts and procedure According to Article 5 of Commission Decision No 1831/81/ECSC the Com­ Faced with a manifest crisis in the steel mission is to fix production quotas on a market within the meaning of Article 58 quarterly basis for several groups of of the ECSC Treaty, the Commission, by products. According to Articles 6 to 10, general Decision No 2794/80/ECSC of those quotas are to be fixed for each 31 October 1980 (Official Journal L 291, undertaking on the basis of the reference p. 1), instituted a monitoring system and production of that undertaking and by a system of production quotas for the the application of abatement rates to the period between 1 November 1980 and reference production. Article 9 provides 30 June 1981. By general Decision No that the Commission is to inform each 1831/81 of 24 June 1981 (Official undertaking of its reference production Journal L 180, p. 1), the Commission and the production quotas resulting from extended the monitoring system and the an application of the abatement rates.

IRO / COMMISSION

The applicant protested in various letters against the refusal of its request, but did not take any legal action. II — Conclusions of the parties

By Decision No C(82) 1631/3 of 24 November 1982 the Commission The applicant claims that the Court found that the applicant had exceeded should: the production quota allocated to it for the third quarter of 1981 by 4 999 tonnes 1. On a preliminary basis, suspend the in respect of product Categories V operation of the Commission De­ (reinforcing bars) and VI (merchant cision of 23 November 1982; bars). On that basis, it imposed a fine of 374 925 ECU, or LIT 502 601 959. The applicant was notified of that decision on 2. Declare the contested decision void; 6 December 1982. 3. In the alternative, reduce the fine By application lodged at the Court imposed by the aforementioned de­ Registry on 31 December 1982, the cision;

JUDGMENT OF 15. 3. 1984 — CASE 348/82

According to the applicant, the Com­ Ill — Submissions and arguments mission's conduct in this case is of the parties manifestly incompatible with Article 14 of Decision No 2794 / 80 / ECSC , pur­ suant to which the Commission may The applicant does not contest the facts modify the quotas where exceptional alleged in the decision. It acknowledges difficulties are entailed. in particular that it exceeded the quota allocated to it for the third quarter of 1981. It points out however that that was The applicant also considers that the caused by production intended for Commission, by refusing to adjust the export to Libya, whose order had been quotas at the time, did not take account accepted on 6 April 1981, that is, before of Article 14 of Decision No 1831 / 81 / Decision No 1831/81/ECSC came into ECSC, as amended by Decision No force. It accepted that order believing 1832/81/ECSC. In so far as it is relevant that exports to non-member countries to this case, that article is formulated in were encouraged by the Commission, the the following terms : applicant having obtained, for the fourth quarter of 1980, an adjustment of its production quota so as to be able to "If, by virtue of the scale of the fulfil an exceptional contract for export abatement rates imposed in respect of a to Libya. The Commission authorized given quarter, the quota system creates that adaptation by a letter of 23 No­ exceptional difficulties for an under­ vember 1980, emphasizing in particular taking, the Commission shall make that it was "in the interest of the suitable adjustments to the reference Community steel industry to maintain production for the categories in question these patterns of exports." (. . .) in the following instances:

The total reference production for Cate­ 1831/81/ECSC, since the applicant's gories V and VI comes to less than situation at that time did not correspond 60 000 tonnes and the abatement rate to one of the conditions laid down. exceeds 20 %." Article 14 makes any adjustment of the quota subject to a condition relating to production, which, as regards products in Categories V and VI, must be less than 60 000 tonnes per year whereas the According to the applicant, the above- applicant had a reference production of mentioned Article 14 leaves the Com­ 102 706 tonnes per year. mission no discretion, but rather requires it to adjust the quotas if, as in this case, the conditions are met. Furthermore, during the reference period of three years, the applicant undertaking has Finally, the Commission points out that already reduced its production by 75 %, the applicant had already had the benefit putting its survival in jeopardy. In those of adjustments of its quota for the fourth circumstances, the Commission was not quarter of 1980 so as to be able to export entitled to refuse to adjust its quota. to non-member countries. It was also What is more, that penalty imposed upon allowed to produce during the first it by the contested decision is completely quarter of 1981 the additional quota inequitable. granted for those exports. Furthermore, the applicant obtained, pursuant to Decision No 2794/80/ECSC, two other reappraisals of its production quotas relating to the first and second quarters The Commission considers all the of 1981. In calculating the new quotas applicant's observations to be without for the third quarter of 1981, the foundation. Commission applied Article 7a of De­ cision No 1832/81/ECSC, according to which the calculation of the reference production for the new quotas is to take account of the quotas allocated during In the first place, it is impossible to the period of application of Decision understand why the applicant, having No 2794/80/ECSC, including all the received a major order for export to adjustments granted pursuant to that Libya on 6 April 1981, did not decision. Consequently, the Commission immediately seek an adjustment of its considers that it has taken proper quota because of the exceptional exports account of the applicant's special but waited until July 1981 before doing situation. so. That request, based on Decision No 2794/80/ECSC, is absolutely inad­ missible because at the date on which it was made, Decision No 2794/80/ECSC was no longer in force. The Commission is opposed to a reduction in the fine imposed, because the applicant itself took the risk of filling a large order knowing that there was a system of production quotas leaving very In the second place, the Commission little room for manoeuvre. The applicant contends that the adjustment requested undertaking should have restricted itself on 14 July 1981 could not be granted to producing the tonnage allowed under pursuant to Article 14 of Decision No its quota for the third quarter of 1981.

IRO / COMMISSION

informed the applicant that it was "in the interest of the Community steel industry to maintain these patterns of export".

4 On the basis of these allegations of fact, the applicant claims first of all that the Commission was required to adjust its quota, both on the basis of Article 14 of general Decision No 2794/80/ECSC of 31 October 1980 establishing a system of steel production quotas for undertakings in the iron and steel industry (Official Journal L 291, p. 1) and on that of general Decision No 1831/81/ECSC of 24 June 1981 establishing for undertakings in the iron and steel industry a monitoring system and a new system of production quotas in respect of certain products (Official Journal L 180, p. 1).

s The applicant then invokes the same circumstances in support of its contention that the amount of the fine imposed upon it is disproportionate to the offence committed. It points out that its undertaking, which is small in size, could not have survived the loss of the Libyan contract which the abandonment of the new Libyan order would have entailed.

6 It must be pointed out first of all that the first of these two submissions amounts to a challenge to the legality of the decisions of 4 and 7 August 1981 by which the Commission respectively determined the applicant's production quota for the third quarter of 1981 and refused the applicant's request to adjust the quota. However, those decisions have become definitive by virtue of not having been contested within the periods provided by the Treaty. It is clear from an established body of case-law that an applicant cannot, in the course of an application directed against an individual decision, put forward an objection of illegality against other individual decisions addressed to it, which have become definitive.

9 It is necessary in this context to examine the factual circumstances in which the infringement at issue was committed. Whilst it is true that the applicant did not request the adjustment of its quota when it accepted the Libyan order in April 1981 and that it made such a request only towards the middle of July, referring to general Decision No 2794/80 which had already expired, it is also true that during the months of May and June 1981, when the applicant was starting to fulfil the Libyan order, the undertakings involved were uncertain whether or not reinforcing bars would be included in the new system of production quotas which would apply after 30 June 1981. It should not be forgotten that reinforcing bars were only finally included on 3 July 1981 by general Decision No 1832/81 including them and merchant bars in the new system of production quotas (Official Journal L 184, p. 1), which amended general Decision No 1831/81 which had already come into force on 1 July.

io These circumstances are not however sufficient to exonerate the applicant from the criticisms made of it by the Commission. Account must be taken of the fact that the Libyan order of April 1981 was for 30 000 tonnes, a quantity considerably above the quarterly production quota normally allocated to the applicant. The prudence required of every undertaking operating in a regulated market like that in steel products in 1981 should· have caused the applicant to take the necessary precautions and to apply at once for the necessary adjustment of the quotas allocated to it, so as to be able to contest any unjustified refusal. The mere fact that the Commission, in its earlier correspondence with the applicant, had referred Ín general terms to the "interest of the Community steel industry" in maintaining the patterns of exports to non-member countries, is not such as to discharge the applicant from that obligation.

is Under Article 69 (2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been asked for in the successful party's pleading. The applicant, having failed in its submissions, must be ordered to pay the costs.

On those grounds,

THE COURT (First Chamber)

hereby:

1. Dismisses the application;

2. Orders the applicant to pay the costs.