C-101/87

BORK INTERNATIONAL v FORENINGEN AF ARBEJDSLEDERE I DANMARK

OPINION OF MR ADVOCATE GENERAL DARMON delivered on 4 May 1988 *

Mr President, December 1981 between OTF and Junckers Members of the Court, Industrier A/S ('JI') which resulted on 30 December 1981 in a written agreement for the purchase by JI of the beechwood veneer factory and the boiler unit belonging to it. 1. Once again the Court is being asked to Under the agreement, OTF transferred to JI deal with a question concerning the inter­ the land, buildings, machinery and spare pretation of Council Directive 77/187/EEC parts with effect from 4 January 1982. On of 14 February 1977 on the approximation that date, JI resumed the operation of the of the laws of the Member States relating to factory with staff composed exclusively of a the safeguarding of employees' rights in the number of PBľs employees who had been event of transfers of undertakings, busi­ taken on again. Subsequently, on 8 January nesses or parts of businesses. 1 The novelty 1982, an agreement was concluded between of this case is limited, as we shall see, to the PBI and JI for the purchase by the latter of facts of the case themselves and does not the stock, spare parts, tools, auxiliary extend to the problems submitted to the material and other equipment left on the Court, which, in my view, have already premises. On 9 July 1982, PBI was wound been decided by the Court in its most recent up. rulings.

OPINION OF MR DARMON — CASE 101/87

stages. PBI terminated the lease with effect consideration of the possible consequences from 22 December 1981 and it was the of the absence of a legal connection owner of the factory, OTF , which sold the between the lessee of an undertaking and land, buildings, machinery and spare parts the person who, upon termination of the to JI on 30 December 1981. JI contended lease, purchases the undertaking from its before the national court, and then before owner. A proper answer calls for the Court of Justice, that there could not be consideration of the question whether the a transfer within the meaning of the directive is applicable after the lapse, directive where the original employer had between the cessation of business by one taken no part in the transactions which firm and its resumption by another firm, of resulted in an undertaking being brought a period of time in which the factory had into operation by a subsequent employer. ceased to operate. In its observations, JI The application of the directive presupposed contended that there could not be a transfer that the previous employer was a party to within the meaning of the directive when an the agreement concerning the transfer of the undertaking has ceased to operate, and in undertaking. this case it was considered to have done so definitively.

According to the Court's recent judgment of 17 December 'the fact that . . . the transfer is effected in 1987 in Case 287/86, Ny Mølle Kro, that two stages, in that the undertaking is first provision re-transferred from the original lessee to the owner and the latter then transfers it to the new lesseee, does not prevent the directive from applying, provided that the economic 'envisages the case in which the business unit in question retains its identity . . . '. 2 retains its identity inasmuch as it is trans ferred as a going concern, which may be 324// 86 Foreningen af Arbejdsledere i Danmark v 2 — Case 324 Daddy's Dance Hall [1988] ECR 739, paragraph 10 of the indicated in particular by the fact that its decision. operation is actually continued or resumed

Furthermore,

12. In my view, the question whether an 'all those circumstances are merely single undertaking has ceased to operate illustrates factors in the overall assessment which must that need to observe the division of be made and cannot therefore be considered functions between the Court of Justice and 4 in isolation'. the national court. In its judgment in Ny Mølle Kro, the Court referred, among the circumstances to be assessed by the national 10. One aspect of the Court's case-law, court, to the fact that which in my view is fundamental for the purposes of the answer to be given, is the paragraph (worded identically in the Spijkers and Ny Mølle Kro judgments) in which, after laying down the conditions for 'the undertaking in question was tempo­ the transfer and listing some of the criteria rarily closed at the time of the transfer and for assessing whether those conditions are therefore had no employees' satisfied, the Court adds that: and pointed out that 287// 86 Ny Mølle Kro [ 1987 3 — Case 287 1987]] ECR 5465 5465,, at p. 5484 5484,, decision.. paragraph 18 of the decision 24// 85 Spijkers v Benedik [ 1986 4 — Case 24 1986]] ECR 1119 1119,, paragraph 5 24// 85 —Case 24 85,, cited above above,, paragraph 14 of the decision decision,, and 287// 86 Case 287 86,, cited above above,, paragraph 21 of the decision decision.. decision.. 13 of the decision

OPINION OF MR DARMON — CASE 101/87

'the temporary closure of an undertaking 'Article 1 (1) of [the directive] does not and the resulting absence of staff at the time apply to the transfer of an under­ of the transfer do not of themselves taking . . . where the transferor has been preclude the possibility that there has been a adjudged insolvent. . . '. 6 transfer of an undertaking . . . ' .

13. In my view, therefore, it is not for the 'Ultimately, the only cases to which Article Court to examine in successive references 1 [of the directive] is always and indis- for a preliminary ruling the different putedly inapplicable are those involving an possible varieties of a temporary cessation of undertaking which is bankrupt or a business in order to distinguish those which company which is in liquidation'. preclude the application of the directive from those which entail its application. That is a matter for the national court in each individual case. It is only where there are a number of sufficiently clear factors which 15. Can the situation which gave rise to make it possible to establish that an under­ these proceedings before the Court be iden­ taking is no longer a going concern that the tified as one of the cases which permit the Court may draw the consequences of the Court to conclude decisively that the cessation of business in a particular case. directive is inapplicable? PBI was in fact wound up, but more than seven months after the transfer in question. Therefore that circumstance is not relevant. Moreover, PBI's unilateral intention expressed in 14. In my view, it follows from an exam­ December 1981 to cease business cannot be ination of the Court's previous decisions equated with the liquidation of an under­ that the cases in which it has, in a particular taking in the procedural sense, that is to instance, come to the conclusion that the say, a winding-up by the court. directive is inapplicable correspond to certainly legally well-defined situations. Thus , in its judgments of 7 February 1985 in Case 135/83 Abels, 7and in Case 186/83 16. Is it possible, however, leaving aside the 8 Botzen, the Court held that strict cases of insolvency or liquidation, to identify in the situation which led the 6 — Case 287/86, cited above, paragraph 19 of the decision. 7 — Case 135/83 Abels [1985] ECR 469. 9 — Joined Cases 144 and 145/87 Berg and Busschers v Besselsen 8 — Case 186/83 Bolzen [1985] ECR 519. [1988] ECR 2559.

Højesteret to refer the matter to the Court of those holidays, is a reason for ascer­ any criteria which would in the Court's view taining whether Article 4 (1) of the also be incompatible with the existence of a directive, which prohibits dismissal from transfer within the meaning of Article 1 (1) being based on the transfer itself, has been of the directive? JI has argued before the complied with. Since OTF's aim, upon Court that in December 1981 PBI regarded termination of the lease to PBI, was to sell the beechwood veneer factory's cessation of all the movable and immovable property as operations as definitive, no resumption of soon as possible, thereby enabling a third operations being envisaged at the time, and party to resume the operation of the considered that the dismissal of the factory's factory, can the owner's refusal to continue staff amounted to instant dismissal which to operate the factory on his own account terminated the employment relationship at after the termination of the lease be once. regarded as sufficient to consider the dismissal by PBI of its employees as an instant dismissal terminating the 17. Those factors do not by any means employment relationship once and for all? strike me as being sufficient to justify at this Since the continuation of operations, as a stage an unequivocal answer to the effect result of the sale of the factory, was that the directive is not applicable. They envisaged in principle upon termination of cannot be considered separately from other the lease, even though a sale had not yet circumstances, such as the non-expiry of the been agreed, it is possible to take the view period of notice, the shortness of the period that Article 4 (1) of the directive prohibited for which the factory ceased to operate, the the dismissals from being regarded as fact that the latter period coincided with the instant dismissals which brought the Christmas and New Year holidays which employment relationship to an end. involved, by definition, as the national court has expressly pointed out, a very appreciable slackening in production, and the similarity 19. In my view, therefore, there are a between PBI's operations and those number of issues which must be discussed subsequently carried out by JI exclusively and resolved. This means that the situation with staff previously employed by PBI. which has given rise to these proceedings has not disclosed any factor of such a kind 18. Furthermore, the brevity of the as to enable the Court to state decisively cessation of operations and the swiftness that the directive is inapplicable and thus to with which they were resumed after the relieve the national court of the need to Christmas and New Year holidays, by a make an assessment of the facts as a whole, beechwood veneer factory such as that as required by the Court in its recent which purportedly closed down on the eve judgments in Spijkers and Ny Mølle Kro.