C-393/92

Energiebedrijf IJsselmij NV

on the interpretation of Articles 37, 85, 86, 90 and 177 of the EEC Treaty,

THE COURT,

composed of: O. Due, President, G. F. Mancini, J. C. Moitinho de Almeida and M. Diez de Velasco (Presidents of Chambers), C. N. Kakouris, R. Joliét, F. A. Schock­ weiler (Rapporteur), G. C. Rodríguez Iglesias, M. Zuleeg, P. J. G. Kapteyn and J. L. Murray, Judges,

* Language of the case: Dutch.

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— the French Government, by P. Pouzoulet, Deputy Director in the Directorate for Legal Affairs of the Ministry of Foreign Affairs, acting as Agent,

— the Netherlands Government, by A. Bos, Legal Adviser in the Ministry of For­ eign Affairs, acting as Agent,

— the Commission of the European Communities, by B. J. Drijber, a member of its Legal Service, acting as Agent,

having regard to the Report for the Hearing,

after hearing the oral observations of the Municipality of Almelo and Others, Energiebedrijf IJsselmij NV, the Greek Government, the Netherlands Govern­ ment, represented by J. W. de Zwaan, Deputy Legal Adviser in the Ministry of Foreign Affairs, acting as Agent, and the Commission, at the hearing on 23 November 1993,

after hearing the Opinion of the Advocate General at the sitting on 8 Febru­ ary 1994,

3 Electric power is produced in the Netherlands by four undertakings holding shares in a jointly owned undertaking, NV Samenwerkende Elekriciteits- Produktiebedrijven (hereinafter 'SEP'), which is intended to serve as a vehicle for cooperation between the generators.

4 The distribution of electricity is organized at regional and local level. Within the territory granted to them, the regional distribution undertakings supply the local distribution undertakings owned by the municipalities and, in some cases, the end- users. The local distribution undertakings handle supplies to customers within the municipalities. The production and distribution undertakings are owned, directly or indirectly, by the provinces and municipalities.

5 By Royal Order of 1918 IJM was granted a non-exclusive concession to distribute electricity within the territory covered by that concession. IJM supplies electricity to local distributors, in particular the Municipality of Almelo and the other plain-

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tiffs in the main proceedings, and also makes direct supplies to consumers in rural areas.

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11 With effect from 1 January 1985, IJC charged the local distributors an equalization supplement, that is to say, a surcharge intended to offset the difference between the higher cost incurred by it in distributing electricity to consumers in rural areas and the lower cost incurred by the local distributors in distributing electricity to con­ sumers in urban areas.

12 In 1988 certain local distribution undertakings lodged with the Commission a complaint against IJC, relating to three matters:

— the import ban explicitly laid down in the 1971 General SEP Agreement and in the OVS;

— the exclusive purchasing obligation deriving from the agreements concluded with IJC;

exports of production outside the field of public supply, by distributors and pri­ vate industrial consumers, including autogenerators'.

15s The Commission observes that the ban on imports at the level of non-public dis­ tribution, that is to say, the ban imposed on consumers in their contracts with local distributors, cannot be justified under Article 90(2) of the Treaty.

16 Although the Commission did not express a view in the 1991 Decision on the ban on imports resulting from Article 2(2) of the general conditions, it notes that

'these provisions of the General Terms and Conditions together with Article 21 form a whole, operating both among generators and ultimately between them and their industrial consumers'.

17 The Commission refrained from passing judgment on the question whether Art­ icle 90(2) of the Treaty applies to the ban on imports imposed by Article 21 of the OVS on the public supply of electricity; according to the Commission, the ban on imports by generators and distributors otherwise than through SEP in the context of public supply is now to be found in Article 34 of the 1989 Law, and to take a view on the matter would be to anticipate the question whether that Law is com­ patible with the Treaty. Nor did the Commission make any finding as to the law­ fulness of the equalization supplement.

18The action brought by the complainants against the 1991 Decision was dismissed by judgment of the Court of First Instance in Case T-16/91 Rendo and Others v Commission [1992] ECR 11-2417. The appeal lodged by the complainants against that judgment is pending before the Court of Justice (Case C-19/93 P Rendo and Others v Commission).

2. How are Articles 37 and/or 85 and/or 86 and/or 90 of the EEC Treaty to be interpreted with reference to a ban on the import of electricity for public sup­ ply purposes contained in the general conditions of a regional electricity dis­ tributor from 1985 to 1988 inclusive, possibly in conjunction with an import ban contained in an agreement made between the electricity generation under­ takings in the Member State concerned?'

The first question

21 In order to answer the first question, it should be noted that, as the Court held in its judgment in Case 61/65 Vaassen-Göbbels [1966] ECR 377, the concept of a

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court or tribunal within the meaning of Article 177 of the Treaty necessarily implies that such a forum should satisfy a number of criteria; it must be established by law, have a permanent existence, exercise binding jurisdiction, be bound by rules of adversary procedure and apply the rule of law. The Court has extended those criteria, pointing out in particular the need for the court or tribunal in ques­ tion to be independent (judgments in Case 14/86 Pretore di Salò [1987] ECR 2545, paragraph 7, Case 338/85 Pardini [1988] ECR 2041, paragraph 9 and Case C-24/92 Corbiau [1993] ECR 1-1278).

25 By its second question the national court is essentially asking whether Articles 37 and/or 85 and/or 86 and/or 90 of the Treaty preclude the application, by a regional electricity distributor, of an exclusive purchasing clause contained in the general conditions of sale which prohibits a local distributor from importing electricity for public supply purposes.

26 In order to answer that question, it is necessary to consider whether a ban on imports imposed on a local electricity distributor under a contract concluded with the regional distributor is contrary to Articles 37, 85 or 86 of the Treaty, and the extent to which derogations from the prohibitions laid down by those provisions may be made under Article 90(2) of the Treaty.

Article 37 of the Treaty

27 First of all, as far as the scope of Article 37 is concerned, it is to be recalled that it follows both from the position which that article occupies in the chapter on the elimination of quantitative restrictions and from the use of the words 'imports' and 'exports' in the second indent of paragraph (1) and the word 'products' in para­ graphs (3) and (4) that it covers trade in goods (see the judgments in Case 155/73 Sacchi [1974] ECR 409, paragraph 10, and Joined Cases C-46/90 and C-93/91 Lagauche and Evrard [1993] ECR 1-5267, paragraph 33).

28 In Community law, and indeed in the national laws of the Member States, it is accepted that electricity constitutes a good within the meaning of Article 30 of the Treaty. Electricity is thus regarded as a good under the Community's tariff nomen­ clature (code CN 27.16). Furthermore, in its judgment in Case 6/64 Costa v ENEL [1964] ECR 1141 the Court accepted that electricity may fall within the scope of Article 37 of the Treaty.

32 It follows that the situation with which the main proceedings are concerned is not covered by Article 37 of the Treaty.

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Articles 85, 86 and 90(2) of the Treaty

33 The Court has consistently held that the conduct of an undertaking referred to in Article 90(1) of the Treaty must be assessed with regard to the provisions of Art­ icles 85, 86 and 90(2) (see the judgment in Case C-260/89 ERT [1991] ECR I-2925).

Article 85 of the Treaty

38 In that regard, it appears from the documents before the Court that the general conditions governing the relations between the parties to the main proceedings, which contain the exclusivity clause, follow the model General Terms and Condi­ tions for the supply of electricity drawn up by the Association of Operators of Electricity Undertakings in the Netherlands.

39 Those contractual relationships have the cumulative effect of compartmentalizing the national market, inasmuch as they have the effect of prohibiting local distrib­ utors established in the Netherlands from obtaining supplies of electricity from distributors or producers in other Member States.

Article 86 of the Treaty

40 Article 86 of the Treaty prohibits abusive practices resulting from the exploitation by one or more undertakings of a dominant position on the common market or in a substantial part of it in so far as those practices may affect trade between Member States (judgment in Bodson, cited above, paragraph 22).

41 Although the conclusion cannot automatically be drawn that a dominant position is held in a substantial part of the common market by an undertaking which, like IJM, has a non-exclusive concession covering only part of the territory of a Mem­ ber State, a different assessment must apply where that undertaking belongs to a group of undertakings which collectively occupy a dominant position.

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46 Article 90(2) of the Treaty provides that undertakings entrusted with the operation of services of general economic interest may be exempted from the application of the competition rules contained in the Treaty in so far as it is necessary to impose restrictions on competition, or even to exclude all competition, from other econ­ omic operators in order to ensure the performance of the particular tasks assigned to them (see the judgment in Case C-320/91 Corbeau [1993] ECR 1-2533, para­ graph 14).

47 As regards the question whether an undertaking such as IJM has been entrusted with the operation of services of general interest, it should be borne in mind that it

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has been given the task, through the grant of a non-exclusive concession governed by public law, of ensuring the supply of electricity in part of the national territory.

48 Such an undertaking must ensure that throughout the territory in respect of which the concession is granted, all consumers, whether local distributors or end-users, receive uninterrupted supplies of electricity in sufficient quantities to meet demand at any given time, at uniform tariff rates and on terms which may not vary save in accordance with objective criteria applicable to all customers.

JUDGMENT OF 27. 4. 1994 — CASE C-393/92

dominant position in a substantial part of the common market, of an exclusive purchasing clause contained in the general conditions of sale which prohibits a local distributor from importing electricity for public supply purposes and which, in view of its economic and legal context, affects trade between Member States;

(c) Article 90(2) of the Treaty is to be interpreted as meaning that the application by a regional electricity distributor of such an exclusive purchasing clause is not caught by the prohibitions contained in Articles 85 and 86 of the Treaty in so far as that restriction of competition is necessary in order to enable that undertaking to perform its task of general interest. It is for the national court to consider whether that condition is fulfilled.

Costs

52 The costs incurred by the Greek, French and Netherlands Governments and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

On those grounds,

2) (a) Article 85 of the Treaty precludes the application, by a regional electric­ ity distributor, of an exclusive purchasing clause contained in the gen­ eral conditions of sale which prohibits a local distributor from importing electricity for public supply purposes and which, having regard to its economic and legal context, affects trade between Member States;

(b) Article 86 of the Treaty precludes the application, by a regional electric­ ity distributor where it belongs to a group of undertakings occupying a collective dominant position in a substantial part of the common mar­ ket, of an exclusive purchasing clause contained in the general condi­ tions of sale which prohibits a local distributor from importing electric­ ity for public supply purposes and which, in view of its economic and legal context, affects trade between Member States;

(c) Article 90(2) of the Treaty is to be interpreted as meaning that the appli­ cation by a regional electricity distributor of such an exclusive purchas­ ing clause is not caught by the prohibitions contained in Articles 85 and 86 of the Treaty in so far as that restriction of competition is neces­ sary in order to enable that undertaking to perform its task of general interest. It is for the national court to consider whether that condition is fulfilled.

Due Mancini Moitinlio de Almeida

Diez de Velasco Kakouris Joliét

Schockweiler Rodríguez Iglesias Zuleeg