C-104/95

OPINION OF MR COSMAS — CASE C-104/95

OPINION OF ADVOCATE GENERAL COSMAS delivered on 4 July 1996 *

1. In this case the Court is called upon to The applicant claims that from 1988 onwards interpret, for the first time, in reply to ques­ the defendant sold its products to customers tions referred to it for a preliminary ruling in the above area, concealing the relevant by the Polimeles Protodikio, Athens, contracts from him in order to deprive him Article 7(2) of Council Directive of the commission to which he was entitled. 86/653/EEC of 18 December 1986 on the The plaintiff further alleges that the coordination of the laws of the Member defendant terminated the agreement binding States relating to self-employed commercial them without complying with the agreed 1 agents. two-month period of notice. Accordingly the plaintiff claims that the defendant should pay him certain amounts of commission and damages for failing to comply with the two-month period of notice to terminate the agreement.

I — The main proceedings

4. The Polimeles Protodikio, Athens, con­ is a company whose seat is located in a sidered that the case before it gave rise to a different place from that in which its question of interpretation of Community business and trading activities are car­ law, in particular of Article 7(2) of Directive ried on, does the word "belonging" 86/653/EEC ('the Directive') and accord­ refer to the company's seat or to the ingly decided to stay proceedings and refer, place in which its commercial activity is pursuant to Article 177 of the EC Treaty, actually carried on and/or its plant or certain questions to the Court of Justice for a other establishments are located, where preliminary ruling. the transaction in respect of which com­ mission is sought was to supply that plant or those establishments and the relevant transaction in respect of which the agent claims commission was entered into in that place within the II — Questions referred to the Court agent's geographical area of activity?' 3

5. The Polimeles Protodikio, Athens, asks III — Legal background the Court to give a ruling on the following questions: 2

6. Article 7(1) of the Directive provides as follows: '1 . Where a commercial agent is respon­ sible for a specific geographical area, is he entitled to commission on transac­ tions entered into without his involve­ ment at any stage and irrespective of 'A commercial agent shall be entitled to whether he himself had found the cus­ commission on commercial transactions con­ tomers in question, or is he so entitled cluded during the period covered by the only on transactions concluded in his agency contract: area of activity as a result of his inter­ vention and with customers which he himself has found; and

'A commercial agent shall also be entitled to commission on transactions concluded dur­ ing the period covered by the agency con­ tract:

'A commercial agent shall be entitled to commission on commercial transactions con­ cluded during the period covered by the agency contract where he is entrusted with a — either where he is entrusted with a spe­ specific geographical area and the transaction cific geographical area or group of cus­ was entered into with a customer belonging 5 tomers, to that area.'

9. At the hearing, the defendant in the main action, referring to its arguments in the writ­ ten procedure, contended that the questions referred for a preliminary ruling should not be answered as to substance. That was because, in its view, it was not objectively necessary in order to resolve the dispute in the main proceedings, in view of the fact that the plaintiff in the main action had never had 11. According to the case-law of the Court a contractual relationship with the company of Justice it is for the national court before Saint Ritsis, which had merged with Karton­ which the proceedings are pending to deter­ pak, and, for that reason, he was not in any mine, having regard to the special features of event entitled to commission for contracts the case, both the need for a preliminary rul­ concluded with customers of the former ing to enable it to give judgment and the rel­ company. evance of the questions which it refers to the 6 Court, and also to decide at which stage of 7 the proceedings to refer such questions. Taking that case-law into account, and inas­ much as the questions referred to the Court by the Polimeles Protodikio, Athens, cannot be regarded as manifestly lacking any signifi­ cance for the resolution of the case before it, 10. The defendant in fact contended before the contentions of the defendant in the main the national court (sec point 3 above) that action to the effect that the questions are not the action against it should be dismissed, objectively necessary for the resolution of inter alia since the customers to whom the that dispute, must in any case be rejected, a plaintiff referred were former customers of fortiori since the defendant's contention is Saint Ritsis, with which the plaintiff did not linked to assessment of the facts, the ascer­ have a contractual relationship. Nevertheless, tainment of which (where, as in the present the national court considered [probably case, there is a material disagreement because the plaintiff had claimed before it 8 between the parties ) is, under the system that 'he was entitled to commission (...) regardless whether he had himself found the customers or whether they were customers of Saint Ritsis and (...) he had not been 6 - Sec. (or example. Case 247/86 Alsatel [1988] ECR 5987, paragraph 8, and Casc C 134/94 F.sso Española [19951 involved at all in the sales to them'] that, ECR I 4223, paragraph 9. before deciding on the question whether the 7 — Sec Joined Cases 36/80 and 71/80 Irish Creamery Milk Sup- pliers Association and Others [1981] ECR 735. paragraph 5 el defendant's arguments were well founded, it seq., and Cases 338/85 Partimi [1988] ECR 2041, para should refer questions for a preliminary rul­ graph 8, and C 348/89 Meantime [1991] ECR 1 3277, para graph 48. ing to the Court of Justice, in order to have 8 — from the order for reference, it appears that the plaintiff the exact meaning of Article 7(2) of the rejects the defendant's arguments to the effect that the cus tomers to whom he refers in his pleadings were former cus­ directive clarified, with the reservation, as tomers of Saint Ritsis.

established by Article 177 of the Treaty, the national court or enlarge the scope of the 9 n solely for the national court. question referred. In this case, there is no indication in the decision to refer a question to the court which would permit the con­ struction of the first question proposed by the defendant in the main action. Accord­ ingly, to accept that interpretation would in fact amount to enlarging the scope of that 12. The defendant in the main action main­ question which, primarily for the above rea­ tained, moreover, at the hearing before the son, cannot be permitted. Court, that if the questions referred for a preliminary ruling are held admissible, the first question requires to be reformulated. It argues that it should be accepted, in inter­ preting the order for reference as a whole, that by its first question the national court is asking whether, within the meaning of the second indent of Article 7(2) of the Direc­ tive, and in the light of Articles 17 and 19 of 14. Before examining the merits, the follow­ the Third Directive concerning mergers of ing points should be made: Article 11 of public limited liability companies, 10 a com­ Presidential Decree 219/91 contains transi­ mercial agent is entitled to commission for tional provisions corresponding to the tran­ contracts concluded with customers of a sitional arrangements provided for in third company which has taken over the Article 22(1) of the Directive. In accordance company with which he had contracted. with Article 11(1) of Presidential Decree 219/91, it is to apply to contracts concluded after its entry into force. Moreover, Article 11(2) provides as follows: 'As regards the rights and duties of the parties under contracts concluded prior to the entry into force of this Presidential Decree, the provi­ sions of that Decree are to apply from 1 13. On that point it need merely be pointed January 1994.' Consequently, in view of the out that, according to settled case-law, by fact that Presidential Decree 219/91 was virtue of the division of jurisdiction provided published in the Official Gazette of the Hel­ for in Article 177 in preliminary-ruling pro­ lenic Republic on 30 May 1991, the right laid ceedings, it is for the national court alone to down in that Decree applied to new con­ determine the subject-matter of the ques­ tracts, that is to say those concluded after tions which it wishes to refer to the Court; that date and thenceforth. Conversely, the the Court cannot, therefore, at the request of Presidential Decree did not apply to previ­ a party to the main proceedings, examine a ous contracts, that is to say to those con­ question which has not been referred to it by cluded prior to the above date, in respect of

15. As the pleadings show, the commercial agency contract in question was concluded prior to the entry into force of Presidential Decree 219/91, on 10 February 1981. Thus it 17. In the order for reference, the national is not covered by the new régime laid down court expresses the view that 'even if the in the Decree, unless it was still in force on transaction was concluded without the the determinant date of 1 January 1994, that involvement of the representative and with a is to say on the date on which the Decree customer which he did not find, as long as began to apply to previous contracts as well. that transaction was concluded in his geo­ From the order for reference it appears, graphical area ... the agent is entitled to com­ moreover, that the defendant took steps to mission.' Apart from the plaintiff, the Com­ terminate the agreement at an unspecified mission and the Governments of the French date. Accordingly, if the agreement in ques­ Republic, the Federal Republic of Germany tion was terminated prior to 1 January 1994, and the Hellenic Republic, which submitted it falls outside the scope of Presidential written observations, all support that view. Decree 219/91, which would probably auto­ matically deprive the questions referred for a preliminary ruling of any effect on the out­ come of the main proceedings. Since, how­ ever, the national court considers the dispute before it to be covered by the provisions of Presidential Decree 219/91, its questions must be examined as to substance. 18. The formulation and structure of Article 7(1) and (2) also lend support to that view. In the cases of Article 7(1)(a) and (b) of the directive, the legislature proceeds on the basis that, for a commercial agent's claim to commission to arise, the contract should be the consequence of his personal involvement. V — Question 1 Consequently a causal connection between the conclusion of the contract in question and the intermediary role of the representa­ tive is required. Conversely, the case dealt with in Article 7(2) does not presuppose the existence of such a relationship. A commer­ 16. By this question the national court asks cial agent with an assigned area has a claim the Court to clarify whether a commercial to commission for every transaction con­ agent who is contractually responsible for or cluded with a customer belonging to that

19. That interpretation is consistent with the formulation of Article 7(2), according to which the agent 'shall also be entitled to 22. In the view of the national court, the commission' in the cases provided for in that commercial agent is entitled to commission provision. That formulation indicates that on the conclusion of the contract with a cus­ what is laid down in Article 7(2) goes tomer whom he did not find, 'as long as that beyond that provided for in Article 7(1) and transaction was concluded in his geographi­ accordingly conclusion of a contract follow­ cal area and irrespective of whether the seat ing the involvement of the agent does not, or any other establishment in which the cus­ under the abovementioned Article 7(2), con­ tomer carries on his commercial activity is stitute the precondition for entitlement to located in that area.' The defendant in the commission. Moreover, if that condition had main proceedings contends that it is the to be met in the cases provided for in place central to the decision to conclude the Article 7(2), then the existence of that para­ contract and where all the necessary docu­ graph would be unnecessary. ments are executed that is of crucial signifi­ cance. According to the Commission, the place where the commercial activities of the customer are actually exercised must be taken into account, unless the relevant com­ mercial agency contract shows a different intention on the part of the contracting par­ ties. In the view of the Greek Government, it 20. Accordingly, the following reply should is for the national court to determine, in the be given to the first question: Article 7(2) of light of the actual circumstances of each con­ the directive should be interpreted to the tract, whether a particular customer belongs effect that, where the commercial agent is to the geographical area for which the com­ responsible for a specific geographical area, mercial agent is responsible. The German he is entitled to commission even on transac­ Government observes that on this pomt the tions concluded without his involvement. Community legislature adopted the same

23. I consider that the term 'customer belonging to a geographical area' must be 25. Where legal persons arc involved and, in defined on the basis of the commercial particular, companies, the criterion to which agency contract binding the parties. In view recourse should principally be had is their of the fact that commercial relations are seat. That criterion, however, should not be involved which arc governed as a rule by the regarded as absolute, since otherwise prob­ principle of the parties' freedom to decide lems would be created in cases where, for the terms of the contract, the definition on a instance, there is more than one place of geographical or other basis of the circle of business, branch, or so forth. The present customers falling within the scope of the question referred to the Court demonstrates commercial agent's activities as intermediary those problems particularly vividly. On the is, first and foremost, a question for the par- actual facts before the national court, the scat 1 tics. 3Accordingly in each case the intention of one of those customers was in the Attiki of the contracting parties must be ascer­ area, whereas its plant was in another area, specifically in the area where the plaintiff carried out his activities as a commercial agent. Application of the criterion of the scat 12 — The second subparagraph of Paragraph 87 of the 11GB stales as follows: 'Isl dem Handelsvertreter ein bestimmter in such a case would lead to recognition of a Bezirk oder ein bestimmter Kundenkreis zugewiesen so hat claim to commission solely in favour of an er Anspruch auf Provision auch fur Geschafte, die ohne seine Mitwirkung mit Personen seines Bezirkes oder seines Kundenkreises wahrend des Vcrtragverhaltnisses abge schlossen sind.' 13 — The rules introduced by the Directive (and, accordingly, the provisions by which they are transposed into national law) 14 — See A. Liakopoulos: Γενικό Εμπορικό Αικαιο (General are, in principle, rules of dispositive law (jus dispositivum); Commercial Law) (2nd edition), p. 120; D. Bruggemann: for an exception, see the provisions of Article 5 of the Staub, Grosskommentar HGB (4th edition). Paragraph 87 Directive). HGB , No 38 et seq.

agent operating where the seat of the com­ of the German courts when interpreting the pany was situated. second subparagraph of Paragraph 87 of the HGB which, as mentioned above, contains a provision analogous to Article 7(2) of the 16 Directive. On the basis of that interpreta­ tion, a commercial agent is entitled to com­ mission on contracts drawn up by the principal following an order from an estab­ lishment of a company operating as an inde­ pendent unit within his area even though the 26. That is a particularly stringent solution, contract was concluded outside his assigned which leads to an unfair result in cases where area. Conversely, a commercial agent cannot the order or initiative for the order came claim commission for a contract drawn up from a branch or plant in the area of another by the principal with a customer who does agent. In such a case, the order and the con­ not belong to that area in the sense set out clusion of the ensuing contract can well be above, even though the contract was con­ ascribed to the overall activities carried out 17 cluded within that area. Thus the addi­ by the latter agent as regards attending to the tional criterion which, from the formulation interests of his principal in the area assigned. of the second question referred to the Court, Although independent of any actual activity the national court would appear to regard as as an intemediary on the part of the agent, acceptable, that is to say the place where the his claim to commission for contracts con­ contract was concluded, does not affect the cluded with customers belonging to the system of the Directive. region assigned to him essentially constitutes remuneration (indirect) not solely for each particular contract but for the overall activi­ ties of the agent in the geographical area for 15 which he is responsible. Those consider­ ations lead me to the conclusion that instead of the standard criterion of the seat, the essential criterion to be preferred is who placed the order. Where the branch or plant functions as an independent establishment and is allowed by the central administration of the legal person to place orders, it should be regarded as a customer belonging to the 27. Accordingly, the following reply should region assigned to the agent within the be given to the second question: The term meaning of the provision to be interpreted. 'customer belonging' at the end of the first If, conversely, the plant or branch located in subparagraph of Article 7(2) of Council the area in question is not free to act inde­ Directive 86/653/EEC should be interpreted pendently, then the company itself whose as referring, whenever a customer is a legal seat is outside the assigned area should be person with several establishments, to the regarded as the customer. That solution has establishment which placed the order, unless been adopted, as the German Government the agreement provides otherwise. has stated in its observations, in the case-law

(2) The term 'customer belonging' at the end of the first subparagraph of Article 7(2) of Council Directive 86/653/EEC should be interpreted as refer­ ring, whenever a customer is a legal person with several establishments, to the establishment which placed the order, unless the agreement provides other­ wise.

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