T-152/95

Communities,, represented by Gérard Berscheid, of Commission of the European Communities its Legal Service, acting as Agent, with an address for service in Luxembourg at the office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre, Kirchberg,

defendant,

APPLICATION for an order requiring the Commission to pay damages under Article 178 and the second paragraph of Article 215 of the EC Treaty as compen­ sation for the damage resulting from certain action taken by it in managing the common organization of the market in raw tobacco in the period 1990 to 1991,

case:: French * Language of the case French..

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Legislative background

1 On 21 April 1970 the Council adopted Regulation (EEC) No 727/70 on the com­ mon organization of the market in raw tobacco (OJ, English Special Edition 1970 (I), p. 206). The principal mechanisms of that common market organization (here­ inafter 'CMO' ) include the obligation of the intervention agencies of the Member States to purchase at the intervention price leaf tobacco harvested in the Commu­ nity and not disposed of through normal commercial channels. The tobacco so purchased is to be disposed of in such a way as to avoid any disturbance of the market and to ensure equal access to goods and equal treatment of purchasers (sec­ ond subparagraph of Article 7(2) of Regulation No 727/70).

2 Article 3 of Regulation (EEC) No 327/71 of the Council of 15 February 1971 lay­ ing down certain general rules relating to contracts for first processing and market

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preparation, to storage contracts and to disposal of tobacco held by intervention agencies (OJ, English Special Edition 1971 (I), p. 78) provides that the tobacco is to be disposed of on price terms determined case by case, on the basis of, inter alia, market trends and demand.

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5 Originally, Article 5(1) provided:

'Every tenderer shall provide the intervention agency concerned with security in an amount of 0.28 unit of account per kilogramme of raw tobacco.'

6 The amount of the security was raised to ECU 0.339 per kilogramme by Commis­ sion Regulation (EEC) No 3263/85 of 21 November 1985 amending Regulation No 3389/73 (OJ 1985 L 311, p. 22). By way of derogation from Article 5(1) of Regulation No 3389/73, it was raised to ECU 0.7 per kilogramme of baled tobacco by Commission Regulation (EEC) No 3040/91 of 15 October 1991 amending Regulation (EEC) No 2436/91 opening an invitation to tender for the sale of baled tobacco held by the German, Greek and Italian intervention agencies (OJ 1991 L 288, p . 18).

Facts

7 The applicant is a Greek company whose main business is processing and dealing in tobacco in Greece and elsewhere. At the material time, it had a tobacco process­ ing and storage centre and an additional storage unit. Depending on its needs, it also rented various small factories and offices. It worked with intermediaries and other agents in Greece and abroad.

9 The first tendering procedure at issue (hereinafter 'the first tendering procedure') was organized by Commission Regulation (EEC) No 899/90 of 5 April 1990 which opened an invitation to tender for the sale for export of baled tobacco held by the Greek intervention agency (OJ 1990 L 93, p. 7) and involved four lots of baled raw tobacco from the 1986 and the 1987 harvests, divided by varieties and totalling 5 271 428 kg. The deadline fixed for the Commission decision on the award of contract was 14 June 1990. The first lot comprised 1 805 903 kg of tobacco and was made up of the varieties Mavra, Kaba Koulak Classic and Elas- sona, Kaba Koulak Non-Classic, Katerini, Burlay EL and Basmas. The second lot comprised 1 519 836 kg of tobacco and was composed of the same varieties, with the exception of Basmas. The third lot comprised 1 519 991 kg of tobacco, and was made up of the same varieties as the second lot. The fourth lot comprised 425 698 kg of tobacco and was made up of the Mavra and Basmas varieties only. The appli­ cant submitted a tender for the first and second lots (in the amounts of DR 76.11 and DR 63.11 per kilogramme respectively). However, on 14 June 1990 the Com­ mission decided not to accept any of the tenderers' bids on the ground that, in view of the prices offered, there was a risk that the market might be disturbed.

10 The second tendering procedure at issue (hereinafter 'the second tendering pro­ cedure') was organized by Commission Regulation (EEC) No 1560/90 of 8 June 1990 opening an invitation to tender for the sale for export of baled tobacco held by the Greek intervention agency (OJ 1990 L 148, p. 7). It related to the same four lots of baled raw tobacco. The deadline fixed for the Commission decision on the award of contract was 9 August 1990. The applicant submitted a bid for the first and fourth lots (in the amounts of DR 91.11 and DR 101.11 per kilogramme respectively). On 7 August 1990 the Commission accepted the bid from another tenderer for the second lot (of DR 102 per kilogramme), but rejected all bids for the first, third and fourth lots, on grounds of risk of disturbance of the market.

12 The fourth tendering procedure at issue (hereinafter 'the fourth tendering pro­ cedure') was organized by Commission Regulation (EEC) No 2436/91 of 7 August 1991 opening an invitation to tender for the sale of baled tobacco held by the German, Greek and Italian intervention agencies (OJ 1991 L 222, p . 23). The total quantity of 105 486 276 kg was made up of 11 lots, divided into four groups. Each group of lots could be put up for sale only when a contract for the previous group of lots had been awarded. The aim was to obtain bids for all the varieties of tobacco, and dealings were to commence with the least popular varieties on the market. Each lot comprised tobaccos of a given variety held by the various inter­ vention agencies of the various Member States concerned. The applicant took part in a number of sales in that series. Its bids, which were for a quantity lower than that fixed for the lots in question, were rejected as not fulfilling the tendering con­ ditions.

16 Upon hearing the Report of the Judge-Rapporteur, the Court of First Instance (Fourth Chamber) decided to open the oral procedure without any preparatory inquiries. However, it invited the parties to reply in writing to a number of ques­ tions and they did so.

17 The parties presented oral argument at the public hearing on 2 May 1997.

18 The applicant claims that the Court of First Instance should:

— find that the defendant has incurred liability under the second paragraph of Article 215 of the Treaty;

— order the defendant to redress the damage suffered by the applicant and pay it the sum of ECU 20 403 788;

— order the defendant to pay the costs.

20 It adds that it does not object to the appointment of an expert, to be paid for by the defendant, to assess the damage suffered by the applicant.

21 The Commission contends that the Court of First Instance should:

— declare the application for compensation inadmissible to the extent that it relates to facts and to acts of the defendant prior to 23 July 1990;

— declare inadmissible, for the purposes of these proceedings, the evidence and information concerning the proceedings of the Tobacco Management Commit­ tee;

— for the rest, dismiss the application as unfounded;

— order the applicant to pay the costs.

23 The applicant replies that this case is concerned with the subsequent circumstances in which its tenders were refused, and with the suspension of the procedure for the award of contracts and the conditions under which the tendering procedures were resumed. The various wrongful acts committed by the Commission all occurred after 23 July 1990. The damage had not crystallized at the time when its tender was rejected by the Commission on 14 June 1990.

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Findings of the Court

24 Pursuant to Article 43 of the EC Statute of the Court of Justice, which is appli­ cable to the Court of First Instance by virtue of Article 46 thereof, proceedings against the Community in matters arising from non-contractual liability are barred after five years from the occurrence of the event giving rise thereto.

25 In this case, the applicant has not sought to demonstrate in its pleadings how the rejection decision adopted on 14 June 1990 in connection with the first tendering procedure constituted unlawful conduct on the part of the Commission. All its submissions relate to other action taken by the Commission to which it objects.

30 It follows that the application must be declared inadmissible in so far as it relates to the first tendering procedure.

Substance

31 According to settled case-law of the Court of Justice and the Court of First Instance, the Communities' non-contractual liability is dependent on a series of conditions being satisfied as regards the unlawfulness of the acts alleged against the Community institution concerned, the fact of damage and the existence of a causal link between the wrongful act and the damage complained of (Joined Cases T-481/93 and T-484/93 Exporteurs in Levende Varkens and Others ν Commission [1995] ECR 11-2941, paragraph 80).

32 Before adjudicating on the question whether the Commission acted unlawfully, it is necessary to decide what treatment to accord the information concerning the proceedings of the Tobacco Management Committee, on which the applicant seeks to rely in this case.

The applicant's right to use certain information

Arguments of the parties

35 In this case, the only information contained in the proceedings of the Tobacco Management Committee which is relevant to the decision to be given in this case concerns the tenders submitted for the first, second and fourth lots in the second tendering procedure and the first lot in the third tendering procedure.

36 It should be noted, however, that the information referred to by the applicant regarding those tenders derives from other sources. The Commission itself con­ firmed in its reply to a written question from the Court that the applicant's tenders for the first lots in the second and third tendering procedures were the highest received for those lots. The amount of the tender accepted for the second lot in the second tendering procedure was disclosed by the Commission to the applicant in

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its decision of 7 August 1990. The fact that the applicant's tender for the fourth lot in the second tendering procedure was the highest received was confirmed by the Court of Auditors in its Special Report No 8/93 concerning the common organi­ zation of the market in raw tobacco (OJ 1994 C 65, p . 1, hereinafter 'the Special Report'). Finally, the second and fourth lots in the second tendering procedure are discussed in detail in points 4.53 to 4.55 of that report.

37 All that information is thus available regardless of any action by Greek bodies or authorities.

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41 First of all, contrary to the Commission's assertion, rejection of the tenders was not, in the applicant's view, justified by any risk of disturbance of the market. The means employed by the Commission were not suitable for the purpose of achiev­ ing the objective pursued and went beyond what was necessary to achieve it, con­ trary to the requirements of the principle of proportionality laid down by the case- law (Case C-256/90 Mignini [1992] ECR 1-2651, paragraph 16).

42 Rejection of the applicant's tenders was neither appropriate nor necessary and could not therefore be in conformity with the principle of proportionality.

46 Second, the Commission replies that the applicant refers without distinction to the tobacco varieties in general without taking account of their respective prices. There was thus no breach of the principle of equal treatment as a result of rejection of the applicant's tender for the fourth lot, accompanied by acceptance of the tender of a different tenderer for the second lot.

— Findings of the Court

47 The principle of proportionality has been recognized in settled case-law as one of the general principles of Community law. According to that principle, measures imposed by Community legislation must be appropriate for achieving the objective pursued and must not go beyond what is necessary to that end. Moreover, where there is a choice between several appropriate measures, recourse must be had to the least restrictive one and the disadvantages it entails must not be disproportion­ ate to the aims pursued (see Exporteurs in Levende Varkens and Others ν Com- mission, cited above, paragraph 119).

48 In this case, the applicant alleges that the Commission's decision to reject its ten­ ders for the first and fourth lots was pointless and inappropriate, but it does not specify the objective in relation to which that decision displayed those character­ istics, nor does it produce any evidence of those characteristics.

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53 As regards the principle of equal treatment, which is also alleged to have been infringed, it must be borne in mind that, according to settled case-law, it too is one of the fundamental principles of Community law and requires that comparable

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situations are not treated in a different manner unless the difference in treatment is objectively justified (see Case C-280/93 Germany v Council [1994] ECR 1-4973, paragraph 67).

54 In this case, the second and fourth lots, as compared by the applicant, did not contain the same tobacco varieties. As indicated in Regulation No 1560/90, the second lot comprised Mavra, Kaba Koulak Classic and Elassona, Kaba Koulak Non Classic, Katerini and Burley EL, whereas the fourth lot comprised Mavra and Basmas, the only tobacco variety common to both lots thus being Mavra. More­ over, the quantities concerned differed considerably: the second contained 1 519 836 kg of tobacco whereas the fourth contained only 425 698 kg.

55 Furthermore, on the basis of the information in its possession at the time, the Commission considered that the applicant's tender for the fourth lot was low, whereas that submitted for the second lot was acceptable, particularly when com­ pared with the price tendered for the third lot, the composition of which was almost identical to that of the second lot, as regards both the tobacco varieties included and their respective weights.

58 In short, having failed to show that the Commission treated two comparable situ­ ations differently, the applicant has no grounds for alleging any breach of the prin­ ciple of equal treatment in this case.

59 It follows from all the foregoing that the Commission's decision of 7 August 1990 rejecting the applicant's tenders for the first and fourth lots in the second tendering procedure is not unlawful in any way. The Community cannot therefore, as a result of that decision, have incurred non-contractual liability vis-à-vis the appli­ cant.

The third tendering procedure

— Arguments of the parties

60 Alleging breach of the principle of proportionality in relation to the third tender­ ing procedure, the applicant also claims that the Commission's rejection, on 16 November 1990, of the tenders submitted, again purportedly justified by risks

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64 Moreover, the applicant has produced no evidence to show that by deciding on 16 November 1990 to reject all the tenders in order not to disturb the market, the Commission failed to take account of market requirements, in spite of being required to do so by Article 3(c) of Regulation No 327/71. Unless proof to the contrary is produced, the fact that the Commission sought not to disturb the mar­ ket indicates that it took account of changes in market requirements, at least as it saw them at the time.

65 In any event, it must be borne in mind that the concern not to disturb the market is one of the objectives laid down in the applicable legislation (see paragraph 52 above) and that, pursuant to Article 6(1) of Regulation No 3389/73, the Commis­ sion was entitled not to accept the applicant's tender for the first lot, even if it was the highest, or any other tender received by it.

66 The plea as to breach of the principle of proportionality is thus unfounded.

67 Furthermore, it is of little importance that the decision of 16 November 1990 was taken outside the period of 15 days laid down by Article 6(1) of Regulation No 3389/73 for the adoption of a decision regarding the award of a contract. Since no sanction is imposed for failure to comply with that time-limit, it cannot be regarded as mandatory and failure to comply with it does not, according to the case-law, cause the Commission to incur liability unless it is the outcome of neg­ ligence on its part (Case C-55/91 Italy ν Commission [1993] ECR I-4813, para­ graph 69). However, in this case the applicant does not even allege that the Com­ mission was guilty of any such negligence, but merely refers to failure to observe that time-limit, and even then only in its reply to written questions put to it by the Court.

70 The Commission states that the period which elapsed between the third and fourth tendering procedures was attributable to several causes, in particular enormous price fluctuations as between the third tendering procedure and the earlier proce­ dures, discussions held by the Commission and the former USSR to consider the possibility of selling all the stocks to the latter, and the Commission's wish to dis­ pose of all the intervention stocks in order to give the new CMO a fresh start, hav­ ing stabilized the situation with regard to intervention.

— Findings of the Court

71 Omissions by the Community institutions can give rise to liability on the part of the Community only when the institutions have failed to comply with a legal obli­ gation to act imposed by a provision of Community law (see Case C-146/91 KYDEP ν Council and Commission [1994] ECR I-4199, paragraph 58).

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72 In this case, no applicable legislative provision required the Commission to award a contract within a specified period, nor has the applicant claimed that such was the case.

PETRIDES ν COMMISSION

quantities would also have given rise to storage costs incompatible with the size of such undertakings, including the applicant. The volume of tobacco put up for sale in the fourth tendering procedure represented one year's production in Greece and one-third of annual Community production.

76 The applicant complains that the regulation organizing the fourth tendering pro­ cedure set a period of 20 days between the date of publication of the notice of invitation to tender and the date for submission of tenders, instead of the normal period of 45 days laid down in Article 3 of Regulation No 3389/73, as amended by Commission Regulation (EEC) No 1344/75 of 27 May 1975 (OJ 1975 L 137, p . 20). That reduction made matters even worse for small and medium-sized undertakings.

77 The applicant rejects the Commission's suggestion that it could have joined other tenderers to submit a joint bid. It states that, in its Special Report, the Court of Auditors emphasized that group action by several operators laid the Commission open to the risk that cartels might be established.

78 Second, it claims that the manner in which the Commission organized the fourth tendering procedure also manifestly and blatantly infringed the principle of equal treatment, and more particularly Article 7(2) of Regulation No 727/70, because it de facto excluded small and medium-sized undertakings.

79 In the first place, the Commission considers that it did not in any way infringe the principle of proportionality since its approach was appropriate and necessary for sound management of the CMO . The composition of the lots reflected specific requirements given the state of the market at the time. The Commission questions the need to have facilities in the various Member States for the purposes of the submission of a single tender, as alleged by the applicant. Nevertheless, it is of

83 First, there was strong demand from the USSR for lower-quality tobacco products, which made it possible to make up homogeneous lots, whereas at an earlier stage the prevailing surplus on the world tobacco market made it necessary to sell lots made up of different varieties. The conduct of the operations necessitated the sub­ mission of tenders for all lots, and it was only possible to achieve that aim satis­ factorily by offering substantial lots for sale.

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84 Moreover, the imminence of the reform of the CMO for tobacco played an impor­ tant part, particularly the plan to abolish intervention, which entailed the disposal of stocks still held by the intervention agencies. A rapid clearance sale by tender was necessary owing to the favourable market conditions at the time. A homoge­ neous product was easier to evaluate and dispose of since it was suitable for spe­ cific types of purchasers and outlets.

85 Second, the Commission considers that, for the same reasons, it did not infringe the principle of equal treatment in organizing the fourth tendering procedure.

— Findings of the Court

90 Finally, there is no basis for the applicant's allegation that the reduction from 45 to 20 days of the period between the notice of invitation to tender and the date for submitting tenders was in any way illegal. The Commission was entitled to dero­ gate from Article 3 of Regulation No 3389/73, as amended, in the exercise of the wide discretion granted to it in relation to the Common Agricultural Policy (Joined Cases C-104/89 and C-37/90 Mulder and Others ν Council and Commis- sion [1992] ECR I-3061, paragraph 12). The applicant has neither alleged nor dem­ onstrated that the Commission committed a manifest error of assessment in taking the view that it was necessary to reduce the applicable period in order to sell lots expediously before the introduction of the new CMO . Moreover, the reduction of the time-limit affected all traders concerned, regardless of size. Furthermore, the applicant does not state to what extent the reduction might have favoured traders of a particular size as compared with others.

91 Since the Commission has shown that medium-sized undertakings participated in the tendering procedure, it is unnecessary to decide on the lawfulness of any joint tender by several traders for a single lot.

92 In any event, the measures chosen by the Commission for the fourth tendering procedure in order to dispose of the tobacco held by the intervention agencies

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were suitable for the purpose of attaining the aim pursued and did not go further than was necessary to achieve it (Vandemoortele ν Commission, cited above, para­ graph 34), since the stocks held by intervention agencies between 1991 and 1992 decreased appreciably and, for certain varieties at least, the prices obtained in the fourth tendering procedure were considerably higher than those tendered in the earlier procedures. In those circumstances, the Commission did not exceed the limits of its discretion in giving effect to the CMO for raw tobacco.

— Arguments of the parties

96 The applicant claims that by increasing the amount of the security, the Commis­ sion infringed the principle of proportionality: the increase was justified neither by market developments nor by the export refunds. The purpose of the security is to ensure that tenderers fulfil the obligations which they assume by participating in the tendering procedure and, in particular, that the goods are actually exported. By fixing the security at a uniform amount regardless of the tobacco variety and there­ fore regardless of its value, the Commission showed that the increase was not linked to market developments.

97 The applicant also considers that the purpose of the increase was to exclude certain potential buyers, which also demonstrates that the principle of equal treatment was infringed.

98 By way of reply, the Commission states that the amount of the security was not at all excessive and was needed to cover the difference between the export sale price and the Community market price and, at the very least, the effect of export refunds.

99 It also points out that the applicant took part in a fifth tendering procedure for which a security of ECU 0.7 was required: this shows that it was in no way excluded from intervention sales.

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104 Finally, it is necessary to emphasize that in its management of the CMO for tobacco the Commission is required in particular to ensure that disposal of tobacco does not disturb the market. The Commission's insistence on strict guar­ antees is in principle indicative of the fact that it is properly fulfilling its duty. Guarantee conditions of the kind laid down by Regulation No 3040/91 necessarily mean that undertakings not in a position to meet them are shut out. Such an effect, which is inherent in any guarantee condition, does not therefore constitute a breach of the principle of equal treatment (see Case C-358/90 Compagnia Italiana Alcool ν Commission [1992] ECR I-2457, paragraph 54). In any event, since the successful tenderers in the fourth tendering procedure included small and medium- sized undertakings, the guarantee conditions did not in practice have the effect of preventing such undertakings from participating in that procedure.

105 It follows that the pleas alleging breach of the principle of proportionality and breach of the principle of equal treatment are unfounded.

106 It is clear from the foregoing that Regulation No 3040/91 is not, as a result of increasing the amount of the security, vitiated by any illegality such as to cause the Community to incur non-contractual liability vis-à-vis the applicant.

107 The request made by the applicant in its reply that an expert should be appointed and the Commission called on to produce further documents cannot be upheld. In the first place, the documents in question are not necessary in order to resolve the dispute and, secondly, it would serve no purpose to appoint an expert to assess the alleged damage in this case since the applicant has not established that the Com­ mission's conduct of which it complained was illegal.

THE COURT OF FIRST INSTANCE (Fourth Chamber)

hereby:

application;; 1. Dismisses the application

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costs.. 2. Orders the applicant to pay the costs