T-201/96

SMANOR AND OTHERS v COMMISSION

O R D E R O F T H E C O U R T O F FIRST INSTANCE (Second Chamber) 3 July 1997 *

In Case T-201/96,

Smanor SA, a company incorporated under French law, established at Saint- Martin-d'Écublei, France, and

Hubert Ségaud and Monique Ségaud, residing at Saint-Martin-d'Écublei,

represented by Laurence Roques, of the Val de Marne Bar, 7-9 Rue du Général de Larminat, Créteil, France,

ORDER OF 3. 7. 1997 — CASE T-201/96

APPLICATION, first, for a declaration that, by failing to bring infringement pro- ceedings against the French Republic under Article 169 of the EC Treaty, the Commission has failed to act, and, second, for compensation for the damage aris- ing out of that failure,

T H E C O U R T O F FIRST INSTANCE O F T H E E U R O P E A N C O M M U N I T I E S (Second Chamber),

composed of: C. W. Bellamy, President, B. Vesterdorf and A. Kalogeropoulos, Judges,

Registrar: H. Jung,

makes the following

3 O n 6 November 1986, taking the view that the various proceedings brought against it had been the cause of its financial difficulties and that the regulations on which they were based were unlawful, it brought an action against the French State seeking compensation for the damage it had thereby suffered.

4 In addition, by letter dated 24 November 1986 to the Commission, it lodged a complaint against the French Republic, claiming that French Decree N o 82-184 of 22 February 1982 amending Decree N o 63-695 of 10 July 1963 on the prevention of fraud with regard to fermented milk and yoghurt was contrary to Community law and in particular to Council Directive 79/112/EEC of 18 December 1978 on the approximation of the laws of the Member States relating to the labelling, pre- sentation and advertising of foodstuffs for sale to the ultimate consumer (OJ 1979 L 33, p. 1). In response to that complaint, the Commission informed Smanor, by letter of 3 April 1988, that a letter of formal notice would be sent to the French Republic under Article 169 of the EC Treaty.

5 In 1987, judicial settlement proceedings were brought against Smanor before the Tribunal de Commerce (Commercial Court), L'Aigle, which considered that Smanor's financial problems stemmed from the French rules relating to yoghurt and, by judgment of 21 September 1987, requested the Court of Justice to give a preliminary ruling on the interpretation of Articles 30 to 36 of the Treaty and Articles 5, 15 and 16 of Directive 79/112/EEC in the light of Decree N o 82-184. However, by judgment of 5 April 1988, upheld by judgment of the Cour d'Appel (Court of Appeal), Caen, of 27 April 1989, the Tribunal de Commerce, L'Aigle, finding, inter alia, that there was no reconstruction plan and insufficient cash to

7 Decree N o 82-184 was subsequently, according to the applicants, repealed and replaced by Decree N o 88-1203 of 30 December 1988.

8 By judgment of 16 October 1990 given in the context of the action for damages brought in 1986 against the French State, the French Cour de Cassation (Court of Cassation) dismissed Smanor's appeal against a judgment of the Cour d'Appel, Caen, of 21 April 1988 rejecting its claim for damages on the ground that the food inspectorate had not been guilty of any serious fault in bringing proceedings against the company.

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SMANOR AND OTHERS v COMMISSION

9 Following its first complaint lodged against the French Republic on 24 November 1986 (see paragraph 4 above), Smanor lodged further complaints in 1990, 1991, 1993 and 1995 concerning the unlawfulness of the French regulations relating to yoghurt and the French Republic's alleged violation of its right to reparation.

10 By letter dated 9 October 1996, referring to its letter of 30 July 1996 in which it had already requested that the Commission state its definitive position on those complaints, Smanor, through its manager Mr Ségaud, called upon the Commission to initiate infringement proceedings against the French Republic. In its letter, it essentially asked the Commission, with a view to enabling it to bring an action for damages against the French State, to find that the French Republic had committed the infringements alleged, consisting of the failure to transpose Directive 79/112 within the prescribed period, of the failure of the French courts in the judicial settlement proceedings to respect the preliminary ruling procedure laid down in Article 177 of the Treaty and of the refusal to pay compensation following the judgment in Smanor, cited above.

14 In their application, the applicants claim that the Court should:

— declare that the Commission has failed to act;

— rule, on the basis of Article 215 of the Treaty, that the Commission has thereby incurred non-contractual liability towards both Smanor SA and the joint appli- cants Hubert and Monique Ségaud, its founders, salaried managers and major- ity shareholders, and that it should pay them compensation for the damage suf- fered in the sum of E C U 4 562 884; and

— order the Commission to pay the costs.

15 In its objection to admissibility, the Commission contends that the Court should:

— find the action brought by Smanor and the joint applicants Hubert and Monique Ségaud inadmissible;

— order the Commission to pay the costs.

Admissibility

17 The applicants have not specifically sought an order dismissing the objection to admissibility or joining it to the merits. Nevertheless, since in their observations on the objection to admissibility they claim that the Court should declare that the Commission has failed to act and rule that the Commission has thereby incurred non-contractual liability, they must necessarily be considered to have sought the dismissal of the objection raised.

18 Under Article 114 of the Rules of Procedure, if a party applies to the Court for a decision on admissibility, the remainder of the proceedings on the objection to admissibility are to be oral, unless the Court decides otherwise. In the present case, the Court considers that it has sufficient information from the documents before it to give a decision without opening the oral procedure.

The claim seeking a finding that the Commission has failed to act

Arguments of the parties

21 The applicants contend that the Commission's failure to act has been demonstrated in this case since it implicitly admits that it did not adopt any position on the suc- cessive calls to act addressed to it on 30 July and 9 October 1996. They further stress that they brought to the attention not only of the Commission but also of the various French courts a series of instances typifying the conduct of the French legislature and public authorities. Finally, they claim, in substance, that the Com- mission, having dealt diligently with their first complaint lodged in 1986 by sub- mitting observations critical of the French rules during the preliminary ruling pro- cedure before the Court of Justice, was obliged following the judgment delivered by that Court on 14 July 1988 to ensure that the French Republic fulfilled its unconditional obligation to make good the damage caused by the infringements of Community law for which it was responsible.

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Findings of the Court

22 It has consistently been held that where an action is brought by a natural or legal person for a declaration of failure to act in that, by not initiating infringement pro- ceedings against a Member State, the Commission has failed, in breach of the Treaty, to take a decision, that action is inadmissible (Star Fruit and Bernardi, both cited above).

23 It is clear from the scheme of Article 169 that the Commission is not obliged to commence proceedings under Article 169 of the Treaty but has a discretion in that regard which excludes the right for individuals to require it to adopt a specific pos- ition (Star Fruit, cited above, paragraph 11; Case T-126/95 Dumez v Commission [1995] ECR II-2863).

Arguments of the parties

27 The Commission considers that the claim for damages is clearly inadmissible, inas- much as the applicants are seeking compensation for damage which they claim to have been caused by the Commission's alleged failure to act. That claim for dam- ages, arising out of a failure to act alleged in a head of claim which has been held to be inadmissible, must also be declared inadmissible (Bernardi cited above, para- graph 39).

28 The applicants contend that they are fully justified in seeking compensation for the damage which they consider to be attributable to the Commission's failure to act. The Commission persisted in its refusal to adopt a position whereas, had it carried out its duty to monitor compliance with Community law, it could have ensured both that the judicial settlement proceedings brought against Smanor were sus- pended and that compensation was granted as a result of the wrongful conduct of the French public authorities.

Findings of the Court

29 In their claim for damages, the applicants seek to have made good the damage which they consider they have suffered as a result of the Commission's failure to initiate infringement proceedings against the French Republic.

30 Since the Commission is under no obligation to commence infringement proceed- ings under Article 169 of the Treaty, its decision not to do so was not, in any event, unlawful and thus cannot give rise to non-contractual liability on the part of the

Costs

34 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. Since the applicants have been unsuccessful, they must be ordered to bear their own costs and those of the Commission.

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ORDER OF 3. 7. 1997 — CASE T-201/96

35 Under Article 87(4) of the Rules of Procedure, Member States which have inter- vened in the proceedings are to bear their own costs. Pursuant to that provision, if the French Republic had been granted leave to intervene, it would have borne its own costs. The same must apply, a fortiori, to any costs which it may have incurred for the purposes of its application for leave to intervene in the present case, which it is not necessary to examine.

O n those grounds,

Luxembourg, 3 July 1997.

H. Jung C. W. Bellamy

Registrar President

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