T-183/97

Commission of the European Communities, represented by Eugenio de March, of its Legal Service, acting as Agent, assisted by Alberto Dal Ferro, of the Vicenze Bar, with an address for service in Luxembourg at the office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre, Kirchberg,

defendant,

* Language of the case: Italian.

II - 1476

MICHELI AND OTHERS v COMMISSION

APPLICATION for suspension in whole or in part of the operation of the Com- mission's decision of 26 March 1997 adopting the principal list and the reserve list of proposals for actions eligible for a Community contribution under the MAST III programme and, accordingly, suspension of the operation of the decision excluding the Posible proposal,

ORDER OF 26. 9. 1997 — CASE T-183/97 R

2 Article 2 of Decision 94/804 determines the 'amount deemed necessary' for carry- ing out the specific programme for 1994 to 1998 as E C U 228 million. That amount was increased to E C U 243 million by Decision 616/96. Annex II to Decision 94/804 sets out an 'indicative breakdown' of that amount between four areas of research. Area A covers marine science, Area B strategic marine research, Area C marine technology and Area D supporting initiatives. That breakdown does not exclude the possibility that a project could relate to several areas. An indicative amount of E C U 91 million is envisaged for Area A.

II - 1478

MICHELI AND OTHERS v COMMISSION

tion of three other European bodies: the Consejo Superior de Investigaciones Cientificas (CSIC, Madrid), the Netherlands Institute of Ecology, Centre for Estuarine and Coastal Ecology (Nioo-Cemo, Yerseke, The Netherlands) and the University of Nice-Sophia Antipolis (France).

5 For the Posible proposal, D r Carla Micheli, a researcher with ENEA, was named in the proposal submitted by that body (Annex II to the application for interim measures) as the 'contact person within the coordinating body'. It appears from the documents before the Court that D r Micheli is the initiator and scientist in charge of the Posible proposal. It is common ground that before the Posible pro- posal was submitted Dr Micheli received copies, as provided for in point 6 of the second call for proposals, of, inter alia, the work programme, the booklet contain- ing information on the procedure followed during the evaluation of proposals, dated 16 April 1996, known as the 'White Booklet', and the guide, known as the 'Blue Guide', published in January 1994 to provide participants with an insight into, in particular, the handling of project proposals submitted in the context of Community research and development programmes.

7 In the context of the first part of the selection procedure, the White Booklet and the Blue Guide state that the examination of the proposals for actions by the inde- pendent evaluators is divided into two consecutive stages and entrusted to panels of at least three experts. In stage 1 each proposal is examined by a panel of experts responsible for evaluating its scientific and technical quality. That stage is elimina- tory. The White Booklet states that proposals obtaining less than 70 points in stage 1 will be excluded. In stage 2 a larger panel of evaluators, including specialists in scientific policy, industrial sectors and management, or persons with experience relevant to the economic, social or environmental aspects of the proposal, evaluates its strategic, economic and policy aspects. Each stage begins with an individual examination of the proposals by each expert, followed by group discussions aimed at reaching agreement on a common evaluation. Following each of the stages the evaluators draw up an evaluation report, or 'consensus report', on the proposal examined. That report, according to the White Booklet (paragraphs 28 and 30), contains, for each individual criterion, the average of the points awarded by each evaluator following discussion and the overall average obtained, together with the evaluators' observations in writing on the proposal for action, which will allow the Commission, where it informs the candidates of the decision adopted in regard to their proposals, to indicate which are the strong points and the weak points of their proposals and in what way they might be improved. The consensus report drawn up at the end of stage 1 also includes a common opinion of the evaluators for or against admission to stage 2 of the examination by independent experts. That report is communicated to the panel of experts responsible for evaluating the proposal in stage 2.

9 It is common ground, however, that in stage 1 of the evaluation procedure scien- tific and technical merits of 18 of the 214 proposals submitted to the Commission were evaluated twice, by two separate panels of experts, on the basis of a statement in the Blue Guide that '[t]o verify the standards and the soundness of the evalua- tion, the Commission staff may request that between five and ten per cent of pro- posals are re-evaluated by a second panel of experts. In cases where this second evaluation highlights a large difference of opinion, a third evaluation is possible'. According to the document of 18 February 1997 relating to these control evalua- tions, which has been produced by the Commission, the proposals which were to be evaluated twice were selected by the Commission in this instance before the examination had commenced, by picking each 15th proposal in alphabetical order. The Commission stated at the hearing of the parties, in answer to a question put by the President of the Court, that two proposals, including the AOSGE proposal, were also evaluated twice because of their scope and complexity. According to the document of 18 February 1997 referred to above, the Commission had determined at the outset, in the case of each proposal, which of the two panels of experts would carry out the examination provided for in the White Booklet, on which the Commission would base its evaluation of the proposal, and which would carry out the second control evaluation as provided for in the Blue Guide. Although they were informed of that dual evaluation procedure, however, the panels of experts did not know which proposals would be evaluated twice and examined the pro- posals before them independently.

i2 In the second part of the evaluation procedure, the Commission selected the pro- posals for action to be funded, on the basis not only of their classification after the first part into four categories (Al, A2, B and C) following the points awarded by the independent experts but also of other criteria referred to in the White Booklet, such as the funds available, the need for a balance between objectives and the need to avoid duplication. The Commission submitted a draft principal list and reserve Ust to the Programme Committee. According to the documents before the Court, the draft principal list included, in Area A (marine science), all the proposals clas- sified on the basis of the points awarded in category A2 and a number of proposals classified in category B. The draft reserve list contained, in Area A, ten proposals, all classified in category B. Among these, the AOSGE proposal was in second pos- ition and the Posible proposal in seventh position on the Ust.

1 3 It is apparent from the draft minutes of the meeting of the Programme Committee of 24 and 25 February 1997, which are before the Court, that the committee

II -1482

MICHELI AND OTHERS v COMMISSION

approved the draft principal list submitted by the Commission. The draft reserve list was also approved — according to the draft minutes referred to above and to Annex II thereto — after it had been amended by the Commission, which, taking into consideration the committee's desire to strike a better balance in the proposals for action on the reserve list between the principal areas A, B, C and D of the MAST III programme, struck out the last five proposals in Area A and added one proposal in Area C.

is According to Article 2 of that decision, the proposals for action on the reserve list will receive Community funding 'in so far as budget appropriations would remain available after the exhaustion of the commitment appropriations used for the actions appearing in the principal lists, in particular in the event of withdrawal of actions appearing in this list, in the event of negotiation of contracts to amounts lower than those provided for in this decision, in the event of non-observation of their obligations by contract participants if additional funds would be allocated by the budgetary Authority or in the event of adjustments of the budgetary appro- priations within the same post. Recourse to the [reserve] list ... will be made according to the priorities fixed therein and according to the aims of the specific programme, as well as according to the progress made in contract negotiations, and to the amounts made available'.

i6 In a letter dated 26 March 1997 to Dr Micheli, which she received on 20 May 1997, the Director of Directorate D 'RTD actions: marine science and technology' in

II -1483

ORDER OF 26. 9. 1997 — CASE T-183/97 R

the Commission's Directorate-General for Science, Research and Development (DG XII) informed E N E A that, following an evaluation by independent experts and consultation with the MAST III Programme Committee, the Posible proposal had not been selected for financial contribution under that programme (Annex 3 to the application for interim measures). The Commission explained in its letter that it had been obliged to select a small number of proposals for actions to be funded owing to the limited budget appropriations available.

II -1484

MICHELI AND OTHERS v COMMISSION

reserve list of actions to be funded under the MAST III programme and, accord- ingly, of the measure excluding the Posible proposal from such funding. In the alternative, they seek partial suspension of the Commission's decision of 26 March 1997, in so far as it adopts the reserve list.

20 The Commission submitted its written observations in a document registered at the Court on 23 July 1997. At the request of the President of the Court, it pro- duced a number of documents. The parties presented oral argument on 4 Septem- ber 1997.

Law

2i Under Article 185 of the EC Treaty, taken together with Article 4 of Council Decision 88/591/ECSC, EEC, Euratom of 24 October 1988 establishing a Court of First Instance of the European Communities (OJ 1988 L 319, p. 1), as amended by Council Decision 93/350/Euratom, ECSC, E E C of 8 June 1983 (OJ 1993 L 144, p. 21) and Council Decision 94/149/ECSC, EC of 7 March 1994 (OJ 1994 L 66, p. 29), the Court of First Instance may, if it considers that circumstances so require, order that application of the contested act be suspended in cases before it.

24 Accordingly, all the applicants, and a fortiori Dr Micheli, have a direct and indi- vidual interest in obtaining the funding requested, without which the project can- not be carried out. Moreover, the fact that the project was excluded from both the principal list and the reserve list entails a loss of scientific prestige for the appli- cants.

25 The Commission takes the view that the main action is manifestly inadmissible on the ground that the applicants are not directly concerned by the contested decision. The application for suspension of application of the decision must there- fore be declared inadmissible. The Commission argues that the Posible project was submitted by E N E A as coordinator and by three other research institutions from various Member States, namely CSIC (Spain), Nioo-Cemo (The Netherlands) and the University of Nice (France), but not by the applicants. The applicants cannot therefore be regarded as the persons to whom the contested decision was directly addressed.

II -1486

MICHELI AND OTHERS v COMMISSION

Findings of the President

26 Article 104(1) of the Rules of Procedure provides that an application to suspend the operation of a measure is admissible only if the applicant is challenging that measure in proceedings before the Court of First Instance. According to settled case-law, the issue of the admissibility of the main action should not, in principle, be examined in proceedings relating to an application for interim measures. It should be reserved for the examination of the main application, unless it is appar- ent at first sight that the main action is manifestly inadmissible, so as not to pre- judge the Court's decision on the substance of the case (see, most recently, the order in Government of the Netherlands Antilles v Council, cited above, paragraph 17).

ORDER OF 26. 9. 1997 — CASE T-183/97 R

brought to the knowledge of the persons concerned before they submitted their proposal to the Commission. In the present case, contrary to its requirements, the A O S G E proposal was allowed to proceed to stage 2 of the examination by inde- pendent experts although it had not obtained the requisite minimum of 70 points in stage 1 of the examination. It was because, unlike the other proposals for actions, it was evaluated twice at stage 1 (see paragraphs 9 to 11 above) that it was not excluded at that point from funding under the MAST III programme. By thus departing from the applicable procedure the Commission infringed the principles of transparency and proper administration, which require the establishment and application of a detailed procedure which is brought to the knowledge of the par- ticipants. The Commission also infringed the principle of non-discrimination and misused its powers.

30 Moreover, the applicants dispute the extent of the discretion which the Commis- sion took it upon itself to exercise in departing from the classification at the end of the first part of the procedure, based on the points awarded by the independent evaluators. They complain, in particular, that the Posible proposal, which had obtained 99 points, was excluded from the reserve list, while the AOSGE pro- posal, which had only 96 points, was included.

32 Secondly, the applicants maintain that the contested decision infringes the principle of transparency and contains no statement of reasons in relation to the dual evalu- ation of the AOSGE proposal or the Commission's selection, in so far as it departs from the classification of the proposals according to the number of points obtained. Furthermore, the draft decision submitted to the Commission (Annex VI to the application) mentions neither the number of points obtained by the various proposals for actions nor their overall assessment by the evaluators. N o r did the Commission give its reasons for using the funds available for Area A to fund pro- posals for actions relating to other areas. In that regard, the applicants have stated in their main application and confirmed at the hearing of the parties that if all the furids available for Area A had been used and if the AOSGE project had been excluded from the reserve list, all the projects now in the reserve list which obtained between 100 and 105 points would have been included on the principal list and the Posible project would have been first on the reserve list.

33 The Commission contends, however, that the evaluation procedure complied with the principle of transparency and the obligation to state reasons. The reason for excluding the Posible project was that there were insufficient budget resources for the large number of projects submitted, as is clear from the Commission's letter to D r Micheli of 26 March 1997, referred to above. The Commission deemed it appropriate to present a principal list whose funding corresponded to the amounts provided for indicatively and a relatively limited reserve list from which all the projects below fifth place were automatically excluded.

Findings of the President

38 As regards the first two pleas, alleging infringement of the procedure for evaluat- ing proposals for actions and failure to provide an adequate statement of reasons for the contested decision, the President of the Court of First Instance considers it appropriate to begin by examining the complaints relating more specifically to the selection made by the Commission in the second stage of the evaluation of the proposals.

39 In that regard, the applicants criticize the Commission, first, for having departed, in the reserve list, from the classification of the proposals according to the number of points awarded by the independent evaluators during the first part of their assessment.

II -1490

MICHELI AND OTHERS v COMMISSION

40 It is not prima facie apparent, however, that in the procedure for evaluating pro- posals for actions established by Decision 94/804 adopting the MAST III pro- gramme, and described in particular in the White Booklet, the Commission, when selecting the proposals eligible for Community assistance, can in principle be denied a discretion to depart, where appropriate, from the classification established following the expert evaluation.

II -1491

ORDER OF 26. 9. 1997 — CASE T-183/97 R

43 It follows from those two documents that the Commission is assisted, during an initial part of the procedure devoted to the individual evaluation of each of the actions proposed, by panels of independent experts responsible for examining the proposals according to a precise procedure set out in the White Booklet (see para- graph 7 above) and for drawing up, for each proposal, two 'consensus reports' relating, first, to the scientific and technical quality of the action evaluated and, secondly, to its strategic, economic and policy aspects. Those outside experts evaluate and assess the proposed actions on the basis of the criteria set in out in Annex II to the fourth RTD framework programme, referred to above, and Article 4(3) of Council Decision 94/763/EC of 21 November 1994 concerning the rules for the participation of undertakings, research centres and universities in research, technological development and demonstration activities of the European Commu- nity (OJ 1994 L 306, p. 8). Annexes I and II to the White Booklet set out those various criteria in detail, indicating weightings and minimum numbers of points required. That first part of the selection procedure ends with the proposals being classified and divided into four categories by the Commission, according to the points awarded and the observations recorded by the independent evaluators.

47 It t h u s appears at this stage of the examination, that, c o n t r a r y t o w h a t t h e appli- cants argue, t h e C o m m i s s i o n was n o t necessarily b o u n d b y the classification of t h e p r o p o s a l s for actions according t o the p o i n t s a w a r d e d w h e n it a d o p t e d the list of actions accepted o r acceptable for C o m m u n i t y assistance.

48 However, the applicants claim, secondly, that the contested decision contains no statement of reasons as regards the Commission's comparative examination of the proposals for actions. They complain, in particular, that the draft decision submit- ted to the Commission for the purposes of the written procedure gives no indica- tion of the points awarded to, or overall evaluation of, the proposed actions by the independent experts.

49 In that regard, it must be borne in mind, 'where the Community institutions have such a power of appraisal, respect for the rights guaranteed by the Community

II- 1493

ORDER OF 26. 9. 1997 — CASE T-183/97 R

legal order in administrative procedures is of even more fundamental importance. Those guarantees include, in particular, the duty of the competent institutions to examine carefully and impartially all the relevant aspects of the individual case, the right of the person concerned to make his views known and to have an adequately reasoned decision. Only in this way can [the Community judicature] verify whether the factual and legal elements on which the exercise of the power of appraisal depends were present' (Case C-269/90 Hauptzollamt München-Mitte v Technische Universität München [1991] ECR 1-5469, paragraph 14).

II - 1494

MICHELI AND OTHERS y COMMISSION

reasons, in the light of the need to ensure, in accordance with the procedure described in the White Booklet, a balance between the objectives pursued by the MAST III programme. According to the Commission, the AOSGE proposal was the only one relating to a research activity concerning the 'ice-covered seas of the northern hemisphere', which is one of the objectives set out in the work pro- gramme.

53 T h a t explanation, however, w a s n o t c o m m u n i c a t e d t o the applicants before t h e y m a d e the present application for interim measures. It is therefore necessary t o ascertain whether, at first sight, the s t a t e m e n t of reasons for the c o n t e s t e d decision w h i c h was b r o u g h t t o the applicants' k n o w l e d g e was sufficient, having regard t o its context, t o allow t h e m t o d e t e r m i n e w h e t h e r it was well f o u n d e d and w h e t h e r t o b r i n g proceedings before the C o u r t , and t o enable the C o u r t t o review its legality (see, in particular, Volger v Parliament, cited above, p a r a g r a p h 40).

54 In the present case the Commission sent Dr Micheli a 'consensus report' relating to the Posible proposal, dated 20 May 1997, with its letter of 26 March 1997 (see paragraph 16 above). The report referred to the points awarded to the proposal in question and its evaluation in respect of each group of criteria in the two consecu- tive stages of its examination by independent experts, together with the total num- ber of points obtained following that first part of the selection procedure, which was devoted to an individual evaluation of the proposed actions.

56 In order to assess whether that statement of reasons relating to the comparative examination carried out by the Commission may, at first sight, be regarded as suf- ficient, it should first be borne in mind that, as has consistently been held, '[i]he principle that there must be a sufficiently precise statement of reasons, enshrined in Article 190 of the Treaty, is one of the fundamental principles of Community law' (Case T-61/89 Dansk Pelsdyravlerforening v Commission [1992] ECR 11-1931, paragraphs 129 and 131; see also Technische Universität München, cited above). However, the Court of Justice has held in that regard that the extent of the obliga- tion to state reasons depends on the nature of the act in question and the gravity of its consequences for those to whom it is addressed. It is sufficient for it to reveal clearly and unequivocally the reasoning of the institution. For the persons con- cerned to be able to know the reasons for the measure and for the Community judicature to exercise its power of review, it is not necessary for the measure to specify the relevant elements of fact and of law (see, in particular, Case C-l81/90 Consorgan v Commission [1992] ECR 1-3557, Case C-466/93 Atlanta Frucht- handelsgesellschaft and Others v Bundesamt für Ernährung und Forstwirtschaft [1995] ECR 1-3799 and Case T-85/94 Branco v Commission [1995] ECR 11-45).

57 I n t h e present case, the s e c o n d plea, alleging t h a t t h e contested decision did n o t c o n t a i n an adequate statement of reasons, therefore raises in particular the delicate q u e s t i o n whether, having regard t o the discretion w h i c h the C o m m i s s i o n enjoyed at t h e second stage of evaluating the p r o p o s a l s a n d t o t h e v e r y nature of t h e c o n - tested decision and its impact o n the applicants' p o s i t i o n , the information p r o v i d e d t o t h e m in t h e t w o letters referred t o above w a s — in t h e general context of t h e procedure initiated by the second call for proposals under the MAST III pro- gramme — sufficient to enable them to determine whether it was lawful and to allow the Court to exercise its review. In the light of the complexity of that ques- tion, it must be examined by the Court when it rules on the main action.

60 Furthermore, if the contested decision were to be annulled, the Commission would be required to demand reimbursement of the amounts unlawfully paid in the meantime, in order to allocate them to other actions on the basis of the new list which it would have to adopt pursuant to the Court's judgment. The recipients of Community assistance excluded from the new list would thus suffer serious and irreparable damage.

I I -1497

ORDER OF 26. 9. 1997 — CASE T-183/97 R

6i The Community might also be held liable for giving the recipients of funding expectations which might be transformed into an actual right.

62 For all those reasons, the applicants request the Court to suspend operation of both the principal list and the reserve list, in so far as both are affected by serious and manifest irregularities. In the alternative, they ask the Court to suspend the reserve list alone, should it find that, at first sight, the alleged irregularities have an immediate and direct impact only on that list.

63 The Commission disputes those arguments. It claims that the applicants have no interest in the suspension of the principal list, since they themselves acknowledge that the Posible project would not have been included on that list even if the A O S G E proposal had been excluded from the reserve list.

65 A c c o r d i n g t o established case-law, t h e u r g e n c y of t h e a d o p t i o n of interim measures m u s t be considered b y examining w h e t h e r t h e i m p l e m e n t a t i o n of the contested measure, p r i o r t o the a d o p t i o n of the decision of t h e C o u r t o n the main issue, is such as t o give rise, for t h e parties r e q u e s t i n g t h e measures, t o serious and irrepa- rable d a m a g e w h i c h could n o t b e m a d e g o o d if t h e contested decision w e r e annulled o r w h i c h , despite its interim n a t u r e , w o u l d be d i s p r o p o r t i o n a t e t o t h e defendant's interest in having the measures i m p l e m e n t e d , even w h e n t h e y are the subject of legal proceedings. It is for the applicants to p r o v e that those c o n d i t i o n s are satisfied (see, in particular, the o r d e r of t h e President of the C o u r t of F i r s t Instance in C a s e T-191/96 R CAS Succhi di Frutta v Commission [1997] E C R 1 1 - 2 1 1 , p a r a g r a p h 31).

66 It follows that, for the p u r p o s e of d e m o n s t r a t i n g the u r g e n c y of the a d o p t i o n of t h e interim measure w h i c h t h e y request, the applicants m a y rely only o n the risk of serious a n d irreparable damage w h i c h t h e y p e r s o n a l l y w o u l d r u n in t h e absence of such a measure, and n o t o n damage w h i c h m i g h t b e suffered b y any o t h e r can- didates w h o m a y have been unjustly excluded from the principal list or t h e reserve list.

67 As regards the damage allegedly suffered by them, the applicants stated at the hear- ing of the parties that the Posible proposal for action cannot be implemented with- out a Community contribution under the MAST III programme. That would pre- vent them from pursuing their research activity and would seriously damage their scientific prestige, in particular vis-à-vis other participants in that project.

7i In their main action the applicants maintain, in essence, that if the procedure had been conducted properly (that is, according to the applicants, if all the credits available for Area A (marine science) had been used instead of part of those credits being transferred to Areas B and C and if the AOSGE project had been excluded from the reserve list) all the projects now on the reserve list with between 100 and 105 points would have been included on the principal list and the Posible project would have been in first place on the reserve list. At the hearing of the parties in these interlocutory proceedings the applicants confirmed their view that if all the funds available for Area A had been used to fund projects relating to that area the reserve list would have been shorter and the Posible project, which in that case would have been in first place on the reserve list, would have had a more realistic prospect of obtaining funding. Although they also seek suspension of operation of the principal list on the ground that the entire procedure was void, they have expressly acknowledged that suspension of the reserve list would be a 'sufficient measure'.

II-1500

MICHELI AND OTHERS v COMMISSION

72 In that regard, it is not at first sight apparent from the evidence adduced by the parties or the documents before the Court that funds from Area A were unlaw- fully transferred to other areas or that the credits available for Area A would have made it possible to fund, in addition to the projects on the principal Ust, the projects on the reserve list which had obtained between 100 and 105 points and thus to include them on the principal list.

75 In any event, when the opposing interests are weighed up there is a clear argument against granting the principal application for suspension of operation of the prin- cipal list and the reserve list. To grant the measure requested would seriously dam- age the rights of the third parties whose projects are on the principal list by freez- ing the negotiation of contracts and the payment of Community assistance to which they are entitled under the contested decision. Furthermore, it would, while the main action is pending, hinder implementation of the MAST III programme following the second call for proposals. By considerably delaying implementation of the MAST III programme in that way, suspension of the operation of the con- tested decision would hinder the action of the Community in that sphere, whereas the thirteenth recital in the preamble to Decision 94/804, adopting the MAST III programme, refers to the need to promote the implementation of that programme by simplifying and accelerating the application and selection procedures and mak- ing them more transparent. Having regard to the seriously damaging consequences for the third parties referred to above and for the Community 5 the operation of

II-1501

ORDER OF 26. 9. 1997 — CASE T-183/97 R

the principal list were to be suspended, such an interim measure can in no way be an appropriate solution in the present case.

76 It is therefore necessary to consider the applicants' alternative application for sus- pension of the operation of the reserve list alone. In that regard, it must be deter- mined whether, if the reserve list were to remain in force pending the judgment in the main action, the Posible project might be deprived of the possibility of receiv- ing a Community contribution if the contested decision should be annulled.

so It is therefore apparent that the alleged risk that the available appropriations will be exhausted by the funding of the projects in the allegedly unlawful reserve list is remote, uncertain and aleatory. It cannot materialize before the principal list has been exhausted and is, moreover, linked to the occurrence of events which are dif- ficult to foresee at this stage, such as those referred to above.

si Such a purely potential risk of damage cannot justify suspending the operation of the reserve list. Should the risk materialize, the applicants would be able to raise the matter before the Court at that stage.

82 The non-material damage associated with the loss of scientific prestige which the applicants claim to have sustained owing to the exclusion of the Posible project from the reserve list could be made good by the annulment, if decided by the Court, of the contested decision in so far as it adopts the reserve list.

83 For all those reasons, the conditions justifying suspension of operation of the reserve list are not satisfied in the present case.

II-1503

ORDER OF 26. 9. 1997 — CASE T-183/97 R

Luxembourg, 26 September 1997.

H. Jung A. Saggio

Registrar President

II-1504