C-106/98

COMITÉ D'ENTREPRISE DE LA SOCIÉTÉ FRANÇAISE DE PRODUCTION AND OTHERS V COMMISSION

OPINION OF ADVOCATE GENERAL RUIZ-JARABO COLOMER delivered on 9 November 1999 *

I. Introduction II. Facts

2. According to the order of the Court of First Instance which is being challenged, the background to the present proceedings may be summarised as follows:

1. Various bodies representing the staff of an audiovisual production company which 'Société Française de Production (herein- has received State aid are challenging the after "SFP") is a company controlled by the legality of the Commission decision which French State, whose principal activity is the declared that aid incompatible with the production and broadcasting of television common market, and have brought an programmes. action under the fourth paragraph of Article 173 of the EC Treaty (now, follow- ing amendment, Article 230 EC). I do not consider that a judicial decision is the appropriate way of expressing the social dimension of the Treaties in the context of By decisions of 27 February 1991 and proceedings. I do think, however, that the 25 March 1992 the Commission author- present appeal should help to shed light on ised two payments of aid made by the the interpretation which the Court of French authorities to SFP between 1986 Justice gives of the conditions which should and 1991 amounting to a total of FF 1 260 be met by persons in order for them to million. bring an action against a decision addressed to another person which is of direct and individual concern to themselves. It is highly desirable that, as regards a legal interest in bringing proceedings, the present case-by-case approach should be replaced The State subsequently carried out further by clearer and more reliable general cri- aid operations under which it granted teria. SFP FF 460 million in 1993 and FF 400 million in 1994. Several competitors claimed to suffer from the low prices * Original language: Spanish. charged by SFP as a result of the aid and

By decision of 5 May 1996, which gave rise III. The procedure before the Court of First to Communication 96/C 171/03, 2 the Instance Commission extended the proceedings to include further public aid of FF 250 mil- lion, which the French authorities had announced on 19 February 1996. 3. By application lodged at the Registry of the Court of First Instance on 24 June 1997, the works council of SFP, Syndicat National de Radiodiffusion et de Télévision CGT, Syndicat Unifié de Radio et de Télévision CFDT, Syndicat National Force Ouvrière de Radiodiffusion et de Télévision No comments from other Member States or and Syndicat National de l'Encadrement other interested parties were received by Audiovisuel CFE-CGC brought an action the Commission following the initiation of under Article 173 of the EC Treaty against proceedings. the decision. The Commission raised an objection of inadmissibility pursuant to

1 — OJ 1995 C 80, p. 7. 2 — OJ 1996 C 171, p. 3. 3 — OJ 1997 L 95, p. 19.

I - 3662

COMITÉ D'ENTREPRISE DE LA SOCIETE FRANÇAISE DE PRODUCTION AND OTHERS V COMMISSION

Article 114(1) of the Rules of Procedure of I shall deal with each of these arguments in the Court of First Instance and the appli- turn, but first I shall consider an important cants submitted their observations regard- question raised as a preliminary point by ing that plea. the applicants.

4. On 18 February 1998 the Court of First Instance issued an order in which it allowed the objection raised by the defendant, dismissed the application as inadmissible (a) The applicants' preliminary point and ordered the applicants to pay the costs.

it may, the applicants' statements, although extent contrary to the common interest'. It interesting, are more like proposals for is apparent from the same judgment 5that legislative policy than an interpretation de the Commission took as its basis in apply- lege lata of the current legal position. ing that provision the reduction of capacity resulting from the restructuring of the undertaking, the fact that the laid-off workers were the main beneficiaries of the aid and the limited amount of aid granted. What confirms this conclusion is the wide amount of discretion enjoyed by the Com- mission when it rules on compatibility on 8. There is nothing in either the treaties or the basis of inter alia social criteria. 6 the case-law of the Court of Justice which supports the idea that, so far as State aid is concerned, the Commission should act and monitor the legality of such aid in accor- dance with the general objectives of the Community, in particular the social objec- tives, to any greater extent than in other areas of Community activity, such as the monitoring of concentrations of undertak- ings. In both areas the primary objective of 9. At all events, even if Article 92(3)(c) of Community policy is to maintain an effec- the EC Treaty could be interpreted unequi- tive level of competition. vocally as permitting the authorisation of aid intended to improve the level of employment and social protection, it is doubtful whether on that ground alone it would be necessary for the Community system of State aid to be made subject to social policy considerations; it is even more difficult to see how, as a result, those The lessons which may be learnt from the actually benefiting under that social policy, Fonds National pour l'Emploi Français in particular employees, would, in the case relied on by the applicants do not context of Articles 92 and 93 of the EC permit any other conclusion. In that case Treaty (now Articles 87 EC and 88 EC), the Court merely upheld the legality of a occupy a position similar to that occupied Commission decision, establishing that spe- by those actually involved in competition, cific intervention by the State which was namely the undertakings. As a result the funding the redundancy and redeployment employees, or their recognised representa- costs resulting from a restructuring opera- tives, are not in theory entitled to challenge tion constituted aid but did not qualify for a decision unless they can provide proof exemption under Article 92(3 )(c) of the EC that the authorisation or refusal of aid has Treaty (now, following amendment, Arti- not only effects which are limited to a cle 87(3)EC). That provision states that certain aid may be authorised where it is intended 'to facilitate the development of 5 — Paragraph 6. certain economic activities or of certain 6 — I have the impression, however, that in the Fonds National economic areas, where such aid does not pour l'Emploi Français case it was considerations relating principally to the defence of free competition and not social adversely affect trading conditions to an protection which were paramount.

First, the Court of First Instance considered that the applicants could not properly rely on the reasoning contained in its judgments in Comité Central d'Entreprise de Verrier 7 (hereinafter 'the Verrier judgment') and Comité Central d'Entreprise de Vittel 8 (hereinafter 'the Vittel judgment'), in which it held that a Commission decision declar- 10. Finally, I do not think that at present ing that a transaction bringing about a Community law requires that the general concentration was compatible with the objective of a high level of employment and common market was of individual concern social protection should receive greater attention in the context of the European 7 — Case T-96/92 Comité central d'Entreprise de la S o c i é t é system of State aid than in the context of Genérale des Grandes Sources and Others v Commission the monitoring of concentrations, for 119951 ECR II-1213. 8 — Case T-12/93 Comité Central d'Entreprise de Vittel and example. Others v Commission [1995] ECR II-1247.

I - 3665

OPINION OF MR RUIZ-JARABO — CASE C-106/98 P

to the recognised representatives of the in a similar way to the Member State to employees of undertakings who might be which the decision was addressed, since the affected by that transaction. mere fact of being a party concerned cannot suffice to distinguish the applicants individually from any other third party which is potentially concerned.

I - 3666

COMITÉ D'ENTREPRISE DE LA SOCIÉTÉ FRANÇAISE DE PRODUCTION AND OTHERS V COMMISSION

I - 3667

OPINION OF MR RUIZ-JARABO — CASE C-106/98 P

is fulfilled in the case before it. If this is not reason of circumstances in which they are so, on clear grounds of procedural econ- differentiated from all other persons and by omy, 14 it does not examine to see whether virtue of those factors it distinguishes them the other condition is fulfilled. In spite of individually just as in the case of the person the order of the provisions of the Treaty addressed. article concerned, the Court has generally preferred to consider the requirement of individual concern. This is a wise option. The concept of a third party being indivi- dually concerned permits in principle It has been said, not without reason, that greater abstraction than the concept of the definition of individual concern given direct concern. 15 The establishment of by the Court of Justice moves the crucial criteria on which to base the definition of question towards the identification of attri- theoretical categories of individuals con- butes or circumstances which are likely to cerned by a decision seems to make it easier single out particular individuals. Be that as to achieve the objective of legal certainty it may, the way the Court of Justice has that must govern any provision concerning preferred to proceed is to analyse the merits access to judicial review than defining the of each case in order to ascertain whether direct nature of such concern, which the necessary requirements are met. It depends to a greater extent on the circum- should be pointed out that when making stances of each case. Moreover, in the field that analysis the Court tends to base its at issue, the question whether the autho- assessment on factual situations in order to risation or prohibition of a particular State ascertain whether the third party in ques- aid is of direct concern to a particular tion is individually concerned, leaving aside person is by its very nature more hypothe- the more abstract concept of specific qua- tical and, consequently, more difficult to lities. The Court of Justice uses the latter submit to judicial review. almost exclusively to dismiss the existence of individual concern, 17 which is probably the reason why its judgments have reflected a case-by-case approach.

undertaking and their trade associations, the applicant's interests may be affected by and (c) certain associations of economic the grant of the aid. 22 operators concerned in their capacity as a negotiator. These are, at all events, persons who are specified, or are at least capable of being specified, in relation to the disputed measure. 20. Although the Court of Justice has preferred not to give a categorical ruling, I think one may say generally and fairly certainly that any undertaking in genuine competition with an undertaking in receipt of State aid is entitled to bring an action for 18. It is generally acknowledged that an annulment against a decision relating to undertaking which is, or is potentially, in such aid where its position on the market receipt of aid whose compatibility with the might be prejudiced if the aid were common market is the subject of a Com- granted. 2 3Indeed, since within a system mission decision is entitled to bring pro- of free competition any advantage granted ceedings. 19 to one undertaking has the effect of pre- judicing its competitors, it follows that the latter cannot be any less directly and individually concerned by the aid than the undertaking to which it has been granted.

I - 3669

OPINION OF MR RUIZ-JARABO — CASE C-106/98 P

would be contrary to the provisions of the Treaty, but it is not always easy to bring fourth paragraph of Article 173 of the EC such situations within a coherent system. Treaty. That would be tantamount to The judgments in Van der Kooy and CIRFS adding a requirement which is not con- in particular demonstrate this. tained in the Treaty. It would be strange to say the least if entitlement to the substan- tive right to bring specific proceedings were made subject to the granting of certain procedural prerogatives. This is why I think 24. It seems appropriate to point out at this the Court of Justice regards such proce- stage of the analysis that the Court of dural prerogatives rather as indicators that Justice does not in principle recognise a the persons in whom they are vested are 'corporate' interest in bringing proceedings. individually concerned in relation to any An organisation whose purpose is to defend other undertaking. 24 the collective interests of a category of individuals cannot be regarded as being directly and individually concerned by a decision which affects the general interests of that category. 25 When trade associations 22. It is clear that the applicant bodies in bring an action for annulment they do not this case do not belong, nor do they claim therefore enjoy any greater prerogatives to belong, to categories comparable to than those of the individual undertakings those of the recipients of the aid or of which they represent. The same applies as competing undertakings. It is necessary regards the employees' representative therefore to examine the other cases in bodies, 26 which do not have a specific which the Court of Justice has recognised a legal interest in bringing proceedings even legal interest in bringing proceedings under when they have taken part in the discus- the fourth paragraph of Article 173 of the sions which preceded the disputed mea- EC Treaty. sure. 2 7

sidered that the application should be held particular the recovery of aid already to be admissible as regards the horticultur- granted, which meant it was possible to alists since they were significantly affected identify all the recipients. by the decision which required the aid to be abolished, 28 and inadmissible as regards the Landbouwschap, in respect of which he referred to the case-law concerning a "corporate" interest in bringing proceed­ ings, as mentioned above. The outcome So far as the Landbouwschap was con­ proposed by the Advocate General there­ cerned, the Court of Justice held that the fore came within the system of case-law body in question had taken an active part which I described above. The Court of in the procedure under Article 93(2) of the Justice did not share his opinion. EC Treaty and was one of the parties to the contract which established the preferential tariff. It was thus entitled to bring proceed­ ings because its position was affected as a negotiator of gas tariffs in the interests of the growers. 31 It is difficult not see this ruling as recognition of a 'corporate' inter­ est in bringing proceedings, which the As regards the applicant horticulturalists, Court of Justice had expressly rejected. the Court of Justice held that the Commis­ sion decision concerned them solely because of their objective status as profes­ sional horticulturalists established in the Netherlands who were entitled to receive the preferential tariff for gas in the same way as any other horticulturalist in the 26. Proof that the Van der Kooy judgment same situation. The decision was therefore, is not persuasive is provided by the Opinion as far as they were concerned, a measure of delivered by Advocate General Lenz when general application covering situations similar questions were also raised in the which were determined objectively and CIRFS case cited above. In that case the entailed legal effects for categories of CIRFS, the Association of the main inter­ persons envisaged in a general and abstract national manufacturers of synthetic fibres, manner who could not be regarded as being and several undertakings in that sector individually concerned by the contested individually, contested the legality of a decision. 2 9 This conclusion inevitably gives Commission decision not to initiate the the impression that the conditions required procedure provided for in Article 93(2) in in order to be regarded as individually respect of a project to grant aid. The concerned vary according to the number of Advocate General suggested that the appli­ recipients of the aid, 30 and it seems all the cation by the CIRFS should be ruled more strange since the case concerned in inadmissible according to the principles regarding the locus standi of trade associa­ tions, and that the action by one of the applicant undertakings which had taken 28 — Cited above. Opinion, p. 245. 29 — Paragraph 15. part in the proceedings resulting in the 30 — It is doubtful whether the Court of Justice would have given this ruling if the 'category of persons envisaged in a general and abstract manner' had only comprised three or four persons. 31 — Paragraphs 21 to 23.

The Court of Justice, however, preferred to make clear that the CIRFS had pursued, in the interest of those manufacturers, a number of actions connected with the policy of restructuring that sector. In parti- cular it had been the Commission's inter- locutor with regard to the introduction of the discipline and its extension and adapta- tion. Furthermore, during the pre-conten- tious procedure CIRFS had actively pur- sued negotiations with the Commission, in 28. I admit that I do not understand how particular by submitting written observa- the interest of a mere negotiator, who has tions to it and by keeping in close contact no connection with the process of free with responsible departments. The position competition, warrants more legal protec- of CIRFS in its capacity as negotiator of the tion than so many other legitimate interests discipline was therefore affected by the involved. In such circumstances, it is under- contested decision. 33 standable that the applicants who lodged the appeal should consider that the Court of First Instance should define admissibility criteria appropriate to the situation of bodies representing employees. However, if this were so it would be necessary to accept that any legitimate interest should give entitlement to bring an action for annulment, contrary to the provisions of On grounds of procedural economy, the the fourth paragraph of Article 173 of the Court of Justice ruled that there was no EC Treaty and the case-law of the Court of need to consider whether the other appli- Justice. Moreover, the Court could not cants were entitled to bring proceedings. 34 accept merely ruling on a case-by-case basis without seeking a degree of abstraction in the reasoning, with the attendant risk of 32 — Point 98. 33 — Paragraphs 29 and 30. depriving judicial decisions of the necessary 34 — Paragraph 31. predictability.

31.1 think that this is how the two relevant judgments in Perrier and Vittel, cited 'I take the view that, in the first place, this shows a close connection with the exam- 35 — Point 90. ination of the protective aim peculiar to the 36 —Or, as A. Saggio explains, op. cit. p. 902: this individual competition rule of which the procedural consideration is apparent from the fact that during the guarantees are the expression. In addition, decision-making process leading up to the adoption of the measure the specific situation of a particular person was this protection under the applicable provi- taken into account so that the measure was to an extent shaped according t o t h e specific requirements of that sions must be effectuated precisely through person'.

I - 3673

OPINION OF MR RUIZ-JARABO — CASE C-106/98 P

above, delivered by the Court of First employees among the third parties who are Instance in 1995 should be interpreted. sufficiently concerned to be heard by the Although they were delivered in a different Commission is sufficient therefore to single legal context, that of control of concentra- them out in relation to any other third tions, they provide criteria which are useful party without the need for them to estab- in the present analysis. lish for the purposes of assessing the admissibility of the action whether, at least prima facie, the concentration is likely to conflict with the social objectives of the Treaty. 38

In both cases it was a matter of ascertaining whether the recognised representatives of the employees of the undertaking which was taken over were entitled to challenge a Commission decision concerning the com- The Court of First Instance concludes by patibility of the take-over in question with stating, correctly, that the locus standi of the common market. third parties who have sufficient interest in bringing proceedings is not necessarily dependent upon their participation in the administrative procedure. Such participa- tion would at most imply a presumption in favour of the admissibility of the action. 39

I - 3674

COMITÉ D'ENTREPRISE DE LA SOCIÉTÉ FRANÇAISE DU PRODUCTION AND OTHERS V COMMISSION

express provision of the Treaty or of situation of the employees, their interests secondary legislation, are thereby distin- and, more generally, any social considera- guished from any other person whose legal tions. situation might be affected by the decision concerned. They may therefore, under the fourth paragraph of Article 173 of the EC Treaty, seek review by the Community judicature not only in order to establish that their procedural rights have been 34. In those circumstances, the Court of observed but also that the decision adopted First Instance acted in accordance with the following that procedure is not vitiated by law when it concluded that, in the absence any manifest error of assessment or misuse of any significant effect on a competitive of powers. 40 position or of any infringement of the entitlement which they have as parties concerned within the meaning of Arti- cle 93(2) of the Treaty to submit their comments during the procedure before the Commission, the applicants cannot claim any prejudice such as to demonstrate that their legal position is significantly affected by the contested decision, and they cannot therefore be regarded as being individually concerned for the purposes of the fourth paragraph of Article 173 of the EC Treaty. 42

36. I shall begin by restating the arguments of the Court of First Instance and summar- ising very briefly the main arguments of the parties. I shall not fail to point out to the Court of Justice, however, that if it con- The Court of First Instance goes on to say siders, as I do, that the applicants cannot in that, even in the absence of the contested this case claim to be directly concerned by Decision, the employees would not be the decision which they seek to challenge it protected by any guarantee against loss of will not be necessary, in the interest of jobs or benefits, which shows that there is procedural economy, to analyse also whe- no direct link between the contested Deci- ther the conditions for direct prejudice are sion and the alleged damaged to the met. 43 interests of those employees.

38. In their appeal to the Court of Justice in the collective wage agreement are to be the applicants maintain that the margin for retained, the Commission states that the negotiation which the undertaking and the contested decision does not require them to employers and employees have exists as be withdrawn. regards any measure of an economic nat- ure. Undertakings competing with another undertaking which is in receipt of aid may also react by reducing their production costs, for example, without that having any effect on the fact that they are directly concerned. As regards the collective wage agreement and the possibility of terminat- ing it, the applicants state that under French law only rights acquired individu- 40. For my part, I take the view that the ally may be retained, and then only for one conclusion which the Court of First year. Instance reached on the plea, that the applicants are directly concerned, is in accordance with the law. It is not inap- propriate to point out once again that the Treaty generally prohibits any State aid which distorts or threatens to distort com- petition by favouring certain undertakings The applicants therefore consider that the or the production of certain goods. Under Court of First Instance committed an error Article 93(2) of the EC Treaty the Com- in law in considering that the contested mission is competent, when it has found decision does not impose any conditions that aid is incompatible with the common directly prejudicing the interests of the market, to decide that the State concerned employees. must abolish or alter it within a specified period of time. This power to alter or abolish, in order to have legal effect, may include an obligation to require repayment of aid granted in breach of the Treaty. 4 5

common market and ordered the French 4 1 . In those circumstances it seems unne- Government to recover it from SFP, toge- cessary to analyse in detail each of the ther with the relevant interest. The legal alleged consequences, since it is clear that effects of the contested decision are limited the applicants have not demonstrated, or to those terms. The Commission did not even adduced any appropriate evidence, require any staff reduction or the with- that the Commission directly affects the drawal of social benefits from the under- interests of the employees. The loss of jobs taking's employees, nor was it empowered or the renegotiation of the collective wage to require such measures. The Commission agreement are dictated in some cases not as merely established, in accordance with the a result of the Commission's decision but as guidelines to which it had itself decided to a consequence of the undertaking's position use to govern its action, 4 6 that the condi- in a competitive market. It must therefore tions required in order to apply the exemp- be said, to paraphrase the terms of the tion contained in Article 92(3)(c) of the EC Alean judgment, 4 7 that the annulment of Treaty concerning aid which may be the contested decision 'cannot confer on the granted to undertakings in difficulty were applicants the benefits which they seek', in not met and, in particular, that no restruc- that authorisation of the aid in the absence turing plan had been drawn up which of a restructuring plan would not dispel the would enable the State's financial contribu- risk of the loss of jobs and social benefits. tion to be removed from the category of operating aid. The other observations con- tained in the decision (concerning, for example, the need to abolish the collective wage agreement or to seek new partners) do not therefore constitute additional obli- gations on the person to whom the decision is addressed, since the Commission, as has been said, does not have any powers in this respect. They are more akin to economic recommendations and have no legal effect. Even if they were able to contribute to the formation of the Commission's wishes, those observations come within the wide margin of discretion which the Commission must be allowed in connection with the monitoring of State aid. 42. The Court of First Instance therefore interpreted the fourth paragraph of Arti- cle 173 correctly when it held that 'a decision declaring aid to be incompatible with the common market and ordering its recovery cannot, in itself, result in the alleged effects on the level and conditions of employment in the undertaking in receipt of the aid at issue'. 48

I - 3679