C-151/98

PHAROS V COMMISSION

OPINION OF ADVOCATE GENERAL MISCHO delivered on 20 May 1999 *

1. The appeal of which this Court has been inafter 'MRL'). Article 1(1 )(b) of the Reg- seised by Pharos SA (hereinafter 'Pharos') ulation defines the limit as the maximum seeks the annulment of the judgment of the concentration of residue resulting from the Court of First Instance of 17 February use of a veterinary medicinal product 1998 1 (hereinafter 'the contested judg- which may be accepted by the community ment') in so far as it dismissed the claim to be legally permitted or recognised as for damages brought by Pharos against the acceptable 'in or on a food'. Commission under Article 235 EC (for- merly Article 178) and the second para- graph of Article 288 EC (formerly the second paragraph of Article 215). Pharos claims that the Commission, in breach of its obligations, failed to pursue the proce- 3. Regulation No 2377/90 makes provision dure for including somatosalm produced by for four annexes in which a pharmacologi- the appellant in the list of substances not cally active substance intended for use in subject to maximum residue levels in veterinary medicines to be administered to Annex II to Council Regulation (EEC) 'food-producing animals' may be included: No 2377/90 of 26 June 1990 laying down a Community procedure for the establish- ment of maximum residue limits of veter- inary medicinal products in foodstuffs of animal origin. 2 — Annex I, reserved for substances for which an MRL may be established following assessment of the risks which the substance presents for human health;

'Within 120 days of referral of the applica- — Annex IV, reserved for substances for tion to the [CVMP], and having regard to which an MRL cannot be established the observations formulated by the mem- because such substances constitute a bers of the Committee, the Commission threat to consumer health in any shall prepare a draft of the measures to be amount. taken. If the information submitted by the person responsible for marketing is insuffi- cient to enable such a draft to be prepared, that person will be requested to provide the Committee with additional information for examination ....'

4. Under Article 6(1) of Regulation No 2377/90, in order to obtain the inclu- sion in Annex I, II, or III of a new pharmacologically active substance, the 7. Under Article 6(5), within a further 60 person responsible for marketing the pro- days the Commission is to submit the draft duct concerned is to submit an application measures to the Committee for the Adapta- to the Commission containing certain tion to Technical Progress of the Directives information and particulars. on Veterinary Medicinal Products (herein- after 'the Adaptation Committee').

8. Under Article 8(2) the Adaptation Com- 5. According to Article 6(2), after verifying mittee is to deliver its opinion on the draft within a period of 30 days that the measures within a time-limit set by its application is submitted in the correct chairman, having regard to the urgency of form, the Commission is forthwith to the matter. It is to act by a qualified submit the application for examination by majority, the votes of the Member States

13. Having verified that the application (c) If, after a period of three months of the had been submitted in the correct form, the proposal being referred to it, the Commission referred the application for Council has not acted, the proposed measures shall be adopted by the Commission, unless the Council has 4 — As stated by the Court in the contested judgment.

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examination to the CVMP, pursuant to on Bovine Somatotropin (hereinafter Article 6(2) of Regulation No 2377/90. 'BST'), imposed by Council Decision 90/218/EEC of 25 April 1990 concerning the administration of Bovine Somatotropin (BST), 5as last amended by Council Deci- sion 94/936/EC of 20 December 1994, 6 would be undermined indirectly if somato- salm, which is also a somatotropin, were 14. By letter of 13 April 1995 it informed included in one of the annexes to Regula- Pharos that the CVMP had recommended tion No 2377/90. Moreover, six Member that somatosalm be included in Annex II. It States abstained from the vote in question. added that the draft measures to be taken, drawn up on the basis of the CVMP's proposal, would be sent to the Adaptation Committee for adoption, in accordance with Article 8 of Regulation No 2377/90.

18. On 6 March 1996, Pharos sent a registered letter to the Commission, for- 15. By letter of 31 August 1995 it informed mally calling upon it to act by taking 'the the appellant that it had referred a draft necessary steps, in accordance with Arti- regulation including somatosalm in cle 175 of the Treaty, to ensure that the Annex II to the Adaptation Committee, procedure for including somatosalm in but that, at its meeting, the Committee Annex II is completed as soon as possible.' had deleted somatosalm from the draft.

21. By letter of 27 June 1996 the CVMP stated in reply to the request for a further opinion that, following a specific study, it The contested judgment had concluded that the risk that somato- salm might be abused to boost growth could be considered to be non-existent.

25. By the contested judgment the Court of First ruled that there was no need to adjudicate on the application for a declara- 22. On 25 September 1996, following that tion of failure to act, the subject-matter of reply, the Commission sent the Council a the application for a declaration of failure new proposal for a regulation including to act having ceased to exist since, on somatosalm in Annex II. 25 September 1996, the Commission sub- mitted to the Council a proposal for a regulation including somatsalm in Annex II. The appeal does not relate to that part of the contested judgment. 23. The Council did not act on that pro- posal within the period of three months provided for by Article 8(3)(c) of the Reg- ulation.

26. With regard to the claim for damages, the Court ruled that the Commission was not in breach of either the principle of legal 24. On 8 July 1996 Pharos lodged an certainty or the principle of the protection application at the Registry of the Court of of legitimate expectations. The following

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are the relevant paragraphs of the contested perfectly foreseeable and that precise judgment: assurances were given to the applicant with regard to that period.

66 Accordingly, it cannot be inferred from 70 Moreover, as the Commission has the relevant rules that the period within rightly observed, it was as a result of which the Commission had to act was the further opinion it obtained that it

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was able to dispel all doubt regarding in no way disclosed any mismanagement of the question whether somatosalm the matter on its part. could be used to boost growth. In those circumstances, the Commission greatly facilitated the work of the Council, which, having noted the fur- ther opinion of the CVMP, did not oppose the inclusion of somatosalm in Annex II. The appeal

28. Pharos submits that the findings of the Court of First Instance in respect of the 71 In the result, through asking for a claim for damages contain errors of law and that the contested judgment should further opinion on 23 April 1996, only accordingly be annulled. In essence, it relies six months elapsed after 16 October on two pleas alleging misinterpretation, 1995, the date on which the Adapta- first, of Article 8(3)(b) of Regulation tion Committee failed to give its assent No 2377/90, which provides that the Com- to the measures proposed by the Com- mission shall 'without delay' propose to the mission, without the Commission tak- Council the measures to be adopted, and, ing any decision. second, of the Regulation itself, since it does not confer on the Commission the right to seek a further opinion from the CVMP.

72 Under those circumstances, the Com- mission was not in breach, and a fortiori did not commit a sufficiently clear breach, of either the principle of The alleged misinterpretation of Arti- legal certainty or that of the protection cle 8(3)(b) of Regulation 2377/90 of legitimate expectations.'

30. In its view, this interpretation is in any case confirmed by the general structure of 33. In the alternative, the appellant submits Regulation No 2377/90 which is designed that, even if it were necessary to accord the to lay down and ensure a rapid procedure Commission 'a certain margin for man- for the establishment of MRLs of veterin- oeuvre', it must, nevertheless, be declared ary medicinal products in foodstuffs of that the expression 'without delay' indi- animal origin. For new pharmacologically- cates a short time, to say the least, and that active substances Article 6 provides a fixed a period of 11 months clearly does not time limit, of between 30 and 120 days, for correspond to that idea. In holding that the each stage in the procedure for the estab- Commission had met the requirement to lishment of MRLs. act swiftly when it had remained inactive for six months and not adopted the mea- sure it was required to take until 11 months had elapsed, the contested judgment was not properly reasoned. 31. The right of the inventor of a new substance to a decision within a short time is demonstrated a contrario by the greater flexibility provided in Article 7 with regard to the establishment of MRLs for sub- stances already authorised for use on the 34. La Fédération européenne de la santé date on which Regulation No 2377/90 animale (European Federation of Animal entered into force. Article 7 provides that Health) (hereinafter 'Fedesa'), intervening the Commission is to publish a timetable for the consideration of these substances in support of the forms of order sought by and that the period allowed for examina- Pharos, argues that, although one of the tion by the CVMP is to be 120 days, this two stages comprising the procedure for the period being renewable. establishment of MRLs, namely the scien- tific stage, may take quite a long time, it is a different matter for the stage at which the MRLs are adopted. This is apparent from the tenth recital in the preamble to Regula- tion No 2377/90 which states: 'after scien- 32. Pharos considers that it was therefore tific assessment by the Committee for entitled to expect the Commission, in Veterinary Medicinal Products, maximum

36. With regard to the appellant's argu- — Assessment of the merits of the plea ment concerning Article 7 of Regulation No 2377/90, the Commission points out that the article is not designed to uphold the rights of traders or to introduce provi- sional authorisation rules. Article 7 esta- blishes, for substances already on the mar- ket, a procedure similar to the one provided for new substances by Article 6. Having imposed the obligation to determine a 38. I, for my part, think that, with regard Community MRL for every substance, the to this plea, a ruling should be given only in legislature could hardly apply this require- respect of the six-month period during ment to all the medicinal products already which the Commission claims that it on the market without spreading out the reconsidered the matter, that is to say, the work to be done and establishing a transi- period between 16 October 1995, the date tional period. 8The timetable mentioned in on which the Adaptation Committee failed Article 7(2) of Regulation No 2377/90 is to adopt the measures proposed, and 23 April 1996, the date on which the Commission decided to request the further 7 — See Council Decision 87/373/EEC of 13 July 1987 laying opinion (hereinafter 'the six-month per- down the procedures for the exercise of implementing iod'). The legality of the request is the powers conferred on the Commission (OJ 1987 L 197, p. 33). subject of the second plea in the appeal and 8 — See Article 14 of Regulation No 2377/90. a ruling on the additional extension of the

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42. It must be borne in mind that the 40. Moreover, even though it is not the Adaptation Committee procedure amounts decisive argument, the wording of the

10 — In French: '... soumet ... une proposition ... ' (emphasis 9 — Emphasis added. added).

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to a delegation of powers from the Council the same as that reached by the Court of to the Commission, and that the Council First Instance, 12 namely that 'it cannot be recovers its full legislative jurisdiction the inferred from the relevant rules that the moment a proposal is presented to it. period within which the Commission had to act was perfectly foreseeable and that precise 13 assurances were given to the applicant with regard to that period.'

43. Consequently, the Council may even adopt different measures from those pro- posed by the Commission provided, of course, that it observes the rule of unani- mity established in Article 250 EC (for- 46. Furthermore, the margin for manœuvre or period for reflection afforded to the merly Article 189 A). Indeed, Arti- Commission must also be evaluated in the cle 8(3)(c) of Regulation No 2377/90 pro- light of the complexity of the matter in vides: question and particularly, as in this case, in relation to the reasons which caused assent to be withheld.

52. The appellant refers to the procedure established in Articles 6 and 8 of Regula- 49. Finally, Pharos has not presented us tion No 2377/90, pointing out that, at the with any evidence to show that the six- end of the procedure, if the Adaptation month period of reconsideration was dis- Committee gives an unfavourable opinion proportionate to the complexity of the or no opinion at all, jurisdiction is trans- matter. ferred to the Council. Indeed, in such cases, the Commission has no alternative but to submit the draft to the Council. The Council then has a period of three months in which to adopt the proposed measures by a qualified majority. If it does not do so, 50. Under those circumstances the Court jurisdiction to adopt the proposed mea- was right to rule, on this point, that the sures will revert to the Commission, unless Commission was not in breach, and a the Council has voted against them by a fortiori did not commit a sufficiently clear simple majority. breach, of either the principle of legal certainty or that of the protection of legitimate expectations. It is also clear from the above considerations 15 that the alter- native submission that no grounds or insufficient grounds were stated for the contested judgment cannot be upheld. 53. The procedure is clear, precise and unconditional; it examines all possible situations exhaustively and leaves the Com- mission no latitude to act otherwise than as laid down by Regulation No 2377/90.

51. The first plea should therefore be rejected as unfounded.

14 — Case T-120/96 Lilly Industries v Commission [1998] ECR II-2571. 54. According to the appellant, the fact 15 — See paragraphs 46 and 47 above. that, as the Court pointed out, the further

57. The Commission maintains that it decided to consult the CVMP again in order to dispel all doubt regarding a possible breach of Article 15 of Regulation No 2377/90 with respect to the morator- 55. Fedesa points out that the Court relies ium on BST and, consequently, to facilitate on the moratorium on BST to justify the the work of the Council, very probably Commission's decision to seek a further ensuring that the Council did not reject the opinion. However, the Court also acknowl- draft regulation by a simple majority. edges, in paragraph 83 of the judgment in Lilly Industries v Commission, that, where the CVMP, having all the necessary infor- mation at its disposal, has given a favour- able opinion on a request for the inclusion of a substance in Annex II, the Commission is under an obligation to draw up a draft 58. The Commission points out that four regulation including that substance in Member States on the Adaptation Com- Annex II and to submit it to the Adaptation mittee objected to the inclusion of somato- Committee for approval. salm in one of the Annexes to Regulation No 2377/90 on the basis of the morator- ium on BST. Therefore the assent by a qualified majority was not received. Fur- thermore, six Member States abstained from voting without giving reasons other than, apparently, their wish to reserve their 56. The sole objective of Regulation freedom of manœuvre for the discussions in No 2377/90 is to protect public health, the Council. The effect of the CVMP's and this can be achieved only by carrying further opinion was, therefore, to prevent out a scientific assessment of the matter. those Member States which had abstained

60. Finally, with regard to the arguments put forward by Fedesa, the Commission 62. Indeed, there are fundamental differ- points out that it was certain Member ences between the situations leading to the States, not the Commission, which raised two judgments. In the case of Lilly Indus- the issue of the risk that somatosalm could tries v Commission, the Commission, after be used to boost growth. As this situation receiving the opinion of the CVMP, did not might have prevented the adoption of the prepare a draft regulation including the draft concerned, it became necessary to ask relevant substance in one of the annexes to the CVMP for a further opinion. In the Regulation No 2377/90 with a view to circumstances, the Moskof judgment was submitting it to the Adaptation Committee relevant inasmuch as it authorised the but, instead, rejected the request for inclu- Commission to find a solution which sion on the basis of the moratorium on BST. However, in the present case, the Commission certainly did not reject a 18 — Case C-244/95 [1997] ECR I-6441, paragraphs 38 to 40. request for inclusion but asked the CVMP

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for a further opinion on the basis of has the right to ask the CVMP for a further scientific, not political or socio-economic, opinion. However, as I have already said, 19 considerations in order, in particular, to nor does it require the Commission to facilitate the subsequent work of the Coun- submit to the Council the same measures as cil. The Commission did not, therefore, it submitted to the Adaptation Committee. cause 'the undertakings to lose the legal certainty which the Regulation (Regulation No 2377/90) is supposed to afford them'.

65. Admittedly, the article does not expressly provide that the Commission 19 — See point 42 of this Opinion.

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nevertheless held that the Commission was 69. It is true that, as the Court held in Lilly entitled to delay the adoption of the act for Industries v Commission, 20 where the six months in order to try to find a CVMP has given a favourable opinion on compromise acceptable to the two delega- a request for the inclusion of a substance in tions which had refused to approve the Annex II, the Commission is under an initial version. The consequence of this was obligation to draw up a draft regulation that the Regulation had retroactive effect. including that substance in Annex II and to A fortiori, when only five delegations have submit it to the Adaptation Committee for voted in favour for the proposal, four have approval. However, in this case we are at a voted against it and six have abstained, later stage of the procedure laid down by preferring to reserve their freedom of Regulation No 2377/90, namely the point manœuvre for the discussions in the Coun- at which the Adaptation Committee has cil, the Commission must be entitled to issued its opinion on the proposal to look for ways of achieving, in the Council, include the substance at issue in Annex II. a qualified majority in favour of the At this stage, if the Adaptation Committee proposal at issue. It sought the opinion of has not given a favourable opinion, the the experts on the CVMP in order to Commission has, as I have already said, a support its proposal with scientific, con- certain margin for manœuvre, at least with clusive and indisputable arguments. regard to the period within which a draft must be submitted to the Council and, I believe, also with regard to the content of the proposal itself.

— order Pharos SA to pay the costs.

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