C-364/98

Government of Aruba, represented by P. V. F. Bos and M. M. Slotboom, of the Rotterdam Bar, with an address for service in Luxembourg at the Chambers of M. Loesch, 11 Rue Goethe,

intervener at first instance,

APPEAL against the order of the President of the Court of First Instance of the European Communities of 14 August 1998 in Case T-44/98 R Emesa Sugar v Com- mission [1998] ECR II-3079, seeking to have that order set aside, judgment in the terms sought in the application at first instance or, alternatively, referral of the case back to the Court of First Instance for a fresh decision, and an order for costs against the Commission,

* Language of the case: Dutch.

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ORDER OF 17. 12. 1998 — CASE C-364/98 P(R)

and

French Republic,

interveners at first instance,

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EMESA SUGAR v COMMISSION

THE PRESIDENT OF THE COURT OF JUSTICE,

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ORDER OF 17. 12. 1998 — CASE C-364/98 P(R)

Legal background, facts and procedure

4 The legal background and the facts underlying the dispute are set out in the con­ tested order as follows:

'1 The island of Aruba is one of the overseas countries and territories ( 'OCT ") associated with the Community. The association of the OCT with the Com­ munity is regulated by Part Four of the EC Treaty and by Council Decision 91/482/EEC of 25 July 1991 on the association of the overseas countries and territories with the European Economic Community (OJ 1991 L 263, p. 1, " OCT decision"), adopted pursuant to the second paragraph of Article 136 of the Treaty.

2 Article 133(1) of the Treaty provides that customs duties on imports into the Member States of goods originating in the OCT are to be completely abolished in accordance with the provisions of the Treaty.

5 Article 108(1), first indent, of the OCT decision refers to Annex II thereof ("Annex II") for the definition of the concept of originating products and the methods of administrative cooperation relating thereto.

6 Under Article 1 of Annex II, a product is considered to originate in the OCT, the Community or the African, Caribbean and Pacific States ("ACP States") if it has been either wholly obtained or sufficiently worked or processed there.

7 Article 6(2) of the same annex provides that, when products wholly obtained in the Community or in the ACP States undergo working or processing in the OCT, they are to be considered as having been wholly obtained in the OCT. Under this rule, known as " ACP / OCT cumulation of origin", sugar origi­ nating in the ACP States which had undergone some degree of working or processing in the OCT could be imported into the Community free of customs duties.

8 Article 240(1) of the OCT decision states that the decision is to apply for a period of ten years from 1 March 1990. However, Article 240(3)(a) and (b) provides that before the end of the first five years the Council, acting unani­ mously on a proposal from the Commission, is, in addition to the financial assistance from the Community for the second five-year period, to establish, where necessary, any amendments to the OCT decision following notification to the Commission by the relevant authorities of the OCT or proposed by the Commission in the light of its own experience or as a result of amendments under negotiation between the Community and the ACP States.

"... fresh disruption should be avoided by taking measures to create a frame­ work conducive to regular trade flows and at the same time compatible with the common agricultural policy".

13 For that purpose, Decision 97/803 inserted Articles 108a and 108b in the OCT decision, allowing the ACP / OCT cumulation of origin for rice and sugar respectively, for a specified annual quantity.

14 Accordingly Article 108b(1) and (2) of the OCT decision reads as follows:

" 1 . The ACP / OCT cumulation of origin referred to in Article 6 of Annex II shall be allowed for an annual quantity of 3 000 tonnes of sugar ....

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Without prejudice to Articles 108a and 108b, the Community shall not apply to imports of products originating in the OCTs any quantitative restriction or measure having equivalent effect."

16 On 17 December 1997 the Commission adopted Regulation (EC) No 2553/97 on rules for issuing import licences for certain products covered by CN codes 1701, 1702, 1703 and 1704 and qualifying as ACP / OCT originating products (OJ 1997 L 349, p. 26, "the implementing regulation"). Although this regula­ tion entered into force on 19 December 1997, it did not take effect until 1 January 1998.

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17 Transitional arrangements were laid down by Article 8(3) of the said regula­ tion which provides:

"Import licences applied for between 10 and 31 December 1997 shall be issued by the competent authorities of the Member States, after prior authorisation has been granted by the Commission departments, in the order in which the applications are submitted and for quantities not exceeding the total maximum of 3 000 tonnes for the Community."

EMESA SUGAR v COMMISSION

inadmissible on the ground that it related to a quantity greater than the maximum specified by Article 8(3) of the implementing regulation.'

5 By application lodged at the Registry of the Court of First Instance on 10 March 1998, the appellant brought an action for the partial annulment of the contested decision.

6 By separate document lodged at the Registry of the Court of First Instance on 10 April 1998, the appellant also initiated proceedings under Article 185 of the EC Treaty for suspension of the operation of the contested decision until the Court of First Instance had given judgment on the substance of the case, and under Article 186 of the Treaty for interim measures prohibiting the Commission from applying, during the same period, the provisions of the implementing regulation and/or Article 108b of the OCT decision in so far as those provisions have the effect of limiting imports into the Community of sugar from the OCT.

The contested order

7 By the contested order the President of the Court of First Instance, after examining the condition of urgency, dismissed the application for interim measures.

12 With regard to the economic survival of the undertaking, in paragraph 78 of the contested order the judge stated that neither in the documents in the file nor in the 'numerous documents submitted scarcely one week before the hearing — which were rejected as no reason was given for their belated submission' had the appel­ lant provided sufficient information on its assets and liabilities and on its profit­ ability. In paragraph 80 the judge concluded that the applicant had not discharged the burden, which fell upon it, of proving that it was threatened with insolvency.

13 In paragraphs 81 to 83 the judge added that in any event the forced dissolution of the company and the forced realisation of its assets could only lead to additional damage of a purely financial nature because the operation of the contested decision

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had already led to the temporary cessation of trading and the closure of the under­ taking resulting in the technical redundancy of its employees, so that even the threat of insolvency, assuming it to be established, could not justify suspension of the operation of the decision.

1 4 As regards the risk of an irreversible change in market share, according to paragraph 84 of the contested order the appellant had put forward nothing to suggest that, if the contested decision were annulled, the appellant would be unable to find new outlets in the Community and to recover its market share there.

17 According to the appellant, the procedure at first instance was vitiated by serious defects which infringed the principle of the proper administration of justice, the principle of fair trial and the principle of inter partes proceedings. Those defects also constitute, in the applicant's submission, an infringement of Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms and are so serious that they provide sufficient grounds for setting aside the contested order.

18 In the first plea, the appellant contends that the parties granted leave to intervene in the proceedings were not given an opportunity to set out in writing the pleas on which they based their claims, whereas in the orders granting leave to intervene to the Council, the Kingdom of Spain and the French Republic, the President of the Court of First Instance stated that they would be allowed a period in which to make their written submissions. According to the appellant, this omission was incompatible with its interests because it risked being caught unawares by the inter­ veners' arguments at the hearing.

19 In the second plea, the appellant claims that, unlike what occurred with regard to the applications to intervene in support of the form of order sought by the Com­ mission no decision was given before the oral procedure on the application to inter­ vene submitted by the Government of Aruba, and the President did not order a period to be prescribed for the submission of its written observations. Such unequal treatment was unacceptable and it kept the Government of Aruba out of the pro­ ceedings not only in the legal sense, but also in practical terms because it was unable to lodge a written statement or explain its position at the hearing, during which no questions were put to it.

Pleas on substantive grounds

22 The fifth plea in the appeal relates to paragraphs 63 to 66 of the contested order in which, '[F]or the purpose of determining the requirements concerning evidence in the present case' (paragraph 63), the President of the Court of First Instance exam­ ined the aims pursued by Decision 97/803 and the power vested in the Council in that regard. The appellant submits, first, that the requirements concerning evidence of urgency cannot vary according to the aims pursued by the contested act or according to the consequences of granting interim relief. The President was there­ fore mistaken in measuring by the yardstick of the Community interest and the

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aims pursued by the Community the requirements which the appellant had to sat­ isfy in the matter of evidence of urgency.

23 The appellant also challenges the accuracy of the observations in paragraphs 64 and 65 of the contested order concerning the sugar market and OCT sugar imports into the Community. In support of its submissions, the appellant sets out in detail the reasons for which it considers that it is incorrect to say that OCT sugar imports lead to an increase in expenditure in terms of export refunds, that they affect the Community's obligations arising from Schedule CXL to the General Agreement on Tariffs and Trade (GATT) and from the World Trade Organisation (WTO) and that they disrupt the Community sugar market.

26 In the seventh plea the appellant contends that the President of the Court of First Instance wrongly, and in legal terms incomprehensibly, characterised the alleged damage as financial damage which could in principle be quantified and be made good later, adding that purely financial damage could not be regarded as irreparable. According to the appellant, this is an incorrect legal assessment of the facts. Fur­ thermore, the case-law based on the possibility of compensation for damage under Article 215 of the EC Treaty disregards the difference between the criteria gov­ erning the Community's financial liability and those governing the annulment of a contested Community measure. A breach of Community law entailing the annul­ ment of a measure or a ruling that it is unlawful does not always constitute a serious breach of Community law giving rise to a right to the compensation which the second paragraph of Article 215 of the Treaty enables to be granted.

27 According to the eighth plea, it is incorrectly stated in paragraph 76 of the contested order that the appellant merely stated that the implementation of the contested deci­ sion and that of Decision 97/803 and the implementing regulation had led to imme­ diate cessation of trading and the complete closure of its undertaking.

28 The appellant then contends, in its ninth plea, that it is incorrectly stated in para­ graphs 78 and 80 of the contested order, on the basis of an assessment of evidence the production of which was not accepted, that the appellant had not shown that it was threatened with insolvency. Referring to its pleas on procedural grounds, the appellant maintains that the evidence was assessed in a legally incorrect manner. Furthermore, according to the appellant, in a case such as its own it would appear to be essentially pointless to produce economic or accounting data because the undertaking concerned has been compelled by the contested measures to cease trading altogether for the time being. The parties are in agreement on this.

Pleas on procedural grounds

31 The Council begins by affirming, without disputing the reference to Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms, that, although everyone has a right to a fair trial, this does not mean that the Com­ munity courts have no autonomy in procedural matters.

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32 With regard to the first plea, the Council states that, in the field of the procedure for interim relief, there are numerous precedents where the other parties had no opportunity to submit written observations, a fact which is explained by the urgency which characterises that procedure. The Commission points out that the parties were invited to attend the hearing and therefore had an opportunity to make oral observations. According to the Commission, although no action was taken on the orders allowing the interventions, in that they prescribed a period for lodging a statement in intervention, this was not, having regard to the circumstances, a pro­ cedural irregularity. The Kingdom of Spain adds that the purpose of its interven­ tion was to defend the validity of Decision 97/803 and was therefore not relevant to the issue of urgency.

33 With regard to the application by the Government of Aruba for leave to intervene, which is the subject of the second plea, the Council and the Kingdom of Spain observe that the different treatment of the Government of Aruba arises from the fact that it was not one of the interveners referred to by the first paragraph of Article 37 of the EC Statute of the Court of Justice. They also point out that the Government of Aruba attended the hearing, during which it was treated in the same way as the other parties. Finally, the Commission stresses that Article 116(1) of the Rules of Procedure of the Court of First Instance does not lay down a time-limit within which the President must decide on an application to intervene.

37 The Council and the Commission, for their part, first deal jointly with the fifth and sixth pleas. According to the Council, the requirement of undeniable urgency where the measure at issue is adopted on the basis of a power of assessment is affirmed by settled case-law. On this point, the Council refers to the order of the Court of First Instance in Case T-310/97 R Government of the Netherlands Antilles v Council [1998] ECR II-455, paragraph 65, and the order of Court of Justice in Case C-110/97 R Netherhnds v Council [1997] ECR I-1795, paragraphs 32 and 33, also cited by the Commission. The latter institution also argues that the connection made between the existence of a power of assessment and the degree of urgency cannot be regarded as wrong in law. It would perhaps be more correct to say that this reasoning goes to the question of the balancing of interests, but in the final analysis that amounts to the same thing and means that, for measures based on a power of assessment, the President must maintain a certain caution.

38 According to the Council, the seventh plea, which relates to the purely financial nature of the damage, is manifestly inadmissible because it concerns the finding of the facts by the President of the Court of First Instance.

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39 With regard to the eighth plea, the Council and the Commission agree that the finding in paragraph 76 of the contested order accurately reflects the essential aspects of the appellant's position.

40 The ninth plea, which, according to the Commission, constitutes the essential issue in these proceedings, is inadmissible, in the submission of that institution, for the same reasons as the tenth and eleventh pleas because it challenges grounds of the contested decision given merely for the sake of completeness or relates to findings of fact.

to be given in the main action (order in Case C-149/95 P(R) Commission v Atlantic Container Line and Others [1995] ECR I-2165, paragraph 22).

44 In the context of that overall examination , the judge hearing the application has a wide discretion and is free to determine , having regard to the specific circumstances of the case, the manner and order in which those various conditions are to be exam­ ined, there being no rule of Community law imposing a pre-established scheme of analysis within which the need to order interim measures must be analysed and assessed (order in Commission v Atlantic Container Line and Others, cited above, paragraph 23).

45 In the present case, only the condition relating to urgency was examined and the parties' arguments concerning the prima facie justification of the application are not mentioned in the order. Having found in paragraph 85 of the contested order that the applicant had not shown that it risked suffering serious and irreparable damage and, in paragraph 86, that therefore the requirement of urgency was not satisfied, the President of the Court of First Instance, in paragraph 87, dismissed the applica­ tion for interim measures without examining the other pleas and arguments put forward by the appellant to justify suspension of the operation of the contested decision.

46 For the purpose of determining the requirements concerning evidence of urgency, the President of the Court of First Instance, after examining, in paragraphs 64 and 65, the aims of Decision 97/803, concluded in paragraph 66 that 'the Council, in adopting Decision 97/803, exercised its discretion with regard to the choice of the most appropriate measure for preventing disruption of the Community market for sugar'. According to paragraph 67 of the contested order, it followed that the appel­ lant's request could be granted only if the urgency of the measures sought appeared undeniable.

51 The approach taken in the contested order would amount to excluding, or, at least, reducing considerably, the effectiveness of interim judicial protection where a mea­ sure adopted in the exercise of a broad power of assessment is concerned. In par­ ticular, it may lead, solely on the ground that urgency is not undeniable, to the refusal of interim measures which might appear necessary in order to ensure the effectiveness of the judgment in the main action in situations where there is a par­ ticularly strong prima facie case and where the balance of interests inclines in favour of the party seeking the measure.

52 The objections of the Council and the Commission to the admissibility of the ninth and eleventh pleas must be examined in the light of these considerations.

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53 In this connection, it is true, as the Council and the Commission point out, that an appeal must be limited to points of law, and may not call into question the findings of fact by the judge hearing the application for interim relief (order in Commission v Atlantic Container Line and Others, cited above, paragraph 18). Moreover the Court of Justice does not as a rule have jurisdiction to examine evidence which the Court of First Instance has accepted in support of its findings or its assessments of the facts (order in Case C-159/98 P(R) Netherlands Antilles v Council [1998] ECR I-4147, paragraph 68).

54 However, in the present case the error of law in the contested order is, in so far as it entails a requirement of undeniable urgency, such as to affect the conclusion reached by the judge hearing the application in his assessment of the serious and irreparable nature of the damage claimed by the applicant. ·

59 Under the first paragraph of Article 54 of the EC Statute of the Court of Justice, if the appeal is well founded, the Court is to set aside the decision of the Court of First Instance. It may itself give final judgment in the matter, where the state of the proceedings so permits, or refer the case back to the Court of First Instance for judgment.

60 The state of the present proceedings does not permit judgment to be given. The case must therefore be referred back to the Court of First Instance for judgment.

On those grounds,

THE PRESIDENT OF THE COURT

hereby orders:

1. The order of the President of the Court of First Instance of 14 August 1998 in Case T-44/98 R Emesa Sugar v Commission is set aside.

Registrar President

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