Court of Justice of the European Communities (including Court of First Instance Decisions)

Law

'1. Before a common organisation of the market in bananas was established, the consumption of bananas in the Member States was supplied from three sources: bananas produced in the Community (in particular, in the Canary Islands and the French Overseas Departments), representing approximately 20% of Community consumption (hereinafter Community bananas); bananas produced in some of the States with which the Community hadconcluded the Lomé Convention (in particular, certain African States and certain Caribbean Islands), representing approximately 20% of Community consumption (hereinafter ACP bananas); and bananas produced in other States (principally certain Central and South American countries, representing approximately 60% of Community consumption (hereinafter third country bananas).

2 By virtue of the Protocol annexed to the Implementing Convention on the Association of the Overseas Countries and Territories with the Community, provided for in Article 136 of the EC Treaty (hereinafter the Banana Protocol), Germany enjoyed a special arrangement allowing it to import an annual quota of bananas free of customs duties, determined by reference to the quantities imported in 1956. That base quota was to be progressively reduced as the realisation of the common market progressed.

'12 The applicants are traders whose business consists in importing third country bananas into the Community. The first and second applicants are part of the Atlanta Group: the first is a holding company, the second is a subsidiary of the first. The first applicant, which is the only one concerned by the claim for damages in this action (see paragraphs 16 and 28 below), states that another of its subsidiaries, Atlanta Handels- und Schiffahrts-Gesellschaft mbH, responsible for organising transport by freezer ships, has suffered damage as a result of the entry into force of Regulation No 404/93. Atlanta Handels- und Schiffahrts-Gesellschaft mbH had chartered three vessels which it then made available to an American company. That company terminated the contract prematurely on the ground that the vessels would no longer be needed because of the import restrictions on bananas ensuing from Regulation No 404/93. Atlanta Handels- und Schiffahrts-Gesellschaft mbH, which must continue to pay the agreed charter hire to the shipowner, has assigned its rights in damages vis-à-vis the Community to its parent company, the first applicant.

Procedure prior to the appeal

'13 By application lodged at the Registry of the Court of Justice on 14 May 1993, the applicants applied for an order under the second paragraph of Article 173 of the EEC Treaty (now the fourth paragraph of Article 173 of the EC Treaty, hereinafter the Treaty), annulling Regulation No 404/93 in part and for an order under Article 178 and the second paragraph of Article 215 of the Treaty, requiring the European Community to pay compensation for damage suffered by the first applicant or, as the case may be, by Atlanta Handels- und Schiffahrts-Gesellschaft mbH. It is the second part of this application,originally registered under number C-286/93, then under number T-521/93 (see paragraph 21 below), which is dealt with in this judgment.

14 By application lodged at the Registry of the Court of Justice on the same day, the Federal Republic of Germany sought the annulment pursuant to the first paragraph of Article 173 of the Treaty, of Title IV and Article 21(2) of Regulation No 404/93 (Case C-280/93).

15 On 4 June 1993 the applicants also lodged at the Registry of the Court of Justice an application for interim measures pursuant to Articles 185 and 186 of the Treaty seeking suspension of operation of Title IV of Regulation No 404/93, in particular Articles 17 to 20 thereof and the ordering of any other measure which the President of the Court or the Court considered to be appropriate (Case C-286/93 R).

16 By order of 21 June 1993, the Court of Justice dismissed the applicants' application as inadmissible in so far as they sought annulment of certain provisions of Regulation No 404/93 but allowed the claim for an order requiring the European Community to make good the damage caused by the adoption of that regulation to continue. It also reserved costs (Case C-286/93, now Case T-521/93 - the present action).

17 By documents lodged at the Registry of the Court of Justice on 28 June 1993 and 12 July 1993, the United Kingdom of Great Britain and Northern Ireland and the French Republic respectively sought leave to intervene in this case in support of the defendants.

18 By order of 6 July 1993, the Court of Justice dismissed as inadmissible the application for interim measures lodged by the applicants and reserved costs (Case C-286/93 R).

19 By documents lodged at the Registry of the Court of Justice between 29 June 1993 and 12 July 1993, the Republic of the Ivory Coast, the company Terres Rouges Consultant, the company España et fils and the company Cobana Import sought leave to intervene in this case in support of the defendants.

20 By order of 15 July 1993, the Court of Justice decided to suspend proceedings in the present case pursuant to Article 82a(1)(b) of the Rules of Procedure of the Court of Justice until the proceedings in Case C-280/93 were concluded.

21 Following the entry into force on 1 August 1993 of Council Decision 93/350/Euratom, ECSC, EEC, amending Council Decision 88/591/ECSC, EEC, Euratom establishing a Court of First Instance of the European Communities (OJ 1993 L 144, p. 21), this case was referred to the Court of First Instance by order of the Court of Justice of 27 September 1993.

22 On 5 October 1994 the Court of Justice dismissed the action for annulment brought by the Federal Republic of Germany (Case C-280/93 Germany v Council [1994] ECR I-4973). Following that judgment, the suspension of proceedings was lifted and the written procedure in the present case was resumed.

23 By orders of the President of the Second Chamber, Extended Composition, of the Court of First Instance of 9 March 1995, the French Republic and the United Kingdom were granted leave to intervene in support of the defendants.

24 By order of 14 July 1995, the President of the Second Chamber, Extended Composition, of the Court of First Instance dismissed the applications to intervene lodged by the Republic of the Ivory Coast, the company Terres Rouges Consultant, the company España et fils and the company Cobana Import and ordered those applicants for leave to intervene to support the costs relating to their applications.

25 By order of 1 December 1993, received at the Court of Justice on 14 December 1993, the Verwaltungsgericht Frankfurt am Main referred to the Court of Justice for a preliminary ruling under Article 177 of the Treaty two questions on the validity of Title IV and Article 21(2) of Regulation No 404/93. Those questions had been raised in proceedings between Atlanta Fruchthandelsgesellschaft mbH and 17 other companies in the Atlanta group and the Bundesamt für Ernährung und Forstwirtschaft (Federal Office of Food and Forestry) concerning the allocation of import quotas for third country bananas.

26 On 9 November 1995, the Court of Justice, in answer to the questions referred to it by the Verwaltungsgericht Frankfurt am Main, ruled that consideration of Title IV and Article 21(2) of Regulation No 404/93, in the light of the grounds of the order for reference, had disclosed no factor of such a kind as to affect their validity (Case C-466/93 Atlanta Fruchthandelsgesellschaft (II) v Bundesamt für Ernährung und Forstwirtschaft [1995] ECR I-3799).

27 Between 8 December 1994 and 6 January 1995, in response to a request from this Court, the parties submitted their observations on the question as to whether the judgment in Case C-280/93 Germanyv Council had any consequences for this proceeding. Between 4 and 16 January 1996, in response to a request from this Court, the parties submitted their observations on the question as to whether the judgment in Case C-466/93 Atlanta Fruchthandelsgesellschaft (II) v Bundesamt für Ernährung und Forstwirtschaft had any consequences for this proceeding.

The contested judgment

'39 Both Article 42(2) of the Rules of Procedure of the Court of Justice, before which the action was first brought, and Article 48(2) of the Rules of Procedure of this Court provide that no new plea in law maybe introduced in the course of the proceedings unless it is based on matters of law or of fact which come to light in the course of the procedure. It is settled case-law that a judgment of the Court of Justice confirming the validity of an act of the Community institutions cannot be regarded as a factor allowing a new legal ground to be introduced, since such acts are presumed to be valid and the judgments in Case C-280/93 Germany v Council and Case C-466/93 Atlanta Fruchthandelsgesellschaft merely confirmed the law as known to the applicants at the time when they brought their action (see Case 11/81 Dürbeck v Commission [1982] ECR 1251, paragraph 17).

40 In the present case, as the applicants have raised no matter justifying the introduction of a new plea as to the Council's liability for a lawful act, the Court finds that this plea is out of time and therefore inadmissible.

'46 It is settled case-law that the principle of non-discrimination is one of the fundamental principles of Community law (see Case C-280/93 Germany v Council, paragraph 67). This principle requires that comparable situations should not be treated in a different manner unless the difference in treatment is objectively justified. As was found in Case C-280/93 Germany v Council, the situations of the categories of traders amongst whom the tariff quota was divided were not comparable before Regulation No 404/93 was adopted. Those categories of traders were also affected differently by the measures adopted and the Court of Justice specifically recognised that traders who had traditionally been supplied by third country bananas would now find their import possibilities restricted. However, the Court considered that such a difference in treatment appeared to be inherent in the objective of integrating previously compartmentalised markets and in providing a guarantee of disposal of Community production and traditional ACP production (paragraph 74). The Court also found that the machinery for dividing the tariff quota among the various categories of traders was intended to encourage traders in Community and traditional ACP bananas to obtain supplies of third country bananas and to encourage importers of third country bananas to distribute Community and ACP bananas (paragraph 83). It thus recognised that Regulation No 404/93 was not intended to establish identical treatment between the various categories of traders.

47 The Court also found that it was necessary for Regulation No 404/93 to restrict the volume of imports of third country bananas into theCommunity in connection with the introduction of a common organisation of the market (paragraph 82).

48 Finally, the Court held that it had not been demonstrated that the Council adopted measures which were manifestly inappropriate for achieving the objective pursued by Regulation No 404/93 (paragraph 95).

49 It should be added that in Case C-466/93 Atlanta Fruchthandelsgesellschaft the Court of Justice held that the difficulties in applying Regulation No 404/93 to which the applicants had referred could not affect the validity of the regulation (paragraph 11). Similarly, the consequences in practice of the adoption of Regulation No 404/93 to which the applicants refer cannot be taken into consideration by this Court in this case, since it must examine the question of the legality of Regulation No 404/93 only in the light of the pleas advanced by the applicants.

50 The Court therefore finds that the applicants have not proved that the defendant institutions failed to observe the principle of non-discrimination. This plea must therefore be dismissed as unfounded.

'70 Contrary to the applicants' argument, the right to be heard in an administrative procedure affecting a specific person cannot be transposed to the context of a legislative process leading to the adoption of general laws. The judgment in CB and Europay v Commission, cited above, followed a line of settled authority in competition law, according to which undertakings suspected of having infringed rules of the Treaty must be heard before any measures, and particularly sanctions, are taken against them. However, that case-law must be considered in its proper context and should not be extended to the context of a Community legislative process culminating in the enactment of legislation involving a choice of economic policy and applying to the generality of the traders concerned.

71 In the context of a procedure for the adoption of a Community act based on an article of the Treaty, the only obligations of consultation incumbent on the Community legislature are those laid down in the article in question. In its judgment in Case 138/79 Roquette Frères v Council [1980] ECR 3333, the Court of Justice held that the obligation to consult the Parliament, as laid down in various places in the Treaty, reflects at Community level the fundamental democratic principle that the people should take part in the exercise of power through the intermediary of a representative assembly.

72 Representation of the various groups of economic and social life also takes place in the Community's legislative process in the form of consultation of the Economic and Social Committee. In the present action, both the Parliament and that committee were in fact consulted before Regulation No 404/93 was adopted, as provided for in the Treaty.

73 The Court considers that, contrary to the thesis advanced by the applicants, the Commission was under no further obligation to consult the various categories of traders concerned by the Community market in bananas. It is quite feasible for the Community legislature to take into consideration the particular situation of distinct categories oftraders without hearing them all individually. The Court recalls in this regard that in Case C-280/93 Germany v Council the Court of Justice held that the applicant had not shown that the Council had adopted manifestly inappropriate measures or that it had carried out a manifestly erroneous assessment of the information available to it at the time when the regulation was adopted (paragraph 95). Since Regulation No 404/93 contains provisions concerning traders marketing third country bananas, it follows that the Court of Justice implicitly recognised that the Community legislature had not failed to take into consideration the interests of this category of traders.

74 It follows from the foregoing considerations that the plea of breach of the rights of the defence must be dismissed.

'83 According to settled case-law, in order for the Community to incur non-contractual liability under the second paragraph of Article 215 of the Treaty and for the right to compensation to be enforceable, a number of conditions must be satisfied: the conduct alleged against the institutions must be unlawful, actual damage must have been suffered and there must be a causal link between that conduct and the damage alleged. Furthermore, in the case of legislative measures involving choices of economic policy, the Community can incur liability only if a sufficiently serious breach of a superior rule of law for the protection of individuals has occurred. In a legislative context such as this, the Community can incur liability only if the institution concerned has manifestly and gravely disregarded the limits on the exercise of its powers (Joined Cases C-104/89 and C-37/80 Mulder v Council and Commission, cited above, paragraph 12).

84 It follows from all the foregoing that no illegality such as would impose non-contractual liability on the Community can be found against the defendant parties. Consequently, the action must be dismissed, and it is not necessary to decide whether the other conditions under which the Community incurs liability are satisfied.

The appeal

The first plea

The second plea

The third plea

The fourth plea

The fifth plea

The sixth plea

The seventh plea

The action for damages

Costs