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

JUDGMENT OF THE EUROPEAN UNION CIVIL SERVICE TRIBUNAL (Third Chamber)

25 September 2014 (*)

(Civil service - Remuneration - Staff of the EEAS assigned to a third country - Decision of the appointing authority amending the list of third countries in respect of which the living conditions are equivalent to those normally obtaining in the European Union - Measure of general application - Admissibility of the action - Annual assessment of the allowance for living conditions - Abolition)

In Case F-100/13,

ACTION brought under Article 270 TFEU, applicable to the EAEC Treaty pursuant to Article 106a thereof,

Bruno Julien-Malvy, official of the European External Action Service, residing in Tokyo (Japan), and the other applicants whose names are set out in the annex, represented by T. Bontinck and A. Guillerme, lawyers,

applicants,

v

European External Action Service (EEAS), represented by S. Marquardt and M. Silva, acting as Agents,

defendant,

THE CIVIL SERVICE TRIBUNAL (Third Chamber)

composed of S. Van Raepenbusch (Rapporteur), President, E. Perillo and J. Svenningsen, Judges,

Registrar: P. Cullen, Administrator,

having regard to the written procedure and further to the hearing on 12 May 2014,

gives the following

Judgment

1        By application lodged at the Registry of the Tribunal on 4 October 2013, Mr Julien-Malvy and the other applicants whose names are set out in the annex request that the Tribunal annul the decision of 19 December 2012 of the European External Action Service (EEAS) in so far as it abolishes, from 1 January 2014, payment of the allowance for living conditions (‘the ALC’) to staff employed in Argentina, Hong Kong, Chile, Japan, Malaysia, Singapore and Taiwan and, consequently, order the payment of sums which they consider to be due to them in respect of the ALC. 

 Legal context

2        Council Decision 2010/427/EU of 26 July 2010 establishing the organisation and functioning of the European External Action Service (OJ 2010 L 201, p. 30) provides, in Article 1 thereof, that the EEAS ‘shall be a functionally autonomous body of the European Union, separate from the General Secretariat of the Council [of the European Union] and from the [European] Commission with the legal capacity necessary to perform its tasks and attain its objectives’. Pursuant to Article 6 of the Staff Regulations of Officials of the European Union, in the version applicable to the dispute (‘the Staff Regulations’), prior to the entry into force of Regulation (EU, Euratom) No 1023/2013 of the European Parliament and of the Council of 22 October 2013 amending the Staff Regulations of Officials of the European Union and the Conditions of Employment of Other Servants of the European Union (OJ 2013 L 287, p. 15), those Staff Regulations and the Conditions of Employment of Other Servants apply to the staff of the EEAS.

3        Article 1b of the Staff Regulations provides, inter alia, that, ‘[s]ave as otherwise provided in these Staff Regulations, [the EEAS] shall, for the purposes of these Staff Regulations, be treated as [an] institution … of the Union’.

4        Article 110(1) of the Staff Regulations stipulates that ‘[t]he general provisions for giving effect to these Staff Regulations shall be adopted by each institution after consulting its Staff Committee and the Staff Regulations Committee’. In accordance with Article 110(3), the general implementing provisions referred to in Article 110(1) (‘the GIP’) ‘shall be brought to the attention of the staff’.

5        Chapter 1 of Annex X to the Staff Regulations, on special and exceptional provisions applicable to officials serving in a third country, is entitled ‘General Provisions’. Article 1 thereof provides as follows:

‘This Annex lays down the special and exceptional provisions applicable to officials of the European Union serving in a third country.

Only nationals of Member States of the Union may be recruited to serve in such a country, the appointing authority not being permitted to invoke the exception provided for in Article 28(a) of the Staff Regulations.

General implementing provisions shall be adopted in accordance with Article 110 of the Staff Regulations.’

6        Article 10(1) of Annex X to the Staff Regulations provides as follows:

‘An [ALC] shall be fixed, according to the official’s place of employment, as a percentage of a reference amount. …

Where an official is employed in a country in which living conditions can be deemed equivalent to those normally obtaining in the European Union, no such allowance shall be payable.

In the case of other places of employment, the [ALC] shall be fixed as follows.

The parameters taken into account for fixing the [ALC] shall be the following:

-        health and hospital environment,

-        security,

-        climate,

to which three parameters shall be applied a weighting of 1:

-        degree of isolation,

-        other local conditions,

to which two parameters shall be applied a weighting of 0,5.

Each parameter shall have the following value:

0:       where conditions are normal but not equivalent to those normally obtaining in the Union,

2:       where conditions are difficult compared with those normally obtaining in the Union,

4:       where conditions are very difficult compared with those normally obtaining in the Union.

…

The [ALC] fixed for each place of employment shall be reviewed and, where appropriate, adjusted each year by the appointing authority after the opinion of the Staff Committee has been obtained.

…’

7        Article 1 of the Decision of the High Representative of the Union for Foreign Affairs and Security Policy of 17 December 2013 on the ALC and the additional allowance referred to in Article 10 of Annex X to the Staff Regulations, in the version following from Regulation No 1023/2013 (‘the Internal Directives’), provides as follows:

‘The parameters set out in Article 10(1) of Annex X to the Staff Regulations shall be assessed by the appointing authority, using, for example, information provided by reliable public or private international sources, by the Member States, or by the Union delegations and the departments of the institutions and bodies of the European Union.’

8        Article 2 of the Internal Directives provides:

‘After consulting the EEAS and Commission Staff Committees, the appointing authority shall determine the percentages of the [ALC] for the different places of employment. …

Where an official is employed in a country in which living conditions can be deemed equivalent to those normally obtaining in the European Union, no such allowance shall be payable. …

Equivalence shall be determined by the appointing authority on the basis of a comparison of the level of development of the third countries concerned and their comparative ranking in the classification system of the U[nited] N[ations] (living conditions allowance), the [United Nations Development Programme] (human development index), the [International Monetary Fund] (per capita GDP), the [Organisation for Economic Co-operation and Development] (Better Life Index) and, if necessary, other information obtained from reliable international public or private sources.

 Factual background to the dispute

9        On 19 December 2012, the Chief Operating Officer of the EEAS, acting in his capacity as the appointing authority (‘the appointing authority’) adopted a decision under Article 10 of Annex X to the Staff Regulations adjusting the amount of the ALC paid to staff assigned to third countries. That decision, inter alia, updates the list of third countries in respect of which the living conditions are deemed equivalent to those normally obtaining in the European Union (‘the list’) and consequently abolishes the payment of the ALC to staff who are, specifically, like the applicants, employed in Argentina, Hong Kong, Chile, Japan, Malaysia, Singapore and Taiwan, fixing the date at which that abolition took effect at 1 January 2014.

10      The applicants brought complaints on 12, 15, 17 and 18 March 2013 against the abovementioned decision in so far as it abolishes the ALC for staff assigned to the respective countries where they are employed (‘the complaints’).

11      The appointing authority rejected the complaints by decisions of 26 June 2013 and 2 July 2013.

 Procedure and forms of order sought

12      The applicants claim that the Tribunal should:

-        annul the decision of the Chief Operating Officer of the EEAS of 19 December 2012 in so far as it abolishes the ALC for staff employed in Argentina, Hong Kong, Chile, Japan, Malaysia, Singapore and Taiwan (‘the contested decision’);

-        order, consequently, the payment of the ALC at the rate of 15% from 1 January 2014;

-        order the EEAS to pay the costs.

13      The EEAS contends that the Tribunal should:

-        dismiss the action;

-        make an order as to costs.

 Law

 Admissibility of the action

14      Officials and other members of staff are entitled to bring an action against a measure of a general nature adopted by the appointing authority which adversely affects them in so far as, first, that measure does not, in order to produce legal effects, require any implementing measure or leave any discretion, as regards its application, to the authorities responsible for implementing it and, secondly, it affects officials’ interests directly by bringing about a distinct change in their legal position (see, to that effect, in respect of the appointing authority’s omission to verify that elections to the Staff Committee were properly conducted, judgment in De Dapper and Others v Parliament, 54/75, EU:C:1976:127; as regards a decision on the electoral regime for a Staff Committee, judgment in Diezler and Others v ESC, 146/85 and 431/85, EU:C:1987:457, paragraphs 6 and 7; as regards a decision of the appointing authority amending the method for calculating the salary differential due to officials who, following a competition, are appointed to a higher grade, judgment in Brown v Court of Justice, 125/87, EU:C:1988:136, paragraph 16).

15      In the present case, the contested decision, which was taken by the appointing authority pursuant to Article 10 of Annex X to the Staff Regulations, results, for the members of staff assigned to the delegations and offices of the European Union in Argentina, Hong Kong, Chile, Japan, Malaysia, Singapore and Taiwan, in the abolition of the ALC from 1 January 2014. The contested decision thus seems to be sufficiently precise and unconditional to produce legal effects for the members of staff posted in the third countries concerned.

16      Admittedly, the implementation of the contested decision requires the adoption of administrative measures, of individual application, to end the grant of the ALC which was, until then, paid to members of staff employed in the abovementioned third countries, including the applicants. However, the adoption of such intermediate measures, which does not leave the managing authorities any discretion, is not such as to prevent the applicants’ legal position from being directly affected, and they must necessarily expect to lose entitlement to the ALC from 1 January 2014.

17      It follows from the foregoing that the action is admissible.

 The claims for annulment

18      The applicants raise six pleas, alleging, respectively, (i) infringement of the third paragraph of Article 1 of Annex X to the Staff Regulations and the principles of legal certainty and transparency, (ii) infringement of the obligation to state reasons, (iii) infringement of Article 10(1) of Annex X to the Staff Regulations, manifest error of assessment and infringement of the principle of proportionality, (iv) misuse of powers and of procedure, (v) error of law and error of facts, and (vi) finally, infringement of the principle of the protection of legitimate expectations.

 The first plea, alleging infringement of the third paragraph of Article 1 of Annex X to the Staff Regulations and of the principles of legal certainty and transparency

19      The applicants claim, in essence, that the EEAS was required, pursuant to the third paragraph of Article 1 of Annex X to the Staff Regulations, according to which ‘[GIP] shall be adopted in accordance with Article 110 of the Staff Regulations’, to adopt GIP for Article 10 of that annex in order to confer on the contested decision a ‘clear and sufficiently foreseeable’ legal basis. In the absence of such GIP, the contested decision is in breach of the principles of legal certainty and of transparency.

20      The EEAS contends that the plea should be rejected. It submits that the obligation to adopt GIP laid down by Article 1 of Annex X to the Staff Regulations does not, in the absence of express provisions to this effect, concern all the provisions of that annex, including, in particular, Article 10. In addition, that article is, in any event, sufficiently clear and precise to avoid any risk of it being applied arbitrarily.

21      In that regard, according to case-law, the GIP for the purposes of Article 110 of the Staff Regulations are, primarily, the implementing measures expressly provided for by certain special provisions of the Staff Regulations, and, in the absence of any express provision, the obligation to adopt implementing measures subject to the formal requirements of that article can be recognised only in exceptional circumstances, that is, when the provisions of the Staff Regulations are so unclear and imprecise that any application of them must be arbitrary (judgment in Behmer v Parliament, F-47/07, EU:F:2009:103, paragraph 47).

22      In the present case, while Article 10 of Annex X to the Staff Regulations, which, as has been stated previously, is the legal basis for the contested decision, does not contain any express stipulation providing for the adoption of GIP in accordance with Article 110 of the Staff Regulations, by contrast, the third paragraph of Article 1 of Annex X to the Staff Regulations, which falls within Chapter 1 of that annex, on ‘General Provisions’, does expressly set out such an obligation. The discharge of that obligation cannot be restricted to the implementation of Article 1 of Annex X to the Staff Regulations. The first paragraph of that article merely states the purpose of Annex X to the Staff Regulations, that is ‘[to] lay… down the special and exceptional provisions applicable to officials of the European Union serving in a third country’. As regards the second paragraph of Article 1 of Annex X to the Staff Regulations, under which ‘[o]nly nationals of Member States of the Union may be recruited to serve in such a country, the appointing authority not being permitted to invoke the exception provided for in Article 28(a) of the Staff Regulations’, this is an imperative and unconditional provision which does not require any specific implementing measure to be put into effect.

23      Thus, the third paragraph of Article 1 of Annex X to the Staff Regulations is of general application and the GIP whose adoption it provides for concern the whole of Annex X to the Staff Regulations, including the provisions governing the grant of the ALC. 

24      That the third paragraph of Article 1 of Annex X to the Staff Regulations is of general application cannot be called into question by the fact that Article 3 of that annex, which is also part of Chapter 1 thereof concerning ‘General Provisions’, provides that officials previously assigned to a third country and reassigned temporarily to the seat of the EEAS or any other place of employment in the Union may remain subject to certain provisions of Annex X to the Staff Regulations ‘on the basis of [GIP]’ adopted by the appointing authority. It must be observed that the provision in question, contained in Article 3 of Annex X to the Staff Regulations, is expressly set out ‘[b]y way of derogation from the first paragraph of Article 1’ of that annex.

25      Consequently, the GIP to which Article 3 of Annex X to the Staff Regulations refers, and which concern the situation of officials reassigned temporarily within the European Union, cannot be applicable to the ‘special and exceptional provisions applicable to officials … serving in a third country’ mentioned in the first paragraph of Article 1 of Annex X to the Staff Regulations, or thereby refer to the GIP provided for by the third paragraph of that Article 1. Accordingly, by providing in Article 3 of Annex X to the Staff Regulations for the obligation to adopt GIP in the cases identified in that article, the EU legislature cannot have intended to restrict the scope of the obligation to adopt GIP on the basis of the third paragraph of Article 1 of Annex X solely to Article 3 thereof.

26      The EEAS also observes that, as regards the right for the institution to recover sums paid to a probationary official in the event that the person concerned is not established as an official, Article 22 of Annex X to the Staff Regulations provides for the obligation to adopt provisions ‘laid down by the appointing authority’ for its implementation, without specifying the nature of those provisions, that is to say, the EEAS further submits, without requiring the adoption of GIP. However, even if the EU legislature did not intend to oblige the appointing authority to adopt GIP for the implementation of Article 22 of Annex X to the Staff Regulations, which does not concern the ALC but the possibility of recovering certain sums in the event that a probationary official is not established, that circumstance cannot, in the absence of any express provision to this effect, exempt the appointing authority from adopting GIP for the implementation of Article 10 of Annex X to the Staff Regulations. Moreover, the reference to the ‘provisions laid down by the appointing authority’, in Article 22 of Annex X to the Staff Regulations, does not prevent those provisions taking the form of GIP for the purposes of Article 110 of the Staff Regulations.

27      Nor may it be concluded either from the fact, also raised by the EEAS, that certain provisions of Annex X to the Staff Regulations are so clear and precise that they do not require GIP, that the general rule set out in the third paragraph of Article 1 of Annex X to the Staff Regulations does not apply to the provisions of Article 10 of Annex X to the Staff Regulations. The present proceedings specifically demonstrate the difficulties in the interpretation of the second subparagraph of Article 10(1) of Annex X to the Staff Regulations, excluding officials from entitlement to the ALC where they are employed ‘in a country in which living conditions can be deemed equivalent to those normally obtaining in the Union’.

28      Lastly, the fact that the version of Article 10 of Annex X to the Staff Regulations as amended by Regulation No 1023/2013, in force since 1 January 2014, states that ‘[d]etailed provisions for the application of this [a]rticle shall be decided by the appointing authority’, without referring to the GIP mentioned in Article 110 of the Staff Regulations, does not show, a posteriori, the legislature’s supposed intention, when it adopted the initial version of that article applicable to the proceedings in October 1987, not to make obligatory the adoption of GIP for the implementation of that article. In addition, the version of Article 1 of Annex X to the Staff Regulations, as amended by Regulation No 1023/2013, is identical to that applicable to the present proceedings and still provides for the obligation to adopt GIP. Moreover, the reference to ‘detailed provisions for the application of this [a]rticle’, made in the new version of Article 10 of Annex X to the Staff Regulations, does not in any way preclude those provisions from taking the form of GIP within the meaning of Article 110 of the Staff Regulations.

29      Having regard to all the foregoing, the EEAS was under an obligation to adopt GIP for Article 10 of Annex X to the Staff Regulations, in accordance with the third paragraph of Article 1 of that annex.

30      It is not apparent from the file that the EEAS, acting with regard to its staff as an institution within the meaning of the Staff Regulations, adopted GIP for the implementation of Article 10 of Annex X to the Staff Regulations in accordance with Article 110 of those regulations. The Internal Directives were adopted after the contested decision and therefore cannot be invoked effectively by the EEAS. In addition, those Internal Directives were taken without the Staff Regulations Committee having been consulted beforehand. They cannot therefore be considered to be GIP within the meaning of Article 110 of the Staff Regulations, since they were not adopted according to the procedure set out in that article. The same is indeed true of the Commission’s Internal Directives of 10 October 1987, on the ALC and the supplementary allowance to which Article 10 of Annex X to the Staff Regulations relates, which the EEAS indicated, at the hearing, it applied by analogy to its staff.

31      It must however be noted that the adoption of GIP pre-supposed that a Staff Committee had been put in place. In accordance with Article 99 of the Staff Regulations, the EEAS had until 31 December 2011 to establish such a committee among its workforce. In those circumstances, while the delay in the implementation of the third paragraph of Article 1 of Annex X to the Staff Regulations is regrettable, it must be conceded that at the date of the contested decision the EEAS was still, as regards the application of that provision, in a period of adjustment (see, to that effect, regarding the obligation to adopt GIP for the implementation of Articles 43 and 45 of the Staff Regulations, judgments in Bernusset v Commission, 94/63 and 96/63, EU:C:1964:41 and De Pascale v Commission, 97/63, EU:C:1964:61). Therefore the failure of the EEAS to fulfil its obligations cannot in itself be considered to render the contested decision invalid having regard, inter alia, to the needs of the service and, specifically, to the obligation on the appointing authority to assess the ALC annually in respect of each place of employment, in accordance with the seventh subparagraph of Article 10(1) of Annex X to the Staff Regulations.

32      In addition, it must be observed that the lack of GIP for Annex X to the Staff Regulations does not deprive of a legal basis the contested decision, which was adopted on the basis of Article 10(1) of that annex, and in particular of the second subparagraph thereof, according to which ‘[w]here an official is employed in a country in which living conditions can be deemed equivalent to those normally obtaining in the Union, no such allowance shall be payable’.

33      In any event, the applicants cannot usefully rely on the plea alleging the lack of GIP for Annex X to the Staff Regulations unless the alleged irregularity is liable to affect them personally (see, to that effect, Opinion of Advocate General Warner in Deboeck v Commission, 90/74, EU:C:1975:109). In that regard, it must be pointed out that the main purpose of GIP is to set appropriate criteria to guide the administration in the exercise of its discretion or to make clear the scope of provisions of the Staff Regulations which are so unclear and imprecise that any application of them must be arbitrary (see, to that effect, judgments in Ianniello v Commission, T-308/04, EU:T:2007:347, paragraph 38, and Behmer v Parliament, EU:F:2009:103, paragraph 47). In so far as the fact that a provision is imprecise is not sufficient in itself to lead to that provision being applied arbitrarily, the applicants have no legal interest in raising such a plea unless the failure by the EEAS to adopt GIP adversely affected them personally, leading the appointing authority, in the circumstances of the case, to apply the provisions of Article 10 of Annex X to the Staff Regulations to their situation in a biased and arbitrary manner.

34      As it is, the applicants have not adduced any evidence such as to prove that the lack of GIP led the appointing authority to apply Article 10 of Annex X to the Staff Regulations to them in an arbitrary manner. They merely assert, without any probative evidence in support of their claims, that the EEAS ‘arbitrarily consider[ed] … [that] living conditions [in the countries in which they were employed were equivalent]’ to those normally obtaining within the European Union and submit that they ‘do not have to prove that the provisions [in question] are unclear and imprecise’. In particular, the fact that the appointing authority did not use the parameters set out in the fourth subparagraph of Article 10(1) of Annex X to the Staff Regulations to determine the amount of the ALC for each place of employment is not sufficient to prove that the appointing authority ‘arbitrarily list[ed] the places of employment where living conditions can be deemed equivalent to those normally observed in the [European] Union’. It is indeed apparent from the file that, far from not having been ‘guided by [any] criteria’, the appointing authority fixed appropriate criteria to guide its assessment as to the equivalence of living conditions. The appointing authority thus, in the contested decision, described the method used, indicating that the annual procedure for review of the ALC included an analysis of the living conditions prevailing in the places of employment, seeking to ascertain whether they [were] or remain[ed] equivalent to those normally obtaining in the European Union, adding that, where appropriate, based on that review the appointing authority would decide that no [ALC should] be granted’, and specifying in addition that ‘it was necessary to take into account the analyses made by the competent departments of the European Union, the gradings of the United Nations “Hardship allowance” system and other information available to the departments’. The criteria used by the appointing authority were also mentioned both in the EEAS’s statement in defence and the replies to the applicants’ complaints, and it is not disputed that those criteria were taken into account in the assessment of the applicants’ individual situations. While the applicants assert that the method thus set out is insufficiently precise, they do not demonstrate in what way it is inadequate nor, in any event, that that lack of precision would have led the appointing authority to treat them arbitrarily in relation to staff members employed in other places.

35      In the alternative, the applicants submit that, should such GIP exist, the EEAS nevertheless infringed the principle of transparency by not bringing them to the knowledge of the members of staff and by not communicating them to the Staff Committee. However, in so far as it is not apparent from the file, as has been stated, that the hypothesis put forward by the applicants has been established, this argument must be rejected.

36      Lastly, the fact that the entry into force of Regulation No 1023/2013 renders such communication all the more necessary since the reference to the ‘weighting’ no longer appears in the version of Article 10 of Annex X to the Staff Regulations resulting from that regulation, has no impact on the legality of the contested decision, which was not issued under the regime established by that regulation.

37      Having regard to the foregoing, the lack of GIP for Annex X to the Staff Regulations does not lead to the invalidity of the contested decision and, consequently, the first plea must be rejected.

 The second plea, alleging an inadequate statement of grounds

38      The applicants claim that the contested decision is in breach of the obligation to state the grounds of decisions adversely affecting officials, as set out in Article 25 of the Staff Regulations. The contested decision was confined to addressing the need to update the list without providing any grounds or any explanation, in particular as regards the method followed, in support of the assertion that there was such a need. In particular, the mere reference, in an internal note and in the replies to the complaints, to the gradings used by the United Nations for its own staff, or the United Nations Development Programme index, or those used by the United States of America for its diplomatic staff, do not allow the methodology followed to be understood.

39      The EEAS contends that the plea should be rejected.

40      In this connection, according to settled case-law, the scope of the obligation to state grounds depends on the nature of the measure in question and where, as in the present case, the measure is of general application, the statement of grounds may be confined to indicating the general situation which led to its adoption, on the one hand, and the general objectives which it is intended to achieve, on the other (judgments in United Kingdom v Council, C-150/94, EU:C:1998:547, paragraphs 25 and 26; Luxembourg v Parliament and Council, C-168/98, EU:C:2000:598, paragraph 62; Kik v OHIM, C-361/01 P, EU:C:2003:434, paragraph 102, and Spain v Council, C-342/03, EU:C:2005:151, paragraph 55; see also, as regards regulations concerning the remuneration of officials, judgments in Abrias and Others v Commission, 3/83, EU:C:1985:283, paragraphs 30 and 31, and Rijnoudt and Hocken v Commission, T-97/92 and T-111/92, EU:T:1994:69, paragraph 49 et seq.).

41      Moreover, the European Union Courts have repeatedly held that if an act of general application clearly discloses the essential objective pursued by the institution, it would be excessive to require a specific statement of reasons for the various technical choices made (see, inter alia, judgment in Spain v Council, C-284/94, EU:C:1998:548, paragraph 30), such as, for example, the technical aspects of the procedure for calculating the remuneration of officials (judgment in Abello and Others v Commission, T-544/93 and T-566/93, EU:T:1995:202, paragraph 89).

42      Lastly, it is not necessary, irrespective of the nature of the measure at issue, for the reasoning to go into all the relevant facts and points of law, since the statement of grounds for an act must be assessed with regard not only to the wording of that act but also to its context and to all the legal rules governing the matter in question (judgment in Netherlands v Commission, C-26/00, EU:C:2005:450, paragraph 113 and the case-law cited).

43      In the present case, the statement of grounds for the contested decision concerns Article 10 of Annex X to the Staff Regulations. It points out that the review of the ALC is an annual procedure which covers all the places of employment in order to take account of the changes in circumstances. It states that the procedure includes an analysis of the living conditions prevailing in the places of employment, seeking to ascertain whether they are or remain equivalent to those normally obtaining in the European Union. It indicates that, where appropriate, on the basis of that review the appointing authority will decide that no ALC will be granted. It states that it will take account, inter alia, of the analyses made by the competent services of the European Union, the gradings of the United Nations ‘Hardship allowance’ system and the recommendations of the Technical Group of the EEAS of 5 and 19 October 2012 on the review of the ALC. It states, lastly, that the list must be updated by the addition of certain third countries which it sets out. The statement of grounds for the contested decision thus mentions both the general situation which led to its adoption and the general objectives which it is intended to achieve.

44      In addition, the contested decision was taken after the section of the central Staff Committee dealing with matters outside the European Union was consulted on its adoption. Although that section objected that it had not had access to certain databases and issued a negative opinion on the draft decision submitted to it, the fact remains that the contested decision was taken in a context about which the applicants were informed, and they knew of the opinion of that committee, thereby enabling them to understand the scope of the measure as it related to them.

45      It must also be noted that an internal note of the Human Resources directorate of the EEAS of 21 December 2012 was disseminated to all the members of staff assigned to delegations. That note stated, inter alia, that the contested decision was based on the second subparagraph of Article 10(1) of Annex X to the Staff Regulations, which, according to that note, ‘confers on the appointing authority broad discretion in setting the list…’. Furthermore, it stated that the appointing authority’s analysis was based on ‘a comparison of the living conditions in the countries in question’, on ‘the confirmation of a gradual improvement of the living conditions in the third countries in question’, on ‘a comparison with the gradings [of the UN] for [its] own members of staff and the gradings of the [UNDP and the human development index]’.

46      Lastly, the appointing authority developed the reasoning for the contested decisions in its replies to the complaints, in which it stated, inter alia, that the consequences of the economic crisis within the European Union had significantly contributed to bringing closer to the European standard of living the standard of living in the third countries which it had added to the list, some of which had experienced strong economic growth in the last few years. In its replies to the complaints, the appointing authority also took pains to answer the various factual arguments put forward by the applicants point by point, enabling them to assess the justification for the contested decision and the possibility of bringing an action before the Tribunal.

47      Accordingly, the Tribunal takes the view that, in accordance with the principles laid down in the case-law, the statement of grounds for the contested decision, although succinct, is adequate (see, to that effect, judgments in Di Marzio and Lebedef v Commission, T-98/92 and T-99/92, EU:T:1994:70, paragraphs 80 and 81, and Chassagne v Commission, F-43/05, EU:F:2007:14, paragraph 108).

48      That finding cannot be called into question by the fact that the Staff Committee was not able to gain access to the ‘reference documents’ or to certain ‘databases’ and to the ‘questionnaires’. Although the consultation of that committee is an obligation under the Staff Regulations, the applicants have neither established nor even claim that the transmission to the staff representatives of the documents to which they refer, which, however, they do not precisely identify, constitutes a prior formality to be carried out by the appointing authority in the procedure for the adoption of the contested decision (see, to that effect, judgment in Dalmasso v Commission, F-112/11, EU:F:2013:43, paragraph 29).

49      Having regard to all the foregoing, the second plea must be rejected.

 The third plea, alleging infringement of Article 10(1) of Annex X to the Staff Regulations, manifest error of assessment and infringement of the principle of proportionality

50      The third plea can be divided into three parts, alleging, first, error of law, second, manifest error of assessment and, third and lastly, infringement of the principle of proportionality

51      As regards, first of all, the first part of the third plea, the applicants claim that the appointing authority vitiated the contested decision by an error of law by not applying the five parameters listed in the fourth subparagraph of Article 10(1) of Annex 10 to the Staff Regulations when it drew up the list. The appointing authority simply drew up the list arbitrarily and took account of the parameters at issue only to determine the amount of ALC to pay in the other places of employment. The absence of criteria allows the appointing authority an overly broad discretion and is thus contrary to the principle of transparency. The references to ‘analyses made by the … departments of the European Union’, the ‘gradings of the UN Hardship Allowance system’ or to the UNDP system or the system of the United States of America are irrelevant for the purposes of establishing whether the living conditions are equivalent. The appointing authority should, rather, have taken account of the answers to the questionnaires on living conditions filled in by the delegations. Lastly, contrary to what it claims, it could have taken into account the system applied by the Member States for their own diplomatic staff posted abroad.

52      In that regard, Annex X to the Staff Regulations, on account of its specific nature and the fact that it is a derogation, must be interpreted strictly (order in Marcuccio v Commission, C-617/11 P, EU:C:2013:657, point 31).

53      Furthermore, although the fourth subparagraph of Article 10(1) of Annex X to the Staff Regulations exhaustively lists the parameters for the purpose of setting the value of the ALC to be paid in respect of countries of employment in which living conditions are not deemed equivalent to those normally obtaining in the European Union, the EU legislature did not, on the other hand, identify any criterion by which to establish the equivalence of living conditions between the countries of the European Union and third countries. Moreover, as was stated in paragraph 31 above, at the time of the contested decision the EEAS was in a period of adjustment which could validly explain why, at that date, there were still no GIP capable of guiding its discretion in the application of Article 10 of Annex X to the Staff Regulations.

54      However, it must be conceded that, by not fixing any criterion for the determination of whether living conditions in third countries were equivalent to those in the countries of the European Union and, the EU legislature intended to leave the appointing authority a wide discretion as regards the GIP which it was required to adopt in the future. Accordingly, the Tribunal takes the view that, at the date of the contested decision, the EEAS could, without committing any error of law and without exceeding its discretion, take account of criteria other than the parameters explicitly listed in the fourth subparagraph of Article 10(1) of Annex X to the Staff Regulations to assess that equivalence.

55      Consequently, the appointing authority, contrary to the applicants’ submission, was neither bound nor limited by the parameters mentioned in Article 10(1) of Annex X to the Staff Regulations for the purposes of assessing living conditions and determining whether those in third countries are equivalent to those in the countries of the European Union. Although the applicants also claim that the appointing authority should have taken account, in its assessment of the equivalence of living conditions, of the evaluations made by the Member States for their diplomatic staff, they do not adduce any legal evidence capable of establishing that those arguments are well founded. In those circumstances, having regard to the complexity of the subject and its own wide discretion, the appointing authority could, and did, take account of the indices and data on the level of economic development achieved by the countries at issue, and the evaluations made by certain international organisations or States, such as those made by the UN in the context of the UNDP for the purposes of determining the remuneration to be paid to its own staff, or those made by the United States of America for its diplomatic staff employed abroad.

56      In the light of the documents in the file, the use of that data and of the method thus described, which favours a general economic approach based on the comparison of levels of economic development and taking account of the analyses made by other international organisations or some States for their diplomatic staff, in order to determine whether living conditions in third countries are equivalent to those in the countries of the European Union, does not appear to be contrary to Article 10(1) of Annex X to the Staff Regulations.

57      That finding cannot be called into question by the contention, which, moreover, has not been proven, that the method used to determine whether living conditions were equivalent was different from that used in the past, since, as has just been stated, the method used fell within the limits of the appointing authority’s discretion and no rule obliged that authority to maintain its method unaltered.

58      Finally, to accept that, as the applicants suggest, the review of the equivalence of living conditions should be made according to the parameters and the method used to evaluate the amount of the ALC would lead to guaranteeing, from one year to the next, even where the living conditions were considered to be equivalent, payment to the staff members concerned of an ALC at a minimum rate of 10%, corresponding to the situation where all the parameters are evaluated at ‘0’. Such an approach would clearly be contrary to the intention of the EU legislature, which was to exclude from entitlement to the ALC staff assigned to third countries where living conditions were equivalent to the conditions normally obtaining in the European Union.

59      As regards, next, the second part of the third plea, alleging manifest error of assessment, it must first of all be recalled that it is settled case-law that, in fields where the EU legislature has a wide discretion, judicial review by the Tribunal must be limited to verifying that the measure in question is not vitiated by any manifest error or misuse of powers and that the authority concerned has not manifestly exceeded the limits of its discretion (see judgments in Jippes and Others, C-189/01, EU:C:2001:420, paragraph 80, and the case-law cited; Spain v Council, C-310/04, EU:C:2006:521, paragraph 96; Busacca and Others v Court of Auditors, T-164/97, EU:T:1998:233, paragraph 48, and Chassagne v Commission, EU:F:2007:14, paragraph 56).

60      Moreover, it is also settled case-law that an administrative measure is presumed to be lawful and the burden of proof lies, in principle, with the person claiming it to be unlawful, so that it is for the applicants to provide at the very least sufficiently precise, objective and consistent information to corroborate the truth or likelihood of the facts in support of their claim (judgment in Wiame v Commission, F-15/08, EU:F:2010:7, paragraph 21 and the case-law cited).

61      The evidence provided in respect of each country of employment by the applicants in support of the second part of the third plea, alleging a manifest error of assessment, must be examined in the light of the principles identified in the case-law referred to above.

62      The applicants essentially claim that there has been no improvement in the five parameters set out in Article 10 of Annex X to the Staff Regulations for determining the amount of the ALC during the reference period in the countries concerned and that, in the case of some of them, there has even been a deterioration. That is true of the climate, in particular in Japan, with an increased risk of earthquakes or hurricanes, in Malaysia, in Hong Kong or in Singapore with the worsening of atmospheric pollution, or in Argentina, where there is an increased risk of flooding. In that latter country, health conditions, having regard to the dengue fever epidemic, or those relating to security, having regard to the high level of criminality, have also markedly deteriorated. In support of their arguments the applicants adduce newspaper articles, articles from internet sites, studies of the World Health Organisation, in particular as regards the air quality in Hong Kong and Chile, and results from questionnaires put to the delegations. The applicants take the view that the appointing authority, by removing the two points it had granted the previous year in respect of climate in order, that year, to establish the ALC at 15% of the reference amount in Japan, Hong Kong, Chile, Taiwan, Malaysia and Singapore, and in removing the two points also granted the previous year in respect of security to establish the amount of the ALC in Argentina, committed a manifest error in its assessment of the living conditions in those third countries and therefore wrongly considered that they had become equivalent to those normally obtaining in the European Union.

63      The Tribunal takes the view however that such considerations have no impact on the outcome of the present case since, as has been stated, the appointing authority did not refer to the parameters set out in the fourth subparagraph of Article 10(1) of Annex X to the Staff Regulations as the basis of its assessment as to the equivalence of living conditions. Although, in its replies to the complaints, in particular the reply to the applicants employed in Malaysia, the appointing authority disputed the validity of the applicants’ arguments relating to the abovementioned parameters, it nevertheless cannot thereby, on any view, have substituted the grounds of the decision merely because it adopted a position as to the validity of those parameters: neither the appointing authority, in its responses to the complaints, nor the EEAS, in its submissions in defence in the present case, relied in any way on those parameters to assess the equivalence of living conditions between the European Union and third countries. Indeed, this is not contested by the applicants.

64      Even if, in its replies to the applicants’ arguments, the appointing authority committed errors of fact or a manifest error in assessing the weighting to be given to the abovementioned parameters in respect of the countries at issue, that fact has no bearing on the lawfulness of the contested decision. It is apparent, both from the replies to the complaints and the evidence adduced by the EEAS in the defence that the appointing authority based its assessment as to the equivalence of living conditions between the countries of the European Union and the third countries, essentially, as has been stated, on economic indices and data.

65      The appointing authority thus, in an initial stage, based its assessment on an evaluation of the level of development of the countries of employment concerned, both in absolute and in relative terms, on the basis of indicators such as the International Monetary Fund’s gross national product per person or the Organisation for Economic Co-operation and Development’s Better Life index.

66      The appointing authority pointed out that the analysis carried out in that initial stage showed that living conditions within the European Union had deteriorated due to the financial crisis and, in contrast, living conditions in the countries of employment concerned had improved to the point, sometimes, of being more favourable than those normally found in the European Union. Then, in the second stage, the appointing authority compared the results obtained with the statistics drawn up, inter alia, by the UN and the United States of America for their respective staff employed abroad in situations of hardship, taking the view that the UN and American systems were, in many respects, very close to that used by the European Union for its staff employed in the third countries. Lastly, the appointing authority completed its analysis by taking into account various international indices, in particular the UNDP human development index, which simultaneously measures life expectancy, the level of education and the standard of living.

67      To dispute such a method of assessment, the applicants merely, in essence, assert that the data used by the EEAS is ‘in some way irrelevant and inadequate’. They submit that, in the past, the EEAS did not ‘align [itself] with [the UN Hardship scheme or that of the United States of America]’ and ‘granted [ALCs] in instances where the UN did not’. They also refer to the conclusions of the ALC Technical Group according to which ‘the analysis of the UN [should] be used cautiously since “the UN base their notation on the overall country while the [Commission] bases [its analysis] on the situation in the capitals”’. Such arguments, which are not specific, are not, however, sufficient to establish that the appointing authority vitiated by a manifest error its assessment as to the equivalence of the living conditions. Lastly, although the applicants claim in their application that the Staff Committee noted that Japan and Taiwan are not evaluated in the ‘UN [Hardship] scheme’, they do not prove this.

68      In the light of the documents in the file, having regard to the appointing authority’s wide discretion in this matter and whereas the applicants have not adduced any evidence such as to call into question the method used for assessing the equivalence of living conditions, the Tribunal considers that consideration of the negative impact of the cumulative consequences of the financial crisis on living conditions within the European Union since 2008 and of the concurrent improvement of socio-economic indicators over the last few years in the countries of employment could well have led the appointing authority, in reliance on a comparative analysis of the results obtained by other large international statistical systems, to take the view that the living conditions in the third countries concerned had become equivalent to those normally obtaining in the European Union, without committing a manifest error in its assessment in this regard.

69      As regards, lastly, the third part of the third plea, the applicants submit that the contested decision infringes the principle of proportionality, the disadvantages caused being, having regard to the real situations in the countries in question, disproportionate in relation to the objectives pursued. The consequences of the contested decision are particularly serious as regards the lower grades and for officials and staff members with significant family expenses. In support of that part of the plea, the applicants seem to be claiming that Article 10 of Annex X to the Staff Regulations provides, even where all the parameters are evaluated at zero, an ALC of 10% of the reference amount. Such an argument cannot, in any event, be upheld, since Article 10 of Annex X to the Staff Regulations provides for the assessment of a parameter at zero where ‘conditions are normal but not equivalent to those normally obtaining in the Union’, and consequently applies only to situations in which the living conditions are considered to be normal and not equivalent to those normally obtaining in the European Union.

70      That said, the principle of proportionality requires measures adopted by EU institutions not to exceed the limits of what is appropriate and necessary in order to attain the objective pursued (see judgment in National Farmers Union and Others, C-157/96, EU:C:1998:191, paragraph 60, et Verein für Konsumenteninformation v Commission, T-2/03, EU:T:2005:125, point 99).

71      In the present case, the contested decision was adopted, in accordance with Article 10 of Annex X to the Staff Regulations, in the context of the annual procedure for evaluation of the ALC to be paid to staff assigned to third countries in order to take account of the specific living conditions to which they are subject in the exercise of their functions in the service of the institutions outside the European Union. Since it has been established that, in the present case, the appointing authority was fully entitled to take the view that living conditions in the countries in question were equivalent to those normally obtaining in the European Union and that consequently there was no need to take account of any specific living conditions, the contested decision, which was set to come into force more than one year after its adoption precisely in order to take account of its impact on the remunerations paid, did not exceed the limits of what was necessary in order to attain the objective pursued by Article 10 of Annex X to the Staff Regulations.

72      It follows from the foregoing that the three parts of the third plea have been rejected, so the third plea must be rejected.

 The fourth plea, alleging misuse of powers and misuse of procedure

73      The applicants maintain that the contested decision was adopted not because living conditions in the countries where they are employed were equivalent to those in the countries of the European Union, but to allow the EEAS to make budgetary cuts, in the interests of its ‘credibility vis-à-vis the European Parliament and the tax payer’, according to the terms of a note of 7 June 2013 from the Chief Operating Officer of the EEAS. They submit that the contested decision is a ‘political’ decision rather than an administrative one, which does not apply the parameters set out in Article 10 of Annex X to the Staff Regulations, which alone should have been taken into account in support of that decision. The appointing authority thus arbitrarily relied on criteria other than those provided for in the Staff Regulations with the sole aim of not having to pay the ALC to the applicants. Since the administration had not, in previous years, held that the living conditions in the countries in question were equivalent to those normally obtaining in the European Union, the sole objective of the change in the method for assessing whether the living conditions in the third countries were equivalent was to reduce salary costs, under pressure from the Member States and in connection with the 2013 reform of the Staff Regulations.

74      In this connection, a decision is vitiated by misuse of powers, of which misuse of procedure is merely a form, only if it appears, on the basis of objective, relevant and consistent factors, to have been taken with the purpose of achieving ends other than those pursued by the regulations in question (judgments in Lux v Court of Auditors, 69/83, EU:C:1984:225, paragraph 30; Pitrone v Commission, T-46/89, EU:T:1990:62, paragraph 70, and Angelidis v Parliament, F-104/08, EU:F:2010:23, paragraph 89).

75      In any event, it is sufficient to reiterate the findings above, namely that the contested decision, which did not calculate the ALC payable to the applicants but which abolished the ALC to which they had previously been entitled, was lawfully adopted by the appointing authority on the basis of factors other than the parameters set out in the fourth subparagraph of Article 10(1) of Annex X to the Staff Regulations, and that the assessment carried out by the appointing authority was not vitiated by any manifest error and fell within the limits of its discretion. Since that abolition was justified in law and met the institution’s legitimate objective of adjusting remunerations on the basis of the specific conditions under which duties are performed in third countries of employment, the budgetary cuts which might result from such a decision do not reveal a misuse of power or of procedure.

76      The mere fact that the contested decision may have been described as ‘political’ by the EEAS in an internal note is not such as to call into question that assessment, where it is in no way apparent from the note at issue that the contested decision was adopted with an objective other than that for which it was lawfully envisaged. Furthermore, the fact that the appointing authority may have changed its method for assessing whether the living conditions in the third countries of employment were equivalent to those normally obtaining in the European Union, assuming this is proved, is not sufficient to establish that there was a misuse of procedure either. Since, as has been stated, there is no procedure set by the applicable legislation, the appointing authority could, as in the present case, in a field in which it has wide discretion, adjust its method of assessment from one year to the next, provided that, as in the present case, that approach did not exceed the limits of its discretion and was not contrary to any rule in the Staff Regulations or to any of the principles of EU law in the civil-service field which might be relied on by the applicants.

77      The fourth plea cannot therefore be upheld.

 The fifth plea, alleging error of law and error of facts

78      The applicants claim that the appointing authority committed an error of law in holding, in its replies to the complaints, that ‘if the administration considers that in a country “living conditions can be deemed equivalent to those normally obtaining in the Union”, the yearly review [no longer takes place]’.

79      In that regard, it must be observed that that choice of wording, as the EEAS concedes, may give rise to confusion. Nevertheless, as it is apparent from the explanations provided by the defence, by that statement the EEAS in no way meant, contrary to what the applicants claim, that an abolished ALC could not under any circumstances be re-granted. The preamble to the contested decision states, on the contrary, that the review is an annual exercise which ‘includes an analysis of the living conditions prevailing in the places of employment, seeking to ascertain whether they are or remain equivalent to those normally obtaining in the European Union’ and that, where appropriate, the appointing authority, based on that review, will decide ‘that no [ALC] need be granted or that an [ALC] must be (re)established’. Contrary to what the applicants claim, the approach adopted by the appointing authority is in no way contradictory. In any event, even if it is false, the claim criticised by the applicants has no effect on the lawfulness of the contested decision, which is, moreover, properly reasoned.

80      Lastly, the applicants submit that the appointing authority committed an error of fact by holding, as is apparent from the grounds of the rejection of the complaint brought by the applicants employed in Japan, that living conditions in that country had improved gradually over time, while stating that Japan ‘could not have experienced an improvement in absolute terms’. As the EEAS correctly points out, such reasoning does not contain any error of fact or contradictions in so far as an economic situation may not have progressed in absolute terms but may have improved in relative terms as against other countries, in the present case with regard to the countries of the European Union in respect of which, over the same reference period, living conditions had deteriorated.

81      Consequently, the fifth plea must be rejected.

 The sixth plea, alleging the infringement of the principle of legitimate expectations

82      The applicants submit that the EEAS, by not altering the ALC allocated to staff assigned to third countries in which there has not been any entitlement to the ALC since at least 2007, notwithstanding the financial crisis, raised legitimate expectations that it would be maintained, a fortiori because the situation has deteriorated in the countries concerned, as a result of, in particular, the Fukushima accident in Japan, the poor air quality in Chile or in China, poor health conditions in Singapore or the high level of criminality in Argentina.

83      The EEAS contends that the plea should be rejected.

84      It must be observed in this connection that the right to rely on the principle of the protection of legitimate expectations extends to any individual who is in a situation in which it is apparent that the administration has led him to entertain justified expectations by giving him precise assurances in the form of precise, unconditional and consistent information coming from authorised and reliable sources (see, for example, judgment in Centeno Mediavilla and Others v Commission, T-58/05, EU:T:2007:218, paragraph 96).

85      In the present case and in any event, the mere fact that the ALC has remained unchanged for several years is insufficient to enable the applicants to rely on the principle of the protection of legitimate expectations since the provisions governing the award of the ALC provide expressly that it is subject to an annual evaluation and therefore that it may be altered from one year to the next or even abolished. The applicants cannot reasonably claim, in those circumstances, that the administration, in not having altered the ALC since the beginning of the economic crisis, had provided them with precise and unconditional assurances such as to give rise to a right to the ALC for them.

86      Moreover, as was pointed out in paragraph 71 above, the appointing authority provided for a deferred application of the contested decision, thereby ensuring a smooth transition over time between the old situation and the new such as to give adequate protection to the applicants’ expectations that a given legal situation would be maintained.

87      The sixth plea in law must therefore also be rejected.

88      It follows from all the foregoing that the claims for annulment must be rejected.

 The claims for an injunction

89      In proceedings for judicial review brought under Article 91 of the Staff Regulations it is not for the European Union judicature to issue injunctions to Community institutions (judgment in Di Marzio v Commission, T-14/03, EU:T:2004:59, paragraph 63). It follows that the claims by which the applicants request the Tribunal to order payment of the ALC to which they maintain they are entitled must be rejected as inadmissible.

90      It follows from all the foregoing that the present action must be dismissed.

 Costs

91      Under Article 87(1) of the Rules of Procedure, without prejudice to the other provisions of Chapter 8 of Title 2 of those Rules, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Under Article 87(2), the Tribunal may, if equity so requires, decide that an unsuccessful party is to pay only part of the costs or even that that party is not to be ordered to pay any. In addition, if costs are not applied for, in accordance with Article 89(3) of the Rules of Procedure, the parties are to bear their own costs.

92      It is apparent from the reasons set out in the present judgment that the applicants have been unsuccessful in their action. However, the EEAS has not expressly requested in its claims that the applicants be ordered to pay the costs, but merely requested the Tribunal to make an order as to costs. Since the circumstances of the present case do not warrant the application of Article 87(2) of the Rules of Procedure, the applicants and the EEAS must each bear their own costs.

On those grounds,

THE CIVIL SERVICE TRIBUNAL (Third Chamber)

hereby:

1.      Dismisses the action.

2.      Declares that Mr Julien-Malvy and the other applicants whose names are set out in the annex shall bear their own costs.

3.      Declares that the European External Action Service shall bear its own costs.

Delivered in open court in Luxembourg on 25 September 2014.

ANNEX

Having regard to the number of applicants in this case, their names are not reproduced in the present annex.

* Language of the case: English.