CELEX: 61958CJ0032
Société nouvelle des usines de Pontlieue
Aciéries du Temple (S.N.U.P.A.T.) v High Authority of the European Coal and Steel Community

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FIRST PART : CASE 32/58
ADMISSIBILITY
1 . THE LETTER FROM THE CPFI OF 12 MAY 1958
( A ) WAS THE APPLICATION AGAINST THAT LETTER LODGED WITHIN THE PRESCRIBED PERIOD?
THE DEFENDANT RAISES A SUBMISSION OF INADMISSIBILITY, ARGUING THAT THE APPLICATION AGAINST THE SAID LETTER WAS NOT LODGED WITHIN THE PRESCRIBED PERIOD .
THE REGISTERED OFFICE OF THE APPLICANT IS AT BILLANCOURT ( SEINE ), THAT IS, IN METROPOLITAN FRANCE . THEREFORE, UNDER THE THIRD PARAGRAPH OF ARTICLE 33 OF THE ECSC TREATY AND ARTICLE 85 ( 1 ) AND ( 2 ) OF THE RULES OF PROCEDURE OF THE COURT OF JUSTICE OF THE ECSC, THE PERIOD WITHIN WHICH THE APPLICANT HAD TO CONTEST THE SAID LETTER EXPIRED ONE MONTH AND THREE DAYS FROM THE DAY FOLLOWING NOTIFICATION THEREOF .
ACCORDINGLY, THE APPLICATION, WHICH WAS LODGED AT THE COURT REGISTRY ON 30 JUNE 1958, WAS ONLY LODGED WITHIN THE PRESCRIBED PERIOD IF THE LETTER OF 12 MAY 1958 ONLY REACHED THE APPLICANT ON 26 MAY AT THE EARLIEST, 29 JUNE 1958 BEING A SUNDAY SO THAT THE EXPIRY OF A PERIOD ENDING ON THAT DAY IS TO BE CARRIED FORWARD TO MONDAY 30 JUNE .
THE EXPLANATIONS GIVEN BY THE PARTIES HAVE NOT ENABLED THE DATE ON WHICH THE APPLICANT RECEIVED NOTIFICATION OF THE SAID LETTER TO BE ESTABLISHED, SO THAT THE POINT AT WHICH TIME BEGAN TO RUN IS UNCERTAIN .
IT IS UNLIKELY THAT A LETTER POSTED IN BRUSSELS AND DATED 12 MAY DID NOT ARRIVE AT SAINT-MICHEL-DE-MAURIENNE ( SAVOY ) BEFORE 26 MAY, BUT IT IS NOT ABSOLUTELY IMPOSSIBLE, AS THE DATE ON WHICH THE LETTER WAS SENT IS NOT CERTAIN .
THERE MUST BE TAKEN INTO ACCOUNT THE FACT THAT THE REASONS WHY THE DAY ON WHICH TIME STARTED TO RUN IS UNCERTAIN ARE THAT THE CPFI, WHOSE CONDUCT IS ATTRIBUABLE TO THE DEFENDANT, OMITTED TO SEND THE LETTER OF 12 MAY BY REGISTERED POST AND THAT THE DEFENDANT HAS NOT BEEN ABLE TO PROVIDE ANY INDICATION AS TO THE DAY ON WHICH THE LETTER WAS POSTED BY THE CPFI . THEREFORE THE APPLICANT MUST BE ACCORDED THE BENEFIT OF THE DOUBT .
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ACCORDINGLY, THE APPLICATION IS ADMISSIBLE .
( B ) DOES THE LETTER OF 12 MAY 1958 CONSTITUTE A DECISION?
THE DEFENDANT RAISES ANOTHER SUBMISSION OF INADMISSIBILITY, ARGUING THAT THE LETTER OF 12 MAY 1958 DOES NOT CONSTITUTE A DECISION .
THAT LETTER WAS WRITTEN IN RELATION TO THE SCHEME SET UP BY DECISION NO 2/57 OF THE HIGH AUTHORITY, WHICH ENTERED INTO FORCE ON 1 FEBRUARY 1957 AND WAS TO EXPIRE ON 31 JULY 1958, IN ACCORDANCE WITH ARTICLE 19 THEREOF . ARTICLE 12 ( 2 ) AND ( 3 ) OF THAT DECISION PROVIDES :
" 2 . THE FUND SHALL NOTIFY THE UNDERTAKINGS OF THE AMOUNT OF THE CONTRIBUTION TO BE PAID AND THE TIME-LIMITS FOR PAYMENT .
IT SHALL HAVE AUTHORITY TO RECEIVE THOSE AMOUNTS .
3 . WHERE A PAYMENT IS NOT MADE BEFORE EXPIRY OF THE TIME-LIMIT, THE FUND SHALL CALL UPON THE HIGH AUTHORITY TO ACT, AND THE LATTER MAY ADOPT AN ENFORCEABLE DECISION . "
1 . THE LETTER OF 12 MAY 1958 INVITES THE APPLICANT TO PAY A SUM BY WAY OF EQUALIZATION LEVY ON FERROUS SCRAP AND TO DRAW UP ITS RETURNS IN ACCORDANCE WITH THE LETTER OF THE HIGH AUTHORITY OF 18 DECEMBER 1957 .
THE LETTER THUS CONSTITUTES " NOTIFICATION " FOR THE PURPOSES OF THE ABOVEMENTIONED DECISIONS, CREATING THE OBLIGATION TO PAY THE SUMS INDICATED .
UNDER THE SCHEME SET UP BY DECISION NO 2/57, SUCH " NOTIFICATIONS " IN FACT CONSTITUTED THE LAST WORD OF THE ADMINISTRATION, THE HIGH AUTHORITY CONFINING ITSELF TO MAKING THEM ENFORCEABLE, WHERE NECESSARY, WITHOUT CLAIMING TO RE-EXAMINE THEM . THEY GAVE RISE TO AN OBLIGATION ON THE PART OF THE UNDERTAKINGS TO WHICH THEY WERE ADDRESSED . THEY THEREFORE CONTAINED ALL THE ELEMENTS OF AN ADMINISTRATIVE DECISION AS SUCH .
IN THESE CIRCUMSTANCES, IT WOULD BE WRONG TO SAY THAT THERE IS ONLY A DECISION WHEN THE HIGH AUTHORITY ISSUES AN ENFORCEABLE DECISION, PARTICULARLY SINCE THAT ONLY HAPPENS WHEN AN UNDERTAKING HAS FAILED TO FULFIL ITS OBLIGATIONS .
2 . ARTICLE 33 OF THE ECSC TREATY ONLY PROVIDES FOR ACTIONS AGAINST DECISIONS OF THE HIGH AUTHORITY . IT IS THEREFORE NECESSARY TO EXAMINE WHETHER DECISIONS ADOPTED BY THE CPFI ARE EQUIVALENT TO DECISIONS OF THE HIGH AUTHORITY .
IN THIS REGARD THERE MUST BE TAKEN INTO CONSIDERATION THE FACT THAT THE CPFI WAS AN ORGAN OF A FINANCIAL ARRANGEMENT SET UP BY THE HIGH AUTHORITY AND THAT IT HELD ITS POWERS FROM THE LATTER .
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MOREOVER, AS HAS BEEN FOUND ABOVE, NOTIFICATIONS FROM THE CPFI IN FACT CONSTITUTED THE FINAL ADMINISTRATIVE DECISION, WHICH THE HIGH AUTHORITY COULD HAVE AVOIDED IF IT HAD MADE PROVISION FOR ADMINISTRATIVE APPEALS AGAINST THE DELIBERATIONS OF THE BRUSSELS AGENCIES UNDER CLEARLY DEFINED CONDITIONS .
THEREFORE, IT MUST BE ACCEPTED - AND TO DO OTHERWISE WOULD BE TO DEPRIVE THE UNDERTAKINGS OF THE PROTECTION AFFORDED THEM BY ARTICLE 33 OF THE ECSC TREATY - THAT THE DECISIONS ADOPTED BY THE CPFI UNDER ARTICLE 12 ( 2 ) OF DECISION NO 2/57 RANK AS DECISIONS OF THE HIGH AUTHORITY AND, AS SUCH, ARE OPEN TO APPLICATIONS FOR ANNULMENT UNDER THE CONDITIONS LAID DOWN IN ARTICLE 33 .
THE CONTESTED DECISION IS INDIVIDUAL IN CHARACTER AND CONCERNS THE APPLICANT .
THEREFORE THE APPLICATION AGAINST THE LETTER OF 12 MAY 1958 IS ADMISSIBLE .
2 . THE ACTION FOR FAILURE TO ACT
THE APPLICANT'S LETTERS OF 31 MARCH 1958, ADDRESSED TO THE BRUSSELS AGENCIES, CAN BE CONSIDERED AS CLAIMS LODGED WITH THE HIGH AUTHORITY AND SETTING IN MOTION THE PROCEDURE UNDER ARTICLE 35 OF THE ECSC TREATY . THIS, MOREOVER, IS NOT DENIED BY THE DEFENDANT .
THE DEFENDANT DOES NOT RAISE ANY OBJECTIONS AS TO THE ADMISSIBILITY OF THE ACTION FOR FAILURE TO ACT, IN THAT IT ADMITS THAT NO DECISION WAS ADOPTED WITHIN THE PERIOD OF TWO MONTHS LAID DOWN IN THE THIRD PARAGRAPH OF ARTICLE 35 OF THE ECSC TREATY . THAT QUESTION, HOWEVER, MUST BE EXAMINED BY THE COURT OF ITS OWN MOTION .
IT APPEARS FROM DECLARATIONS MADE BY THE DEFENDANT AND FROM THE DOCUMENTS PRODUCED BY IT THAT THE LETTERS OF 31 MARCH 1958, BY WHICH THE APPLICANT LODGED REQUESTS FOR EXEMPTION WITH THE OCCF AND THE CPFI RESPECTIVELY, REACHED THOSE AGENCIES ON 1 APRIL 1958 . ACCORDING TO A GENERALLY ACCEPTED RULE, TIME-LIMITS ARE CALCULATED EXCLUSIVE OF THE DAY OF THE MEASURE WHICH SETS TIMES RUNNING, SAVE WHERE PROVIDED OTHERWISE . THUS THE ABOVEMENTIONED PERIOD OF TWO MONTHS BEGAN TO RUN ON 2 APRIL AND EXPIRED ON 1 JUNE 1958 .
THE LETTER FROM THE OCCF OF 2 JUNE, WHICH WAS IN ANSWER TO THE ABOVEMENTIONED REQUEST FOR EXEMPTION, THUS CAME INTO EXISTENCE AFTER THE EXPIRY OF THE TIME-LIMIT INVOLVED . ACCORDINGLY, QUITE APART FROM THE QUESTION WHETHER OR NOT THAT LETTER CONSTITUTES A DECISION, IT IS ESTABLISHED THAT THE ADMINISTRATION DID NOT TAKE ANY DECISION BEFORE THE EXPIRY OF THE SAID TIME-LIMIT .
THEREFORE, UNDER THE THIRD PARAGRAPH OF ARTICLE 35 OF THE ECSC TREATY, THE HIGH AUTHORITY IS DEEMED TO HAVE DECIDED, ON 1 JUNE 1958, TO REFUSE THE REQUEST FOR EXEMPTION .
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THE APPLICATION AGAINST THAT IMPLIED DECISION OF REFUSAL IS THEREFORE ADMISSIBLE .
3 . THE APPLICATION AGAINST THE LETTER FROM THE OCCF OF 2 JUNE 1958
IT IS ONLY " IN SO FAR AS IS NECESSARY " THAT THE APPLICANT CONTESTS THE SAID LETTER, WHICH IT DESCRIBES AS A " DECISION TO POSTPONE TAKING A DECISION ".
THE COURT HAS DECLARED THAT THE APPLICATION FOR THE ANNULMENT OF THE LETTER OF 12 MAY 1958 AND THE ACTION FOR FAILURE TO ACT IN RESPECT OF THE IMPLIED DECISION OF REFUSAL ARE ADMISSIBLE .
IN THESE CIRCUMSTANCES, THERE IS NO NEED TO RULE ON THE ADMISSIBILITY OR THE SUBSTANCE OF THE APPLICATION AGAINST THE LETTER OF 2 JUNE 1959 .
SUBSTANCE
1 . CAN THE APPLICANT RAISE AN OBJECTION OF ILLEGALITY AGAINST THE LETTERS OF THE HIGH AUTHORITY OF 18 DECEMBER 1957 AND 17 APRIL 1958?
ACCORDING TO THE ESTABLISHED CASE-LAW OF THE COURT, AN UNDERTAKING WHICH CONTESTS AN INDIVIDUAL DECISION IS ENTITLED TO RAISE THE OBJECTION OF ILLEGALITY AGAINST THE GENERAL DECISIONS ON WHICH THEY ARE BASED .
THE PARTIES ARE IN AGREEMENT ABOUT THE FACT THAT THE LETTER FROM THE CPFI OF 12 MAY 1958 AND THE IMPLIED DECISION OF REFUSAL OF 1 JUNE 1958 ARE BASED ON THE PRINCIPLES SET OUT IN THE ABOVEMENTIONED LETTERS OF THE HIGH AUTHORITY; AND SUCH INDEED IS MANIFESTLY THE CASE . THE QUESTION THEREFORE ARISES WHETHER THOSE LETTERS CONSTITUTE DECISIONS .
( A ) DOES THE LETTER OF 18 DECEMBER 1957 CONSTITUTE A DECISION?
THE LETTER FROM THE HIGH AUTHORITY DATED 18 NOVEMBER 1957 STATES A GENERAL PRINCIPLE IN THAT IT REFERS TO THE DEFINITION OF THE CONCEPT OF " OWN RESOURCES " REGARDING FERROUS SCRAP .
THAT LETTER WAS PUBLISHED IN THE JOURNAL OFFICIEL OF 1 FEBRUARY 1958 AND THUS BROUGHT TO THE NOTICE OF ALL THE UNDERTAKINGS OF THE COMMUNITY .
IT WAS DESCRIBED AS A " DECISION " BY THE MARKET DIVISION, IN A LETTER OF 19 FEBRUARY 1958, IN ANSWER TO A FORMAL QUESTION MADE BY THE DEUTSCHE SCHROTTVERBRAUCHERGEMEINSCHAFT TO THE HIGH AUTHORITY ON 6 FEBRUARY 1958 .
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NEVERTHELESS, CONTRARY TO THE APPLICANT'S ARGUMENTS, THE SAID LETTER OF 18 DECEMBER 1957 CANNOT LEGALLY BE CONSIDERED AS A DECISION WITHIN THE MEANING OF THE TREATY .
ADMITTEDLY, THE LETTER OF 18 DECEMBER 1957 WAS IN ANSWER TO A REQUEST FROM THE OCCF, WHOSE MEMBERS HAD FAILED TO AGREE ON THE MEANING OF THE WORDS " OWN RESOURCES ", AND WHICH HAD THEREFORE CALLED UPON THE HIGH AUTHORITY TO DEFINE THAT CONCEPT PURSUANT TO THE SECOND PARAGRAPH OF ARTICLE 15 OF DECISION NO 2/57 . BUT THE HIGH AUTHORITY REPLID THAT THE PROBLEM THUS EXPRESSED BY THE OCCF " WAS WRONGLY PUT ", IN VIEW OF THE FACT THAT THE OCCF HAD " FROM THE BEGINNING BY IMPLICATION ADOPTED THE CONCEPT OF OWN RESOURCES ACCORDING TO THE SEMANTIC MEANING OF THE TERM ", AND THAT CRITERION SHOULD BE MAINTAINED .
IT FOLLOWS THAT THE HIGH AUTHORITY DID NOT INTEND TO TAKE A DECISION, AS IT HAD BEEN FORMALLY INVITED TO DO, BUT SIMPLY TO REAFFIRM THE PRINCIPLE WHICH, RIGHTLY OR WRONGLY, IT CONSIDERED TO EMERGE LOGICALLY FROM THE BASIC DECISION NO 2/57 .
THIS FINDING IS CONFIRMED BY THE FACT THAT BY ARTICLE 53 ( B ) OF THE TREATY AN AMENDMENT TO DECISION NO 2/57 WOULD HAVE REQUIRED THE PRIOR UNANIMOUS ASSENT OF THE COUNCIL OF MINISTERS, AND THAT CONDITION WAS NOT FULFILLED IN THIS CASE . MOREOVER, THERE IS NOTHING TO SUGGEST THAT THE HIGH AUTHORITY KNOWINGLY DISREGARDED THAT BINDING REQUIREMENT .
THESE CONSIDERATIONS ARE NOT INVALIDATED BY THE FACT THAT, IN ANSWER TO A FORMAL QUESTION FROM THE DEUTSCHE SCHROTTVERBRAUCHERGEMEINSCHAFT TO THE HIGH AUTHORITY ON 6 FEBRUARY 1958, THE MARKET DIVISION REPLIED BY LETTER OF 19 FEBRUARY 1958 THAT THE LETTER OF 18 DECEMBER 1957 WAS INDEED A " DECISION ".
IN FACT, THAT ANSWER FROM THE MARKET DIVISION EXPRESSES, AS IT ITSELF SAYS, THE OPINION OF AN OFFICIAL OF THE HIGH AUTHORITY AND DOES NOT NECESSARILY OF ITSELF REFLECT THE INTENTIONS OF THE HIGH AUTHORITY IN THE MATTER .
HOWEVER, THE VARIOUS SUBJECTIVE ELEMENTS SET OUT ABOVE CANNOT OF THEMSELVES BE DECISIVE IN DETERMINING THE NATURE OF THE SAID LETTER OF 18 DECEMBER 1957, FOR THE NATURE OF A MEASURE DEPENDS PRIMARILY ON ITS SUBJECT-MATTER AND CONTENT .
THE SAID LETTER APPEARS AS BEING AN INTERNAL INSTRUCTION ADDRESSED BY AN IMMEDIATE SUPERIOR TO THE DEPARTMENT UNDER HIS CHARGE AND INTENDED TO ORIENTATE THE ACTIVITIES OF THAT DEPARTMENT .
THUS, WHILE THAT LETTER MAY HAVE GIVEN RISE TO IMMEDIATE OBLIGATIONS, IT CAN ONLY HAVE DONE SO AS REGARDS THE AGENCY TO WHICH IT WAS ADDRESSED AND NOT AS REGARDS UNDERTAKINGS CONSUMING FERROUS SCRAP . THIS VIEW OF THE MATTER, MOREOVER, IS SUPPORTED BY THE FACT THAT THE SAID LETTER OF 18 DECEMBER 1957 WAS ONLY PUBLISHED IN THE JOURNAL OFFICIEL ON 1 FEBRUARY 1958 .
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THEREFORE THE LETTER OF 18 DECEMBER 1957 IS NOT A DECISION WITHIN THE MEANING OF THE TREATY .
( B ) DOES THE LETTER OF 17 APRIL 1958 CONSTITUTE A DECISION?
GENERALLY, THE CONSIDERATIONS DEVELOPED ABOVE IN RESPECT OF THE LETTER OF 18 DECEMBER 1957 ARE EQUALLY VALID FOR THE LETTER OF 17 APRIL 1958 .
MORE PARTICULARLY, ITS PURPOSE IS ONLY TO EXPLAIN TO THE OCCF THE REASONS WHY THE HIGH AUTHORITY, IN ITS LETTER OF 18 DECEMBER, APPROVED THE EXEMPTIONS GRANTED TO TWO SPECIFIC UNDERTAKINGS, SAYING THAT THE WORKS OF THOSE UNDERTAKINGS WERE " LOCALLY INTEGRATED WITH ONE OR SEVERAL WORKS NOT BELONGING TO THEM, IN WHICH FERROUS SCRAP IS RECOVERED ".
THUS THE LETTER DOES NOT SET OUT A NEW PRINCIPLE, BUT MERELY EXPRESSLY STATES A PRINCIPLE WHICH THE ADMINISTRATION HAS ALREADY APPLIED BY IMPLICATION IN IMPLEMENTING DECISION NO 2/57 .
THEREFORE THE LETTER OF 17 APRIL 1958 DOES NOT CONSTITUTE A DECISION WITHIN THE MEANING OF THE TREATY .
2 . MAY THE COURT EXAMINE THE LEGALITY OF THE PRINCIPLES SET OUT IN THE LETTERS OF 18 DECEMBER 1957 AND 17 APRIL 1958?
FROM THE MOMENT WHEN THE PRINCIPLS SET OUT IN THE ABOVEMENTIONED LETTERS WERE APPLID BY THE ADMINISTRATION, THEY FORMED PART OF THE INTERPRETATION AND APPLICATION OF DECISION NO 2/57 .
THE HIGH AUTHORITY'S INTERPRETATION HAS AFFECTED THE APPLICANT'S RIGHTS FROM THE MOMENT WHEN THE AGENCIES TO WHICH THE LETTERS OF 18 DECEMBER 1957 AND 17 APRIL 1958 WERE ADDRESSED APPLIED THAT INTERPRETATION IN RESPECT OF IT .
THE QUESTION SHOULD THEREFORE BE EXAMINED WHETHER THE INTERPRETATION OF DECISION NO 2/57, AS IT APPEARS FROM THE LETTERS OF 18 DECEMBER 1957 AND 17 APRIL 1958, IS LEGAL .
3 . IS IT LEGAL TO SUBJECT GROUP FERROUS SCRAP TO EQUALIZATION?
( A ) ARTICLE 2 OF DECISION NO 2/57 PROVIDES THAT " UNDERTAKINGS OF THE KIND DESCRIBED IN ARTICLE 80 OF THE TREATY WHICH CONSUME FERROUS SCRAP SHALL BE ASSESSABLE TO PAYMENT OF CONTRIBUTIONS " UNDER THE EQUALIZATION SCHEME .
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ARTICLE 4 OF THE SAME DECISION STATES THAT THOSE CONTRIBUTIONS SHALL BE CALCULATED ON THE BASIS OF SUPPLIES OF " BOUGHT FERROUS SCRAP " WHEREAS " OWN RESOURCES " SHALL BE EXEMPT FROM EQUALIZATION .
THE DELIVERIES OF FERROUS SCRAP TO THE APPLICANT BY REGIE RENAULT CONSTITUTE PURCHASES, BECAUSE THERE IS AN AGREEMENT FOR THE PASSING OF PROPERTY AGAINST A PRICE .
BY REASON OF THAT FACT, ACCORDING TO THE WORDING OF DECISION NO 2/57 SUCH SCRAP IS SUBJECT TO EQUALIZATION . THE APPLICANT REQUESTS EXEMPTION, TAKING THE VIEW THAT GROUP SCRAP SHOULD BE ASSIMILATED TO OWN RESOURCES . IT IS THEREFORE NECESSARY TO EXAMINE WHETHER SUCH ASSIMILATION IS JUSTIFIED .
( B ) AS APPEARS FROM A READING OF THE LETTER OF 18 DECEMBER 1957, THE HIGH AUTHORITY INTERPRETS THE CONCEPT OF " OWN RESOURCES " AS MEANING THAT IT IS ONLY SCRAP RECOVERED BY AN UNDERTAKING IN ITS OWN ESTABLISHMENTS BEARING THE SAME COMPANY NAME THAT IS CONSIDERED AS " OWN RESOURCES ", WHEREAS SCRAP SUPPLIED BY A WORKS RUN UNDER ANOTHER COMPANY NAME IS CONSIDERED AS BOUGHT SCRAP, EVEN IN THE CASE WHERE CLOSE FINANCIAL OR ADMINISTRATIVE LINKS EXIST BETWEEN THE SUPPLIER AND THE USER .
( C ) HOWEVER, IT IS NECESSARY TO EXAMINE WHETHER THE ASSESSING OF GROUP SCRAP TO THE LEVY - AND THE EXEMPTION FOR OWN ARISINGS - IS COMPATIBLE WITH THE PURPOSES OF THE FINANCIAL ARRANGEMENT CONSTITUTED BY THE EQUALIZATION SYSTEM .
( I ) ACCORDING TO THE APPLICANT, THERE IS NO VALID REASON FOR SUBJECTING GROUP SCRAP TO THE EQUALIZATION SYSTEM, BECAUSE THE OPERATIONS BETWEEN THE VARIOUS AFFILIATED UNDERTAKINGS TAKE PLACE OUTSIDE THE MARKET IN FERROUS SCRAP AND DO NOT, BY REASON OF THAT FACT, EXERCISE ANY INFLUENCE ON THE EVOLUTION OF PRICES .
ACCORDING TO THE APPLICANT, THE PURPOSE OF EQUALIZATION IS TO MAINTAIN THE PRICES OF FERROUS SCRAP AT A REASONABLE LEVEL, SO THAT ANY TRANSFER OF SCRAP NOT LIABLE TO HAVE REPERCUSSIONS ON THE LEVEL OF PRICES MUST BE EXEMPTED FROM EQUALIZATION .
IN FACT, THE PURPOSE OF EQUALIZATION IS TO MAINTAIN THE PRICE OF FERROUS SCRAP AT AN ACCEPTABLE LEVEL; HOWEVER, IN ORDER TO ACHIEVE THAT OBJECTIVE THE HIGH AUTHORITY HAS ESTABLISHED FINANCIAL ARRANGEMENTS THE PRINCIPLE OF WHICH IS TO ENSURE THAT THE EXCESS PRICE OF IMPORTED FERROUS SCRAP IS BORNE BY ALL THE CONSUMERS OF FERROUS SCRAP .
IT IS NOT PARTICIPATION IN THE FERROUS SCRAP MARKET WHICH GIVES RISE TO THE EQUALIZATION LEVY, BUT THE CONSUMPTION OF FERROUS SCRAP .
ALL CONSUMERS ARE THEREFORE AUTOMATICALLY REQUIRED TO PAY EQUALIZATION CONTRIBUTIONS IN ORDER TO FINANCE THE EQUALIZATION FUND .
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THEREFORE, THIS COMPLAINT PUT FORWARD BY THE APPLICANT MUST BE REJECTED .
( II ) HOWEVER, DECISION NO 2/57 PROVIDED FOR A DISTINCTION BETWEEN BOUGHT FERROUS SCRAP AND OWN RESOURCES, AND THIS CONSTITUTES, AS REGARDS THE LATTER, AN EXCEPTION TO THE GENERAL RULE MENTIONED ABOVE .
IT IS THEREFORE NECESSARY TO EXAMINE WHETHER THE EXONERATION OF OWN RESOURCES IS LEGAL .
THAT EXCEPTION PRIMARILY CONCERNS OWN ARISINGS FROM THE PRODUCTION OF STEEL BY THE UNDERTAKINGS SUBJECT TO THE JURISDICTION OF THE COMMUNITY .
IF THOSE ARISINGS WERE SUBJECT TO EQUALIZATIONS CONTRIBUTIONS, THERE WOULD BE A PROBABILITY OF CHARGING THE SAME QUANTITY OF FERROUS SCRAP TWICE OVER, WHICH WOULD BE MANIFESTLY UNJUST .
( D ) THE REASONING SET OUT ABOVE IS CONFIRMED BY THE CONCEPT OF DISCRIMINATION AS IT APPEARS IN PARTICULAR FROM THE SECOND PARAGRAPH OF ARTICLE 2 AND ARTICLES 3 ( B ), 60 AND 67 OF THE TREATY .
( I ) ON THE BASIS OF THE ABOVEMENTIONED PROVISIONS THERE MAY BE CONSIDERED AS DISCRIMINATORY IN PRINCIPLE AND, ACCORDINGLY, PROHIBITED BY THE TREATY, INTER ALIA, MEASURES OR INTERVENTIONS, EVEN THOSE EMANATING FROM THE HIGH AUTHORITY, WHICH ARE CALCULATED, BY SUBSTANTIALLY INCREASING DIFFERENCES IN PRODUCTION COSTS OTHERWISE THAN THROUGH CHANGES IN PRODUCTIVITY, TO GIVE RISE TO AN APPRECIABLE DISEQUILIBRIUM IN THE COMPETITIVE POSITION OF THE UNDERTAKINGS CONCERNED .
IN OTHER WORDS, ANY INTERVENTION ATTEMPTING TO DISTORT OR ACTUALLY DISTORTING COMPETITION ARTIFICIALLY AND SIGNIFICANTLY MUST BE REGARDED AS DISCRIMINATORY AND INCOMPATIBLE WITH THE TREATY, WHILST MEASURES WHICH TAKE INTO ACCOUNT THE INTERNAL ORGANIZATION OF AN UNDERTAKING AND THE USE BY IT OF ITS OWN RESOURCES CANNOT BE REGARDED AS DISCRIMINATORY .
THE USE OF ITS OWN ARISINGS BY A SINGLE UNDERTAKING PRODUCING STEEL AND USING FERROUS SCRAP AMOUNTS TO A PRODUCTION RECYCLING OF ONE OF ITS BY-PRODUCTS .
THIS BEING SO, SUCH A USE IN THE PROCESS OF THE PRODUCTION OF STEEL FROM FERROUS SCRAP CLEARLY REPRESENTS AN INCREASE IN THE QUANTITY OF STEEL OBTAINED FROM THE SAME QUANTITY OF FERROUS SCRAP, WHICH HAS ALREADY BEEN SUBJECTED TO EQUALIZATION . IT THUS REPRESENTS AN ACQUIRED INCREASE IN PRODUCTIVITY .
TO SAY THAT AN INTERVENTION ENCOURAGING THOSE INTERNAL MEASURES OF ECONOMY DISTORTS COMPETITION IS THE VERY OPPOSITE OF THE TRUTH . SUCH AN INTERVENTION FAVOURS CHANGES IN PRODUCTIVITY IN THE DIRECTION OF GREATER PRODUCTIVITY, BY THE FORM OF COMPETITION DESCRIBED IN GERMAN AS " LEISTUNGSWETTBEWERB ", AND THEREFORE ACCORDS WITH THE TREATY .
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MOREOVER IT APPEARS FROM ANNEX II TO THE ECSC TREATY, SECOND PARAGRAPH OF ( B ), THAT " UNDERTAKINGS' OWN ARISINGS " ENJOY PRIVILEGED TREATMENT EVEN IN THE CASE OF A DIRECT INTERVENTION UNDER ARTICLE 59 OF THE TREATY . THEREFORE A FORTIORI THEY MUST ALSO RECEIVE PRIVILEGED TREATMENT IN THE APPLICATION OF INDIRECT MEASURES OF INTERVENTION SUCH AS THOSE AUTHORIZED BY ARTICLE 53 .
IT FOLLOWS FROM EVERYTHING THAT HAS BEEN SAID ABOVE THAT THE EXEMPTION OF OWN RESOURCES IS NOT DISCRIMINATORY AND IS THEREFORE LEGITIMATE .
( II ) TO ASSIMILATE GROUP SCRAP TO OWN ARISINGS WOULD BE TO GO BEYOND THE MEANING OF AND THE REASON FOR THE EXEMPTION AND WOULD CONSTITUTE A DISCRIMINATORY ADVANTAGE AS REGARDS OTHER UNDERTAKINGS .
THE LOWERING OF PRODUCTION COSTS CONSEQUENT UPON AN EXONERATION FOR GROUP SCRAP WOULD, IN THE WORDS OF ARTICLE 67 OF THE TREATY, BE LIABLE SUBSTANTIALLY TO INCREASE DIFFERENCES IN PRODUCTION COSTS AS BETWEEN THOSE UNDERTAKINGS AND THOSE WHICH ALSO PRODUCE STEEL FROM FERROUS SCRAP BUT WHICH ARE NOT INTEGRATED WITH AN UNDERTAKING PRODUCING THAT RAW MATERIAL .
THAT INCREASE IN THE DIFFERENCES IN PRODUCTION COSTS WOULD NOT RESULT FROM CHANGES IN PRODUCTIVITY, BUT WOULD BE THE EFFECT OF CONTINGENT, GEOGRAPHICAL, ADMINISTRATIVE OR FINANCIAL TIES, WHICH ARE AT THE BASIS OF THE CONCEPT OF A " GROUP ". IT MUST BE OBSERVED FROM THE SCHEME OF THE TREATY AND FROM ITS FUNDAMENTAL PRINCIPLES THAT THE WORD " PRODUCTIVITY " REFERS EXCLUSIVELY TO THE RESULTS OF THE EFFORTS MADE BY AN UNDERTAKING . IN PARTICULAR, IT MUST BE UNDERSTOOD AS AGAINST ANY IMPROVEMENT IN THE COMPETITIVE POSITION OF AN UNDERTAKING WHICH IS DUE EITHER TO INTERVENTIONS OF PUBLIC AUTHORITIES OR TO THE CREATION OF A CARTEL OR A CONCENTRATION, BECAUSE ALL THESE OPERATIONS, EVEN WHERE AUTHORIZED OR CAPABLE OF BEING AUTHORIZED, ARTIFICIALLY ALTER THE NORMAL EFFECT OF COMPETITION .
( E ) IT WOULD BE MANIFESTLY CONTRARY TO THE REQUIREMENTS OF THE TREATY IF, AS A RESULT OF AN INTERVENTION ON THE PART OF THE HIGH AUTHORITY, THE PRODUCTION COSTS OF STEEL MANUFACTURED IN WHOLE OR IN PART FROM FERROUS SCRAP WERE TO DEPEND ON THE LEGAL, ADMINISTRATIVE OR FINANCIAL STRUCTURE OF INDUSTRIAL GROUPS .
THE CHANGES IN THE LEGAL STRUCTURE OF THE GROUP, THE EXISTENCE OF WHICH IS STRESSED BY THE APPLICANT, ONLY GO TO SHOW THAT SUCH CHANGES ARE ARBITRARY AND AVAILABLE UPON A MOMENT'S NOTICE, AND SO PREVENT THEIR BEING SEEN AS A FACTOR SPECIFIC TO THE PRODUCTIVITY OF THE STEEL-PRODUCING UNDERTAKING .
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( F ) FOR ALL THESE REASONS, ALTHOUGH THE EXONERATION OF OWN ARISINGS IS COMPATIBLE WITH THE PROVISIONS OF THE TREATY, AN EXONERATION FOR GROUP SCRAP WOULD BRING ABOUT DISCRIMINATION PROHIBITED BY ARTICLE 4 OF THE TREATY .
IN VIEW OF THAT FACT, THE LATTER EXONERATION MUST ITSELF BE TAKEN TO BE PROHIBITED BY THE TREATY, WITHOUT ITS BEING NECESSARY, IN THE PRESENT CASE, TO RULE ON THE QUESTION WHETHER OR NOT FERROUS SCRAP ORIGINATING FROM AN UNDERTAKING WHICH IS NOT A PRODUCER OF STEEL AND IS NOT, THEREFORE, SUBJECT TO THE JURISDICTION OF THE COMMUNITY SHOULD, FOR THAT REASON, BE EXEMPT FROM EQUALIZATION, EVEN IF IT FORMS PART OF A GROUP WITH THE UNDERTAKING USING THE FERROUS SCRAP OR IS RUN UNDER THE SAME COMPANY NAME .
IT RESULTS FROM THE FOREGOING CONSIDERATIONS THAT THE DEFENDANT ACTED LEGALLY IN APPLYING THE PRINCIPLE THAT SO-CALLED GROUP FERROUS SCRAP MUST BE CONSIDERED AS BOUGHT FERROUS SCRAP AND, THEREFORE, AS SUBJECT TO EQUALIZATION, AND IN REAFFIRMING THAT PRINCIPLE IN ITS LETTER OF 18 DECEMBER 1957 .
THE APPLICANT NEITHER DISCUSSES NOR CONTESTS THE METHOD OF CALCULATING THE AMOUNT WHICH IT IS CALLED UPON TO PAY IN THE LETTER FROM THE CPFI OF 12 MAY 1958, BUT ONLY THE PRINCIPLES UPON WHICH IT IS CHARGED .
THEREFORE THE APPLICATION FOR ANNULMENT OF THE LETTER OF 12 MAY 1958 FROM THE CPFI IS UNFOUNDED .
4 . IS THE ACTION FOR FAILURE TO ACT WELL FOUNDED?
THE APPLICANT HAS ALSO ALLEGED THAT THE HIGH AUTHORITY HAS EXONERATED CERTAIN UNDERTAKINGS IN SO FAR AS THEY CONSUME FERROUS SCRAP FROM WORKS WHICH, WITHOUT BEARING THE SAME COMPANY NAME AS THE CONSUMER WORKS, ARE " LOCALLY INTEGRATED " WITH THE LATTER .
HOWEVER, THE APPLICANT HAS NOT RAISED THE QUESTION WHETHER SUCH EXONERATIONS ARE COMPATIBLE WITH THE PURPOSE AND THE SCHEME OF THE EQUALIZATION SYSTEM .
MOREOVER THAT QUESTION CANNOT BE DECIDED IN THE CONTEXT OF THE PRESENT DISPUTE .
THE FACT THAT THE HIGH AUTHORITY OR ITS DEPARTMENTS MAY, IN CERTAIN CASES, HAVE GIVEN TOO WIDE AN INTERPRETATION OF THE CONCEPT OF " OWN ARISINGS " CANNOT JUSTIFY THE GRANT OF AN EXEMPTION FROM THE LEVY IN OTHER MORE OR LESS COMPARABLE CASES, SINCE SUCH GRANT IS CONTRARY TO THE VERY PRINCIPLES OF THE EQUALIZATION SYSTEM .
ON THOSE GROUNDS, SINCE THE REQUEST FOR EXEMPTION SUBMITTED BY THE APPLICANT IS UNFOUNDED, ITS ACTION FOR FAILURE TO ACT IN RESPECT OF THE IMPLIED DECISION OF REFUSAL MUST BE DISMISSED .
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SECOND PART : CASE 33/58
ADMISSIBILITY
IN THIS CASE THE APPLICANT SEEKS THE ANNULMENT OF THE LETTER FROM THE HIGH AUTHORITY OF 17 APRIL 1958 .
ACCORDING TO ARTICLE 33 OF THE ECSC TREATY, THE APPLICATION IS ONLY ADMISSIBLE IF THAT LETTER CONSTITUTES EITHER AN INDIVIDUAL DECISION CONCERNING THE APPLICANT OR A GENERAL DECISION WHICH THE APPLICANT CONSIDERS TO INVOLVE A MISUSE OF POWERS AFFECTING IT .
FOR THE REASONS EXPLAINED ABOVE, THE LETTER OF 17 APRIL 1958 DOES NOT CONSTITUTE A DECISION WITHIN THE MEANING OF THE TREATY .
THEREFORE THE APPLICATION AGAINST THAT LETTER IS INADMISSIBLE .
Decision on costs
UNDER THE TERMS OF ARTICLE 60 ( 1 ) OF THE RULES OF PROCEDURE OF THE COURT OF JUSTICE OF THE ECSC, THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS .
IN THE PRESENT CASE, THE APPLICANT HAS FAILED IN ALL ITS SUBMISSIONS .
IT MUST THEREFORE BE ORDERED TO BEAR THE COSTS .
Operative part
THE COURT
HEREBY :
1 . IN CASE 32/58 :
1 . DISMISSES THE APPLICATION DIRECTED AGAINST THE IMPLIED DECISION OF REFUSAL RESULTING FROM THE ABSENCE OF A REPLY FOR MORE THAN TWO MONTHS BY THE DEFENDANT TO THE REQUEST FOR EXEMPTION ADDRESSED TO THE OFFICE COMMUN DES CONSOMMATEURS DE FERRAILLE ( JOINT BUREAU OF FERROUS SCRAP CONSUMERS ) AND TO THE CAISSE DE PEREQUATION DES FERRAILLES IMPORTEES ( FERROUS SCRAP EQUALIZATION FUND ) BY THE APPLICANT'S LETTERS OF 31 MARCH 1958 AS UNFOUNDED;
2 . DISMISSES THE APPLICATION DIRECTED AGAINST THE LETTER OF 12 MAY 1958 FROM THE CAISSE DE PEREQUATION DES FERRAILLES IMPORTEES ( IMPORTED FERROUS SCRAP EQUALIZATION FUND ) AS UNFOUNDED;
3 . ORDERS THE APPLICANT TO BEAR THE COSTS .
2 . IN CASE 33/58 :
1 . DISMISSES THE APPLICATION AS INADMISSIBLE;
2 . ORDERS THE APPLICANT TO BEAR THE COSTS .