# C_2011232EN.01003302.xml

| 6.8.2011 | EN | Official Journal of the European Union | C 232/33 |
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6.8.2011

EN

Official Journal of the European Union

C 232/33

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Action brought on 30 May 2011 — T&L Sugars and Sidul Açúcares/Commission

(Case T-279/11)

(2011/C 232/60)

Language of the case: English

Parties

Applicants: T&L Sugars Ltd (London, United Kingdom) and Sidul Açúcares, Unipessoal Lda (Santa Iria de Azóia, Portugal) (represented by: D. Waelbroeck, lawyer, and D. Slater, Solicitor)

Defendant: European Commission

Form of order sought

| — | Declare the present application for annulment under Article 263(4) TFUE and/or plea of illegality under Article 277 TFUE against Regulation 222/2011, Regulation 293/2011, Regulation 302/2001 and Regulation 393/2011 admissible and well founded; |
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Declare the present application for annulment under Article 263(4) TFUE and/or plea of illegality under Article 277 TFUE against Regulation 222/2011, Regulation 293/2011, Regulation 302/2001 and Regulation 393/2011 admissible and well founded;

| — | Annulment of Regulation 222/2011 laying down exceptional measures as regards the release of out-of-quota sugar and isoglucose on the Union market at reduced surplus levy during marketing year 2010/2011; |
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Annulment of Regulation 222/2011 laying down exceptional measures as regards the release of out-of-quota sugar and isoglucose on the Union market at reduced surplus levy during marketing year 2010/2011;

| — | Annulment of Regulation 293/2011 fixing allocation coefficient, rejecting further applications and closing the period for submitting applications for available quantities of out-of-quota sugar to be sold on the Union market at reduced surplus levy; |
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Annulment of Regulation 293/2011 fixing allocation coefficient, rejecting further applications and closing the period for submitting applications for available quantities of out-of-quota sugar to be sold on the Union market at reduced surplus levy;

| — | Annulment of Regulation 302/2001 opening an exceptional import tariff quota for certain quantities of sugar in the 2010/11 marketing year; and |
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Annulment of Regulation 302/2001 opening an exceptional import tariff quota for certain quantities of sugar in the 2010/11 marketing year; and

| — | Annulment of Regulation 393/2011 fixing the allocation coefficient for the issuing of import licences applied for from 1 to 7 April 2011 for sugar products under certain tariff quotas and suspending submission of applications for such licences; |
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Annulment of Regulation 393/2011 fixing the allocation coefficient for the issuing of import licences applied for from 1 to 7 April 2011 for sugar products under certain tariff quotas and suspending submission of applications for such licences;

| — | In the alternative, declare the plea of illegality against Articles 186(a) and 187 of Regulation 1234/2007 admissible and well founded and declare those provisions illegal, as well as annul the contested regulations, which are directly or indirectly based on those provisions; |
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In the alternative, declare the plea of illegality against Articles 186(a) and 187 of Regulation 1234/2007 admissible and well founded and declare those provisions illegal, as well as annul the contested regulations, which are directly or indirectly based on those provisions;

| — | Condemn the EU as represented by the Commission to repair any damage suffered by the Applicants as a result of the Commission’s breach of its legal obligations and to set the amount of this compensation for the damage suffered by the Applicants during the period 1 October 2009 to 31 March 2011 at 35,485,746 EUR plus any ongoing losses suffered by the Applicants after that date or any other amount reflecting the damage suffered or to be suffered by the Applicants as further established by them in the course of this procedure especially to take due account of future damage; |
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Condemn the EU as represented by the Commission to repair any damage suffered by the Applicants as a result of the Commission’s breach of its legal obligations and to set the amount of this compensation for the damage suffered by the Applicants during the period 1 October 2009 to 31 March 2011 at 35,485,746 EUR plus any ongoing losses suffered by the Applicants after that date or any other amount reflecting the damage suffered or to be suffered by the Applicants as further established by them in the course of this procedure especially to take due account of future damage;

| — | Order an interest at the rate set at the time by the European Central bank for main refinancing operations, plus two percentage points, or any other appropriate rate to be determined by your Court, be paid on the amount payable as from the date of your Court’s judgement until actual payment; |
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Order an interest at the rate set at the time by the European Central bank for main refinancing operations, plus two percentage points, or any other appropriate rate to be determined by your Court, be paid on the amount payable as from the date of your Court’s judgement until actual payment;

| — | Order the Commission to pay all costs and expenses in these proceedings. |
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Order the Commission to pay all costs and expenses in these proceedings.

Pleas in law and main arguments

In support of the action, the applicants rely on five pleas in law.

| 1. | First plea in law, alleging a violation of Regulation No 1234/2007 (1) and absence of adequate legal basis. In violation of Regulation No 1234/2007, the contested Regulation No 222/2011 effectively increases the production quotas granted to domestic producers. According to the applicants, the commission has no such power and is explicitly mandated to reduce production quotas. Yet to achieve an equivalent result, and not withstanding the Commission’s legal obligation to impose a surplus levy at a dissuasive level, Regulation No 222/2011 illegally sets the surplus levy on out-of-quota sugar at 0 EUR. Moreover in seeking to correct market disturbances caused by a shortfall of imports, both Regulation No 222/2011 and Regulation No 302/2011 ignore the priority legally granted under Regulation No 1234/2007 to import measures and full-time refiners. |
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1.

First plea in law, alleging a violation of Regulation No 1234/2007 (1) and absence of adequate legal basis. In violation of Regulation No 1234/2007, the contested Regulation No 222/2011 effectively increases the production quotas granted to domestic producers. According to the applicants, the commission has no such power and is explicitly mandated to reduce production quotas. Yet to achieve an equivalent result, and not withstanding the Commission’s legal obligation to impose a surplus levy at a dissuasive level, Regulation No 222/2011 illegally sets the surplus levy on out-of-quota sugar at 0 EUR. Moreover in seeking to correct market disturbances caused by a shortfall of imports, both Regulation No 222/2011 and Regulation No 302/2011 ignore the priority legally granted under Regulation No 1234/2007 to import measures and full-time refiners.

| 2. | Second plea in law, alleging a violation of the non-discrimination principle. The applicants submit that despite the chemical identity of cane and beet based sugar, the contested regulations favour domestic producers to the detriment of importing refiners. |
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2.

Second plea in law, alleging a violation of the non-discrimination principle. The applicants submit that despite the chemical identity of cane and beet based sugar, the contested regulations favour domestic producers to the detriment of importing refiners.

| 3. | Third plea in law, alleging a violation of the principle of proportionality. The contested regulations are aimed at tackling a shortage on the EU sugar market caused by a deficit of imported raw cane sugar. However, instead of remedying the problem by allowing the necessary imports of raw cane sugar, they increased the possibilities of domestic sugar production. As a result they are manifestly inappropriate and disproportionate. |
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3.

Third plea in law, alleging a violation of the principle of proportionality. The contested regulations are aimed at tackling a shortage on the EU sugar market caused by a deficit of imported raw cane sugar. However, instead of remedying the problem by allowing the necessary imports of raw cane sugar, they increased the possibilities of domestic sugar production. As a result they are manifestly inappropriate and disproportionate.

| 4. | Fourth plea in law, alleging an infringement of the principle of legitimate expectations. According to the applicants, the Commission gave repeated assurances that it will not increase the production quota and will maintain the balance between stakeholders. The contested regulations were however clearly designed to favour domestic production at the expense of importing refiners. |
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4.

Fourth plea in law, alleging an infringement of the principle of legitimate expectations. According to the applicants, the Commission gave repeated assurances that it will not increase the production quota and will maintain the balance between stakeholders. The contested regulations were however clearly designed to favour domestic production at the expense of importing refiners.

| 5. | Fifth plea in law, alleging a violation of the principles of diligence, care and good administration. The applicants submit that the Commission failed in the first instance to act at all, despite repeated warnings of market disturbances, then went on to adopt manifestly inappropriate measures to tackle those disturbances, and in doing so upset the balance established by the Council between the different market operators. |
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5.

Fifth plea in law, alleging a violation of the principles of diligence, care and good administration. The applicants submit that the Commission failed in the first instance to act at all, despite repeated warnings of market disturbances, then went on to adopt manifestly inappropriate measures to tackle those disturbances, and in doing so upset the balance established by the Council between the different market operators.

The applicants invoke the above grounds for annulment also against Regulation No 222/2011 and Regulation No 302/2011 as a plea of illegality on the basis of Article 277 TFUE. In the alternative, the applicants raise also a plea of illegality under Article 277 TFUE against Articles 186a and 187 of Regulation No 1234/2007, on which the contested regulations are based

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(1)  Council Regulation (EC) No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (Single CMO Regulation) (OJ L 299, p. 1).

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