Judgment — ECLI:EU:T:2017:337
Date: 2017-05-16
Language of the case: German
Court formation: Fourth Chamber, Extended Composition
Subject matter: European Central Bank (ECB);Economic and monetary policy
Procedure: Action for annulment - unfounded
Origin: Germany

summary of the applicant’s arguments. 129 It is also clear that the analysis of the first plea shows that the applicant was able to understand the ECB’s reasoning, since it challenged it through that plea, and that the Court has been able to conduct judicial review of the merits of the reasons in the contested decision. 130 Secondly, regarding the applicant’s assertion alleging insufficiency of the response to its argument put forward during the administrative procedure, it is apparent from paragraphs 87 to 89 and 107 to 108 above that during that procedure the applicant merely attempted to establish that direct prudential supervision by the ECB was not necessary on the ground that supervision by the German authorities would be sufficient in order to attain the objectives of the Basic Regulation, without attempting to show that it would be better able to attain those objectives. Therefore, since that argument is clearly irrelevant in the light of the interpretation favoured by the ECB, it cannot be held that the ECB was bound to provide a detailed statement of reasons for its refutation, as the applicant could easily infer them from the contested decision and the Administrative Board of Review’s Opinion. 131 Thirdly, regarding the applicant’s complaint alleging that the reasons in the contested decision were self-contradictory, it is true that the statement of the reasons for a measure must be logical and contain no internal inconsistency that would prevent a proper understanding of the reasons underlying the measure (judgment of 29 September 2011, Elf Aquitaine v Commission, C‑521/09 P, EU:C:2011:620, paragraph 151). 132 However, it is clear that the statement of reasons in the contested decision is not self-contradictory as alleged. 133 For the reasons set out in paragraphs 31 to 34 above, and contrary to what the applicant appears to argue, there is no contradiction between, on the one hand, the reference in the Administrative Board of Review’s Opinion to the fact that the presence of ‘particular circumstances’ means that the attainment of the objectives of the Basic Regulation, including the need to ensure the consistent application of high prudential supervisory standards, must be better ensured through direct supervision by the national authorities and, on the other, the reference in the contested decision to the fact that direct supervision of the applicant by the ECB must be contrary to the objectives of the Basic Regulation in order for Article 70(1) of the SSM Framework Regulation to apply. 134 Nor is the assertion that the reasons set out in the contested decision were self-contradictory in suggesting that the presence of particular circumstances was sufficient to justify application of Article 70(1) of the SSM Framework Regulation. It was noted in paragraph 99 above that that reason in the contested decision was included merely for the sake of completeness. That passage was therefore not liable to prevent a proper understanding of the criterion applied by the ECB in the contested decision. 135 It follows from the above that the contested decision contains a sufficient statement of reasons. 136 The third plea in law must therefore be rejected. D. The fourth plea: misuse of powers by the ECB in unlawfully failing to exercise its discretion 137 The applicant criticises the ECB for having failed to exercise its discretion in the application of Article 70(1) of the SSM Framework Regulation in respect of it, which amounts to a misuse of powers. It observes that that provision does not contain an exhaustive list of the reasons which the ECB may take into consideration. It was therefore incorrect in finding in the contested decision that the arguments put forward by the applicant led to reasons not provided for in that regulation being taken into account. 138 The ECB, supported by the Commission, contends that this plea should be rejected. 139 Although it is settled case-law that when discretion is conferred on an institution, it must exercise that power fully (see, to that effect, judgments of 14 July 2011, Freistaat Sachsen v Commission, T‑357/02 RENV, EU:T:2011:376, paragraph 45, and of 10 July 2012, Smurfit Kappa Group v Commission, T‑304/08, EU:T:2012:351, paragraph 90). Thus, the Community institutions which have adopted the act in question must be able to show before the Court that in adopting the act they actually exercised their discretion, which presupposes the taking into consideration of all the relevant factors and circumstances of the situation the act was intended to regulate (judgment of 7 September 2006, Spain v Council, C‑310/04, EU:C:2006:521, paragraph 122). 140 However, it should be remembered here that, as pointed out in paragraphs 87 to 89 above, the argument put forward by the applicant during the administrative procedure was intended solely to establish that the objectives of the Basic Regulation could be attained through direct supervision of the applicant by the national authorities and that, for the reasons set out in connection with the analysis of the first plea, such an argument is irrelevant for the application of Article 70(1) of the SSM Framework Regulation. 141 The ECB cannot, therefore, be criticised for having failed to exercise its discretion by rejecting at the outset an argument that is completely irrelevant. 142 The fourth plea must therefore be rejected. E. The fifth plea: infringement of the ECB’s obligation to examine and take into consideration all relevant circumstances of the case 143 The applicant observes that, under Article 28(2) of the SSM Framework Regulation, the ECB must take account of all relevant circumstances. It also refers to the ECB’s obligation to examine and take into consideration, carefully and impartially, all elements of fact and of law that are relevant to the case, which arises from the right to good administration enshrined in Article 41(1) of the Charter of Fundamental Rights of the European Union. 144 It criticises the ECB for having failed to take into account the circumstances alleging: (i) the practical impossibility in which it found itself in dealing with a situation of insolvency; (ii) that it did not meet any of the criteria of Article 6(4) of the Basic Regulation, apart from size; and (iii) that the prudential supervision by the German authorities had not been shown to have any shortcomings in the past. 145 The ECB, supported by the Commission, contends that this plea should be rejected. 146 It is clear from settled case-law that, where the institutions of the European Union have a power of appraisal, respect for the rights guaranteed by the legal order of the European Union in administrative procedures is of even more fundamental importance. 147 The guarantees afforded by EU law in administrative proceedings include, in particular, the principle of sound administration, which is enshrined in Article 41 of the Charter of Fundamental Rights, which entails the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case (judgment of 30 September 2003, Atlantic Container Line and Others v Commission, T‑191/98 and T‑212/98 to T‑214/98, EU:T:2003:245, paragraph 404). 148 That obligation is reiterated in Article 28(2) of the SSM Framework Regulation, which states that, ‘[i]n its assessment, the ECB shall take account of all relevant circumstances’. 149 However, for reasons similar to those set out in paragraph 140 above, it is sufficient to state that the circumstances which the ECB is criticised for having failed to take into account were irrelevant in the light of the wording of Article 70(1) of the SSM Framework Regulation and that, consequently, the ECB cannot be successfully criticised for having failed to take such circumstances into account in the application of that provision. 150 The fifth plea must therefore be rejected as unfounded and, accordingly, the action in its entirety must be dismissed. IV. Costs 151 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the applicant has been unsuccessful, it must be ordered to bear its own costs and to pay those of the ECB in accordance with the latter’s pleadings. 152 In accordance with Article 138(1) of the Rules of Procedure, the institutions which have intervened in the proceedings are to bear their own costs. The Commission must therefore bear its own costs. On those grounds, THE GENERAL COURT (Fourth Chamber, Extended Composition) hereby: 1. Dismisses the action; 2. Orders the Landeskreditbank Baden-Württemberg — Förderbank to bear its own costs and to pay those incurred by the European Central Bank; 3. Orders the European Commission to bear its own costs. Prek Labucka Schwarcz Kreuschitz Schalin Delivered in open court in Luxembourg on 16 May 2017. [Signatures] * Language of the case: German.