Information;Order — ECLI:EU:T:2021:733
Date: 2021-10-25
Language of the case: English
Court formation: President of the Chamber
Subject matter: Public health
Procedure: Action for annulment;Application for interim measures - successful
Origin: Netherlands

ORDER OF THE PRESIDENT OF THE GENERAL COURT 25 October 2021 (*) (Interim measures – Biocidal products – Implementing Regulation (EU) 2021/348 – Approval of carbendazim as an existing active substance for use in biocidal products of product-types 7 (film preservatives) and 10 (masonry preservatives) – Application for suspension of operation of a measure – No urgency) In Case T‑297/21 R, Troy Chemical Company BV, established in Delft (Netherlands), Troy Corp., established in Florham Park, New Jersey (United States), represented by D. Abrahams, H. Widemann and L. Gorywoda, lawyers, applicants, v European Commission, represented by R. Lindenthal and M. Farley, acting as Agents, defendant, APPLICATION under Articles 278 and 279 TFEU seeking, first, suspension of operation of Commission Implementing Regulation (EU) 2021/348 of 25 February 2021 approving carbendazim as an existing active substance for use in biocidal products of product-types 7 and 10 (OJ 2021 L 68, p. 174), and, second, the grant of any other interim measures which the General Court considers appropriate, THE PRESIDENT OF THE GENERAL COURT makes the following Order Background to the dispute, procedure and forms of order sought by the parties 1 The first applicant, Troy Chemical Company BV, is a company incorporated under Netherlands law which places biocidal products on the EU market, in particular film preservatives and masonry preservatives containing carbendazim, and the second applicant, Troy Corp., which is a company incorporated under the law of the State of Delaware (United States), is [confidential]. 2 Biocidal products are necessary for the control of organisms that are harmful to human or animal health and for the control of organisms that cause damage to natural or manufactured materials. However, biocidal products can pose risks to humans, animals and the environment due to their intrinsic properties and associated use patterns. 3 As an existing active substance in biocidal products, carbendazim is a systemic fungicide with a protective action which inhibits the development of the germ tubes, the formation of appressoria and the growth of mycelia. 4 After being notified as an existing active substance, carbendazim was included, in 2003, in the review programme provided for by Commission Regulation (EC) No 2032/2003 of 4 November 2003 on the second phase of the 10-year work programme referred to in Article 16(2) of Directive 98/8/EC of the European Parliament and of the Council concerning the placing of biocidal products on the market, and amending Regulation (EC) No 1896/2000 (OJ 2003 L 307, p. 1), and, more recently, in Annex II to Commission Delegated Regulation (EU) No 1062/2014 of 4 August 2014 on the work programme for the systematic examination of all existing active substances contained in biocidal products referred to in Regulation (EU) No 528/2012 of the European Parliament and of the Council (OJ 2014 L 294, p. 1), which contains the list of the existing active substances to be evaluated for their possible approval for use in biocidal products. 5 Carbendazim has been evaluated for use in biocidal products of product-types 7 (film preservatives) and 10 (masonry preservatives), as described in Annex V to Directive 98/8/EC of the European Parliament and of the Council of 16 February 1998 concerning the placing of biocidal products on the market (OJ 1998 L 123, p. 1), which correspond, respectively, to product-types 7 and 10 as described in Annex V to Regulation (EU) No 528/2012 of the European Parliament and of the Council of 22 May 2012 concerning the making available on the market and use of biocidal products (OJ 2012 L 167, p. 1). 6 The evaluating competent authority, in this instance the Federal Republic of Germany, submitted the assessment reports together with its conclusions to the Commission on 2 August 2013. 7 On 20 March 2018, in its revised version of the assessment report, the evaluating competent authority expressed its concerns about the unacceptable effects of carbendazim on the environment in respect of the outdoor use of paints (product-type 7) and plasters (product-type 10). 8 On 10 December 2019, in accordance with Article 7(2) of Delegated Regulation No 1062/2014, the opinions of the European Chemicals Agency (ECHA) were adopted by the Biocidal Products Committee, having regard to the conclusions of the evaluating competent authority. 9 According to the opinions of ECHA, biocidal products of product-types 7 and 10 containing carbendazim may be expected to satisfy the requirements set out in Article 5 of Directive 98/8, provided that certain specifications and conditions concerning their use are complied with. In its opinions, ECHA also concludes that carbendazim meets the criteria for being a persistent and toxic substance in accordance with Annex XIII to Regulation (EC) No 1907/2006 of the European Parliament and of the Council of 18 December 2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), establishing a European Chemicals Agency, amending Directive 1999/45/EC and repealing Council Regulation (EEC) No 793/93 and Commission Regulation (EC) No 1488/94 as well as Council Directive 76/769/EEC and Commission Directives 91/155/EEC, 93/67/EEC, 93/105/EC and 2000/21/ECC (OJ 2006 L 396, p. 1). ECHA also concluded in its opinions that the outdoor use of paints and plasters treated with or incorporating carbendazim posed unacceptable risks for surface water and sediment during their service life. No adequate risk-mitigation measure could be identified to avoid releases of carbendazim in sewers during the service life of such treated articles when used outdoors. 10 On 23 September 2020, at a meeting of the Standing Committee on Biocidal Products (‘the Standing Committee’), it was discussed whether the draft which led to the adoption of Commission Implementing Regulation (EU) 2021/348 of 25 February 2021 approving carbendazim as an existing active substance for use in biocidal products of product-types 7 and 10 (OJ 2021 L 68, p. 174; ‘the contested regulation’) should provide for restrictions on the use of biocidal products and the Commission announced that it would present a new version of the contested regulation which would include such restrictions. 11 On 26 November 2020, the European Parliament adopted a resolution on the draft contested regulation approving carbendazim as an existing active substance for use in biocidal products of product-types 7 and 10 (D069099/01 – 2020/2852(RSP)), in which it considered that that draft regulation was not compatible with the aim and content of Directive 98/8 and that it was not proportionate in the light of the unacceptable risks that it was likely to entail for human health and the environment. 12 On 10 December 2020, at the Standing Committee meeting, the revised draft contested regulation was made available to the Member States and was discussed. 13 On 5 February 2021, the Standing Committee delivered a positive opinion on the revised draft contested regulation. 14 On 25 February 2021, the Commission adopted the contested regulation, by which it approved, subject to certain specifications and conditions, carbendazim as an active substance for use in biocidal products of product-types 7 and 10. 15 By application lodged at the Court Registry on 21 May 2021, the applicants brought an action seeking, inter alia, annulment of the contested regulation. 16 By separate document lodged at the Court Registry on 18 June 2021, the applicants brought the present application for interim measures, in which they claim that the President of the General Court should: – suspend the contested regulation with immediate effect, pursuant to Article 157(2) of the Rules of Procedure of the General Court, pending the decision in respect of this application for interim measures; – order the suspension of the contested regulation pending the Court’s ruling on the main action; – grant any other interim measures as appropriate and hold an oral hearing as needed; – order the Commission to pay the costs of these proceedings. 17 In its observations on the application for interim measures, which were lodged at the Court Registry on 19 July 2021, the Commission contends that the President of the General Court should: – dismiss the application for interim measures; and – reserve the costs. Law 18 It is apparent from Articles 278 and 279 TFEU, read in conjunction with Article 256(1) TFEU, that the judge hearing an application for interim measures may, if he or she considers that the circumstances so require, order that the operation of a measure challenged before the General Court be suspended or prescribe any necessary interim measures, pursuant to Article 156 of the Rules of Procedure. Nevertheless, Article 278 TFEU establishes the principle that actions do not have suspensory effect, since acts adopted by the institutions of the European Union are presumed to be lawful. It is therefore only exceptionally that the judge hearing an application for interim measures may order the suspension of operation of an act challenged before the General Court or prescribe any interim measures (order of 19 July 2016, Belgium v Commission, T‑131/16 R, EU:T:2016:427, paragraph 12). 19 The first sentence of Article 156(4) of the Rules of Procedure provides that applications for interim measures must state ‘the subject matter of the proceedings, the circumstances giving rise to urgency and the pleas of fact and law establishing a prima facie case for the interim measure applied for’. 20 Accordingly, the judge hearing an application for interim relief may order suspension of operation of an act and other interim measures if it is established that such an order is justified, prima facie, in fact and in law, and that it is urgent in so far as, in order to avoid serious and irreparable harm to the applicant’s interests, it must be made and produce its effects before a decision is reached in the main action. Those conditions are cumulative and, consequently, an application for interim measures must be dismissed if any one of them is not satisfied. Where appropriate, the judge hearing an application for interim measures must also weigh the interests involved (see order of 2 March 2016, Evonik Degussa v Commission, C‑162/15 P‑R, EU:C:2016:142, paragraph 21 and the case-law cited). 21 In the context of that overall examination, the judge hearing the application for interim measures enjoys broad discretion and remains free to determine, having regard to the specific circumstances of the case, the manner and order in which those various conditions are to be examined, there being no rule of law imposing a pre-established scheme of analysis within which the need to order interim measures must be assessed (see order of 19 July 2012, Akhras v Council, C‑110/12 P(R), not published, EU:C:2012:507, paragraph 23 and the case-law cited). 22 Having regard to the material in the case file, the President of the General Court considers that he has all the information needed to rule on the present application for interim measures without there being any need first to hear oral argument from the parties. 23 In the circumstances of the present case, it is appropriate to examine first whether the condition relating to urgency is satisfied. 24 In order to determine whether the interim measures sought are urgent, it should be noted that the purpose of the procedure for interim relief is to guarantee the full effectiveness of the future final decision, in order to prevent a lacuna in the legal protection afforded by the EU Courts (order of 14 January 2016, AGC Glass Europe and Others v Commission, C‑517/15 P‑R, EU:C:2016:21, paragraph 27). 25 To attain that objective, urgency must, generally, be assessed in the light of the need of an interlocutory order to avoid serious and irreparable harm to the party requesting the interim measure. That party must demonstrate that it cannot await the outcome of the main proceedings without suffering serious and irreparable harm (see order of 14 January 2016, AGC Glass Europe and Others v Commission, C‑517/15 P‑R, EU:C:2016:21, paragraph 27 and the case-law cited). 26 It is in the light of those criteria that it should be examined whether the applicants have managed to demonstrate urgency. 27 In the present case, in order to demonstrate the serious and irreparable nature of the harm, the applicants claim, in the first place, [confidential]. 28 In the second place, the applicants claim that the contested regulation will have a domino effect, given that the authorities of non-EU countries are likely to lay down similar specific conditions as regards carbendazim-based products. 29 In the third place, the applicants claim that the late inclusion in the draft contested regulation, in the travaux préparatoires, of the conditions applied to carbendazim should be regarded as a random and unforeseeable event, since there were no signs that the Commission would attach specific conditions to its approval. According to the applicants, they were unable to anticipate that prohibition, since it runs counter to the scientific evidence available and since they learned of the Commission’s intention to introduce the restrictions at issue only three months before the adoption of the contested regulation. Consequently, although they have a specific business strategy countering a potential regulatory risk, the fact that the Commission’s intention to introduce restrictions was made public only three months before the contested regulation was adopted prevented the applicants from adapting to the imminent regulatory change. 30 In the fourth place, the applicants claim that they will not be able to recover their lost market share, since their competitors have a number of functional alternative products and the applicants’ customers are very likely to switch permanently to those competing products. 31 In the fifth place, the applicants submit that an action for damages under Articles 268 and 340 TFEU could not adequately compensate for the harm suffered. 32 The Commission, by contrast, considers that the applicants have failed to establish the urgency of the suspension of operation sought. 33 In the first place, as regards the applicants’ argument that [confidential], it must be stated at the outset that the harm invoked in that respect is of a financial nature. 34 Regarding the seriousness of the financial harm alleged, it is settled case-law that the interim measure sought will be justified only if it appears that, without such a measure, the party seeking it would be in a position that could imperil its existence before the final decision in the main action. In that regard, it is settled case-law that the assessment of the serious nature of such harm is carried out in the light of, inter alia, the size and turnover of the undertaking and the characteristics of the group to which it belongs (see order of 21 January 2019, Agrochem-Maks v Commission, T‑574/18 R, EU:T:2019:25, paragraphs 33 and 34 and the case-law cited). 35 In order to determine whether these conditions are satisfied, the judge hearing the application for interim measures must, according to well-established case-law, have specific and precise information, supported by detailed, certified documentary evidence, which shows the situation in which the party seeking the interim measures finds itself and enables the probable consequences, should the measures sought not be granted, to be assessed (see order of 10 July 2018, Synergy Hellas v Commission, T‑244/18 R, not published, EU:T:2018:422, paragraph 27 and the case-law cited). It follows that that party must provide essential evidence enabling the judge hearing the application for interim measures to establish an accurate overall picture of its financial situation and that of the shareholders controlling it (see, to that effect, order of 20 April 2012, Fapricela v Commission, C‑507/11 P(R), not published, EU:C:2012:231, paragraph 35 and the case-law cited). Furthermore, the second sentence of Article 156(4) of the Rules of Procedure expressly provides that an application for interim measures must contain all the evidence and offers of evidence available to justify the grant of the interim measures requested. 36 Moreover, as regards a loss corresponding to a share of less than 10% of the turnover of undertakings active on highly regulated markets, it is settled case-law that the financial difficulties which those undertakings risk suffering do not appear to be such as to threaten their very existence (order of 15 November 2011, Xeda International v Commission, T‑269/11 R, not published, EU:T:2011:665, paragraph 21; see also, to that effect, order of 11 April 2001, Commission v Bruno Farmaceutici and Others, C‑474/00 P(R), EU:C:2001:219, paragraph 106). As regards a loss representing nearly two thirds of the turnover of such undertakings, while acknowledging that the financial difficulties they undergo may be such as to threaten their existence, the case-law underlines that, in a highly regulated sector where major investment is often required and the competent authorities may be led to intervene when public health risks become apparent, for reasons which cannot always be foreseen by the undertakings concerned, it is for those undertakings, if they are not to bear themselves the loss resulting from such intervention, to protect themselves against its consequences by adopting an appropriate policy (see orders of 16 June 2016, ICA Laboratories and Others v Commission, C‑170/16 P(R), not published, EU:C:2016:462, paragraph 29 and the case-law cited, and of 8 June 2020, Ascenza Agro and Industrias Afrasa v Commission, T‑77/20 R, not published, EU:T:2020:246, paragraph 56 and the case-law cited). 37 In the present case, the applicants do not claim that they are in a situation that could threaten their very existence. 38 As is apparent from the file, [confidential]. 39 As regards the second applicant, the applicants state that the financial impact of the contested regulation is significant [confidential]. 40 In the light of those data, it must be held that [confidential]. In those circumstances, the data provided by the applicants do not enable the Court to assess the financial impact of the contested regulation and the resulting risk to the applicants’ financial viability. 41 In addition, it must be noted that, in accordance with the case-law referred to in paragraph 35 above, in order to demonstrate a risk to their financial viability, the applicants should have produced, with supporting documentation, an accurate overall picture of their financial situation and that of the shareholders controlling them. 42 Since the applicants have not provided any source demonstrating the veracity or accuracy of the figures relating to the alleged losses or communicated any data on the financial capacity of the entire group, beyond the first and second applicants, it must be stated, as the Commission has observed, that the evidence submitted is not sufficiently reliable to establish with certainty that the alleged harm, as estimated by the applicants, is factually correct or that the second applicant could not have acted to mitigate those losses. 43 Accordingly, it must be held that the applicants have failed to demonstrate urgency based on a risk to their financial viability. 44 In any event, it must be stated that the harm alleged [confidential]. 45 In the second place, as regards the applicants’ argument that the contested regulation will have a domino effect, given that the authorities of non-EU countries are likely to lay down similar specific conditions as regards carbendazim-based products, first, it should be noted that, in general, the reduction of sales in non-EU countries attributable to the adoption of a decision banning or restricting the use of a substance because some non-EU countries might follow the EU rules cannot be taken into account in the assessment of the seriousness of the alleged damage, since such measures would be the direct consequence not of the contested regulation, but of a decision taken by the authorities of each non-EU country in the exercise of their absolute discretion (see, to that effect, order of 12 October 2018, Taminco v EFSA, T‑621/17 R, EU:T:2018:763, paragraph 65 (not published) and the case-law cited). 46 Second, it should be noted that the applicants have not established that the provisional measure sought, assuming that it is granted, would prevent the authorities of non-EU countries from adopting measures similar to the specific conditions laid down in the contested regulation. As a result, they have not shown that suspension of operation of the contested regulation would be such as to prevent the alleged harm caused, where appropriate, on the market in non-EU countries (see, to that effect, order of 12 October 2018, Taminco v EFSA, T‑621/17 R, EU:T:2018:763, paragraph 66 (not published) and the case-law cited). 47 It follows from the foregoing that the consequences the applicants envisage for their business, linked to the fact that the authorities of non-EU countries would adopt measures similar to the specific conditions set out in the contested regulation, do not constitute a special circumstance enabling a conclusion as to the seriousness of the damage. 48 In the third place, as regards the argument that the late inclusion in the draft of the contested regulation, during the travaux préparatoires, of the conditions applied to carbendazim should be regarded as a random and unforeseeable event, it must be noted that the applicants operate on a highly regulated market. As noted in paragraph 36 above, it was therefore incumbent on the applicants to behave in such a way as to take into account the increased risk of a ban on the marketing of their product, in terms of having to bear the loss arising from such a ban. Consequently, the judge hearing the application for interim measures should, in his or her analysis of the seriousness of the alleged harm, take into account the applicants’ business strategy (see, to that effect, order of 21 January 2019, Agrochem-Maks v Commission, T‑574/18 R, EU:T:2019:25, paragraph 46). 49 In the present case, it must be stated, as the Commission noted, that, even though the recommendation of the Biocidal Products Committee did not contain a specific restriction relating to paints and plasters intended to be used outdoors, but only a requirement that particular attention be paid to them, concerns regarding the ‘unacceptable risks’ to the environment of that outdoor use had already been expressed in the revised version of the assessment report of 20 March 2018 of the Federal Republic of Germany, as the evaluating competent authority. Those concerns were also expressed, inter alia, in the interim opinions of the Biocidal Products Committee of 25 April 2018, in the opinions of the Biocidal Products Committee of 10 December 2019 and in the minutes of the meeting of the Biocidal Products Committee of 10 and 11 December 2019. In addition, at the meeting of the Standing Committee on 23 September 2020, the issue of whether the contested regulation should provide for restrictions on the use of biocidal products was discussed. At that meeting, the Commission announced that it would present a new version of the draft contested regulation which would include such restrictions. At the meeting of that committee held on 10 December 2020, a new version of the draft contested regulation, which contained provisions laying down the restrictions on use at issue, was made available to the Member States. 50 In addition, it should be noted that, since the adoption of Regulation (EC) No 1272/2008 of the European Parliament and of the Council of 16 December 2008 on classification, labelling and packaging of substances and mixtures, amending and repealing Directives 67/548/EEC and 1999/45/EC, and amending Regulation (EC) No 1907/2006 (OJ 2008 L 353, p. 1), carbendazim has been subject to a harmonised classification as a Category 1B mutagenic substance and Category 1B reproductive toxicant, in accordance with Part 3 of Annex VI to that regulation. 51 Moreover, since the first applicant had carefully followed the travaux préparatoires for the contested regulation, including as a point of contact for the evaluating competent authority, ECHA and the Commission throughout the procedure which led to the adoption of the contested regulation, the applicants could have anticipated that the Commission would not, in all likelihood, unconditionally approve carbendazim as an existing active substance for use in biocidal products of product-types 7 and 10. 52 Thus, the applicants, as responsible, informed and diligent operators, should have taken in good time all the measures necessary to reduce their economic dependence on carbendazim, by diversifying their product range or by taking other measures to mitigate compliance risks. 53 Consequently, in so far as the applicants may not have sufficiently diversified their activities or taken risk-mitigation measures in good time, they cannot claim that the amendments made to the draft contested regulation should be regarded as a random and unforeseeable event. 54 In the fourth place, as regards the applicants’ argument that they will not be able to recover lost market share, since their competitors have a number of functional alternative products and their customers are very likely to switch permanently to those competing products, it must be stated at the outset that the applicants have not quantified the potential reduction in their market share. Although they make statements concerning estimated turnover reductions, the application for interim measures does not clearly show the loss in turnover which the second applicant would suffer exclusively at European level and does not state whether those figures relate solely to outdoor use of paints (product-type 7) and plasters (product-type 10) or whether they also relate to indoor use. In addition, the application for interim measures does not specify how that loss of turnover would have an impact on market share. 55 Furthermore, the applicants have not demonstrated that, in the event of annulment of the contested regulation, the presence of obstacles of a structural or legal nature would prevent them from regaining their market share (see, to that effect, order of 4 April 2006, Vischim v Commission, T‑420/05 R, not published, EU:T:2006:102, paragraph 76). 56 In addition, it should be recalled that carbendazim was approved by the contested regulation as an active substance for use in biocidal products of product-types 7 and 10, subject to the specifications and conditions set out in the annex to that regulation. The application, in the contested regulation, of conditions on the authorisation of biocidal products of product-types 7 and 10 incorporating carbendazim does not mean, however, that such products that are already on the market must immediately be withdrawn. Pursuant to the annex to the contested regulation, the approval date is set at 1 February 2022 and the Member States have until 31 January 2025 to take the appropriate measures concerning applications for the authorisation of biocidal products which contain no active substances other than carbendazim or which contain carbendazim and other already approved active substances, provided that such applications for authorisation are submitted no later than the date of approval of carbendazim, pursuant to the second subparagraph of Article 89(3) of Regulation No 528/2012. 57 It is therefore apparent that the applicants’ situation will not change until the national authorisations for biocidal products have been amended in the Member States in which the first applicant holds authorisations or places biocidal products on the market in accordance with the national rules applicable to the uses concerned. 58 In the fifth place, as regards the applicants’ claim that their losses could not be compensated for by means of an action for damages, it is not apparent from their pleadings that, in view of its nature and the manner in which it will foreseeably occur, the harm alleged, should it occur, may not be adequately identified and quantified and that, in practice, it will not therefore be possible to make good that harm by bringing an action for damages (see, to that effect, order of 22 June 2018, Arysta LifeScience Netherlands v Commission, T‑476/17 R, EU:T:2018:407, paragraph 94 and the case-law cited). 59 Although the applicants consider that it might not be possible to compensate for the alleged harm, they do not provide any evidence in support of their claim that financial compensation would not in itself be sufficient to constitute restitutio in integrum. 60 It follows that the applicants have not established either the serious or the irreparable nature of the harm alleged. 61 It follows from all of the above that the application for interim relief must be dismissed, as the applicants have failed to establish urgency, without it being necessary to rule on the prima facie case or to weigh up the interests. 62 By virtue of Article 158(5) of the Rules of Procedure, it is appropriate to reserve the costs. On those grounds, THE PRESIDENT OF THE GENERAL COURT hereby orders: 1. The application for interim measures is dismissed. 2. The costs are reserved. Luxembourg, 25 October 2021. E. Coulon M. van der Woude Registrar President * Language of the case: English.