Judgment — ECLI:EU:T:2017:437
Date: 2017-06-27
Language of the case: English
Subject matter: Public procurement in the European Union
Procedure: Action for annulment - successful
Origin: Spain

Summary — Judgment of the General Court (Ninth Chamber), 27 June 2017 1. EU budget — Financial regulation — Administrative penalties capable of being imposed by the Commission — Modification of the penalty procedure – Immediate application where no transitional provisions (European Parliament and Council Regulation No 966/2012, as amended by Regulation 2015/1929, Arts 105a(2), 106(2), 108, 109(1), and 131(5); Commission Regulation 2015/2462) 2. EU law — Principles — Principle of retroactive application of the lightest penalty — Conditions under which applicable — Adoption of a decision imposing an administrative penalty without taking into consideration the retroactively applicable provisions of a more lenient regime — Not permissible (Charter of Fundamental Rights of the European Union, Art. 49(1); European Parliament and Council Regulation No 966/2012, as amended by Regulation 2015/1929, Art. 106(7)(a); Council Regulation No 2988/95, Art. 2(2)) 1. The rules of procedure apply, in principle, to all proceedings that were pending at the time when they entered into force. It is otherwise only if the new rule is accompanied by special provisions which specifically lay down its conditions of application over time or according to the degree of progress of the procedures concerned. However, in the first case, to apply a new procedural rule to a procedure already commenced under the previous procedural rule, and a fortiorito a completed procedure, could have the result, if that procedure must then be recommenced, of giving retroactive effect to the new procedural rule and not simply applying it to an ongoing situation or to the future effects of a situation arising under the previous rule. In such a case, the application of the new procedural rule results in the retroactive annulment of procedures or procedural steps which complied with the rule in force when they were completed. Regulation 2015/1929, which modified Regulation No 966/2012 on the financial rules applicable to the general budget of the Union with effect from 1 January 2016, does not contain any specific transitional provisions accompanying the fixing of that general application date. In that regard, in the case of an adversarial procedure prior to the adoption of a penalty which was brought by the Commission on the basis of Article 131(5) of Regulation No 966/2012, read in conjunction with Article 109(1) of that regulation in the version applicable until 31 December 2015 and which ended in October 2015, the entire procedure prior to the adoption of the contested decision was properly carried out and completed before 1 January 2016, in the light of the rules applicable to it. The fact that the contested decision was adopted after the implementation of the new version of Regulation No 966/2012, with the introduction of a new panel conducting the adversarial procedure, cannot cast doubt on that assessment. Even if the introduction of that panel was intended to strengthen the rights of the defence of parties contracting with the Union who may be subject to a penalty under the said regulation, no express or implied provision of Regulation 2015/1929 or Regulation 2015/2462, amending Regulation No 1268/2012, can be interpreted as giving Article 105a(2) and Article 106(2) of the Regulation No 966/2012, in the version applicable from 1 January 2016, which provide in a number of cases for the intervention of the said panel, a retroactive scope which would imply recommencing the preliminary procedure completed properly before that date, in particular having regard to compliance with the adversarial principle. (see paras 36-38, 40, 42, 43) 2. The principle of the retroactive application of the more lenient law forms part of the constitutional traditions common to the Member States and, accordingly, must be considered to be one of the general principles of EU law which the Court ensures are respected. It is, more specifically, set out in the second sentence of Article 2(2) of Regulation No 2988/95 on the protection of the European Communities’ financial interests. According to that provision, the competent authorities are required to apply retroactively, to conduct constituting an irregularity, the subsequent amendments made by provisions contained in Union sectoral rules introducing more lenient administrative penalties. In the event of developments in the rules governing administrative penalties, which would lead to certain aspects of the new rules being more lenient, but in other aspects more stringent than the old rules, it is necessary, in order to determine which is the more lenient rule, not to carry out an abstract analysis, but to determine which, in the specific circumstances, is the most favourable to the undertaking in question, having regard to its situation. Article 106(7)(a) of Regulation No 966/2012, on the financial rules applicable to the general budget of the Union, in the version applicable from 1 January 2016, which establishes that an operator that has taken remedial measures demonstrating its reliability cannot be excluded from the contracts and grants of the Union, is clearly a more lenient provision than the previously applicable provision. Where those conditions are met, even if it may require strict proof, it is now possible to obtain a full exemption from an exclusion penalty, whereas previously that did not necessarily result in such an exemption. The Court must therefore annul a Commission decision imposing an administrative penalty excluding an undertaking from procurement and grant award procedures financed by the general budget of the European Union, where such a decision is adopted without any indication that consideration was given to the provisions of a more lenient sanctions regime which, if applied retroactively to the facts of the case, could have resulted in a more lenient decision. (see paras 53-55, 57, 63)