Judgment — ECLI:EU:C:2005:452
Date: 2005-07-14
Language of the case: Dutch
Court formation: Second Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Agriculture and Fisheries;Overseas countries and territories;Sugar
Concepts: Association of Overseas Countries and Territories;Statement of reasons
Procedure: Action for annulment - unfounded
Origin: Netherlands

Summary of the Judgment 1. Association of the overseas countries and territories — Safeguard measures — Conditions for establishment — Discretion of the Community institutions — Judicial review — Limits (Council Decision 91/482, Art. 109) 2. Association of the overseas countries and territories — Safeguard measures concerning imports from the overseas countries and territories — Conditions for establishment — Difficulties resulting from the application of Decision 91/482 — Situations requiring the establishment of a causal link (Council Decision 91/482, Art. 109(1)) 3. Association of the overseas countries and territories — Safeguard measures concerning imports from the overseas countries and territories of sugar products with EC/OCT cumulation of origin — Conditions for establishment — Difficulties giving rise to a risk of a greater loss of guaranteed income for Community producers — Manifest error of assessment by the Commission — None (Commission Regulation No 2081/2000) 4. Association of the overseas countries and territories — Safeguard measures concerning imports from the overseas countries and territories –– Safeguard measures which do not put in question the preferential status of goods originating in those countries — Exceptional and temporary nature of those measures (Council Decision 91/482, Art. 109(1)) 5. Association of the overseas countries and territories — Safeguard measures concerning imports from the overseas countries and territories of sugar products with EC/OCT cumulation of origin — Principle of proportionality — Judicial review — Limits (Commission Regulation No 2081/2000) 6. Association of the overseas countries and territories — Safeguard measures concerning imports from the overseas countries and territories of sugar products with EC/OCT cumulation of origin — Requirement of a large sum as security for importation into the Community of sugar of such origin — Security not depriving genuinely interested undertakings of the possibility of exporting sugar to the Community (Commission Regulation No 2081/2000) 7. Acts of the institutions — Statement of reasons — Obligation — Scope — Regulation providing for the continued application of safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin (Art. 253 EC; Commission Regulation No 2081/2000) 1. The Community institutions have a wide discretion in the application of Article 109 of Decision 91/482 on the association of the overseas countries and territories which empowers them to adopt or authorise safeguard measures where certain conditions are met. In those circumstances, the Community Court must restrict itself to considering whether the exercise of that discretion is vitiated by manifest error or misuse of powers and whether the Community institutions clearly exceeded the bounds of their discretion. The scope of the Community Court’s review must be limited in particular if the Community institutions have to reconcile divergent interests and thus to select options within the context of the policy choices which are their own responsibility. (see paras 53-55) 2. On the first hypothesis stated in Article 109(1) of Decision 91/482 on the association of the overseas countries and territories (OCTs) covering the taking of safeguard measures, if, as a result of the application of that decision serious disturbances occur in a sector of the economy of the Community or one or more of its Member States, or their external financial stability is jeopardised, the existence of a causal link must be established because the purpose of the safeguard measures must be to iron out or reduce the difficulties which have arisen in the sector concerned. On the other hand, as regards the second hypothesis stated in that paragraph, under which the Commission may take safeguard measures if difficulties arise which may result in a deterioration in a sector of the Community’s activity or in a region of the Community, it is not a requirement that the difficulties which justify the imposition of a safeguard measure result from the application of the OCT Decision. (see para. 56) 3. The Commission did not make a manifest error of assessment by putting forward as a ground to justify the adoption of Regulation No 2081/2000 providing for the continued application of safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin that the imports in question might have resulted in a greater guaranteed income loss for Community sugar producers. First of all, it is evident that the deterioration or threat of deterioration in the common organisation of the market may necessitate a reduction in the production quotas and thus directly affect the income of Community producers. Next, export refunds are financed in large measure by Community producers through production levies set each year by the Commission. The latter could legitimately find that the imports in question might have resulted in an increase in the volume of subsidised exports and, consequently, a rise in the production levy assumed by Community producers. Lastly, even if certain producers could realise substantial profits on the sale of C sugar to OCT operators by selling at prices much above the world market price, that assertion cannot bring into question the Commission’s assessment that the imports in question might have disturbed the sugar sector, and thus resulted in particular in an increase in the amount of export subsidies or a reduction in production quotas. (see paras 75-79) 4. Article 109 of Decision 91/482 on the association of the overseas countries and territories (OCTs) provides precisely for the possibility of the Commission adopting safeguard measures in the circumstances which it covers. The fact that the Commission adopted such a measure in respect of certain products originating in the OCTs is not such as to put in question the preferential status, under Article 101(1) of that decision, of products originating in those countries, a safeguard measure being, by nature, exceptional and temporary. (see para. 95) 5. As regards judicial review of compliance with the principle of proportionality, bearing in mind the wide discretionary power enjoyed, in particular, by the Commission in matters concerning safeguard measures, the legality of such a measure can be affected only if the measure is manifestly inappropriate in terms of the objective which the competent institution is seeking to pursue. As regards Regulation No 2081/2000 providing for the continued application of safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin, it is not for the Court to establish whether the provision adopted by the Commission is the only or the best measure which could be adopted, but to assess whether it was manifestly inappropriate. In that regard, the applicant has not adduced evidence that the restriction to 4 848 tonnes of the quantity of sugar with EC/OCT cumulation of origin which could be imported into the Community free of customs duties during the period covered by that regulation was manifestly inappropriate in order to attain the objective pursued. (see paras 101-104) 6. In the context of Regulation No 2081/2000 providing for the continued application of safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin, the objective pursued by the Commission, by requiring a large sum as security for the import of such sugar, was to avoid speculation. Such a security does not deprive genuinely interested undertakings of the possibility of exporting sugar to the Community. Whilst the amount of the security must admittedly be paid to obtain the import licences, that sum is reimbursed to the undertaking if the import operation is carried out. (see paras 106-107) 7. The statement of reasons required by Article 253 EC must be appropriate to the nature of the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Community Court to exercise its power of review. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons for a measure meets that article’s requirements must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question. Those requirements are satisfied by Regulation No 2081/2000 providing for the continued application of safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin. In the preamble to that regulation, the Commission explained the difficulties which had persisted since 1997 on the Community sugar market, the reasons for which those difficulties could give rise to deterioration in the functioning of the common organisation of the market and to detrimental effects for Community operators, in view of the reduction in Community production quotas decided in the meantime. The Commission also stated, in that preamble, that the difficulties which led to the adoption of Regulation No 465/2000 introducing safeguard measures for imports from the overseas countries and territories of sugar sector products with EC/OCT cumulation of origin were still continuing, and referred to the reasons which led it to fix the quota at issue. (see paras 122-123)