JUDGMENT OF THE GENERAL COURT (Fourth Chamber)
23 October 2024 (*)
( Civil service – Officials – Leave on personal grounds – Commission decision imposing restrictions on engaging in an outside activity – Obligation to state reasons – Proportionality – Equal treatment )
In Case T‑689/22,
SN, represented by L. Levi and P. Baudoux, lawyers,
applicant,
v
European Commission, represented by T. Bohr, acting as Agent,
defendant,
THE GENERAL COURT (Fourth Chamber),
composed of R. da Silva Passos, President, N. Półtorak (Rapporteur) and T. Pynnä, Judges,
Registrar: S. Spyropoulos, Administrator,
having regard to the written part of the procedure,
further to the hearing on 1 February 2024,
gives the following
Judgment
1        By his action based on Article 270 TFEU, the applicant, SN, seeks annulment of the European Commission’s decision of 11 January 2022 imposing on him restrictions on engaging in an outside activity during his leave on personal grounds (‘the contested decision’) and the decision of 27 July 2022 rejecting his complaint (‘the decision rejecting the complaint’).
Background to the dispute
2        The applicant has been an established official in the Commission’s
Directorate-General (DG) for Competition since 16 March 2016. Previously, he had, since 16 November 2011, been working there as a member of the temporary staff.
3        Since 1 March 2019, the applicant has been on leave on personal grounds and joined an economic consultancy firm (‘the consultancy firm’) as Vice-President in order to provide economic advice to undertakings in the field of competition. Every year since 2019, the applicant has requested from the Commission, in that context, permission to engage in an outside activity, which he has been granted.
4        By a memorandum of 23 July 2021, the Director-General of the Commission’s Directorate-General for Human Resources invited the appointing authorities of each Directorate-General to adopt a stricter approach to the granting of permission to members of staff on leave on personal grounds for the purposes of activities outside the institution to which they belong. Following that memorandum, by email of 12 November 2021, the Director-General of DG Competition sent the applicant further details on the application of Articles 12b and 40 of the Staff Regulations of Officials of the European Union (‘the Staff Regulations’). In particular, he stated that activities carried out during leave on personal grounds that entail representing private interests before the Commission put the officials concerned in a situation of perceived conflict of interest, especially where the activity in question takes place in the same area of expertise as the one in which the official worked at the Commission (‘the email of 12 November 2021’).
5        On 30 November 2021, the applicant requested
permission to extend his outside activity during his leave on personal grounds.
6        On 11 January 2022, the Commission granted the applicant permission to engage in that outside activity, while imposing on him certain restrictions, including a prohibition on being involved, participating and advising in proceedings and cases
handled by the European Commission and before the Courts of the European Union or on entering into any direct or indirect, including written, professional contact with the relevant services at the Commission in the context of his work at the consultancy firm (‘the restrictions in question’).
7        On 29 March 2022, the applicant lodged a complaint, which was rejected by the decision rejecting the complaint.
Forms of order sought
8        The applicant claims that the Court should:
–        annul the contested decision in so far as it imposes the restrictions in question;
–        annul the decision rejecting the complaint;
–        order the Commission to pay the costs.
9        The Commission contends that the Court should:
–        dismiss the action;
–        order the applicant to pay the costs.
Law
10      In support of his action, the applicant relies on three pleas in law, the first alleging breach of the obligation to state reasons, the second alleging infringement of Article 40 of the Staff Regulations, Commission Decision C(2018)
4048 final of 29 June 2018 on outside activities and assignments and on occupational activities after leaving the Service (‘Decision C(2018) 4048’) and breach of the principle of proportionality, and the third alleging breach of the principle of equal treatment.
Subject matter of the dispute
11      The applicant seeks annulment of the contested decision imposing the restrictions in question in respect of engaging in an outside activity permitted in the context of his leave on personal grounds and of the decision rejecting the complaint.
12      It is apparent from the case-law in that regard that, as to the claim directed against the decision rejecting the complaint, an administrative complaint, as provided for in Article 90(2) of the Staff Regulations, and its rejection, whether express or implied, constitute an integral part of a complex procedure and are no more than a precondition for bringing the matter before the Courts. Accordingly, an action before the Courts, even if formally directed against the rejection of the complaint, has the effect of bringing before the Courts the act adversely affecting the applicant against which the complaint was submitted, except where the scope of the rejection of the complaint differs from that of the act against which that complaint was made. Any decision rejecting a complaint, whether express or implied, if it is straightforward, merely confirms the act or failure to act complained of and, when taken in isolation, does not constitute a challengeable act, so that the claims made against that decision which has no autonomous content in relation to the initial decision must be regarded as being directed against the initial act (see judgment of 18 October 2023, NZ v Commission, Case T‑535/22, EU:T:2023:653, paragraphs 15 and 16 and the case-law cited).
13      In the present case, the decision rejecting the complaint confirms the contested decision and its scope does not differ from that decision within the meaning of the case-law cited in paragraph 12 above.
14      Consequently, the claims for annulment must be regarded as being directed against the contested decision, the legality of which will be examined taking into consideration the reasons set out in the decision rejecting the complaint.
Substance
The first plea in law, alleging breach of the obligation to state reasons
15      By his first plea, the applicant argues that the Commission failed to comply with the obligation to state reasons, as set out in Article 41 of the Charter of Fundamental Rights of the European Union and Article 25 of the Staff Regulations.
16      In particular, the applicant submits that it is apparent neither from the contested decision nor from the decision rejecting the complaint, first, whether and in what way the appointing authority assessed his situation and, secondly, why that decision differs from those adopted in previous years granting him permission to engage in the same outside activity without imposing on him the restrictions in question. He adds that the discretion available to the Commission under Article 40(1) of the Staff Regulations does not exempt that institution from its obligation to state reasons.
17      The Commission disputes those arguments.
18      It is settled case-law that the obligation to state reasons referred to in Article 296 TFEU, recalled in Article 41(2)(c) of the Charter of Fundamental Rights and repeated in the second paragraph of Article 25 of the Staff Regulations, constitutes an essential principle of EU law, which is intended, on the one hand, to provide the persons concerned with sufficient details to enable them to assess whether the act adversely affecting them was well founded and, on the other hand, to enable the Courts to review the decision (see, to that effect, judgments of 26 November 1981, Michel v Parliament, 195/80, EU:C:1981:284, paragraph 22, and of 10 January 2024, VN v Commission, T‑159/23, not published, EU:T:2024:5, paragraph 34 and the case-law cited).
19      In addition, although a statement of reasons must disclose in a clear and unequivocal fashion the reasoning followed by the institution concerned, it must be assessed by reference to the circumstances of each case, in particular the content of the act in question, the nature of the reasons given and the interest which the person concerned may have in obtaining explanations. It is not, moreover, necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons for an act is sufficient 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. In particular, the reasons given for an act adversely affecting a person are sufficient if that measure was adopted in a context which was known to that person and which enables that person to understand the scope of the measure concerning him or her (see judgment of 23 November 2022, Bowden and Young v Europol, T‑72/21, not published, EU:T:2022:720, paragraph 41 and the case-law cited).
20      It follows that a statement of reasons does not need to be exhaustive, but, on the contrary, must be considered sufficient if it sets out the facts and the legal considerations having decisive importance in the context of the decision (see judgment of 19 December 2019, ZQ v Commission, T‑647/18, not published, EU:T:2019:884, paragraph 119 and the case-law cited).
21      In the present case, it must be observed that, in the first place, the Commission stated in the contested decision that that decision had been adopted on the basis of Articles 12b and 40 of the Staff Regulations and Articles 15 and 17 of Decision C(2018)
4048.
22      It follows therefrom that the wording of the contested decision clearly states the provisions applicable to the grant of permission to engage in an outside activity during the leave on personal grounds, the scope of those provisions being known to the applicant and referring expressly to the exceptional nature and limited duration of leave on personal grounds.
23      In the second place, in the contested decision, the Commission explained that the restrictions in question concerned consultancy activities in proceedings or cases it was handling and which were before the Courts of the European Union, or in which those institutions are involved. That prohibition also covered direct or indirect, including written, professional contact with the relevant departments at the Commission in the context of the applicant’s work in the consultancy firm.
24      In addition, in the decision rejecting the complaint, the Commission stated that the applicant, as Vice-President of a consultancy firm operating in the economic sector of the competition field, represents that firm in cases and proceedings before it and before the Courts of the European Union, in the same field as that in which he worked as an official in the Commission’s departments.
Thus, the appointing authority, even if it did not refer to specific cases, explained that the status of the applicant as an official on leave on personal grounds and his professional background within DG Competition could be perceived as giving rise to a conflict of interest. In that regard, the appointing authority also referred to the applicant’s biography, as published on the Internet site of the consultancy firm.
25      It follows from that information that the Commission provided the applicant with sufficient details to assess whether the contested decision was well founded and to understand the reasoning followed, within the meaning of the case-law cited in paragraphs 18 to 20 above.
26      In the third place, it must be noted that the contested decision was adopted in a context known to the person concerned, within the meaning of the case-law cited in paragraph 19 above.
27      In the email of 12 November 2021, sent before the adoption of the contested decision, first, the Director-General of DG Competition gave details as to the application of Articles 12b and 40 of the Staff Regulations. Secondly, he stated that, in order to assess risks of a conflict with the interests of the institution properly, the appointing authority should analyse each request, including renewals, in the light of the applicable criteria and taking into account specific circumstances and risks. He added that, if relevant, the Commission would also take into consideration the time elapsed since the official has been carrying out his or her activity outside its departments.
Furthermore, he specified that the fact of having been granted permission covering a limited period in previous years did not create any right to fresh permission being granted after the expiry of the period in relation to the previous permission.
28      So far as concerns the type of activities engaged in during leave on personal grounds, the Director-General observed that those that entailed representing private interests before the Commission, in particular in law firms or consultancy firms, put the official in a situation of perceived conflict of interest and consequently had a detrimental effect on the institution’s interests and reputation, in particular where the envisaged activity took place in the same area of expertise as the one in which that official had worked at the Commission. A member of staff who assists, during his or her leave on personal grounds, clients of the consultancy firm within which he or she works before DG Competition, whereas that member of staff has deep insights into the functioning of that directorate-general and contacts and links with his or her former Directorate-General or former colleagues, could reasonably be perceived by external parties as enjoying a privileged access to DG Competition, which could risk harming the public trust in the impartiality of the Commission’s decision-making process. The privileged access to DG Competition and the conflict of interest which might be perceived also stem from the fact that colleagues on leave on personal grounds are entitled to return to their position at the Commission, in particular to their former Directorate-General, at any time.
29      As regards the applicant’s specific situation, in the email of 12 November 2021 it was also stated that, in the light of the fact that his current outside activity involves representing clients and private interests before the Commission and DG Competition, and the time elapsed since he has worked within that institution, the appointing authority had decided in future not to grant him
permission to engage in those activities.
30      Having regard to all those factors, the first plea must be rejected as unfounded.
The second plea in law, alleging infringement of Article 40 of the Staff Regulations and of Decision C(2018) 4048 and breach of the principle of proportionality
31      By his second plea, the applicant argues that the appointing authority did not carry out an actual assessment of his specific situation in order to determine whether there was a risk of a conflict of interest. Accordingly, it infringed Article 40(1a) of the Staff Regulations and Decision C(2018)
4048 and breached the principle of proportionality.
32      That plea can be divided into two parts, alleging (i) infringement of Article 40 of the Staff Regulations and of Decision C(2018)
4048 and (ii) breach of the principle of proportionality.
–       The first part of the second plea in law, alleging infringement of Article 40 of the Staff Regulations and of Decision C(2018) 4048
33      By the first part of the second plea, the applicant alleges infringement of Article 40(1a) of the Staff Regulation and Articles 2 and 15 of Decision C(2018)
4048, inasmuch as the Commission did not carry out an actual assessment of his specific situation. According to the applicant, the Commission’s approach is that any official of DG Competition who is on leave on personal grounds and represents private clients and interests in competition proceedings before that institution as an economic consultant is automatically in a situation of conflict of interest. That approach is therefore contrary to Article 40(1a) of the Staff Regulations and Decision C(2018)
4048.
34      The applicant argues that the Commission unduly restricted its discretion under Article 40(1a) of the Staff Regulations and Articles 2 and 15 of Decision C(2018)
4048 by taking the view that, by reason of the fact that he represents, as an economic consultant, private interests before DG Competition, he is in a situation where there is a potential conflict of interest.
35      The Commission disputes those arguments.
36      It must be observed that Article 40(1) and (2) of the Staff Regulations provides that an official may, in exceptional circumstances and at his or her own request, be granted unpaid leave on personal grounds for a duration not exceeding one year, which may be extended repeatedly for a period of one year, for not more than 12 years in total.
37      It is apparent from Article 40(1a) of the Staff Regulations that, during that period, Article 12b of the Staff Regulations continues to apply, so that an official on leave on personal grounds wishing to engage in an outside activity must first obtain the permission of the appointing authority. As is apparent from Article 40 of those regulations, that permission is not to be granted to an official for the purpose of his or her engaging in an occupational activity, whether gainful or not, which involves lobbying or advocacy vis-à-vis his or her institution and which could lead to the existence or possibility of a conflict with the legitimate interests of the institution.
38      Article 15(1) and (2) of Decision C(2018)
4048 repeats, in essence, the text of Article 40(1a) of the Staff Regulations, whereas Article 15(3) of that decision provides, inter alia, for the possibility of granting the permission referred to in Article 12b of the Staff Regulations combined with appropriate restrictions.
39      In its review of the legality of a decision granting or refusing permission to engage in an outside activity, adopted under Article 12b of the Staff Regulations, to which Article 40(1a) of the Staff Regulations refers, the General Court must verify that the appointing authority kept within reasonable limits and did not use its power in a manifestly erroneous way (see, by analogy, judgment of 28 November 2019, Pinto Teixeira v EEAS, T‑667/18, not published, EU:T:2019:821, paragraph 50 and the case-law cited).
40      It is apparent from the contested decision, read together with the decision rejecting the complaint, that, in the present case, the Commission made such an assessment.
41      First, the Commission took account of the fact that the applicant held a position in DG Competition prior to being granted leave on personal grounds. Secondly, it examined the tasks of the consultancy firm in which the applicant requested leave to engage in activity as an economic consultant in the field of competition.
The Commission thus established that that consultancy firm handled, inter alia, cases in that field which are brought before DG Competition and the Courts of the European Union. Thirdly, the Commission examined the role of the applicant within that firm and concluded that, as Vice-President of that firm, he had a role representing the firm with a certain degree of public visibility.
Moreover, the Commission observed that the activity which the applicant is requesting to engage in concerns the same field as that in which he worked in its departments. In that regard, the appointing authority also examined the Internet site of that consultancy firm, on which the applicant’s professional background and previous responsibilities in DG Competition are stated.
42      It was in the light of those factors that the Commission concluded that the applicant could be perceived as being in a situation of conflict of interest, potentially having access to privileged information, contacts or documents.
43      As is apparent from
Article 15 of Decision C(2018)
4048, the permission may be refused or granted subject to conditions even where the conflict of interest is potential or may be perceived by the public as such. Therefore, the Commission was not required to examine each of the cases on which the applicant had worked in the consultancy firm or to refer to those cases.
44      Taken together, the factors referred to in paragraph 41 above are enough to demonstrate that the activity in respect of which the applicant sought the permission in question could be regarded as giving rise to a conflict of interest, in connection with cases brought before DG Competition and the Courts of the European Union, in particular as regards the private interests represented by the consultancy firm and the interests of DG Competition in which the applicant holds a position as an EU official.
45      As regards the condition relating to engaging in lobbying or advocacy, within the meaning of Article 40(1a) of the Staff Regulations, the Commission rejected, in the decision rejecting the complaint, in essence, the applicant’s argument that his activity does not involve lobbying or advocacy. The Commission stated that the applicant was engaged in an outside activity as Vice-President of a private economic consultancy firm and that that activity involved representing the consultancy firm in proceedings before it and before the Courts of the European Union in the same field as that in which he worked when he was in active service at the Commission. In the present case, the Commission contested the position adopted by the applicant according to which economic data analysis carried out within a consultancy firm in order to represent private interests before DG Competition does not involve lobbying or advocacy. It also pointed out that it was necessary to take into account the applicant’s role as Vice-President of that firm, in the light of the consultancy firm’s activities.
46      In its pleadings, the Commission added, without being challenged on that point by the applicant, that, on the Internet page of the consultancy firm, it was stated that economists from that firm had on many occasions testified in competition cases, or met with and provided submissions to antitrust enforcement agencies.
The Commission went on to state that, in their testimony, submissions and meetings with national and EU public authorities and in discussions with clients, those experts distilled complex competition issues and economic analyses into concepts and arguments that were understandable to non-economists.
47      The Commission inferred therefrom that the activity of the consultancy firm in question and, therefore, of the applicant had to be regarded as liable to give rise to a conflict with the legitimate interests of the institution, especially since he was not merely an employee, but Vice-President of that consultancy firm and that, as Vice-President, he had a central role in all of that firm’s activities.
48      As regard the emails between the applicant and the Commission in which they discuss several of DG Competition’s files on which the applicant worked within the consultancy firm and in respect of whose handling the applicant argues that he received implicit permission,
so that a general restriction would cover specific cases which, in the present case, would not create a conflict with the interests of the institution in question, it must be observed that those emails pre-date the email of 12 November 2021 and, accordingly, the adoption of a stricter approach so far as concerns permission to engage in outside activities during leave on personal grounds.
49      Thus, in the particular circumstances of the present case, the restriction imposed on the applicant on engaging in activities concerning proceedings and cases before the Commission and the Courts of the European Union and on contact with the Commission’s departments does not infringe Article 40(1a) of the Staff Regulations, especially given the applicant’s role as Vice-President of the consultancy firm, even if that restriction also includes conducting research or preliminary analysis of economic aspects.
50      Having regard to those considerations, it must be held that, by adopting the contested decision, the Commission did not infringe Article 40(1a) of the Staff Regulations and Decision C(2018)
4048.
51      Consequently, the first part of the second plea must be rejected as unfounded.
–       The second part of the second plea in law, alleging breach of the principle of proportionality
52      By the second part of the second plea, the applicant alleges breach of the principle of proportionality. Specifically, the applicant argues that the appointing authority breached the principle of proportionality, since a general prohibition covering all cases brought before the Courts of the European Union and the Commission does not necessarily involve lobbying activities or situations of conflict of interest.
53      The Commission disputes those arguments.
54      According to settled case-law, the principle of proportionality requires that measures adopted by the institutions do not exceed the limits of what is appropriate and necessary in order to attain the objectives legitimately pursued, it being understood that, where there is a choice between several appropriate measures, recourse must be had to the least onerous and that the disadvantages caused must not be disproportionate to the aims pursued (see judgment of 30 January 2020, BZ v Commission, T‑336/19, not published, EU:T:2020:21, paragraph 28 and the case-law cited).
55      In the present case, it is common ground that the Commission granted permission to engage in the activity in question subject to a restriction concerning competition cases before DG Competition and the Courts of the European Union. Thus, the applicant was granted permission to pursue his activity as Vice-President of the consultancy firm and to handle cases brought before national competition authorities and national courts.
56      In that regard, as regards the applicant’s argument that a general restriction prohibiting him from being involved, participating in or advising in all proceedings and cases handled by the Commission or before the Courts of the European Union is disproportionate, it must be observed that that restriction is warranted by the fact that the applicant, as an official on leave on personal grounds, continues to have links under the Staff Regulations with the EU institutions and in particular with that of which he is a member of staff, namely DG Competition. Thus, first, the activity engaged in by the applicant must be considered globally, taking account of his role as Vice-President of the consultancy firm, and therefore representing that firm, and the firm’s activity as a whole. Secondly, there may be a perceived conflict of interest inasmuch as the applicant is engaged in the same economic consultancy activities in competition cases as he was engaged in at
DG Competition, this time representing private interests before DG Competition.
57      Consequently, the Commission correctly assessed the restrictions in question as necessary and appropriate in relation to the objective pursued by Article 40(1a) of the Staff Regulations aimed at avoiding situations of conflict of interest between the institution and the official on leave on personal grounds. It must be found that those restrictions are proportionate to that objective given that, instead of prohibiting the applicant from engaging in the outside activity in question, the appointing authority granted permission for that activity while imposing restrictions which it regarded as appropriate and necessary. Thus, the appointing authority took into account the possibility for the applicant to engage in consultancy activities at national level.
58      Therefore, the second part of the second plea in law must be rejected as unfounded and, therefore, the second plea must be rejected in its entirety.
The third plea in law, alleging breach of the principle of equal treatment
59      By his third plea, the applicant argues that the Commission failed to comply with the principle of equal treatment on the ground that another colleague, who is also an official on leave on personal grounds from DG Competition working on competition cases, had not been subject to such stringent restrictions. Similarly, those restrictions were not imposed on other officials who were no longer working at DG Competition immediately before taking leave on personal grounds. In the rejoinder, the applicant reveals the identity of those colleagues.
60      The Commission disputes those arguments.
61      According to the principle of equal treatment, which is a general principle of law which the Commission must observe, comparable situations must not be treated differently and different situations must not be treated in the same way unless such treatment is objectively justified (see, to that effect, judgment of 15 April 2010, Gualtieri v Commission, C‑485/08 P, EU:C:2010:188, paragraph 70 and the case-law cited).
62      In the present case, the applicant argues that there is a breach of the principle of equal treatment in relation, first, to one of his colleagues who is also on leave on personal grounds, and, secondly, to certain colleagues who are no longer working for the EU institutions.
63      In the first place, as regards the alleged difference in treatment in relation to the applicant’s colleague on leave on personal grounds, who is also an official at DG Competition, the Commission observes that that official received the decision granting him permission to engage in an outside activity during his leave on personal grounds, which activity is allegedly similar to that in respect of which the applicant requested
permission, before the email of 12 November 2021 was sent. Likewise, prior to the communication of that email and the recommendations it contains, decisions on requests made by the applicant for permission to engage in an outside activity, for the purposes of Article 40(1a) of the Staff Regulations, did not contain the restrictions in question.
64      In the second place, as regards the applicant’s former colleagues who no longer work for EU institutions, it must be observed that, as noted by the Commission, those former colleagues are not in a situation comparable to that of the applicant.
65      Although they may previously have been officials on leave on personal grounds, they have resigned and, consequently, their links with the EU institutions under the Staff Regulations have been severed. Therefore, after leaving the service, the request made by those former officials for permission to engage in an occupational activity was not based on Article 12b of the Staff Regulations, but on Article 16 of the Staff Regulations, which lays down different conditions for granting such permission.
66      Thus, it must be concluded that the applicant has not demonstrated the existence of a breach of the principle of equal treatment in relation to his former colleagues who have resigned.
67      In the light of those considerations, the third plea must be rejected and, consequently, the action must be dismissed in its entirety.
Costs
68      Under Article 134(1) of the Rules of Procedure of the General Court, 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 pay the costs, in accordance with the form of order sought by the Commission.
On those grounds,
THE GENERAL COURT (Fourth Chamber)
hereby:
1.      Dismisses the action;
2.      Orders SN to pay the costs.
da Silva Passos
Półtorak
Pynnä
Delivered in open court in Luxembourg on 23 October 2024.
V. Di Bucci
S. Papasavvas
Registrar
President
*      Language of the case: English.