61962C0018
OPINION OF MR ADVOCATE-GENERAL M. LAGRANGE
DELIVERED ON 5 NOVEMBER 1963 (
1
)
Mr President
Members of the Court,
The final developments in this case, as you will certainly recall, concerned the more factual aspects of the litigation, notably the consumption of electricity and the periods covered by this consumption. These were a result of the Court's own efforts to elucidate the facts as clearly as possible, efforts moreover which enabled the Court to get closer to the real position. But one must not lose sight of the fact that the action brought before the Court is an application for annulment relating to the legality of two Decisions of the High Authority of 23 May 1962, the first of which determines the tonnage assessable for that undertaking's equalization contribution for the different periods concerned, and the second, which is enforceable within the meaning of Article 92 of the Treaty, fixes the amount of the contribution which is consequently owing.
We are therefore not concerned with an action of unlimited jurisdiction as if for example a fine or. periodic penalty payment had been imposed under Article 36 which is not the case here; for although the applicant also relies upon Article 36, it is perhaps so as to be able to invoke the objection of illegality against the general Decisions forming the basis for the Decisions in dispute, which is expressly permitted under this Article. But that is a precaution which is both inoperative, since Article 36 was not applied in this case, and useless because, as both you and learned counsel for the applicant know, the objection of illegality may, according to the Chasse and Meroni judgments of 12 and 13 June 1958, be invoked in support of an application for annulment brought against any individual decision. Within the context of such an application the Court is not itself required to lay down the amount of the contribution due, but to pronounce upon the legality of the disputed decision, in the light of the submissions raised against it and the facts have only to be considered to the extent that they affect this legality.
Logically the first question to be examined is whether the Decision at issue was addressed in proper form to Mrs Barge.
It has first of all been pointed out with regard to this matter that Mrs Barge is the widow of the engineer Vittorio Leone, son of the engineer Antonio Leone, founder of the undertaking, and not the widow of the latter. But this has not been contested and the error made in the title (not in the body) of the disputed Decisions, which is correcdy addressed to Mrs Barge as representative of ‘Acciaieria ing. A. Leone, of Borgaro Torinese’ is obviously unimportant.
The applicant secondly declares herself only able to ‘accept the procedural situation’ in her own name and not as sole representative of the undertaking A. Leone. In fact she has a daughter who is a minor and the joint beneficiary of her father's estate under the will of the applicant's husband made before a notary and in the presence of witnesses on 26 January 1956.
On this question it is sufficient to recall that, according to the desire of the testator, the will makes the sole responsibility for the payment of all charges, liabilities and debts of the undertaking rest with Mrs Barge. As to the effect of the assignment of the assets of the undertaking, which was agreed upon on 4 February 1958 between the applicant and her father and brother, both directors of Ferriere di Borgaro, the High Authority does not, it seems, need to take this into account; these are private law relationships, which took place moreover after the period to which the disputed Decision relates and which are not effective to deprive Mrs Barge of her capacity as legal representative of the A. Leone undertaking, and accordingly debtor as regards the contribution due by reason of the bought ferrous scrap consumed for the needs of its production. Moreover, in her reply, the applicant leaves this matter to the discretion of the Court.
I shall now examine, following the order of the application, the submissions concerning the illegality of the general Decisions and then those which directly concern the Decisions in dispute.
A.
As to the objection of illegality, the High Authority in its statement of defence has raised a plea of inadmissibility based upon the alleged acquiescence of the applicant in the general Decisions, an acquiescence which can be inferred from her conduct. In fact, it alleges first that she had transferred to Ferriere di Borgaro in 1956 all the liabilities of A. Leone including the equalization debt, amounting to 40435468 Lire which Borgaro had to meet. The defendant also argues that by having brought before the Court an action for compensation (Case 8/61) based on the ‘fact that she had had to sell her steel undertaking without having been able to pass on to the buyers the equalization contribution which was subsequently imputed to her’, the applicant had recognized thereby the existence of her debt, and by implication renounced her right to contest its basis.
I confess that I do not understand very well this plea of inadmissibility on which, moreover, the High Authority no longer insisted during the oral procedure. In fact, the alleged acquiescence, if it were established, would apply to the equalization debt itself, and it is thus not easy to see why it should only be an obstacle to the right to contest the legality of the general Decisions; it must necessarily prevent any denial of the legality of the individual Decisions establishing the amount of the equalization debt, which, however, the defendant does not claim. Assuming that the application is admissible with respect to the individual Decisions, it must, according to the case law Of this Court, be open to the applicant, by way of an exception, to invoke any submission based on the illegality of the general Decisions which serve as a basis for the individual Decisions contested in the normal manner.
The objection of illegality refers to:
1.
Article 10 (b) and (d) of Decisions Nos 2/57 and 16/58;
2.
Various Articles of Decisions Nos 18/60, 19/60 and 20/60.
1.
Article 10 (b) and (d) of Decisions Nos 2/57 and 16/58. Article 10 (b) specifies that alloy steel scrap is not subject to the equalization contribution; Article 10 (d) lays down the same exemption for integrated steel foundries, for the proportion of the consumption of bought ferrous scrap which corresponds to the amount of crude steel produced according to the type of plant or manufacturing process. According to the applicant, these are exemptions for which there are no valid reasons and which are retroactive and discriminatory.
I shall not linger on these grounds of complaint which, in my opinion, the defendant has disproved in its statement of defence and rejoinder. In fact, the exemption, or rather the decision not to impose any contribution, is objectively justified in both cases. First, as to alloy steel scrap, justification lies in the particular characteristics of this kind of ferrous scrap which is clearly distinguishable, as much in price as in composition and use, from ordinary ferrous scrap with which it is not in competition. Secondly as to the integrated steel foundries, justification lies in the need to maintain equal conditions of competition between the integrated foundries and the independent foundries as regards the manufacture of steels for casting, which fall outside Annex I.
These considerations did not need to De expressly mentioned in the preambles to the Decisions. The need for a statement of reasons clearly differs according to the nature of the decision; for regulations it is essential to outline in a general way the objects sought to be achieved by the regulation, the reasons justifying it, and the main lines of the system adopted; it is not necessary, on the other hand, to add a commentary on the various provisions of the text when these are clear in themselves and fall naturally within the system as a whole.
The ground of complaint based on retroactivity must also be dismissed, assuming that we are not concerned here with derogations or exemptions but only with a more precise determination of the detailed rules for calculating the basis of contribution; these detailed rules must necessarily be the same for everybody from the time the compulsory scheme started to function.
Finally, if it is admitted that the Decisions are objectively justified, there can be no question of discrimination or misuse of powers.
2.
Decisions Nos 18/60, 19/60 and 20/60. It is, again, the functioning of the equalization scheme which is treated under this head. From the legal point of view none of the various grounds of complaint raised with regard to this matter seem to me to be well founded. Whether it is absence or insufficiency of reasoning, lack of publicity, absence of a general report (Article 17 of the Treaty) or of the auditor's report, the High Authority replies with pertinent arguments to each of these complaints, which in my opinion can only be dismissed.
B.
There remain those grounds or complaint which concern the disputed Decisions themselves.
A first series of complaints concerns the inspections conducted by the Fiduciaire suisse. The applicant alleges:
(1)
that the task of the Fiduciaire suisse was not established in a decision nor was it notified to the State concerned and consequently the fourth paragraph of Article 86 of the Treaty was infringed;
(2)
that the Fiduciaire suisse, a private company, did not have the capacity to exercise the powers of a public service;
(3)
that the inspections made by the officials of that company were not drawn up in any minutes, nor were they given any publicity.
The defendant replies, as you know, that there is no question of any infringement of Article 86 since the inspections and checks were undertaken solely in pursuance of Article 47 and not of Article 86. The Fiduciaire suisse was only charged with obtaining information on behalf of the High Authority; to which the applicant replies by producing an opinion of Campsider, the Italian regional office of the scheme, according to which the High Authority had conferred upon the Fiduciaire suisse the task of checking the movements of the ferrous scrap undertakings under Articles 47 and 86 of the Treaty. The defendant contents itself with the reply that it is not responsible for the workings of Campsider.
In fact, in my opinion, there seems to be no point to this dispute. According to the case law of this Court, Article 47 permits the High Authority to obtain ‘all the information it requires to carry out its tasks’ and ‘to have any necessary checks made’. There is nothing to prevent any on-the-spot checks being carried out by an accounting establishment which is duly authorized for this purpose. Recourse to Article 86 and the necessity of observing the procedure which it lays down only concern the case where it appears necessary to enable the High Authority's officials to exercise the coercive powers given by the revenue laws of a State to its own national officials (Judgment in Joined Cases 5 to 11/62 of 4 December 1962, Rec. 1962, p. 884). It has never been alleged that the officials of the Fiduciaire suisse have ever attempted to exercise such coercive powers or make use of prerogatives reserved by law to the officials of the Italian revenue authorities. No more are they under any obligation to draw up minutes in good and proper form of the results of their checks.
The second series of complaints concerns the merits of the bases for determining the contribution as laid down in the disputed Decisions. Two factors give rise to dispute in this matter:
(1)
the validity of the criterion used by the High Authority, that is to say the consumption of electricity;
(2)
the accuracy of the assessment of the amount of that consumption.
(a)
Value of the criterion used. The applicant refers to the judgment of this Court of 14 December 1962, in Joined Cases 5 to 11/62, to which I have just referred and in which it is stated that the consumption of electric energy by furnaces constitutes only one of the factors capable of determining the tonnages of ferrous scrap consumed.
That is what the Court declared, in agreement, what is more, with the High Authority's own argument. Does it follow from this that when no other factor exists for checking, as the accounting documents have been com pletely destroyed, the High Authority must purely and simply renounce and abandon the task? I hardly think that can have been the Court's intention on 14 December 1962; it certainly was not mine when I advised the Court to uphold the argument of the High Authority at that time. The consumption of electricity constitutes, in my opinion, a valid factor even by itself, on condition that the ratio of the consumption of electricity to that of ferrous scrap has been correctly established. For that, it is first necessary, from a technical point of view, that the average relationship be established as accurately as possible and, secondly, that the undertaking in question is left all the latitude it requires to set out the reasons which, because of its particular manufacturing process, of its machinery, or of any other factor, means that in its case the average ratio worked out by the experts is not applicable.
These two conditions appear to me to be present in this case. The average ratio seems to have been worked out with great precision by a commission of experts from the six Member States meeting at Luxembourg under the auspices of the High Authority. To this expert opinion, the applicant opposes another which criticizes the first which in turn is rejected by the High Authority. I have read closely all these documents which you will have to appraise. In my view the opposing expert opinion produced by the applicant is not sufficient to cast doubt on the validity of the work of the High Authority's commission of experts.
On the other hand, the applicant has not adduced any precise factor, based on conditions peculiar to the manufacturing processes of the Leone undertaking, capable of pointing to a ratio of consumption different from the average established by the experts.
(b)
Assessment of the consumption of electricity. On this point my comments will be brief, since, as you will recall, this point has been clarified as far as is possible. I would merely point out that in law it is accepted practice to require undertakings, in the absence of all accounting documents, to produce their electricity invoices for the corresponding periods of assessment; this is what the Court recognized in its judgment of 14 December 1962. It is also quite normal, if these invoices are not produced and if the undertaking neglects or refuses to procure duplicates from the supplier of electric current or does not succeed in obtaining them from him, for the officials whose duty it is to carry out the investigation to contact the supplier themselves. Finally, if for any particular period information is entirely lacking, the only remaining method is to proceed by extrapolation. That is what happened in this case, and it led to the figure of 28386 metric tons being fixed as the assessable tonnage for the period from 1 October 1955 to 31 January 1958.
Thanks to the perseverance of the Court in its efforts to obtain more precise information, it was in the end possible, under the circumstances alluded to in the oral procedure (which in my opinion it would be poindess to repeat), to find out the actual consumption during the period for which the High Authority was forced to infer consumption (letter from the electricity company dated 11 October 1963). Thanks to this new information, which corresponds more to the real position, the assessable tonnage is now reduced from 28386 to 25506 metric tons of ferrous scrap.
Nevertheless, as I pointed out at the beginning of my observations, the Court in this case has had brought before it an application for annulment and could have had no other action brought before it as Article 36 was not applied. It has no jurisdiction to fix the amount of the debt. The legality of a decision must be determined with reference to the day when it was taken. If the Court considered itself under an obligation to try to throw as much light on the case as possible, it was not so as to be able to fix the amount of the contribution, but to be better able to check whether, in taking the Decisions now being challenged, the High Authority acted legally. I believe that this was the case; consequendy the application should be dismissed and the applicant should bear the costs. This will not, of course, prevent the deduction being made, either on the applicant's request or by the Court of its own motion, taking into account this last piece of information obtained with such difficulty and so late in the proceedings by reason of the attitude taken by the applicant.
I am therefore of the opinion that the application should be dismissed and Mrs Barge, in her representative capacity, should bear the costs.
(
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