61985CO0097_EN
Parties
Subject of the case
Grounds
Operative part
Parties
IN CASE 97/85 R
UNION DEUTSCHE LEBENSMITTELWERKE GMBH, HAVING ITS REGISTERED OFFICE IN HAMBURG,
WALTER RAU LEBENSMITTELWERKE KG, HAVING ITS REGISTERED OFFICE IN HILTER,
WESTFALISCHES MARGARINEWERK WILHELM LINDEMANN KG, HAVING ITS REGISTERED OFFICE IN BUNDE,
HEINRICH HAMKER, LEBENSMITTELWERKE GMBH & CO . KG, HAVING ITS REGISTERED OFFICE IN BAD ESSEN-LINTORF,
ALL REPRESENTED BY MODEST, GUNDISCH, LANDRY, RAUSCHNING, FESTGE, HEEMANN, BAUER, VOLKMANN-SCHLUCK, RECHTSANWALTE IN HAMBURG, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF E . ARENDT, 34 B RUE PHILIPPE-II,
APPLICANTS,
V
COMMISSION OF THE EUROPEAN COMMUNITIES, REPRESENTED BY MR KARPENSTEIN AND MR JANSEN, MEMBERS OF THE COMMISSION ' S LEGAL DEPARTMENT, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF G . KREMLIS, A MEMBER OF THE COMMISSION ' S LEGAL DEPARTMENT, JEAN MONNET BUILDING, KIRCHBERG,
DEFENDANT,
Subject of the case
APPLICATION FOR AN ORDER SUSPENDING THE OPERATION OF THE COMMISSION DECISION OF 25 FEBRUARY 1985 ( REF . K(85)276 ) CONCERNING MEASURES TO PROMOTE THE SALE OF BUTTER ON THE WEST BERLIN MARKET,
Grounds
1 BY AN APPLICATION LODGED AT THE COURT REGISTRY ON 16 APRIL 1985, THE APPLICANTS SOUGHT AN ORDER SUSPENDING THE OPERATION OF THE COMMISSION DECISION OF 25 FEBRUARY 1985 CONCERNING MEASURES TO PROMOTE THE SALE OF BUTTER ON THE WEST BERLIN MARKET, PENDING A DECISION ON THE APPLICATION FOR THE ANNULMENT OF THAT DECISION LODGED BY THEM ON 15 APRIL 1985 .
2 IT APPEARS THAT THE NINTH COMMUNICATION FROM THE COMMISSION TO THE COUNCIL CONCERNING THE PROGRAMME FOR THE USE OF FUNDS DERIVED FROM THE CO-RESPONSIBILITY LEVY IN THE DAIRY SECTOR FOR THE 1985/86 MILK YEAR ( COM ( 84 ) 675 OF 4 DECEMBER 1984 ) MADE PROVISION FOR SPECIFIC OPERATIONS TO BE CARRIED OUT TO TEST THE EFFECTIVENESS OF VARIOUS MEASURES DESIGNED TO INCREASE CONSUMPTION OF DAIRY PRODUCTS, ESPECIALLY BUTTER .
3 IN ITS CONTESTED DECISION THE COMMISSION STATED THAT SUCH OPERATIONS SHOULD BE RESTRICTED TO A GEOGRAPHICALLY ISOLATED REGION, NAMELY THE CITY OF WEST BERLIN, IN ORDER TO PERMIT AN ACCURATE APPRAISAL TO BE MADE OF THE EFFECTIVENESS OF THE MEASURE IN QUESTION .
4 ARTICLE 2 OF THE CONTESTED DECISION PROVIDES THAT 900 TONNES OF BUTTER FROM PUBLIC STOCKS ARE TO BE DISTRIBUTED FREE OF CHARGE IN WEST BERLIN FROM THE COLD-STORAGE PLANT BY THE INTERVENTION AGENCY OF THE FEDERAL REPUBLIC OF GERMANY .
5 IN THEIR APPLICATION FOR THE ADOPTION OF INTERIM MEASURES, THE APPLICANTS CONTEND THAT, CONTRARY TO THE PROVISIONS OF THE GERMAN LEGISLATION RELATING TO UNFAIR COMPETITION, THE BUTTER IN QUESTION, WHICH COMES FROM INTERVENTION STOCKS, IS TO BE LABELLED ' FREE EEC BUTTER '
AND THAT, MOREOVER, EVERY PACKET OF BUTTER DISTRIBUTED FREE OF CHARGE WILL BE PACKED TOGETHER WITH A PACKET OF FRESH BUTTER OF THE SAME SIZE WHICH MUST BE SOLD AT THE NORMAL PRICE . THE BUTTER SO DISTRIBUTED CORRESPONDS TO APPROXIMATELY ONE AND A HALF TIMES THE MONTHLY CONSUMPTION OF MARGARINE IN BERLIN . SUCH DISTRIBUTION FREE OF CHARGE AND ON A MASSIVE SCALE OF A COMPETING PRODUCT WOULD HAVE THE EFFECT OF DISPLACING THE APPLICANTS FROM THE MARKET . THE APPLICANTS ARE RESPONSIBLE FOR APPROXIMATELY TWO-THIRDS OF SALES OF MARGARINE IN BERLIN . THEY ARE THUS THREATENED WITH IRREPARABLE DAMAGE .
6 THE APPLICANTS CONTEND THAT THE DECISION IS IN BREACH OF THE PRINCIPLE OF FREEDOM TO CARRY ON BUSINESS, THE OBJECTIVE OF MARKET STABILITY EMBODIED IN ARTICLE 39 OF THE EEC TREATY, THE PRINCIPLE OF NON-DISCRIMINATION, THE PRINCIPLE OF THE PROTECTION OF LEGITIMATE EXPECTATION AND THE PRINCIPLE OF PROPORTIONALITY . THE COMMISSION DECISION IN QUESTION, WHICH IS BASED ON COUNCIL REGULATION ( EEC ) NO 1079/77, IS ALSO, IN THE APPLICANTS '
VIEW, ULTRA VIRES .
7 INITIALLY THE DISTRIBUTION OF FREE INTERVENTION BUTTER IN BERLIN WAS DUE TO BEGIN ON 15 APRIL 1985 . ON 20 MARCH 1985 THE APPLICANTS OBTAINED FROM THE VERWALTUNGSGERICHT ( ADMINISTRATIVE COURT ), FRANKFURT, AN INTERIM ORDER AGAINST THE GERMAN INTERVENTION AGENCY PROHIBITING IT FROM IMPLEMENTING THE PROPOSED MEASURE CONCERNING THE DISTRIBUTION OF BUTTER FREE OF CHARGE . HOWEVER, THE ORDER MADE BY THE VERWALTUNGSGERICHT FRANKFURT WAS POSTPONED ON PROCEDURAL GROUNDS BY ORDER OF THE HESSISCHE VERWALTUNGSGERICHTSHOF ( HIGHER ADMINISTRATIVE COURT, HESSE ) OF 11 APRIL 1985 . THE GERMAN INTERVENTION AGENCY THEREFORE ISSUED STATEMENTS TO THE PRESS ANNOUNCING THAT DISTRIBUTION WOULD NOW BEGIN ON 6 MAY 1985 .
8 ACCORDING TO THE APPLICANTS, THAT OPERATION WOULD CAUSE THEM TO INCUR LOSSES EQUIVALENT TO APPROXIMATELY ONE MONTH ' S SALES OF MARGARINE IN WEST BERLIN . WHEN THE DECISION ON THE APPLICATION FOR THE ANNULMENT OF THE DECISION IS GIVEN, IT WILL BE TOO LATE FOR THE APPLICANTS TO CLAIM COMPENSATION FOR THE DAMAGE SUFFERED AS A RESULT OF THE LOSS OF REVENUE - AMOUNTING TO SEVERAL MILLION DM - EXCEPT BY MEANS OF AN ACTION FOR DAMAGES .
9 HOWEVER, THE APPLICANTS CLAIM THAT THEY ARE THREATENED IN PARTICULAR WITH NON-MATERIAL DAMAGE . IN THEIR VIEW, ONCE THEY HAVE BEEN DISPLACED FROM THE MARKET, IT WILL BE DIFFICULT FOR THEM TO REGAIN THEIR FORMER POSITION ON IT . THERE IS ALSO A RISK THAT OTHER MANUFACTURERS OF COMPETING PRODUCTS MAY RESORT TO MEASURES OF THAT KIND WHICH JEOPARDIZE FAIR COMPETITION .
10 ON THE OTHER HAND, THE APPLICANTS MAINTAIN THAT THE DISADVANTAGES FOR THE EUROPEAN COMMUNITY OF FURTHER POSTPONING THE OPERATION OF THE DECISION ARE NEGLIGIBLE .
11 THE COMMISSION CONTENDS THAT THE APPLICATION IN THE MAIN ACTION IS INADMISSIBLE ON THE GROUND THAT THE CONTESTED DECISION IS NEITHER OF DIRECT NOR OF INDIVIDUAL CONCERN TO THE APPLICANTS WITHIN THE MEANING OF THE SECOND PARAGRAPH OF ARTICLE 173 OF THE EEC TREATY . ANY MARGARINE PRODUCER CAN AT ANY TIME DECIDE TO TAKE AN INTEREST IN THE BERLIN MARKET, WITH THE RESULT THAT THE APPLICANTS ARE NOT INDIVIDUALLY DISTINGUISHED BY ANY PARTICULAR CHARACTERISTIC IN SUCH A WAY AS TO PLACE THEM IN A POSITION SIMILAR TO THAT OF THE ADDRESSEE OF THE COMMISSION ' S DECISION .
12 THE COMMISSION CONSIDERS THAT THE 900 TONNES OF BUTTER OFFERED FOR SALE TO CONSUMERS IN BERLIN REPRESENTS LESS THAN 0.4% OF TOTAL MARGARINE CONSUMPTION IN THE FEDERAL REPUBLIC OF GERMANY AND WEST BERLIN . EVEN IF THE SALE OF THAT BUTTER WERE ENTIRELY TO THE DETRIMENT OF THE SALE OF MARGARINE - A VIEW WHICH THE COMMISSION CANNOT ACCEPT - THE DAMAGE COULD IN NO CIRCUMSTANCES BE DESCRIBED AS SERIOUS . NOR IS THE CONDITION THAT DAMAGE MUST BE IRREPARABLE FULFILLED WHERE THE APPLICANT CAN BRING AN ACTION FOR DAMAGES AGAINST THE COMMISSION . MOREOVER, THE COMMISSION POINTS OUT THAT THE GERMAN INTERVENTION AGENCY GAVE INSTRUCTIONS ON 12 APRIL 1984, THAT IS TO SAY WELL BEFORE THE SUBMISSION OF THE APPLICATION FOR INTERIM MEASURES, FOR THE WITHDRAWAL OF AN INITIAL CONSIGNMENT OF 450 TONNES OF INTERVENTION BUTTER FROM THE WAREHOUSES IN WHICH IT WAS STORED . IN THE MEANTIME THE BUTTER HAS BEEN THAWED, CUT UP INTO PACKETS OF 250 GRAMMES AND TRANSPORTED TO BERLIN . IT IS AT PRESENT HELD BY DISTRIBUTORS AND RETAILERS, WHO CANNOT BE COMPELLED TO RAISE THE PRICE . TOTAL COSTS IN RESPECT OF THE 450 TONNES AMOUNT TO DM 1 019 628, EXCLUDING THE FURTHER EXPENSE WHICH THE NEED TO RE-OPEN THE PACKAGES AND RE-DELIVER THE BUTTER TO THE GERMAN INTERVENTION AGENCY WOULD ENTAIL . THE COST OF SUSPENDING THE COMMISSION ' S DECISION WOULD THEREFORE BE MUCH HIGHER THAN THE COSTS WHICH THE APPLICANTS WILL INCUR IF THE OPERATION IS CARRIED OUT . THE COMMISSION COMPARES THE CONTESTED MEASURE WITH THE ' CHRISTMAS BUTTER '
OPERATIONS, THE SMALLEST OF WHICH INVOLVED 72 000 TONNES OF BUTTER BUT WHICH THE APPLICANTS DID NOT CONTEST BY MEANS OF AN APPLICATION FOR THE ADOPTION OF INTERIM MEASURES .
13 CONTRARY TO THE APPLICANTS '
CONTENTION, THE DECISION IS NOT IN BREACH OF THE RIGHT TO CARRY ON BUSINESS WITHOUT HINDRANCE SINCE THE APPLICANTS ARE IN NO WAY DEPRIVED OF THEIR RIGHT TO CONTINUE TO SELL THEIR PRODUCTS . NOR IS THE DECISION IN BREACH OF THE PRINCIPLE OF MARKET STABILIZATION EMBODIED IN ARTICLE 39 OF THE EEC TREATY ; ON THE CONTRARY, ITS PURPOSE IS TO RESTORE STABILITY ON THE BUTTER MARKET . IT MUST BE BORNE IN MIND THAT THE OPERATION UNDERTAKEN IN BERLIN IS PURELY EXPERIMENTAL, INASMUCH AS THE BEHAVIOUR OF CONSUMERS WITHIN A RESTRICTED, THOUGH REPRESENTATIVE MARKET WILL BE STUDIED AGAINST THE BACKGROUND OF A SIGNIFICANT FALL IN PRICES SPREAD OVER AN EXTENDED PERIOD .
14 NOR CAN IT BE ALLEGED THAT THE MEASURE IN QUESTION DISCRIMINATES AGAINST MARGARINE PRODUCERS SINCE THE LATTER ARE IN A SITUATION WHICH IS ENTIRELY DIFFERENT FROM THAT OF PRODUCERS OF DAIRY PRODUCTS . ACCORDINGLY, WHILST THE BUTTER MARKET IS GOVERNED ESSENTIALLY BY THE INTERVENTION PRICE, MARGARINE MANUFACTURERS CAN IMPORT THEIR BASIC PRODUCTS FREE OF LEVY AT PRICES CORRESPONDING TO THOSE CHARGED ON THE WORLD MARKET . AS FAR AS THE ALLEGED BREACH OF THE PRINCIPLE OF PROPORTIONALITY IS CONCERNED, IT IS NOT FOR THE COURT OF JUSTICE BUT RATHER FOR THE EUROPEAN PARLIAMENT OR THE COURT OF AUDITORS TO CONSIDER THE RELATIONSHIP BETWEEN THE COSTS AND THE BENEFITS OF THE OPERATION .
15 FURTHERMORE, THE COMMISSION POINTS OUT THAT THE APPLICANTS CANNOT, ANY MORE THAN ANY OTHER UNDERTAKING, RELY ON AN ACQUIRED RIGHT TO RETAIN THE BENEFITS RESULTING FROM THE IMPLEMENTATION OF A SYSTEM ESTABLISHING A COMMON ORGANIZATION OF A MARKET . IN ITS VIEW, THE APPLICANTS ARE ALSO WRONG TO RELY ON AN INFRINGEMENT OF THE GERMAN LEGISLATION ON COMPETITION, FIRST OF ALL BECAUSE COMMUNITY LAW IS AN INDEPENDENT SOURCE OF LAW WHICH CANNOT BE ASSESSED BY REFERENCE TO NATIONAL LAW AND, SECONDLY, BECAUSE THE COMMUNITY IS NOT A COMMERCIAL UNDERTAKING SUBJECT TO COMPETITION LAW . FINALLY, THE COMMISSION DENIES THAT ITS DECISION IS ULTRA VIRES .
16 ARTICLE 185 OF THE EEC TREATY PROVIDES THAT ACTIONS BROUGHT BEFORE THE COURT OF JUSTICE DO NOT HAVE SUSPENSORY EFFECT . THE COURT MAY, HOWEVER, IF IT CONSIDERS THAT CIRCUMSTANCES SO REQUIRE, ORDER THAT APPLICATION OF THE CONTESTED MEASURE BE SUSPENDED AND PRESCRIBE ANY OTHER INTERIM MEASURE PURSUANT TO ARTICLES 185 AND 186 OF THE EEC TREATY .
17 IT IS WELL ESTABLISHED IN THE CASE-LAW OF THE COURT THAT SUCH MEASURES MAY BE GRANTED ONLY IF IT IS SHOWN THAT THERE ARE FACTUAL AND LEGAL GROUNDS ESTABLISHING A PRIMA FACIE CASE FOR THEM ; IF THEY ARE URGENT IN THE SENSE THAT IT IS NECESSARY, IN ORDER TO AVOID SERIOUS AND IRREPARABLE DAMAGE TO THE PARTY SEEKING THEM, FOR THEM TO BE ADOPTED AND PRODUCE THEIR EFFECTS BEFORE THE DECISION OF THE COURT ON THE SUBSTANCE OF THE CASE ; AND, FINALLY, IF THEY ARE PROVISIONAL, THAT IS, IF THEY ARE WITHOUT PREJUDICE TO THE DECISION ON THE SUBSTANCE OF THE CASE .
18 DURING THE ORAL PROCEDURE THE APPLICANTS DREW ATTENTION TO THE ALLEGEDLY UNLAWFUL NATURE OF THE CONTESTED MEASURE UNDER GERMAN COMPETITION LAW . THAT POINT MAY INVOLVE DELICATE QUESTIONS OF LAW, BUT IT CANNOT BE DECIDED IN PROCEEDINGS FOR THE ADOPTION OF INTERIM MEASURES WITHOUT SERIOUS RISK OF PREJUDGING THE SUBSTANCE OF THE CASE .
19 MOREOVER, THERE ARE SERIOUS DOUBTS AS TO WHETHER THE MAIN APPLICATION IS ADMISSIBLE . THE CONTESTED DECISION IS ADDRESSED TO THE FEDERAL REPUBLIC OF GERMANY AND IT IS NOT IMMEDIATELY APPARENT THAT, AS A RESULT OF THE PARTICULAR CHARACTERISTICS OR CIRCUMSTANCES WHICH ARE PECULIAR TO THEM ALONE OR WHICH DISTINGUISH THEM FROM ANY OTHER UNDERTAKING, THE CONTESTED DECISION IS OF DIRECT AND INDIVIDUAL CONCERN TO THE APPLICANTS .
20 HOWEVER, THAT QUESTION MAY REMAIN OPEN FOR THE PRESENT . IT BECAME APPARENT AT THE HEARING THAT THE APPLICANTS ARE PRIMARILY CONCERNED LEST THE OPERATION CARRIED OUT BY THE COMMISSION, BEING AN EXPERIMENT, BE EXTENDED SUBSEQUENTLY TO THE REST OF THE COMMUNITY . IN THAT REGARD THE COMMISSION STATED THAT NO SUCH EXTENSION COULD TAKE PLACE LESS THAN 12 MONTHS AFTER THE EXPERIMENT AND THAT IN ANY EVENT SUCH AN EXTENSION WOULD BE THE SUBJECT OF DETAILED CONSIDERATION . EVEN IF, SHOULD THAT OCCUR, SERIOUS DAMAGE TO THE APPLICANTS CANNOT BE RULED OUT, IT WOULD APPEAR THAT AT PRESENT THE OPERATION IN QUESTION INVOLVES ONLY A LIMITED QUANTITY OF BUTTER REPRESENTING LESS THAN 0.4% OF TOTAL MARGARINE CONSUMPTION IN THE FEDERAL REPUBLIC OF GERMANY . IN THOSE CIRCUMSTANCES THE APPLICANTS '
FEARS MUST BE REGARDED AS PREMATURE AND CANNOT THEREFORE JUSTIFY AT THIS STAGE AN APPLICATION FOR SUSPENSION .
21 FINALLY, IT MUST BE POINTED OUT THAT A LARGE PART OF THE BUTTER WHICH IS TO BE OFFERED FOR SALE ON THE BERLIN MARKET HAS ALREADY BEEN THAWED AND IS AT PRESENT HELD BY DISTRIBUTORS WITH THE RESULT THAT SUSPENSION OF THE DECISION WOULD UNDOUBTEDLY GIVE RISE TO PRACTICAL DIFFICULTIES AND WOULD CAUSE DAMAGE TO THE COMMISSION, WHICH MUST BE ASSESSED IN RELATION TO THE DAMAGE ALLEGEDLY SUSTAINED BY THE APPLICANTS .
Operative part
ON THOSE GROUNDS,
THE PRESIDENT,
BY WAY OF INTERIM DECISION,
HEREBY ORDERS AS FOLLOWS :
( 1 ) THE APPLICATION FOR THE ADOPTION OF INTERIM MEASURES IS DISMISSED .
( 2)COSTS ARE RESERVED .