62003TJ0027_EN
Parties
Grounds
Operative part
Parties
In Joined Cases T‑27/03, T‑46/03, T‑58/03, T‑79/03, T‑80/03, T‑97/03 and T‑98/03,
SP SpA,
established in Brescia (Italy), represented by G. Belotti and N. Pisani, lawyers,
applicant in Case T‑27/03,
Leali SpA,
established in Odolo (Italy), represented by G. Vezzoli and G. Belotti, lawyers,
applicant in Case T‑46/03,
Acciaierie e Ferriere Leali Luigi SpA, established in Brescia, represented by G. Vezzoli, G. Belotti, E. Piromalli and C. Carmignani, lawyers,
applicant in Case T‑58/03,
Industrie Riunite Odolesi SpA (IRO),
established in Odolo, represented by A. Giardina, lawyer,
applicant in Case T‑79/03,
Lucchini SpA,
established in Milan (Italy), represented initially by A. Santa Maria and C. Biscaretti di Ruffia, and subsequently by M. Delfino, M. van der Woude, S. Fontanelli and P. Sorvillo, lawyers,
applicant in Case T‑80/03,
Ferriera Valsabbia SpA,
established in Odolo,
Valsabbia Investimenti SpA,
established in Odolo,
represented by D. Fosselard and P. Fattori, lawyers,
applicants in Case T‑97/03,
Alfa Acciai SpA,
established in Brescia, represented by D. Fosselard, P. Fattori and G. d’Andria, lawyers,
applicant in Case T‑98/03,
supported by
Italian Republic,
represented by I. Braguglia and M. Fiorilli, acting as Agents,
intervener,
v
Commission of the European Communities,
represented by L. Pignataro-Nolin and A. Whelan, acting as Agents, and, in Cases T‑27/03 and T‑58/03, by M. Moretto and, in Cases T‑79/03, T‑97/03 and T‑98/03, by P. Manzini, lawyers,
defendant,
APPLICATIONS for a declaration of the non-existence and for annulment in whole or in part of Commission Decision C (2002) 5087 final of 17 December 2002 relating to a proceeding under Article 65 CS (Case COMP/37.956 – Reinforcing bars),
THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES (Fifth Chamber, Extended Composition),
composed of M. Vilaras, President, M.E. Martins Ribeiro, F. Dehousse, D. Šváby and K. Jürimäe, Judges,
Registrar: J. Palacio González, Principal Administrator,
having regard to the written procedure and further to the hearing on 19 September 2006,
gives the following
Judgment
Grounds
Legal framework
ECSC Treaty provisions
1. Article 36 CS provides:
‘Before imposing a pecuniary sanction or ordering a periodic penalty payment as provided for in this Treaty, the Commission must give the party concerned the opportunity to submit its comments.
…’
2. Article 47 CS provides:
‘The Commission may obtain the information it requires to carry out its tasks. It may have any necessary checks made.
…’
3. Article 65 CS provides:
‘1. All agreements between undertakings, decisions by associations of undertakings and concerted practices tending directly or indirectly to prevent, restrict or distort normal competition within the common market shall be prohibited, and in particular those tending:
(a) to fix or determine prices;
(b) to restrict or control production, technical development or investment;
(c) to share markets, products, customers or sources of supply.
2. However, the Commission shall authorise specialisation agreements or joint buying or joint selling agreements in respect of particular products, if [certain conditions are fulfilled] …
3. The Commission may, as provided in Article 47, obtain any information needed for the application of this Article, either by making a special request to the parties concerned or by means of regulations stating the kinds of agreement, decision or practice which must be communicated to it.
4. Any agreement or decision prohibited by paragraph 1 of this Article shall be automatically void and may not be relied upon before any court or tribunal in the Member States.
The Commission shall have sole jurisdiction, subject to the right to bring actions before the Court, to rule whether any such agreement or decision is compatible with this Article.
5. On any undertaking which has entered into an agreement which is automatically void, or has enforced or attempted to enforce ... an agreement or decision which is automatically void ... or has engaged in practices prohibited by paragraph 1 of this Article, the Commission may impose fines or periodic penalty payments not exceeding twice the turnover on the products which were the subject of the agreement, decision or practice prohibited by this Article; if, however, the purpose of the agreement, decision or practice is to restrict production, technical development or investment, this maximum may be raised to 10% of the annual turnover of the undertakings in question in the case of fines, and 20% of the daily turnover in the case of periodic penalty payments.’
4. The ECSC Treaty expired on 23 July 2002, in accordance with Article 97 CS.
Communication from the Commission concerning certain aspects of the treatment of competition cases resulting from the expiry of the ECSC Treaty
5. On 18 June 2002, the Commission adopted a communication concerning certain aspects of the treatment of competition cases resulting from the expiry of the ECSC Treaty (OJ 2002 C 152, p. 5; ‘Communication of 18 June 2002’).
6. Paragraph 2 of the Communication of 18 June 2002 states that its purposes are:
‘− to summarise for economic operators and Member States, in so far as they are concerned by the ECSC Treaty and its related secondary legislation, the most important changes with regard to the applicable substantive and procedural law arising from the transition to the EC regime …
− to explain how the Commission intends to deal with specific issues raised by the transition from the ECSC regime to the EC regime in the areas of antitrust …, merger control … and State aid control.’
7. Paragraph 31 of the Communication of 18 June 2002, which appears in the section addressing specific issues raised by the transition from the ECSC regime to the EC regime, provides as follows:
‘If the Commission, when applying the Community competition rules to agreements, identifies an infringement in a field covered by the ECSC Treaty, the substantive law applicable will be, irrespective of when such application takes place, the law in force at the time when the facts constituting the infringement occurred. In any event, as regards procedure, the law applicable after the expiry of the ECSC Treaty will be the EC law …’
Administrative procedure
8. From October to December 2000, the Commission carried out a number of checks pursuant to Article 47 CS at the offices of certain Italian undertakings engaged in the production of reinforcing bars and at the offices of an association of certain Italian steel undertakings. It also requested them to supply information pursuant to Article 47 CS.
9. On 26 March 2002, the Commission commenced the administrative procedure and adopted its objections under Article 36 CS. The applicants in the present proceedings feature among the addressees of the statement of objections.
10. The applicants have lodged written comments on the statement of objections. All the applicants, with the exception of the applicant in Case T‑80/03, requested the right to express their opinion orally. To this end, the Hearing Officer arranged a hearing on 13 June 2002.
11. On 12 August 2002, the Commission adopted a supplementary statement of objections which was addressed to the same addressees as the first statement. In that supplementary statement of objections, based on Article 19(1) of Council Regulation No 17 [of 6 February 1962]: First Regulation implementing Articles [81] and [82] of the Treaty (OJ, English Special Edition 1959-1962, p. 87), the Commission explained its position concerning the further proceedings following expiry of the ECSC Treaty.
12. The applicants submitted written comments on the supplementary statement of objections. A second hearing, in the presence of representatives of the Member States, took place on 30 September 2002.
Contested decision
13. On 17 December 2002, the Commission adopted Decision C (2002) 5087 final relating to a proceeding under Article 65 CS (Case COMP/37.956 – Reinforcing bars; ‘the contested decision’).
14. The preamble to the contested decision reads as follows:
‘Having regard to the Treaty establishing the European Coal and Steel Community, and in particular Article 65 thereof,
Having regard to the information obtained by the Commission and the checks made by Commission officials under Article 47 of the Treaty,
Having regard to the written and oral comments submitted in the name and on behalf of the parties concerned under Article 36 of the ECSC Treaty,
After consulting the Advisory Committee on Restrictive Practices and Dominant Positions,
…’
15. With regard to the legal consequences of the expiry of the ECSC Treaty, the Commission referred first of all, in recital 331 of the contested decision, to paragraph 31 of the Communication of 18 June 2002.
16. The Commission then examined in recitals 333 to 344 of the contested decision whether the application of Article 65 CS to the conduct complained of could not be contested on the basis of the lex mitior
principle (principle of the application of the more lenient penalty).
17. It pointed out in this regard in paragraph 335 of the contested decision that ‘the two provisions of the ECSC Treaty which might in the abstract be considered less favourable [were, first,] Article 65(1) CS, because for the infringement it contemplates to take place it does not require, as Article 81(1) EC does, that the restrictive practice be such as to affect trade between Member States; … and [, second,] Article 65(5) CS, because the fines it [allowed] may amount to up to twice the turnover on the products which were the subject of the restrictive practice: Article 15 of Council Regulation No 17 does not allow such fines …’
18. Having concluded in recitals 337 to 341 of the contested decision that the agreement referred to therein was capable of affecting trade between Member States, the Commission, in recital 343 of the decision, indicated that ‘it [had] formally advised the parties that it [did] not … intend to impose on any undertaking a fine greater than 10% of the annual turnover achieved using ECSC products on the territory of the European Union’ and that ‘that ceiling is in fact laid down in Article 65(5) CS for restrictive practices which seek to restrict production, as does the one at issue here; and it [was] more favourable to the undertakings than the limit laid down in Article 15 of Council Regulation No 17 of 6 February 1962, which sets a maximum of 10% of the undertaking’s annual turnover in all products throughout the world’.
19. It concluded, in recital 344 of the contested decision, that, ‘the application of the EC [Treaty] would not in the particular case under consideration be more favourable, and that even if the view were to be taken that the principle of the lex mitior
could be applied, that principle cannot in any event be invoked in order to contest the application of substantive ECSC law to the addressees’ conduct’.
20. With regard to its competence to apply the competition rules of the ECSC Treaty following its expiry, the Commission explained in recitals 348 to 352 of the contested decision that:
‘348
… the EC Treaty and the ECSC Treaty belong to the same legal order, l’ordre juridique communautaire, and that in the framework of this new order the ECSC Treaty was to be considered lex specialis
until the 23 [July] 2002. That means that starting from 24 [July] 2002 all the sectors that previously belonged to the application area of the ECSC Treaty, of its procedural laws and of its remaining secondary legislation are now submitted to the provisions of the EC Treaty, which constitutes the general rule.
349 It has to be underlined that on 8 April 1965 the Member States signed a Treaty to establish a single Council and a single Commission of the European Communities. It is also worth remembering that Article 3 EU states that “The Union shall be served by a single institutional framework which shall ensure the consistency and the continuity of the activities carried out in order to attain its objectives while respecting and building upon the acquis communautaire .” Moreover, Article 305(1) EC states that “The provisions of this Treaty shall not affect the provisions of the Treaty establishing the European Coal and Steel Community, in particular as regards the rights and obligations of Member States, the powers of the institutions of that Community and the rules laid down by that Treaty for the functioning of the common market in coal and steel.”
350 The consequences of the expiry of the lex specialis
for the provisions which authorise the Commission to impose sanctions need to be analysed more in detail. In this case, it appears to be justified to apply the substantive law in force at the time of the infringement, while the procedural applicable law is the one in force at the time of the decision.
351 With its Communication of 18 June 2002 the Commission did not claim, nor could it have claimed, to establish transitional rules. The Commission simply explained ex ante, in an effort of transparency, in which way, on the basis of the general principles of law, the transition between the two treaties would take place.
352 From this perspective, the application of Regulation No 17 to the remaining part of the procedure follows the principle that the applicable procedural laws are the one[s] in force at the moment of the adoption of the measure in question. Following the same reasoning, it did not appear necessary to repeat the first hearing in which the representatives of the Member States did not participate, because the ECSC procedural law, which was in force at that time, did not provide for such participation. Moreover, as stated in the Communication [of 18 June 2002] (paragraph 26), we should consider that the procedural measures correctly taken under ECSC provision[s] may satisfy, once the ECSC Treaty expired, the requirements of the correspondent procedural provisions of the EC Treaty. Lastly, it must be underlined that there is no formal link between the provisions concerning the participation of the Member States at [a] hearing (Article 11 of Commission Regulation (EC) No 2842/98 of 22 December 1998 on the hearing of parties in certain proceedings under Articles [81] and [82] of the EC Treaty [OJ 1998 L 354, p. 18]) and those concerning the consultation of the Advisory Committee (Article 10 Regulation No 17).’
21. After having examined, in recitals 358 to 513 of the contested decision, the applicability of Article 65(1) CS to the conduct of the undertakings and of the association of undertakings mentioned therein, the Commission stated in recital 514:
‘Under Article 65(2) CS, the Commission is to authorise specialisation agreements or joint buying or joint selling agreements that are strictly analogous in nature and effect, provided they satisfy certain requirements. The restrictive practice described in this statement of objections cannot be authorised as it is not one of the types of agreement for which such authorisation can be granted. It is an agreement aimed at fixing or determining prices, restricting or controlling production and sharing markets. Furthermore, the Commission has not received any application for authorisation under the relevant article of the ECSC Treaty.’
22. With regard to the applicability of Article 65(5) CS, the Commission expressed the following opinion in recitals 515 to 518 of the contested decision:
‘515 In accordance with Article 65(5) CS, the Commission may impose fines on any undertaking which has entered into an agreement which is automatically void, or has enforced or attempted to enforce an agreement or a decision of an association of undertakings which is automatically void or has engaged in practices prohibited by Article 65(1) CS. The Commission may impose fines not exceeding twice the turnover on the products which were the subject of the agreement, decision or practice prohibited by Article 65(1) CS; if, however, the purpose is to limit production, technical development or investment, the maximum may be raised to 10% of the annual turnover of the undertakings in question.
516 The problem concerning the involvement of an association [of undertakings] in a procedure relating to the infringement of the competition rules established by the ECSC Treaty was already tackled by the Court of First Instance in the Eurofer
case (Case T-136/94 Eurofer v Commission
[1999] ECR II-263): “Article 65(1) CS prohibits ‘All agreements between undertakings, decisions by associations of undertakings and concerted practices tending directly or indirectly to prevent, restrict or distort normal competition within the common market’. Article 65(4) CS provides that: ‘Any agreement or decision prohibited by paragraph 1 of this Article shall be automatically void and may not be relied upon before any court or tribunal in the Member States. The Commission shall have sole jurisdiction, subject to the right to bring actions before the Court, to rule whether any such agreement or decision is compatible with this Article’. Article 65(5) CS provides that: ‘On any undertaking which has entered into an agreement which is automatically void, or has enforced or attempted to enforce ... an agreement or decision which is automatically void ... or has engaged in practices prohibited by paragraph 1 of this Article, the Commission may impose fines or periodic penalty payments ...’ Although it does indeed follow from Article 65(5) CS that an association of undertakings cannot be made the subject of a fine or a periodic penalty payment, there is nothing in the wording of Article 65(1) CS to support the view that an association which has adopted a decision tending to prevent, restrict or distort normal competition is not itself covered by the prohibition laid down in that provision. That interpretation is confirmed both by Article 65(4) CS, which also refers to such decisions, and by the judgment in Case 67/63 Sorema
v High Authority [1964] ECR 151, in which the Court of Justice held that Article 65(1) of the Treaty also [applied] to associations to the extent to which their own activity or that of their member undertakings tends to produce the effects referred to therein (at p. 162). That finding is also confirmed, according to the Court of Justice, by Article 48 CS, which allows associations to engage in any activity not contrary to the Treaty. Contrary to what the applicant contends, it also follows from the judgment in Sorema
v High Authority
that an association of undertakings within the meaning of Article 65(1) of the Treaty may be the addressee of a decision authorising an agreement pursuant to Article 65(2) CS (pp. 161-165). The applicant’s argument that an association of undertakings within the meaning of Article 65(1) CS cannot infringe the prohibition laid down in that provision must therefore be rejected.”
517 It can therefore be concluded that if it is true that the Commission cannot inflict a fine on an association of undertakings, the same association can nevertheless be the addressee of a decision whenever it is certain that it has been involved in the infringement …
518 Concerning the undertakings, the elements to be taken into account for the calculation of fines are in particular the gravity of the infringement, the duration and the mitigating and aggravating circumstances.’
23. Article 1(1) of the contested decision states as follows:
‘[The 11 undertakings and the association of undertakings which include the applicants] implemented a single, complex and continuous restrictive practice on the Italian market for concrete reinforcing bars in bars and coils having as its object or effect the fixing of prices, with a view to which the restriction or control of output and/or sales was also concerted.
Having as its object the restriction and distortion of normal competition within the common market, that restrictive practice is contrary to Article 65(1) CS.’
24. According to Article 1(2) of the contested decision, the infringement lasted from 6 December 1989 to 27 June 2000 for the applicants in Cases T‑27/03, T‑46/03, T‑58/03, T‑79/03, T‑80/03 and T‑97/03 and from 6 December 1989 to 4 July 2000 for the applicant in Case T‑98/03.
25. It follows from Article 2 of the contested decision that fines amounting to EUR 85.04 million in total were imposed on the undertakings referred to in Article 1(1) of the contested decision, which included the applicants.
Procedure
26. By applications lodged at the Court Registry between 31 January and 10 March 2003, the applicants brought the present actions.
27. By separate documents lodged at the Court Registry on 8 and 15 May 2003 respectively, the applicants in Cases T‑79/03 and T‑46/03 applied for suspension of the operation of the contested decision.
28. By orders of the President of the Court of 5 August 2003 (Case T‑79/03 R IRO
v Commission
[2003] ECR II‑3027), and 20 October 2003 (Case T‑46/03 R Leali
v Commission [2003] ECR II‑4473), the applications for interim measures were dismissed and the costs were reserved.
29. By document lodged with the Court Registry on 16 June 2004, the Italian Republic applied for leave to intervene in support of the form of order sought by the applicant in each case.
30. By order of the President of the First Chamber of the Court of 27 July 2004, the Italian Republic was allowed to intervene in support of the form of order sought by the applicant in each case. It submitted its observations during the oral procedure on the basis of the Report for the Hearing, in accordance with Article 116(6) of the Court’s Rules of Procedure.
31. By document lodged at the Court Registry on 18 October 2005, the applicant in Case T‑46/03 made a further application for suspension of the operation of the contested decision. That application was dismissed by order of the President of the Court of 24 January 2006 (T‑46/03 R II Leali
v Commission
(not published in the ECR)).
32. Pursuant to Article 14(1) of the Rules of Procedure and acting on a proposal from the Fourth Chamber, the Court decided, after the parties had been heard in accordance with Article 51(1) of those rules, to refer the case to a chamber with an extended composition.
33. By order of 6 July 2006, after the parties had been heard, the President of the Fifth Chamber of the Court ordered the joining of Cases T‑27/03, T‑46/03, T‑58/03, T‑79/03, T‑80/03, T‑97/03 and T‑98/03 for the purposes of the oral procedure and the judgment.
34. On hearing the report of the Judge-Rapporteur, the Court decided to hear the parties, first of all with regard to the plea which alleges that the Commission lacked the competence to adopt the contested decision. By way of measures of organisation of procedure provided for in Article 64 of the Rules of Procedure, it put a written question to the Commission, which replied to it within the prescribed time-limit.
35. The parties presented oral argument and answered the questions put to them by the Court at the hearing on 19 September 2006.
Forms of order sought by the parties
36. The applicant in Case T-27/03 claims that the Court should:
– on the substance, declare non-existent and/or null and void or, in any event, annul the contested decision on the grounds of lack of competence, abuse and misuse of powers;
– in the alternative and on the substance, annul the contested decision, in particular with regard to the sanction, on grounds of erroneous definition of the geographic market, lack of reasoning, misapplication of law, unfounded character – especially from the perspective of evidence – of the objections made, infringement of the principle of impartiality of administrative action and of the rights of the defence;
– in the further alternative and on the substance, annul the fine on the ground that it is unreasonable and based on insufficient investigations and reasons or, in any case, reduce the fine imposed on the applicant, by in the first place removing the increase of 225% for deterrence and the increase of 105% for duration and by reducing, in due proportion, the basic amount on the grounds of a time-bar, the lesser gravity of the infringement, the marginal nature of its participation in the restrictive practice and the objections expressly not upheld against it;
– order the defendant, in any event, to bear the costs.
37. The applicant in Case T-46/03 claims that the Court should:
– annul the contested decision;
– in the alternative, reduce the amount of the fine imposed, taking account of the fact that the allegations upheld against Acciaierie e Ferriere Leali Luigi SpA cannot be imputed to it, of the erroneous application of the increase for duration to the whole of the basic fine, and of its precarious and particular financial situation;
– order the Commission to bear the applicant’s costs.
38. The applicant in Case T-58/03 claims that the Court should:
– annul the contested decision;
– in the alternative, reduce the amount of the fine imposed, taking account of the impossibility of imputing to it actions put into effect after its liquidation, that is for the period between 25 November and 4 December 1998, and taking account of the erroneous application of the increase for duration to the whole of the basic fine, and of its particular financial situation;
– order the Commission to pay the applicant’s costs.
39. The applicant in Case T-79/03 claims that the Court should:
– annul the contested decision on the grounds of the Commission’s lack of powers and manifest lack of competence, in that the contested decision was adopted with reference to a non-existent legal basis and in the absence of any provision which, following expiry of the ECSC Treaty, gave the Commission the power to take a decision under Article 65 CS;
– annul the contested decision on the grounds of ultra vires, erroneous, contradictory and distorted application of the law, in that the Commission, for the purposes of the application of Article 65 CS, relied on the rules of procedure provided for by Regulation No 17, whereas those rules are expressly and exclusively reserved for the application of Articles 81 EC and 82 EC, and on the ground of infringement of the provisions of that regulation concerning the function and the parameters of the statement of objections, and with reference to the participation of the national authorities, from which it follows that the entire procedure followed by the Commission is incomplete, incoherent and unlawful;
– annul the contested decision on the ground of misuse of powers arising from inadequate investigations and reasoning, which led to the erroneous definition of the relevant market and the contradictory and illogical nature of the conditions and constituent elements of the alleged unlawful agreement;
– in the alternative, annul the contested decision on the ground of infringement of the law arising from inadequate investigations in the part of the decision in which it is held responsible for an anti-competitive agreement during the period from 1989 to 1996 inclusive, whereas there is no evidence proving its participation in the alleged illegal activity; consequently, reduce the fine imposed on it proportionately;
– in the alternative, annul or reduce the fine imposed on it in the contested decision on the grounds of infringement of the principles of equal treatment, of the protection of legitimate expectations, of proportionality and of the appropriate determination of the sanction;
– order the Commission to bear the costs.
40. The applicant in Case T‑80/03 claims that the Court should:
– declare non-existent and/or null and void and, in any case, annul the contested decision ordering it, together with SP SpA, formerly Siderpotenza SpA, to pay a fine of EUR 16.14 million on the ground that it put into effect, jointly with other enterprises, a single, complex and continuous agreement concerning the Italian market in concrete reinforcing bars in bars or coils, having as its object or effect the fixing of prices and according to which it also agreed to limit or control output or sales, in that the ECSC Treaty had expired before adoption of the contested decision;
– in the alternative, annul the contested decision, in particular as regards the fine, on the grounds of lack of competence, misuse of powers and manifest ultra vires acts on the part of the Commission and on the ground of erroneous application of Article 65 CS and the lack of and/or contradictory nature of reasoning in relation to it;
– in the further alternative, reduce the fine imposed on it by the Commission on the basis of its turnover, on the ground of erroneous application of Article 65(5) CS;
– in any case, order the Commission to bear the costs.
41. The applicants in Cases T-97/03 and T-98/03 claim that the Court should:
– annul Article 1 of the contested decision to the extent that it applies to them;
– in the alternative, annul Article 1 of the contested decision to the extent that it imputes to them participation in an infringement before 13 February 1996;
– annul Article 2 of the contested decision to the extent that it applies to them;
– in the alternative, amend Article 2 of the c ontested decision so that the fine imposed is annulled or substantially reduced;
– order the Commission to bear the costs.
42. The Commission contends in each case that the Court should:
– dismiss the action;
– order the applicant to pay the costs.
Law
43. In support of their submissions, all the applicants rely on a plea of lack of competence of the Commission to find that there was an infringement of Article 65 CS at the time of the adoption of the contested decision.
44. The different arguments raised in relation to that plea can be regrouped in four parts. The first part, which is relied upon in each case, alleges lack of competence of the Commission to apply the competition rules of the ECSC Treaty following its expiry. The second part, raised in Cases T‑27/03, T‑46/03 and T‑58/03, alleges the unlawfulness of the Communication of 18 June 2002 in so far as it prolongs the applicability of Article 65 CS beyond the expiry of the ECSC Treaty. The third part, raised in Cases T‑27/03, T‑79/03, T‑97/03 and T‑98/03, alleges unlawful continuation of proceedings on the basis of Regulation No 17 following expiry of the ECSC Treaty. The fourth part, raised in Cases T‑46/03, T‑58/03, T‑97/03 and T‑98/03, alleges the infringement of the lex mitior principle. The first part of this plea will now be analysed.
Arguments of the parties
45. In each case, the applicant points out that Community action must be founded on a specific legal basis. The applicants observe that the contested decision refers exclusively to the provisions of the ECSC Treaty, in particular Article 65 of that treaty. Given that, when the contested decision was adopted, on 17 December 2002, the ECSC Treaty was no longer part of the Community legal order, that treaty could no longer serve as the legal basis for the decision.
46. The applicants explain that, pursuant to Article 97 CS, the legal system established by the ECSC Treaty automatically and completely ceased to exist on 23 July 2002. Since the legal rules conferring its competences had expired, the Commission lacked any competence to apply Article 65 CS when it adopted the contested decision. The present proceedings therefore do not concern succession of laws within a single legal system, but a problem connected to expiry of a treaty and to the extinction of the legal system pertaining to it.
47. According to the applicants, only the signatory States to the ECSC Treaty could take the sovereign decision if and under what conditions the European Community could be subrogated to the rights, obligations and prerogatives of the European Coal and Steel Community (ECSC). The applicants in Cases T‑27/03, T‑79/03, T‑80/03, T‑97/03 and T‑98/03 refer in that regard to international law, and in particular to Articles 54 and 70 of the Vienna Convention on the Law of Treaties of 23 May 1969 ( United Nations Treaty Series, Vol. 1155, p. 331). The principles of international law constitute a valuable source of inspiration for interpreting the provisions of Community law (Case C-286/90 Poulsen and Diva Navigation [1992] ECR I-6019, paragraph 9, and Case T-115/94 Opel Austria
v Council
[1997] ECR II-39, paragraphs 89 to 95).
48. In that context, the applicants in Cases T‑46/03, T‑58/03, T‑79/03 and T‑80/03 point out, first, that the Commission took the position, in communication COM(2000) 588 final of 27 September 2000, entitled ‘The future of structured dialogue after the expiry of the ECSC Treaty’, that the ‘starting point of any analysis [relating to the expiry of the ECSC Treaty] must be the willingness of the Member States not to extend the life of the ECSC regime and bodies beyond the time-limit laid down in the treaty.’
49. Second, all the applicants refer to one or other protocol, decision or regulation expressly adopted by the Member States or the Council in order to regulate the consequences of the expiry of the ECSC Treaty. The acts concerned are the following:
– Protocol on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund for Coal and Steel, annexed to the Treaty of Nice, relied upon by the applicant in Case T‑79/03;
– Decision 2002/234/ECSC of the Representatives of the Governments of the Member States, meeting within the Council, of 27 February 2002, on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund for Coal and Steel (OJ 2002 L 79, p. 42), relied upon by all the applicants;
– Decision 2002/595/EC of the Representatives of the Governments of the Member States, meeting within the Council, of 19 July 2002 on the consequences of the expiry of the Treaty establishing the European Coal and Steel Community (ECSC) on international agreements concluded by the ECSC (OJ 2002 L 194, p. 35), relied upon by the applicants in Cases T‑27/03, T‑46/03, T‑58/03, T‑79/03 and T‑80/03;
– Council Regulation (EC) No 963/2002 of 3 June 2002 laying down transitional provisions concerning anti-dumping and anti-subsidy measures adopted pursuant to Commission Decisions No 2277/96/ECSC and No 1889/98/ECSC as well as pending anti-dumping and anti-subsidy investigations, complaints and applications pursuant to those decisions (OJ 2002 L 149, p. 3), relied upon by the applicants in Cases T‑27/03, T‑79/03 and T‑80/03;
– Council Regulation (EC) No 1407/2002 of 23 July 2002 on State aid to the coal industry (OJ 2002 L 205, p. 1), relied upon by the applicants in Cases T‑80/03, T‑97/03 and T‑98/03;
– Regulation (EC) No 1840/2002 of the European Parliament and of the Council of 30 September 2002 on the prolongation of the ECSC steel statistics system after the expiry of the ECSC Treaty (OJ 2002 L 279, p. 1), relied upon by the applicant in Case T‑79/03;
– Council Regulation (EC) No 405/2003 of 27 February 2003 concerning Community monitoring of imports of hard coal originating in third countries (OJ 2003 L 62, p. 1), relied upon by the applicant in Case T‑79/03.
50. By contrast, the Member States did not take any measure prolonging the competition rules established by the ECSC Treaty or envisaging a transitional regime for those provisions. In the absence of any decision of the signatory States to the ECSC Treaty on the applicability of Article 65 CS after expiry of that treaty, the Commission was no longer competent to apply that provision. In other words, by adopting the contested decision, the Commission prolonged the validity of Article 65 CS, which was no longer in force, without there being any legal act authorising it explicitly to do so.
51. The applicants in Cases T‑46/03, T‑58/03, T‑79/03, T‑80/03, T‑97/03 and T‑98/03 stress that, notwithstanding their common inspiration and the requirement that they be interpreted according to clearly coherent criteria, the ECSC, EC and EAEC Treaties are distinct and autonomous treaties conferring distinct and well‑defined competences on the Community institutions. Each treaty, considered individually, constitutes a complete and autonomous system of legal rules, the concrete implementation and application of which takes place fully and entirely within its own specific framework. Article 3 EU and Article 305 EC bear witness to the autonomous character of the different treaties.
52. With regard to the Commission’s argument regarding the Treaty of 8 April 1965 establishing a Single Council and a Single Commission of the European Communities (‘Merger Treaty’), which has in the meantime been repealed by Article 9 of the Treaty of Amsterdam, the applicants in Cases T‑46/03, T‑58/03, T‑79/03, T‑80/03, T‑97/03 and T‑98/03 submit that, despite the merger of the institutions, the different Communities have remained separate and distinct. The Commission continued to exercise distinct competences and to act pursuant to distinct powers when it acted in the framework of one or other Community (Case C-327/91 France
v Commission
[1994] ECR I-3641). It is contradictory to argue that the competition sector passed automatically from the ECSC Treaty regime to the EC Treaty regime because of the supposed indivisibility of the Community legal order when, in relation to other matters, a specific decision of the Member States was required.
53. The applicants in Cases T‑46/03 and T‑58/03 also contest the characterisation of the ECSC Treaty as lex specialis
(recital 348 of the contested decision) in relation to the EC Treaty since the ECSC Treaty was signed before the EC Treaty. The case-law referred to by the Commission in its defence is not concerned in any way with the hypothesis of the expiry of the ECSC Treaty and only serves to confirm that it was intended to regulate only the market in coal and steel, whereas the EC Treaty regulated all other sectors. In any case, if the ECSC Treaty constituted a lex specialis
in relation to the EC Treaty, the expiry of the ECSC Treaty would have entailed that the Commission should have applied Article 81 EC in the contested decision.
54. With regard to Article 305 EC which, according to the Commission, confirms the nature of the ECSC Treaty as lex specialis, the applicants in Cases T‑97/03 and T‑98/03 submit that it is a clause of complete compatibility, specific to customary law and codified in Article 30(2) of the Vienna Convention. Article 305 EC is thus designed to avoid the later treaty – the EC Treaty – taking precedence over the earlier treaty – the ECSC Treaty – in the sectors governed by the ECSC Treaty. That provision, however, does not empower the Commission to apply the ECSC Treaty following its expiry.
55. The Commission points out that the EC Treaty and the ECSC Treaty form part of one and the same legal system, that is to say the Community legal order (Opinion 1/91 [1991] ECR I‑6079, paragraph 21). It explains that, given the unique character of that legal order, the Community judicature has interpreted the provisions of the ECSC and EAEC Treaties with reference to the provisions of the EC Treaty on the basis of common principles to which all the Community treaties adhere (Case C-221/88 Busseni
[1990] ECR I‑495, paragraphs 16 and 21). Article 65 CS has therefore been interpreted consistently with Article 81 EC (Case 13/60 Geitling Ruhrkohlen-Verkaufsgesellschaft and Others
v High Authority
[1962] ECR 83; Case T-141/94 Thyssen Stahl
v Commission
[1999] ECR II‑347, paragraphs 262, 266 and 277).
56. The unique character of the Community legal order is moreover confirmed by the unified institutional structure. The Commission refers in that connection to the Merger Treaty and to the third paragraph of Article 1 EU, Article 3(1) EU and Articles 48 EU and 49 EU.
57. The Commission submits that, within the Community legal order, the ECSC Treaty constitutes a lex specialis
which derogates from the lex generalis
of the EC Treaty. It refers in that regard to Article 305(1) EC and to case-law (Case 239/84 Gerlach
[1985] ECR 3507, paragraphs 9 to 11; Opinion 1/94 [1994] ECR I‑5267, paragraphs 25 to 27; Opinion of Advocate General Van Gerven in Case C-128/92 Banks
[1994] ECR I‑1209, point 8; Case T-6/99 ESF Elbe-Stahlwerke Feralpi
v Commission
[2001] ECR II‑1523, paragraph 102; and Case T‑374/00 Verband der freien Rohrwerke and Others
v Commission
[2003] ECR II‑2275, paragraph 68). The Commission submits that, on the expiry of the lex specialis, on 23 July 2002, the lex generalis
constituted by the EC Treaty attained the fully extended scope which Article 305 EC had limited throughout the period of validity of the ECSC Treaty, with the result that the sectors which previously came under the ECSC Treaty became subject, as from the expiry of the ECSC Treaty, to the corresponding legal rules of the EC Treaty. In that regard, the Commission refers to recital 348 of the contested decision.
58. The reference to international law, and in particular to Articles 54 and 70 of the Vienna Convention, fails to have regard to the sui generis nature of the Community legal order (Case 6/64 Costa
[1964] ECR 585 and Joined Cases 90/63 and 91/63 Commission
v Luxembourg and Belgium
[1964] ECR 625). The indivisibility of the Community legal order and the lex specialis
to lex generalis
relationship between the ECSC and EC Treaties mean that the consequences of the expiry of the ECSC Treaty are not governed by the rules of international law but must be assessed in the light of the provisions existing within the Community legal order.
59. The case-law cited by the applicants in support of their arguments, according to which international law can also apply within the area covered by Community law, is therefore not relevant, since it concerns the relationships between the Community and third countries and not relationships originating within the Community legal order.
60. When the ECSC Treaty expired, the transition between the competition regime covered by the ECSC Treaty and that covered by the EC Treaty took place automatically on the basis of the principle of succession of legal rules within the same legal system. In that regard, the Commission observes that procedural rules are generally held to apply to all proceedings pending at the time when they enter into force, whereas substantive rules are usually interpreted as not applying to situations existing before their entry into force (Joined Cases 212/80 to 217/80 Salumi and Others
[1981] ECR 2735, paragraph 9; Joined Cases C-121/91 and C‑122/91 CT Control (Rotterdam) and JCT Benelux
v Commission
[1993] ECR I‑3873, paragraph 22; and Case C-61/98 De Haan
[1999] ECR I-5003, paragraph 13).
61. In accordance with those principles, the Commission applied, after expiry of the ECSC Treaty, the procedural rules of Regulation No 17. As regards the substantive provisions, the contested decision concerned an agreement which was implemented until 2000. The sole provision infringed by the addressees of the contested decision was therefore Article 65(1) CS. In other words, Article 81 EC was not mentioned in the contested decision because Article 65 CS was the substantive provision in force when the anti-competitive conduct was implemented. The Commission also submits that the fact that an administrative procedure for applying Article 65 CS to events which occurred while the ECSC Treaty was in force necessitated the application of time-limits in a period after the expiry of the ECSC Treaty cannot have the effect of depriving Article 65 CS of its essential effectiveness well before the date of expiry of that treaty and of rendering ineffective the obligation not to distort the competitive obligation which that article imposes directly on every economic operator.
62. The application of Article 65 CS to infringements committed before the expiry of the ECSC Treaty is therefore the logical and coherent consequence of the principles concerning the succession of legal rules within the same legal system. The Commission stresses that it was legally entitled to adopt the contested decision, as it remained, after expiry of the ECSC Treaty, the body competent under the EC Treaty for applying the competition rules. It also states that it limited itself to applying those rules of the ECSC Treaty which have a clear equivalent in the EC Treaty. Furthermore, the Court of Justice itself continued to apply Article 65 CS, after its expiry, to events which occurred during the period when it was still in force (see, for example, Joined Cases C-172/01 P, C-175/01 P, C‑176/01 P and C-180/01 P International Power and Others
v NALOO
[2003] ECR I‑11421, paragraph 168, and Case C‑179/99 P Eurofer
v Commission
[2003] ECR I‑10725, paragraphs 22 to 26).
63. The communication on the future of structured dialogue after the expiry of the ECSC Treaty refers to conduct and situations which might take place after expiry of the ECSC Treaty. By contrast, the contested decision is limited to establishing the existence of an infringement and to imposing a sanction for conduct which occurred when the ECSC Treaty was fully in force.
64. With regard to the measures mentioned in paragraph 49 above in support of the applicants’ argument that, in the absence of a specific decision of the Member States or of the Council, the Commission was no longer competent to apply Article 65 CS after the expiry of the ECSC Treaty, the Commission maintains that the adoption of Decision 2002/234 is linked to the fact that the transfer of the assets of the ECSC to the European Community could not occur automatically given that the EC Treaty does not contain any provision capable of automatically subrogating the European Community to the rights and obligations attaching to ECSC assets. In the absence of a specific decision, ECSC funds would be returned to the Member States on the date of expiry of the ECSC Treaty (see recital 1 in the preamble to Decision 2002/234 and Commission communication COM(2000) 518 final of 6 September 2000). The adoption of an ad hoc act by the Member States, as subsequently occurred by virtue of Protocol C to the Nice Treaty, was therefore necessary in order to transfer funds from the ECSC Treaty to the European Community. By contrast, the protection of competition in the coal and steel sectors subject to the ECSC passed automatically to the European Community regime on the expiry of the ECSC Treaty, when the limitation imposed by Article 305 EC on the full scope of the lex generalis came to an end.
65. With regard to Decision 2002/595, the Commission explains that the necessity of making provision for the consequences for international agreements of the expiry of the ECSC Treaty by a separate decision of the Member States emanated, first, from the political will to maintain the ‘specific’ regime provided for under those agreements for the products coming under the ECSC even after expiry of the ECSC Treaty, and, second, from the impossibility on the basis of the EC Treaty for the European Community automatically to declare itself the successor to the ECSC in the relationships with third States, which could not be linked by an ‘internal’ rule of the Community system such as Article 305 EC. Decision 2002/595 therefore explicitly transferred to the European Community the rights and obligations of the ECSC concerning the relationships with third countries. Article 1 of Council Decision 2002/596/EC of 19 July 2002 on the consequences of the expiry of the Treaty establishing the European Coal and Steel Community (ECSC) on the international agreements concluded by the ECSC (OJ 2002 L 194, p. 36) ratified the transfer. The Commission adds that, in accordance with Article 2 of Decision 2002/596, it was bound to inform third countries of the transfer and, where appropriate, to negotiate amendments to the agreements.
66. With regard to the applicants’ arguments concerning Regulation No 963/2002, the Commission maintains that the adoption of that regulation proved necessary because European Community commercial policy is managed by a decision‑making process different from that provided for under the ECSC Treaty. In the former case, competence is conferred on the Council and, in the latter case, on the Commission. Thus, in accordance with Article 74 CS and Article 14 of Commission Decision No 2277/96/ECSC of 28 November 1996 on protection against dumped imports from countries not members of the European Coal and Steel Community (OJ 1996 L 308, p. 11), the provisional and definitive anti‑dumping duties were imposed by the Commission. Furthermore, the adoption of Regulation No 963/2002 can be explained by the Community’s obligations when applying Article VI of the General Agreement on Tariffs and Trade (GATT). The parties concerned in third countries had an interest in knowing whether the maximum time-limit of 18 months for an anti-dumping procedure would be interrupted when the ECSC Treaty expired. Judging that third countries cannot be fully aware either of the implications of Article 305 EC or of the effects of the application of the principle of succession of laws, particularly in view of the institutional differences between the two treaties, the Council adopted Regulation No 963/2002. By contrast, the fact that the body responsible for adopting the measures necessary to protect competition is the same under the ECSC Treaty and the EC Treaty, that is the Commission, enabled the transition between the two treaties to be carried out on the basis of general legal principles. The adoption of Regulation No 963/2002 is, finally, linked to the fact that, contrary to the decisions establishing infringements of the competition rules, the anti-dumping measures provided for under the ECSC Treaty fix for the future the regime relating to the products which are the object of dumping and therefore entail effects which can manifest themselves even after expiry of the ECSC Treaty.
67. Equally, Regulation No 1840/2002 and Regulation No 405/2003 also apply to conduct and situations which occurred after expiry of the ECSC Treaty. By contrast, the contested decision merely establishes the existence of an infringement and imposes a sanction in respect of a period during which the ECSC Treaty was fully in force.
68. With regard to Regulation No 1407/2002, the Commission explains that it establishes an aid scheme for the sectors covered by the ECSC within the sole framework of the EC Treaty. It contains substantive and procedural rules for the assessment of aid after the expiry of the ECSC Treaty. The transitional regime of Article 14(2), applicable until 31 December 2002, was provided for in order to avoid the successive application in the same year of two aid schemes – that of Commission Decision No 3632/93/ECSC of 28 December 1993 establishing Community rules for State aid to the coal industry (OJ 1993 L 329, p. 12) until 23 July 2002 and that of Regulation No 1407/2002 after that date – a situation which could have created difficulties for undertakings.
69. Finally, the Commission maintains that it still retains competence to establish infringements of Article 65 CS, in so far as they are not time-barred.
Findings of the Court
Preliminary observations
70. It should first of all be pointed out that the Community treaties established a new legal order for the benefit of which the States have limited their sovereign rights in ever wider fields and the subjects of which comprise not only Member States but also their nationals (Opinion 1/91, cited in paragraph 55 above, paragraph 21).
71. Within that Community legal order, the institutions have conferred powers only (Opinion 2/00 [2001] ECR I‑9713, paragraph 5, and Case C‑93/00 Parliament
v Council
[2001] ECR I‑10119, paragraph 39). For that reason, Community measures refer in their preamble to the legal basis which enables the institution concerned to act in the field in question. The choice of the appropriate legal basis has constitutional significance (Opinion 2/00, paragraph 5).
72. In the present case, the contested decision, which was adopted on a date after the ECSC Treaty had expired, establishes an infringement of Article 65(1) CS and imposes a fine on the undertakings alleged to have contravened that provision. Having regard to the arguments relied upon in the context of the present plea, it is first necessary to identify the legal basis on which the contested decision is founded. It will then be examined whether the legal basis used conferred competence on the Commission to establish and sanction an infringement of Article 65(1) CS at the time when the contested decision was adopted.
The legal basis on which the contested decision is founded
73. It must be noted that the preamble to the contested decision contains references only to provisions of the ECSC Treaty, that is Articles 65 CS, 47 CS and 36 CS.
74. It should be recalled, first, that Article 47 CS empowers the Commission to obtain the information it requires to carry out its tasks and to have any checks made and, secondly, that Article 36 CS obliges the Commission to hear the party concerned before imposing a pecuniary sanction or ordering a periodic penalty payment. The references to those provisions in the preamble to the contested decision therefore concern procedural steps carried out before the contested decision was adopted.
75. With regard to Article 65 CS, it must be pointed out not only that it contains a substantive provision addressed to undertakings and associations of undertakings prohibiting anti-competitive conduct (paragraph 1), but also that it provides a legal basis for action by the Commission. In that regard, Article 65(4) CS empowers the Commission to establish an infringement of Article 65(1) CS. Moreover, Article 65(5) CS authorises the Commission to fine undertakings which have contravened Article 65(1) CS.
76. Having regard to the provisions referred to in the preamble, it must be held that the contested decision, which establishes that Article 65(1) CS has been infringed and which imposes fines on the undertakings alleged to have contravened that provision, has Article 65(4) CS as its legal basis with regard to the finding of the infringement and Article 65(5) CS with regard to the imposition of the fine. In addition, the Commission acknowledged at the hearing that the reference to Article 65 CS in the preamble to the contested decision concerns paragraphs 4 and 5 of that provision.
77. Nevertheless, at the hearing, the Commission maintained that the legal basis of the contested decision can also be found in Regulation No 17.
78. In that regard, it must be pointed out that Article 3 of Regulation No 17, a regulation which in the meantime has been repealed by Article 43 of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC] (OJ 2003 L 1, p. 1), confers on the Commission the competence to find that there is an infringement of Article 81 EC or 82 EC, and that Article 15(2) of Regulation No 17 confers on the same institution the competence to impose fines on undertakings and associations of undertakings which have participated in such infringements.
79. It must be pointed out that neither the preamble to nor the grounds of the contested decision contains a reference to Article 3 or Article 15(2) of Regulation No 17 as a legal basis. The only references to Article 15(2) of Regulation No 17, appearing in recitals 335 and 343 of the contested decision, concern the discussion of the lex mitior
in order to justify, in the present case, the application of Article 65(5) CS and not of Article 15(2) of Regulation No 17.
80. At the hearing, the Commission first characterised the omission of a reference to Regulation No 17 in the preamble to the contested decision as a technical error, then as a procedural error or even as a slip of the pen. Next, it explained that the contested decision has to be read in the light of the second statement of objections of 12 August 2002 which, for its part, was based on Regulation No 17. Finally, in response to a question from the Court, the Commission identified the passages of the contested decision which, according to it, demonstrate that the contested decision is based on Article 3 and Article 15(2) of Regulation No 17. The passages in question are, first, the reference to the Advisory Committee in the preamble to and, second, recitals 335, 342, 343, 345, 346, 348 to 350, 352 and 353 of the contested decision.
81. It must therefore be examined whether the factors identified in the preceding paragraph demonstrate to the requisite legal standard that the Commission also based the contested decision on Article 3 and Article 15(2) of Regulation No 17, notwithstanding the omission of express references to that effect in the contested decision.
82. In the first place, it should be noted that, after having been questioned on the point at the hearing, the Commission acknowledged that the statements contained in the various recitals referred to in paragraph 80 of this judgment concerned the applicable substantive (recitals 335, 342 and 343) or procedural law (recitals 352 and 353) and not specifically its competence to determine and sanction an infringement of Article 65(1) CS after expiry of the ECSC Treaty. Next, it acknowledged that recitals 345 and 346 merely reproduced the arguments developed by the applicants in the course of the administrative procedure.
83. Secondly, with regard to recitals 348 and 349 of the contested decision, it must be pointed out that they contain general references to the lex specialis, to the Merger Treaty and to Article 305 EC, but do not contain any statement to the effect that the contested decision is based on Article 3 and on Article 15(2) of Regulation No 17.
84. Thirdly, the reference to the Advisory Committee in the preamble to the contested decision is a reference to a procedural step provided for in Article 10(3) of Regulation No 17 and therefore confirms that the Commission applied the procedural rules of Regulation No 17 after the expiry of the ECSC Treaty, whereas the references to Articles 36 CS and 47 CS in the same preamble confirm that, before the expiry of the ECSC Treaty, the ECSC Treaty’s procedural rules were applied.
85. Nevertheless, the reference to the Advisory Committee does not at all indicate that, in the present case, the Commission also based its competence on Article 3 and Article 15(2) of Regulation No 17. The only indication in the preamble to the contested decision as to the legal basis used by the Commission in order to establish and sanction the infringement concerned is in fact Article 65 CS. It must be recalled in that regard that at the hearing the Commission acknowledged that the reference to Article 65 CS in the preamble concerned paragraph 4 of that article, with regard to the infringement, and paragraph 5 of that article, with regard to the imposition of the fine.
86. Fourthly, at the hearing, the Commission emphasised, in particular, the first sentence of recital 350, as being an implicit but clear indication that the contested decision is based on Article 3 and Article 15(2) of Regulation No 17.
87. It should be recalled that recital 350 of the contested decision is worded as follows:
‘The consequences of the expiry of the lex specialis
for the provisions which authorise the Commission to impose sanctions need to be analysed more in detail. In this case, it appears to be justified to apply the substantive law in force at the time of the infringement, while the procedural applicable law is the one in force at the time of the decision.’
88. It must first of all be noted that recital 350 of the contested decision concerns only the competence of the Commission to impose fines. The first sentence of recital 350 refers only to ‘provisions which authorise the Commission to impose sanctions’. The second sentence of that recital, which is said to further explain the Commission’s competence in the light of the expiry of the lex specialis, does not specify what ‘the provisions which authorise the Commission to impose sanctions’ are. It refers only to the applicable substantive law and procedural rules and does not at all address the question of the Commission’s competence to ‘impose sanctions’.
89. Recital 350 of the contested decision does not therefore explain what ‘the provisions which authorise the Commission to impose sanctions’ are. Read in isolation, the first sentence of recital 350 could be referring to Article 15(2) of Regulation No 17 or to Article 65(5) CS.
90. Nevertheless, when recital 350 of the contested decision is read together with Section 8 of the contested decision, which concerns the imposition of the fine and which is entitled ‘Applicability of Article 65(5) CS’, it becomes clear that the Commission based its competence to impose fines in this case on Article 65(5) CS. Thus, recital 515 points out that ‘[i]n accordance with Article 65(5) CS, the Commission may impose fines on any undertaking [concerned]’.
91. It is moreover also quite clear from recitals 515 to 518 that the contested decision is based exclusively on Article 65(4) and (5) CS. Paragraph 4 is indeed quoted in recital 516 in order to explain that the Commission is competent to find that an infringement was committed by Federacciai, an association of undertakings, but that it does not have competence, under Article 65(5) CS, to impose a fine on it. Article 65(5) CS only confers competence on the Commission to impose fines on undertakings and not on associations of undertakings. If, as claimed by the Commission, the contested decision was based on Regulation No 17, such a legal analysis would be irrelevant. Article 15(2) of Regulation No 17 makes no distinction between undertakings and associations of undertakings with regard to the competence of the Commission to impose fines.
92. Equally, Section 7 of the contested decision, entitled ‘Inapplicability of Article 65(2) CS’, contains another indication that the Commission based its contested decision on Article 65 CS, and not on the provisions of Regulation No 17. Thus, in recital 514 of the contested decision, the Commission examined whether it could authorise the agreement covered by the contested decision, pursuant to Article 65(2) CS. The Commission, however, made no reference whatsoever to Article 9(1) of Regulation No 17 which confers the competence to grant exemptions, but based its competence on Article 65(2) CS alone.
93. Fifthly, with regard to reading the contested decision in the light of the second statement of objections of 12 August 2002, it must be pointed out that the Commission states therein that it opened new proceedings on the basis of Regulation No 17 and refers furthermore explicitly to Article 3 of that regulation (supplementary statement of objections, paragraph 2).
94. That factor is not, however, sufficient of itself to justify a finding that the legal basis of the contested decision is constituted by Article 3 and Article 15(2) of Regulation No 17. On the contrary, the omission of any reference to Article 3 and Article 15(2) of Regulation No 17 in the preamble to the contested decision and the omission of any reference to those provisions in the grounds of that decision must be regarded as reflecting a deliberate choice made by the Commission. It is not possible to accept, in the circumstances of this case, that the Commission, having launched a discussion with the applicants on the disputed reference to Regulation No 17 as legal basis by means of a supplementary statement of objections, simply forgot to mention that legal basis in the contested decision.
95. Sixthly, that reading of the contested decision is evidently corroborated by the fact that, in the cases in issue, four of the eight applicants, that is the applicants in Cases T‑27/03, T‑46/03, T‑58/03 and T‑80/03, clearly founded their applications on the premiss that the contested decision was based on Article 65(4) and (5) CS. Only three applicants, that is the applicants in Cases T‑97/03 and T‑98/03, founded their arguments on the view that the contested decision was based on Regulation No 17 while considering that it did not confer any competence on the Commission in that regard. Finally, the applicant in Case T‑79/03 remains vague about the legal basis and examines two possibilities, one the theory that the contested decision is based on Article 65(4) and (5) CS and the other that it is based on Regulation No 17, concluding that the Commission lacked competence in any case.
96. It must be pointed out in that regard that, in its defence in the cases in which the applicants had considered in their application that the contested decision was based on Article 65(4) and (5) CS, the Commission never stated that the applicants’ arguments rested on a false premiss. No defence or rejoinder lodged in the present cases contains an explicit reference to Article 3 or to Article 15(2) of Regulation No 17 as the legal basis of the contested decision. The only references to Article 15(2) of Regulation No 17 in the written pleadings of the Commission concern the discussion of the lex mitior
in order to justify, in the present case, the application of Article 65(5) CS, and not that of Article 15(2) of Regulation No 17.
97. The applicant in Case T‑27/03, after having taken note of the defence, states, in paragraph 5 of its reply, as follows:
‘The Commission seems therefore once and for all to concede: (i) that the contested decision was adopted on the legal basis of Article 65 CS alone; (ii) that the fines were imposed pursuant to that provision alone. All the remainder, all the other arguments developed by the Commission concerning the indivisibility of the Community legal order and the criteria governing the succession of laws, are revealed to be academic considerations, of a general and irrelevant nature, and not worthy of consideration by the Court.’
98. Moreover, in Case T‑79/03, in which the applicant remains vague about the legal basis of the contested decision, the Commission completely failed to clarify the discussion on that point.
99. Thus, in paragraph 58 of its defence in Case T‑79/03, the Commission states: ‘The point of departure of the reasoning of the applicant is not correct: according to it, the Commission should have used the procedural rules of Regulation No 17 to impose a fine for the purposes of Article 65 CS. … It must … be noted that the fine was not imposed on the basis of Regulation No 17, but, as the decision clearly states, pursuant to Article 65(5) CS.’ In the footnote it adds that, ‘contrary to the applicant’s assertion, it follows clearly from Section 5 of the decision (recitals 335 and [following]) that the Commission is applying Regulation No 17’. In its reply, the applicant in Case T‑79/03 indignantly states in paragraph 33:
‘... the Commission contradicts itself once again and, this time, in the space of a few lines, which shows how difficult it is to maintain a thesis which is legally inconsistent. It states namely – in paragraph 58 of its defence – … at the end of the paragraph that the fine was not imposed on the basis of Regulation No 17, only then to add, in the form of a note, that it follows clearly from the contested decision that it did apply Regulation No 17.’
100. It was not therefore until the hearing and then only in response to the questions posed by the Court that the Commission for the first time stated clearly that, in its view, the contested decision was also based on Article 3 and Article 15(2) of Regulation No 17.
101. In those circumstances, having regard to all of the foregoing considerations and of the various explicit references in the contested decision to the legal basis constituted by Article 65(4) and (5) CS (preamble to the contested decision and recitals 515 to 518 of that decision) and to the complete absence of any reference to Article 3 and Article 15(2) of Regulation No 17 as the legal basis, it must be held that the contested decision was based on Article 65(4) and (5) CS alone.
The competence of the Commission to establish and sanction an infringement of Article 65(1) CS after the expiry of the ECSC Treaty
– The relationship between the ECSC and EC Treaties
102. It should be recalled that the material scope of the ECSC Treaty was limited. The ECSC Treaty was in fact concerned with only two products, coal and steel, as defined in Article 81 CS and in Annex I to the ECSC Treaty. Given that the EEC Treaty (which became the EC Treaty) is drafted in general terms applying to all sectors of the economy and therefore in principle also to products coming under the ECSC Treaty (see, to that effect, Opinion 1/94, cited in paragraph 57 above, paragraph 27), the authors of the EC Treaty included a provision with the intention of avoiding the primacy of the EC Treaty provisions over ECSC Treaty provisions.
103. Article 305(1) EC states:
‘The provisions of [the EC] Treaty shall not affect the provisions of the [ECSC] Treaty, in particular as regards the rights and obligations of Member States, the powers of the institutions of [the ECSC] and the rules laid down by that Treaty for the functioning of the common market in coal and steel.’
104. It follows that the rules of the ECSC Treaty and all the provisions adopted in implementation of that treaty remained in force as regards the functioning of the common market, notwithstanding the supervening EC Treaty ( Gerlach, cited in paragraph 57 above, paragraph 9, and Joined Cases C-74/00 P and C-75/00 P Falck and Acciaierie di Bolzano
v Commission
[2002] ECR I-7869, paragraph 100).
105. In so far, however, as matters were not the subject of provisions in the ECSC Treaty or rules adopted under it, the EC Treaty and the provisions adopted for its implementation could, even before the expiry of the ECSC Treaty, apply to products covered by the ECSC Treaty (Case 328/85 Deutsche Babcock
[1987] ECR 5119, paragraph 10; Falck and Acciaierie di Bolzano
v Commission, cited in paragraph 104 above, paragraph 100; Opinion 1/94, cited in paragraph 57 above, paragraph 27).
106. Moreover, the ECSC Treaty expired on 23 July 2002, in accordance with Article 97 CS. Since the EC Treaty is of general scope, the sectors which previously came under the ECSC Treaty came, as from 24 July 2002, within the scope of application of the EC Treaty.
– Whether Article 65(4) and (5) CS conferred competence on the Commission to adopt the contested decision
107. The contested decision was adopted, on 17 December 2002, on the basis of Article 65(4) CS, with regard to the finding of an infringement under Article 65(1) CS, and on the basis of Article 65(5) CS, with regard to the imposition of fines on the undertakings having allegedly participated in the infringement of Article 65(1) CS.
108. With regard to the competence of the Commission to adopt the contested decision on the basis of Article 65(4) and (5) CS, after the expiry of the ECSC Treaty, the Commission explains, in recital 348 of the contested decision, that ‘the EC Treaty and the ECSC Treaty belong to the same legal order, l’ordre juridique communautaire, and that in the framework of this new order the ECSC Treaty was to be considered lex specialis
until 23 [July] 2002’. It refers, in recital 349 of the contested decision, to Article 305(1) EC and to the single institutional framework (Merger Treaty and Article 3 EU). In order to emphasise the indivisibility of the Community legal order, the Commission draws attention, in its written pleadings, to the fact that the Community judicature has interpreted the provisions of the ECSC and EAEC Treaties with reference to the provisions of the EC Treaty on the basis of the common principles to which all the Community treaties adhere ( Busseni, cited in paragraph 55 above, paragraphs 16 and 21).
109. On the expiry of the ECSC Treaty, the transition between the ECSC Treaty competition regime and the EC Treaty competition regime occurred automatically on the basis of the principle of succession of legal rules within the same legal order ( Salumi and Others, cited in paragraph 60 above, paragraph 9; CT Control (Rotterdam) and JCT Benelux
v Commission, cited in paragraph 60 above, paragraph 22; and De Haan, cited in paragraph 60 above, paragraph 13). In recital 331 of the contested decision, which contains a reference to paragraph 31 of the Communication of 18 June 2002, the Commission explains that ‘the substantive law applicable’ is ‘the law in force at the time when the facts constituting the infringement occurred’ and ‘as regards procedure, the law applicable after the expiry of the ECSC Treaty [is] EC law’. In recital 350 of the contested decision, the Commission adds that ‘it appears to be justified to apply the substantive law in force at the time of the infringement’ and it states, in recital 352 of the contested decision, that ‘the applicable procedural laws are the one[s] in force at the moment of the adoption of the measure in question’.
110. It must therefore be examined whether the abovementioned factors permit the conclusion that Article 65(4) and (5) CS conferred competence on the Commission to adopt the contested decision at the time when it was adopted.
111. In that regard, it must be recalled that, by virtue of Article 305(1) EC, the ECSC Treaty constituted a lex specialis
derogating from the lex generalis of the EC Treaty (Opinion of Advocate General Van Gerven in Banks, cited in paragraph 57 above, point 8; ESF Elbe-Stahlwerke Feralpi
v Commission, cited in paragraph 57 above, paragraph 102; and Verband der freien Rohrwerke and Others
v Commission, cited in paragraph 57 above, paragraph 68).
112. The fact that the ECSC Treaty constituted a lex specialis
meant that, on expiry of that treaty, the lex generalis
became automatically applicable. Thus, in recital 348 of the contested decision, the Commission found, correctly, that, ‘starting from 24 [July] 2002 all the sectors that previously belonged to the application area of the ECSC Treaty, of its procedural laws and of its remaining secondary legislation are now submitted to the provisions of the EC Treaty’. In the competition sector, that finding implies that the conduct of undertakings and associations of undertakings previously coming under the ECSC Treaty is capable of coming under the scope of application of Articles 81 EC and 82 EC as from 24 July 2002.
113. Nevertheless, the present plea does not in any respect concern the application of Article 81 EC to a cartel in the steel sector after expiry of the ECSC Treaty. It concerns the competence of the Commission to find and sanction an infringement of Article 65(1) CS on the basis of Article 65(4) and (5) CS.
114. The nature of the lex specialis
of the ECSC Treaty in relation to the EC Treaty does not lend any support to the Commission’s contention that it retains competence to base a decision on the lex specialis
after that treaty expired. It must be pointed out in that regard that Article 305(1) EC, from which the Community judicature inferred the lex specialis
character of the ECSC Treaty in relation to the EC Treaty, purely and simply confirms the expiry of the ECSC Treaty on 23 July 2002 to the extent that it provides that the EC Treaty provisions do not affect those of the ECSC Treaty, and that Article 97 CS provides explicitly for the expiry of the ECSC Treaty at that date.
115. Similarly, the indivisibility of the Community legal order to which the Commission refers in recital 349 of the contested decision and which it derives from the single institutional framework and from the need to ensure coherence in the interpretation of the provisions contained in the various Community treaties is not such as to confer on the Commission a competence to find that Article 65(1) CS has been infringed and to impose a fine on the undertakings concerned on the basis of Article 65(4) and (5) CS following expiry of the ECSC Treaty. It must be pointed out in that regard that, notwithstanding the single institutional framework resulting from the Merger Treaty, the merger of the Communities was never accomplished. Furthermore, the coherent interpretation of the substantive law provisions of the various treaties has no effect on the competences conferred on the various institutions by those treaties. Within each treaty framework, the institutions are competent to exercise only those powers which that treaty conferred upon them (see, to that effect, Case C‑176/03 Commission
v Council [2005] ECR I‑7879, paragraphs 38 to 53).
116. With regard to the argument deriving from the succession of laws, it follows from the case-law that substantive rules of Community law must be interpreted, in order to ensure observance of the principles of legal certainty and of legitimate expectations, as not applying, in principle, to situations existing before their entry into force, whereas procedural rules are of direct application ( Salumi and Others, cited in paragraph 60 above, paragraph 9; CT Control (Rotterdam) and JCT Benelux
v Commission, cited in paragraph 60 above, paragraph 22; De Haan, cited in paragraph 60 above, paragraph 13; Case T-42/96 Eyckeler & Malt
v Commission
[1998] ECR II‑401, paragraph 55; and Case T-180/01 Euroagri v Commission [2004] ECR II-369, paragraph 36).
117. It should nevertheless be pointed out that the question of the competence of an institution precedes the question of the applicable substantive and procedural rules. After having first determined that an institution is competent to adopt a measure on the basis of a specific provision of the Treaty or of secondary law, the second step is to determine the applicable substantive and procedural rules, in conformity with the principles governing the succession of legal rules.
118. It should be noted in that regard that the provision constituting the legal basis of a measure and empowering the Community institution to adopt the measure in question must be in force at the moment of its adoption (Case C‑269/97 Commission
v Council
[2000] ECR I‑2257, paragraph 45; see also, to that effect, Case T-310/00 MCI
v Commission [2004] ECR II‑3253, paragraphs 78 to 114). By contrast, the principles governing the succession of legal rules may lead to the application of substantive provisions which are no longer in force at the time of the adoption of a measure by a Community institution.
119. By referring in recitals 331 and 350 to 352 of the contested decision to the principles governing the succession of legal rules in order to establish its competence to adopt the contested decision, the Commission confused the provision of substantive law addressed to the undertakings, that is Article 65(1) CS, with the legal basis for Commission action, that is Article 65(4) and (5) CS. It inferred automatically from the applicable provision of substantive law that it has competence to adopt a decision on the basis of a provision which had in the meantime expired. Thus at the hearing, on the matter of its competence, concerning the applicable substantive and procedural law, the Commission again stated that ‘the first two … are practically the same’ or again that ‘the conferral of competences is closely linked to the substantive law [applicable]’.
120. Since, however, it follows from the case-law cited in paragraph 118 above that the provision constituting the legal basis of a measure must be in force at the time of its adoption, and that, in accordance with Article 97 CS, Article 65(4) and (5) CS had expired on 23 July 2002, the Commission could no longer derive competence from those expired provisions in order to establish an infringement of Article 65(1) CS and to impose fines on the undertakings which had allegedly participated in the infringement.
121. Finally, with regard to the Commission’s argument that the Court of Justice itself had continued to apply Article 65 CS, after its expiry, it must be pointed out that in the judgments cited by the Commission (paragraph 62 above), the Court reviewed the legality of measures which the Commission had adopted on the basis of the ECSC Treaty at a time when that treaty was still in force. Those judgments do not therefore assist the Commission’s argument that it still had competence to adopt a decision on the basis of a provision of the ECSC Treaty after it had expired.
122. It follows from all of the foregoing that the first part of the first plea must be upheld and that the contested decision is unlawful. The unlawfulness attaching to the contested decision is not, however, of such obvious gravity that the contested decision must be found to be legally non-existent, as sought by the forms of order in Cases T‑27/03 and T‑80/03 (see, to that effect, Case C-137/92 P Commission
v BASF and Others
[1994] ECR I‑2555, paragraph 52).
123. Consequently, the contested decision must be annulled as regards the applicants.
Costs
124. Under Article 87(2) of the Rules of Procedure, 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 defendant has been unsuccessful, it must be ordered to pay the costs, including those relating to the interlocutory proceedings in Cases T‑46/03 and T‑79/03, in accordance with the forms of order sought by the applicants.
125. In accordance with the first subparagraph of Article 87(4) of the Rules of Procedure, the Member States which intervened in the proceedings are to bear their own costs. The Italian Republic will therefore bear its own costs.
Operative part
On those grounds,
THE COURT OF FIRST INSTANCE (Fifth Chamber, Extended Composition)
hereby:
1. Annuls Commission Decision C (2002) 5087 final of 17 December 2002 relating to a proceeding under Article 65 CS (Case COMP/37.956 – Reinforcing bars) with regard to SP SpA, Leali SpA, Acciaierie e Ferriere Leali Luigi SpA, Industrie Riunite Odolesi SpA (IRO), Lucchini SpA, Ferriera Valsabbia SpA, Valsabbia Investimenti SpA and Alfa Acciai SpA;
2. Orders the Commission to bear its own costs, and to pay those incurred by SP, Leali, Acciaierie e Ferriere Leali Luigi, IRO, Lucchini, Ferriera Valsabbia, Valsabbia Investimenti and Alfa Acciai, including those relating to the interlocutory proceedings in Cases T-46/03 and T-79/03;
3. Orders the Italian Republic to bear its own costs.