61971C0008
OPINION OF MR ADVOCATE-GENERAL ROEMER
DELIVERED ON 1 JULY 1971 (
1
)
Mr President,
Members of the Court,
On 13 November 1970, in connexion with proceedings initiated on 5 June 1970 on the ground of an infringement of Articles 85 and 86 of the EEC Treaty against the Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte (hereinafter referred to as ‘GEMA’), a registered association having its office in Berlin, following receipt of a notice of objections in accordance with Article 19(1) of Regulation No 17/62 on restrictive practices, the Deutscher Komponistenverband (hereinafter referred to as ‘the Association’), a registered association having legal personality, of which most German composers are members and whose object is the protection and promotion of their common professional interests, sent by Telex to the Director for Agreements and Dominant Positions in the Directorate-General for Competition in the Commission from its President, who alone is entitled to represent the Association, a request pursuant to the combined provisions of Article 19(2) of Regulation No 17/62 (OJ, English Special Edition, 1959-1962, p. 87) and Article 5 of Regulation No 99/63 (OJ, English Special Edition, 1963-1964, p. 47) to be heard in the various proceedings initiated by the Commission against GEMA. It was stated in the telex message that the composers participated in the founding of GEMA and consequently had an interest in knowing what financial advantages they might expect from the proceedings initiated by the Commission. In particular, information was requested as to the effect of the proceedings on the social security arrangements of GEMA, on the cultural and artistic encouragement of contemporary composers of serious music and the role of bodies exploiting such compositions which, when drawing up their scale of charges, must make suitable allowance for the religious, cultural and social interests of persons paying royalties, as well as the interests of youth welfare.
The Director of the Directorate for Agreements and Dominant Positions replied to this request by a letter of 17 November 1970. He indicated that the question whether the Association had a sufficient interest within the meaning of Article 19(2) of Regulation No 17 could remain open. He pointed out that the President of the Association was also Chairman of the supervisory board of GEMA and as such had been informed and had been in a position to influence the attitude to be taken by the latter. Nevertheless, the letter continued, ‘I hereby grant you a period of one month in Which to submit written observations on the said particular points. The Commission will consider these observations irrespective of the question whether the Deutscher Komponisten-Verband complies with the requirements of Article 19(2) of Regulation No 17’. The letter concluded with the following assurance ‘Thus, irrespective of any written observations which may be submitted by the Deutscher Komponisten-Verband the appropriate department is willing to hold a discussion with you in Brussels if you so desire. If you are interested in such a meeting may I ask you to suggest a date in the week of 7 to 11 December 1970?’ With regard to the specific points raised in the telex message of the Association it was further stated that the social security arrangements of GEMA were not called in question and that the aim of the proceedings was rather, by criticizing certain inadequacies, to strengthen the rights of composers. The encouragement of contemporary composers of serious music would not be affected, and indeed an endeavour would be made to improve the existing situation. Finally, the Commission would not dispute the scale of charges of GEMA, that is, the requirement that accounts be taken of religious, cultural and social interests and of youth welfare would not be called in question.
Nevertheless, the Association did not avail itself of the opportunity offered to it of submitting its observations. Instead it expressed itself thus in a letter of 12 December 1970 to the Director of the Directorate for Agreements and Dominant Positions: ‘Neither with regard to procedure nor to content does your reply provide the requisite basis for the assertion by the Deutscher Komponisten-Verband of its interests in the proceedings pending before the Commission’. The letter then maintains that the interests of the Association are not identical with those of GEMA, within the framework of which the Association represents only one of several groups. So far the Commission had not recognized the particular interests of composers, whose income could only be ensured with the assistance of GEMA. Finally, it was emphasized that observations could not be submitted upon so indefinite a procedural basis, and accordingly the Association made an express claim for ‘a decision of the Commission in accordance with the second sentence of Article 19(2) of Regulation No 17’ authorizing it to be heard.
The Director of the Directorate for Agreements and Dominant Positions replied to this with a letter of 17 December 1970 in which he emphasized that the President of the Association, as Chairman of the Supervisory Board of GEMA, had long been aware (as from 5 June 1970 and 22 July 1970) of the objections made to it and could have applied much earlier for a hearing. However, he specifically added: ‘I hereby extend the period for submitting observations contained in my letter of 17 November 1970 until 18 January 1971’. With regard to a decision of the Commission as to allowing the Association to participate in the procedure, it was stated that it had in this respect ‘no legally protected interest after the opportunity of submitting observations has been granted’.
As we have heard in the oral procedure, at the request of the representative of the Association conveyed in a telex message of 13 January 1971 the period fixed was again extended, this time until 1 February 1971, by letter of the Commission of 16 January 1971. Nevertheless, this period also elapsed without the Association's submitting any observations on the substance. Shortly before the expiry of the period, the lawyer appointed by the Association merely stated in a letter of 30 January 1971 that the Association was not satisfied with the opportunity of submitting observations other than in due form. The Association had a right to be heard and, in view of a series of specific points which were described, its interest rendered that right mandatory. Accordingly, he repeated the Association's application to be heard in the proceedings initiated against GEMA, in accordance with the second sentence of Article 19(2) of Regulation No 17. If a formal decision was not forthcoming it was indicated that the Association would avail itself of any judicial remedy open to it.
As a result of this on 12 March 1971 proceedings were initiated before the Court on the basis of Article 175 of the EEC Treaty. In its application the Association requested that the Commission should be ordered to grant it, within the framework of Proceedings IV/26.760 (GEMA), a formal right to be heard in accordance with the second sentence of Article 19(2) of Regulation No 7.
The Commission reacted to this by making a formal application in accordance with Article 91 of the Rules of Procedure, that is it requested a prior ruling on the admissibility of the application and claimed that it should be dismissed as inadmissible.
In accordance with the Commission s request the admissibility of the application was the sole problem considered in the oral procedure of 17 June 1971. Accordingly, I have also restricted myself in the following examination to considering whether the application of the Association meets the requirements of Article 175 of the EEC Treaty.
1.
The Commission contests this, arguing primarily that the objective of the application is to obtain an order granting it the right to be heard, that is, to compel the Commission to perform an act. Such claims are not possible under Article 175, since only an action whose objective is to obtain a declaration of the Court is admissible.
This assertion is indeed correct in that Article 175 of the EEC Treaty is concerned with an action to obtain a declaration. The clear wording of this article will not admit of any other interpretation, as is the case with Article 176, which speaks of a failure to act which ‘has been declared contrary to this Treaty’. Nevertheless it does not necessarily follow from these facts that the application is inadmissible. That is, from its content as a whole it is clear that the essence of the applicant's complaint is the failure to act, the fact that its request was not granted. This is the sense in which the description of the subject-matter of the dispute must be understood (‘the Commission's culpable failure to act’); in this connexion reference may be made to page 4 of the application: ‘In this application a declaration is requested to the effect that the Commission is obliged to grant a formal hearing to the applicant, the Association, within tht framework of a hearing in accordance with the second sentence of Article 19(2) of Regulation No 17’. In view of this, it is in my opinion possible to proceed here as in a series of other cases in which applications have been given a logical interpretation and construction. In this connexion I refer by way of example to the decisions of the Court in Joined Cases 27 and 39/59 (Rec. 1960, p. 795) and Joined Cases 25 and 26/65 ([1967] ECR 33). The view should thus be taken in the present case that the object of the application is simply to obtain a ruling as to the infringement of Article 19 of Regulation No 17, thereby avoiding the seemingly formalistic solution of dismissing the application on the ground that its working is inadmissible. This view gains weight from the fact that, in the event of the action's being well-founded, a ruling to the effect that the Commission has infringed the Treaty would mean that the measures to be taken by the Commission in accordance with Article 176 could thus be unequivocally discerned in the judgment; the result attained in practice would therefore be equivalent to a direct order to the Commission to perform a specific action.
2.
Since no decisive objection as to admissibility can be derived from the wording of the application, it must further be considered whether the remaining conditions of Article 175 have been fulfilled. As the Court is aware, that provision states in its third paragraph that there must have been a failure ‘to address [an] act’ to the applicant. With reference to the present case, which relates to the grant of the right to a hearing and therefore concerns a procedural measure, the present question of admissibility turns on whether proceedings of such a nature may be classified as an act. If an ‘act’ is solely to be understood as a decision within the meaning of Article 189 of the EEC Treaty, that is to say, a statement which has until now been defined essentially by reference to the concept of an ‘administrative measure’, it in fact appears extremely doubtful whether an affirmative answer can be given to the question raised.
There are, however, good grounds for considering that an ‘act’ within the meaning of Article 175 is not identical to a ‘decision’. If that had been the intention it could have been expressly stated in so many words. Recommendations and opinions are directly and specifically excluded from the third paragraph of Article 175 and it is also clear from the system of legal protection available to private applicants under the Treaty that regulations and directives are likewise excluded. Thus, of the measures listed in Article 189 only decisions remain. However, since Article 175 is not worded thus, it may in fact be considered that the concept of an ‘act’ has a wider meaning. This has been emphasized by well-known writers (
2
) with precise reference to specific aspects of the procedure in respect of restrictive practices, for example the act initiating proceedings, and in my opinion too it is evident. The concept would therefore cover any measure producing certain legal effects binding the institution in a certain way, perhaps even including, as many consider, ‘reine Realakte’. Considered in this light there is nothing to preclude regarding as acts certain procedural measures, such as the grant of the right to be heard in cartel proceedings following an application to that effect, since it places those concerned in a certain legal position in the proceedings and has legal effects (for example, the fact that in subsequent legal proceedings matters may not be relied upon if they could have been raised at the hearing and might possibly have influenced the decision of the Commission).
I therefore consider that the application should not be called in questoin on the ground that the hearing requested does not constitute an act within the meaning of Article 175 of the EEC Treaty. I must, however, state expressly that I have refrained from profounder investigation of this important and difficult question since in the present case other considerations appear more significant.
3.
The Commission considers that this is plainly true with regard to the requirement that before an action is commenced the Commission must be called upon to act. It explains that according to the correct criteria this was lacking in the present case, and on this ground alone the action which has been initiated must be dismissed.
In tact Article 175 or the EEC Treaty requires that before legal proceedings are initiated in respect of a failure to act on the part of the Commission the latter must be informed of the object of the action expected of it. As is clear from previous case-law (cf. for example Case 17/57, Rec. 1958-1959, p. 27, and Joined Cases 22 and 23/60, Rec. 1961, p. 374) in this respect the Commission must be clearly informed of the measures to be undertaken by it and it must be made plain that if the Commission omits to act legal proceedings will be initiated. Further, it certainly cannot be accepted that every application addressed to the Commission can invariably be regarded as calling upon it to act within the meaning of Article 175; to this extent I agree with the Commission.
Nevertheless, if the present case is considered in relation to these principles it is difficult to say, on the basis of any reasonable criteria, that the applicant Association has not expressed itself with the necessary clarity in the administrative procedure. If the telex message of 13 November 1970 is perhaps insufficient, although in my opinion it is clearly expressed, the repetition in the letter of the Association of 2 December 1970 so emphasizes the request made that it must be held that at least from that time the Commission was properly put on notice to act, although no express notification had been made that legal proceedings would be instituted. At all events this holds good for the letter of 30 January 1971 in which, as I have already said, it was in fact expressly stated that recourse would be had to legal proceedings. This is significant for the present proceedings even if the application lodged on 12 March 1971 might be considered premature if the relevant period is calculated from 30 January 1971, and although the letter of 30 January 1971 was first produced only in connexion with the plaintiff's observations on the objection of admissibility. It is in fact conclusive that production was made before the expiry of the period for bringing an action (if the relevant period is reckoned from 30 January 1971, which on this view is the only reasonable solution) and it is also noteworthy that in a factual situation of this nature national law likewise considers inappropriate the seemingly formalistic dismissal of the action (with the resultant repetition of the legal proceedings) and prefers simply to postpone the question of compliance with the requirements for admissibility.
I am consequently unable to agree with the Commission on the point which has just been discussed and cannot propose dismissal of the application on the ground of failure to make a prior request to the Commission.
4.
However, another matter gives rise to doubts as to admissibility. It follows from Article 175 of the Treaty that the right of action may be precluded by the behaviour of the institution before whom the matter has been brought after it had been called upon to act. This aspect must now be considered, without its being necessary to come to a final decision as to whether in the present case, as the Commission has suggested, a position was defined within the meaning of Article 175.
The behaviour of the Commission in the present case was characterized by the fact that the Association was in fact granted a hearing in accordance with its request of 13 November 1970. This is clear from the Commission's reply, in which it set a time-limit of one month for the submission of written observations and stated that it was prepared to discuss the matter orally. The original period was subsequently extended on two occasions, so that altogether the Association had more than two months in which to make known its point of view. Thus in my view the applicant's request was thereby granted; it has had ample opportunity to defend its interests and, in particular, was assured that its observations would be included in the Commission's deliberations, that is, that they would be employed in the proceedings against GEMA. This view may be entertained although the reply was only issued by the Director of the Directorate for Agreements and Dominant Positions, since in any event it is provided in accordance with Article 9 of Regulation No 99 that hearings in cartel proceedings of the Community ‘shall be conducted by the persons appointed by the Commission for that purpose’. There is furthermore no indication that the assurances contained in the letter of 17 November would not have been honoured and that the Association's observations would thus have been ignored. However, the most important factor of all is that the provisions of the above-mentioned Regulation No 99 on hearings were complied with. Article 5 thereof states in particular: ‘If natural or legal persons … apply to be heard pursuant to Article 19(2) of Regulation No 17, the Commission shall afford them the opportunity of making known their views in writing within such time-limit as it shall fix’. In accordance with Article 11 of Regulation No 99, in fixing the time-limit the Commission shall have regard ‘to the time required for the preparation of comments and to the urgency of the case’. It is merely provided that the time-limit shall be not less than two weeks. In addition, Article 7 of Regulation No 99 provides that ‘The Commission shall afford to persons who have so requested in their written comments the opportunity to put forward their arguments orally, if those persons show a sufficient interest …’. The Commission has certainly not failed to observe the substance of those provisions in its reply. I do not however consider that the applicant has in addition a claim to further measures, in particular that its right to be heard should be confirmed by the Commission itself in a formal decision. It would undoubtedly have no effect on the procedure with regard to the hearing as such if it were stated that instead of constituting a mere informal hearing in pursuance of the first sentence of Article 19(2) of Regulation No 17 it was a formal hearing, since the procedure is completed when the Commission receives the observations. In particular, Community law does not recognize formal participation in administrative proceedings, which would confer the enhanced status of ‘party’ to the proceedings, as is provided in Article 51 of the Gesetz gegen Wettbewerbsbeschrankungen (Law against restrictions on competition). Thus, when the plaintiff in this connexion indicates that a formal decision on the hearing by the Commission would probably have enabled it to raise matters in the proceedings, it must be stated that no provision of this nature is contained in the procedural rules of Community competition law. In addition, it must be recognized that, even without a formal decision on the hearing, the applicant could have availed itself of the opportunity of influencing the proceedings by means of suggestions. If the applicant had encountered difficulties in this connexion, it would still have had the opportunity of furthering the defence of its interests on this ground (particularly as the question of its entitlement to a hearing has remained open). It is, however, certain that at the time of admission to the hearing there exists no immediate interest in the resolution of questions of the type which might be put in the course of the proceedings. Finally, with regard to the effect on the possibility of bringing subsequent proceedings under Article 173 of the EEC Treaty against the decision concluding the cartel proceedings, I likewise do not understand what significance a formal decision on admission to the hearing could have. It is clear that these two proceedings are governed by different criteria: with regard to the hearing it is sufficient to establish an interest, whereas with regard to bringing an action it is necessary that the contested decision should be of direct and individual concern to the applicant. In addition, it must also be observed that the attitude of the Commission has in no way prejudiced the solution to the problem of the right to bring an action, which was not relevant at the time, precisely because in its communication of November 1970 the question whether the Association had a right to be heard was left open.
It may therefore be said that it is the lack of a legally protected interest which ultimately lead to the rejection of the application for a ruling. It must again be repeated that the decisive factor is that the reaction of the Director of the Directorate for Agreements and Dominant Positions, who was in charge of the proceedings, took sufficient account of the applicant's interest in participating in those proceedings. If the Association did not make use of the opportunity offered it must now be considered that its injury arose from its own conduct. Furthermore, there are no grounds for its application for a theoretical ruling as to whether it had a right to be heard.
5.
Accordingly, my opinion is as follows:
The present application must be dismissed as inadmissible, in accordance with the conclusions of the Commission. The applicant must therefore bear the costs of the proceedings.
(
1
)	Translated from the German.
(
2
)	Cf. particularly Steindorff in ‘Außenwirochaftsdienst del Betriebsrates’ 1963, p. 353.