II —

(1) The Belgian Government challenges the admissibility of the Commission's action on the grounds that inadequate reasons are given for it and that the periods laid down in the directive and the reasoned opinion which was sent to it were obviously insufficient. Although those objections involve considerations of the substance, the admissibility of the Commission's actions raises a real problem. Certain Member States (Denmark, Ireland, Luxembourg, the Netherlands, the United Kingdom and Greece) have decided pursuant to Article 2 (5.) and-(6) of the directive to postpone its application with regard to certain groups or types of credit institutions, the list of which was published in the Official Journal of the European Communities by the Commission. ( 4 ) Moreover, even if certain States have prima facie complied with Article 14 (1) of the directive the measures which they have taken are perhaps not, as regards substance, completely compatible with the principles of the directive since the Commission informed us at the hearing that on 30 September 1982 it had sought explanations from some of them. The question may therefore be asked whether there is a real difference between the two situations where both involve the postponed application of the directive, in the one case because no national implementing measures have been adopted and in the other case because the national measures adopted in due time do not substantially comply with the directive. In those cicumstances it may perhaps have been more expedient for the Commission to propose to the Council that the date should be postponed, as it did for example in the case of valueadded tax. In this field it is highly desirable that Community law should be applied simultaneously in all Member States. However, in view of the previous decisions of the Court, I shall disregard those objections. As regards time-limits, it was held in the judgment of 26 February 1976 in Case 52/75 (Commission v Italy [1976] ECR277): “The correct application of a directive is particularly important since the implementing measures are left to the discretion of the Member States and would be ineffective if the desired aims are not achieved within the prescribed time-limits. Although the provisions of a directive are no less binding on the Member States to which they are addressed than the provisions of any other rule of Community law, such an effect attaches a fortiori to the provisions relating to the periods allowed for implementing the measures prescribed, in particular since the existence of differences in the rules applied in the Member States after these periods have expired might result in discrimination”. ( 5 ) It must be further pointed out that no bill had yet been put before either the Belgian or the Italian Parliament when the period for implementing the directive expired. As regards the objection based on the absence of reciprocity, it was held in the same judgment: “Furthermore, any delays there may have been on the part of other Member States in performing obligations imposed by a directive may not be invoked by a Member State in order to justify its own, even temporary, failure to perform its obligations. The Treaty did not merely create reciprocal obligations between the various subjects to whom it applies, but established a new legal order which governs the powers, rights and duties of the said subjects, as well as the procedures necessary for the purposes of havling any infringement declared and punished”. ( 6 ) “If the period allowed for the implementation of a directive proves to be too short the only means of action compatible with Community law available to the Member State concerned consists in taking the appropriate initiatives within the Community in order to obtain the necessary extension of the period by the competent Community institution”. ( 7 ) (2) Whilst not disputing that the directive was not formally incorporated into their legal systems by means of legislation within the period originally laid down, or even within the period specified in the reasoned opinions, the Belgian and Italian Governments plead: — The size of the task which the enactment of such legislation represents; — The fact that they are using the opportunity to amend their legislation in the field in question; — The fact that in practice the rules contained in the directive are already applied, even if not as the result of a statute ordinary national law provides all the necessary guarantees; in addition “internal instructions” ensure that the directive is incorporated into national law; — In view of the fact that the majority of the provisions of the directive are “directly applicable” and do not require any translation into national law, the omission complained of is of a purely formal nature; and — Finally, their firm intention to endeavour to incorporate the directive into their national law as soon as possible. Apart from the fact of their somewhat contradictory nature, those argument call for the following answers : (a) It is obvious that the incorporation into national law of a directive of this kind raises problems of a different scale from the application of directives concerned with technical harmonization, for example in connection with motor vehicles or agricultural tractors. However, acccount was taken of the complexity of the subject when the period was fixed in the directive; the directive itself envisages the possibility of deferred application in certain cases. ( 8 ) The Court held on 12 October 1982 in Commission v Italy: “Attention should also be drawn to the fact that the governments of the Member States participate in the preparatory work for directives and must therefore be in a position to prepare, within the period prescribed, the draft legislative provisions necessary for their implementation. It appears, however, from information produced in the course of the proceedings that no draft law had yet been placed before the Italian Parliament within the period prescribed for implementation of the directive”. (b) Improvement may always be made in legislation. The Belgian and Italian Governments refer to draft legislation going beyond the requirements of the directive, but it would have been preferable for them to confine themselves initially to adopting measures to comply with the directive, which is itself described as a “first directive”. Its wording thus calls for the adoption of supplementary measures, but does not mean that it is deprived of all effect. In that respect the Italian Government observed at the hearing that the dispute with the Commission ought rather to have been resolved by the Advisory Committee established within the Commission by Article 11 of the directive. That body had only an advisory capacity. When it deals with credit institutions ( 9 ) it “shall not concern itself with concrete problems”. ( 10 ) But in every instance it only gives opinions or makes suggestions; it merely assists the Commission. The latter therefore retains all the powers which it derives from the Treaty, in particular from Article 169. (c) The directive covers a sphere in which regulations and “internal instructions” are at least as important as legislative provisions. It is however apparent from the preamble to the directive and from the correspondence prior to action between the Commission and the governments in question that the adoption of legislative provisions was in any event necessary to “remove the most obstructive differences between the laws of the Member States”. It is another matter to know what the content of those provisions should be. The question of the degree of harmony between national law in its present state, or even after the enactment of the draft draft legislation now before the respective Parliaments, and the directive was raised only in the defences lodged by the Member States; it was pursued during the oral procedure, partly as a result of the particulars which the Court sought from the Belgian Government. I do not think it possible to reach a definitive decision on that issue. Moreover, it does not seem to me to be necessary. It has been claimed that the object of the directive is fully achieved as a result of an administrative practice. The Court has already dealt with that argument in the judgment of 6 May 1980 in Case 102/79 (Commission v Belgium [1980] ECR 1473): “... a Member State has not discharged the obligation imposed upon it by the third paragraph of Article 189 of the Treaty if, for the purpose of fulfilling the requirements under the directives in question, it simply relies on existing practices or even just the tolerance which is exercised by the administration”. ( 11 ) “... Mere administrative practices, which by their nature can be changed as and when the authorities please and which are not publicized widely enough, cannot... be regarded as a proper fulfilment of the obligation imposed by Article 189 on Member States to which the directives are adressée!”. ( 12 ) (d) The Court has already rejected the argument that the translation into national law of the terms of a directive is in no way indispensable to ensure the result to be achieved but, at most, desirable from the point of view of clarity and legal certainty. The justification based on the “direct applicability” of the provisions of the directive cannot be accepted. It was held in the same judgment of 6 May 1980: “The effect of the third paragraph of Article 189 is that Community directives must be implemented by appropriate implementing measures carried out by the Member State. Only in specific circumstances, in particular where a Member State has failed to take the implementing measures required or has adopted measures which do not conform to a directive, has , the Court of Justice recognized the right of persons affected thereby to rely in law on a directive as against a defaulting Member State (cf. on this subject, the judgment of 5 April 1979, Ratti, Case 148/78 ECR 1629). This minimum guarantee arising from the binding nature of the obligation imposed on the Member States by the effect of the directives under the third paragraph of Article 189 cannot justify a Member State's absolving itself from taking in due time implementing measures sufficient to meet the purpose of each directive”. ( 13 ) (e) The arguments based on national difficulties (parliamentary procedure, political crises and so forth) and the firm intention to adopt the necessary measures do not unfortunately constitute an excuse in strict law. A start at least must be made at implementation. The Court has respeatedly stated : “... a Member State cannot rely upon domestic difficulties or provisions of its national legal system, even its constitutional system, for the purpose of justifying a failure to comply with obligations and time-limits contained in Community directives”. ( 14 ) Without prejudging whether the bills which the Belgian and Italian Governments mention comply, from the point of view of substance, with the provisions of the directive, it suffices to observe that those bills, the declared object of which was to adapt national law in accordance with the principles of the directive, were not approved by the respective governments until 12 December and 19 June 1980 and their contents were not brought to the knowledge of the Commission until after those dates. As regards the Italian Republic, even if the bill had been passed before the expiry of the period laid down in the reasoned opinion and even before today, it would merely have enabled the government to adopt the measures necessary to make national law comply with the directive. It was held in the judgment of 25 May 1982 in Case 96/81 (Commission v Netherlands [1982] ECR 1791) that: “The information which the Member States are thus obliged (pursuant to the final provisions of the directive) to supply to the Commission must be clear and precise. It must indicate unequivocally the laws, regulations and administrative provisions by means of which the Member State considers that it has satisfied the various requirements imposed on it by the directive. In the absence of such information, the Commission is not in a position to ascertain whether the Member State has effectively and completely implemented the directive. The failure of a Member State to fulfil that obligation, whether by providing no information at all or by providing insufficiently clear and precise information, may of itself justify recourse to the procedure under Article 169 of the EEC Treaty in order to establish the failure to fulfil the obligation”. In those circumstances I can only advise the Court: — To declare that, by failing to adopt within the prescribed period the provisions necessary to comply with Council Directive 77/780 of 12 December 1977, the Kingdom of Belgium and the Italian Republic have failed to fulfil their obligations under the EEC Treaty; and — To order the Kingdom of Belgium and the Italian Republic to pay the costs.