Judgment of the Court of 1 March 1983. - Commission of the European Communities v Italian Republic. - Failure of a State to fulfil its obligations - Failure to implement the first Council directive on credit institutions. - Case 300/81.



European Court reports 1983 Page 00449



Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

MEASURES OF INSTITUTIONS - DIRECTIVES - IMPLEMENTATION BY THE MEMBER STATES - CONDITIONS

( EEC TREATY , ART . 189 , THIRD PARAGRAPH ; COUNCIL DIRECTIVE 77/780 )

Summary

DIRECTIVE 77/780 IS INTENDED TO REDUCE THE DISCRETION WHICH THE SUPERVISORY AUTHORITIES OF CERTAIN MEMBER STATES ENJOY IN AUTHORIZING CREDIT INSTITUTIONS . FROM THAT POINT OF VIEW IT IS ESSENTIAL THAT EACH MEMBER STATE SHOULD IMPLEMENT THE DIRECTIVE IN A WAY WHICH FULLY SATISFIES THE REQUIREMENTS OF CLARITY AND CERTAINTY IN LEGAL SITUATIONS WHICH THE DIRECTIVE SEEKS . MERE ADMINISTRATIVE PRACTICES , WHICH BY THEIR NATURE CAN BE CHANGED AS AND WHEN THE AUTHORITIES PLEASE AND WHICH ARE NOT PUBLICIZED WIDELY ENOUGH , CANNOT IN THESE CIRCUMSTANCES BE REGARDED AS A PROPER FULFILMENT OF THE OBLIGATIONS IMPOSED BY THE THIRD PARAGRAPH OF ARTICLE 189 ON MEMBER STATES TO WHICH THE DIRECTIVE IS ADDRESSED .

Parties

IN CASE 300/81

COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY ITS LEGAL ADVISER , ANTONINO ABATE , ACTING AS AGENT , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF ORESTE MONTALTO , A MEMBER OF THE COMMISSION ' S LEGAL DEPARTMENT , JEAN MONNET BUILDING , KIRCHBERG ,

APPLICANT ,

V

ITALIAN REPUBLIC , IN THE PERSON OF ITS AGENT , ARNALDO SQUILLANTE , REPRESENTED AND ASSISTED BY PIER GIORGIO FERRI , AVVOCATO DELLO STATO , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE ITALIAN EMBASSY ,

DEFENDANT ,

Subject of the case

APPLICATION FOR A DECLARATION THAT THE ITALIAN REPUBLIC HAS FAILED TO FULFIL ITS OBLIGATIONS UNDER THE EEC TREATY BY FAILING TO BRING INTO FORCE WITHIN THE PRESCRIBED PERIOD THE PROVISIONS NECESSARY TO COMPLY WITH COUNCIL DIRECTIVE 77/780/EEC OF 12 DECEMBER 1977 ON THE COORDINATION OF THE LAWS , REGULATIONS AND ADMINISTRATIVE PROVISIONS RELATING TO THE TAKING UP AND PURSUIT OF THE BUSINESS OF CREDIT INSTITUTIONS ( OFFICIAL JOURNAL 1977 , L 322 , P . 30 ),

Grounds

1 BY APPLICATION LODGED AT THE COURT REGISTRY ON 30 NOVEMBER 1981 THE COMMISSION OF THE EUROPEAN COMMUNITIES BROUGHT AN ACTION UNDER ARTICLE 169 OF THE EEC TREATY FOR A DECLARATION THAT , BY FAILING TO ADOPT WITHIN THE PRESCRIBED PERIOD THE PROVISIONS NECESSARY TO COMPLY WITH COUNCIL DIRECTIVE 77/780/EEC OF 12 DECEMBER 1977 ON THE COORDINATION OF THE LAWS , REGULATIONS AND ADMINISTRATIVE PROVISIONS RELATING TO THE TAKING UP AND PURSUIT OF THE BUSINESS OF CREDIT INSTITUTIONS ( OFFICIAL JOURNAL 1977 , L 322 , P . 30 ), THE ITALIAN REPUBLIC FAILED TO FULFIL ITS OBLIGATIONS UNDER THE THIRD PARAGRAPH OF ARTICLE 189 OF THE TREATY .

2 THE CASE MUST BE CONSIDERED IN THE LIGHT OF THE BACKGROUND TO THE DIRECTIVE AND THE EVENTS WHICH PRECEDED THE COMMENCEMENT OF THESE PROCEEDINGS .

3 COUNCIL DIRECTIVE 77/780 CONSTITUTES THE FIRST STEP IN THE HARMONIZATION OF BANKING STRUCTURES AND THE SUPERVISION THEREOF . THE PURPOSE OF SUCH HARMONIZATION IS TO PERMIT THE GRADUAL ATTAINMENT OF FREEDOM OF ESTABLISHMENT FOR CREDIT INSTITUTIONS AND THE LIBERALIZATION OF BANKING SERVICES . IN THAT RESPECT THE DIRECTIVE INTRODUCES CERTAIN MINIMUM CONDITIONS FOR THE AUTHORIZATION OF CREDIT INSTITUTIONS WHICH ALL MEMBER STATES MUST OBSERVE . IN ORDER TO FACILITATE THE TAKING UP AND PURSUIT OF BUSINESS AS A CREDIT INSTITUTION THE DIRECTIVE AIMS IN PARTICULAR TO REDUCE THE DISCRETION ENJOYED BY CERTAIN SUPERVISORY AUTHORITIES IN AUTHORIZING CREDIT INSTITUTIONS .

4 ARTICLE 14 ( 1 ) OF THE DIRECTIVE PROVIDES THAT MEMBER STATES MUST BRING INTO FORCE THE MEASURES NECESSARY TO COMPLY THEREWITH WITHIN 24 MONTHS OF ITS NOTIFICATION . THAT PERIOD EXPIRED IN THE PRESENT CASE ON 15 DECEMBER 1979 . AS A RESULT OF THE DIRECTIVE A BILL WAS PREPARED IN ITALY AND WAS BEFORE THE ITALIAN PARLIAMENT WHEN THE COMMISSION ' S ACTION FOR A DECLARATION WAS BROUGHT ; THE BILL DELEGATES TO THE EXECUTIVE THE POWER TO ADOPT MEASURES TO IMPLEMENT THE DIRECTIVE .

5 IN ITS DEFENCE THE ITALIAN GOVERNMENT EMPHASIZES THAT COMPARISON OF THE NATIONAL RULES IN FORCE IN ITALY WITH THE MAIN PROVISIONS OF THE DIRECTIVE REVEALS SUBSTANTIAL AGREEMENT WHICH SHOULD NOT BE UNDERESTIMATED . IN THE VIEW OF THE ITALIAN GOVERNMENT , THE FACT THAT THE AUTHORITIES SUPERVISING CREDIT INSTITUTIONS COMPLY IN PRACTICE WITH THE COMMUNITY RULES SHOWS THAT THE NATIONAL PROVISIONS APPLIED BY THOSE AUTHORITIES ACCORD WITH THE PROVISIONS OF THE DIRECTIVE .

6 HOWEVER , THE ITALIAN GOVERNMENT INVOKED THAT ARGUMENT ONLY DURING THE COURSE OF THE ACTION BEFORE THE COURT AND CONFINED ITSELF DURING THE PROCEDURE PRIOR TO ACTION TO STATING THAT A LAW WAS IN PREPARATION TO ENABLE THE GOVERNMENT TO ADOPT THE NECESSARY MEASURES .

7 THAT MANNER OF PROCEEDING DOES NOT COMPLY WITH THE OBLIGATION IMPOSED BY ARTICLE 14 ( 1 ) OF DIRECTIVE 77/780 , WHICH REQUIRES MEMBER STATES IMMEDIATELY TO SUPPLY THE COMMISSION WITH ALL NECESSARY INFORMATION CONCERNING THE MEASURES WHICH HAVE BEEN TAKEN TO COMPLY WITH THE DIRECTIVE .

8 HOWEVER , THE ACTION BROUGHT BY THE COMMISSION SEEKS SOLELY A FINDING THAT THE ITALIAN REPUBLIC FAILED TO FULFIL ITS OBLIGATIONS UNDER THE EEC TREATY ' ' BY FAILING TO ADOPT WITHIN THE PRESCRIBED PERIOD THE PROVISIONS NECESSARY TO COMPLY WITH COUNCIL DIRECTIVE 77/780/EEC ' ' AND THUS DOES NOT CONCERN THE OBLIGATION UNDER ARTICLE 14 OF THE DIRECTIVE TO SUPPLY INFORMATION . IT IS THUS WITHIN THOSE LIMITS THAT THE ITALIAN GOVERNMENT ' S SUBMISSION MUST BE ANSWERED .

9 IN THAT RESPECT IT APPEARS THAT BOTH THE ITALIAN BANKING LEGISLATION IN FORCE AND THE DIRECTIVE ESTABLISH THE FUNDAMENTAL PRINCIPLE THAT CREDIT INSTITUTIONS REQUIRE AUTHORIZATION . NEVERTHELESS , AS THE ITALIAN GOVERNMENT ITSELF RECOGNIZES , ITALIAN NATIONAL LAW , AS DISTINCT FROM THE DIRECTIVE , DOES NOT LAY DOWN OBJECTIVE CRITERIA FOR THE GRANT OR REFUSAL OF AUTHORIZATION . IT IS MERELY CLAIMED THAT THE ADMINISTRATIVE AUTHORITIES OBSERVE SUCH CRITERIA IN PRACTICE BY EXERCISING THE POWER TO GRANT AUTHORIZATION IN A MANNER COMPATIBLE WITH THE PROVISIONS OF THE DIRECTIVE .

10 IT IS APPARENT FROM THE PREAMBLE THERETO THAT THE DIRECTIVE IS INTENDED TO REDUCE THE DISCRETION WHICH THE SUPERVISORY AUTHORITIES OF CERTAIN MEMBER STATES ENJOY IN AUTHORIZING CREDIT INSTITUTIONS . FROM THAT POINT OF VIEW IT IS NOT POSSIBLE TO REGARD A MEMBER STATE AS HAVING FULFILLED THE OBLIGATION WHICH THE DIRECTIVE IMPOSES ON IT WHEN IT HAS CONFINED ITSELF TO MEETING THE REQUIREMENTS OF THE DIRECTIVE BY MEANS OF ITS PRACTICE . IT IS INDEED ESSENTIAL THAT EACH MEMBER STATE SHOULD IMPLEMENT THE DIRECTIVE IN QUESTION IN A WAY WHICH FULLY SATISFIES THE REQUIREMENTS OF CLARITY AND CERTAINTY IN LEGAL SITUATIONS WHICH THE DIRECTIVE SEEKS IN THE INTERESTS OF THE INSTITUTIONS WHICH ARE TO BENEFIT FROM THE AUTHORIZATION PROVIDED FOR IN THE DIRECTIVE . MERE ADMINISTRATIVE PRACTICES , WHICH BY THEIR NATURE CAN BE CHANGED AS AND WHEN THE AUTHORITIES PLEASE AND WHICH ARE NOT PUBLICIZED WIDELY ENOUGH , CANNOT IN THESE CIRCUMSTANCES BE REGARDED AS A PROPER FULFILMENT OF THE OBLIGATIONS IMPOSED BY THE THIRD PARAGRAPH OF ARTICLE 189 ON MEMBER STATES TO WHICH THE DIRECTIVE IS ADDRESSED .

11 IT IS THEREFORE PROPER 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 ITALIAN REPUBLIC FAILED TO FULFIL ITS OBLIGATIONS UNDER THE TREATY .

Decision on costs

COSTS

12 UNDER ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY IS TO BE ORDERED TO PAY THE COSTS .

13 SINCE THE DEFENDANT HAS FAILED IN ITS SUBMISSIONS IT MUST BE ORDERED TO PAY THE COSTS .

Operative part

ON THOSE GROUNDS ,

THE COURT

HEREBY :

1 . DECLARES THAT , BY NOT ADOPTING WITHIN THE PRESCRIBED PERIOD THE PROVISIONS NECESSARY TO COMPLY WITH COUNCIL DIRECTIVE 77/780 OF 12 DECEMBER 1977 ON THE COORDINATION OF LAWS , REGULATIONS AND ADMINISTRATIVE PROVISIONS RELATING TO THE TAKING UP AND PURSUIT OF THE BUSINESS OF CREDIT INSTITUTIONS ( OFFICIAL JOURNAL 1977 , L 322 , P . 30 ), THE ITALIAN REPUBLIC FAILED TO FULFIL ITS OBLIGATIONS UNDER THE EEC TREATY ;

2 . ORDERS THE DEFENDANT TO PAY THE COSTS .