Keywords

Summary



Keywords

1 Procedure - Intervention - Objection of inadmissibility not raised by the defendant - Inadmissible - Absolute bar to proceeding with a case - Consideration by the Court of its own motion

(ECSC Statute of the Court of Justice, Arts 34, second para., and 46, first para.; Rules of Procedure of the Court of First Instance, Arts 113 and 116(3))

2 Actions for annulment - Action brought by an association of undertakings against an individual ECSC decision not addressed to it -Decision authorizing the payment of State aid to undertakings competing with its members

(ECSC Treaty, Arts 33, second para., and 48)

3 ECSC - Aid to the steel industry - Authorization by the Commission - General decisions and individual decisions - Adoption of individual decisions to authorize aid not falling within the categories of aid authorized by a general decision - Whether permissible

(ECSC Treaty, Arts 2, 3, 4, 5 and 95)

4 ECSC - Aid to the steel industry - Authorization by the Commission - Conditions - Reconciliation of Treaty objectives - Commission's discretion - Proportionality - Account taken of political, economic and social considerations - Review by the Court

(ECSC Treaty, Arts 2, 3 4, 5 and 95)

5 ECSC - Aid to the steel industry - Authorization by the Commission - Conditions - No distortion of competition contrary to the common interest

(ECSC Treaty, Arts 3 and 4)

Summary

6 Pursuant to the second paragraph of Article 34 and the first paragraph of Article 46 of the ECSC Statute of the Court of Justice and Article 116(3) of the Rules of Procedure of the Court of First Instance, interveners are required to accept the case as they find it at the time of their intervention and the submissions made in their applications are to be limited to supporting the submissions of one of the parties. An intervener therefore has no standing to rely on an objection of inadmissibility where this has not been raised in the submissions of the defendant.

However, under Article 113 of the Rules of Procedure, the Court may at any time of its own motion consider whether there exists any absolute bar to proceeding with a case, including any raised by the interveners.

7 Associations, within the meaning of Article 48 of the ECSC Treaty, comprising steel undertakings and representing the common interests of their members, are concerned, within the meaning of the second paragraph of Article 33 of that Treaty, by decisions authorizing the payment of State aid to undertakings competing with their members.

8 In the scheme of the ECSC Treaty, Article 4(c) does not preclude the Commission from authorizing, by way of derogation, aid envisaged by the Member States and compatible with the objectives of the Treaty, on the basis of the first and second paragraphs of Article 95, in order to deal with unforeseen situations.

The first and second paragraphs of Article 95 empower the Commission to adopt a decision or a recommendation with the unanimous assent of the Council and after the ECSC Consultative Committee has been consulted, in all cases not provided for by the Treaty in which such a decision or recommendation appears necessary in order to attain, within the common market in coal and steel and in accordance with Article 5, one of the objectives of the Community set out in Articles 2, 3 and 4. They provide that any decision or recommendation so made is to determine what penalties, if any, may be imposed.

The Commission is thus competent, in the absence of any specific Treaty provision, to adopt any general or individual decision necessary for attainment of the objectives of the Treaty. The first and second paragraphs of Article 95, which confer that power upon it, do not give any specific indication of the scope of the decisions which the Commission may adopt. In those circumstances, it is for the Commission to assess in each case which of the two kinds of decision, general or individual, is the most appropriate to attainment of the objectives pursued.

A general decision, such as the Steel Aid Code, is only intended to authorize generally, and subject to certain conditions, derogations from the prohibition of aid for certain categories of aid which it lists exhaustively. Aid not falling into categories which the Code exempts from that prohibition therefore remains subject exclusively to Article 4(c). It follows that, where such aid nevertheless proves necessary to attain the objectives of the Treaty, the Commission is empowered to rely on Article 95 of the Treaty in order to deal with that unforeseen situation, if need be by means of an individual decision.

9 In the context of implementation of the ECSC Treaty, the Commission considers in its discretion whether aid intended to accompany the restructuring measures in the steel industry is compatible with the fundamental principles of the Treaty. In view of the diversity of the objectives determined by the Treaty, the Commission's role consists in ensuring that those various objectives are reconciled at all times, exercising the discretion available to it in order to meet the requirements of the common interest.

In that regard, the rationalization of the European steel industry through the restructuring of certain groups, the closure of obsolete or uncompetitive plant, the reduction of excess capacity, privatization of a group in order to ensure its viability and, within reasonable limits, the shedding of jobs, contribute to attainment of the objectives of the Treaty, having regard to the sensitive nature of the steel industry and the fact that continuation, or indeed aggravation, of the crisis is liable to give rise to extremely serious and enduring disturbances of the economies of the Member States concerned. It follows that Commission decisions authorizing the grant of State aid for the purposes of such rationalization are intended to safeguard the common interest, in accordance with the objectives of the Treaty.

However, the Commission would under no circumstances be entitled to authorize the granting of State aid which was not necessary to attain the objectives of the Treaty and would be likely to give rise to distortions of competition on the common market in steel.

Moreover, for those decisions, adopted in relation to a steel market characterized by excess production capacity, to be regarded as in conformity with the principle of proportionality, it is necessary to verify whether they require the beneficiary undertakings to make appropriate closures and reductions of capacity as a counterpart to the aid authorized.

In that regard, no exact quantitative ratio has to be established between the amount of the aid and the size of the required cuts in production capacity. On the contrary, the factors which are liable to influence the exact amounts of the aid to be authorized do not consist simply in the number of tonnes of production capacity having to be cut; there are other factors, too, which vary from one region of the Community to another, such as the restructuring effort made, the regional and social problems occasioned by the crisis in the steel industry, technical change and the adaptation of undertakings to suit market requirements. It follows that the Commission's assessment cannot be subjected to a review based solely on economic criteria. The Commission may legitimately take account of a wide variety of political, economic and social considerations in exercising its discretion under Article 95 of the Treaty.

10 Although any aid to the steel industry is likely to favour one undertaking in relation to another, the Commission cannot approve aid the grant of which may result in distortions of competition to an extent contrary to the common interest. Specifically, the Commission's obligation under Article 3 of the Treaty to act in the common interest does not mean that it must act in the interest of all those involved without exception, for its function does not entail an obligation to act only on condition that no interest is affected. On the other hand, when taking action it must weigh up the various interests, avoiding harmful consequences where the decision to be taken reasonably so permits. The Commission may, in the general interest, exercise its decision-making power according to the requirements of the situation, even to the detriment of certain individual interests.