JUDGMENT OF THE EUROPEAN UNION CIVIL SERVICE TRIBUNAL (Third Chamber)

30 September 2010 ( )

(Civil service — Officials — Remuneration — Article 64 of the Staff Regulations — Third subparagraph of Article 3(5) and Article 9 of Annex XI to the Staff Regulations — Correction coefficient — Equal treatment)

In Case F‑29/09,

ACTION under Articles 236 EC and 152 EA,

Giorgio Lebedef and Trevor Jones, officials of the European Commission, residing respectively in Senningerberg (Luxembourg) and Ernzen (Luxembourg), represented by F. Frabetti and J.‑Y. Vergnaud, lawyers,

applicants,

v

European Commission, represented by J. Currall and D. Martin, acting as Agents,

defendant,

supported by

Council of the European Union, represented by K. Zieleśkiewicz and M. Bauer, acting as Agents,

intervener,

THE CIVIL SERVICE TRIBUNAL (Third Chamber),

composed of P. Mahoney, President, H. Kreppel and S. Van Raepenbusch (Rapporteur), Judges,

Registrar: R. Schiano, Administrator,

having regard to the written procedure and further to the hearing on 10 March 2010,

gives the following

Judgment

1 By application lodged at the Registry of the Tribunal on 30 March 2009, Mr Lebedef and Mr Jones requested the annulment of an alleged decision of the Commission of the European Communities refusing to increase the purchasing power of officials employed in Luxembourg (Luxembourg) to a level equivalent to that of officials employed in Brussels (Belgium) and, in the alternative, annulment of their pay slips as from June 2008.

Legal context

2 Under Article 64 of the Staff Regulations of Officials of the European Union (‘the Staff Regulations’):

‘An official’s remuneration expressed in [EUR] shall, after the compulsory deductions set out in these Staff Regulations or in any implementing regulations have been made, be weighted at a rate above, below or equal to 100%, depending on living conditions in the various places of employment.

… The weighting applicable to the remuneration of officials employed at the provisional seats of the Communities shall be equal to 100% as at 1 January 1962.’

3 Article 1 of Annex XI to the Staff Regulations, entitled ‘Rules for implementing Articles 64 and 65 of the Staff Regulations’, provides:

‘1. Report from the Statistical Office of the European Communities (Eurostat)

For the purposes of the review provided for in Article 65(1) of the Staff Regulations, Eurostat shall draw up every year before the end of October a report on changes in the cost of living in Brussels, the economic parities between Brussels and certain places in the Member States, and changes in the purchasing power of salaries in national civil services in central government.

…

3. Changes in the cost of living outside Brussels (economic parities and implicit indices)

…

(d) Outside Belgium and Luxembourg, changes in the cost of living during the reference period shall be measured by the implicit indices. These indices are calculated by multiplying the Brussels International Index by the change in the economic parity.

…’

4 The first subparagraph of Article 3(5) of Annex XI to the Staff Regulations provides:

‘No correction coefficient shall be applicable in Belgium and Luxembourg.’

5 In the words of Article 5(3) of Annex XI to the Staff Regulations:

‘For each place for which a correction coefficient has been set (other than Belgium and Luxembourg), an estimate for December of the economic parities mentioned in Article 1(3) shall be calculated. The change in the cost of living shall be calculated according to the rules set out in Article 1(3).’

6 Last, Article 9(1) of Annex XI to the Staff Regulations provides:

‘The appropriate authorities of the Member States concerned, the administration of an institution of the [European Union] or the representatives of officials of the [European Union] in a given place of employment can request the creation of a correction coefficient specific to that place.

This request should be supported by objective factors revealing an appreciable difference over some years in the cost of living between that place of employment and the capital of the Member State concerned (except for the Netherlands where The Hague is used instead of Amsterdam). If Eurostat confirms that the difference is appreciable (more than 5%) and sustainable, the Commission should present a proposal to set a correction coefficient for that place.’

Background to the dispute

7 Being of the view that for several years the purchasing power of officials employed in Luxembourg had consistently shown signs of falling by comparison with that of officials employed in Brussels, Mr M. Ott, President of the Solidarité Européenne trade union, wrote to Mr S. Kallas, Vice-President of the Commission, on 28 October 2005 requesting him to initiate a study into the possibility of setting a correction coefficient for Luxembourg.

8 By letter of 29 October 2005 Mr Kallas replied that it was not in the interest of the staff to initiate work with the aim of creating a correction coefficient for Luxembourg, on the ground, in particular, that such a measure required an amendment of the Staff Regulations, which entailed the risk of renegotiation of the method for the annual adaptation of remunerations, which was arrived at ‘after long and difficult negotiations in the context of the reform’.

9 On 3 April 2007 the interinstitutional trade union collective, composed of several trade unions and professional associations of the European Parliament, the Commission and the Court of Justice of the European Union, sent a memorandum to the Director-General of Eurostat requesting that he carry out a study in order to establish whether the difference in purchasing power of officials employed in Luxembourg was appreciable by comparison with those employed in Brussels, and to set in motion the procedure provided for in Article 9 of Annex XI to the Staff Regulations with a view to creating a specific correction coefficient for Luxembourg.

10 By memorandum of 6 June 2007 the Director-General of Eurostat replied that any request to establish a correction coefficient was outside the competence of Eurostat and should be addressed to the Directorate-General (DG) ‘Personnel and Administration’ of the Commission.

11 By memorandum of 12 April 2008 a number of trade unions and professional associations, acting together as a common union front, requested the Director-General of DG ‘Personnel and Administration’ to arrange an interinstitutional agreement on the loss of purchasing power of the staff of the institutions.

12 By letter of 12 September 2008, registered by the administration on 15 September 2008, the applicants lodged a complaint against their pay slips for June 2008, which contained a correction of the adjustment of remunerations which had been made at the end of 2007, but without containing a specific correction coefficient for their place of employment, and also against the pay slips for the following months.

13 By decision of 17 December 2008, notified by letter of 18 December 2008, the appointing authority rejected that complaint.

Forms of order sought by the parties and procedure

14 The applicants claim that the Tribunal should:

‘— [p]rincipally, annul the implicit refusal to increase the purchasing power of the remuneration in Luxembourg to an equivalent level to that of the purchasing powers of remuneration in Brussels;

— [i]n the alternative, annul the applicants’ pay slips issued in the period after 15 June 2008’;

— order the Commission to pay the costs.

15 The Commission contends that the Tribunal should:

— dismiss the action;

— order the applicants to pay the costs.

16 By letter received at the Registry of the Tribunal on 25 June 2009 by fax (the original having been lodged on 29 June 2009), the Council of the European Union sought leave to intervene in the case in support of the form of order sought by the Commission. The President of the Third Chamber of the Tribunal granted that request by order of 7 September 2009.

17 In its statement in intervention, which was received at the Registry of the Tribunal on 16 October 2009 by fax, the Council submitted that the Tribunal should dismiss the action as manifestly inadmissible and, in the alternative, as unfounded with respect to a plea of illegality raised by the applicants in support of their action.

Admissibility of the action

Arguments of the parties

18 The Commission maintains that the action is inadmissible, whether it is directed against the alleged refusal to create a correction coefficient for Luxembourg or against the applicants’ pay slips as from June 2008.

19 First, the Commission observes that all the steps taken prior to the complaint were of a trade union and political nature, but were not in accordance with the Staff Regulations. There was never a request, within the meaning of Article 90(1) of the Staff Regulations, from an official acting in an individual capacity.

20 In any event, in so far as it is directed against the alleged refusal to create a correction coefficient for Luxembourg, the action is out of time, as no complaint was lodged within three months of Mr Kallas’s rejection of the request of October 2005 or within three months of the Director-General of Eurostat’s refusal to carry out the requested calculations. The Commission also observes that the applicants were not the authors of the requests in question.

21 Nor does the application have the same object as the previous steps. Its main object is to complain of the absence of a correction coefficient for Luxembourg, which, in the applicants’ submission, would necessarily be higher than the correction coefficient for Brussels, whereas the previous steps concerned the absence of calculations or agreement.

22 Second, the Commission acknowledges that an action by an official against his pay slip has been held to be admissible in so far as that pay slip did not contain a correction coefficient to which the official considered he was entitled (see, to that effect, Case T‑64/92 Chavane de Dalmassy and Others v Commission [1994] ECR-SC I‑A‑227 and II‑723). However, that possibility assumes that the pay slip in question represents a change in situation or a new decision — which was not the case in June 2008.

23 At the hearing, the applicants claimed, first of all, that they were entitled to challenge directly before the Tribunal the implied refusal to increase the purchasing power of officials employed in Luxembourg to a level equivalent to the level of purchasing power of officials employed in Brussels, by establishing a specific correction coefficient; next, that the June 2008 pay slip revealed a change in situation, in that it contained a correction of the adjustment of remunerations which had been made following the annual examination carried out at the end of 2007, without containing a correction coefficient for Luxembourg; and, last, that the time-limits prescribed for lodging a complaint and bringing an action had been fully observed.

Findings of the Tribunal

The action in so far as it is directed against the alleged refusal to increase the purchasing power of officials employed in Luxembourg to a level equivalent to that of the purchasing power of officials employed in Brussels

24 It should be borne in mind that, in the system of remedies organised by Articles 90 and 91 of the Staff Regulations, an action against an implied decision rejecting a complaint requires either:

— the introduction of a request, under Article 90(1) of the Staff Regulations, by the official concerned, which, in the absence of a reply from the appointing authority within four months, is deemed to be impliedly rejected, in which case the official may, within a fresh period of three months, submit a complaint to the appointing authority, pursuant to Article 90(2) of the Staff Regulations; or

— the introduction of a prior complaint against an act adversely affecting the person concerned, pursuant to Article 90(2) of the Staff Regulations, the lack of reply whereto within a period of four months from the date of submission of the complaint being treated, in accordance with the second subparagraph of Article 90(2), as an implied decision rejecting the complaint, against which an action may be brought under Article 91 of the Staff Regulations.

25 In the present case, the pre-litigation procedure cannot be regarded as having been correctly followed by the applicants. First, the applicants failed to submit a request, under Article 90(1) of the Staff Regulations, that the purchasing power of officials employed in Luxembourg should be increased to a level equivalent to that of the purchasing power of officials employed in Brussels, since even on the assumption that the letters of 28 October 2005, 3 April 2007 and 12 April 2008 might be treated as requests within the meaning of Article 90(1) of the Staff Regulations, they did not originate with the applicants themselves.

26 Second, and in any event, the replies of 29 November 2005 from Mr Kallas and of 6 June 2007 from the Director-General of Eurostat were not acted upon during the periods prescribed for submitting a complaint and bringing an action. Likewise, no step was taken by the trade unions and professional associations after their request of 12 April 2008 failed to elicit an express reply from the Director-General of DG ‘Personnel and Administration’.

27 The action must therefore be dismissed as inadmissible in so far as it is directed against the alleged implied decision refusing to increase the purchasing power of officials employed in Luxembourg to a level equivalent to that of the purchasing power of officials employed in Brussels.

The action in so far as it is directed against the applicants’ pay slips issued from June 2008

28 It is clear from the application that the applicants raise, in substance, in support of their action against their pay slips from June 2008, pleas against the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations, in order to claim before the Tribunal that that provision is inapplicable.

29 It should be borne in mind at the outset that Article 241 EC, which was applicable on the date on which the action was brought and which, after amendment, is now Article 277 TFEU, provides that in proceedings in which the lawfulness of a regulation referred to in that provision is at issue, any party may plead, in particular, in support of an action against an implementing measure, the grounds specified in the second paragraph of Article 230 EC, now, after amendment, the second paragraph of Article 263 TFEU. It is settled case-law that that remedy is the expression of a general principle which ensures that every person has or will have had the opportunity to challenge a legal act deriving from the Union which forms the basis of a act adversely affecting him (Case 92/78 Simmenthal v Commission [1979] ECR 777; Case 262/80 Andersen and Others v Parliament [1984] ECR 195; and Case C‑11/00 Commission v ECB [2003] ECR 7147, paragraphs 74 to 78). The rule laid down in Article 241 EC is evidently applicable in proceedings brought before the Tribunal under Article 236 EC, now, after amendment, Article 270 TFEU.

30 However, it also follows from the case-law that the possibility provided by Article 241 EC of invoking the inapplicability of a regulation does not constitute an independent right of action and may only be sought incidentally, so that where there is no right to bring the main action or where the main action is inadmissible the plea of inadmissibility must also be declared inadmissible (Case 33/80 Albini v Council and Commission [1981] ECR 2141, paragraph 17, and Joined Cases 89/86 and 91/86 Étoile commerciale and CNTA v Commission [1987] ECR 3005, paragraph 22).

31 According to Articles 90 and 91 of the Staff Regulations, the complaint and, consequently, the action may be directed only against a act adversely affecting the applicant that is adopted by the appointing authority. It is also settled case-law that a act adversely affecting a person, for the purposes of Article 90(2) and Article 91(1) of the Staff Regulations, is one which produces binding legal effects such as to have a direct and immediate effect on the applicant’s interest by significantly altering his legal position (Case F‑101/05 Grünheid v Commission [2006] ECR-SC I‑A‑1‑55 and II‑A‑1‑199, paragraph 33 and the case-law cited).

32 The Tribunal must therefore ascertain whether the action, in so far as it is directed against the applicants’ pay slips issued from June 2008, meets the requirements of Articles 90 and 91 of the Staff Regulations.

33 In that regard, it must be emphasised that a pay slip, by its nature and its purpose, does not possess the characteristics of a measure aversely affecting the official concerned, since it merely represents in financial terms the substance of previous administrative decisions relating to the personal and legal situation of the official (Case F‑103/05 Pickering v Commission [2008] ECR-SC I-A-1-101 and II-A-1-527, paragraph 72, and Case F‑112/05 Bain and Others v Commission [2008] ECR-SC I-A-1-111 and II-A-1-579, paragraph 73). However, in so far as it clearly reveals the existence and the content of an administrative decision of individual application, which had hitherto not been disclosed, provided that it had not been formally notified to the official concerned, the pay slip, containing the statement of the financial rights, may be regarded as a act adversely affecting the official concerned and capable of forming the subject-matter of a complaint and, where necessary, an action (see, to that effect, Case T‑354/05 Reggimenti v Parliament [2005] ECR-SC I‑A‑33 and II‑147, paragraphs 38 and 39, concerning the reimbursement of travel expenses, or order in Case T‑181/97 Meyer and Others v Court of Justice [1998] ECR-SC I‑A‑151 and II‑481, concerning the deduction of an amount of family allowance received elsewhere). In those circumstances, the communication of the pay slip has the effect of causing time to begin to run for the purposes of lodging a complaint and bringing an action against the administrative decision adopted with respect to the official concerned and reflected in the pay slip (Pickering v Commission, paragraph 75, and Bain and Others v Commission, paragraph 76).

34 The same applies when the pay slip gives material form, for the first time, to the implementation of a new act of general application concerning the fixing of pecuniary rights, such as a decision amending the method used in calculating travel expenses (Case T‑221/02 Lebedef and Others v Commission [2003] ECR-SC I‑A‑211 and II‑1037, paragraphs 24 and 25); a decision amending a scale of parental contributions for nursery services (Case T‑297/94 Vanderhaeghen v Commission [1997] ECR-SC I‑A‑7 and II‑13); a regulation amending correction coefficients (Case T‑175/97 Bareyt and Others v Commission [2000] ECR-SC I‑A‑229 and II‑1053; Pickering v Commission; and Bain and Others v Commission); a regulation adjusting the amount of remunerations (Joined Cases T‑98/92 and T‑99/92 Di Marzio and Lebedef v Commission [1994] ECR-SC I‑A‑167 and II‑541); or a regulation introducing an exceptional crisis levy or a temporary contribution (Case 3/83 Abrias and Others v Commission [1985] ECR 1995 and Joined Cases T‑97/92 and T‑111/92 Rijnoudt and Hocken v Commission [1994] ECR-SC I‑A‑159 and II‑511).

35 In the latter situations, the first pay slip following the entry into force of an act of general application altering the pecuniary rights of an abstract category of officials necessarily represents, in regard to its addressee, the adoption of an administrative decision of individual application producing mandatory legal effects of such a kind as to have a direct and immediate effect on the interests of the official concerned. Also, even on the assumption that it might be considered that a new administrative decision of individual application is adopted every month by the appointing authority as to the determination of the official’s pecuniary rights and is reflected in the corresponding pay slip, those successive decisions would merely confirm the first decision which significantly altered the official’s legal situation in application of the new measure of general application.

36 Consequently, an official who failed, within the periods prescribed for submitting a complaint and bringing an action, to challenge the pay slip giving material form for the first time to the implementation of a measure of general application determining pecuniary rights cannot validly, after those periods have lapsed, challenge the subsequent pay slips by invoking against them the same illegality as that vitiating the first pay slip (Pickering v Commission, paragraphs 75 to 89, and Bain and Others v Commission, paragraphs 76 to 89).

37 However, the situation in the present case does not correspond to the situations described above. It is apparent on reading the applicants’ arguments that the applicants essentially take issue with the Commission’s persistent application of the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations without having carried out a study of the possible difference in purchasing power between Brussels and Luxembourg, whereas they claim that new economic circumstances have arisen which, by reference in particular to the principle of equal treatment, no longer justify the application of that provision.

38 In that regard, it should be borne in mind that the principle of equal treatment is binding on the legislature, as the Commission acknowledges, and that the establishment of weightings, provided for in Articles 64 and 65 of the Staff Regulations, is specifically intended to implement that very principle, by maintaining an equivalent purchasing power for all officials, whatever their place of employment (see, to that effect, Case 194/80 Benassi v Commission [1981] ECR 2815, paragraph 5; Case C‑301/90 Commission v Council [1992] ECR I‑221, paragraph 19; and order of 29 April 2004 in Case C‑187/03 P Drouvis v Commission, not published in the ECR, paragraph 25 and the case-law cited).

39 Where, as in the present case, the position of a party is that new factors have given rise to an obligation for the European Union to adopt new normative measures, it is for that party, as a rule, to follow the procedures prescribed by the Treaty and also by European Union legal acts (see, to that effect, Case C‑241/01 National Farmers’ Union [2002] ECR I‑9079, paragraph 38).

40 However, it must be pointed out that Article 90(1) of the Staff Regulations only empowers officials to request the administration, acting in its capacity as appointing authority, to take a decision relating to them. That is not the position in the present case, since the applicants take issue with the Commission, essentially, for not having taken the political initiatives necessary for a specific correction coefficient to be established in future for Luxembourg, which presupposes that the first subparagraph of Article 3(5) of Annex IX to the Staff Regulations must be repealed. Such a request falls outside the scope of Article 90(1) of the Staff Regulations, since a political initiative cannot be characterised as a ‘decision relating to [an official]’.

41 In those circumstances, and in the light of the procedural difficulties that would be encountered by an individual intending to bring an action for failure to act, under Article 256 TFEU, against an institution in order to have a provision of a regulation adopted by the EU legislature repealed (see, to that effect, in particular, Case C‑107/91 ENU v Commission [1993] ECR I‑599, paragraphs 16 and 17), to preclude, in application of the case-law referred to at paragraphs 33 to 36 above, the possibility for an official to challenge his pay slip on the ground of a change in factual circumstances, such as a change in economic conditions, by raising, on that occasion, a plea of illegality against a provision of the Staff Regulations which, while perhaps valid when adopted, has, in the submission of the official concerned, become unlawful as a consequence of that change in circumstances, would render it practically impossible to exercise a remedy designed to ensure compliance with the general principle of equal treatment recognised by EU law and would thus constitute a disproportionate interference with the right to effective judicial protection.

42 It is therefore appropriate, in the very particular circumstances of the case, in order to maintain their right of action, to accept that officials may challenge their pay slips by raising against a provision of the Staff Regulations fixing their pecuniary rights a plea of illegality alleging, in particular, breach of the principle of equal treatment, notwithstanding the restrictions arising under the case-law referred to at paragraphs 33 to 36 above.

43 In the light of all the foregoing, the plea alleging that the action is inadmissible in so far as it is directed against the applicants’ pay slips from June 2008 onwards must be rejected.

Merits

44 In support of their action, the applicants raise four pleas in law, the first three, which are developed together in the application, alleging breach of the principle of equal treatment and non-discrimination, the principle of sound administration and the principle of protection of legitimate expectations; and the fourth alleging breach of Article 64 of the Staff Regulations.

The first three pleas

Arguments of the parties

45 The applicants claim that the cost of living in Luxembourg is higher than in Brussels. In support of that assertion, they refer to the national minimum wage and the cost of housing and also to data disseminated by the bank UBS, informal calculations obtained by Eurostat statisticians and the assessments of colleagues who, in the context of mobility, have moved from Luxembourg to Brussels or vice versa.

46 As Luxembourg is the only place of employment without a correction coefficient, the applicants maintain that the breach of the principle of equal treatment and non-discrimination is manifest.

47 In the applicants’ submission, it is difficult, indeed impossible, to calculate a correction coefficient for Luxembourg in the absence of the international index of the cost of living in that city, which should be established by means of a survey carried out by Eurostat, which has never been done.

48 By failing to act on the staff representatives’ requests to that effect, which is apparent upon reading the pay slips for June 2008 and subsequent months, the Commission failed to comply with Article 9 of Annex XI to the Staff Regulations and breached the principle of sound administration. The applicants take the view that that Article, in referring to ‘an appreciable difference … in the cost of living between [a given] place of employment and the capital of the Member State concerned’, refers in reality to ‘an appreciable difference of purchasing power in a given place of employment by comparison with that found in the place of employment which determines the remunerations in that given place of employment as well’.

49 Last, the applicants claim that, according to consistent case-law, the right to claim protection of legitimate expectations extends to any individual on whose part the administration has given rise to well founded hopes. In the present case, the applicants were given to believe that the absence of a correction coefficient for Luxembourg meant that the Commission had carried out the necessary checks that enabled it to consider that there was justification for not making provision for such a coefficient.

50 The Commission contends that the applicants have wholly failed to explain how Article 9 of Annex XI to the Staff Regulations might have been breached, with respect to Luxembourg, since the first paragraph of Article 3(5) of that Annex, which has equal rank, precludes the possibility of a correction coefficient for Luxembourg.

51 Indeed, the Commission does not deny that the legislature is generally bound by the principle of equal treatment. However, with respect to the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations, reliance on such a complaint requires particularly detailed proof of the existence of a genuine and sustainable difference between Brussels and Luxembourg. That is what follows from the case-law in cases where a coefficient fixed by the Council, on a given occasion, for a given place of employment has been challenged. The same requirement of proof applies a fortiori where an applicant seeks to prove that the legislature disregarded, in the Staff Regulations themselves, the principle of equal treatment by taking the view that two places of employment should be treated in the same way.

52 The Commission also refers to the wide discretion which the institutions enjoy when determining the factors to be taken into consideration for the purpose of fixing correction coefficients, which has the consequence that only a manifest error of assessment or a misuse of powers may be censured by the Tribunal (see, in particular, Joined Cases T‑201/00 and T‑384/00 Ajour and Others v Commission [2002] ECR-SC I‑A‑167 and II‑885, paragraphs 47 to 49, and Bareyt and Others v Commission, paragraphs 57 and 64).

53 Yet the applicants fail to adduce the slightest evidence from which it might be inferred that there is any manifest error of assessment in relation to the absence of a coefficient for Luxembourg.

54 First of all, in 2005 the President of the trade union Solidarité européenne, claiming that it was obvious that living was more expensive in Luxembourg than in Brussels, requested the Commission to undertake a feasibility study of a specific coefficient. However, Eurostat was not empowered to conduct an investigation into the family budgets of officials employed in Luxembourg, with the aim of establishing such a coefficient, since as a matter of law the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations has the effect that such a coefficient cannot exist.

55 In addition, the Commission contends that the applicants rely merely on general and vague considerations, without the slightest proof with respect to prices, on which it might be established that the cost of living in Luxembourg is indeed appreciably and sustainably higher than the cost of living in Brussels.

56 Furthermore, the Commission maintains that the applicants’ reliance in the present case on Article 9 of Annex XI to the Staff Regulations is incorrect, since that Article concerns the creation of a coefficient for a place other than the capital of a State and not the capital itself, for which, in the case of Luxembourg, there is a special provision contained in the first paragraph of Article 3(5) of that Annex.

57 The Commission further submits that the information available about the cost of living is by no means consistent with the applicants’ assertions. It cites an example from Mercer’s Cost of Living Survey, which shows that in March 2008 the cost of living in Luxembourg (91.3) was lower than the cost of living in Brussels (92.9), the index for New York being 100.

58 As regards the alleged breach of the principle of sound administration, the Commission observes that, according to the case-law, a provision of the Staff Regulations cannot be challenged on that ground (Case T‑135/05 Campoli v Commission [2006] ECR-SC I‑A‑2‑297 and II‑A‑2‑1527, paragraph 149).

59 As for the alleged breach of the principle of the protection of legitimate expectations, the Commission contends that the applicants’ position is incoherent. The Commission would have understood it better if the applicants had maintained that the administration had actually promised them that it would establish a specific coefficient for Luxembourg but had never done so. In any event, it is precluded in law that the applicants can have had the slightest expectation of obtaining a coefficient for Luxembourg, since the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations expressly prohibits it. Any promise to that effect, if it had existed, would have been contrary to the applicable provisions and therefore incapable of giving rise to a legitimate expectation (Case T‑123/89 Chomel v Commission [1990] ECR II‑131, paragraphs 26 to 30).

Findings of the Tribunal

60 The applicants take issue with the Commission, in substance, because, the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations notwithstanding, it did not instruct Eurostat to carry out statistical investigations that would enable it to be established whether or not there was an appreciable difference in purchasing power to the detriment of officials and other servants employed in Luxembourg by comparison with the purchasing power found in Brussels. They maintain that, by its failure to act and in spite of the indicia produced by the applicants, which show that there has been an appreciable increase in the cost of living in Luxembourg in recent years, the Commission breached the principles of equal treatment, sound administration and the protection of legitimate expectations.

61 The applicants’ argument must therefore be understood as endeavouring to call in question principally the lawfulness of the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations in so far as that provision not only precludes the possibility of establishing a correction coefficient for Luxembourg but also prevents the Commission from instructing Eurostat to carry out the statistical investigations necessary to demonstrate the existence of any difference in the cost of living between Brussels and Luxembourg, even though the indicia supplied by the applicants would justify initiating such investigations.

62 In that regard, it should be borne in mind that, according to consistent case-law, the purpose of the correction coefficients affecting officials’ salaries provided for in Articles 64 and 65 of the Staff Regulations is to ensure that equivalent purchasing power is maintained for all officials, whatever their place of employment, in accordance with the principle of equal treatment (see, to that effect, Benassi v Commission, paragraph 5; Commission v Council, paragraph 19; and order in Drouvis v Commission, paragraph 25 and the case-law cited). It is for the Council, in accordance with Article 65(2) of the Staff Regulations, where it finds an appreciable variation in the cost of living, to draw the appropriate conclusions by adjusting the correction coefficients (Commission v Council, paragraph 24). The Court of Justice has added, with respect to an appreciable variation in the cost of living established between a place of employment other than the capital of the Member State under consideration and the capital, that the Council had no discretion as to whether to introduce a specific weighting for a place of employment (Commission v Council, paragraph 25).

63 It should also be borne in mind that the principle of equal treatment, which underlies the establishment of correction coefficients, provided for in Articles 64 and 65 of the Staff Regulations, is also binding on the legislature, as the Commission acknowledges.

64 In the present case, it is clear that the applicants, who allege that officials employed in Luxembourg suffer discriminatory treatment owing to the absence of a specific correction coefficient for that Member State, under the first paragraph of Article 3(5) of Annex XI to the Staff Regulations, are in a particularly difficult situation before the Tribunal as regards establishing proof, owing to the technical difficulties associated with the gathering and preparation of sufficiently reliable statistical data.

65 In those circumstances, the Commission cannot merely assert that the applicants have failed to demonstrate the existence of an appreciable and sustainable gap between Luxembourg and Brussels, in support of their plea alleging breach of the principle of equal treatment, while maintaining that it is impossible for the Commission to request Eurostat to initiate statistical investigations in that regard, on the ground that the first subparagraph of Article 3(5) of Annex XI to the Staff Regulations prohibits the establishment of a specific correction coefficient for Luxembourg. Were the Tribunal to follow it, such circular reasoning would preclude the possibility of ensuring compliance with the principle of equal treatment of officials in the field of remuneration and, in particular, the requirement to maintain equivalent purchasing power for all officials.

66 In those circumstances, in view of the technical difficulties associated with the definition and choice of basic data and statistical methods, the applicants cannot be bound to demonstrate before the Tribunal, to the requisite legal standard, the existence of an appreciable and sustainable increase in the cost of living in Luxembourg, by comparison with Brussels, capable of establishing the existence of unequal treatment of officials, according to their place of employment. All that they are required to do, as the Council conceded at the hearing, is to produce a body of sufficiently significant indicia disclosing a possible difference in purchasing power of such a kind as to place the burden of proof on the Commission and, where appropriate, to warrant administrative investigations being undertaken by Eurostat.

67 It is true that it follows from Article 65(2) of the Staff Regulations and from Article 9(1) of Annex XI to those Regulations that only an appreciable increase in the cost of living in Luxembourg by comparison with Brussels could justify the adoption of adjustment measures for the purpose of ensuring equivalence of purchasing power between officials employed in Luxembourg and their colleagues working in Brussels. The principle of equal treatment cannot require perfect identity of officials’ purchasing power, whatever their place of employment, but substantial correspondence of the cost of living between the places of employment concerned. In view of the complexity of the matter, the legislature has in that regard a wide discretion and intervention by the judicature must be limited to examining whether the institutions remained within reasonable limits by reference to the considerations which prompted their action and did not use their powers in a manifestly incorrect manner (see, to that effect, Joined Cases T‑544/93 and T‑566/93 Abello and Others v Commission [1995] ECR-SC I‑A‑271 and II‑815, paragraph 76).

68 However, even though the applicants’ written pleadings are not very clear in that regard, the main complaint put forward in support of the present action does indeed appear to be that the Commission persisted in applying the first paragraph of Article 3(5) of Annex XI to the Staff Regulations without having undertaken a study of the possible difference in purchasing power between Brussels and Luxembourg. In such a context, judicial review is not limited to ascertaining whether there has been a manifest error of assessment, but goes to whether or not the applicants have adduced sufficient indicia, such as sufficiently substantiated figure-based or other studies from an authorised source, that would justify initiating an investigation.

69 However, in the present case, the applicants merely formulate a number of rather abstract considerations without providing the slightest evidence susceptible of establishing at least a semblance of an appreciable difference warranting the initiation of statistical investigations by Eurostat. In their application the applicants mention:

— ‘data disseminated by UBS’, although those data are neither explained nor even produced;

— unsubstantiated assertions relating to the national minimum wage, the price of accommodation and the price of renting offices in Luxembourg;

— ‘information obtained from colleagues who, in the context of mobility, have moved from Luxembourg to Brussels or from Brussels to Luxembourg and have found that their purchasing power in Luxembourg is lower than that in Brussels’, without more specific comment;

— ‘informal calculations obtained by Eurostat statisticians’, also without further comment;

— a letter of 6 March 2006 from the Director of Resources of the NATO Maintenance and Supply Agency, in which that Director merely expresses his concern at the ‘increasing gap between the cost of living in Brussels and [the cost of living] in Luxembourg’;

— and other assertions made in correspondence and trade union literature annexed to the application.

70 Such indicia are not sufficient to establish a semblance of an appreciable and sustainable difference in the cost of living between the two places of employment in question, which, in the absence of a specific correction coefficient for Luxembourg, would substantially reduce the purchasing power of officials employed in Luxembourg by comparison with that of their colleagues working in Brussels, particularly since the Commission, for its part, has produced evidence suggesting, on the contrary, that the cost of living is not as high in Luxembourg as in Brussels (see paragraph 57 above).

71 As for the alleged breach of the principle of sound administration, moreover, it is sufficient to observe that, in any event, a provision of the Staff Regulations properly adopted by the Council cannot be called in question on the ground of an alleged breach of such a principle (Case T‑256/01 Pyres v Commission [2005] ECR-SC I‑A‑23 and II‑99, paragraph 66, and Campoli v Commission, paragraph 149).

72 Last, as regards the alleged breach of the principle of protection of legitimate expectations, it also suffices to observe that the applicants have not been able to establish that they obtained precise assurances from the administration as to the presence of an appreciable gap, with respect to officials’ purchasing power, between Brussels and Luxembourg, or indeed as to the future adoption of a correction coefficient for Luxembourg. In any event, an official cannot rely on the principle of protection of legitimate expectations in order to challenge the legality of a provision of the Staff Regulations, in this case the first paragraph of Article 3(5) of Annex XI to the Staff Regulations, and to object to its application, as promises made by the administration which do not have regard to the provisions of the Staff Regulations cannot give rise to a legitimate expectation on the part of the person to whom they are addressed (see, to that effect, Chomel v Commission, paragraphs 26 to 30, and Case T‑175/03 Schmitt v EAR [2004] ECR-SC I‑A‑211 and II‑939, paragraphs 46 and 47).

73 It is important to emphasise, in that regard, that the action is not directed against the refusal to comply with a request to carry out a statistical investigation, but, in particular, against the pay slips, on the basis of a plea of illegality directed against a provision of the Staff Regulations.

74 In view of all the foregoing, the first three pleas must be rejected.

The fourth plea

Arguments of the parties

75 The applicants note that, according to the second paragraph of Article 64 of the Staff Regulations, the weighting ‘applicable to the remuneration of officials employed at the provisional seats of the Communities shall be equal to 100% as at 1 January 1962’. That, in their submission, means that over the years the weighting for Luxembourg may change. The applicants maintain that Annex XI cannot limit the scope of Article 64 and they challenge the legality of Article 1(3)(d), Article 3(5) and Article 5(3) of Annex XI to the Staff Regulations, which refer to Luxembourg.

76 The applicants submit that there is a legal link between the contested individual decision, namely the Commission’s refusal to increase the purchasing power of remuneration in Luxembourg to a level equivalent to that of the purchasing power of remuneration in Brussels, and the general measure called in question, and that their plea of illegality is limited to what is essential to the outcome of the dispute.

77 The Commission and the Council contend that the applicants put forward no argument in support of their fourth plea and that this plea must therefore be rejected as inadmissible pursuant to Article 35(1)(d) and (e) of the Rules of Procedure.

78 As regards the merits, the Commission submits that, contrary to what the applicants suggest, Article 64 of the Staff Regulations is not of a higher rank than the provisions of Annex XI. There is therefore no scope for maintaining that the latter provisions may have infringed Article 64.

79 In reality, all the provisions referred to are of equal rank and should therefore be read together in order to ensure that they are given a harmonious interpretation. Article 64 of the Staff Regulations cannot mean that a specific weighting may be adopted for Luxembourg, since that would amount to interpreting that Article in such a way as to depart from the clear wording of Article 3(3) or (5) of Annex XI. On the contrary, Article 64 must be understood as referring to cases other than those to which particular provisions apply, such as those relating to Luxembourg.

80 The Council shares the Commission’s opinion in that regard and adds that, in so far as the applicants seek to take issue with the provisions in issue in the light of the principle of equal treatment, it follows from Annex XI, and in particular from Article 9(1) thereof, that it was not the legislature’s objective to ensure perfect identity, at any time, between the purchasing power of officials employed in different places. That provision states that a request to create a new correction coefficient ‘should be supported by objective factors revealing an appreciable difference over some years in the cost of living between [a given] place of employment and the capital of the Member State concerned’. Furthermore, as Advocate General Capotorti observed in his Opinion in Case 158/79 Roumengous Carpentier v Commission [1982] ECR 4379, ‘adjustment of the weightings is compulsory only in the event of a substantial increase in the cost of living[, f]rom which it may be inferred that the aim of the Community legislature is not to ensure absolutely identical treatment (identical purchasing power regardless of the place of employment), but substantial and reasonable equivalence of treatment, [with] possible minor differences’. Even on the assumption that Article 9(1) of Annex XI to the Staff Regulations could be transposed, by analogy, to the present case, it would follow that the lawfulness of the provisions in issue concerning Luxembourg, in the light of the principle of equal treatment, could be called in question only where objective evidence revealed a significant and sustainable difference in the cost of living between Brussels and Luxembourg.

81 In fact the applicants have adduced no objective evidence revealing such a difference between the two capitals, let alone that such a difference was appreciable and sustainable.

Findings of the Tribunal

82 The applicants claim, in substance, that the provisions of Annex XI to the Staff Regulations, and in particular the first paragraph of Article 3(5) thereof, cannot depart from Article 64 of the Staff Regulations, the letter and spirit of which necessarily mean that the weightings affecting officials’ remuneration may be amended according to the living conditions in the different places of employment.

83 In that regard, it is true that ‘Article 65a of the Staff Regulations provides that the rules for implementing Articles 64 and 65 are set out in Annex XI’. It may be inferred that those implementing rules cannot depart from the basic rules laid down in Articles 64 and 65 of the Staff Regulations. Generally, moreover, while there is not, strictly speaking, a formal hierarchy between the organic rules of the Staff Regulations and the Annexes to those Regulations, as both categories of norms are adopted by the Council, there might exist between them, depending on the case, a substantive hierarchy, given that the Annexes must be interpreted by reference to the foundations and the system of the European Union civil service, as determined by the Staff Regulations in the strict sense.

84 In the present case, however, the applicants have not established that the provisions of Annex XI and, in particular, the first paragraph of Article 3(5) thereof, disregard an essential rule set out in Article 64 of the Staff Regulations, as they have failed to show that the legislature had unlawfully considered that living conditions in Brussels and in Luxembourg did not justify the establishment of separate weightings. The question whether such an assessment constitutes a breach of the principle of equal treatment or is vitiated by a manifest error of assessment was specifically examined in the context of the first three pleas put forward in support of the action.

85 In the light of the foregoing, the fourth plea and, accordingly, the entire action must be rejected.

Costs

86 Under Article 87(1) of the Rules of Procedure, without prejudice to the other provisions of Chapter 8 of Title II of those Rules, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Under Article 87(2), if equity so requires, the Tribunal may decide that an unsuccessful party is to pay only part of the costs or even that he is not to be ordered to pay any.

87 It follows from the grounds set out above that the applicants have been unsuccessful. Furthermore, in its pleadings the Commission expressly requested that the applicants be ordered to pay the costs. Since the circumstances of this case do not warrant the application of the provisions of Article 87(2) of the Rules of Procedure, the applicant must be ordered to pay the costs.

88 Under Article 89(4) of the Rules of Procedure, moreover, interveners are to bear their own costs.

On those grounds,

THE CIVIL SERVICE TRIBUNAL (Third Chamber)

hereby:

1. Dismisses the action;

2. Orders Mr Lebedef and Mr Jones to pay all the costs, with the exception of those incurred by the Council of the European Union;

3. Orders the Council of the European Union, intervener, to bear its own costs.

Mahoney Kreppel Van Raepenbusch

Delivered in open court in Luxembourg on 30 September 2010.

W. Hakenberg P. Mahoney