(a)

It was thus contended that in accepting the export contract on which the applicant mainly relies, the latter was behaving in conformity with the Commission's observation in its decision of 23 December 1980 to the effect that it was in the interest of the Community steel industry that such patterns of trade should be maintained. It also could not foresee at that time — and here it is referring to the fact that the contract was accepted in April 1981 but was in large measure to be fulfilled after the expiration of Decision No 2794/80 — whether or not the quota system would be continued and, if it was extended, how it would be structured. The applicant also contends that when it was informed of its quota for the third quarter of 1981 and the restrictive attitude of the Commission to export deliveries, the deliveries to Libya had already used up 70% of its production quota and, on account of its domestic customers, it could not also use the rest of its quota for that purpose. Nor could it, because of the cost, consider buying quotas so as to meet the wishes of all its customers. 12500 tonnes of its production to Libya in the whole of the third quarter, and when that is compared to the applicant's statement on 2 September 1981 to the effect that 15950 tonnes in all were exported between May and August 1981, the only conclusion is that at the beginning of August — at the time at which the quotas were being communicated — at most some 8200 tonnes of the applicant's production had already been used for export. It must be added that the complaint that the Commission informed the applicant very late of its quota for the third quarter of 1981 and thereby contributed to a considerable extent to exacerbating the predicament of which the applicant complains, is surely unjustified. The Commission has rightly pointed out that, from the time Decision No 1832/81 was published at the beginning of July 1981, the undertakings concerned were aware of the essential features of the new system and could therefore obtain without difficulty some idea of the size of the production quotas. They could also get precise information about the permissible production by telephoning the Commission in good time. It also seems inappropriate that the applicant, at the very time at which it was being informed of the quota allocated to it at the beginning of August 1981, had sent off 12500 tonnes of reinforcing bars to Libya and thereby used up 70% of its production quota. It may be deduced from information supplied elsewhere by the applicant that after deliveries amounting to 7690 tonnes in the months of May and June, it had disposed of We may also wonder whether the applicant was not negligent in not fulfilling a larger part of the export contract in the second quarter of 1981, which would have somewhat eased its situation in the following months. Even if the answer must be in the negative because the export contract was so drafted that the major part of the deliveries was to take place in the period after the expiration of Decision No 2794/80, it remains in any event a fact that the applicant's assumption that the problem could be solved as a matter of course seems indefensibly careless. In view of the constantly deepening crisis, it surely could not have operated on the basis that the production quota system would end from July 1981. Since the applicant had already benefited from a substantial increase of 14000 tonnes in its production quota for the fourth quarter of 1980 in the light of export orders, it can hardly have assumed that in the context of the new quota system, designed to deal with a deepening crisis, it would be granted a further increase in its production quota which would allow it to export 17000 tonnes in the third quarter of 1981. The aforementioned comments of the Commission in its letter of 23 December 1980 that it was in the interests of the Community steel industry to maintain such patterns of exports, are not sufficient to justify such an assumption. Finally, it is not to my mind sufficiently proven that the only way out of the predicament into which the applicant had got itself by carelessly accepting a major export order in the early part of 1981, was to exceed its quota, and that a purchase of quotas was wholly unreasonable. In the administrative proceedings, the applicant claimed only that trade in quotas was not reputable and later contended that it would have lost money had it bought quotas because the price of goods exported was lower than the price for goods sold in the Common Market. That argument would in fact be convincing only if the sole reason for buying the quotas was to make its exports possible. That was not necessarily the case since the applicant's total production for the third quarter of 1981, including the unauthorized excess production, was 22973 tonnes of which only 12500 tonnes were exported. It may definitely be concluded therefore that the applicant's excess production, or at least a large part of it, went to traditional customers in the common market, for which purpose a purchase of quotas was not necessarily loss-making. When all this is borne in mind, there can be no question of declaring the applicant entirely free from blame and of justifying the excess production of which it is accused simply by the existence of a difficult situation which could not be avoided.