Case T-19/01

Chiquita Brands International, Inc. and Others

v

Commission of the European Communities

(Common organisation of the markets – Bananas – Action for compensation – Regulation (EC) No 2362/98 – Agreement establishing the WTO and annexed agreements – Recommendations and rulings of the dispute settlement body of the WTO)

Judgment of the Court of First Instance (Fifth Chamber, Extended Composition), 3 February 2005

Summary of the Judgment

1. Procedure – Originating application – Formal requirements – Identification of the subject-matter of the dispute – Brief summary of the pleas in law on which the application is based – Action for compensation for damage caused by a Community institution – Minimum requirements

(Rules of Procedure of the Court of First Instance, Art. 44(1)(c))

2. Non-contractual liability – Conditions – Unlawfulness – Damage – Causal link – Not possible to rely on WTO Agreements in order to challenge the legality of a Community measure – Exceptions – Community measure designed to ensure implementation of a WTO obligation or referring to it expressly and precisely – No such measure – Community liability – Excluded

(Art. 288, second para., EC; Council Regulations Nos 404/93 and 1637/98; Commission Regulation No 2362/98)

3. Agriculture – Common organisation of the markets – Bananas – System of importation – Tariff quota – Introduction and allocation – Delegation of implementing power to the Commission, implying a broad discretion of the latter

(Art. 211 EC; Council Regulations Nos 404/93, Art. 19(1) and 1637/98)

4. Agriculture – Common organisation of the markets – Bananas – System of importation – Tariff quota – Introduction and allocation – Principle of non-discrimination – Infringement – None

(Council Regulations Nos 404/93 and 1637/98; Commission Regulations Nos 1442/93 and 2362/98)

5. Agriculture – Common organisation of the markets – Bananas – System of importation – Tariff quota – Introduction and allocation – Freedom to pursue a trade or profession – Infringement – None

(Council Regulations Nos 404/93 and 1637/98; Commission Regulation No 2362/98)

6. Agriculture – Common organisation of the markets – Bananas – System of importation – Tariff quota – Introduction and allocation – Principle of proportionality – Infringement – None

(Council Regulations Nos 404/93 and 1637/98; Commission Regulation No 2362/98)

7. Agriculture – Common organisation of the markets – Bananas – System of importation – Tariff quota – Introduction and allocation – Principle of the protection of legitimate expectations – Infringement – None

(Council Regulations Nos 404/93 and 1637/98; Commission Regulation Nos 1442/93 and 2362/98)

1. Under Article 44(1)(c) of the Rules of Procedure of the Court of First Instance, every application must state the subject-matter of the proceedings and contain a summary of the pleas in law on which it is based. That statement must be sufficiently clear and precise to enable the defendant to prepare its defence and the Court to rule on the application, if necessary, without any further information. In order to guarantee legal certainty and sound administration of justice it is necessary, in order for an action to be admissible, that the basic legal and factual particulars relied on be indicated, at least in summary form, coherently and intelligibly in the application itself.

In order to satisfy those requirements, an application seeking compensation for damage caused by a Community institution must state the evidence from which the conduct which the applicant alleges against the institution can be identified, the reasons why the applicant considers there is a causal link between the conduct and the damage it claims to have suffered, and the nature and extent of that damage.

(see paras 64-65, 191)

2. For the Community to incur non-contractual liability within the meaning of the second paragraph of Article 288 EC, a series of conditions must be met, namely the conduct of which the institutions are accused must have been unlawful, the damage must be real and a causal connection must exist between that conduct and the damage in question. Having regard to their nature and general scheme, the WTO Agreement and its annexes are not, in principle, among the rules in the light of which the Court of Justice and the Court of First Instance will review the legality of acts of the Community institutions.

It is only where the Community intended to implement a particular obligation assumed in the context of the WTO, or where the Community measure refers expressly to the precise provisions of the agreements included in the annexes to the WTO Agreement, that it is for the Court of Justice and the Court of First Instance to review the legality of the Community measure in question in the light of the WTO rules.

In adopting the 1999 regime, and in particular Regulation No 2362/98 laying down detailed rules for the implementation of Regulation No 404/93 regarding imports of bananas into the Community, the Community did not intend to implement a particular obligation assumed in the context of the WTO Agreements within the meaning of the case-law. Therefore, the applicant is not in a position to plead infringement by the Community of its obligations under those Agreements.

(see paras 76, 114-115, 170)

3. In accordance with the wording of the fourth indent of Article 211 EC, the Commission, in order to ensure the proper functioning and development of the common market, is required to exercise the powers conferred on it by the Council for the implementation of the rules laid down by the latter. It follows from the Treaty context in which that article must be placed and also from practical requirements, that the concept of implementation must be given a wide interpretation. Since only the Commission is in a position to keep track of agricultural market trends and to act quickly whenever necessary, the Council may confer on it wide powers in that sphere. Consequently, the limits of those powers must be determined by reference, amongst other things, to the essential general aims of the market organisation, the Commission being authorised to adopt all the measures which are necessary or appropriate for the implementation of the basic legislation, provided that they are not contrary to such legislation or to the implementing legislation adopted by the Council.

Since, in this case, the Council required the Commission to adopt measures for managing tariff quotas in accordance with the method based on taking account of traditional trade flows pursuant to Article 19(1) of Regulation No 404/93 on the common organisation of the market in bananas, as amended by Regulation No 1637/98, and to take measures needed to ensure respect for obligations stemming from agreements concluded by the Community under Article 300 EC, the applicant has not established that the Commission manifestly exceeded the discretion conferred upon it by the Council when it sought to reconcile those objectives by enacting measures for distributing import licences and allocating national quotas, laid down by Regulation No 2362/98 laying down detailed rules for the implementation of Regulation No 404/93 regarding imports of bananas into the Community.

(see paras 183-185)

4. Although operators trading Latin American bananas and those trading Community or ACP bananas were affected in a different way by the 1993 regime, such a difference in treatment appears to be inherent in the objective of integrating previously compartmentalised markets and providing an outlet for bananas of Community and ACP origin.

Whilst, following the creation of the common organisation of the market in bananas and during the five years in which the 1993 regime remained in force, the Community market in bananas went through major changes, the provisions of Regulation No 1637/98 amending Regulation No 404/93 on the common organisation of the market in bananas did not alter those objectives of integrating previously compartmentalised markets and providing an outlet for bananas of Community and ACP origin, but were limited to reformulating the detailed rules for the functioning of the regime for trade with non-member countries. Therefore, under the 1999 regime, the difference in treatment between those operators remains inherent in the objectives of the common organisation of the market in bananas and, in such circumstances, does not constitute an infringement of the principle of non-discrimination capable of rendering the Community liable.

(see paras 207, 209, 211-212)

5. The freedom to pursue a trade or profession may be restricted, particularly in the context of a common organisation of the market, provided those restrictions in fact correspond to objectives of general interest pursued by the Community and that they do not constitute a disproportionate and intolerable interference which infringes upon the very substance of the rights guaranteed.

Since the 1999 regime pursues, without altering, the general interest objectives of Regulation No 404/93 aforesaid, namely to integrate national markets and to provide an outlet for Community and ACP bananas, the change in economic conditions resulting from the entry into force of the common organisation of the market in bananas, which the applicant relies upon, does not support the conclusion that there has been an intolerable interference with the latter’s rights which are incompatible with the aforesaid objectives of general interest.

(see paras 220-221)

6. Given the broad discretion which the Community legislature has in matters concerning the common agricultural policy, the lawfulness of a measure adopted in that sphere can be affected only if the measure is manifestly inappropriate having regard to the objective which the competent institution is seeking to pursue. That limitation on judicial review is particularly necessary if, in establishing a common organisation of the market, the Council and the Commission are required to reconcile divergent interests and thus to select options within the context of the policy choices which are their own.

In this case, since the Commission sought, when adopting Regulation No 2362/98 laying down detailed rules for the implementation of Regulation No 404/93 regarding imports of bananas into the Community, to reconcile the objectives inherent in the common organisation of the market in bananas with compliance with the Community’s international commitments under the WTO Agreements and the Lomé Convention, while at the same time acceding to the wish of the Council to see the management of tariff quotas carried out by applying the method based on taking account of traditional trade flows, it is for the applicant to demonstrate that the provisions of Regulation No 2362/98 governing the distribution of import certificates and the allocation of national tariff sub-quotas are manifestly inappropriate to attaining the objective sought and that they exceed what is necessary in order to attain it, which it has not done.

(see paras 228-230)

7. The right to rely on the principle of the protection of legitimate expectations is open to any economic operator to whom an institution has given justified hopes.

In that regard, first, since the applicant was not a party to the disputes between the Community and its trading partners concerning the 1993 and 1999 regimes, the exchanges which took place between the latter could not have given rise to such hopes.

Second, by reason of the complexity of the provisions set out in the WTO Agreements and the imprecise nature of some of the concepts to which they refer, the principle codified in Article 26 of the Vienna Convention that international agreements are to be performed in good faith implies, on the part of the Community, a reasonable effort to adopt measures complying with those Agreements, while leaving the Community with a choice as to the form, and as to the means of attaining that objective. Given the margin of discretion which Community institutions have when choosing the necessary means for implementing their policy and giving effect to their international commitments, the applicant had no grounds for placing its legitimate expectations in an alteration of the 1993 regime that would meet its interests.

(see paras 255-256)