Judgment of the Court of 21 February 1984. - Walzstahl-Vereinigung and Thyssen Aktiengesellschaft v Commission of the European Communities. - ECSC - System of production quotas for steel - Reduction of abatement rates for "single-product" undertakings. - Joined cases 140 and 221/82 and 146 and 226/82.



European Court reports 1984 Page 00951

Spanish special edition Page 00329



Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

1 . ACTION FOR ANNULMENT - ACTION BROUGHT BY AN ASSOCIATION OF UNDERTAKINGS AGAINST GENERAL ECSC DECISIONS - INTEREST IN BRINGING PROCEEDINGS - CONDITIONS

( ECSC TREATY , ART . 33 , SECOND PARA ., AND ART . 48 )

2 . OBJECTION OF ILLEGALITY - MEASURES AGAINST WHICH AN OBJECTION OF ILLEGALITY MAY BE RAISED - PROVISIONS OF GENERAL ECSC DECISIONS - PROVISIONS FORMING THE BASIS OF THE CONTESTED INDIVIDUAL DECISION

( ECSC TREATY , ART . 36 , THIRD PARA .)

3 . ECSC - INSTITUTIONS - COMMISSION - POWERS - LIMITS

( ECSC TREATY , ART . 8 ; TITLE III )

4 . ECSC - PRODUCTION - SYSTEM OF STEEL PRODUCTION QUOTAS - APPLICATION TO ALL UNDERTAKINGS OF UNIFORM ABATEMENT RATES - GENERAL INCREASE OF QUOTAS FOR A GROUP OF UNDERTAKINGS - PROCEDURE TO BE FOLLOWED

( ECSC TREATY , ART . 58 ; DECISIONS NOS 2794/80 , 1831/81 , 533/82 , 1696/82 AND 1698/82 )

Summary

1 . WHERE AN ACTION FOR A DECLARATION THAT GENERAL ECSC DECISIONS ARE VOID IS BROUGHT BY AN ASSOCIATION OF UNDERTAKINGS MEETING THE CONDITIONS LAID DOWN BY THE SECOND PARAGRAPH OF ARTICLE 33 AND ARTICLE 48 OF THE ECSC TREATY , THAT ASSOCIATION ' S INTEREST IN BRINGING PROCEEDINGS MUST BE ACCEPTED IF IT HAS ALLEGED A MISUSE OF POWERS AFFECTING ONE OR MORE OF ITS MEMBERS AND ADDUCES RELEVANT ARGUMENTS TO SUBSTANTIATE THE ALLEGED MISUSE OF POWERS .

2.ALTHOUGH IN AN ACTION FOR A DECLARATION THAT AN INDIVIDUAL DECISION IS VOID THE APPLICANT UNDERTAKING MAY ALLEGE THAT CERTAIN PROVISIONS OF THE GENERAL DECISIONS WHICH THE CONTESTED DECISION IMPLEMENTS ARE ILLEGAL , IT MAY DO SO ONLY IF THE INDIVIDUAL DECISION IS BASED ON THE RULES ALLEGED TO BE ILLEGAL .

3.THE POWERS CONFERRED ON THE COMMISSION BY THE ECSC TREATY ARE LIMITED BY THE SPECIFIC PROVISIONS SET OUT IN TITLE III OF THE TREATY . SUCH POWERS WOULD BE DIVERTED FROM THEIR LAWFUL PURPOSE IF IT APPEARED THAT THE COMMISSION HAD MADE USE OF THEM WITH THE EXCLUSIVE , OR AT ANY RATE THE MAIN , PURPOSE OF EVADING A PROCEDURE SPECIFICALLY PRESCRIBED BY THE TREATY FOR DEALING WITH THE CIRCUMSTANCES WITH WHICH IT IS REQUIRED TO COPE .

4.SINCE THE QUOTA SYSTEM INTRODUCED BY DECISIONS NO 2794/80 , NO 1831/81 AND NO 1696/82 WAS BASED ON THE APPLICATION TO ALL UNDERTAKINGS OF UNIFORM ABATEMENT RATES FOR EACH CATEGORY OF PRODUCTS SUBJECT TO IT - UNLESS THE INDIVIDUAL SITUATION OF THE UNDERTAKING IN QUESTION JUSTIFIED AN EXCEPTION , THE COMMISSION MAY DECIDE UPON A GENERAL INCREASE OF THE QUOTAS FOR A WHOLE GROUP OF UNDERTAKINGS CHARACTERIZED BY THEIR STRUCTURE ONLY AFTER FOLLOWING THE PROCEDURE LAID DOWN IN ARTICLE 58 OF THE TREATY , THAT IS TO SAY AFTER CONSULTING THE CONSULTATIVE COMMITTEE AND OBTAINING THE ASSENT OF THE COUNCIL .

Parties

IN JOINED CASES 140 , 146 , 221 AND 226/82

140 AND 221/82 , WALZSTAHL-VEREINIGUNG , DUSSELDORF , REPRESENTED BY ITS MANAGING DIRECTOR , G . REMY , ASSISTED BY MESSRS DERINGER , TESSIN , HERRMANN AND SEDEMUND , RECHTSANWALTE , COLOGNE , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF J . LOESCH , 2 RUE GOETHE ,

AND

146 AND 226/82 , THYSSEN AKTIENGESELLSCHAFT , DUISBURG , REPRESENTED BY ITS BOARD OF DIRECTORS COMPOSED OF MESSRS SPETHMANN , BARTELS , DEHMER , DOESE , EWERS , GLATZEL , HILTROP , KRIWET , STEIN AND ZIMMERMANN , ASSISTED BY MESSRS DERINGER , TESSIN , HERRMANN AND SEDEMUND , RECHTSANWALTE , COLOGNE , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF J . LOESCH , 2 RUE GOETHE ,

APPLICANTS ,

V

COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY ITS LEGAL ADVISERS , H . MATTHIES AND R . WAGENBAUR , ASSISTED BY PROFESSOR E . GRABITZ OF THE FREE UNIVERSITY OF BERLIN , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF ORESTE MONTALTO , A MEMBER OF ITS LEGAL DEPARTMENT , JEAN MONNET BUILDING , KIRCHBERG ,

DEFENDANT ,

Subject of the case

APPLICATIONS FOR DECLARATIONS THAT COMMISSION DECISIONS NO 533/82/ECSC OF 3 MARCH 1982 ( OFFICIAL JOURNAL 1982 , L 65 , P . 6 ) AND NO 1698/82/ECSC OF 30 JUNE 1982 ( OFFICIAL JOURNAL 1982 , L 191 , P . 43 ) ARE VOID AND THAT THE COMMISSION ' S COMMUNICATIONS INFORMING THYSSEN AKTIENGESELLSCHAFT OF ITS REFERENCE PRODUCTION AND PRODUCTION QUOTAS FOR THE SECOND AND THIRD QUARTERS OF 1982 ARE VOID IN SO FAR AS THEY CONCERN THE ABATEMENT RATES FOR CONCRETE REINFORCING BARS ,

Grounds

1 BY APPLICATIONS LODGED AT THE COURT REGISTRY ON 30 APRIL AND 23 AUGUST 1982 THE WALZSTAHL-VEREINIGUNG , DUSSELDORF , BROUGHT TWO ACTIONS UNDER THE SECOND PARAGRAPH OF ARTICLE 33 OF THE ECSC TREATY , REQUESTING THE COURT TO DECLARE VOID COMMISSION DECISION NO 533/82/ECSC OF 3 MARCH 1982 AMENDING FOR THE THIRD TIME DECISION NO 1831/81/ECSC ESTABLISHING FOR UNDERTAKINGS IN THE IRON AND STEEL INDUSTRY A MONITORING SYSTEM AND A NEW SYSTEM OF PRODUCTION QUOTAS IN RESPECT OF CERTAIN PRODUCTS ( OFFICIAL JOURNAL 1982 , L 65 , P . 6 ) AND COMMISSION DECISION NO 1698/82/ECSC OF 30 JUNE 1982 ADJUSTING THE ABATEMENT RATES FOR CATEGORY V PRODUCTS FOR THE THIRD QUARTER OF 1982 IN RESPECT OF CERTAIN UNDERTAKINGS ( OFFICIAL JOURNAL 1982 , L 191 , P . 43 ).

2 BY APPLICATIONS LODGED ON 11 MAY AND 31 AUGUST 1982 THYSSEN AKTIENGESELLSCHAFT , DUISBURG , BROUGHT TWO ACTIONS UNDER THE SAME PROVISION FOR A DECLARATION THAT THE COMMISSION ' S INDIVIDUAL DECISIONS ADDRESSED TO IT ON 30 MARCH AND 20 JULY 1982 , CONCERNING THE REFERENCE-PRODUCTION FIGURES AND PRODUCTION QUOTAS FOR THE SECOND AND THIRD QUARTERS OF 1982 , ARE VOID IN SO FAR AS THEY CONCERN THE ABATEMENT RATES FOR CATEGORY V . THESE TWO ACTIONS ARE BASED ESSENTIALLY ON THE ALLEGED ILLEGALITY OF DECISIONS NO 533/82 AND NO 1698/82 .

3 BY ORDER OF 23 MARCH 1983 THE COURT DECIDED , IN VIEW OF THE RELATED NATURE OF THE FOUR CASES , TO JOIN THEM FOR THE PURPOSES OF THE ORAL PROCEDURE AND JUDGMENT .

4 BEFORE THE APPLICATIONS ARE EXAMINED THE GENERAL DECISIONS AT ISSUE SHOULD BE PUT INTO THEIR CONTEXT .

5 BY DECISION NO 2794/80/ECSC OF 31 OCTOBER 1980 ( OFFICIAL JOURNAL 1980 , L 291 , P . 1 ) THE COMMISSION , FACED WITH A MANIFEST CRISIS ON THE STEEL MARKET , INTRODUCED A SYSTEM OF QUARTERLY PRODUCTION QUOTAS FOR STEEL UNDERTAKINGS IN THE COMMUNITY , PURSUANT TO ARTICLE 58 OF THE ECSC TREATY . UNDER THAT SYSTEM AN ABATEMENT RATE , WHICH IS THE SAME FOR ALL UNDERTAKINGS , IS APPLIED TO EACH UNDERTAKING ' S ACTUAL PRODUCTION DURING A REFERENCE PERIOD IN RESPECT OF EACH PRODUCT CATEGORY COVERED BY THE SYSTEM . ABATEMENT RATES ARE ALSO APPLIED TO THE PROPORTION OF PRODUCTION WHICH MAY BE DELIVERED WITHIN THE COMMON MARKET . HOWEVER , THE DECISION MADE PROVISION FOR CERTAIN EXCEPTIONS TO THE SYSTEM OF UNIFORM ABATEMENT RATES . THUS , REFERENCE PRODUCTION WAS INCREASED FOR UNDERTAKINGS WHICH , OWING IN PARTICULAR TO MEASURES WHICH THEY HAD ADOPTED IN CONFORMITY WITH THE COMMUNITY ' S STEEL POLICY FOUND THEMSELVES IN PARTICULAR SITUATIONS . FURTHERMORE , ARTICLE 14 OF THE DECISION EMPOWERED THE COMMISSION TO ADAPT THE PROVISIONS AT THE REQUEST OF AN UNDERTAKING FOR WHICH THE PRODUCTION OR DELIVERY RESTRICTIONS IMPOSED BY THE DECISION OR BY MEASURES IMPLEMENTING IT ENTAILED EXCEPTIONAL DIFFICULTIES .

6 WHEN THE PERIOD OF APPLICATION OF THE SYSTEM INTRODUCED BY DECISION NO 2794/80 EXPIRED ON 30 JUNE 1981 THE COMMISSION ADOPTED DECISION NO 1831/81/ECSC OF 24 JUNE 1981 ESTABLISHING FOR UNDERTAKINGS IN THE IRON AND STEEL INDUSTRY A MONITORING SYSTEM AND A NEW SYSTEM OF PRODUCTION QUOTAS IN RESPECT OF CERTAIN PRODUCTS ( OFFICIAL JOURNAL 1981 , L 180 , P . 1 ). WHEREAS IN DECISION NO 2794/80 ALL LIGHT SECTIONS ( WIRE ROD , CONCRETE REINFORCING BARS AND MERCHANT BARS ) WERE CLASSIFIED IN GROUP IV , WHICH WAS SUBJECT TO THE QUOTA SYSTEM , IN DECISION NO 1831/81 THEY WERE DIVIDED INTO THREE GROUPS - NAMELY GROUP IV ( WIRE ROD ), GROUP V ( CONCRETE REINFORCING BARS ) AND GROUP VI ( MERCHANT BARS ) - WHICH WERE NOT SUBJECT TO THE NEW QUOTA SYSTEM BUT TO A MONITORING SYSTEM . HOWEVER , A FEW DAYS LATER , ON 3 JULY 1981 , THE COMMISSION , BY DECISION NO 1832/81/ECSC ( OFFICIAL JOURNAL 1981 , L 184 , P . 1 ) RE-INCLUDED CONCRETE REINFORCING BARS AND MERCHANT BARS IN THE QUOTA SYSTEM .

7 LIKE DECISION NO 2794/80 , DECISION NO 1831/81 TEMPERED THE RIGIDITY OF THE SYSTEM OF UNIFORM ABATEMENT RATES BY PROVIDING FOR AN INCREASE IN THE REFERENCE PRODUCTION OF UNDERTAKINGS IN SPECIFIC SITUATIONS AND BY EMPOWERING THE COMMISSION , IN ARTICLE 14 , TO MAKE ADJUSTMENTS AT THE REQUEST OF AN UNDERTAKING FOR WHICH THE SCALE OF THE ABATEMENT RATES IMPOSED IN RESPECT OF A QUARTER CREATED EXCEPTIONAL DIFFICULTIES . HOWEVER , DECISION NO 1832/81 , WHICH RE-INCLUDED CONCRETE REINFORCING BARS AND MERCHANT BARS IN THE QUOTA SYSTEM , LIMITED THE RIGHT TO INVOKE ARTICLE 14 WITH REGARD TO THOSE PRODUCTS TO CASES IN WHICH THE TOTAL REFERENCE PRODUCTION FOR CATEGORIES V AND VI WAS LESS THAN 60 000 TONNES A YEAR .

8 ON THE OTHER HAND , ARTICLE 16 ( 1 ) OF DECISION NO 1831/81 CONFERRED A NEW POWER ON THE COMMISSION BY PROVIDING THAT :

' ' IF RADICAL CHANGES OCCUR IN THE IRON AND STEEL MARKET OR IF THE APPLICATION OF THIS DECISION ENCOUNTERS ANY UNFORESEEN DIFFICULTIES , THE COMMISSION SHALL CARRY OUT THE NECESSARY ADJUSTMENTS BY GENERAL DECISION . ' '

9 IN THE FIRST OF THE CONTESTED GENERAL DECISIONS , DECISION NO 533/82 OF 3 MARCH 1982 , THE COMMISSION , ACTING PURSUANT TO ARTICLE 16 ( 1 ) OF DECISION NO 1831/81 , MADE PROVISION FOR AN EXCEPTION TO THE UNIFORM ABATEMENT RATES FOR THE SECOND QUARTER OF 1982 , AS FIXED BY DECISION NO 532/82 OF THE SAME DATE ( OFFICIAL JOURNAL 1982 , L 65 , P . 5 ). THIS EXCEPTIONAL PROVISION IS WORDED AS FOLLOWS :

' ' FOR PRODUCERS WHOSE TOTAL PRODUCTION OF THE PRODUCTS ( SUBJECT TO THE QUOTAS ) DID NOT EXCEED 700 000 TONNES IN 1981 AND WHOSE PRODUCTION OF CATEGORIES IV , V AND VI ACCOUNTS FOR AT LEAST 90% OF THEIR TOTAL PRODUCTION , THE ABATEMENT RATES IN RESPECT OF CATEGORY V FOR THE PURPOSE OF ESTABLISHING PRODUCTION QUOTAS AND THE PROPORTION OF THE PRODUCTION QUOTAS THAT MAY BE DELIVERED TO THE COMMON MARKET LAID DOWN IN DECISION NO 532/82/ECSC FOR THE SECOND QUARTER OF 1982 SHALL BE REDUCED BY FIVE PERCENTAGE POINTS IF PRODUCTION OF CATEGORY V REPRESENTS AT LEAST 30% OF PRODUCTION OF CATEGORIES IV , V AND VI IN 1981 . ' '

10 IN THE PREAMBLE TO DECISION NO 533/82 THE REASONS FOR THAT PROVISION ARE STATED AS FOLLOWS :

' ' . . .

2 . IN THE CASE OF CONCRETE REINFORCING BARS , WHICH BELONG TO CATEGORY V OF THE NEW SYSTEM OF QUOTAS , THE DOWNTURN IN DEMAND , WHICH HAS CONTINUED AND BECOME MORE MARKED DURING THE LAST TWO QUARTERS AS A RESULT OF THE WORSENING OF THE SLUMP IN THE CONSTRUCTION SECTOR , TOGETHER WITH THE HIGH LEVEL OF STOCKS , HAS REQUIRED VERY HIGH ABATEMENT RATES TO BE GRANTED . THIS REDUCTION IN DEMAND HAS BEEN REFLECTED DURING THE LAST FEW WEEKS BY A SLUMP IN MARKET PRICES , WHICH IN CERTAIN REGIONS OF THE COMMUNITY HAVE FALLEN WELL BELOW THE LEVEL CORRESPONDING TO THE COMMISSION ' S GUIDANCE PRICES ; THIS REDUCTION IN DEMAND IS ALSO AFFECTING , ALTHOUGH LESS SEVERELY , PRODUCTS IN CATEGORIES IV ( WIRE ROD ) AND VI ( MERCHANT BARS ), WHICH ARE MARKETED IN THE SAME SECTORS AND OFTEN PRODUCED BY THE SAME UNDERTAKINGS .

3.THERE ARE IN THE COMMUNITY A SUBSTANTIAL NUMBER OF SMALL AND MEDIUM-SIZED UNDERTAKINGS WHOSE PRODUCTION DEPENDS ALMOST EXCLUSIVELY ON PRODUCTS IN CATEGORIES IV , V AND VI AND TO A CONSIDERABLE EXTENT ON THE PRODUCTION OF CONCRETE REINFORCING BARS ; SUCH UNDERTAKINGS ARE CLEARLY DIFFERENT BOTH FROM UNDERTAKINGS THAT ALSO PRODUCE SEVERAL OTHER CATEGORIES OF PRODUCTS AND CAN CONSEQUENTLY BENEFIT FROM THE MORE FAVOURABLE MARKET CONDITIONS FOR THEIR OTHER PRODUCTS AND FROM UNDERTAKINGS THAT PRODUCE OTHER CATEGORIES OF PRODUCTS ONLY .

4.BY DECISION NO 1831/81/ECSC , THE COMMISSION RECOGNIZED THAT THE SYSTEM OF QUOTAS COULD CREATE EXCEPTIONAL DIFFICULTIES FOR CERTAIN UNDERTAKINGS ' BOTH BECAUSE OF THE SIZE OF THEIR PLANTS AND BECAUSE OF THEIR DEPENDENCE ON A LIMITED RANGE OF PRODUCTS ' AND INCLUDED ARTICLE 14 IN THAT DECISION IN ORDER TO BE ABLE TO ADJUST THE REFERENCE PRODUCTIONS OF SUCH UNDERTAKINGS SHOULD THE ABATEMENT RATE EXCEED A CERTAIN LEVEL .

IN VIEW OF THE EXTREMELY HIGH ABATEMENT RATE IN RESPECT OF CONCRETE REINFORCING BARS FOR THE SECOND QUARTER OF 1982 , THE SYSTEM OF QUOTAS WILL CLEARLY CREATE EXCEPTIONAL DIFFICULTIES FOR THE UNDERTAKINGS REFERRED TO IN POINT 3 ABOVE . LESS STRINGENT QUOTAS SHOULD THEREFORE NOW BE ESTABLISHED FOR THESE UNDERTAKINGS .

5.SINCE POINT 3 ABOVE CONCERNS A LARGE NUMBER OF UNDERTAKINGS , IT SHOULD BE STIPULATED THAT FOR THESE PRODUCERS A REDUCTION IN THE ABATEMENT RATES FOR THE ESTABLISHMENT OF QUOTAS WILL BE MADE BY GENERAL DECISION .

6.THE WORSENING OF THE SLUMP IN THE CONSTRUCTION SECTOR AND THE INCREASED DOWNTURN IN DEMAND AND PRICES FOR CONCRETE REINFORCING BARS CONSTITUTE A RADICAL CHANGE IN THE IRON AND STEEL MARKET WITHIN THE MEANING OF ARTICLE 16 ( 1 ) OF DECISION NO 1831/81/ECSC . ' '

11 WHEN THE PERIOD OF APPLICATION OF THE QUOTA SYSTEM PROVIDED FOR IN DECISION NO 1831/81 EXPIRED , THE COMMISSION ADOPTED DECISION NO 1696/82 OF 30 JUNE 1982 ON THE EXTENSION OF THE SYSTEM OF MONITORING AND PRODUCTION QUOTAS FOR CERTAIN PRODUCTS OF UNDERTAKINGS IN THE STEEL INDUSTRY ( OFFICIAL JOURNAL 1982 , L 191 , P . 1 ). THAT DECISION , WHICH MADE THE THREE CATEGORIES OF LIGHT SECTIONS ( WIRE ROD , CONCRETE REINFORCING BARS AND MERCHANT BARS ) SUBJECT TO THE QUOTA SYSTEM , MAINTAINED THE EXCEPTIONS TO THE SYSTEM OF UNIFORM ABATEMENT RATES AND THE CONDITIONS GOVERNING THE COMMISSION ' S EXERCISE OF ITS POWER TO MAKE ADJUSTMENTS UNDER ARTICLE 14 ; HOWEVER , THE LEVEL OF PRODUCTION ABOVE WHICH SPECIAL RELIEF MAY NOT BE GRANTED WAS RAISED FROM 60 000 TO 100 000 TONNES . FINALLY , ARTICLE 18 ( 1 ) OF DECISION NO 1696/82 CONTAINS AN ENABLING PROVISION WORDED IN THE SAME WAY AS ARTICLE 16 ( 1 ) OF DECISION NO 1831/81 .

12 PURSUANT TO THAT PROVISION THE COMMISSION ADOPTED , AT THE SAME DATE AS DECISION NO 1696/82 , THE SECOND GENERAL DECISION AT ISSUE , NAMELY DECISION NO 1698/82 . THAT DECISION PROVIDES FOR AN EXCEPTION TO THE UNIFORM ABATEMENT RATES FIXED FOR THE THIRD QUARTER OF 1982 BY DECISION NO 1697/82 OF THE SAME DATE ( OFFICIAL JOURNAL 1982 , L 191 , P . 42 ). THE EXCEPTION IS FRAMED IS THE SAME TERMS AS IN DECISION NO 533/82 . HOWEVER , IT IS FURTHER PROVIDED THAT NO UNDERTAKING IN RESPECT OF WHICH AN ADJUSTMENT PURSUANT TO ARTICLE 14 OF DECISION NO 1698/82 IS MADE FOR THAT QUARTER IS TO BE ENTITLED TO THE REDUCTION OF ABATEMENT RATES PROVIDED FOR IN DECISION NO 1698/82 . IN THE PREAMBLE TO THE DECISION IT WAS STRESSED THAT THE SITUATION CONCERNING REINFORCING BARS HAD WORSENED , NECESSITATING THE SETTING OF ABATEMENT RATES FOR THE THIRD QUARTER WHICH WERE EVEN HIGHER THAN THOSE FOR THE SECOND QUARTER . THE PREAMBLE THEN GOES ON TO STATE THAT :

' ' . . .

3 . IN RESPECT OF THE SECOND QUARTER OF 1982 , THE COMMISSION HAD ALREADY HAD TO CONCLUDE THAT THE APPLICATION OF HIGH ABATEMENT RATES WOULD CREATE EXCEPTIONAL DIFFICULTIES FOR CERTAIN SMALL AND MEDIUM-SIZED UNDERTAKINGS WHOSE PRODUCTION DEPENDS ALMOST EXCLUSIVELY ON PRODUCTS IN CATEGORIES IV , V AND VI AND TO A CONSIDERABLE EXTENT ON THE PRODUCTION OF REINFORCING BARS . CONSEQUENTLY , IN DECISION NO 533/82/ECSC OF 3 MARCH 1982 , THE COMMISSION DECIDED TO REDUCE THE ABATEMENT RATES FOR SUCH UNDERTAKINGS BY FIVE PERCENTAGE POINTS , AS THE UNDERTAKINGS IN QUESTION DID NOT MEET ALL THE CRITERIA SET OUT IN ARTICLE 14 OF DECISION NO 1831/81/ECSC , AS AMENDED BY DECISION NO 1832/81/ECSC .

. . .

5 . THE WORSENING OF THE SITUATION ON THE MARKET FOR REINFORCING BARS AND THE RESULTING NEED TO SET EXCEPTIONALLY HIGH RATES FOR THIS PRODUCT CONSTITUTES A RADICAL CHANGE ON THIS MARKET AND HAS CREATED DIFFICULTIES IN THE APPLICATION OF THE QUOTA SYSTEM WHICH ARE ONLY PARTIALLY PROVIDED FOR IN ARTICLE 14 OF DECISION NO 1696/82/ECSC . PURSUANT TO ARTICLE 18 ( 1 ) OF THAT DECISION , THE DECISION SHOULD THEREFORE BE ADJUSTED IN RESPECT OF THE THIRD QUARTER OF 1982 . ' '

13 FOR THE FOURTH QUARTER OF 1982 , IN WHICH THE ABATEMENT RATE FOR CONCRETE REINFORCING BARS REMAINED THE SAME AS IN THE THIRD QUARTER , THE COMMISSION CEASED TO PROVIDE FOR A GENERAL EXCEPTION FOR THE UNDERTAKINGS AFFECTED BY THE TWO DECISIONS AT ISSUE . HOWEVER , IT ALTERED THE LIMITS LAID DOWN IN ARTICLE 14 OF DECISION NO 1696/82 SO THAT IT COULD MAKE ADJUSTMENTS FOR THOSE UNDERTAKINGS , UPON REQUEST AND AFTER CONSIDERATION OF EACH INDIVIDUAL CASE .

14 IN VIEW OF THE SPECIFIC CRITERIA LAID DOWN IN DECISIONS NO 533/82 AND NO 1698/82 , IT IS NOT DISPUTED THAT THEY WERE MEANT TO APPLY ONLY TO ' ' SINGLE-PRODUCT ' ' UNDERTAKINGS . THE PRODUCTION OF THOSE UNDERTAKINGS CONSISTS ALMOST ENTIRELY OF PRODUCTS IN CATEGORIES IV , V AND VI , WHICH THEY USUALLY MANUFACTURE FROM SCRAP USING A TECHNIQUE WITH WHICH IT IS NOT POSSIBLE TO MANUFACTURE OTHER STEEL PRODUCTS . DECISIONS NO 533/82 AND NO 1698/82 DO NOT APPLY TO ' ' INTEGRATED ' ' UNDERTAKINGS , SUCH AS THYSSEN AG AND THE UNDERTAKINGS AFFILIATED TO THE WALZSTAHL-VEREINIGUNG . THE INTEGRATED UNDERTAKINGS DIFFER FROM THE SINGLE-PRODUCT UNDERTAKINGS MAINLY IN SO FAR AS THEY PRODUCE A WIDE RANGE OF PRODUCTS AND CONCRETE REINFORCING BARS FORM ONLY A VERY LIMITED PROPORTION OF THEIR PRODUCTION . THEY NORMALLY USE A DIFFERENT , MORE COSTLY PRODUCTION TECHNIQUE . HOWEVER , FOR THE MANUFACTURE OF CONCRETE REINFORCING BARS , SOME OF THEM , SUCH AS THYSSEN AG , USE A TECHNIQUE SIMILAR TO THAT USED BY THE SINGLE-PRODUCT UNDERTAKINGS .

15 THE APPLICANTS CONTEND INTER ALIA THAT NEITHER ARTICLE 58 OF THE ECSC TREATY NOR ARTICLES 14 AND 16 OF DECISION NO 1831/81 NOR ARTICLES 14 AND 18 OF DECISION NO 1696/82 PROVIDE A LEGAL BASIS FOR THE GENERAL DECISIONS AT ISSUE . THEY CONTEND THAT ON THE GROUND OF THE ALLEGED EXCEPTIONAL DIFFICULTIES OF THE SINGLE-PRODUCT UNDERTAKINGS THE COMMISSION ABUSED ITS POWER UNDER ARTICLE 16 OF DECISION NO 1831/81 AND ARTICLE 18 OF DECISION NO 1696/82 IN ORDER TO GIVE A COMPETITIVE ADVANTAGE TO A WHOLE GROUP OF UNDERTAKINGS HOLDING 70% OF THE COMMUNITY MARKET IN CONCRETE REINFORCING BARS WITHOUT EXAMINING EACH INDIVIDUAL CASE , AS REQUIRED BY ARTICLE 14 OF THOSE DECISIONS ; MOREOVER , IT DID SO WITHOUT EVEN CONSULTING THE CONSULTATIVE COMMITTEE OR OBTAINING THE ASSENT OF THE COUNCIL , AS REQUIRED BY ARTICLE 58 OF THE ECSC TREATY . THE APPLICANTS SUBMIT THAT IN SO DOING THE COMMISSION NOT ONLY ACTED IN BREACH OF THE PROHIBITION OF DISCRIMINATION AND THE BASIC PRINCIPLE THAT THE QUOTA SYSTEM SHOULD HAVE A NEUTRAL EFFECT ON COMPETITION , BUT ALSO DISREGARDED FUNDAMENTAL AIMS OF THE TREATY AND COMMITTED A MISUSE OF POWERS AS AGAINST THE APPLICANTS .

ADMISSIBILITY

16 THE COMMISSION HAS EXPRESSED DOUBTS ABOUT THE ADMISSIBILITY OF THE ACTIONS , WHICH ARE ALL BASED ON THE SECOND PARAGRAPH OF ARTICLE 33 OF THE EEC TREATY . THAT PROVISION STATES THAT UNDERTAKINGS OR THE ASSOCIATIONS REFERRED TO IN ARTICLE 48 MAY INSTITUTE PROCEEDINGS AGAINST DECISIONS CONCERNING THEM WHICH ARE INDIVIDUAL IN CHARACTER OR AGAINST GENERAL DECISIONS WHICH THEY CONSIDER TO INVOLVE A MISUSE OF POWERS AFFECTING THEM .

17 AS REGARDS THE ACTIONS BROUGHT BY THE WALZSTAHL-VEREINIGUNG , WHICH ARE DIRECTED AGAINST DECISIONS NO 533/82 AND NO 1698/82 , THE COMMISSION CALLS IN QUESTION THAT ASSOCIATION ' S INTEREST IN BRINGING PROCEEDINGS . IT POINTS OUT THAT ONLY SIX OF THE THIRTEEN MEMBER UNDERTAKINGS SUBJECT TO THE QUOTA SYSTEM MANUFACTURE CONCRETE REINFORCING BARS , WHICH ACCOUNT FOR NO MORE THAN 3% OF THE TOTAL PRODUCTION OF ALL 13 MEMBERS . FURTHERMORE , 40% OF ALL CONCRETE REINFORCING BARS PRODUCED IN THE FEDERAL REPUBLIC OF GERMANY ARE MADE BY UNDERTAKINGS WHICH ARE NOT AFFILIATED TO THE APPLICANT ASSOCIATION . FROM THOSE FACTS THE COMMISSION CONCLUDES THAT THE EFFECTS OF THE CONTESTED GENERAL DECISIONS ON THE WALZSTAHL-VEREINIGUNG ARE EXTREMELY SLIGHT .

18 IN THIS REGARD IT SHOULD BE RECALLED THAT THE COURT HAS CONSISTENTLY HELD THAT IN ORDER TO ESTABLISH AN APPLICANT ' S INTEREST IN BRINGING PROCEEDINGS IT NEED ONLY BE SHOWN THAT IT IS AN ASSOCIATION OF UNDERTAKINGS MEETING THE CONDITIONS LAID DOWN BY THE SECOND PARAGRAPH OF ARTICLE 33 AND ARTICLE 48 OF THE ECSC TREATY AND THAT IT ALLEGES A MISUSE OF POWERS AFFECTING ONE OR MORE OF ITS MEMBERS AND ADDUCES RELEVANT ARGUMENTS TO SUBSTANTIATE THE ALLEGED MISUSE OF POWERS . THE COMMISSION HAS NOT DISPUTED THAT THOSE CONDITIONS ARE FULFILLED IN THE PRESENT CASES . ON THE OTHER HAND , AS THE COMMISSION HAS RIGHTLY POINTED OUT , THE ACTIONS BROUGHT BY THE WALZSTAHL-VEREINIGUNG CANNOT LEAD TO THE ANNULMENT OF THE TWO DECISIONS AT ISSUE UNLESS THE EXISTENCE OF SUCH A MISUSE OF POWERS IS ACTUALLY PROVED . THAT QUESTION , HOWEVER , GOES TO THE SUBSTANCE OF THE CASES .

19 AS REGARDS THE ACTIONS BROUGHT BY THYSSEN AG , THE COMMISSION POINTS OUT THAT THAT UNDERTAKING HAS REQUESTED THE COURT TO DECLARE THE INDIVIDUAL DECISIONS RELATING TO ITS PRODUCTION QUOTAS FOR THE SECOND AND THIRD QUARTERS OF 1982 VOID IN SO FAR AS THEY CONCERN THE ABATEMENT RATES FOR CONCRETE REINFORCING BARS . AS THOSE RATES ARE BASED ON DECISIONS NO 532/81 AND NO 1697/82 AND THE APPLICANT ' S SUBMISSIONS ARE ESSENTIALLY DIRECTED AGAINST DECISIONS NO 533/82 AND NO 1698/82 , IT IS ARGUED THAT THOSE ACTIONS ARE , AT LEAST PARTLY , INADMISSIBLE .

20 THE COURT HELD IN ITS JUDGMENT OF 28 OCTOBER 1981 IN JOINED CASES 275/80 AND 24/81 ( KRUPP STAHL AG V COMMISSION ( 1981 ) ECR 2489 ) THAT , ALTHOUGH IN AN ACTION FOR A DECLARATION THAT AN INDIVIDUAL DECISION IS VOID THE APPLICANT UNDERTAKING MAY ALLEGE THAT CERTAIN PROVISIONS OF THE GENERAL DECISIONS WHICH THE CONTESTED DECISION IMPLEMENTS ARE ILLEGAL , IT MAY DO SO ONLY IF THE INDIVIDUAL DECISION IS BASED ON THE RULES ALLEGED TO BE ILLEGAL . IN THIS CASE IT CANNOT BE DISPUTED THAT THERE IS A CLOSE RELATIONSHIP BETWEEN THE DECISIONS FIXING THE ABATEMENT RATES FOR CONCRETE REINFORCING BARS INTER ALIA AND THE DECISIONS REDUCING THOSE RATES FOR CERTAIN PRODUCERS OF CONCRETE REINFORCING BARS . THE LATTER DECISIONS EXPRESSLY REFER TO THE FORMER DECISIONS AND WERE ADOPTED ON THE SAME DATES . MOREOVER , SINCE THE PURPOSE OF THE ABATEMENT RATES IS TO ESTABLISH A BALANCE BETWEEN PRODUCTION AND EXPECTED DEMAND , IT SEEMS THAT THE GENERAL ABATEMENT RATE FOR THE PRODUCTS CONCERNED WOULD HAVE BEEN LOWER IF THERE HAD BEEN NO REDUCTION IN THE ABATEMENT RATE FOR PRODUCERS HOLDING 70% OF THE RELEVANT MARKET . THE INDIVIDUAL DECISIONS WHICH THE APPLICANT SEEKS TO HAVE DECLARED VOID ARE THEREFORE PARTLY BASED ON THE GENERAL DECISIONS AT ISSUE .

21 CONSEQUENTLY , THE FOUR ACTIONS ARE ADMISSIBLE .

SUBSTANCE

22 AS EXPLAINED IN PARAGRAPH 15 , THE APPLICANTS CHARGE THE COMMISSION WITH HAVING COMMITTED A MISUSE OF POWERS AS AGAINST THEM BY GIVING ALL SINGLE-PRODUCT UNDERTAKINGS A COMPETITIVE ADVANTAGE ON THE MARKET IN CONCRETE REINFORCING BARS WITHOUT EXAMINING THE INDIVIDUAL SITUATION OF EACH OF THOSE UNDERTAKINGS , AS REQUIRED BY ARTICLE 14 OF THE BASIC DECISIONS THEN IN FORCE , AND WITHOUT AMENDING THOSE DECISIONS IN ACCORDANCE WITH THE PROCEDURE LAID DOWN IN ARTICLE 58 OF THE ECSC TRATY .

23 IN ITS DEFENCE THE COMMISSION MAINTAINS THAT IT HAD NO CHOICE BUT TO ADOPT THE CONTESTED GENERAL DECISIONS . IT REFERS TO THE DRAMATIC DECLINE IN DEMAND FOR CONCRETE REINFORCING BARS SINCE THE SUMMER OF 1981 DUE TO THE CONTINUING SLUMP IN THE BUILDING INDUSTRY . THAT MARKET DEVELOPMENT PRODUCED A SHARP FALL IN THE PRICE OF CONCRETE REINFORCING BARS AND MADE IT NECESSARY TO APPLY HIGH ABATEMENT RATES TO THAT PRODUCT , EXPECIALLY IN THE SECOND AND THIRD QUARTERS OF 1982 .

24 ACCORDING TO THE COMMISSION , THIS DEVELOPMENT AFFECTED MANUFACTURERS OF CONCRETE REINFORCING BARS IN DIFFERENT WAYS . AS FAR AS THE SINGLE-PRODUCT UNDERTAKINGS WERE CONCERNED , THE FALL IN PRICES NOT ONLY ERODED THEIR COST ADVANTAGE BUT ALSO LED THEM TO OPERATE AT A LOSS . THE INTEGRATED UNDERTAKINGS ' LOSSES ON REINFORCING BARS WERE EVEN GREATER THAN THOSE OF THE SINGLE-PRODUCT UNDERTAKINGS ; HOWEVER , THE BENEFIT WHICH THE INTEGRATED UNDERTAKINGS DERIVED , DURING THE SAME PERIOD , FROM THE RISE IN PRICES FOR FLAT PRODUCTS AFTER THE INTRODUCTION OF THE QUOTA SYSTEM WAS MAINTAINED . MOREOVER , THE ABATEMENT RATES FOR FLAT PRODUCTS WERE REDUCED , AT ANY RATE UNTIL THE SECOND QUARTER OF 1982 . THEREFORE , CONTRARY TO WHAT HAD HAPPENED IN THE CASE OF THE SINGLE-PRODUCT UNDERTAKINGS , THE LOSSES INCURRED BY THE INTEGRATED UNDERTAKINGS ON CONCRETE REINFORCING BARS WERE ACCOMPANIED BY AN INCREASE IN EARNINGS FROM OTHER , EVEN MORE IMPORTANT SECTORS .

25 IN THE COMMISSION ' S VIEW , THE DEVELOPMENTS DESCRIBED ABOVE THREATENED THE VERY EXISTENCE OF THE SINGLE-PRODUCT UNDERTAKINGS , WHICH WERE IN EXCEPTIONAL DIFFICULTIES WITHIN THE MEANING OF ARTICLE 14 OF DECISIONS NO 1831/81 AND NO 1696/82 . HOWEVER , IN ORDER TO MEET THAT IMMINENT DANGER THE COMMISSION COULD NOT APPLY THOSE PROVISIONS BECAUSE THEY COULD BE INVOKED ONLY BY SMALL SINGLE-PRODUCT UNDERTAKINGS , WHEREAS MEDIUM-SIZED SINGLE-PRODUCT UNDERTAKINGS WERE IN THE SAME CRITICAL SITUATION . FURTHERMORE , THE EXAMINATION OF INDIVIDUAL CASES REQUIRED BY THOSE PROVISIONS WAS UNNECESSARY SINCE ALL THE SINGLE-PRODUCT UNDERTAKINGS FACED THE SAME MARKET SITUATION . HOWEVER , THE COMMISSION CLAIMS THAT IN ARTICLE 16 OF DECISION NO 1831/81 AND ARTICLE 18 OF DECISION NO 1696/82 IT HAD THE LEGAL MEANS TO CARRY OUT THE NECESSARY ADJUSTMENTS BY GENERAL DECISIONS . IN ITS SUBMISSION , THE CONDITIONS FOR THE APPLICATION OF THOSE ARTICLES WERE FULFILLED SINCE THE DEVELOPMENTS ON THE MARKET IN CONCRETE REINFORCING BARS CONSTITUTED A RADICAL CHANGE IN THE STEEL MARKET WITHIN THE MEANING OF THOSE ARTICLES .

26 SINCE , THE COMMISSION CONTINUES , THE SITUATION HAD IMPROVED TO SOME EXTENT BY THE FOURTH QUARTER OF 1982 AS A RESULT OF A SLIGHT RISE IN PRICES FOR CONCRETE REINFORCING BARS AND A SLIGHT REDUCTION IN THE PRICE OF SCRAP , THE COMMISSION REVERTED , AS FROM THAT QUARTER , TO THE SYSTEM OF EXAMINING EACH INDIVIDUAL CASE AS PROVIDED FOR IN ARTICLE 14 OF DECISIONS NO 1831/81 AND NO 1696/82 .

27 IN ORDER TO RESOLVE THIS ISSUE IT IS USEFUL TO RECALL THAT IN ITS JUDGMENT OF 21 JUNE 1958 IN CASE 8/57 ( GROUPEMENT DES HAUTS FOURNEAUX ET ACIERIES BELGES V HIGH AUTHORITY ( 1958 ) ECR 245 ) THE COURT HELD THAT THE POWERS CONFERRED ON THE COMMISSION BY THE ECSC TREATY ARE LIMITED BY THE SPECIFIC PROVISIONS SET OUT IN TITLE III OF THE TREATY AND THAT , IN PARTICULAR , SUCH POWERS WOULD BE DIVERTED FROM THEIR LAWFUL PURPOSE IF IT APPEARED THAT THE COMMISSION HAD MADE USE OF THEM WITH THE EXCLUSIVE , OR AT ANY RATE THE MAIN , PURPOSE OF EVADING A PROCEDURE SPECIFICALLY PRESCRIBED BY THE TREATY FOR DEALING WITH THE CIRCUMSTANCES WITH WHICH IT IS REQUIRED TO COPE .

28 IN THIS REGARD IT IS CLEAR FROM THE PREAMBLES TO THE CONTESTED DECISIONS AND FROM THE EXPLANATIONS OF THE COMMISSION SUMMARIZED ABOVE THAT THE COMMISSION WAS IN FACT PURSUING THE AIMS OF ARTICLE 14 OF THE BASIC DECISIONS AND THAT IN FOUNDING ITS ACTION ON ARTICLES 16 AND 18 OF THOSE DECISIONS IT NOT ONLY AVOIDED THE RESTRICTIONS LAID DOWN IN ARTICLE 14 BUT ALSO SOUGHT TO AVOID THE EXAMINATION OF EACH INDIVIDUAL CASE PRESCRIBED BY THAT ARTICLE .

29 SINCE THE QUOTA SYSTEM INTRODUCED BY DECISIONS NO 2794/80 , NO 1831/81 AND NO 1696/82 WAS BASED ON THE APPLICATION TO ALL UNDERTAKINGS OF UNIFORM ABATEMENT RATES FOR EACH CATEGORY OF PRODUCTS SUBJECT TO IT - UNLESS THE INDIVIDUAL SITUATION OF THE UNDERTAKING IN QUESTION JUSTIFIED AN EXCEPTION , THE COMMISSION COULD DECIDE UPON A GENERAL INCREASE OF THE QUOTAS FOR A WHOLE GROUP OF UNDERTAKINGS CHARACTERIZED BY THEIR STRUCTURE ONLY AFTER FOLLOWING THE PROCEDURE LAID DOWN IN ARTICLE 58 OF THE TREATY , THAT IS TO SAY AFTER CONSULTING THE CONSULTATIVE COMMITTEE AND OBTAINING THE ASSENT OF THE COUNCIL . CONSEQUENTLY , IN ACTING PURSUANT TO ARTICLES 16 AND 18 OF THE BASIC DECISIONS , THE COMMISSION ALSO EVADED THE PROCEDURE SPECIFICALLY LAID DOWN BY THE TREATY FOR THAT PURPOSE .

30 IN THOSE CIRCUMSTANCES THE APPLICANTS ' SUBMISSION THAT DECISIONS NO 533/82 AND NO 1698/82 WERE VITIATED BY A MISUSE OF POWERS AFFECTING THEM MUST BE UPHELD , WITHOUT ITS BEING NECESSARY TO INVESTIGATE WHETHER THE CONSIDERATIONS ADVANCED BY THE COMMISSION WERE CAPABLE OF JUSTIFYING THE APPLICATION OF DIFFERENT ABATEMENT RATES TO THE SINGLE-PRODUCT UNDERTAKINGS AND THE INTEGRATED UNDERTAKINGS . CONSEQUENTLY , THOSE TWO DECISIONS MUST BE DECLARED VOID .

31 SINCE THE INDIVIDUAL DECISIONS ADDRESSED TO THYSSEN AG ON 30 MARCH AND 20 JULY 1982 CONCERNING THE REFERENCE-PRODUCTION FIGURES AND PRODUCTION QUOTAS FOR THE SECOND AND THIRD QUARTERS OF 1982 WERE BASED ON DECISIONS NO 533/82 AND NO 1698/82 , IN SO FAR AS THEY CONCERN THE ABATEMENT RATES FOR CONCRETE REINFORCEMENT BARS , THOSE INDIVIDUAL DECISIONS MUST ALSO BE DECLARED VOID IN ACCORDANCE WITH THAT APPLICANT ' S PLEADINGS .

Decision on costs

COSTS

32 UNDER THE TERMS OF ARTICLE 69 OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY IS TO BE ORDERED TO PAY THE COSTS . SINCE THE COMMISSION HAS FAILED IN ITS SUBMISSIONS IT MUST BE ORDERED TO PAY THE COSTS .

Operative part

ON THOSE GROUNDS ,

THE COURT

HEREBY :

1 . DECLARES VOID COMMISSION DECISION NO 533/82/ECSC OF 3 MARCH 1982 AMENDING FOR THE THIRD TIME DECISION NO 1831/81/ECSC ESTABLISHING FOR UNDERTAKINGS IN THE IRON AND STEEL INDUSTRY A MONITORING SYSTEM AND A NEW SYSTEM OF PRODUCTION QUOTAS IN RESPECT OF CERTAIN PRODUCTS AND COMMISSION DECISION NO 1698/82/ECSC OF 30 JUNE 1982 ADJUSTING THE ABATEMENT RATES FOR CATEGORY V PRODUCTS FOR THE THIRD QUARTER OF 1982 IN RESPECT OF CERTAIN UNDERTAKINGS ;

2 . DECLARES THAT THE INDIVIDUAL DECISIONS ADDRESSED BY THE COMMISSION ON 30 MARCH AND 20 JULY 1982 TO THYSSEN AKTIENGESELLSCHAFT CONCERNING ITS REFERENCE-PRODUCTION FIGURES AND PRODUCTION QUOTAS FOR THE SECOND AND THIRD QUARTERS OF 1982 ARE VOID IN SO FAR AS THEY CONCERN THE ABATEMENT RATES FOR CATEGORY V ;

3 . ORDERS THE COMMISSION TO PAY THE COSTS .