20.

The first question to discuss is whether Regulations Nos 3085/78 and 3086/78 are vitiated by the infringement of an essential procedural requirement. According to the applicants, those two measures, on which the contested individual decisions of April 1979 were based, were adopted by means of an irregular procedure inasmuch as there was no consultation of the European Parliament, the Staff Regulations Committee or the Staff Committee. As a preliminary observation, it should be noted that when it is a question of amending the Staff Regulations and the Conditions of Employment of Other Servants, Community law lays down a legislative procedure involving the consultation of both the European Parliament (as well as the Court of Justice) and the Staff Regulations Committee. In fact, Article 24 of the Treaty establishing a Single Council and a Single Commission of the European Communities [the Merger Treaty] provides that “the Council shall, acting by a qualified majority on a proposal from the Commission ana after consulting the other institutions concerned, lay down the Staff Regulations of Officials ... and the Conditions of Employment of Other Servants ...”. The Staff Regulations in turn provide, in the third paragraph of Article 10, that the Staff Regulations Committee (composed of representatives of the institutions of the Communities and representatives of the Staff Committees) “shall be consulted by the Commission on any proposal for the revision of the Staff Regulations”. In the present case, therefore, there is no doubt that Regulation No 3085/78, which introduced a number of amendments to the Staff Regulations, could not have been adopted unless the Commission had consulted the Staff Regulations Committee and the Council had in turn, on a proposal from the Commission, consulted the Parliament and the Court of Justice. And indeed the preamble to that regulation records that the three opinions were given. The legal context is quite different as far as Regulation No 3086/78 is concerned, since its function is to implement the provisions of the Staff Regulations on weightings (Articles 64, 65 (2) and 82 of the Staff Regulations; the first paragraph of Article 20 and Article 64 of the Conditions of Employment of Other Servants). Therefore in the hierarchy of the sources of Community law it occupies a subordinate position in relation to the Staff Regulations. It is apparent that Article 24 of the Merger Treaty (quoted above) and the third paragraph of Article 10 of the Staff Regulations do not concern Regulation No 3086/78. At most, it might be thought that there is reason to apply, with regard to this regulation, Article 110 of the Staff Regulations, which provides that “the general provisions for giving effect to these Staff Regulations shall be adopted by each institution after consulting its Staff Committee and the Staff Regulations Committee provided for in Article 10”. But that proposition collapses when it is realized that Article 110 refers to the general provisions which it falls to each institution to adopt in order to give effect to the Staff Regulations internally (that is to say, it is an instance of the special legislative autonomy of each institution), whereas Regulation No 3086/78 was adopted by the Council in the exercise of its ordinary legislative power and contains provisions which are intended to be applied in the same way in relation to the staff of all the institutions. Thus the objections which have been directed against Regulation No 3086/78 on the ground of failure to consult the Staff Committee and the Staff Regulations Committee are without foundation; and there is no legal basis for supposing that the Parliament and the Court of Justice must be consulted about a regulation of this type. Having said that, how does one explain the fact that the applicants complain of the failure to seek the opinion of the Parliament and the Staff Regulations Committee with regard to Regulation No 3085/78 when the preamble to that regulation declares that the opinion of those bodies was obtained? In fact, the applicants do not dispute that the consultation took place. They merely observe that the Parliament and the Committee were consulted on draft amendments to the Staff Regulations which were very different from the text adopted in December 1978: to be precise, on the proposal submitted to the Council by the Commission on 1 April 1977 (see Official Journal C 99, p. 5 of 27 April 1977) on the introduction of the European unit of account into the Staff Regulations of Officials of the European Communities and into the Conditions of Employment of Other Servants of the Communities. In their opinion, the 1978 text, being different from the text submitted in the previous year, should have been the subject of further consultations. The Court of Justice had occasion to examine the legal aspects of the consultation of the Parliament in the judgment of 15 July 1970 in Case 41/69 ACF Chemiefarma v Commission [1970] ECR 661. There it was a question of establishing whether amendments which the Council makes to the wording of a regulation proposed by the Commission make it necessary to consult the Parliament again. The Court declared that when the Parliament has been consulted on a draft regulation, the Council is not bound to consult it again unless the amendments affect the substance of the draft, considered as a whole. That satisfies the need to ensure that the Parliament is able to express its opinion without unnecessarily complicating the procedure for the enactment of regulations. More recently, the Court confirmed that when consultation of the Parliament is mandatory its opinion must actually be expressed (judgments of 29 October 1980 in Cases 138/79 Roquette Frères v Council at paragraph 34 of the decision, and 139/79 Maizena v Council at paragraph 35 of the decision). Thus the crux of the problem is to establish, case by case, whether the amendments to the Commission's initial draft were so radical as to render the first consultation outdated and irrelevant; wherever that turns out to be the case, the Parliament must be consulted again so that it may effectively express its opinion. Let us now examine, in the light of those criteria, the procedure whereby Regulation No 3085/78 was adopted. The proposal submitted by the Commission on 1 April 1977 (Official Journal C 99, p. 5 of 22 April 1977) provided that Article 63 of the Staff Regulations was to be amended so that the remuneration of Community officials would be expressed in European units of account instead of in Belgian francs (see Article 1 of the draft); and further, that Article 17 of Annex VII to the Staff Regulations should be amended so that currency transfers should be weighted by a coefficient representing the ratio between the weighting for the country in the currency of which the transfer was made and the weighting for the country of the official's employment. It may be noted that a similar proposal for the amendment of Article 17 of Annex VI had already been submitted by the Commission on 13 June 1974 (Official Journal C 88, p. 25 of 26 July 1974). In 1978 the definitive version of Regulation No 3085/78 abandoned the idea of introducing the European unit of account into the field of remunerations, but adhered to the principal motivation behind the amendment, namely, the need to escape from the parities adopted by the International Monetary Fund and to apply to remunerations realistic exchange rates, substantially in line with current quotations. In the amended version, the second paragraph of Article 63 provides that “remuneration paid in a currency other than Belgian francs shall be calculated on the basis of the exchange rates used for the implementation of the general budget of the European Communities ...”. Both the adoption of the European unit of account and the reference to the rates used for the Community budget constitute solutions which satisfy the same objective : to avoid the continuation of a situation in which remuneration paid in local currencies is calculated on the basis of obsolete and fictitious exchange rates. The principal difference between the two solutions resides in the fact that in the event of the general adoption of the European unit of account salaries paid in Belgian francs would also have required to be expressed in such terms, whereas in the system which was adopted salaries in Belgian francs remain the point of reference from which salaries paid in other currencies are calculated. But it is well known that the Community budget is calculated in European units of account and that consequently the exchange rates used for the implementation of the budget correspond to the relationship between the European unit of account and national currencies. Therefore I do not believe that the new technical solution devised (recourse to the exchange rates used for the Community budget instead of the European unit of account) amended in economic terms the system applicable to remuneration paid in currencies other than the Belgian franc. We now come to Article 17 of Annex VII. The system which the original proposal put forward for the calculation of the weighting for transfers abroad of part of officials' remuneration was identical to the system adopted in the version which was enacted. Thus the sole difference lies in the replacement of the European unit of account by the parities used for the budget of which I have just spoken. That means that the proposal put forward in 1977 already entailed the increase in the cost of transfers which Regulation No 3085/78 finally authorized. Other differences between the two versions are certainly not substantial. I have already had occasion to point out that Regulation No 3085/78 amends Article 17 of Annex VII not only with regard to the currency parities and weightings applicable, but also in other respects, making possible transfers “in the currency of [the official's] previous country of employment or of the country in which his institution has its seat, provided that the official in question has been assigned to a post outside the territory of the European Communities” (Article 17 (2) (a), third indent) and making it possible to have regular transfers made in excess of the amount received by way of foreign residence or expatriation allowance in certain circumstances (Article 17 (2) (b)). Those two amendments were not contained in the 1977 draft. However, those aspects of the rules on transfers are clearly of a marginal nature in comparison with the central innovation, which lay in the introduction of new parities and new weightings. That being so, I consider, in short, that, as regards the rules on transfers abroad of part of officials' emoluments (the subject-matter of the cases with which we are concerned), the text adopted by the Council was not substantially different from the text originally submitted by the Commission. Therefore it was not necessary to obtain a fresh opinion from the Parliament and Regulation No 3085/78 cannot be held to be vitiated, in this respect, on the ground that the Parliament was not consulted. Similar conclusions apply to the alleged failure to consult the Staff Regulations Committee. The applicants also contend that the Commission gave the Parliament insufficient and misleading information when in 1977 it sent to the Parliament its first proposal for the amendment of the Staff Regulations and declared that the new rules on exchange rates would not entail reductions in officials' financial benefits. In fact the report submitted on behalf of the Committee on Budgets (Document 218/77 of 7 July 1977, PE 49.101/def.) states that “the rapporteur accepts the Commission's assurances that its proposals will in no way adversely affect the rights of officials and other servants as regards the real value of their remuneration, pensions, allowances, etc.” In the course of the discussion which took place in the Parliament (still on the same argument) at the session of 7 July 1977, Commissioner Tugendhat explained that the objective of the new system was “financial neutrality” (Official Journal, Annex, No 219, July 1977, Report of Proceedings from 4 July 1977 to 8 July 1977, p. 303). Similar sentiments were expressed in the resolution whereby the Parliament expressed its opinion on the Commission's proposal; the fifth recital in the preamble to that resolution states that “the Commission has given assurances that its proposals will in no way adversely affect the remunerations and other allowances of officials and other servants of the European Communities” (Official Journal C 183, p. 55 of 1 August 1977). However, it must be noted that on the specific question of the cost of transfers abroad of part of officials' salaries the attitude of the Commission was more vague, not to say evasive. At the session of the European Parliament on 7 July 1977, Commissioner Tugendhat merely declared that the question of transfers had also been of concern to the Commission and that a proposal to amend the Staff Regulations in that connexion was under consideration. (Official Journal, Annex No 219, July 1977, p. 304). The truth is that the new system was really neutral only for salaries paid entirely in a currency other than the Belgian franc to officials employed in countries other than Belgium and Luxembourg. In fact it is not disputed that after the adjustment of the parities and weightings those officials received, in April 1979 (when the new system was first applied) the same salary — in terms of local currency — as they had received the previous month under the old system. For transfers abroad of part of their salaries the positions was different because the cost of such transfers increased appreciably in certain countries with a weak currency such as Italy, Ireland and the United Kingdom. In any event, I believe it may be said that the Parliament was sufficiently well-informed about all aspects of the new rules, and that strikes me as the decisive factor. I have already stressed that the wording of Article 17 of Annex VII, in the proposal made in 1977, entailed the same effect of increasing the cost of transfers as was eventually produced by Regulation No 3085/78. As regards other items of information available, I note that the annexes to the report submitted to the Committee on Budgets by Mr Cointat include not only the table relating to the cost of transfers of currency from Germany and from the Netherlands (see p. 18 of the report, already cited), but also a table relating to the costs of transfers of currency from Italy, the United Kingdom, Germany, Denmark and France (ibid p. 19). Thus the Members of the Parliament could have learned of the increased costs by examining those documents, not to mention the fact that they could in any case have sought the opinion of experts if they were not able properly to understand those aspects of the new rules which were of a predominantly technical nature. Therefore I think that the Parliament was put in a position to express its opinion effectively.