Case T‑676/13

Italian International Film Srl

v

Education, Audiovisual and Culture Executive Agency (EACEA)

‛Support programme for the European audiovisual sector (MEDIA 2007) — Measures of support for the transnational distribution of European films — Call for proposals in connection with the ‘selective’ scheme 2013 — EACEA act informing the applicant of the rejection of its application for the film ‘Only God Forgives’ — EACEA act confirming the rejection but stating new reasons — Powers — Distribution of tasks between the Commission and the EACEA — Circumscribed powers — Actions for annulment — Challengeable act — Admissibility — Obligation to state reasons — Permanent Guidelines 2012-2013 — Material or physical distribution agreement — Not communicated in advance to the EACEA — Application not eligible’

Summary — Judgment of the General Court (Eighth Chamber), 4 February 2016

Culture — EU Programmes — MEDIA Programme — Applications for financing for the distribution of films — Treatment by the Education, Audiovisual and Culture Executive Agency (EACEA) — Competence of the EACEA — Scope — Adoption of a decision, following a request for review, based on a ground not adopted in the Commission’s initial refusal decision — Not included

The mere fact that a letter has been sent to its addressee by an institution, body, office or agency of the European Union in response to a request by the addressee does not suffice for it to be regarded as a decision within the meaning of the fourth paragraph of Article 263 TFEU, thereby opening the door to an action for annulment. While an action for annulment is available against all measures taken by the institutions of the European Union, whatever their nature or form, and in certain cases, subject to the specific conditions and arrangements authorised by the fifth paragraph of Article 263 TFEU, against measures taken by bodies, offices and agencies of the European Union, that is conditional, where the action is brought by a natural or legal person, on those measures being intended to produce binding legal effects which are capable of affecting the interests of the applicant by bringing about a distinct change in his legal position. That is the case with a letter from the Education, Audiovisual and Culture Executive Agency (EACEA) maintaining a decision refusing an undertaking’s application for a grant for a film, following a call for proposals published in the context of Decision No 1718/2006 concerning the implementation of a programme of support for the European audiovisual sector (MEDIA 2007), where, in the context of that letter, the EACEA went beyond what would have been implied by a mere explanation of the Commission’s earlier rejection, did not confine itself to drawing attention to that decision, but itself took a position rejecting the undertaking’s application for a grant. Such a letter does indeed constitute a decision within the meaning of the fourth paragraph of Article 263 TFEU. (see paras 26, 27, 32, 34)

See the text of the decision. (see para. 35)

The competence of the Education, Audiovisual and Culture Executive Agency (EACEA) in the matter of grants awarded in the context of a call for proposals published in the context of Decision No 1718/2006 concerning the implementation of a programme of support for the European audiovisual sector (MEDIA 2007), is limited, first, to the examination of each applicant’s dossier in order to prepare a proposal for selection to be made by the Commission in conformity with comitology procedures, secondly, notification to beneficiaries of individual decisions on the award of grants and, thirdly, consideration of requests to review grant award decisions. Consequently, in circumstances where a candidate requests review of a rejection decision, the EACEA, to deal with that request, has a choice between restricting itself to clarifying the rejection decision and referring the matter to the Commission for the Commission to amend it, either by awarding a grant or by refusing a grant for reasons other than those originally adopted. In that regard, the EACEA cannot in any way be competent to amend a decision which it was not competent to adopt. It follows that where, following a request for review, the EACEA itself makes a refusal on a ground not adopted by the Commission, it acts outside its powers. (see paras 49, 51, 53)

See the text of the decision. (see paras 54, 65)

As may be seen from point 5.1 of the Permanent Guidelines for the MEDIA 2007 programme, annexed to a call for proposals published in the context of Decision No 1718/2006 concerning the implementation of a programme of support for the European audiovisual sector (MEDIA 2007), the award of a grant for distribution presupposes that the applicant himself does the theatrical distribution of the film in the territory concerned. That provision nonetheless provides for the possibility of the distributor making limited use of subcontracting, provided that it has been disclosed to the EACEA. In that context, point 5.1 in reality divides distribution agreements into three categories, corresponding respectively to subcontracting agreements, agreements for sharing distribution activities between several operators, and agreements for the use for specific services of physical distributors, who are not eligible for grants. However, the fact that those physical distributors are not eligible for grants does not mean that agreements for the use of those distributors for specific services do not have to be disclosed to the EACEA. Moreover, even if only to ascertain whether such a physical distribution agreement does actually exist and does not exceed those precise bounds, every applicant is required to provide the EACEA with as much information as possible on the necessary elements for examining the grant application, including the elements that may, because of a misunderstanding of their scope, block a favourable outcome of the application for a grant. That interpretation is all the more compelling in that, for a distributor, having recourse under contract to third-party companies to carry out some of the tasks of distribution is an exception to the principle that he must distribute the film himself, which means that it must be interpreted strictly. The interpretation giving priority to providing the EACEA with information that is as complete and appropriate as possible is, moreover, the only interpretation compatible with the principle of sound administration and, more particularly, of sound financial management and monitoring of the use of the Community budget resources for their intended purpose. Incomplete or incorrect information supplied by the applicant cannot lead the EACEA to recommend the Commission to finance the distribution of a film where there is doubt as to whether the distributor meets the conditions laid down by the applicable legislation. (see paras 56, 59, 60, 63)