Judgment of the Court of 30 June 1966. - Ferriera Ernesto Preo e Figli v High Authority of the ECSC. - Case 2-65.



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Summary

Parties

Subject of the case

Grounds

Decision on costs

Operative part



Keywords

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COMMON FINANCIAL ARRANGEMENTS - EQUALIZATION OF FERROUS SCRAP - CALCULATION OF CONTRIBUTIONS - ACCOUNT TAKEN BY THE HIGH AUTHORITY OF RE-USE OF ARISINGS OF FERROUS SCRAP - AVERAGE PERCENTAGE OF SUCH ARISINGS ADOPTED FOR CALCULATION - PRECISE INFORMATION ESSENTIAL

( ECSC TREATY, ARTICLE 53 )

Summary

WHEN IT FIXES THE PECUNIARY OBLIGATIONS OF AN UNDERTAKING ASSESSABLE UNDER THE SCHEME FOR THE EQUALIZATION OF FERROUS SCRAP, THE HIGH AUTHORITY MUST SHOW - AND INDEED GIVE A STATEMENT OF REASONS FOR - THE AVERAGE PERCENTAGE ADOPTED IN THE CASE IN QUESTION FOR THE PURPOSE OF CALCULATING THE SIGNIFICANCE OF THE ARISINGS OF FERROUS SCRAP; A MERE MENTION THAT ACCOUNT HAS BEEN TAKEN OF SUCH ARISINGS IS INSUFFICIENT . THE LACK OF THIS INFORMATION CONSTITUTES A SERIOUS HINDRANCE TO THE ADEQUATE DEFENCE OF THE UNDERTAKINGS CONCERNED AND THE NECESSARY REVIEW BY THE COURT .

Parties

IN CASE 2/65

FERRIERA ERNESTO PREO E FIGLI, SOCIETA IN NOME COLLETTIVO, HAVING ITS REGISTERED OFFICE IN VENEZIA-MAGHERA, REPRESENTED AND ASSISTED BY RAOUL LEVIS OF THE VENICE BAR, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF CAMILLE WAGNER, 31 RUE DES ROSES,

APPLICANT,

V

HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL COMMUNITY, REPRESENTED BY ITS LEGAL ADVISER, ITALO TELCHINI, ACTING AS AGENT, ASSISTED BY ROLANDO QUADRI, ADVOCATE OF THE NAPLES BAR, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT ITS OFFICES, 2 PLACE DE METZ,

DEFENDANT,

Subject of the case

APPLICATION FOR THE ANNULMENT OF TWO INDIVIDUAL DECISIONS OF THE HIGH AUTHORITY OF 13 NOVEMBER 1964 RELATING TO THE PAYMENT OF THE CONTRIBUTIONS TO THE SCHEME FOR THE EQUALIZATION OF IMPORTED FERROUS SCRAP AND SCRAP TREATED AS SUCH,

Grounds

P.225

THE ADMISSIBILITY OF THE APPLICATION AGAINST THE HIGH AUTHORITY'S DECISIONS OF 13 NOVEMBER 1964 FIXING THE APPLICANT'S PECUNIARY OBLIGATIONS WITH REGARD TO THE EQUALIZATION SCHEME IS NOT DISPUTED AND THERE ARE NO GROUNDS FOR THE COURT TO RAISE THE MATTER OF ITS OWN MOTION .

THE SUBMISSION OF INFRINGEMENT OF AN ESSENTIAL PROCEDURAL REQUIREMENT SHOULD BE CONSIDERED FIRST OF ALL .

ACCORDING TO THE APPLICANT, THE DEFENDANT MADE FROM THE INFORMATION OBTAINED FROM THE UNDERTAKING INDIRECT HYPOTHETICAL DEDUCTIONS WHICH CANNOT BE CHECKED, AND MADE NO ATTEMPT TO GIVE A RELEVANT STATEMENT OF REASONS FOR THEM . IN PARTICULAR, THE CONSUMPTION OF ELECTRICITY, WHICH MAY BE ONE OF THE FACTORS FOR DETERMINING THE CONSUMPTION OF FERROUS SCRAP, CANNOT CONSTITUTE THE SOLE CRITERION FOR THE ASSESSMENT .

P.226

P.226

THE APPLICANT DECLARED THAT IT DID NOT KEEP NORMAL ACCOUNTING BOOKS, AND FAILED TO SUPPLY ANY EVIDENCE IN SUPPORT OF ITS SUBMISSIONS . IN THESE CIRCUMSTANCES, THE HIGH AUTHORITY WAS JUSTIFIED IN MAKING AN ESTIMATED ASSESSMENT AND, FOR THIS PURPOSE, IN HAVING RECOURSE TO THE PRINCIPAL VERIFIABLE FACTOR, IN THIS INSTANCE, THE CONSUMPTION OF ELECTRICITY IN THE UNDERTAKING'S FURNACE .

THE APPLICANT FURTHER COMPLAINS THAT THE STATEMENTS OF REASONS FOR THE CONTESTED DECISIONS GIVE NO INFORMATION AS TO THE WEIGHT ATTACHED BY THE HIGH AUTHORITY TO THE RE-USE OF ARISINGS OF FERROUS SCRAP . IN FACT IT EMERGES, ACCORDING TO THE APPLICANT, BOTH FROM THE STATEMENTS OF REASONS AND FROM THE DOCUMENTS PRODUCED, THAT NEITHER IN CALCULATING BY WAY OF EXTRAPOLATION THE QUANTITIES OF STEEL PRODUCED BY REFERENCE TO THE CRITERION OF ELECTRICITY CONSUMED, NOR IN ESTABLISHING THE RATIO BETWEEN THE CHARGE OF FERROUS SCRAP AND THE STEEL PRODUCED, DID THE HIGH AUTHORITY TAKE ACCOUNT OF THIS FACTOR, ALTHOUGH IT WAS ESSENTIAL IN FIXING THE BASIS OF ASSESSMENT TO LEVY .

THE DEFENDANT REPLIES TO THIS ALLEGATION BY REFERRING TO THE TENTH RECITAL IN THE PREAMBLE TO THE CONTESTED DECISION, WHICH PROVIDES THAT ' THE RATIO BETWEEN A SPECIFIED CHARGE OF FERROUS SCRAP AND THE STEEL PRODUCED MAY BE ASSESSED AT 1.015 KG ., TAKING ACCOUNT OF RECYCLING IN THE ROLLING MILL ', AND SAYS THAT IT IS APPARENT FROM THE LAST SIX WORDS QUOTED THAT IT HAS IN FACT TAKEN ACCOUNT OF THIS FACTOR IN ITS CALCULATIONS .

EVEN ON THE ASSUMPTION THAT THE SAID QUOTATION BORE THE MEANING ATTRIBUTED TO IT BY THE DEFENDANT, IT DOES NOT CONSTITUTE A STATEMENT OF REASONS, SUFFICIENT IN LAW, FOR THE ASSESSMENT . SINCE ARISINGS OFTEN REPRESENT A CONSIDERABLE PERCENTAGE OF THE FERROUS SCRAP WITH WHICH THE FURNACE IS CHARGED, IT IS NOT SUFFICIENT TO SHOW THAT ACCOUNT HAS BEEN TAKEN OF THEM . IT IS ESSENTIAL TO INDICATE, AND INDEED TO GIVE A STATEMENT OF REASONS FOR, THE AVERAGE PERCENTAGE ADOPTED IN THE CASE IN QUESTION FOR THE PURPOSE OF CALCULATING THEIR SIGNIFICANCE . THE LACK OF THIS INFORMATION ( WHICH MOREOVER APPEARS EASY TO SUPPLY ) CONSTITUTES A SERIOUS HINDRANCE TO AN ADEQUATE DEFENCE OF THE UNDERTAKINGS CONCERNED AND THE NECESSARY REVIEW BY THE COURT .

THE SUBMISSION IS THEREFORE WELL-FOUNDED AND IT MUST BE HELD THAT THE CONTESTED DECISION INFRINGED AN ESSENTIAL PROCEDURAL REQUIREMENT AND MUST THEREFORE BE ANNULLED .

Decision on costs

UNDER ARTICLE 69(2 ) OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS . IN THIS CASE, SINCE THE DEFENDANT HAS FAILED IN ITS SUBMISSIONS, IT MUST BE ORDERED TO PAY THE COSTS .

BY ORDER OF THE PRESIDENT OF THE COURT OF 12 FEBRUARY 1965, THE COSTS RELATING TO THE APPLICATION FOR THE ADOPTION OF AN INTERIM MEASURE WERE RESERVED FOR THE FINAL JUDGMENT . SINCE ITS APPLICATION FOR SUSPENSION HAS BEEN RULED INADMISSIBLE, THE APPLICANT MUST BE ORDERED TO PAY THE COSTS THEREOF .

Operative part

THE COURT

HEREBY :

1 . ANNULS THE INDIVIDUAL DECISIONS OF THE HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL COMMUNITY OF 13 NOVEMBER 1964 RELATING TO THE PAYMENT OF CONTRIBUTIONS TO THE SCHEME FOR THE EQUALIZATION OF IMPORTED FERROUS SCRAP AND SCRAP TREATED AS SUCH;

2 . ORDERS THE DEFENDANT TO PAY THE COSTS OF THE MAIN ACTION;

3 . ORDERS THE APPLICANT TO PAY THE COSTS OF THE APPLICATION FOR THE ADOPTION OF AN INTERIM MEASURE .