Judgment of the General Court (Fourth Chamber, Extended Composition) of 13 July 2018 — Bourdouvali and Others v Council and Others

(Case T‑786/14)

(Non-contractual liability — Economic and monetary policy — Stability support programme for Cyprus — Decision of the Governing Council of the ECB relating to emergency liquidity assistance following a request from the Central Bank of Cyprus — Euro Group Statements of 25 March, 12 April, 13 May and 13 September 2013 concerning Cyprus — Decision 2013/236/EU — Memorandum of Understanding of 26 April 2013 on Specific Economic Policy Conditionality concluded between the Republic of Cyprus and the European Stability Mechanism — Jurisdiction of the General Court — Admissibility — Formal requirements — Exhaustion of national rights of action — Sufficiently serious breach of a rule of law intended to confer rights on individuals — Right to property — Legitimate expectations — Equal treatment)

1. Actions for damages — Subject-matter — Application for compensation for damage attributable to the Union — Jurisdiction of the EU judicature — Application for compensation for damage caused by the national authorities — Jurisdiction of the national courts (Arts 268 TFEU and 340, second and third para. TFEU) (see paras 77-80)

2. Actions for damages — Subject-matter — Application for compensation for damage caused by the Commission or by the European Central Bank in carrying out the tasks imposed by the Treaty Establishing the European Stability Mechanism — Admissibility (Arts 268 TFEU and 340, second para. TFEU) (see para. 81)

3. Actions for damages — Autonomous form of action — Difference compared to an action for annulment — Capacity to be a defendant — Determination criteria (Arts 263 TFEU, 268 TFEU and 340, second para. TFEU) (see paras 105-108)

4. Actions for damages — Subject-matter — Application for compensation for damage caused by the Eurogroup in exercising its jurisdiction conferred by EU law — Admissibility (Art. 3 TEU; Arts 119(2) TFEU, 137 TFEU and 268 TFEU; Protocol No 14 annexed to the Treaties EU and FEU, Art. 1) (see para. 109)

5. Economic and monetary policy — Monetary policy — Coordination of monetary policies — Informal meeting of Member States using the euro within the Eurogroup — Subject-matter — Composition (Art. 137 TFEU; Protocol No 3 annexed to the Treaties EU and FEU, Art. 1; Treaty Establishing the European Stability Mechanism, Art. 5(1)) (see paras 119-121)

6. Economic and monetary policy — Economic policy — Coordination of economic policies — European stability mechanism — Assignment of competencies in relation to the award of financial assistance — Subject to international public law — Whether acts committed by the Commission and the European Central Bank are attributable to them by virtue of the functions conferred by the Treaty on the stability mechanism — Not included (Treaty Establishing the European Stability Mechanism, Art. 13(4)) (see paras 124, 125, 166)

7. Economic and monetary policy — Monetary policy — Implementation — Specific measures to restore financial stability and sustainable growth in Cyprus — Integration of the activities of a national bank within the national central bank and conversion of deposits into shares within the latter bank — No discretion of the Member State concerned (Art. 136(1) TFEU; Council Decision 2013/236, Art. 2(6)(b) and (d)) (see paras 177-180, 185, 190)

8. Economic and monetary policy — Economic policy — Coordination of economic policies — European stability mechanism — Allocation of new tasks to the Commission and the European Central Bank — No effect on the powers conferred by the EU and FEU Treaties on those institutions — Ability to plead in an action for compensation that those tasks have been carried out unlawfully (Art. 17(1) TEU; Art. 282(2) TFEU; Treaty Establishing the European Stability Mechanism, Art. 13(3), (4) and (7)) (see paras 200-203)

9. EU law — Principles — Protection of legitimate expectations — Conditions — Specific assurances given by the authorities — Meaning — Assurances provided by the Eurogroup — Included (see paras 204, 205, 403, 426)

10. Judicial proceedings — Application initiating proceedings — Formal requirements — Identification of the subject-matter of the dispute — Brief summary of the pleas in law on which the application is based — Application for compensation for damage allegedly caused by an EU institution — Factors enabling identification of the conduct of which the institution is accused, the causal link and the reality and certainty of the damage caused (Statute of the Court of Justice, Art. 21, first para.; Rules of Procedure of the General Court (1991), Art. 44(1)(c)) (see paras 214, 215)

11. Actions for damages — Autonomous form of action — Exhaustion of national rights of action — Exception — Possibility for the Union court to identify the nature and quantum of the alleged damage (Arts 268 TFEU and 340, second and third para. TFEU; Rules of Procedure of the General Court (1991), Art. 44(1)(c)) (see paras 237-240)

12. Non-contractual liability — Conditions — Unlawfulness — Damage — Causal link — One of the conditions not satisfied — Claim for compensation dismissed in its entirety (Art. 340, second para. TFEU) (see para. 244)

13. Economic and monetary policy — Economic policy — Coordination of economic policies — European stability mechanism — Conclusion of a memorandum of understanding providing for the conversion of uninsured deposits in a domestic bank into shares and for the temporary freezing of other uninsured deposits in that bank — Whether compatible with depositors’ right to property — Assessment of less restrictive measures — Account taken of the urgency of the situation (Charter of Fundamental Rights of the European Union, Arts 17(1) and 52(1); Treaty Establishing the European Stability Mechanism, Art. 12) (see paras 254, 281, 289, 309)

14. Fundamental rights — Charter of Fundamental Rights of the European Union — Limitation of the exercise of the rights and freedoms enshrined in the Charter — Conditions — Requirement for the limitation to be included in a law — Scope (Charter of Fundamental Rights of the European Union, Art. 52(1) and (3)) (see para. 271)

15. Non-contractual liability — Conditions — Normative act involving technical choices and complex assessments — Sufficiently serious breach of a higher rule of law conferring rights on individuals — Requirement of a clear and serious breach of the limits of the wide discretion of the EU legislature (Art. 340 TFEU) (see para. 290)

16. Economic and monetary policy — Economic policy — Coordination of economic policies — European stability mechanism — Conclusion of a memorandum of understanding providing for the conversion of uninsured deposits in a domestic bank into shares and for the temporary freezing of other uninsured deposits in that bank — Whether compatible with depositors’ right to property — Existence of comparable situations — Different treatment of other euro area Member States benefitting from financial assistance — Infringement — Conditions (Charter of Fundamental Rights of the European Union, Art. 17(1); Treaty Establishing the European Stability Mechanism, Art. 12) (see paras 310-312)

17. Actions for annulment — Pleas in law — Infringement of essential procedural requirements — Lack of or inadequate statement of reasons — To be considered of the Court's own motion (Arts 263 TFEU and 296 TFEU) (see para. 389)

18. Acts of the institutions — Statement of reasons — Obligation — Scope — Assessment of the duty to state reasons by reference to the circumstances of the case — Need to specify all the relevant factual and legal elements — None (Art. 296 TFEU) (see paras 391-394)

19. European Central Bank — Competences of the European System of Central Banks — Determination of the conditions for recapitalisation and the resolution of financial institutions — Not included (Art. 282(1) TFEU; Protocol No 4 annexed to the Treaties EU and FEU, Art. 14.4) (see paras 414-416, 418)

20. Acts of the institutions — Legal nature — To be assessed on the basis of the content of the measure — Declaration of intention not having to be published in the L or C series of the Official Journal of the European Union — No legal value (see para. 419)

21. EU law — Principles — Protection of legitimate expectations — Conditions — Grant of financial aid to a Member State in difficulty subject to the adoption by it of certain measures in order to restore financial stability — Such measures not imposed on the grant of financial aid to other Member States — Infringement — None (Council Decision 2013/236) (see paras 431, 432)

22. EU law — Principles — Equal treatment — Meaning — Burden of proof (Charter of Fundamental Rights of the European Union, Arts 20 and 21) (see paras 439-441)

23. Economic and monetary policy — Monetary policy — Implementation — Specific measures to restore financial stability and sustainable growth in Cyprus — Break-up of an ailing bank and recapitalisation of another ailing bank by means of a conversion of uninsured deposits in the first bank into capital — Assumption by the second bank of the debt of the first bank from financial assistance — Different treatment of holders of uninsured deposits in the two banks compared to creditors with claims arising out of the financial assistance — Breach of the principle of equal treatment — None (Council Decision 2013/236; Memorandum of Understanding of 26 April 2013) (see para. 448)

24. EU law — Principles — Equal treatment — Discrimination on grounds of nationality — Prohibition — Not applicable in a situation purely internal to a Member State — Limits — Contribution by an EU institution to the maintenance or implementation of such treatment — Not permissible (Art. 18 TFEU) (see paras 460-462)

25. EU law — Principles — Equal treatment — Infringement — Meaning (see para. 464)

26. Economic and monetary policy — Monetary policy — Implementation — Specific measures to restore financial stability and sustainable growth in Cyprus — Break-up of an ailing bank and recapitalisation of another ailing bank by means of a conversion of uninsured deposits in the first bank into capital — Different treatment of holders of uninsured deposits in the two banks compared to holders of deposits with Greek branches of those banks — Breach of the principle of equal treatment — None (Council Decision 2013/236; Memorandum of Understanding of 26 April 2013) (see paras 468-470, 472)

27. Economic and monetary policy — Monetary policy — Implementation — Specific measures to restore financial stability and sustainable growth in Cyprus — Break-up of an ailing bank and recapitalisation of another ailing bank by means of a conversion of uninsured deposits in the first bank into capital — Transfer of deposits to the second bank subject to a ceiling of EUR 100000 per depositor — Breach of the principle of equal treatment — None (European Parliament and Council Directive 94/19, as amended by Directives 2005/1 and 2009/14, Recital 16 and Art. 7(1)a; Council Decision 2013/236; Memorandum of Understanding of 26 April 2013) (see paras 481-484)

28. Judicial proceedings — Burden of proof, etc. — Burden of proof (Rules of Procedure of the General Court (2015), Art. 85) (see para. 500)

29. Economic and monetary policy — Monetary policy — Implementation — Specific measures to restore financial stability and sustainable growth in Cyprus — Break-up of an ailing bank and recapitalisation of another ailing bank by means of a conversion of uninsured deposits in the first bank into capital — Different treatment of the holders of uninsured deposits in the two banks compared to companies in the cooperative banking sector not having been the subject of a bail-in — Breach of the principle of equal treatment — None (Council Decision 2013/236) (see paras 503-507)

Re:

Action under Article 268 TFEU seeking compensation for damage allegedly suffered by the applicants as a result of the decision of the Governing Council of the ECB of 21 March 2013 relating to emergency liquidity assistance following a request from the Central Bank of Cyprus, the Euro Group Statements of 25 March, 12 April, 13 May and 13 September 2013 concerning Cyprus, Council Decision 2013/236/EU of 25 April 2013 addressed to Cyprus on specific measures to restore financial stability and sustainable growth (OJ 2013 L 141, p. 32), the Memorandum of Understanding of 26 April 2013 on Specific Economic Policy Conditionality concluded between the Republic of Cyprus and the European Stability Mechanism (ESM), and other acts and conduct of the Commission, Council, the ECB and the Euro Group connected with the grant of a financial assistance facility to the Republic of Cyprus.

Operative part

The Court:

1. Dismisses the action;