Judgment of the Court (Sixth Chamber) of 9 January 1997. - Commission of the European Communities v Sociedade de Curtumes a Sul do Tejo Ldª (Socurte), Revestimentos de Cortiça Ldª (Quavi) and Sociedade Transformadora de Carnes Ldª (Stec). - Appeal - European Social Fund - Time-limit for bringing proceedings - Infringement of essential procedural requirements. - Case C-143/95 P.



European Court reports 1997 Page I-00001



Summary

Parties

Grounds

Decision on costs

Operative part



Keywords

1 Actions for annulment - Time-limits - Point from which time starts to run - Notification - Definition - Communication of the actual text of the decision challenged

(EC Treaty, Art. 173, fifth para.)

2 Appeals - Grounds - Erroneous assessment of the evidence adduced - Inadmissible if there is no claim that the Court of First Instance erred in law - Rejection

(EC Treaty, Art. 168a; EC Statute of the Court of Justice, Art. 51)

Summary

3 Notification of the Community acts referred to in the fifth paragraph of Article 173 and Article 191 of the Treaty necessarily involves the communication of a detailed account of the contents of the measure notified and of the reasons on which it is based. In the absence of such an account, its addressee would be denied the precise knowledge of the contents of the act in question, and of the reasons for which it was adopted, which he needs in order properly to bring proceedings against that decision. That requirement can be fulfilled only by the transmission of the text of the decision in issue and not by a brief summary of its contents. It follows that the time-limit for bringing proceedings starts to run only from the date of notification as defined above.

4 The appraisal by the Court of First Instance of the evidence put before it is not reviewable in appeal proceedings unless it is established that that Court erred in law.

Parties

In Case C-143/95 P,

Commission of the European Communities, represented by Francisco de Sousa Fialho and Nicholas Khan, of its Legal Service, acting as Agents, with an address for service in Luxembourg at the office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre, Kirchberg,

appellant,

APPEAL against the judgment of the Court of First Instance of the European Communities (First Chamber) of 7 March 1995 in Joined Cases T-432/93, T-433/93 and T-434/93 Socurte and Others v Commission [1995] ECR II-503, seeking to have that judgment set aside, the other parties to the proceedings being: Sociedade de Curtumes a Sul do Tejo Ld.a (Socurte), Revestimentos de Cortiça Ld.a (Quavi), now known as Estudos e Projectos Ld.a (Esprocil), and Sociedade Transformadora de Carnes Ld.a (Stec), now known as Estudos e Projectos Ld.a (J.A.P.), companies governed by Portuguese law, established at Pau Queimado, Portugal, represented by Carlos Botelho Moniz and António Magalhães Cardoso, of the Lisbon Bar, with an address for service in Luxembourg at the Chambers of Guy Harles, 8-10 Rue Mathias Hardt,

THE COURT

(Sixth Chamber),

composed of: G.F. Mancini, President of the Chamber, J.L. Murray (Rapporteur), C.N. Kakouris, G. Hirsch and H. Ragnemalm, Judges,

Advocate General: C.O. Lenz,

Registrar: R. Grass,

having regard to the report of the Judge-Rapporteur,

after hearing the Opinion of the Advocate General at the sitting on 4 July 1996,

gives the following

Judgment

Grounds

1 By application lodged at the Registry of the Court of Justice on 8 May 1995, the Commission of the European Communities brought an appeal pursuant to Article 49 of the EC Statute of the Court of Justice against the judgment of 7 March 1995 in Joined Cases T-432/93, T-433/93 and T-434/93 Socurte and Others v Commission [1995] ECR II-503 (`the contested judgment'), in which the Court of First Instance of the European Communities annulled the decision of the Commission reducing the amount of the European Social Fund's contribution to Project 860012/P1 relating to vocational training in Portugal in 1986 (`the contested decision').

2 Under Articles 1(2)(a) and 3(1) of Council Decision 83/516/EEC of 17 October 1983 on the tasks of the European Social Fund (OJ 1983 L 289, p. 38), the European Social Fund (`the Fund') may participate in the financing of vocational training and guidance operations carried out within the framework of Member States' labour-market policies.

3 Under Article 5(1) of Council Regulation (EEC) No 2950/83 of 17 October 1983 on the implementation of Decision 83/516/EEC (OJ 1983 L 289, p. 1), approval of an application for financing is to be followed by payment by the Fund of an advance of 50% of the approved assistance on the date on which the operations are scheduled to begin.

4 Article 6(1) of Regulation No 2950/83 provides that when Fund assistance is not used in conformity with the conditions set out in the decision of approval, the Commission may suspend, reduce or withdraw the aid after having given the relevant Member State an opportunity to comment.

5 The contested judgment shows that, during 1986, the Departamento para os Assuntos do Fundo Social Europeu (Department for European Social Fund Affairs, hereinafter `DAFSE'), which comes under the authority of the Portuguese Ministry of Employment and Social Security, submitted an application for Fund assistance for a series of vocational training projects put forward by a number of undertakings, including Sociedade de Curtumes a Sul do Tejo Ld.a (Socurte), Revestimentos de Cortiça Ld.a (Quavi) and Sociedade Transformadora de Carnes Ld.a (Stec) (`the respondents'). Those various projects were brought together in the same file, numbered 860012/P1, which was approved by decision of the Commission of 7 May 1986, under which the Fund's financial participation in the project was to be ESC 874 905 836, out of a total of ESC 1 905 322 299 (paragraph 4).

6 On 16 June 1986, DAFSE informed the respondents of that decision, specifying in each case the amount to be contributed by the Fund and the contribution to be made by the Portuguese authorities. On the basis of the amounts to be provided for their operations, the respondents received advances, both in the form of contributions from Portuguese public funds and by way of assistance from the Fund (paragraphs 5 and 6).

7 After completing their operations and submitting the final report, the respondents submitted a claim for payment of the balance of the Fund assistance, which showed that the cost of their operations had been lower than the approved budget. Pending the Commission's decision on that final payment claim, DAFSE made further payments to the respondents (paragraphs 7 and 8).

8 On 18 March 1991, DAFSE sent the applicants a letter informing them that the Commission had approved the final payment claim for Project 860012/P1. Having regard to the Fund participation provided for, DAFSE requested the respondents, in view of the amounts already paid to them, to pay back the sums of ESC 17 105 465 (Socurte), ESC 22 160 566 (Quavi) and ESC 46 354 557 (Stec) (paragraph 9).

9 By letter of 15 April 1991, the respondents asked DAFSE to inform them of the reasons for the request for repayment and to provide them with a copy of the Commission decision referred to in the letter of 18 March 1991 (paragraph 10).

10 By letter of 24 April 1991, received by the respondents on 30 April 1991, DAFSE informed them that the sums to be paid back were in fact lower than those given in its letter of 18 March 1991. DAFSE explained that this reduction in the sums to be repaid was due to the fact that it had initially interpreted the Commission's decision as meaning that the Fund had paid out ESC 379 373 605 instead of the ESC 437 452 918 actually granted (paragraph 11).

11 DAFSE relied in that respect on a letter dated 14 February 1991 which it had received from the Commission, a copy of which it sent to the respondents at the same time. According to that letter, the Commission, in reaching the decision to grant Fund assistance totalling ESC 437 452 918, had taken into account the existence of a number of service contracts, as well as the inspections carried out on both the undertaking in whose name the project file was registered and the beneficiaries (paragraph 12).

12 By letters sent to DAFSE on 14 May 1991 and to the Commission on 17 May 1991, the respondents asked to be sent certified copies of the Commission's original decision granting Fund assistance for Project 860012/P1 and of its decision relating to their final payment claim for the balance of that assistance (paragraph 13).

13 After orally informing the respondents that it did not have the requested documents in its possession, DAFSE sent them, by letter of 5 June 1991, a copy of a letter which it had sent to the Fund, requesting a copy of the Commission's decision on Project 860012/P1 (paragraph 14). The Commission in turn informed the respondents, by letter of 20 June 1991, that they should apply to DAFSE for the documents requested (paragraph 15). On 26 June 1991, the respondents consulted the administrative file on Project 860012/P1 in DAFSE's possession (paragraph 16).

14 By letter of 30 July 1991, DAFSE sent the respondents a certified copy of the notification of the Commission's decision of approval for Project 860012/P1 (paragraph 17). That document took the form of a letter from the Commission to DAFSE dated 10 July 1991, in which the grounds for the reduction in the financial assistance were set out in detail (paragraph 18). In that letter, the Commission stated in particular that an inspection visit made to Stec between 26 and 29 July 1988 had revealed that certain expenditure had been insufficiently substantiated and that a number of items had not been properly evaluated. Having regard to those factors, the Commission had itself carried out a reckonable-cost analysis on the basis of the criteria drawn up by the Portuguese authorities, which resulted in the reduction of the financial assistance initially provided for. That analysis gave an eligible amount equal to 56% of the total expenditure submitted, resulting in a claim for repayment of ESC 71 454 000 in respect of the Fund's participation (paragraphs 19 to 23). The Commission further stated that, at a meeting held at DAFSE to present and discuss the final conclusions relating to the file, the national officials responsible had presented their observations (paragraph 24). In conclusion, the Commission stated that, since the procedure laid down in Article 6(1) of Regulation No 2950/83 had been respected, it had been decided that the Fund assistance would amount to ESC 437 452 918, the sum which had already been paid as an initial advance (paragraph 25).

15 By three applications lodged at the Registry of the Court of Justice on 10 October 1991, the respondents applied, in particular, for annulment of the Commission's decision reducing the Fund's contribution in respect of Project 860012/P1.

16 By document lodged on 13 November 1991, the Commission raised an objection of inadmissibility under Article 91 of the Rules of Procedure of the Court of Justice. It contended, in particular, that, in so far as the applications were directed against the decision notified to the respondents by DAFSE's letters of 18 March and 24 April 1991, received by them on 21 March and 30 April 1991, they were inadmissible, since they had been lodged outside the time-limit laid down in the third paragraph of Article 173 of the EEC Treaty. It also maintained that the applications were inadmissible in so far as they were brought against the Commission's letter of 10 July 1991, of which the respondents were informed by DAFSE's letter of 30 July 1991, on the ground that, even if the Commission's letter could be deemed to constitute a decision, such a decision merely confirmed the decision which was notified to DAFSE by the Commission's letter of 14 February 1991 and brought to the respondents' knowledge on 18 March and 24 April 1991.

17 On 9 November 1992, the Court decided to join the objection of inadmissibility to the merits.

18 By order of 27 September 1993, made pursuant to Article 4 of Council Decision 93/350/Euratom, ECSC, EEC of 8 June 1993 amending Council Decision 88/591/ECSC, EEC, Euratom of 24 October 1988 establishing a Court of First Instance of the European Communities (OJ 1993 L 144, p. 21), the Court of Justice transferred the cases to the Court of First Instance.

19 The respondents advance, in essence, four pleas in support of their applications for annulment, alleging breach of the principles of legality and the protection of legitimate expectations, breach of essential procedural requirements and of the procedural rules laid down in Articles 6(1) and 7(2) of Regulation No 2950/83 and breach of the rules relating to the management of the Fund, in particular Articles 1 and 5(4) of that regulation.

The contested judgment

20 In the contested judgment, the Court of First Instance first of all examined whether the respondents were in a position to bring proceedings effectively against the Commission's decision, as brought to their knowledge on 30 April 1991 (paragraph 48).

21 The Court of First Instance recalled in that regard that, according to consistent case-law (judgments of the Court of Justice in Case 76/79 Könecke v Commission [1980] ECR 665, Case 59/84 Tezi Textiel v Commission [1986] ECR 887 and Case 236/86 Dillinger v Commission [1988] ECR 3761, paragraph 14; judgment of the Court of First Instance in Case T-465/93 Murgia Messapica v Commission [1994] ECR II-361, paragraph 29), failing publication or notification, it is for a party who has knowledge of a decision concerning it to request the whole text thereof within a reasonable period but, subject thereto, the period for bringing an action can begin to run only from the moment when the third party concerned acquires precise knowledge of the content of the decision in question and of the reasons on which it is based in such a way as to enable it to exercise its right of action (paragraph 49).

22 In the present case, the Court of First Instance found that, although the letter of 14 February 1991 contained information from which the existence of a decision and an abstract and general statement of reasons could be inferred, it did not state the precise reasons for which that decision had been adopted. On receiving DAFSE's letter of 24 April 1991 on 30 April 1991, the respondents had asked to be told the precise reasons for the decision refusing to pay the balance. They were not informed of those reasons until 30 July 1991, when DAFSE communicated the Commission's letter of 10 July 1991 to them. That letter gave a detailed account of the inspections carried out by the Fund's staff and concluded that there was a sum of the order of ESC 71 454 000 to be paid back. The Court of First Instance therefore considered that it was from the letter of 10 July 1991 that the respondents acquired sufficient knowledge of the reasons for the contested decision and were able effectively to bring proceedings against that decision (paragraph 50).

23 The Court of First Instance therefore held that the applications for annulment of the contested decision, as evidenced in the letter of 10 July 1991, had been brought within the prescribed time-limit (paragraph 51).

24 Next, in its assessment of the substance of the applications, the Court of First Instance examined, first of all, the plea alleging breach of essential procedural requirements, namely a failure to observe the procedural rules contained in Article 6(1) of Regulation No 2950/83 (paragraph 57).

25 The Court of First Instance emphasized in that connection that the opportunity provided by Article 6(1) for the relevant Member State to comment before a definitive decision is taken to reduce Fund assistance, whether as regards the principle of the reduction or as regards its precise amount, is an essential procedural requirement the disregard of which renders the decision void (paragraph 65).

26 It inferred from this that the submission by the relevant Member State of its comments prior to a decision reducing Fund assistance must be established with a sufficient degree of certainty and clarity, which precludes any proof by presumption (paragraph 66).

27 In order to determine whether those conditions were observed in the present case, the Court of First Instance proceeded to examine the documents referred to by the Commission. Those documents concerned three inspection visits carried out by it from 27 October to 3 November 1986, from 28 September to 2 October 1987 and from 26 to 29 July 1988, as well as two meetings held in June 1988 between the Commission's representatives and the Portuguese authorities (paragraphs 67 to 70 and 72 to 75).

28 The Court of First Instance thus concluded that those documents did not allow the conclusion that the Commission had satisfied its obligation under Article 6(1) of Regulation No 2950/83. Consequently, it annulled the contested decision (paragraphs 71 and 76).

The appeal

29 The Commission advances two pleas in support of its appeal against the contested judgment, the first of which concerns the admissibility of the applications and the second their substance.

The first plea

30 In support of its first plea, the Commission maintains that the case-law cited by the Court of First Instance in paragraph 49 of the contested judgment is not applicable in the present case, since it relates only to situations in which there has been a failure to publish or notify the decision. In the present case, the decision of 14 February 1991 was notified to the respondents on 30 April 1991, so that the time-limit for bringing proceedings started to run from that date.

31 It must be stated in that regard that notification of the Community acts referred to in the fifth paragraph of Article 173 and Article 191 of the EC Treaty necessarily involves the communication of a detailed account of the contents of the measure notified and of the reasons on which it is based. In the absence of such an account, the third party concerned would be denied precise knowledge of the contents of the act in question and of the reasons for which it was adopted, which would enable him to bring proceedings effectively against that decision (see, in particular, with regard to Article 191, Case 58/88 Olbrechts v Commission [1989] ECR 2643, paragraph 10).

32 That requirement can be fulfilled only by sending the text of the decision in issue and not a brief summary of its contents, such as that contained in the letter notified to the respondents on 30 April 1991.

33 It follows, in the present case, that the time-limit for bringing proceedings cannot have started to run from that date. The first plea must therefore be rejected.

The second plea

34 In support of its second plea, the Commission maintains that it is clear beyond question from the evidence adduced before the Court of First Instance concerning the circumstances in which the inspection visits were carried out, the contacts established with the Portuguese Minister and the contents of the contested decision, which constitutes a compromise solution in favour of the respondents, that the national authorities were given an opportunity to comment prior to the adoption of the decision, of the tenor of which they were in any event fully aware at the time when it was adopted. It therefore submits that the Court of First Instance erred in finding that the Commission failed to fulfil its obligation to consult the Member State concerned under Article 6(1) of Regulation No 2950/83.

35 This plea raises, in essence, the question whether the evidence adduced by the Commission in the proceedings before the Court of First Instance enabled it to conclude, with a sufficient degree of certainty, that the Commission had not fulfilled its obligation to give the Member State concerned an opportunity to comment prior to adoption of the decision.

36 It must be stated in that regard that the appraisal by the Court of First Instance of the evidence put before it is not reviewable unless it is established that that Court erred in law (see, in particular, Case C-53/92 P Hilti v Commission [1994] ECR I-667, paragraph 42).

37 In the present case, the Commission has not shown that the appraisal by the Court of First Instance of the evidence thus produced was vitiated by an error of law.

38 The second plea advanced in the appeal must therefore also be rejected.

39 In the light of the foregoing, the appeal must be dismissed in its entirety.

Decision on costs

Costs

40 Under Article 69(2) of the Rules of Procedure, which applies to appeals pursuant to Article 118, the unsuccessful party is to be ordered to pay the costs. Since the Commission has been unsuccessful, it must be ordered to pay the costs of the appeal.

Operative part

On those grounds,

THE COURT

(Sixth Chamber)

hereby:

1. Dismisses the appeal;

2. Orders the Commission of the European Communities to pay the costs.