CELEX: C1998/258/34
Language: en
Date: 1998-08-15 00:00:00
Title: Action brought on 25 May 1998 by the Commission of the European Communities against the Kingdom of Belgium (Case C-201/98)

C 258/20              EN                  Official Journal of the European Communities                                    15.8.98
     legally permissible, that is to say, adequate, not              Reference for a preliminary ruling by the Regeringsrätten
     vitiated by any error of law or of fact and not                 by order of that court of 29 April 1998 in the case of X
     contradictory;                                                             AB and Y AB against Riksskatteverket
                                                                                           (Case C-200/98)
Ð infringement of the Staff Regulations of officials of the
     European Communities, in particular Articles 12, 13,                                    (98/C 258/33)
     14 and 17, the first and second paragraphs of
     Article 21, Article 25, the second paragraph of
     Article 87 and the fifth paragraph of Article 88 thereof
     and Annex IX thereto, in particular Articles 1, 2 and           Reference has been made to the Court of Justice of the
     3, the second paragraph of Article 7 and Article 11 of          European Communities by order of 29 April 1998,
     that annex;                                                     received at the Court Registry on 22 May 1998, for a
                                                                     preliminary ruling in the case of X AB and Y AB against
Ð breach of the general principles applicable under                  Riksskatteverket on the following question:
     Community law, in particular the principle of the
     rights of the defence, the audi alteram partem rule, the
     principle that the court seised of the proceedings must
     be impartial (and Article 6 of the Convention on                Under Paragraph 2(3) of Law 1947:576 on State Income
     Human Rights), the principles of legal certainty, good          Tax, an intra-group transfer is treated, under certain
     faith and the protection of legitimate expectations, the        conditions, as having fiscal effect if it is made by a
     duty to have regard for the welfare and interests of            Swedish limited liability company to another Swedish
     officials and the principle that all administrative acts        limited liability company which is wholly owned either by
     must be based on legally permissible grounds, that is           the first-named company directly or by that company
     to say, grounds which are pertinent and not vitiated by         together with a wholly-owned Swedish subsidiary or
     any error of law or of fact.                                    subsidiaries. The fiscal result is the same if one, or more,
                                                                     of the wholly-owned subsidiaries is foreign provided it is
                                                                     established, or they are established, in one and the same
The contested judgment applies a restrictive interpretation          Member State and Sweden has concluded with that State a
to the fifth paragraph of Article 88 of the Staff                    double-taxation      agreement       containing    a    non-
Regulations of officials; the object of that provision is to         discrimination clause. Against that background, is it
ensure that the administrative authority charged with                compatible with existing Community law, in particular
investigating the matter and thereafter, as the case may be,         Article 52 in combination with Article 58 and Article 73b
with imposing a disciplinary measure is fully informed of            and d of the Treaty of Rome, to apply a set of rules under
the facts alleged against the official concerned which form          which an intra-group transfer is not treated as having the
the subject-matter of the criminal prosecution brought               same fiscal effect when the Swedish parent company
against him.                                                         instead owns the recipient company together with two or
                                                                     more wholly-owned foreign subsidiaries which are
The appellant also complains that the Court of First                 established in different Member States with which Sweden
Instance based its contested judgment on incorrect                   has concluded a double-taxation agreement containing a
considerations and reasons which were contrary to the                non-discrimination clause?
items contained in the case-file. The Court of First
Instance failed in the contested judgment to arrive at the
proper factual or legal conclusions which it should have
drawn from the information in the file before it.
The contested judgment should also be annulled on the
ground that it misapplies the audi alteram partem rule, the
principle of equality of arms and the obligation to provide          Action brought on 25 May 1998 by the Commission of
a statement of pertinent reasons. Thus it wrongly                    the European Communities against the Kingdom of
concludes that the principle of equality of arms was                                            Belgium
respected on the ground that the appellant had access to                                  (Case C-201/98)
the documents which were available to the Disciplinary
Board for the purposes of delivering its opinion, on which                                   (98/C 258/34)
the appointing authority relied in adopting the contested
decision'. The Court of First Instance also wrongly based
on the same grounds its conclusion that the appellant was
given the opportunity of acquainting himself with all the
                                                                     An action against the Kingdom of Belgium was brought
facts on which the decision was based, in sufficient time
                                                                     before the Court of Justice of the European Communities
to enable him to submit his observations'.
                                                                     on 25 May 1998 by the Commission of the European
                                                                     Communities, represented by Frank Benyon, Legal
(1) Judgment of 19 March 1998 in Case T-74/96 (OJ C 137 of           Adviser, and Bernard Mongin, of its Legal Service, acting
    2.5.1998, p. 13).                                                as Agents, with an address for service in Luxembourg at
                                                                     the Office of Carlos Gómez de la Cruz, Wagner Centre,
                                                                     Kirchberg.
 ---pagebreak--- 15.8.98                EN                 Official Journal of the European Communities                                  C 258/21
The Commission of the European Communities claims                    The Kingdom of Belgium is wrong in maintaining that the
that the Court should:                                               time-limits for adjusting the cargo-sharing arrangements in
                                                                     respect of trades governed by the United Nations Code of
                                                                     Conduct for Liner Conferences have not expired and that
Ð declare that, by concluding and maintaining in force               the date on which Belgium signed the Code of Conduct
    the agreements with Mali containing cargo-sharing                did not constitute the deadline for adjusting the
    arrangements, and by omitting either to adjust the               arrangement. The Commission observes that, in any event,
    agreements with Senegal and Côte d'Ivoire in such a              no adjustment has been made 11 years after the entry into
    way as to provide for fair, free and non-discriminatory          force of the regulation and 5 years after expiry of the final
    access by Community nationals to cargo-shares due to             deadline for adjustment laid down by that regulation.
    Belgium or to denounce those agreements, Belgium has
    failed to fulfil its obligations under Council Regulation
    (EEC) No 4055/86 of 22 December 1986 applying the
    principle of freedom to provide services to maritime             The agreement concluded after the entry into force of
    transport between Member States and between                      Regulation No 4055/86 (between the Belgo-Luxembourg
    Member States and third countries (1), in particular             Economic Union and Mali)
    Articles 3 and 4(1) thereof in the case of Senegal and
    Côte d'Ivoire and Article 5 thereof in the case of Mali;
Ð order the Kingdom of Belgium to pay the costs.                     The prohibition of cargo-sharing arrangements in any
                                                                     further agreements' (Article 5 of the regulation) is
                                                                     designed to obviate the significant legal effects of such
                                                                     arrangements, which undermine the principle of freedom
Pleas in law and main arguments adduced in support:
                                                                     to provide services to maritime transport applied by
                                                                     Regulation No 4055/86. In order to guarantee the
                                                                     effectiveness of the prohibition, the Member States are
The existing agreements (between the Belgo-Luxembourg                obliged to refrain from including cargo-sharing
Economic Union and Senegal and between the Belgo-                    arrangements in any new agreements negotiated with third
Luxembourg Economic Union and Côte d'Ivoire                          countries.
The agreements with Senegal and Côte d'Ivoire entered
into force on 3 September 1984 and 25 October 1979,
                                                                     The agreement concluded with Mali contains cargo-
that is to say, prior to the entry into force of Regulation
                                                                     sharing arrangements which, in the case of future
No 4055/86. They are existing agreements which are
                                                                     agreements, may be authorised only in those exceptional
subject to the provisions of Articles 3 and 4 of that
                                                                     circumstances, provided for in Article 5(1) of Regulation
regulation.
                                                                     No 4055/86, where Community liner shipping companies
                                                                     would not otherwise have an effective opportunity to ply
                                                                     for trade to and from the country concerned, and which
Each of those agreements contains cargo-sharing                      may be permitted in accordance with Article 6 of the
arrangements reserving up to 40 % of trade for Belgian or            regulation, which provides for a proposal to be submitted
Luxembourg shipping companies, to the exclusion of                   by the Commission to the Council. Those criteria and
shipping companies established in other Member States of             procedures are not satisfied in the present case.
the Community. According to Article 3 of the regulation,
those arrangements are to be phased out or adjusted in
accordance with the provisions of Article 4.
                                                                     The agreement in question reserves carriage between the
Belgium is unable to produce any act effectively adjusting           parties thereto for vessels which fly the flag of either of
or phasing out the arrangements in the agreements with               those parties or which are operated by national shipping
Senegal, and has not referred to any notice published in             companies'. It follows that vessels operated by nationals
the Moniteur Belge. It has not therefore shown that the              of other Member States are excluded from the trade. The
cargo-sharing agreement has been terminated.                         agreement has therefore been contrary to the regulation
                                                                     since it entered into force. Consequently, the regulation
                                                                     has been infringed, albeit that Belgium purports to wish to
                                                                     terminate the agreement as regards the future. In any
As regards adjustment of the agreement concluded with
                                                                     event, no adjustment has been carried out to date.
Côte d'Ivoire, a draft additional protocol to the maritime
agreement between the Belgo-Luxembourg Economic
Union and the Republic of Côte d'Ivoire was
                                                                     (1) OJ L 378 of 31.12.1986, p. 1.
communicated to the Commission on 7 April 1998
(SG(98)A/5766). Quite apart from the fact that it requires
various alterations in order to bring it into line with
Community law, that draft has not yet been signed and
has not entered into force.