CELEX: C1997/199/73
Language: en
Date: 1997-06-28 00:00:00
Title: Action brought on 14 April 1997 by Monsanto Company against the Commission of the European Communities (Case T-112/97)

28 . 6 . 97               EN                Official Journal of the European Communities                                No C 199/27
The applicant claims that the Court should :                           with the wording of the Treaty, rescue aids are
                                                                       incompatible with the common market.
— annul Commission Decision 97/8 1/EC of 30 July
     1996 ,                                                            The applicant further maintains that the Commission has
                                                                       misused its powers, since no sufficient reduction in
                                                                       capacity was required and the inadequate restructuring
                                                                       programme was being financed de facto by means of the
— order the Commission to pay the costs .
                                                                       aid. A private shareholder as seller would have required
                                                                       the purchaser to assume a significantly greater degree of
                                                                       risk and a significantly higher degree of performance on
Pleas in law and main arguments adduced in support:                    the purchaser's part.
In     the   contested        decision ('), subsidies   of   OS        Finally, the applicant argues that none of the conditions
1 590 000 000 ( ECU 118 000 000 ) in the form of capital               for exemption under Article 92 ( 3 ) (c ) of the EC Treaty
injections from the wholly state-owned company Austria                 have been fulfilled . The aid to HTM facilitates the
Tabakwerke ('AT') to the Austrian company Head Tyrolia                 development not of an economic activity but only of a
Mares ('HTM ') were described as State aid within the                  single undertaking; there is no question of facilitating the
meaning of Article 92 ( 1 ) of the EC Treaty, and yet                  development of a certain economic area, since HTM 's
regarded as compatible with the common market within                   production sites are located in various regions, and the
the meaning of Article 92 ( 3 ) ( c ), subject to the fulfilment       necessary common interest is lacking.
of certain requirements by the Austrian Government.
                                                                       (') OJ No L 25 , 28 . 1 . 1997, p . 26 .
                                                                       ( 2 ) OJ No C 368 , 23 . 12 . 1994 , p . 12 .
The applicant, which is one of HTM's fiercest
competitors, argues that the subsidy leads to an unjustified
improvement in HTM's position, distorts competition, and
is incompatible which the common market for violation of
Article 92 ( 3 ) ( c ) of the EC Treaty.
                                                                       Action brought on 14 April 1997 by Monsanto Company
Its first argument is that the Commission has infringed its                 against the Commission of the European Communities
own Guidelines on State Aid for Rescuing and                                                     ( Case T-l 12/97)
Restructuring Firms in Difficulty ( 2 ), in that it:
                                                                                                    ( 97/C 199/73 )
— ignored a shareholder contribution which should be
     regarded as a subsidy and other payments made by AT                                (Language of the case: English)
     to HTM as early as 1993 (which could in themselves
     also be regarded as an existing aid scheme for the
     purposes of Article 93 of the EC Treaty ), even though            An action against the Commission of the European
     the combined amount of the aids thereby exceeded the              Communities was brought before the Court of First
     bounds of what was appropriate . Furthermore, those               Instance of the European Communities on 14 April 1997
     payments infringed both the GATT and the free trade               by Monsanto Company, represented by Clive Stanbrook
     agreement between the EEC and Austria in force at                 QC, of the Inner Temple, and Dr. Robert MacLean ,
     the time,                                                         Scotland, both of Stanbook and Hooper, Brussels, with an
                                                                       address for service in Luxembourg at the offices of Arsene
                                                                       Kronshagen, Rue Marie-Adelaide 22, Luxembourg.
— tolerated the bringing forward of losses for tax
     purposes into 1994, despite receipt of the aid in 1993 ,
                                                                       The applicant claims that the Court should:
— wrongly assumed that the insolvency of HTM would
     contribute to the formation of a narrow oligopoly,                — annul the Commission Decision of 14 January 1997
                                                                              concerning a definition of a position, in accordance
                                                                              with Article 175 of the EC Treaty, on the referral of
                                                                              the applicant's application to the Committee for
— failed sufficiently to consider the question of an                          Adaptation to Technical Progress and on the inclusion
     appropriate minimum rate of interest.                                    of bovine somatotrophin in Annex II to Council
                                                                              Regulation ( EEC ) No 2377/90, and
Furthermore, the above guidelines themselves infringed
Article 92 ( 3 ) ( c ) of the EC Treaty, since, in accordance          — order the Commission to pay the costs .
 ---pagebreak--- No C 199/28          EN                 Official Journal of the European Communities                                  28 . 6 . 97
Pleas in law and main arguments adduced in support:                Fifth, the Commission misused its powers by basing its
                                                                   decision on irrelevant considerations and motives of a
                                                                   political nature .
The applicant, a company incorporated under the laws of
Delaware, USA, has developed a veterinary medicinal
product called Sometribove which is classified as a                Finally, the Commission's decision infringed a number of
Recombinant Bovine Somatotrophin ( BST). Prior to                  agreements approved by the European Community under
marketing this product, the applicant was required to              the Final Act of the Uruguay Round of multilateral trade
obtain a marketing authorization from the EC Committee             negotiations . The Commission's decision is capable of
for Veterinary Medicinal Products ( CVMP). Before such             being reviewed against these standards and such a review
an authorization was obtained, Council Regulation ( EEC )          indicates that the decision itself is incompatible with the
No 2377/90 was adopted, establishing a Community                   terms of the GATT 1994 and the Agreement on the
procedure for the setting of minimum residue limits                Application of Sanitary and Phytosanitary Measures .
( MRLs ) for veterinary medicinal products in foodstuffs of
animal origin.
After the adoption of this Regulation, it became necessary
for the applicant to obtain a listing of Sometribove under
one of the Annexes to Council Regulation No 2377/90                Action brought on 15 April 1997 by Pierre Tomarchio
before a marketing authorization could be approved. An             against the Court of Auditors of the European
application for an MRL was made by the applicant                                                Communities
through the procedure established under that regulation .
By decision of 14 January 1997, the Commission rejected                                      ( Case T-l 13/97
the applicant's request that its case should be referred to                                    ( 97/C 199/74 )
the Committee for the Adaptation to Technical Progress
on the grounds that, by virtue of Council Decision 94/936/
EC, the marketing and administration of BST to dairy                               (Language of the case: French)
cows could not be authorized and that, therefore, the
applicant had no interest in obtaining an MRL. The
moratorium introduced by Council Decision 94/936/EC                An action against the Court of Auditors of the European
was the principal ground for the Commission 's arriving at         Communities was brought before the Court of First
its decision .
                                                                   Instance of the European Communities on 15 April 1997
                                                                   by Pierre Tomarchio, residing in Luxembourg, represented
                                                                   by Nicolas Lhoest, of the Brussels Bar, with an address for
The applicant claims the Commission decision should be             service in Luxembourg at the offices of Fiduciaire Myson
annulled on the following grounds:                                 Sari, 30 Rue de Cessange .
First, the Commission infringed the proper Community               The applicant claims that the Court should:
procedure for setting MRLs when it rejected the
applicant's case for inclusion of Sometribove in one of the
Annexes to Council Regulation No 2377/90 .                         — annul the decision of 21 June 1996 rejecting the
                                                                        applicant's request that consideration be given to the
                                                                        possible application of Article 31 ( 2 ) of the Staff
Second, in so deciding, the Commission in fact acted in a
                                                                        Regulations,
manner inconsistent with the principles of the
moratorium . In particular, the decision prevents the
applicant from conducting limited practical tests on the
                                                                   — annul, in so far as may be necessary, the decision of
effects of BST products .
                                                                        27 December 1996 rejecting the applicant's complaint,
Third, the applicant maintains that, in arriving at its
decision, the Commission infringed the principle of legal          — order the defendant to pay all the costs .
certainty, which in turn infringed the applicant's legitimate
expectation that the conditions for the granting of an
MRL would be based on a scientific assessment of the                Pleas in law and main arguments adduced in support:
product .
                                                                   The pleas in law and main arguments are the same as in
Fourth, the Commission infringed the principle of                   Case T-l 6/97 ( M.
 proportionality when adopting the present decision . The
 interference with the applicant's commercial activities as a       (') OJ No C 74, 8 . 3 . 1997, p . 27.
 result of the Commission's decision is disproportionate to
 any benefit that might be achieved by refusing to approve
the product under one of the Annexes referred to above .