CELEX: C1998/340/15
Language: en
Date: 1998-11-07 00:00:00
Title: Action brought on 14 September 1998 by Commission of the European Communities against French Republic (Case C-337/98)

7.11.98                EN                  Official Journal of the European Communities                                   C 340/9
2. Whether in any event the award of reserved postal                      its action on the (more profitable) non-reserved
    monopoly services to a public undertaking, which                      services intended for the competition, and does so
    thereby occupies a dominant position in a substantial                 notwithstanding the express statutory commitments to
    part of the market, may be effected (without                          give absolute priority to the provision of services in
    Articles 86 and 90 of the Treaty being infringed)                     the public interest?
    without limitation as to time, directly by means of a
    law and implementing measures (in this case Article 2             5. Whether an infringement of Articles 85, 86 and 90 of
    of Law No 71/94); the foregoing in the absence of a                   the Treaty may derive (through confusion within the
    constitutive' State measure which Ð through                          same organisation between regulatory and operational
    impartial selection procedures Ð selects the most                     roles, inter alia through concession agreements that
    deserving undertaking which can most usefully                         self-selected the competition) form the fact that the
    respond to the public interest in having a more                       monopolistic operator of the general postal services (in
    efficient public service, the concession of the service               this case Ente Poste Italiane) notwithstanding the
    being for a limited period so that the results of the                 express statutory commitments to give absolute
    operation, upon which renewal might be made                           priority to the provision of those services rather than
    conditional, can be assessed?                                         to competing services, not only detaches itself from
                                                                          direct operation but also itself proceeds to appoint the
3. Whether the irregularity in paragraph 2 is aggravated                  outside concessionaires called on in turn to carry out
    by the fact that:                                                     the services covered by the monopoly, in breach of the
                                                                          very national law which reserves that power to the
    a) that public undertaking, appointed by legislative                  Member State (Article 111 of Law No 71/94)?
         measure to run all the reserved postal services, has
         not yet met the European standards by means of
         appropriate directions from the governing
         authority and the legislature intended to rationalise
         it (without any provision for cancellation in the
         event of failure to meet the objectives)?                    Action brought on 14 September 1998 by Commission of
                                                                          the European Communities against French Republic
    b) the State Ð pending the desired rationalisation Ð                                    (Case C-337/98)
         continues to allocate public money to deal with
         the undertaking's operating deficits?                                                (98/C 340/15)
    c) the State also proceeds to cover Ð again using                 An action against French Republic was brought before the
         public money Ð any non-profitable operations of              Court of Justice of the European Communities on
         the reserved service, without any comprehensive'            14 September 1998 by Commission of the European
         consideration of the profitability of that service,          Communities, represented by Michel Nolin, of its Legal
         which should, on the other hand, be assessed in              Service, acting as Agent, with an address for service in
         the context of the numerous territorial operations           Luxembourg at the office of Carlos Gómez de la Cruz,
         as a whole, without necessarily intervening in               Wagner Centre, Kirchberg.
         every area of difficulty, even though not reducing
         every entrepreneurial risk to zero?
                                                                      The applicant claims that the Court should:
    d) the EPI Ð by virtue of the combined effect of the
         provisions of the law establishing it, its statutes          Ð declare that, by adopting the Decision of 22 November
         and the programme contract Ð is at the same time                 1996 awarding Matra Transport the contract for the
         involved in the non reserved sector in (unequal?)                internal decoration of the light underground train
         competition       with    the    other     Community             project of the Greater Rennes District, the French
         undertakings, capitalising' to the maximum on its               Republic has failed to fulfil its obligations under
         role (its institutional role, deriving directly from a           Council Directive 93/38/EEC of 14 June 1993
         law) as a body in a dominant position covering the               coordinating the procurement procedures of entities
         entire postal monopoly?                                          operating in the water, energy, transport and
                                                                          telecommunications sectors (1), and in particular
                                                                          Articles 4(2) and 20(2)(c) thereof;
4. Whether Ð even if the foregoing points are
    disregarded Ð an infringement of Articles 85, 86 and              Ð order the French Republic to pay the costs.
    90 of the Treaty may derive from the fact that a public
    undertaking to which is entrusted by law without
    limitation as to time (and regardless of checks on                Pleas in law and main arguments adduced in support:
    productivity and efficiency) with the running of the
    general monopoly on postal services whilst at the same            The Commission considers that the contract in question
    time enjoying free access to the competing sectors (in            was concluded following a procedure without first being
    this case Ente Poste Italiane) may also, at its                   put up for tender even though the conditions set out in
    discretion, give up the direct operation of one or more           Article 20(2)(c) were not satisfied in the circumstances. It
    general services (subcontracting to third parties under           considers that the contract was awarded by resolution of
    concession agreements'), thus ultimately concentrating           the Greater Rennes District Council of 22 November 1996
 ---pagebreak--- C 340/10               EN                Official Journal of the European Communities                                        7.11.98
and not, as the French authorities maintain, by resolution          latter provision states that the invoice must be issued by a
of the Intercommunal Public Transport Board of                      taxable person to another taxable person and that it must
26 October 1989, that is to say before even Council                 relate to goods or services supplied by him to that other
Directive 90/531/EEC of 17 September 1990 on the                    person. The Netherlands rules at issue in the present case
procurement procedures of entities operating in the water,          do not refer to any such invoice.
energy, transport and telecommunications sectors (2)
entered into force.
                                                                    The economic considerations expounded by the
                                                                    Netherlands Government are not wholly without merit.
(1) OJ L 199 of 9.8.1993, p. 84.                                    However, they cannot result in the conclusion that the
(2) OJ L 297 of 29.10.1990, p. 1.
                                                                    legislation is to be interpreted in a manner contrary to its
                                                                    manifest provisions. Ratio legis non est lex.
                                                                    (1) Sixth Council Directive 77/388/EEC of 17 May 1977 on the
                                                                        harmonisation of the laws of the Member States relating to
                                                                        turnover taxes Ð Common system of value added tax:
Action brought on 14 September 1998 by the Commission                   uniform basis of assessment (OJ L 145 of 13.6.1977, p. 1).
of the European Communities against the Kingdom of the
                           Netherlands
                        (Case C-338/98)
                          (98/C 340/16)
                                                                    Action brought on 17 September 1998 by Italian Republic
An action against the Kingdom of the Netherlands was                            against Council of the European Union
brought before the Court of Justice of the European                                         (Case C-340/98)
Communities on 14 September 1998 by the Commission
of the European Communities, represented by Emile                                             (98/C 340/17)
Mennens and Enrico Traversa, acting as Agents, with an
address for service in Luxembourg at the office of Carlos
                                                                    An action against the Council of the European Union was
Gómez de la Cruz, of its Legal Service, Wagner Centre,
                                                                    brought before the Court of Justice of the European
Kirchberg.
                                                                    Communities on 17 September 1998 by the Italian
                                                                    Republic, represented by Professor Umberto Leanza,
The applicant claims that the Court should:                         acting as Agent, assisted by Ivo Braguglia, Avvocato dello
                                                                    Stato, with an address for service in Luxembourg at the
Ð declare that, by providing, contrary to Articles 17(2)(a)         Italian Embassy, 5 rue Marie-AdeÂlaïde.
    and 18(1)(a) of the Sixth VAT Directive 77/388/
    EEC (1), that an employer subject to VAT may deduct             The applicant claims that the Court should:
    part of the expenses reimbursed to an employee for
    the use of a private motor vehicle for business
    purposes, the Kingdom of the Netherlands has failed             Ð annul Article 1 of Council Regulation (EC) No 1361/
    to fulfil its obligations under the EC Treaty;                       98 (1) in so far as it does not fix the derived
                                                                         intervention price for white sugar for all areas of Italy
                                                                         for the sugar-marketing year 1998/99; in addition, if
Ð order the Kingdom of the Netherlands to pay the                        need be, annul Article 1(2) of Council Regulation (EC)
    costs.                                                               No 1360/98 (2) in so far as it fixes the intervention
                                                                         price for Italy also;
Pleas in law and main arguments adduced in support:
                                                                    Ð order the Council of the European Union to pay the
The rule at issue, which is laid down in Article 23                      costs of the proceedings.
of the Netherlands Uitvoeringsbesluit Omzetbelasting
(Implementing Regulation concerning Turnover Taxes)                 Pleas in law and main arguments adduced in support:
1968, is contrary to a fundamental aspect of the Sixth
VAT Directive, since it permits the deduction of cost
elements other than the VAT charged at the previous stage           For the marketing year 1998/99 both the intervention
by a taxable person to the taxable person making the                price and the derived intervention prices were fixed by
deduction.                                                          Regulations (EC) No 1360/98 and (EC) No 1361/98,
                                                                    which entered into force on 1 July 1998.
That fundamental incompatibility between the system
operating in the Netherlands and the Sixth VAT Directive            By so doing, the Council acted in contravention of the
is complemented by an incompatibility as regards formal             provisions contained in Article 3(4) and (5) of the basic
requirements. Article 18(1)(a) of the Sixth VAT Directive           Regulation (EEC) No 1785/81 (3), since it fixed the
provides that, in order to exercise his right to deduct, the        intervention prices (including the derived intervention
taxable person must, prior to making the deduction, hold            prices) in June 1998, whereas it should have fixed them by
an invoice drawn up in accordance with Article 22(3); the           August 1997.