Kingdom of the Netherlands v Commission of the European Communities.
Date: 2005-07-14
28. The Consultative Committee referred to in Article 1(2) of Annex IV to the OCT Decision met on 30 June 1999. The majority of the Member States stated that they were in favour of the Commission’s proposal to adopt safeguard measures. The Kingdom of the Netherlands opposed it, maintaining, among other things, that no evidence had been furnished that the sugar in question had been sold at a price below the Community price and that the requirements for the adoption of safeguard measures were not met.
29. The Commission did not, however, immediately implement that proposal, but initiated, in August 1999, a new procedure extended on that occasion to imports of sugar and of mixtures of sugar and cocoa coming from all the OCTs. According to the Commission, the tendency of imports to increase at prices below the intervention price, noted in June in respect of Aruba, had been confirmed as regards all the OCTs.
30. The Consultative Committee met again on the following 8 September and the majority of the Member States (the Kingdom of the Netherlands having reiterated its opposition to the Commission’s proposal) stated that they were in favour of the adoption of the safeguard measures, which were finally adopted on 15 November 1999, after a large increase in imports in the course of September and October of that year was established.
58. It should first be borne in mind that the Community institutions have a wide discretion in the application of Article 109 of the OCT Decision (see, to that effect, Case C-390/95 P Antillean Rice Mills and Others  v Commission  [1999] ECR I-769, paragraph 48, Case C‑110/97 Netherlands  v Council  [2001] ECR I-8763, paragraph 61, and Case C-301/97 Netherlands  v Council [2001] ECR I-8853, paragraph 73).
59. In those circumstances, the Community Court must restrict itself to considering whether the exercise of that discretion is vitiated by manifest error or misuse of powers and whether the Community institutions clearly exceeded the bounds of their discretion (see Antillean Rice Mills and Others  v Commission , cited above, paragraph 48, Case C-110/97 Netherlands  v Council , cited above, paragraph 62, and Case C-301/97 Netherlands  v Council , cited above, paragraph 74).
60. The scope of the Community Court’s review must be limited in particular if, as in the present case, the Community institutions have to reconcile divergent interests and thus to select options within the context of the policy choices which are their own responsibility (see, to that effect, Case C‑17/98 Emesa Sugar , cited above, paragraph 53).
61. Under Article 109(1) of the OCT Decision the Commission ‘may’ take safeguard measures ‘[i]f, as a result of the application of [that decision] serious disturbances occur in a sector of the economy of the Community or one or more of its Member States, or their external financial stability is jeopardised’, or ‘if difficulties arise which may result in a deterioration in a sector of the Community’s activity or in a region of the Community’. The Court of Justice held, in paragraph 47 of its judgment in Antillean Rice Mills and Others  v Commission , that, on the first hypothesis stated in that paragraph, the existence of a causal link must be established because the purpose of the safeguard measures must be to iron out or reduce the difficulties which have arisen in the sector concerned, and that, on the other hand, as regards the second hypothesis, it is not a requirement that the difficulties which justify the imposition of a safeguard measure result from the application of the OCT Decision.
67. It must be recalled, as the Court found in paragraph 56 of its judgment in Emesa Sugar , that in 1997 Community production of beet sugar already exceeded the quantity consumed in the Community; in addition cane sugar was imported from the ACP States to cater for specific demand for that product and the Community was under an obligation to import a certain quantity of sugar from non-member countries under the WTO agreements. The Community was also required to subsidise sugar exports by granting export refunds, within the limits laid down in the WTO agreements. In those circumstances and in view of the growing increase in imports of sugar from the OCTs since 1997, the Commission was entitled to take the view that any additional quantity of sugar reaching the Community market, even if minimal compared with Community production, would have obliged the Community institutions to increase the amount of the export subsidies, within the limits mentioned above, or to reduce the quotas of European producers, which would have disturbed the common organisation of the sugar market, the balance of which was already precarious, and would have been contrary to the objectives of the common agricultural policy.
73. Even if the imports in question were not at a price below the intervention price, the Commission sufficiently justified the safeguard measure at issue by pointing out that, in view of the stable consumption of sugar in the Community, the growing increase in sugar imports from the OCTs might cause growth in the volume of subsidised exports, itself resulting in an increase in the costs connected to those exports and hence in the contributions assumed by Community producers, or reductions in Community production quotas. Such difficulties, as the Court has already observed in paragraphs 40 and 56 of its judgment in Emesa Sugar , are likely to disturb the common organisation of the sugar market.
76. In that regard, it is sufficient to recall that Community production exceeds the consumption of sugar in the Community, a fact which the Netherlands Government does not dispute, and that the Community is, in addition, obliged to import a certain quantity of sugar from non-Member States under the WTO Agreements ( Emesa Sugar , paragraph 56).
78. Precisely because of that surplus, any additional import under the regime for EC/OCT cumulation of origin increases the surplus of sugar on the Community market and leads to an increase in subsidised exports (see Emesa Sugar , paragraph 56).
113. The Court observes that it is settled case-law that the statement of reasons required by Article 253 EC must be appropriate to the nature of the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Community Court to exercise its power of review. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons for a measure meets the requirements of Article 253 EC must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (see, inter alia, Joined Cases C-9/95, C-23/95 and C-156/95 Belgium and Germany  v Commission  [1997] ECR I-645, paragraph 44, and Case C-367/95 P Commission  v Sytraval and Brink’s France  [1998] ECR I-1719, paragraph 63).
126. So far as concerns the principle of proportionality, in order to establish whether a provision of Community law complies with that principle, it must be ascertained whether the means which it employs are suitable for the purpose of achieving the desired objective and whether they do not go beyond what is necessary to achieve it ( Antillean Rice Mills and Others  v Commission , paragraph 52).
128. It is important also to point out, as a preliminary, that it follows from the very essence of a safeguard measure that certain imported products will be subject to a less favourable regime than Community products ( Antillean Rice Mills and Others  v Commission , paragraph 54). It is not sufficient in those circumstances to argue, in order to establish an infringement of Article 109(2) of the OCT Decision, that that safeguard measure puts the imported products in question in a competitive position less favourable than that enjoyed by Community products. On the contrary, it must be shown that the measure in question is not suitable for the purpose of achieving the desired objective or that it goes beyond what is necessary to achieve it.