European Commission v Federal Republic of Germany.
Date: 2013-10-22
23. The procedure laid down in Article 260(2) TFEU must be regarded as a special judicial procedure for the enforcement of judgments of the Court, in other words as a method of enforcement (Case C‑304/02 Commission v France [2005] ECR I‑6263, paragraph 92). Consequently, only a failure of a Member State to fulfil its obligations under the Treaty which the Court has held, on the basis of Article 258 TFEU, to be well founded may be dealt with under that procedure (Case C‑457/07 Commission v Portugal  [2009] ECR I‑8091, paragraph 47).
40. This conclusion is confirmed by the grounds of the judgment in Commission  v Germany , in the light of which the operative part of that judgment must be construed (see Case 135/77 Bosch  [1978] ECR 855, paragraph 4, and Case C‑526/08 Commission v Luxembourg  [2010] ECR I‑6151, paragraph 29).
41. In this connection, first, it is apparent from paragraph 30 of the judgment in Commission  v Germany that the Court decided to examine together the complaints relating to the incompatibility of Paragraphs 2(1) and 4(3) of the VW Law with Article 63(1) TFEU, by reason not only of the parties’ arguments but also of the ‘cumulative effects of [those] two provisions’.
45. The grounds of the judgment in Commission  v Germany thus confirm the conclusion drawn in paragraph 1 of the operative part of that judgment, according to which the failure to fulfil obligations established by the Court did not result from Paragraph 4(3) of that Law, considered in isolation, but solely from the combination of that provision with Paragraph 2(1) of the VW Law.
47. First, the interpretation given by the Commission to paragraphs 48 and 50 of the judgment in Commission  v Germany  is based on a partial reading of that judgment which does not take account of the inherent links between the various passages of the judgment, nor of the grounds of the judgment as a whole and their coherence. Thus, in observing, in paragraph 50 of that judgment, that Paragraph 4(3) of the VW Law ‘creates an instrument enabling the Federal and State authorities to procure for themselves a blocking minority allowing them to oppose important resolutions, on the basis of a lower level of investment than would be required under general company law’, the Court – contrary to what the Commission appears to suggest – did not in any way rule on the question as to whether or not that provision, on its own, infringes Article 63(1) TFEU. Moreover, that paragraph forms part of the line of reasoning framed by the preceding paragraphs of that judgment, in which the Court specified, in paragraphs 30 and 43, that it was appropriate to examine Paragraph 2(1) of the VW Law ‘alongside’ Paragraph 4(3) of that Law by reason of, inter alia, their ‘cumulative effects’. As for paragraph 48 of that judgment, to which the Commission also refers, suffice it to note that that paragraph contains only a finding purely of fact, namely that ‘when the VW Law was adopted in 1960, the Federal State and the Land  of Lower Saxony were the two main shareholders in Volkswagen, a recently privatised company, and each held 20% of its capital’.
48. Secondly, paragraph 51 of the judgment in Commission  v Germany  must also be construed in the light of the remainder of the judgment. Accordingly, in observing that the cap on voting rights ‘supplements’ a legal framework which enables the Federal and State authorities to exercise, on the basis of a reduced investment, considerable influence over the decisions adopted by Volkswagen, the Court stressed the complementary nature of Paragraphs 2(1) and 4(3) of the VW Law, and not, contrary to what the Commission claims, the independent effects of that latter provision.
50. Fourthly, whilst it is true that, in paragraph 81 of the judgment in Commission  v Germany , the Court upheld the complaints relied on by the Commission and alleging infringement of Article 63(1) TFEU, that fact cannot, in the absence of an express contrary indication, be treated as amounting to a finding by the Court that Paragraph 4(3) of the VW Law constitutes, on its own, a restriction on the free movement of capital.