European Commission v Hellenic Republic.
Date: 2018-02-22
49


Concerning infringement proceedings under Article 260(2) TFEU, the reference date which must be used for assessing whether there has been a failure to fulfil obligations is that of the expiry of the period prescribed in the letter of formal notice issued under that provision (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 36).
53


As regards the Hellenic Republic’s argument based on the difficulties which that Member State faced in complying with the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), it should be recalled that, in accordance with the Court’s settled case-law, a Member State cannot plead difficulties in its domestic legal order to justify a failure to observe obligations arising under EU law (see, to that effect, judgment of 4 May 2017, Commission v United Kingdom, C‑502/15, not published, EU:C:2017:334, paragraph 48).
82


According to the settled case-law of the Court, the imposition of a penalty payment is, in principle, justified only in so far as the failure to comply with an earlier judgment of the Court continues up to the time of the Court’s examination of the facts (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 61 and the case-law cited).
88


Nevertheless, it cannot be ruled out, a priori, that, on the date of delivery of the present judgment, full compliance with the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), will have taken place. Accordingly, the penalty payment must be imposed only if the failure to fulfil obligations persists on the date of delivery of the present judgment (see, by analogy, judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 66).
89


It is apparent from the settled case-law of the Court that the penalty payment must be decided upon according to the degree of persuasion needed in order for the Member State, which has failed to comply with a judgment establishing a breach of obligations, to alter its conduct and bring to an end the infringement established (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 67 and the case-law cited).
90


In exercising its discretion in the matter, it is for the Court to set the penalty payment so that it is both appropriate to the circumstances and proportionate to the infringement established and the ability to pay of the Member State concerned (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 68).
91


The Commission’s proposals concerning the penalty payment cannot bind the Court and constitute merely a useful point of reference. Similarly, guidelines such as those set out in the communications of the Commission are not binding on the Court but contribute to ensuring that the Commission’s own actions are transparent, foreseeable and consistent with legal certainty when that institution makes proposals to the Court. In proceedings under Article 260(2) TFEU relating to a failure to fulfil obligations on the part of a Member State that has persisted notwithstanding the fact that that same failure to fulfil obligations has already been established in a first judgment delivered under Article 258 TFEU, the Court must remain free to set the penalty payment to be imposed in an amount and in a form that the Court considers appropriate for the purposes of inducing that Member State to bring to an end its failure to comply with the obligations arising under that first judgment of the Court (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 69).
92


For the purposes of determining the amount of penalty payments, the basic criteria which must be taken into consideration in order to ensure that penalty payments have coercive effect and that EU law is applied uniformly and effectively are, in principle, the seriousness of the infringement, its duration and the ability of the Member State concerned to pay. In applying those criteria, regard must be had, in particular, to the effects on public and private interests of the failure to comply and to how urgent it is for the Member State concerned to be induced to fulfil its obligations (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 70).
93


In the first place, concerning the seriousness of the infringement, it should be borne in mind that Directive 91/271 is intended to protect the environment. A lack or shortage of urban waste water treatment plants is likely to harm the environment and must be regarded as particularly serious (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 71).
94


It is also necessary to cite as an aggravating circumstance the fact that the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), has not yet been fully complied with, according to the statements of the Hellenic Republic, which is equivalent to a delay of almost 20 years, in so far as the obligation to ensure that the secondary treatment of the urban waste water in the Thriasio Pedio area complied with EU law should have been fulfilled on 31 December 1998 at the latest (see, to that effect, judgment of 24 June 2004, Commission v Greece, C‑119/02, not published, EU:C:2004:385, paragraph 51). Accordingly, the Court cannot but confirm the particularly lengthy character of an infringement which, in the light of the objective mentioned above, is also a matter of indisputable gravity (see, by analogy, judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 74).
97


It is clear that, in the present case, the extent of the damage which, on the date of delivery of the present judgment, continues to be inflicted on human health and the environment because of the infringement depends in large part on the number of sites affected by that infringement. Accordingly, that damage is less extensive than the damage to human health and the environment caused by the initial failure to fulfil obligations established in the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385) (see, by analogy, judgment of 2 December 2014, Commission v Greece, C‑378/13, EU:C:2014:2405, paragraph 56).
99


As regards, in the second place, the duration of the infringement, it should be recalled that that duration must be assessed by reference to the date on which the Court assesses the facts and not the date on which proceedings are brought before it by the Commission. In the present case, the duration of the infringement, nearly 14 years from the date of delivery of the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), is considerable (see, by analogy, judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 76).
100


Although Article 260(1) TFEU does not specify the period within which a judgment must be complied with, it follows from settled case-law that the importance of immediate and uniform application of EU law means that the process of compliance must be initiated at once and completed as soon as possible (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 77 and the case-law cited).
101


In the third place, with regard to the ability to pay of the Member State concerned, it is apparent from the case-law of the Court that it is necessary to take account of recent trends in that Member State’s GDP at the time of the Court’s examination of the facts (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 78). In that regard, account must be taken of the arguments of the Hellenic Republic, according to which its GDP decreased by 25.5% between the year 2010 and 2016, when that Member State lodged its defence before the Court.
103


It should be noted in this connection that, even if, in order to ensure full compliance with the Court’s judgment, the penalty payment should be payable in its entirety until such time as the Member State has taken all the measures necessary to bring to an end the failure to fulfil obligations established, nevertheless, in certain specific cases, a penalty which takes account of the progress that the Member State may have made in complying with its obligations may be envisaged (see, to that effect, judgment of 2 December 2014, Commission v Greece, C‑378/13, EU:C:2014:2405, paragraph 60).
106


With regard to the periodicity of the penalty payment, the phased reduction component of the periodic penalty payment is fixed, in accordance with the Commission proposal, on a six-monthly basis, since the provision of proof of compliance with Directive 91/271 may require a certain period of time and in order to take account of any progress made by the defendant Member State. It will therefore be necessary to reduce the total amount relating to each of those periods by a percentage corresponding to the proportion representing the number of p.e. units which have actually been brought into line with the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), in the Thriasio Pedio area (see, by analogy, judgment of 15 October 2015, Commission v Greece, C‑167/14, not published, EU:C:2015:684, paragraph 66).
116


The first point to note is that, in exercising the discretion conferred on it in such matters, the Court is empowered to impose a penalty payment and a lump sum payment cumulatively (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 91).
117


The imposition of a lump sum payment and the fixing of that sum must depend in each individual case on all the relevant factors relating both to the characteristics of the failure to fulfil obligations established and to the conduct of the Member State involved in the procedure initiated under Article 260 TFEU. That provision confers a wide discretion on the Court in deciding whether to impose such a penalty and, if it decides to do so, in determining the amount thereof (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 92).
118


In the present case, all of the factual and legal elements which have led to the establishment of the infringement under consideration, in particular, the fact that other judgments, namely, in addition to the judgment of 24 June 2004, Commission v Greece (C‑119/02, not published, EU:C:2004:385), the judgments of 7 February 2013, Commission v Greece (C‑517/11, not published, EU:C:2013:66), and of 15 October 2015, Commission v Greece (C‑167/14, not published, EU:C:2015:684), establishing the failure of the Hellenic Republic to fulfil its obligations concerning the treatment of urban waste water, indicate that effective prevention of future repetition of similar infringements of EU law may require the adoption of a dissuasive measure, such as an order to make a lump sum payment (see, by analogy, judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 93).
119


In those circumstances, it is for the Court, in the exercise of its discretion, to fix the lump sum in an amount appropriate to the circumstances and proportionate to the infringement (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 94).
120


Relevant considerations in this respect include factors such as the seriousness of the infringement and the length of time for which the infringement has persisted since the delivery of the judgment establishing it (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 95).
126


Lastly, as the Commission has argued, regard must be had to the large number of judgments, referred to in paragraph 118 above, which have established failures by the Hellenic Republic to fulfil its obligations in relation to the treatment of urban waste water. Repetition of unlawful conduct by a Member State is all the more unacceptable where it takes place in a sector in which the effects on human health and the environment are particularly significant. In that regard, where a Member State repeatedly engages in unlawful conduct in a specific sector, this may be an indication that effective prevention of future repetition of similar infringements of EU law may require the adoption of a dissuasive measure, such as a lump sum payment (judgment of 22 June 2016, Commission v Portugal, C‑557/14, EU:C:2016:471, paragraph 99).