Kingdom of the Netherlands v Commission of the European Communities.
Date: 2005-07-14
53. 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).
54. 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).
55. 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).
56. 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 resolve 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.
62. It must be recalled that, as the Court found in paragraph 56 of its judgment in Emesa Sugar , 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 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.
67. 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).
69. Precisely because of that surplus, any additional import under the system of 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).
98. Secondly, as regards the argument based on breach of the duty to inform itself beforehand of the negative effects which the safeguard measure might have on the economy of the OCTs concerned and the undertakings affected, it must be stated that at the date on which the contested regulation was adopted proceedings had already been brought before both the Court of Justice and the Court of First Instance in respect of the requirements for importing sugar from the Netherlands Antilles and Aruba (see, in particular, in respect of the same problem, Emesa Sugar , on the subject of imports of sugar with ACP/OCT cumulation of origin; Cases C-26/00 and C-180/00 Netherlands v Commission , cited above, and Case T‑47/00 Rica Foods  v Commission  [2002] ECR II-113, as regards imports of sugar with EC/OCT cumulation of origin). Furthermore, as is apparent from paragraphs 28 to 30 of the judgment in Case C-26/00 Netherlands  v Commission , the adoption of Regulation No 2423/1999 was preceded by consultations between the Commission, the Kingdom of the Netherlands and the other Member States in the course of which the question of the economic consequences of the safeguard measure envisaged had to be discussed.
101. Thirdly, as regards the alleged possibility of having recourse to a measure more appropriate and less restrictive than that provided for by the contested regulation, in order to attain the objectives pursued by the Commission, such as the imposition of a minimum sale price, it must be observed that the principle of proportionality, which is one of the general principles of Community law, requires that measures adopted by Community institutions should not exceed the limits of what is appropriate and necessary in order to attain the legitimate objectives pursued by the legislation in question, and where there is a choice between several appropriate measures, recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued (Case C‑331/88 Fedesa and Others  [1990] ECR I‑4023, paragraph 13; Joined Cases C‑133/93, C-300/93 and C-362/93 Crispoltoni and Others  [1994] ECR I-4863, paragraph 41; Antillean Rice Mills and Others  v Commission , cited above, paragraph 52; and Case C‑189/01 Jippes and Others [2001] ECR I‑5689, paragraph 81).
102. As regards judicial review of compliance with that principle, bearing in mind the wide discretionary power enjoyed, in particular, by the Commission in matters concerning safeguard measures, the legality of such a measure can be affected only if the measure is manifestly inappropriate in terms of the objective which the competent institution is seeking to pursue (see, to that effect, Case C-301/97 Netherlands  v Council , cited above, paragraph 135 and the case-law cited there).
107. Such a security does not deprive genuinely interested undertakings of the possibility of exporting sugar to the Community. Whilst the amount of the security must admittedly be paid to obtain the import licences, that sum is reimbursed to the undertaking if the import operation is carried out (see, to that effect, Case C-110/97 Netherlands  v Council , paragraph 132).
114. The Court has consistently held that there is a misuse of power where an institution adopts a measure with the exclusive or main purpose of achieving an end other than that stated or evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case (see, in particular, Case C‑84/94 United Kingdom  v Council  [1996] ECR I-5755, paragraph 69, and Case C-48/96 P Windpark Groothusen  v Commission  [1998] ECR I-2873, paragraph 52).
122. 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).