Matsushita Electric Industrial Co. Ltd and Matsushita Electric Trading Co. Ltd v Council of the European Communities.
Date: 1992-03-10
12 As the Court has already held, in particular in its judgment in Case 250/85 Brother v Council [1988] ECR 5683, at paragraph 16, the division of production and sales activities within a group made up of legally distinct companies can in no way alter the fact that the group is a single economic entity which organizes in that way activities that, in other cases, are carried on by what is in legal terms as well a single entity.
32 It emerges from the case-law of the Court (see in particular the judgment in Case 250/85 Brother v Council cited above, at paragraph 18) that the purpose of constructing the normal value is to determine the selling price of a product as it would be if that product were sold in its country of origin or in the exporting country and consequently it is the expenses relating to sales on the domestic market which must be taken into account, even if that product is not sold there but is sold for export. Accordingly it must be held that the institutions were right to refuse to use data relating to a market other than the domestic market of the country of origin or exporting country.
34 It should lastly be recalled, as regards the argument that the profit margin of 5% taken into account in calculating the constructed normal value for sales to OEMs is insufficient, that in ruling on a similar plea in law, also seeking the annulment of Regulation No 535/87, the Court held in the judgment in Joined Cases C-133/87 and C-150/87 Nashua Corporation v Commission and Council [1990] ECR 719, at paragraph 33, that the institutions had taken into consideration the difference between the costs and profits associated with sales to OEMs and the equivalent figures for other sales. However, because the institutions had found it impossible to gauge that difference accurately, in constructing the normal value of products sold to OEMs they set the profit margin at 5% instead of its average rate, estimated at 14.6%, applied to sales under the manufacturers' own brand names.
57 It should be noted in this connection that when the same argument was relied on by the applicant in Case C-156/87 Gestetner, cited above, the Court pointed out at paragraph 57 that, with regard to imports of PPCs supplied by Fuji Xerox from Japan, the institutions took the view that Rank Xerox had not produced evidence that it had been led to buy the machines on grounds of self-protection. According to the information obtained the decision was a management decision taken by the Xerox group of companies. However, the volume of those imports was minimal in relation to the entire range of PPCs produced by Rank Xerox within the Community and in relation to the Community market as a whole (1%), and the resale prices were the same as the prices of equivalent machines produced by Rank Xerox.
61 That argument cannot be accepted. As the Court held in its judgment in Case C-156/87 Gestetner, at paragraph 47, Olivetti and Océ imported PPCs from Japan so as to be able to offer their customers a full range of models. Those PPCs, falling within segments 1 and 2, were sold at higher prices than those charged by their suppliers and accounted for between 35 and 40% of sales and rentals of new machines placed on the market over the period from 1981 to July 1985. The attempts of both producers to develop and market a full range of models failed, however, because of the depressed market prices imposed by Japanese imports.
81 It should be borne in mind that, as the Court held in its judgment in C-156/87 Gestetner, at paragraph 63, the question whether the interests of the Community call for Community intervention involves appraisal of complex economic situations and judicial review of such an appraisal must be limited to verifying whether the relevant procedural rules have been complied with, whether the facts on which the choice is based have been accurately stated and whether there has been a manifest error of appraisal or a misuse of powers.