P & O European Ferries (Vizcaya) SA (C-442/03 P) and Diputación Foral de Vizcaya (C-471/03 P) v Commission of the European Communities.
Date: 2006-06-01
41. Contrary to the view taken by the Court of First Instance, the BAI  v Commission  judgment did not only have relative authority preventing merely new actions from being brought with the same subject-matter, between the same parties and based on the same grounds. That judgment was invested with the force of res judicata  with absolute effect and prevented legal questions which it had already settled from being referred to the Court of First Instance for re-examination.
42. In the BAI v Commission  judgment the Court of First Instance annulled the decision of 7 June 1995 in which the Commission held that the new agreement did not constitute State aid and consequently decided to terminate the review procedure which had been initiated in respect of the aid granted to Ferries Golfo de Vizcaya.
43. That annulment led retroactively to the disappearance of the decision of 7 June 1995 with regard to all persons. An annulling judgment of that nature thus has authority erga omnes , which gives it the force of res judicata  with absolute effect (see, in particular, Case 1/54 France  v High Authority  [1954] ECR 1, or p. 17, 34; Case 2/54 Italy  v High Authority [1954] ECR 37, at p. 55; Case 3/54 Assider  v High Authority  [1955] ECR 63; and Case C-310/97 P Commission  v AssiDomän Kraft Products and Others  [1999] ECR I-5363, paragraph 54).
44. That authority is not attached only to the operative part of the BAI  v Commission  judgment. It is also attached to the ratio decidendi  of that judgment which is inseparable from it (see, to that effect, Joined Cases 97/86, 193/86, 99/86 and 215/86 Asteris and Others  v Commission  [1988] ECR 2181, paragraph 27, and Commission  v AssiDomän Kraft Products and Others , paragraph 54).
45. In addition, the question of the force of res judicata  with absolute effect is a matter of public policy, which must, consequently, be raised by the Court of its own motion.
47. No appeal was lodged against the BAI  v Commission  judgment, and its operative part and ratio decidendi  therefore became final.
60. First, as regards the admissibility of the fifth ground of appeal adduced in Case C-471/03 P, the Diputación, contrary to the Commission’s submissions, did not confine itself to reproducing the terms used in the pleadings which it submitted to the Court of First Instance. That ground contains a precise and detailed criticism of the grounds of the judgment under appeal, in particular paragraph 58 of that judgment. In addition, it concerns the distortion of the facts of the dispute by the Court of First instance and can thus not have been raised before that court. Second, while the assessment of the facts does not constitute a point of law, subject as such to review by the Court of Justice in the context of an appeal, that rule does not apply when the clear sense of the evidence submitted to the Court of First Instance has been distorted. The Court of Justice is thus entitled to censure a distortion by the Court of First Instance of the evidence before it, in particular where that court substitutes its own reasoning for that of the contested decision (see, to that effect, Case C-164/98 P DIR International Film and Others  v Commission  [2000] ECR I-447, paragraphs 48 and 49).
67. Therefore, by considering, in paragraph 58 of the judgment under appeal, that ‘the original agreement and the new agreement constitute a single grant of aid, instituted and implemented in 1992 in the context of the original agreement’s conclusion without prior notification of the Commission’, and in paragraph 74 of that judgment that ‘the procedure initiated on 29 September 1993 and terminated by the decision of 7 June 1995 concerned solely the original agreement’, the Court of First Instance distorted the facts of the case and the content of the contested decision, substituting its own reasoning for that in the contested decision (see, to that effect, DIR International Film and Others  v Commission , paragraphs 48 and 49).
90. The classification of an act or a measure for legal purposes by the Court of First Instance is a question of law which may be raised in an appeal. That is true, for example, of the question whether a letter must be regarded as a complaint within the meaning of Article 90(2) of the Staff Regulations of Officials of the European Communities (see, to that effect, Case C-19/93 P Rendo and Others  v Commission  [1995] ECR I-3319, paragraph 26, and Case C-154/99 P Politi  v European Training Foundation  [2000] ECR I-5019, paragraph 11).
133. It follows from the above considerations taken as a whole that the Court of First Instance vitiated its judgment by erring in law and distorting the facts of the case in so far as it, contrary to the force of res judicata  with absolute effect resulting from the BAI  v Commission  judgment, examined the ground of appeal alleging infringement of Article 87(1) EC and in so far as it held that the new agreement and the original agreement constituted a single grant of aid, implemented in 1992.
134. Since that error of law and that distortion of the facts of the case do not, however, affect the operative part of the judgment under appeal, it need not be annulled.