1. By their appeal, Ms Angé Serrano, Mr Bras, Mr Orcajo Teresa, Mr Decoutere, Mr Hau and Mr Solana Ramos request the Court to set aside the judgment of the Court of First Instance of the European Communities (now ‘the General Court’) of 18 September 2008 in Case T‑47/05 Angé Serrano and Others v Parliament [2008] ECR-SC I-A-2-0000 and II‑A-2-0000, ‘the judgment under appeal’, in which the General Court dismissed their actions against the respective decisions reclassifying them in grade (‘the contested decisions’) adopted after the entry into force of Council Regulation (EC, Euratom) No 723/2004 of 22 March 2004 amending the Staff Regulations of Officials of the European Communities and the Conditions of Employment of Other Servants of the European Communities (OJ 2004 L 124, p. 1). I - Legal context A - Relevant provisions of the Staff Regulations in the version applicable until 30 April 2004
2. Article 45(2) of the Staff Regulations of Officials of the European Communities in force until 30 April 2004 (‘the old Staff Regulations’) provide: ‘An official may be transferred from one service to another or promoted from one category to another only on the basis of a competition. ...’ B - Relevant provisions of the Staff Regulations in the version applicable from 1 May 2004
3. The old Staff Regulations were amended by Regulation No 723/2004, which came into force on 1 May 2004.
4. Article 5(1) and (2) of the Staff Regulations, in the version in force from 1 May 2004 (‘the new Staff Regulations’ or ‘the Staff Regulations’), provides: ‘1. The posts covered by the Staff Regulations shall be classified, according to the nature and importance of the duties to which they relate, in an administrators’ function group ... and an assistants’ function group ... 2. ... Function group AST shall comprise eleven grades, corresponding to executive, technical and clerical duties.’
5. Article 6(1) and (2) of the new Staff Regulations provides: ‘1. The establishment plan appended to the section of the budget related to each institution shall indicate the number of posts in each grade and function group. 2. To ensure equivalence of the average career in the career structure before 1 May 2004 (hereinafter “old career structure”) and as from 1 May 2004 (hereinafter “new career structure”) and without prejudice to the principle of promotion based on merit as laid down in Article 45 of the Staff Regulations, this plan shall ensure that for each institution, the number of vacant positions at every grade of the establishment plan on 1 January of each year corresponds to the number of officials in the lower grade in active employment on 1 January of the preceding year, multiplied by the rates laid down in Annex I, point B, for that grade. These rates shall be applied on a five-year average basis as from 1 May 2004. ...’
6. The new Staff Regulations provide for transitional arrangements which are set out in Annex XIII. The considerations which prompted the creation of those transitional arrangements are set out in recital 37 in the preamble to Regulation No 723/2004, which provides: ‘Provision should be made for transitional arrangements to enable the new rules and measures to be applied gradually, whilst respecting the acquired rights of the staff in the framework of the Community system before the entering into force of these amendments to the Staff Regulations and taking account of their legitimate expectations.’
7. Article 1 of Annex XIII to the new Staff Regulations provides: ‘1. For the period from 1 May 2004 to 30 April 2006, Article 5(1) and (2) of the Staff Regulations are replaced by the following: “1. The posts covered by the Staff Regulations shall be classified, according to the nature and importance of the duties to which they relate, in four categories A*, B*, C* and D*, in descending order of rank. 2. Category A* shall comprise twelve grades, category B* shall comprise nine grades, category C* shall comprise seven grades and category D* shall contain five grades.” 2. Any reference to the date of recruitment shall be taken to refer to the date of entry into service.’
8. Article 2(1) of Annex XIII to the new Staff Regulations provides: ‘1. On 1 May 2004, and subject to Article 8 of this Annex, the grades of officials having one of the administrative statuses set out in Article 35 of the Staff Regulations shall be renamed as follows: >lt>1 …’
9. Article 8(1) of Annex XIII to the new Staff Regulations provides: ‘1. With effect from 1 May 2006, the grades introduced by Article 2(1) shall be renamed as follows: >lt>2 …’
10. Article 10(1) to (3) of Annex XIII to the new Staff Regulations provides: ‘1. Officials in service before 1 May 2004 [in] categories C or D shall be assigned as of 1 May 2006 to career streams allowing for promotions: (a) in former category C up to grade AST 7; (b) in former category D up to grade AST 5; 2. For those officials, as of 1 May 2004 and by derogation from Annex I, Section B, to the Staff Regulations, the percentages referred to in Article 6(2) of the Staff Regulations shall be as follows: >lt>3 >lt>4 3. An official to whom paragraph 1 applies may become a member of the assistants’ function group without restriction if he passes an open competition or on the basis of an attestation procedure …’. II - Background to the dispute as described in the judgment under appeal
11. The appellants are officials of the European Parliament.
12. According to paragraph 23 of the judgment under appeal the appellants passed internal competitions for transfer from one category to another under the old Staff Regulations. Accordingly, Ms Angé Serrano transferred from grade C 1 to grade B 5; Mr Bras transferred from grade D 1 to grade C 5; Mr Decoutere transferred from grade C 3 to grade B 5; Mr Hau, member of the temporary staff in grade C 1, transferred to grade B 4; Mr Orcajo Teresa transferred from grade D 1 to grade C 5; and, lastly, Mr Solana Ramos transferred from grade C 1 to grade B 5. For all those officials, the transfer to the new grade took place before the new Staff Regulations came into force.
13. The appellants received the contested decisions during the first week of May 2004 in the form of undated letters from the Director-General of Personnel of the Parliament informing them of their intermediate grade which took effect as of 1 May 2004. As a result of those decisions, Ms Angé Serrano’s grade B 5 was renamed B*5; Mr Bras’s grade C 5 was renamed C*2; Mr Decoutere’s grade B 5 was renamed B*5; Mr Hau’s grade B 4 was renamed B*6; Mr Orcajo Teresa’s grade C 4 was renamed C*3; and Mr Solana Ramos’s grade B 4 was renamed B*6.
14. The appellants’ intermediate grades were renamed a second time with effect from 1 May 2006, that is, at the end of the transitional period instituted by the new Staff Regulations, pursuant to Article 8(1) of Annex XIII to the new Staff Regulations. Thus, Ms Angé Serrano’s intermediate grade B*5 was renamed AST 5; Mr Bras’s intermediate grade C*2 was renamed AST 2; Mr Decoutere’s intermediate grade B*5 was renamed AST 5; Mr Hau’s intermediate grade B*6 was renamed AST 6; Mr Orcajo Teresa’s intermediate grade C*3 was renamed AST 3 and Mr Solana Ramos’s intermediate grade B*6 was renamed AST 6.
15. Between 13 May and 30 July 2004, each of the appellants brought a complaint against the contested decisions inasmuch as they fixed their classification in intermediate grade as of 1 May 2004. Those complaints were rejected by decisions communicated to each of the appellants between 27 October and 25 November 2004. III - Proceedings before the General Court
16. By application lodged at the General Court Registry on 31 January 2005, the appellants brought an action seeking, first, annulment of the contested decisions and of any act resulting from and/or relating to those decisions, including those taking place after the bringing of the action and, second, an order for the Parliament to pay damages, assessed ex æquo et bono at EUR 60 000 for each applicant, without prejudice to any increase or reduction during the proceedings.
17. By order of the President of the Third Chamber of the General Court of 6 April 2005, the Council of the European Union was granted leave to intervene in support of the form of order sought by the Parliament.
18. D uring the proceedings before the General Court, the Bureau of the Parliament, by decision of 13 February 2006, approved the proposal of the Secretary-General seeking inter alia to reclassify officials who had changed their category under the old Staff Regulations, but who, as of 1 May 2004, continued to receive the basic salary of the old category. Following that decision, on 20 March 2006, individual decisions were adopted concerning Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa, whereby Ms Angé Serrano was reclassified in intermediate grade B*6, Mr Bras in intermediate grade C*4 and Mr Orcajo Teresa in intermediate grade C*4, with effect for all those officials from 1 May 2004. IV - The judgment under appeal A - Admissibility
19. In its defence before the General Court, the Parliament raised a number of pleas of inadmissibility concerning inter alia the interest in bringing proceedings of certain of the appellants. 1. Mr Decoutere’s interest in bringing proceedings
20. The Parliament contends that, if Mr Decoutere had not been transferred during 2002 from category C to category B following his success in the internal competition for change of category, his career would have advanced as follows: his grade C 3 would have been renamed C*4 as of 1 May 2004, which would in turn have been renamed AST 4 as of 1 May 2006. It follows from this that, if Mr Decoutere had not been transferred to a higher category, his grade as at 1 May 2006 would have been lower than the grade that he currently holds, that is to say, AST 5. As a result, he has no interest in challenging the contested decision reclassifying him.
21. The General Court dismissed that plea, holding that Mr Decoutere’s change of category, which resulted from success in the competition, was not reflected in his classification in intermediate grade B*5 then in grade AST 5 as of 1 May 2006. The proof of this is that, whilst Mr Decoutere, following his transfer to category B, was a grade higher than officials in grade C 1 who had not passed a competition for change of category, he was in a grade lower than those officials as of 1 May 2006, since they were then in grade AST 6 whilst he was only in grade AST 5. 2. Mr Hau’s interest in bringing proceedings
22. The Parliament contended that Mr Hau had no interest in bringing proceedings, because he was not transferred from category C to category B pursuant to Article 45(2) of the old Staff Regulations, since he was a member of the temporary staff in category C before being recruited as an official in category B following his success in an internal competition.
23. The General Court dismissed that plea, finding that, although it is established that Mr Hau was a member of the temporary staff in grade C 1 when he passed the competition for transfer from category C to category B, the Parliament allowed members of the temporary staff to have access to internal competitions for change of category. Consequently, Mr Hau was able to participate in such a competition on an equal footing with the officials in category C. Therefore, the General Court held that that competition caused him to move up the hierarchical ladder by transferring from category C to category B, on the same basis as officials who had passed that competition and had been transferred to that category. It thus found that passing the competition for change of category had not enabled Mr Hau to attain a classification in a higher grade than that of officials of the old category C who had not passed such a competition. 3. The application for annulment of the contested decisions has become devoid of purpose in relation to Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa
24. The Parliament contends that the application for annulment of the contested decisions concerning Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa has become devoid of purpose in their regard, since those decisions were annulled and replaced during the proceedings before the General Court by the individual decisions adopted on 20 March 2006 by which those appellants obtained retroactively the classification which they sought.
25. The General Court held that the decisions of 20 March 2006 did not remedy fully the objections raised by the three appellants against the contested decisions adopted in their regard inasmuch as they did not re-establish the classification in the higher grade which those appellants held under the old Staff Regulations compared with officials who had not passed the internal competition for transfer of category under those Staff Regulations.
26. The General Court nevertheless upheld the plea raised by the Parliament. It held that the decisions of 20 March 2006, without expressly providing for the withdrawal of the contested decisions, replaced them in so far as they affected the three appellants concerned, since they apply retroactively from 1 May 2004. The contested decisions concerning those three appellants thus ceased to exist in their regard from the moment that they were replaced by the decisions of 20 March 2006.
27. Consequently, according to the General Court, with regard to the three appellants above, the objective pursued by the application for annulment, that is, the cancellation of the contested decisions, was attained by the adoption and retroactive application of the individual decisions of 20 March 2006. In addition, the General Court took formal notice of the fact that the appellants acknowledged at the hearing that it was no longer necessary to give judgment on the annulment of the contested decisions relating to Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa. B - Merits 1. The application for annulment
28. In support of their application for annulment of the contested decisions, the appellants relied on a number of pleas alleging, first, the illegality of Articles 2 and 8 of Annex XIII to the new Staff Regulations, second, the infringement of the principle of sound administration and of the duty to have regard for the welfare of officials by the Parliament and, third and lastly, infringement of Articles 6, 45 and 45a of and Annex XIII to the Staff Regulations, infringement of the principle of promotion based on merit and manifest error of assessment by the Parliament.
29. In the interests of simplifying matters, it is necessary to recall only the General Court’s assessment which is challenged in this appeal.
30. In support of the plea of illegality directed against Articles 2 and 8 of Annex XIII to the new Staff Regulations, the appellants relied on infringement of acquired rights and of the principles of legal certainty, the protection of legitimate expectations and equal treatment. The appellants claimed, essentially, that the transitional measures provided for by Annex XIII to the new Staff Regulations did not solve their problem, namely, the demotion which they consider that they have suffered in their careers, nor did it protect their acquired rights to classification in a grade higher than that of officials who had not passed internal competitions for change of category under the old Staff Regulations.
31. With regard to acquired rights, the General Court recalled that an official cannot claim such a right unless the facts giving rise to that right arose under a particular set of Staff Regulations prior to their amendment (Case 28/74 Gillet v Commission [1975] ECR 463, paragraph 5). In a system such as that of the Community civil service, in which the hierarchy between officials is subject to alterations, the General Court pointed out that the classification in a higher grade which, at a given moment in their career, certain officials held vis-à-vis others does not constitute an acquired right which must be protected by the provisions of the Staff Regulations in force after 1 May 2004.
32. However, according to the General Court, officials who passed an internal competition for change of category before that date are entitled to expect the Staff Regulations to offer them better career prospects than those offered to officials who have not passed such a competition under the old Staff Regulations and such prospects constitute acquired rights which must be protected under the new Staff Regulations. In fact, it does not necessarily follow from the reclassification criteria laid down in Articles 2 and 8 of the Annex to the new Staff Regulations that the career prospects of officials who have passed such a competition are no better than those which can be expected by those officials who failed that competition. On the contrary, Annex XIII to the new Staff Regulations, and in particular Article 10 thereof, contains provisions which differentiate officials according to the category to which they belonged before 1 May 2004, providing for possibilities of career advancement which vary according to the category to which they belonged under the old Staff Regulations.
33. With regard to the breach of legitimate expectations, the General Court held that an official cannot rely on the principle of the protection of legitimate expectations in order the challenge the legality of a new regulatory provision, in a field in which the legislature enjoys a wide discretion (Case T‑30/02 Leonhardt v Parliament [2003] ECR‑SC I-A-41 and II‑265, paragraph 55). Such is the case as regards the alteration of the system of careers of officials and as regards the adoption of the transitional rules accompanying that alteration, including the rules on classification in grade contained in Articles 2 and 8 of Annex XIII to the new Staff Regulations.
34. Concerning the objection alleging infringement of the principle of legal certainty, the General Court held that the appellants’ documents do not show how that principle was infringed in Articles 2 and 8 of Annex XIII to the new Staff Regulations and that, in any event, that objection is manifestly unfounded since the officials are not entitled to the maintenance of the Staff Regulations as they existed at the moment of their recruitment ( Leonhardt v Parliament , paragraph 55).
35. In support of the objection alleging infringement of the principle of equal treatment, the appellants claim that, following the new classification in grade, officials in a lower category than the appellants were, as of 1 May 2006, transferred to a grade higher or equal to theirs. In addition, Mr Decoutere was classed differently from officials who had passed the same competition.
36. The General Court confirmed in that regard that the classification of officials who passed an internal competition for change of category before 1 May 2004 in a grade lower or equal to officials who failed such a competition does not constitute an infringement of the principle of equal treatment. In the light of the radical alteration to the system of careers, the comparison of the hierarchical rank of officials before and after that date is not in itself decisive for the purpose of finding an infringement of the principle of equal treatment in Articles 2 and 8 of Annex XIII to the new Staff Regulations. In any event, through the very provisions they claim to be unlawful, the successful candidates in the competition for change of category secured better prospects for the advancement of their careers.
37. Moreover, concerning the second part of this plea, that is, the situation of Mr Decoutere who claims to have been unfairly given different treatment from the other successful candidates in the same competition, the General Court found that the other candidates had been recruited as officials under the new Staff Regulations and that, accordingly, Mr Decoutere and those officials were in a different legal situation. 2. The claim for damages
38. In support of their claim for damages, the appellants claimed that, following any annulment of the contested decisions, their alleged material and non-material loss must be compensated by paying them all sums that they would have received if they had been classified in the grade which in fact corresponds to their duties.
39. The General Court examined separately the applications of Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa, on the one hand, and of Mr Decoutere, Mr Hau and Mr Solana Ramos, on the other.
40. Concerning the first group of officials, the General Court held that, leaving aside the alleged illegality of the contested decisions concerning those officials, on which it did not rule, at least one of the conditions necessary for rendering the institutions liable was lacking. With regard to the alleged material loss, it held that the reclassification that took place because of the decisions adopted during the judicial proceedings did not entail any increase in the salary received under the intermediate grades and that, in those circumstances, the appellants had not established the existence of the material loss pleaded. Moreover, concerning the alleged non-material loss, the General Court noted that, in adopting the contested decisions, the Parliament had merely applied Article 2(1) of Annex XIII to the new Staff Regulations in respect of the appellants and that, in those circumstances, the principle of sound administration and the duty to have regard for the welfare of officials had not been infringed. Lastly, it stated that the Parliament, in adopting and applying retrospectively the decisions of 20 March 2006, had allowed those appellants to attain higher grades than those in which they were classified by the contested decisions.
41. As to the second group of appellants, the General Court held that, in the present case, there is a close link between the application for annulment and the application for compensation to make good the material and non‑material loss suffered as a result of their intermediate classification. The pleas relied on in support of the application for annulment having been rejected, it followed that the Parliament had not committed any unlawful act liable to render the European Community liable in respect of the three appellants. V - Forms of order sought
42. By their appeal, the appellants claim that the Court should: - declare their appeal admissible and well founded and, accordingly; - as regards Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa, set aside the judgment under appeal, first, in so far as it holds that there is no need to adjudicate with respect to them as regards their first head of claim and, secondly, in so far as it dismisses their claim for damages; and - as regards Mr Decoutere, Mr Hau and Mr Solana Ramos, set aside points 2 and 4 of the operative part of the judgment under appeal dismissing their application and ordering them to bear their own costs, and the grounds relating thereto.
43. The appellants also claim that the Court should give judgment in the dispute and, declaring the appellants’ initial action in Case T‑47/05 well founded: - annul the decisions concerning the appellants’ classification in grade following the entry into force of the new Staff Regulations; - order the Parliament to pay damages, assessed ex æquo et bono at EUR 60 000 for each appellant; and - order the Parliament to pay the costs, in any event.
44. They claim that the Court should, in any event, order the Parliament to pay the costs of both sets of proceedings.
45. In its defence, the Parliament also introduced a cross appeal. It contends that the Court should: - declare the cross appeal admissible and well founded and, consequently set aside the judgment under appeal in so far as it rejects the claims for a declaration of the inadmissibility of the actions of Mr Decoutere and Mr Hau; - dismiss the appeal as unfounded for the remainder; and - order the appellants to pay the costs of the present instance.
46. The Council contends that the Court should: - dismiss the appeal as unfounded; and - order the appellants to pay the costs. VI - The appeal
47. In their main appeal, the appellants rely on two different sets of grounds. The first set concerns the General Court’s assessment of whether the applications of Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa are admissible and well founded. The second group concerns the General Cour t’s assessment of whether the applications of Mr Decoutere, Mr Hau and Mr Solana Ramos are admissible and well founded.
48. In its cross appeal, the Parliament challenges the part of the judgment under appeal concerning the dismissal of the plea of inadmissibility of the action which it raised at first instance and that concerning the lack of interest in bringing proceedings of Mr Decoutere and Mr Hau. A - The part of the judgment under appeal concerning Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa 1. The part of the judgment under appeal concerning the finding that there was no need to adjudicate on the application for annulment a) Arguments of the parties
49. The appellants rely on two grounds, alleging, respectively, that the General Court erred in law and that it stated insufficient and contradictory reasons for the judgment under appeal.
50. They claim that, in accordance with the case‑law of the Court of Justice, in cases comparable to those at issue, where a contested act is replaced in the course of the proceedings, the appellants’ interest in bringing proceedings may be maintained because of the risk that the allegedly unlawful action of a Community institution will be repeated. In that regard, the appellants rely in particular on Case 53/85 AKZO Chemie and AKZO Chemie UK v Commission [1986] ECR 1965, paragraph 21, and Case 207/86 Apesco v Commission [1988] ECR 2151, paragraph 16. According to them, an appellant’s interest in bringing proceedings may also be maintained as a result of his interest in obtaining compensation for the damage caused by a decision which is no longer in force. In that regard, they rely in particular on Case 76/79 Könecke Fleischwarenfabrik v Commission [1980] ECR 665, paragraph 9; Joined Cases C‑68/94 and C‑30/95 France and Others v Commission [1998] ECR I‑1375, paragraph 74; and Case C‑362/05 P Wunenburger v Commission [2007] ECR I‑4333, paragraph 42.
51. They further state that, in the present case, the decisions reclassifying them adopted in the course of proceedings before the General Court do not fully remedy the objections raised at first instance, in particular in respect of the illegality of Articles 2 and 8 of Annex XIII to the new Staff Regulations, and remain prejudicial to their rights in part by reason of their failure to respect the principle of equal treatment, their acquired rights and legal certainty. Not only do those decisions fail to withdraw formally and expressly the contested decisions relating to the appellants concerned, but they also fail to re-establish the classification in the higher grade which those appellants enjoyed under the old Staff Regulations and which they lost because of the application of the contested decisions.
52. The Parliament counters that, according to the case‑law of the Court upon which the appellants rely, that objective of the action must continue, like the interest in bringing proceedings, during the proceedings and the result of the action must be liable to procure an advantage to the party bringing it ( Wunenburger v Commission , paragraph 42). That is not the case here. First, the new decisions have the same objective as the contested decisions, which they replace ex tunc , and, second, the General Court can only annul the decisions and may not replace them itself, on behalf of the institution. Moreover, there is no risk of repetition of the allegedly unlawful action because the new decisions have altered the system of classification.
53. The Parliament further states that, as is apparent from the judgment under appeal, during the hearing the appellants concerned acknowledged that they no longer had an interest in the General Court giving a decision on the annulment of the contested decisions relating to them. Nor did the appellants reformulate their claims during the proceedings before the General Court to challenge the decisions of 20 March 2006, which replaced the contested decisions.
54. Lastly, as to the consequences of the case not proceeding to judgment with regard to the claim for damages, the Parliament maintains that the General Court decided to examine, independently of the assessment of the lawfulness of the contested decisions, whether the two other cumulative conditions for rendering the European Community liable were met and found that the appellants had not, in any event, established the existence of material and non-material loss. b) Findings of the Court
55. It follows from paragraph 90 of the judgment under appeal, which in this respect is not challenged by the appeal, that the appellants, having agreed that it was no longer necessary for the General Court to give judgment on their application for annulment, must be considered to have withdrawn that head of claim. Thus, no longer having that part of the claim before it, the General Court could only take formal notice of the declaration made during the hearing. Moreover, as the Parliament observed in its defence, nor have the appellants tried to reformulate the claims put before the General Court by challenging the decisions of 20 March 2006. The appellants have, on the contrary, favoured the course of bringing an action against those decisions before the European Union Civil Service Tribunal.
56. As that finding is sufficient on its own to justify the judgment under appeal on that point, that ground of appeal must be considered to be unfounded. 2. The dismissal of the claim for damages a) Arguments of the parties
57. In support of their ground of appeal directed against the General Court’s rejection of their claim for damages, Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa rely on the alleged insufficiency of the reasons stated for the judgment under appeal concerning the non-material loss that they claim to have suffered. According to them, the objections put forward in their originating application with regard to their claim for damages are, in that regard, much wider-ranging than those assessed by the General Court in the judgment under appeal and also relate to the state of uncertainty in which they were placed and the repercussions on their career as well as on their professional and family life. However, the extremely summary assessment of that head of claim by the General Court does not take into account the new elements of loss relating to the adoption of the new classification decisions. The replacement of the contested decisions during the proceedings in no way constituted adequate and sufficient compensation for the non‑material loss suffered by the three appellants because they remain in a state of anxiety and uncertainty as to the development of their careers.
58. The Parliament notes that the appellants make no distinction between the loss allegedly suffered which was caused by the contested decisions and the loss which, according to them, continues, following their reclassification in grade by the decisions replacing the contested decisions. In the present case, even if the loss were continuing, it would have been impossible for the General Court to analyse that loss without examining the substance of the new decisions on the classification in grade of those three appellants. In any event, according to the Parliament, following those reclassification decisions, the appellants progressed in their respective careers. b) Findings of the Court
59. In paragraph 168 of the judgment under appeal, the General Court pointed out, as a preliminary point, that in the context of a claim for damages brought by an official, the Community can be held liable only if a number of conditions are satisfied as regards the illegality of the alleged wrongful act committed by the institution concerned, the harm actually suffered, and the existence of a causal link between the alleged act of the institution and the damage alleged to have been suffered. Similarly, in paragraph 169 of the judgment, it pointed out that those three conditions for Community liability are cumulative, which implies that, if any one of them is not satisfied, the Community cannot be liable.
60. With regard to the non‑material loss alleged by Ms Angé Serrano, Mr Bras and Mr Orcajo Teresa, resulting from the alleged infringements of the principle of sound administration and of the duty to have regard for the welfare of officials by the Parliament, the General Court held inter alia, in paragraph 175 of the judgment under appeal, that the Parliament, in simply basing the contested decisions on the provisions of the Staff Regulations, had not infringed that principle or that duty, and went on to find that the illegality of the act alleged to be at the origin of the non‑material loss allegedly suffered had not been established in the present case.
61. The General Court thus stated, to the requisite legal standard, reasons for rejecting the claim for compensation for the non‑material loss. The mere finding by the General Court that the alleged illegality of the act had not been established was sufficient to justify the rejection of the application on the ground that one of the three cumulative conditions recalled in paragraph 169 of the judgment under appeal was not met. Accordingly, the General Court was not obliged to state further reasons before giving its judgment, by making additional findings as to the existence of alleged non‑material damage.
62. Thus, that ground of appeal must be considered to be unfounded. B - The part of the judgment under appeal concerning Mr Decoutere, Mr Hau and Mr Solana Ramos 1. Admissibility of the action brought by Mr Decoutere and Mr Hau a) Arguments of the parties
63. In its cross appeal, the Parliament states in relation to Mr Decoutere that he was classified in grade B after his success in the competition for change of category and that, therefore, he was in an identical situation to all officials in grade B of the old Staff Regulations when the new Staff Regulations entered into force. The Parliament contends that, contrary to what the General Court held, Mr Decoutere was classified, before the internal competition for change of category, in grade C 3 and, after taking part in that competition, in grade B 5, then B*5 and lastly in AST 5. Following those promotions, he is currently in grade AST 7. Mr Decoutere was thus reclassified, under the system of the new Staff Regulations, taking account of his classification in grade B and not in grade C of the old Staff Regulations. The Parliament contends, in essence, that, after the new Staff Regulations entered into force, Mr Decoutere had the same career advancement as officials who attained grade B under the old Staff Regulations and, accordingly, has not been discriminated against compared with those officials.
64. With regard to Mr Hau, the Parliament contends that the General Court incorrectly found that he was in the same situation as the other appellants. At the time when he took part in the competition, he was a member of the temporary staff and, on passing that competition, rather than advancing to a higher category, he underwent a change of status from that of a member of the temporary staff to that of an official. The General Court defined Mr Hau’s situation incorrectly, because, following his success in the competition for change of category, he benefited not from an advance in grade, but from a change of status under the Staff Regulations.
65. The appellants claim that the Parliament confines itself to reproducing arguments already presented at first instance and to calling into question the findings of fact. The ground of appeal must be considered to be inadmissible. As to the substance, it considers that the reasons stated in the judgment under appeal concerning the rejection of the plea of inadmissibility are correct. b) Findings of the Court
66. As regards Mr Decoutere, in paragraphs 68 to 70 of the judgment under appeal, the General Court dismissed the plea of inadmissibility raised at first instance by the Parliament, finding that Mr Decoutere had an interest in bringing proceedings. It found that Mr Decoutere, who was transferred from grade C 3 to grade B 5, was, on 1 May 2006, in a lower grade than officials in grade C 1 who had not passed the competition for change of category under the old Staff Regulations.
67. In that regard, it is clear that the General Court did not err when it stated in paragraphs 68 to 70 of the judgment under appeal that the objection which Mr Decoutere made at first instance concerns the fact that his classification, established according to the rules of the new Staff Regulations, does not reflect the advancement to a higher category resulting from success in the competition, and that, consequently, it concerns the alleged failure to take into account his success in the competition in the light of the classification of Mr Decoutere’s colleagues who were in the same category under the old Staff Regulations and who did not pass that competition.
68. As held by the General Court, Mr Decoutere was principally challenging an alteration in the hierarchical relations under the old Staff Regulations allegedly brought about by the transitional classification rules of Annex XIII to the new Staff Regulations.
69. It follows that, inasmuch as the contested decision concerning Mr Decoutere does not satisfy him in relation to that objection, the General Court rightly dismissed the Parliament’s plea of inadmissibility.
70. Therefore, that ground of the cross appeal is unfounded.
71. As regards Mr Hau, the General Court found that he participated as a member of the temporary staff in the competition for change of category on an equal footing with officials and, following the contested decision concerning him, lost the classification in a higher grade than that of the officials in the old category C who had not passed such a competition. He thus had an interest in bringing proceedings.
72. The Parliament’s arguments as to the admissibility of Mr Hau’s action relate not to his interest in bringing proceedings and, consequently, to the admissibility of his action, but to whether that action is well founded and in particular whether, following his success in the competition for change of category, he is entitled to receive different treatment in the advancement of his career from that applied to officials classified in grade C before the new Staff Regulations entered into force. Those arguments thus do not call into question the admissibility of the action which he has brought.
73. Therefore, the General Court rightly held that Mr Hau’s action was admissible.
74. It follows from all the foregoing that the grounds of the cross appeal must be rejected and that that appeal must be dismissed in its entirety. 2. The dismissal of the plea of illegality concerning Articles 2 and 8 of Annex XIII to the new Staff Regulations a) The grounds of appeal alleging infringement of acquired rights i) Arguments of the parties
75. The appellants claim that, contrary to the finding of the General Court, on insufficient grounds, the cancellation of the old classification in grade by the new Staff Regulations constitutes an infringement of acquired rights. Their appointment to a higher grade is in fact equivalent to a promotion taking place before the reform the Staff Regulations. Similarly, the appellants challenge the assessments made by the General Court in paragraphs 113 to 118 of the judgment under appeal, relating to the alleged better career prospects compared with officials who did not pass such a competition. They further claim that, unlike the situation of the appellants in Case C‑443/07 P Centeno Mediavilla and Others v Commission [2008] ECR I‑0000, who were not officials when the new Staff Regulations entered into force and who accordingly had no prospect of being appointed officials, the appellants in the present case were already officials and had passed an internal competition for change of category, which constituted the event giving rise to their acquired right to a higher grade.
76. In that regard, the Parliament contends that the appellants, even after the new Staff Regulations entered into force, advanced in their careers more rapidly than their colleagues who had not passed such internal competitions for change of category. Therefore, the entry into force of the new Staff Regulations in no way adversely affected their rights.
77. The Council contends that the factual and legal situation of a group of officials, defined in relation to that of another group of officials and not in absolute terms, is not sufficiently stable and definitive to be regarded as an acquired right. Moreover, the hierarchy between officials will always be subject to alterations and career prospects will always be subject to chance to a certain extent. That is why it is not possible in this field to rely on acquired rights. The Council thus considers that the General Court, in finding that the appellants had an acquired right to the advancement of their careers, reached an erroneous conclusion. The appellants’ situation was, at the time of the reform of the Staff Regulations, vaguely defined and could not have constituted a right limiting the wide discretion of the legislature, as acknowledged by the Court in Centeno Mediavilla and Others v Commission . ii) Findings of the Court
78. At paragraph 107 of the judgment under appeal, the General Court held inter alia that the classification in a higher grade from which, at a given moment in their career, certain officials benefited vis-à-vis others does not constitute an acquired right which must be protected by the provisions of the new Staff Regulations.
79. In paragraph 109 of the judgment under appeal, it was found, moreover, that, before the new Staff Regulations entered into force, Mr Decoutere, Mr Hau and Mr Solana Ramos, after passing the internal competitions for change of category, advanced in their careers. They were thus placed in a higher grade than officials who had not succeeded, after such an internal competition, in advancing to a higher category.
80. On the basis of that finding, the General Court held, in paragraph 110 of the judgment under appeal, that the better career prospects acquired by the appellants under the old Staff Regulations compared with officials not having passed the same competitions constitute acquired rights which must be protected under the new Staff Regulations.
81. Next, in paragraphs 114 to 117 of the judgment under appeal, it stated that, because of the promotion rules set out in Article 10 of Annex XIII to the Staff Regulations, the legislature has provided for mechanisms differentiating the careers of officials according to the category to which they belonged under the old Staff Regulations. The General Court held that those rules made it possible to ensure respect for acquired rights.
82. According to the case-law of the Court of Justice the legal link between an official and the administration is based upon the Staff Regulations and not upon a contract. Thus, the rights and obligations of officials may, subject to compliance with the requirements of Community law, be altered at any time by the legislature ( Centeno Mediavilla and Others v Commission , paragraph 60 and the case-law cited).
83. It is well established that amending legislation, such as the regulations amending the Staff Regulations, applies, unless otherwise provided, to the future consequences of situations that arose under the previous legislation (see, to that effect, Case C-60/98 Butterfly Music [1999] ECR I-3939, paragraph 24, and Centeno Mediavilla and Others v Commission , paragraph 61).
84. That is so except for situations originating and becoming definitive under the previous legislation which create acquired rights (see, to this effect, Case 68/69 Brock [1970] ECR 171, paragraph 7; Case 143/73 SOPAD [1973] ECR 1433, paragraph 8; Case 270/84 Licata v ESC [1986] ECR 2305, paragraph 31 and Centeno Mediavilla and Others v Commission , paragraph 62). A right is considered to be acquired when the event giving rise to it occurred before the legislative amendment (see Centeno Mediavilla and Others v Commission , paragraph 63).
85. In the present case, it must be held that the appellants, who advanced in their careers because they passed the internal competition, have acquired the right to have the advance thus made under the old Staff Regulations acknowledged. However, contrary to what they claim, such a right implies merely that they should receive the same treatment under the Staff Regulations, concerning in particular career advancement, as that given to all the officials of the new grade that they have thus attained.
86. The legislature’s wide discretion to make the amendments to the Staff Regulations needed on the conditions set out in paragraphs 82 and 83 above and in particular to alter the structure of the grades of officials cannot authorise it to make amendments which, among other things, are unconnected with that need or which do not take into account the competences which those grades are supposed to reflect. However, the legislature cannot, on the other hand, be bound by a requirement to maintain strictly the relationship which had hitherto existed between those grades before the amendment of the Staff Regulations.
87. Therefore, the appellants cannot properly invoke alleged acquired rights to be classified in a higher grade obtained under the old Staff Regulations in order to claim that Articles 2 and 8 of Annex XIII to the new Staff Regulations are vitiated by illegality.
88. In those circumstances, and although, as the General Court observed in paragraph 114 of the judgment under appeal, the legislature adopted, in those new Staff Regulations, provisions which differentiate the career advancement of those officials by taking account of the category to which they belonged under the old Staff Regulations, the appellants are not justified in maintaining that the General Court, which stated sufficient reasons for its assessment, erred in law in dismissing their plea alleging infringement of acquired rights. b) The ground alleging infringement of the principle of the protection of legitimate expectations i) Arguments of the parties
89. Concerning infringement of the principle of the protection of legitimate expectations, the appellants claim that the General Court, erroneously and on insufficient grounds found that they could not have a legitimate expectation that an existing situation would be maintained in the absence of acquired rights. The scope of those two principles is distinct because the source of the principle of the protection of legitimate expectations is different from the acquisition of such rights. Moreover, unlike the appellants in Centeno Mediavilla and Others v Commission , the appellants in the present case based their expectations of career advancement on success in a competition for change of category and, accordingly, on a situation acquired before the new Staff Regulations entered into force. To accept that the legislature was not obliged to take account of such an expectation would amount to placing it above the general principle of the protection of legitimate expectations.
90. In that regard, the Council contends that the appellants’ career prospects do not constitute a sufficiently stable situation to be considered to have been an acquired right. It recalls, moreover, that, according to Centeno Mediavilla and Others v Commission , individuals cannot rely on that principle in order the challenge the legality of a new regulatory provision relating to the Community civil service. ii) Findings of the Court
91. In paragraph 121 of the judgment under appeal, the General Court, for the reasons recalled in paragraph 34 above, held that the appellants could not rely on the principle of the protection of legitimate expectations in order to challenge a provision of the Staff Regulations.
92. That assessment, for which sufficient reasons were stated, of the scope of the principle of the protection of legitimate expectations does not appear to be vitiated by error of law.
93. Individuals cannot rely on the principle of the protection of legitimate expectations in order to oppose the application of a new legislative provision, especially in a sphere in which the legislature enjoys a considerable degree of latitude (Case C‑284/94 Spain v Council [1998] ECR I‑7309, paragraph 43 and Centeno Mediavilla and Others v Commission , paragraph 91).
94. It follows that the appellants’ arguments concerning the infringement of the principle of the protection of legitimate expectations are unfounded. c) The ground alleging infringement of the principle of equal treatment i) Arguments of the parties
95. According to the appellants, the General Court erred in its interpretation of the principle of equal treatment by holding that, even if the contested decisions caused them to suffer loss in terms of their career progress compared with that of their colleagues who had not passed the internal competition for change of category, that could not result in infringement of that principle. The General Court thus accepted, on insufficient grounds, that different situations could be treated identically. Moreover, it erred in finding that the transitional rules at issue were capable of meeting the requirements for compliance with that principle.
96. Furthermore, in respect of Mr Decoutere’s situation, the General Court wrongly refused to censure the fact that, on the basis in particular of Articles 2(1), (4) and (5) of Annex XIII to the new Staff Regulations, he was treated differently from officials who had passed the same competition and who were thus in the same legal situation as him.
97. The Parliament and the Council contend that the General Court rightly held that the careers system was radically altered by the new Staff Regulations, but that that system made provision for advantages for officials who were classified in a higher grade before the new Staff Regulations entered into force. The Council states, moreover, that the classification in the new hierarchical system is not in itself conclusive for the purpose of assessing whether the legislature took account of the differences, in terms of career prospects, between the officials who had passed a competition for change of category under the old Staff Regulations and those who had not.
98. As regards Mr Decoutere’s situation, the Parliament and the Council state that the interpretation of the provisions at issue by the General Court was confirmed by Centeno Mediavilla and Others v Commission , in which the Court held that officials appointed on two different dates could not be considered to be in the same legal situation. ii) Findings of the Court
99. As is clear from the Court’s settled case-law, a breach of the principle of equal treatment, applicable to the law relating to the employment of Community officials, occurs when two categories of person whose factual and legal circumstances disclose no essential difference are treated differently at the time of their recruitment and that difference in treatment is not objectively justified (see Case C-459/98 P Martínez del Peral Cagigal v Commission [2001] ECR I‑135, paragraph 50 and Centeno Mediavilla and Others v Commission , paragraph 76).
100. It is also well established that, in adopting applicable rules, especially in the sphere of the Community civil service, the Community legislature is obliged to observe the general principle of equal treatment ( Centeno Mediavilla and Others v Commission , paragraph 78).
101. As the General Court correctly pointed out in paragraph 142 of the judgment under appeal, it is also settled case‑law that the principle of equality is infringed where two different situations are treated identically (see, to that effect, Case C‑227/04 P Lindorfer v Council [2007] ECR I‑6767, paragraph 63).
102. In that regard, the General Court held, in paragraph 145 of the judgment under appeal, that the appellants who have passed an internal competition for change of category under the old Staff Regulations are not in the same factual and legal situation as officials who have not passed such a competition. It held, moreover, in paragraphs 146 and 147 of the judgment under appeal, that the former had, under the rules of the Staff Regulations, better career prospects than the latter, account of which had been taken in the transitional provisions of Annex XIII to the new Staff Regulations.
103. Contrary to what the appellants claim, such an assessment, for which, as pointed out in paragraph 37 above, sufficient reasons were stated, is not vitiated by any error of law.
104. The appellants restricted themselves to claiming that the transitional arrangements at issue do not include provisions that specifically concern the category of officials who have passed a competition under the old Staff Regulations and that, in any event, the better career prospects which they enjoyed under the new Staff Regulations are neither substantial nor certain.
105. That reasoning is not such as to establish that those new Staff Regulations infringed the principle of equal treatment with regard to those officials. As follows from paragraph 86 above, since, by adopting new Staff Regulations, the Community legislature remodelled the entire system of careers then in force, it cannot be required to reproduce identically the hierarchy of grades under the old Staff Regulations, without adversely affecting the possibility that they have of making alterations to the Staff Regulations. In that context, the comparison of hierarchical ranks before and after the reform of the Staff Regulations is not, in itself, conclusive for assessing whether the new Staff Regulations comply with the principle of equal treatment.
106. The new Staff Regulations, contrary to what the appellants claim, make a distinction between the careers of officials belonging, under the old Staff Regulations, to various grades in the hierarchy and ensures, for those who have passed a competition for change of category, different career prospects from those of officials who have not passed the same competition. In particular, the transitional arrangements and Article 10(1) and (2) of Annex XIII to the Staff Regulations especially, ensure, through the rule on the blocking of career advancement and the rule on fixing rates of promotion for the different grades, better career prospects for officials in higher grades under the arrangements of the old Staff Regulations and, accordingly, to those who have advanced in the grades after passing a competition for change of category.
107. Lastly, with regard to Mr Decoutere, the General Court held, in paragraphs 152 to 155 of the judgment under appeal, that that appellant was not in the same legal situation as another official who had taken the same competition as him, but had been recruited as an official under the new Staff Regulations, whereas Mr Decoutere had been recruited and classified in a new grade after that competition under the old Staff Regulations. That being the case, the General Court had not erred in law and had stated reasons for the judgment under appeal to the requisite legal standard.
108. Two officials who are reclassified in a higher grade under different rules of the Staff Regulations are, accordingly, in different situations (see, by analogy, Centeno Mediavilla and Others v Commission , paragraphs 79 and 80).
109. It follows from all of the considerations above that the appellants are not justified in claiming that the General Court erred in rejecting the plea of illegality in respect of Articles 2 and 8 of Annex XIII to the new Staff Regulations and that insufficient grounds were stated for the judgment. 3. The dismissal of the claim for damages
110. To the extent that the appellants refer to their arguments concerning the part of the judgment under appeal dealing with that plea of illegality in order also to challenge paragraphs 177 to 180 of the judgment under appeal concerning the claim for damages, that ground of the main appeal must also be considered to be unfounded.
111. As none of the pleas relied on by the appellants is well founded, the main appeal must be dismissed. VII - Costs
112. In accordance with the first paragraph of Article 122 of the Rules of Procedure of the Court of Justice, where the appeal is unfounded, the Court is to make a decision as to costs.
113. Under Article 69(2) of those Rules, which apply to the procedure on appeal by virtue of Article 118, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. In accordance with Article 69(3) of those Rules, where each party succeeds on some and fails on other heads, or where the circumstances are exceptional, the Court may order that the costs be shared or that the parties bear their own costs. Since both the appellants and the Parliament have been unsuccessful in their respective grounds of appeal, each party must be ordered to bear its own costs.
114. In accordance with Article 69(4) of the Rules of Procedure of the Court of Justice, which is also applicable by virtue of Article 118, the institutions that intervene in the proceedings are to bear their own costs. The Council must therefore be ordered to bear its own costs.