1 BY AN APPLICATION LODGED AT THE COURT REGISTRY ON 21 DECEMBER 1979 , ROBERT ADAM , AN OFFICIAL OF THE COMMISSION EMPLOYED AT THE ISPRA JOINT RESEARCH CENTRE , ITALY , BROUGHT AN ACTION PURSUANT TO ARTICLE 91 OF THE STAFF REGULATIONS OF OFFICIALS ( HEREINAFTER REFERRED TO AS ' ' THE STAFF REGULATIONS ' ' ) FOR ANNULMENT OF THE COMMISSION ' S DECISION FIXING THE APPLICANT ' S REMUNERATION FOR APRIL 1979 AND OF THE REJECTION OF THE COMPLAINT LODGED BY HIM AGAINST THAT DECISION .
2 ARTICLES 63 AND 64 OF THE STAFF REGULATIONS IN THE VERSION IN FORCE UNTIL THE END OF 1978 PROVIDED : ' ' AN OFFICIAL ' S REMUNERATION SHALL BE EXPRESSED IN BELGIAN FRANCS . IT SHALL BE PAID IN THE CURRENCY OF THE COUNTRY IN WHICH THE OFFICIAL PERFORMS HIS DUTIES . REMUNERATION PAID IN A CURRENCY OTHER THAN BELGIAN FRANCS SHALL BE CALCULATED ON THE BASIS OF THE PAR VALUES ACCEPTED BY THE INTERNATIONAL MONETARY FUND . . . ON 1 JANUARY 1965 . AN OFFICIAL ' S REMUNERATION EXPRESSED IN BELGIAN FRANCS SHALL . . . BE WEIGHTED AT A RATE ABOVE , BELOW OR EQUAL TO 100% , DEPENDING ON LIVING CONDITIONS IN THE VARIOUS PLACES OF EMPLOYMENT . . . . THE WEIGHTING APPLICABLE TO THE REMUNERATION OF OFFICIALS EMPLOYED AT THE PROVISIONAL SEATS OF THE COMMUNITIES SHALL BE EQUAL TO 100 % AS AT 1 JANUARY 1962 ' ' .
3 IN ACCORDANCE WITH ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS AN OFFICIAL MAY HAVE PART OF HIS EMOLUMENTS TRANSFERRED EITHER REGULARLY OR ON AN EXCEPTIONAL BASIS TO A COUNTRY OTHER THAN THAT IN WHICH HE PERFORMS HIS DUTIES . UNTIL 31 MARCH 1979 ARTICLE 17 ( 4 ) PROVIDED THAT SUCH TRANSFERS WERE TO BE MADE THROUGH THE INSTITUTION WHICH HE SERVES ' ' AT THE OFFICIAL EXCHANGE RATE RULING ON THE DATE OF TRANSFER ' ' . THE ' ' OFFICIAL EXCHANGE RATE ' ' WITHIN THE MEANING OF THAT PROVISION WAS THE LAST PARITY ACCEPTED BY THE INTERNATIONAL MONETARY FUND , WHICH HAD NOT BEEN ALTERED SINCE 1 NOVEMBER 1969 ( FOR EXAMPLE , BFR 13.66 = DM 1 ).
4 ON 21 DECEMBER 1978 THE COUNCIL ADOPTED REGULATION ( EURATOM , ECSC , EEC ) NO 3085/78 ( OFFICIAL JOURNAL 1978 , L 369 , P . 6 ). ARTICLE 1 OF THAT REGULATION PROVIDES THAT ARTICLE 63 OF THE STAFF REGULATIONS IS REPLACED BY THE FOLLOWING WORDING : ' ' OFFICIALS ' REMUNERATION SHALL BE EXPRESSED IN BELGIAN FRANCS . IT SHALL BE PAID IN THE CURRENCY OF THE COUNTRY IN WHICH THE OFFICIAL PERFORMS HIS DUTIES . REMUNERATION PAID IN A CURRENCY OTHER THAN BELGIAN FRANCS SHALL BE CALCULATED ON THE BASIS OF THE EXCHANGE RATES USED FOR THE IMPLEMENTATION OF THE GENERAL BUDGET OF THE EUROPEAN COMMUNITIES ON 1 JULY 1978 . THIS DATE SHALL BE CHANGED , AT THE TIME OF THE ANNUAL REVIEW OF REMUNERATION PROVIDED FOR IN ARTICLE 65 , BY THE COUNCIL ACTING BY A QUALIFIED MAJORITY UPON A PROPOSAL FROM THE COMMISSION AS PROVIED IN THE FIRST INDENT OF THE SECOND SUBPARAGRAPH OF ARTICLES 148 ( 2 ) OF THE EEC TREATY AND OF 118 ( 2 ) OF THE EURATOM TREATY . WITHOUT PREJUDICE TO THE APPLICATION OF ARTICLES 64 AND 65 , THE WEIGHTINGS FIXED PURSUANT TO THESE ARTICLES SHALL , WHENEVER THE ABOVE DATE IS CHANGED , BE ADJUSTED BY THE COUNCIL , WHICH , ACTING IN ACCORDANCE WITH THE PROCEDURE MENTIONED IN THE THIRD PARAGRAPH , SHALL CORRECT THE EFFECT OF THE VARIATION IN THE BELGIAN FRANC WITH RESPECT TO THE RATES REFERRED TO IN THE SECOND PARAGRAPH . ' '
5 ARTICLE 2 OF THE REGULATION PROVIDES : ' ' ARTICLE 17 OF ANNEX VII SHALL BE REPLACED BY THE FOLLOWING : ' ARTICLE 17 1 . PAYMENT SHALL BE MADE TO EACH OFFICIAL AT THE PLACE AND IN THE CURRENCY OF THE COUNTRY WHERE HE CARRIES OUT HIS DUTIES . 2 . UNDER THE TERMS LAID DOWN IN RULES DRAWN UP BY COMMON AGREEMENT BY THE INSTITUTIONS OF THE COMMUNITIES , AFTER CONSULTATION OF THE STAFF REGULATIONS COMMITTEE , AN OFFICIAL MAY : ( A ) THROUGH THE INSTITUTION WHICH HE SERVES , REGULARLY HAVE PART OF HIS EMOLUMENTS TRANSFERRED UP TO A MAXIMUM AMOUNT EQUAL TO HIS EXPATRIATION OR FOREIGN RESIDENCE ALLOWANCE : EITHER IN THE CURRENCY OF THE MEMBER STATE OF WHICH HE IS A NATIONAL , OR IN THE CURRENCY OF THE MEMBER STATE IN WHICH EITHER HIS OWN DOMICILE OR THE PLACE OF RESIDENCE OF A DEPENDENT RELATIVE IS LOCATED , OR IN THE CURRENCY OF HIS PREVIOUS COUNTRY OF EMPLOYMENT OR OF THE COUNTRY IN WHICH HIS INSTITUTION HAS ITS SEAT , PROVIDED THAT THE OFFICIAL IN QUESTION HAS BEEN ASSIGNED TO A POST OUTSIDE THE TERRITORY OF THE EUROPEAN COMMUNITIES ; ( B)HAVE REGULAR TRANSFERS MADE IN EXCESS OF THE MAXIMUM STATED AT THE BEGINNING OF PARAGRAPH ( A ) PROVIDED THAT THEY ARE INTENDED TO COVER EXPENDITURE ARISING IN PARTICULAR OUT OF COMMITMENTS PROVED TO HAVE BEEN REGULARLY UNDERTAKEN BY THE OFFICIAL OUTSIDE THE COUNTRY WHERE THE INSTITUTION HAS ITS SEAT OR OUTSIDE THE COUNTRY WHERE HE CARRIES OUT HIS DUTIES ; ( C)BE AUTHORIZED , IN VERY EXCEPTIONAL CIRCUMSTANCES AND FOR GOOD REASONS SUPPORTED BY EVIDENCE , TO HAVE TRANSFERRED , APART FROM THE AFOREMENTIONED REGULAR TRANSFERS , SUMS WHICH HE MAY WISH TO HAVE AVAILABLE IN THE CURRENCIES REFERRED TO IN PARAGRAPH ( A ). 3 . THE TRANSFERS PROVIDED FOR IN PARAGRAPH ( 2 ) SHALL BE MADE AT THE EXCHANGE RATE SPECIFIED IN THE SECOND PARAGRAPH OF ARTICLE 63 OF THE STAFF REGULATIONS ; THE AMOUNTS TRANSFERRED SHALL BE MULTIPLIED BY A COEFFICIENT REPRESENTING THE DIFFERENCE BETWEEN THE WEIGHTING FOR THE COUNTRY ( IN WHOSE CURRENCY THE TRANSFER IS MADE AND THE WEIGHTING FOR THE COUNTRY ) IN WHICH THE OFFICIAL IS EMPLOYED . ' ' '
6 ARTICLE 4 OF THE REGULATION PROVIDES THAT IT IS TO ENTER INTO FORCE ON 1 JANUARY 1979 AND IS TO APPLY FROM 1 APRIL 1979 .
7 ON 21 DECEMBER 1978 THE COUNCIL ALSO ADOPTED REGULATION ( EURATOM , ECSC , EEC ) NO 3086/78 ADJUSTING THE WEIGHTINGS APPLICABLE TO THE REMUNERATION AND PENSIONS OF OFFICIALS AND OTHER SERVANTS OF THE EUROPEAN COMMUNITIES FOLLOWING THE AMENDMENT OF THE PROVISIONS OF THE STAFF REGULATIONS . ARTICLE 1 ( 1 ) OF THE REGULATION FIXES INTER ALIA THE WEIGHTING APPLICABLE TO REMUNERATION AS 74.3 FOR ITALY AND 98.7 FOR THE FEDERAL REPUBLIC OF GERMANY .
8 UNDER ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS THE APPLICANT HAD CERTAIN AMOUNTS TRANSFERRED REGULARLY TO BELGIUM AND THE FEDERAL REPUBLIC OF GERMANY . THE EXCHANGE VALUE IN ITALIAN LIRE OF THE SUMS THUS REGULARLY TRANSFERRED AMOUNTED IN MARCH 1979 TO LIT 847 675 .
9 AS FROM 1 APRIL 1979 THE COST OF THOSE TRANSFERS IN ITALIAN LIRE AT THE EXCHANGE RATE CALCULATED IN ACCORDANCE WITH THE NEWLY WORDED ARTICLE 17 ( 3 ) OF ANNEX VII TO THE STAFF REGULATIONS , MENTIONED ABOVE , AMOUNTED TO LIT 1 334 934 .
10 ON 21 JUNE 1979 THE APPLICANT FILED A COMPLAINT UNDER ARTICLE 90 ( 2 ) OF THE STAFF REGULATIONS REGARDING THE INCREASE IN THE COST OF TRANSFERS MADE BY HIM AS FROM APRIL 1979 . ON 28 SEPTEMBER 1979 THE COMMISSION REPLIED BY A LETTER WHICH , ACCORDING TO THE APPLICANT , WAS ADDRESSED IN INCERTAM PERSONAM , TO THE EFFECT THAT , ON THE ONE HAND , IT COULD NOT WITHOUT EXCEEDING ITS AUTHORITY FAIL TO APPLY COUNCIL REGULATIONS WHICH HAD PROPERLY ENTERED INTO FORCE AND , ON THE OTHER HAND , THAT IN SUBSTANCE IT APPROVED THE AMENDMENTS MADE TO THE STAFF REGULATIONS .
11 THE APPLICANT THEREFORE BROUGHT THIS ACTION ASKING THE COURT ( 1 ) TO ANNUL THE IMPLIED DECISION REJECTING HIS COMPLAINT , AND , IN THE ALTERNATIVE , THE ' ' SO-CALLED ' ' EXPRESS DECISION OF 28 SEPTEMBER 1979 ; ( 2 ) TO DECLARE UNLAWFUL THE DECREASE IN THE PART OF THE REMUNERATION PAID TO THE APPLICANT IN ITALIAN LIRE , CETERIS PARIBUS , WITH EFFECT FROM APRIL 1979 ; ( 3 ) TO DECLARE THAT THE APPLICANT IS ENTITLED TO HAVE THE PARTS OF HIS SALARY WHICH ARE PAID IN ITALIAN LIRE AND IN FOREIGN CURRENCY MAINTAINED UNCHANGED , CONSOLIDATED AT THE MARCH 1979 LEVEL , UNTIL THE EFFECTS OF THE CHANGE ARE ABSORBED BY INCREASES IN RE MUNERATION - OTHER THAN THOSE PAYABLE IN RESPECT OF VARIATIONS IN PURCHASING POWER - AND IS ALSO ENTITLED TO RECTIFICATION OF THE MONTHLY PAYMENTS MADE IN THE INTERVENING PERIOD .
12 THE APPLICANT RELIES IN THE FIRST PLACE ON CERTAIN GROUNDS BASED ON AN INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS . HE MAINTAINS THAT THE CONTESTED REGULATIONS WERE ADOPTED WITHOUT PRIOR CONSULTATION WITH THE INSTITUTIONS CONCERNED REFERRED TO IN ARTICLE 24 OF THE TREATY OF 8 APRIL 1965 ESTABLISHING A SINGLE COUNCIL AND A SINGLE COMMISSION OF THE EUROPEAN COMMUNITIES ( HEREINAFTER REFERRED TO AS ' ' THE MERGER TREATY ' ' ). THE ECONOMIC AND SOCIAL COMMITTEE WAS NOT CONSULTED , NOR WAS THE COURT OF AUDITORS WHICH , ACCORDING TO THE APPLICANT , ARE THE INSTITUTIONS CONCERNED WITHIN THE MEANING OF THAT ARTICLE . MOREOVER , CONSULTATION WITH THE EUROPEAN PARLIAMENT TOOK PLACE ON THE BASIS OF A PROPOSAL FROM THE COMMISSION WHICH WAS CONSIDERABLY DIFFERENT FROM THE TEXT OF THE REGULATION ADOPTED BY THE COUNCIL .
13 THE APPLICANT THEN PUTS FORWARD ARGUMENTS CONCERNING THE CONTENT AND EFFECTS OF THE REGULATIONS . HE CRITICIZES THE APPLICATION OF THE REGULATIONS , MAINTAINING THAT IMPLEMENTATION OF THE NEW WORDING OF ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS BREACHES THE PRINCIPLE OF PROTECTION OF VESTED RIGHTS ; THAT SINCE THE CHANGE IN THE CONDITIONS LAID DOWN IN THE STAFF REGULATIONS INVOLVED A CONSIDERABLE REDUCTION OF THE NET REMUNERATION RECEIVED BY OFFICIALS IT UNDERMINED THE FUNDAMENTAL CONDITIONS WHICH WERE OF SUCH A KIND AS TO INFLUENCE THE APPLICANT ' S DECISION TO AGREE TO BE BOUND BY THE STAFF REGULATIONS ; AND THAT THE APPLICATION OF THE TEXT WAS IN BREACH OF FORMAL COMMITMENTS ENTERED INTO BY THE COMMISSION TO THE EFFECT THAT IT WOULD ENSURE THAT THE MEASURES PROPOSED BY IT WOULD BE STRICTLY NEUTRAL AND WOULD NOT AFFECT THE REAL VALUE OF PAYMENTS MADE TO OFFICIALS IN RESPECT OF THEIR REMUNERATION , PENSIONS AND ALLOWANCES . THE MANNER IN WHICH THE WEIGHTING WAS CALCULATED IN REGULATION NO 3086/78 , NAMELY BY THE USE OF AN ACCOUNTING DEVICE INTENDED TO LEAVE MATTERS AS THEY WERE , EXCEPT AS REGARDS THE ADVERSE IMPACT ON TRANSFERS , CONSTITUTES A CASE OF MISUSE OF POWERS . MOREOVER , THE STATEMENT OF THE REASONS ON WHICH THE REGULATIONS IN QUESTION WERE BASED DID NOT SATISFY THE REQUIREMENTS OF ARTICLE 190 OF THE TREATY .
14 THE APPLICANT ALSO COMPLAINS OF THE DISCRIMINATION WHICH , ACCORDING TO HIM , IS INHERENT IN THE TRANSITIONAL PROVISIONS APPLICABLE TO PENSIONS IN VIEW OF THE FACT THAT NO TRANSITIONAL PROVISIONS ARE APPLICABLE TO THE TRANSFERS MADE BY THE APPLICANT IN ACCORDANCE WITH ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS . THE COMMISSION SHOULD , IN THE DISCHARGE OF ITS DUTY TO ASSIST OFFICIALS , OF WHICH ARTICLE 24 OF THE STAFF REGULATIONS CONSTITUTES AN ILLUSTRATION , HAVE LAID DOWN TRANSITIONAL PROCEDURES FOR COMPENSATION , BY WAY OF AN IMPLEMENTING MEASURE , WHICH SHOULD HAVE BEEN COTERMINOUS WITH THE LEGAL AND CONTRACTUAL OBLIGATIONS OF THE OFFICIALS . INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS
15 IT SHOULD BE NOTED THAT , WHEN CHANGES ARE MADE TO THE STAFF REGULATIONS OF OFFICIALS AND THE CONDITIONS OF EMPLOYMENT OF OTHER SERVANTS , COMMUNITY LAW REQUIRES THAT THE PARLIAMENT AND THE COURT OF JUSTICE BE CONSULTED AND THAT THE OPINION OF THE STAFF REGULATIONS COMMITTEE BE OBTAINED . ARTICLE 24 OF THE MERGER TREATY PROVIDES THAT ' ' THE COUNCIL SHALL , ACTING BY A QUALIFIED MAJORITY ON A PROPOSAL FROM THE COMMISSION AND AFTER CONSULTING THE OTHER INSTITUTIONS CONCERNED , LAY DOWN THE STAFF REGULATIONS OF OFFICIALS OF THE EUROPEAN COMMUNITIES AND THE CONDITIONS OF EMPLOYMENT OF OTHER SERVANTS OF THOSE COMMUNITIES ' ' . ARTICLE 10 OF THE STAFF REGULATIONS PROVIDES THAT THE STAFF REGULATIONS COMMITTEE ( CONSISTING OF REPRESENTATIVES OF THE STAFF COMMITTEES ) IS TO BE CONSULTED BY THE COMMISSION ON ANY PROPOSAL FOR THE REVISION OF THE STAFF REGULATIONS .
16 A DISTINCTION SHOULD HOWEVER BE MADE BETWEEN THE REQUIREMENTS OF COMMUNITY LAW APPLICABLE TO REGULATION NO 3085/78 , WHICH INVOLVES AMENDMENT OF THE STAFF REGULATIONS , AND THOSE APPLICABLE TO REGULATION NO 3086/78 , WHICH ADJUSTS THE WEIGHTINGS . A REGULATION SUCH AS REGULATION NO 3086/78 , WHICH DETERMINES THE WEIGHTINGS , IS ADOPTED BY THE COUNCIL ON A PROPOSAL FROM THE COMMISSION PURSUANT TO ARTICLE 64 OF THE STAFF REGULATIONS , WHICH IMPOSES NO OBLIGATION INVOLVING CONSULTATION .
17 AS REGARDS REGULATION NO 3085/78 , IT IS TRUE THAT ARTICLE 24 OF THE MERGER TREATY PROVIDES FOR CONSULTATION WITH THE OTHER INSTITUTIONS CONCERNED , ONE OF THOSE BEING THE PARLIAMENT . THAT CONSULTATION , WHICH IN PARTICULAR ENABLES THE PARLIAMENT EFFECTIVELY TO PARTICIPATE IN THE COMMUNITY ' S LEGISLATIVE PROCESS , IS AN ESSENTIAL FEATURE OF THE INSTITUTIONAL BALANCE WHICH THE TREATIES SEEK TO ACHIEVE . REGULAR CONSULTATION WITH THE PARLIAMENT CONSTITUTES THEREFORE AN ESSENTIAL PROCEDURAL REQUIREMENT , THE DISREGARD OF WHICH RENDERS THE REGULATION IN QUESTION VOID . IT IS THEREFORE APPROPRIATE TO CONSIDER WHETHER THE REQUIRED CONSULTATION IN FACT TOOK PLACE .
18 ON 1 APRIL 1977 THE COMMISSION , AFTER GIVING NOTICE TO THE STAFF REGULATIONS COMMITTEE , PLACED BEFORE THE COUNCIL A PROPOSAL FOR A COUNCIL REGULATION INTRODUCING THE EUROPEAN UNIT OF ACCOUNT ( EUA ) INTO THE STAFF REGULATIONS ( OFFICIAL JOURNAL 1977 C 99 , P . 5 ). ARTICLE 1 CONCERNS SUBSTITUTIONS OF THE EUA FOR THE BELGIAN FRANC IN ARTICLE 63 OF THE STAFF REGULATIONS . THE PROPOSAL INCORPORATED THE CHANGES MADE NECESSARY BY THE ADOPTION OF THE EUA , IN PARTICULAR THE SUBSTITUTION OF A NEW TABLE IN ARTICLE 66 OF THE STAFF REGULATIONS , IN WHICH REMUNERATION IS EXPRESSED IN EUROPEAN UNITS OF ACCOUNT IN PLACE OF THE OLD TABLE IN WHICH REMUNERATION IS EXPRESSED IN BELGIAN FRANCS . ARTICLE 4 OF THE PROPOSAL CONCERNS SUBSTITUTION OF THE FOLLOWING WORDING FOR ARTICLE 17 ( 4 ) OF ANNEX VII TO THE STAFF REGULATIONS : ' ' TRANFERS PROVIDED FOR IN PARAGRAPHS ( 2 ) AND ( 3 ) SHALL BE MADE ON THE BASIS OF THE VALUE OF THE EUROPEAN UNIT OF ACCOUNT ( EUA ) SPECIFIED IN THE SECOND PARAGRAPH OF ARTICLE 63 OF THE STAFF REGULATIONS ; THE AMOUNTS TRANSFERRED SHALL BE WEIGHTED BY A COEFFICIENT REPRESENTING THE RATIO BETWEEN THE WEIGHTING FOR THE COUNTRY IN THE CURRENCY OF WHICH THE TRANSFER IS MADE AND THE WEIGHTING FOR THE COUNTRY OF THE OFFICIAL ' S EMPLOYMENT . ' ' THE PROPOSAL INCLUDED OTHER PROVISIONS WHICH ARE NOT PERTINENT TO THIS CASE .
19 HAVING RECEIVED THE PROPOSAL AND A REQUEST FOR AN OPINION FROM THE COUNCIL , THE PARLIAMENT GAVE A FAVOURABLE OPINION ( OFFICIAL JOURNAL 1977 C 183 , P . 55 ). THE PARLIAMENT ' S RESOLUTION INCLUDED , INTER ALIA , THE FOLLOWING RECITALS : ' ' WHEREAS THE SOLE PURPOSE OF THE COMMISSION ' S PROPOSALS SUBMITTED TO PARLIAMENT IS TO EXPRESS IN EUROPEAN UNITS OF ACCOUNT THOSE VALUES ( REMUNERATIONS , ALLOWANCES , TRANSFERS OF FUNDS , WEIGHTINGS , TAX ) HITHERTO EXPRESSED IN BELGIAN FRANCS , WITHOUT AFFECTING THE RIGHTS OF STAFF OR EXPOSING THEIR EMOLUMENTS TO POSSIBLE FLUCTUATIONS ; . . . . . . WHEREAS FOLLOWING THE INTRODUCTION OF THE EUROPEAN UNIT OF ACCOUNT , WEIGHTINGS WILL NO LONGER BE REQUIRED TO CORRECT EXCHANGE PARITIES AND WILL HENCEFORTH BE USED PRINCIPALLY TO TAKE ACCOUNT OF INCREASES IN THE COST OF LIVING , AS ORIGINALLY INTENDED ; WHEREAS THE COMMISSION HAS GIVEN ASSURANCES THAT ITS PROPOSALS WILL IN NO WAY ADVERSELY AFFECT THE REMUNERATIONS AND OTHER ALLOWANCES OF OFFICIALS AND OTHER SERVANTS OF THE EUROPEAN COMMUNITIES ; ' '
20 THE RESOLUTION ASKS THE COMMISSION TO INTRODUCE , IN GOOD TIME , THE ADMINISTRATIVE ARRANGEMENTS NEEDED TO ENSURE THAT THE APPLICATION OF THE EUROPEAN UNIT OF ACCOUNT DOES NOT DISRUPT EXISTING ADMINISTRATIVE PRACTICES OR EVEN TEMPORARILY HARM THE INTERESTS OF THE EUROPEAN CIVIL SERVICE AND NOTES THE COMMISSION ' S ASSURANCE THAT ITS PROPOSAL WILL IN NO WAY AFFECT THE REAL VALUE OF THE PAYMENTS MADE TO OFFICIALS IN THE FORM OF REMUNERATION , PENSIONS AND ALLOWANCES .
21 IN A COMMUNICATION TO THE COUNCIL DATED 29 NOVEMBER 1978 THE COMMISSION EXPRESSED THE DESIRE THAT ARTICLE 1 OF ITS PROPOSAL OF 1 APRIL 1977 SHOULD BE AMENDED . THE TEXT OF THE NEW PROPOSAL CORRESPONDS TO THE FRIST TWO PARAGRAPHS OF ARTICLE 63 AS AMENDED BY REGULATION NO 3085/78 . IN THE SAME COMMUNICATION , THE COMMISSION PROPOSED A TRANSITIONAL PERIOD OF SIX MONTHS , THAT IS TO SAY UNTIL 1 OCTOBER 1979 , FOR PENSIONERS AND RECIPIENTS OF ALLOWANCES WHOSE NET EMOLUMENTS WOULD SUFFER A REDUCTION FOLLOWING THE UPDATING .
22 REGULATION NO 3085/78 FOLLOWED THAT PROPOSAL FROM THE COMMISSION , ADDING , HOWEVER , AFTER THE PROPOSED TRANSITIONAL PROVISION , A FURTHER TRANSITIONAL PROVISION : ' ' FROM THAT DATE THE DIFFERENCE BETWEEN THE NET AMOUNTS RESULTING FROM THE IMPLEMENTATION OF THIS REGULATION AND THOSE RECEIVED IN SEPTEMBER 1979 SHALL BE REDUCED BY 1/10 PER MONTH ' ' .
23 IT APPEARS FROM THE REPORT OF THE PARLIAMENT ' S COMMITTEE ON BUDGETS THAT THE PARLIAMENT WAS IN A POSITION TO ASSESS THE POSSIBLE IMPACT OF THE COMMISSION ' S INITIAL PROPOSAL ON PENSIONS AND TRANSFERS MADE UNDER ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS AND THAT THE ASSURANCES GIVEN TO PARLIAMENT BY THE COMMISSION MUST BE UNDERSTOOD TO THE EFFECT THAT THE ' ' NEUTRALITY ' ' OF THE PROPOSAL CONCERNED THE ENTIRE REMUNERATION OF OFFICIALS AND THAT IN CERTAIN CASES THE COMMISSION ' S PROPOSAL MIGHT HAVE THE EFFECT OF INCREASING THE COST OF TRANSFERS .
24 IN FACT , THE REGULATION FINALLY ADOPTED CONFORMED TO THE PROPOSAL SUBMITTED TO THE PARLIAMENT APART FROM THE SUBSTITUTION OF UPDATED EXCHANGE RATES FOR THE EUA AND THE TRANSITIONAL PROVISIONS INTENDED TO ALLEVIATE THE EFFECT OF THE PROVISIONS OF THE REGULATION FOR A SPECIFIC PERIOD WITH REGARD TO CERTAIN PENSIONERS . AS REGARDS THE SUBSTITUTION OF THE UPDATED EXCHANGE RATES FOR THE EUA , IT SHOULD BE NOTED THAT THE RATES ADOPTED EXACTLY REFLECTED THE VALUE OF THE EUA IN TERMS OF NATIONAL CURRENCIES AS AT 1 APRIL 1978 , SO THAT THAT AMENDMENT TO THE INITIAL PROPOSAL CONSTITUTED IN REALITY A CHANGE OF METHOD RATHER THAN OF SUBSTANCE . AS REGARDS THE TRANSITIONAL PROVISION FOR THE BENEFIT OF CERTAIN PENSIONERS , IT SHOULD BE NOTED THAT THAT PROVISION CORRESPONDED BROADLY TO THE WISH EXPRESSED BY THE PARLIAMENT .
25 IN THOSE CIRCUMSTANCES , FURTHER CONSULTATION WITH THE PARLIAMENT REGARDING THE CONTESTED PROVISIONS WAS UNNECESSARY .
26 AS REGARDS THE ARGUMENT PUT FORWARD BY THE APPLICANT THAT THE ECONOMIC AND SOCIAL COMMITTEE AND THE COURT OF AUDITORS ARE INSTITUTIONS WITHIN THE MEANING OF ARTICLE 24 OF THE MERGER TREATY , AND THAT CONSULTATION WITH THEM IS AN ESSENTIAL CONDITION FOR THE ADOPTION OF A REGULATION AMENDING THE STAFF REGULATIONS , IT SHOULD BE REMEMBERED THAT THE TREATIES ESTABLISHING THE COMMUNITIES CONTAIN PROVISIONS SPECIFYING THE INSTITUTIONS OF THE THREE COMMUNITIES . THE ECONOMIC AND SOCIAL COMMITTEE AND THE COURT OF AUDITORS ARE NOT AMONG THOSE INSTITUTIONS . ACCORDINGLY , CONSULTATION WITH THE ECONOMIC AND SOCIAL COMMITTEE AND THE COURT OF AUDITORS WAS NOT MANDATORY .
27 IT IS TRUE THAT , ACCORDING TO THE SECOND PARAGRAPH OF ARTICLE 1 OF THE STAFF REGULATIONS , THE ECONOMIC AND SOCIAL COMMITTEE AND THE COURT OF AUDITORS ARE TREATED AS COMMUNITY INSTITUTIONS FOR THE PURPOSES OF THE STAFF REGULATIONS . THAT TREATMENT , THE OBJECT OF WHICH IS TO ENSURE THAT THE STAFF REGULATIONS ARE APPLIED TO THE OFFICIALS AND OTHER SERVANTS OF THOSE TWO BODIES AND TO IDENTIFY THE APPOINTING AUTHORITY FOR THOSE EMPLOYEES , DOES NOT HOWEVER EXTEND TO THE APPLICATION OF THE PROVISIONS OF THE TREATIES , SUCH AS ARTICLE 24 OF THE MERGER TREATY , RELATING TO THE ADOPTION OF COMMUNITY REGULATIONS . CONTENT AND EFFECTS OF THE REGULATIONS
28 THE APPLICANT IS OF THE OPINION THAT THE NEW SYSTEM FOR CALCULATING THE EXCHANGE RATES FOR TRANSFERS ENCROACHES UPON HIS VESTED RIGHTS . ON THE BASIS OF THE PROVISIONS IN FORCE UNTIL APRIL 1979 THE APPLICANT ENTERED INTO BINDING COMMITMENTS FROM WHICH HE COULD NOT BE DISCHARGED FOR A SPECIFIC PERIOD OF TIME . THE EXISTENCE FOR MANY YEARS OF THE FACILITY FOR TRANSFERRING REGULARLY A CERTAIN PART OF HIS MONTHLY REMUNERATION INDUCED HIM TO ENTER INTO THOSE COMMITMENTS AND HE HAD EVERY RIGHT TO BELIEVE THAT THE SYSTEM WOULD NOT BE CHANGED TO HIS DISADVANTAGE BEFORE HE WAS CLEAR OF HIS COMMITMENTS , PARTICULARLY WITH REGARD TO LOANS . HE IS THEREFORE ENTITLED TO THE MAINTENANCE IN FORCE OF THE OLD TRANSFER SYSTEM , OR AT LEAST TO A TRANSITIONAL SYSTEM CONTINUING TO APPLY THE PREVIOUS EXCHANGE RATES UNTIL HE IS CLEAR OF HIS COMMITMENTS . THE COMMISSION GAVE A FORMAL UNDERTAKING TO THE PARLIAMENT TO ENSURE THAT THE MEASURES TO BE ADOPTED WOULD BE STRICTLY ' ' NEUTRAL ' ' AND WOULD NOT AFFECT THE REAL VALUE OF THE PAYMENTS MADE TO OFFICIALS IN THE FORM OF REMUNERATION , PENSIONS AND ALLOWANCES .
29 THE APPLICANT ' S ARGUMENTS ARE BASED ON THE PREMISE THAT HE IS ENTITLED TO HAVE THE EXCHANGE RATE APPLIED TO TRANSFERS MADE PURSUANT TO ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS MAINTAINED AT A LEVEL ENABLING HIM TO RECEIVE , AFTER MAKING THOSE TRANSFERS , A BALANCE OF REMUNERATION IN ITALIAN LIRE EQUAL TO THE AMOUNT HE RECEIVED IN MARCH 1979 , AT LEAST UNTIL HE IS CLEAR OF THE COMMITMENTS HE ENTERED INTO BEFORE APRIL 1979 . IT SHOULD , HOWEVER , BE NOTED THAT THE EXCHANGE RATES APPLIED UNTIL APRIL 1979 WERE PARTICULARLY FAVOURABLE TO OFFICIALS EMPLOYED IN COUNTRIES WITH A WEAK CURRENCY . IN FACT , THE WEIGHTING HAD BEEN FIXED SO AS TO TAKE INTO ACCOUNT THE DEVALUATION OF THE CURRENCY IN THE PLACE OF EMPLOYMENT , AND WAS APPLIED TO THE REMUNERATION IN ITS ENTIRETY , WHEREAS THE TRANSFERS WERE MADE AT THE EXCHANGE RATE FOR THE YEAR 1969 . AS FROM APRIL 1979 REMUNERATION WAS CALCULATED ON THE BASIS OF THE UPDATED EXCHANGE RATES , SO AS TO ENSURE THAT EACH OFFICIAL RECEIVED THE SAME TOTAL REMUNERATION , EXPRESSED IN NATIONAL CURRENCY , AS HE RECEIVED IN MARCH 1979 . TRANSFERS CONTINUED TO BE MADE AT AN EXCHANGE RATE MORE FAVOURABLE THAN THE OFFICIAL RATE , ALTHOUGH LESS FAVOURABLE THAN THE RATE PREVIOUSLY USED , THIS BEING ACHIEVED BY APPLICATION TO THE AMOUNT TRANSFERRED OF THE WEIGHTING DERIVED FROM THE RELATIONSHIP EXISTING BETWEEN THE WEIGHTING FIXED FOR THE COUNTRY IN WHOSE CURRENCY THE TRANSFER WAS MADE AND THE WEIGHTING FIXED FOR THE COUNTRY IN WHICH THE OFFICIAL WAS EMPLOYED . THIS METHOD OF CALCULATING THE EXCHANGE RATE WAS INTENDED TO ENABLE AN OFFICIAL EMPLOYED IN A COUNTRY WITH A WEAK CURRENCY TO MAKE THE TRANSFERS IN QUESTION IN RESPECT OF THE SAME PART OF HIS TOTAL REMUNERATION AS AN OFFICIAL EMPLOYED IN A COUNTRY WITH A STRONG CURRENCY .
30 IT IS TRUE THAT THE APPLICATION OF THE NEW PROVISIONS AT ISSUE ENTAILED A DECREASE IN THE BALANCE REMAINING FOR THE APPLICANT AFTER MAKING THE SAME TRANSFERS AS IN MARCH 1979 . IT SHOULD , HOWEVER , BE NOTED THAT THAT BALANCE AFTER THE TRANSFERS ARE MADE HAS NOT BEEN CONSTANT FOR MANY YEARS , AS IS IMPLIED IN THE APPLICANT ' S STATEMENTS , BUT HAS VARIED ACCORDING TO ADJUSTMENTS OF THE WEIGHTING IN LINE WITH CHANGES IN THE COST OF LIVING AND THE RATE OF INFLATION .
31 IT MUST BE REMEMBERED THAT THE WEIGHTING WAS INTRODUCED DURING A PERIOD OF RELATIVE STABILITY OF CURRENCIES AND THAT ITS FUNCTION WAS TO ENSURE THAT AN OFFICIAL ' S REMUNERATION WAS COMMENSURATE WITH THE LIVING CONDITIONS IN THE VARIOUS PLACES OF EMPLOYMENT . HOWEVER , FOLLOWING THE MONETARY CRISIS , THE WEIGHTING WAS USED NOT ONLY TO ADAPT REMUNERATION TO THE LIVING CONDITIONS IN THE VARIOUS PLACES OF EMPLOYMENT BUT ALSO TO PROVIDE COMPENSATION FOR THE DEVALUATION OF CERTAIN WEAK CURRENCIES . THUS , IN 1978 , WHILST THE COST OF LIVING IN ITALY WAS LOWER THAN THAT IN BELGIUM , THE WEIGHTING FOR ITALY WAS ALMOST HALF AS HIGH AGAIN AS THAT FOR BELGIUM . THE APPLICATION OF THAT WEIGHTING TO THE EXCHANGE RATES PROVIDED FOR THE STAFF REGULATIONS IN FORCE UNTIL THE END OF 1978 ( BFR 1 = LIT 12.50 ) COMPENSATED FOR THE DEVALUATION OF THE LIRA .
32 AN INEVITABLE RESULT OF THAT USE OF THE WEIGHTING WAS THAT THE WEIGHTING HAD TO BE APPLIED TO THE PORTION OF REMUNERATION INTENDED TO BE TRANSFERRED PURSUANT TO ARTICLE 17 OF ANNEX VII TO THE STAFF REGULATIONS AT THE OFFICIAL RATE SINCE IT FORMED PART OF THE TOTAL REMUNERATION . AS A RESULT , THE MORE A WEAK CURRENCY WAS DEVALUED , THE GREATER WAS THE DECREASE OF THE PORTION OF THE TOTAL REMUNERATION REQUIRED FOR THE TRANSFER OF A SPECIFIC AMOUNT TO A COUNTRY WITH A STRONG CURRENCY .
33 ON THE OTHER HAND , AFTER THE AMENDMENT TO THE STAFF REGULATIONS RESULTING FROM REGULATION NO 3085/78 , IT WAS POSSIBLE TO RESTORE THE PROPER FUNCTION OF THE WEIGHTING , NAMELY THAT OF REFLECTING THE LIVING CONDITIONS IN THE VARIOUS PLACES OF EMPLOYMENT . ALTHOUGH THE COST OF THE TRANSFERS WAS RENDERED LESS FAVOURABLE , THE SYSTEM NEVERTHELESS CONTINUED TO BENEFIT OFFICIALS EMPLOYED IN A COUNTRY WITH A WEAK CURRENCY .
34 IT APPEARS THEREFORE THAT EVEN THOUGH THERE MAY BE LIMITS ON THE POWERS OF THE COMMUNITY LEGISLATURE TO REDUCE THE BENEFITS ENJOYED BY OFFICIALS UNDER A SYSTEM PROVIDED FOR IN THE STAFF REGULATIONS , THE VIEW THAT IN THIS CASE THOSE LIMITS HAVE NOT BEEN OBSERVED CANNOT BE UPHELD .
35 THE APPLICANT ALSO CRITICIZES THE MANNER IN WHICH THE WEIGHTING IS CALCULATED IN REGULATION NO 3086/78 . ACCORDING TO HIM , THAT CALCULATION CONSISTS OF AN ACCOUNTING DEVICE INTENDED TO LEAVE THINGS AS THEY ARE , EXCEPT WITH REGARD TO THE ADVERSE EFFECT ON TRANSFERS , WHICH CONSTITUTES A MISUSE OF POWER .
36 IN THAT RESPECT , IT SHOULD BE NOTED THAT THE ADJUSTMENT OF THE EXCHANGE RATES MADE BY REGULATION NO 3085/78 REMOVED THE NEED FOR USE OF THE WEIGHTING TO COMPENSATE FOR THE DEVALUATION OF CERTAIN CURRENCIES . ALTHOUGH AS A RESULT THE WEIGHTING WAS FIXED IN SUCH A MANNER AS TO GIVE EACH OFFICIAL THE TOTAL REMUNERATION HE WOULD HAVE RECEIVED UNDER THE OLD SYSTEM AND ALTHOUGH IN CERTAIN CASES THAT INVOLVED THE LOSS OF CERTAIN ADVANTAGES REGARDING TRANSFERS , THAT CONSEQUENCE WAS IN HARMONY WITH THE PURPOSE FOR WHICH THE STAFF REGULATIONS WERE AMENDED AND COULD NOT BE DESCRIBED AS A MISUSE OF POWER .
37 AS REGARDS THE STATEMENT OF THE REASONS ON WHICH THE REGULATIONS WERE BASED , WHICH THE APPLICANT REGARDS AS INSUFFICIENT , IT IS TRUE THAT IN THE CASE OF REGULATION NO 3085/78 IT WAS SUCCINCT , BUT IN VIEW OF THE FLUCTUATION OF THE VARIOUS WORLD CURRENCIES WHICH OCCURRED AFTER ADOPTION OF THE STAFF REGULATIONS , THE RECITAL EXPRESSING THE NEED FOR ADJUSTMENT OF THE EXCHANGE RATES MAY BE REGARDED AS A SUFFICIENT STATEMENT OF REASONS . AS REGARDS REGULATION NO 3086/78 , IT IS SUFFICIENT TO NOTE THAT IT IS , AS STATED IN THE RECITALS IN THE PREAMBLE THERETO , THE NECESSARY CONSEQUENCE OF REGULATION NO 3085/78 AND ACCORDINGLY THE STATEMENT OF REASONS UPON WHICH IT IS BASED IS SUFFICIENT .
38 FURTHERMORE THE APPLICANT MAINTAINS THAT THE ABSENCE IN THE CONTESTED REGULATIONS OF TRANSITIONAL PROVISIONS IN FAVOUR OF SERVING OFFICIALS SIMILAR TO THOSE OF WHICH PENSIONERS HAVE THE BENEFIT BREACHES THE PRINCIPLE OF NON-DISCRIMINATION .
39 IN THAT RESPECT , IT IS SUFFICIENT TO POINT OUT THAT DISCRIMINATION IN THE LEGAL SENSE CONSISTS IN TREATING IN AN IDENTICAL MANNER SITUATIONS WHICH ARE DIFFERENT OR TREATING IN A DIFFERENT MANNER SITUATIONS WHICH ARE IDENTICAL . THE SITUATION OF A SERVING OFFICIAL DIFFERS CONSIDERABLY FROM THAT OF A PENSIONER , SO THAT THERE IS NO DISCRIMINATION IN A CASE WHERE THE COMMUNITY LEGISLATURE ACCORDS TO PENSIONERS TREATMENT WHICH IS NOT IDENTICAL TO THAT APPLIED TO SERVING OFFICIALS .
40 THE SAME PRINCIPLE APPLIES REGARDING THE ALLEGED DISCRIMINATION ARISING FROM THE FACT THAT THE COMMISSION ' S DECISION TO APPLY FOR A PERIOD OF FIVE YEARS A SPECIAL POLICY CONCERNING THE VALUES TO BE TAKEN INTO CONSIDERATION REGARDING THE COST OF MAINTENANCE OF PERSONS TREATED AS DEPENDANTS ( ADMINISTRATIVE NOTICES NO 233 OF 30 APRIL 1979 ). THE MATTER OF TRANSFERS MAY NOT BE TREATED ON THE SAME FOOTING AS THE CASE OF THE PERSONS REFERRED TO BY THAT DECISION .
41 THE ARGUMENTS BASED ON THE ALLEGED DISCRIMINATION MUST THEREFORE BE REJECTED .
42 CONSIDERATION OF THE SUBMISSIONS OF THE APPLICANT HAVING SHOWN THAT NONE OF THE GROUNDS RELIED UPON MAY BE UPHELD , THE ACTION MUST BE DISMISSED AS UNFOUNDED .