61956J0002

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1 . PROCEDURE - APPLICATION FOR ANNULMENT - APPLICATION FOR PARTIAL ANNULMENT

2 . DECISIONS OF THE HIGH AUTHORITY - STATEMENT OF REASONS - EXTENT OF THE OBLIGATION TO STATE REASONS

3 . APPLICATION FOR ANNULMENT - ESSENTIAL PROCEDURAL REQUIREMENTS

4 . CARTELS - NECESSITY FOR AN AUTHORIZATION

5 . CARTELS - AUTHORIZATION

6 . APPLICATION FOR ANNULMENT - EXTENT OF THE POWER OF REVIEW BY THE COURT

7 . DISCRIMINATION - CARTELS

8 . DISCRIMINATION - INDIRECT DISCRIMINATION PRACTISED BY CERTAIN PRODUCERS IN RESPECT OF OTHER PRODUCERS

9 . DISCRIMINATION - PURCHASERS - DISCRIMINATION BETWEEN TRADERS

1 . ARTICLE 34 OF THE TREATY IS NO BAR TO THE ADMISSIBILITY OF AN APPLICATION FOR ANNULMENT AGAINST AN ISOLATED PROVISION OF A DECISION AS A WHOLE, BECAUSE AN ANNULLING JUDGMENT DOES NOT ANTICIPATE THE MEASURES WHICH THE HIGH AUTHORITY MAY BE REQUIRED TO ADOPT IN ORDER TO AMEND ITS DECISION, HAVING REGARD TO THE ANNULMENT

( TREATY, ARTICLES 33, 34 ).

2 . ACCORDING TO THE GENERAL PROVISIONS OF ARTICLES 5 AND 15 OF THE TREATY, THE HIGH AUTHORITY IS REQUIRED TO STATE THE REASONS FOR ITS DECISIONS, MENTIONING THOSE FACTS ON WHICH THE LEGAL JUSTIFICATION FOR THE MEASURE DEPENDS AND THE CONSIDERATIONS WHICH HAVE LED IT TO ADOPT ITS DECISION . THE REASONS ON WHICH THE DECISION IS BASED MUST BE STATED IN ORDER THAT REVIEW BY THE COURT SHALL BE POSSIBLE . THE HIGH AUTHORITY IS NOT REQUIRED TO DISCUSS ALL THE OBJECTIONS WHICH MIGHT BE RAISED AGAINST THE DECISION .

IT IS NOT NECESSARY TO STATE INDEPENDENT AND EXHAUSTIVE REASONS FOR AN ISOLATED ARTICLE OF A COMPLEX DECISION, WHEN SUFFICIENT REASONS CAN BE DEDUCED FROM THE CONTEXT OF ALL THE FINDINGS STATED IN SUPPORT OF THE DECISION AS A WHOLE

( TREATY, ARTICLES 5, 15 ).

3 . IN ORDER TO JUDGE WHETHER THERE HAS BEEN AN INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS, IT IS NOT NECESSARY TO EXAMINE WHETHER THE CONCEPTION OF THE HIGH AUTHORITY IS CORRECT IN LAW . WHAT MATTERS IS THAT IT MUST BE LOGICALLY COMPATIBLE WITH THE DECISION ADOPTED ( TREATY, ARTICLE 33 ).

4 . IN PRINCIPLE, IT IS NOT ONLY A JOINT-SELLING AGREEMENT AS SUCH THAT IS SUBJECT TO AUTHORIZATION, BUT ALSO THE DETAILED METHODS OF IMPLEMENTATION AND THE PARTICULAR RULES ESTABLISHED FOR THAT PURPOSE

( TREATY, ARTICLE 65 ).

5 . THE HIGH AUTHORITY IS NOT REQUIRED TO ALTER THE CONTENTS OF AN AGREEMENT WHICH IS SUBMITTED TO IT UNDER ARTICLE 65, IN ORDER FOR IT TO QUALIFY FOR AUTHORIZATION

( TREATY, ARTICLE 65 ).

6 . WHERE IT IS NOT NECESSARY TO TAKE INTO CONSIDERATION AND TO ASSESS ECONOMIC FACTS IN ORDER TO FIND THAT AN AGREEMENT IS OF A RESTRICTIVE NATURE, THE COURT HAS UNLIMITED JURISDICTION TO REVIEW THAT FINDING

( TREATY, SECOND SENTENCE OF FIRST PARAGRAPH OF ARTICLE 33 ).

7 . ARTICLES 4 ( B ) AND 65 OF THE TREATY GOVERN THE DIFFERENT ASPECTS OF ECONOMIC LIFE IN THEIR RESPECTIVE FIELDS OF APPLICATION .

THOSE TWO ARTICLES DO NOT EXCLUDE NEITHER DO THEY ANNUL EACH OTHER; ON THE CONTRARY, THEY SERVE TO BRING ABOUT THE OBJECTIVES OF THE COMMUNITY . THEY ARE THUS COMPLEMENTARY IN THIS RESPECT . IN CERTAIN CASES THEIR PROVISIONS CAN COVER ACTS JUSTIFYING A SIMULTANEOUS AND CONCURRENT APPLICATION OF THE SAID ARTICLES

( TREATY, ARTICLES 4 ( B ), 65 ).

8 . DISCRIMINATION BETWEEN PRODUCERS IS POSSIBLE . WHERE A SELLING AGENCY TAKES INTO ACCOUNT PURCHASES MADE BY ITS WHOLESALERS FROM TWO OTHER GIVEN AGENCIES, WHEREAS THE SAME COMPETITION SHOULD EXIST BETWEEN THEM AS EXISTS BETWEEN THE FIRST OF THOSE AGENCIES AND THE OTHER PRODUCERS OF THE COMMUNITY - WHOSE SALES IT DOES NOT TAKE INTO ACCOUNT - THAT METHOD OF PROCEEDING CONSTITUTES INDIRECT DISCRIMINATION IN THAT IT ENCOURAGES THE PURCHASERS TOWARDS A PREFERENCE FOR OBTAINING SUPPLIES OF THE PRODUCTS DISTRIBUTED BY THOSE OTHER TWO AGENCIES, TO THE DETRIMENT OF THE REMAINING PRODUCERS OF THE COMMUNITY

( TREATY, ARTICLE 4 ( B )).

9 . WHERE TRADERS - WHO ARE PURCHASERS WITHIN THE MEANING OF ARTICLE 4 ( B ) - ORDERING THE SAME QUANTITY OF GOODS FROM A GIVEN SELLING AGENCY ARE TREATED UNEQUALLY BY THE SAID AGENCY ACCORDING TO WHETHER THEY ALSO OBTAIN SUPPLIES FROM CERTAIN OTHER AGENCIES, UNEQUAL TREATMENT EXISTS FOR INADEQUATE REASONS AND IT CONSTITUTES DISCRIMINATION BETWEEN TRADERS

( TREATY, ARTICLE 4 ( B )).

IN CASE 2/56

1 . THE UNDERNAMED MINING UNDERTAKINGS OF THE RUHR BASIN, BEING MEMBERS OF THE GEITLING SELLING AGENCY FOR RUHR COAL, A LIMITED LIABILITY COMPANY :

STEINKOHLENBERGWERK HEINRICH ROBERT AG, HERRINGEN, BERGWERKE ESSEN-ROSSENRAY AG, ESSEN, BERGBAU AG LOTHRINGEN, BOCHUM, MUELHEIMER BERWERKSVEREIN, MUELHEIM/RUHR, RHEINPREUSSEN AG FUER BERGBAU UND CHEMIE, HOMBERG/NIEDERRHEIN, STEINKOHLENBERGWERK MATHIAS STINNES AG, ESSEN, GEBR . STUMM GMBH, ZECHE MIN . ACHENBACH, BRAMBAUER/WESTFALEN, HOESCH BERGWERKS AG, DORTMUND, GEWERKSCHAFT VER . KLOSTERBUSCH, HERBEDE/RUHR, STEINKOHLENBERGWERK FRIEDRICH DER GROSSE AG, HERNE, RHEINELBE BERGBAU AG, GELSENKIRCHEN, GRAF MOLTKE BERGBAU AG, GELSENKIRCHEN, STEINKOHLENBERGBAU HANNOVER-HANNIBAL AG, BOCHUM, BERGWERKSGESELLSCHAFT WALSUM MBH, WALSUM/NIEDERRHEIN, GEWERKSCHAFT SOPHIA JACOBA, HUECKELHOVEN/AACHEN, HARPENER BERGBAU AG, DORTMUND, MONOPOL BERGBAU AG, KAMEN, GEWERKSCHAFT ALTE HAASE, DORTMUND, GEWERKSCHAFT GOTTESSEGEN, DORTMUND, REPRESENTED BY THE GEITLING SELLING AGENCY FOR RUHR COAL, A LIMITED LIABILITY COMPANY, 4, FRAU-BERTA-KRUPP-STRASS, ESSEN,

2 . THE GEITLING SELLING AGENCY FOR RUHR COAL, A LIMITED LIABILITY COMPANY, FRAU-BERTA-KRUPP-STRASSE 4, ESSEN,

JOINTLY REPRESENTED BY WERNER VON SIMSON, ADVOCATE AT THE OBERLANDESGERICHT, DUESSELDORF WITH AN ADDRESS FOR SERVICE AT THE CHAMBERS OF THEIR ADVOCATE AT LUXEMBOURG-CAPELLEN, APPLICANTS,

V

HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL COMMUNITY, REPRESENTED BY ITS LEGAL ADVISER ROBERT KRAWIELICKI, ACTING AS AGENT, ASSISTED BY PHILIPP MOEHRING, ADVOCATE AT THE BUNDESGERICHTSHOF, KARLSRUHE, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT ITS OFFICES, 2, PLACE DE METZ, DEFENDANT,

APPLICATION FOR THE ANNULMENT OF ARTICLE 8 OF DECISION NO 5/56 OF THE HIGH AUTHORITY OF 15 FEBRUARY 1956,

P . 14

A - ADMISSIBILITY OF THE APPLICATION

1 . THE APPLICATION HAS BEEN PROPERLY LODGED IN DUE FORM AND WITHIN THE PRESCRIBED TIME-LIMIT . ITS ADMISSIBILITY HAS NOT BEEN CONTESTED BY THE DEFENDANT IN THE WRITTEN PROCEDURE AND THE COURT HAS NO OCCASION TO RAISE ANY OBJECTION OF ITS OWN MOTION .

2 . DURING THE ORAL PROCEDURE IT HAS BEEN ARGUED THAT AN APPLICATION CANNOT BE ADMISSIBLE IF IT CONTESTS AN ISOLATED PROVISION OF A DECISION AS A WHOLE, SINCE A PARTIAL ANNULMENT AUTOMATICALLY TRANSFORMS THE REMAINDER OF THE DECISION INTO A NEW DECISION, AND THAT THIS IS CONTRARY TO ARTICLE 34 OF THE TREATY, WHICH PROVIDES THAT WHERE A DECISION IS ANNULLED, THE MATTER SHALL BE REFERRED BACK TO THE HIGH AUTHORITY .

P . 15

THIS OBJECTION IS UNFOUNDED BECAUSE UNDER ARTICLE 34 THE JUDGMENT CANNOT ANTICIPATE THE MEASURES WHICH THE HIGH AUTHORITY MAY BE REQUIRED TO ADOPT IN ORDER TO AMEND ITS DECISION, HAVING REGARD TO THE ANNULMENT .

3 . THE CONTESTED DECISION INDIVIDUALLY CONCERNS EACH OF THE 19 MINING UNDERTAKINGS, THE APPLICANTS AT 1, BEING COAL PRODUCING UNDERTAKINGS WITH A RIGHT TO INSTITUTE PROCEEDINGS BEFORE THE COURT .

THE APPLICANT AT 2 MUST BE CONSIDERED AS AN UNDERTAKING REGULARLY ENGAGED IN DISTRIBUTION WITHIN THE MEANING OF ARTICLE 80 OF THE TREATY . THEREFORE THE SAID ARTICLE, TOGETHER WITH ARTICLE 65 OF THE TREATY, GIVES IT THE RIGHT TO INSTITUTE PROCEEDINGS BEFORE THE COURT .

4 . THE APPLICATION IS THEREFORE ADMISSIBLE . THE APPLICANTS MAY RAISE ALL THE GROUNDS SET OUT IN THE FIRST PARAGRAPH OF ARTICLE 33 .

B - SUBSTANCE

( I ) INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS

1 . THE APPLICANTS SEE AN INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS IN THE INADEQUACY OF THE REASONS IN SUPPORT OF ARTICLE 8 OF THE DECISION; ACCORDING TO THEM, AN ERROR AS TO REASONS IS EQUIVALENT TO AN ABSENCE OF REASONS .

ACCORDING TO THE GENERAL PROVISIONS OF ARTICLE 5 AND 15 OF THE TREATY, THE HIGH AUTHORITY IS REQUIRED TO STATE THE REASONS FOR ITS DECISIONS, MENTIONING THOSE FACTS ON WHICH THE LEGAL JUSTIFICATION FOR THE MEASURE DEPENDS, AND THE CONSIDERATIONS WHICH HAVE LED IT TO ADOPT ITS DECISION . THE REASONS ON WHICH THE DECISION IS BASED MUST BE STATED IN ORDER THAT REVIEW BY THE COURT SHALL BE POSSIBLE .

HOWEVER, THE HIGH AUTHORITY IS NOT REQUIRED TO DISCUSS ALL THE POSSIBLE OBJECTIONS WHICH MIGHT BE RAISED AGAINST THE DECISION .

2 . IN GENERAL TERMS, IT WAS NOT NECESSARY IN THE PRESENT CASE TO STATE INDEPENDENT AND EXHAUSTIVE REASONS FOR THE CONTESTED ARTICLE, AS AN ELEMENT OF A COMPLEX DECISION . SUFFICIENT REASONS CAN BE DEDUCED FROM THE CONTEXT OF ALL THE FINDINGS STATED IN SUPPORT OF THE DECISION AS A WHOLE .

SUCH IS THE CASE AS REGARDS THE DECISION AT ISSUE . THE HIGH AUTHORITY FOUND FIRST THAT THE PROVISIONS OF THE TRADING RULES - THE CLAUSE AT ISSUE APPEARS AMONG THEM - WHICH DETERMINE WHICH TRADERS MAY RECEIVE DIRECT SUPPLIES, INVOLVE A " SHARING OF CUSTOMERS AND OF THE MARKET " WITHIN THE MEANING OF ARTICLE 4 ( D ) AND OF ARTICLE 65 ( 1 ) OF THE TREATY ( JO NO 6 OF 13.3.1956, P . 33 ). IT WENT ON TO STATE THAT SUCH RULES CAN BE AUTHORIZED SUBJECT TO CERTAIN CONDITIONS . IT THEN EXPLAINED THAT THE PARTS OF THE COMMERCIAL RULES AUTHORIZED MET THOSE CONDITIONS AND WHY THAT WAS THE POSITION ( JO NO 6 OF 13.3.1956, P . 34 ).

P . 16

AT THE SAME TIME, THE HIGH AUTHORITY INDICATED THE REASONS FOR WHICH IT WAS OF THE OPINION THAT THE CLAUSE AT ISSUE DID NOT SATISFY THE SAID CONDITIONS . THE EFFECT OF THE SAID CLAUSE WAS THAT UP TO A QUANTITY OF 25 000 METRIC TONS, THE DEALER WOULD " DEFER THE PURCHASE OF FUELS FROM PRODUCERS OF OTHER BASINS ". IT ( THUS ) LEADS " TO A DISCRIMINATION " AND IS, MOREOVER, " MORE RESTRICTIVE THAN IS NECESSARY IN ORDER TO ACHIEVE THE PURPOSE OF THIS DELIMITATION ", WHICH IS TO DEFINE WHICH WHOLESALE TRADERS CAN BE ACCEPTED FOR DIRECT PURCHASES ( JO NO 6 OF 13.3.1956, P . 34 ).

THOSE REASONS MUST BE CONSIDERED AS SUFFICIENT, SINCE THEY CLEARLY AND COMPLETELY SET OUT THE CONSIDERATIONS OF FACT AND OF LAW ON WHICH THE REJECTION OF THE CLAUSE IS BASED .

MOREOVER, THE COURT CANNOT SHARE THE OPINION OF THE APPLICANTS, THAT THE ARGUMENTS OF THE HIGH AUTHORITY DO NOT CONSTITUTE LEGALLY ACCEPTABLE REASONS, BECAUSE THEY ARE ALSO APPLICABLE TO THE CRITERIA WHICH THE HIGH AUTHORITY DID NOT CRITICIZE . THAT OPINION IS INCORRECT, IF ONLY BECAUSE THE SAID CRITERIA MERELY REQUIRE THE PURCHASE OF A CERTAIN TONNAGE FROM THE WHOLE OF THE COMMUNITY OR FROM THE APPLICANTS, BUT NOT FROM CERTAIN OTHER SELLING AGENCIES .

IN ORDER TO JUDGE WHETHER THERE HAS BEEN AN INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS, IT IS NOT NECESSARY TO EXAMINE WHETHER THE CONCEPTION OF THE HIGH AUTHORITY IS CORRECT IN LAW . WHAT MATTERS IS THAT IT MUST BE LOGICALLY COMPATIBLE WITH THE DECISION ADOPTED .

( II ) INFRINGEMENT OF THE TREATY

A - IN GENERAL

TWO COMPLAINTS HAVE BEEN MADE IN SUPPORT OF THE SUBMISSION THAT THE TREATY HAS BEEN INFRINGED, NAMELY FAILURE TO UNDERSTAND THE PROHIBITION ON DISCRIMINATION IN ARTICLE 4 ( B ) AND FAILURE TO UNDERSTAND THE PROHIBITION ON CARTELS IN ARTICLE 65 .

THE EXAMINATION OF THE SUBMISSIONS OF THE APPLICANTS MUST START FROM THE REQUEST FOR AUTHORIZATION WHICH THEY SUBMITTED, THE PARTIAL REJECTION OF WHICH BY THE HIGH AUTHORITY CONSTITUTES THE SUBJECT-MATTER OF THE DISPUTE .

THAT REQUEST MANIFESTLY ACKNOWLEDGED THE FACT THAT THE AGREEMENT CONCLUDED BY THE APPLICANTS AT 1, RELATING TO " THE SALE OF FUELS FROM INSTALLATIONS WITHIN THE COMMON MARKET DURING THE PERIOD FROM 1 APRIL 1956 TO 31 MARCH 1959 " UNDENIABLY CAME WITHIN ARTICLE 65 ( 1 ) OF THE TREATY .

IN ITS GENERAL ASSESSMENT OF THE SITUATION, THE HIGH AUTHORITY STARTS FROM THE EXISTENCE OF AN AGREEMENT RESTRICTING COMPETITION WHICH MUST BE EXAMINED IN THE LIGHT OF THE GROUNDS FOR AUTHORIZATION . IT REFERS BOTH TO THE PROHIBITION ON DISCRIMINATION AND THE GROUNDS FOR AUTHORIZATION SET OUT IN ARTICLE 65 ( 2 ), THE PROVISION BEING PERFECTLY COMPLEMENTARY .

THAT POINT CLEARLY APPEARS FROM THE CONSIDERATIONS PUT FORWARD IN THE REASONS FOR DECISION NO 5/56 OR ARISING FROM THE TREATY, NAMELY THAT THE DECISION IS BASED IN PARTICULAR ON ARTICLES 4 AND 65 OF THE TREATY ( JO NO 6 OF 13.3.1956, P . 29 );

THE DECISION IS BASED IN PARTICULAR ON ARTICLES 4 AND 65 OF THE TREATY ( JO NO 6 OF 13.3.1956, P . 29 );

THE TRADING RULES CONTAINED IN THE AGREEMENT CONCLUDED ON 6 FEBRUARY 1956 BY THE APPLICANTS AT 1 IS CONSIDERED AS PART OF A JOINT-SELLING AGREEMENT ON FUELS ( JO NO 6 OF 13.3.1956, P . 29 AND P . 32 ET SEQ .);

ARTICLE 65 ( 2 ) PROVIDES THAT JOINT-SELLING AGREEMENTS MAY BE AUTHORIZED . THE RESULT IS, AS IS SHOWN BY THE REMAINDER OF THE GENERAL CONSIDERATIONS, THAT IN THE FIRST INSTANCE THEY ARE CAUGHT BY THE PROHIBITION IN ARTICLE 65 ( 1 ) AND THAT THEY ARE THEN SUBJECT TO AUTHORIZATION .

THEREFORE THE APPLICATION PUTS FORWARD A COMPLAINT BASED ON AN INCORRECT APPLICATION OF ARTICLE 65 OF THE TREATY . THE STRUCTURE OF THAT PROVISION REQUIRES THAT ONE MUST FIRST EXAMINE WHETHER THERE EXISTS A RESTRICTION ON COMPETITION SUBJECT TO AUTHORIZATION ( ARTICLE 65 ( 1 )), AND THEN EXAMINE WHETHER THERE ARE GROUNDS FOR AUTHORIZING THAT RESTRICTION ( ARTICLE 65 ( 2 )).

B - INFRINGEMENT OF ARTICLE 65 OF THE TREATY

1 . IS THERE A RESTRICTION ON COMPETITION WITHIN THE MEANING OF ARTICLE 65 ( 1 )?

( A ) THE APPLICANTS DID NOT AT FIRST DENY THAT THE TRADING RULES CONTAINED IN THEIR AGREEMENT CONSTITUTED A RESTRICTION ON COMPETITION WHICH WAS SUBJECT TO AUTHORIZATION . IN THEIR REPLY, THEY ARGUED FOR THE FIRST TIME THAT THE CLAUSE AT ISSUE, AS SUCH, DID NOT CONTAIN A RESTRICTION, AND THAT THEREFORE IT WAS NOT SUBJECT TO AUTHORIZATION .

THAT ARGUMENT CAN HAVE ITS PLACE AS A DEVELOPMENT OF THE SUBMISSION OF INFRINGEMENT OF ARTICLE 65, PUT FORWARD IN THE APPLICATION, AND IT MUST NOT BE CONSIDERED AS AN INDEPENDENT COMPLAINT, WHICH COULD BE REJECTED AS OUT OF TIME UNDER ARTICLE 22 OF THE STATUTE OF THE COURT .

( B ) IT IS NOT DENIED THAT THE WHOLE OF THE APPLICANT'S JOINT-SELLING AGREEMENT, INCLUDING THE TRADING RULES, WAS SUBJECT TO AUTHORIZATION . IT SHARES THE CUSTOMERS AND THE MARKET AND IS SUCH AS TO RESTRICT OR DISTORT COMPETITION BETWEEN THE DIFFERENT MEMBER UNDERTAKINGS IN GEITLING . GIVEN THAT THE JOINT-SELLING AGREEMENT, AS SUCH, IS SUBJECT TO AUTHORIZATION, THE SAME APPLIES, IN PRINCIPLE, TO THE DETAILED METHODS OF IMPLEMENTATION, AND THUS, IN THE PRESENT CASE, TO THE CLAUSE AT ISSUE .

MOREOVER ANY LIMITATION ON THE NUMBER OF WHOLESALE TRADERS ACCEPTED AS FIRST-HAND CUSTOMERS RESTRICTS OR DISTORTS COMPETITION BETWEEN TRADERS, WHATEVER THE NUMBER OF INTERESTED PARTIES . IN ORDER TO REACH THIS FINDING, IT IS NOT NECESSARY TO IN ORDER TO REACH THIS FINDING, IT IS NOT NECESSARY TO EXAMINE THE PRACTICAL EFFECTS OF THE TRADING RULES IN THE PRESENT CASE . THE FINDING EMERGED IN ABSTRACTO FROM ARTICLE 65 ( 1 ).

P . 18

( C ) OTHER SPECIAL CONSIDERATIONS ARE ALSO RELEVANT IN THE PRESENT CASE . THE CLAUSE AT ISSUE AND THE RECIPROCAL TAKING INTO ACCOUNT OF PURCHASES OF RUHR COAL WHICH IT INVOLVES IMPROVE THE COMPETITIVE POSITION OF ALL THE SELLING AGENCIES FOR RUHR COAL VIS-A-VIS THE REMAINDER OF THE PRODUCERS OF THE COMMUNITY, AND THUS DISTORT NORMAL COMPETITION IN THE COMMON MARKET BETWEEN EACH OF THOSE AGENCIES AND ITS COMPETITORS . THE FACT THAT THE CLAUSE AT ISSUE DISTORTS AND RESTRICTS COMPETITION RESULTS PRIMARILY FROM THE LIMITATION ON COMPETITION WHICH IT INVOLVES IN RESPECT OF THE SALES OF THE PRODUCTS OF EACH SELLING AGENCY FOR RUHR COAL IN FAVOUR OF THE TWO OTHERS .

A WHOLESALE TRADER WHO HAS ALREADY PURCHASED 12 500 METRIC TONS FROM THE APPLICANT AT 2 MUST, IN ORDER TO SATISFY THE CRITERION AT ISSUE, PURCHASE 12 500 EXTRA METRIC TONS OF RUHR COAL FROM ONE OF THE OTHER TWO SELLING AGENCIES FOR RUHR COAL - ASSUMING HE DOES NOT PURCHASE THEM FROM THE SAID APPLICANT - AND THAT OBLIGATION DISTORTS OR RESTRICTS COMPETITION BETWEEN THE THREE AGENCIES .

THE AGREEMENTS PREVIOUSLY SUBMITTED BY THE PRESIDENT AND MAUSEGATT AGENCIES TO THE HIGH AUTHORITY FOR AUTHORIZATION CONTAINED CORRESPONDING CLAUSES ( CF . DECISIONS NOS 6/56 AND 7/56, JO NO 6 OF 13.3.1956, P . 47 AND P . 60 ). IF THE HIGH AUTHORITY HAD AUTHORIZED THE CLAUSE AT ISSUE AND THE SIMILAR CLAUSES OF THE OTHER TWO AGENCIES, IT WOULD HAVE PRACTICALLY APPROVED, ON THAT POINT, OF A SORT OF MARKET-SHARING ARRANGEMENT BETWEEN ALL THE PRODUCERS OF COAL FROM THE RUHR BASIN .

THE HIGH AUTHORITY INTENDED TO PREVENT COMPETITION FROM BEING DISTORTED AND TO PREVENT SUCH A CONCENTRATION FROM BEING CREATED . ITS AIM WAS " TO ENSURE BY APPROPRIATE LIMITATIONS AND CONDITIONS IN THIS AUTHORIZATION THAT THE INDEPENDENCE OF THE THREE SELLING AGENCIES FOR RUHR COAL SHALL BE PRESERVED, AND THAT IN PARTICULAR IT SHALL REMAIN POSSIBLE FOR EACH SELLING AGENCY TO DEVELOP ITS OWN POLICY AS REGARDS PRODUCTION AND SALES " ( JO NO 6 OF 13.3.1956, P . 32 ).

THE FINDING THAT THE CLAUSE AT ISSUE DISTORTS AND RESTRICTS COMPETITION ARISES FROM A PURELY LEGAL ASSESSMENT OF THE TRADING RULES, WITHOUT ITS BEING NECESSARY TO CONSIDER AND TO ASSESS THE ECONOMIC CIRCUMSTANCES .

THUS THE QUESTION WHETHER THE COURT HAS JURISDICTION TO VERIFY THE FINDING DOES NOT ARISE IN THE PRESENT CASE .

IT FOLLOWS FROM THE FOREGOING CONSIDERATIONS THAT THE CLAUSE AT ISSUE WAS SUBJECT TO AUTHORIZATION, NOT ONLY AS AN ELEMENT OF THE WHOLE OF THE AGREEMENT CONCLUDED BY THE APPLICANTS, BUT ALSO OF ITSELF .

2 . IS THERE A RESTRICTION ON COMPETITION WHICH MAY BE AUTHORIZED UNDER ARTICLE 65 ( 2 )?

( A ) THE HIGH AUTHORITY JUSTIFIES ITS REFUSAL TO AUTHORIZE THE CLAUSE AT ISSUE UNDER ARTICLE 65 ( 2 ), ON THE GROUND THAT THE CRITERION REQUIRED OF A WHOLESALE TRADER IN ORDER THAT HE SHALL QUALIFY IS OF A MORE RESTRICTIVE NATURE THAN IS REQUIRED FOR THE PURPOSE OF DEFINING THE CATEGORY ( JO NO 6 OF 13.3.1956, P . 34 ).

MOREOVER, IT APPEARS FROM THE STATEMENT, LOOKED AT AS A WHOLE, OF THE REASONS FOR THE DECISION, THAT THE CLAUSE, BEING AN ELEMENT OF THE TRADING RULES AND THUS OF THE JOINT-SELLING AGREEMENT SUBMITTED FOR AUTHORIZATION, WAS EXAMINED AND ASSESSED IN PARTICULAR FROM THE ASPECT OF ITS POSSIBLE CONTRIBUTION TO AN IMPROVEMENT IN THE DISTRIBUTION OF FUELS ( JO NO 6 OF 13.3.1956, P . 31 ).

P . 19

IN THIS REGARD, THE APPLICANTS SAY THAT THE CLAUSE WAS NECESSARY AS PART OF THE TRADING RULES FOR DETERMINING THE REQUIREMENT FOR ACCEPTANCE AS WHOLESALE TRADERS WITH THE RIGHT TO MAKE DIRECT PURCHASES, THAT REQUIREMENT ONLY BEING MET IF THE TRADER SELLS A LARGE TONNAGE OF FUELS OF THE SAME SORT, FOR PRESENT PURPOSES 25 000 METRIC TONS OF RUHR COAL, UPON IDENTICAL CONDITIONS AS TO FREIGHT, CARRIAGE AND STORAGE . THEY ARGUE THAT A TRADER IS ALL THE MORE SUITABLE IF HE IS GIVEN THE POSSIBILITY OF QUALIFYING AS A WHOLESALER WITH OTHER AGENCIES DISTRIBUTING THE SAME PRODUCTS BY MEANS OF THE PROVISIONS FOR SET-OFF LAID DOWN IN THE RULES .

THEY CLAIM THAT THIS SENSIBLE CHOICE OF TRADERS IS ESSENTIAL FOR AN APPRECIABLE IMPROVEMENT IN THE DISTRIBUTION OF THE PRODUCTS OF THE APPLICANTS, AND THAT IT THUS ACCORDS WITH THE PURPOSE OF ARTICLE 65 ( 2 ).

THE CLAUSE AT ISSUE, AND IN PARTICULAR THE RECIPROCAL SET-OFF OF QUANTITIES PURCHASED FROM CERTAIN OTHER SELLING AGENCIES FOR RUHR COAL FOR WHICH IT PROVIDES, LEADS IN ANY CASE TO AN IMPROVEMENT IN THE DISTRIBUTION OF RUHR COAL AS A WHOLE . UNDER THE TERMS OF THE TRADING RULES, THAT TASK IS ENTRUSTED TO CERTAIN ORGANIZATIONS COMMON TO THE THREE SELLING AGENCIES .

IN AUTHORIZING CERTAIN COMMON ORGANIZATIONS AND ARRANGEMENTS, THE HIGH AUTHORITY HAS IN FACT TAKEN INTO ACCOUNT, TO THE EXTENT PERMITTED BY THE TREATY, IN PARTICULAR BY ARTICLE 65, OF THE NATURAL CONDITIONS, MENTIONED BY THE APPLICANTS, COMMON TO ALL THE MINING UNDERTAKINGS OF THE RUHR .

TO A LARGE EXTENT, THOSE ORGANIZATIONS ENSURE THAT THE INTERESTS WHICH THE APPLICANTS PURPORT TO PROTECT BY THE APPLICATION OF THE CLAUSE AT ISSUE ARE UPHELD, NAMELY PUBLICITY IN FAVOUR OF RUHR COAL ( RUHRKOHLENBERATUNGSGESELLSCHAFT - JO NO 6 OF 13.3.1956, P . 31 ) AND MAINTENANCE OF A BALANCE IN CASE OF SCARCITY ( COMMON BUREAU - JO NO 6 OF 13.3.1956, P . 71 ).

HOWEVER, ACCORDING TO DECISION NO 5/56 OF THE HIGH AUTHORITY, EACH OF THE NEWLY CREATED SELLING AGENCIES MUST DEVELOP AN INDEPENDENT DISTRIBUTION POLICY . THEIR TRADING RULES CAN ONLY BE AUTHORIZED UNDER ARTICLE 65 ( 2 ) IF THEY MAKE FOR IMPROVEMENT IN THE DISTRIBUTION OF THE PRODUCT OF EACH OF THE AGENCIES .

THE CLAUSE AT ISSUE DOES NOT FULFIL THAT CONDITION, BECAUSE IN DETERMINING WHO ARE WHOLESALE TRADERS, IT PROVIDES FOR TAKING INTO ACCOUNT THE QUANTITIES BOUGHT FROM THE OTHER TWO JOINT-SELLING AGENCIES .

AS HAS BEEN EXPLAINED ABOVE, THAT IS UNNECESSARY AS REGARDS THE IMPROVEMENT OF THE DISTRIBUTION OF THE PRODUCT OF EACH OF THE AGENCIES . IT IS THUS MORE RESTRICTIVE THAN IS REQUIRED BY ITS PURPOSE . THIS FINDING ARISES DIRECTLY FROM THE TEXT OF THE CLAUSE AT ISSUE AND NOT FROM AN ASSESSMENT OF THE ECONOMIC SITUATION, WHICH WOULD NOT BE LIABLE TO REVIEW BY THE COURT .

( B ) THE COURT NEED NOT DECIDE WHETHER THE CLAUSE COULD HAVE BEEN AUTHORIZED IF IT HAD ONLY REQUIRED THAT 25 000 METRIC TONS BE PURCHASED FROM GEITLING AND IF IT HAD NOT GONE BEYOND WHAT WAS NECESSARY FOR A SUBSTANTIAL IMPROVEMENT IN THE DISTRIBUTION OF ITS PRODUCTS .

P . 20

IN ANY EVENT THE HIGH AUTHORITY WAS NOT REQUIRED TO ALTER THE CONTENTS OF AN AGREEMENT WHICH WAS SUBMITTED TO IT IN ORDER FOR IT TO QUALIFY FOR AUTHORIZATION . ( C ) THEREFORE, IN REFUSING TO AUTHORIZE THE CLAUSE AT ISSUE, THE DEFENDANT DID NOT INFRINGE ARTICLE 65 OF THE TREATY . C - DISCRIMINATION

IN GIVING REASONS FOR ITS REFUSAL TO AUTHORIZE THE DISPUTED PART OF THE TRADING RULES, THE HIGH AUTHORITY ALSO ARGUES THAT THE SAID CLAUSE ESTABLISHES DISCRIMINATION BETWEEN THE PRODUCERS OF THE COMMUNITY AS WELL AS BETWEEN CERTAIN GROUPS OR TRADERS .

THE APPLICANTS SEE AN INFRINGEMENT OF THE TREATY IN THE FACT THAT FIRST THE HIGH AUTHORITY MANIFESTLY FAILED TO UNDERSTAND THE RELATIONSHIP EXISTING BETWEEN ARTICLE 4 ( B ) AND ARTICLE 65 ( 2 ) AND THAT SECONDLY IT ALSO APPLIED ARTICLE 4 WRONGLY .

1 . IN SUPPORT OF A FAILURE TO UNDERSTAND THE RELATIONSHIP EXISTING BETWEEN ARTICLE 4 ( B ) AND ARTICLE 65, THE APPLICANTS CLAIM THAT THE PROVISIONS OF ARTICLE 65, SINCE THEY RANK AS A LEX SPECIALIS, EXCLUDE THE FUNDAMENTAL PROVISIONS OF ARTICLE 4 ( B ).

HOWEVER, SUCH IS NOT THE CASE .

ARTICLES 4 ( B ) AND 65 OF THE TREATY GOVERN THE DIFFERENT ASPECTS OF ECONOMIC LIFE IN THEIR RESPECTIVE FIELDS OF APPLICATION .

THOSE TWO ARTICLES DO NOT EXCLUDE NEITHER DO THEY ANNUL EACH OTHER; THEY SERVE TO BRING ABOUT THE OBJECTIVES OF THE COMMUNITY . THEY ARE THUS COMPLIMENTARY IN THIS RESPECT .

IN CERTAIN CASES THEIR PROVISIONS CAN COVER FACTS JUSTIFYING A SIMULTANEOUS AND CONCURRENT APPLICATION OF THE SAID ARTICLES .

THAT IS PARTICULARLY TRUE WHERE, AS IN THE PRESENT CASE, THE CLAUSE AT ISSUE IS MORE RESTRICTIVE THAN IS NECESSARY FOR THE PURPOSE OF THE RULES, SO THAT IT NOT ONLY FAILS TO QUALIFY FOR AUTHORIZATION UNDER ARTICLE 65, BUT ALSO CAN BRING ABOUT DISCRIMINATION WITHIN THE MEANING OF ARTICLE 4 ( B ).

THEREFORE IN MENTIONING ARTICLE 4 ( B ) IN SUPPORT OF ITS DECISION, THE HIGH AUTHORITY DID NOT INFRINGE THE TREATY .

2 . THE HIGH AUTHORITY WAS RIGHT IN STATING THAT THE CLAUSE AT ISSUE COULD BRING ABOUT DISCRIMINATION .

( A ) DISCRIMINATION BETWEEN PRODUCERS IS CONCEIVABLE AND POSSIBLE AS THE HIGH AUTHORITY HAS RIGHTLY ASSUMED .

P . 21

THE EFFECT OF THE CLAUSE AT ISSUE IS THAT THE APPLICANTS TAKE INTO ACCOUNT PURCHASES MADE BY WHOLESALERS FROM TWO OTHER GIVEN AGENCIES, WHEREAS THE SAME COMPETITION SHOULD EXIST BETWEEN THE SAID AGENCIES AND THE APPLICANTS AS EXISTS BETWEEN THE LATTER AND THE OTHER PRODUCERS OF THE COMMUNITY, WHOSE SALES THE SAID APPLICANTS DO NOT TAKE INTO ACCOUNT .

THAT METHOD OF PROCEEDING CONSTITUTES INDIRECT DISCRIMINATION IN THAT IT ENCOURAGES THE PURCHASERS TOWARDS A PREFERENCE FOR OBTAINING SUPPLIES FROM THE PRODUCERS OF RUHR COAL, TO THE DETRIMENT OF THE REMAINING PRODUCERS OF THE COMMUNITY .

( B ) IN ADDITION, THE FACTS OF THE CASE SHOW THE EXISTENCE OF DISCRIMINATION BETWEEN TRADERS .

ACCORDING TO THE CLAUSE, TRADERS - WHO ARE PURCHASERS WITHIN THE MEANING OF ARTICLE 4 ( B ) - ORDERING THE SAME QUANTITY, 12 500 METRIC TONS, FROM GEITLING, ARE TREATED UNEQUALLY, FOR INADEQUATE REASONS, ACCORDING TO WHETHER THEY ALSO PURCHASE 12 500 METRIC TONS FROM PRAESIDENT OR FROM MAUSEGATT . THE POSSIBILITY EXISTS OF THESE TRADERS BEING PLACED AT A DISADVANTAGE, AND THAT CONSTITUTES DISCRIMINATION .

ACCORDINGLY THE SUBMISSION AS TO INFRINGEMENT OF THE PROVISIONS CONCERNING DISCRIMINATION IS UNFOUNDED .

THEREFORE THE APPLICATION MUST BE REJECTED .

UNDER ARTICLE 60 OF THE RULES OF PROCEDURE OF THE COURT, THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS; THE APPLICANTS MUST ACCORDINGLY BE ORDERED TO BEAR THE COSTS OF THE PROCEEDINGS .

THE COURT

HEREBY :

DISMISSES THE APPLICATION FOR THE ANNULMENT OF ARTICLE 8 OF DECISION NO 5/56 OF THE HIGH AUTHORITY DATED 15 FEBRUARY 1956;

ORDERS THE APPLICANTS TO BEAR THE COSTS .