61969J0001

++++

1 . TRANSPORT - RATES AND CONDITIONS INVOLVING AN ELEMENT OF SUPPORT - EXAMINATION - AUTHORIZATION - POWERS AND DUTIES OF THE COMMISSION

( EEC TREATY, ARTICLE 80 )

2 . MEASURES ADOPTED BY AN INSTITUTION - STATEMENT OF REASONS

( EEC TREATY, ARTICLE 190 )

1 . BY EMPOWERING THE COMMISSION TO ACT ON ITS OWN INITIATIVE OR ON APPLICATION BY A MEMBER STATE TO EXAMINE THE RATES AND CONDITIONS INVOLVING AN ELEMENT OF SUPPORT AND BY INSTRUCTING IT IN THIS EXAMINATION TO TAKE ACCOUNT IN PARTICULAR OF THE REQUIREMENTS, NEEDS, PROBLEMS AND EFFECTS REFERRED TO IN ARTICLE 80(2 ), THE TREATY HAS CONFERRED ON THE COMMISSION A LARGE MEASURE OF DISCRETIONARY POWER, NOT ONLY AS REGARDS THE TARIFFS TO BE AUTHORIZED, BUT ALSO AS REGARDS THE DETAILS OF THE AUTHORIZATION TO BE GRANTED .

IT IS NOT POSSIBLE TO INTERPRET THIS PROVISION TO MEAN THAT THE COMMISSION IS OBLIGED TO GRANT ITS AUTHORIZATION ONCE CERTAIN CIRCUMSTANCES ARE ESTABLISHED, OR THAT IT IS OBLIGED TO MAINTAIN SUCH AUTHORIZATION IN FORCE AS LONG AS THE CIRCUMSTANCES WHICH GAVE RISE TO IT DO NOT CHANGE .

IN APPLYING ARTICLE 80(2 ) THE COMMISSION MUST RECONCILE THE ESSENTIAL DEMANDS OF THE COMMON MARKET AND THE PARTICULAR REQUIREMENTS OF REGIONAL DEVELOPMENT .

THE COMMISSION IS UNDER NO DUTY, IN ASSESSING THE REQUIREMENTS OF A REGIONAL ECONOMIC POLICY, TO ISOLATE THE TRANSPORT SECTOR FROM THE OTHER FACTORS OF DEVELOPMENT IN PARTICULAR FROM THE EFFECT OF MEASURES CONCERNING AGRICULTURAL POLICY .

2 . A STATEMENT OF REASONS MUST SHOW CLEARLY AND UNAMBIGUOUSLY THE GROUNDS ON WHICH THE MEASURE IS BASED .

IN CASE 1/69

GOVERNMENT OF THE ITALIAN REPUBLIC, REPRESENTED BY ADOLFO MARESCA, MINISTER PLENIPOTENTIARY, ACTING AS AGENT, ASSISTED BY PIETRO PERONACI ( DEPUTY STATE ADVOCATE-GENERAL ), WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE ITALIAN EMBASSY,

APPLICANT,

V

COMMISSION OF THE EUROPEAN COMMUNITIES, REPRESENTED BY ITS LEGAL ADVISER, ARMANDO TOLEDANO-LAREDO, ACTING AS AGENT, WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICES OF EMILE REUTER, LEGAL ADVISER TO THE COMMISSION, 4 BOULEVARD ROYAL,

DEFENDANT,

APPLICATION FOR THE ANNULMENT OF THE DECISION OF THE COMMISSION OF THE EUROPEAN COMMUNITIES OF 31 OCTOBER 1968 ( OFFICIAL JOURNAL L 281 OF 20 NOVEMBER 1968, P . 18 ), CONCERNING THE " DRAFT AMENDMENT TO THE ' CONDIZIONI E TARIFFE PER I TRASPORTI DELLE COSE SULLE F.S . '" CONCERNING PART II - CHAPTER VI - TABLE ENTITLED " RATES ", TITLE I OF SPECIAL TARIFF NO 201 - SERIES C - OF THE ITALIAN STATE RAILWAYS,

1 ON 10 JANUARY 1969 THE GOVERNMENT OF THE ITALIAN REPUBLIC INSTITUTED PROCEEDINGS UNDER THE PROVISIONS OF THE FIRST AND THIRD PARAGRAPHS OF ARTICLE 173 OF THE EEC TREATY FOR THE ANNULMENT OF THE DECISION OF THE COMMISSION OF THE EUROPEAN COMMUNITIES OF 31 OCTOBER 1968, CONCERNING A DRAFT AMENDMENT TO CERTAIN TARIFFS APPLIED BY THE ITALIAN RAILWAYS . THIS APPLICATION IS BASED ON THE INFRINGEMENT OF ARTICLE 80(2 ), ARTICLE 2 AND ARTICLE 3(D ) OF THE EEC TREATY, INFRINGEMENT OF AN ESSENTIAL PROCEDURAL REQUIREMENT AND MISUSE OF POWERS .

2 AS FROM THE BEGINNING OF THE SECOND STAGE OF THE TRANSITIONAL PERIOD ARTICLE 80(1 ) OF THE TREATY PROHIBITS THE IMPOSITION BY ANY MEMBER STATE, IN RESPECT OF TRANSPORT OPERATIONS CARRIED OUT WITHIN THE COMMUNITY, OF RATES AND CONDITIONS INVOLVING ANY ELEMENT OF SUPPORT OR PROTECTION IN THE INTEREST OF ONE OR MORE PARTICULAR UNDERTAKINGS OR INDUSTRIES, UNLESS AUTHORIZED BY THE COMMISSION . UNDER THE SECOND PARAGRAPH OF THIS ARTICLE THE COMMISSION IS TO EXAMINE SUCH RATES AND CONDITIONS, TAKING ACCOUNT IN PARTICULAR OF THE REQUIREMENTS OF AN APPROPRIATE REGIONAL ECONOMIC POLICY, THE NEEDS OF UNDERDEVELOPED AREAS AND THE PROBLEM OF AREAS SERIOUSLY AFFECTED BY POLITICAL CIRCUMSTANCES ON ONE HAND, AND OF THE EFFECTS OF SUCH RATES AND CONDITIONS ON COMPETITION BETWEEN THE DIFFERENT MODES OF TRANSPORT OF THE OTHER .

3 THE APPLICANT GOVERNMENT CONTESTS IN PARTICULAR THE LIMITATIONS AS TO TIME WHICH THE COMMISSION ATTACHED TO THE AUTHORIZATION IN QUESTION AND ALLEGES THAT, ONCE IT IS ESTABLISHED THAT THE TARIFFS AUTHORIZED ARE IN ACCORDANCE WITH THE REQUIREMENTS OF ARTICLE 80(2 ), THE WITHDRAWAL OR EXPIRY OF THE AUTHORIZATION COULD ONLY BE JUSTIFIED BY A CHANGE IN THE CIRCUMSTANCES ON WHICH THE AUTHORIZATION ITSELF IS BASED . THUS, TO FIX IN ADVANCE EXCESSIVELY SHORT TIMELIMITS FOR THE EXPIRY OF THE AUTHORIZATION WOULD, IN THE ABSENCE OF ANY EXCEPTIONAL CIRCUMSTANCES, BE CONTRARY TO THE OBJECTIVES AND THE WORDING OF ARTICLE 80 . IN SUPPORT OF ITS INTERPRETATION OF THIS ARTICLE, THE ITALIAN GOVERNMENT ALSO REFERS TO THE GENERAL OBJECTIVES OF THE TREATY, AS SET OUT IN ARTICLE 2 .

4 BY EMPOWERING THE COMMISSION TO ACT ON ITS OWN INITIATIVE OR ON APPLICATION BY A MEMBER STATE TO EXAMINE THE RATES AND CONDITIONS INVOLVING AN ELEMENT OF SUPPORT AND BY INSTRUCTING IT IN THIS EXAMINATION TO TAKE ACCOUNT IN PARTICULAR OF THE REQUIREMENTS, NEEDS, PROBLEMS AND EFFECTS REFERRED TO IN ARTICLE 80(2 ), THE TREATY HAS CONFERRED ON THE COMMISSION A LARGE MEASURE OF DISCRETIONARY POWER, NOT ONLY AS REGARDS THE TARIFFS TO BE AUTHORIZED, BUT ALSO AS REGARDS THE DETAILS OF THE AUTHORIZATION TO BE GRANTED .

IT IS NOT POSSIBLE TO INTERPRET THIS PROVISION TO MEAN THAT THE COMMISSION IS OBLIGED TO GRANT ITS AUTHORIZATION ONCE CERTAIN CIRCUMSTANCES ARE ESTABLISHED, OR THAT IT IS OBLIGED TO MAINTAIN SUCH AUTHORIZATION IN FORCE AS LONG AS THE CIRCUMSTANCES WHICH GAVE RISE TO IT DO NOT CHANGE .

5 FURTHERMORE, THE USE OF THE PHRASE " IN PARTICULAR " IN ARTICLE 80(2 ) SHOWS THAT THE COMMISSION MAY TAKE ACCOUNT OF OTHER FACTORS WHICH MAY CONFLICT WITH THOSE EXPRESSLY MENTIONED IN THAT ARTICLE . THE REFERENCE IN ARTICLE 80 TO THE REQUIREMENTS OF AN APPROPRIATE REGIONAL ECONOMIC POLICY EMPHASIZES THE IMPORTANCE WHICH THE TREATY ATTACHES TO THIS FACTOR IN A COMMUNITY CONTEXT . CONSIDERED IN THIS CONTEXT SUCH REQUIREMENTS DO NOT NECESSARILY LEAD TO THE CONFIRMATION OF THE PROPOSED MEASURES BUT OBLIGE THE COMMISSION TO EXERCISE ITS DISCRETIONARY POWERS IN ACCORDANCE WITH THE OBJECTIVES OF THE COMMUNITY . IN APPLYING ARTICLE 80(2 ), THEREFORE, THE COMMISSION MUST RECONCILE THE ESSENTIAL DEMANDS OF THE COMMON MARKET WITH THE PARTICULAR REQUIREMENTS OF REGIONAL DEVELOPMENT .

6 IN THE PRESENT CASE THE AUTHORIZATION IN DISPUTE CONCERNS A NEW TABLE ENTITLED " RATE " OF TITLE I - SERIES C - OF SPECIAL TARIFF NO 201, WHICH WAS INTRODUCED AT THE SAME TIME AS OTHER SPECIAL TARIFFS WERE ABOLISHED AND IS DESIGNED TO COMPENSATE IN PART FOR THE EFFECT OF THEIR ABOLITION . AS THE TARIFFS WHICH WERE ABOLISHED AT THAT TIME HAD ALREADY BEEN THE SUBJECT OF EARLIER AUTHORIZATIONS WHICH THE COMMISSION HAD REFUSED TO EXTEND, IT WAS ENTITLED TO REGARD THE FURTHER TARIFF SUBMITTED FOR EXAMINATION AS AN ADJUSTMENT MEASURE INTENDED TO MITIGATE THE EFFECTS OF THE REDUCTION IN THE AID FOR TRANSPORT RESULTING FROM THEIR ABOLITION .

7 AS THE COMMISSION CONSIDERED A PROGRESSIVE MODIFICATION IN THE TARIFF SITUATION TO BE DESIRABLE, IT WAS ABLE TO AUTHORIZE THE TARIFF IN QUESTION FOR A BRIEF PERIOD OF ADAPTATION . SUCH A MEASURE, DESIGNED TO MITIGATE THE EFFECTS OF PREVIOUS DECISIONS, NORMALLY FALLS WITHIN THE POWERS AND DUTIES LAID DOWN BY ARTICLE 80, ALTHOUGH NO CONCLUSIONS ARE NECESSARILY TO BE DRAWN FROM THE MEASURE .

8 THE ITALIAN GOVERNMENT ALLEGES THAT THE STATEMENT OF REASONS FOR THE MEASURE IN QUESTION DOES NOT DISCLOSE, WITH EVEN THE NECESSARY MINIMUM OF CLARITY, THE REASONS WHICH LED THE COMMISSION TO LIMIT ITS AUTHORIZATION AS TO TIME AND IT AGAIN PUTS FORWARD THE SUBMISSION OF INFRINGEMENT OF AN ESSENTIAL PROCEDURAL REQUIREMENT . IN ADDITION, IT CLAIMS THAT THE STATEMENT OF REASONS WAS ALSO CONTRADICTORY, AS, ALTHOUGH THE COMMISSION RECOGNIZED THAT THE MEASURES AUTHORIZED SATISFIED THE REQUIREMENTS OF ARTICLE 80(2 ), IT ONLY AUTHORIZED THEM FOR A LIMITED PERIOD .

9 A STATEMENT OF REASONS MUST SHOW CLEARLY AND UNAMBIGUOUSLY THE GROUNDS ON WHICH THE MEASURE IS BASED . ALTHOUGH THE STATEMENT OF REASONS IN QUESTION SEEMS FOR THE MOST PART TO SET OUT THE REASONS WHICH LED THE COMMISSION TO AUTHORIZE THE TARIFF IN DISPUTE, RATHER THAN TO JUSTIFY THE LIMITED DURATION OF THE AUTHORIZATION, NEVERTHELESS THE WORDING AND, IN PARTICULAR, THE REFERENCE IN THE NOTES TO PREVIOUS DECISIONS OF THE COMMISSION, WERE SUFFICIENT TO INFORM THE ITALIAN GOVERNMENT, TO WHOM THESE DECISIONS WERE ADDRESSED, OF THE GROUNDS ON WHICH IT WAS BASED AND TO SHOW IN WHAT LIGHT ITS REQUEST FOR AN AUTHORIZATION HAD BEEN EXAMINED AND CONSIDERED .

10 IN ITS SECOND GROUND OF COMPLAINT THE APPLICANT GOVERNMENT ALLEGES THAT TO FIX SUCH SHORT TIME-LIMITS AS THOSE IN THE PRESENT CASE AND TO PROVIDE FOR A POSSIBLE MODIFICATION OR AN EXPECTED REVOCATION, WITHOUT REFERRING TO THE POSSIBILITY OF AN EXTENSION, IS IPSO FACTO TO INFRINGE ARTICLE 80 .

11 IT FOLLOWS FROM THE ABOVE THAT THIS GROUND OF COMPLAINT MUST BE DISMISSED . IN FIXING RELATIVELY SHORT TIME-LIMITS THE COMMISSION DID NOT EXCEED ITS DISCRETIONARY POWERS CONFERRED BY ARTICLE 80 . THE GIVING OF A WARNING TO THE PERSON TO WHOM AN AUTHORIZATION IS ADDRESSED THAT IF THE SITUATION CHANGES SUCH AUTHORIZATION MIGHT BE MODIFIED OR REVOKED DOES NOT INCLUDE AN OBLIGATION TO INFORM HIM ALSO OF THE POSSIBILITY, WHICH ALWAYS EXISTS, OF AN EXTENSION OR A RENEWAL OF THE AUTHORIZATION .

12 FINALLY, THE APPLICANT GOVERNMENT PUTS FORWARD SUBMISSIONS BASED ON BOTH THE INFRINGEMENT OF THE TREATY AND OF AN ESSENTIAL PROCEDURAL REQUIREMENT AND ON MISUSE OF POWERS, INASMUCH AS THE CONTESTED MEASURE IS BASED ON THE ENTRY INTO FORCE OF REGULATION NO 159/66/EEC CONCERNING THE COMMON ORGANIZATION OF THE MARKETS IN FRUIT AND VEGETABLES . IT SAYS THAT THE IMPLEMENTATION OF MEASURES CONCERNING THE COMMON AGRICULTURAL POLICY HAS NOTHING TO DO WITH ARTICLE 80, WHICH SHOULD APPLY INDEPENDENTLY TO THE SITUATIONS FOR WHICH IT PROVIDES .

13 THIS GROUND OF COMPLAINT SHOULD ALSO BE REJECTED . AS ALREADY EXPLAINED THE COMMISSION IS UNDER NO DUTY, IN ASSESSING THE REQUIREMENTS OF A REGIONAL ECONOMIC POLICY, TO ISOLATE THE TRANSPORT SECTOR FROM THE OTHER FACTORS OF DEVELOPMENT AND IN PARTICULAR FROM THE EFFECT OF MEASURES CONCERNING AGRICULTURAL POLICY . MORE SPECIFICALLY, THE APPLICANT GOVERNMENT, WHICH DOES NOT DENY THE EXISTENCE OF SUCH AN EFFECT, REFERS TO A PASSAGE IN THE STATEMENT OF REASONS WHICH ACCEPTED THAT THE CHANGE IN AGRICULTURAL STRUCTURES HAD NOT YET BEEN ACHIEVED WHEN THE AUTHORIZATION IN DISPUTE WAS GRANTED .

14 HOWEVER, THE PURPOSE OF THIS PASSAGE IN THE STATEMENT OF REASONS WAS MERELY TO PERMIT THE CONCLUSION TO BE DRAWN THAT, INASMUCH AS THEY ARE LIMITED AS TO TIME, CERTAIN TEMPORARY AIDS MAY STILL BE GRANTED WITHOUT ADVERSELY AFFECTING THE PROPER FUNCTIONING OF THE COMMON ORGANIZATION OF THE MARKETS IN FRUIT AND VEGETABLES . THE APPLICANT CANNOT THEREFORE INVOKE THE GROUNDS FOR A TEMPORARY AUTHORIZATION IN ORDER TO INFER THE EXISTENCE OF AN OBLIGATION TO GRANT AN AUTHORIZATION OF INDEFINITE DURATION .

15 IT FOLLOWS FROM THE FOREGOING THAT THE GROUNDS OF COMPLAINT PUT FORWARD CANNOT BE ACCEPTED AND THE APPLICATION MUST THEREFORE BE DISMISSED .

16 UNDER ARTICLE 69(2 ) OF THE RULES OF PROCEDURE THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS . THE APPLICANT HAS FAILED IN ITS SUBMISSIONS . IT MUST THEREFORE BE ORDERED TO PAY THE COSTS OF THE ACTION .

THE COURT

HEREBY :

1 . DISMISSES THE APPLICATION;

2 . ORDERS THE APPLICANT TO PAY THE COSTS OF THE ACTION .