ORDER OF THE COURT (Fifth Chamber)

12 July 2012 (*)

(Appeal – Rules governing the payment of expenses and allowances to Members of the European Parliament – Review of the use of allowances – Parliamentary assistance allowance – Justification of expenditure – Recovery of undue payments)

In Case C‑278/11 P,

APPEAL under Article 56 of the Statute of the Court of Justice of the European Union, brought on 6 June 2011,

Densmore Ronald Dover, former Member of the European Parliament, residing in Borehamwood, Hertfordshire (United Kingdom), represented by D. Vaughan QC, M. Lester, Barrister, instructed by R. Collard, Solicitor, with an address for service in Luxembourg,

applicant,

the other party to the proceedings being:

European Parliament, represented by D. Moore and M. Windisch, acting as Agents, with an address for service in Luxembourg,

defendant at first instance,

THE COURT (Fifth Chamber),

composed of M. Safjan, President of the Chamber, J.‑J. Kasel (Rapporteur) and M. Berger, Judges,

Advocate General: J. Kokott,

Registrar: A. Calot Escobar,

after hearing the Advocate General,

makes the following

Order

1        By his appeal, Mr Dover seeks to have set aside the judgment of 24 March 2011 in Case T‑149/09 Dover v Parliament (‘the judgment under appeal’), by which the General Court of the European Union dismissed his action for the annulment of Decision D (2009) 4639 of the Secretary-General of the European Parliament of 29 January 2009 concerning the recovery of sums paid by way of parliamentary allowances (‘the contested decision’).

 Legal context

2        Article 13(1) of the Rules governing the payment of expenses and allowances to Members of the European Parliament (‘the PEAM Rules’) provides that:

‘Members shall be entitled to a monthly lump sum allowance at the rate currently fixed by the Bureau to meet expenditure resulting from their activities in their capacity as Members not covered by other allowances under these Rules (hereinafter referred to as the “general expenditure allowance”).

All payments under the general expenditure allowance shall be made directly to the Member concerned.

This allowance is intended to cover, inter alia, the following expenses incurred in the Member State of election:

–        travel and ancillary expenses,

–        office management and running costs, in particular rent and related charges (heating, lighting, insurance, cleaning),

–        the cost of purchasing or renting office equipment,

–        telephone and postage,

–        the purchase of office supplies,

–        the cost of purchasing books, periodicals and newspapers,

–        the cost of using public data consultation networks,

–        the expenses involved in equipping Members of Parliament with communications equipment …,

–        the cost of a subscription to the Internet and to databases,

–        the cost of purchasing, using or maintaining a telecopier.

The allowance may not be used to cover personal expenses or to finance subsidies or gifts of a political nature.’

3        Under Article 14(1) to (5) of the PEAM Rules, in the version in force in July 1999:

‘1. Subject to compliance with the provisions of paragraphs 2 and 3, Members shall be entitled to an allowance (hereinafter called the secretarial assistance allowance) to cover the expenses arising from the employment of or the engagement of the services of one or more assistants. …

2. All payments under the secretarial assistance allowance shall be paid directly on the Member’s personal instructions and on his responsibility either to the assistant or to a paying agent instructed by the Member to manage the Member’s secretarial assistance allowance. Only payments made by the Member in respect of his assistant in his capacity as employer may be reimbursed to him on production of duly receipted supporting documents: social security, taxes, pensions contributions, travel expenses or paying agent’s fees. …

3. Members shall submit to the Members’ Allowances Service a signed application for a secretarial assistance allowance, certifying that a contract has been duly concluded, in accordance with relevant national legislation, between the Member and an assistant. This contract is a private legal contract, and the European Parliament may under no circumstances be considered to be the employer or contractual partner of the assistant. The Member shall be required to comply with the relevant legal provisions, including tax and, where appropriate, social security provisions. …

4. The application shall at all events include the following information:

(a)      the name of the Member and the name, address, nationality and the country, date and place of birth of the assistant;

(b)      the length of the period of payment of the allowance, the amount(s) to be paid and the schedule for payment;

(c)      the name and address of the bank(s) and the name(s) and number(s) of the bank account(s) to which the payments are to be transferred;

(d)      the signature of the assistant confirming that the information relating to the contract concluded with the Member is correct and agreeing to all the terms laid down in the application.

5. The Member shall send the Members’ Allowances Service details of any changes to be made in respect of the application, and shall inform the assistant thereof. A new application must be submitted, however, for the continuation or renewal of the allowance. …’

4        Under Article 14(1) to (6) of the PEAM Rules, as amended by the decision of the Bureau of the Parliament of 13 December 2006:

‘[1.] Members shall be entitled to the reimbursement of expenses arising from the employment or from the engagement of the services of one or more assistants in accordance with the conditions laid down in the Codex [for Parliamentary Assistants in the European Parliament]. Expenditure incurred in connection with traineeship agreements, as referred to in Part II of the Codex [for Parliamentary Assistants in the European Parliament] may also be reimbursed.

2 (a) To obtain reimbursement of parliamentary assistance expenses in accordance with paragraph 1, the Member shall submit an application for reimbursement accompanied by a copy of the employment contract concluded between the Member and an assistant, together with, where appropriate, a copy of the contract with a paying agent or a copy of the contract for the provision of services concluded between the Member and a service provider.

(b)      Where, pursuant to Article 4 of the Codex [for Parliamentary Assistants in the European Parliament], several Members have jointly employed or engaged the services of a single assistant, a separate application shall be submitted by each Member, giving details of the amounts of all payments.

3.      The application, signed and dated by the Member, shall be deposited with the management service and processed under the authority of the Quaestors. It shall contain the following details:

–        the attached contract(s) and the type of assistance concerned;

–        the Member’s instructions as to the payments and identification of the beneficiary/beneficiaries.

4.      The Member shall notify to the management service any changes to be made in respect of the application for reimbursement and/or to the contract by submitting an application for amendment. He or she shall inform the other contracting party (or parties) thereof.

5(a)       In respect of employment contracts, the Member shall forward to the management service, within three months of the assistant taking up his or her duties, a certificate of the assistant’s membership of a social security scheme and, where the national law applicable so provides, a certificate of insurance covering accidents at work, failing which payments relating to the assistant concerned shall be suspended.

(b)      In addition, the Member shall, for the period laid down by the applicable national legislation and for no less than one year after the end of the parliamentary term, keep a pay statement record book itemising sums paid by way of remuneration and tax and social security deductions (paid by the employee and the employer).

(c)      Where the Member has contracted a paying agent to handle the administrative management of contracts, the paying agent shall forward to the Member, at least once a year, as well as on expiry of the contract, statements of the expenditure incurred in respect of salaries, social security contributions, tax payments or any other refundable expenditure. Copies of those statements drawn up in accordance with the professional standards laid down by the national law applicable shall be forwarded to the management service.

(d)      Members may apply for all or part of the parliamentary assistance expenses to be paid to a political group in the European Parliament only if the latter acts as a paying agent within the meaning of subparagraph 5.c. and provided that an application for reimbursement has been submitted in accordance with paragraphs 2 and 3.

6(a) The service contract may provide for monthly payments being made as advance payments. The invoices or fee statements showing the provision of services and, where appropriate, regularising the advance payments made and determining any outstanding balance, shall be drawn up, in accordance with the national law applicable, for a period not exceeding 12 months. The Member shall keep the invoices or fee statements for the period laid down by the applicable national legislation and for no less than one year after the end of the parliamentary term.

(b)      The service provider shall forward to the Member at least once a year, as well as on expiry of the contract, a statement of the amounts invoiced, accompanied by a declaration certifying that all tax and social security obligations resulting from the applicable national legislation are complied with. The Member shall forward a copy of the statement and the accompanying declaration to the management service, authorising the regularisation of the advance payments made.’

5        Under Article 15(1) of the PEAM Rules, in the version in force in July 1999:

‘The maximum amount of the secretarial assistance allowance shall be at the rate currently fixed by the Bureau.’

6        Under Article 15(1) of the PEAM Rules, as amended by the decision of the Bureau of the Parliament of 13 December 2004:

‘The maximum amount of the secretarial assistance allowance shall be fixed annually by the Bureau.’

7        Under Article 27(3) and (4) of the PEAM Rules, in the version in force since 12 February 2003:

‘3. Where the Secretary-General, in consultation with the Quaestors, is satisfied that undue sums have been paid by way of allowances provided for Members by these Rules, he shall give instructions for the recovery of such sums from the Member concerned.

4. In exceptional cases, and on a proposal submitted by the Secretary‑General after consulting the Quaestors, the Bureau may, in accordance with Article 73 of the Financial Regulation and its implementing rules, instruct the Secretary-General temporarily to suspend the payment of parliamentary allowances until the Member has repaid the sums improperly used.

The Bureau’s decision shall be taken with due regard for the effective exercise of the Member’s duties and the proper functioning of the Institution, the views of the Member concerned having been heard before the adoption of the said decision.’

 The facts at the origin of the dispute

8        The facts at the origin of the dispute are set out in paragraphs 7 to 31 of the judgment under appeal, as follows:

‘7      The applicant, Mr Densmore Ronald Dover, a British national, was a Member of the European Parliament from July 1999 to June 2009.

8      On 15 July 1999, the applicant entered into a parliamentary assistance agreement with MP Holdings Ltd [“MP Holdings”]. That company was set up in Hertfordshire (United Kingdom) in 1991 by the applicant and his wife, who were directors of the company. According to the applicant, the object of the company was transportation surveying and the retail sale of sports goods.

9      When the applicant was elected as a Member of the Parliament he resigned his directorship in MP Holdings, which he had held since 1991, and transferred all his shares to his wife and daughter, who became directors of that company.

10      Under the contract of 15 July 1999, MP Holdings acted as paying agent pursuant to Article 14(2) of the PEAM Rules, as in force at that time. The parties to that contract terminated it on 31 December 2000 and entered into a new contract with effect from 1 January 2001, which was renewed on 28 June 2004, following the applicant’s re-election to the Parliament. Under the latter two contracts, MP Holdings was no longer a party as a paying agent but as a provider of parliamentary assistance services. Those contracts, governed by English law, were based on the standard contracts prepared by the Parliament’s services for use by Members, and were required to be attached to applications for reimbursement, with effect from 1 January 2001, under the amendments to Article 14 of the PEAM Rules.

11      Following his election to the Parliament, the applicant submitted, under Article 14(2) of the PEAM Rules, applications for reimbursement of the parliamentary assistance expenses incurred by MP Holdings. Those applications resulted in the monthly reimbursement of the relevant expenses.

12      By letter of 20 December 2006, the President of the College of Quaestors asked the applicant to indicate the reasons why his contractual link with MP Holdings was not characterised by a conflict of interests.

13      By e-mail of 29 March 2007, the applicant explained, inter alia, that he had no interest in MP Holdings.

14      By letter of 6 June 2008, the Secretary-General of the Parliament asked the applicant to state whether he or one of his first-degree relatives owned or had owned MP Holdings since 1999, whether any of those persons participated or had participated during that period on the board of directors of that company, whether any of those persons had or had had access to the bank accounts of that company and, finally, whether any of those persons had or had had any other personal interest in that company.

15      In the event of a reply in the affirmative to any of those questions, the Secretary-General asked the applicant to provide documents showing that the sums paid to MP Holdings [had been] used solely to cover parliamentary assistance expenses incurred. The Secretary-General also informed the applicant that, in the event of failure to demonstrate that fact, the sums in question might be recovered. Moreover, the applicant was informed that the competent services of the Parliament had been instructed to suspend all payments to MP Holdings.

16      At a meeting held on 25 June 2008 with the Head of Cabinet of the Secretary-General of the Parliament, the applicant submitted to the Parliament’s services a set of documents relating to the use of the parliamentary assistance allowance.

17      By letter of 14 October 2008, the Secretary-General acknowledged receipt of those documents and set out the relevant findings of the Parliament’s services.

18      Those findings were as follows: first, there was no clear distinction between the expenses of MP Holdings, on the one hand, and the personal expenses of the applicant and his family, on the other hand. Secondly, the applicant and his wife and daughter were financially involved in MP Holdings in ways which could not be defined with precision on the basis of the documentation provided by the applicant. Thirdly, according to the documentation which the Parliament’s services had received, some categories of expenditure should not have been covered by the parliamentary assistance allowance. Fourthly, certain expenses were not sufficiently substantiated by supporting documents. Fifthly, there were a number of inconsistencies in MP Holdings’ accounts. Sixthly, the Parliament’s services received no explanation of the failure to invoice value added tax (“VAT”) for the parliamentary assistance services provided to the applicant by MP Holdings, despite the fact that, in respect of other transactions, MP Holdings was liable to VAT.

19      In conclusion, the Secretary-General observed that it was very difficult, if not impossible, to determine on the basis of the documents presented by the applicant whether the amounts paid by the Parliament had been spent in compliance with the PEAM Rules. Those documents did not contain adequate justification for all the sums in question.

20      Thus, of the GBP 959 446.48 which MP Holdings had received by way of parliamentary assistance allowances for the period from August 1999 to June 2008, only GBP 421 156 could [have been] considered to be properly justified in terms of miscellaneous emoluments, social security contributions and travel allowances paid to the applicant’s wife and daughter.

21      The Secretary-General made it clear that, if additional justification of the difference between those two amounts, namely GBP 538 290.48, GBP 538 290 in round figures, were not produced by 31 October 2008, he would inform the European Anti-Fraud Office (OLAF) and would initiate the recovery procedure laid down in Article 27(3) of the PEAM Rules.

22      By letter of 15 October 2008, the applicant informed the Secretary General that he would endeavour to justify all the sums in question, that he had terminated the contract he had with MP Holdings with effect from 14 October 2008 and that he agreed to repay the sum of GBP 36 012.53.

23      By letter of 24 October 2008, the Secretary-General welcomed the applicant’s willingness to repay the sum of GBP 36 012.53 but reminded him that, in the absence of appropriate responses to all the questions raised in the letter of 14 October 2008 (see paragraphs 17 to 21 above), he would initiate the recovery procedure under Article 27(3) of the PEAM Rules and submit the case to OLAF.

24      By letter of 28 October 2008, the applicant informed the Secretary General that he had, on the previous day, provided certain documents to his Head of Cabinet and that he was willing to repay the Parliament the sum of GBP 104 894.67.

25      By letter of 5 November 2008, the Secretary-General [expressed] doubts as to the applicant’s use of cars for the purposes of his parliamentary duties. He also noted that certain expenditure should have been covered by the general expenditure allowance in accordance with Article 13 of the PEAM Rules and made further comments concerning the costs of sending information material and of travel, as well as the failure of MP Holdings to invoice VAT. The Secretary-General concluded that, in those circumstances, he was still obliged to request the repayment of GBP 538 290, as stated in his letter of 14 October 2008 ...

26      By letter of 8 November 2008, the applicant referred to a meeting with the Secretary-General’s Head of Cabinet on 5 November and confirmed his intention expressed at that meeting to repay the amount of GBP 538 290 before the end of the then current parliamentary term in full and final settlement.

27      By letter of 11 November 2008, the Secretary-General, in his capacity as the Parliament’s Principal Authorising Officer sent the applicant a debit note, within the meaning of Article 78(3) of Commission Regulation (EC, Euratom) No 2342/2002 of 23 December 2002 laying down detailed rules for the implementation of Council Regulation (EC, Euratom) No 1605/2002 on the Financial Regulation applicable to the general budget of the European Communities (OJ 2002 L 357, p. 1), in the sum of GBP 538 290. That sum was … repaid no later than 13 July 2009, the date of the end of the applicant’s mandate, and could also [have] [been] partially offset against certain claims which the applicant retained vis-à-vis the Parliament. Finally, the Secretary-General informed the applicant that he would forward that letter and supporting evidence to OLAF.

28      By letter of 19 November 2008, the applicant informed the Secretary-General of the withdrawal of his agreement to pay GBP 538 290 for two reasons. First, the Secretary-General had informed OLAF and, secondly, the confidentiality of the case had been broken and the British press had published reports of the matter.

29      On 3 December 2008 the applicant submitted to the Parliament an application for reimbursement of parliamentary assistance expenses based on parliamentary assistance contracts which he had signed directly with his wife and his daughter. Under that application, the payments [were] made to a chartered accountant acting as paying agent.

30      By letter of 23 December 2008, the applicant made a number of comments on the procedure and on the substance of the case.

31      By a note dated 14 January 2009, the Secretary-General informed the Quaestors and proposed the application of the procedure provided for by Article 27(3) of the PEAM Rules. To that end, the Secretary-General attached a draft decision to that note. In addition, the Secretary-General sought the Quaestors’ opinion on the application of Article 27(4) of the PEAM Rules in the present case.’

 The contested decision

9        In so far as concerns the contested decision, the General Court stated the following in paragraphs 32 to 50 of the judgment under appeal:

‘32      By letter of 30 January 2009, the Secretary-General notified the applicant of a decision dated 29 January 2009 (“the contested decision”). Under the contested decision, the Secretary-General decided, in particular, that the amount of GBP 538 290 had been unduly paid to the applicant and that the authorising officer by delegation was to take all necessary steps to recover that sum. In addition, the Secretary-General stated that the contested decision might be reviewed in the light of any new evidence submitted by the applicant or gathered by OLAF and any decision of a national judicial or tax authority.

33      A new debit note was attached to the letter of 30 January 2009, replacing the debit note of 11 November 2008 … and asking the applicant to repay the sum in question no later than 25 April 2009.

34      According to the fifth and sixth recitals in the preamble to the contested decision, the Secretary-General held a hearing with the applicant and consulted the Quaestors on 9 October 2008 and 14 January 2009 respectively.

35      According to recitals 17 to 23 in the preamble to the contested decision, the parliamentary assistance allowance is exclusively intended to pay expenses resulting from parliamentary assistance contracts and must not therefore be misused so as to amount to disguised remuneration of the recipient Member. Any sum paid by way of parliamentary assistance allowance but used for purposes not covered by Article 14 of the PEAM Rules must therefore be considered to have been unduly paid and should therefore be recovered.

36      In that regard, recital 24 in the preamble to the contested decision states that the parliamentary assistance allowance provided for in Article 14 of the PEAM Rules does not cover the purchase or maintenance of movable property, such as cars used for private purposes, equipment intended for the office in the Member’s country of origin, or communication costs. Moreover, the allowance in question does not cover the purchase, rent or renovation of immovable property belonging to or used by a Member, or subsistence costs for travel, or expenses for the production and dispatch of information material. Also excluded from that allowance are donations to a political party and entertainment expenses. Most of those cost categories are, however, covered by other parliamentary allowances.

37      In the light of those considerations, recital 25 in the preamble to the contested decision states that the following sums had been unduly paid, at the very least, under the terms of Article 14 of the PEAM Rules:

–        GBP 101 068 in respect of expenses for running three cars;

–        GBP 15 404 in respect of expenses for the purchase and maintenance of office supplies and equipment;

–        GBP 89 235 in respect of printing, postage and stationery costs;

–        GBP 100 735 in respect of the rental costs and costs of renovation work to the property of the applicant used as his office space;

–        GBP 200 in respect of donations made to the UK Conservative party;

–        GBP 17 880 in respect of the applicant’s entertainment expenses;

–        GBP 20 767 corresponding to telephone expenses of the applicant.

38      According to recital 26 in the preamble to the contested decision, those examples of undue payments illustrate continuing misuse of monies paid by the Parliament since 1999. Consequently, the Parliament should recover all sums which have not been duly justified by the applicant as having been used for the proper purposes of Article 14 of the PEAM Rules.

39      Recitals 27 to 33 in the preamble to the contested decision deal with the question of the invoicing of VAT by MP Holdings in respect of services provided to the applicant and with the subsequent payment of that VAT to the UK tax authority.

40      In that regard, recital 29 in the preamble to the contested decision refers to the applicant’s letter of 24 October 2008, in which he stated that MP Holdings had never issued invoices for the services it had provided and that, by those means, the imposition of value added tax had been avoided. That situation was a breach of both Community law on VAT and Article 14 of the PEAM Rules, which required invoices to be issued.

41      In those circumstances, according to recital 31 in the preamble to the contested decision, the Parliament should decline to recover such sums paid to a provider of parliamentary assistance services by way of VAT in respect of those services only where the Member concerned provides evidence that the company has paid the national authority the sums due in accordance with the applicable legislation. It follows, according to recital 32 in the preamble to the contested decision, that all sums which ought to have been paid by MP Holdings to the UK authorities from August 1999 to June 2008 must be recovered.

42      The total amount to be recovered, on the basis of a VAT rate of 17.5% applied to the total amount of GBP 959 446.48, is GBP 167 903.13 (recital 33 in the preamble to the contested decision).

43      Moreover, according to recitals 34 to 39 in the preamble to the contested decision, the facts underlying the payment of the parliamentary assistance allowance must not be characterised by conflicts of interest, arising in particular where the Member concerned concludes contractual relations with entities in which he has a financial or other interest.

44      Conflicts of interest may be observed where members of the Member’s family are on the board of a provider of parliamentary assistance services, where the offices of that provider are situated in a property owned by the Member, for the use of which the provider pays costs, or even where the Member concerned lends sums of money to that provider which are reimbursed using the amounts received by way of parliamentary assistance allowance.

45      It is clear from the documents reviewed by the Parliament’s services that the applicant still made loans to MP Holdings, even after he ceased to be a director of that company, and that a large number of invoices issued in the name of the applicant or members of his family were paid by MP Holdings and vice versa (recitals 42 and 43 in the preamble to the contested decision).

46      It is also stated in the contested decision that the two premises used by MP Holdings are moreover the property of the applicant and his family members and [that] part of the related costs [was] attributed to MP Holdings each year on a lump-sum basis using a system of loans, while some repairs to the premises have also been paid for by the company. Finally, the statements for the credit cards used by the applicant’s wife and daughter for the payment of the expenses of MP Holdings are in the name of the applicant (recitals 44 and 45 in the preamble to the contested decision).

47      On the basis of the above considerations, it was concluded that the applicant had not provided adequate justification for all the amounts received by MP Holdings by way of parliamentary assistance allowance. In particular, the applicant had produced evidence justifying the use of GBP 421 156 by way of parliamentary assistance, and GBP 538 290 had to be refunded to the Parliament on the three grounds identified in paragraphs 36 to 38, 39 to 42 and 43 to 46 above respectively (recitals 48 to 53 in the preamble to the contested decision).

48      Thus, according to the operative part of the contested decision, the amount of GBP 538 290 was unduly paid to the applicant and the authorising officer by delegation of the Parliament [was] instructed to take all necessary steps to recover the sum from the applicant. It is also stated that the Parliament reserves the right to review the contested decision if new evidence is submitted to it by the applicant, by OLAF or by any other national judicial or tax authority.

49      By letter of 5 February 2009, the Secretary-General informed the applicant of his decision to initiate the procedure under Article 27(4) of the PEAM Rules, under which the recovery of the amount of GBP 538 290 may also be effected by offsetting against certain sums payable to the applicant by the Parliament.

50      That procedure resulted in a decision of the Secretary-General dated 28 April 2009, under which he decided to recover the sums due to the Parliament by offsetting against certain sums payable to the applicant by the Parliament.’

 Procedure before the General Court and the judgment under appeal

10      By application lodged at the Registry of the General Court on 10 April 2009, Mr Dover brought an action seeking annulment of the contested decision. In support of his action, he put forward five pleas in law, alleging in essence: (i) misapplication of Article 14 of the PEAM Rules; (ii) inapplicability of the notion of conflict of interests; (iii) infringement of Article 27 of the PEAM Rules; (iv) infringement of the VAT rules; and (v) infringement, through the decision to refer the case to OLAF, of Article 7 of Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) (OJ 1999 L 136, p. 1).

11      By the judgment under appeal, the General Court annulled the contested decision as regards the recovery of the sum of GBP 193 001. That sum was made up, first, of the sum of GBP 25 097.87, being the total amount claimed by way of repayment, in relation to which the General Court held, when analysing the first plea in paragraphs 109 to 120 of the judgment under appeal, that the statement of reasons in the contested decision was inadequate and, second, the sum of GBP 167 903.13, corresponding to the VAT which the provider of parliamentary assistance services omitted to declare to the United Kingdom authorities and of which the Parliament was not entitled to claim reimbursement from Mr Dover, as is apparent from the analysis made by the General Court of the fourth plea in paragraphs 148 to 158 of the judgment under appeal.

12      The General Court dismissed the remainder of the action.

13      In that regard, the General Court considered, first of all, in paragraphs 97 to 108 of the judgment under appeal, after setting out the case‑law applicable when the duty to state reasons required by Article 253 EC is assessed, that the reasons why it was appropriate to exclude from the allowances received under Article 14 of the PEAM Rules the seven items listed in recital 25 to the contested decision, representing a total of GBP 345 289, were adequately set out in recital 24 to that decision.

14      Next, as regards the examination of the validity of those reasons, the General Court found, in paragraphs 121 to 123 of the judgment under appeal, that all of the arguments raised by Mr Dover relate to the fact that he claims to have submitted the necessary documents to justify being awarded the amounts at issue. However, in the view of the General Court, the fact that Mr Dover fulfilled the conditions for that allowance to be granted gives no clear indication of his actual use of the allowance, which the Parliament must be able to review under Article 27(3) of the PEAM Rules, where necessary, by demanding documents to prove how the allowance was used.

15      After noting that the definition of parliamentary assistance is not a matter for the discretion of Members, the General Court held in paragraphs 129 and 130 of the judgment under appeal that the use of the amounts listed in recital 25 to the contested decision, which has not been disputed by Mr Dover, is not connected with the employment or engagement of the services of parliamentary assistants.

16      Lastly, as regards the argument relating to the application of the notion of conflict of interests, the General Court held, in paragraphs 166 to 169 of the judgment under appeal – after noting that that notion cannot relate to a specific sum, but affects all the amounts paid by the Parliament to Mr Dover – that the alleged conflict of interests had not had substantive consequences as regards the amounts reclaimed. In so far as that argument is not such that it affects the outcome of the case, the General Court rejected it as ineffective.

 Forms of order sought before the Court of Justice

17      Mr Dover submits that the Court should:

–        overturn the ‘contested parts’ of the judgment under appeal;

–        annul the contested decision;

–        order the Parliament to pay the costs of this appeal and of the proceedings before the General Court.

18      The Parliament contends that the appeal should be dismissed and the appellant ordered to pay the costs.

 The appeal

19      Under Article 119 of its Rules of Procedure, where an appeal is, in whole or in part, clearly inadmissible or clearly unfounded, the Court of Justice may at any time, acting on a report from the Judge-Rapporteur and after hearing the Advocate General, by reasoned order dismiss the appeal in whole or in part, without opening the oral procedure.

20      Mr Dover raises three grounds of appeal. By his first ground, he submits that the General Court erred in law in considering that sufficient grounds were provided in the contested decision in relation to the obligation to repay the sum of GBP 345 289. By the second ground of appeal, he alleges an erroneous application by the General Court of the PEAM Rules. By his third ground of appeal, Mr Dover submits that the General Court erred in law in failing to draw the proper inferences from the fact that the Parliament was prohibited from relying on conflict of interests as grounds for its claim for reimbursement of the parliamentary allowances at issue.

 Preliminary observations

21      At the outset, Mr Dover calls on the Court of Justice to apply different principles as a result, inter alia, of the fact that the contested decision entails heavy financial consequences for him. The first principle relates to compliance, by the Parliament, with the duty to state the reasons for any decisions which adversely affect individuals, both to enable such persons to defend their rights and to enable the European Union Court hearing the case to review the legality of the Community measure at issue. The second principle concerns compliance, by the European Union institutions, with the right of all individuals to be heard before having a penalty imposed on them. The third relates to compliance, by the Parliament, with the procedural guarantees which prevent it from abusing its powers.

22      The Parliament contends that Mr Dover’s claims do not constitute grounds of appeal in that they merely repeat the arguments already raised at first instance.

23      The Court notes that, under Article 256 TFEU and the first paragraph of Article 58 of the Statute of the Court of Justice of the European Union, an appeal is limited to points of law and must be based on the grounds of lack of competence of the General Court, of breach of procedure before that court which adversely affects the interests of the appellant, or infringement of Community law by the General Court (see, to that effect, Case C‑136/92 P Commission v Brazzelli Lualdi and Others [1994] ECR I‑1981, paragraph 47).

24      Moreover, it follows from the above provisions, and from Article 112(1)(c) of the Rules of Procedure of the Court of Justice, that an appeal must state precisely the contested elements of the judgment which the appellant seeks to have set aside and also the legal arguments specifically advanced in support of the appeal (see, inter alia, Case C‑352/98 P Bergaderm and Goupil v Commission [2000] ECR I‑5291, paragraph 34; Joined Cases C‑189/02 P, C‑202/02 P, C‑205/02 P to C‑208/02 P and C‑213/02 P Dansk Rørindustri and Others v Commission [2005] ECR I‑5425, paragraph 426; and Case C‑280/08 P Deutsche Telekom v Commission [2010] ECR I‑9555, paragraph 24).

25      According to settled case‑law, an appeal which simply repeats or reproduces verbatim the pleas in law and arguments already submitted before the General Court, including those based on factual allegations expressly dismissed by that Court, seeks, in reality, reconsideration of the application submitted at first instance, which falls outside the jurisdiction of the Court of Justice (see, inter alia, Case C‑131/03 P Reynolds Tobacco and Others v Commission [2006] ECR I‑7795, paragraphs 49 and 50, and the order of 31 March 2011 in Case C‑367/10 P EMC Development v Commission, paragraph 102).

26      The Court notes that, by his preliminary arguments, Mr Dover merely repeats the general principles relating to the rights of the defence, without making a more precise reference to one of the three grounds of appeal or contesting any specific aspect of the judgment under appeal.

27      However, the mere assertion that the judgment under appeal should be analysed in the light of those general principles, with no further details being given of the aspects of that judgment with which the appellant takes issue, is too general and imprecise to be assessed by the Court (see, to that effect, Case C‑51/92 P Hercules Chemicals v Commission [1999] ECR I‑4235, paragraph 113).

28      Consequently, since those preliminary arguments are not sufficiently detailed, they must be rejected as manifestly inadmissible.

 The first ground of appeal

 Arguments of the parties

29      Mr Dover submits that the General Court explained correctly the obligation on the Parliament to give proper reasons, and rightly considered that the Parliament had failed in its duty to give reasons as regards the claim for recovery of the sum of GBP 25 097.97. By contrast, as regards the claim for the recovery of the sum of GBP 345 289, he submits that the General Court was wrong in holding that it was adequately reasoned.

30      According to Mr Dover, the reasons given by the Parliament in recitals 24 and 25 to the contested decision, on which the General Court based the judgment under appeal, were not sufficient. Consequently, Mr Dover was not permitted to know the reasons why he was being ordered to repay the amounts listed in recital 25. The Parliament simply asserted that it had clear documentary evidence, without identifying that evidence. Moreover, the documents in the file submitted to the General Court give the impression that the reason underlying the claim for recovery of the allowances was that, because of MP Holdings, Mr Dover found himself in a situation of conflict of interests, whereas the General Court rightly held that the Parliament could not rely on conflict of interests to justify full recovery of the sums at issue.

31      The Parliament contends, first of all, that, by his first ground of appeal, Mr Dover seeks an acknowledgement that the General Court erred in law in its assessment of the substance of the grounds of the contested decision. However, the Parliament states that the paragraphs of the judgment under appeal complained of by Mr Dover in the context of his first ground of appeal, namely paragraphs 103 and 108, must be read in their context. Those paragraphs are situated in the part of the judgment concerning the General Court’s reasoning regarding the complaint alleging a lack of reasoning in the contested decision and are thus unrelated to the issue of whether the grounds of that decision are well founded, which was analysed by the General Court in paragraphs 121 to 131 of the judgment under appeal.

32      Next, as regards the claims made against it, the Parliament argues that they are unrelated to the question whether the General Court committed an error of law in the judgment under appeal.

33      Lastly, the Parliament contends that the judgment under appeal makes no reference to the impression, alluded to by Mr Dover, that the claim for recovery was based entirely on the alleged conflict of interests. On the contrary, the General Court stated explicitly in paragraph 168 of the judgment under appeal that adequate reasons were given for the recovery of the sum of GBP 345 289, irrespective of the issue whether the Parliament was able to rely on conflict of interests.

 Findings of the Court

34      By his first ground of appeal, Mr Dover accuses the General Court of misapplying the principles of which account must be taken in assessing whether the Parliament has fulfilled its duty to state reasons.

35      Accordingly, Mr Dover claims that the grounds provided by the Parliament, on which the General Court relied in paragraphs 103 and 108 of the judgment under appeal, were not sufficient and did not permit him to know the reasons why he was ordered to reimburse the sums mentioned or to challenge the substance of those grounds. Mr Dover adds that, in any event, the Parliament’s reliance on conflict of interests cannot constitute a reason justifying the claim for full recovery of the sums at issue.

36      The Court notes, in that regard, that the obligation to state reasons for decisions constitutes an essential procedural requirement which must be distinguished from the question of the merits of those reasons, which concern the substantive legality of the contested measure. The reasoning of a decision consists in a formal statement of the grounds on which that decision is based. The grounds may be adequate even though they set out reasons which are incorrect (see, inter alia, Case C‑413/06 P Bertelsmann and Sony Corporation of America v Impala [2008] ECR I‑4951, paragraph 181 and the case‑law cited).

37      As is apparent from paragraph 97 of the judgment under appeal, the General Court sought, in the first part of its reasoning, to adopt a position on the argument raised by Mr Dover alleging a lack of grounds in the contested decision, by stating that the total amount of the allowances at issue, which were claimed back from Mr Dover, was not calculated in a way which enabled him to identify the specific sums which he had been paid unduly. That part of the reasoning is set out in paragraphs 97 to 120 of the judgment under appeal, entitled ‘The statement of reasons for the contested decision’.

38      The General Court considered, in paragraph 103 of the judgment under appeal, that the part of the contested decision relating to the scope of Article 14 of the PEAM Rules – and, in particular, recital 25 – lists seven items totalling GBP 345 289 and that the reasons why, according to the Secretary-General, those amounts must be excluded from the allowances that may be received under Article 14 of the PEAM Rules are adequately stated in recital 24 to the contested decision. The General Court added that it was clear from consideration of those recitals – the content of which is summarised in paragraphs 36 and 37 of the judgment under appeal – that the reasoning for each of the amounts listed in recital 25 to the contested decision is to be found in recital 24.

39      After providing detailed information in paragraphs 105 to 107 of the judgment under appeal regarding the sums which make up the total amount claimed back by the Parliament, the General Court held, in paragraph 108 of the judgment under appeal, that the contested decision contained reasons which meet the criteria laid down in Article 253 EC in respect of the sums of GBP 345 289 and GBP 167 903.13, but that, by contrast, as regards the sum of GBP 25 097.87, corresponding to the difference between the two amounts referred to above and the total amount for which reimbursement is claimed, namely GBP 538 290, the contested decision did not contain reasons.

40      It is apparent from the foregoing that the grounds on which the General Court relied in paragraphs 103 and 108 of the judgment under appeal comply with the formal duty to state reasons as laid down in Article 253 EC.

41      In so far as Mr Dover also seeks, by his complaints directed against those same paragraphs 103 and 108 of the judgment under appeal, to contest the substance of the contested decision, he is acting on a misreading of that judgment.

42      The issue as to whether the grounds of the contested decision are sound is addressed in paragraphs 121 to 130 of the judgment under appeal, in the part of the grounds entitled ‘The complaints concerning the validity of the reasons on which the contested decision is based’, in which the General Court gave judgment on the arguments raised by Mr Dover regarding the failure to use the amounts listed in recital 25 to the contested decision in accordance with the PEAM Rules.

43      The first ground of appeal must therefore be rejected as manifestly unfounded.

 The second ground of appeal

 Arguments of the parties

44      By his second ground of appeal, Mr Dover accuses the General Court of being wrong in finding that the Parliament was justified in asserting in the contested decision that the amounts listed in recital 25 thereto were not used in accordance with the PEAM Rules, even though the Parliament did not explain anywhere the reasons why it considered that the numerous documents submitted by Mr Dover did not prove that the amounts had been used in accordance with those rules. In that regard, Mr Dover raises several arguments, submitting that: (i) he provided a large amount of documentary evidence for each of the amounts at issue; (ii) the explanations which he gave as to the particular items of expenditure were more than sufficient to demonstrate that he had acted consistently with the PEAM Rules; (iii) the Parliament is imposing retroactively more stringent requirements to demonstrate the actual use of the allowances, which is contrary to fundamental principles of law, legal certainty and the principle of non-retroactivity; the lack of a transparent system setting out clear requirements for the reimbursement of expenses has been heavily criticised and is the reason why Mr Dover has been penalised; (iv) the Parliament accepted that the allowances had been validly claimed and used, and Mr Dover was never asked for additional information when he submitted his requests for reimbursement; and (v) it is for the Parliament to disclose the precise facts and evidence on which it relies to challenge the validity of each item of Mr Dover’s expenditure, and to permit him to respond to each allegation.

45      The Parliament contends that the reasons which led the General Court to conclude, in paragraph 130 of the judgment under appeal, that the amounts listed in recital 25 to the contested decision do not relate to the engagement of the services of parliamentary assistants within the meaning of Article 14(1) of the PEAM Rules, are manifest. The General Court was right to find that Article 14(1) of the PEAM Rules concerns solely the reimbursement of allowances resulting from the engagement of the services of parliamentary assistants and that the amounts listed in recital 25 to the contested decision clearly do not fall within the scope of that provision. The Parliament adds that Mr Dover appears to be mistaken in relation to the notion of services of assistants when he claims that the material expenses related to the acquisition or maintenance of property belonging to the service provider could be converted into service expenses simply because they were incurred by a service provider. In the Parliament’s view, it is not the identity of the person who incurs the costs which is decisive, but the nature of the expenses.

46      The Parliament argues that, in any event, the second ground of appeal must be declared inadmissible, in so far as Mr Dover’s arguments reiterate those already expressed in the context of his initial application; that they are brought against the Parliament’s position, which, moreover, is not accurately represented; and that they do not challenge any specific aspect of the judgment under appeal.

 Findings of the Court

47      As regards the question whether the use of the amounts listed in recital 25 to the contested decision is compatible with Article 14 of the PEAM Rules, the General Court rightly stated that the parliamentary assistance allowance is exclusively intended to pay expenses resulting from parliamentary assistance contracts and cannot, therefore, cover expenses such as those listed in recital 25 relating, inter alia, to the purchase or maintenance of movable property, rent or renovation of immovable property belonging to or used by a Member, donations to a political party, or expenses for the production and dispatch of information material.

48      The Court notes that, by his second ground of appeal, Mr Dover seeks to call into question the conclusion reached by the General Court in paragraph 130 of the judgment under appeal, without however specifying the part of the General Court’s reasoning which he contests in that regard. Indeed, Mr Dover is actually reproducing some of the arguments which he raised at first instance and which were rejected by the General Court in paragraphs 122 to 128 of the judgment under appeal. Since those paragraphs are not disputed in the context of the present appeal, the arguments raised in the context of the second ground of appeal must be declared inadmissible, in accordance with the case‑law cited in paragraphs 24 and 25 above.

49      Consequently, the second ground of appeal must be rejected as manifestly inadmissible.

 The third ground of appeal

 Arguments of the parties

50      By his third ground of appeal, Mr Dover criticises the General Court for holding, in paragraphs 168 and 169 of the judgment under appeal, that the Parliament’s reliance on conflict of interests did not have consequences as regards the amounts claimed back, even though the Parliament relied on that ground to justify the total amount which it sought to recover and it should abide by the reasoning set out in the contested decision.

51      The Parliament contends that the present ground of appeal is based on a misreading of paragraph 167 of the judgment under appeal and disputes having based the entire contested decision on the ground of conflict of interests. The General Court was right to find the arguments relating to conflict of interests to be ineffective, since they in no way affect the calculation of the sum to be reimbursed.

 Findings of the Court

52      As is apparent from paragraph 166 of the judgment under appeal, the General Court, first of all, noted that the conflict of interests at issue could not relate to a specific sum paid by way of parliamentary assistance allowance, but affected the amounts paid by the Parliament to Mr Dover as a whole.

53      The General Court then stated, in paragraph 168 of the judgment under appeal, that the main issue in the present case is to establish whether the amounts received by MP Holdings were actually used for the purposes of providing parliamentary assistance services within the meaning of Article 14(1) of the PEAM Rules. It is in the context of that examination that the General Court was able to conclude, in paragraphs 129 and 130 of the judgment under appeal, that the sums referred to in recital 25 to the contested decision were properly claimed back.

54      Lastly, the General Court noted, again in paragraph 168 of the judgment under appeal, that the partial annulment of the contested decision was based in part on a failure to state reasons, in relation to the recovery of the sum of GBP 25 097.87, and in part because it was vitiated by an error of law, in relation to the recovery of the sum of GBP 167 903.13 in VAT owing to the United Kingdom authorities.

55      Consequently, the General Court was indeed able to conclude that the Parliament’s reliance on conflict of interests did not have substantive consequences for the amounts claimed back and that the arguments raised in that regard were not such that they affected the outcome of the case.

56      In so far as the arguments raised by Mr Dover in the context of the present ground of appeal merely reiterate those already raised at first instance and do not specify how the General Court’s reasoning in rejecting those arguments as ineffective was open to criticism, they must be rejected as inadmissible, for the same reasons as those set out in paragraphs 24 and 25 above. Consequently, the third ground of appeal must be dismissed as manifestly inadmissible.

57      Since none of the grounds of appeal can be upheld, the appeal must be dismissed as being in part manifestly unfounded and in part manifestly inadmissible.

 Costs

58      Under Article 69(2) of the Rules of Procedure, which applies to appeal proceedings pursuant to Article 118 thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Parliament has applied for costs and the appellant has been unsuccessful, the latter must be ordered to pay the costs of the appeal.

On those grounds, the Court (Fifth Chamber) hereby orders:

1.      The appeal is dismissed.

2.      Mr Densmore Ronald Dover is ordered to pay the costs.

[Signatures]

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* Language of the case: English.