1. 

This application by the European Parliament (‘the Parliament’) for the annulment of a measure adopted by the Council (Regulation (EEC) No 4059/89 of 21 December 1989 laying down the conditions under which nonresident carriers may operate national road haulage services within a Member State ( 1 )) requires the Court to define in particular the scope of the Parliament's right to bring actions, which was recognized, subject to certain conditions, in the ‘Chernobyl’ judgment. ( 2 )

2. 

The Parliament relies on the lack of a second consultation on the draft regulation (which became the abovementioned regulation) submitted by the Commission at the Council session in December 1989, although the draft regulation differed substantially from the initial draft submitted by the Commission on 5 December 1985 ( 3 ) and on the basis of which the Parliament gave its opinion in a resolution of 12 September 1986. ( 4 )

3. 

The Council objects that the action is inadmissible because the ‘Chernobyl’ judgment recognized the Parliament as having not a right to bring proceedings under Article 173 of the EEC Treaty, but only a right to bring an action for annulment ‘under exceptional conditions, where the balance of the system created by the Treaty is at risk, that is to say in cases where there has been a substantial breach of the essential prerogatives of the Parliament as an institution’. ( 5 ) The Council concludes that in order to be admissible the action for annulment must satisfy two conditions: first, there must be a ‘manifest and clear’ breach, and secondly, there must be a ‘manifest’ institutional imbalance.

4. 

That is not the case here because the Parliament has not challenged the legal basis of the contested regulation and because that basis, Article 75 of the EEC Treaty, does not require a cooperation procedure but simply consultation of the Parliament. The Council argues that if the result of the Court's case-law is that a second consultation of the Parliament is required only if the draft has been substantially altered, the Court will be obliged to examine the substance of the case in order to determine the admissibility of the proceedings.

5. 

By systematically relying on the lack of a second consultation, moreover, the Parliament will be able to achieve recognition of its right to challenge all acts of the Council by means of actions for annulment, maintains the Council.

6. 

It also considers that, unlike the cooperation procedure, the Parliament's opinion entails no legal consequences for the Council. It concludes that, once consultation has taken place, there is no breach of the Parliament's prerogatives as it can be advised informally of the progress of the discussions within the Council on the Commission's initial proposal.

7. 

Finally, the Council adds that, even if there were no need to make a distinction between the cooperation procedure and simple consultation of the Parliament, the right to bring actions for annulment which the Parliament has been recognized as having is an exception to the general principle laid down in Articles 4 and 173 of the EEC Treaty. The conditions for exercising it must therefore be interpreted restrictively. Consequently, it cannot be sufficient for the Parliament to allege breach of its prerogatives, since otherwise its right of action would be automatic.

8. 

The Parliament replies that it is not possible to draw from the ‘Chernobyl’ judgment the conclusion that its right to bring actions for annulment is recognized as an exception applicable only in the event of a manifest breach of its prerogatives. In any case, when in that judgment the Court declared the action admissible it referred merely to the Parliament's claim ‘that its prerogatives were breached as a result of the choice of legal basis for the contested measure’. The Council's approach would make it necessary systematically to examine the substance of a case at the admissibility stage. Finally, the right to be consulted, and therefore to be reconsulted in the event of substantial amendments to the initial proposal, is just as much a prerogative of the Parliament as is the cooperation procedure.

9. 

As Advocate General Van Gerven stated in his Opinion in the ‘Chernobyl’ case, ( 6 )‘there will certainly be difficulty ... in defining in practice the cases in which the Parliament may be regarded as acting in order to safeguard its own sphere of competence’. It remains the case, in my view, that the Court's judgment has clearly shown the right approach.

10. 

In the first place, contrary to the argument put forward by the Council, there is no mention, even implicitly, in the grounds of the Court's decision, of the Parliament's right to bring actions for annulment being an exception limited to manifest breaches of its prerogatives.

11. 

After observing that the Parliament's prerogatives

‘are one of the elements of the institutional balance created by the Treaties', ( 7 )

the Court stated that

Observance of the institutional balance means that each of the institutions must exercise its powers with due regard for the powers of the other institutions. It also requires that it should be possible to penalize any breach of that rule which may occur’ ( 8 )

and that

‘the absence in the Treaties of any provision giving the Parliament the right to bring an action for annulment may constitute a procedural gap, but it cannot prevail over the fundamental interest in the maintenance and observance of the institutional balance laid down in the Treaties establishing the European Communities’, ( 9 )

and concluded that

‘an action for annulment brought by the Parliament against an act of the Council or the Commission is admissible provided that the action seeks only to safeguard its prerogatives and that it is founded only on submissions alleging their infringement’. ( 10 )

12. 

To accept the Council's argument would be to accept that actions for annulment brought by the Parliament are inadmissible if the breach of the Parliament's prerogatives was minor or not manifest. The very basis of the approach adopted in the ‘Chernobyl’ judgment, namely strict observance of the institutional balance and the need to maintain it through judicial procedures, does not justify such a distinction.

13. 

In the second place, if the Council's argument were to be accepted, it would inevitably lead to the Court's examining the substance of the case at the admissibility stage. In the present case it would oblige the Court to determine whether prima facie the differences between the Commission's initial proposal and the regulation adopted were such that further consultation of the Parliament was obviously required, in order to enable the Court to decide whether the lack of further consultation was a maniţest breach of the Parliament's prerogatives which would make the action admissible.

14. 

There are certainly some objections of inadmissibility which require the Court to make an initial assessment of the substance. That is not why, in my opinion, the Council's argument should be regarded as erroneous; the reason is rather that there is no support for it in the grounds of the ‘Chernobyl’ judgment.

15. 

The particular conditions set out in the decision regarding the admissibility of actions for annulment brought by the Parliament are twofold. The Court requires that ‘the action seeks only to safeguard its prerogatives’, which concerns the very purpose of the proceedings, and that ‘it is founded only on submissions alleging their infringement’.

16. 

In the ‘Chernobyl’ case the Court limited itself to observing that the Parliament's prerogatives included participation in the drafting of legislative measures, in particular participation in the cooperation procedure, and that the Parliament relied on the circumstance that the legal basis erroneously chosen by the Council provided only that the Parliament was to be consulted, whereas the one it had proposed required implementation of the procedure for cooperation. ( 11 ) Thus the Court did not even address the issue of whether prima facie the legal basis adopted by the Council might be the wrong one, but relied exclusively on the formal wording of the Parliament's plea for annulment. ( 12 )

17. 

The arguments presented by the Council to the effect that the Court should not proceed in the same manner in the present case are not convincing. It refers to what may be termed the ‘distortion’ of the system of legal remedies. According to the Council, it is sufficient for the Parliament to claim that there is a difference between the Commission's initial proposal and the regulation adopted for it to be recognized as having a right to bring actions for annulment which is general, that is to say of such a nature as to be available against all measures of the Council.

18. 

Three observations may be made on that.

19. 

In the first place, the situation is the same as regards the choice of the legal basis for Council regulations. The Parliament could well systematically contest the choice, as a legal basis, of Treaty articles providing merely for its consultation. The Council fears that if this action is declared admissible the Parliament may consider itself entitled to demand a second consultation in every case. But the very conditions for admissibility of actions for annulment brought by the Parliament, as laid down in the ‘Chernobyl’ judgment, already allow the Parliament to contest all measures adopted by the Council in respect of which it was not associated under the cooperation procedure.

20. 

In the second place, the possibility of proceedings being brought systematically — which cannot be entirely excluded in the event of a serious institutional crisis in the Communities — is an element common to all methods of legal recourse. Proceedings might equally well be brought systematically, in some circumstances, by the Commission against Council measures. The exceptional nature of such a situation, in my view, prevents it from being taken into account for the purposes of determining a common set of legal principles governing the admissibility of proceedings.

21. 

In addition, it is doubtful whether the Council's argument provides a sufficient answer to such preoccupations. In the case of systematic proceedings, the Court, if that argument is followed, would in any case be bound to consider even at the admissibility stage the extent to which the Parliament's pleas might be well-founded.

22. 

Lastly, in my view, the ratio decidendi of the ‘Chernobyl’ judgment does not prevent the Parliament from contesting all the Council's measures if it considers that each of them breaches its prerogatives. The essential difference between actions for annulment brought by the Parliament and proceedings under the first paragraph of Article 173 of the EEC Treaty does not lie in the nature or number of the measures which can be contested but in the utility of the result that the proceedings seek to achieve — safeguard of the Parliament's prerogatives — and in the specific nature of the pleas in law which can be relied upon: breach of those prerogatives.

23. 

It is that twofold restriction which prevents the Parliament's right to bring actions for annulment from being termed ‘general’, as is the right conferred on the Council and the Commission, as well as the Member States, by the abovementioned provision.

24. 

Applying the restrictions contained in the ‘Chernobyl’ judgment as regards the admissibility of the action for annulment brought by the Parliament, it is only necessary to consider whether the purpose of the present proceedings is indeed to safeguard the Parliament's prerogatives and whether, by claiming that a second consultation was necessary on the ground that the Commission's proposal had been substantially amended, the Parliament is in fact putting forward a plea which is based on breach of its prerogatives. That is the final argument for inadmissibility put forward by the Council. As I have said, it maintains that the Parliament's opinion has no legal effects as regards the Council. Once consultation has taken place, there can be no breach of the Parliament's prerogatives, and it can, furthermore, be informed of the progress of the negotiations leading to the adoption of the regulation at issue by informal means.

25. 

The argument relating to the lack of legal consequences as regards the Council of consulting the Parliament must be rejected. The fact that the Council is not legally bound by the Parliament's opinion does not mean that the absence of further consultation if the initial proposal is substantially amended does not in any way affect the prerogatives of that institution regarding participation in the Community's legislative process. Politics is not law. It is easy to imagine that in certain sensitive areas, a negative opinion of the Parliament, although not legally binding on the Council, has a not inconsiderable effect on the process of adoption, or even on the substance, of the measure in question. The opportunity to express its opinion and, where appropriate, to express a second opinion, is a vital prerogative of the Parliament. Moreover, the case-law shows that the Court has already so decided.

26. 

In the well-known ‘isoglucose’ judgments, the Court held that

‘the consultation (...) is the means which allows the Parliament to play an actual part in the legislative process of the Community. Such power represents an essential factor in the institutional balance intended by the Treaty. Although limited, it reflects at Community level the fundamental democratic principle that the peoples should take part in the exercise of power through the intermediary of a representative assembly. Due consultation of the Parliament in the cases provided for by the Treaty therefore constitutes an essential formality disregard of which means that the measure concerned is void.’ ( 13 )

27. 

The Court has already indicated, however, that a second consultation of the Parliament is not required if ‘considered as a whole the substance of the draft regulation on which the Parliament was consulted has not been altered’, ( 14 ) or if ‘the amendment to the initial proposal constituted in reality a change of method rather than of substance’, ( 15 ) or, lastly, if the new provision ‘corresponded broadly to the wish expressed by the Parliament’. ( 16 )

28. 

Advocate General Mancini, in his Opinion in Roviello, ( 17 ) summarized the case-law as follows:

‘A proposal in which provisions are amended or in which a new provision is inserted will escape the need to be submitted once again to the Parliament only if the amendment or addition fulfils one of the following conditions: (a) it leaves unaltered the essential aspects of the broadest provision on which it has an effect (Chemiefarma, cited above, paragraph 69); (b) it is of a merely technical nature, that is to say, it involves changes of method and not of substance (Buyl, paragraph 23 and Chemiefarma, paragraph 178, cited above); and (c) it corresponds to the wishes of the Parliament (Buyl, ibidem)’. ( 18 )

29. 

The plea in law based on the lack of further consultation of the Parliament on a Commission proposal which had been substantially amended therefore refers to a breach of the Parliament's prerogatives. If the contested measure is annulled by the Court, the Council will be obliged to consult the Parliament on the text of the regulation in question before proceeding, if necessary, to adopt it again. The purpose of the action brought by the Parliament is, accordingly, to safeguard its prerogatives. ( 19 )

30. 

Consequently the action should be declared admissible.

31. 

As to the substance of the case, in support of its single plea in law concerning the lack of consultation on the proposal which it considers to have been substantially amended by the Commission, the Parliament refers to five aspects on which the proposal departs significantly from the initial proposal presented by the Commission in 1985.

32. 

The five aspects concern the abandonment of general cabotage for a system of Community quotas, the absence of [provision for] ‘consecutive’ cabotage in the contested regulation, the existence in the regulation of a safeguard clause, the addition of a system of penalties for infringements, and finally the temporary nature of the contested regulation.

33. 

In my view, the fifth point of divergence between the Commission's initial proposal and the final regulation adopted by the Council is covered by the first one in so far as, in order to assess the difference between the liberalization of national transports laid down by the Council and that initially suggested by the Commission, it is necessary to have regard to the temporary nature of the contested regulation. It also ties up with the fourth point to the extent that the system of penalties adopted by the Council is itself also temporary. On the other hand, the second and third aspects, which to some extent constitute the negative side of the contested regulation as compared with the initial proposal, since they are concerned with the removal or suspension of the liberalization measures, must be examined without regard to the fact that the contested regulation is temporary.

34. 

The first difference concerns ‘general’ cabotage. The initial proposal provided, in

Article 1, for any road haulier for hire or reward established in a Member State and authorized to carry out international road haulage operations to be allowed to carry out national road haulage operations in a Member State other than the one in which he was established. Under Article 3 the transport operation was to be governed by the laws, regulations and administrative provisions in force in the Member State in which the transport operation was carried out; such rules were to be applied to nonresident carriers under the conditions imposed by that State on its own nationals.

35. 

The regulation adopted by the Council on 21 December 1989 provides that road haulage carriers established in a Member State and authorized to operate international road haulage services are to be entitled to operate ‘on a temporary basis’ ( 20 ) national road haulage services in another Member State within a Community cabotage quota. ( 21 ) The quota consists of 15000 cabotage authorizations, each valid for two months, divided between the Member States. It is to increase annually as from 1 July 1991, with the increase being not less than 10%. ( 22 ) According to Article 9 the regulation enters into force on 1 July 1990 and applies until 31 December 1992; before 1 July 1992 the Council is to adopt a regulation laying down the definitive cabotage system. The quota can therefore be increased only twice, on 1 July 1991 and 1 July 1992.

36. 

The Council considers that the difference between the two systems is more a matter of method than of substance. As the Commission's initial proposal applied the general rule of ‘national treatment’, it is necessary, according to the Council, to take account of the existence in many Member States of quantitative restrictions on road haulage operations. Article 5(1) of the contested regulation precludes the application of national rules imposing a quota, however. The existence of a Community quota is in general no more restrictive than an apparent liberalization of the conditions of access to national haulage operations if the national restrictions continue to apply. It is more in conformity with the requirements of a common transport policy.

37. 

The Court's case-law gives few indications as to the extent of the amendments which, ‘considered as a whole’, ( 23 ) do not affect the substance of the initial proposal. The A CF Chemiefarma judgment answers in brief the objection of illegality brought against Article 15 of Regulation No 17. ( 24 ) In Battaglia, Buy I and Adam, ( 25 ) the difference between the proposal submitted to the Parliament and the final regulation adopted lay in the substitution of up-to-date exchange rates for the EUA (European Unit of Account); the Court considered that that was a change of method rather than of substance and that the rates adopted exactly reflected the value of the EUA in terms of national currencies on 1 April 1978. ( 26 )

38. 

The Parliament is aware that the liberalization intended by the Commission's initial proposal was deprived of some effect by national quantitative restrictions. In its opinion of 12 September 1986 the Parliament proposed adding to Article 1 a second paragraph worded as follows: ‘After paragraph 1 enters into force, Member States in which access to the national road haulage market is subject to quantitative restrictions shall increase the number of authorizations by an appropriate amount, so that when additional authorizations are issued hauliers from other Member States of the Community are also allowed to perform national road haulage operations’.

39. 

In my view the Commission's initial proposal had the effect of providing for unlimited access to national haulage operations in the Member States which did not have quantitative restrictions. For the other Member States, after the entry into force of the regulation which would have been adopted in accordance with the initial proposal, the national quotas would have had to be divided in a nondiscriminatory manner between nonresident and national transporters. From that, even if the initial proposal does not say how the national quotas could have been divided in a nondiscriminatory manner, it may be surmised that Member States applying quantitative restrictions would have been obliged to increase their national quota, without which the numerous national transporters would no longer have been in a position to obtain certain authorizations — those having been assigned to nonresident transporters — and would have had to reduce or cease their activities. It may be thought that a State which had not allocated any part of its quota or an extremely small share to nonresident transporters would inevitably be subject to proceedings for failing to comply with its obligations under the Treaty, there being a strong probability of discrimination.

40. 

Without dwelling on the question of whether or not maintaining national quotas is actually more restrictive than the Community quota laid down by the contested regulation (since in any case the Court does not have the necessary information to undertake such an analysis ( 27 )), I consider that the difference between the initial proposal and the final regulation is a difference of substance in so far as, firstly, the authorizations delivered under the Community quota are temporary and last two months and, secondly, the general system instituted by the Council is also temporary since the contested regulation remains in force only until 31 December 1992. In my view there is a material difference between a definitive liberalization of transport services, even subject in certain States to restrictions (capable however, as I have observed, of undergoing change), and temporary liberalization, which is precarious because it may be jeopardized by inertia on the part of the Council. Moreover, the Commission's initial proposal permitted unlimited access to the markets in Member States which did not apply quantitative restrictions.

41. 

Even if the system of a Community quota is more consistent with uniformity in Community law, in my opinion that difference cannot be characterized as simply a change of method. The choice between a regime having effects which differ according to the applicable national rules but which leads in some States to complete liberalization of road haulage operations and a more uniform but less liberal set of arrangements is sufficiently important to make it necessary to refer to the Parliament for its opinion on the matter.

42. 

The Parliament refers to a second difference concerning ‘consecutive’ cabotage. Article 5(1) of the Commission's initial proposal provided for a carrier to have the right to carry out two national transport operations in a Member State other than the one in which he was established, which ‘must follow on from a haulage operation between two Member States carried out under ... an authorization or without an authorization in the case of liberalized services’, and which ‘must be carried out during the return journey either to the Member State in which the operator is based or to the Member State where the preceding international transport operation began’. As the fifth recital to the proposal stated, the purpose of that provision was ‘[to reduce] the number of unladen journeys in international traffic ... so as to ensure the more efficient use of vehicles and energy and thus improve the productivity of international road haulage’, bearing in mind that ‘a reduction in the number of vehicles on the road’ would ‘improve the general environment’.

43. 

According to the Parliament, Article 5(1) of the initial proposal contained an important development, inasmuch as Council Regulation (EEC) No 1841/88 of 21 June 1988 on the Community quota for the carriage of goods by road between Member States ( 28 ) provided for the abolition of Community and bilateral quotas for the carriage of goods by road as from 1 January 1993.

44. 

On that point the Council replies that that regulation, having been adopted subsequent to the initial proposal, cannot be taken into account in deciding whether or not a second consultation of the Parliament was necessary.

45. 

The Parliament argues that when the Commission submitted its initial proposal on 5 December 1985, it was already aware of the conclusions adopted at Session No 1040 of the Transport Council on 14 November 1985, and of the fact that before the Parliament had formulated its opinion on the proposal on 12 September 1986, the Council, in Session No 1090 of 30 June 1985, had adopted conclusions to the effect that ‘the annual increase of the Community quota from 1987 should be 40%, the increases being cumulative until the implementation in 1993 of a free market without quantitative restrictions for intra-Community carriage of goods by road.’

46. 

It is common ground that the contested regulation makes no provision for ‘consecutive’ cabotage.

47. 

In order to determine whether or not there is a substantial difference between the initial proposal and the regulation finally adopted, it is natural I think to take into account not just the provisions which have undergone changes in method or substance, but also those which have disappeared from the final text. In order to assess the impact of the absence, in the proposal submitted by the Commission at the Council's session in December 1989, of any provision concerning ‘consecutive’ cabotage, it is necessary to place oneself at the time that the second proposal was presented in order to determine whether, taking into account the legal situation on the day, making the amendment by means of deletion from the text had effects of such a nature that a fresh consultation of the Parliament was required. In December 1989 neither the Council nor the Commission could have been unaware that the lack of provisions concerning ‘consecutive’ cabotage, contrary to what had been set out in the initial proposal, would have to be assessed in the light of the state of Community law as regards intra-Community transport at the time. If, on the contrary, we suppose that in December 1989 the provisions of Community law applying to those transport operations were very restrictive, deleting the provisions concerning ‘consecutive’ cabotage in the regulation finally adopted would at the time have been regarded as equivalent to what was set out in the initial proposal.

48. 

The Parliament is therefore quite right to refer to Regulation No 1841/88. Article 1 of that regulation adds a new provision, Article 4a, to Regulation (EEC) No 3164/76, ( 29 ) to the effect that ‘Community quotas, bilateral quotas between Member States and quotas for transit traffic to and from nonmember countries shall be abolished on 1 January 1993 for Community hauliers’. A new Article 3 is inserted, paragraph 2 of which states that ‘for 1989 the total number of Community authorizations allocated to the Member States as a whole in the context of the Community quota shall be 24021’; Article 3(3) states that ‘the Council shall decide by 31 March 1990 on a proposal from the Commission, which is to be submitted before 31 December 1989, on an increase in the Community quota from 1990 and on the measures to be taken in the event of a crisis. A report on the effects of previous increases including the allocation of the Community quota is to be attached to the proposal’.

49. 

Consequently, in view of the forthcoming complete liberalization of intra-Community transport operations the introduction of ‘consecutive’ cabotage could have made a significant contribution towards increasing the number of transport operations capable of being carried out by carriers established in other Member States. Its omission from the contested regulation substantially modifies the Commission's initial proposal in such a way as to require fresh consultation of the Parliament.

50. 

Thirdly, the Parliament refers to the existence in the contested regulation of safeguard measures which had no equivalent in the initial proposal. Article 2(5) of the regulation contains the following provision: ‘In the event of serious disturbance of the internal transport market in a given geographical area due to cabotage, any Member State may refer the matter to the Commission with a view to the adoption of safeguard measures. After consulting the other Member States, the Commission shall decide on the necessary safeguard measures within one month of receipt of the relevant Member State's request. Such measures may involve the temporary exclusion of the area concerned from the scope of this regulation. The Commission shall communicate to the Council and the Member States any decision it takes on safeguard measures’.

51. 

The Council replies that the addition was made in response to a wish expressed by the Parliament in its opinion of 12 September 1986.

52. 

At the time the Parliament had suggested adding to the Commission's initial proposal an Article 7a, worded as follows: ‘In the event of an unusual imbalance between supply and demand for road haulage, the Council may, at the request of a Member State and after consulting the Commission, authorize derogations for limited periods from the timetable laid down in this regulation’. It seems that this reference related to Article 1(1) of the proposal which provided for the regulation to take effect from 1 January 1987.

53. 

Some of the differences between the two texts are, in my view, mainly questions of drafting. The ‘unusual imbalance between supply and demand for road haulage’ referred to in the Parliament's proposal is conceptually very close to the ‘serious disturbance of the internal transport market (...) due to cabotage’. It seems to me in both cases to be a case of demand for carriage being so much higher than supply that it leads to the collapse of prices for transport services and imperils the existence of numerous undertakings.

54. 

Furthermore, although the Parliament's proposal did not refer to the geographical area within which the derogation is to apply, in my view there is nothing to prevent it covering the whole of the territory of a Member State and the contested regulation seems to allow that also.

55. 

Lastly, in both cases the application of the system established is temporarily excluded.

56. 

In my view the only real difference concerns the institutions. Under the contested regulation the measures are adopted by the Commission after consulting the other Member States; they are then communicated to the Council and the Member States. On the other hand, the Parliament's proposal confers on the Council the power to allow derogations after consulting the Commission. I do not think it necessary to enter here into a discussion of whether safeguard measures were more likely to be adopted if they fell within the Council's competence or that of the Commission. It is sufficient to observe that whether powers are to be conferred on the Council or on the Commission — there come to mind the Court's judgments concerning management committees ( 30 ) and responsibility for implementing the budget ( 31 ) — is important as regards the institutional balance of the Communities. Even if it is reasonable to assume that the Parliament would not have considered it unjustified to confer such competence on the Commission, it should be observed that in its opinion it chose to attribute it to the Council and it was not requested to give an opinion on the proposed amendment in December 1989 when the contested regulation was adopted. Further consultation of the Parliament was consequently required on this point also.

57. 

The fourth matter referred to by the Parliament concerns penalties. It considers that the provisions of Article 6 of the contested regulation were not in the initial Commission proposal.

58. 

Article 6 is as follows:

59. 

The Council contends that that system of sanctions was largely contained in the Commission's proposal, since Article 3 provided for the carrier to be governed by the laws, regulations and administrative provisions in force in the Member State in which the transport operations were carried out. It adds that the establishment of such arrangements reflects the wishes of the Parliament.

60. 

It is true that the Parliament, in its opinion of 12 September 1986, proposed adding a paragraph (2) to Article 3 in the following terms: ‘If repeated and serious infringements of Community transport law, road safety rules or the regulations mentioned in paragraph 1 are committed with a carrier's vehicles, the Member State concerned may withdraw that carrier's authorization to conduct road haulage operations as mentioned in Article 1; the competent authorities of that State may record this withdrawal on the certificate mentioned in Article 2(4).’

61. 

The system adopted by the Council is doubtless more elaborate than that suggested by the Parliament. The penalties, of increasing severity, are to be imposed by the competent authorities of the Member State of establishment (Article 6(3)), without prejudice to any criminal proceedings in the host Member State (Article 6(2)). The provisions proposed by the Parliament are, as regards the authorities competent to penalize infringements, more ambiguous because they refer to ‘the Member State concerned’, so that it is not clear whether the reference is to the host Member State or to the Member State of establishment, or even to exclude the possibility that the expression actually refers to both States. On the latter view, -which seems to me a not unreasonable interpretation of Article 3(2) of the Parliament's proposal, the Parliament's suggested approach has features which are very similar to the text adopted by the Council. Be that as it may, even if one chooses to interpret the Parliament's proposal as conferring the power to impose penalties only on the host Member State, the principle of legitimate expectations, which must prevail between Member States of the Community, means that, in my view, there is here a change which is more one of method than substance. The temporary nature of the regulation adopted by the Council cannot alter the analysis, since the Parliament cannot object to the addition of the system of penalties and at the same time complain that the system can be temporarily suspended. Furthermore, the abovementioned amendment reflects in principle the wishes of the Parliament. Therefore no further consultation of the Parliament is required on the point.

62. 

The considerations which I have just set out on the substance of the action show that ‘considered as a whole’, ( 32 ) the draft regulation finally adopted by the Council differs significantly from the proposal on which the Parliament was consulted. The contested regulation is therefore liable to annulment.

63. 

Two observations may be made as regards the scope of annulment.

64. 

The first concerns its extent. In my view it must extend in this case to the whole of the contested regulation. Firstly, it contains only homogenous provisions relating entirely to freedom to provide services in respect of carriage of goods by road; secondly the Court has held that, in order to determine whether further consultation of the Parliament is required, each of the two texts in question, ‘considered as a whole’, should be examined. While it is possible for a regulation containing various provisions, of which only those referring to a particular area are substantially different from those appearing in the initial proposal, to be annulled for failure to consult the Parliament a second time only in part, it must be observed that that is not called for in the present case.

65. 

The second observation concerns the power given to the Court in the second paragraph of Article 174 of the EEC Treaty to state ‘which of the effects of the regulation which it has declared void shall be considered as definitive’. I strongly suggest that the Court should make use of that provision. In the absence of that provision annulment of the contested regulation would, according to the terms of the judgment in Pinaud Wieger, ( 33 ) directly bar the achievement of freedom to provide services in respect of carriage of goods by road until the Council had adopted, after consulting the Parliament, a new regulation on the matter. ( 34 )

66. 

Applying the second paragraph of Article 174 to the present case will, moreover, have effects for only a few months by virtue of the fact that Article 9 of the contested regulation provides for it to remain in force until 31 December 1992. On the basis of that article the Council must adopt before 1 July 1992 a regulation setting out the definitive arrangements in respect of cabotage, to come into force on 1 January 1993. The Commission's proposal on this matter was submitted on 22 November 1991. ( 35 )

67. 

I therefore propose that: