61979J1252

1 . ECSC - PRICES - MINIMUM PRICE SCHEME - ALIGNMENT ON PRICES BELOW MINIMUM PRICES - NOT PERMISSIBLE

( ECSC TREATY , ARTS . 60 , 61 )

2 . ECSC - PRICES - ALIGNMENT - INFRINGEMENT - CONCESSION BY AUTHORITIES - JUSTIFICATION - NONE

3 . MEASURES ADOPTED BY INSTITUTIONS - DUTY TO STATE REASONS ON WHICH BASED - SCOPE - DECISION IMPOSING FINE

1 . INTRA-COMMUNITY ALIGNMENT CANNOT IN ANY CASE ENABLE GOODS TO BE SOLD BELOW THE MINIMUM PRICES SINCE ALL PRICE-LISTS OF COMMUNITY UNDERTAKINGS MUST COMPLY WITH THE DECISION ESTABLISHING THOSE MINIMUM PRICES . IT FOLLOWS THAT ANY SALE BY ALIGNMENT BELOW THE MINIMUM PRICES CONSTITUTES NOT ONLY AN IMPROPER INTRA-COMMUNITY ALIGNMENT , WHICH IS AN INFRINGEMENT OF ARTICLE 60 OF THE ECSC TREATY , BUT ALSO AN INFRINGEMENT OF THE MINIMUM PRICES .

2 . A CONCESSION ON THE PART OF THE AUTHORITIES CANNOT MAKE AN INFRINGEMENT LEGITIMATE , STILL LESS JUSTIFY MAKING THAT INFRINGEMENT MORE SERIOUS . THUS THE FACT THAT THE COMMISSION MAY HAVE SHOWN SOME LAXITY AS REGARDS ALIGNMENT NOT ON SPECIFIC PRICE-LISTS BUT ON A BASIC PRICE FORMED BY THE MINIMUM PRICE IN NO WAY JUSTIFIES SELLING AT PRICES LOWER THAN THE MINIMUM PRICES OR THE FAILURE TO TAKE INTO CONSIDERATION EXTRAS FOR QUALITY OR QUANTITY .

3 . THE STATEMENTS OF THE REASONS ON WHICH A DECISION IMPOSING A FINE FOR INFRINGEMENT OF THE ECSC RULES ON MINIMUM PRICES IS BASED , ALTHOUGH SUCCINCT , MUST BE CONSIDERED TO BE SUFFICIENT WHERE THE UNDERTAKING TO WHICH IT IS ADDRESSED HAS PARTICIPATED IN THE PROCEDURE WHEREBY THE DECISION IN QUESTION WAS DRAWN UP AND HAS BEEN INFORMED OF THE METHOD OF CALCULATING THE DISPUTED UNDER-PRICING .

IN CASE 1252/79

SPA ACCIAIERIE E FERRIERE LUCCHINI , HAVING ITS REGISTERED OFFICE AT BRESCIA ( ITALY ), REPRESENTED AND ASSISTED BY GIUSEPPE MARCHESINI , ADVOCATE AT THE ITALIAN CORTE SUPREMA DI CASSAZIONE , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE CHAMBERS OF ERNEST ARENDT , 34 B RUE PHILIPPE II ,

APPLICANT ,

V

COMMISSION OF THE EUROPEAN COMMUNITIES , REPRESENTED BY MR PROZZILLO , ACTING AS AGENT , WITH AN ADDRESS FOR SERVICE IN LUXEMBOURG AT THE OFFICE OF MARIO CERVINO , JEAN MONNET BUILDING , KIRCHBERG ,

DEFENDANT ,

APPLICATION PRINCIPALLY FOR THE ANNULMENT OF THE DECISION OF THE COMMISSION OF THE EUROPEAN COMMUNITIES OF 31 OCTOBER 1979 , NOTIFIED ON 16 NOVEMBER 1979 , IMPOSING ON THE APPLICANT A FINE FOR INFRINGEMENT OF THE COMMUNITY RULES ON COMPULSORY MINIMUM PRICES FOR CERTAIN IRON AND STEEL PRODUCTS AND , IN THE ALTERNATIVE , FOR THE REDUCTION OF THAT FINE ,

1 BY APPLICATION LODGED AT THE COURT REGISTRY ON 21 DECEMBER 1979 , THE ITALIAN COMPANY ACCIAIERIE E FERRIERE LUCCHINI SPA BROUGHT , UNDER ARTICLE 36 OF THE ECSC TREATY , PROCEEDINGS FOR THE ANNULMENT AND , IF NECESSARY , THE AMENDMENT OF THE INDIVIDUAL DECISION OF 31 OCTOBER 1979 BY WHICH THE COMMISSION IMPOSED ON IT A FINE OF 25 000 EUROPEAN UNITS OF ACCOUNT , IN OTHER WORDS LIT 28 770 000 , FOR INFRINGEMENTS OF GENERAL DECISION NO 3000/77/ECSC OF 28 DECEMBER 1977 FIXING MINIMUM PRICES FOR HOT-ROLLED WIDE STRIPS , MERCHANT BARS AND CONCRETE REINFORCING BARS ( OFFICIAL JOURNAL L 352 , P . 1 ). THE CONTESTED DECISION WAS TAKEN AFTER AN INVESTIGATION HAD BEEN CARRIED OUT AT THE LUCCHINI UNDERTAKING ; THE COMMISSION COMPLAINED THAT , AS REGARDS SALES OF MERCHANT BARS IN FRANCE , IT SOLD BELOW THE MINIMUM PRICES FIXED BY DECISION NO 3000/77/ECSC , AND AS REGARDS SALES OF THE SAME PRODUCT IN THE FEDERAL REPUBLIC OF GERMANY , THAT , BY NOT CHARGING CERTAIN EXTRAS FOR QUALITY AND QUANTITY LAID DOWN IN THE GERMAN PRICE-LISTS , IT CHARGED EFFECTIVE SELLING PRICES BELOW THE ALIGNMENT PRICES WHICH SHOULD HAVE BEEN EQUAL TO OR HIGHER THAN THE MINIMUM PRICES .

2 THE APPLICANT FIRST OF ALL REQUESTED THE ANNULMENT OF THE INDIVIDUAL DECISION ON THE GROUND THAT THE BASIC DECISION , DECISION NO 3000/77/ECSC , WAS ILLEGAL . IN ITS REPLY , IT SUBSEQUENTLY TOOK NOTE OF THE JUDGMENT DELIVERED ON 18 MARCH 1970 IN JOINED CASES 154/78 , 205 AND 206/78 , 226 TO 228/78 , 263 AND 264/78 , 31 , 39 , 83 AND 85/79 , SPA FERRIERE VALSABBIA AND OTHERS , IN WHICH THE COURT DISMISSED THE SUBMISSION BASED BY THE APPLICANTS ON THE ILLEGALITY OF GENERAL DECISION NO 962/77/ECSC OF 4 MAY 1977 ( OFFICIAL JOURNAL L 114 , P . 1 ); DECISION NO 3000/77/ECSC MERELY PROLONGS THAT DECISION AS REGARDS CONCRETE REINFORCING BARS AND EXTENDS IT TO HOT-ROLLED WIDE STRIPS AND MERCHANT BARS . CONSEQUENTLY , THE APPLICANT LIMITED ITS APPLICATION TO THE ANNULMENT OF THE INDIVIDUAL DECISION IMPOSING A FINE OF 31 OCTOBER 1979 ON THE GROUND OF ILLEGALITY ' ' CONSISTING IN DEFECTS PERTAINING TO THAT DECISION ' ' ; IN THE ALTERNATIVE IT REQUESTED THE AMENDMENT OF THAT DECISION BY REDUCING THE FINE TO A ' ' PURELY NOMINAL ' ' LEVEL .

3 IT IS NECESSARY TO TAKE NOTE OF THAT AMENDMENT OF THE APPLICANT ' S CLAIMS AND TO EXAMINE THE FOUR SUBMISSIONS WHICH IT PUTS FORWARD FOR THE PURPOSE OF CONTESTING THE LEGALITY OF THE INDIVIDUAL DECISION OF 31 OCTOBER 1979 .

4 FIRST OF ALL , THE APPLICANT MAINTAINS THAT IT COMPLIED WITH DECISION NO 3000/77/ECSC BY EXERCISING THE FACULTY OF ALIGNMENT GRANTED BY ARTICLE 60 ( 2 ) ( B ) OF THE TREATY AND EXPRESSED WITHIN THE FRAMEWORK OF THAT DECISION BY ARTICLE 6 WHICH PROVIDES AS FOLLOWS :

' ' THE MINIMUM PRICES SHALL NOT PRECLUDE ALIGNMENTS ON MORE FAVOURABLE DELIVERED PRICES BASED ON THE PRICE-LISTS OF OTHER PRODUCERS IN THE COMMUNITY OR IN THE COUNTRIES REFERRED TO IN ARTICLE 5 . ' '

IN THIS RESPECT IT EMPHASIZES THAT , IN CALCULATING THE ALIGNMENT , IT DID NOT TAKE INTO ACCOUNT EXTRAS FOR QUALITY ON THE GROUND THAT IT FOLLOWS FROM ARTICLE 2 ( 1 ) OF DECISION NO 3000/77/ECSC THAT MINIMUM PRICES ARE BASIC PRICES EX-BASING POINT ' ' INCLUDING EXTRA FOR QUALITY ' ' AND THAT THE MEANING OF THESE WORDS IS EMPHASIZED BY THE FACT THAT THE COMMUNITY LEGISLATURE DELETED THE EXPRESSION ' ' INCLUDING EXTRA FOR QUALITY ' ' IN THE SUBSEQUENT DECISION , DECISION NO 3139/78/ECSC OF 29 DECEMBER 1978 ( OFFICIAL JOURNAL L 370 , P . 79 ). THE COMMISSION , FOR ITS PART , MAINTAINS THAT ALIGNMENT CANNOT BE CARRIED OUT ON THE MINIMUM PRICE IN FORCE IN THE MEMBER STATE OF DESTINATION BUT ON THE PRICES CONTAINED IN THE PRICE-LISTS OF THE PRODUCERS IN THAT MEMBER STATE AND THAT THE GENERAL CONDITIONS OF SALE WHICH ARE APPLIED IN THAT STATE MUST BE COMPLIED WITH ; IN PARTICULAR , IT CLAIMS THAT IT WAS IMPOSSIBLE TO IGNORE THE PRICE DIFFERENCES CORRESPONDING TO EXTRAS FOR QUALITY AND QUANTITY .

5 IN THIS CONNEXION , IT IS APPROPRIATE TO RECALL THAT IT FOLLOWS FROM ARTICLE 4 ( 2 ) AND ( 3 ) OF GENERAL DECISION NO 3000/77/ECSC THAT SURCHARGES OR EXTRAS OF ANY SORT MUST IN FACT BE SHOWN IN PRICE-LISTS AND CONDITIONS OF SALE . ALIGNMENT ON THE PRICE-LISTS OF PRODUCERS OF THE MEMBER STATE OF DESTINATION CAN THEREFORE ONLY BE CARRIED OUT ON THE EFFECTIVE PRICES LISTED THEREIN FOR SIMILAR PRODUCTS CORRESPONDING TO PRECISE SPECIFICATIONS , INCLUDING ALL EXTRAS . OTHERWISE THE OPTION OF ALIGNMENT ON THE ACTUAL PRICES OF COMPETITORS REFERRED TO IN ARTICLE 6 OF GENERAL DECISION NO 3000/77/ECSC WOULD BE MEANINGLESS .

6 WITH REGARD TO THE ARGUMENT FROM THE WORDING OF ARTICLE 2 ( 1 ) OF DECISION NO 3000/77/ECSC , IT IS NECESSARY TO EMPHASIZE THAT THAT PROVISION MUST BE UNDERSTOOD AS MEANING THAT THE MINIMUM LEGAL PRICE INCLUDED EXTRAS WHICH MAY HAVE BEEN LAID DOWN IN THE PRICE-LISTS PUBLISHED BEFORE MINIMUM PRICES WERE INTRODUCED BY DECISION NO 962/77 OF 4 MAY 1977 , BUT EXCLUSIVELY AS REGARDS THE QUALITIES FOR WHICH THE MINIMUM LEGAL PRICE WAS FIXED AND WHICH ARE LISTED EXHAUSTIVELY AND SPECIFICALLY IN ARTICLE 1 ( 2 ) OF THE DECISION ; THIS MEASURE DOES NOT THEREFORE CONCERN MERCHANT BARS AS A WHOLE BUT ONLY MERCHANT BARS IN ORDINARY MILD STEEL , THE ONLY QUALITY OF MERCHANT BARS SPECIFIED IN THE DECISION WHICH CANNOT INCLUDE ANY ADDITIONAL CHARGE WHATSOEVER . IT IS MOREOVER NECESSARY TO UNDERSTAND TO THIS EFFECT THE INTERPRETATION GIVEN BY THE COURT TO ARTICLE 2 ( 1 ) OF DECISION NO 3000/77/ECSC IN THE JUDGMENT OF 18 MARCH 1980 ( CASE 154/78 , VALSABBIA AND OTHERS , PARAGRAPH 176 OF THE DECISION ), WHICH ONLY REFERRED TO CONCRETE REINFORCING BARS .

7 INTRA-COMMUNITY ALIGNMENT CANNOT IN ANY CASE ENABLE GOODS TO BE SOLD BELOW THE MINIMUM PRICES SINCE ALL PRICE-LISTS OF COMMUNITY UNDERTAKINGS MUST COMPLY WITH THE DECISION ESTABLISHING THOSE MINIMUM PRICES . IT FOLLOWS THAT ANY SALE BY ALIGNMENT BELOW THE MINIMUM PRICES CONSTITUTES NOT ONLY AN IMPROPER INTRA-COMMUNITY ALIGNMENT , WHICH IS AN INFRINGEMENT OF ARTICLE 60 OF THE TREATY , BUT ALSO AN INFRINGEMENT OF THE MINIMUM PRICES . THE FIRST SUBMISSION IS THEREFORE UNFOUNDED .

8 SECONDLY , THE APPLICANT STATES THAT THERE HAS BEEN AN INFRINGEMENT OF GENERAL PRINCIPLES OF LAW , IN PARTICULAR OF THE PRINCIPLE OF LEGITIMATE EXPECTATION AND THAT OF THE PROHIBITION OR DISCRIMINATION . THE COMMISSION , IT CLAIMS , HAS FAILED TO FULFIL ITS LEGITIMATE EXPECTATION BY ADOPTING TEMPORARILY A PERMISSIVE ATTITUDE TOWARDS OTHER UNDERTAKINGS GUILTY OF THE SAME ACTIONS AND PUTTING ASIDE THIS CONDUCT WITH REGARD TO LUCCHINI . THE APPLICANT CLAIMS THAT THE COMMISSION ALSO DISCRIMINATED AGAINST IT IN RELATION TO THOSE UNDERTAKINGS , MORE PRECISELY , WITH REGARD TO THE ADDITIONAL CHARGE FOR SMALL QUANTITIES .

9 IT IS NECESSARY TO OBSERVE FIRST OF ALL THAT A CONCESSION ON THE PART OF THE AUTHORITIES CANNOT MAKE AN INFRINGEMENT LEGITIMATE , STILL LESS JUSTIFY MAKING THAT INFRINGEMENT MORE SERIOUS . THE FACT THAT THE COMMISSION MAY HAVE SHOWN SOME LAXITY AS REGARDS ALIGNMENT NOT ON SPECIFIC PRICE-LISTS BUT ON A BASIC PRICE FORMED BY THE MINIMUM PRICE IN NO WAY JUSTIFIES SELLING AT PRICES LOWER THAN THE MINIMUM PRICES OR THE FAILURE TO TAKE INTO CONSIDERATION EXTRAS FOR QUALITY OR QUANTITY . MOREOVER , IT HAS NOT BEEN SHOWN THAT PRODUCERS IN OTHER MEMBER STATES BENEFITED FROM A CONCESSION ENABLING THEM NOT TO CHARGE THE EXTRAS FOR QUALITY OR QUANTITY .

10 WITH REGARD TO THE ALLEGED DISCRIMINATION , WHICH THE APPLICANT CLAIMS FOLLOWS FROM THE CONCESSION TO CERTAIN UNDERTAKINGS IN RESPECT OF CONSIDERABLE UNDER-PRICING AS REGARDS EXTRAS FOR QUANTITY , IT IS NECESSARY TO STATE THAT SUCH DISCRIMINATION ONLY OCCURRED BEFORE THE COMING INTO FORCE OF THE RULES THE INFRINGEMENT OF WHICH FORMS THE BASIS OF THE CONTESTED DECISION . THE SECOND SUBMISSION IS THEREFORE UNFOUNDED .

11 THIRDLY , THE APPLICANT MAINTAINS THAT IT ACTED OUT OF NECESSITY SO AS NOT TO LOSE TRADITIONAL MARKETS OF VITAL IMPORTANCE TO IT .

12 WITHOUT ITS BEING NECESSARY TO EXAMINE WHETHER THIS THREAT COULD HAVE GIVEN RISE TO A STATE OF NECESSITY JUSTIFYING ITS CONDUCT , IT IS SUFFICIENT TO STATE THAT THE APPLICANT HAS NOT SHOWN THAT IT WAS IN DANGER OF BANKRUPTCY OR WINDING-UP , ESPECIALLY SINCE , AS THE APPLICANT ITSELF STATES , THE AMOUNT OF THE IMPROPER SALES RELATES ONLY TO A TINY PROPORTION OF ITS TURNOVER . THIS SUBMISSION MUST THEREFORE BE DISMISSED .

13 FOURTHLY , THE APPLICANT PLEADS THE INFRINGEMENT OF ESSENTIAL PROCEDURAL REQUIREMENTS ON THE GROUND THAT THE CONTESTED DECISION DID NOT STATE SUFFICIENTLY THE GROUNDS UPON WHICH IT WAS BASED . THE APPLICANT CLAIMS THAT IT WAS THEREFORE NOT POSSIBLE TO FIND OUT FROM THE CONTESTED DECISION EXHAUSTIVE DETAILS OF THE METHOD OF CALCULATING THE UNDER-PRICING , AND CONSEQUENTLY THAT OF CALCULATING THE FINE IMPOSED .

14 IT IS CLEAR FROM THE LETTERS OF 14 DECEMBER 1978 , 18 JANUARY 1979 AND 8 FEBRUARY 1979 SENT BY THE COMMISSION TO THE APPLICANT THAT THE COMMISSION PROVIDED EXPLANATIONS AS TO ITS METHODS OF CALCULATION IN THIS CONNEXION . THOSE EXPLANATIONS MUST HAVE APPEARED TO BE ADEQUATE SINCE IT FOLLOWS FROM THE MINUTES OF THE HEARING OF THE APPLICANT ' S REPRESENTATIVE ON 7 MAY 1979 THAT THE LATTER DID NOT ASK ANY QUESTIONS IN THIS CONNEXION . IT FOLLOWS FROM THESE FINDINGS THAT THE APPLICANT , WHICH PARTICIPATED IN THE PROCEDURE WHEREBY THE CONTESTED DECISION WAS DRAWN UP , KNEW THE METHODS OF CALCULATION USED BY THE COMMISSION AND THAT , IN THESE CIRCUMSTANCES , THE STATEMENT OF THE GROUNDS UPON WHICH THE DECISION WAS BASED ITSELF , ALTHOUGH SUCCINCT , MUST BE CONSIDERED TO BE SUFFICIENT . THIS COMPLAINT MUST THEREFORE BE REJECTED .

THE AMOUNT OF THE FINE

15 IN THE ALTERNATIVE , THE APPLICANT REQUESTS THE AMENDMENT OF THE CONTESTED DECISION AND THAT IT SHOULD BE ORDERED TO PAY A NOMINAL FINE . THE COMMISSION INSISTS THAT THE FINE SHOULD BE MAINTAINED AND REFERS TO THE PRECEDENT FORMED BY THE DECISION ADOPTED IN THE JUDGMENT OF 12 JULY 1979 ( CASE 149/78 , RUMI ( 1979 ) ECR 2523 ).

16 THE APPLICANT HAS NOT PUT FORWARD ANY ARGUMENTS WHICH MAY , EVEN PARTIALLY , JUSTIFY ITS CONDUCT ON THE BASIS OF CIRCUMSTANCES PARTICULAR TO IT , AND THE COMMISSION , BY TAKING INTO ACCOUNT THE AMOUNT OF THE IMPROPER SALES AND THE PRESENT FINANCIAL RESOURCES OF THE UNDERTAKING , TOOK THE FACTS OF THE CASE INTO CONSIDERATION FAIRLY . IT IS THEREFORE UNNECESSARY TO UPHOLD THE REQUEST FOR REDUCTION OF THE FINE .

17 UNDER ARTICLE 69 ( 2 ) OF THE RULES OF PROCEDURE , THE UNSUCCESSFUL PARTY SHALL BE ORDERED TO PAY THE COSTS .

18 SINCE THE APPLICANT HAS FAILED IN ITS SUBMISSIONS , IT IS NECESSARY TO ORDER IT TO PAY THE COSTS .

ON THOSE GROUNDS ,

THE COURT ( SECOND CHAMBER )

HEREBY :

1 . DISMISSES THE APPLICATION ;

2 . ORDERS THE APPLICANT TO PAY THE COSTS .