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J/98/26

Proceedings of the court of justice and the Court of first instance of the european Communities 26 to 30 October 1998

I. JUDGMENTS

Court of Justice

Margaret Boyle and Others v Equal Opportunities Commission

Social policy

Commission of the European Communities v Ireland

Social policy

Réunion Européenne SA and Others v Spliethoff's Bevrachtingskantoor BV and Capitaine Commandant le Navire 'Alblasgracht V002'

Judgments Convention/Enforcement of judgments

Manifattura Italiana Nonwoven SpA v Direzione Regionale delle Entrate per la Toscana

Taxation

Fuerzas Eléctricas de Catalunya SA (FECSA) and Autopistas Concesionaria Española SA v Departament d'Economía and Finances de la Generalitat de Catalunya

Taxation

Abbruzzi Gas SpA (Agas) v Amministrazione Tributaria di Milano

Taxation

Ibiyinka Awoyemi

Freedom of movement for persons

Commission of the European Communities v Grand Duchy of Luxembourg

Social policy

Commission of the European Communities v Hellenic Republic

Freedom of movement for persons

Galileo Zaninotto v Ispettorato Centrale Repressione Frodi - Ufficio di Conegliano - Ministero delle Risorse Agricole, Alimentari and Forestali

Agriculture

Commission of the European Communities v Kingdom of Spain

Freedom of movement for persons

Manuel de Castro Freitas, Raymond Escallier v Ministre des Classes Moyennes et du Tourisme

Freedom of movement for persons

Court of First Instance

TEAM Srl v Commission of the European Communities

External relations

II. OPINIONS

Lloyd Schuhfabrik Meyer & Co. GmbH v Klijsen Handel B.V.

Compagnie Maritime Belge SA and Dafra-Lines A/S v Commission of the European Communities

Massimo Romanelli and Paolo Romanelli

III. NEW CASES

1.

JUDGMENTS

Court of Justice

Case C-411/96

Margaret Boyle and Others v Equal Opportunities Commission

Social policy

27 October 1998

Preliminary ruling

(Equal pay and equal treatment for men and women · Maternity leave · Rights of pregnant women in respect of sick leave, annual leave and the accrual of pension rights)

(Full Court)

By order of 15 October 1996, received at the Court on 23 December 1996, the Industrial Tribunal, Manchester, referred to the Court for a preliminary ruling five questions on the interpretation of Article 119 of the EC Treaty, Council Directive 75/117/EEC of 10 February 1975 on the approximation of the laws of the Member States relating to the application of the principle of equal pay for men and women (hereinafter 'the equal pay directive'), Council Directive 76/207/EEC of 9 February 1976 on the implementation of the principle of equal treatment for men and women as regards access to employment, vocational training and promotion, and working conditions (hereinafter 'the equal treatment directive') and Council Directive 92/85/EEC of 19 October 1992 on the introduction of measures to encourage improvements in the safety and health at work of pregnant workers and workers who have recently given birth or are breastfeeding (hereinafter 'Directive 92/85').

Those questions were raised in proceedings between Mrs Boyle and Others and their employer, the Equal Opportunities Commission (hereinafter 'the EOC'), concerning the Maternity Scheme applied by the latter to its staff.

The national legislation

The six applicants in the main proceedings are all employees of the EOC of childbearing age. They have completed at least one year's service with their employer, at least three of them have taken maternity leave in the recent past.

According to the contract, staff who are unfit to work because of illness are entitled to their full salary for a maximum of six months in any 12 month period. Thereafter, they receive half pay up to a maximum of 12 months in any four-year period. Another clause provides that any leave taken without pay reduces the annual leave entitlement by a proportion of the amount of unpaid leave taken.

The dispute in the main proceedings centres on the Maternity Scheme. The persons concerned applied to the Industrial Tribunal, Manchester, for a declaration that certain conditions of the scheme are void or unenforceable in so far as they discriminate against female employees and are thus contrary to Community legislation.

According to one of those clauses, any member of staff who has rendered at least one year's paid service with the EOC is entitled to three months and one week's maternity leave on full pay for the period of continuous absence before and after childbirth. However, in order to benefit from that right, the employee must state that she intends to return to work in the EOC after childbirth and agree to be liable to repay any payment made during that period (excluding SMP to which she is entitled in any event), should she fail to return.

According to another contested clause of the Maternity Scheme, a member of staff who is entitled to paid maternity leave may also qualify for supplementary unpaid maternity leave provided.

Finally, the Maternity Scheme states that members of staff who are not entitled to paid leave of absence retain their contractual rights and benefits, except remuneration, during the first 14 weeks of leave.

The national court points out that employees on any form of paid leave, apart from paid maternity leave, including sick leave and paid special leave, are not required to agree to repay any part of their salary if they do not return to work after the period of leave. Furthermore, it is agreed that substantially more women employees than men employees take periods of unpaid leave in the course of their careers, largely because they take supplementary maternity leave.

The first question

By its first question, the national court essentially asks whether the Community legislation precludes a clause in an employment contract which makes the payment, during the period of maternity leave of pay higher than the statutory payments in respect of maternity leave conditional on the woman's undertaking to return to work after the birth of the child.

In that respect, it should be noted that it was in view of the risk that the provisions relating to maternity leave would be ineffective if rights connected with the employment contract were not maintained, that the Community legislature provided that 'maintenance of a payment to, and/or entitlement to an adequate allowance' for workers to whom the directive applies must be ensured in the case of the maternity leave.

The concept of allowance to which that provision refers Directive 92/85 includes all income received by the worker during her maternity leave which is not paid to her by her employer pursuant to the employment relationship.

In this respect, the provisions of the directive are intended to ensure that, during her maternity leave, the worker receives an income at least equivalent to the sickness allowance provided for by national social security legislation in the event of a break in her activities on health grounds.

Female workers must be guaranteed an income of that level during their maternity leave, irrespective of whether it is paid in the form of an allowance, pay or a combination of the two.

However, the Directive is not intended to guarantee her any higher income which the employer may have undertaken to pay her, under the employment contract, should she be on sick leave.

It follows that a clause in an employment contract according to which a worker who does not return to work after childbirth is required to repay the difference between the pay received by her during her maternity leave and the statutory payments to which she was entitled in respect of maternity leave is compatible with Directive 92/85 in so far as the level of those payments is not lower than the income which the worker concerned would receive, under the relevant national social security legislation, in the event of a break in her activities on grounds connected with her state of health.

A clause in an employment contract which makes the application of a more favourable set of rules than that prescribed by national legislation conditional on the pregnant woman, unlike any worker on sick leave, returning to work after childbirth, failing which she must repay the contractual maternity pay in so far as it exceeds the level of the statutory payments in respect of that leave, therefore does not constitute discrimination on grounds of sex.

The second question

By its second question, the national court essentially asks whether Community law precludes a clause in an employment contract from requiring an employee who has expressed her intention to commence her maternity leave during the six weeks preceding the expected week of childbirth, and is on sick leave with a pregnancy-related illness immediately before that date and gives birth during the period of sick leave, to bring forward the date on which her paid maternity leave commences either to the beginning of the sixth week preceding the expected week of childbirth or to the beginning of the period of sick leave, whichever is the later.

The contested clause applies to the case of a pregnant employee who has expressed her wish to commence her maternity leave during the six weeks preceding the expected week of childbirth.

In that respect, Article 8 of Directive 92/85 leaves it open to the Member States to determine the date on which maternity leave is to commence.

National legislation may therefore, as here, provide that the period of maternity leave commences with the date notified by the person concerned to her employer as the date on which she intends to commence her period of absence, or the first day after the beginning of the sixth week preceding the expected week of childbirth during which the employee is wholly or partly absent because of pregnancy, should that day fall on an earlier date.

The clause to which the second question relates merely reflects the choice made in such national legislation.

The third question

By its third question, the national court asks whether Community legislation precludes a clause in an employment contract from prohibiting a woman from taking sick leave during the minimum period of 14 weeks' maternity leave to which a female worker is entitled pursuant to Article 8 of Directive 92/85 or any supplementary period of maternity leave granted to her by the employer, unless she elects to return to work and thus terminate her maternity leave.

In that respect, although the Member States are required to take the necessary measures to ensure that workers are entitled to a period of maternity leave of at least 14 weeks, those workers may waive that right, with the exception of the two weeks compulsory maternity leave which, in the United Kingdom, commence on the day on which the child is born.

In contrast, if a woman becomes ill during the period of maternity leave referred to by Directive 92/85 and places herself under the sick leave arrangements, and that sick leave ends before the expiry of the period of maternity leave, she cannot be deprived of the right to continued enjoyment, after that date, of the maternity leave provided for by the aforementioned provision until the expiry of the minimum period of 14 weeks, that period being calculated from the date on which the maternity leave commenced.

The third question need be examined only in so far as the clause of the employment contract referred to therein applies to the supplementary period of maternity leave granted by the employer to female workers.

In that respect, the principle of non-discrimination laid down by the equal treatment directive does not require a woman to be able to exercise simultaneously both the right to supplementary maternity leave granted to her by the employer and the right to sick leave.

Consequently, in order for a woman on maternity leave to qualify for sick leave, she may be required to terminate the period of supplementary maternity leave granted to her by the employer.

The fourth question

By its fourth question, the national court essentially seeks to ascertain whether Community law precludes a clause in an employment contract from limiting the period during which annual leave accrues to the minimum period of 14 weeks' maternity leave to which female workers are entitled under the directive.

It should be noted that substantially more women than men take periods of unpaid leave during their career because they take supplementary maternity leave, so that, in practice, the clause at issue applies to a greater percentage of women than men.

However, the fact that such a clause applies more frequently to women results from the exercise of the right to unpaid maternity leave granted to them by their employers in addition to the period of protection guaranteed by Directive 92/85.

The supplementary unpaid maternity leave constitutes a special advantage, over and above the protection provided for by Directive 92/85 and is available only to women, so that the fact that annual leave ceases to accrue during that period of leave cannot amount to less favourable treatment of women.

The fifth question

By its fifth question, the national court essentially seeks to ascertain whether Community law precludes a clause in an employment contract from limiting, in the context of an occupational scheme wholly financed by the employer, the accrual of pension rights during maternity leave to the period during which the woman receives the pay provided for by that employment contract or national legislation.

The accrual of pension rights in the context of an occupational scheme wholly financed by the employer constitutes one of the rights connected with the employment contracts of the workers.

Such rights must, in accordance with Directive 92/85, be ensured during the period of maternity leave of at least 14 weeks to which female workers are entitled.

Although, in accordance with Directive 92/85, it is open to Member States to make entitlement to pay or the adequate allowance conditional upon the worker concerned fulfilling the conditions of eligibility for such benefits laid down under national legislation, no such possibility exists in respect of rights connected with the employment contract.

The accrual of pension rights under an occupational scheme during the period of maternity leave referred to by Directive 92/85 cannot therefore be made conditional upon the woman's receiving the pay provided for by her employment contract or SMP during that period.

The Court ruled:

  • '1. Article 119 of the EC Treaty, Article 1 of Council Directive 75/117/EEC of 10 February 1975 on the approximation of the laws of the Member States relating to the application of the principle of equal pay for men and women and Article 11 of Council Directive 92/85/EEC of 19 October 1992 on the introduction of measures to encourage improvements in the safety and health at work of pregnant workers and workers who have recently given birth or are breastfeeding (tenth individual Directive within the meaning of Article 16(1) of Council Directive 89/391/EEC) do not preclude a clause in an employment contract which makes the payment, during the period of maternity leave referred to by Article 8 of Directive 92/85, of pay higher than the statutory payments in respect of maternity leave conditional on the worker's undertaking to return to work after the birth of the child for at least one month, failing which she is required to repay the difference between the amount of the pay she will have received during the period of maternity leave, on the one hand, and the amount of those payments, on the other.
  • 2. Article 8 of Directive 92/85 and Article 5(1) of Council Directive 76/207/EEC of 9 February 1976 on the implementation of the principle of equal treatment for men and women as regards access to employment, vocational training and promotion, and working conditions do not preclude a clause in an employment contract from requiring an employee who has expressed her intention to commence her maternity leave during the six weeks preceding the expected week of childbirth, and is on sick leave with a pregnancy-related illness immediately before that date and gives birth during the period of sick leave, to bring forward the date on which her paid maternity leave commences either to the beginning of the sixth week preceding the expected week of childbirth or to the beginning of the period of sick leave, whichever is the later.
  • 3. A clause in an employment contract which prohibits a woman from taking sick leave during the minimum period of 14 weeks' maternity leave to which a female worker is entitled pursuant to Article 8(1) of Directive 92/85, unless she elects to return to work and thus terminate her maternity leave, is not compatible with Directive 92/85. By contrast, a clause in an employment contract which prohibits a woman from taking sick leave during a period of supplementary maternity leave granted to her by the employer, unless she elects to return to work and thus terminate her maternity leave, is compatible with Directives 76/207 and 92/85.
  • 4. Directives 92/85 and 76/207 do not preclude a clause in an employment contract from limiting the period during which annual leave accrues to the minimum period of 14 weeks' maternity leave to which female workers are entitled under Article 8 of Directive 92/85 and from providing that annual leave ceases to accrue during any period of supplementary maternity leave granted to them by their employer.
  • 5. Directive 92/85 precludes a clause in an employment contract from limiting, in the context of an occupational scheme wholly financed by the employer, the accrual of pension rights during the period of maternity leave referred to by Article 8 of that directive to the period during which the woman receives the pay provided for by that contract or national legislation.'

    Advocate General D. Ruiz-Jarabo Colomer delivered his Opinion at the sitting of the Full Court on 19 February 1998.

    He proposed that the Court give following answers:

  • 1. In circumstances such as those of the present case, neither Article 119 of the Treaty of Rome, nor Council Directive 75/117/EEC of 10 February 1975 on the approximation of the laws of the Member States relating to the application of the principle of equal pay for men and women, nor Council Directive 76/207/EEC on the implementation of the principle of equal treatment for men and women as regards access to employment, vocational training and promotion, and working conditions, nor Council Directive 92/85/EEC on the introduction of measures to encourage improvements in the safety and health at work of pregnant workers and workers who have recently given birth or are breast-feeding (tenth individual directive within the meaning of Article 16(1) of Directive 89/391/EEC) precludes the application of clauses of the kind examined in this Opinion under which:
    • (1) an employer, who is prepared, for the benefit of his employees, to go beyond the legal provisions applicable to pay during maternity leave, imposes, as a quid pro quo, by means of clauses like those of the EOC Maternity Scheme, the requirement that the employees declare, before commencing maternity leave, that they intend returning to work and give an undertaking to repay the difference between the full salary paid to them and the Statutory Maternity Pay that they would have received had they not given an undertaking to return to work, in the event of their failing to come back to work for at least one month;
    • (2) where a worker has indicated that she wishes to commence maternity leave on any date in the six weeks prior to the expected week of confinement and is declared unfit for work on account of pregnancy immediately before that date, then, if the birth occurs whilst she is in that situation, the commencement of her maternity leave may be backdated to the later of the following two dates: the beginning of the period of sick leave or the start of the sixth week prior to the expected week of confinement;
    • (3) a woman who has begun her maternity leave or is on unpaid maternity leave is not allowed to be accorded sick leave on full pay · being entitled in the latter case to claim only Statutory Sick Pay · and is required, in order to be granted such leave, to have stated, three weeks in advance, her intention to return to work on a specified day, thereby bringing to an end, if the birth has occurred, her special maternity leave arrangements, provided that the two weeks of compulsory maternity leave have already been taken;
    • (4) the time for which annual leave accrues is limited to the 14 weeks' duration of the maternity leave, and such accrual is excluded during unpaid maternity leave.
  • 2. Article 11(2)(a) of Directive 92/85, in conjunction with Article 8 thereof, precludes making the accrual of pension rights under an occupation scheme during the 14 weeks' maternity leave conditional upon the employee's receiving, by way of salary or Statutory Maternity Pay, income from her employer.

    Case C-364/97

    Commission of the European Communities v Ireland

    Social policy

    27 October 1998

    (Failure to fulfil obligations · Non-transposition of Directive 93/103/EC)

    (First Chamber)

    By application lodged at the Court Registry on 22 October 1997, the Commission of the European Communities brought an action for a declaration that, by not adopting and/or by not communicating to the Commission the laws, regulations and administrative provisions necessary to comply with Council Directive 93/103/EC of 23 November 1993 (hereinafter 'the Directive'), Ireland has failed to fulfil its obligations under the EC Treaty.

    The Irish Government does not deny the infringement, but states that draft ministerial orders transposing the Directive into national law are in the process of being adopted.

    It is settled law that the question whether a Member State has failed to fulfil its obligations must be determined by reference to the situation in the Member State as it stood at the end of the period laid down in the reasoned opinion, and that the Court cannot take account of any subsequent changes.

    Since the Directive was not transposed into national law within the period prescribed, the Commission's application must be regarded as well founded.

    The Court:

  • '1. Declares that, by failing to adopt within the period prescribed the laws, regulations and administrative provisions necessary to comply with Council Directive 93/103/EC of 23 November 1993 concerning the minimum safety and health requirements for work on board fishing vessels (thirteenth individual directive within the meaning of Article 16(1) of Directive 89/391/EEC), Ireland has failed to fulfil its obligations under Article 13(1) thereof;

    2. Orders Ireland to pay the costs.'

    Advocate General A. La Pergola delivered his Opinion at the sitting of the First Chamber on 17 September 1998.

    He proposed that the Court:

  • · uphold the application, declaring that Ireland has failed to fulfil its obligations under Article 13(1) of Council Directive 93/103/EC of 23 November 1993 concerning the minimum safety and health requirements for work on board fishing vessels (thirteenth individual Directive within the meaning of Article 16(1) of Directive 89/391/EEC), by not adopting within the prescribed period the laws, regulations and administrative provisions necessary to comply with that Directive; and

    · order Ireland to pay the costs.

    Case C-51/97

    Réunion Européenne SA and Others v Spliethoff's Bevrachtingskantoor BV and Capitaine Commandant le Navire 'Alblasgracht V002'

    Judgments Convention/Enforcement of judgments

    27 October 1998

    Preliminary ruling

    (Brussels Convention · Interpretation of Articles 5(1) and (3) and 6 · Claim for compensation by the consignee or insurer of the goods on the basis of the bill of lading against a defendant who did not issue the bill of lading but is regarded by the plaintiff as the actual maritime carrier)

    (Third Chamber)

    By judgment of 28 January 1997, the Cour de Cassation referred to the Court of Justice for a preliminary ruling four questions on the interpretation of Articles 5(1) and (3) and 6 of the Convention of 27 September 1968 on jurisdiction and the enforcement of judgments in civil and commercial matters, as amended by the Convention of 9 October 1978, 25 October 1982 and 26 May 1989 ('the Convention').

    Those questions arose in proceedings brought by nine insurance companies and, as lead insurer, the company Réunion Européenne (hereinafter 'the insurers'), which have been subrogated to the rights of the company Brambi Fruits (hereinafter 'Brambi'), whose registered office is in Rungis (France), against Spliethoff's Bevrachtingskantoor BV, whose registered office is in Amsterdam (Netherlands), and the Master of the vessel Alblasgracht V002, residing in the Netherlands, following the discovery of damage to a cargo of 5 199 cartons of pears delivered to Brambi, in the carriage of which the defendants were involved.

    The main proceedings

    The goods at issue in the main proceedings were carried by sea, from Melbourne (Australia) to Rotterdam (Netherlands) aboard the vessel Alblasgracht V002 under a bearer bill of lading issued on 8 May 1992 in Sydney, Australia, by Refrigerated Container Carriers PTY Ltd (hereinafter 'RCC'), whose registered office is in Sydney, then by road under an international consignment note, to Rungis in France, where Brambi discovered the damage.

    The insurers, having paid compensation for the damage suffered by Brambi and been subrogated to that, brought proceedings to recoup their loss against RCC, Spliethoff's Bevrachtingskantoor BV, and, finally, against the Master of the vessel Alblasgracht V002, before the Tribunal de Commerce (Commercial Court), Créteil, in whose jurisdiction Rungis is situated.

    The Tribunal de Commerce, Créteil, therefore considered that it should decline jurisdiction in the proceedings brought by the insurers against Spliethoff's Bevrachtingskantoor BV and the Master of the vessel Alblasgracht V002 in favour of the courts of Rotterdam, Rotterdam being the place of performance of the obligation within the meaning of Article 5(1) of the Convention, or those of Amsterdam or of Sydney pursuant to Article 6(1) of the Convention, according to which a person who is one of a number of defendants may be sued before the courts for the place where any one of them is domiciled.

    The Cour d'Appel (Court of Appeal), Paris, confirmed, by judgment of 16 November 1994, that the Tribunal de Commerce, Créteil, lacked international jurisdiction as regards Spliethoff's Bevrachtingskantoor BV and the Master of the vessel Alblasgracht V002, whereupon the insurers appealed to the Cour de Cassation.

    The Cour de Cassation decided to stay proceedings and refer as series of questions to the Court of Justice for a preliminary ruling.

    The first and second questions

    According to Spliethoff's Bevrachtingskantoor BV and the Master of the Alblasgracht V002, the dispute is a matter relating to a contract within the meaning of Article 5(1) of the Convention since the action against them is based on the bill of lading, the document containing the transport contract.

    According to settled case-law the phrase 'matter relating to a contract' in Article 5(1) of the Convention is to be interpreted independently and cannot be taken to refer to how the legal relationship in question before the national court is classified by the relevant national law.

    As the Court held in Handte of 17 June 1992, that the phrase 'matters relating to contract', as used in Article 5(1) of the Convention, is not to be understood as covering a situation in which there is no obligation freely assumed by one party towards the other.

    In the present case, that bill of lading discloses no contractual relationship freely entered into between Brambi on the one hand and, on the other, Spliethoff's Bevrachtingskantoor BV and the Master of the Alblasgracht V002, who, according to the insurers, were the actual maritime carriers of the goods.

    In those circumstances, the action brought against the latter by the insurers cannot be a matter relating to a contract within the meaning of Article 5(1) of the Convention.

    It is next necessary to determine whether such an action is concerned with a matter relating to tort, delict or quasi-delict within the meaning of Article 5(3) of the Convention.

    In Kalfelis v Schröder of 27 September 1988 the Court defined the concept of matters relating to tort, delict or quasi-delict within the meaning of Article 5(3) of the Convention as an independent concept covering all actions which seek to establish the liability of a defendant and which are not related to a 'contract' within the meaning of Article 5(1).

    That is the position in the main proceedings.

    The third question

    In the judgments of 30 November 1976, Mines de Potasse d'Alsace, and of 7 March 1995, Shevill and Others, the Court held that the expression 'place where the harmful event occurred' in Article 5(3) of the Convention must be understood as being intended to cover both the place where the damage occurred and

    the place of the event giving rise to it, so that the defendant may be sued, at the option of the plaintiff, in the courts for either of those places.

    That term cannot be construed so extensively as to encompass any place where the adverse consequences can be felt of an event which has already caused damage actually arising elsewhere.

    In an international transport operation of the kind at issue in the main proceedings, the place where the damage occurred cannot be either the place of final delivery, which can be changed in mid-voyage, or the place where the damage was ascertained.

    To allow the consignee to bring the actual maritime carrier before the courts for the place of final delivery or before those for the place where the damage was ascertained would in most cases mean attributing jurisdiction to the courts for the place of the plaintiff's domicile, whereas the authors of the Convention demonstrated their opposition to such attribution of jurisdiction otherwise than in the cases for which it expressly provides.

    In those circumstances, the place where the damage arose in the case of an international transport operation of the kind at issue in the main proceedings can only be the place where the actual maritime carrier was to deliver the goods.

    The fourth question

    It must be noted at the outset that the Convention does not use the term 'indivisible' in relation to disputes but only the term 'related', in Article 22.

    In the judgment of 24 June 1981, Elefanten Schuh, the Court held that Article 22 of the Convention applies only where related actions are brought before courts of two or more Contracting States.

    It is clear from the documents before the Court in this case that separate actions have not been brought before the courts of different Contracting States, so that, in any event, the conditions for the application of Article 22 are not met.

    It must next be borne in mind that, under Article 3 of the Convention, persons domiciled in a Contracting State may be sued in the courts of another Contracting State only by virtue of the rules set out in Sections 2 to 6 of Title II.

    Those rules include, in Article 6(1) of the Convention, the rule that a person may also be sued, 'where he is one of a number of defendants, in the courts for the place where any one of them is domiciled'.

    After pointing out that the purpose of Article 6(1) of the Convention, and of Article 22, is to ensure that judgments which are incompatible with each other are not given in the Contracting States, the Court held in Kalfelis that, for Article 6(1) of the Convention to apply there must exist between the various actions brought by the same plaintiff against different defendants a connection of such a kind that it is expedient to determine the actions together in order to avoid the risk of irreconcilable judgments resulting from separate proceedings.

    It follows that two claims in one action for compensation, directed against different defendants and based in one instance on contractual liability and in the other on liability in tort or delict cannot be regarded as connected.

    The Court ruled:

  • '1. An action by which the consignee of goods found to be damaged on completion of a transport operation by sea and then by land, or by which his insurer who has been subrogated to his rights after compensating him, seeks redress for the damage suffered, relying on the bill of lading covering the maritime transport, not against the person who issued that document on his headed paper but against the person whom the plaintiff considered to be the actual maritime carrier, falls within the scope not of matters relating to a contract within the meaning of Article 5(1) of the Convention of 27 September 1968 on jurisdiction and the enforcement of judgments in civil and commercial matters, as amended by the Convention of 9 October 1978 on the Accession of the Kingdom of Denmark, Ireland and the United Kingdom of Great Britain and Northern Ireland, by the Convention of 25 October 1982 on the Accession of the Hellenic Republic and by the Convention of 26 May 1989 on the Accession of the Kingdom of Spain and the Portuguese Republic, but of matters relating to tort, delict or quasi-delict within the meaning of Article 5(3) of that Convention.
  • 2. The place where the consignee of the goods, on completion of a transport operation by sea and then by land, merely discovered the existence of the damage to the goods delivered to him cannot serve to determine the "place where the harmful event occurred" within the meaning of Article 5(3) of the Convention of 28 September 1968, as interpreted by the Court.
  • 3. Article 6(1) of the Convention of 27 September 1968 must be interpreted as meaning that a defendant domiciled in a Contracting State cannot be sued in another Contracting State before a court seised of an action against a co-defendant not domiciled in a Contracting State on the ground that the dispute is indivisible rather than merely displaying a connection.'

    Advocate General G. Cosmas delivered his Opinion at the sitting of the Third Chamber on 5 February 1998.

    He proposed that the Court reply as follows:

  • 1. An action by which the consignee of goods found to be damaged on completion of a transport operation by sea and then by land, or by which his insurer who has been subrogated to his rights after compensating him, seeks redress for the damage suffered, relying on the bill of lading covering the maritime transport, not against the person who issued that document on his headed paper but against the person whom the plaintiff considered to be the actual maritime carrier, falls within the scope not of matters relating to a contract within the meaning of Article 5(1) of the Convention of 27 September 1968 on jurisdiction and the enforcement of judgments in civil and commercial matters, as amended by the Convention of 9 October 1978 on the Accession of the Kingdom of Denmark, Ireland and the United Kingdom of Great Britain and Northern Ireland, by the Convention of 25 October 1982 on the Accession of the Hellenic Republic and by the Convention of 26 May 1989 on the Accession of the Kingdom of Spain and the Portuguese Republic, but of matters relating to tort, delict or quasi-delict within the meaning of Article 5(3) of that Convention.
  • 2. The place where the consignee of the goods, on completion of a transport operation by sea and then by land, merely discovered the existence of the damage to the goods delivered to him cannot serve to determine the 'place where the harmful event occurred' within the meaning of Article 5(3) of the Convention of 28 September 1968, as interpreted by the Court.
  • 3. Article 6(1) of the Convention of 27 September 1968 must be interpreted as meaning that a defendant domiciled in a Contracting State cannot be sued in another Contracting State before a court seised of an action against a co-defendant not domiciled in a Contracting State on the ground that the dispute is indivisible rather than merely displaying a connection.

    Case C-4/97

    Manifattura Italiana Nonwoven SpA v Direzione Regionale delle Entrate per la Toscana

    Taxation

    27 October 1998

    Preliminary ruling

    (Directive 69/335/EEC · Taxes on the raising of capital · Tax on companies' net assets)

    (Sixth Chamber)

    By order of 18 October 1996, the Commissione Tributaria Provinciale di Firenze (Provincial Tax Court, Florence) referred to the Court for a preliminary ruling a question concerning the interpretation of Council Directive 69/335/EEC of 17 July 1969 as amended by Council Directive 85/303/EEC of 10 June 1985 ('the Directive').

    That question has arisen in a dispute between Manifattura Italiana Nonwoven SpA ('Nonwoven') and the Direzione Regionale delle Entrate per la Toscana concerning Nonwoven's application for reimbursement of an amount paid as tax on companies' net assets.

    According to Nonwoven, the tax contravened the prohibition in the Directive of making the raising of capital subject to any charge other than capital duty.

    The national court is essentially asking whether the Directive precludes the levying on capital companies of a tax such as the Italian tax on companies' net assets.

    As far as the objective characteristics of the tax at issue are concerned the various transactions which, in accordance with Article 4(1) of the Directive, must be subjected to capital duty are all transactions involving the transfer of capital or assets to a capital company in the taxing Member State. Similarly, the categories of transaction which, under Article 4(2), may be subject to capital duty all result in an effective increase in the company's capital or assets.

    A tax on assets such as that at issue, on the other hand, is levied annually, at the end of the financial year, on the net assets of companies as set out in their balance sheets. It does not presuppose any transaction involving the movement of capital or assets.

    It follows that a tax such as that at issue in the main proceedings is neither a capital duty nor a tax having the same characteristics as such a duty.

    The Court ruled:

    'Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital, as amended by Council Directive 85/303/EEC of 10 June 1985, does not preclude the levying on capital companies of a tax such as the tax on companies' net assets.'

    Advocate General N. Fennelly delivered his Opinion at the sitting of the Sixth Chamber on 18 June 1998.

    He suggested that the Court reply as follows:

    Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital, as amended by Council Directive 85/303/EEC of 10 June 1985 amending Directive 69/335/EEC, does not apply to the imposition on capital companies of a tax such as the annual tax on the net assets of companies introduced by virtue of Decree-Law of the Italian Republic No 394 of 30 September 1992.

    Joined Cases C-31/97 and C-32/97

    Fuerzas Eléctricas de Catalunya SA (FECSA) and Autopistas Concesionaria Española SA v Departament d'Economía and Finances de la Generalitat de Catalunya

    Taxation

    27 October 1998

    Preliminary ruling

    (Directive 69/335/EEC · Indirect taxes on the raising of capital · Duty on notarial deeds recording the repayment of debenture loans)

    (Sixth Chamber)

    By orders of 3 and 9 December 1996, the Tribunal Superior de Justicia de Catalunya (High Court of Justice, Catalonia) referred to the Court for a preliminary ruling a question on the interpretation of Articles 11(b) and 12 of Council Directive 69/335/EEC of 17 July 1969 (hereinafter 'the Directive').

    That question was raised in two sets of proceedings brought by Fuerzas Eléctricas de Catalunya SA (hereinafter 'FECSA') and Autopistas Concesionaria Española SA (hereinafter 'ACESA') against the Departament d'Economía i Finances de la Generalitat de Catalunya (Department of Economy and Finance of the Generalitat of Catalonia, hereinafter 'the tax authorities') concerning the payment of duty on notarial deeds recording the repayment of debenture loans.

    By order of the President of the Court of 4 February 1997, the cases were joined for the purposes of the written procedure, the oral procedure and the judgment.

    By its question, the national court seeks, in substance, to ascertain whether Article 11(b) of the Directive must be interpreted as meaning that the prohibition of taxation on debenture loans applies to the duty on notarial deeds recording the repayment of loans and, if so, whether such a duty is covered by the derogation provided for in particular in Article 12(1)(d) of the Directive.

    It must be remembered that Article 11(b) of the Directive prohibits taxation, of any form whatsoever, on loans raised by the issue of debentures or other negotiable securities, by whomsoever issued, or any formalities relating thereto, or the creation, issue, admission to quotation on a stock exchange, making available on the market or dealing in such debentures or other negotiable securities.

    It follows that Article 11(b) of the Directive must be interpreted as meaning that the prohibition of taxation on debenture loans extends to taxation on the repayment of such loans.

    It must then be remembered that Article 11(b) of the Directive prohibits not only taxation on debenture loans, but also on any formalities relating thereto.

    Accordingly, even if the duty at issue in the main proceedings is not chargeable on the repayment of loans as such, it is none the less levied on the notarial deeds which are obligatory to have the repayment registered, that is to say in respect of formalities relating thereto.

    Finally, it must be recognised that the Member States remain free, in accordance with Article 12(1)(d) of the Directive, to levy duties on the discharge of mortgages or other charges on land or other property. However, the repayment of a debenture loan constitutes a discrete financial transaction, separate from the discharge of a mortgage registered in order to secure the debentures resulting from the loan.

    It follows that, even if a debenture loan is secured by a mortgage, the repayment of the loan cannot be subject to taxation.

    The Court ruled:

    'Article 11(b) of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital must be interpreted as meaning that the prohibition of taxation on debenture loans applies to the duty on notarial deeds recording the repayment of loans. Such a duty cannot come within the derogation provided for in Article 12(1)(d) of the said directive.'

    Advocate General N. Fennelly delivered his Opinion at the sitting of the Sixth Chamber on 11 June 1998.

    He recommended that the Court reply as follows:

    Articles 11 and 12 of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital should be interpreted as precluding the levying of 0.5% duty on the notarial deed recording the redemption of a loan in circumstances such as those of the main proceedings.

    Case C-152/97

    Abbruzzi Gas SpA (Agas) v Amministrazione Tributaria di Milano

    Taxation

    27 October 1998

    Preliminary ruling

    (Directive 69/335/EEC · Indirect taxes on the raising of capital · Merger of companies · Acquisition by a company which already holds all the securities of the companies acquired)

    (Sixth Chamber)

    By order of 24 March 1997, the Commissione Tributaria Provinciale (Provincial Tax Court), Milan, referred for a preliminary ruling a question on the interpretation of Council Directive 69/335/EEC of 17 July 1969 as amended by Council Directive 85/303/EEC of 10 June 1985 (hereinafter 'the Directive').

    That question was raised in proceedings between Abruzzi Gas SpA, a company incorporated under Italian law, and the Amministrazione Tributaria di Milano concerning duty levied on the registration of a merger which took place through the acquisition by Agas of Briangas Spa and Italgasdotti Serio Srl.

    The question referred for a preliminary ruling

    By that question, the national court is essentially asking whether the Directive precludes the levying of registration duty where companies are acquired by another company which already holds all their stocks and shares.

    It is apparent from Article 1 of the Directive, read in conjunction with Article 4 thereof, that the duty levied on contributions to capital companies constitutes a 'capital duty' within the meaning of the Directive where it applies to transactions covered by the Directive.

    The transactions which are or may be rendered subject to the harmonised capital duty by the Member States are defined in Article 4 of the Directive objectively and with uniform application to all Member States.

    Consequently, if the transaction in question is to fall within the scope of the Directive, it must be possible to bring it within one of the cases described in Article 4 thereof to which Article 10(a) and (b) of the Directive refer. That is in turn subject to the prohibition laid down in Article 10(c) of the Directive on taxation in respect of registration or any other formality required before the commencement of business, to which a company may be subject by reason of its legal form.

    With reference to the present case, it should be noted, first of all, that a merger through acquisition by a company which already holds all the shares in the companies acquired does not entail any increase in the share capital of the acquiring company and does not therefore fall within the scope of Article 4(1)(c) of the Directive.

    Nor does such a transaction fall within the scope of Article 4(1)(d) of the Directive.

    Lastly, it should be noted that a transaction such as that at issue in the main proceedings is not covered by Article 4(2)(b) of the Directive. That provision presupposes that the increase in the assets consists in the provision of services by a member, which is not the position here.

    Secondly, as regards the applicability of Article 10(c) of the Directive, in a case such as that in point in the main proceedings, the registration duty does not appear to have been paid on the registration of a new capital company, that is to say, on completion of a formality required for the commencement of business. Furthermore, it was not levied on the registration of an increase in capital, necessary for the carrying on of that business.

    Consequently, the registration duty at issue in the main proceedings does not fall under the prohibition laid down in Article 10(c) of the Directive.

    It must be concluded that one of the aims pursued by the Directive does not apply to registration duty levied in respect of the acquisition of companies by a company which already holds all their share capital.

    The Court ruled:

    'Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital, as amended by Council Directive 85/303/EEC of 10 June 1985, does not preclude the levying of registration duty in respect of the acquisition of companies by a company which already holds all the shares in the companies acquired.'

    Advocate General G. Cosmas delivered his Opinion at the sitting of the Sixth Chamber on 25 June 1998.

    He proposed that the Court reply as follows:

    It is not contrary to Articles 4(1)(c) or 7(1)(b) of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital, as amended by Council Directive 85/303/EEC of 10 June 1985, for registration duty to be levied in respect of merger by acquisition of a company by another company which already holds 100% of the shares in the first company.

    Case C-230/97

    Ibiyinka Awoyemi

    Freedom of movement for persons

    29 October 1998

    Preliminary ruling

    (Driving licence · Interpretation of Directive 80/1263/EEC · Failure to comply with the obligation to exchange a licence issued by one Member State to a national of a non-member country for a licence from another Member State in which that person is now resident · Criminal penalties · Effect of Directive 91/439/EEC)

    (Second Chamber)

    By decision of 17 June 1997, the Hof van Cassatie (Court of Cassation) referred to the Court for a preliminary ruling three questions on the interpretation of Article 8(1) of the First Council Directive 80/1263/EEC of 4 December 1980 and of Articles 1(2) and 8(1) of Council Directive 91/439/EEC of 29 July 1991.

    Those questions were raised in criminal proceedings instituted by the public prosecutor's office against Mr Awoyemi, who was charged with driving a motor vehicle on the public highway in Belgium without being in possession of a valid driving licence.

    The first question

    It is apparent from the order for reference that, in its first question, the national court is essentially asking the Court whether the provisions of Directive 80/1263 or those of the Treaty preclude the driving of a motor vehicle by a national of a non-member country who holds a Community model driving licence issued by one Member State and who, having transferred his residence to another Member State, could have obtained a licence issued by the host State in exchange, but did not complete that formality within the prescribed period of one year, from being treated by the latter State as driving without a licence and thus rendered punishable by imprisonment or a fine.

    Directive 80/1263 makes no provision for the penalties to be imposed in the event of breach of the obligation laid down in the first subparagraph of Article 8(1) to exchange driving licences.

    Accordingly, in the absence of Community rules governing the matter, the Member States remain competent in principle to impose penalties for breach of such an obligation.

    Moreover, the Member States may not impose a criminal penalty in this area so disproportionate to the gravity of the infringement as to become an obstacle to the free movement of persons (judgment in Skanavi and Chryssanthakopoulos of 29 February 1996).

    However, a person such as Mr Awoyemi may not rely on that case-law.

    It follows from the judgment in Skanavi and Chryssanthakopoulos, that the justification for the restriction imposed on the power of the Member States to provide for criminal penalties in the event of breach of the obligation to exchange driving licences is the free movement of persons established by the Treaty.

    A national of a non-member country who finds himself in the same position as Mr Awoyemi may not effectively rely on the rules governing the free movement of persons which, in accordance with settled case-law, apply only to a national of a Member State of the Community who seeks to establish himself in the territory of another Member State or to a national of the Member State in question who finds himself in a situation which is connected with any of the situations contemplated by Community law.

    The second and third questions

    In its second and third questions, which it is appropriate to examine together, the national court is asking essentially whether a national of a non-member country who holds a valid Community model driving licence issued by one Member State, who has taken up normal residence in another Member State, but who has not exchanged his driving licence within the one-year period prescribed by the first subparagraph of Article 8(1) of Directive 80/1263, is entitled to rely directly on Articles 1(2) and 8(1) of Directive 91/439 in order to challenge the imposition, in the Member State in which he has established his new residence,

    of a term of imprisonment or a fine for driving without a licence, where that offence took place before the date set for compliance with Directive 91/439.

    In order to determine whether the aforesaid provisions of Directive 91/439 have direct effect, it should be borne in mind that, according to established case-law, wherever the provisions of a directive appear, as far as their subject-matter is concerned, to be unconditional and sufficiently precise, those provisions may be relied upon by an individual against the State, where the latter fails to transpose the directive into national law within the prescribed period or where it fails to implement the directive correctly.

    In that regard, it is apparent first of all from the actual wording of the second question submitted by the national court that Articles 1(2) and 8(1) of Directive 91/439 were not transposed into the national legal system concerned within the prescribed period and were not complied with, in accordance with Article 12 of that directive, as of 1 July 1996.

    Furthermore, with regard to the question whether those provisions of the directive are sufficiently precise and unconditional to be capable of being relied upon by an individual in proceedings before a national court, it should be noted, in the first place, that Article 1(2) provides for mutual recognition, without any formality, of driving licences issued by Member States and secondly, that Article 8(1) replaces simply with a right, conferred on the holder of a valid driving licence issued by one Member State where that person has taken up normal residence in another Member State, the obligation to exchange driving licences within the one-year period referred to in the first subparagraph of Article 8(1) of Directive 80/1263.

    As the Advocate General has stressed in points 37 to 41 of his Opinion, those provisions thus impose on Member States clear and precise obligations which consist in the mutual recognition of Community model driving licences and in the prohibition on requiring the exchange of driving licences issued by another Member State, regardless of the nationality of the holder, since the Member States have no discretion as to the measures to be adopted in order to comply with those requirements.

    It may be inferred from the direct effect which should therefore be attributed to Articles 1(2) and 8(1) of Directive 91/439 that individuals are entitled to rely on them in proceedings before the national courts.

    The Court ruled:

  • '1. Neither the provisions of the First Council Directive 80/1263/EEC of 4 December 1980 on the introduction of a Community driving licence, nor those of the EC Treaty, preclude the driving of a motor vehicle by a national of a non-member country who holds a Community model driving licence issued by one Member State and who, having transferred his residence to another Member State, could have obtained a licence issued by the host State in exchange, but did not complete that formality within the prescribed period of one year, from being treated by the latter State as driving without a licence and thus rendered punishable by imprisonment or a fine.
  • 2. A national of a non-member country who holds a valid Community model driving licence issued by one Member State, who has taken up normal residence in another Member State, but who has not exchanged his driving licence within the one-year period prescribed by the first subparagraph of Article 8(1) of Directive 80/1263, is entitled to rely directly on Articles 1(2) and 8(1) of Council Directive 91/439/EEC of 29 July 1991 on driving licences in order to challenge the imposition, in the Member State in which he has established his new residence, of a term of imprisonment or a fine for driving without a licence. Community law does not prevent a court of such a Member State,by reason of the principle that forms part of national law in certain Member States of the retroactive effect of more favourable provisions of criminal law, from applying the aforesaid provisions of Directive 91/439 even where the offence took place before the date set for compliance with that directive.'

    Advocate General P. Léger delivered his Opinion at the sitting of the Second Chamber on 16 July 1998.

    He proposed that the Court give the following answers to the questions referred by the Belgian Hof van Cassatie:

  • 1. Neither the provisions of the First Council Directive 80/1263/EEC of 4 December 1980 on the introduction of a Community driving licence, in particular Article 8 thereof, nor the provisions of the EC Treaty preclude the driving of a motor vehicle by a person who is not a European Union citizen but who holds a national driving licence or a Community model licence issued by a Member State, and who in exchange for his licence could have obtained a licence of the State in which he has settled but has not made that exchange within the prescribed period, from being treated as driving without a licence and thus rendered punishable by imprisonment or a fine.
  • 2. Where they have not been transposed into the domestic legal system and by reason of the principle that exists in the domestic law of some Member States of the direct application of more lenient criminal provisions, Articles 1(2) and 8(1) of Council Directive 91/439/EEC of 29 July 1991 on driving licences preclude the driving of a motor vehicle, at a time when Directive 80/1263 was still in force, by the holder of a Community model driving licence who is not a national of a Member State and who has not exchanged his licence for a licence from the Member State in which he has settled within the prescribed period, from being treated as driving without a licence and thus rendered punishable by imprisonment or a fine.

    Case C-410/97

    Commission of the European Communities v Grand Duchy of Luxembourg

    Social policy

    29 October 1998

    (Failure of a Member State to fulfil its obligations · Failure to transpose Directive 92/29/EEC)

    (Fourth Chamber)

    By application lodged at the Court Registry on 5 December 1997, the Commission of the European Communities brought an action for a declaration that, by failing to adopt the laws, regulations and

    administrative provisions necessary to comply with Council Directive 92/29/EEC of 31 March 1992 (hereinafter 'the Directive'), the Grand Duchy of Luxembourg has failed to fulfil its obligations under that directive.

    Since the transposition of the Directive has not been achieved within the period prescribed therein, the action brought by the Commission in this connection must be held to be well founded.

    The Court held:

  • '0.1.  Declares that, by failing to adopt, within the prescribed period, the laws, regulations and administrative provisions necessary to comply with Council Directive 92/29/EEC of 31 March 1992 on the minimum safety and health requirements for improved medical treatment on board vessels, the Grand Duchy of Luxembourg has failed to fulfil its obligations thereunder.

    0.2.  Orders the Grand Duchy of Luxembourg to pay the costs.'

    Advocate General D. Ruiz-Jarabo Colomer delivered his Opinion at the sitting of the Fourth Chamber on 14 July 1998.

    He proposed that the Court should uphold the Commission's application and:

  • 1. Declare that, by failing to adopt, within the prescribed period, the laws, regulations or administrative provisions needed in order to comply with Council Directive 92/29/EEC of 31 March 1992 on the minimum safety and health requirements for improved medical treatment on board vessels, the Grand Duchy of Luxembourg has failed to fulfil its obligations under the EC Treaty.

    2. Order the Grand Duchy of Luxembourg to pay the costs.

    Case C-185/96

    Commission of the European Communities v Hellenic Republic

    Freedom of movement for persons

    29 October 1998

    (Failure of a Member State to fulfil its obligations · Benefits for large families · Discrimination)

    (Fifth Chamber)

    By application lodged at the Court Registry on 31 May 1996, the Commission of the European Communities brought an action for a declaration that, by precluding by regulation or administrative practice on the grounds of their nationality employed or self-employed workers from other Member States and the members of their families from being attributed large-family status for the purpose of the award of special benefits for such families and from being awarded family allowances, the Hellenic Republic has failed to fulfil its obligations under Articles 48 and 52 of the EC Treaty, Article 7 of Council Regulation (EEC) No 1612/68 of 15 October 1968, Article 7 of Commission Regulation (EEC) No 1251/70 of 29 June 1970 and Article 3 of Council Regulation (EEC) No 1408/71 of 14 June 1971.

    In the Commission's submission, all the advantages provided for by the Greek legislation at issue, with the exception of exemption from military service under Article 5 of Law No 1910/1944 which concerns only Greek nationals, constitute social advantages within the meaning of Article 7(2) of Regulation No 1612/68 or social security benefits within the meaning of Article 4(1) of Regulation No 1408/71.

    The Commission concludes that the legislation at issue, in so far as it gives rise to discrimination directly based on grounds of nationality, or in so far as the manner of its implementation leads to the same result, is contrary to the principle of the free movement of persons laid down in Articles 48 and 52 of the Treaty and, more specifically, to the principle of equal treatment for workers, implemented by Article 7(2) of Regulation No 1612/68 and by Article 3(1) of Regulation No 1408/71.

    Since the present action calls for consideration of the application of the principle of equal treatment in relation to both social advantages and social security benefits, the meaning of those concepts must be re-examined.

    First, as regards social advantages, it is settled law that this concept embraces all the advantages which, whether or not linked to a contract of employment, are generally granted to national workers primarily because of their objective status as workers or by virtue of the mere fact of their residence on the national territory.

    It follows from that definition that all the advantages for which the Greek legislation at issue provides in relation to large families constitute social advantages within the meaning of Article 7(2) of Regulation No 1612/68 workers who are nationals of other Member States must be eligible for those advantages on the same terms as national workers. Equal treatment in that sense must also extend to dependent members of their families.

    In imposing a discriminatory nationality requirement, the administrative practice, like the legislative provisions in issue, infringes Article 48(2) of the Treaty, Article 7(2) of Regulation No 1612/68 and Article 7 of Regulation No 1251/70. For the same reason, they also constitute an infringement of Article 52 of the Treaty and Article 7 of Directive 75/34.

    Secondly, as regards social security benefits, the Court has ruled on numerous occasions that a benefit may be regarded as a social security benefit in so far as it is granted, without any individual and discretionary assessment of personal needs, to recipients on the basis of a legally defined position, and provided that it concerns one of the risks expressly listed in Article 4(1) of Regulation no 1408/71.

    It is apparent from that definition that, among the benefits provided for by Law No 1910/1944, those relating to health-care also constitute social security benefits.

    The same is true of the cash benefits provided for by Decree-Law No 1153/1972 and by Article 63(1) to (4) of Law No 1892/1990.

    Accordingly, the administrative practice and legislative provisions making the award of those benefits subject to discriminatory nationality requirements are also contrary to the rule laid down in Article 3(1) of Regulation No 1408/71.

    The Greek Government has contended, in particular, that the Greek nationality requirement to which the grant of the benefits provided for by Article 63(1) to (4) of Law No 1892/1990 is subject is justified because those benefits help to further demographic policy aims.

    On that point, it should be recalled that the Court has consistently held that social measures cannot be regarded as exempt from the application of the rules of Community law solely because they have been adopted for reasons of demographic policy.

    The Court held:

  • '1. Declares that, by precluding by regulation or administrative practice on the grounds of their nationality employed or self-employed workers from other Member States and the members of their families from being attributed large-family status for the purpose of the award of special benefits for such families and from being awarded family allowances, the Hellenic Republic has failed to fulfil its obligations under:

    · Articles 48 and 52 of the EC Treaty;

  • · Article 7 of Council Regulation (EEC) No 1612/68 of 15 October 1968 on freedom of movement for workers within the Community;
  • · Article 7 of Commission Regulation (EEC) No 1251/70 of 29 June 1970 on the right of workers to remain in the territory of a Member State after having been employed in that State;
  • · Article 7 of Council Directive 75/34/EEC of 17 December 1974 concerning the right of nationals of a Member State to remain in the territory of another Member State after having pursued therein an activity in a self-employed capacity; and
  • · Article 3 of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community;

    2. Orders the Hellenic Republic to pay the costs.'

    Advocate General S. Alber delivered his Opinion at the sitting of the Fifth Chamber on 30 April 1998.

    He proposed that the Court:

  • 1. Declare that, by precluding by regulation or administrative practice on the grounds of their nationality employed or self-employed workers from other Member States and the members of their families from being attributed large-family status for the purpose of the award of special benefits for such families and from being awarded family allowances, the Hellenic Republic has failed to fulfil its obligations under Community law, in particular Articles 48 and 52 of the EC Treaty and Article 7 of Council Regulation (EEC) No 1612/68 of 15 October 1968 on freedom of movement for workers within the Community, Article 7 of Commission Regulation (EEC) No 1251/70 of 29 June 1970 on the right of workers to remain in the territory of a Member State after having been employed in that State, Article 7 of Council Directive 75/34/EEC of 17 December 1974 concerning the right of nationals of a Member State to remain in the territory of another Member State after having pursued therein an activity in a self-employed capacity, and Article 3 of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community.

    2. Order the Hellenic Republic to pay the costs.

    Case C-375/96

    Galileo Zaninotto v Ispettorato Centrale Repressione Frodi - Ufficio di Conegliano - Ministero delle Risorse Agricole, Alimentari and Forestali

    Agriculture

    29 October 1998

    Preliminary ruling

    (Agriculture · Common organisation of the agricultural markets · Market in wine · Compulsory distillation scheme)

    (Fifth Chamber)

    By order of 2 November 1996, the Pretura Circondariale di Treviso, Sezione Distaccata di Conegliano (District Magistrate's Court, Treviso, Conegliano Division) referred to the Court for a preliminary ruling a number of questions on the validity of the fourth indent of Article 1(3) of Commission Regulation (EC) No 343/94 of 15 February 1994 of Article 1(1)(c), (2) and (3) of Commission Regulation (EC) No 465/94 of 1 March 1994 as amended by Commission Regulation (EC) No 610/94 of 18 March 1994, of Article 39(1) and (4) of Council Regulation (EEC) No 822/87 of 16 March 1987 of Article 4(2) of Commission Regulation (EEC) No 441/88 of 17 February 1988 and of Article 1(1) of Commission Regulation (EC) No 3151/94 of 21 December 1994.

    Those questions were raised in proceedings between Mr Zaninotto, a wine-grower, and the Ispettorato Centrale Repressione Frodi · Ufficio di Conegliano · Ministero delle Risorse Agricole, Alimentari e Forestali (Conegliano Office of the Central Inspectorate for the Prevention of Fraud in the Ministry of Agriculture, Food and Forest Resources; hereinafter 'the Ministry') concerning a fine imposed on him under national law for contravention of the Community rules on the compulsory distillation of table wine. Mr Zaninotto alleges that the Community rules requiring Italian producers to distil certain quantities of table wine in the 1993/94 wine year are unlawful.

    The first question

    By its first question, the referring court wishes to know whether the provisions by which the total quantity of table wine to be distilled was set at 12 150 000 hl for Italy in respect of the 1993/94 wine year are valid.

    Alleged discrimination against the Italian Republic in relation to the other Member States

    The applicant in the main proceedings and the Italian Government consider that the total quantity for distillation set for Italy was such that the obligation to distil was apportioned among the Member States concerned in a discriminatory manner and Italy was penalised significantly. Under Regulation No 343/94, two-thirds of the 18 200 000 hl of wine to be distilled in the Community in the 1993/94 wine year were Italian although its production was much less than two-thirds of total Community production.

    The Commission has pointed out that Community table wine production in the 1993/94 wine year showed a large surplus until January 1994, so that it was appropriate for compulsory distillation to be undertaken in order to safeguard the price and quality of table wine. Since Italy's production was much larger than that of any other region, it had to bear the costs of distillation in proportion to its overall production.

    In that regard, the Commission set out its method of calculation in response to a written question put by the Court.

    The relatively high share of the Italian Republic compared with the other Member States results from the exceptional size of the surpluses in Italy.

    As regards the apportionment of the obligation to distil, the Court finds, on the basis of those calculations, that the Italian Republic did not suffer from different treatment in relation to the other Member States.

    Inaccuracy of the data forwarded by the Italian Republic

    The applicant in the main proceedings considers that the obligation to distil the prescribed quantity of wine resulted in discrimination against Italian wine-growers, because the figure of 12 150 000 hl was calculated on the basis of inaccurate national data.

    The applicant in the main proceedings states that on 15 February 1994, the date on which Regulation No 343/94 opening compulsory distillation for the 1993/94 wine year was adopted, the Commission was not yet in possession of the table wine production figures which were to be forwarded by the Italian Republic.

    In that regard, it must be noted that the third recital in the preamble to the forward estimate for the 1993/94 wine year records that the Member States had forwarded information to the Commission on harvest and stock declarations relating to wine products in accordance with the provisions of Commission Regulation (EEC) No 3929/87 of 17 December 1987.

    Finally, it has not been established that the data supplied by the Italian authorities were inaccurate. Even if they were inaccurate, the applicant in the main proceedings has not, in any event, adduced any evidence that their inaccuracy operated against Italian producers rather than in their favour.

    Carrying-over of undistilled quantities from one wine year to the next

    The applicant in the main proceedings further asserts that the total quantity for distillation imposed on Italy also discriminated against wine-growers subject to the obligation to distil, because they were required to assume responsibility for quantities of table wine which should have been distilled by other (defaulting) producers during the preceding wine year. Those quantities, which were still on the market a year later, were treated as part of the stock of the current wine year, so that the calculation of the current quantity for distillation was distorted by taking them into account (having a 'decanting effect'). That calculation is therefore unlawful.

    The Commission states that the calculation of wine stocks on the market must include quantities which, in breach of the legislation in force, were not distilled, but were put on sale and are therefore on the market. The Commission states that if wine which was not distilled during the preceding wine year were to remain on the market indefinitely without being incorporated into the following year's stock, that would undermine the purpose of compulsory distillation and harm all producers. The burden of the surplus at issue was not placed on Italian producers alone; it was redistributed among all Community producers in accordance with the principle of solidarity, an approach consistent with the prohibition of discrimination as interpreted by the Court.

    Accordingly, it does not appear that the carrying over of undistilled quantities from one wine year to the next, as effected by the Commission, gave rise to discrimination between wine-growers subject to the obligation to distil.

    Question 2

    By its second question, the referring court asks whether some of the provisions in question are not invalid on the ground that they contravene the principle of the protection of legitimate expectations. It inquires whether the unequal apportionment of the quantity for distillation, the obvious inaccuracies in the calculation of that quantity and the carrying over of quantities not distilled during the 1992/93 wine year as stocks of the 1993/94 wine year did not thwart the legitimate expectations of Italian wine-growers who, having fulfilled the obligation to distil in the 1992/93 wine year, believed that they would not subsequently be burdened with other liabilities which relate in reality to the 1992/93 wine year.

    It is settled case-law that the principle of the protection of legitimate expectations may be invoked as against Community rules only to the extent that the Community itself has previously created a situation which can give rise to a legitimate expectation. The arguments relied on by the referring court, and adopted by the applicant in the main proceedings, in support of the contention that the legitimate expectations of Italian wine-growers were thwarted are not such as to establish that the Community created such a specific situation.

    Question 3

    By its third question, the referring court asks whether some of the rpovisions in question are not invalid because their enactment by the Commission was ultra vires and, in particular, because Article 31 of Regulation No 822/87 was infringed.

    More precisely, the referring court inquires whether the Commission's setting of the quantity for compulsory distillation applicable to Italy was not misconceived in so far as the yield per hectare, which is calculated by dividing the volume of production by the area under vines, could not be determined correctly for that region in the absence of a reliable national register.

    In that regard, it is apparent from Article 39(3) of Regulation No 822/87 that, when determining the volume of table wine to be distilled in respect of each Member State, account is not taken of the surface areas from which the wine originates, but only of that State's volume of production, which is ascertained on the basis of the harvest declarations in particular. It follows that the absence of a vineyard register did not affect the determination of the quantities for distillation.

    Question 4

    By its fourth question, the referring court asks whether Article 39(4) of Regulation No 822/87, under which the quantities for distillation are to be apportioned among the various producers in a region on the basis of yield per hectare, is not invalid because it contravenes the principle of proportionality.

    It is to be remembered that the principle of proportionality, which is one of the general principles of Community law, requires that measures adopted by Community institutions do not exceed the limits of what is appropriate and necessary in order to attain the objectives legitimately pursued by the legislation in question; when there is a choice between several appropriate measures recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued.

    So far as concerns judicial review of compliance with the abovementioned conditions, in matters concerning the common agricultural policy the Community legislature has a discretionary power which corresponds to the political responsibilities given to it by Articles 40 to 43 of the Treaty. Consequently, the legality of a measure adopted in that sphere can be affected only if the measure is manifestly inappropriate having regard to the objective which the competent institution is seeking to pursue.

    In this case, the choice to apportion obligations between wine producers from the same region according to their yield per hectare is not vitiated by a manifest error, since it is designed to impose most of the burden of compulsory distillation on the producers who are principally responsible for the overproduction in the table wine market, while not penalising producers who achieve low yields. That measure therefore cannot be regarded as disproportionate in relation to the objective pursued which is to absorb surpluses of table wine on the market.

    Question 5

    By its fifth question, the referring court calls into question the decision of the Commission to equate the territories of the Member States with the wine-growing regions in the Community, in particular to equate Italy with wine-growing zone C.

    The applicant in the main proceedings argues that, since Italy's national territory is made up of areas which obviously differ widely both from a geographical and from an oenological point of view, the Commission, which did not take account of those realities, exceeded the limits of its discretion.

    In that regard, it must be held that in an entity composed of Member States, such as the European Community, it is clearly reasonable to take the territory of those Member States as a point of reference for administrative purposes. Even though geographical and economic conditions may not be identical in the various parts of national territory, the Commission was therefore entitled, in the exercise of its discretion, to regard the whole of the territory of a Member State as a single region, provided that such a decision was not manifestly unsuited to the structures of the Member State in question.

    Questions 6 and 7

    By its sixth and seventh questions, the referring court asks whether Article 1(1) of Regulation No 3151/94, which extended to 29 January 1995 the time-limit for delivering table wine to a distillery in respect of the 1993/94 wine year, is valid.

    I

    n that regard, it is clear from the order for reference that the Ministry imposed a penalty on Mr Zaninotto for the non-distillation of the quantities to be delivered by him during the 1993/94 wine year. That presupposes, therefore, that Mr Zaninotto did not make use of the additional possibility of carrying out distillation subsequently and avoiding the penalty in that way.

    The validity of the provision in issue thus manifestly has no bearing on the outcome of the main proceedings.

    In accordance with settled case-law, it must be held that the questions referred to the Court for a preliminary ruling do not involve an interpretation of Community law objectively required for the decision to be taken by the national tribunal.

    Accordingly, the Court lacks jurisdiction to answer the sixth and seventh questions.

    The Court ruled:

    'Examination of the questions raised has disclosed no factor of such a kind as to affect the validity of:

  • · the fourth indent of Article 1(3) of Commission Regulation (EC) No 343/94 of 15 February 1994 opening compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87 and derogating for the 1993/94 wine year from certain detailed rules for the application thereof;
  • · Article 1(1)(c) and (2) of Commission Regulation (EC) No 465/94 of 1 March 1994 fixing for the 1993/94 wine year the percentages of table wine production to be delivered for compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87, in Regions 3 and 6, as amended by Commission Regulation (EC) No 610/94 of 18 March 1994;
  • · Article 39(1) and (4) of Council Regulation (EEC) No 822/87 of 16 March 1987 on the common organisation of the market in wine; or
  • · the fourth indent of Article 4(2) of Commission Regulation (EEC) No 441/88 of 17 February 1988 laying down detailed rules for applying compulsory distillation as referred to in Article 39 of Regulation No 822/87.'

    Advocate General G. Cosmas delivered his Opinion at the sitting of the Fifth Chamber on 28 May 1998.

    He proposed that the Court rule as follows:

    The analysis above has disclosed no factor of such a kind as to affect the validity of:

  • · the fourth indent of Article 1(3) of Commission Regulation (EC) No 343/94 of 15 February 1994 opening compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87 and derogating for the 1993/94 wine year from certain detailed rules for the application thereof;
  • · Article 1(1)(c) and (2), second paragraph, of Commission Regulation (EC) No 465/94 of 1 March 1994 fixing for the 1993/94 wine year the percentages of table wine production to be delivered for compulsory distillation as provided for in Article 39 of Council Regulation (EEC) No 822/87, in Regions 3 and 6, as amended by Commission Regulation (EC) No 610/94 of 18 March 1994;
  • · Article 39(4) of Council Regulation (EEC) No 822/87 of 16 March 1987 on the common organisation of the market in wine;
  • · the fourth indent of Article 4(2) of Commission Regulation (EEC) No 441/88 of 17 February 1988 laying down detailed rules for applying compulsory distillation as referred to in Article 39 of Regulation No 822/87;
  • · Article 1(1) of Commission Regulation (EC) No 3151/94 of 21 December 1994 introducing a further derogation from the detailed rules for the delivery by producers of the table wine they are required to deliver for compulsory distillation in respect of the 1993/94 wine year.

    Case C-114/97

    Commission of the European Communities v Kingdom of Spain

    Freedom of movement for persons

    29 October 1998

    (Failure of a Member State to fulfil obligations · Free movement of workers · Freedom of establishment · Freedom to provide services · Private security activities · Nationality conditions)

    (Fifth Chamber)

    By application lodged at the Court Registry on 19 March 1997, the Commission of the European Communities brought an action for a declaration that, by maintaining in force Articles 7, 8 and 10 of Law

    No 23/19

    authorisation to carry on private security activities, in the case of security companies, subject to the requirement of being constituted in Spain and the requirement that their directors and managers should reside in Spain and the requirement that security staff should possess Spanish nationality, the Kingdom of Spain had failed to fulfil its obligations under the EC Treaty, in particular Articles 48, 52 and 59.

    Articles 7, 8 and 10 of the Law entail restrictions on freedom of establishment, freedom to provide services and freedom of movement for workers.

    It is necessary, however, to consider whether those obstacles are justified by the derogations provided for by the Treaty.

    As far as Article 48(4) of the Treaty is concerned, it must be observed that private security undertakings do not form part of the public service and that this provision is not therefore applicable in this case.

    Moreover, it is apparent from the documents before the Court that private security undertakings and private security staff are not directly and specifically involved in the exercise of official authority and that

    the exception provided for in the first paragraph of Article 55 combined, where appropriate, with Article 66 of the Treaty does not apply in this case.

    Articles 48(3), 56(1) and 66 of the Treaty

    The nationality condition imposed on security undertakings and security staff by Articles 7 and 10 of the Law excludes the exercise, by a person or undertaking possessing the nationality of another Member State, of private security activities.

    Such a general exclusion from access to certain occupations cannot be justified on the grounds of public policy, public security or public health referred to in Articles 48(3) and 56 of the Treaty.

    Finally, the rule according to which directors and managers of all security undertakings must reside in Spain constitutes an obstacle to freedom of establishment and to the freedom to provide services.

    This condition is not necessary in order to ensure public security in the Member State concerned and is not therefore covered by the derogation provided for by Article 56(1) combined, where appropriate, with Article 66 of the Treaty.

    The Court:

    No 23/19

    1992, in so far as those provisions make the grant of authorisation to carry on private security activities, in the case of security companies, subject to the requirement of being constituted in Spain and the requirement that their directors and managers should reside in Spain and the requirement that security staff should possess Spanish nationality, the Kingdom of Spain has failed to fulfil its obligations under Articles 48, 52 and 59 of the EC Treaty;

    2. Orders the Kingdom of Spain to pay the costs.'

    Advocate General S. Alber delivered his Opinion at the sitting of the Fifth Chamber on 7 May 1998.

    He proposed that the Court:

    No 23/19

    authorisation to carry on private security activities in the case of 'security companies' subject to the requirement of being constituted in Spain, the requirement that their directors and managers should reside in Spain and the requirement that the 'security staff' should possess Spanish nationality, the Kingdom of Spain has failed to fulfil its obligations under the EC Treaty, in particular Articles 48, 52 and 59.

    2. Order the Kingdom of Spain to pay the costs.

    Joined Cases C-193/97 and C-194/97

    Manuel de Castro Freitas, Raymond Escallier v Ministre des Classes Moyennes et du Tourisme

    Freedom of movement for persons

    29 October 1998

    Preliminary ruling

    (Freedom of establishment · Directive 64/427/EEC · Activities of self-employed persons in manufacturing and processing industries · Conditions for taking up an occupation)

    (Fifth Chamber)

    By two judgments of 7 May 1997 the Tribunal Administratif (Administrative Court), Luxembourg, referred to the Court for a preliminary ruling three questions on the interpretation of Article 52 of the EC Treaty and Article 3 of Council Directive 64/427/EEC of 7 July 1964 (hereinafter 'the Directive').

    Those questions arose in the context of two actions brought, by Mr de Castro Freitas and Mr Escallier respectively, against two decisions of the Ministre des Classes Moyennes et du Tourisme (Minister for Small and Medium-sized Businesses and the Self-employed, and for Tourism refusing to grant them the licences for which they had applied in order to carry on a number of trades in Luxembourg.

    By those questions, which should be considered together, the national court is asking in substance whether on a proper construction of Article 3 of the Directive, where, in a Member State, the possession of specific knowledge and ability is a condition for taking up and pursuing an activity as a self-employed person in a manufacturing or processing industry or small craft industry, that Member State may require of a Community national who applies for licences to pursue occupational activities in that Member State which he is certified by the competent authorities of his Member State of origin to have pursued there, that he have completed separately, in respect of each of the trades whose scope is defined by the legislation of the host State, the periods prescribed by that article.

    Failing harmonisation of the conditions for access to the activities in question, the Member States remain, in principle, competent to define the general, commercial or professional knowledge and ability necessary in order to engage in the activities in question and to require production of diplomas, certificates or other formal evidence attesting that applicants possess such knowledge and ability.

    Moreover, the Member States must none the less, when exercising their powers in this area, respect both the basic freedoms guaranteed by Articles 52 and 59 of the EC Treaty and the effectiveness of a directive laying down transitional measures.

    The first paragraph of Article 3(1) of the Directive provides that where, in a Member State, the taking up or pursuit of any activity covered by the Directive is dependent on the possession of specific qualifications, 'that Member State shall accept as sufficient evidence of such knowledge and ability the fact that the activity in question has been pursued in another Member State'.

    In accordance with Article 4(3) of the Directive, the host Member State is to grant authorisation to pursue an occupational activity on application by the person concerned where the activity certified by the competent authority of the Member State of origin conforms to the main features of the description of the

    activity, as previously communicated by the host Member State, and where any other requirements laid down by the rules of that State are satisfied.

    The Court has already held that the competent authority of the Member State of origin must certify whether the applicant's pursuit of the activity in question was genuine and real and took place over a given number of consecutive years, that is to say, without any interruption other than those occurring in the ordinary course of life.

    The host Member State is bound by the declarations contained in the certificate issued by the Member State of origin and by any additional information requested.

    The host Member State may not, therefore, define either the conditions for taking up each of the small craft occupations or their scope in such a way that a certificate issued by the competent authorities of the Member State of origin is rendered useless for the purpose of enabling the applicant to engage in the occupation to which that certificate relates in the host Member State.

    The Court ruled:

    'On a proper construction of Article 3 of Council Directive 64/427/EEC of 7 July 1964 laying down detailed provisions concerning transitional measures in respect of activities of self-employed persons in manufacturing and processing industries falling within ISIC Major Groups 23-40 (Industry and small craft industries), where, in a Member State, the possession of specific knowledge and ability is a condition for taking up and pursuing an activity as a self-employed person in a manufacturing or processing industry or small craft industry, that Member State may not require of a Community national who applies for licences to pursue occupational activities in that Member State which he is certified by the competent authorities of his Member State of origin to have pursued there, that he have completed separately, in respect of each of the trades whose scope is defined by the legislation of the host State, the periods prescribed by that article.'

    Advocate General D. Ruiz-Jarabo Colomer delivered his Opinion at the sitting of the Fifth Chamber on 5 March 1998.

    He proposed that the Court of Justice reformulate the questions referred and answer them as follows:

    'It is contrary to Article 52 of the Treaty and Articles 3 and 4 of Council Directive 64/427 EEC of 7 July 1964 laying down detailed provisions concerning transitional measures in respect of activities of self-employed persons in manufacturing and processing industries falling within ISIC Major Groups 23-40 (Industry and small craft industries) for a Community national who provides to the authorities of the host Member State of origin, evidence that he has simultaneously pursued more than one trade for the reasonable period laid down for his situation, and that he did not cease pursuing those trades more than ten years earlier, to be refused a licence to pursue part of those trades on the ground that, in the host Member State, they are regarded as principal and separate trades, and the authorities of that Member State consider that the condition requiring the activity to have been pursued for a reasonable period must be satisfied separately in respect of each trade.'

    Court of First Instance

    Case T-13/96

    TEAM Srl v Commission of the European Communities

    External relations

    29 October 1998

    (PHARE programme · Decision to annul an invitation to tender and issue a new invitation to tender · Action for damages · Admissibility · Damage resulting from the loss suffered by a tenderer, from its loss of profit and from the harm caused to its image)

    (Fourth Chamber)

    Legal background and facts of the case

    The applicant, TEAM Srl, is an engineering consultancy company incorporated under Italian law specialising in the construction, management and maintenance of civil engineering, industrial and infrastructure projects.

    The PHARE programme, based on Council Regulation (EEC) No 3906/89 of 18 December 1989 as amended by Council Regulations (EEC) No 2698/90 of 17 September 1990, No 3800/91 of 23 December 1991, No 2334/92 of 7 August 1992, No 1764/93 of 30 June 1993 and No 1366/95 of 12 June 1995 is the framework within which the European Community channels economic aid to the countries of central and eastern Europe in order to implement measures intended to support the process of economic and social reform under way in those countries.

    Article 23 of the General Regulations for Tenders and the Award of Service Contracts financed from PHARE/TACIS Funds, in the version thereof applicable at the material time in the present case, provides that the tender procedure may be annulled by the contracting authority in certain circumstances.

    On 13 June 1995 the Commission issued a restricted invitation to tender for a feasibility study for the modernisation of a railway junction in Warsaw on the E-20 line ('the invitation to tender of 13 June 1995'). That invitation to tender was sent to, amongst others, the applicant and Centralne Biuro Projektowo-Badawcze Budownictwa Kolejowego (Kolprojekt) (hereinafter 'Kolprojekt'), a Polish public-owned company providing railway engineering consultancy services. Having formed a consortium to take part jointly in the procedure ('the consortium'), with Kolprojekt acting as the lead tenderer, the two undertakings submitted their tender.

    By fax of 16 November 1995 the Commission informed the tenderers that the invitation to tender had been cancelled due to the introduction of new objectives and modified terms of reference ('the contested decision').

    On 4 December 1995 the Commission issued, 'on behalf of the Government of Poland', a new restricted invitation to tender for a feasibility study for the modernisation of the Warsaw railway node on the E-20

    TEN line ('the contested invitation to tender'). The shortlist of undertakings invited to submit tenders included the applicant, but not Kolprojekt.

    By fax of 21 December 1995, the Commission announced that, in response to questions and remarks from several tenderers, the submission of bids was, in the meantime, deferred and the deadline postponed.

    Procedure and forms of order sought

    By application lodged at the Registry of the Court of First Instance on 26 January 1996, the applicant and Kolprojekt brought the present action, claiming that the Court should:

  • · annul the Commission decision contained in the letter of 16 November 1995 and the contested invitation to tender;

    · award them compensation for the damage suffered;

    · order the Commission to pay the costs.

    By fax of 28 May 1996, the Ministry of Transport and Maritime Economy of the Republic of Poland asked the Commission to withdraw the Warsaw railway junction study from the PHARE PL 9406 programme and to replace it with other urgent railway projects.

    By letter of 3 June 1996, the Commission informed the Polish ministry that the Commission had acceded to its request.

    By letter of the same date, the Commission informed the applicant and Kolprojekt of the Polish ministry's request and of the Commission's consequent decision to annul the whole tendering procedure.

    By document received at the Court Registry on 10 June 1996, the Commission raised a procedural issue, in which it asked the Court to rule that the application for annulment should not proceed to judgment, declare the claim for damages inadmissible or, in the alternative, dismiss it as unfounded, and order the applicant and Kolprojekt to pay the costs of the claim for damages.

    By order of 13 June 1997 in Case T-13/96 TEAM and Kolprojekt v Commission [1997] ECR II-983, the Court of First Instance (Fourth Chamber) ruled that there was no longer any need to give a decision on the application for annulment, reserved for the final judgment its decision on the application for a declaration that the claim for damages was inadmissible and reserved the costs.

    By order of 8 May 1998 in Case T-13/96 TEAM and Kolprojekt v Commission (not published in the European Court Reports), the President of the Fourth Chamber of the Court of First Instance, having been informed by the applicants in the reply that Kolprojekt wished to withdraw from the present proceedings, ordered the latter's name to be removed from the Court register.

    Admissibility

    Arguments of the parties

    The Commission maintains that the claim for damages is inadmissible, since it does not comply with Article 44 of the Court's Rules of Procedure and consequently violates the rights of the defence. An action for damages is admissible only if it is complete and thus enables the defendant to prepare a proper defence.

    According to Article 19 of the EC Statute of the Court of Justice, which is applicable to proceedings before the Court of First Instance and Article 44(1)(c) of the Rules of Procedure of the Court of First Instance,

    an application must, inter alia, specify the subject-matter of the dispute and contain a brief statement of the grounds on which the application is based. In order to fulfil those requirements, an application seeking compensation for damage allegedly caused by a Community institution must state the evidence from which the conduct alleged by the applicant against the institution may be identified, the reasons for which the applicant considers there to be a causal link between the conduct and the damage which he claims to have suffered and the nature and extent of that damage.

    Although the applicant has not quantified the damage which it claims to have suffered, it has clearly indicated the evidence on the basis of which its nature and extent can be assessed, and the Commission has therefore been able to prepare its defence. In those circumstances, the absence of figures in an application cannot affect the Commission's rights of defence, provided that the applicant has produced those figures in its reply, thereby enabling the defendant to discuss them in its rejoinder and at the hearing, as was the position in the present case.

    It follows that the claim for damages is admissible.

    The effect on the claim for damages of the order of 13 June 1997 in TEAM and Kolprojekt v Commission ruling that there was no need to give a decision on the application for annulment

    Substance

    Arguments of the parties

    The applicant maintains that, having issued an invitation to tender and ensured that the tendering procedure followed its normal course almost until its completion, the Commission changed its mind without warning and adopted measures wholly lacking in any objective justification or consistency. That conduct on the part of the Commission constitutes a misuse of powers and a breach of the principle of sound administration.

    Although the Commission is empowered to annul a procedure which is objectively incapable of detemining the most advantagwous tender with a view to awarding the contract, its annulment of a procedure which fully enables the identity of the tenderer to whom the contract should most appropriately be awarded to be ascertained is contrary to the public interest and to the rights and interests of the individual undertakings submitting tenders.

    In the present case, there was no objective reason justifying the termination of the procedure in respect of the invitation to tender of 13 June 1995 and the commencement of a new procedure.

    The applicant asserts that the damage suffered by it consists of three elements, namely, the loss sustained (damnum emergens), loss of profit (lucrum cessans) and harm to its image.

    As regards the existence of a causal link, the applicant maintains that its chances of winning the contract, the prospect of which prompted it to incur the expenses involved in participating in the tendering procedure, were completely reduced to zero as a result of the Commission's irregular conduct, so that those expenses have become a totally unjustified pecuniary loss.

    The Commission considers that there is no need, in view of its arguments concerning the alleged damage and the existence of a causal link, to examine the merits of the allegation that it acted unlawfully, particularly since the annulment of the entire procedure for lack of financing renders all further analysis superfluous. It rejects the allegations in question and denies having acted unlawfully in any way, observing, moreover, that no evidence has been adduced in support of the claim for damages.

    Findings of the Court

    It is settled case-law that, in order for the Community to incur non-contractual liability, a number of conditions must be satisfied concerning the illegality of the conduct alleged against the Community institutions, the fact of the damage and the existence of a causal link between that conduct and the damage complained of (Sonito and Others v Commission). Moreover, the damage must be a sufficiently direct consequence of the conduct complained of (Perillo v Commission).

    As regards the damage resulting from the loss sustained, namely the charges and expenses incurred by the applicant in connection with its participation in the tendering procedure, it should be noted, first, that under Article 23(1) of the General Regulations, the contracting authority may, prior to awarding the contract, without thereby incurring any liability to the tenderers, and regardless of the stage reached in the procedures leading to the conclusion of the contract, either decide to close or annul the tendering procedure in accordance with paragraph 2, or order that the procedure be recommenced, if necessary, on amended terms. It follows from the use of the adverbial phrase 'in particular' in Article 23(2) of the General Regulations that the list contained in that provision is not exhaustive.

    However, the provision in question cannot, without potentially undermining the principles of legal certainty and of protection of legitimate expectations, apply in cases where an infringement of Community law in the conduct of the tendering procedure has affected a tenderer's chances of being awarded the contract.

    In the present case, even if the applicant had shown, which it has not, that the Commission had infringed Community law in its conduct of the tendering procedure, such an infringement would not have compromised the consortium's chances of being awarded the contract. It was the withdrawal from the PHARE PL 9406 programme of the study for which the two invitations to tender concerned were issued, and the acceptance of that withdrawal by the Commission pursuant to Article 3(2) of Regulation No 3906/89, which terminated the tendering procedure. The applicant has not shown that the withdrawal in question was contrary to Community law.

    Nor has the applicant shown that that withdrawal was caused by the conduct alleged against the Commission.

    It follows that the applicant has not established the existence of a causal link between unlawful conduct on the part of the Commission and the damage resulting from the loss sustained.

    As to the damage resulting from the loss of profit, it is sufficient to note that the claim in that connection presupposes that the applicant was entitled to be awarded the contract. It must be observed in that regard that, even if the evaluation committee had recommended acceptance of the consortium's bid, the applicant could not have been certain of securing the contract. It follows that the damage at issue was not real and existing, but future and hypothetical.

    As regards the harm to its image, even if that image was tarnished, which has not been proved, the applicant has not succeeded in establishing a causal link between unlawful conduct on the part of the Commission and the damage allegedly resulting from it.

    In those circumstances, the claim for damages must be dismissed as unfounded.

    The Court:

    '0.1.  Dismisses the action;

    0.2.  Orders the applicant to pay all the costs relating to the claim for damages;

  • 0.3.  Orders the parties to bear their own costs relating to the application for annulment.'

    2.

    OPINIONS

    Case C-342/97

    Lloyd Schuhfabrik Meyer & Co. GmbH v Klijsen Handel B.V.

    Preliminary ruling · Landgericht München I · Interpretation of Article 5(1)(b) of the First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks (OJ 1989 L 40, p. 1) · Likelihood of confusion of monosyllabic words consisting of identical or similar phonetic elements arranged in the same order · Concept of recognition of a mark

    Advocate General F.G. Jacobs delivered his Opinion at the sitting of the Full Court on 29 October 1998.

    He was of the opinion that the questions referred should be answered as follows:

  • (1) In assessing the likelihood of confusion, for the purposes of Article 4(1)(b) of Council Directive 89/104/EEC, between a mark and a sign used for identical goods, the national court must consider whether there is a genuine and properly substantiated likelihood of confusion for an average consumer of the particular type of goods in the Member State concerned. In making that assessment it must make a global assessment of all relevant factors, in particular the degree of aural, visual or conceptual similarity between the mark and the sign and the distinctiveness which the mark has either per se or by virtue of the degree of recognition of the mark.
  • (2) The concept of the likelihood of association, as referred to in Article 4(1)(b), is not an alternative to that of likelihood of confusion but serves to define its scope.
  • (3) The Directive does not lay down a threshold above which a mark automatically acquires, by virtue of its degree of recognition, a particularly distinctive character and enjoys greater protection. The degree of recognition of a mark is one factor to be taken into account in the overall assessment of confusion. The greater the degree of recognition of the mark, the greater the likelihood of confusion with a similar sign.
  • (4) The fact that a mark has no descriptive elements may be a factor in assessing the distinctiveness of a mark but does not itself increase the likelihood of confusion.

    Joined Cases C-395/96 P and C-396/96 P

    Compagnie Maritime Belge SA and Dafra-Lines A/S v Commission of the European Communities

    Appeal against the judgment of the Court of First Instance of 8 October 1996 in Joined Cases T-24/93, T-25/93, T-26/93 and T-28/93 Compagnie Maritime Belge Transports and Others v Commission · Refusal to

    n 93/82

    Cewal, Cowac and Ukwal) and Art. 86 (IV/32.448 and IV/32.450: Cewal) of the EC Treaty

    Advocate General N. Fennelly delivered his Opinion at the sitting of the Fifth Chamber on 29 October 1998.

    He recommended that the Court:

  • · set aside the judgment of the Court of First Instance in so far as it upheld the fines imposed on the appellants as well as the accompanying rate of default interest;

    n 93/82

    proceeding pursuant to Articles 85 (IV/32.448 and IV/32.450: Cewal, Cowac and Ukwal) and 86 (IV/32.448 and IV/32.450: Cewal) of the EEC Treaty in so far as those Articles concern the appellants;

    For the rest, he recommended that the Court:

    · dismiss the appeals in their entirety;

  • · order the appellants to pay the costs of the respondent and of Grimaldi and Cobelfret, the intervener.

    Case C-366/97

    Massimo Romanelli and Paolo Romanelli

    Preliminary ruling · Tribunale (Civile e Penale), Firenze · Interpretation of Art. 2 of Council Directive 89/646/EEC: Second Council Directive of 15 December 1989 on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions and amending Directive 77/780/EEC · Meaning of 'repayable funds'

    Advocate General N. Fennelly delivered his Opinion at the sitting of the Sixth Chamber on 29 October 1998.

    He recommend that the Court reply as follows:

    Article 3 of the Second Council Directive 89/646/EEC of 15 December 1989 on the coordination of the laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions and amending Directive 77/780/EEC should be interpreted as prohibiting all persons or undertakings other than credit institutions from carrying on the business of taking deposits or other repayable funds from the public even where the obligation to repay arises not from the intrinsic characteristic of repayability of the instruments used but from a contractual agreement.

    3.

    NEW CASES

    Court of Justice

    Case C-344/98

    Masterfoods Ltd and HB Ice Cream Ltd

    HB Ice Cream Ltd and Masterfoods Ltd, acting under the commercial name 'Mars Ireland'

    Preliminary ruling · Supreme Court · Application of a Commission decision relating to a procedure under Article 85 of the EC TREaty · Obligations of the national courts where such a decision is the subject of an action before the Court of First Instance · Decision prohibiting the supply to retailers of freezer cabinets for the exclusive sale of ices manufactured by the supplier of those cabinets

    Case C-345/98

    Commission v Ireland

    Failure of a Member State to fulfil its obligations · Failure to transpose within the prescribed period Directive 94/9/EC of the European Council and the Parliament of 23 March 1994 on the approximation of the laws of the Member States concerning equipment and protective systems intended for use in potentially explosive atmospheres

    Case C-346/98

    Commission v Ireland

    Failure of a Member State to fulfil its obligations · Failure to transpose within the prescribed period Directive 94/60/EC of the European Parliament and the Council of 20 December 1994 amending for the fourteenth time Directive 76/769/EEC on the approximation of the laws, regulations and administrative provisions of the Member States relating to restrictions on the marketing and use of certain dangerous substances and preparations

    Case C-347/98

    Commission v Belgium

    Failure by a State to comply with its obligations · Infringement of Article 13(2)(f) of Regulation No 1408/71 · National rule providing for personal contributions to be levied on Belgian occupational sickness pensions payable to persons who no longer reside in belgium and are no longer subject to the Belgian social security system.

    Case C-348/98

    Vitor Manuel Mendes Ferreira and Maria Clara Delgado Correia Ferreira v Companhia de Seguros Mundial Confiança SA

    Preliminary ruling · Tribunal da Comarca de Setúbal · Interpretation of the Second Council Directive (85/4/EEC) of 30 December 1983 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles (OJ 1984 L 8, p. 17) and of the Third Council Directive (90/232/EEC) of 14 May 1990 on the approximation of the laws of the Member States relating to insurance against civil liability in respect of the use of motor vehicles · Strict liability towards a family member carried free of charge · Whether included · Effects of Directive 84/5/EEC when not properly transposed · Harmonious interpretation of national legislation having regard to the - unrealised - intention of the national legislature · Interpretation in conformity with Directive 90/232/EEC of

    legislation not yet appropriately amended, in relation to a situation arising before the end of the period allowed for transposition

    Case C-349/98

    Commission v Italy

    Failure by a Member State to fulfil its obligations · Failure to transpose within the prescribed period Council Directive 95/18/EC of 19 June 1995 on the licensing of railway undertakings and Council Directive 95/19/EC of 19 June 1995 on the allocation of railway infrastructure capacity and the charging of infrastructure fees

    Case C-350/98

    Henkel Hellas AVEE and Elliniko Dimosio (Etat hellénique)

    Interpretation of Article 4 of Council Directive 69/335/EEC of 17 July 1969 concerning indirect taxes on the raising of capital - national legislation imposing capital duty higher than that laid down by the directive - special fiscal situation in Greece.

    Case C-351/98

    Spain v Commission

    Annulment of Decision C(1998)2048 final concerning the Spanish system of aid (Plan Renove Industrial) for the purchase of industrial vehicles (April 1994 to December 1996)

    Case C-352/98 P

    Laboratoires pharmaceutiques Bergaderm SA and Jean-Jacques Goupil v Commission

    Appeal against the judgment of 16 July 1998 in Case T-199/96 in which the Court of First Instance dismissed an application for compensation for damage which the applicants purportedly suffered as a result of an investigation conducted by the Commission, pursuant to the 18th Commission Directive 95/34/CE of 10 July 1995 adapting to technical progress Annexes II, III, VI and VII to Council Directive 76/768/EEC on the approximation of the laws of the Member States relating to cosmetic products, into the use of psoralens in sun creams and bronzing products

    Case C-353/98

    Commission v France

    Failure by a State to comply with its obligations · Failure to transpose within the prescribed time-limit Council Directive 95/18/EC on the licensing of railway undertakings and Council Directive 95/19/EC the allocation of railway infrastructure capacity and the charging of infrastructure fees.

    Case C-354/98

    Commission v France

    Failure by a State to comply with its obligations · Failure to transpose within the prescribed time-limits Council Directive 96/97/EC on the implementation of the principle of equal treatment for men and women in occupational social security schemes.

    Case C-355/98

    Commission v Belgium

    Failure of a Member State to fulfi its obligations · Articles 52, 59 and 48 of the EC Treaty · Rules governing security firms · Undertakings required to have a place of business in Belgium · Staff requyired to be domiciled or habitually resident in Belgium · Undertakings established in another Member State required to obtain prior authorisation for the purpose of which no account is taken of the evidence and guarantees already presented in the Member State of establishment

    Case C-356/98

    Arben Kaba and Secretary of State for the Home Department

    Reference for a preliminary ruling · Immigration Adjudicator · Interpretation of Article 7(2) of Council Regulation No 1612/68 of 15 October 1968 on freedom of movement for workers within the Community (OJ, English Special Edition 1968 (II), p. 475) · Definition of social advantage · Application for permanent right to remain · Whether included · Right to remain for the spouse, from a non-member country, of a Community national · Conditions for granting it · Period of residence required · Length of period

    Case C-357/98

    The Queen, ex parte: Nana Yaa Konadu Yiadom and Secretary of State for the Home Department

    Preliminary ruling · Court of Appeal · Interpretation of Articles 8 and 9 of Council Directive 64/221/EEC of 25 February 1964 on the coordination of special measures to concerning the movement and residence of foreign nationals which are justified on grounds of public policy, public security or public health · Application to decisions concerning entry into the territory of a Member State · Person having acquired Netherlands nationality refused entry into United Kingdom · Refusal for reasons of public policy · Right of appeal which can be exercised only when the person concerned is no longer present in the territory of the Member State concerned

    Case C-358/98

    Commission v Italy

    Failure of a Member State to fulfil its obligations · Article 59 of the EC Treaty · Cleansing, disinfection, disinfestation, rodent-control and sanitation services · National legislation requiring undertakings to be registered · Legislation laying down penal sanctions in the event of failure to comply with that condition and providing that contracts concluded by non-registered companies are void.

    Case C-359/98 P

    Ca'Pasta Srl and Commission

    Appeal against the order made on 16 July 1988 by the Third Chamber of the Court of First Instance of the European Communities in Case T-274/97 between Caw' Pasta Srl and Commission · Order dismissing as inadmissible an action for the annulment of Council Regulation (EEC) No 4028/86 of 18 December 1986 on Community measures to improve and adapt structures in the fisheries and aquaculture sector.

    Case C-360/98

    Bernard Bauduin and Laurent Blondeau

    and SA Renault

    Preliminary ruling · Conseil de Prud'hommes, Bobigny · Interpretation of Article 119 of the EC Treaty 'and of Community law' as regards a collective agreement providing for a maternity grant paid exclusively to female workers taking maternity leave (with maintenance of their salary)

    Court of First Instance

    Case T-160/98

    Leon Van Parijs NV and Pacific Fruit Company NV v Commission

    Annulment of the decision of the Commission taken between 12 March 1998 and 5 August 1998 reducing the applicants' reference quantity for the importation of bananas.

    Case T-162/98

    South Wales Small Mines Association v Commission

    Annulment of the Commission decision of 30 July 1998 (Case IV/E-3/SWSMA) rejecting the complaint lodged by the applicant against the Central Electricity Generating Board (CEGB) and its successors National Power and PowerGen, relating to an alleged agreement, decision or concerted practice concerning the price of coal for generating electricity

    Case T-163/98

    Procter & Gamble Company v OHMI

    Community trade mark · Annulment of decision R35/1998-1 of the First Board of Appeal of the Office for Harmonisation in the Internal Market (OHIM) of 31 July 1998, dismissing the appeal against the decision of the examiner refusing to register the verbal trade mark BABY-DRY for nappies

    Case T-164/98

    Giuseppe Carraro v Commission

    Staff case

    Case T-165/98

    Grandi Molini SpA v Commission

    Application, in the first place, for annulment of the Commission decision of 24 September 1998 fixing the minimum price for the sale of barley within the context of the standing invitation to tender opened by Commission Regulation (EC) No 1666/98 of 28 July 1998 for the export of barley held by the Austrian intervention agency (OJ 1998 L 211 of 29 July 1998, p. 12), and, second, for compensation for the damage which the applicant company allegedly incurred by reason of that decision · Assumption by the Community of the costs of transport to the port of exportation · Concept of the most favourable bid · Risk that trade may be diverted and competition distorted.

    Case T-166/98

    Cantina Sociale di Dolianova and Others v Commission

    First, annulment of Commission decision VI B-I-3 M 4/97PVP of 31 July 1998, rejecting the claim by the applicants for payment of aid for distillation in the 1982/83 marketing year and, secondly, the Commission to be ordered to pay a certain amount to the applicant by way of compensation for damage allegedly suffered as a result of the contested decision

    Case T-167/98

    Luc Verheyden v Commission

    Staff case

    Case T-168/98

    Anastasios Bisopoulos v Commission

    Staff case

    Case T-169/98

    Schiocchet SARL v Commission

    Annulment of the Commission's decision of 19 August 1998 dismissing the applicant's complaint of 4 December 1996, concerning an alleged contravention of the Community rules for the international carriage of passengers by coach and bus · Declaration that Article 4(2) of Council Regulation No 684/92/EEC of 16 March 1992 is unlawful

    Case T-170/98

    Schiocchet SARL v Commission

    Annulment of the Commission's decision of 19 August 1998 dismissing the applicant's complaint of 5 December 1996, concerning an alleged contravention of the Community rules for the international carriage of passengers by coach and bus · Declaration that Article 4(2) of Council Regulation No 684/92/EEC of 16 March 1992 is unlawful

    Case T-171/98

    Maria Adelina Biasutto v Council

    Staff case

    This bulletin is issued by the Court's Press and Information Division (L-2925 Luxembourg) to provide rapid information on the work of the Court. However, it is only the text of the judgments and opinions published in the European Court Reports that is authentic. This information may be reproduced provided the source is acknowledged.

    Original version: French

    Completed on 13 November 1998

    Catalogue No: DX-AC-98-0026-EN-C


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