C-205/06 Commission v Austria and C-249/06 Commission v Sweden, judgments of 3 March 2009

The Court of Justice condemns two Member States for maintaining in force international agreements which are incompatible with Community law, entered into prior to their accession to the European Union.

Prior to their accession to the European Union, Austria and Sweden had entered into bilateral investment agreements with several third countries. These agreements contained a clause guaranteeing to the investors of the States concerned the free transfer, in freely convertible currency, of payments connected with an investment, without undue delay.

In the Commission’s view, these agreements could impede the application of certain provisions of the EC Treaty relating to restrictions on movements of capital between Member States and third countries. According to the second paragraph of Article 307 EC, Austria and Sweden had to take all appropriate steps to eliminate these incompatibilities with Community law. Since no action was taken, the Commission brought proceedings against these two Member States before the Court of Justice for failure to fulfil their obligations. The Court firstly declares that several provisions of the EC Treaty – and more specifically Articles 57(2), 59 and 60(1) – confer on the Council the power to restrict, in certain specific circumstances, movements of capital and payments between Member States and third countries. In order to ensure the effectiveness of these provisions, the Council measures restricting the free movement of capital must be capable of being applied immediately, including with regard to the States with which Austria and Sweden are bound by the agreements in question.

The Court points out in this respect that these agreements contain no provision which would allow compliance with the obligations under the EC Treaty to be ensured.

Furthermore, this result could not be achieved either by any international-law mechanism. In particular, the possibilities offered by international law for renegotiation of the agreements at issue or their suspension or denunciation are too uncertain to guarantee the effectiveness of any measures adopted by the Council under the aforementioned provisions of the EC Treaty.

The Court concludes from this that an incompatibility does exist between these

agreements and Community law. Consequently, it declares that Austria and Sweden have in fact breached the second paragraph of Article 307 EC.


source: http://ec.europa.eu/dgs/legal_service/arrets/06c205_en.pdf

C-127/07 Société Arcelor Atlantique et Lorraine and Others v Premier ministre, Ministre de l’Écologie et du Développement durable, Ministre de l’Économie, des Finances et de l’Industrie, judgment of 16 December 2008

The Court confirmed the validity of the directive on the scheme for greenhouse
gas emission allowance trading with regard to the principle of equal treatment
Directive 2003/87/EC establishes a scheme for greenhouse gas emission allowance
trading within the Community with the aim of contributing to compliance with the overall
commitment entered into under the Kyoto Protocol to reduce overall emissions of six
greenhouse gases by 8% as compared with the emission levels recorded in 1990.
Arcelor brought an action before the Conseil d'État [Council of State] for the annulment
of the Decree of 15 April 2004 which transposes that directive in France. The applicant
relied, inter alia, on the infringement of the constitutional principle of equal treatment,
since the Directive provides for a difference in treatment between installations in the
steel sector, which are subject to the allowance trading scheme, and the aluminium and
plastic industries, which, even though they also emit greenhouse gases, are not subject
to that scheme. The Conseil d'État asked the Court of Justice whether the Community
legislature breached the principle of equal treatment by applying unjustifiable different
treatment to comparable situations.
The Court pointed out first of all that the general principle of equal treatment requires
that comparable situations must not be treated differently and different situations must
not be treated in the same way unless such treatment is objectively justified. It held
that the steel, chemical and non-ferrous metal sectors are in fact in a comparable
situation as far as the objective of the directive in question is concerned, even though
they are treated differently.
The Court then considered whether the difference in treatment between these sectors
introduced by the directive at issue can be justified by objective reasons. In this regard,
the Court recalled that the Community legislature has a broad discretion where its action
involves political, economic and social choices and where it is called on to undertake
complex assessments and evaluations. However, it remains obliged to base its choice on
objective criteria appropriate to the aim pursued by the legislation in question.
In this case, the Court took the view, first, that the allowance trading scheme introduced
by Directive 2003/87/EC is a novel and complex scheme whose implementation and
functioning could have been disturbed by the involvement of too great a number of
participants and, second, that the original definition of the scope of the directive was
dictated by the objective of attaining a critical mass of emissions covered by the
scheme.
In this context, the exclusion of the chemical sector, which has a number of particularly
significant installations, from the scope of the Directive can be justified by reason of the
desire to avoid making the allowance trading scheme more difficult and increasing the
administrative burden, and thus to ensure that its functioning is not disturbed. Similarly,
the exclusion of the non-ferrous metal sector is permissible in view of the difference in
its level of emissions as compared with the other sectors covered.
The Court concluded that the Community legislature did not infringe the principle of
equal treatment by excluding the chemical and non-ferrous metal sectors from the
scope of Directive 2003/87/EC.

Source: http://ec.europa.eu/dgs/legal_service/arrets/07c127_en.pdf 

T-257/04 Poland v Commission, judgment of 10 June 2009

In November 2003, on the basis of the 2003 Treaty of Accession, the Commission
adopted Regulation (EC) No 1972/2003, which introduced, inter alia, by way of
transitional derogation from the Community rules which would otherwise be applicable,
a system of charges on holders of surplus stocks of certain agricultural products which
appear in the list contained in that regulation. In April 2004 the Commission adopted
Regulation (EC) No 735/2004, under which seven agricultural products were added to
that list.
Poland brought an action before the Court of First Instance for the annulment of
Regulation (EC) No 1972/2003, as amended by Regulation (EC) No 735/2004.
In so far as it concerns Regulation (EC) No 1972/2003, the action was brought after the
expiry of the time-limit of two months laid down by the fifth paragraph of Article 230 EC.
Consequently, the Court of First Instance considers that the action is inadmissible as
regards the agricultural products contained in the initial version of the list which appears
in that regulation.
The Court of First Instance rejected the various arguments submitted by Poland,
according to which the time-limit for bringing an action started to run only at the time of
its accession. As regards the argument that Regulation (EC) No 1972/2003 was not
published in the 20 official languages, the Court of First Instance found that the
Commission was not required to publish that regulation in Polish in November 2003.
Concerning the fact that the regulation at issue entered into force only subject to, and
on the date of, the entry into force of the Treaty of Accession, that is to say, on 1 May
2004, the Court of First Instance held that that does not affect the start of the timelimit
for bringing an action, which is defined not by the date of the entry into force of the
contested measure but by the date of its challengeability, namely the completion of all
the requisite formalities as to publicity. Lastly, the Court observed that the Community rules concerning procedural time-limits have to be strictly applied and that they may not be derogated from save where the circumstances are quite exceptional, which Poland has not demonstrated.
The Court of First Instance noted that the right to effective judicial protection has not
been infringed. Prior to its accession, a new Member State may, like any non-member
state and any sub-state body, contest the legality of a Community act within the
time-limit laid down in its capacity as a legal person if it is directly and individually
concerned by that measure. The Court of First Instance refered to its settled case-law
that a measure of general application such as a regulation can be of individual concern
to natural or legal persons only if it affects them by reason of certain attributes peculiar
to them or by reason of the factual situation which differentiates them from all other
persons. That was true of Regulation (EC) No 1972/2003 when it imposed various obligations on Poland. By contrast, the Court of First Instance considered the action admissible in so far as it
also concerns the seven agricultural products which Regulation (EC) No 735/2004 added
to the list appearing in Regulation (EC) No 1972/2003, given that the time-limit for
bringing an action to contest Regulation (EC) No 735/2004 had not yet expired when the
application was lodged. It observes that, where a provision in a regulation is amended, a
fresh right of action arises, not only against that provision alone, but also against all the
provisions which, even if not amended, form a whole with it. In addition, the Court of First Instance dismissesd the action on the substance.

Source: http://ec.europa.eu/dgs/legal_service/arrets/04t257_en.pdf