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( Action for damages – Non-contractual liability of the European Union – Person to whom the Staff Regulations apply – Inadmissibility )
In Case T‑182/24,
DR,
DS,
represented by N. Flandin, lawyer,
applicants,
European Insurance and Occupational Pensions Authority (EIOPA), represented by A. Terstegen-Verhaag and C. Coucke, acting as Agents, and by B. Wägenbaur, lawyer,
defendant,
composed of O. Porchia, President, M. Jaeger (Rapporteur) and S. Verschuur, Judges,
Registrar: V. Di Bucci,
having regard to the written part of the procedure,
makes the following
By their action under Article 268 and the second paragraph of Article 340 TFEU, the applicants, DR and his spouse, DS, seek compensation for the non-material damage which they claim to have suffered as a result of the unlawful conduct of the European Insurance and Occupational Pensions Authority (EIOPA).
On 1 August 2017, in view of possibly being recruited to the EIOPA, DR completed a declaration of conflict of interest, in which he stated that:
–he was the owner and managing director of A, which held 100% of the capital of B and C;
–C was inactive and was due to merge with B;
–A and B (together, ‘the companies at issue’) provided consultancy services to, inter alia, insurance companies and pension funds which were subject to supervision by the competent national authorities supervised by the EIOPA.
By email of 7 August 2017, DR informed the EIOPA that he was considering ceasing the consultancy services which he provided, directly or through the companies at issue, to various companies.
By email of 23 August 2017, the EIOPA confirmed to DR that it had not identified any conflicts of interest and sent him a proposal for an employment contract.
On 16 September 2017, DR was recruited to the Oversight Department of the EIOPA, as a grade AD 7 member of staff, for a period of three years.
On 26 June 2018, in a new declaration of conflict of interest sent to the EIOPA, DR stated, in addition to the information already contained in his declaration of 1 August 2017, that C had merged with B.
By email of 20 July 2018, the EIOPA asked DR to confirm that the companies at issue were no longer active in the financial sector.
By email of 6 August 2018, DR informed the EIOPA that the companies at issue were no longer active in the insurance sector.
On 7 December 2018, the EIOPA opened an ethics review procedure against DR to check the content of the two declarations of conflict of interest which he had submitted in 2017 and 2018 (‘the ethics review’). In that procedure, the Ethics Officer of the EIOPA (‘the Ethics Officer’) asked DR:
–to provide information regarding the activities carried out in 2017 and 2018 by the companies at issue in the pensions sector and, more broadly, in the financial sector;
–to confirm that, as stated in his email of 7 August 2017, he had ceased the consultancy services which he provided directly or through the companies at issue;
–to provide him with information concerning the ownership of the companies at issue, their activities and the income they received in 2017 and 2018.
By email of 7 December 2018, DR informed the EIOPA that, in 2018, the companies at issue did not engage in any financial activities or commercial relationships. In addition, he confirmed that the information regarding the cessation of his own consultancy services referred to in his email of 7 August 2017 was accurate and complete.
By email of 4 January 2019, the Ethics Officer asked DR to provide him with a statement prepared by an external accountant showing all the income he had received in 2018 and stemming from the activities of the companies at issue.
By email of 14 January 2019, DR sent to the EIOPA information concerning the companies at issue, pointing out the confidential nature of the data transmitted and specifying that they could not be disclosed to anyone else within the EIOPA without his prior consent.
In his report of 28 January 2019, the external accountant stated that he had noted 10 sources of income in a bank account belonging to DR, which included the salary paid by the EIOPA.
By email of 18 February 2019, the Ethics Officer reiterated to DR his request seeking to obtain a statement prepared by an external accountant showing, specifically for 2018, all his income from the companies at issue. In addition, he asked him to provide the accounting documents of the companies at issue covering the period following his entry into service at the EIOPA.
By email of 10 March 2019, DR sent to the EIOPA the requested information, pointing out the confidential nature of the data transmitted and specifying that they could not be disclosed to anyone else within the EIOPA without his prior consent.
On 4 April 2019, the Ethics Officer sent to the EIOPA his screening report, in which he stated that DR was in a situation of conflict of interest, since, first, he had received undeclared external income in 2018 which exceeded the authorised amount and, secondly, the companies at issue were still active in the insurance sector.
On 7 May 2019, the Executive Director of the EIOPA transferred DR from the Oversight Department to another department.
On 17 May 2019, DR sent to the EIOPA his comments on the screening report drawn up by the Ethics Officer.
On 22 July 2019, the Executive Director of the EIOPA opened an administrative investigation in respect of DR to establish the nature of his outside activities (‘the administrative investigation’).
On 30 September 2019, the external investigator in charge of the administrative investigation (‘the external investigator’) delivered her report, in which she stated that, since (i) DR was still employed by the companies at issue, (ii) those companies carried out activities in the insurance sector and (iii) the income he had received from his outside activities in 2018 had exceeded the authorised amount, he was in a situation of conflict of interest vis-à-vis the EIOPA.
By decision of 17 December 2019, DR was dismissed from the EIOPA (‘the dismissal decision’).
On 13 January 2020, DR filed a first complaint with the European Ombudsman alleging that the dismissal decision was unlawful. That complaint was rejected by the Ombudsman as inadmissible, on the ground that DR had not completed all the internal appeal stages.
On 3 February 2020, DR lodged a complaint with the EIOPA against the dismissal decision (‘the complaint concerning the dismissal decision’). In that complaint, he essentially, inter alia:
–disputed the legality of his transfer to another department of the EIOPA and of the dismissal decision;
–claimed that the EIOPA had made various irregularities when processing his personal data;
–claimed that he had been subject to harassment by the EIOPA;
–sought payment of financial compensation for the damage he had suffered.
By decision of 2 June 2020, the EIOPA rejected the complaint concerning the dismissal decision.
On 16 September 2020, DR filed a second complaint with the Ombudsman.
On 30 September 2020, DR brought an action before the European Data Protection Supervisor (EDPS) claiming that the EIOPA had unlawfully processed his personal data, those of DS and those of the companies at issue.
By decision of 11 December 2020, the Ombudsman rejected the applicant’s second complaint because she did not have sufficient grounds to open an investigation.
On 1 December 2021, DR lodged a third complaint with the Ombudsman.
By decision of 9 September 2022, the EDPS found that the EIOPA had infringed Article 4(1)(a) and Article 15(1)(c) of Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ 2018 L 295, p. 39), in so far as, during the administrative investigation, it had failed properly to inform DR of the legal basis for the processing of his personal data. The EDPS therefore decided to reprimand the EIOPA pursuant to Article 58(2)(b) of that regulation.
By decision of 25 May 2023, following DR’s third complaint, the Ombudsman found that, when recruiting him, the EIOPA had failed diligently to manage the issue of his conflicts of interest, which had given rise to an instance of maladministration. In addition, the Ombudsman noted that the EIOPA had not conducted the ethics review and the administrative investigation carefully and rigorously.
On 4 April 2024, the applicants brought the present action.
The applicants claim that the Court should:
–order the EIOPA to pay compensation for the non-material damage they have suffered
–order the EIOPA to pay the costs.
By separate document lodged at the Registry of the General Court on 2 July 2024, the EIOPA submitted a plea of inadmissibility pursuant to Article 130(1) of the Rules of Procedure of the General Court, in which it contended that the Court should:
–dismiss the action as inadmissible;
–order the applicants to pay the costs.
On 28 August 2024, the applicants filed their observations on the plea of inadmissibility submitted by the EIOPA, in which they claimed that the Court should:
–declare the action admissible and well founded;
–order the EIOPA to pay compensation for the non-material damage they have suffered;
–order the EIOPA to pay the costs.
Under Article 130(1) and (7) of the Rules of Procedure, if the defendant so requests, the Court may rule on inadmissibility without going to the substance of the case. In the present case, since the EIOPA requested a ruling on the inadmissibility of the action, the Court, considering that it has sufficient information from the material in the file, has decided to rule on that application without taking further steps in the proceedings.
In its plea of inadmissibility, the EIOPA argues that the action is inadmissible given that, since that action has its origin in the employment contract between DR and the EIOPA, the applicants are not entitled to bring proceedings on the basis of non-contractual liability pursuant to the second paragraph of Article 340 TFEU.
The applicants maintain that the action is admissible.
It should be noted that it is apparent from pages 1 and 36 of the application that the present action for compensation is based on Article 268 and the second paragraph of Article 340 TFEU.
Under Article 270 TFEU, as implemented by Article 91(1) of the Staff Regulations of Officials of the European Union (‘the Staff Regulations’), the Court of Justice of the European Union has jurisdiction to rule on any dispute between the European Union and any person to whom those regulations apply.
Article 270 TFEU thus creates a means of legal redress for civil service disputes distinct from general remedies, such as actions for annulment governed by Article 263 TFEU or actions for damages governed by Article 268 TFEU and the second and third paragraphs of Article 340 TFEU. According to the case-law, it follows from the Staff Regulations that, unlike any other individual, an official or other member of staff of the European Union is connected to the institution or body to which he or she belongs by a legal employment relationship involving a balance of specific reciprocal rights and obligations, which is reflected by the institution’s duty to have regard for the welfare of the person concerned (see judgment of 6 July 2022, OC v EEAS, T‑681/20, not published, EU:T:2022:422, paragraph 65 and the case-law cited).
Furthermore, according to settled case-law, any dispute between an official or member of staff and the institution to which he or she belongs, even in the case of an action for compensation, falls within the scope of Article 270 TFEU, as implemented by Article 91(1) of the Staff Regulations, where the dispute has its origin in the employment relationship between that official or other servant and that institution (see judgments of 4 June 2020, Schokker v EASA, C‑310/19 P, not published, EU:C:2020:435, paragraph 50 and the case-law cited, and of 5 May 2022, Commission v Missir Mamachi di Lusignano, C‑54/20 P, EU:C:2022:349, paragraph 42 and the case-law cited).
Thus, with regard to an action for compensation brought by an official or a member of staff, the case-law considers that, where that action has its origin in the employment relationship between that official or member of staff and the institution in question, it cannot be based on the second paragraph of Article 340 TFEU but must be brought on the basis of Article 270 TFEU, failing which it will be inadmissible (see, to that effect, judgments of 17 February 1977, Reinarz v Commission and Council, 48/76, EU:C:1977:30, paragraphs 9 and 10; of 7 October 1987, Schina v Commission, 401/85, EU:C:1987:425, paragraph 9; and of 12 June 2002, Mellone v Commission, T‑187/01, EU:T:2002:155, paragraph 74).
Furthermore, it follows from the case-law that, where the dispute has its origin in the employment relationship between an official or member of staff and an institution of the European Union, not only that official or member of staff, but also any other person to whom the Staff Regulations apply, within the meaning of Article 91(1) of the Staff Regulations, may bring proceedings against an institution of the European Union, on the basis of Article 270 TFEU, to challenge the legality of an act adversely affecting him or her (see, to that effect, judgment of 5 May 2022, Commission v Missir Mamachi di Lusignano, C‑54/20 P, EU:C:2022:349, paragraph 46).
With a view to determining the persons other than an official or member of staff who may be regarded as persons ‘to whom the Staff Regulations apply’, it should be noted that, according to the case-law, the Staff Regulations and the Conditions of Employment of Other Servants of the European Union (‘the CEOS’) are intended to regulate the legal relations between the EU institutions and their officials or members of staff. In order to achieve that aim, the Staff Regulations not only establish a series of reciprocal rights and obligations between those institutions and their officials or members of staff but also confer rights and benefits on certain members of their families. The grant of such rights and benefits to those designated members of the official’s family constitutes recognition of the close family ties between those persons and the official or member of staff, and of the potential influence of those family ties on the conditions in which the official is required to carry out his or her work (see, to that effect, judgment of 5 May 2022, Commission v Missir Mamachi di Lusignano, C‑54/20 P, EU:C:2022:349, paragraphs 47, 48 and 51).
Thus, with regard to the spouse of an official, Articles 42b and 55a of the Staff Regulations allow him or her, in the event that he or she suffers from a serious illness or a severe disability, to receive the official’s support by giving that official the possibility of exercising his or her right to family leave or part-time work. The same provisions apply, by analogy, to the spouse of a member of staff under Article 16 of the CEOS. In addition, Article 70 of the Staff Regulations and Article 35 of the CEOS grant the surviving spouse, under certain conditions, the right to benefits in the event of the death of the official or member of staff.
It follows that the spouse of an official or member of staff is a person to whom the Staff Regulations apply, within the meaning of Article 91(1) of the Staff Regulations. Consequently, according to the case-law referred to in paragraphs 41 to 43 above, he or she may, in the same way as the official or member of staff of whom he or she is the spouse, bring an action for compensation against an institution of the European Union on the basis of Article 270 TFEU, where the dispute has its origin in the employment relationship between that official or member of staff and that institution.
In that regard, the case-law specifies that the right to bring proceedings of persons to whom the Staff Regulations apply on the basis of Article 270 TFEU is not subject to the requirement that those persons must actually have, in each particular case, the rights and benefits which are conferred on them by the Staff Regulations and by the CEOS. It is sufficient, indeed, that, as a result of their ties with that official or member of staff, those persons are referred to in the Staff Regulations (see, to that effect, judgments of 10 September 2015, Review Missir Mamachi di Lusignano v Commission, C‑417/14 RX-II, EU:C:2015:588, paragraph 35, and of 5 May 2022, Commission v Missir Mamachi di Lusignano, C‑54/20 P, EU:C:2022:349, paragraphs 52 and 55).
It follows, in essence, from the foregoing that, where an action for compensation brought by an official or a member of staff and by his or her spouse has its origin in the employment relationship between that official or member of staff and an institution of the European Union, that action falls within the scope of Article 270 TFEU, as implemented by Article 91(1) of the Staff Regulations – failing which it will be inadmissible – and cannot be based on the second paragraph of Article 340 TFEU.
It should be noted, in the present case, that:
–the action is based on Article 268 and the second paragraph of Article 340 TFEU;
–from 16 September 2017 to 17 December 2019, DR worked as a member of staff within the EIOPA;
–it follows from the parties’ written submissions that DS is DR’s spouse.
In those circumstances, in order to assess the admissibility of the present action in relation to both DR and DS, it is necessary to ascertain whether it has its origin in the employment relationship between DR and the EIOPA.
It should be noted that, in their action, the applicants claim that, during the ethics review and the administrative investigation, the EIOPA had access, through the Ethics Officer and the external investigator, to personal data concerning them. The applicants claim that, when processing that data, the EIOPA infringed several provisions of the Charter of Fundamental Rights of the European Union (‘the Charter’) and Regulation 2018/1725 and that those infringements caused them non-material damage for which they are seeking compensation.
More specifically, the applicants claim that the EIOPA:
–failed to ensure the lawful, fair and transparent processing of their personal data, in breach of Article 8 of the Charter, as well as Article 4(1)(a), Article 14 and Article 15(1)(c) and (d) of Regulation 2018/1725;
–breached the principle of data minimisation, provided for in Article 4(1)(c) of Regulation 2018/1725, since the data relating to DS’s tax returns and social security number and those relating to transactions carried out on DR’s personal accounts, which the EIOPA had requested him to send to it, were not necessary for the purpose of establishing clarity on DR’s outside activities or the origin of his income;
–failed to take all necessary measures to prevent the disclosure of the data they had sent to it, in breach of the principle of security of processing of personal data set out in Article 4(1)(f) and Article 33 of Regulation 2018/1725;
–infringed Article 23(1) of Regulation 2018/1725, since, first, it did not properly inform them of their right to object to the processing of their personal data and, secondly, it did not provide reasons why their data had been communicated to persons other than the Ethics Officer and the external investigator;
–breached the principle of good administration enshrined in Article 41 of the Charter, since it appointed an external investigator with whom it found itself in a situation of conflict of interest.
It follows that, by their action, the applicants seek, in essence, compensation for the damage they claim to have suffered as a result of the unlawful conduct of the EIOPA with regard to the processing of their personal data in the context of the ethics review and the administrative investigation.
It should be recalled that, in the context of the ethics review, the Ethics Officer asked, inter alia, DR to provide him with information concerning, first, his income and, secondly, the activities carried out and the income received by the companies at issue in 2017 and 2018.
It should also be borne in mind that the Ethics Officer stated in his report drawn up following the ethics review procedure that, since DR had received undeclared external income in 2018 which exceeded the authorised amount and the companies at issue were still operating in the insurance sector, DR was in a situation of conflict of interest vis-à-vis the EIOPA.
Furthermore, during the administrative investigation, the external investigator asked DR to send her additional information regarding his income and his relationship with the companies at issue. After checking the documents provided, she concluded that, since (i) DR was still employed by the companies at issue, (ii) those companies carried out activities in the insurance sector and (iii) the income he had received from his outside activities in 2018 had exceeded the authorised amount, he was in a situation of conflict of interest vis-à-vis the EIOPA.
Thus, based on the conclusions reached by the Ethics Officer and the external investigator, the Executive Director of the EIOPA adopted the dismissal decision on 17 December 2019.
It follows from the foregoing, first, that the applicants’ personal data, breach of which is alleged in the present case, were transmitted by DR to the EIOPA exclusively in the context of the ethics review and the administrative investigation which were carried out during his period of employment with the EIOPA.
Secondly, the purpose of the transmission of the applicants’ personal data to the EIOPA was to clarify the nature of DR’s outside activities and to check whether there was any conflict of interest which was incompatible with his work as a member of staff with the EIOPA.
Thirdly, the allegedly unlawful conduct of the EIOPA of which the applicants complain took place in the context of the ethics review and the administrative investigation.
Fourthly, following the reports of the Ethics Officer and the external investigator, which had identified a conflict of interest, the EIOPA decided to dismiss DR.
In this context, it must be found that the dispute has its origin in the employment relationship between DR and the EIOPA. It follows that, according to the case-law referred to in paragraphs 41 to 44 above, to the extent that it is based on the second paragraph of Article 340 TFEU, the present action must be regarded as inadmissible.
In any event, even if it were possible to consider that the action is based on Article 270 TFEU and if its subject matter were the same as that of the complaint concerning the dismissal decision, it would be appropriate to declare it inadmissible. Indeed, first, DR failed to observe the three-month time limit provided for in Article 91 of the Staff Regulations, which would have allowed him to bring an action for annulment against the EIOPA’s decision which rejected, on 2 June 2020, the complaint concerning the dismissal decision. Secondly, before bringing the present action, DS did not initiate a pre-litigation procedure with the EIOPA, in accordance with Articles 90 and 91 of the Staff Regulations. In addition, in the event that its subject matter were not to be confused with that of the complaint relating to the dismissal decision, it would also be appropriate to declare the action inadmissible, since the applicants did not initiate a pre-litigation procedure with the EIOPA, in accordance with Articles 90 and 91 of the Staff Regulations.
That finding cannot be called into question by the arguments put forward by the applicants in their observations on the plea of inadmissibility.
By their first argument, the applicants maintain that their action relates to compensation for the non-material damage they have suffered as a result of the unlawful conduct of the EIOPA in processing their personal data under Regulation 2018/1725 but does not concern the employment relationship between DR and the EIOPA. The applicants argue, in essence, that it follows from recital 6 and Articles 64 and 65 of Regulation 2018/1725 that, where the action for compensation concerns the processing of personal data, it can be based on the second paragraph of Article 340 TFEU.
In that regard, in the first place, it should be noted that, admittedly, the applicants seek compensation for the non-material damage which they claim to have suffered as a result of the unlawful conduct of the EIOPA, in infringement of Regulation 2018/1725 and Articles 8 and 41 of the Charter. However, that allegedly unlawful conduct, as regards the processing of the applicants’ personal data, has its origins in the employment relationship between DR and the EIOPA. As follows from paragraphs 58 to 62 above, the processing of those data (i) was carried out by the EIOPA as part of the ethics review procedure and the administrative investigation, (ii) was designed to check whether the outside activities pursued by DR were compatible with his work with the EIOPA and, (iii) since it had enabled a conflict of interest to be identified, led to the adoption of the dismissal decision.
In the second place, it should be noted that (i) recital 6 of Regulation 2018/1725 grants every person legal protection with regard to the processing of their personal data by the institutions and bodies of the European Union, (ii) Article 65 of Regulation 2018/1725 recognises the right of any person to receive compensation for damage suffered as a result of an infringement of that regulation and (iii) Article 64 of that regulation confers on the Court of Justice jurisdiction to hear all disputes relating to the provisions of that regulation. However, there is nothing in those provisions to suggest that, where the action for compensation brought by an official, a member of staff or the spouse of that official or member of staff against an EU institution concerns the processing of their personal data, it must be based on the second paragraph of Article 340 TFEU.
In that regard, it follows from the case-law referred to in paragraphs 41 to 44 above that civil service disputes based on Article 270 TFEU, as implemented by Article 91 of the Staff Regulations, including where they seek compensation for damage suffered by an official or other member of staff, are subject to rules that differ from those arising from the general principles governing the non-contractual liability of the European Union under the second paragraph of Article 340 TFEU.
Consequently, where an action for damages has its origin in the employment relationship between an official or member of staff and an institution, it falls within the scope of civil service disputes under Article 270 TFEU, even when it concerns the processing of personal data.
Moreover, the Court has already had the opportunity to rule, in the context of an action for compensation based on Article 270 TFEU, on the unlawfulness of the conduct of an institution concerning the protection of personal data (judgments of 12 September 2019, XI v Commission, T‑528/18, not published, EU:T:2019:594, and of 6 July 2022, OC v EEAS, T‑681/20, not published, EU:T:2022:422).
In the light of those considerations, it must be found that the applicants’ first argument cannot succeed.
By their second argument, the applicants claim that, in the judgments of 3 December 2015, CN v Parliament (T‑343/13, EU:T:2015:926), and of 1 December 2021, JR v Commission (T‑265/20, EU:T:2021:850), which concerned the processing of personal data of officials or members of staff of the European Union, the Court considered the actions to be admissible despite the fact that they had not been brought on the basis of Article 270 TFEU.
First, it should be noted that, in the case which gave rise to the judgment of 3 December 2015, CN v Parliament (T‑343/13, EU:T:2015:926), the applicant, who was an official of the Council of the European Union, had sought compensation from the European Parliament, on the basis of the second paragraph of Article 340 TFEU, for damage suffered as a result of the publication on the Parliament’s website of a communication which included his name, a reference to his serious illness and the fact that his son had a serious mental or physical disability. The publication of that communication followed the rejection by the Parliament of the petition submitted by the applicant concerning the support granted to disabled family members of EU officials. However, since the applicant was not an official of the Parliament, he could only invoke the non-contractual liability of that institution on the basis of the second paragraph of Article 340 TFEU. It follows that that judgment is irrelevant for assessing whether, as in the present case, an official or member of staff may bring an action for compensation against the institution for which he or she worked on the basis of the second paragraph of Article 340 TFEU, where the dispute has its origin in the employment relationship between that official or member of staff and that institution.
Secondly, in the case which gave rise to the judgment of 1 December 2021, JR v Commission (T‑265/20, EU:T:2021:850), the applicant, who had applied for an internal competition within the European Commission and who had not been included on the reserve list, had sought the annulment of the Commission’s decisions refusing him access to information concerning that competition. Accordingly, that judgment concerns an action for annulment brought on the basis of Article 263 TFEU and is irrelevant for assessing whether, in the present case, the applicants have the right to bring proceedings against the EIOPA on the basis of the second paragraph of Article 340 TFEU.
The applicants’ second argument must therefore be dismissed.
By their third argument, the applicants consider that the subject matter of the action is not the same as that of the complaint concerning the dismissal decision. They put forward two reasons, namely, in the first place, the action does not concern the validity of the dismissal decision and, in the second place, they are only seeking compensation for the non-material damage suffered as a result of the unlawful processing of their personal data by the EIOPA.
The first justification is irrelevant, since it does not answer the question whether the action, based on the second paragraph of Article 340 TFEU, has its origin in the employment relationship between DR and the EIOPA. As for the second justification, it has already been dealt with in paragraphs 54 to 62 above.
Accordingly, the applicants’ third argument must be rejected and the action must be dismissed as inadmissible.
Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.
Since the applicants have been unsuccessful, they must be ordered to pay the costs, in accordance with the form of order sought by the EIOPA.
On those grounds,
hereby orders:
1.The action is dismissed as inadmissible.
2.DR and DS shall pay the costs.
Luxembourg, 17 January 2025.
Registrar
President
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Language of the case: English.