OPINION OF MR ADVOCATE-GENERAL MAYRAS

DELIVERED ON 5 MAY 1976 (1)

Mr President,

Members of the Court,

I — At the present stage of the dispute between the National Carbonising Company Ltd. (NCC) and the Commission the Court is only required to give a ruling on the objection of inadmissibility which the Commission raises against the conclusions in the application lodged by that undertaking in Case 114/75.

The activities of this English limited liability company include the production of domestic coke in its two plants at Barnsley and Rotherham.

It purchases the coking coal which it requires from the National Coal Board (NCB), which enjoys a virtual monopoly of coal production in the United Kingdom. In 1974/75 NCC's sales represented approximately 9 % of the market in coal in the United Kingdom.

The Coal Board has a wholly-owned subsidiary, National Smokeless Fuel Ltd. (NSF) which also manufactures domestic coke and whose sales for the same period amount to approximately 88 % of the British market. The NSF is thus what is termed a ‘price leader’. Since 1973 the price of coking coal has risen considerably in the United Kingdom.

Although this increase was checked by a rebate granted by the Coal Board in its sales to NCC of coal intended for the production of domestic coke sold in the United Kingdom this rise has not been accompanied by an equivalent increase in the selling price of domestic coke. In fact the price of domestic coke is strictly controlled on economic and social grounds by the British Government.

On 21 July 1975 Linklaters and Paines of London and Brussels, acting on behalf of NCC, addressed a letter to the Commission of the European Communities.

In this letter NCC complained of the deterioration of its commercial and financial situation which it attributed to an infringement of the ECSC Treaty on the part of the Coal Board and of the British Government; it stated that it would shortly be obliged definitively to close its two plants at Barnsley and at Rotherham if steps were not rapidly taken to re-establish the profitability of the production of domestic coke.

More specifically NCC requested the Commission to consider whether the Coal Board was not indulging in an unfair competitive practice with regard to prices (within the meaning of the first indent of Article 60 (1)), which furthermore constitutes a discriminatory practice (within the meaning of the second indent of Article 60 (1)) and whether this public undertaking was not misusing its dominant position (within the meaning of Article 66 (7)). It requested the Commission to take action under Article 67 or Article 61 or to grant it a financial aid pursuant to the powers which the Commission enjoys under Article 3. The letter concludes with a request, in accordance with Article 35 of the Treaty, to take action in order to ensure that the principles of the Treaty are observed.

The Court can have no doubt but that this letter does indeed constitute the initial ‘formal notice’ necessary to initiate the procedure under the third paragraph of Article 35, as the Court understands it. Likewise the Commission does not dispute this and has not raised any objection in this respect in its defence in the action on the ground of a failure to act which NCC has initiated under Article 35 (Case 109/75). What it does dispute on the other hand is whether it was required or even merely empowered to take other measures than those which it adopted.

In addition the departments of the Commission communicated with the Coal Board and the British Government and began their inquiries and negotiations.

On 13 September a Director of the Directorate-General for Competition addressed a registered letter (No 75-01622) to the Coal Board wherein he formally noted that the Coal Board had undertaken to ensure that the rebate, which had hitherto been granted only for coal intended for the production of domestic coke used on British territory, would henceforth be applied uniformly to coal intended for the production of coke used in all the Member States and that the details of this rebate would be published in accordance with the Communication of the Commission published in the OJ C 29 of 12. 5. 1973, p. 28. The claim of NCC on the basis of the second indent of Article 60 (1) was accordingly satisfied in principle.

With regard to the question of the production costs of the coking plants of NSF which was linked to the allegation of unfair competitive practices (temporary or local price reductions tending towards the acquisition of a monopoly position within the meaning of the first indent of Article 60 (1)) submitted by NCC, the Director requested the Coal Board to supply it as soon as possible with the analysis of the financial situation of that undertaking for the second quarter in order to check whether or not the coking plants of NSF were operating at a loss.

Two days later, on 12 September 1975, and thus before the end of the period of two months on the expiry of which it was possible to lodge an application on the grounds of failure to act if the Commission did not take a decision or make a recommendation, the same Director notified NCC (Letter No 75-01642) that ‘following the intervention of the Commission’ the Coal Board had undertaken to modify its grant of a rebate on the price of coal intended for the production of domestic coke. Consequently NCC was able to avail itself of this new situation (provided that it itself conforms to the provisions of Article 60 (2) (b)) within the limits laid down by Decision 72/443/ECSC (OJ, Special Edition 1972 L 297 of 30. 12. 1972, p. 25).

With regard to the question whether NSF was indulging in an unfair competitive practice (local and temporary price reductions) the Director notified NCC that the investigation was under way and that it would be advised of the outcome ‘as soon as possible’ and also of any further action which the Commission might propose.

Likewise the Court cannot doubt that this letter constitutes a stalling reply which, as it has ruled, cannot interrupt the period of two months laid down in the third paragraph of Article 35 (judgment of 17 July 1959, Safe, Rec. [1959] p. 400).

On 15 September 1975, that is, less than one month before the expiry of this period, since their request had been partly fulfilled, the solicitors of NCC thanked the Commission for its intervention, adding, however, ‘the two plants are … still faced with closure’. The problem still confronting them was whether the substantial change since 1 April 1975 in differential between the charge composed of the purchase price of coking coal and the manufacturing costs on the one hand and the selling price of domestic coke on the other hand, and the consequences thereof constituted an abuse by the Coal Board of its dominant position within the meaning of Article 66 (7) and an unfair competitive practice within the meaning of the first indent of Article 60 (1).

On 16 September a meeting took place in Brussels between the officials of the Commission and representatives of NCC.

On 26 September 1975 the Coal Board, in confirming a telephone discussion which it had had the day before with the relevant Director in relation to the complaint by NCC, notified him by telex that until 15 October the Coal Board would not alter the price of coal intended for the production of domestic coke or the rate of rebate in force.

On the other hand, as the selling price of domestic coke was to be increased from 1 October, this benefited the manufacturers of this product and NCC in particular. The Board added, ‘this concession was made in order to allow the Commission to complete its investigations and on condition that the latter are concluded by 15 October at the latest’.

On 25 September, the day before, NCC had notified the Director of Competition by telex that it took formal note of the proposals of the Coal Board and that it accepted them ‘without prejudice to the application of any decision which the Commission might take and without prejudice to any rights or measures of which NCC might avail itself under the Treaty’. Furthermore NCC stated that it found those measures insufficient even if they were permanent, that the closure of its two plants was imminent and consequently emphasized the urgent need for a solution.

Thus from that date, whilst the Commission had partially and temporarily satisfied the complaint of NCC of 21 July 1975, it had failed to take any decision or make any recommendation within the meaning of the third paragraph of Article 35. Under that provision an implied decision of refusal is to be inferred from such silence and NCC had consequently a period of one month in which to institute proceedings against such refusal.

Thereafter the tempo increased. On 15 October 1975 a meeting was held between the officials of the Directorate for Competition and of the Legal Service of the Commission and the representatives of NCC and its solicitors. In the course of this meeting, according to the notes taken by NCC, the competent Director declared that the Commission had not taken any decision or made any recommendation within the meaning of Article 35 and that the provisional conclusion of the Service was that NCB had not abused its dominant position in this particular case.

Finally, since the Commission maintained that according to the provisions of the Treaty it had no power to intervene, a proposal to this effect was submitted to the Commissioner in charge of competition matters and NCC received a letter signed by the Director-General stating that the Commission could not accept its complaint.

Perfectly logically NCC drew the consequences from this the very next day. By an application recorded at the Registry on 16 October 1975 under No 109, which was notified to the Legal Service of the Commission on the same day, NCC requested the Court to order the Commission to take a decision or make a recommendation

finding that the Coal Board has acted contrary to Article 60 and Article 66,

requiring the Coal Board to ensure the profitability of the production and sale of domestic coke in the United Kingdom,

finding that the British Government had acted contrary to the ECSC Treaty and requiring it to desist from interfering in the fixing of the prices of coking coal and coke for domestic use.

On the same day NCC submitted an application for the adoption of interim measures under Article 39 of the ECSC Treaty and Article 83 of the Rules of Procedure on which the President of the Court gave a ruling by an order on the application for the adoption of an interim measure on 22 October 1975.

Following this order the Commission adopted by a decision of 29 October 1975 measures of conservation for the benefit of NCC for the period running from 22 October 1975 to 15 January 1975 (OJ L 35 of 10. 2. 1975, p. 6).

Further, on the same day, and here we thus come to the facts which are directly related to the present dispute, the Director-General for Competition sent NCC a registered letter (No 75-01866) relating to the letter from the applicant's solicitors of 21 July 1975. For the precise wording of that letter I refer to the report for the hearing and merely wish to mention that after recalling the interventions of the Commission with the Coal Board it concluded thus: ‘the Commission does not consider that NCB has infringed the Treaty’.

By a telex message of 17 October 1975 within the framework of the procedure for an application for the adoption of an interim measure the Commission took note of that reply and, on 22 October 1975, before the order on the application for the adoption of interim measures was made, NCC notified the Commission that it intended to lodge an application for the annulment of the letter of 16 October 1975.

In fact on 25 November 1975, and thus in good time, NCC lodged an application in accordance with Article 33 of the Treaty for the annulment of the ‘decision or of the recommendation of the Commission’ constituted, in its view, by the letter of the Director-General. This is indeed the subject-matter of the application in Case 114/75, the admissibility of which I shall consider in my opinion today.

In this application the Commission has really raised an objection of inadmissibility on the ground that the letter of 16 October 1975 contained neither a decision nor a recommendation.

II — It may appear to the Court that this statement is long and tedious but in the examination which I must undertake chronology and recalling the facts are of particular importance since the judgment on the objection of inadmissibility on which the Court has decided to hear the parties, including the Coal Board which it allowed to intervene on 30 January 1976 in support of the conclusions of the Commission, depend upon the classification of those facts with regard to Articles 33 and 35.

2. In my view this argument is not only conjectural; it is, moreover, somewhat sterile. It is scarcely possible to propound a ‘theory’ regarding failure to act. The reply varies according to the specific case, depending on whether the application, on the ground of failure to act is accompanied by an application for annulment, whether the latter precedes or succeeds the former, and in accordance with the form, the nature and the date of the complaint which constitutes the notice and the express reply which is made to it. As Advocate-General Roemer stated in his Opinion of 15 February 1967 on Cases 8-11/66, Societe Anonyme Cimenteries CBR and Others ([1967] ECR 101): ‘let us not forget that in previous years the Court has on each occasion had to pass judgment on particular cases, and that it is with this in mind that the attempts which it has made to arrive at a definition must be considered. The recognition of this fact … is intended to act as a warning of the danger of taking generalized definitions out of their context and drawing from them rigid legal conclusions which the Court itself cannot have intended, by reason of the nature of its jurisdiction’.

The case-law of the Court appears to me to proceed along those lines as has been excellently demonstrated by Mr Karl Wolf in an article published in the Revue du Marché Commun in 1966, p. 113: if the administration takes an enforceable decision an application for its annulment must be lodged within the prescribed time in order to avoid the loss of the right of action; if an action is not brought against this measure it is impossible subsequently to obtain the annulment of the legal consequences thereof by lodging a complaint with the administration and then bringing an application on the ground of failure to act: a decision of rejection which is alleged to have been taken by implication in an administrative procedure merely constitutes a confirmatory measure and an application for its annulment is only admissible if new facts emerge. Likewise, since the application on the ground of failure to act must be considered as the corollary of an application for annulment, the sole decisive factor is the measure which is held to be adopted by implication on the expiry of the period of two months. This is the measure which must be contested: any communication which is subsequently addressed and which contains a formal rejection is of no validity because it merely constitutes a confirmatory measure (vide in particular Cases 7 and 9/54 Groupement des Industries Sidérurgiques Luxembourgeoises, judgment of 23 April 1956, Rec. p. 90; Cases 32 and 33/58 SNUPAT, judgment of 17 July 1959, Rec. p. 299).

III — In the case presently before the Court NCC, the applicant, alleges in its Application No 114/75 for annulment that the Commission has taken an actionable decision and in its Application No 109/75 on the ground of failure to act that the Commission remained inactive. It is clear that those applications are mutually exclusive since the Commission could not at one and the same time have acted and failed to act but it is no less clear that at least one of those applications is admissible.

The Commission claims that this letter does not correspond to the criteria laid down by Decision No 22/60 of the High Authority of 7 September 1960 (JO of 29. 9. 1960, p. 1248) on the implementation of Article 15 of the ECSC Treaty. As the Court is aware, the aim of that decision was ‘that all persons concerned may ascertain in accordance with clear and objective criteria whether the measures in question constitute decisions, recommendations or opinions within the meaning of Article 14’. This was indeed a praiseworthy aim which, had it been attained, would have considerably facilitated the work of the Court. However, apart from decisions imposing obligations on the persons to whom they are addressed other decisions exist which are purely declaratory in scope and above all, as Mr Paulo Gori has noted in his article ‘Sul concetto di decisione nel trattato della CECA’ published in the ‘Rivista delle Societa’, 1960, p. 1177, there exist implied decisions of refusal or of acquiescence which, whilst they do not fulfil the criteria of Decision No 22/60, are none the less enforceable and therefore actionable. As Mr Advocate-General Lagrange stated in his Opinion on the San Michele cases, ‘The fact that it did not comply with the “canons” of Decision No 22/60 is not in my opinion decisive, for the Court in its judgments has hitherto always concerned itself with material rather than procedural considerations in assessing in each particular case whether there is a decision within the meaning of Article 14 of the Treaty… At least it would be convenient perhaps to make some distinction according to whether the act in question is of a more or a less general and impersonal nature… Yet on the other hand, is it not excessive to require that decisions of this nature should be taken by the full board of the High Authority? In my opinion for this type of action certain powers could quite suitably be delegated to the competent directors.’ I think that those considerations have lost none of their validity. I should add that a letter communicating a refusal to act, and moreover stating the reasons for this, does not necessarily require the signature of a Member of the Commission; it may be issued by the competent Director-General or even by one of his assistants; the intervention of the Commission as a body is probably only necessary for a positive decision of a legislative nature.

With regard to the external characteristics of this letter I am inclined to share the view of Mr Advocate-General Gand who, with regard to the measure contested in the Lütticke case stated in his Opinion of 3 February 1966 ([1966] ECR 31), ‘I do not consider the fact that it [the document] was written on headed stationery and carried a reference number from that Directorate-General and that it was signed by the Director-General concerned in his own name rather than on behalf of the Commission to be decisive. It is clear from the very terms of the letter that its signatory is expressing the point of view of the Commission… To an outsider, unfamiliar with the rules of procedure of the institution, such a document may appear to notify the position defined by the Commission as such and not by one of its departments’.

The applicant was by no means alone in being encouraged in entertaining this notion: a request for information sent by the departments of the Commission on 22 August 1975 to the British Benzole and Carbonising Company justified the urgency of an answer by the fact that the Commission was bound by the Treaty to make its recommendation within a fairly short period. Likewise according to a minute which NCC drew up of the meeting held in Brussels on 16 September the Director concerned requested the applicant not to bring the matter before the Court immediately but to wait until the Commission took either an interim or a final decision. Finally, on 25 September NCC was informed that the Coal Board, as a concession, was prepared to continue supplying it with coking coal at the prevailing price until 15 October pending the adoption of a decision on or before that date.

Accordingly, if Decision No 22/60, which was taken all of 16 years ago in a particular context and for a particular purpose before the ‘merger of the executives’ took place, really had the scope which the Commission attributes to it, that is to say, that only decisions relating to the ECSC which comply with the requirements which it stipulates should be considered as actionable, it may be wondered whether this does not amount to a serious and undesirable diminution of the right of action of the undertakings concerned. In any event it is possible that this decision only binds the institution which adopted it and not the undertakings or the Court.

Likewise the letter of 16 October is in no way provisional. It contains no reservation to this effect and indeed it appears to me that it expresses a definitive point of view despite the fact that the representatives of the Commission had claimed in the course of the meeting held on 15 October 1975 that it would be provisional, and also notwithstanding the fact that this provisional nature is further emphasized by the decision by which the Commission on 29 October 1975, as a result of the order of 22 October on the application for the adoption of an interim measure, adopted measures ‘of conservation’. The definitive nature of this letter is, furthermore, clear from the fact that it was only by reason of the order of the President of the Court that the Commission adopted new measures, of conservation moreover, since, in accordance with the view which it holds with regard to the substance of the case, it did not consider that it was bound or able to adopt other provisions. On this view it is difficult to consider that this letter did not initially rule out the adoption of other, definitive measures.

IV — Even if the Commission had not submitted an objection of inadmissibility against Application No 114/75 the Court has another ground for ruling, indeed of its own motion, that this application is inadmissible; this ground is based on the concept of lis pendens as it is understood by the Court.

In fact the application for annulment and the application on the ground of failure to act relate to the same facts, have the same subject-matter and, although they are based on different articles of the Treaty, they incorporate essentially the same conclusions, those in the application on the ground of failure to act being even more explicit, apart from the reference to Article 34 in Application No 114/75 to which I shall return. The Court has already decided twice, to my knowledge, that it must of its own motion raise an objection of lis pendens in so far as a subsequent application repeats the conclusions of a previous application still before the Court and contests an express decision which merely confirms the implied decision rejecting the complaint of the applicant, a refusal which is already the subject-matter of a separate application (judgment of 26 May 1971, Bode, p. 475; judgment of 17 May 1973, Perinciolo, p. 516).

In the former of these cases, in particular, the Court ruled, contrary to the Opinion of Mr Advocate-General Alain Dutheillet de Lamothe, that ‘As no new element of law or of fact had arisen between the rejection by implication and the express rejection, the applicant cannot establish any legal interest in requesting the annulment of this decision which was by way of confirmation and could not affect him adversely. In fact, under the provisions of the second sentence of the first paragraph of Article 34 of the ECSC Treaty, the first paragraph of Article 176 of the EEC Treaty and the first paragraph of Article 149 of the EAEC Treaty, where a measure of an institution has been declared void by the Court that institution “shall be required to take the necessary measures to comply with” the judgment declaring that the measure is void. It follows that, when the Court annuls a decision, the author of that decision is under an obligation to revoke or at least not to apply a subsequent decision which simply confirms the first one’.

Certainly it is preferable to give a ruling on an express and positive measure than on an implied decision. Nevertheless if the procedure which must take its course is that under Article 35, the only possible procedure in the present case, this in no way restricts the applicant in the grounds which it may plead. In saying this, I am necessarily led to anticipate to some degree the admissibility and the nature of its application in Case 109/75. The contested decision is that whereby the Commission refused by implication to adopt the measures — decision or recommendation — which the applicant considers it was obliged to take. This decision displays the characteristics which the positive measures refused by the Commission would have had, that is to say, of individual measures.

The implied refusal is thus also an individual decision affecting the applicant. The Court has ruled (Case 30/59) Charbonnages Réunis du Limbourg, judgment of 23 February 1961, Rec. p. 35) that the nature of the refusal is that which the positive decision refused by the authority would have had and that the application under Article 35 is, with regard to initiating proceedings, an application under Article 33. Consequently the distinction between Article 33 and Article 35 is irrelevant so far as the applicant is concerned, except that the grounds of lack of competence and of infringement of an essential procedural requirement (failure to state reasons) by their very nature cannot be invoked against an implied refusal (Joined Cases 7 and 9/54 Groupement des Industries Sidérurgiques Luxembourgeoises, judgment of 23 April 1956, Rec. p. 52).

Finally, it should be recalled that Application No 114/75 also contains conclusions the purpose of which is to obtain compensation on the basis of Article 34 for the harm which NCC claims to have suffered because the Commission failed to act or acted incompletely. I consider that these conclusions are also inadmissible or at least premature at the present stage. They can only be taken into consideration after the Court has given a ruling, in Case 109/75, on the measures contested in that application or within the framework of a separate action for compensation. It is thus inaccurate to say, at least from the point of view of Community law, that as long as the letter in dispute is not annulled this circumstance prevents NCC from bringing the matter before the English courts. If it is true, NCC maintains, that an action for compensation before the English courts requires a formal recommendation from the Commission in its favour, the applicant will be able to achieve the same result if it succeeds in the substance of its application under Article 35.

It remains for me to give my views on the questions of costs. It would be logical that, if the applicant fails on the point of the admissibility of its application for annulment, it should be ordered to pay the costs in respect of this phase of the procedure. However, as the Court has ruled, for example in its judgment of 12 February 1960 in Knutange ([1963] ECR 225), I do not suggest that this solution should be adopted in the present case. In fact the applicant was impelled by the very behaviour of the defendant to bring two actions when, had the letter of 16 October not been sent, a single action would have sufficed.

It may be wondered why so detailed a letter was sent to the applicant and one can only be struck by the fact that it was sent to the applicant immediately after the application on the ground of failure to act was lodged: perhaps the departments of the Commission hoped that the applicant would consider that Application No 109/75 had lost its purpose and that, since they had made known their position in a letter which did not constitute a decision in form, the application for annulment would be considered as inadmissible. However, this failed to reckon with the astuteness of the applicant's lawyers who in my opinion did well to introduce a second application as the Commission could have objected that henceforth there existed an express refusal. The tone of the letter in dispute, emphasized by the method of sending it and the date on which it was sent, was by itself liable to confuse the applicant as to the nature of the said letter.

The Commission maintains that it is reasonable and desirable that, in reply to complaints submitted to it, it should indicate if and why it cannot give a favourable reply, even though it is not legally required to do so, in order that undertakings may be able to define their position with regard to the attitude adopted by the departments of the Commission. The Commission adds that if such a letter had to be considered as constituting a decision, its departments would be less inclined to provide written explanations of the point of view of the Commission in cases where they do not contemplate suggesting to the Commission that it should take a decision or make a recommendation. I entirely agree with this principle. None the less the Commission is in no way released from its obligation to reply to undertakings by reason of the consequences which the Court might possibly draw from the explanations furnished by it. I am by no means of the view that the Commission should not reply to the complaints by undertakings. But a reply must be given in sufficient time to allow undertakings to put forward their arguments to good purpose. This was certainly not done in the present case and I consider that it would be better to refrain from providing explanations when the undertaking has already lodged an application on the ground of failure to act, unless this were done for the purpose of consenting to the application: what is the point of explaining to undertakings why the departments of the Commission do not envisage suggesting to it that it should act in the manner desired by the undertakings, after there has already been a failure to act, after an application has been made in connexion with such failure and of explaining that the Commission, and not only its services, at all events will have to clarify this matter in the context of the application on the ground of failure to act, if not to provoke these undertakings into ensnaring themselves in the meshes of procedure? Or alternatively, it would have been necessary that this letter should make quite clear that it merely represented the opinion of the departments and that it was not final: but in that case what would be the purpose of sending it?

Since the Commission has by its behaviour, or by that of its departments, caused the applicant to institute proceedings in order to safeguard its rights, it must at least bear its own costs. I leave it to the Court to decide whether the Commission should not also be required to bear the costs incurred by the applicant as a result of the expense to which it has been put in replying to the Commission as well as to the Coal Board. Likewise I leave it to the Court to decide whether the Coal Board must bear its own costs or whether these costs must be borne by the Commission.

I am of the opinion that the Court should at this point rule that Application No 114/75 is inadmissible and that the parties should bear their own costs relating to the present proceedings, or alternatively that they should be borne by the Commission.

(1) Translated from the French.