J/98/27
Proceedings of the court of justice and the Court of first instance of the european Communities 9 to 13 November 1998
I.JUDGMENTS
Court of Justice
Case C-360/96
Gemeente Arnhem, Gemeente Rheden and BFI Holding BV
Company law
Case C-399/96
Europièces SA and Wilfried Sanders, Automotive Industries Holding Company SA
Social policy
Case C-269/96
Sucreries and Raffineries d'Erstein SA and Fonds d'Intervention and de Régularisation du Marché du Sucre (FIRS)
Agriculture
Case C-102/96
Commission of the European Communities v Federal Republic of Germany
Agriculture
Case C-352/96
Italian Republic v Council of the European Union
Agriculture
Case C-415/96
Kingdom of Spain v Commission of the European Communities
State aid
Case C-134/97
Victoria Film A/S
Taxation
Case C-149/97
The Institute of the Motor Industry and Commissioners of Customs & Excise
Taxation
Court of First Instance
Case T-294/97
Manuel Tomás Carrasco Benítez v Commission of the European Communities
Staff Regulations of Officials
Case T-91/96
Council of the European Union v Nicole Hankart
Staff Regulations of Officials
II.ORDERS
Court of Justice
Case C-162/98
Generalstaatsanwaltschaft v Hans-Jürgen Hartmann
Law governing the institutions
III.OPINIONS
Case C-354/97
Commission of the European Communities v French Republic
Case C-346/97
Braathens Sverige AB (Anciennement Transwede Airways AB) v Riksskatteverket
Case C-75/97
Kingdom of Belgium v Commission of the European Communities
Case C-195/97
Commission of the European Communities v Italian Republic
IV.NEW CASES
Court of Justice
Court of First Instance
1.
JUDGMENTS
Court of Justice
Case C-360/96
Gemeente Arnhem, Gemeente Rheden and BFI Holding BV
Company law
10 November 1998
Preliminary ruling
(Public service contracts · Meaning of contracting authority · Body governed by public law)
(Full Court)
By judgment of 29 October 1996, the Gerechtshof (Regional Court of Appeal), Arnhem, referred to the Court for a preliminary ruling seven questions on the interpretation of Articles 1(b) and 6 of Council Directive 92/50/EEC of 18 June 1992.
Those questions were raised in proceedings brought by Gemeente Arnhem and Gemeente Rheden (Municipalities of Arnhem and Rheden, hereinafter 'the municipalities‘) against BFI Holding BV (hereinafter 'BFI‘), which claims that the award of a contract for refuse collection should be subject to the procedure laid down in the abovementioned directive.
The dispute in the main proceedings
In 1993 the municipalities planned merging the municipal refuse collection services and entrusting them to a new legal entity. The Municipalities of Arnhem and Rheden decided to establish ARA, a public limited company, and to entrust to it a series of tasks defined by law in the field of waste collection.
The framework agreements which the municipalities concluded with ARA specify that the municipalities wish to have the tasks in question carried out exclusively by ARA, and accordingly they grant it concessions for that purpose.
Although initially ARA carried out all collection of household refuse, street cleaning and collection of industrial waste, those activities were subsequently split between it and Aracom, a public limited company. Also, a holding company, ARA Holding NV, was incorporated and holds all the capital of those two companies.
BFI is a private undertaking whose business includes the collection and treatment of household and industrial waste.
On 2 November 1994 BFI brought proceedings before the Arrondissementsrechtbank (District Court), Arnhem, for a declaration that Directive 92/50 applied to the award of the contract granted to ARA, with the result that the municipalities should observe the tendering procedure laid down by that directive.
It is clear from the second subparagraph of Article 1(b) of Directive 92/50 that a body governed by public law means a body established for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character, which has legal personality and is closely dependent on the State, regional or local authorities or other bodies governed by public law.
As the Court held in the judgment of 15 January 1998, Mannesmann Anlagenbau Austria, cited above, the three conditions set out in that provision are cumulative.
The national court considers that the second and third conditions are fulfilled. Its questions thus relate only to the first condition.
The first question
By its first question, the national court seeks clarification as to the relationship between the terms 'needs in the general interest‘ and 'not having an industrial or commercial character‘. It asks in particular whether the latter expression is intended to limit the term 'needs in the general interest‘ to those which are not of an industrial or commercial character or, on the contrary, whether it means that all needs in the general interest are not industrial or commercial in character.
The only interpretation capable of guaranteeing the effectiveness of the second subparagraph of Article 1(b) of Directive 92/50 is that it creates, within the category of needs in the general interest, a sub-category of needs which are not of an industrial or commercial character.
If the Community legislature had considered that all needs in the general interest were not of an industrial or commercial character it would not have said so because, in that context, the second component of the definition would serve no purpose.
The third question
By its third question, the national court asks essentially whether the term 'needs in the general interest, not having an industrial or commercial character‘ excludes needs which are also met by private undertakings.
Since it is hard to imagine any activities that could not in any circumstances be carried on by private undertakings, the requirement that there should be no private undertakings capable of meeting the needs for which the body in question was set up would be liable to render meaningless the term 'body governed by public law‘ used in Article 1(b) of Directive 92/50.
It was for that reason that, in Mannesmann Anlagenbau Austria, cited above, the Court held, without considering whether private undertakings might meet the same needs, that a State printer met needs in the general interest not having an industrial or commercial character.
It follows that Article 1(b) of Directive 92/50 may apply to a particular body even if private undertakings meet, or may meet, the same needs as it and that the absence of competition is not a condition necessarily to be taken into account in defining a body governed by public law.
In this case it is undeniable that the removal and treatment of household refuse may be regarded as constituting a need in the general interest. Since the degree of satisfaction of that need considered necessary for reasons of public health and environmental protection cannot be achieved by using disposal
services wholly or partly available to private individuals from private economic operators, that activity is one of those which the State may require to be carried out by public authorities or over which it wishes to retain a decisive influence.
The fourth, fifth and seventh questions
By its fourth, fifth and seventh questions, the national court asks whether the condition that a body must have been set up for the specific purpose of meeting needs in the general interest means that the activity of that body must, to a considerable extent, be concerned with meeting such needs.
It must be borne in mind here that, in Mannesmann Anlagenbau Austria, cited above, the Court held that it was immaterial whether, in addition to its duty to meet needs in the general interest, an entity was free to carry out other activities. The fact that meeting needs in the general interest constitutes only a relatively small proportion of the activities actually pursued by that entity is also irrelevant, provided that it continues to attend to the needs which it is specifically required to meet.
Since the status of a body governed by public law is not dependent on the relative importance, within its business as a whole, of the meeting of needs in the general interest not having an industrial or commercial character, it is a fortiori immaterial that commercial activities may be carried out by a separate legal person forming part of the same group or concern as it.
The sixth question
By its sixth question, the national court, finally, wishes to ascertain what inferences are to be drawn from the fact that the provisions setting up the entity in question and specifying the needs which it must meet are in the nature of laws, regulations or administrative or other provisions.
The wording of the second subparagraph of Article 1(b) of Directive 92/50 makes no reference to the legal basis of the activities of the entity concerned.
Furthermore, it must be borne in mind that, with a view to giving full effect to the principle of freedom of movement, the term 'contracting authority‘ must be interpreted in functional terms. In view of that need, no distinction should be drawn by reference to the legal form of the provisions setting up the entity and specifying the needs which it is to meet.
The Court ruled:
'1.The second subparagraph of Article 1(b) of Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts must be interpreted as meaning that the legislature drew a distinction between needs in the general interest not having an industrial or commercial character and needs in the general interest having an industrial or commercial character.
2.The term ”needs in the general interest, not having an industrial or commercial character” does not exclude needs which are or can be satisfied by private undertakings as well.
3.The status of a body governed by public law is not dependent on the relative importance, within its business as a whole, of the meeting of needs in the general interest not having an industrial or commercial character. It is likewise immaterial that commercial activities may be carried out by a separate legal person forming part of the same group or concern as it.
4.The second subparagraph of Article 1(b) of Directive 92/50 must be interpreted as meaning that the existence or absence of needs in the general interest not having an industrial or commercial character must be appraised objectively, the legal form of the provisions in which those needs are mentioned being immaterial in that respect.‘
Advocate General A. La Pergola delivered his Opinion at the sitting of the Full Court on 19 February 1998.
He proposed that the Court reply as follows:
'1.The relationship between two municipalities and a body established by them, to which they have entrusted the refuse collection and disposal service within their areas and whose remuneration is charged to the municipal budget, ensuring that that body in any event receives a proper financial return for its activities, is not a service contract within the meaning of Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts.
2.An entity of the type described above is also a body governed by public law within the meaning of Directive 92/50/EEC‘.
Case C-399/96
Europièces SA and Wilfried Sanders, Automotive Industries Holding Company SA
Social policy
12 November 1998
Preliminary ruling
(Social policy · Harmonisation of laws · Transfers of undertakings · Safeguarding of workers' rights · Directive 77/187/EEC · Scope · Transfer of an undertaking in voluntary liquidation)
(Second Chamber)
By judgment of 11 December 1996, the Cour du Travail de Bruxelles (Higher Labour Court, Brussels) referred to the Court for a preliminary ruling a question on the interpretation of Council Directive 77/187/EEC of 14 February 1977 (hereinafter 'the Directive‘).
That question was raised in proceedings between Mr Sanders, a sales representative, and Europièces SA, a company in liquidation, relating to the payment of compensation under various heads, including compensation in lieu of notice.
Community legislation
Mr Sanders was employed by Europièces as a sales representative for the Erpent office from 15 February 1974. In July 1993 Europièces went into voluntary liquidation and a liquidator was appointed. On 27 July 1993, the liquidator dismissed Mr Sanders with 22 months' notice.
On 13 August 1993, the liquidator of Europièces informed Mr Sanders that Europièces had transferred part of its stock and equipment to Automotive Industries Holding Company SA (hereinafter 'Automotive Industries‘); that not all of Europièces' business had been transferred to Automotive Industries; and that, as from 24 August, Mr Sanders would have to carry on his activities on behalf of the liquidation in the Brussels office under the direct orders of the liquidator's representative. The liquidator also indicated in that letter that he had been informed that draft contracts of employment had been submitted by Automotive Industries to some members of staff including Mr Sanders, who had refused the offer.
Following an exchange of correspondence, Mr Sanders sent a letter to the liquidator on 18 October 1993 stating his view that his contract of employment as a sales representative had been the subject of a unilateral breach, or had at the very least been terminated.
The question referred
The question referred seeks to ascertain first of all whether Article 1(1) of the Directive is to be interpreted as meaning that the Directive applies where a company in voluntary liquidation transfers all or part of its assets to another company from which the worker then takes his orders which the company in liquidation states are to be carried out.
Secondly, it is necessary to establish whether Article 3(1) of the Directive precludes a worker employed by the transferor at the date of the transfer of the undertaking from objecting to the transfer of his contract of employment or employment relationship to the transferee.
Whether there is a transfer within the meaning of the Directive
The first point to note in this regard is that the Directive does not apply to the transfer of an undertaking, business or part of a business in the course of insolvency proceedings.
The Court found in Dethier Équipement of 12 March 1998 that the Directive applies in the event of the transfer of an undertaking which is being wound up by the court if the undertaking continues to trade. In particular, it observed that where the undertaking continues to trade while it is being wound up by the court, continuity of the business is assured when the undertaking is transferred. There is accordingly no justification for depriving the employees of the rights which the Directive guarantees them on the conditions it lays down.
So far as this case is concerned, it must be borne in mind that voluntary liquidation is essentially similar to winding up by the court, save for the fact that it falls to the shareholders in general meeting, and not to the court, to take the decision to wind up the company, appoint the liquidators and determine their powers.
Thus it would seem that, at least in some procedural respects, voluntary liquidation has even less in common with insolvency than winding up by the court.
In the light of the foregoing, it should be noted that the reasons which led the Court to hold in Dethier Équipement that the Directive can apply to transfers that occur while an undertaking is being wound up by the court are all the more pertinent where the undertaking transferred is being wound up voluntarily.
The worker's right to object to the transfer of his contract of employment or employment relationship
The protection which the Directive is intended to guarantee is redundant where the person concerned decides of his own accord not to continue the employment relationship with the new employer after the transfer.
It appears from the order for reference that draft contracts of employment were submitted to various members of staff, including Mr Sanders who declined to enter into them.
In addition, the liquidator would appear to have informed Mr Sanders that the intention was not to change his duties unilaterally, but that circumstances and legal requirements made it necessary to allocate other tasks to him.
That being so, it is for the national court to examine the reasons why the employee refused the contract of employment offered to him and to determine whether that contract involved a substantial change in working conditions to his detriment.
The Court ruled:
'1.Article 1(1) of Council Directive 77/187/EEC of 14 February 1977 on the approximation of the laws of the Member States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of businesses is to be interpreted as meaning that the directive applies where a company in voluntary liquidation transfers all or part of its assets to another company from which the worker then takes his orders which the company in liquidation states are to be carried out.
2.Article 3(1) of Directive 77/187/EEC does not preclude a worker employed by the transferor at the date of the transfer of an undertaking from objecting to the transfer of his contract of employment or employment relationship to the transferee, provided he decides to do so of his own accord. It is for the national court to determine whether the contract of employment proposed by the transferee involves a substantial change in working conditions to the detriment of the worker. If it does, Article 4(2) of the directive requires Member States to provide that the employer is to be considered responsible for the termination.‘
Advocate General G. Cosmas delivered his Opinion at the sitting of the Second Chamber on 7 May 1998.
He proposed that the Court reply as follows:
'Council Directive 77/187/EEC of 14 February 1977 on the approximation of the laws of the Member States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of businesses is applicable in the case of a transfer made by a company in voluntary liquidation, subject only to the condition that the undertaking's activity continues to be carried on.‘
Case C-269/96
Sucreries and Raffineries d'Erstein SA and Fonds d'Intervention and de Régularisation du Marché du Sucre (FIRS)
Agriculture
12 November 1998
Preliminary ruling
(Council Regulations (EEC) Nos 1785/81 and 2225/86 · Aid for the marketing of cane sugar produced in the French overseas departments · Concept of refinery)
(Fourth Chamber)
By judgment of 12 June 1996, the Tribunal Administratif (Administrative Court), Paris, referred to the Court for a preliminary ruling a number of questions on the interpretation of Council Regulation (EEC) No 1785/81 of 30 June 1981 and Council Regulation (EEC) No 2225/86 of 15 July 1986 laying down measures for the marketing of sugar produced in the French overseas departments and for the equalisation of the price conditions with preferential raw sugar.
Those questions were raised in proceedings between Sucreries et Raffineries d'Erstein SA and the Fonds d'Intervention et de Régularisation du Marché du Sucre, the public body responsible in France for the management of the markets in the sugar sector, concerning the payment of aid, provided for by Community legislation, for the refining of cane sugar produced in the French overseas departments.