Order of the Court of 8 July 1999. – Edouard Dubois & Fils SA v Council of the European Union and Commission of the European Communities.

BIB.ORDER

C-95/98 P61998O00950016.000148371485115CJ

ORDER OF 8. 7. 1999 — CASE C-95/98 P

DUBOIS V COUNCIL AND COMMISSION

Order of the Court

8 July 1999^(*)

In Case C-95/98 P,

Edouard Dubois et Fils SA, a company incorporated under French law, established in Roubaix (France), represented by Pierre Ricard, avocat at the French Conseil d'État and Cour de Cassation, and Alain Crosson du Cormier, of the Paris Bar, with an address for service in Luxembourg at the Chambers of Marc Feiler, 67 Rue Ermesinde,

appellant,

APPEAL against the judgment of the Court of First Instance of the European Communities (Fifth Chamber) in Case T-113/96 Dubois et Fils v Council and Commission [1998] ECR II-125, seeking to have that judgment set aside and an order that the Council of the European Union and Commission of the European Communities jointly and severally pay to Edouard Dubois et Fils SA pursuant to the second paragraph of Article 215 of the EC Treaty (now the second paragraph of Article 288 EC) the sum of FRF 112339702 by way of compensation for damage caused to the appellant in its activities as an authorised customs agent and an order that they bear the costs,

the other parties to the proceedings being:

Council of the European Union, represented by Guus Houttuin and Maria Cristina Giorgi, Legal Advisers, acting as Agents, with an address for service in Luxembourg at the office of Alessandro Morbilli, Director-General of the Legal Affairs Directorate of the European Investment Bank, 100 Boulevard Konrad Adenauer,

and

Commission of the European Communities, represented by Hendrik van Lier, Legal Adviser, and Roland Tricot, of its Legal Service, acting as Agents, with an address for service in Luxembourg at the office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre, Kirchberg,

defendants at first instance,

THE COURT,

composed of: G.C. Rodríguez Iglesias, President, P.J.G. Kapteyn, J.-R Puissochet, G. Hirsch, P. Jann (Presidents of Chambers), J.C. Moitinho de Almeida, C. Gulmann, J.L. Murray (Rapporteur), D.A.O. Edward, H. Ragnemalm, L. Sevón, M. Wathelet and R. Schintgen, Judges,

Advocate General: F.G. Jacobs,

Registrar: R. Grass,

after hearing the Advocate General,

makes the following

Order

1By application lodged at the Registry of the Court of Justice on 3 April 1998, Edouard Dubois et Fils SA brought an appeal pursuant to Article 49 of the EC Statute of the Court of Justice against the judgment of the Court of First Instance of 29 January 1998 in Case T-113/96 Dubois et Fils v Council and Commission [1998] ECR II-125 (hereinafter ‘the contested judgment’), by which that Court dismissed its action for damages seeking compensation for the damage it alleges to have suffered as a result of the implementation of the Single European Act (hereinafter ‘the Single Act’) establishing an area without frontiers between the Member States of the Community as of 1 January 1993, and consequently abolishing the customs agency work in which it had been engaged until that date on French territory.

2In the contested judgment the Court of First Instance found:

‘1Article 13 of the Single European Act... which was signed in Luxembourg on 17 February 1986 and in the Hague on 28 February 1986, and came into force on 1 July 1987, supplemented the EEC Treaty by inserting an Article 8a, which, pursuant to paragraph 9 of Article G of the Treaty on European Union, became Article 7a of the EC Treaty, which provides :
“The Community shall adopt measures with the aim of progressively establishing the internal market over a period expiring on 31 December 1992, in accordance with the provisions of this Article...
The internal market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of this Treaty.”
2The completion of the internal market required the creation amongst the Member States of the EEC of “an area without internal frontiers” and thus entailed abolition of frontiers for tax purposes and customs controls within the Community upon expiry of the period fixed by that provision, that is to say by 1 January 1993.
3It was bound to have a serious effect on the continued exercise of certain economic activities directly connected with the existence of customs and tax controls at internal Community borders.
4For that reason, it had a particular impact on customs agents who, for reward, carry out on behalf of others the customs formalities required for goods to be taken across borders. In France, “agents en douane” carry out those formalities on behalf of and in the name of others. “Commissionnaires en douane” carry out the same formalities on behalf of others but in their own name.
5As is clear from a Commission Communication to the Council, Parliament and the Economic and Social Committee entitled “Customs agents: adapting the profession to advent of the single market” (SEC (92) 887 final, hereinafter “the Commission Communication”) various support measures have been taken to take account of the socioeconomic consequences of the creation of the internal market for this profession.
6First, the Member States have consulted, albeit to differing extents, with the professionals concerned and, in many cases, proposed social measures (such as early retirement, retraining, compensation for loss of earnings, relocation assistance and technical assistance with the search for employment) or economic measures (such as allowing employers to set redundancy payments off against tax, allowing longer periods for the payment of value added tax or aid for some firms) (Commission Communication, pages 11 to 13, section III).
7Second, after the Commission commissioned a study financed by the European Social Fund in 1991 (Commission Communication, pages 6 to 11, section II), the Community adopted three categories of measures.
8First, the European Social Fund classified customs agents as long-term unemployed, thereby allowing them to benefit from schemes for training and employment support and specific measures, including assistance with career guidance, which it funded (Commission Communication, pages 14 to 16, section IV.1).
9Second, the Interreg scheme supported the restructuring of the firms affected, the training and reorganisation of their staff, the conversion and refitting of goods-handling sites at frontiers and the creation of replacement jobs (Commission Communication, pages 16 and 17, section IV.2).
10Third, and in addition to the measures described above, which all fall under the structural funds, measures not financed under the structural funds have been proposed and adopted. For instance, the Council adopted Regulation (EEC) No 3904/92 of 17 December 1992 to adapt the profession of customs agent to the internal market (OJ 1992 L 394, p. 1, hereinafter “Regulation No 3904/92”).
11The applicant, a public limited company incorporated under French law, whose share capital is FRF 47850000, employs 1400 people and has 40 branches and agencies. Its principal business is in the area of freight forwarding and related sectors and, before the completion of the internal market, it acted as an authorised customs agent in 16 establishments at various points on French territory.
12It states that, in order to prepare itself for the repercussions on its activities as customs agent of the completion of the internal market after 1 January 1993, it has made a considerable effort to implement a development and redeployment strategy.
13In particular, it has taken advantage of Regulation No 3904/92 and benefited from a decision to grant it ECU 100000, which enabled it to take over another company in compulsory liquidation (Société Adrien Martin, which then became Adrien Martin International). That acquisition was part of its strategy of redeployment of its activities as customs agent towards other activities, in this case towards services connected with goods coming from and destined for non-Community countries.
14It claims that, following the completion of the internal market on 1 January 1993, it suffered the almost total and definitive cessation of its activities as a customs agent. It estimates the resultant material damage at FRF 112339703.’

The contested judgment

3In its action before the Court of First Instance the applicant relied principally on a claim based on the strict liability of the Community and in the alternative on a claim based on its liability for fault. The Court of First Instance dismissed the applicant's action and ordered it to pay the costs.

4The Court of First Instance declared the principal claim inadmissible on the ground that it seeks to impute liability to the Community for damage whose source is to be found in the Single Act, which is an instrument of primary Community law and is thus neither an act of the Community institutions nor an act of the servants of the Community in the performance of their duties and cannot, therefore, give rise to strict non-contractual liability on the part of the Community. It held, moreover, that, under the hierarchy of rules, the provisions of Article 178 and the second paragraph of Article 215 of the EC Treaty (now Articles 235 EC and the second paragraph of Article 288 EC), which govern the non-contractual liability of the Community and are primary law, cannot be brought to bear on instruments belonging to an equivalent level, such as the provisions of the Single Act, where this is not expressly provided for (paragraphs 41, 47 and 48 of the contested judgment).

5The Court of First Instance also held the applicant's claim in the alternative to be unfounded. It observed that omissions by the Community institutions give rise to liability on the part of the Community only where those institutions have infringed a legal obligation to act under a provision of Community law and held that, in the case before it, there was no such obligation either under the Single Act itself or under any other formal rule of Community law, or under any general principle of law by virtue of which the Community would be obliged to compensate a person who has been subject to a measure expropriating his property or restricting his freedom to enjoy his right to property, since the Community cannot be obliged to make good damage caused by acts which cannot be imputed to it. The Court of First Instance therefore concluded that the Community was under no obligation to indemnify members of the profession of intra-Community customs agent (paragraphs 56 and 57 of the contested judgment).

6The Court of First Instance also held that any insufficiency of the Community's action to assist the profession of customs agents when the single market was established, even if the institutions had infringed a legal obligation to act, was not such as to entail the liability of the Community for breach of the principle of the protection of vested rights, since the institutions have a broad discretion in deciding what action to take as regards the adoption of acts of a legislative nature which concern economic policy decisions. In that regard, the Court of First Instance observed that Council Regulation (EEC) No 3632/85 of 12 December 1985 defining the conditions under which a person may be permitted to make a customs declaration (OJ 1985 L 350, p. 1), which neither defines nor clarifies, in Community law, the pursuit of the profession of customs agent, but merely brings into line the conditions under which a person may be permitted to make a customs declaration, did not therefore create for customs agents a clear advantage which could be defined as a vested right (paragraphs 58 to 65 of the contested judgment).

7The Court of First Instance held further, that even if Regulation No 3632/85 did in practice grant a specific advantage to the professional category of customs agents, the members of that profession were still not justified in claiming a vested right in the maintenance of that advantage, since the Community institutions are entitled to adapt rules and regulations to the necessary developments which they must undergo and, therefore, traders cannot claim a vested right in the maintenance of an advantage which they obtained from the Community rules in issue and which they enjoyed at a given time (paragraphs 66 and 67 of the contested judgment).

8Finally, the Court of First Instance added that no-one may plead a breach of the principle of the protection of legitimate expectations unless the administration has given him precise assurances, and that, in the present case, the applicant had furnished no evidence that the Community institutions had caused it to entertain reasonable expectations (paragraphs 68 and 69 of the contested judgment). It held that the freedom to pursue a trade or profession does not constitute an unfettered prerogative, but must be viewed in the light of its social function. In the light of the essential aim pursued, the completion of the internal market, which is an objective of evident general interest, does not entail any undue limitation on the exercise of the fundamental right in question (paragraphs 74 and 75 of the contested judgment).

The appeal

9By its appeal the appellant claims that the Court should set aside the judgment of the Court of First Instance, with all the legal consequences entailed thereby, declare the Council and Commission liable under the second paragraph of Article 215 of the Treaty for the damage caused to it by the repercussions on its activities as an authorised customs agent, order them jointly and severally to pay the sum of FRF 112339702 by way of compensation for that damage and order them to pay the costs.

10By its first plea, the appellant attacks the reasoning in paragraphs 41 to 48 of the contested judgment, on the basis of which the Court of First Instance held its claim founded on the strict liability of the Community to be inadmissible, on the ground that it had invoked the Single Act not as the cause of the damage suffered but as legislation whose entry into force created new obligations to act on the part of the Community institutions.

11It argues that it was for the Community institutions to take appropriate compensatory support measures to facilitate the adaptation of the profession of customs agent. The omission or partial failure to act by the Community institutions entails their liability in so far as general principles of law, including the protection of legitimate expectations, the protection of vested rights and the freedom to exercise a profession, impose an obligation to act (judgment in Case 74/74 CNTA v Commission [1975] ECR 533).

12It contends that that obligation to act derives also from the fact that there was a breach of the principle of equal distribution of public burdens, since Edouard Dubois et Fils SA was the victim of unusual, specific and direct damage (see Joined Cases C-104/89 and C-37/90 Mulder and Others v Council and Commission [1992] ECR I-3061, paragraphs 12 to 16).

13By its second plea, which is in three parts, the appellant submits that the Court of First Instance failed to have due regard to the Community's liability for fault.

14It submits, first, that the Court of First Instance erred in holding that the Community institutions did not breach any higher-ranking rule of law. In the present case, contrary to what was held by the Court of First Instance, there was a breach of vested rights since Regulation No 3632/85 defines the conditions under which a person may make a customs declaration and recognises the existence of the profession of customs agent and its exercise.

15Second, the applicant disputes paragraph 67 of the contested judgment, according to which the institutions are ‘entitled to adapt rules and regulations to the necessary developments which they must undergo’. In its submission, such adaptation cannot disregard the principle of proportionality which requires that any burden imposed on the addressee of the legislation must be limited to the measures strictly necessary for meeting the objective pursued and must require as few sacrifices as possible on the part of the traders it affects (Case 265/87 Schräder [1989] ECR 2237).

16Finally, it contends that the Court of First Instance erred in holding that, even if there had been an omission on the part of the Community institutions, there would have been no wrongful act because there was no legal obligation to act. According to the applicant, such an obligation derives from the principle of the protection of legitimate expectations. It points out that the Commission Communication stressed that the Community support measures for the profession of customs agent were justified and urgent. It adds that it cannot be considered that the Community institutions adopted satisfactory and sufficient measures in Regulation No 3904/92.

Findings of the Court

17Under Article 119 of its Rules of Procedure, where an appeal is clearly inadmissible or clearly unfounded, the Court may at any time dismiss it by reasoned order.

The first plea

18As regards the strict liability of the Community, the Court of First Instance was right to establish, at paragraphs 42 to 47 of the contested judgment, that the cause of the damage could not be imputed to the Council and Commission, as it lay, rather, in the entry into force of the Single Act.

19In that regard, it must be observed that it was the abolition of customs and tax frontiers which put an end to the intra-Community activities of customs agents. All the arguments put forward by the appellant regarding the strict liability of the Community amount therefore to impugning the completion of the internal market and the consequent abolition of customs and tax frontiers, which, since it has substantial adverse effects on the continued exercise of certain economic activities carried out by the appellant, is claimed to be the cause of the alleged damage.

20It follows that Article 13 of the Single Act, which inserted into the EEC Treaty an Article 8a, which became Article 7a of the EC Treaty (now, after amendment, Article 14 EC), and which provides: ‘[t]he internal market shall comprise an area without internal frontiers’, is the direct and determining cause of the damage which the appellant claims to have suffered.

21As the Court of First Instance rightly held at paragraph 47 of the contested judgment, the Single Act is an instrument of primary Community law which is thus neither an act of the Community institutions nor an act of the servants of the Community in the performance of their duties within the meaning of the second paragraph of Article 215 of the Treaty and cannot, therefore, give rise to strict non-contractual liability on the part of the Community.

22It follows that the appellant's plea relating to the strict liability of the Community must be rejected as clearly unfounded.

The second plea

23As regards the first part of the second plea, according to which the Court of First Instance was wrong to dismiss the arguments concerning the Community's liability for fault alleging infringement of vested rights and of the freedom to exercise a profession, it must be held that the Court of First Instance was right in pointing out, at paragraph 66 of the contested judgment, that, in cases where the Community authorities have a broad discretion, traders cannot claim a vested right in the maintenance of an advantage which they obtained from the Community rules in issue and which they enjoyed at a given time. The Court of First Instance was also right to hold, at paragraph 74 of the contested judgment, that the freedom to pursue a trade or profession may be restricted, provided that those restrictions correspond to objectives of general interest pursued by the Community and that they do not constitute a disproportionate and intolerable interference which would affect the very substance of the right so guaranteed. As the appellant has not identified any error of law which the Court of First Instance committed in that regard, its arguments cannot be upheld.

24As regards the second part of the second plea, by which the appellant contests paragraph 67 of the contested judgment on the ground that the adaptation of Community legislation by the institutions breached the principle of proportionality, it is sufficient to observe that at no time did the appellant complain of a breach of that principle before the Court of First Instance. Such a ground of challenge is therefore clearly inadmissible.

25Under the first paragraph of Article 48(2) of the Rules of Procedure of the Court of First Instance, no new plea in law may be introduced in the course of proceedings unless it is based on matters of law or fact which come to light in the course of the procedure.

26To allow a party to put forward for the first time before the Court of Justice a plea in law which it has not raised before the Court of First Instance would be to allow it to bring before the Court of Justice, whose jurisdiction in appeals is limited, a case of wider ambit than that which came before the Court of First Instance. In an appeal the jurisdiction of the Court of Justice is thus confined to review of the findings of law on the pleas argued at first instance (Case C-136/92 P Commission v Brazzelli Lualdi and Others [1994] ECR I-1981, paragraph 59).

27Finally, in the third part of the second plea, based on the breach of the principle of protection of legitimate expectations, the appellant purports to establish that the Community institutions caused it to entertain reasonable expectations that they would adopt compensatory measures on its behalf. By that argument the appellant disputes the findings of fact made by the Court of First Instance.

28In that regard, it must be observed that the Court of First Instance has exclusive jurisdiction to find the facts, save where a substantive inaccuracy in its findings is attributable to the documents submitted to it, and to appraise those facts. The appraisal by the Court of First Instance of the evidence put before it does not constitute (save where the clear sense of that evidence has been distorted) a point of law which is subject, as such, to review by the Court of Justice (Case C-53/92 P Hilti v Commission [1994] ECR I-667, paragraph 42).

29As no distortion of the clear sense of the evidence by the Court of First Instance has been established and the appellant confines itself to disputing the findings of fact made by the Court of First Instance, the appellant's argument cannot be upheld.

30It follows that the appellant's plea relating to the Community's liability for fault must be dismissed in part as clearly inadmissible and in part as clearly unfounded.

31As the pleas relied on by the appellant in support of its appeal are either clearly inadmissible or clearly unfounded, the appeal must be dismissed pursuant to Article 119 of the Rules of Procedure.

Costs

32Under Article 69(2) of the Rules of Procedure, which is applicable to the procedure on appeal by virtue of Article 118, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. As the Council and Commission applied for costs and the appellant has been unsuccessful, it must be ordered to pay the costs.

On those grounds,

THE COURT

hereby orders:

1.The appeal is dismissed.
2.Edouard Dubois et Fils SA shall pay the costs.