JUDGMENT OF THE COURT

5 May 1998 (1)

(Emergency assistance given by the Community to the States of the formerSoviet Union — Loan — Documentary credit — Action for annulment —Admissibility — 'Directly concerned‘)

In Case C-386/96 P,

Société Louis Dreyfus & C^ie, a company incorporated under French law, establishedin Paris, represented by Robert Saint-Esteben, of the Paris Bar, with an address forservice in Luxembourg at the Chambers of Aloyse May, 31 Grand-Rue,

appellant,

APPEAL against the judgment of the Court of First Instance of the EuropeanCommunities (Third Chamber) of 24 September 1996 in Case T-485/93 Dreyfus vCommission [1996] ECR II-1101, seeking to have that judgment set aside,

the other party to the proceedings being:

Commission of the European Communities, represented by Marie-José Jonczy,Legal Adviser, and Nicholas Khan, of its Legal Service, acting as Agents, with anaddress for service in Luxembourg at the office of Carlos Gómez de la Cruz, of itsLegal Service, Wagner Centre, Kirchberg,

THE COURT,

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

Advocate General: A. La Pergola,

Registrar: D. Louterman-Hubeau, Principal Administrator,

having regard to the Report for the Hearing,

after hearing oral argument from the parties at the hearing on 8 October 1997

after hearing the Opinion of the Advocate General at the sitting on 16 December1997,

gives the following

Judgment

1.

    By application lodged at the Registry of the Court of Justice on 28 November 1996,Louis Dreyfus & C^ie (hereinafter 'Dreyfus‘ or 'the appellant‘) brought an appealunder Article 49 of the EC Statute of the Court of Justice against the judgment ofthe Court of First Instance of 24 September 1996 in Case T-485/93 Dreyfus vCommission [1996] ECR II-1101 (hereinafter 'the contested judgment‘), dismissingas inadmissible its action for the annulment of the Commission's decision of 1 April1993 addressed to the Vnesheconombank.

Legal background

2.

    On 16 December 1991, the Council adopted Decision 91/658/EEC granting amedium-term loan to the Soviet Union and its constituent Republics (OJ 1991L 362, p. 89).

3.

    Article 1(1) thereof provides:

'The Community shall grant to the USSR and its constituent Republics a medium-term loan of not more than ECU 1 250 million in principal, in three successiveinstalments and for a maximum duration of three years, in order to enableagricultural and food products and medical supplies ... to be imported.‘

4.

    Article 2 of Decision 91/658 provides that for those purposes:

'... the Commission is hereby empowered to borrow, on behalf of the EuropeanEconomic Community, the necessary resources that will be placed at the disposalof the USSR and its constituent Republics in the form of a loan‘.

5.

    Article 3 provides:

'The loan referred to in Article 2 shall be managed by the Commission.‘

6.

    Article 4 further provides:

'1.    The Commission is hereby empowered to finalise, in concert with theauthorities of the USSR and its constituent Republics ..., the economic andfinancial conditions to be attached to the loan, the rules governing the provision offunds and the necessary guarantees to ensure loan repayment.

...

3.    Imports of products financed by the loan shall be effected at world marketprices. Free competition shall be guaranteed for the purchase and supply ofproducts, which shall meet internationally recognised standards of quality.‘

7.

    On 9 July 1992 the Commission adopted Regulation (EEC) No 1897/92 layingdown detailed rules for the implementation of a medium-term loan to the SovietUnion and its constituent Republics [in accordance with] Council Decision91/658/EEC (OJ 1992 L 191, p. 22).

8.

    Under Article 2 of that regulation:

'The loans shall be concluded on the basis of agreements entered into between theRepublics and the Commission which shall include, as conditions for disbursementof the loan, the requirements set out in Articles 3 to 7.‘

9.

    Article 4 of Regulation No 1897/92 states that:

'1.    The loans shall only finance the purchase and supply under contracts thathave been recognised by the Commission as complying with the provisions ofDecision 91/658/EEC and with the provisions of the agreements referred to inArticle 2.

2.    Contracts shall be submitted to the Commission for recognition by theRepublics or their designated financial agents.‘

10.

    Article 5 sets out the conditions of recognition pursuant to Article 4. These includethe two following conditions:

'(1)    The contract was awarded following a procedure guaranteeing freecompetition ...

(2)    The contract offers the most favourable terms of purchase in relation to theprice normally obtained on the international markets.‘

11.

    On 9 December 1992 the European Economic Community, the Russian Federation,as successor in law of the USSR, and its financial agent, the Vnesheconombank('VEB‘), signed a Memorandum of Understanding under Regulation No 1897/92,on the basis of which the European Community was to grant to Russia the loanprovided for in Decision 91/658. It was provided that the EEC as lender wouldgrant to the VEB, as borrower, under the guarantee of the Russian Federation, amedium-term loan of the principal sum of ECU 349 million for a maximum termof three years.

12.

    Paragraph 6 of the Memorandum provides:

'The proceeds of the loan, less commissions and costs incurred by the EEC, shallbe disbursed to the borrower and applied, according to the terms and conditionsof the Loan Agreement, exclusively to cover irrevocable documentary credits issuedby the borrower in international standard form pursuant to delivery contractsprovided that such contracts and documentary credits have been approved by theCommission of the European Communities as complying with the Council decisionof 16 December 1991 and the present Memorandum of Understanding.‘

13.

    Paragraph 7 sets out the conditions to which recognition of the conformity of thecontract is subject. It states in particular that the suppliers are to be selected byRussian organisations designated to that end by the Government of the RussianFederation.

14.

    On 9 December 1992 the Commission and the VEB signed the loan agreementprovided for in Regulation No 1897/92 and the Memorandum of Understanding(hereinafter 'the loan agreement‘). That agreement sets out in precise terms themachinery for the disbursement of the loan. It establishes a facility to whichrecourse may be had during the drawing period (15 January 1993 to 15 July 1993),with a view to the advance of sums authorised for payment of the price of goodssupplied.

15.

    On 15 January 1993, in accordance with Article 2 of Decision 91/658, theCommission, as borrower, concluded on behalf of the Community a loan agreementwith a consortium of banks led by Crédit Lyonnais.

Facts and procedure before the Court of First Instance

16.

    In the contested judgment the Court of First Instance made the following findings:

'8    The applicant, an international trading company, was contacted, togetherwith other companies, in connection with an [informal] invitation to tenderorganised by Exportkhleb, a State-owned company charged by the RussianFederation with the negotiation of wheat purchases.

9    On 28 November 1992 the applicant signed a contract with Exportkhleb forthe sale of wheat, whereby it undertook to supply 325 000 tonnes of millingwheat at a price of US $140.50 per tonne, CIF free out one safe Baltic Seadischarge port. That contract stipulated that the goods were to be shippedby 28 February 1993.

10    Following signature of the loan agreement ... the VEB requested theCommission to approve the contracts concluded between Exportkhleb andthe exporting companies, including the contract signed with the applicant.

11    After the Commission had obtained from the applicant various additionalitems of essential information, concerning in particular the ecu/US$exchange rate, which had not been fixed in the contract, it finally gave itsapproval on 27 January 1993, in the form of a notice of confirmationaddressed to the VEB. According to the applicant, that notice ofconfirmation modified the contract in two respects, namely the shipmentperiod, which the Commission automatically extended until 31 March 1993,and the ecu/US$ exchange rate, which was neither that proposed by theapplicant to Exportkhleb on 25 January 1993 (ECU 1 = US $1.1711) northat agreed between them on 28 January 1993 (ECU 1 = US $1.1714,bringing the agreed price up to ECU 119.94 per tonne).

12    According to the applicant, the documentary credit was set up by the VEBon 4 February 1993 but the letter of credit did not become effective until16 February 1993, that is to say, approximately two weeks before the endof the shipment period provided for by the contracts (28 February 1993).

13    Although a substantial part of the goods had been delivered or was in thecourse of shipment, it was becoming clear, according to the applicant, thatit would not be possible to deliver all the goods by 28 February 1993.

14    On 19 February 1993 Exportkhleb invited all the exporters to attend ameeting in Brussels, which was held on 22 and 23 February 1993. At thatmeeting Exportkhleb requested the exporters to submit fresh quotations fordelivery of what it termed the ”foreseeable balance”, that is to say, thequantities which could not reasonably be expected to be delivered by 28February 1993. According to the applicant, the price of wheat on the worldmarket rose considerably between November 1992, when the sale contractwas concluded, and February 1993, when the fresh negotiations took place,going up from US $132 in November 1992 to US $149.50 in February 1993.

15    Following negotiations in which the exporting companies had to alignthemselves to the lowest bid, namely US $155 per tonne, agreement wasreached between Exportkhleb and its contracting partners regarding theallocation of the fresh quantities to be supplied by each company. Theapplicant was awarded a contract for 185 000 tonnes of milling wheat. Under that informal agreement, the shipment period was to end on 30 April1993.

16    By reason of the urgency arising from the seriousness of the food situationin Russia, it was decided that those modifications would be formalised bya simple [addendum] to the initial contract, which was dated — for the sakeof convenience, according to the applicant — 23 February 1993, the date ofthe meeting in Brussels, even though, as the applicant acknowledges, it wasnot actually signed until the third week of March.

17    On the strength of the new terms agreed with Exportkhleb and — accordingto the applicant — the Russian organisation's verbal assurances that theCommission would accept the new amendments, the applicantrecommenced deliveries of wheat bound for Russia from 4 March 1993onwards.

18    On 9 March 1993 Exportkhleb informed the Commission, first, that thecontracts concluded with five of its suppliers had been amended and,second, that the deliveries still to be made would henceforth be effected ata price of US $155 per tonne (CIF free out Baltic port), to be convertedinto ecus at a rate of 1.17418 (ECU 132 per tonne).

19    On 12 March 1993 Mr Legras, Director General in the Directorate-Generalfor Agriculture (DG VI), replied to Exportkhleb, stating that he wished todraw its attention to the fact that, since the maximum value of thosecontracts had already been set by the Commission's notice of confirmationand the whole available amount of credits for wheat was already contracted,such a request could only be accepted by the Commission if the total valueof the contracts was maintained, which could be done by a correspondingreduction in outstanding quantities to be delivered. He further stated thatthe request for approval of the amendments could only be considered bythe Commission pursuant to an official request from the VEB.

20    According to the applicant, that information was interpreted as confirmingthe Commission's agreement in principle, subject to scrutiny for thepurposes of formal approval once the documentation was sent by the VEB.It was for that reason that the applicant continued to ship the cargoes ofwheat bound for Russia.

21    According to the applicant, the documentation containing the new bids andthe amendments to the contract were officially sent by the VEB to the

Commission on 22 and 26 March 1993. The applicant maintains that on 5April 1993 it was informed by Exportkhleb of the Commission's refusal toapprove the amendments to the contract as initially concluded; that refusalwas given concrete form by a letter sent to the VEB on 1 April 1993 by theAgriculture Commissioner. On that same day, 5 April 1993, the applicantdecided to stop its deliveries of wheat.

22    The contents of the letter of 1 April 1993 may be summarised as follows. The Commissioner, Mr R. Steichen, stated that, having examined theamendments to the contracts concluded between Exportkhleb and varioussuppliers, the Commission was prepared to accept those relating to thepostponement of the final dates for delivery and payment. On the otherhand, ”the magnitude of the price increases is of such a nature that wecannot consider them as a necessary adaptation but as a substantialmodification of the contracts initially negotiated”. He went on to state: ”Infact, the present level of prices on the world market (end of March 1993)is not significantly different from the level which prevailed at the time whenthe initial prices were agreed (end of November 1992).” The Commissionerpointed out that the need, first, to ensure free competition betweenpotential suppliers and, second, to secure the most favourable purchaseterms constituted one of the main factors governing the approval ofcontracts by the Commission. He found that, in the present case, theamendments had been negotiated directly with the companies concerned,without any competition with other suppliers, and concluded: ”TheCommission cannot approve such major changes as simple amendments toexisting contracts.” The Commissioner stated that he would be willing toapprove the amendments relating to the postponement of delivery andpayment, subject to compliance with the usual procedure. On the otherhand, he stated that ”should it be considered necessary to modify the pricesor quantities, it would then be appropriate to negotiate new contracts to besubmitted to the Commission for approval under the full usual procedure(including submission of at least 3 offers)”.

...

23    It was in those circumstances that, by application lodged at the Registry ofthe Court of Justice on 9 June 1993 ..., the applicant brought the presentaction.

24    By order of 27 September 1993 the Court of Justice referred the case to theCourt of First Instance pursuant to Council Decision 93/350/Euratom,ECSC, EEC of 8 June 1993 amending Decision 88/591/ECSC, EEC,Euratom establishing a Court of First Instance of the EuropeanCommunities (OJ 1993 L 144, p. 21).

25    ... By document lodged at the Registry on 15 September 1993 the    Commission raised an objection of admissibility.‘

17.

    The contested judgment indicates that the applicant requested the Court to annulthe Commission's decision of 1 April 1993 refusing to approve the amendments tothe supply contract concluded with Exportkhleb (hereinafter 'the contesteddecision‘), and to order the Commission to pay it compensation for the pecuniarydamage suffered by it, amounting to ECU 253 991.98 in respect of loss of interest,ECU 1 347 831.56 in respect of the difference between the initial contract priceand the amended contract price and US$ 229 969.58 in respect of loss on theecu/US$ exchange rate, and ECU 1 as compensation for the non-material damagesuffered (paragraph 28).

18.

    The Commission raised an objection of inadmissibility, contending that the Courtshould:

'—    declare the application for annulment inadmissible on the ground that thematter is not of direct concern to the applicant;

—    declare either that the contested decision does not give rise to liability onthe part of the Commission or that the action is inadmissible since itconcerns a complaint which does not put the Commission's non-contractualliability in issue‘ (paragraph 29).

The contested judgment

Admissibility of the action for annulment

19.

    The Court of First Instance dismissed the action for the annulment of the contesteddecision as inadmissible on the following grounds:

'46    According to the fourth paragraph of Article 173 of the Treaty, any naturalor legal person may institute proceedings against a decision which, althoughin the form of a decision addressed to another person, is of direct andindividual concern to the former.

47    It is necessary, therefore, to determine whether the letter sent by theCommission to the VEB on 1 April 1993 is of direct and individual concernto the applicant.

48    First of all, the Commission has not denied that the applicant is individuallyconcerned. Having regard to the circumstances of the case, the Courtconsiders that only the question whether the contested decision is of directconcern to the applicant need be examined.

49    The Community rules and the agreements concluded between theCommunity and the Russian Federation provide for a division of powersbetween the Commission and the agent appointed by the RussianFederation to arrange the purchase of wheat. It is for that agent — in thepresent case, Exportkhleb — to select the other contracting party by meansof an invitation to tender and to negotiate and conclude the contract. TheCommission's role is merely to verify that the conditions for Communityfinancing are fulfilled and, where necessary, to acknowledge, for thepurposes of the disbursement of the loan, that such contracts are inconformity with the provisions of Decision 91/658 and with the agreementsconcluded with the Russian Federation. It is not for the Commission,therefore, to assess the commercial contract with reference to any othercriteria.

50    It follows that the undertaking to which a contract is awarded has a legalrelationship only with the party with whom it contracts, namely Exportkhleb,which is authorised by the Russian Federation to conclude contracts for thepurchase of wheat. The Commission, for its part, has legal relations onlywith the borrower, namely the Russian Federation's financial agent, theVEB, which notifies it of commercial contracts so that their conformity canbe recognised, and which is the addressee of the Commission's decision inthat regard.

51    The action of the Commission does not therefore affect the legal validity ofthe commercial contract concluded between the applicant and Exportkhleb;nor does it modify the terms of the contract, particularly as regards theprices agreed by the parties. Thus, irrespective of the Commission'sdecision not to recognise the agreements as being in conformity with theapplicable provisions, the amendment which the parties made on 23February 1993 to their contract of 28 November 1992 remains validlyconcluded on the terms agreed between them.

52    The fact that the Commission was in contact with the applicant or withExportkhleb cannot affect that assessment of the legal rights and obligationswhich each of the parties involved has under the applicable legislation andcontractual agreements. Moreover, as regards the admissibility of theapplication for annulment, the exchanges relied on by the applicant do notshow that the Commission went beyond its proper role. Thus, the lettersent by the Commission to Exportkhleb on 12 March 1993 expressly statesthat the amendments required an official request from the VEB. Similarly,the sole purpose of the alleged contacts between the Commission and theapplicant in January 1993 was to have the parties include in their contracta condition which was indispensable for acceptance of conformity but it wasleft to the parties alone to modify their contract if they wanted to secure thefinancing provided for. Lastly, the fact that, several weeks before the

adoption of its decision, the Commission held a meeting in Brussels with theapplicant in order to explain its position does not as such establish that thatdecision was of direct concern to the applicant.

53    Whilst it is true that, on receiving from the Commission a decision findingthat the contract is not in conformity with the applicable provisions, theVEB cannot issue a documentary credit capable of being covered by theCommunity guarantee, nevertheless, as stated above, the decision affectsneither the validity nor the terms of the contract concluded between theapplicant and Exportkhleb. The Commission's decision does not take theplace of a decision taken by the Russian national authorities, since theCommission may only examine the conformity of contracts for the purposesof Community financing.

54    Lastly, in order to establish that the contested decision is of direct concernto it, the applicant cannot rely on the presence in the commercial contractsof a suspensory clause making performance of the contract and payment ofthe contract price subject to acknowledgement by the Commission that thecriteria for disbursement of the Community loan are fulfilled. Such a clauseis a link which the contracting parties decide to make between the contractconcluded by them and a contingent future event; their agreement will bebinding only if the latter occurs. The admissibility of an application underthe fourth paragraph of Article 173 of the Treaty cannot, however, be madeto depend on the intention of the parties. The applicant's argument musttherefore be rejected.

55    In view of the foregoing, the Court considers that the Commission's decisionof 1 April 1993, addressed to the VEB, is not of direct concern to theapplicant, within the meaning of the fourth paragraph of Article 173 of theTreaty. Consequently, the application for annulment of that decision mustbe declared inadmissible.‘

20.

    The Court of First Instance declared admissible, however, the claims forcompensation for the material and non-material damage allegedly suffered by theapplicant on grounds which are not contested in this appeal.

21.

    In the light of those considerations, the Court of First Instance:

(1)    dismissed the application for annulment as inadmissible;

(2)    dismissed the objection of inadmissibility inasmuch as it concerned theclaims for compensation for the material and non-material damage allegedlysuffered by the applicant;

(3)    ordered the procedure relating to those claims for compensation to becontinued in relation to the substance;

(4)     reserved the costs.

The appeal

22.

    In support of its appeal Dreyfus relies on two pleas: infringement of the fourthparagraph of Article 173 of the Treaty and contradictory reasoning vitiating thejudgment.

The first plea

23.

    The first plea is divided into three limbs.

24.

    First, the appellant criticises the Court of First Instance's conclusion that, in theabsence of direct legal relations with the Commission, the appellant could not bedirectly concerned by the decision since the 'validity of the contract‘ or 'its terms‘were not affected (paragraphs 49, 50 and 51 of the contested judgment). However,the Court of Justice, and indeed the Court of First Instance itself, have held thatan individual may be directly concerned, even if he has not entered into legalrelations with the Commission, where his 'legal or factual situation‘ is directlyaffected by the decision (Joined Cases 41/70 to 44/70 International Fruit Companyand Others v Commission [1971] ECR 411, Case C-135/92 Fiskano v Commission[1994] ECR I-2885 and Case T-83/92 Zunis Holding and Others v Commission[1993] ECR II-1169).

25.

    That is the case, the appellant submits, in triangular transactions where the nationalauthority entrusted with implementing the Community decision has no margin ofdiscretion, as in the present case.

26.

    The parties had provided in their contract that it would be subject to theCommission's approval and that payment of the price would be by way of theCommunity loan. Therefore, that loan and the loan agreement entered into in thatconnection between the Commission and the Russian Federation were both theprecondition for the performance of the contract and the sole means of payment,not only de facto but also de jure.

27.

    As a result, contrary to what was stated in the judgment appealed against, theappellant's legal and factual situation was directly affected by the contested decisionbecause the Russian authorities were obliged to pay the new price provided for inthe addendum to the contract only and in so far as the Community loan wasforthcoming.

28.

    The appellant goes on to criticise the Court of First Instance for taking the viewthat 'the Commission's decision does not take the place of a decision taken by the

Russian national authorities, since the Commission may only examine theconformity of contracts for the purposes of Community financing‘ (paragraph 53). Relying on the judgment in International Fruit Company, cited above, the appellantmaintains on the contrary that, in the absence of any discretion exercisable on thepart of the Russian authorities in implementing the contested decision, that decisiondirectly and automatically affected the appellant's legal situation under the contract. Consequently, the Russian authorities had no alternative but to note that theCommission had not given its approval and, thus, to pay for the supplies of wheatat the old price under the initial contract and not at the new price agreed on in theaddendum to the contract.

29.

    Finally, the appellant challenges the statement by the Court of First Instance thatthe 'suspensory clause making performance of the contract and payment of thecontract price subject to acknowledgement by the Commission that the criteria fordisbursement of the Community loan are fulfilled ... is a link which the contractingparties decide to make between the contract concluded by them and a contingentfuture event; their agreement will be binding only if the latter occurs‘, and theconclusion it drew from that finding, namely that 'the admissibility of anapplication under the fourth paragraph of Article 173 of the Treaty cannot ... bemade to depend on the intention of the parties‘ (paragraph 54 of the judgmentappealed against).

30.

    The appellant submits that under the Court's case-law only the effect of thecontested decision on the 'legal or factual situation‘ of the applicant is relevant indetermining whether it is directly concerned by the decision, even if that effect islinked to an intentional act on the part of the parties prior to the contesteddecision.

31.

    The Commission challenges the admissibility of the appeal on the ground thatnearly all the arguments put forward merely reproduce arguments developed by theappellant before the Court of First Instance. It has consistently been held that anappeal which merely repeats or reproduces verbatim pleas and arguments alreadyraised at first instance does not satisfy the requirements of Article 51 of the ECStatute of the Court of Justice and Article 112(1)(c) of its Rules of Procedure.

32.

    As to the substance, the Commission observes as a preliminary matter that thecontractual clauses on which the appellant relies are far from clear and refutes theargument that, in the absence of approval by the Commission, the contractualobligation to pay came to an end. The contract at issue could only be interpretedby the competent jurisdiction, that is to say that chosen by the contracting partiesin the contract itself, namely the Moscow Chamber of Commerce and Industry. Dreyfus has never brought the matter before that body.

33.

    The Commission also cites Annex 25 to the application originating the proceedingsbefore the Court of First Instance, in which Dreyfus produced a fax which it sent

on 6 April 1993 to Exportkhleb and in which it pressed it for payment,notwithstanding the contested decision, in these terms:

'We trust you will understand that we consider we have with you a firm contract... and must insist on fulfilment of your obligations under the contract.‘

34.

    As regards the first limb of the first plea, the Commission considers that, for anaction for the annulment of a Commission decision to be admissible, the decisionmust produce effects in Community law with regard to the applicant, failing whichit is not directly concerned by the decision. The effect relied on by the appellantstems solely from the contractual clauses which it invokes.

35.

    As regards the second limb of the first plea and, in particular, the reference to thejudgment in International Fruit Company, cited above, the Commission observesthat in that case its refusal to issue import licences for dessert apples originatingin non-member countries had been notified to the applicant through theProduktschap voor Groenten en Fruit in The Hague. Thus, the legal effect of theCommission's decision on the applicants stemmed directly from that decision, evenif it was formally addressed to the Netherlands body.

36.

    In the present case, by contrast, the request for advance payments under the loangranted to the Russian Federation was apparently addressed to the Commission bythe VEB on behalf of Russia (and not Dreyfus) and the alleged effect was merelya result of a combination of the contested decision and the terms of the contract,to which the Commission is not a party.

37.

    As regards the third limb of the first plea the Commission considers that theargument that the contractual clause predated the contested decision is whollyirrelevant. Moreover, judicial review of its decisions cannot be subject toarrangements under private law to which the Commission is not a party.

38.

    As regards the objection of inadmissibility raised by the Commission, the appealclearly states which aspects of the contested judgment are criticised and the legalarguments which specifically support the appeal (see, in particular, the order of 26April 1993 in Case C-244/92 P Kupka-Floridi v Economic and Social Committee[1993] ECR I-2041, paragraph 9). Accordingly, the fact that those arguments werealso raised at first instance cannot entail their inadmissibility.

39.

    The objection of inadmissibility must therefore be dismissed.

40.

    Under the fourth paragraph of 173 of the Treaty, any natural or legal person mayinstitute proceedings for the annulment of a decision addressed to that person orof a decision which, although in the form of a decision addressed to anotherperson, is of direct and individual concern to the former.

41.

    In the present case the contested decision was formally addressed to the VEB.

42.

    The Court of First Instance dealt only with the question whether the applicant wasdirectly concerned by the contested decision, since the Commission had not deniedthat the applicant was individually concerned.

43.

    The Court's case-law shows that, for a person to be directly concerned by aCommunity measure, the latter must directly affect the legal situation of theindividual and leave no discretion to the addressees of that measure who areentrusted with the task of implementing it, such implementation being purelyautomatic and resulting from Community rules without the application of otherintermediate rules (see to that effect, in particular, International Fruit Company,cited above, paragraphs 23 to 29, Case 92/78 Simmenthal v Commission [1979]ECR 777, paragraphs 25 and 26, Case 113/77 NTN Toyo Bearing Company andOthers v Council [1979] ECR 1185, paragraphs 11 and 12, Case 118/77 ISO vCouncil [1979] ECR 1277, paragraph 26, Case 119/77 Nippon Seiko and Others vCouncil and Commission [1979] ECR 1303, paragraph 14, Case 120/77 Koyo Seikoand Others v Council and Commission [1979] ECR 1337, paragraph 25, Case 121/77Nachi Fujikoshi and Others v Council [1979] ECR 1363, paragraph 11, Joined Cases87/77, 130/77, 22/83, 9/84 and 10/84 Salerno and Others v Commission and Council[1985] ECR 2523, paragraph 31, Case 333/85 Mannesmann-Röhrenwerke andBenteler v Council [1987] ECR 1381, paragraph 14, Case 55/86 Arposol v Council[1988] ECR 13, paragraphs 11 to 13, Case 207/86 Apesco v Commission [1988]ECR 2151, paragraph 12, and Case C-152/88 Sofrimport v Commission [1990] ECRI-2477, paragraph 9).

44.

    The same applies where the possibility for addressees not to give effect to theCommunity measure is purely theoretical and their intention to act in conformitywith it is not in doubt (see to that effect Case 62/70 Bock v Commission [1971]ECR 897, paragraphs 6 to 8, Case 11/82 Piraiki-Patraiki and Others v Commission[1985] ECR 207, paragraphs 8 to 10, and Joined Cases C-68/94 and C-30/95 Franceand Others v Commission [1998] ECR I-0000, paragraph 51).

45.

    The Court of First Instance should therefore have determined whether thecontested decision alone affected the appellant's legal situation, since thecompetent Russian authorities had no discretion to forgo Community financing andhave the contract performed in accordance with the conditions agreed between theparties in the addendum but repudiated by the Commission.

46.

    The Court of First Instance merely found that the decision of the Commission,'which may only examine the conformity of contracts for the purposes ofCommunity financing‘, had not affected 'the legal validity of the commercialcontract concluded between the applicant and Exportkhleb‘ and did not modify'the terms of the contract, particularly as regards the prices agreed by the parties‘,and that the 'amendment which the parties made on 23 February 1993 to theircontract of 28 November 1992 [remained therefore] validly concluded on the terms

agreed between them‘ (paragraphs 51 and 53). It added that the presence in thecontract of a 'suspensory clause making performance of the contract and paymentof the contract price subject to acknowledgment by the Commission that thecriteria for disbursement of the Community loan are fulfilled‘ resulted from theintention of the parties themselves, on which the admissibility of an action underthe fourth paragraph of Article 173 could not be made to depend (paragraph 54).

47.

    However, the findings of the Court of First Instance contain objective, relevant andconsistent grounds for concluding that the appellant was directly concerned by thecontested decision.

48.

    The contested judgment indicates that the VEB, acting as financial agent for theRussian Federation, participated, in accordance with the Memorandum ofUnderstanding and the loan agreement which binds it to the Commission, in theimplementation of the Community financing of imports into the Russian Federationof agricultural and food products and medical supplies, as provided for in Decision91/658.

49.

    Moreover, it appears that the validity of the supply contract at issue was subject tothe suspensory condition of recognition by the Commission of conformity of thecontract with the conditions for disbursement of the Community loan and nopayment could be made if the bank designated in the contract did not receive adue undertaking for reimbursement issued by the Commission.

50.

    That detail is corroborated by the socio-economic context in which the supplycontract was concluded: as stated in the third and fourth recitals in the preambleto Council Decision 91/658, the economic and financial situation of the recipientrepublic was critical, and the food and medical situation was deteriorating. In thosecircumstances it was legitimate to take the view that the supply contract wasentered into only subject to the obligations assumed by the Community, in itscapacity as lender, in regard to the VEB, once the commercial contracts had beenrecognised as being in conformity with Community rules.

51.

    In those circumstances the insertion into the contract of that suspensory clause,which was certainly the intention of the parties, merely reflected, as wasemphasised by the Advocate General in point 69 of his Opinion, the fact that thesupply contract was subject for financial reasons to the conclusion of the loanagreement between the Community and the republic in question, since payment forsupplies of cereals could be made only from financial resources made available tothe purchasers by the Community by means of the opening of irrevocabledocumentary credits.

52.

    Exportkhleb's option to perform the supply contracts in accordance with the priceconditions repudiated by the Commission and thus to forgo Community financingwas purely theoretical and, in the light of the facts found by the Court of First

Instance, was therefore not sufficient to prevent the appellant from being directlyconcerned by the contested decision.

53.

    It is thus clear that the contested decision whereby the Commission, in the exerciseof its powers, refused to approve the addendum to the supply contract betweenExportkhleb and Dreyfus deprived the latter of any real possibility of performingthe contract awarded to it, or of obtaining payment for supplies made thereunder.

54.

    Consequently, although the contested decision was addressed to the VEB, asfinancial agent of the Russian Federation, it directly affected the appellant's legalsituation.

55.

    The Court of First Instance therefore erred in law in taking the view, in the lightof the facts as found by it, that the appellant was not directly concerned, within themeaning of the fourth paragraph of Article 173 of the Treaty, by the contesteddecision.

56.

    The appeal is therefore well founded in so far as it relates to the dismissal asinadmissible of the action for annulment by the contested judgment.

The second plea

57.

    In view of the foregoing there is no need to examine the second plea.

Referral back of the case to the Court of First Instance

Referral back to the Court of First Instance

58.

    Under the first paragraph of Article 54 of the EC Statute of the Court of Justice,'if the appeal is well founded, the Court of Justice shall quash the decision of theCourt of First Instance. It may itself give final judgment in the matter, where thestate of the proceedings so permits, or refer the case back to the Court of FirstInstance for judgment.‘

59.

    In the present case, the Court is of the view that it is not in a position to givejudgment in the present state of the proceedings and that the case must thereforebe referred back to the Court of First Instance for judgment on the substance.

On those grounds,

THE COURT

hereby:

1.    Annuls the judgment of the Court of First Instance of 24 September 1996in Case T-485/93 Dreyfus v Commission in so far as it dismisses asinadmissible the action for annulment brought by Louis Dreyfus & C^ie;

2.    Refers the case back to the Court of First Instance for judgment on thesubstance;

3.    Reserves costs.

Rodríguez IglesiasGulmann Ragnemalm Wathelet Schintgen Mancini Moitinho de Almeida Kapteyn Murray Edward Puissochet Hirsch Jann Sevón Ioannou

Delivered in open court in Luxembourg on 5 May 1998.

R. Grass

G.C. Rodríguez Iglesias

Registrar

President

1: Language of the case: French.