JUDGMENT OF THE COURT OF FIRST INSTANCE (Fourth Chamber)

1 October 1998 (1)

(Inland waterway transport — Structural improvements — Conditions for bringingnew vessels into service — Exclusion)

In Case T-155/97,

Natural van Dam AG, a company incorporated under Swiss law, established inBasle (Switzerland),

Danser Container Line BV, a company incorporated under Dutch law, establishedat Sliedrecht (Netherlands),

represented by Marius J. van Dam, of the Rotterdam Bar, with an address forservice in Luxembourg at the Chambers of Fernand Entringer, 34A Rue PhilippeII,

applicants,

v

Commission of the European Communities, represented initially by Berend-JanDrijber, and subsequently by Laura Pignataro and Maurits Lugard, of its LegalService, acting as Agents, with an address for service in Luxembourg at the officeof Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre, Kirchberg,

defendant,

APPLICATION for annulment of Commission Decision SG(97) D/1862 of 7 March1997 refusing to grant the applicants, in respect of three vessels which they plannedto build, the exemption applied for under Article 8(3)(c) of Council Regulation(EEC) No 1101/89 of 27 April 1989 on structural improvements in inland waterwaytransport (OJ 1989 L 116, p. 25),

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (Fourth Chamber),

composed of: P. Lindh, President, K. Lenaerts and J.D. Cooke, Judges,

Registrar: A. Mair, Administrator,

having regard to the written procedure and further to the hearing on 14 May 1998,

gives the following

Judgment

Facts

1.

    The aim of Council Regulation (EEC) No 1101/89 of 27 April 1989 on structuralimprovements in inland waterway transport (OJ 1989 L 116, p. 25; 'theRegulation‘) is to reduce the carrying overcapacity manifest in all sectors of theinland waterway transport market. To that end, provision is made for a scrappingscheme coordinated at Community level, together with supporting measures. Under the 'old for new‘ rule, the owner of a new vessel must, if it is to be broughtinto service, scrap a tonnage of carrying capacity equivalent to the new vesselwithout receiving a scrapping premium. Where the owner scraps no vessel, hemust pay a special contribution into the Fund covering his new vessel, establishedfor that purpose (Article 8(1) of the Regulation).

2.

    Article 8(3)(c) of the Regulation makes provision for 'specialised vessels‘ to beexempted from that general scheme.

3.

    On 7 December 1990, after consulting the Member States and organisationsrepresenting the inland waterway sector, the Commission drew up a note layingdown general criteria for the appraisal of applications for the exemption ofspecialised vessels from the Regulation ('the explanatory note‘).

4.

    That note states that an exemption may be granted only if the three followingconditions are concurrently satisfied:

—    the vessel must be specially designed to carry a specified category of goodsand it must be unsuitable on technical grounds (without undergoingstructural conversion) for the carriage of other goods;

—    carriage of the goods in question must be possible or permissible only onvessels which are specially fitted;

—    the owner of the specialised vessel must give a written undertaking that noother goods will be carried by his vessel so long as the 'old for new‘ ruleapplies and he must declare that he is prepared to pay the special 'old fornew‘ contribution if, for whatever reason, he wishes to use his vessel tocarry other goods while the above rule is in force.

5.

    Natural van Dam AG and Danser Container Line BV ('the applicants‘), whichoperate a container line on the Rhine, planned to have three specialised vesselsbuilt for the carriage of containerised dangerous substances, under either the Swissflag or that of a Member State.

6.

    On 5 July 1996 they applied to the Commission for exemption under Article 8(3)(c)of the Regulation.

7.

    In support of their application, they emphasised the advantages, both for the inlandwaterway transport market and for general transport policy — under which it issought to alleviate road-transport congestion — of developing the waterwaytransport of dangerous substances by specialised vessels which are not subject tobulking restrictions. They maintained that payment of the contribution providedfor by the Regulation would render their project no longer economically orcommercially viable and would consequently bring about a result quite opposite tothat anticipated by the general transport policy.

8.

    The applicants also listed the technical specifications, designed to meet safetyrequirements, of the vessels in question, drawing attention to the financialcommitment which these entail. In their view, the significance of the investmentjustifies exemption from payment of the 'old for new‘ contribution.

9.

    Lastly, the applicants submitted that these specialised vessels would remain inservice for the carriage of other containerised cargo, which is normally transportedby conventional vessels.

10.

    On 25 October 1996 the Member States and the organisations representing inlandwaterway navigation were consulted in accordance with the procedure provided forin Article 8(3)(c) of the Regulation.

11.

    Following those consultations, the Commission informed the applicants by letter of7 March 1997 (SG(97) D/1862; 'the contested decision‘) of its refusal to grant theexemption sought.

12.

    Referring to the conditions set out in its explanatory note, the Commission pointedout, first, that the three vessels in question were technically suited for the carriageof goods other than dangerous substances and, second, that such substances couldbe transported by conventional vessels meeting the technical specifications laiddown in the regulation on the carriage of dangerous substances on the Rhine ('theADNR‘).

13.

    The Commission concluded that the effect of bringing the vessels in question intoservice would be to increase the capacity of the fleet to which the structuralimprovement measures apply. Those vessels could not therefore be regarded as'specialised‘ within the meaning of Article 8(3)(c) of the Regulation.

Procedure and forms of order sought

14.

    By application lodged at the Registry of the Court of First Instance on 7 May 1997,the applicants brought an action for annulment of the contested decision.

15.

    Upon hearing the report of the Judge-Rapporteur, the Court of First Instance(Fourth Chamber) decided to open the oral procedure without ordering apreparatory inquiry. However, pursuant to Article 64 of the Rules of Procedure,the applicants were asked to provide the Court with a copy of the ADNR. Theycomplied with that request.

16.

    The parties presented oral argument and replied to questions from the Court at thehearing on 14 May 1998.

17.

    The applicants claim that the Court should:

—    annul the contested decision;

—    order the Commission to pay the costs.

18.

    The defendant contends that the Court should:

—    dismiss the action;

—    order the applicants to pay the costs.

Substance

19.

    In support of their action, the applicants put forward numerous arguments, whichmay be grouped under two pleas in law: (i) infringement of Regulation No 1101/89and (ii) breach of the obligation to state reasons.

The first plea in law: infringement of Regulation No 1101/89

Arguments of the parties

20.

    The applicants maintain that their vessels are specialised within the meaning ofArticle 8(3)(c) of the Regulation and therefore qualify for exemption from the 'oldfor new‘ rule.

21.

    In support of that submission, the applicants put forward four arguments.

22.

    First, according to the applicants, the Commission has failed in the contesteddecision to take a correct approach in its examination of the objective pursued bythe Regulation which, far from seeking to curb the diversion of cargo from theroads to the inland waterways, seeks to develop that alternative. In support of thatassertion, the applicants rely on the second recital in the preamble to theRegulation, which states that the share of the total transport market taken byinland waterway transport is continuing to decline as a result of progressive changesin the basic industries supplied mainly by inland waterway. The applicants arguethat the three vessels would have contributed to the creation of a transport sectorcovering specific dangerous substances which, being new, would not have sufferedfrom the overcapacity which the Regulation aims to reduce. They conclude that,on the basis of a purposive construction of Article 8(3)(c) of the Regulation, theirvessels should have qualified for exemption.

23.

    Secondly, the applicants dispute the Commission's argument that their vessels'capability of carrying other cargo precludes them from being classified asspecialised vessels. According to the applicants, that capability would lead to thedevelopment of a new branch of the river transport market — the transport ofcontainerised dangerous substances — which would not suffer from structuralovercapacity and would enable inland waterway transport to capture a new shareof the general transport market.

24.

    Thirdly, the applicants challenge the Commission's assertion that the three vesselswould contribute to increasing the capacity of the fleet. On that point, theyreiterate their arguments concerning the Regulation's objective, pointing out thatthe three vessels would have formed the basis for a new logistical concept, fromwhich a specific market in container transport would arise. A new market of thatnature would ensure the future of waterway transport, providing a substitute for theroad transport currently used. The applicants add that, contrary to theCommission's contentions, their vessels would therefore have provided new

competitive capacity which would not increase the capacity of their fleets in othersectors.

25.

    Fourthly, the applicants maintain that their vessels' technical characteristics and thefact that they complied with the ADNR (Annex B1, point 10111 et seq., and point10400 et seq. to the ADNR) clearly revealed their specialised nature. It is clearfrom the ADNR that, in the present case, the materials at issue are not dangeroussubstances in general, but specific dangerous substances which require for theirtransport vessels custom-built to particular technical specifications.

26.

    Thus the applicants' vessels belong to a special category under the ADNR. Theapplicants dispute the Commission's assertion that the special character of vesselsis not an implied condition for applying or complying with the ADNR, andmaintain that in order to make the contemplated carriage of specific dangeroussubstances on inland waters commercially viable, special techniques are used in theconstruction of the vessels in question which are not applied to conventionalvessels. Furthermore, the specialised nature of the three vessels concerned ischaracterised both by those special construction techniques and by the fact that thebulking prohibitions laid down in the ADNR do not apply to them.

27.

    The Commission contends that none of those arguments is relevant since they allrun counter to the objective set by the Regulation which is to reduce structuralovercapacity in the inland waterway transport sector. The vessels in question donot meet any of the three concurrent conditions for exemption laid down in theexplanatory note. The Commission points in particular to the fact that the vesselswere to be used for the transport of several types of goods. Lastly, according tothe Commission, it cannot follow from the fact that vessels comply with the ADNRthat they are specialised vessels within the meaning of Article 8(3)(c) of theRegulation, since the ADNR applies across the board to all vessels used for thetransport of dangerous substances.

Findings of the Court

28.

    Article 1 of Regulation No 1101/89 provides:

'1.    Inland waterway vessels used to carry goods between two or more points byinland waterway in the Member States shall be subject to measures for structuralimprovements in inland waterway transport under the conditions laid down in thisRegulation.

2.    The measures referred to in paragraph 1 shall comprise:

—    the reduction of structural overcapacity by means of scrapping schemescoordinated at Community level,

—    supporting measures to avoid aggravation of existing overcapacity or theemergence of further overcapacity‘.

29.

    That provision must be construed in the light of the second and sixth recitals in thepreamble to the Regulation, according to which:

'[w]hereas forecasts show no sign of sufficient increase in demand in this sector toabsorb this overcapacity in the next few years; whereas in fact the share of the totaltransport market taken by inland waterway transport is continuing to decline as aresult of progressive changes in the basic industries supplied mainly by inlandwaterway;

[...]

[w]hereas overcapacity generally affects every sector of the inland waterwaytransport market; whereas the measures to be adopted must, therefore, begenerally applicable and cover all cargo vessels and pusher craft; [...]‘.

30.

    Article 8(3)(c) of the Regulation provides:

'The Commission may, after consulting the Member States and the organisationsrepresenting inland waterway transport at Community level, exempt specialisedvessels from the scope of paragraph 1‘.

31.

    Since Article 8(3)(c) provides for a derogation from the rules generally applicable,it must be narrowly construed, having regard to the aim of the Regulation.

32.

    The applicants maintain that they qualify for exemption because the Regulationdoes not preclude the bringing into service of new vessels operating in a newbranch of the inland waterway transport market, namely the carriage ofcontainerised dangerous substances. That mode of transport constitutes a newform of supply which does not aggravate the existing overcapacity in the inlandwaterway market.

33.

    However, the applicants have confirmed throughout the proceedings that thevessels in question were intended for the carriage not only of dangerous substances,but also of other goods (see paragraph 9 above). At the hearing, the applicantseven explained that they intended to transport other goods because the transportof containerised dangerous substances alone is not economically viable.

34.

    It is therefore clear from the explanations given by the applicants that their vesselswould have contributed to the increase in carrying capacity of the fleets used forthe transport of other goods, a sector which already suffers from overcapacity. Consequently, the bringing of those vessels into service would have run counter tothe objectives of the Regulation.

35.

    In that connection, it is irrelevant that the vessels in question operate in a separatebranch of the inland waterways transport market, namely the container transportmarket. For the new vessels to qualify for exemption under Article 8(3)(c) of theRegulation, having regard to the scheme and purpose of that piece of legislation,they must not contribute to the increase in carrying capacity for goods which maybe transported by other vessels already operating on the inland waterways market. The Court must therefore consider that market as a whole in order to determinewhether the bringing into service of a new vessel aggravates existing overcapacityin the sector.

36.

    The applicants' argument that their vessels would have helped to alleviatecongestion of road transport and to increase the competitive potential of the inlandwaterways does nothing to invalidate the conclusion that the bringing of theapplicants' vessels into service would have run counter to the Regulation'sobjective. It is clear from the applicants' explanations during the written procedureand, in particular, from their statement that their vessels would have been able totransport other goods covered by the inland waterways market (see paragraphs 33and 34 above), that their plan to bring those vessels into service was not for thesole purpose of alleviating congestion of road transport. In those circumstances,decongestion of road transport, although a legitimate objective in itself, could notjustify an operation which would have the effect of aggravating existingovercapacity.

37.

    Lastly, as regards the applicants' arguments to the effect that the fact that thevessels in question comply with the requirements of the ADNR means that they arespecialised vessels, it should be noted that the safety rules and technical conditionslaid down by the ADNR are binding to a greater or lesser extent, depending on thenature and physical properties of the substances carried, on all vessels to be usedfor the transport of dangerous substances. For the purposes of the ADNR, theexpression 'dangerous substances‘ covers all objects and materials the lawfultransport of which is subject to certain conditions.

38.

    Consequently, notwithstanding the fact that the construction of the vessels inquestion would have satisfied certain strict requirements laid down in the ADNR,they were not specialised vessels within the meaning of Article 8(3)(c) of theRegulation.

39.

    Their compliance with the requirements laid down by the ADNR is thereforeirrelevant to the outcome of the present dispute.

40.

    Furthermore, it is clear from the explanations supplied by the applicants thatcompliance with the strict technical requirements laid down by the ADNR wouldhave enabled the vessels in question to escape the bulking prohibitions. Thosevessels would therefore have been authorised to carry several types of goods at thesame time, so that they would have been liable to aggravate the existingovercapacity in the river transport sector.

41.

    It follows that the Commission quite legitimately took the view that the vessels inquestion did not qualify for exemption, in view particularly of the applicants'intention to use them to transport goods other than those for which they had beenspecially designed.

42.

    It follows from all the above considerations that the first plea in law must berejected.

The second plea in law: breach of the obligation to state reasons

Arguments of the parties

43.

    The applicants criticise the Commission's examination of the vessels' technicalcharacteristics on the ground that it is not exhaustive. In taking the view that thebringing of the three vessels into service would contribute to the increase in thefleet's carrying capacity, the Commission did not take into account the benefits toinland waterway transport of capturing a new market hitherto held by roadtransport.

44.

    Furthermore, the Commission did not mention the views of the Member States orthe organisations concerned. Furthermore, according to the applicants, the factson which the Member States and the said organisations based their appraisal wereinaccurate. Contrary to the Commission's assertion, the dangerous substancesconcerned cannot be transported by conventional vessels which are not speciallyfitted.

45.

    The Commission disputes those arguments. In particular, it maintains that therefusal to grant the applicants an exemption is justified solely on the ground thatthe three vessels would have been technically suited to the transport of other goods,a point expressly made in the contested decision.

46.

    Furthermore, the opinions of the Member States and the organisations concerned— which in any case are not binding — amply support the contested decision.

Findings of the Court

47.

    The purpose of the obligation to state reasons for a decision affecting a person isto enable the Community judicature to exercise its power of review as to thelegality of the decision and to enable the person concerned to ascertain the mattersjustifying the measure adopted, so that he can defend his rights and verify whetherthe decision is well founded (see, in particular, Case 8/83 Bertoli v Commission[1984] ECR 1649, paragraph 12; Case T-44/90 La Cinq v Commission [1992] ECR

II-1, paragraph 42; and Case T-7/92 Asia Motor France and Others v Commission[1993] ECR II-669, paragraph 30).

48.

    Thus the Commission is not under a duty, when stating reasons for its decisions, totake a position on every argument relied upon by the parties concerned in supportof their case. It is sufficient to set out the essential facts and legal considerationsunderpinning the decision.

49.

    In the contested decision the Commission referred to the vessels' principalcharacteristics and to their technical capability of transporting other goods, factswhich in the Commission's view justify the decision in the light of the explanatorynote.

50.

    The Commission therefore gave sufficient reasons in law for its refusal to classifythe vessels in question as specialised vessels within the meaning of Article 8(3)(c)of the Regulation.

51.

    Furthermore, the applicants cannot reproach the Commission for not indicating theviews of the Member States or the organisations concerned. It is clear from Article8(3)(c) of the Regulation and from the thirteenth recital in the preamble theretothat the role of the Member States and the organisations representing inlandwaterways transport is consultative. Consequently, the Commission is not requiredto adopt the position taken by them. Since their point of view carries the weightof an opinion, the fact that the Commission takes a different approach cannot castdoubt on the validity of its decision. That being so, the Commission was notrequired to give the applicants details of the point of view expressed by theMember States or the organisations concerned.

52.

    It follows that the contested decision is not vitiated by any inadequacy in thestatement of reasons.

53.

    The second plea in law must therefore be rejected.

54.

    It follows from all the above considerations that the application must be dismissedin its entirety.

Costs

55.

    Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to beordered to pay the costs if they have been applied for in the successful party'spleadings. Since the applicants have been unsuccessful, they must be ordered topay the costs, as applied for by the Commission.

On those grounds,

THE COURT OF FIRST INSTANCE (Fourth Chamber)

hereby:

1.    Dismisses the application;

2.    Orders the applicants to pay the costs.

LindhLenaerts Cooke

Delivered in open court in Luxembourg on 1 October 1998.

H. Jung

P. Lindh

Registrar

President

1: Language of the case: Dutch.

ECR