ORDER OF THE PRESIDENT OF THE COURT OF FIRST INSTANCE
21 January 2004 (1)

(Interim proceedings – Competition – Payment of a fine – Bank guarantee – Prima facie case – Urgency – Balance of interests – Partial and conditional suspension)

In Case T-217/03 R,

Fédération nationale de la Coopération Bétail et viande (FNCBV), established in Paris (France), represented by R. Collin and M. Ponsard, lawyers, with an address for service in Luxembourg,

applicant,

supported by

French Republic, represented by G. de Bergues and F. Million, acting as Agents, with an address for service in Luxembourg,

intervener,

v

Commission of the European Communities, represented by P. Oliver and O. Beynet, acting as Agents, with an address for service in Luxembourg,

defendant,

APPLICATION for dispensation from the obligation to provide a bank guarantee in order to avoid enforcement of the fine of EUR 480 000 imposed by Commission Decision 2003/600/EC of 2 April 2003 relating to a proceeding pursuant to Article 81 of the EC Treaty (Case COMP/C.38.279/F3 – French beef) (OJ 2003 L 209, p. 12),

THE PRESIDENT OF THE COURT OF FIRST INSTANCE
OF THE EUROPEAN COMMUNITIES,

makes the following

Order

Facts and procedure

1

By Decision 2003/600/EC of 2 April 2003 relating to a proceeding pursuant to Article 81 of the EC Treaty (Case COMP/C.38.279/F3 – French beef) (OJ 2003 L 209, p. 12, hereinafter the ‘decision’) the Commission found that the applicant had infringed Article 81(1) EC by participating – with the Fédération Nationale de l’Industrie et des Commerces en Gros des Viandes (FNICGV), which like the applicant represents cattle slaughterers, and with four federations representing farmers, namely the Fédération Nationale des Syndicats d’Exploitants Agricoles (FNSEA), the Fédération Nationale Bovine (FNB), the Fédération Nationale des Producteurs de Lait (FNPL) and the Jeunes Agriculteurs (JA) – in an agreement aimed at suspending beef imports into France and setting a minimum purchase price for certain categories of beef (Article 1 of the decision).

2

It is apparent from the decision that on 24 October 2001, during a crisis caused by bovine spongiform encephalopathy (BSE), termed a ‘mad cow crisis’, the applicant and the FNICGV on the one hand and the FNSEA, the FNB, the FNPL and the JA on the other reached an agreement under which they set minimum prices and undertook to suspend or at least to limit beef imports into France. At the end of November and the beginning of December 2001 the same federations allegedly concluded a verbal agreement with a similar purpose.

3

In the decision the Commission considers that the conclusion of these two agreements (hereinafter the ‘disputed agreements’) constitutes a serious infringement of Article 81 EC. It imposes a fine of EUR 480 000 on the applicant (Article 3 of the decision).

4

Article 4 of the decision lays down that the fine is payable within three months of the date of notification of the decision. The letter of notice, dated 9 April 2003, stated that if the applicant brought an action before the Court of First Instance the Commission would take no recovery measure, provided that the claim bore interest from the date of expiry of the payment period and that an acceptable bank guarantee were provided by that date at the latest.

5

By application lodged at the Registry of the Court of First Instance on 19 June 2003, the applicant instituted proceedings under the fourth paragraph of Article 230 EC for the annulment of the decision and, in the alternative, for the cancellation or reduction of the fine.

6

By a separate document lodged at the Registry of the Court of First Instance on 2 July 2003, the applicant sought interim measures dispensing it from the obligation to provide the bank guarantee imposed as a condition for avoiding the immediate recovery of the amount of the fine imposed by the decision.

7

The Commission submitted its written observations on the application for interim measures on 17 July 2003.

8

By application lodged at the Registry on 7 October 2003, the French Republic applied to intervene in support of the form of order sought by the applicant. By order of 14 October 2003 the President of the Court of First Instance granted the French Republic leave to intervene and requested it to present its observations at the hearing.

9

In the light of the observations of the Commission, the President of the Court of First Instance authorised the applicant to produce certain additional documents, which were lodged at the Registry of the Court of First Instance on 16 October 2003.

10

The hearing before the President of the Court of First Instance was held on 17 October 2003.

11

At the hearing the parties undertook to examine the possibility of an agreed staggering of payment of the fine and to inform the President of the Court of First Instance of the outcome of their discussions. The parties notified the outcome of these discussions and certain related documents on 7 November 2003.

Law

12

By virtue of the combined provisions of Articles 242 EC and 243 EC on the one hand and Article 225(1) EC on the other, the Court of First Instance may, if it considers that circumstances so require, order that application of the contested act be suspended or prescribe any other necessary interim measures.

13

Under Article 104(2) of the Rules of Procedure of the Court of First Instance, an application for interim measures must state the circumstances giving rise to urgency and the pleas of fact and law establishing a prima facie case for the interim measures applied for. Those conditions are cumulative, so that an application for interim measures must be dismissed if any one of them is absent (order of the President of the Court of Justice in Case C‑268/96 P(R) SCK and FNK v Commission [1996] ECR I‑4971, paragraph 30). Where appropriate, the judge hearing such an application must also weigh up the interests involved (order of the President of the Court of Justice in Case C‑445/00 R Austria v Council [2001] ECR I‑1461, paragraph 73).

Arguments of the parties

The existence of a prima facie case

14

In order to demonstrate that the condition for the existence of a prima facie case is met, the applicant submits two pleas concerning procedure and four substantive pleas with a view to annulment of the decision.

15

As regards the pleas concerning procedure, the applicant claims infringement of the rights of the defence and infringement of essential procedural requirements owing to the failure to provide reasons in the statement of objections and in the decision on not exceeding the ceiling of 10% of turnover in determining the amount of the fine.

16

As to the substantive pleas, the applicant contends first that the Commission committed a manifest error of appraisal in that it did not demonstrate that a vertical agreement existed between the various federations of farmers and slaughterers after 30 November 2001. According to the applicant, the Commission relied solely on the statements of the farmers’ federations without producing evidence from slaughterers’ federations confirming their participation in this alleged agreement. Moreover, the Commission failed to analyse developments in market prices subsequent to 30 November 2001.

17

Secondly, the applicant maintains that the Commission committed a manifest error of appraisal in considering that the disputed agreements had a measurable effect on competition. In fact, according to the applicant, the Commission itself acknowledged that no such effect occurred during the period of the written agreement of 24 October 2001 and did not demonstrate that there were any effects after the cessation of that agreement. Furthermore, in the applicant’s view the Commission’s assessment that the purpose of the agreement of 24 October was anti-competitive disregarded the context of the crisis in which the agreement was concluded.

18

Thirdly, according to the applicant the Commission committed an error of assessment by concluding that Article 2 of Council Regulation No 26 of 4 April 1962 applying certain rules of competition to production of and trade in agricultural products (OJ, English Special Edition 1959-1962 (II), p. 129) was not applicable in the present case. Contrary to the Commission’s contention, the applicant maintains that the agreement did not contravene the objectives of Article 33 EC, as it made it possible, in particular, to ensure a fair standard of living for the farming population and to stabilise markets.

19

Lastly, the applicant maintains that the Commission infringed Article 15(2) of Council Regulation No 17 of 6 February 1962, First Regulation implementing Articles [81] and [82] of the Treaty (OJ, English Special Edition 1959-1962 (I), p. 87), in that it gave no information on the turnover used in determining the fine and did not check whether the amount of the fine was within the limit of 10% of the applicant’s turnover.

20

In the alternative, the applicant maintains that the fine imposed should be quashed or reduced. It contends in this regard that the Commission infringed Point 5(b) of the Guidelines on the method of setting fines imposed pursuant to Article 15(2) of Regulation No 17 and Article 65(5) of the ECSC Treaty (OJ 1998 C 9, p. 3). In addition, according to the applicant, the Commission infringed Article 15(2) of Regulation No 17 by fixing the applicant’s fine at EUR 480 000. Finally, in the view of the applicant the Commission committed a manifest error of appraisal and law, first in characterising the applicant’s conduct as a ‘very serious’ infringement, secondly when taking account of extenuating circumstances, thirdly in its assessment of the secret nature of the agreement and fourthly in ascertaining the duration of the agreement, which expired on 30 November 2001 and not on 11 January 2002.

21

The Commission considers that none of the pleas submitted by the applicant meets the condition for the existence of a prima facie case.

22

It observes that the plea regarding the failure to provide reasons in the statement of objections and the pleas seeking the annulment or reduction of the fine are too general and can be understood only in the light of the pleadings in the main proceedings. As they do not meet the criteria set out in the order of the President of the Court of First Instance in Aden and Others v Council and Commission (Case T‑306/01 R [2002] ECR II‑2387, paragraph 52), they should be dismissed as inadmissible.

23

The Commission contends that the other pleas are unfounded in law.

Urgency

24

The applicant considers that the condition as regards urgency is met in the present case. It points out that its financial situation is such that it is unable to furnish a bank guarantee for the amount of the fine plus interest.

25

The applicant observes first that, in accordance with Article 2 of its articles of association, its object is primarily to provide intellectual and professional support for agricultural collective-interest companies, co‑operatives, groupings of cattle and meat producers and the subsidiaries of such bodies and to represent its members in relation to public authorities and various professional and interprofessional organisations. Hence it does not engage primarily in any activity likely to generate income and, in accordance with Article 6 of its articles of association, its financial resources consist of subscriptions from its members and the grants it receives, mainly from the State, départements or municipalities.

26

It states that in 2002 it had an operating income of EUR 1.84 million. This income came mainly from members’ subscriptions (EUR 716 987), various grants received (EUR 331 408), the apprenticeship tax (EUR 140 099) and annual research agreements (EUR 321 292). It points out that its operating expenses in 2002 amounted to EUR 1.84 million, which enabled it to achieve an operating profit of EUR 3 306 and a net profit of EUR 921 in the 2002 financial year.

27

The applicant asserts that it can also be seen from the 2002 balance sheet that it held own funds of EUR 162 980. The provisional budget for 2003 foresees an operating loss of EUR 197 000, which would reduce its own funds.

28

The applicant also produces two letters from two French banks, dated 11 and 13 June 2003, in which the latter notify their refusal to provide a bank guarantee. The letter dated 13 June 2003 states that the amount sought greatly exceeds the applicant’s own funds and that the annual results for the last three financial years do not hold out the prospect that they will increase over the medium term.

29

According to the applicant, the gravity of its financial situation is also confirmed by two letters from its auditor, dated 26 May and 19 June 2003, from which it transpires that in view of uncertainty about the continued operation of the applicant the auditor had had to initiate the first stage of a ‘warning procedure’ in accordance with the French Commercial Code.

30

The applicant asserts that its inability to furnish the requisite bank guarantee is all the more evident from the fact that it is a federation organised in the form of an association. In contrast to a group of companies, there are no capital links between the federation and its members. Its situation is therefore different from that which gave rise to the case-law of the Court of First Instance on the power of a company from the same group to rectify the inability of the accused company to furnish a bank guarantee by doing so in the latter’s stead.

31

Furthermore, as its articles of association do not permit it to bind its members, its members cannot be held liable for its actions.

32

The Commission considers that the applicant has not proved satisfactorily that the condition as to urgency is met in the present case.

33

It observes first that the documents provided by the applicant to justify its financial difficulties are of little evidential value. In fact, the tax form relating to its accounts for the 2002 financial year is, according to the Commission, simply a tax return and not a statement certified by the auditor. As for the 2003 budget, it is submitted on unstamped paper, without any author’s signature or auditor’s endorsement.

34

Even supposing that the figures presented by the applicant are correct, in the view of the Commission the applicant has not in any way explored the possibility of its members’ assisting it in providing a bank guarantee. The estimates provided by the applicant to the Commission show that the turnover of the member undertakings in the cattle sector is EUR 1.475 billion. It is therefore clear, according to the Commission, that with the help of its members the applicant would be able to pay the fine or provide the necessary bank guarantee.

35

As regards the financial links between the applicant and its members and the argument that the applicant has no possibility of holding them liable, the Commission points to Article 16 of the applicant’s articles of association, which provides that in the event of liquidation any net liability will be met by the associated members in proportion to the subscriptions paid or remaining payable over the previous five years. Hence, if the fine were not paid and the applicant were liquidated, the Commission could turn to its members for payment of the fine. Consequently, in the opinion of the Commission the applicant cannot legitimately maintain that its debts are of no concern to its members.

36

Furthermore, according to the Commission it is clear that the applicant exists only in the interests of its members and that it concluded the disputed agreements on behalf of and in the interests of its members.

37

The Commission contends that if the applicant’s members decided not to provide the bank guarantee and if recovery by order of the court led to its demise, that consequence would be ascribable not to the obligation imposed by the Commission but to the decision of those members. In those circumstances, there would be no direct and necessary causal link between the applicant’s demise and the Commission’s action (order of the President of the Court of First Instance in Case T‑18/96 R SCK and FNK v Commission [1996] ECR II‑407, confirmed upon appeal by order of the President of the Court of Justice in Case C‑268/96 P(R) SCK and FNK v Commission, cited above; order of the President of the Court of First Instance in Case T‑5/00 R Nederlandse Federatieve Vereniging voor de Groothandel op Elektrotechnisch Gebied v Commission [2000] ECR II‑4121, confirmed upon appeal by order of the President of the Court of Justice in Case C‑7/01 P(R) FEG v Commission [2001] ECR I‑2559).

The balance of interests

38

The Commission points out first that according to the budget for the 2003 financial year presented by the applicant the latter’s assets are declining, so that the financial risk to the Community is becoming ever greater. Moreover, given that the applicant’s continued activity depends on the intentions of its members, in the Commission’s view there is a risk that the latter will reduce their subscriptions so that the Commission cannot recover the fine. If the applicant were placed in liquidation, the Commission would have to attempt to recover the fine from each member in proportion to its subscriptions, which would entail costs, delays and increased risks.

39

More generally, the Commission points out that if, because their own financial resources were modest, associations of undertakings could be exempted from providing a bank guarantee without the financial resources of their members being taken into account, undertakings contemplating anti-competitive behaviour would always have an interest in forming an association of undertakings to conclude agreements contrary to competition law.

40

Lastly, in the opinion of the Commission the need to safeguard the effectiveness of Community competition rules and their deterrent effect is all the more important in the present case in that the applicant was involved in a very serious infringement of Community competition rules (order of the President of the Court of First Instance of 28 June 2000 in Case T‑191/98 R II Cho Yang Shipping v Commission [2000] ECR II‑2551, paragraph 54).

Assessment by the President of the Court of First Instance

The existence of a prima facie case

41

It must be acknowledged that at least some of the pleas relied upon by the applicant appear prima facie to be relevant and in any case not entirely without substance. That is true, first, of the plea that the Commission set a fine that exceeded the ceiling of 10% of the applicant’s turnover and, secondly, of the plea that the decision lacks a statement of reasons with regard to the said ceiling.

42

As to the first of these two pleas, it must be noted that under Article 15(2) of Regulation No 17 the fines imposed by the Commission on undertakings and associations of undertakings pursuant to Articles 81 EC and 82 EC may not in any event exceed 10% of the turnover in the preceding business year.

43

In the case of an association of undertakings, the turnover to be taken into account must be calculated, where appropriate, by reference to the turnover achieved by all of its member undertakings, at least where, by virtue of its internal rules, the association is able to bind its members (judgments in Joined Cases T‑39/92 and T‑40/92 CB and Europay v Commission [1994] ECR II‑49, paragraph 136, Case T‑29/92 SPO and Others v Commission [1995] ECR II‑289, paragraph 385, Joined Cases T‑213/95 and T‑18/96 SCK and FNK v Commission [1997] ECR II‑1739, paragraph 252, and Case T-338/94 Finnboard v Commission [1998] ECR II‑1617, paragraph 270, confirmed upon appeal by the judgment in Case C‑298/98 P Finnboard v Commission [2000] ECR I‑10157, paragraph 66).

44

It must be found that in the present case the amount of the fine imposed on the applicant represents approximately 25% of its operating income, which amounted to EUR 1.84 million in 2002 (see paragraph 26 above). On the assumption that the applicant’s turnover consisted solely of this operating income, the amount of the fine imposed thus greatly exceeds the ceiling of 10% laid down in Regulation No 17.

45

At the hearing the Commission observed that the applicant’s articles of association, and in particular Articles 2, 4, 5, 12 and 16, showed that the applicant had the power to bind its members and that consequently it was justified to take into account the turnover of all of the applicant’s member undertakings.

46

In reply, the applicant disputed that its articles of association permit it to bind its members. It also observed at the hearing that several local agreements were concluded, which in its view demonstrated that the agreement of 24 October 2001 was not restrictive. As to Article 16 of the articles of association, the applicant pointed out that this provision dealt solely with the situation in which the dissolution or liquidation of the association was decided by the general meeting and hence did not apply to dissolution of the association in the context of liquidation proceedings initiated by the court.

47

It must be found that, in accordance with Article 2 of the applicant’s articles of association, the applicant’s object is primarily to provide intellectual and professional support to its members (paragraph 1), to represent its members in relation to public authorities and various professional and interprofessional organisations (paragraph 2), to promote the development of a cooperative sector for organising the production, preparation and sale of cattle, meat and their products and by-products within the framework of the general organisation of the meat market (paragraph 3), to arbitrate in disputes about the respective spheres of influence of its internal organisations (paragraph 4), to facilitate the organisation and operation of companies and unions by providing advice or qualified experts to its members (paragraph 5) and to facilitate and assist the creation of federations or unions at the level of regions or départements (paragraph 6).

48

Furthermore, Article 4 of the articles of association provides that ‘membership of the [FNCBV] entails a commitment to comply with these articles of association and with any internal rules that may be laid down by the board of directors’.

49

Under Article 5 of the articles of association, ‘the board of directors may expel any cooperative or grouping that fails to comply with these articles of association or whose activity is likely to harm the interests of the [FNCBV]’.

50

Article 12 of the articles of association reads as follows:

‘The board of directors represents the [FNCBV] in relation to third parties. … It represents the member organisations in relation to public authorities and professional organisations as regards the economic and social positions agreed previously by the member groupings. The said groupings shall be held liable only if they have not opposed such liability in advance’.

51

Finally, under Article 16 of the articles of association:

‘Dissolution, liquidation or merger with another association may be decided only by a general meeting at which at least two-thirds of the associated members are present or represented. … If at the time of liquidation there is a net asset position, it shall be transferred compulsorily to a national project of benefit to the agricultural co-operative sector. If there is a liability, it shall be met by the associated members in proportion to the subscriptions paid or remaining payable over the previous five years’.

52

It must also be recalled that in the judgments in CB and Europay v Commission, cited above, and in Case T‑338/94 Finnboard v Commission, cited above, it was stated that the associations in question could bind their members towards third parties, for example by concluding sales agreements on behalf of their members, and that by virtue of the articles of association of the said associations their members were jointly and severally liable in respect of the commitments made by the associations towards third parties. In those circumstances, the Commission was entitled to take the turnover of the members of the associations into account for the purposes of calculating the ceiling of 10% (judgments in CB and Europay v Commission, cited above, paragraph 138, and in Case T‑338/94 Finnboard v Commission, cited above, paragraphs 275 and 280, confirmed upon appeal by the judgment in Case C‑298/98 P Finnboard v Commission, cited above, paragraph 66).

53

In the judgment in SCK and FNK v Commission, cited above, the Court of First Instance stated that the association in question could, pursuant to its articles of association, adopt decisions binding its members and expel members that did not comply with those decisions. In its assessment, the Court of First Instance considered that the Commission was entitled to take account of the turnover of the members, pointing out that the association’s articles of association expressly permitted it to bind its members (judgment in SCK and FNK v Commission, cited above, paragraph 253).

54

It must also be stated that in the order in Nederlandse Federatieve Vereniging voor de Groothandel op Elektrotechnisch Gebied v Commission, cited above, the President of the Court of First Instance considered (at paragraph 56), when assessing the need for urgency, that the articles of association of the association in question contained provisions permitting it to bind its members. He found in this regard first that, under the terms of the articles of association, the members were bound to abide strictly by the provisions of the articles of association, the internal rules and the decisions of the board of directors and meetings, that a member could be expelled from the association if it ceased to satisfy the requirements laid down by the articles of association or the internal rules, and finally that a member could be liable to a reprimand, suspension or fine of up to NLG 10 000 if the board of directors considered that it had acted in disregard of the articles of association, internal rules or decisions validly adopted by the association.

55

In the present case, it is clear from Article 4 of the applicant’s articles of association that the applicant’s board of directors may adopt internal rules with which members must comply. In the light of the judgment in SCK and FNK v Commission, cited above, it cannot be excluded that this is sufficient to consider that the applicant may bind its members and that the taking into account of their turnover is justified.

56

However, in contrast to the case which gave rise to that judgment, Article 12 of the applicant’s articles of association lays down that ‘the members shall be held liable only if they have not opposed such liability in advance’. It may be deduced from this that the applicant’s articles of association do not allow it to bind its members against their will.

57

It must also be stated that the applicant’s articles of association provide that the board of directors may expel members only if they act in contravention of the articles of association or if their activities are ‘likely to harm the interests of the [FNCBV]’ (Article 5). In the case which gave rise to the judgment in SCK and FNK v Commission, cited above, the articles of association permitted the association to expel members that did not comply with the ‘decisions’ of the board of directors.

58

It is noted that in the present case the applicant and the Commission have produced no example or explanation that enable the judge hearing the application for interim measures to determine precisely the scope of the various provisions of the applicant’s articles of association. In these circumstances, and without undertaking investigations that go beyond the ambit of proceedings for interim measures, it is not possible to determine with certainty whether the applicant may bind its members within the meaning of the applicable case-law and, in particular, whether this was the case in connection with the conclusion of the disputed agreements.

59

On any view, it is clear from the foregoing that this plea is not without substance. Furthermore, the judge hearing the application for interim measures considers that the conditions for allowing the turnover of the members of an association to be taken into account when applying the 10% ceiling provided for in Article 15(2) of Regulation No 17 warrant detailed examination and assessment solely by the court adjudicating on the substance.

60

As to the second plea based on the failure to state reasons regarding the ceiling on fines, according to settled case-law the statement of reasons required by Article 253 EC must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent court to exercise its power of review (judgment in Case C‑367/95 P Commission v Sytraval and Brink’s France [1998] ECR I‑1719, paragraph 63). The extent of the obligation to state reasons imposed by Article 253 EC depends on the nature of the measure at issue and the context in which it was adopted (judgments in Cases C‑350/88 Delacre and Others v Commission [1990] ECR I‑395, paragraphs 15 and 16, and Commission v Sytraval and Brink’s France, cited above, paragraph 63).

61

As regards a decision imposing fines on several undertakings for an infringement of Community competition rules, as in the present case, the scope of the duty to state reasons must be determined inter alia in the light of the fact that the gravity of the infringement depends on numerous factors, such as the particular circumstances of the case, its context and the dissuasive effect of fines, although no binding or exhaustive list of the criteria to be applied has been drawn up (order of the Court of Justice in Case C‑137/95 P SPO and Others v Commission [1996] ECR I‑1611, paragraph 54).

62

Recitals 162 to 186 of the decision relate to the application of Article 15(2) of Regulation No 17.

63

In recital 170 of the decision, the Commission considers that the amount of the annual membership fees collected by each of the undertakings to which the decision is addressed may be an objective criterion reflecting the relative size of the different farmers’ federations and their degree of responsibility in the infringement. In view of this, the Commission set the basic amount of the fine on the FNSEA at EUR 20 million and that on the FNCBV at one tenth of that amount.

64

On the other hand, no recital in the decision deals with an examination of any exceeding of the 10% ceiling or, a fortiori, with an appraisal of the possibility of taking the turnover of the applicant’s members into account.

65

Prima facie, the decision therefore does not enable the persons concerned and the Community Court to ascertain the reasons why the Commission considered it appropriate to take account of that turnover.

66

As the extent of the obligation to state reasons depends on the nature of the measure in question and on the context in which it was adopted (see paragraph 60 above), the Commission must explain its reasoning when it adopts a decision which goes appreciably further than its previous decisions (see to that effect the judgments in Case 73/74 Fabricants de Papiers Peints and Others v Commission [1975] ECR 1491, paragraph 31, and in SCK and FNK v Commission, cited above, paragraph 226). It is all the more necessary when, as appears to be the case in the present proceedings (see paragraphs 55 to 57 above), it goes beyond the case-law.

67

In those circumstances, and contrary to the assertions of the Commission, it cannot be precluded, prima facie, that in the present case the Commission should have stated the factors that it took into account in determining the turnover to be taken into consideration for assessing whether the fine imposed exceeded the ceiling of 10%.

68

The foregoing considerations are sufficient to conclude that at least some of the pleas put forward by the applicant are not entirely without merit and warrant detailed examination by the court adjudicating on the substance. In these conditions, in the present proceedings it must be recognised that a prima facie case exists.

Urgency

69

It is settled case-law that an application for an exemption from the obligation to provide a bank guarantee as a condition for the fine not being recovered immediately will only be granted in exceptional circumstances (orders of the President of the Court of Justice of 6 May 1982 in Case 107/82 R AEG v Commission [1982] ECR 1549, paragraph 6, and in FEG v Commission, cited above, paragraph 44). The possibility of requiring the provision of a financial guarantee is expressly provided for with regard to applications for interim relief by the Rules of Procedure of the Court of Justice and of the Court of First Instance and is a general and reasonable way for the Commission to act (order of the President of the Court of First Instance in Case T‑79/03 R IRO v Commission [2003] ECR II‑3027, paragraph 25).

70

The existence of such exceptional circumstances may, in principle, be regarded as established where the party seeking exemption from providing the requisite bank guarantee adduces evidence that it is objectively impossible for it to provide such guarantee (order in IRO v Commission, cited above, paragraph 26).

71

With regard to the assets of the applicant, the latter states that, given its financial situation, the provision of the entire amount of the bank guarantee, together with the related expenses, would lead to its dissolution. In support of this assertion, it points to its statement of assets at 31 December 2002 (see paragraphs 26 and 27 above). In addition, it produces two letters from two French banks refusing to provide it with the requisite bank guarantee, particularly in view of its insufficient assets.

72

The Commission only stated that the accounting documents provided by the applicant did not have evidential value as they had not been duly signed and certified.

73

It must be observed first that, in the light of the written observations from the Commission, the Court of First Instance authorised the applicant to produce its general auditors’ report on the accounts for the 2002 financial year and its draft budget for 2003, signed by the applicant’s legal representative. These documents were lodged at the Registry of the Court of First Instance on 16 October 2003 and confirm the information set out in paragraphs 26 and 27 above.

74

At the hearing the applicant replied to a series of questions about its assets and explained various items in its balance sheet. Following the hearing, the applicant undertook to examine the possibility of an agreed staggering of the payment of the fine and to make a proposal to the Commission in this regard.

75

On 7 November 2003 the applicant and the Commission communicated the outcome of their discussions. The applicant offered to provide a bank guarantee for EUR 60 000 immediately and to pay EUR 140 000 on 31 December 2003. The Commission rejected this proposal.

76

In the light of the explanations provided by the applicant and the content of its offer, the President of the Court of First Instance considers that its assertion that its own resources are not sufficient to allow it to release funds over and above those proposed in the context of the present proceedings are substantiated.

77

However, it must be recalled that, according to settled case-law, the damage to an association of undertakings must be assessed having regard to the financial situation of its members, where the objective interests of the association are not independent of those of the member undertakings (orders in Cases C‑268/98 P(R) SCK and FNK v Commission, cited above, paragraphs 35 to 38, and C‑335/99 P(R) HFB and Others v Commission [1999] ECR I‑8705, paragraph 63).

78

It is therefore necessary to examine whether, in the present case, the financial situation of the applicant must be assessed by taking account of that of its members.

79

At the hearing the applicant observed that since under its articles of association it cannot hold its members liable it cannot be considered that its interests merge with those of its members.

80

Although it is true that in the present case there is doubt as to whether the applicant can hold its members liable within the meaning of the applicable case-law (see paragraphs 55 to 58 above), this circumstance does not automatically lead to the conclusion that the applicant’s actions during the beef crisis in 2001 did not serve the objective interests of its members. Indeed, it is clear from the case-law cited above (see in particular the order in Case C‑268/98 P(R) SCK and FNK v Commission, cited above, paragraph 37) that in order to determine the extent to which the objective interests of an association are independent of those of its members, the existence of internal rules enabling the association to hold its members liable may be taken into account. However, the objective interests of the association may merge with those of its members as a result of other circumstances, regardless of the existence or absence of such rules.

81

In its application for interim measures, the applicant put forward no argument to show that its actions did not serve the objective interests of its members and, in particular, those of the members involved in cattle production.

82

In reply to a question put by the President of the Court of First Instance on this subject at the hearing, the applicant stated that the bodies operating in the slaughtering sector, which represent only 30 of its approximately 330 members, had no interest in the conclusion of the disputed agreements.

83

This argument is not, however, supported by any explanation that allows the President of the Court of First Instance to assess its relevance and, moreover, appears prima facie to be unfounded. The President of the Court of First Instance finds, in this regard, that the applicant does not dispute having concluded the agreement of 24 October 2001 as the representative of its members operating in the slaughtering sector. Nor does the applicant dispute that it had the necessary support of its members to conclude that agreement. Moreover, it would seem inconceivable that a national federation whose object under the terms of its articles of association is to provide intellectual and professional support to its members (see paragraph 47 above) claims to have acted against their interests.

84

These circumstances are sufficient to conclude that the objective interests of the applicant cannot be considered to be independent from those of its members. It follows that, in accordance with the case-law cited in paragraph 77 above, the risk of serious and irreparable harm that would result from the provision of the bank guarantee has to be assessed having regard to the size and economic power of the undertakings belonging to the applicant federation.

85

It is necessary to note in this regard that the applicant neither alleged nor, a fortiori, demonstrated that its members together did not have the financial capacity to provide the necessary financial support to pay the fine or provide the bank guarantee, taking account of the proposals made in the context of these proceedings.

86

In reply to a question from the President of the Court of First Instance, the applicant acknowledged that it would be possible, under its articles of association, to increase its members’ subscriptions as an exceptional measure in order to pay the fine or provide the bank guarantee. However, in order to do so, under Article 6 of its articles of association, a meeting of the board of directors first had to be called to vote such an increase, which would take some time. Furthermore, it contended that it was rather unlikely that its members would be prepared to pay amounts in excess of their usual annual subscriptions.

87

As to the risk of a refusal by the members to provide the financial assistance necessary to the applicant’s survival, it must be observed that the unilateral intentions of the members of an association have no impact on the assessment of their financial situation and that consequently the possibility of a unilateral refusal on their part cannot affect such an assessment (see to that effect the order in FEG v Commission, cited above, paragraph 46). Moreover, nothing in the file gives grounds for thinking that it would be inconceivable for the board of directors to vote for a partial change in the subscriptions of the members most affected by the disputed agreements, that is to say the undertakings operating in the cattle sector.

88

With regard to the means of increasing members’ subscriptions, the applicant provided no explanation of the time needed for the board of directors to meet, vote the increase in members’ subscriptions and implement the increase.

89

However, it appears from Article 6 of the applicant’s articles of association that ‘the amount and methods of paying subscriptions are set each year by the board of directors’. Under Article 11, ‘the federal board of directors shall meet at least three times a year at the instance of its Chairman or, in his absence, at that of a Deputy Chairman’ and ‘it shall also meet at the written request of one-third of the directors’. The articles of association do not therefore appear to impose deadlines for calling meetings of the board of directors.

90

In view of these provisions and in the absence of precise explanations from the parties in this regard, the President of the Court of First Instance considers that a period of two months should be sufficient to permit the applicant’s board of directors to meet, vote the increase in members’ subscriptions and implement the increase.

91

It follows from the foregoing that the applicant has proved satisfactorily that exceptional circumstances exist in that it is at risk of serious and irreparable harm if the obligation to provide the requisite bank guarantee is not suspended for a period of two months from the date of notification of this order.

The balance of interests

92

It is necessary to weigh the applicant’s interest in avoiding – in the event that it is unable to arrange a bank guarantee – immediate payment of the fine against the Community’s financial interest in being able to recover that sum and, more generally, against the public interest in preserving the effectiveness of Community competition rules and the deterrent effect of fines imposed by the Commission (see to that effect the order of the President of the Court of Justice in Case 56/89 R Publishers Association v Commission [1989] ECR 1693, paragraph 35, and the orders of the President of the Court of First Instance in Joined Cases T‑24/92 R and T‑28/92 R Lagnese-Iglo and Schöller Lebensmittel v Commission [1992] ECR II‑1839, paragraph 28, in Case T‑88/94 R Société Commerciale des Potasses et de l’Azote and Entreprise Minière et Chimique v Commission [1994] ECR II‑401, paragraph 32, and of 28 June 2000 in Cho Yang Shipping v Commission, cited above, paragraph 53).

93

As regards the financial interests of the Community, it must be observed first that, as has been noted above, the applicant’s assets are not sufficient for it to pay the entire amount of the fine or to provide the full bank guarantee required. Moreover, in view of the applicant’s explanations regarding Article 16 of its articles of association (see paragraph 46 above), there is a doubt as to the Commission’s ability to recover the amount from the applicant’s members if the applicant is liquidated. In any event, as the Commission itself acknowledged in its written observations, such a recovery procedure would entail costs, delays and increased risks. In these circumstances, it appears that the financial interests of the Commission are best served by granting the applicant the time it needs to seek voluntary financial assistance from its members.

94

Furthermore, the financial interests of the Commission are also protected by the applicant’s commitment to provide a bank guarantee and to pay an amount covering a not inconsiderable part of the fine.

95

As regards the public interest in preserving the effectiveness of Community competition rules and the deterrent effect of fines imposed by the Commission, the Commission has not demonstrated how the granting of a partial suspension for a limited period would jeopardise that interest in the present case.

96

In the light of these considerations, it seems appropriate to grant the applicant a stay of two months from the date of notification of this order to provide the requisite bank guarantee provided that, within a period of four weeks from the same date, it pays EUR 140 000 to the Commission and provides a bank guarantee of EUR 60 000 in favour of the latter or, alternatively, provides a bank guarantee of EUR 200 000 in favour of the Commission. At the end of the period of suspension the applicant must therefore either pay the balance of the fine, plus interest, or provide a bank guarantee covering that amount.

97

It should be pointed out, furthermore, that, under Article 108 of the Rules of Procedure, the judge hearing an application for interim measures may at any time vary or cancel an interim order on account of a change in circumstances (order of the President of the Court of First Instance in Case T‑198/01 R Technische Glaswerke Ilmenau v Commission [2002] ECR II‑2153, paragraph 123, confirmed upon appeal by order of the President of the Court of Justice in Case C‑232/02 P(R) Commission v Technische Glaswerke Ilmenau [2002] ECR I‑8977). It follows from that case-law that, by a change in circumstances, what are especially envisaged are factual circumstances capable of altering the assessment made in each particular case of the criterion of urgency. Furthermore, according to the Court of Justice, that possibility reflects the fundamentally precarious nature in Community law of measures granted in interim relief proceedings (order of the Court of Justice in Case C‑440/01 P(R) Commission v Artegodan [2002] ECR I‑1489).

98

If appropriate, it will therefore be for the Commission to petition the Court of First Instance if it considers that a change in circumstances likely to alter the present decision has occurred.

On those grounds,

THE PRESIDENT OF THE COURT OF FIRST INSTANCE

hereby orders:

1. For a period of two months from the date of notification of this order, the obligation on the applicant to provide a bank guarantee for the Commission in order to avoid immediate recovery of the fine imposed on it by Article 3 of Commission Decision 2003/600/EC of 2 April 2003 relating to a proceeding pursuant to Article 81 of the EC Treaty (Case COMP/C.38.279/F3 – French beef) is suspended, provided that, within a period of four weeks from the same date, the applicant pays to the Commission the sum of EUR 140 000 and provides a bank guarantee of EUR 60 000 or, alternatively, provides a bank guarantee of EUR 200 000.

2. The costs are reserved.

Luxembourg, 21 January 2004.

H. Jung B. Vesterdorf

Registrar President

1 –

Language of the case: French.