ORDER OF THE COURT (Eighth Chamber)
4 February 2021 (*)
(Appeal – Article 181 of the Rules of Procedure of the Court of Justice – Appeal manifestly unfounded – Economic and monetary policy – Prudential supervision of credit institutions – Suspension measures taken by the national supervisory authority – Appointment of a contact person – Conditional communication with the European Central Bank (ECB) – Withdrawal of licence prior to the commencement of proceedings – Action for annulment – Inadmissibility – Absence of a sufficiently clear and precise summary of the pleas in law relied on before the General Court – Failure to demonstrate a legal interest in bringing proceedings – Incorrect classification as a preparatory act – Substitution of grounds)
In Case C‑701/19 P,
APPEAL under Article 56 of the Statute of the Court of Justice of the European Union, brought on 20 September 2019,
Pilatus Bank plc, established in Ta’Xbiex (Malta), represented initially by O.H. Behrends and M. Kirchner, Rechtsanwälte, and subsequently by O.H. Behrends,
appellant,
the other party to the proceedings being:
European Central Bank (ECB), represented by E. Yoo, M. Anastasiou and A. Karpf, acting as Agents,
defendant at first instance,
THE COURT (Eighth Chamber),
composed of N. Wahl (Rapporteur), President of the Chamber, F. Biltgen and J. Passer, Judges,
Advocate General: J. Kokott,
Registrar: A. Calot Escobar,
having regard to the decision taken, after hearing the Advocate General, to give a decision by reasoned order, in accordance with Article 181 of the Rules of Procedure of the Court of Justice,
makes the following
Order
1 By its appeal, Pilatus Bank plc asks the Court of Justice to set aside the order of the General Court of the European Union of 10 July 2019, Pilatus Bank v ECB (T‑687/18, not published, ‘the order under appeal’, EU:T:2019:542), by which the General Court dismissed its action for annulment of the email of the European Central Bank (ECB) of 10 September 2018 in so far as, by that email, the ECB had asked Pilatus Bank plc to ‘direct its comments and future communications with the ECB’ via the competent person appointed under Maltese law or with the competent person’s approval (‘the email at issue’).
Background to the dispute
2 The background to the dispute, as set out in paragraphs 1 to 5 of the order under appeal, may, for the purposes of the present proceedings, be summarised as follows.
3 Pilatus Bank, a credit institution established under Maltese law, was the subject of administrative proceedings concerning the withdrawal of its licence as a credit institution, initiated by the Malta Financial Services Authority (‘MFSA’).
4 On 22 March 2018, the MFSA appointed a ‘competent person’, within the meaning of Maltese law, with authority, under the terms of that appointment, to ‘assume all the powers, functions and duties of the Bank in respect of all assets, whether exercisable by the Bank in general meeting or by the Board of Directors or by any other person, including the legal and judicial representation of the Bank to the exclusion of the Bank and any other person’.
5 After MFSA submitted a proposal to withdraw the appellant’s licence and then a revised proposal to withdraw that licence, the ECB sent the email at issue to the appellant.
6 By decision of 2 November 2018, the ECB withdrew the appellant’s licence. That decision was the subject of an action for annulment before the General Court, registered as Case T‑27/19 and still pending.
The action before the General Court and the order under appeal
7 By application lodged at the Registry of the General Court on 20 November 2018, the appellant brought an action for annulment of the email at issue.
8 By a separate document lodged at the Registry of the General Court on 7 December 2018, the appellant made an application for interim measures. By order of 21 January 2019, Pilatus Bank v ECB (T‑687/18 R, not published, EU:T:2019:28), that application was dismissed and the costs were reserved.
9 By a separate document lodged at the Registry of the General Court on 5 February 2019, the ECB made an application for a declaration that there was no need to adjudicate, pursuant to Article 130(2) of the Rules of Procedure of the General Court, and a plea of inadmissibility pursuant to Article 130(1) of the Rules of Procedure, in which it claimed that the email at issue was not a challengeable act for the purposes of Article 263 TFEU.
10 After receiving the appellant’s observations on the application for a declaration that there was no need to adjudicate and the plea of inadmissibility, the General Court, taking the view that it had sufficient information from the documents in the file, decided, on the basis of Article 130(1) and (7) of its Rules of Procedure, to adjudicate on that plea without taking further steps in the proceedings. By the order under appeal, it dismissed the action as inadmissible and ordered the appellant to pay the costs, including those relating to the proceedings for interim measures.
11 In reaching that dismissal, the General Court first of all pointed out that only measures the legal effects of which are binding on, and capable of affecting the interests of, an applicant by bringing about a distinct change in its legal position may be the subject of an action for annulment on the basis of Article 263 TFEU, and recalled the criteria for determining whether an act produces such legal effects or whether it constitutes an intermediate or preparatory act which cannot be open to challenge by an action for annulment.
12 Next, the General Court sought, in the light of the subject matter, content, substance, and factual and legal context in which the email at issue formed part, to determine whether that email produced binding legal effects capable of affecting the appellant’s interests by bringing about a distinct change in its legal position.
13 In that regard, the General Court held that the email at issue, by specifying the forms which communications addressed to the ECB should take, had solely the purpose and effect of expressing the ECB’s view on a particular aspect of the course of the preparatory proceedings concerning the adoption of a potential licence withdrawal decision, with the result that the email at issue did not produce legal effects that were distinct from those of that decision, but produced only limited effects characteristic of an intermediate measure forming part of a preliminary administrative procedure.
14 The Court also added that the email at issue governed solely certain aspects of the licence withdrawal proceedings but did not include any decision on the substance and, therefore, did not constitute the culmination of a separate special procedure.
15 Thus, the Court concluded that the email at issue did not produce binding legal effects capable of affecting the appellant’s interests by bringing about a distinct change in its legal position and, therefore, that the email at issue was not open to challenge by an action for annulment.
16 Finally, the Court held that that conclusion could not be called into question by the perception, claimed by the appellant, that the email at issue produced binding legal effects, or by how the intention of the ECB’s officials was perceived, or by the seriousness of an alleged infringement by the institution concerned or by the extent of its adverse effect on the observance of fundamental rights, since whether an act is open to challenge cannot be deduced from its possible unlawfulness.
Forms of order sought by the parties
17 By its appeal, the appellant claims that the Court of Justice should:
– set aside the order under appeal;
– declare that the action for annulment is admissible;
– refer the case back to the General Court for it to rule on the action for annulment, and
– order the ECB to pay the costs, including those relating to the present appeal.
18 The ECB contends that the Court should:
– dismiss the appeal, and
– order the appellant to pay the costs.
The appeal
19 Under Article 181 of the Rules of Procedure of the Court of Justice, where the appeal is, in whole or in part, manifestly inadmissible or manifestly unfounded, the Court may at any time, acting on a proposal from the Judge-Rapporteur and after hearing the Advocate General, decide by reasoned order to dismiss that appeal in whole or in part.
20 It is appropriate to apply that provision in the context of the present appeal.
21 In support of the appeal, the appellant relies on eight grounds of appeal, alleging, first, that the General Court distorted Maltese law, second, that the General Court infringed the appellant’s right to an effective remedy, third, that the email at issue was wrongly classified as a preparatory act, fourth, distortion of the content of that email and of the facts of the case, fifth, that it is impossible to uphold the order under appeal on the basis of the possibility, relied on in the alternative by the ECB, of a consultation between the ‘competent person’ and the members of the appellant’s governing board, sixth, that it is impossible to uphold that order by finding, as also relied on in the alternative by the ECB, that a lawyer was involved alongside the ‘competent person’, seventh, that it is impossible to uphold that order by adopting the argument, which is still relied on in the alternative by the ECB, that the request to direct communications to the ECB via or with the approval of the ‘competent person’ is contained only in a simple email and, eighth, that the action has not become devoid of purpose.
22 The ECB contends that the grounds of appeal should be rejected. It submits that the second ground is unfounded and that the other grounds are inadmissible, either because they are not confined to questions of law (first and fourth grounds of appeal), or because they lack legal arguments in support of them (third ground of appeal), or because they are insufficiently precise as regards the elements of the order under appeal which are contested and merely repeat the arguments put forward before the General Court (fifth to eighth grounds of appeal). The ECB also submits, in the alternative, that the first, third and fourth grounds of appeal are unfounded.
23 It should be noted at the outset that, according to settled case-law, any fact which relates to the admissibility of the action for annulment brought before the General Court is likely to constitute a question of public policy which the Court of Justice, hearing an appeal, is required to raise of its own motion (order of 5 September 2013, ClientEarth v Council, C‑573/11 P, not published, EU:C:2013:564, paragraph 20 and the case-law cited).
24 Thus, first, in order to satisfy the requirements of Article 76(d) of the Rules of Procedure of the General Court, the summary of the pleas in law which must appear in the application must be sufficiently clear and precise to enable the defendant to prepare its defence and the Court to rule on the action, if necessary without having to seek further information.
25 Second, any applicant must have a vested and present interest in bringing proceedings (see, to that effect, judgments of 17 September 2009, Commission v Koninklijke FrieslandCampina, C‑519/07 P, EU:C:2009:556, paragraph 65, and of 26 February 2015, Planet v Commission, C‑564/13 P, EU:C:2015:124, paragraph 34), which means that the EU judicature ascertains whether the applicant will benefit from any annulment of the contested decision. Furthermore, it is for that party to establish how the annulment which it seeks is capable of procuring such an advantage (see, to that effect, judgment of 4 June 2015, Andechser Molkerei Scheitz v Commission, C‑682/13 P, not published, EU:C:2015:356, paragraph 27 and the case-law cited). In particular, in order for an action seeking annulment of an act, submitted by a natural or legal person, to be admissible, it must justify in a relevant manner its interest in the annulment of that act (judgment of 7 November 2018, BPC Lux 2 and Others v Commission, C‑544/17 P, EU:C:2018:880, paragraph 34 and the case-law cited).
26 It must be noted that, in the present case, the application before the General Court did not satisfy any of those conditions.
27 First, although, from a formal point of view, that application contained a statement of nine pleas in law, the information which was supposed to support them was too brief to enable the General Court to assess whether the pleas in law were well founded, since their headings and their content contained general considerations which did not enable the pleas in law to be examined in detail.
28 Thus, the first and second pleas in law, entitled ‘Lack of any legal basis in Maltese or European law’ and ‘Violation of all substantive and procedural rights of the Applicant vis-à-vis the ECB (including those pursuant to [Regulation (EU) No 468/2014 of the European Central Bank of 16 April 2014 establishing the framework for cooperation within the Single Supervisory Mechanism between the European Central Bank and national competent authorities and with national designated authorities (OJ 2014 L 141, p. 1)] and the [Charter of Fundamental Rights of the European Union])’, did not contain any precise and structured arguments. As regards, in particular, the second plea in law, the appellant merely asserted in that plea that the rights alleged to have been infringed ‘[were] necessarily all-encompassing because any right vis-a-vis the ECB involves the need to communicate with the ECB’ and that they ‘affect[ed] a large number of fundamental aspects of the rule of law (such as the right to be heard, the right to access the file, the right to make use of remedies such as the request for a review by the Administrative Board of Review of the ECB, the right to be represented by external legal counsel, the right to the confidentiality of communications with the counsel)’.
29 As regards the seven other pleas in law, although their headings were more specific, they were not supported by precise and structured arguments either. Thus, in the context of the ninth plea, entitled ‘Violation of the nemo auditur principle’, the appellant complained that the ECB did not create appropriate rules or provide appropriate guidelines, which seems difficult to connect to that principle since the ECB had not relied on that situation. Similarly, the appellant went so far as to refer, in regrettable terms, to ‘the ECB[’s] reckless disregard for the rule of law’, for which it provides no arguments whatsoever.
30 That application therefore manifestly disregarded Article 76(d) of the Rules of Procedure of the General Court, which constituted a ground of inadmissibility of the application.
31 Second, the incomplete nature of the application before the General Court was also characterised by the part of the application entitled ‘Admissibility’. By merely stating in that part that its subsequent communications would have to comply with the requirements of the email at issue, failing which they would be rejected, the appellant has not established its interest in bringing proceedings. It should be noted that, in that email, the ECB informed the appellant of the following:
‘Finally, taking into consideration that, as you are aware, the [MFSA] has appointed a [“]Competent Person[”] to represent [Pilatus Bank] we would like to ask you to direct your comments/future communications with the ECB in respect of [Pilatus Bank] via this Person or to attach to any future submission the Competent Person’s approval.’
32 Although, in the light of the case-law referred to in paragraph 25 of the present order, it was for the appellant to demonstrate that the annulment of the email at issue, even if it were a decision in nature, would be capable of procuring an advantage for the appellant, notwithstanding the withdrawal of its licence prior to bringing the action, the appellant has not established or even claimed that it had a vested and present interest in that annulment, a fact which was also such as to render the action at first instance inadmissible.
33 It is true that, in order to dismiss that action as inadmissible, the General Court relied, as stated in paragraphs 13 and 14 of the present order, on its finding that the email at issue was a preparatory act. In so doing, as the appellant submits in the third ground of appeal, the General Court erred in law. It is apparent from the order under appeal that, according to the General Court, the email at issue set out the ECB’s position on the representation of the appellant in the context of a supervisory procedure and that email had actual, although limited, legal effects. As the appellant rightly submits, to accept that the email at issue produced legal effects as regards the representation of the appellant necessarily gave grounds for believing that such a position of the ECB was definitive and final as regards that issue.
34 Although it is true that the question of the representation of a party may arise in a supervisory procedure such as licence withdrawal proceedings, a decision concerning the representation of a party is, nevertheless, legally independent of the decision to withdraw a banking institution’s licence.
35 In particular, the question of the representation of a party during licence withdrawal proceedings does not, in principle, have any effect on the decision whether or not to withdraw the licence, adopted at the end of such proceedings. Thus, the ECB’s position regarding the representation of a party is in no way intended to pave the way for the final decision relating to, for example, withdrawal of a licence and does not constitute that institution’s provisional opinion the purpose of which is to prepare for such a decision.
36 Consequently, the question of the representation of a party during licence withdrawal proceedings does not constitute a stage in those proceedings. Therefore, if an action were brought before the General Court against the ECB’s position on the representation of a party during a supervisory procedure such as a licence withdrawal proceedings, the Court would not arrive at a decision on questions on which the ECB had not yet had an opportunity to state its position (see, to that effect, judgment of 11 November 1981, IBM v Commission, 60/81, EU:C:1981:264, paragraphs 11 and 20).
37 Therefore, on the premiss that the email at issue produced legal effects, but by taking the view that those effects were limited to certain aspects of the licence withdrawal proceedings, the General Court drew an incorrect conclusion from its own premiss.
38 The General Court’s error in law regarding the preparatory nature of the email at issue cannot, however, lead to the setting aside of the order under appeal, since the operative part of that order remains well founded on the legal grounds relating to infringement of Article 76(d) of the Rules of Procedure of the General Court and on the absence of an interest in bringing proceedings, which it is appropriate to substitute for the incorrect legal ground relied on by the General Court (orders of 15 February 2012, Internationaler Hilfsfonds v Commission, C‑208/11 P, not published, EU:C:2012:76, paragraph 35 and the case-law cited, and of 5 September 2013, ClientEarth v Council, C‑573/11 P, EU:C:2013:564, paragraphs 23 and 24).
39 Since none of the seven other grounds of appeal, even if they were admissible, is capable of calling into question those considerations relating to the action before the General Court, the appeal must be dismissed in its entirety as being manifestly unfounded.
Costs
40 Under Article 138(1) of those Rules of Procedure of the Court of Justice, which applies to appeal proceedings by virtue of Article 184(1) thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the ECB has applied for costs and the appellant has been unsuccessful in all of its grounds of appeal, the appellant must be ordered to pay the costs.
On those grounds, the Court (Eighth Chamber) hereby orders:
1. The appeal is dismissed.
2. Pilatus Bank plc is ordered to pay the costs.
Luxembourg, 4 February 2021.
Registrar | | President of the Eighth Chamber |