ORDER OF THE GENERAL COURT (First Chamber)
12 March 2012 (*)
(Competition – Agreements, decisions and concerted practices – Italian market for the purchase and first processing of raw tobacco – Request that the parent company pay the fine – Bank guarantee lodged in the name of the subsidiary – Date on which the fine becomes due for payment – Action for annulment – Measure not open to challenge – Inadmissibility)
In Case T‑42/11,
Universal Corp., established in Richmond, Virginia (United States), represented by C. Swaak, lawyer,
applicant,
v
European Commission, represented by É. Gippini Fournier and L. Malferrari, acting as Agents,
defendant,
APPLICATION for annulment of the decision allegedly contained in the Commission’s letters of 12 and 30 November 2010 in which the Commission requested the applicant to pay the amount of the fine that had been imposed on it, jointly and severally with its subsidiary Deltafina SpA, by Commission Decision C(2005) 4012 final of 20 October 2005 relating to a proceeding under Article 81 [EC] (Case COMP/C.38.281/B2 – Raw Tobacco – Italy),
THE GENERAL COURT (First Chamber),
composed of J. Azizi, President, E. Cremona (Rapporteur) and S. Frimodt Nielsen, Judges,
Registrar: E. Coulon,
makes the following
Order
Background to the dispute
1 By Decision C(2005) 4012 final of 20 October 2005 relating to a proceeding under Article 81 EC (Case COMP/C.38.281/B.2 – Raw tobacco – Italy) (‘the Raw Tobacco Italy decision’), the Commission of the European Communities found inter alia that Deltafina SpA, a wholly-owned subsidiary of the applicant, Universal Corp., had infringed Article 81 EC, by participating in a cartel on the Italian raw tobacco market. The applicant was therefore declared liable in respect of the alleged infringement, in respect of its subsidiary, throughout the whole period of that infringement.
2 More specifically, Article 2(a) of the operative part of the Raw Tobacco Italy decision imposed on the applicant, jointly and severally with Deltafina, a fine of EUR 30 million. That article provided that the fine thus imposed was payable within three months of the date of notification of that decision. It also provided that after that period had expired interest would be payable on the amount of the fine at the rate applied by the European Central Bank to its main refinancing operations on the first day of the month in which the decision at issue was adopted, plus 3.5 percentage points, namely 5.56%.
3 The Commission notified the applicant of the Raw Tobacco Italy decision by letter of 9 November 2005, which meant that the applicant was required to pay the fine by 9 February 2006, the date from which the Commission was entitled to pursue recovery of the fine. That letter stated, however, that if the applicant decided to institute proceedings against that decision before the Courts of the European Union no enforcement measure would be taken as long as the case was pending before those courts, provided that interest was paid on the sum due from the date on which the time-limit for payment expired, which in the present case was 9 February 2006, calculated on the basis of the interest rates applied by the European Central Bank, plus 1.5 percentage points, namely 3.56%, and that a bank guarantee acceptable to the Commission and covering both the principal and the interest or increased amount of the debt was provided by that date.
4 The applicant and Deltafina brought actions on 24 and 19 January 2006, respectively, for annulment of the Raw Tobacco Italy decision and, in the alternative in so far as Deltafina was concerned, for reduction of the amount of the fine imposed. Those actions were registered as Case T‑34/06, as regards the applicant’s action, and Case T‑12/06, as regards Deltafina’s action.
5 Under the option offered by the Commission, Deltafina decided to lodge a bank guarantee to cover the total amount of the fine and interest, thus avoiding the need to pay those sums immediately. Thus, on 9 February 2006, the branch of the Banca Nazionale del Lavoro in Perugia (Italy), issued a bank guarantee, to the order and for the account of Deltafina, based on the standard guarantee annexed to the Commission’s letter of 9 November 2005, both for the fine of EUR 30 million, imposed jointly and severally on Deltafina and the applicant by the Raw Tobacco Italy decision, and for the interest on the principal, calculated on the basis of the rate applied by the European Central Bank, plus 1.5 points, from 15 February 2006 until actual payment of the fine. On 31 January 2008, that guarantee was replaced by an identical guarantee provided by ING Bank NV, London Branch (United Kingdom), and subsequently, on 25 February 2009, the bank guarantee was transferred to ING’s headquarters – ING Bank NV, Amsterdam (Netherlands). As set out in the Commission’s standard guarantee, the guarantee states that it is to be executed on first demand on the basis of a certified copy of the definitive judgment of the General Court in Case T‑12/06 or, in the event of an appeal, of the judgment of the Court of Justice, notified by registered letter.
6 Following questions in writing put by the General Court on 24 November 2009 and 6 July 2010, by way of measures of organisation of procedure provided for in Article 64 of the Rules of Procedure of the General Court, in the context of Case T‑34/06 and in the light of the implications of the judgment of the Court of Justice of 10 September 2009 in Case C‑97/08 P Akzo Nobel and Others v Commission [2009] ECR I‑8237 for the action brought against the Raw Tobacco Italy decision, the applicant, by letter of 26 July 2010, requested the Registry of the General Court to accept its withdrawal from the proceedings. The case was removed from the register by Order of the President of the Third Chamber of the General Court of 1 September 2010 in Case T‑34/06 Universal v Commission, not published in the ECR.
7 By letter of 12 November 2010 addressed to the applicant, the Commission stated that as a consequence of the withdrawal, the Raw Tobacco Italy decision had become legally binding with regard to the applicant and that the latter must pay the fine. In that regard, the letter stated the amount to be paid, namely EUR 35 138 104.11, in principal and interest, the value date being 6 December 2010.
8 By letter of 17 November 2010, the applicant replied that it was under no obligation to pay the fine or any part of it until the judicial proceedings were completed in Case T‑12/06 Deltafina v Commission. The applicant asked the Commission to adopt a formal decision if it wished to persist in its demand for immediate payment, in order for the applicant to be able to seek annulment of that decision.
9 By letter of 30 November 2010, the Commission repeated its demand for payment and stated that once the payment had been made the bank guarantee provided by Deltafina would be released. The letter also stated that, if payment had not been received by 13 December 2010, the fine would be recovered under Article 299 TFEU.
10 By letter of 13 December 2010, the applicant further explained its reasons for contesting the Commission’s demand for payment of the fine and again requested the Commission to adopt a formal decision.
Procedure and forms of order sought
11 By application lodged at the Court Registry on 19 January 2011, the applicant brought the present action.
12 By separate document, lodged at the Court Registry on 22 March 2011, the Commission raised a plea of inadmissibility under Article 114(1) of the Rules of Procedure. The applicant lodged its observations regarding that plea on 24 May 2011.
13 In its application, the applicant claims that the Court should:
– annul the Commission decision set out in its letters of 12 and 30 November 2010 (‘the contested letters’);
– declare that the applicant cannot be held liable to pay for any part or all of the fine imposed in the present case until a definitive judgment is given in Case T-12/06 Deltafina v Commission or any subsequent proceedings;
– order the Commission to pay the costs.
14 In its plea of inadmissibility, the Commission claims that the Court should:
– dismiss the action as inadmissible;
– order the applicant to pay the costs.
15 In its observations on the plea of inadmissibility, the applicant claims that the Court should reject that plea.
Law
16 Under Article 114 of the Rules of Procedure, where a party makes application for a decision on the admissibility of an action the Court may determine that application without proceeding to consider the substance of the case. Pursuant to Article 114(3) of the Rules of Procedure, unless the Court otherwise decides, the remainder of the proceedings are to be oral.
17 The Court considers that in the present case it is adequately informed by the contents of the file and that there is no need to open the oral procedure.
18 The Commission, on the basis of well-established case-law contends that the action for annulment brought against the letters of 12 and 30 November 2010 is inadmissible on the ground that, since they are not decisions, those letters are not acts which may be the subject of an action for annulment under Article 263 TFEU. They are merely requests for payment of a sum due resulting from the Raw Tobacco Italy decision and do not, as such, have legal effects capable of affecting the interests of the applicant by bringing about a distinct change in its legal position. The Commission also contends that the applicant has no legal interest in the letters at issue being annulled, since such annulment would be devoid of any legal effects.
19 The applicant challenges the Commission’s inconsistent application, in the present case, of the single undertaking doctrine under competition law and contends that the contested letters affect the applicant’s interests by bringing about a distinct change in its legal position, in that they set a new date on which the fine became due for payment which was not a result of the Raw Tobacco Italy decision. More specifically, by those letters, the Commission sent the applicant a demand for payment of the fine despite the fact that a single bank guarantee, covering the whole fine and the interest, was provided by Deltafina and was accepted by the Commission, and the fact that judicial proceedings brought by Deltafina were still pending. Moreover, in the applicant’s submission, the legal effects of those letters are indisputable in so far as the Commission stated in them that it would enforce recovery of the amount of the fine in principal and interest.
20 In order to give a ruling on the merits of the Commission’s plea of inadmissibility, it should be recalled that it is consistent case-law that only measures the legal effects of which are binding on, and capable of affecting the interests of, the applicant by bringing about a distinct change in his legal position are acts or decisions which may be the subject of an action for annulment under Article 263 TFEU (Case 60/81 IBM v Commission [1981] ECR 2639, paragraph 9; Case C‑516/06 P, Commission v Ferriere Nord [2007] ECR I‑10685, paragraph 27; see, to that effect, order of 29 April 2004 in Case T‑308/02 SGL Carbon v Commission [2004] ECR II‑1363, paragraph 39).
21 It is also settled case-law that, in order to ascertain whether a measure the annulment of which is sought is open to challenge, it is necessary to look to its substance, as the form in which it is cast is, in principle, immaterial (IBM v Commission, paragraph 20 above, paragraph 9; Case T-3/93 Air France v Commission [2008] ECR II-121, paragraph 57; and Case T‑260/04 Cestas v Commission [2008] ECR II‑701, paragraph 68).
22 It is therefore necessary to determine whether, in the present case, by the contested letters the Commission adopted measures having binding legal effects capable of affecting the applicant’s interests by bringing about a distinct change in its legal position for the purposes of Article 263 TFEU. The applicant argues, in essence, that that is the case since those letters reveal a new element which does not stem from the original Raw Tobacco Italy decision, namely that Universal is liable to pay the fine imposed on it jointly and severally with Deltafina notwithstanding the existence of a bank guarantee lodged by the latter and irrespective of the fact that the judicial proceedings brought by Deltafina against that decision are still pending.
23 In that regard, it should be noted that, in the letter of 12 November 2010, the Commission, first of all, informed the applicant that, following the withdrawal of its action in Case T‑34/06, the Raw Tobacco Italy decision had become legally binding with regard the applicant and that, therefore, the applicant had to pay the fine.
24 The Commission then called upon the applicant to pay the sum of EUR 35 138 104.11, adding that, in accordance with the table annexed to the letter at issue, that sum included the interest due from the day following the final date for payment of the amount claimed in the Raw Tobacco Italy decision until 6 December 2010. The Commission also stated that, should the applicant wish to pay the fine at an earlier date, it was amenable to providing it with an alternative interest calculation.
25 Lastly, the Commission gave the applicant the details of the bank account into which the payment should be made.
26 In the letter of 30 November 2010, sent in response to the applicant’s letter of 17 November 2010, the Commission, moreover, stated that the bank guarantee provided by Deltafina would be released in the event of payment of the fine by the applicant and that if that payment was not received by 13 December 2010 the fine would be recovered under Article 299 TFEU.
27 The conclusion must be drawn that the contested letters therefore have no autonomous legal effects capable of bringing about a distinct change in the applicant’s legal position.
28 It is clear from the content of the contested letters that they are merely a request made to the applicant for payment of the fine, together with default interest, which was imposed on it by the Raw Tobacco Italy decision. Thus, in so far as those letters merely require such payment, following the applicant’s withdrawal of the action for annulment of that decision, which had rendered definitive its obligation to pay the sum ordered in that decision, the contested letters cannot be regarded as having produced legal effects binding on, and capable of affecting the interests of, the applicant, since in reality they merely constitute acts preparatory to pure enforcement. Neither the former nor the latter acts constitute acts open to challenge (see, to that effect, Commission v Ferriere Nord, paragraph 20 above, paragraph 29 and the case-law cited).
29 Contrary to what the applicant contends, there is nothing in the contested letters that is not to be found in the Raw Tobacco Italy decision, which, as is stated in the second paragraph of Article 4 of that decision, is enforceable under Article 299 TFEU. In that decision, the Commission, in accordance with the power to impose fines conferred on it by Article 23(2) of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 [EC] and 82 [EC] (OJ 2003 L 1, p. 1), set the amount of the fine imposed, determined the date on which it was payable and set the rate of default interest (see, to that effect, Case T‑275/94 CB v Commission [1995] ECR II‑2169, paragraphs 46 and 47).
30 As regards the last point, it should be noted, moreover, that the rate of interest stated by the Commission, both in the letter of 12 November 2010 and in the letter of 30 November 2010, is lower than the rate set in the decision in the event of non-payment of the fine by the due date, namely 5.56%, and corresponds to the rate stated in the letter notifying the decision in the event that a bank guarantee was provided, namely 3.56%. That fact per se cannot be deemed capable of transforming into an act open to challenge an act which, for the reasons set out above, does not constitute an act capable of having, in relation to the situation resulting from the Raw Tobacco Italy decision, legal effects binding on, and capable of affecting the interests of, the applicant (see, to that effect, Commission v Ferriere Nord, paragraph 20 above, paragraph 31). In any event, in so far as the contested letters give a calculation of the default interest at a reduced rate, in accordance with the rate set in the letter notifying the Raw Tobacco Italy decision, they contain nothing in the nature of a decision even as regards the setting of the rate for default interest which has not been challenged in Cases T‑12/06 and T‑34/06 (see, to that effect and by analogy, order in SGL Carbon v Commission, paragraph 20 above, paragraphs 41 to 43).
31 It is therefore for the Commission to decide, after duly informing the applicant, whether or not to continue the recovery procedure. The first paragraph of Article 299 TFEU provides that an act such as the Raw Tobacco Italy decision which imposes a pecuniary obligation is enforceable according to the rules of civil procedure in force in the State in the territory of which enforcement is carried out, by the designated national authority appending the order for its enforcement, as provided by the second paragraph of Article 299 TFEU. It is only when these formalities have been completed on application by the Commission, that, in the present case, the latter may proceed to enforcement in accordance with the national law, by bringing the matter directly before the competent authority. Moreover, although, under the fourth paragraph of that article enforcement may be suspended only by a decision of the Court of Justice, the courts of the country concerned have jurisdiction to review the legality of the enforcement measures.
32 In the light of the foregoing, the Court must find that the contested letters do not constitute acts which may be the subject of an action for annulment under Article 263 TFEU.
33 None of the arguments put forward by the applicant is of such a kind as to call in question that finding.
34 First of all, it should be noted that the applicant’s main argument, namely that the decision allegedly contained in the contested letters altered the date on which the fine was due for payment, is unfounded. The new date for payment of the fine allegedly contained in the contested letters is merely a factual consequence of the applicant’s withdrawal of its action, and not a legal effect thereof.
35 In reality, the date on which the fine is due for payment cannot be altered in any way since the decision imposing the fine, even if not yet definitive, is enforceable under Article 299 TFEU, which means, in principle, that the fine must be paid immediately. By allowing an undertaking which brings an action against a decision imposing a fine on it to avoid paying the fine immediately by lodging a bank guarantee as security for payment of the fine and interest thereon, the Commission could indeed grant the addressee of the decision a privilege for which neither the Treaty nor Regulation No 1/2003 provided (see, to that effect, CB v Commission, paragraph 29 above, paragraph 82). However, where, as in the present case (see paragraph 6 above), the essential condition for suspending payment of the fine ceases to exist, namely the fact that the action brought before the European Union judicature by the addressee of the decision imposing the fine is still pending, that decision becomes definitive and binding with regard to that addressee and the fine must again be paid immediately. Thus, since Case T‑34/06 Universal v Commission has been removed from the register of the General Court, the fact that the action brought by another addressee of the Raw Tobacco Italy decision, in the present case the applicant’s Italian subsidiary, is still pending (Case T‑12/06 Deltafina v Commission [2011] ECR I‑0000, dismissing Deltafina’s action, is the subject of an appeal registered as Case C‑578/11) is not relevant for the purposes of establishing whether the decision allegedly contained in the contested letters is an act which may be the subject of an action for annulment under Article 263 TFEU.
36 As regards the argument that the applicant is directly affected by the result of the action brought by Deltafina, by virtue of the fact that it wholly owns the latter company, it should be pointed out that it is ineffective for the purposes of considering the admissibility of the present action.
37 The question of admissibility which arises in the present case, as it did in Commission v Ferriere Nord, paragraph 20 above, is whether the contested letters contain a decision having legal effects which are binding on, and capable of affecting the interests of, the applicant by bringing about a distinct change in its legal position. Therefore, the answer to such a question concerns only assessment of the nature of the contested letters and their legal effects and not how many undertakings are jointly and severally required to pay the fine. In any event, such an argument relates to a question of substance rather than of procedure, namely, the question of the applicant’s joint and several liability. In that regard, it should be noted that although, as the Commission contends, in the present case the applicant’s obligation to pay the fine cannot depend on the outcome of a different case, such as Case T-12/06, none the less, if Deltafina’s appeal were to result in the Court of Justice annulling in whole or in part the decision imposing the fine on it, the Commission would be required to repay in its entirety the sum corresponding to the principal amount of any fine that might have been paid, by way of joint and several liability, by the applicant, together with default interest on that amount, if such payment were to be considered to be unduly made following any decision to annul or reduce the fine imposed on the subsidiary which has committed the infringement (see, to that effect and by analogy, order of 12 December 2007 in Case T‑113/04 Atlantic Container Line and Others v Commission, not published in the ECR, paragraph 58).
38 With regard to the argument seeking to distinguish between the present case and Commission v Ferriere Nord, paragraph 20 above, in that in the latter case the undertaking concerned was liable for payment of the fine that had been imposed on it by the Commission well before the Commission had taken steps to demand payment of it, whereas in the present case the applicant’s situation changed following withdrawal of its action, so that, according to the content of the contested letters, the fine did not become immediately payable until after Case T‑34/06 was removed from the register, it must be held that that argument is unfounded. Not only is such a conclusion not evident from those letters, but the distinction between those two cases, as argued by the applicant, does not exist, since in both of them the Commission acted after finding that the decision imposing the fine was no longer open to challenge before the European Union judicature.
39 With regard to CB v Commission, paragraph 29 above, also relied upon by the applicant, it should be noted that the applicant’s situation differs from that of the applicant in CB v Commission.
40 In CB v Commission, paragraph 29 above, the Court held that the action for annulment of the letters sent by the Commission was admissible since, as a result of those letters, the applicant realised that the Commission took the view that the obligation to pay default interest from the date on which the fine became payable also extended to the case in which the European Union judicature had subsequently reduced the amount of the fine by upholding in part the action for annulment brought against the decision imposing the fine. More specifically, in that case, the question related to the claim, by means of the letters at issue, for payment of default interest from a certain date on the reduced amount of the fine set by the General Court in its earlier judgment in Joined Cases T‑39/92 and T‑40/92 CB and Europay v Commission [1994] ECR II‑49. That question constituted, according to the Court, a new element in relation not only to the main decision imposing the fine but also to the conditions which, in the letter notifying that decision, the Commission had attached to the suspension of payment of the fine. That is not so, however, in the present case where, as has already been pointed out, the contested letters merely seek payment of the fine by the applicant after withdrawal of its action. In those circumstances, the approach adopted by the Court in CB v Commission, paragraph 29 above, cannot be transposed to the present case.
41 As for the applicant’s argument that the contested letters seek to communicate a new position taken by the Commission whereby the applicant, as the parent company, would not benefit from the successful outcome of Deltafina’s action, it should be pointed out that it is in no way apparent from those letters that, in the event of Deltafina being successful in its action for annulment in Case T-12/06, or in its appeal before the Court of Justice, the applicant would not benefit from such success (see also paragraph 37 above).
42 With regard to the argument that the legal effect of the contested letters is real, in so far as the Commission threatened, inter alia, in its letter of 30 November 2010 to use all means available to it, it should be noted that that was not a legal effect stemming from an alleged Commission decision setting a new date for payment of the fine, but rather a consequence of the fact that the applicant withdrew its action and, in consequence, the Raw Tobacco Italy decision became definitive with regard to the applicant (see paragraphs 34 and 35 above).
43 Lastly, with regard to effective judicial protection, it should be observed, first of all, that the applicant’s argument is unclear. It asserts that, according to the Commission, even if it had not withdrawn its action and had not managed to rebut the presumption of its decisive influence, it would not have benefited from the success of its subsidiary’s action. Apart from the fact that such an argument relates more to the merits of the decision allegedly contained in the contested letters, it should be noted that the enforcement of a decision of the Commission which imposes a pecuniary obligation on a person such as the applicant is governed by Article 299 TFEU which, in its fourth paragraph, provides for effective judicial protection (see, to that effect, Commission v Ferriere Nord, paragraph 20 above, paragraph 32 and the case-law cited).
44 In any event, the fact remains that, although the requirement as to legal effects which are binding on, and capable of affecting the interests of, the applicant by bringing about a distinct change in its legal position must be interpreted in the light of the principle of effective judicial protection, such an interpretation cannot have the effect of setting aside that condition without going beyond the limits of the jurisdiction conferred on the European Union judicature by the Treaty on the Functioning of the European Union (see, to that effect, Commission v Ferriere Nord, paragraph 20 above, paragraph 33 and the case-law cited).
45 Moreover, it should be noted that, even though the applicant is unable to bring an action for annulment of the decision allegedly contained in those letters, it is not denied access to justice since an action for non-contractual liability under Article 268 TFEU and the second paragraph of Article 340 is available if the conduct of the institution in question is of such a nature as to entail liability on the part of the European Union. Such an action is not part of the system of review of the legality of European Union acts with legal effects which are binding on, and capable of affecting the interests of, the applicant, but it is available where a party has suffered harm on account of unlawful conduct by an institution (Case C‑131/03 P Reynolds Tobacco and Others v Commission [2006] ECR I‑7795, paragraphs 82 and 83).
46 It is clear from the foregoing that the contested letters do not contain any decision which may be the subject of an action for annulment under Article 263 TFEU.
47 In the light of the foregoing, the present action must be dismissed as inadmissible, and it is not necessary to examine the other arguments of the Commission concerning admissibility.
Costs
48 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. As the applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the Commission.
On those grounds,
THE GENERAL COURT (First Chamber)
hereby orders:
1. The action is dismissed as inadmissible.
2. Universal Corp. shall pay the costs.
Luxembourg, 12 March 2012.