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Opinion of Mr Advocate General Darmon delivered on 21 October 1986. - Ferriera Valsabbia SpA v Commission of the European Communities. - Common market in steel - Fine for exceeding production and delivery quotas. - Case 268/84.

European Court reports 1987 Page 00353

Opinion of the Advocate-General


Mr President,

Members of the Court,

1 . In this action Ferriera Valsabbia SpA is primarily seeking the annulment of a decision of 27 September 1984 ( hereinafter referred to as "the contested decision ") whereby the Commission of the European Communities imposed on it a fine of 70*875*ECU .

That decision was adopted under Article 58 of the ECSC Treaty and Decision No 1831/81/ECSC of 24 June 1981 ( hereinafter referred to as "the general decision "), which implemented Article 58 and was amended by Decision No 533/82/ECSC . Applicable with effect from 1 July 1981, that general decision, adopted for the purpose of overcoming the effects of the crisis caused by overproduction in the steel industry, required the undertakings concerned not to exceed, in respect of each category of products, a certain production quota and to dispose of only a specified part of that quota on the common market . In principle, therefore, the delivery quota is drawn from the production quota .

There is an exception to that rule resulting not from any legislative provision but from the practice of the Commission . The latter accepts that the delivery quota may exceptionally be exceeded in the case of stock already held in each undertaking on 30 June 1981, the eve of the entry into force of the new rules . That "concession" is somewhat in the nature of a transitional measure making it possible for undertakings to avoid being penalized for their activities before the date on which the new rules came into force .

2 . In regard to products in Category V ( concrete reinforcing bars ), the Commission complained that Ferriera Valsabbia, during the first half of 1982, exceeded its delivery quota for the first quarter by 979 tonnes and that for the second quarter by 1*239 tonnes . The total excess was therefore 2*218 tonnes .

The applicant company did not contest the existence of that excess and the Commission was prepared to apply the abovementioned concession . The dispute between them arises quite simply from a difference in their assessment of the stocks of the products in question held on 30 June 1981 .

3 . According to the Commission, that stock amounted to 1*273 tonnes which, when deducted from the 2*218 tonnes of excess deliveries, leaves a quantity of 945 tonnes in respect of which the contested fine, calculated on the basis of 75*ECU per tonne, was imposed .

Ferriera Valsabbia claims that in addition to the 1*273 tonnes, it had in its warehouse on the relevant date a substantial quantity of products, including in particular 4*749 tonnes which were delivered outside the common market after 30 June 1981, principally to the Swiss undertaking Philipp Brothers .

4 . After the presentation of the facts during the written procedure and at the hearing on 13 March 1986, a number of uncertainties remained, concerning essentially the method used by the Commission to arrive at the figure of 1*273 tonnes . The further hearing on 23 September 1986, ordered by the Court, cleared up those uncertainties and made it possible for the dispute to be resolved . It became clear that the the question of whether the invoices for the products sold to Philipp Brothers were definitive or pro forma invoices - I would refer in this regard to the discussion contained in the Report for the Hearing - was not as important as the parties had thought .

The Commission had already stated that it "reconstituted" the stock held on 30 June 1981 on the basis of invoices and not of delivery dockets . At the hearing, in the course of further explanations, it clearly admitted that it did not contest that the goods in question were physically part of the applicant' s stocks on the abovementioned date . It merely indicated that it had refused to take account of them on the following grounds :

( i ) they had already been sold to Philipp Brothers and no longer belonged to Ferriera Valsabbia;

( ii ) they were to be delivered to a non-member country .

5 . That reasoning is unconvincing . As the Commission' s representative in fact admitted at the hearing, the goods in question are fungible or interchangeable . In those circumstances, it cannot be stated that a specified and identifiable quantity of nearly 5*000 tonnes had, on 30 June 1981, ceased to belong to the applicant by reason of the sale to Philipp Brothers . Moreover, there is no reason not to believe that the goods which were the subject of that transaction, delivered during the second half of 1981, were drawn, in whole or in part, from stocks produced after that date . The Commission does not allege that the applicant exceeded its production quota and that, it must be pointed out, renders nugatory the argument based on the fact that the goods were to be shipped to non-member countries . Furthermore, it is my understanding from the explanations made at the hearing by the Commission' s representative that the country of destination was never taken into account in assessing, in comparable situations, the stock on hand on 30 June 1981 .

The Commission, which, as I have indicated, has never refused in principle to apply the aformentioned extra-statutory concession to Ferriera Valsabbia, cannot therefore, without infringing a rule which it itself has laid down, leave out of account the quantity of fungible goods covered by the contract in question, notwithstanding the fact that the contract was concluded before 30 June 1981, once it is common ground that delivery took place after that date .

6 . The applicant is thus entitled to have the contested decision declared void and it is therefore superfluous to consider the claims which it submitted in the alternative .

If the Court' s judgment is in accordance with this Opinion, the Commission should be ordered to pay the costs .

(*) Translated from the French .