Avis juridique important

Judgment of the Court of 11 June 1991. - Commission of the European Communities v Council of the European Communities. - Directive on waste from the titanium dioxide industry - Legal basis. - Case C-300/89. European Court reports 1991 Page I-02867 Swedish special edition Page I-00199 Finnish special edition Page I-00211

Summary Parties Grounds Decision on costs Operative part

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1. Measures adopted by the institutions - Choice of legal basis - Criteria

2. Measures adopted by the institutions - Choice of legal basis - Powers of the institution based on two provisions of the Treaty - Joint legal basis - Limitation - Joint basis prejudicial to the Parliament' s participation in the legislative process

(EEC Treaty, Arts 100a, 130s and 149(2) )

(EEC Treaty, Arts 100a, 130r and 130s; Council Directive 89/428/EEC)

1. In the context of the organization of the powers of the Community the choice of the legal basis for a measure may not depend simply on an institution' s conviction as to the objective pursued but must be based on objective factors which are amenable to judicial review. Those factors include in particular the aim and content of the measure.

2. Where an institution' s power is based on two provisions of the Treaty, it is bound to adopt the relevant measures on the basis of the two relevant provisions. However, where, as in the case of Article 100a of the Treaty, one of the enabling provisions requires recourse to the cooperation procedure provided for in Article 149(2) of the Treaty, on conclusion of which the Council may act by a qualified majority provided that it intends accepting the amendments proposed by the Parliament and put forward by the Commission, and the other provision, as in the case of Article 130s, requires the Council to act unanimously after merely consulting the European Parliament, use of both of them as a joint legal basis would divest the cooperation procedure of its very substance, the purpose of that procedure being to increase the involvement of the European Parliament in the legislative process of the Community. That participation reflects a fundamental democratic principle that the peoples should take part in the exercise of power through the intermediary of a representative assembly. It follows that in such a case recourse to a dual legal basis is excluded and that it is necessary to determine which of those two provisions is the appropriate legal basis.

3 In view of the fact that, in the first place, it is apparent from the very terms of Article 130r(2) of the Treaty that a Community measure cannot be covered by Article 130s merely because it pursues, among others, objectives of environmental protection, secondly, that action intended to approximate, in a given industrial sector, national rules concerning production conditions which were adopted for reasons relating to environmental protection but are liable to lead to distortions of competition, falls within the scope of Article 100a, since it is conducive to the attainment of the internal market, and, finally, that the objectives of environmental protection referred to in Article 130r may be effectively pursued by means of harmonizing measures adopted on the basis of Article 100a, the Council should have used Article 100a as the legal basis for Directive 89/428/EEC on procedures for harmonizing the programmes for the reduction and eventual elimination of pollution caused by waste from the titanium dioxide industry. Since the Council wrongly based the directive on Article 130s, the directive must be annulled.

In Case C-300/89,

Commission of the European Communities, represented by Ricardo Gosalbo Bono and Alain von Solinge, members of its Legal Department, acting as Agents, with an address for service in Luxembourg at the office of Guido Berardis, also a member of the Commission' s Legal Department, Wagner Centre, Kirchberg,

applicant,

supported by

European Parliament, represented by its jurisconsult, Jorge Campinos, assisted by Johann Schoo and Kieran Bradley, members of the Parliament' s Legal Department, acting as Agents, with an address for service in Luxembourg at the Secretariat General of the Parliament, Kirchberg,

intervener,

v

Council of the European Communities, represented by Arthur Alan Dashwood, a Director in the Council' s Legal Department, and Jill Aussant, a Principal Administrator in the same department, acting as Agents, with an address for service in Luxembourg at the office of Joerg Kaeser, Manager of the Legal Directorate of the European Investment Bank, 100 Boulevard Konrad Adenauer,

defendant,

APPLICATION for the annulment of Council Directive 89/428/EEC of 21 June 1989 on procedures for harmonizing the programmes for the reduction and eventual elimination of pollution caused by waste from the titanium dioxide industry (Official Journal L 201, p. 56),

THE COURT,

composed of: O. Due, President, G.F. Mancini, T.F. O' Higgins, J.C. Moitinho de Almeida, G.C. Rodríguez Iglesias and M. Díez de Velasco (Presidents of Chambers), Sir Gordon Slynn, C.N. Kakouris, R. Joliet, F.A. Schockweiler and M. Zuleeg, Judges,

Advocate General: G. Tesauro,

Registrar: H.A. Ruehl, Principal Administrator,

having regard to the Report for the Hearing,

after hearing oral argument presented by the parties at the hearing on 30 January 1991, at which the Commission was represented by R. Gosalbo Bono and J. Amphoux, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 13 March 1991,

gives the following

Judgment

1 By application lodged at the Court Registry on 28 September 1989, the Commission of the European Communities brought an action under the first paragraph of Article 173 of the EEC Treaty for the annulment of Council Directive 89/428/EEC of 21 June 1989 on procedures for harmonizing the programmes for the reduction and eventual elimination of pollution caused by waste from the titanium dioxide industry (Official Journal L 201, p. 56).

2 That directive, which was unanimously adopted by the Council on the basis of Article 130s of the EEC Treaty, "lays down ... procedures for harmonizing the programmes for the reduction and eventual elimination of pollution from existing industrial establishments and is intended to improve the conditions of competition in the titanium dioxide industry" (Article 1). For that purpose, it establishes harmonized levels for the treatment of different kinds of waste from the titanium dioxide industry. Thus, for certain waste from existing establishments using particular processes, a total prohibition is imposed (Articles 3 and 4). On the other hand, for other waste from existing establishments, the directive lays down maximum values for harmful substances (Articles 6 and 9).

3 It is apparent from the documents before the Court that the contested measure derived from a proposal for a directive presented by the Commission on 18 April 1983 on the basis of Articles 100 and 235 of the EEC Treaty. Following the entry into force of the Single European Act, the Commission changed the legal basis to Article 100a of the EEC Treaty, which had been inserted by the Single European Act. At its meeting of 24 and 25 November 1988, the Council nevertheless arrived at a common position whereby the directive would be based on Article 130s of the EEC Treaty. Despite the objections voiced by the European Parliament which, having been consulted by the Council pursuant to Article 130s, considered the legal basis proposed by the Commission to be appropriate, the Council adopted the directive at issue on the basis of Article 130s.

4 Taking the view that Directive 89/428/EEC lacked a valid legal basis, in that it was based on Article 130s but should have been based on Article 100a, the Commission brought the present action for annulment.

5 By order of 21 February 1990, the Parliament was granted leave to intervene in support of the applicant.

6 Reference is made to the Report for the Hearing for a fuller account of the facts of the case, the course of the procedure and the pleas and arguments of the parties, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.

7 The Commission, supported by the Parliament, claims that the directive, although contributing to environmental protection, has as its "main purpose" or "centre of gravity" the improvement of conditions of competition in the titanium dioxide industry. It is therefore a measure concerning the establishment and functioning of the internal market, within the meaning of Article 100a, and should therefore have been based on the latter enabling provision.

8 The Commission states that the very text of Articles 100a and 130s shows that the requirements of environmental protection form an integral part of the harmonizing action to be taken on the basis of Article 100a. It follows, according to the Commission, that Article 100a, which relates to the establishment and functioning of the internal market, constitutes a lex specialis in relation to Article 130s, the latter article not being intrinsically directed towards the attainment of that objective.

9 The Council, for its part, contends that Article 130s is the correct legal basis for Directive 89/428/EEC. Whilst conceding that that directive is intended also to harmonize conditions of competition in the industrial sector concerned and thus to foster the establishment and functioning of the internal market, it considers that the "centre of gravity" of the contested measure is the elimination of the pollution caused by waste from the titanium dioxide manufacturing process. That objective is one of those referred to in Article 130r, which are pursued by means of measures adopted under Article 130s.

12 As regards its content, Directive 89/428/EEC prohibits, or, according to strict standards, requires reduction of the discharge of waste from existing establishments in the titanium dioxide industry and lays down time-limits for the implementation of the various provisions. By thus imposing obligations concerning the treatment of waste from the titanium dioxide production process, the directive conduces, at the same time, to the reduction of pollution and to the establishment of greater uniformity of production conditions and therefore of conditions of competition, since the national rules on the treatment of waste which the directive seeks to harmonize have an impact on production costs in the titanium dioxide industry.

14 Article 130s of the Treaty provides that the Council is to decide what action is to be taken by the Community concerning the environment. Article 100a(1), for its part, is concerned with the adoption by the Council of measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market. According to the second paragraph of Article 8a of the EEC Treaty, that market is to comprise "an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured". By virtue of Articles 2 and 3 of the Treaty, a precondition for such a market is the existence of conditions of competition which are not distorted.

16 It follows that, in view of its aim and content, the directive at issue displays the features both of action relating to the environment with which Article 130s of the Treaty is concerned and of a harmonizing measure which has as its object the establishment and functioning of the internal market, within the meaning of Article 100a of the Treaty.

23 Secondly, as the Court held in its judgments in Cases 91/79 and 92/79 Commission v Italy [1980] ECR 1099 (paragraph 8) and 1115 (paragraph 8), provisions which are made necessary by considerations relating to the environment and health may be a burden upon the undertakings to which they apply and, if there is no harmonization of national provisions on the matter, competition may be appreciably distorted. It follows that action intended to approximate national rules concerning production conditions in a given industrial sector with the aim of eliminating distortions of competition in that sector is conducive to the attainment of the internal market and thus falls within the scope of Article 100a, a provision which is particularly appropriate to the attainment of the internal market.

25 In view of all the foregoing considerations, the contested measure should have been based on Article 100a of the EEC Treaty and must therefore be annulled.

Costs

26 Pursuant to Article 69(2) of the Rules of Procedure the unsuccessful party is to be ordered to pay the costs. Since the Council has failed in its submissions, it must be ordered to pay the costs, including those of the intervener.

On those grounds,

THE COURT

hereby:

1. Annuls Council Directive 89/428/EEC of 21 June 1989 on procedures for harmonizing the programmes for the reduction and eventual elimination of pollution caused by waste from the titanium dioxide industry;

2. Orders the Council to pay the costs, including those of the intervener.