Opinion of Mr Advocate General Mischo

Mr President,

Members of the Court,

The facts of the present case may be summarized as follows.

Under the terms of an agreement concluded in 1969 between Laminoirs de Strasbourg SA (hereinafter referred to as Laminoirs), a wholly-owned subsidiary of Société union sidérurgique du nord et de l'est de la France Usinor SA, and Straßburger Stahlkontor GmbH (hereinafter referred to as SSK) the latter company is to act as the exclusive distributor of Laminoirs products in the territory of the Federal Republic of Germany, including West Berlin.

After carrying out an investigation at the premises of Laminoirs and SSK, the Commission charged Laminoirs with infringements of the pricing rules of the ECSC Treaty, committed through SSK.

Having decided that the information gathered constituted prima facie evidence of infringement for the purpose of Article 2(7) of Commission Decision No 3716/83/ECSC of 23 December 1983 and having notified Laminoirs of its objections in accordance with Article 36 of the ECSC Treaty, the Commission adopted individual Decision No 5462 of 2 May 1985 provisionally blocking the return of a portion (FF 2745641) of the guarantee lodged by Usinor in the second quarter of 1985.

In the preamble to that decision the Commission states that investigations carried out at the premises of SSK, a selling agency of Laminoirs within the meaning of the third indent of Article 1(2) of Decision No 30/53, as last amended by Decision No 1834/81/ECSC of 3 July 1981, have revealed that in the first quarter of 1984 SSK did not always observe the minimum prices fixed by Decision No 3715/83/ECSC adopted pursuant to Article 61 of the ECSC Treaty.

Usinor claims that the Court should:

As matters of law, once the claim that Decision No 1834/81/ECSC should be declared void is dismissed as inadmissible (see Section A post), the case raises two major questions:

Finally, the submission that Decision No 5462 contains an inadequate statement of reasons will have to be examined (Section D).

There can be no doubt that the application is inadmissible in so far as it seeks the annulment of the third indent of Article 1(2) of Decision No 30/53, as amended by Decision No 1834/81/ECSC, because the one-month period which applicants are allowed under the third paragraph of Article 33 of the ECSC Treaty had expired long before the application was lodged.

However, since the applicant also pleads the illegality of the third indent of Article 1(2) in support of its claim to have individual Decision No 5462 declared void, it may be supposed that the plea is really one of illegality.

It is indeed undeniable that, as the applicant states, there is... a legal connection between the contested individual decision and the general decision pursuant to which the individual measure was notified to the addressee.

Such a plea of illegality could not, of course, lead to the annulment of the general decision at issue but only to that of the individual decision adopted thereunder.

There remains the question whether that plea of illegality is well founded, which must now be examined.

The applicant considers that the Commission misused its powers by using in the application of Article 60 of the ECSC Treaty a definition of control of an undertaking contained in rules for implementing Article 66 of the ECSC Treaty, namely Decision No 24/54 of 6 May 1954.

Decision No 1834/81/ECSC adds to Article 1(2) of Decision No 30/53, which defines the term selling agency for the purposes of that decision, a third indent which refers to:

My immediate reaction is to say that we are faced with no more than a reference to existing legislation, which is a fairly common legal technique which is not open to challenge per se. As is explained in the last recital of its preamble, it is clear that Decision No 1834/81/ECSC refers to Decision No 24/54 solely for the purpose of defining control of an undertaking. In that respect it is of no importance that the two decisions are based on articles of the ECSC Treaty which have separate aims.

It is also of no importance in this case that the legal remedies attached to the two articles are different. Just because Decision No 1834/81/ECSC, which is based on Article 60, borrows a legal definition from Decision No 24/54, which is based on Article 66, it does not follow that the latter article applies and that the legal remedies attached thereto should take precedence over the remedies attached to Article 60.

In the present case the Commission in no way intended to give a decision on the question whether or not the agreement between Laminoirs and SSK constituted a concentration between undertakings — lawful or unlawful — within the meaning of Article 66 of the ECSC Treaty.

Nor do I think that the Commission wished to suggest, even by implication, that exclusive distributorship agreements might as such be regarded as a factor constituting a concentration between undertakings.

In fact, the part played in the present case by the agreement between Laminoirs and SSK is not due to the fact that it is an exclusive distributorship agreement but to the fact that SSK obtains all its supplies from Laminoirs and to other circumstances characterizing the relations between the two firms. (We know that another firm is responsible for selling Laminoirs' products in a special sector of the German market.)

But quite apart from that aspect of legal technique, the question naturally arises whether the Commission could, on the basis of Article 60 of the ECSC Treaty, extend the liability of producer undertakings as regards prohibited pricing practices to their selling agencies displaying the characteristics in question.

The applicant contends that it could not do so, essentially on the following grounds.

1. First of all, it maintains that the context of Article 66 of the ECSC Treaty is such that, in that context, a very broad definition of control of an undertaking is perfectly legitimate. Since the undertakings participating in an illegal concentration are all necessarily at fault, the legislature was entitled to define the control of one undertaking by another in a broad context of contractual relations, without there being any need for one undertaking to have power over the other.

2. The second reason put forward by the applicant is that Decision No 18 34/81/ECSC could be adopted only in conformity with the procedure laid down in Article 95 of the ECSC Treaty, since the Treaty, in Articles 60 and 61 dealing with prices, does not provide for the obligations incumbent on undertakings to be extended to other undertakings under their control.

That being so, are the requirements of that decision fulfilled in this case? In other words, is SSK the selling agency of Laminoirs within the meaning of Decision No 30/53 as amended by Decision No 1834/81/ECSC?

As is apparent from the wording of the latter decision, a distributor undertaking may be treated as the selling agency of a producer undertaking only if two distinct conditions are met, namely,

1. As regards control and the possibility for Laminoirs to determine how SSK shall operate as regards prices or sales, the following points should be made.

2. As far as the existence of direct sales is concerned, first of all, Decision No 30/53, as amended by Decision No 1834/81/ECSC, defines them in the following way:

The applicant further complains that the Commission did not adequately state the reasons for the decision, especially the bases used for calculating the amount of the blocked guarantee and that it merely referred to internal criteria which are not set out elsewhere.

The Commission, which gives particulars about those internal criteria, takes the view that, where a mere protective measure is adopted in order to make a subsequent sanction procedure more effective, the statement of reasons may be limited to the question whether the decision to block the guarantee is in principle well founded, since the suitability of the method of calculation used cannot in any event be appraised except in the light of the determination of the fine itself at a later stage.

According to established case-law, the purpose of the obligation to state the reasons on which an individual decision is based is to enable the Court to review the legality of the decision and to provide the person concerned with sufficient information to make it possible to ascertain whether the decision is well founded or whether it is vitiated by a defect which may permit its legality to be contested.

In this instance, I believe that the statement of reasons for the contested decision meets those objectives. After referring to the legislation in force and stating the infringements objected to, the preamble to Decision No 5462 continues: ... according to Article 64 of the ECSC Treaty, those infringements may be penalized by a fine not exceeding twice the value of the offending sales; the extent of the prohibited underpricing is DM595817, or FF 1830427 when converted at the average exchange rate of the European currency unit in the first quarter of 1984; the Commission could, on the basis of its internal criteria for the fixing of fines for infringement of Article 61 of the ECSC Treaty, impose a fine of FF 2745641; consequently, it would be proper to block provisionally the return of the guarantee provided by Usinor for the second quarter of 1985 in an amount equivalent to the aforesaid amount.

The Commission thus clearly defined the reference criteria used for fixing the amount of the guarantee. Those criteria, which form the limits, so to speak, within which the blocked sum must be fixed, are Article 64 of the ECSC Treaty and the amount by which prices are alleged to have been undercut.

The fact that it did not expressly state that it had increased that amount by 50% is not, in my view, an adequate ground for judging the statement of reasons to be insufficient. The rate of increase applied to the amount by which prices were undercut can be determined by a simple calculation.

Furthermore, the internal criteria referred to in the decision relate only to the fixing of the amount of the fine which the Commission might subsequently impose.

Moreover, the adoption of the contested decision was preceded by a series of contacts, letters and hearings, so that the applicant, which was thus closely involved in the procedure culminating in that decision, certainly had the opportunity to gather all the necessary information on the Commission's relevant practices and methods.

Finally, Article 2(7) of Decision No 3716/83/ECSC, which served as the basis for the contested decision, merely requires that the amount of the guarantee blocked shall be an appropriate amount. That amount is certainly appropriate if it does not exceed the limits mentioned above.

Consequently, in my view, the allegation that the statement of reasons is inadequate cannot be accepted either.

III — Conclusion

For all those reasons I propose that the Court should:

1 Translated from the French.

2 Commission Decision No 3716/83/ECSC of 23 December 1983 establishing a guarantee system for certain steel products and a system for the verification of the minimum prices (Official Journal 1983, L 373, p. 5).

3 Decision No 30/53 of 2 May 1953 on practices prohibited by Article 60(1) of the Treaty in the common market for coal and steel (Official Journal, English Special Edition 1952-58, p. 9). For a codified version dated 20 January 1964, see Official Journal 1963, p. 2980.

4 Commission Decision No 1834/81/ECSC of 3 July 1981 (Official Journal 1981, L 184, p. 7).

5 Statement of Reply, p. 3.

6 Decision No 24/54 of 6 May 1954 laying down, in implementation of Article 66 (1) of the Treaty, a regulation on what constitutes control of an undertaking (Official Journal, English Special Edition 1952*58, p. 16).

7 Emphasis added.

8 Application, p. 11.

9 Statement of defence, p. 7.

10 Judgment of 11 October 1984 in Case 103/83 Ulinor v Commission [1984] ECR 3483

11 The Commission cannot apply the definition of a group of undertakings, laid down by the Treaty in tbe context of the rules governing mergers and concentrations, to situations other than those referred to in Article 66 and thereby ignore the provisions of the Treaty and the case-law of the Court. ([1984] ECR, at p. 3486).

12 Commission Decision No 1836/81/ECSC of 3 July 1981 on the obligations of distributive undertakings to publish pricelists and conditions of sale and on practices prohibited for these undertakings (Official Journal 1981, L 184, p. 13).

13 Decision No 19/63 of 11 December 1963 amending Decision No 30/53 of 2 May 1953 (Official Journal, English Special Edition 1963-64, p. 65).

14 Whereas producer undertakings are also subject to this requirement where they do not sell their products themselves but employ selling agencies to do so; whereas, if it were not so, such separation between production and distribution operations would in so far as it exists have the effect of nullifying the prohibition on discrimination by producer undertakings.

15 Case 20/59 Italy v High Authority [I960] ECR 325. at p. 336; Case 8/55 Fédération charbonnière de Belgique v High Authority [1954-56] ECR 292, ai p. 299, Casc 25/59 Netherlands v High Authority [1960] ECR 355, al p. 372.

16 Commission Recommendation No 1835/81/ECSC of 3 July 1981 to the Member States on the obligation to publish pricelists and conditions of sale and on prohibited practices in the steel trade (Official Journal 1981, L 184, p. 9).

17 Judgment of 28 March 1984 in Case 8/83 Bertoli v Commission [1984] ECR 1649, paragraph 12 at p. 1660.

18 In Bertoli, cited above, the Court once again stated that 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 (paragraph 13 of the Decision). In its judgment of 11 December 1980 in Case 1252/79 Lucchini v Commission [1980] ECR 3753, the Court held more particularly: The statements of the reasons on which a decision imposing a fine for infringement of the ECSC rules on minimum prices is based, although succinct, must be considered to be sufficient where the undertaking to which it is addressed has participated in the procedure whereby the decision in question was -drawn up and has been informed of the method of calculating the disputed underpricing (paragraph 3 of the summary; see also paragraph 14 of the Decision).