Report for the Hearing in Case C-354/89
I — Facts
1. Under Regulation (EEC) No 517/72 of the Council of 28 February 1972 on the introduction of common rules for regular and special regular services by coach and bus between Member States (Official Journal, English Special Edition 1972 (I), p. 143), regular and special regular services are made subject to a system of authorization. Decisions concerning, in particular, applications to introduce a regular or special regular service are taken by common agreement between the Member States within which passengers are taken up and set down. If negotiations designed to reach an agreement between Member States prove unsuccessful, the dispute in question may, at the request of any Member State concerned, be referred to the Commission.
2. On 9 January 1986 Autocars Emile Frisch S. à r. 1., a company established under Luxembourg law and having its registered office in Luxembourg (hereinafter referred to as Frisch), submitted to the Luxembourg Government an application for authorization to introduce a special regular service to transport workers from Thil and certain other localities in that part of France to the Villeroy et Boch porcelain factory in Luxembourg (hereinafter referred to as Villeroy et Boch). Frisch proposed to operate two daily services in each direction, departing from Thil at 4.20 a.m. and 12.20 p.m. and from Luxembourg at 2.00 p.m. and 10.00 p.m. respectively in order to transpon workers to and from the factory in time for the shifts operating from 6.00 a.m. to 2.00 p.m. and from 2.00 p.m. to 10.00 p.m. Villeroy et Boch, it was claimed, supported the application by Frisch and were prepared to contribute to the transport costs of those workers. On 5 March 1987 Frisch submitted a fresh application to introduce a special regular service which differed from the abovementioned one in that it would also take workers to and from the ARBED factory at Dommeldange. ARBED was not prepared to contribute to the travel costs of those workers.
3. The Commission, by Decision 89/524/EEC of 7 September 1989 on a dispute between Luxembourg and France on the establishment of a special regular passenger service between these two States (Official Journal 1989 L 272, p. 18), decided that:
4. Much earlier, in 1982, by Decision 82/595/EEC of 10 August 1982 settling the dispute between the Grand Duchy of Luxembourg and the French Republic over the renewal of authorizations for certain special regular services (Official Journal 1982 L 244, p. 32), the Commission had resolved a dispute between those two States involving the same companies, Frisch and Schiocchet, over the renewal of authorizations for certain special regular services.
II — Procedure before the Court
5. The application made by Schiocchet was lodged at the Court Registry on 20 November 1989. The written procedure followed the normal course.
6. Upon hearing the report of the Judge-Rapporteur and the views of the Advocate General, the Court decided to open the oral procedure without any preparatory inquiry.
7. Pursuant to Article 95(1) and (2) of the Rules of Procedure, the Court, by decision of 7 November 1990, assigned the case to the Second Chamber.
HI — Forms of order sought by the parties
8. Schiocchet, the applicant, claims that the Court should:
9. The Commission, the defendant, contends that the Court should:
IV — Submissions and arguments of the parties
A — Admissibility
10. Schiocchet considers that it has an interest in bringing suit for a declaration that Decision 89/524 is void. That decision, it contends, is designed to allow Frisch, a direct competitor of Schiocchet, to introduce a special regular service which would at least partially overlap with services already provided by Schiocchet. Schiocchet's position as an operator of cross-border services would be improved if the contested decision were to be annulled. In those circumstances, Schiocchet believes that it has a sufficient interest in securing the annulment of Decision 89/524.
11. Schiocchet considers that it is directly and individually affected by the contested decision, even though that decision is not addressed to it. The authorization conferred on the basis of Decision 89/524 directly affects Schiocchet by reason of the regular passenger services which the applicant alone operates in the area and which would be in direct competition with the service authorized by the decision at issue. In support of its contentions, Schiocchet refers to the judgment of the Court in Case 112/77 Töpfer v Commission [1978] ECR 1019.
B — Substance
12. Schiocchet begins by arguing that the Commission ought to have taken into account Frisch's long tradition of illegality and the consistent and scrupulous compliance by Schiocchet with the applicable rules.
13. Secondly, Schiocchet considers that Frisch is not legally entitled to apply for the exclusive operation of the Thil — Luxembourg service, on the ground that the special regular service proposed by Frisch does not satisfy the criteria set out in Article 8 of Regulation No 517/72 and, more particularly, those contained in paragraph 2(a) of that article.
14. Finally, Schiocchet takes the view that the exclusive operation by Frisch of the Thil — Luxembourg service ousts it from that service and creates a monopoly in favour of Frisch. This, it is argued, is particularly unfair because from Errouville the service in question follows the Boulange — Luxembourg route operated by Schiocchet, the route in question is one along which Schiocchet alone has put its authorization to proper effect and, finally, the route is a natural extension of the Boulange — Luxembourg route in respect of which Schiocchet applied for authorization before Frisch. The Boulange — Luxembourg service is the only one operated by Schiocchet, whereas Frisch operates four. This imbalance is aggravated by the fact that Villeroy et Boch puts pressure on its employees to use the service provided by Frisch. Even if Community rules in respect of international transport were designed to ensure that services should be organized in accordance with needs, while maintaining normal conditions of competition, such rules should not have the effect of reducing to the point of nonexistence the services offered by a transport company which has always taken pains to comply with such rules. The contested decision has the direct and immediate effect of removing all competition with Frisch, which thus finds itself in fact and for the future in a monopoly situation. The Commission's decision simply ousts Schiocchet. Conditions of normal competition in the coach transport sector in this region can no longer be assured.
15. The Commission points out that from 21 January 1977 Frisch had benefited from regular authorizations to operate four cross-border services, authorizations which France had subsequently refused to renew. Since 10 August 1982, Frisch has once again benefited from regular authorizations and in so far as the submission alleging unlawful behaviour on the part of Frisch refers to events predating Decision 82/595 it is to be rejected since that decision had the effect of rectifying Frisch's position.
16. The Commission maintains that it adopted Decision 89/524 in accordance with the principles set out in Article 8 of Regulation No 517/72.
17. The Commission emphasizes that the application made by Frisch related to the introduction of a special regular service and for that reason did not have to be examined in the light of the state of the passenger transport market in the areas in question within the meaning of Article 8(2)(b) of Regulation No 517/72, applicable to applications concerning the introduction of a regular service within the meaning of Regulation No 117/66. Consequently, the submission made by Schiocchet to the effect that the contested decision creates a monopoly in favour of Frisch lacks any foundation.
1 Language of the case: French.