Court of Justice 15-07-1960 ECLI:EU:C:1960:34

Data

Court: Court of Justice

Case date: 15 juli 1960

Verdict

JUDGMENT OF 15.7.1960 — CASE 25/59 NETHERLANDS v HIGH AUTHORITY

In Case 20/59

GOVERNMENT OF THE KINGDOM OF THE NETHERLANDS, represented by W. Riphagen, Legal Adviser to the Ministry of Foreign Affairs, assisted by Professor P. Sanders, Advocate of Rotterdam, with an address for service in Luxembourg at the Netherlands Embassy

applicant,

supported by

COÖPERATIEVE VERVOERSONDERNEMING INTERLIMBURG CA, Venlo, represented by its Managing Board, composed of F.G. van der Ven (President), G.W. Helmes (Vice-President) and F. Faessen (Member),
REINHOLD COUMANS, proprietor of the R. Coumans Transport Undertaking, Geleen,
VENNOOTSCHAP ONDER FIRMA M. OVERDORP EN ZOON, Velsen-IJmuiden O., represented by its managing partners, Machiel Overdorp and Leendert Overdorp,
ROTTERDAMSCHE DROOGDOKMAATSCHAPPIJ NV, Rotterdam, represented by its director, Kornelis van der Pols,
VERENIGING VAN METAAL-INDUSTRIEËN, The Hague, having legal personality, represented in accordance with its articles of association by Dr J.C. Hooykaas, General President, and M.M. Heinsius, Secretary, and assisted by G. de Grooth, Buitengewoon Hoogleraar at the State University of Leyden, with an address for service in Luxembourg at the Chambers of J. Loesch,

interveners,

v

HIGH AUTHORITY OF THE EUROPEAN COAL AND STEEL COMMUNITY, represented by its Legal Adviser, R. Baeyens, acting as Agent, assisted by C.R.C. Wijckerheld Bisdom, Advocate at the Netherlands Cour de Cassation, with an address for service in Luxembourg at its offices at 2 place de Metz,

defendant,

THE COURT

composed of:

A.M. Donner, President,

L. Delvaux and R. Rossi, Presidents of Chambers,

O. Riese and Ch. L. Hammes (Rapporteur), Judges,

Advocate-General: K. Roemer

Registrar: A. Van Houtte

gives the following

JUDGMENT

Issues of fact and of law

I — Facts

The facts underlying the present dispute can be summarized as follows:

Before any action was taken by the High Authority the road transport situation in the Netherlands, which was governed by Royal Decree of 16 January 1954, was as follows: legislation and regulations in force laid down maximum scales for inland transport and minimum and maximum rates for international transport (‘margeta-rief’); the rates actually charged were not published and, because of the legal provisions in force, carriers enjoyed comparative freedom.

On 21 February 1956, the Committee of Experts on Transport, set up pursuant to Article 10 of the Convention on the Transitional Provisions, submitted its report relating inter alia to the publication of road transport rates and conditions.

On 12 July 1956, the High Authority sent the report to the governments of the Member States. On the basis of the report, negotiations took place in the special Council of Ministers with a view to the introduction of common measures for the application of the requirements of the Treaty relating to road transport within the Community for hire or reward. In the negotiations, the representatives of the Government of the Netherlands refused to adopt the proposals made to them and submitted various counter-proposals to their colleagues. The negotiations produced no agreement.

By letter dated 12 August 1958 the High Authority requested the governments of the six Member States to take the necessary measures to fulfil the obligation of publishing the transport scales and rates in accordance with the third paragraph of Article 70 of the Treaty, that is to say, subject to conditions meeting the requirements of the functioning of the Common Market. In this letter, the High Authority stated in particular:

‘3.
The High Authority leaves it to the government … to determine the appropriate means for achieving the abovementioned objectives. There are three ways in which this can be done:

The competent authority may publish a transport tariff and ensure that transport undertakings comply with it.

The competent authority may require carriers to publish in a satisfactory form or to communicate to the High Authority the transport tariffs which they have themselves laid down and which they apply in carrying on their business.

In the absence of such tariffs or when they include minimum or maximum rates, the transport rates and conditions may be notified to the High Authority immediately after the conclusion of each contract of carriage.

In this event, the necessary steps must be taken to send to the High Authority immediately after the conclusion of each contract of carriage:

either a duplicate or certified copy of the waybill or contract of carriage;

or a document signed by the consignor and the carrier and containing the essential information relating to the transport rates and conditions.

These documents must contain the following minimum information:

place and date of execution of the document,

name and address of the consignor,

name and address of the carrier,

place of loading and place of delivery of the goods;

name and address of the consignee,

description of the goods,

gross weight of the goods or quantity ex

pressed in other terms,

transport rate and other charges,

distance travelled in kilometres, and where appropriate: frontier crossing points.’

‘5.
Where the government … does no more than require the immediate notification of contracts of carriage already concluded (Paragraph 3 (c) above), the High Authority will follow the application of this method closely in order to determine whether it enables the abovementioned objectives of the Treaty to be satisfactorily attained. If it should appear after a period not exceeding four months that this is not the case, the High Authority will consider whether and, if so, what other measures appear to be necessary.’

The High Authority concluded the letter by requesting the Netherlands Government:

to inform it before 1 December 1958 of the measures which have been adopted at that date relating to carriage by road for hire or reward to fulfil, having regard to the foregoing particulars, the provisions of the Treaty and in particular Articles 2, 3, 4, 5, 60 and 70;

or to send it by the same date the comments which the Netherlands Government proposes to submit under the second sentence of the first paragraph of Article 88 of the Treaty.’

By letter of 29 November 1958 the Nether lands Minister for Transport and Inland Waterways expressed his readiness to take the necessary steps to cause the transport rates and conditions to be communicated to the High Authority after the conclusion of contracts of carriage. In so doing he thought he was following the third course suggested by the High Authority.

Elsewhere in the letter, the Minister emphasized that, in connexion with road transport, the Netherlands Government did not consider itself to be subject to obligations other than those the purpose of which was to ‘enable the High Authority to determine whether or not there is discrimination within the meaning of the first and second paragraphs of Article 70’ and refused to accept that Article 60 of the Treaty could give rise to specific obligations in connexion with transport.

Finally, the Minister requested that the information supplied to the High Authority should be treated as confidential and expressed his willingness to consider any changes that might have to be made in the proposed method of notifying road transport rates and conditions.

Following its letter of 29 November 1958, the Netherlands Government amended the Royal Decree of 16 January 1954 relating to carriage of goods by road by Royal Decree of 24 December 1958(Staatsblad of the Kingdom of the Netherlands, 1958, No 686). Paragraphs 3 and 4 were added to Article 138 and they provide as follows:

‘3.
In so far as this is necessary for the execution of international contracts, the grantee must, in accordance with the requirements to be laid down by our Minister, communicate to him and to the authorities and officials designated by him any information which he considers necessary, including financial information, relating to the carriage of goods to be designated by our Minister. These requirements and a list of the goods referred to above will be published in the Journal Officiel.
4.
The authorities and officials referred to in paragraph 3 above shall, except in respect of our Minister, keep confidential everything which is brought to their notice in accordance with the provisions of the foregoing paragraph.’

This Royal Decree entered into force on 22 January 1959, namely two days after its publication in the Staatsblad.

On 18 February 1959, the High Authority adopted Decision No 18/59 ‘on the publication or notification to the High Authority of the scales, rates and all other tariff rules of every kind applied to the carriage by road of coal and steel within the Community for hire or reward’.

This decision was based on the following considerations in particular:

‘Whereas this obligation must be fulfilled in such a way as to ensure the functioning of the Common Market as provided for by the other provisions of the Treaty and in particular Articles 4, 5, 60 and 70.’

‘Whereas the functioning of the Common Market requires in particular:

that there should be control over any discriminatory scales, rates and other tariff rules applied to transport within the Common Market;

that producers should be able to draw up their price lists with full knowledge of the delivery prices of their own products, even in cases where the contract of carriage is concluded with the consignee.

that producers should be able to draw up their price lists with full knowledge of the delivery prices of the products of producers in competition with them.

that producers should be able to align their delivery prices on those of other producers.’

‘Whereas these conditions can be fulfilled only if the producers and consumers of the Common Market can acquire knowledge of the scales, rates and all other tariff rules of every kind applied to the carriage by road of coal and steel within the Community for hire or reward, whether these scales, rates and other tariff rules were fixed or standardized by the State or drawn up in conjunction with it, or freely determined by the transport undertakings without any intervention on the part of the State.’

In addition to these considerations, the High Authority went in some detail into the historical background to Decision No 18/59. It was based upon Articles 2, 3, 4, 5, 15, 60, 70, 81, 86 and 88 of the Treaty.

In the statement of reasons for the decision, the High Authority considered the attitude adopted by the Netherlands Government and the French Government with regard to the recommendations in paragraph (c). The High Authority concluded that none of the governments

‘has adopted or declared itself prepared to adopt in their entirety the measures necessary to implement one or other of the courses of action suggested by the High Authority and that, although certain Governments have announced the adoption of other measures…, none of these measures is capable of satisfying the conditions and requirements defined above.’

This led the High Authority to find that all the Member States, including the Netherlands State, had failed to fulfil ‘an obligation imposed on them under the ECSC Treaty’.

According to the same statement of reasons, this obligation consisted of the adoption of one of the first two courses of action recommended to Netherlands Government in the letter of 12 August 1958, subject, however, to adjustments in respect of the flexibility of tariffs and the temporary exclusion from these regulations of certain categories of vehicle and certain short-distance transport.

The time-limit for carrying out the Decision was laid down as 30 June 1960.

On 2 April 1959, pursuant to the second paragraph of Article 88 of the Treaty establishing the European Coal and Steel Community, the present application for annulment of the abovementioned decision was entered at the Court Registry.

On 9 November 1959, five Netherlands undertakings lodged an application to intervene at the Registry of the Court in support of the conclusions of the Netherlands Government and the intervention was allowed by order of 19 February 1960.

II — Conclusions of the parties

The applicant seeks annulment of Decision No 18/59 of the High Authority of the European Coal and Steel Community of 18 February 1959 on the publication or notification to the High Authority of the scales, rates and all other tariff rules of every kind applied to the carriage by road of coal and steel within the Community for hire or reward, which was communicated to the Government of the Kingdom of the Netherlands in the High Authority's letter of 25 February 1959 and was published in the Journal Officiel on 7 March 1959; and the applicant claims that the High Authority should be ordered to pay the costs.

The interveners claim that, in accordance with the application of the Netherlands Government, the Court should annul Decision No 18/59 of the High Authority of 18 February 1959 and order the defendant to pay the costs of their intervention.

The High Authority contends that the application of the Government of the Kingdom of the Netherlands should be dismissed as unfounded and that the applicant should be ordered to pay the costs of the proceedings in the main action and that the interveners should be ordered to pay the costs of their intervention.

III — Submissions and arguments of the parties

The submissions and arguments of the parties may be summarized as follows:

1. Lack of competence

A. The applicant denies that Article 88 empowers the High Authority to lay down and specify the obligations imposed on the Governments by virtue of the Treaty on the subject of transport, since the article does not provide for directives to be issued to the Governments but only for their failure to fulfil an obligation to be recorded.

In the case of transport (in contrast with certain other subjects governed by the Treaty), the Treaty does not identify the aims of the Community and gives no power to the High Authority to take compulsory measures.

If the High Authority's view were correct and if Article 88 endowed it with legislative powers which it could exercise as it pleased, it would be difficult to understand why, in other sectors more directly involved with the functioning of the common market in coal and steel, the authors of the Treaty considered it necessary to lay down the Community's aims in binding rules and, subject to certain procedural safeguards, to confer formal powers on the High Authority.

While Article 60 empowers the High Authority to cause prices to be published, Article 88 cannot be wrongly applied for the purposes of indirectly conferring similar powers in relation to freight charges which the authors of the Treaty did not consider it necessary to include in Article 70.

Moreover, it must not be forgotten that Article 10 of the Convention on the Transitional Provisions provides for the establishment of a Committee of Experts responsible for studying the arrangements to be proposed to the Governments in respect of transport in order to attain the objectives set out in Article 70 of the Treaty; it is the duty of the High Authority, on the basis of the Experts' Report, to convene a conference of the Governments.

Finally, it is still open to the defendant to proceed under Article 95 of the Treaty, subject to the safeguards provided by that procedure; if Article 88 is used, this deprives the parties of those safeguards.

This argument is unreservedly adopted by the interveners. In their view, only the obligations provided for under the Treaty are imposed on the States and the authors wrote them into the Treaty because they regarded this as essential or desirable for the proper functioning of the Common Market.

In purporting, in the contested Decision, to impose a general obligation on the States in regard to transport, but only in respect of road transport, the High Authority assumes discretionary powers which it does not possess and, furthermore, is clearly guilty of discriminating between road transport and other forms of transport.

It follows from the foregoing that the contested decision has no legal basis in the Treaty and ought on that ground to be annulled.

The interveners indicate how Article 88 ought to be applied and emphasize that the wrong use of the article can compromise the institutional balance of the Treaty. There is, in a comparable field, support for this view in the recent opinion of the Court which declared that the draft amendment of the Treaty proposed by the High Authority cannot be effected on the basis of the procedure in the third paragraph of Article 95 in circumstances where, in particular, the balance between the powers transferred to the Community and the powers reserved to the Member States is upset.

The defendant replies that the main issue in these proceedings is that of the obligations which the Treaty imposes on the Member States. If the High Authority is correct in its view that Article 70 imposes obligations on the Member States, the decision which it took is justified. The whole object of the statement of reasons required under the first paragraph of Article 88 is to establish the obligation which the High Authority records that a State has failed to fulfil. If the High Authority could do no more than record failure to fulfil an obligation without being able to describe or identify it, Article 88 would have no practical purpose since it would not make it possible to obtain a precise idea of the obligations imposed on the States under the Treaty.

Reference was wrongly made to Article 10 of the Convention on the Transitional Provisions since it is impossible to conclude therefrom that, after the High Authority has unsuccessfully conducted negotiations over a number of years, it should remain inactive and that it has no right to utilize the procedure in Article 88 of the Treaty. Furthermore, it is clear from Article 10 itself that the High Authority can, if need be, act on its own initiative.

There is no relevance in the comparison with Article 60. That article directly empowers the High Authority to make regulations on the subject of the prices and conditions of sale for coal and steel. The High Authority has no such power in the field of transport, where it can take action only through the Member States, if necessary by applying Article 88.

B. According to the applicant the High Authority, in the contested decision, anticipates the common policy on transport, which has to be worked out by the Member States within the framework of the European Economic Community.

The interveners point out that the Treaty establishing the European Economic Community itself imposes on carriers no obligation either to lay down fixed tariffs or to publish them. According to the declaration made to the States General by the Netherlands Government when the Treaty was being ratified, this omission is deliberate. In view of this, the obligation cannot be imposed for the purpose of carrying out the provisions of the Treaty establishing the European Coal and Steel Community.

The defendant replies that, under Article 232 of the Treaty establishing the European Economic Community, the institutions of the European Coal and Steel Community are unchanged. If, in the field of transport, the decisions of the European Coal and Steel Community have a consequential effect on the common policy underlying the European Economic Community (and this has not been proved), it is not clear in what way this situation can impair the validity of those decisions.

C. The applicant protests against the interference by the High Authority with the trading policy of undertakings which do not come within its jurisdiction. Transport undertakings do not fall within the definition given by Article 80 to undertakings within the meaning of the Treaty.

The defendant makes no direct reply to this ground of complaint, probably because the reply given under A to the first complaint of lack of competence is of general application.

2. Infringement of an essential procedural requirement

The applicant and the interveners claim that there has been a failure to fulfil the procedural requirements of Article 88 of the Treaty. They point out that, in its letter of 12 August 1958, the High Authority, in accordance with the procedure laid down in Article .88, gave the Netherlands Government the opportunity to submit its comments in offering it, in common with the other Governments, the choice of three methods whereby it could fulfil its obligations in connexion with road transport.
When the Netherlands Government chose the third method, there was no reaction on the part of the High Authority, nor was there any to the Netherlands Government's letter of 29 November 1958 or when the Royal Decree of 24 December 1958 began putting it into effect, but it took a decision restricting the choice in future to two alternatives only.
Article 88, which lays down a system of sanctions, provides safeguards; the first of these compels the High Authority to obtain the comments which the Member States must submit concerning the obligations which, according to the High Authority, are imposed upon them. If the High Authority sees fit to change its mind on the subject, it must set the procedure of Article 88 in motion once more and invite Governments to submit fresh comments.
The interveners emphasize that the Netherlands Government did not reject the High Authority's proposals. It was in fact the High Authority which changed its view of the situation when it yielded to the wishes expressed by German industry and the French Government. There was, accordingly, no failure on the part of the Netherlands Government.
They further contend that the contested decision makes provisions for other measures of very much wider application and, on account of this, for obligations other than those referred to in the letter of 12 August 1958. With regard to these other measures, which were of an entirely different character, the Governments were not given an opportunity to decide their attitude before publication of the decision and this was a flagrant infringement of Article 88 of the Treaty which, in express terms, prescribes safeguards designed to prevent an infringement of the Treaty being recorded in a decision without further warning. In failing to give Governments the opportunity to comment in advance on the measures imposed upon them by their decision and which, according to the Authority, were binding upon those Governments under the Treaty, the High Authority infringed an essential procedural requirement, in this case Article 88 of the Treaty.
The defendant points out that the Netherlands Government did not in fact accept the third alternative offered in the letter of 12 August 1958 but hedged its choice about with reservations and conditions which were unacceptable; this applies especially to the requirement that the High Authority must treat all information communicated to it as confidential.
Moreover, the disappearance of the third ‘solution’ in Decision No 18/59, the reason for which is made clear in the grounds for the decision, was justified because, judging by the replies which the High Authority received to its letter of 12 August 1958, it could not be regarded as ensuring that the Treaty would be applied.
The comments provided for in the first paragraph of Article 88 are of value only because they enable the State concerned, as well as the High Authority, to make its position clear; it was, therefore, as a result of the comments of the six Governments and, in this particular case, those of the Netherlands Government, which refused to accept the third alternative suggested by the High Authority, that the latter judged it expedient not to repeat it in the contested decision.
Finally, the Netherlands Government nowhere states that it has changed its mind about the proposals of the High Authority contained in Decision No 18/59, which constituted the two first possibilities submitted for its its comments in the letter of 12 August 1958.
Secondly, the interveners, arguing on the basis of the infringement of an essential procedural requirement, contend that an individual decision addressed to the six Member States is in fact a general decision but a decision taken pursuant to the first paragraph of Article 88 can only be an individual decision.
The defendant replies that, since none of the six Governments had expressed their willingness to accept any of the solutions proposed in the letter of 12 August 1958, all the Member States were in an identical position and the contents of the decision adopted by the High Authority in relation to them had obviously to be the same.

3. Infringement of the Treaty

A. Lack of legal basis for Decision No 18/59

The applicant emphasizes that no provision of the Treaty compels transport undertakings, the Governments of the Member States or the High Authority itself to achieve the aims set out in detail in certain provisions of there contested decision.
In particular, Article 70, which envisages a ‘programme’, contains no ‘express rule’ concerning the States or transport undertakings. Although it condemns ‘international’ and national discrimination, this does not constitute authority for the conversion of the concept of non-discrimination into decisions binding on the States and transport undertakings.
In certain fields the principle of non-discrimination is put into effect in the form of express rules but this does not always apply, as becomes clear when comparison is made between Articles 60 and 70 of the Treaty.
Article 60 is concerned with producers and its object is to enable them to take advantage of the possibility of aligning their quotations on those of their competitors (Judgments of 21 December 1954: French Government v High Authority and Italian Government v High Authority). It directly concerns undertakings within the meaning of the Treaty. In order to put the article into effect, the High Authority can directly impose a particular method of calculating prices.
On the other hand, it is impossible to regard Article 70 as a provision which enables the price of transport to be laid down as a hard and fast rule inasmuch as it represents part of the price within the meaning of Article 60, a provision which stands on its own.
There is no comparison whatever between the price of transport and the price of a given quantity of coal or steel. In the European Coal and Steel Community, transport matters are not ‘integrated’ in the same way as coal and steel matters. Each of the six Member States has its own policy on transport matters.
Again while it is relatively easy to work out the real price of coal or steel, the same cannot be said of transport. In view of the fact that there are different methods of transport, that each road transport undertaking is accustomed to the conditions which are peculiar to it (vehicles, stages, etc.), that some undertakings producing coal and steel have their own means of transport, by road or otherwise (‘eigen vervoer’), that all road transport undertakings may at any moment have to face unforeseen difficulties and that, finally, offers from outside the Community can be made on the Common Market, it is obvious that it becomes very difficult to work out the exact price for such transport and that it is impossible to lay down a general tariff in advance.
All these factors were taken into account by the authors of the Treaty when they drafted Article 70 in its present form and made the Governments of the Member States responsible for agreeing on a Community transport policy. Accordingly, it is of no avail to turn to Article 70 for the legal basis which is lacking in Decision No 18/59.
The interveners lay particular stress on the very special character of the road transport business and in general adopt the applicant's arguments.
The defendant replies that publication of prices is of value only if the cost of transport is known.
If it were not, this would mean that all delivery prices would comprise a factor which was unknown as far as third parties were concerned. The principle of publishing correct prices requires publication of prices in the strict sense of the word as well as the rates and conditions of transport. The first paragraph of Article 70 of the Treaty, which constitutes the application of Article 4 (b) in the case of transport, prescribes an objective which can be obtained only if those concerned are in a position to know the tariffs being applied.
The attainment of the Common Market as provided for under the Treaty requires therefore that the scale, rates and other tariff rules applied to the carriage of coal and steel should be laid down (it matters little by whom) in the form of tariffs of general application which are not kept confidential.
If Article 70 was, as the applicant maintains, only a ‘programme’ this would ill accord with the Treaty, whose object is absolute ‘integration’. The High Authority is obliged not only to comply with Article 70, like any other provisions of the Treaty, but also to ensure, where necessary, that all concerned comply with it.
The applicant itself states that the first paragraph of Article 70 repeats in detail what has already been laid down in Articles 3 (b) and 4 (b). But those articles do not consist merely of 'programmes' but are directly applicable (Judgments in Joined Cases 7 and 9/54, Groupement des Industries Siderur-giques Luxembourgeoises v High Authority of the European Coal and Steel Community).
The defendant emphasizes that the first paragraph of Article 70 does not merely repeat the general principles laid down in the above-quoted introductory articles, but specifies them in particular by providing for the ‘application of… rates … for the carriage (of coal and steel)’. It is of little moment whether the obligation to publish the scales is or is not separate from the prohibition of discrimination: if transport rates are not made public, it is impossible to ensure proper control and, consequently, compliance with the principle of non-discrimination.
The defendant contends that there is no substance in the argument of the applicant when it states in effect that the High Authority was wrong not to take account of the number of road haulage undertakings and of their peculiar circumstances and, in consequence, not to establish a ‘system whose effectiveness is 100 % in all circumstances’; the Netherlands Government thus ignores not only the practical situation but also the fact that the High Authority must endeavour to achieve what is, on a reasonable view, practicable ‘in so far as it is not, or not yet, possible to achieve perfection’.
Finally, the defendant states that the fact that regulations were made only for the road transport sector cannot be described as discriminatory, since Decision No 18/59 is merely a stage in the implementation of Article 70.
In the light of all the foregoing considerations the High Authority maintains that the contested decision has a clear legal basis in the Treaty and, in Article 70.
The interveners maintain that Article 5 of Decision No 18/59 imposes three new obligations on the Governments for the purposes of ensuring that the decision is effectively implemented. Not only is it impossible to find any legal basis for these obligations anywhere in the Treaty but, on the contrary, they conflict with Article 86 which, in the interveners' view, binds the Member States only to take the necessary legislative measures to ensure that the obligations arising from the decisions and recommendations of the institutions of the Community are carried out. The High Authority itself claims that the provisions contained in Article 5 of the contested decision are necessary in order to ensure compliance with the requirements imposed on States in Article 2 of the decision; the effect of this is that, since that part of the decision which the defendant itself regards as vital is null and void, the whole decision must also be null and void.
The defendant makes the immediate objection that, in using these arguments, the interveners are relying on a submission which the Netherlands Government itself did not submit and that, for this reason alone, the Court cannot accept it.
Again, if Article 5 did not exist, the remaining articles of the decision would still be absolutely valid; strictly speaking, Article 5 of the decision could even be described as supererogatory.
It is, in fact, obvious that the obligations described in Article 5 are the logical and necessary consequence of the obligations listed in Articles 1 and 2 of the decision.

B. Infringement of the first and second paragraphs of Article 70 of the Treaty

In the applicant's view, the first two paragraphs of Article 70, referring to discrimination, do not require the use of a system such as that developed by the Authority in the contested decision; the High Authority could quite easily verify whether its provisions were being observed if the scales, rates and tariffs were communicated in confidence after they had been applied.

The defendant replies that the dispatch of thousands of contracts ex post facto would make control practically impossible. Moreover, it is especially necessary for verification that there is no discrimination to be based on the comments which third parties concerned must be given the opportunity to submit.

C. Infringement of the first, second and third paragraphs of Article 70 of the Treaty

On this point the interveners advance an argument which is peculiar to them. It is not possible to regard, the first and second paragraphs of Article 70 as being of general application, since it does not cover all modes of transport; in fact the prohibition which can be read into it refers only to ‘national discrimination’, as was stated by Mr Advocate-General Roemer in his opinion of 11 February 1960 in Joined Cases 27 to 29/58 (Compagnie des Hauts Fourneaux et Fonde-ries de Givors, Établissements Prenat, SA, Société d'Exploitation Minière des Pyrenees, Compagnie des Ateliers et Forges de la Loire v High Authority). Such discrimination can be conceived only in connexion with transport services operated by the States themselves, namely rail transport. This is why, in his commentary, Reuter states that the authors of the Treaty were referring to rail transport when they drafted Article 70.

The interveners maintain that the third paragraph of Article 70 should be applied on the basis of this interpretation. Careful reading of Article 10 of the Convention on the Transitional Provisions leads to the same conclusion: the States have obligations in transport matters only in so far as they have entered into an agreement with each other on the subject.

If the States are held to have obligations in transport matters, this can only be in relation to transport which they operate or own, namely, rail transport.

The letter sent on 10 December 1958 by the French Government to the High Authority contains some pertinent remarks on this subject and they should have been taken into account.

The defendant expresses surprise that such an argument should have been raised in view of the fact that the authors of the Treaty, among whom were the Netherlands Government, have never mentioned it.

No support for the restrictive interpretation of the interveners can be found in the wording of Article 70 which refers to ‘… tariff rules of every kind …’.

The interveners have, in addition, used the argument that, as a result of Decision No 18/59, road transport has been placed at a disadvantage compared with other methods of transport. Is the Treaty likely to have enshrined a system of ‘distortion of the conditions of competition’ between transport by rail and other methods of transport?

D. Infringement of the third paragraph of Article 70 of the Treaty

The applicant and the interveners contend that Decision No 18/59 infringes the third paragraph of Article 70 in two respects.
- The provision expressly offers a choice between two alternative obligations: publication or communication. These two words were interpreted in the judgments in Case 1/54 (Government of the French Republic v High Authority) and Case 2/54 (Government of the Italian Republic v High Authority).
  
  Under the contested decision a communication to the High Authority really constitutes a special form of publication since the High Authority makes available for those concerned the scales, rates and tariff rules brought to its knowledge: thus the freedom of choice has gone.
- The article infringed refers to ‘scales, rates and all other tariff rules of every kind applied …’. But Decision No 18/59 refers to ‘scales, rates and tariff rules which they have decided to apply’. Under the High Authority's system, communication precedes implementation, which is contrary to the express wording of the Treaty, which does not lay down any general obligation to fix rates.
In support of its contention, the applicant quotes a passage from the above-cited judgment in Case 1/54, in which the Court held that the publication to which reference is made in the second paragraph of Article 60 is designed to keep the public informed:
‘If publication was not intended to keep the general public informed, it is difficult to understand why the Treaty did not merely declare “that the scales must be communicated to the High Authority”.’
This is precisely the difference between Article 60 and Article 70 that the Netherlands Government has always believed to have been embodied in the third paragraph of Article 70.
The defendant points out that the option contained in the third paragraph of Article 70, namely the option of publication or communication, is embodied in the contested decision, in particular in Article 2 (a) thereof. This conclusively rules out any conflict with the third paragraph of Article 70.
Moreover, the words used in the third paragraph of Article 70 bear comparison with the similar wording of Article 60 (2) (a) of the Treaty (the price lists and conditions of sale applied by undertakings within the Common Market must be made public …) as it was interpreted in the judgment delivered by the Court in Case 1/54, cited above. This wording in no way prevents the charges from having to be made public before being applied in practice and the words ‘charges applied’ can be regarded as meaning the same words ‘charges to be applied’.
Finally, the interpretation offered by the other parties is incompatible with the Treaty, taken as a whole.
The interveners emphasize the importance of the second point and draw attention to the fundamental difference between publication of prices, as specified in the judgment quoted above, and publication of transport conditions. While Article 60 is peremptory and imposes a strict obligation on the seller, Article 70 does not impose any obligation on carriers and the High Authority gave itself legislative powers in the belief that ‘this is required by the objectives of the Common Market’. This is aggravated by the fact that the High Authority used these powers to oblige carriers to lay down fixed tariffs and not to conclude contracts the clauses of which can and usually do differ from each other. Such a requirement is contrary to the third paragraph of Article 70.
The defendant replies that the first paragraph of Article 70 recognizes the need to apply such rates and conditions as the High Authority requires. In the case of transport, the Treaty clearly provides for tariffs the contents of which (‘scales, rates and all other tariff rules’) must, in the words of the third paragraph of Article 70, be published or brought to the knowledge of the High Authority.
It draws attention to the adjective ‘fixed’ which keeps recurring in connexion with tariffs in the interveners' arguments and which the latter seem to use in the hope of giving the impression of a certain inflexibility if not of immutability. But, under the system adopted by the High Authority tariffs can vary with the greatest of ease. There is no question of their being ‘fixed’ as they may be, for example, in long-term contracts, secret or otherwise.

E. Infringement of the fifth paragraph of Article 70 of the Treaty

The applicant is of the opinion that the principle laid down in the fifth paragraph of Article 70, under which transport policy is left to the States, goes to show that in this field the Member States are subject only to obligations expressly provided for by the Treaty and not to obligations such as those specified and defined in the contested decision.

As far as the interveners are concerned, there is a further infringement of the fifth paragraph of Article 70 in that the High Authority applied the strict arrangements in Article 88 to the Governments only in the field of road transport, thus placing it in an unfavourable competitive position especially since, as was pointed out above under ‘C, infringement of the Treaty’, Article 70 makes rail transport its first target. Such a policy entails serious discrimination against road transport.

The defendant contends that, although under the fifth paragraph of Article 70 transport policy shall continue to be governed by the laws or regulations of the individual Member States, this is ‘subject to the provisions of this Article [namely Article 70] and to the other provisions of this Treaty’.

The defendant points out that the argument which the interveners base on the fifth paragraph of Article 70 of the Treaty is not conclusive. The most that can be read into this provision is that, if after action by the High Authority pursuant to Article 88 road transport were placed in a comparatively unfavourable position, it would be open to the States to adopt, in relation to other types of transport, appropriate measures to make good this disadvantage.

F. Infringement of the second paragraph of Article 47 of the Treaty

The applicant contents that the High Authority infringes the second paragraph of Article 47 in announcing, in the contested decision, that the information supplied to it will be made available to certain parties.

The defendant replies that tariffs cannot be by their very nature secret, in contrast to ‘information about undertakings, their business relations or their cost components’.

Moreover, by virtue of the last sentence of the second paragraph of Article 47, the High Authority is under a duty to publish any general information the knowledge of which could be useful ‘to any other parties concerned’. Thus, the provision in Article 47 covering professional secrecy does not apply to information the publication of which is necessary in order to achieve the aims of the Treaty.

G. Infringement of the fifth paragraph of Article 70, the first paragraph of Article 2, taken together with Article 26, the second paragraph of Article 2, taken together with Article 37, and Article 5 of the Treaty.

The applicant contends that the contested decision infringes the abovementioned articles because its implementation involves consequences detrimental to road-haulage undertakings and provokes fundamental and persistent disturbances in in the Netherlands economy.

In the case of road-haulage undertakings:
The applicant emphasizes that extensive publication of precise transport charges inevitably affects the competitiveness of transport undertakings. The obligation to publish tariffs makes it impossible to produce realistic and therefore sensible charges which take account of the conditions on the market and of the numerous factors which help to determine the cost price of each journey.
The system proposed by the High Authority tends more and more towards a levelling down of charges to the detriment of the undertakings' profitability.
Such a situation will inevitably result in intervention by the Governments and, in consequence, the fixing of compulsory tariffs. The result will be to freeze movement and road transport will suffer in consequence. All methods of transport alike would feel the effect of competition and the consequential repercussions of the fixing of tariffs by the State.
In the case of the Netherlands:
As a result of its geographical situation, the Netherlands has a special interest in transport and transit matters. As Decision No 18/59 is liable to produce the effects described above, the Netherlands Government is entitled to preserve a situation which is of particular advantage to it, in the belief that the free play of competition be tween profitable undertakings will ensure that the principle of non-discrimination in the transport field is observed.

The defendant claims that:

transport undertakings are capable of fixing their tariffs themselves without the slightest interference by the authorities;
tariffs can be drawn up in a detailed and realistic manner in order to allow for all special circumstances (railway tariffs are a typical example of detailed tariffs);
the fixing of tariffs is provided for in current Netherlands legislation;
other sections of industry and even certain transport systems, like the railways, apply common tariffs;
in the water-borne transport sector, the Netherlands Government has itself found it necessary to introduce arrangements for the publication of freight charges;
the other countries of the Community, with the exception, latterly, of Italy, already recognize and to some extent apply the High Authority's system which the Netherlands Government describes as disastrous;
the fixing of tariffs proposed by the Authority still allows for a margin of discretion (Articles 3 and 4 of the decision);
only coal and steel transport is involved;
a carrier who works out his own detailed and comprehensive tariff has plenty of room for manoeuvre and can, in addition, operate within a ‘margin’ of 10 %;
consumers can already, today, take advantage of the competition between carriers; their ability to do so represents a greater risk for carriers when the latter do not know their competitors' rates than when they do;
the system provided for by the decision will not result in ‘alterations of prices’ or ‘lack of flexibility’ of fixed rates laid down; on the contrary, it gives free play to competition, which is encouraged rather than weakened by the publication of prices;
there has been no evidence that the putting into effect of Decision No 18/59 radically changed the successful results obtained by the policy of the Netherlands Government in the transport field; publication of rates is always of value in the struggle against discrimination; nor must it be forgotten that there is no ideal system of free competition.

H. Infringement of Articles 3 and 5 of the Treaty

The interveners describe various peculiarities and characteristics of road transport and develop the following points:

the large number of carriers by road (60 000 from Italy and 9 000 from the Netherlands) makes it illusory to communicate rates which these carriers can change at any moment particularly since they are free to refuse to carry out deliveries at the rates and on the conditions announced;
in order to determine the ‘optimum outlet’, in other words to define his selling area, a producer must know his own costs as well as those of his competitors and knowledge of the cost means knowledge of the transport scales and rates according to destination, but it must be clearly understood that, in view of the number of competitors, those costs can only be known as a general figure, and in consequence, the perimeter of a selling area can be fixed only on the basis of ex transport costs;
the market in transport is always changing, especially as the result of seasonal variations, so charges vary considerably and it is of no value for producers to know the exact rates; if the producers' price lists were in part based on the exact charges for transport every alteration in the latter would entail an alteration in the price lists, but this is not what happens, which shows that only average transport charges are taken into account;
the publication of transport rates makes sense only if there is an obligation upon carriers by road not subject to regulations to transport goods at the rates which they have published; there is no such obligation, and this can cause some unpleasant surprises;
the alignment referred to in Article 60 (2) is feasible to such a small extent that it can help very little to stimulate competition; even if direct or indirect publication of transport rates were necessary to enable the right to alignment to be freely exercised, at all times and places, given the limited effect of this right, it still does not follow that such publication is indispensable for the proper functioning of the Common Market.
All this goes to show that the measures required by the High Authority are incomplete and unreasonable in so far as carriers by road are concerned; they open, indeed pave the way for, abuses, discrimination and all sorts of secret agreements between producers and carriers by road. It is impossible to exercise effective control. The contested decision does not, therefore, help to achieve the objectives pursued by the Treaty. In taking it, the High Authority acted contrary to the requirements of Title One of the Treaty, particularly Article 3 (b), (c) and (0 and the first paragraph and the third indent of paragraph (2) of Article 5.

The defendant replies that the system introduced by Decision No 18/59 accords with the Treaty and refers in general terms to the arguments developed above. Against the arguments developed by the interveners, it draws attention to the following considerations:

producers have a right to the alignment of prices and they should be guaranteed this right;
the interveners ignore the ability of carriers to draw up their tariffs in a way which takes account of conditions peculiar to each commitment; furthermore, they seem to have forgotten the existence of of the 10 % margin;
a general knowledge of transport conditions can to a certain extent enable prices to be aligned; nevertheless it is obvious that precise knowledge is preferable to such general knowledge; the power of alignment is of particular interest in cases where special rates are employed;
since there are about ten thousand carriers by road there could be no effective control if information concerning all contracts of carriage were the subject of separate communication; on the other hand, if tariffs are published, effective supervision can be exercised by those immediately concerned;
why should carriers not be willing to carry out transport commitments on the basis of a tariff which they fixed themselves and in which they must have made allowance for a reasonable margin of profit?

Finally, the defendant emphasizes that the carriers themselves advance the argument that dishonesty will undermine the system envisaged by the High Authority. In a community governed by the rule of law it must be a basic assumption that requirements of the law are fulfilled. The High Authority refuses to believe that if the measures are adopted the Netherlands Government will be unable to ensure that they are complied with.

IV — Procedure

The application was lodged in due form and time.

The procedure followed the normal course.

Grounds of judgment

I — Before proceeding with the matter consideration must be given to (1) the legal basis of the decision and (2) the procedure which led to its being taken.

(1) The legal basis of the decision appears from its title which states that it is ‘on the publication or notification to the High Authority of scales, rates and all other tariff rules of every kind applied to the carriage of coal and steel within the Community for hire or reward’ thus reproducing the wording of the third paragraph of Article 70 of the Treaty establishing the European Coal and Steel Community for which the intention is to lay down implementing rules.

The grounds likewise state that the objective of the decision is to implement that article.

(2) The decision takes the form of an application of the first paragraph of Article 88, and states that it is a reasoned decision by which the High Authority in accordance with this provision is empowered to record that a State has failed to fulfil an obligation under the Treaty.

II — Stripped, however, of ancillary submissions made variously by the parties, the central question raised by the action for annulment of Decision No 18/59 is: (A) with regard to substance, what are the legislative powers which the High Authority can claim on the basis of the third paragraph of Article 70 with regard to transport; (B) with regard to form, whether Article 88 chosen by the High Authority for the exercise of such powers may be legally used for such purposes, and (C) if appropriate, whether this article has been applied according to the rules laid down.

A. Although the Treaty establishing the European Coal and Steel Community contains rules capable, like rules laid down by the national legislature, of being directly implemented in the Member States, such implementation taking place ipso iure as a result of their acceptance into the law of the Member States by the ratification of the Treaty, other provisions of the Treaty on the other hand require implementing measures before they are applied.

This is the case with regard to the third paragraph of Article 70 of the Treaty which, although it establishes a concrete rule with regard to transport valid both for the Member States and for the High Authority, requires implementing measures for it to be applied to the subjects of the European Coal and Steel Community.

With regard to such implementing measures it is necessary to inquire whether the Treaty gives the High Authority power to make regulations either (1) expressly or (2) by implication.

1. The third paragraph of Article 70 provides that ‘The scales, rates and all other tariff rules of every kind applied to the carriage of coal and steel within each Member State and between Member States shall be published or brought to the knowledge of the High Authority’.

It must be observed that these provisions are silent with regard to the conditions of their application and the implementation measures which they assume and certainly they do not give the High Authority any power to take decisions in this respect.

Moreover, a comparison between the third paragraph of Article 70 and the provisions of Article 60 (2) (a) shows that in a similar matter the Treaty has made the obligations to publish provided for in Article 60 subject to the power of the High Authority to provide for its application by providing that this publication must take place ‘to the extent and in the manner prescribed by the High Authority after consulting the Consultative Committee’.

The fact that for the publication of the price-lists and conditions of sale applied within the Common Market the Treaty has expressly given the High Authority a legislative power, providing even for review by the Consultative Committee, shows the importance which it attributes in this matter to its regulation by the High Authority.

The absence of any provision in this respect in Article 70 shows on the other hand that in the transport sector the wording of the Treaty denies the High Authority any power to take implementing decisions.

2. Having regard to the different attitude adopted by the Treaty in respect of two similar situations it is proper to inquire whether a legislative power on the part of the High Authority does not arise by implication from (a) other provisions of the Treaty or (b) its general structure.

Writers and case-law agree in recognizing that the rules established by a treaty imply the principles without which these rules cannot effectively or reasonably be applied.

In the present case the High Authority maintains first that since the provisions of Article 60 (2) (a) require the publication of the price-lists and conditions of products coming within the European Coal and Steel Community, they require by implication the publication of the scales, rates and other tariff rules applied to the carriage of the same products.
According to the High Authority if the latter are not published the publication of the prices would lose their purpose and be of no use to those concerned.
In order for those concerned to be able to align their prices and maintain healthy competition they cannot remain ignorant of the important factor constituted by the transport rates in the formation of their quotations on the Common Market.
According to this argument, the corollary of the obligation to publish prices is the publication of transport tariffs and this obligation follows by implication from the concepts of 'price lists' and ‘conditions of sale’ referred to in Article 60.
It is wrong both in law and in fact to say that the expressions ‘price lists’ and ‘conditions of sale’ cover both those in respect of goods and those in respect of transport.
The seller can be required to publish only his own prices and not the rates applied by a transport undertaking.
In so far as the seller is required to pay the carrier's charges they represent an element of the seller's cost price.
The seller is not required to publish the details of his cost price.
The High Authority's argument that it is necessary to publish the transport rates in order to know the prices is contradicted by its own attitude with regard to Article 60 (2) (a).
If the view which it is now advocating were correct, that is to say, if the sale prices included transport rates, on laying down the rules for the scope and forms for the publication of the price-lists and conditions of sale it could have provided in the relevant decisions (No 3/53,30/53,31/53 and 1 to 3/54) for the transport costs as a price factor.
It did not, however, do so.
Although it is true that in the ‘Information’ which it sent out after certain of the abovementioned decisions on the publication of prices the High Authority refers to transport costs, it does so however only to align the steel prices on the delivery price of another undertaking and even in this case it takes into account the price actually paid which does not require any previous publication but is subject only to checking afterwards.
From another point of view it is not possible to infer a structural and functional correlation between the obligation to publish the prices of products and the obligation to publish transport costs from the basic principle of the Treaty which although guaranteeing economic freedom in the sphere of competition is nevertheless aimed at restraining abuse by prohibiting any discrimination, the checking of which is for the High Authority.
Although it is true that by virtue of the general principle, applied to transport by Article 70, checking discrimination and taking action against it is for the High Authority, it not however possible to infer from this principle a power for the High Authority to take decisions concerned with prior control by laying down the publication of scales or rates, since such a power is exceptional and subject to renunciation by the Member States which in the present case the Treaty does not provide for either expressly or by implication.
The High Authority thus has no power to implement the provisions of the third paragraph of Article 70 by means of decisions.

B. Although the third paragraph of Article 70 does not give the High Authority a power of decision to implement its provisions either expressly or by implication it is necessary to inquire whether Article 88 of the Treaty, to which it has recourse, could legally do so.

Article 14 of the Treaty provides ‘In order to carry out the tasks assigned to it the High Authority shall … take decisions, make recommendations …’.

The forms of exercise of its executive power are thus defined and circumscribed by this provision in that the exercise of the power to make regulations, where the High Authority has any such, is done by decisions which are ‘binding in their entirety’, but in cases where such a power to make regulations is not conferred upon it but is reserved to the Member States the High Authority, if it wishes to remind States of their duties, can only resort to a recommendation and cannot simply proceed to impose upon them its own choice with regard to methods.

Neither the wording nor the general structure of Article 88 allow the High Authority to rely on its provisions to exercise a power to make regulations similar to the general powers arising from the Treaty which have to be exercised in the forms provided by Article 14.

Article 88 gives the High Authority only a power to record that a State has failed to fulfil an obligation under the Treaty. This obligation must arise either from an imperative provision or a decision or recommendation prior to the application of this article.
The ‘reasoned decision’ referred to in the first paragraph of Article 88 may simply record a failure and may not have a legislative content. To maintain the contrary would amount to recognizing that the High Authority has an excessive legislative power as against Member States arising from the general law.
The reasons required by the first paragraph of Article 88 must justify the recording of the failure and the time-limit referred to therein defines the period in which a pre-existing obligation must be fulfilled and not one created by the decision taken under this article.
If it were possible to equate the ‘decision’ referred to in Article 88 with a decision within the meaning of Article 14 by which the High Authority carries out the tasks assigned to it, it would be difficult to explain why a rule laid down under Article 88 would be subject to an action in which the Court has unlimited jurisdiction allowing any submission to be made based not only on legality but on any reasons justifying failure to act, whereas decisions taken in the form provided for by Article 14 are subject to the rules and time-limits for bringing actions under Article 33.
Article 88 opens means of implementation and is the ultima ratio enabling the Community interests enshrined in the Treaty to prevail over the inertia and resistance of Member States.
It is a procedure far exceeding the rules heretofore recognized in classical international law to ensure that obligations of States are fulfilled.
However, Article 88 must be strictly interpreted.
Although with regard to decisions and recommendations of the High Authority the Governments must follow the means of redress laid down by the Treaty according to the forms and within the time-limits prescribed and cannot subsequently allege that these measures are irregular or null and void when the High Authority takes steps under Article 88, the High Authority for its part must adhere to the forms available to it under Article 14 of the Treaty in the exercise of its ‘legislative’ power.
It never has the choice between this ‘legislative’ power and the procedure for recording and declaring a failure for which Article 88 has been enacted.
In no way can it use this article for purposes the direct achievement of which by means of decision the Treaty denies it.
The High Authority cannot, moreover, claim that the contested decision only records a failure on the part of the Netherlands State under Article 88, since the obligations which the contested decision maintains have not been fulfilled are already specified in the letter of 12 August 1958 addressed to that State.
The title of the contested decision contradicts this assertion and clearly establishes that its objective is the issue of a regulation for which the third paragraph of Article 70 provides no basis.
A comparison between Article 1 and the following articles of the contested decision likewise show that the present case could not be only the recording of a failure to fulfil an obligation.
The contested decision could not regard the obligations formulated in the letter of 12 August 1958 as disregarded since they are not the same as those contained in the decision itself.
Thus the High Authority wrongly relied on Article 88 to lay down provisions for the implementation of the third paragraph of Article 70, thereby not only misconstruing Article 88 but also misusing the procedure provided for there as a means of implementation to accomplish a task of drawing up regulations which it did not have.

C. Although the wording of Article 70 and the wording and general structure of Article 88 give the High Authority no direct power to make regulations implementing the provisions of the third paragraph of Article 70, it is necessary to inquire whether the contested decision may, as the High Authority maintains, be regarded not as an independent regulation, but as a ‘reasoned decision’ recording a failure.

On this basis it was the letter of 12 August 1958 which required the Member States in general and the applicant in particular to submit their observations with regard to the obligation which the contested decision recorded as not being fulfilled.

Consideration of the letter sent on 12 August 1958 by the High Authority to the Netherlands Government shows that the High Authority is laying down requirements with regard to regulations which have to be adopted by the Governments in respect of road transport. These requirements were intended to be binding with regard to the objective which they lay down, namely the obligation arising, according to the High Authority, from the third paragraph of Article 70 to publish the scales, rates and all other tariff rules of every kind applied to road transport.

In the letter of 29 November 1958 the Netherlands Minister for Transport and Waterways described the measures which he considered to be appropriate for the attainment of the objectives referred to, namely to meet the requirements of Article 70 of the Treaty in respect of road transport.

These measures were, moreover, put into effect by Royal Decree of 24 December 1958.

Since the High Authority's letter of 12 August 1958 contained an admonitory reference to the first paragraph of Article 88 of the Treaty and the High Authority did not consider that the Royal Decree of 24 December 1958 satisfied the requirements of the third paragraph of Article 70 of the Treaty, it reacted to the observations made by the Netherlands Minister for Transport and Waterways by taking Decision No 18/59 of 18 February 1959‘on the publication or notification to the High Authority of the scales, rates and all other tariff rules of every kind applied to the carriage by road of coal and steel within the Community on behalf of third parties’ on the basis of the first paragraph of Article 88.

In the decision it records that all the Member States are failing to fulfil their obligations towards the Community by not unconditionally accepting one of the three ‘possibilities’ which it had allowed.

For the form of this recording to be valid the High Authority ought as a preliminary step to have given the Netherlands Government an opportunity to submit its ‘comments’ in accordance with the first paragraph of Article 88.
It considers that it has satisfied this condition by treating the letter of 29 November 1958 from the Netherlands Minister for Transport and Waterways as representing such ‘comments’ on the ground that the recommendation of 12 August 1958 contained a reference at the end to the second sentence of the first paragraph of Article 88 of the Treaty.
The Court cannot, however, regard this exchange of letters as constituting the final comments prior to the serious measure of recording a failure to fulfil agreed obligations on the part of a State, especially since the position adopted by the Netherlands Government was in furtherance of the objectives laid down in Article 70 referred to by the High Authority.
It not is sufficient that an imperative proposition contains a reference to the first paragraph of Article 88 for it to be said that any contrary opinion expressed by a Government which takes a view different from that of the High Authority on the proper means to attain the objectives which the latter is pursuing must be immediately regarded as constituting the comments referred to in the first paragraph of Article 88 and as exhausting that Government's arguments on the determination of the obligations which it has in fact or is alleged to have under the Treaty.
This applies particularly in the present case where fundamentally the High Authority could refer only to the objective assigned to the State and had to leave the choice of means to the discretion of the Netherlands Government.
It would indeed be inconceivable that the different attitude, which was, nevertheless, a very comprehensive one and was followed by the initiation of legislative action by the Netherlands Government in the form of the Royal Decree of 24 December 1958 relating to the ‘possibilities’ submitted by the High Authority could have been in the nature of comments on a precise failure, or one at least sufficiently specified in law. It is even less conceivable inasmuch as argument before the Court has disclosed that the parties share the same view.
Since the High Authority has not given the Netherlands Government an opportunity to submit its comments as required by Article 88, the applicant rightly argues that the decision is null and void as being defective in form in so far as it purports to record a failure by the Netherlands State to fulfil an obligation which it has under the Treaty establishing the European Coal and Steel Community.
The contested decision further infringes the Treaty by its erroneous application in law of Article 88.
The recording of the failure on the part of the applicant State to fulfil an obligation could relate only to its obligation to pursue the objective referred to in the third paragraph of Article 70.
The decision however infers the alleged failure from the finding that the measures taken by the Netherlands Government were not capable of achieving the objective of the third paragraph of Article 70 on the sole ground that they did not unconditionally adopt one of the three ‘possibilities’ regarded as alone being suitable by the High Authority.
In doing this the High Authority only recorded the failure to employ the means which it suggested whereas legally it should have recorded whether in the circumstances there was a failure to attain the proposed objective.
Thus it infringed both Article 88 and Article 70 of the Treaty.

III — In these circumstances and without its being necessary to consider the other arguments presented by the applicant and the interveners it is right to annul Decision No 18/59 of the High Authority.

IV — Under Article 69 (2) of the Rules of Procedures the High Authority must bear the costs.

On those grounds,

Upon reading the pleadings;

Upon hearing the report of the Judge-Rapporteur;

Upon hearing the parties;

Upon hearing the opinion of the Advocate-General;

Having regard to Articles 4, 14, 60, 70 and 88 of the Treaty establishing the European Coal and Steel Community;

Having regard to the Protocol on the Statute of the Court of Justice of the European Coal and Steel Community,

Having regard to the Rules of Procedure of the Court of Justice of the European Communities,

THE COURT

hereby:

Annuls Decision No 18/59 of the High Authority of 18 February 1959 published in the Journal Officiel of 7 March 1959 on the publication or notification to the High Authority of the scales, rates and all other tariff rules of every kind applied to the carriage by road of coal and steel within the Community for hire or reward.

Orders the High Authority of the European Coal and Steel Community to bear the costs.

Donner

Delvaux

Rossi

Riese

Hammes

Delivered in open court in Luxembourg on 15 July 1960.

A. Van Houtte

Registrar

A. M. Donner

President