Case T-644/14
ADR Center SpA
v
European Commission
(Financial aid — General Programme ‘Fundamental Rights and Justice’ for the period 2007-2013 — Specific Programme ‘Civil Justice’ — Action for annulment — Enforceable decision — Article 299 TFEU — Powers of the author of the act — Principle of sound administration — Application for an order directing the Commission to pay the balance due under the grant agreements — Partial reclassification of the action — Arbitration clause — Jurisdiction of the General Court — Eligible costs)
Summary – Judgment of the General Court (First Chamber, Extended Composition), 20 July 2017
Actions for annulment — Jurisdiction of the EU judicature — Claim seeking that directions be issued to an institution — Inadmissibility
Judicial proceedings — General Court seised under an arbitration clause — Subsidy agreements concluded in the context of a specific programme in the area of fundamental rights and justice — Decision constituting writ of execution — Action seeking annulment of that decision and obtaining from the Commission the payment of the balance due under the grant agreements — Partial reclassification of the annulment action as an action concerning a contractual dispute — Conditions
(Arts 263 TFEU and 272 TFEU; Rules of Procedure of the General Court (1991), Art. 44(1)(c))
Judicial proceedings — Application initiating proceedings — Formal requirements — Identification of the subject-matter of the dispute — Brief summary of the pleas in law on which the application is based — Action seeking compensation for loss caused by an EU institution — No indications as to the character and extent of the damage suffered or as to the causal link — Inadmissibility
(Statute of the Court of Justice, Arts 21 and 53, first para.; Rules of Procedure of the General Court (1991), Art. 44(1)(c))
Actions for annulment — Action against a decision forming a writ of execution — Decision open to challenge on the basis of Article 263 TFEU — Admissibility — Pleas relating to contractual stipulations and the applicable national law — Inadmissibility
(Arts 263 TFEU, 272 TFEU and 299 TFEU)
EU budget — EU financial assistance — Obligation on the beneficiary to comply with the conditions for grant of the assistance — Financing covering only expenses actually incurred — Demonstration that the expenses actually incurred — Burden of proof
(Art. 317 TFEU)
Commission — Powers — Implementation of the EU budget — Debts to the EU arising from a contract made by an institution — Recovery by an enforceable decision — Lawfulness — Infringement of the right to an effective remedy — None
(Arts 263 TFEU, 272 TFEU and 299 TFEU; Charter of Fundamental Rights of the European Union, Art. 47 ; European Parliament and Council Regulation No 966/2012, Art. 79(2))
Actions for annulment — Actionable measures — Concept — Measures producing binding legal effects — Debit note of an institution noting an existing debt and without executory force — Not included — Enforceable decision for recovery of a debt — Included
(Arts 263 TFEU, 272 TFEU and 299 TFEU; European Parliament and Council Regulation No 966/2012, Art. 79(2))
EU law — Principles — Right to effective judicial protection — Scope
(Charter of Fundamental Rights of the European Union, Art. 47)
See the text of the decision.
(see para. 56)
See the text of the decision.
(see paras 59-62)
See the text of the decision.
(see paras 65, 66)
See the text of the decision.
(see paras 70, 71)
See the text of the decision.
(see paras 93, 96, 103, 106)
Both Article 299 TFEU and Article 79 (2) of Regulation No 966/2012 on the financial rules applicable to the general budget of the Union confer power on the Commission to adopt an enforceable decision for recovery of a debt notwithstanding the fact that the amount concerned by that decision is associated with the implementation of the grant agreements and is therefore ‘contractual’ in nature. Neither Article 299 TFEU nor Article 79(2) of that regulation make a distinction according to whether the amount whose establishment is formalised by an enforceable decision is contractual or non-contractual in origin.
Furthermore, according the Commission, the power to adopt unilateral measures for the recovery of a contractual debt does not infringe Article 47 of the Charter of Fundamental Rights of the European Union in so far as the co-contractor concerned has an effective remedy against that unilateral measure. In fact, that co-contractor has the possibility, provided that the contract in question contains an arbitration clause within the meaning of Article 272 TFEU, of bringing an action before the EU Court with both Article 263 TFEU and Article [272](https://case-trace.com/x/eurlex/12016E/TXT#article-272) TFEU as its legal basis. In that action, that co-contractor may not only challenge the legality of the Commission’s decision, relying on pleas based on the Treaty or on any rule of law relating to its application, but also raise pleas and arguments based on the contract or on the law applicable to it and request the EU Court to rule on the merits of the contractual dispute between it and the Commission by exercising, in that respect, its unlimited jurisdiction under Article 272 TFEU.
(see paras 197, 198, 209, 213)
Unlike a debit note issued by the Commission, which, in a contractual relationship, constitutes a measure not open to an action for annulment, an enforceable decision for recovery of a contractual debt indisputably constitutes such a measure in so far as it aims to produce binding legal effects falling outside of the contractual relationship between the parties and which involve the exercise of the prerogatives of a public authority conferred on the Commission acting in its capacity as an administrative authority. In fact, the legal nature of an enforceable decision is defined not by grant agreements concluded by the Commission or the law applicable to them, but by Article 299 TFEU and Article 79 (2) of Regulation No 966/2012 on the financial rules applicable to the general budget of the Union.
In that regard, to the extent that an enforceable decision for the recovery of a debt constitutes a measure open to an action for annulment, the risk of unlawful extension of the jurisdiction of the court acting as arbiter of legality, does not arise in the present case, since, in any event, the court having jurisdiction over the contract, namely, the EU court before which an action has been brought on the basis of Article 272 TFEU, has no jurisdiction to review the legality of such a measure.
(see paras 207, 208)
See the text of the decision.
(see paras 210, 211)