European Court of Justice rules that, in making side arrangements with United States on air fares and computerized reservation systems, Netherlands acted in area of external relations reserved to EU itself
In 1957, the Netherlands entered into an Air Transport Agreement (ATA) with the United States dealing, inter alia, with air fares and rates and Computerized Reservation Systems (CRSs). A protocol of March 31, 1978 and an exchange of notes on October 13 and December 22, 1987, an exchange of notes of January 29 and March 13, 1992 and an exchange of notes of October 14, 1992 either added to, or amended, the ATA.
In 2004, the EC Commission brought the present action; it asked for a declaration that, by contracting or maintaining in force [the ATA], despite the renegotiation of international commitments towards the United States, the Netherlands had failed to fulfil its obligations under Art. 5EC (now Art. 10 ) and Art.52EC (now, after amendment, Art. 43) and Regulations
2409/92 and 2299/89, as amended by Regulation 3089/93.
In its defense, the Netherlands argued inter alia that, pre dating January 1, 1958, Art. 307(1)EC covered the 1957 ATA. It provided that the EC Treaty did not affect rights and obligations arising from agreements between Member States and third countries entered into before January 1, 1958 or, for acceding States, before the date of their accession. It argued that the same principle applied to later secondary legislation; that is, that the mere existence of that legislation did not have the effect of requiring a Member State to terminate commitments towards non Member States.
The ECJ then addressed the admissibility of the Commission's action. In the first place, under some circumstances, the inordinate length of the pre litigation procedure laid down in Art.226 EC could make it too hard for the Member State in question to rebut the Commission's arguments, thus impairing the rights of the defense. Here, however, the Netherlands Government has not convinced us that the unusual duration of the procedure had had any effect on the manner in which it had organized its defense. Secondly, the procedure to secure a declaration of a Member State's failure to carry out its legal obligations rested on the objective finding that a Member State had failed to fulfil its duties under Community law. Moreover, a Member State could not cite the principle of "protection of legitimate expectations" in a case such as this, to bar an objective finding of its failure to carry out its EC Treaty obligations or duties imposed by secondary legislation. To admit that justification would conflict with the goal pursued by the Art. 226EC procedure.
Third, the Court is to apply the provisions of Art. 226EC without requiring that the Commission comply with a fixed time limit. In any event, the Commission did not abuse the discretion granted to it under Art. 226EC in a manner contrary to the Treaty.
Finally, the Court has to decide whether a Member State had failed to fulfil its obligations by reference to the situation existing in the Member State at the end of the period laid down in the reasoned opinion. The Court could not take into account any later changes.
The amendments made in October 1992 to the 1957 Agreement created new and substantial international commitments for the Netherlands. Those amendments indicated a renegotiation of the whole 1957 Agreement. In such a case, this prevented the other Member States not only from entering into new international commitments but also from keeping such commitments in force if
they violated Community law. Furthermore, the amendments made in October 1992 to the 1957 Agreement as a whole affected the scope of certain provisions which the parties either did not formally amend, or did so only in a limited way.
As a result, the present Court has to assess all the international commitments challenged in this action in relation to the provisions of Community law cited by the Commission in support of this action. It follows from that analysis that the argument of the Netherlands Government based on Art. 307(1)EC was groundless. Since Regulation 2409/92 went into effect, the Netherlands had no longer been entitled, despite the renegotiation of the 1957 Agreement, to enter on its own into, or to maintain in force, international commitments as to the fares and rates the carriers of non Member States could collect on intra Community routes. A commitment of that type arose from Art. 11 of the 1957 Agreement, as amended by the Exchange of Notes of January 29 and March 13, 1992 and by Art.6 of the 1978 Protocol.
The Netherlands had kept up that commitment despite the renegotiation of the 1957 Agreement which led to the Exchange of Notes of October 1992. By taking that course of action, the Netherlands had invaded the Community's exclusive international competence set forth in Art. 1(3) of Regulation 2409/92. Regulation 2299/89 gave the Community the sole competence to enter into agreements with non Member States with respect to the obligations relating
to CRSs offered for use, or used on, its territory. By the Exchange of Notes of January 29 and March 13, 1992, the Netherlands and the United States added to the 1957 Agreement an annex dealing with the principles pertaining to CRSs including those applying to CRSs offered for use, or used on, Netherlands territory. The Netherlands retained that Annex in force despite the renegotiation of the 1957 Agreement which leto the Exchange of Notes of October 1992. In so doing, that Member State infringed the exclusive external competence of the Community arising from Regulation 2299/89.
In addition, Art. 5EC (now Art. 10) required Member States to promote the achievement of the Community's tasks and to avoid taking any measure which could threaten the realization of the EC Treaty's goals. In the area of foreign relations, letting Member States enter into international commitments capable of affecting rules adopted by the Community or of altering their scope would compromise the Community's tasks and objectives under the EC Treaty.
Even if the Exchange of Notes of October 1992, did not formally make make large changes in Art. 4 of the 1957 Agreement, the Exchange did profoundly alter its content and scope. It followed (1) that we have to evaluate that Article under the provisions of Community law which the parties had invoked, (2) that the Netherlands Government's reliance on Art. 307(1) EC lacked merit.
Article 52 (now Art. 43) EC applies in the air transport sector; in particular it applies to airlines established in a Member State that offer air transport services between a Member State and a non Member State.
Article 4 of the 1957 Agreement did not square with Art. 52EC (Art. 43). Article 4 could always bar other Community airlines from the benefit of the 1957 Agreement, while according that benefit to Netherlands airlines. As a result, Community airlines suffered discrimination that prevented them from advantaging from the treatment which the Netherlands granted to its own nationals.
"In those circumstances, it is apparent that the [Commission's] claim that the Netherlands has failed to fulfil its obligations under [former] Art. 52 of the Treaty is well founded. Having regard to the whole of those considerations, the Court must conclude that, by contracting or maintaining in force, despite the renegotiation of the 1957 Agreement, international commitments towards the United States: [a] concerning air fares and rates charged by carriers designated by the United States on intra Community routes; [b] concerning CRSs used or offered for use on Netherlands territory; and [c] recognising the United States as having the right to withdraw, suspend or limit traffic rights in cases where air carriers designated by the Netherlands are not owned by the latter or by Netherlands nationals, the Netherlands has failed to fulfil its obligations under Arts 5 and 52 of the Treaty, and under Regulations 2409/92 and 2299/89." [ΒΆΒΆ 91 92]
Citation: Re Dutch Air Transport Agreement: Commission of European Communities v. Netherlands (Case C 523/04) (Eur. Ct. Just., [Gr. Ch.], April 24, 2007).
USA visa and immigration information is available at www.immigrationtelevision.com.
|
