Another judgment of the Court of Justice on Article 263 (4) TFEU and what is a “regulatory act not entailing implementing measures”. And again, the Court held on 28 April 2015 in Case C-456/13 P T & L Sugars v Commission that the measure challenged was not “regulatory act not entailing implementing measures”. Does that judgment end the hopes of those who wished for a broader interpretation of Article 263 (4) TFEU and for a loosening of the rules on standing ?

After all, AG Cruz Villalòn was sympathetic to the idea in his Opinion of 14 October 2014 that the measures challenged were indeed  “regulatory acts not entailing implementing measures” and advised that the action should be declared admissible.

The Court, in its judgment of 28 April 2015 disagreed and relied on its judgment in Telefonica v Commission C-274/12 P, EU:C:2013:852 (which we noted up in our very first post).

Let’s look at the facts.

The applicants, T&L Sugars Ltd and others, are EU cane sugar refiners. Their combined production capacity accounts for around half the traditional supply needs of the EU  cane sugar refining industry. The supply of sugar on the EU market includes sugar produced, first, by the processing of sugar beet grown within the European Union and, second, by the refining of raw cane sugar imported from non-member countries, the final product being chemically identical in each case. Raw cane sugar grown in the EU, namely in the French Overseas Departments and in the Azores, represents less than 2% of EU sugar production.

Between 3 March and 19 April 2011, the Commission adopted certain measures designed to increase the supply of sugar on the EU market, which was experiencing a shortage.The purpose of those measures was, firstly, to permit EU producers to market a limited quantity of sugar and isoglucose in excess of the domestic production quota and, secondly, to introduce a tariff quota allowing any economic operator concerned to import a limited quantity of sugar with import duties suspended. The Commission adopted four regulations to that effect.

The Applicants brought an action in the General Court to have those four regulations annulled.

Judgment of the General Court

The General Court dismissed the action in its judgment of 6 June 2013 T & L Sugars and others v Commission, T-279/11, EU:T:2013:299. It held that:

• the contested regulations were not regulatory acts not entailing implementing measures because they did entail measures to be taken by national authorities that could be challenged in the national legal order
• the applicants were not individually concerned by the contested measures.

The applicants then appealed the judgment of the General Court to the Court of Justice.

The AG’s Opinion

As said above, AG Cruz Villalon opined that the contested measures were regulatory acts not entailing implementing measures within the meaning of Article 263 (4) TFEU and considered that the action for annulment should be declared admissible.

The Court of Justice’s judgment

The Court disagreed with the Advocate General, dismissed the appeal and upheld the judgment of the General Court. The Court held that the measures challenged were not regulatory acts not entailing implementing measures and that the applicants were not individually concerned by them.

The Court began with some introductory findings. It recalled that the concept of ‘regulatory act which … does not entail implementing measures’ within the meaning of the final limb of Article 263 (4) TFEU must be interpreted in the light of the objective of that provision, which is, as is apparent from its drafting history, to ensure that individuals do not have to break the law in order to have access to a court. Where a regulatory act directly affects the legal situation of a natural or legal person without requiring implementing measures, that person could be denied effective judicial protection if he did not have a direct legal remedy before the EU judicature for the purpose of challenging the legality of the regulatory act. In the absence of implementing measures, natural or legal persons, although directly concerned by the act in question, would be able to obtain a judicial review of that act only after having infringed its provisions, by pleading that those provisions are unlawful in proceedings initiated against them before the national courts (judgment in Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 27).

However, where a regulatory act entails implementing measures, judicial review of compliance with the EU legal order is ensured irrespective of whether those measures were adopted by the EU or the Member States. Natural or legal persons who are unable, because of the conditions governing admissibility laid down in the fourth paragraph of Article 263 TFEU, to challenge an EU regulatory act directly before the EU judicature are protected against the application to them of such an act by the ability to challenge the implementing measures which the act entails (judgment in Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 28).

Where responsibility for the implementation of such acts lies with the institutions, bodies, offices or agencies of the European Union, natural or legal persons are entitled to bring a direct action before the EU judicature against the implementing acts pursuant to Article 263 (4) TFEU, and to plead in support of that action, pursuant to Article 277 TFEU, the illegality of the basic act at issue. Where that implementation is a matter for the Member States, those persons may plead the invalidity of the basic act at issue before the national courts and tribunals and cause the latter to request a preliminary ruling from the Court of Justice, pursuant to Article 267 TFEU (judgments in Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 93 (which we note up here and here) and Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 29).

The Court recalled that whether a regulatory act entails implementing measures should be assessed by reference to the position of the person pleading the right to bring proceedings under the final limb of Article 263 (4) TFEU. It is therefore irrelevant whether the act in question entails implementing measures with regard to other persons (judgment in Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 30, and Stichting Woonpunt and Others v Commission, C‑132/12 P, EU:C:2014:100, paragraph 50, which we posted about here).

In the present case, the Court found that the General Court had made an error in law because  the General Court did not examine whether the regulations challenged were of direct concern to the appellants: it based its finding that the action was inadmissible on the fact that those regulations entailed implementing measures within the meaning of the final limb of the fourth paragraph of Article 263 TFEU.

However, the Court went on to find that certain of the challenged regulations are not of direct concern to the appellants within the meaning of the final limb of Article 263 (4) TFEU. Thus, the error of law made by the General Court is not such as to entail the setting aside of the judgment under appeal as regards the inadmissibility of the action against those regulations.

The Court also found that the remaining regulations challenged produce their legal effects vis-à-vis the appellants only through the intermediary of acts taken by the national authorities following the submission of applications for certificates. The decisions of the national authorities granting such certificates and the decisions refusing such certificates in full or in part therefore constitute implementing measures within the meaning of the final limb of Article 263 (4) TFEU.

The Court pointed out that that conclusion is not called into question by the allegedly mechanical nature of the measures taken at national level.

The Court then placed heavy emphasis on the fact that its finding was compatible with Article 47 of the Charter. According to settled case-law that article is not intended to change the system of judicial review laid down by the Treaties, and particularly the rules relating to the admissibility of direct actions brought before the EU Courts, as is apparent also from the Explanation on Article 47 of the Charter, which must, in accordance with the third subparagraph of Article 6(1) TEU and Article 52(7) of the Charter, be taken into consideration for the interpretation of the Charter (see judgments in Sky Österreich, C‑283/11, EU:C:2013:28, paragraph 42; Alemo-Herron and Others, C‑426/11, EU:C:2013:521, paragraph 32; and Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 97).

Thus, the conditions of admissibility laid down in Article 263 (4) TFEU must be interpreted in the light of the fundamental right to effective judicial protection, but such an interpretation cannot have the effect of setting aside those conditions, which are expressly laid down in that Treaty (see, to that effect, Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 98 and the case-law cited).

However, judicial review of compliance with the EU legal order is ensured, as can be seen from Article 19(1) TEU, not only by the Court of Justice but also by the courts and tribunals of the Member States. The FEU Treaty has, by Articles 263 TFEU and 277 TFEU, on the one hand, and Article 267 TFEU, on the other, established a complete system of legal remedies and procedures designed to ensure judicial review of the legality of acts of the institutions, and has entrusted such review to the EU judicature (judgments in Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraphs 90 and 92, and Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 57).

In proceedings before the national courts, individual parties have the right to challenge before the courts the legality of any decision or other national measure relative to the application to them of a EU act of general application, by pleading the invalidity of such an act (see, to that effect, judgments in E and F, C‑550/09, EU:C:2010:382, paragraph 45, and Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 94).

It follows that references on validity constitute, like actions for annulment, means for reviewing the legality of EU acts (judgments in Zuckerfabrik Süderdithmarschen and Zuckerfabrik Soest, C‑143/88 and C‑92/89, EU:C:1991:65, paragraph 18; ABNA and Others, C‑453/03, C‑11/04, C‑12/04 and C‑194/04, EU:C:2005:741, paragraph 103; and Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 95).

In that regard, it must be borne in mind that where a national court or tribunal considers that one or more arguments for invalidity of an EU act, put forward by the parties or, as the case may be, raised by it of its own motion, are well founded, it is incumbent upon it to stay proceedings and to make a reference to the Court for a preliminary ruling on the act’s validity, the Court alone having jurisdiction to declare an EU act invalid (judgments in IATA and ELFAA, C‑344/04, EU:C:2006:10, paragraphs 27 and 30 and the case law cited, and Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 96).

As regards persons who do not fulfil the requirements of Article 263 (4) TFEU for bringing an action before the EU Courts, it is for the Member States to establish a system of legal remedies and procedures which ensure respect for the fundamental right to effective judicial protection (Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 100 and the case-law cited).

That obligation on the Member States was reaffirmed by the second subparagraph of Article 19(1) TEU, which states that Member States ‘shall provide remedies sufficient to ensure effective judicial protection in the fields covered by EU law’ (see judgment in Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 101). That obligation also follows from Article 47 of the Charter as regards measures taken by the Member States to implement Union law within the meaning of Article 51(1) of the Charter.

Accordingly, the Court held that the appeal should be rejected.

The Court went on to consider a second ground of appeal: whether the contested regulations were of individual concern. It did so because pursuant to Article 263 (4) TFEU, natural or legal persons may institute proceedings against an act which is not addressed to them and entails implementing measures only if that act is of direct and individual concern to them.

It held that they were not and rejected that ground of appeal also.

The Court recalled that it is settled case-law that persons other than those to whom a decision is addressed may claim to be individually concerned only if that decision affects them by reason of certain attributes which are peculiar to them or by reason of circumstances in which they are differentiated from all other persons and by virtue of these factors distinguishes them individually just as in the case of the person addressed (judgments in Plaumann v Commission, 25/62, EU:C:1963:17, 223; Inuit Tapiriit Kanatami and Others v Parliament and Council, C‑583/11 P, EU:C:2013:625, paragraph 72; and Telefónica v Commission, C‑274/12 P, EU:C:2013:852, point 46).

Also, the possibility of determining more or less precisely the number, or even the identity, of the persons to whom a measure applies by no means implies that it must be regarded as being of individual concern to them as long as that measure is applied by virtue of an objective legal or factual situation defined by it (see, to this effect, judgments in Antillean Rice Mills v Council C‑451/98, EU:C:2001:622, paragraph 52, and Telefónica v Commission, C‑274/12 P, EU:C:2013:852, paragraph 47).

It then found that the regulations challenged did not individually distinguish the applicants. Consequently, the General Court was right to hold, in the judgment under appeal, that the applicants were not individually concerned within the meaning of Article 263 (4) TFEU.