Kingdom of the Netherlands v Commission of the European Communities: ECJ 8 Feb 1968

Europa 1. Transport – special internal rates and conditions – purpose of such special rates and conditions – authorization justified (ECSC treaty, article 70) 2. Transport – special internal rates and conditions – unforeseeable circumstances justifying authorization of special rates and conditions – modifications in the infrastructure of transport 3. ECSC treaty – general objectives – natural conditions of competition – concept (ECSC treaty, second paragraph of article 2) 4. ECSC treaty – general objectives – continuity of employment – preservation of balance between different general objectives (ECSC treaty, articles 2 and 3) 5. Transport – special interest rates and conditions – application to a group of undertakings – authorization permissible (ECSC treaty, article 70) 6. Transport – special internal rates and conditions – restrictive clause – authorization exceptional nature – temporary authorization – fixing of time-limit (ECSC treaty, article 70). 1. The purpose of the authorization of special rates and conditions is to grant temporary aid to enable undertakings to overcome – in particular by means of a re-adaptation of production and distribution – exceptional difficulties resulting from unforeseeable circumstances which are likely to result in a situation in which the composition of production costs no longer corresponds to the natural conditions of competition existing between them. Cf. Paragraph 2, summary, judgment in joined cases 27, 28 and 29/58, (1960) ecr 505. 2. The unforeseeable nature of the circumstances justifying the grant of special rates and conditions must be assessed in the light of the facts of each case and according to a reasonable assessment of the situation. In the transport sector, modifications in the infrastructure, execution of which brings about a change in the existing economic situation, constitute such unforeseeable circumstances. 3. The concept set out in the second paragraph of article 2 of the treaty concerning conditions which will of themselves ensure the most rational distribution of production cannot be regarded as a fixed concept, but covers facts which are themselves contingent and variable, in particular with regard to time. 4. Although it is true that the establishment of the common market is based in particular on the most rational distribution of production at the highest possible level of productivity, it in no way follows that the social objectives set out in article 2 of the treaty are always of secondary importance and can in no case constitute one of the decisive grounds for community action. As the general objectives set out in articles 2 and 3 of the ECSC treaty cannot always be pursued simultaneously in their totality, the community must continually reconcile any possible conflict which may be implied by these objectives when considered individually, and when such conflict arises must grant such priority to one or other of the general objectives as appears necessary having regard to the economic facts or circumstances in the light of which it adopts its decisions. Cf. Paragraph 4(b), summary, judgment in case 8/57, (1958) ecr 245. 5. The application of special rates and conditions in the interest of one or more undertakings does not necessarily imply individual measures and in no way excludes the introduction of measures adapted to a group of undertakings which are similarly placed. 6. As the application of special rates and conditions constitutes an altogether exceptional procedure, the treaty only allows it to the extent to which it enables the undertakings in whose favour it operates to re-establish, within the appropriate time – limits, conditions which will of themselves ensure the most rational distribution of production at the highest possible level of productivity. In order to ensure observance of the objectives of the treaty, a time-limit must be attached to the temporary agreement given by the high authority to the application of the special rates and conditions. Cf. Paragraph 2, summary, judgment in joined cases 27, 28 and 29/58, (1960) ecr 241.

Citations:

C-28/66, [1968] EUECJ C-28/66

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Updated: 20 May 2022; Ref: scu.131828