Luxembourg, 09/10/2001 (Agence Europe) - The Court of First Instance (CFI) and its President, Bo Versterdorf, have examined the following cases. In the Mukand ruling and at the request of four Indian steel companies, the First Chamber of the Court of First Instance cancels the "taxes" (or countervailing duties) that the Indian exporters were to pay upon entry to the EU. Also, in a preliminary ruling, Bo Vesterdorf considers that Saxonia, the former subsidiary of the East German group Lintra, can now afford to pay back Commission aid deemed illegal. Furthermore, French companies assert that the European Commission is playing on words in the case on the TotalFina/Elf Aquitaine merger.
For the first time, Indian steel companies take EU Council to Court and win
Four Indian exporters of stainless steel bright bars (SSBB) - the companies Mukand, Isibars and Viraj Impoexpo located in Mumbai, and Ferro Alloys Corporation in Nagpur, whose exports to the EU were subject to countervailing duties - have gained annulment of these taxes. The Court cancelled the Council's ruling of 13 November 1998 establishing definitive countervailing duties on imports of steel bars from the above companies. The assessment of injury suffered by the Community industry is, according to he First Chamber of the CFI presided by Bo Vesterdorf, "vitiated by a manifest error".
In September 1997, the Eurofer association filed a complaint with the European Commission. It affirmed that the imports of stainless steel bright bars from India were subsidised and thus caused considerable injury to the Community industry. The Indian steel companies maintained that the Community steel companies had come to a concerted agreement - in breach of European law - to sell their steel bars at artificially high prices. The Indians had chosen a Greek lawyer, Konstantinos Adamantopoulos, from Athens, to defend their case. (Me Adamantopoulos was the lawyer for British Midland Airways in a State aid case before the EU Court of First Instance).
The Council stated that it did not dispute the fact that the Community industry calculated its prices by adding together a base price and an alloy surcharge, itself calculated according to a "yield factor". It did, however, admit that there was no evidence that the implementation and the application of this formula for calculating the alloy surcharge of SSBB was the result of concerted practice. This argument was rejected by the President of the Court: the Council and the Commission failed to take account of the "uniform, consistent industrial practice of Community producers of SSBBs and hot-rolled bars, the objective effect of which was automatically to mirror, in the markets for those products, the artificial price increases achieved through concertation by producers of flat products". The Community institutions failed to take "a known factor" into account, that could also be the cause of injury suffered by the Community industry. Under these circumstances, the assessment of such injury (and the causal link with imports from India) is, as the CFI explained, "vitiated by a manifest error". It should be noted that, in order to be able to establish anti-subsidy duties, the Community institutions must fulfil two conditions. They must prove the existence of injury for the Community industry and prove that exporters benefit from subsidies.
Saxonia, ex-subsidiary of the Lintra group, is now said to have powerful financial backing from its new buyer
The German company Saxonia is expected to pay back the amount it had received in aid when it was part of the East German group Lintra (see EUROPE of 30 March). Saxonia is to repay the State aid further to a decision by the Commission (see EUROPE of 30 March). Saxonia, however, challenges the decision before the Court of First Instance and calls on its president to suspend its effect - i.e. reimbursement of over DM 3 million. It argues that paying back such a large sum would place its survival in jeopardy. In a preliminary ruling, Bo Vesterdorf refuses to accept its demands. Saxonia, it states, was bought up on 13 June 1997 by Vereinigte Deutsche Nickel Werke, whose considerable financial weight would, at first sight, allow it to reimburse the part of aid at stake.
French companies ousted during TotalFina-Elf Aquitaine merger point finger at European Commission
The "Petrolessence" affair enters the oral phase of proceedings. The Court of First Instance is soon to set a date for a hearing. Petrolessence and the motorway catering management company, SG2R, were ousted from the list of bidders for motorway service stations.
The two companies jointly operate their activities under the trade name "Mirabellier". In August 2002, TotalFina had put them forward as possible buyers of 6 of the 70 petrol stations which the French oil firm had to rid itself of for the Commission to allow it to take over Elf Aquitaine (EUROPE of 9 November 2000). On 13 September 2000, the Commission rejected Mirabellier which, it said, was financially incapable of competing with other motorway petrol stations. The candidacy of the Italian firm Agip was also rejected. The latter immediately appealed to the Court for an annulment of the Commission's decision.
On 20 October, TotalFina submitted a new list of potential buyers (EUROPE of 9 November 2000) on which Mirabellier no longer appeared. The group Carrefour, absent from the first list, obtained 17 service-stations. Agip was again on the list. On 7 November 2000, the Commission accepted the new list and agreed (on 14 December, Agip informed the Court that the Commission had approved a second plan that gave it 21 service-stations, and that it had lost all interest in pursuing the court case. The case was dropped on 15 February 2001).
Petrolessence and SG2R dispute the Commission's refusal and to integrate them on a list of buyers. They have financial capabilities, they say, to take over the service-stations. They dispute their eviction, illegal they say, before the Court of First Instance. While awaiting the ruling as to the substance of the case, they are calling on the President of the Court, Bo Vesterdof to provisionally suspend the allocation of the six service-stations they intend obtaining.
In a preliminary ruling, Bo Vesterdorf refused. He explained that Petroessence and SG2R had not proven that they had suffered serious and irreparable financial injury. He then added, even if that had been the case, their interest had to pass behind the "public interest" which is to succeed in the TotalFina and Elf Aquitaine merger.
Petrolessence and SG2R consider that the disputes they have with the Commission to be limited and did not endanger the merger of the two oil groups.