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98 EN Official Journal of the European Communities C 278/11

ORDER OF THE COURT Action brought on 7 May 1998 by the Commission of the
European Communities against the French Republic
of 7 July 1998
(Case C-169/98)
in Joined Cases C-405/96 to C-408/96 (reference for a
preliminary ruling from the Tribunal d'Instance de Saint- (98/C 278/20)
Denis de la ReÂunion): SocieÂte Beton Express and Others v.
Direction ReÂgionale de la ReÂunion (1)

(Article 104(3) of the Rules of Procedure Ð Manifestly An action against the French Republic was brought before
identical question) the Court of Justice of the European Communities on
7 May 1998 by the Commission of the European
(98/C 278/19) Communities, represented by Peter Hillenkamp, Legal
Adviser, and HeÂleÁne Michard, of its Legal Service, acting
as Agents, with an address for service in Luxembourg at
the office of Carlos Gómez de la Cruz, Wagner Centre,
(Language of the case: French) Kirchberg.

The Commission of the European Communities claims
(Provisional translation; the definitive translation will be that the Court should:
published in the European Court Reports)

Ð declare that, in applying the general social
contribution (GSC) to the income from employment or
In Joined Cases C-405/96 to C-408/96: reference to the
income substitution benefit of workers who are
Court under Article 177 of the EC Treaty from the
resident in France but who, by virtue of Regulation
Tribunal d'Instance de Saint-Denis de la ReÂunion (France)
(EEC) No 1408/71 (1), are not subject to French social
for a preliminary ruling in the proceedings pending before
security legislation, France has failed to fulfil its
that court between SocieÂte Beton Express (Case C-405/
obligations under Articles 48 to 52 of the EC Treaty
96), SocieÂte Nouvelle de Concassage (Case C-406/96),
and Article 13 of that Regulation,
SocieÂte Bourbon LumieÁre (Case C-407/96) and SocieÂteÂ
Ouest Concassage (Case 408/96) and Direction ReÂgionale
des Douanes de la ReÂunion Ð Intervener: ReÂgion ReÂu-
nion, on the interpretation of Articles 9, 12 and 95 of the Ð order the French Republic to pay the costs.
EC Treaty Ð the Court, composed of: G. C. Rodríguez
Iglesias, President, C. Gulmann, H. Ragnemalm, M.
Wathelet and R. Schintgen, Presidents of Chambers, G. F.
Mancini, J. C. Moitinho de Almeida, P. J. G. Kapteyn, J. L. Pleas in law and main arguments adduced in support:
Murray, D. A. O. Edward (Rapporteur), J.-P. Puissochet,
G. Hirsch, P. Jann, L. Sevón and K. M. Ioannou, Judges;
A. Saggio, Advocate-General; R. Grass, Registrar, made an According to the Commission, the levying of the general
order on 7 July 1998, the operative part of which is as social contribution (hereinafter the GSC') on employees'
follows: income from employment or income substitution benefit
derived from professional activity in another Member
State constitutes a twofold social levy contrary both to the
provisions of Regulation (EEC) No 1408/71, and
Council Decision 89/688/EEC of 22 December 1989 Article 13 thereof in particular, and to Articles 48 to 52 of
concerning the dock dues in the French overseas the Treaty concerning freedom of movement for workers
departments must be interpreted as meaning that it within the Community.
precludes exemptions which are of a general or systematic
nature and which are therefore liable to lead to the
reintroduction of a tax having an effect equivalent to a
customs duty. On the other hand, Decision 89/688/EEC The Commission points out that, according to the
authorises exemptions which are necessary, proportional consistent case-law of the Court of Justice, the designation
and precisely determined and which fulfil the strict of a tax, charge, levy, contribution or fee must be
conditions laid down by Article 2(3) of that Decision, as examined in the light of the objective characteristics of the
interpreted in the light of the limits provided for in levy concerned, irrespective of the designation given to it
Article 226 of the EC Treaty. by the Member State in question.

(1) OJ C 54, 22.2.1997.
In this case, account should be taken, first, of the purpose
and use made of the levy and, second, of the arrangements
for the collection and charging of the contribution in
C 278/12 EN Official Journal of the European Communities 5.9.98

It is clear from the French legislation that the GSC is Appeal brought on 5 June 1998 by Salzgitter AG
intended to contribute to the financing of all the branches (formerly Preussag Stahl AG) against the judgment
of the general social security scheme in France. Article 4 delivered on 31 March 1998 by the Third Chamber,
of Regulation (EEC) No 1408/71 covers all the legislation Extended Composition, of the Court of First Instance of
relating to the branches of social security listed in the European Communities in Case T-129/96 between
paragraph 1. The purpose and use made of the GSC thus Preussag Stahl AG, supported by the Federal Republic of
lead the Commission to take the view that it constitutes a Germany, and the Commission of the European
social security contribution which comes within the scope Communities
of that Regulation. (Case C-210/98 P)
(98/C 278/21)

The Commission considers that levying the GSC on
income from employment and income substitution benefit
An appeal against the judgment delivered on 31 March
in the case of persons residing in France but working in
1998 by the Third Chamber, Extended Composition, of
another Member State undermines the principle that a
the Court of First Instance of the European Communities
single legislation is applicable, in that the GSC, which is
in Case T-129/96 between Preussag Stahl AG, supported
intended to finance social security schemes, is levied on
by the Federal Republic of Germany, and the Commission
incomes after deduction of all the social contributions due
of the European Communities was brought before the
in the State of employment, the only State which is
Court of Justice of the European Communities on 5 June
competent in matters of social security for employed
1998 by Salzgitter AG (formerly Preussag Stahl AG),
persons under Regulation (EEC) No 1408/71.
represented by Jochim Sedemund, Rechtsanwalt, of Messrs
Deringer, Tessin, Herrmann & Sedemund, Berlin, with an
address for service in Luxembourg at the Chambers of
Finally, the Commission lays emphasis on the importance Aloyse May, 31 Grand-Rue, L-1671 Luxembourg.
and urgency of deciding, as a matter of principle, whether
it is compatible with Regulation (EEC) No 1408/71 to levy
The appellant claims that the Court should:
the GSC on employment income or income substitution
benefit derived from employment undertaken in another
Member State by persons resident in France for tax Ð set aside the judgment delivered on 31 March 1998
purposes, where social contributions have already been by the Court of First Instance of the European
deducted from that income. Although the French Communities in Case T-129/96 Preussag Stahl AG v.
authorities announced that they had ordered the Commission (1),
suspension of the levy in the case of frontier workers, it
should be borne in mind that this is a temporary and
provisional measure which can, by its very nature, be Ð annul Commission Decision 96/544/ECSC of 29 May
altered at the discretion of the competent national 1996 concerning State aid to Walzwerk Ilsenburg
authority. GmbH (OJ L 233, 14.9.1996, p. 24),

Ð order the Commission to pay the costs.
The reasons given by the French authorities for that
suspension were that amendments were being prepared to
the conditions for applying the GSC. In the final analysis, Pleas in law and main arguments adduced in support:
the inescapable conclusion in these proceedings is that the
French authorities have taken no steps to provide a
satisfactory response to the specific and clearly delineated Ð The decision of the Court of First Instance is based
objections raised by the Commission. The application of solely on the finding that the Commission ceased
the GSC none the less affects a large number of migrant ratione temporis to be competent, after 31 December
workers residing in France, of whom frontier workers are 1994, to adopt a decision concerning aid to Walzwerk
just one example, who have thus for many years been in a Ilsenburg. Neither the Treaty nor the Steel Aids Code
position of legal uncertainty which is incompatible with provides any basis for such a conclusion, which the
the principles of Community law. Court of First Instance purports to infer from the
preventive nature of the procedure for examining
proposed grants of aid and from certain material
deadlines for payments of regional aid. If the Court of
The Commission does not therefore consider that First Instance were correct in its view that Article 4(c)
suspension of the levying of the GSC has ended or of the ECSC Treaty precludes any subsequent material
remedied the breach of Community law described by it. assessment of aid which has already been granted, that
would mean that Article 6(4) of the Fifth Steel Aids
Code (2) is unlawful. It is clear from that illogical
(1) OJ, English Special Edition, First Series II, p. 416.
result that the legislature must have considered that
the Commission remains obliged, and thus competent,
to undertake a material assessment of a grant of aid
even after that aid has been paid over to its recipient,