The EU General Court has ordered the Union to pay damages for excessive delays in EU Court proceedings. The ruling in Case T-577/144 was handed down on 10 January. The Court found that the Court was in breach of Article 475 of the Charter of Fundamental Rights of the European Union which guarantees that proceedings must be concluded within a “reasonable time”.
The companies Sachsa Verpackung and Group Gascogne (hereinafter the “Companies”) had, previously, sought the annulment of a decision of the European Commission fining them for violation of antitrust law. They then brought an action for damages under the provisions on the non-contractual liability of the Union for the excessive length of the annulment action in the cases which gave rise to the judgments of 16 November 2011 (Group Gascogne v. Commission) 6 and of 16 November 2011, (Sachsa Verpackung/Commission) 7 (hereinafter the “Cases”).
Pursuant to Article 340, second paragraph TFEU “in the case of non-contractual liability, the Union shall, in accordance with the general principles common to the laws of the Member States, make good any damage caused by its institutions or by its servants in the performance of their duties.”
According to the established case-law8 , the second paragraph of Article 340 TFEU provides that non-contractual liability of the Union and the right to compensation for the damage suffered depends on (i) the unlawfulness of the conduct alleged against the institutions, (ii) the nature of the damage and (iii) the existence of a causal link between that conduct and the damage complained of.
In the present case, the Companies maintained, first, that the length of the proceedings in the Cases violated the reasonable period for a ruling. Secondly, they argued that this violation caused them prejudice which must be remedied.
The Companies argued that the length of the procedures has exceeded in each case a period of 30 months. Such delay was neither reasonable nor justified by the complexity of the subject.
Even though the claims for the annulment of Commission competition decision are compelex and give rise to longer proceedings, the factual, legal and procedural complexity of the Cases does not justify a longer period in this case.
At the same time, claims concerned the competition are relevant for the proper functioning of the internal market and for the legal security of which must benefit not only the Companies directly affected but also third parties, like stakeholders and players.
For these reasons, the judges held that the procedure which was followed in the Cases infringed Article 47, second paragraph, of the Charter of Fundamental Rights in so far as it exceeded the reasonable period for a judgment by 20 months, which constitutes a sufficiently serious breach of a rule of European Union law intended to confer rights on individuals.
Moreover, the judges recognized the cumulative presence of the three conditions requested by Article 340 TFUE which consent to start the proceed for non-contractual liability of the Union. In particular, about the damage, the Companies proved the actual material damage due to the costs of setting up a bank guarantee in order to pay the fine to the Commission.
The Union has been ordered to pay Euro 47,064.33 to the Companies, (with added interest) for pecuniary damage and Euro 5,000 to each company for the non-pecuniary damage caused by the uncertainty due to the prolongation.