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Case:
CE, Sect., 3 novembre 1997, p. 406 Case Million and M
Date:
03 November 1997
Translated by:
Professor Bernard Rudden
Copyright:
Professor B. S. Markesinis

Conseil d’Etat

Application of the Million and Marais Company asking the Conseil d’Etat

(1) to annul the judgment of 9 March 1995 whereby the Orléans Administrative Tribunal rejected the plea of illegality as regards the concession of outdoor funeral arrangements agreed on 26 November 1987 between the town of Fleury-les-Aubrais and the General Funeral Company, remitted to the Tribunal by a decision of the Orléans Court of Appeal of 10 March 1993;

(2) to declare the concession unlawful;

(3) to order the Commune of Fleury-les-Aubrais and the General Funeral Company to pay it the sum of 10,000 francs under article 75-I of the Act of 10 July 1991;

Having seen the Treaty of 25 March 1957 establishing the European Community; the Communes Code; Act no. 82-623 of 2 March 1982; Ordinance no. 86-1243 of 1 December 1986; Act no. 91-647 of 10 July 1991; the Code of Administrative Tribunals and Courts of Appeal; Ordinance no. 45-1708 of 31 July 1945, Decree no. 53-934 of 30 September 1953, and Act no. 87-1127 of 31 December 1987;

Considering that by a decision of 10 March 1993 the Orléans Court of Appeal, seised of a suit between the Million and Marais Company and the General Funeral Compnay, adjourned its proceedings pending a ruling by the administrative courts on the validity of a contract signed on 26 November 1987 by the mayor of Fleury-les-Aubrais, granting the General Funeral Company the concession for outdoor funeral arrangements in that commune; that the Million and Marais Company appeals against the judgment of 9 March 1995 whereby the Orléans Administrative Tribunal rejected its submissions arguing that the concession contract be held invalid;

On the content of the judgment; Considering that it emerges from the record of the challenged judgment that it contains mention and analysis of all the pleadings exchanged; that it dealt adequately with the argument based on breach of article 86 of the Treaty establishing the European Community;

On the submissions as to the resolution of the town council of Fleury-les-Aubrais of 30 November 1987;

Considering that the administrative courts, when seised of a preliminary remitter by the ordinary law-courts, have no jurisdiction to deal with any questions other than those put by the remitting court; that it emerges from the statements of the Orléans Court of Appeal that it intended to adjourn only until the administrative courts decided the validity of the concession contract between the Commune of Fleury-les-Aubrais and the Million and Marais Company; that consequently the submissions in the application requesting a ruling of illegality on the resolution of 30 November 1987 whereby the town council of Fleury-les-Aubrais approved and authorized the mayor to sign the contract, are inadmissible;

On the validity of the concession contract;

Considering that the Court of Appeal remitted to the administrative court only the issue of the merits of the grounds based, on the one hand, on breach of the competition rules both Community and national, and, on the other hand, on the mayor’s lack of authority to sign the contract; that in consequence the Million and Marais Company is not entitled to raise before the administrative courts grounds based on the lack of legal existence of the General Funeral Company at the moment of signing the contract, on the unlawfulness of the concession contract in that it granted to the General Funeral Company a monopoly over the provision of outdoor funeral arrangements in the commune, and on the absence of any tender procedure before the conclusion of the concession contract;

Considering in the first place that it does not emerge from the documents in the record that the contract of concession of outdoor funeral arrangements in the commune of Fleury-les-Aubrais was signed by the mayor before the Prefect was advised of the resolution of 30 November 1997 whereby the town council of Fleury-les-Aubrais authorized the mayor to sign the same;
Considering in the second place that article 9 of the Ordinance of 2 December 1986 provides as follows: ‘Any undertaking, agreement or contract provision entailing practices forbidden by articles 7 and 8 is null and void’; that article 8 forbids the abuse of a dominant position on the national market or a substantial part thereof by any enterprise or group of enterprises; that however, in terms of article 10: ‘The following practices are not subject to the dispositions of articles 7 and 8: (1) those resulting from the application of a legislative text or a regulation issued under it’;

that it follows from these provisions that if, by virtue of article L. 362-1 of the Communes Code cited above, a contract whereby a commune concedes to a firm the outdoor funeral arrangements cannot be challenged for giving the firm an exclusive right to furnish the public service, the clauses of the contract cannot have the legal effect of putting the firm in breach of the above-mentioned provisions of article 8;

Considering that if the contract in dispute, in conferring on the General Funeral Company the exclusive right to furnish the commune’s outdoor funeral arrangements, has, for the benefit of that company, created a dominant position in the sense of the provisions of article 8 of the Ordinance, the contractual term of six years, renewable once by express decision, does not put the Company in breach of the provisions of the Ordinance of 1 December 1986 cited above; that the contract in dispute contains no term covering the furnishing of supplies or the use of a funeral parlour; that the Million and Marais Company is hence not entitled to maintain that, on these two points, the contract would allow the General Funeral Company to abuse its dominant position;

Considering, in the third place, that article 86 of the Treaty establishing the European Community provides as follows: ‘Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market insofar as it may affect trade between member States’; that article 90 provides: ‘In the case of public undertakings and undertakings to which the Member States grant special rights, Member States shall neither enact nor maintain in force any measure contrary to the rules contained in this Treaty, in particular to those rules provided for in article 7 and articles 85 to 94’;

Considering that, on the assumption that the exclusive rights granted by the contract in dispute conferred on the General Funeral Company a dominant position in the provision of funeral arrangements on a substantial part of the Common Market and is capable of affecting inter-Community trade, its terms would be incompatible with article 86 of the Treaty only if the undertaking were led, by the exercise of the exclusive right in the conditions whereby it was conferred, to abuse its dominant position; that the length of time stipulated by the contract in dispute is not an abuse such as to put the Million and Marais Company [sic: General Funeral Company, correxit BR] in breach of the provisions cited above of the Treaty establishing the European Community;

Considering that it follows from the foregoing that the Million and Marais Company is not entitled to complain that the Orléans Administrative Tribunal rejected the plea of illegality as regards the concession contract between the Commune of Fleury-les-Aubrais and the General Funeral Company;

On the submissions as to the application of article 75-1 of the Act of 10 July 1991;

Considering that the provisions of article 75-1 of the Act of 10 July 1991 preclude the Commune of Fleury-les-Asubrais and the General Funeral Company, who are not the losing parties in this case, from being ordered to pay the Million and Marais Company the sum of 10,000 francs claimed in respect of expenditure incurred and not covered byu the costs; that it is not appropriate, in the circumstances of the case, to accede to the submissions of the General Funeral Company and order the Million and Marais Company to pay it the sum of 12,000 francs in respect of expenditure incurred and not covered byu the costs;

(Application rejected, as also the submissions of the General Funeral Company asking for an order under article 75-1 of the Act of 10 July 1991 against the Million and Marais Company).

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