Transocean Marine Paint Association v. Commission of the European Communities

The Transocean Marine Paint Association (association) (plaintiff) was formed by smaller marine-paint manufacturers to help them compete with multinational manufacturers. In 1967, the Commission of the European Communities (commission) (defendant) granted the association a five-year exemption from certain competition-related prohibitions contained in the treaty that created the European Economic Community (EEC Treaty). In October 1972, the association applied for an exemption extension of 10 years. In July 1973, the commission responded with a notice of objections that raised concerns about the fact that two of the association’s members had been acquired by multinational companies. Additionally, the commission stated that its approval of the extension was conditioned on the association’s agreement to promptly notify the commission “regarding any change in the participatory position of the association.” At a hearing regarding the association’s request in September 1973, the commission discussed the acquisition of the two association members. In December 1973, the commission renewed the association’s exemption subject to the requirement that the association’s members immediately notify the commission of (1) any links by way of common directors or managers between an association member and any other industry participant or (2) any financial relationship between an association member and another industry participant (challenged condition). The association sued the commission in the European Court of Justice, seeking to annul the challenged condition. The association contended that the commission never mentioned the challenged condition prior to issuing its December decision, thus depriving the association of the opportunity to be heard in violation of commission Regulation 99/63. The commission responded that Regulation 99/63 did not apply to conditions that the commission intended to attach to an exemption. The commission also said that its July 1973 communication (with respect to which multiple competing English and French translations were submitted to the court) and its expressed concern about association members’ relationships with multinational corporations put the association on notice. The advocate general opined that (1) Regulation 99/63 did not require the commission to notify the association in advance about the challenged condition, (2) the association nevertheless had a right to be heard regarding the challenged condition under EEC Treaty Article 164 because most EEC member states recognized such a right, and (3) the commission did not sufficiently notify the association regarding the challenged condition.