CELEX: 61990CJ0312
Action for annulment
State aid
Letter initiating the procedure under Article 93 (2)
Actionable measure

Grounds
1 By application lodged at the Court Registry on 11 October 1990, the Kingdom of Spain sought under Article 173 of the EEC Treaty the annulment of the Commission' s decision of 3 August 1990 concerning presumed aid granted by the Spanish authorities to the private group of electrical equipment producers Cenemesa, Conelec and Cademesa.
2 After being informed of the Spanish authorities' intention to grant financial assistance to electrical equipment producers, the Commission by letter of 12 January 1990 sought detailed information on those measures.
3 The Spanish authorities repeatedly stated that the measures did not constitute aid within the meaning of Article 92(1) of the EEC Treaty. By letters of 14 and 28 February and 5 April 1990 they informed the Commission that the assistance consisted first in the State' s assuming responsibility for part of the compensation and other benefits required to be paid when workers are laid off and secondly in the waiving of debts due to certain public institutions and bodies. The Spanish authorities also drew the Commission' s attention to the terms of an agreement to wind up the private group in question and emphasized the need for the Commission to investigate the matter quickly.
4 On 15 June 1990 Royal Decree No 810/1990 authorized an out-of-court agreement between creditors in the public sector, the debtor companies and the entity acquiring the production equipment of those companies. On the same day the Spanish authorities sent a letter to the Commission in which they announced that the measures were being implemented and referred to the decision of the Court of Justice in Case 120/73 Lorenz v Federal Republic of Germany [1973] ECR 1471. It is common ground that implementation of the measures began on 3 July 1990.
5 By a decision of 3 August 1990 the Commission initiated the procedure provided for in Article 93(2) of the Treaty. The Kingdom of Spain' s action is brought against that decision.
6 By a document lodged at the Court Registry on 9 November 1990 the Commission raised a preliminary objection of inadmissibility under Article 91(1) of the Rules of Procedure of the Court of Justice on the ground that its decision of 3 August 1990 does not constitute an act adversely affecting the applicant capable of being contested under Article 173. The Commission considers that the decision to initiate the procedure under Article 93(2) is a preparatory investigative step towards the final decision: since it does not alter the legal position of the persons concerned, it cannot affect them. Moreover, the obligation to suspend payment of the proposed aid should not be taken into account in deciding on the admissibility of the action, since it is an inescapable consequence which the Treaty attaches to initiating that procedure.
7 The Commission next argues that if the action were held admissible the system of supervision established by Article 93 would be altered. The Court would then be required to decide whether aid which had not been thoroughly and definitively reviewed by the Commission was compatible with the Treaty. The Commission finally is concerned that a favourable ruling on admissibility may precipitate a proliferation of actions for annulment of decisions initiating the procedure under Article 93(2).
8 The Kingdom of Spain requests the Court to reserve its decision on the objection of inadmissibility for the final judgment while arguing that the Commission' s decision of 3 August 1990 must be regarded as an actionable measure. The Spanish authorities notified the financial assistance to the Commission in good time, in February 1990; the Commission then allowed more than two months elapse before forming an initial view on whether the proposal so notified was compatible with the Treaty. The effect of this lapse of time was to entitle the Spanish Government, in accordance with the judgment in Lorenz, cited above, to implement the proposal after informing the Commission of this by its letter of 15 June 1990. After being granted on 3 July 1990, the aid in question was no longer new aid under Article 93(3) but existing aid under Article 93(1) which the Commission could not order to be suspended. Accordingly, the contested decision, by preventing implementation of the proposal, had legal effects vis-à-vis Spain.
9 Reference is made to the Report for the Hearing for a fuller account of the procedure and the pleas in law and arguments of the parties, which are mentioned or discussed hereinafter only in so far as is necessary for the reasoning of the Court.
10 It is clear from the arguments put forward by the Spanish Government that the action for annulment is directed at the contested decision in so far as it suspends the payment of assistance which the Spanish authorities had already granted and does not concern the Commission' s assessment of the compatibility of the aid with the Treaty. The review by the Court will accordingly be limited to the former aspect of the decision.
11 In order to rule on the admissibility of the action, it should first be noted that a measure may be contested under Article 173 of the Treaty only if has legal effects (see the judgment in Case 22/70 Commission v Council [1971] ECR 263, the "ERTA case").
12 In this case, it should be pointed out at the outset that the decision adopted on 3 August 1990 to initiate the review procedure provided for in Article 93(2) of the Treaty, which was notified to the Spanish Government, prohibited that Government from paying the proposed aid before that procedure had resulted in a final decision.
13 Notwithstanding the Commission' s argument to the contrary, in the circumstances of this case that prohibition is the result of a deliberate decision by it. That becomes clear if the contested measure is placed in the context of the whole system of supervision of aid established by Article 93.
14 The rules of procedure which the Treaty lays down vary according to whether the aid is already in existence or new. While the former is subject to Article 93(1) and (2), the latter is governed by Article 93(2) and (3).
15 With respect to existing aid, Article 93(1) empowers the Commission to keep it under constant review in cooperation with the Member States. In the context of that review, the Commission is to propose to those States any appropriate measures required by the progressive development or by the functioning of the common market. Article 93(2) then provides that if, after giving notice to the parties concerned to submit their comments, the Commission finds that aid is not compatible with the common market having regard to Article 92, or that such aid is being misused, it is to decide that the State concerned shall abolish or alter such aid within such period as may be determined by the Commission.
16 As for new aid, Article 93(3) provides that the Commission is to be informed, in sufficient time to enable it to submit its comments, of any plans to grant or alter aid. The Commission then conducts an initial review of the aid proposed. If at the end of that review it considers a proposal to be incompatible with the common market having regard to Article 92, it must without delay initiate the contentious procedure provided for in Article 93(2). In such a case, the final sentence of Article 93(3) prohibits the Member State concerned from implementing the proposed measures until that procedure has resulted in a final decision. New aid is accordingly subject to the Commission' s preventive control and in principle may not be granted until that institution has declared it to be compatible with the Treaty.
17 It follows from the foregoing that the effects of the decision giving notice to the parties concerned and initiating the procedure under Article 93(2) differ depending on whether the aid in question is new aid or existing aid. In the former case the State is prevented from implementing the aid proposal submitted to the Commission; that prohibition does not apply, however, where the aid is existing aid.
18 According to the judgment in Lorenz, cited above, the effect of Article 93(3) of the Treaty is that, if the Commission, having been informed by a Member State of a plan to grant aid, fails to initiate the contentious procedure, that State may at the expiration of a period of two months grant the proposed aid, provided that it has given prior notice to the Commission, and that aid will then come under the system of existing aid.
19 In this case, it is clear from the facts that the difference between the views of the Spanish Government and the Commission concerns the categorization of the aid at issue. The Commission decided to treat aid as new aid which the Spanish Government regarded as existing aid because it had been granted after the Spanish authorities had notified it to the Commission and given notice to the Commission in accordance with the judgment in Lorenz.
20 In those circumstances, it cannot be considered that in this case suspension of payment of the aid follows automatically from the Treaty. Since it clearly involves a choice of the relevant category of aid and the rules of procedure relating to it, the contested decision to initiate the Article 93(2) procedure has legal effects.
21 Secondly, it must be established that the contested decision is not simply a preparatory step, in which case an action against the decision in which the procedure culminates would ensure sufficient protection against any unlawfulness (see the judgment in Case 53/85 Akzo Chemie v Commission [1986] ECR 1965).
22 It should be noted that the irreversible consequences of a delay in paying aid due to the prohibition in the final sentence of Article 93(3) could not be eradicated by a decision that the aid is compatible with the Treaty or by proceedings brought against a Commission decision that it is incompatible.
23 In addition, where, as in this case, the measures categorized by the Commission as new aid have been implemented, the legal effects of that categorization are definitive. It is clear from the judgment in Case C-354/90 Fédération Nationale du Commerce Extérieur des Produits Alimentaires v French State [1991] ECR I-5505 that even a final decision by the Commission declaring the aid compatible with the common market could not regularize ex post facto the implementing measures which would have to be deemed to be adopted in breach of the prohibition laid down in the final sentence of Article 93(3).
24 It must accordingly be concluded that the decision at issue, involving the choice by the competent institution of a review procedure a feature of which is the suspension of payment of the aid contemplated, is an actionable decision under Article 173 of the Treaty.
25 In reply to the Commission' s objection that there is a risk of prejudging arguments on the compatibility of the aid with the Treaty, it must also be stated that in the course of the review of the merits of these proceedings it will be for the Court alone to decide whether aid granted in the circumstances of this case constitutes new aid subject to the prohibition in Article 93(3) of the Treaty.
26 In the light of the foregoing, the objection of inadmissibility raised under Article 91(1) of the Rules of Procedure of the Court of Justice must be dismissed and the action must be declared admissible.
Decision on costs
Costs
27 The costs should be reserved.
Operative part
On those grounds,
THE COURT
hereby:
1. Dismisses the objection of inadmissibility raised by the Commission of the European Communities;
2. Orders that the action on the merits shall proceed;
3. Orders that the costs be reserved.