**Joined Cases T-111/01 and T-133/01**

**Saxonia Edelmetalle GmbH and J. Riedemann as liquidator of ZEMAG GmbH**

**v**

**Commission of the European Communities**

(State aid – Restructuring – Misuse of State aid – Recovery of aid – Article 88(2) EC – Regulation (EC) No 659/1999)

Judgment of the Court of First Instance (First Chamber, Extended Composition), 11 May 2005

Summary of the Judgment

1.     *State aid – Administrative procedure – Obligation for the Commission to put the parties concerned on notice to submit their
observations – Form and content of the notice*

*(Art. 88(2) EC; Council Regulation No 659/1999, Arts 6(1) and 16)*

2.     *State aid – Administrative procedure – Obligation for the Commission, where the Member State has failed to comply with its
injunction to supply information, to consult the parties concerned – None*

*(Council Regulation No 659/1999, Arts 13(1), 14 and 16)*

3.     *Actions for annulment – Pleas in law – Pleas that may be raised against a Commission decision on State aid – Pleas not raised
in the administrative procedure – Distinction between admissible pleas in law and inadmissible pleas of fact*

*(Arts 88(2) EC and 230 EC)*

4.     *State aid – Aid authorised by the Commission – Misuse of the aid by the beneficiary – Burden of proof on the Commission –
Refusal by the Member State concerned to obey the injunction to provide information – Consequences*

*(Art. 88(2) EC; Council Regulation No 659/1999, Arts 1(g), 13 and 16)*

5.     *State aid – Aid authorised by the Commission – Misuse of the aid by the beneficiary – Discretion of the Commission – Judicial
review – Limits*

6.     *State aid – Recovery of unlawful aid – Obligation resulting from the unlawfulness – Subject-matter – Restoration of the prior
situation – Application mutatis mutandis in the event of misuse of aid*

*(Art. 88(2) EC; Council Regulation No 659/1999, Arts 1(g), 14 and 16)*

7.     *Acts of the institutions – Statement of reasons – Obligation – Scope – Refusal to take into consideration, in a decision ordering
the reimbursement of unlawful aid, the information provided by the Member State concerned following an injunction*

*(Art. 253 EC; Council Regulation No 659/1999, Arts 10(3) and 13(1))*

1.     The procedure for reviewing State aid is, in view of its general scheme, a procedure initiated in respect of the Member State
responsible, in the light of its Community obligations, for granting the aid and not in respect of the beneficiary or beneficiaries
of the aid.

For the purposes of Article 88(2) EC ‘parties concerned’ refers to an undetermined group of addressees. It follows that Article
88(2) EC does not require that specific parties be put on notice individually. Its sole purpose is to require the Commission
to take steps to ensure that all parties potentially concerned are informed and given the opportunity to put forward their
arguments. In that context, the publication of a notice in the *Official Journal of the European Communities* is an appropriate means of informing all the parties concerned that a procedure has been initiated. Consequently, that solution
confers on the parties concerned essentially the role of information sources for the Commission in the administrative procedure
instituted under Article 88(2) EC.

Of course, the mere fact of being informed of the opening of a formal procedure does not suffice to enable a party to effectively
make known its observations. The Court notes that Article 6(1) of Regulation No 659/1999 laying down detailed rules for the
application of Article [88 EC], which is also applicable, by virtue of Article 16 of that regulation, to misused aid, provides
that the decision to open the formal investigation procedure, despite the necessarily temporary nature of the assessment it
entails, must be sufficiently precise to enable the parties concerned to participate in an effective manner in the formal
investigation procedure during which they will have the opportunity to put forward their arguments. To that end, it suffices
that the parties concerned may familiarise themselves with the reasoning relied on by the Commission.

Since the Commission did, through the notice published in the *Official Journal of the European Communities*, invite the beneficiaries of aid initially authorised by a previous decision to submit their observations on possible violation
of the decision in question due to use of that aid in a manner contrary to that decision and those beneficiaries did not take
advantage of that opportunity, the Commission did not violate any of their rights.

(see paras 47-48, 50-51, 53)

2.     It follows from Article 13(1) of Regulation No 659/1999 laying down detailed rules for the application of Article [88 EC]
that, where the Member State fails to respond to the Commission’s injunction decision ordering that certain information be
provided, the Commission is empowered to end the formal investigation procedure and to adopt a decision declaring that the
aid is or is not compatible with the common market on the basis of the information available. That decision may, subject to
the conditions provided for in Article 14 of Regulation No 659/1999, order the recovery of previously-paid aid from its beneficiary.
Under Article 16 of Regulation No 659/1999, Articles 13 and 14 apply mutatis mutandis in the event of misuse of aid. It follows
from those provisions that the Commission is not under a duty to consult the parties concerned in cases where a Member State
fails to comply with the Commission’s injunction to provide information.

(see para. 58)

3.     In the context of an action for annulment under Article 230 EC the legality of a Community measure falls to be assessed on
the basis of the elements of fact and of law existing at the time when the measure was adopted. In particular, the assessments
made by the Commission must be examined solely on the basis of the information available to the Commission at the time when
those assessments were made.

It follows that an applicant who has participated in the investigation procedure provided for by Article 88(2) EC cannot rely
on factual arguments of which the Commission was unaware and of which it did not inform the Commission in the course of the
investigation procedure. By contrast, nothing prevents the party concerned from formulating against the final decision a legal
plea which was not raised at the stage of the administrative procedure.

That solution may, subject to certain exceptional cases, apply by extension to cases where an undertaking has not participated
in the investigation procedure provided for by Article 88(2) EC.

(see paras 67-69)

4.     A reading of Article 88(2) EC, together with Article 1(g) and Article 16 of Regulation No 659/1999 laying down detailed rules
for the application of Article [88 EC], shows that it is in principle for the Commission to establish that all or part of
the aid previously authorised by it by an earlier decision has been misused by the beneficiary. If it fails to do so, that
aid is to be considered as being covered by its previous approval decision.

Nevertheless, the reference in Article 16 of Regulation No 659/1999 to Article 13 authorises the Commission, in cases where
a Member State fails to comply with an order to provide information, to adopt a decision closing the formal investigation
procedure on the basis of the information available. Thus, when a Member State fails to provide sufficiently clear and precise
information on the use of the aid about which the Commission, on the basis of the information it has available, expresses
doubts as to compliance with its earlier approval decision, the Commission is empowered to find that the aid in question has
been abused.

(see paras 86, 93)

5.     When the assessment which the Commission must conduct involves the consideration and assessment of economically complex facts
and circumstances, given that the Community Court may not substitute its assessment for that of the Commission, the Court’s
review must be limited to verifying compliance with procedural rules and the obligation to state reasons, as well as the material
accuracy of the facts, and ensuring that there has been no manifest error of assessment or misuse of powers. Such is the case
when the Commission’s assessment is of whether all or part of the aid previously authorised by it was misused by the beneficiary.

(see paras 90-91)

6.     In accordance with Community law, when the Commission finds that aid is incompatible with the common market, it may require
the Member State which paid the aid to recover it from the recipient. Removing unlawful aid by means of recovery is the logical
consequence of a finding that it is unlawful and seeks to re-establish the previous situation. That purpose is achieved once
the aid in question, together where appropriate with default interest, has been repaid by the recipient or, in other words,
by the undertakings which actually benefited from it. By repaying the aid, the recipient forfeits the advantage which it had
enjoyed over its competitors on the market, and the situation prior to payment of the aid is restored. Consequently, the main
purpose of the repayment of unlawfully paid State aid is to eliminate the distortion of competition caused by the competitive
advantage afforded by the unlawful aid.

It cannot in principle be otherwise as regards the repayment of aid paid by a Member State which, pursuant to a decision adopted
by the Commission, is considered to have been misused pursuant to Article 88(2) EC and Article 1(g) of Regulation No 659/1999
laying down detailed rules for the application of Article [88 EC]. The Court notes in this respect that Article 16 of Regulation
No 659/1999 provides inter alia that Article 14 of the same regulation, in so far as it requires recovery from the beneficiary
of aid found to be illegal, applies mutatis mutandis in the event of aid being misused. Consequently, misused aid must, in
principle, be recovered from the undertaking which has had the actual use thereof, which may be different from the undertaking
listed as the beneficiary in the decision authorising the aid, in order to eliminate the distortion of competition caused
by the competitive advantage afforded by it.

(see paras 111-115, 125)

7.     In order to satisfy the requirements of Article 253 EC, the statement of reasons for a decision must be appropriate to the
act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted
the measure in question so as to enable the persons concerned to ascertain the reasons for the measure and to enable the Community
judicature to exercise its power of review. Although it is not necessary for the reasoning to go into all the relevant facts
and points of law, it must be assessed with regard not only to its wording but also to its context and to all the legal rules
governing the matter in question.

Although when the Commission, acting pursuant to Article 10(3) of Regulation No 659/1999 laying down detailed rules for the
application of Article [88 EC], issues an information injunction it may, pursuant to Article 13(1) of that regulation, ‘where
... the Member State concerned does not provide the information requested’, adopt a decision to close the investigation procedure
on the basis of the information available, it is not released from its obligation to state sufficiently the reasons which
have led it to consider that the information provided by a Member State, in response to the information injunction, cannot
be relied on in the final decision which it intends to adopt. Such a situation cannot be likened to one where a Member State
fails to provide any information to the Commission in response to an injunction issued pursuant to Article 10(3) of Regulation
No 659/1999, in which case the reasons may be limited to merely stating that the Member State has failed to respond to the
injunction.

(see paras 138, 145)

JUDGMENT OF THE COURT OF FIRST INSTANCE (First Chamber, Extended Composition)

11 May 2005 (*)

(State aid – Restructuring – Misuse of State aid – Recovery of aid – Article 88(2) EC – Regulation (EC) No 659/1999)

In Joined Cases T-111/01 and T-133/01,

**Saxonia Edelmetalle GmbH,** established in Haslbrücke (Germany), represented by P. von Woedtke, lawyer,

applicant in Case T-111/01,

and

**J. Riedemann as liquidator of ZEMAG GmbH,** established in Zeitz (Germany), represented by U. Vahlhaus, lawyer, with an address for service in Luxembourg,

applicant in Case T-133/01,

v

**Commission of the European Communities,** represented by V. Kreuschitz and V. Di Bucci, acting as Agents, with an address for service in Luxembourg,

defendant,

APPLICATION for annulment of Commission Decision 2001/673/EC of 28 March 2001 on State aid implemented by Germany for EFBE
Verwaltungs GmbH & Co. Management KG, now Lintra Beteiligungsholding GmbH, together with Zeitzer Maschinen, Anlagen Geräte
GmbH, LandTechnik Schlüter GmbH, ILKA MAFA Kältetechnik GmbH, SKL Motoren- und Systembautechnik GmbH, SKL Spezialapparatebau
GmbH, Magdeburger Eisengießerei GmbH, Saxonia Edelmetalle GmbH and Gothaer Fahrzeugwerk GmbH) (OJ 2001 L 236, p. 3),

THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES (First Chamber, Extended Composition),

composed of B. Vesterdorf, President, M Jaeger, P. Mengozzi, M.E. Martins Ribeiro and M.F. Dehousse, Judges,

Registrar: D. Christensen, Administrator,

having regard to the written procedure and further to the hearing on 29 June 2004,

gives the following

**Judgment**

**Legal framework**

1       Article 87(1) EC provides:

‘Save as otherwise provided in this Treaty, any aid granted by a Member State or through State resources in any form whatsoever
which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall,
in so far as it affects trade between Member States, be incompatible with the common market.’

2       Article 88(2) EC provides:

‘If, after giving notice to the parties concerned to submit their comments, the Commission finds that aid granted by a State
or through State resources is not compatible with the common market having regard to Article 87, or that such aid is being
misused, it shall decide that the State concerned shall abolish or alter such aid within a period of time to be determined
by the Commission ...’

3       On 22 March 1999 the Council adopted Council Regulation (EC) No 659/1999 laying down detailed rules for the application of
Article [88] of the EC Treaty (OJ 1999 L 83, p. 1).

4       According to Article 1(g) of Regulation No 659/1999, ‘misuse of aid’ means ‘aid used by the beneficiary in contravention of
a decision taken pursuant to Article 4(3) or Article 7(3) or (4) of this Regulation’, that is, in violation of a decision
not to raise objections to the granting of aid, or a decision declaring aid to be compatible with the common market, that
decision possibly including, where applicable, conditions and obligations.

5       Article 6(1) of Regulation No 659/1999 provides:

‘The decision to initiate the formal investigation procedure shall summarise the relevant issues of fact and law, shall include
a preliminary assessment of the Commission as to the aid character of the proposed measure and shall set out the doubts as
to its compatibility with the common market. The decision shall call upon the Member State concerned and upon other interested
parties to submit comments within a prescribed period which shall normally not exceed one month. In duly justified cases,
the Commission may extend the prescribed period.’

6       According to Article 10 of Regulation No 659/1999:

‘1. Where the Commission has in its possession information from whatever source regarding alleged unlawful aid, it shall examine
that information without delay.

2. If necessary, it shall request information from the Member State concerned. Article 2(2) and Article 5(1) and (2) shall
apply mutatis mutandis.

3. Where, despite a reminder pursuant to Article 5(2), the Member State concerned does not provide the information requested
within the period prescribed by the Commission, or where it provides incomplete information, the Commission shall by decision
require the information to be provided (hereinafter referred to as an “information injunction”). The decision shall specify
what information is required and prescribe an appropriate period within which it is to be supplied.’

7       Article 13(1) of Regulation No 659/1999 provides:

‘The examination of possible unlawful aid shall result in a decision pursuant to Article 4(2), (3) or (4). In the case of
decisions to initiate the formal investigation procedure, proceedings shall be closed by means of a decision pursuant to Article
7. If a Member State fails to comply with an information injunction, that decision shall be taken on the basis of the information
available.’

8       Article 14 of Regulation No 659/1999 provides:

‘1. Where negative decisions are taken in cases of unlawful aid, the Commission shall decide that the Member State concerned
shall take all necessary measures to recover the aid from the beneficiary (hereinafter referred to as a “recovery decision”).
The Commission shall not require recovery of the aid if this would be contrary to a general principle of Community law.

2. The aid to be recovered pursuant to a recovery decision shall include interest at an appropriate rate fixed by the Commission.
Interest shall be payable from the date on which the unlawful aid was at the disposal of the beneficiary until the date of
its recovery.

3. Without prejudice to any order of the Court of Justice of the European Communities pursuant to Article [242] of the Treaty,
recovery shall be effected without delay and in accordance with the procedures under the national law of the Member State
concerned, provided that they allow the immediate and effective execution of the Commission’s decision. To this effect and
in the event of a procedure before national courts, the Member States concerned shall take all necessary steps which are available
in their respective legal systems, including provisional measures, without prejudice to Community law.’

9       Article 16 of Regulation No 659/1999, entitled ‘Misuse of aid’, states:

‘Without prejudice to Article 23, the Commission may in cases of misuse of aid open the formal investigation procedure pursuant
to Article 4(4). Articles 6, 7, 9 and 10, Article 11(1), Articles 12, 13, 14 and 15 shall apply mutatis mutandis.’

**Background to the dispute**

10     In 1993, eight undertakings in the former German Democratic Republic (Zeitzer Maschinen, Anlagen Geräte (ZEMAG) GmbH, LandTechnik
Schlüter GmbH, ILKA MAFA Kältetechnik GmbH, SKL Motoren- und Systembautechnik GmbH, SKL Spezialapparatebau GmbH, Magdeburger
Eisengießerei GmbH, Saxonia Edelmetalle GmbH and Gothaer Fahrzeugwerk GmbH) were reorganised into a holding company, EFBE
Verwaltungs GmbH & Co. Management KG, held by the Treuhandanstalt (subsequently changed to the Bundesanstalt für vereinigungsbedingte
Sonderaufgaben, ‘the BvS’) with a view to restructuring and privatisation.

11     Pursuant to a privatisation contract signed on 25 November 1994, the BvS made a block sale of the eight abovementioned undertakings
to a partnership governed by German law, Emans & Partner GbR. The eight undertakings and the holding company EFBE Verwaltungs
GmbH & Co. Management KG, later Lintra Beteiligungsholding GmbH (‘the Lintra holding company’), then formed the Lintra group.

12     Since the privatisation project, as well as the related restructuring project, included aid measures, they were notified by
the Federal Republic of Germany to the Commission by letter of 19 January 1995.

13     By decision SG (96) D/4218 of 13 March 1996, a brief summary of which was published in OJ 1996 C 168, p. 10 (‘the decision
of 13 March 1996’), the Commission authorised the payment of the notified aid measures, considered as being compatible with
Article 92(3)(c) of the EC Treaty (now, after amendment, Article 87(3)(c) EC). That decision was notified to the German authorities
by letter of 23 April 1996. The total amount of authorised aid to be paid to the Lintra group amounted to DEM 824 200 000.

14     Although originally it was planned that the subsidiaries of the Lintra holding company (‘the Lintra subsidiaries’ or ‘the
subsidiaries’) would become profitable in 1998, at the end of 1997 the BvS had to intervene in order to prevent the entire
group from going bankrupt. Under the terms of the contract signed on 6 January 1997 with the investors, the BvS released them
from all liability relating to the privatisation contract. In return, BvS obtained the right to repurchase at any time any
of the Lintra subsidiaries for the symbolic amount of DEM 1. Under the same contract, the Lintra holding company had as its
principal objective the transfer of the Lintra subsidiaries in their entirety or in part to new investors.

15     After having retaken control of the Lintra group by contract of 6 January 1997, the BvS decided to sell the only company in
the group which at that time was already profitable without the grant of new aid, namely Saxonia Edelmetalle. The applicant
in Case T‐111/01, which is involved in the striking of coins, was acquired by the company Vereinigte Deutsche Nickelwerke
AG in 1997.

16     At the same time, the BvS decided to pursue the restructuring of several other subsidiaries, including the company ZEMAG,
with a view to preparing those potentially profitable companies for sale to industrial partners as soon as possible. ZEMAG,
the applicant in Case T‐133/01, which is involved in machines for lignite mines, was sold to the investors Jacobi & Lobeck
at the end of 1997.

17     Pursuant to a contract signed in September 1999 by the BvS, the Lintra holding company and the remaining investors, the BvS
repurchased the Lintra holding company for the symbolic amount of DEM 1. That company has been in liquidation since 1 January
2000.

18     After receiving notification from the Federal Republic of Germany of new restructuring aid in 1998, the Commission sent a
list of questions to the German authorities by letter of 25 June 1998.

19     By letter of 22 June 1999, the Commission informed the Federal Republic of Germany of its decision to open the procedure provided
for in Article 88(2) EC. By that decision (OJ 1999 C 238, p. 4), the Commission found that the amount of aid actually paid
since the first notification from the German authorities was lower than that authorised by the decision of 13 March 1996.
It noted, however, that some parts of the aid paid, including a liquidity loan of DEM 12 000 000, were not covered by the
decision of 13 March 1996. The Commission also expressed doubts on the following points:

–       whether the information obtained prior to the decision of 13 March 1996 was complete and accurate;

–       the use of the aid approved by the decision of 13 March 1996;

–       the granting of other aid to the Lintra group.

20     By letters of 18 October 1999 and 10 March 2000, the German authorities responded to the questions and findings made by the
Commission in its decision to open the procedure provided for by Article 88(2) EC. That correspondence indicates that:

–       since the first notification from the German authorities, the total amount of aid paid by the BvS to the Lintra group was
DEM 658 200 000;

–       as at 31 December 1997, DEM 34 978 000 stood in the accounts of the Lintra holding company;

–       the liquidity loan of DEM 12 000 000 had been granted in 1997 to the Lintra subsidiaries, the restructuring of which in particular
that of ZEMAG, was to continue.

21     On 1 August 2000, the Commission, considering that information to be insufficient and acting pursuant to Article 10(3) of
Regulation No 659/1999, requested the German authorities to provide it, within one month from receipt of the information injunction
decision (‘the information injunction decision of 1 August 2000’), with all information necessary in order to be able to determine
the breakdown of the expenditure of the Lintra holding company amongst the different subsidiaries and allocate appropriately
the amount of aid remaining in the accounts of the Lintra holding company. The Commission also requested the Federal Republic
of Germany to state whether the fees paid by the subsidiaries to the Lintra holding company had been financed by aid and stated
that, if it did not receive that information, it would make its decision on the basis of the information it did have. Lastly,
the Commission requested the German authorities to forward immediately a copy of the information injunction decision of 1
August 2000 to any aid recipients.

22     The German authorities replied to that information injunction decision by letter of 2 October 2000, supplemented by a letter
of 31 October 2000, to which was attached a report from a chartered accountant concerning a possible request for recovery
of the aid from the Lintra group. In those documents, the German authorities confirmed that, as at 31 December 1997, the amount
of DEM 34 978 000, granted by the Federal Republic of Germany to the Lintra group, stood in the accounts of the Lintra holding
company. Moreover, it stated that that amount was composed, on the one hand, of an outstanding balance of DEM 22 978 000 which
was part of the equity capital of the Lintra holding company, most of which (DEM 18 638 000) was made up of group fees paid
by the subsidiaries to the holding company and, on the other, of an amount of DEM 12 000 000 intended to cover expenses incurred
by the Lintra holding company in order to restructure the Lintra subsidiaries which could become profitable after 1997.

23     On 1 March 2001, J. Riedemann was appointed receiver of the company ZEMAG, which had been put into liquidation.

24     By Commission Decision 2001/673/EC of 28 mars 2001 on State aid implemented by Germany for EFBE Verwaltungs GmbH & Co. Management
KG (now Lintra Beteiligungsholding GmbH, with the companies Zeitzer Maschinen, Anlagen Geräte GmbH, LandTechnik Schlüter GmbH,
ILKA MAFA Kältetechnik GmbH, SKL Motoren- und Systembautechnik GmbH, SKL Spezialapparatebau GmbH, Magdeburger Eisengießerei
GmbH, Saxonia Edelmetalle GmbH and Gothaer Fahrzeugwerk GmbH) (OJ 2001 L 236, p. 3) (‘the contested decision’), the Commission
found that aid amounting to DEM 623 224 000 was granted in conformity with the decision of 13 March 1996 (Article 1 of the
contested decision). However, in Article 2 of the contested decision, the Commission found that aid amounting to DEM 34 978 000,
which it had authorised for the restructuring of the Lintra subsidiaries, had been misused within the meaning of Article 88(2)
EC. The Commission therefore requested the Federal Republic of Germany to take all necessary measures to recover the amount
of DEM 34 978 000 from the Lintra holding company and the Lintra subsidiaries as follows. First, the partial amount of DEM
12 000 000, which was granted in the form of liquidity loans to certain Lintra subsidiaries and considered as not being covered
by the decision of 13 March 1996, was to be recovered from those subsidiaries, including a share of DEM 4 077 000 from ZEMAG.
Second, the remaining aid in the amount of DEM 22 978 000 was to be recovered from the Lintra holding company, which was liable
for the full amount as joint and several debtor, and from all of the Lintra subsidiaries, according to a given apportionment
formula. Under that apportionment formula, Article 3 of the contested decision requires the Federal Republic of Germany to
recover an amount of DEM 3 195 559 from Saxonia Edelmetalle and an amount of DEM 2 419 271 from ZEMAG. Thus the Federal Republic
of Germany was required to recover from the latter undertaking a total amount of DEM 6 496 271. The aid to be recovered was
to be supplemented by interest as from the date from which the misused aid was made available to the beneficiaries until it
was actually recovered.

**Procedure and forms of order sought**

25     By applications lodged at the Registry of the Court of First Instance on 23 May 2001 and 12 June 2001, registered as T‐111/01
and T‐133/01 respectively, the applicants brought the present actions.

26     By separate document, lodged at the Registry of the Court of First Instance on 14 June 2001, the applicant in Case T‐111/01
also applied for a stay of execution of the contested decision.

27     By order of 2 August 2001 in Case T‐111/01 R *Saxonia Edelmetalle* v *Commission* [2001] ECR II‐2335, the President of the Court of First Instance dismissed the application for interim measures.

28     The written procedure was closed on 10 January 2002 in Case T‐111/01 and on 11 January 2002 in Case T‐133/01.

29     On hearing the report of the Judge-Rapporteur, the Court of First Instance (First Chamber, Extended Composition), by way of
measures of organisation of procedure, requested the parties to reply to certain questions and to produce certain documents.

30     By order of 17 December 2003 of the President of the First Chamber, Extended Composition, of the Court of First Instance,
Cases T‐111/01 and T‐133/01 were joined for the purposes of the oral procedure and judgment, in accordance with Article 50
of the Rules of Procedure of the Court of First Instance.

31     Following the decision of the Court of First Instance to open the oral procedure, the arguments of the parties were heard
as were their replies to the questions put by the Court of First Instance at the hearing on 29 June 2004.

32     The applicant in Case T‐111/01 claims that the Court of First Instance should:

–       annul the contested decision;

–       order the Commission to pay the costs.

33     The applicant in Case T‐133/01 claims that the Court of First Instance should:

–       principally, annul the contested decision in so far as it relates to it;

–       in the alternative, annul the contested decision in its entirety;

–       order the Commission to pay the costs.

34     The Commission contends that the Court of First Instance should in Cases T‐111/01 and T‐133/01:

–       dismiss the actions;

–       order the applicants to pay the costs.

**Law**

35     In support of their forms of order seeking annulment, the applicants each put forward five pleas, including four common pleas,
which the Court of First Instance considers appropriate to examine in the following order: first, the common plea relating
to violation of the applicants’ rights in the procedure provided for by Article 88(2) EC; second, the plea relating to factual
errors in the contested decision (Case T‐133/01); third, the plea relating to the alleged error in the finding of misuse of
aid authorised by the decision of 13 March 1996 (Case T‐111/01); fourth, the common plea relating to the error committed by
the Commission in the determination of the beneficiary of the disputed aid; fifth, the common plea relating to the arbitrary
nature of the manner in which the recovery of the partial amount of DEM 22 978 000 was apportioned amongst the subsidiaries;
lastly and sixthly, the common plea relating to the alleged error of assessment of the imputability of the obligation to repay
the disputed aid owing to the termination of the respective partnership shares of Saxonia Edelmetalle and ZEMAG.

*The common plea relating to violation of the applicants’ rights in the procedure provided for in Article 88(2) EC*

Arguments of the parties

–       In Case T‐111/01

36     The applicant in Case T‐111/01 states that the considerations behind the decision to open the procedure provided for in Article
88(2) EC did not concern it or were not directed to it. Moreover, recital 36 of the contested decision confirms that the restructuring
plan pertaining to it was implemented successfully. The fact that in that context the German authorities did not provide the
information and documents requested by the Commission cannot operate to the detriment of the applicant. First of all, the
applicant states that the Commission is required by Regulation No 659/1999 to carry out its own checks. Second, the applicant
observes that the Commission is seeking to recover previously approved aid. That approval gave rise to a legitimate expectation
on the part of the applicant that the aid was lawful. It adds that it was not informed of the risk of having to repay the
disputed aid because it was not familiar with the content of the approval decision and had not been invited to participate
in the investigation which preceded the opening of the procedure under Article 88(2) EC. The applicant adds that the Lintra
holding company left it completely in the dark as to which amounts were to be considered as aid. Lastly, the applicant states
that had it known of the risk of having to repay the aid, it would have carried out its own checks and would have signed an
agreement with the Lintra holding company with a view to precluding that risk.

37     The Commission observes first that, in the administrative procedure concerning State aid, only the Member States enjoy all
of the rights conferred on parties. With respect to potential or actual aid beneficiaries, the Commission states that it is
obliged merely to put the parties concerned on notice to submit their observations. It states that it is not in any way required
to have the parties concerned check the information provided by the Member States. In the present case, the Commission states
that it based its decision on the information provided by the Federal Republic of Germany, and that the applicant did not
deem it necessary to intervene in the administrative procedure, even though the parties concerned were invited to submit their
observations when the procedure was opened. It follows, in the Commission’s view, that the applicant cannot now criticise
it for having adopted the contested decision on the basis of insufficient information. The Commission states that it acted
in accordance with the Court of Justice’s case-law and the relevant provisions of Regulation No 659/1999.

38     Next, the Commission challenges the applicant’s statement that it was not informed of the decision of 13 March 1996. According
to the Commission, since the applicant does not deny that it received considerable financial assistance from the State, it
is inconceivable that it did not notice that it received that aid. In the Commission’s view, by virtue of the duty of diligence
incumbent on any economic operator, the applicant should have ascertained that the disputed aid had been the subject of the
necessary authorisation from the Commission. In those circumstances, the Commission submits that the applicant cannot rely
on its own ignorance in order to avoid repaying the aid.

39     Lastly, in the Commission’s view, the applicant is wrong to consider that it is required to repay aid only when it has committed
a ‘fault’. Nothing prevents the beneficiary of the aid from having to suffer the consequences of the fact that information
provided by the State concerned to the Commission may not have been sufficient.

–       In Case T‐133/01

40     The applicant in Case T‐133/01 maintains that, before adopting the contested decision, the Commission should have determined
and assessed the facts by conducting a more thorough investigation. The applicant considers that the Commission was required
to question it, particularly after the Commission had admitted that the German authorities were not able to provide all of
the relevant information. In the applicant’s view, only the Federal Republic of Germany was put on notice and interested third
parties were not, contrary to what is provided for in Article 88(2) EC.

41     In response to the Commission’s statement that it invited parties concerned to submit their observations when the administrative
procedure was opened, the applicant, while acknowledging that its receiver did not participate in that procedure, states that
he was not able to do so at the time, since the liquidation procedure for ZEMAG had not yet commenced. In any event, contrary
to what the Commission maintains, the applicant considers that it cannot refrain from pointing to an inaccuracy in the contested
decision on the ground that it did not participate in the administrative procedure. In its view, such a conclusion would render
meaningless the rights of action of third parties.

42     The Commission states that, in the present case, one cannot speak of a ‘hasty procedure’, since the procedure provided for
in Article 88(2) EC was commenced on 22 June 1999 and was closed only 21 months later, by the adoption of the contested decision
on 28 March 2001. Accordingly, ZEMAG had sufficient time to participate in that procedure. The Commission also reiterates
the position expressed in paragraph 37 above.

43     With respect to the applicant’s argument that its receiver was unable to submit his observations because insolvency proceedings
had not yet been opened, the Commission replies that the applicant thereby disregards the fact that the receiver does not
act in his own name and that the applicant could have submitted its observations when the formal investigation procedure was
opened.

44     Lastly, the Commission states that the applicant cannot rely on facts or circumstances of which it had knowledge at the time
of the formal investigation procedure but which it did not communicate to the Commission after having been invited to submit
its observations. Contrary to what the applicant alleges, the Commission considers that such an approach does not compromise
the rights of action of interested parties, since they always have the possibility of relying on a plea not put forward during
the assessment procedure or an error of assessment on the part of the Commission.

Findings of the Court

45     By this plea, the applicants essentially criticise the Commission for not having put them on notice individually to submit
their observations before adopting the contested decision.

46     That plea cannot be accepted.

47     First, it should be borne in mind that the procedure for reviewing State aid is, in view of its general scheme, a procedure
initiated in respect of the Member State responsible, in light of its Community obligations, for granting the aid (Case 234/84
*Belgium* v *Commission* (*Meura*) [1986] ECR 2263, paragraph 29, and Case T‐109/01 *Fleuren Compost* v *Commission*[2004] ECR II‐127, paragraph 42), and not in respect of the beneficiary or beneficiaries of the aid (Joined Cases C‐74/00 P
and C‐75/00 P*Falck and Acciaierie di Bolzano* v *Commission*[2002] ECR I‐7869, paragraph 83, and*Fleuren Compost* v *Commission*, paragraph 44).

48     Moreover, according to settled case-law, for the purposes of Article 88(2) EC ‘parties concerned’ refers to an undetermined
group of addressees. It follows that Article 88(2) EC does not require that specific parties be put on notice individually.
Its sole purpose is to require the Commission to take steps to ensure that all parties potentially concerned are informed
and given the opportunity to put forward their arguments. In that context, the publication of a notice in the *Official Journal of the European Communities* is an appropriate means of informing all the parties concerned that a procedure has been initiated (Case 323/82 *Intermills* v *Commission*[1984] ECR 3809, paragraph 17, and Joined Cases T‐371/94 and T‐394/94 *British Airways and Others* v *Commission*[1998] ECR II‐2405, paragraph 59). That case-law confers on the parties concerned essentially the role of information sources
for the Commission in the administrative procedure instituted under Article 88(2) EC (Case T‐266/94 *Skibsværftsforeningen and* *Others* v *Commission*[1996] ECR II‐1399, paragraph 256, and *British Airways and Others* v*Commission*, paragraph 59).

49     In the present case, although it is common ground that the applicants did not participate in the formal investigation procedure,
it is clear from the wording of the notice published in the *Official Journal of the European Communities* on 21 August 1999 (OJ 1999 C 238, p. 4) that the parties concerned were invited to submit their observations within one month
from the date of publication of the letter of 22 June 1999 from the Commission by which it notified the Federal Republic of
Germany of its decision to open the procedure provided for in Article 88(2) EC. By that notice, which contained a summary
of the aforementioned letter and the text thereof, the parties concerned were therefore informed of the Commission’s decision
to open the formal investigation procedure in the context of aid having been paid for the restructuring of eight undertakings,
including Saxonia Edelmetalle and ZEMAG.

50     Of course, the mere fact of being informed of the opening of a formal procedure does not suffice to enable a party to effectively
make known its observations. The Court notes that Article 6(1) of Regulation No 659/1999, which is also applicable, by virtue
of Article 16 of that regulation, to misused aid, provides that ‘[t]he decision to initiate the formal investigation procedure
shall summarise the relevant issues of fact and law, shall include a preliminary assessment of the Commission as to the aid
character of the ... measure and shall set out the doubts as to its compatibility with the common market’. It follows that the
decision to open the formal investigation procedure, despite the necessarily temporary nature of the assessment it entails,
must be sufficiently precise to enable the parties concerned to participate in an effective manner in the formal investigation
procedure during which they will have the opportunity to put forward their arguments. To that end, it suffices that the parties
concerned may familiarise themselves with the reasoning relied on by the Commission.

51     The Court notes, however, that the applicants have not pleaded that the decision to open the procedure did not contain sufficient
reasons to enable them to exercise effectively their right to submit observations.

52     Even if the applicants had relied on such an argument, the Court notes that, by the notice referred to in paragraph 49 above,
the Commission set out in a sufficiently clear manner its doubts as to the compliance with the conditions laid down in the
decision of 13 March 1996 and thus enabled the applicants to effectively exercise their right to submit observations. The
Commission found, first, that the key elements of the restructuring plans, as they had been approved, had not been implemented.
It found, second, that the decision of 13 March 1996 no longer covered the aid in question and gave several specific examples,
including aid intended to cover the undertakings’ losses and to finance investment after the failure of the restructuring
plans. The Commission also stated that it was possible that supplementary aid had been granted to the undertakings in the
Lintra group in an amount totalling over DEM 82 000 000. It also expressed doubts as to the compatibility of that aid with
the common market, particularly because some of the aid may have been used for purposes other than restructuring of the Lintra
subsidiaries and because the restructuring plans had not been fully implemented. In addition, the Commission specifically
drew the attention of the German authorities and potential parties concerned to the fact that aid found to have been granted
illegally would have to be recovered from the beneficiary.

53     Since the Commission did, through the notice published in the *Official Journal of the European Communities*, invite the beneficiaries of aid initially authorised by a previous decision to submit their observations on possible violation
of the decision in question due to use of that aid in a manner contrary to that decision and those beneficiaries did not take
advantage of that opportunity, the Commission did not violate any of their rights (*Falck and Acciaierie di Bolzano* v *Commission*, paragraph 84, and*Fleuren Compost* v *Commission*, paragraph 47). Moreover, the Commission cannot be held liable for the alleged failure by the Member State concerned or,
as claimed by the applicant in Case T‐111/01, by the Lintra holding company to inform it of the initiation of the formal investigation
procedure.

54     This finding is not affected by the allegation of the applicant in Case T‐133/01 that the liquidation procedure pertaining
to it had not yet occurred at the time the procedure provided for in Article 88(2) EC was opened. As rightly pointed out by
the Commission, it is clear from the application initiating proceedings that the receiver acts only in that capacity and not
on his own behalf. Moreover, as discussed in paragraph 49 above, at the time of publication of the decision to open the formal
investigation procedure, the company ZEMAG, explicitly referred to in that decision, had sufficient time at its disposal to
respond to the invitation to submit observations.

55     Likewise, the Court cannot accept the arguments of the applicant in Case T‐111/01 that it was not concerned by the decision
to open the formal procedure and was unaware of the risk of having to repay the aid. In the first place, since the applicant
is referred to explicitly several times in the decision and the Commission expressed at the very least doubts whether all
of the aid that it had authorised for the restructuring of the Lintra subsidiaries in the decision of 13 March 1996 had been
used correctly, the applicant in Case T‐111/01 was necessarily concerned by that decision. The Commission cannot be criticised
for the fact that the applicant chose not to submit observations following the invitation made by the notice from the Commission
referred to in paragraph 49 above.

56     In the second place, as stated in paragraph 52 above, the decision to open the formal investigation procedure stated in a
sufficiently clear manner that the aid to which it referred would, if appropriate, be recovered from the beneficiary thereof,
in accordance with Article 14 of Regulation No 659/1999. Accordingly, once the decision to open the formal procedure had been
published, the applicant in Case T‐111/01 could not be unaware of the risk of having to repay the aid in question. Consequently,
it also could not rely on an alleged legitimate expectation that the aid in question was compatible with the common market,
an allegation which is moreover contradicted by the applicant itself when it alleges that it was not informed of the decision
of 13 March 1996.

57     Second, the applicants’ argument that, following the failure by the Federal Republic of Germany to respond to the information
injunction decision of 1 August 2000 to provide certain information, they should have been questioned directly by the Commission
before the Commission adopted the contested decision must likewise be rejected.

58     Even if the Federal Republic of Germany did actually fail to comply with the aforementioned information injunction decision,
it follows from Article 13(1) of Regulation No 659/1999 that, in such a situation, the Commission is empowered to end the
formal investigation procedure and to adopt a decision declaring that the aid is or is not compatible with the common market
on the basis of the information available. That decision may, subject to the conditions provided for in Article 14 of Regulation
No 659/1999, order the recovery of previously-paid aid from its beneficiary. Under Article 16 of Regulation No 659/1999, Articles
13 and 14 apply mutatis mutandis in the event of misuse of aid. Consequently, it follows from those provisions that, contrary
to what the applicants allege, the Commission is not under a duty to consult the parties concerned in cases where a Member
State fails to comply with the Commission’s injunction to provide information.

59     The Court also notes that, in the present case, the applicants do not state that, acting pursuant to Article 20(3) of Regulation
No 659/1999, they asked for a copy of the decision ordering the Federal Republic of Germany to provide information, or even
that, despite the request from the Commission to the Federal Republic of Germany in the information injunction decision of
1 August 2000 to forward that invitation to all potential recipients of the aid in question, they provided the Commission
with information which the latter did not take into consideration before adopting the contested decision.

60     Lastly, the applicant in Case T‐111/01 criticises the Commission for not having carried out on-site checks, as required by
Regulation No 659/1999.

61     That complaint, which does not concern the rights which parties concerned have in the procedure provided for by Article 88(2)
EC, but rather the scope of the investigations undertaken by the Commission in its assessment of State aid, will be examined
in paragraphs 98 to 100 below, as part of the plea alleging error in finding that there had been misuse of the aid authorised
by the decision of 13 March 1996.

62     In those circumstances, it follows that the common plea alleging violation of the applicants’ rights in the procedure provided
for by Article 88(2) EC cannot be accepted.

*The plea relating to factual errors in the contested decision (Case T‐133/01)*

Arguments of the parties

63     The applicant in Case T‐133/01 criticises the Commission for having adopted the contested decision on the basis of four erroneous
pieces of information. First, contrary to what is stated in recital 39 of the contested decision, the investments made by
the company ZEMAG between 1994 and 1997 were not lower than what was initially planned. Second, the applicant received a lower
amount (DEM 44 977 000) than that relied on by the Commission in recital 40 of the contested decision (DEM 65 617 000). Third,
as to the aid referred to in the recovery order, it did not receive a liquidity loan but rather liquidity aid. Lastly, in
the reply, the applicant challenges the Commission’s statements relating, first, to the failure to adapt the production programme
of the Lintra subsidiaries to market conditions and, second, to the qualifications and professional skills of the managers
of the Lintra holding company.

64     The Commission considers that the first three allegations of error of fact cannot be accepted. In the Commission’s view, the
findings in the contested decision are based on the information provided by the German authorities in response to the information
injunction decision of 1 August 2000. According to the Commission, since the applicant did not participate in the administrative
procedure, it waived its right to invoke any factual inaccuracies. The Commission also states that, by virtue of the case-law
of the Court of Justice and the provisions of Regulation No 659/1999, the Commission is empowered to end the procedure and
to take a decision on the basis of the particulars in its possession when a Member State, despite the Commission’s injunction,
fails to provide the information requested. Even if the Commission had committed the errors alleged by the applicant, that
would not, in its view, affect the accuracy of the contested decision, which states that the aid was used essentially in accordance
with the approved restructuring plan. As to the disputed aid, the recovery of that aid was ordered not because of the unlawful
use thereof by the subsidiaries, but because, first, it was kept by the Lintra holding company and, second, because liquidity
loans were granted after the manifest failure of the first restructuring.

65     As to the fourth error of fact relied on by the applicant, the Commission maintains that, since it was put forward for the
first time at the stage of the reply and does not support any legal argument such as to establish the unlawfulness of the
contested decision, it is inadmissible. In the Commission’s view, the content of the allegations is in any event unfounded,
because the Commission ascertained the veracity of the information in question with the German authorities.

Findings of the Court

66     The Commission states essentially that the applicant in Case T‐133/01 may not put forward the factual arguments referred to
in paragraph 63 above because it did not rely on them in the investigation procedure relating to the disputed aid. It considers,
moreover, that the fourth alleged error of fact is inadmissible because it was put forward late, that is, only at the stage
of the reply.

67     According to settled case-law, in the context of an action for annulment under Article 230 EC the legality of a Community
measure falls to be assessed on the basis of the elements of fact and of law existing at the time when the measure was adopted.
In particular, the assessments made by the Commission must be examined solely on the basis of the information available to
the Commission at the time when those assessments were made (*British Airways and Others* v *Commission*, paragraph 81; Case T‐110/97 *Kneissl Dachstein* v *Commission*[1999] ECR II‐2881, paragraph 47; and Case T‐123/97 *Salomon* v *Commission* [1999] ECR II‐2925, paragraph 48).

68     It follows that an applicant who has participated in the investigation procedure provided for by Article 88(2) EC cannot rely
on factual arguments of which the Commission was unaware and of which it did not inform the Commission in the course of the
investigation procedure. By contrast, nothing prevents the party concerned from formulating against the final decision a legal
plea which was not raised at the stage of the administrative procedure (see, to that effect, *Kneissl Dachstein* v *Commission*, paragraph 102, and *Salomon* v *Commission*, paragraph 55).

69     That case-law does not necessarily apply by extension to all cases where an undertaking has not participated in the investigation
procedure provided for by Article 88(2) EC. Although that case-law may be held to be inapplicable to certain exceptional cases,
the Court finds that it applies to the present case.

70     It should be borne in mind that the applicant did not exercise its right to participate in the investigation procedure, even
though it is common ground that it was referred to specifically several times in the decision to open the investigation procedure,
particularly in the title and in points 2.1 and 2.4 of that decision, and that doubts were expressed in that decision as to
the correct use of all of the aid intended for the restructuring of the Lintra subsidiaries having regard to the decision
of 13 March 1996. It is equally common ground that the facts relied on by the Commission in recitals 39 and 40 of the contested
decision are based on information provided by the German authorities in the investigation procedure. In those circumstances,
the applicant’s arguments relating to the amount of investments and the amount of aid received are factual arguments of which
the Commission was unaware at the time it adopted the contested decision and which therefore cannot be raised for the first
time before the Court of First Instance as a means of contesting that decision.

71     The same holds true for the alleged errors of fact committed by the Commission concerning the failure to adapt the production
programme of the Lintra group subsidiaries to the conditions of the market and to the qualifications and professional skills
of the managers of the Lintra holding company, referred to in recital 16 of the contested decision, without its being necessary
to examine the objection raised by the Commission as to the tardiness of those arguments elaborated in the reply. In any event,
the Court finds that, even if there were factual errors, those statements, which were of a general nature, are irrelevant
to the choice made by the Commission in the contested decision.

72     Lastly, as to the legal – and not purely factual – issue of whether the ZEMAG company obtained liquidity aid instead of liquidity
loans following the failure of the first restructuring plan, as indicated in the contested decision, the applicant, when questioned
specifically by the Court on this point, merely stated that that distinction arose merely from a difference in the terms used
by the Lintra holding company, but was unable to clarify what consequences that classification could have on the recovery
of the disputed aid. It follows that that argument is irrelevant.

73     Consequently, the plea alleging errors of fact in the contested decision cannot be accepted.

*The plea alleging errors in the finding of misuse of aid authorised by the Commission’s decision of 13 March 1996 (Case T‐111/01)*

Arguments of the parties

74     First, the applicant in Case T‐111/01 states that the aid paid to it until 1996 was used in accordance with the decision of
13 March 1996, as is apparent from the documents forwarded to the German authorities by the BvS. Although the contested decision
does not give a breakdown of the amount of DEM 3 195 559 which the applicant has been ordered to repay as a share of the partial
amount of DEM 22 978 000, which in itself, in the applicant’s view, constitutes an illegality, the breakdown of the payments
made shows that they were in accordance with the restructuring plan and had been authorised by the decision of 13 March 1996.

75     Thus, contrary to what the Commission states in the contested decision, the applicant maintains that the partial amount of
DEM 22 978 000 was not used to pay for certain management services provided by the Lintra holding company, but solely to finance
restructuring measures. The applicant states in that respect that the German Government, in its correspondence to the Commission
dated 2 October 2000, stated that the services provided by the Lintra holding company to the subsidiaries were intended to
ensure the restructuring of those subsidiaries, without which the restructuring would not have been possible. Moreover, even
if the aid had been used to pay for services provided by the Lintra holding company, which it does not agree is the case,
the applicant submits that that would not constitute misuse. The applicant points out that the Commission was aware of the
group structure chosen by the German authorities, in particular the fact that Lintra was a mere holding company, the services
of which were billed to its subsidiaries using an internal apportionment formula. Since the Commission signalled its agreement
for the use of the aid to pay for services provided by the Lintra holding company, that aid should be considered as covered
by the decision of 13 March 1996.

76     Second, the applicant complains that the contested decision was based solely on assumptions as to the alleged misuse of the
aid, assumptions which themselves are based on vague statements obtained from the German authorities. Referring to recital
42 of the contested decision, the applicant states that the Commission relies on the Federal Republic of Germany’s statement
that it could not exclude the possibility that the aid was used to pay for services provided by the Lintra holding company.
In the applicant’s view, it was necessary to demonstrate that that aid was actually used to pay for those services.

77     The Commission states, first, that the use of aid by the Lintra holding company was not provided for in the decision of 13
March 1996. Nor could this have been the case, since that company was not an undertaking in difficulty. The same holds true
for the use of the aid by the Lintra subsidiaries to pay for services provided by the Lintra holding company. The Commission
points out that, first, since the amount of DEM 22 978 000 remained in the accounts of the Lintra holding company and the
German authorities were unable to provide specific information as to how it was used and, second, since the subsidiaries were
responsible for the correct use of that amount, the entire sum should have been recovered from the Lintra holding company
and its subsidiaries. The fact that the Commission was aware of the nature of the Lintra holding company does not mean that
services provided by that company could be paid for using State aid which had been authorised to restructure the subsidiaries.

78     Second, the Commission submits that the applicant contradicted itself several times in relation to the management services
provided by the Lintra holding company. The applicant has stated that the services provided by the Lintra holding company
to its subsidiaries were necessary for their restructuring and that they should therefore be considered as aid covered by
the decision of 13 March 1996. However, although the applicant received those services using State subsidies, that is, free
of charge, it none the less states that it paid for those services using the aid granted. In the Commission’s view, it follows
that the applicant cannot seriously maintain that it obtained for consideration the aid which it is now being asked to repay.
The Commission submits that, in any event, the aid must be recovered because it cannot be established with certainty that
it was used in accordance with the decision of 13 March 1996. The reason for the recovery is therefore not the abstract group
structure, but rather the fact that, pursuant to the decision of 13 March 1996, the Lintra subsidiaries were the beneficiaries
of the aid.

79     Lastly, regarding the assumptions alleged by the applicant, the Commission replies that it did not rely on such suppositions.
The contested decision merely had the effect of finding that the German authorities could not exclude the possibility that
the subsidiaries had actually used the aid to pay for services provided by the Lintra holding company. The Commission adds
that, in the event that the aid was spent by the Lintra holding company, it must be recovered from the subsidiaries which
received management services from the holding company. If the applicant had evidence that it had not received such services
free of charge, it should have provided that evidence to the Commission during the administrative procedure, in response to
the Commission’s invitation to submit observations.

Findings of the Court

80     The applicant in Case T‐111/01 essentially denies that the partial amount of aid of DEM 22 978 000, on the basis of which
the amount of DEM 3 195 559 the repayment of which is claimed from it by the contested decision was calculated, was misused.
In its view, that aid was used for its restructuring in accordance with the decision of 13 March 1996.

81     The Court finds that this plea must be examined in two stages. First, it is necessary to ascertain the precise scope of the
decision of 13 March 1996. Next, in the light of that examination, the Court will ascertain whether the Commission, in the
contested decision, could make a finding of misuse within the meaning of Article 88(2) EC of the amount of the aid on the
basis of which the amount to be repaid by the applicant in Case T‐111/01 was calculated.

–       The scope of the decision of 13 March 1996

82     In the decision of 13 March 1996, the Commission first examined the economic and social aspects of the individual situations
of the eight subsidiaries managed by the Lintra holding company, including the applicant in Case T‐111/01, and their presumed
viability having regard to the restructuring planned by the German authorities. It also stated that, following a tendering
procedure launched with a view to the restructuring and privatisation of the undertakings, the acquisition offer made by Emans
& Partners GbR for all of the undertakings was the one accepted by the German authorities, since that offer was considered
to be the best one, particularly in terms of maintenance of employment, the investment plan, the personal commitment of the
purchaser, the financial obligation to the Treuhandanstalt and the prospects for each of the undertakings. Consequently, the
Treuhandanstalt (subsequently the BvS) transferred to the purchasers 100% of the shares in the undertakings held by the Lintra
holding company. The Commission then gave a breakdown of the financial measures planned by the German authorities for the
restructuring and privatisation in due course of the undertakings in the Lintra group, including aid in the amount of DEM
970 200 000, subsequently reduced to DEM 824 200 000. In its analysis of the compatibility of the aid, the Commission stated
that ‘despite the tendering procedure, it was not possible to find an investor willing to take on the economic risk of restructuring
the undertakings in question without State aid’ and that ‘because the undertakings were sold to the highest bidder, the State
aid provided for in the privatisation contract was limited to what was strictly necessary, in order to give the undertakings
the opportunity to re-establish their long-term competitiveness’. It stated that ‘the undertakings as a whole are involved
in growing markets where there is no structural overcapacity’ and that ‘the financial aid was limited in time’. The Commission
inferred therefrom that ‘the aid complies with the conditions imposed for restructuring (competitivity, proportionality, reduction
of capacity)’.

83     The Commission concluded at the end of its assessment, first, that ‘if one considers together all of the restructuring aid,
[its] view is that that aid is compatible with the common market within the meaning of Article 92(3)(c) of the Treaty ... because
it is limited to what is strictly necessary and does not confer any advantage on the undertakings in relation to competitors’.
Second, the Commission also found that ‘because the undertakings are all established in a region coming within the exception
provided for by Article 92(3)(a) of the Treaty ..., in the light of the number and the size of the undertakings aided, because
their range of products is varied and it is therefore not possible to obtain a synergy effect, and given the relatively low
amount of the aid, the aid in question is declared compatible with the common market within the meaning of Article 92(3)(a)
of the Treaty’.

84     A reading of the decision of 13 March 1996 shows that the beneficiaries of the authorised aid were the eight Lintra subsidiaries,
including the applicant in Case T‐111/01, whose economic and social situation and viability were described specifically in
pages 1 to 5 of the decision, although not that of the Lintra holding company, whose functions consisted of ensuring the management
of the group with a view to enabling the restructuring and privatisation of the subsidiaries as soon as possible. Although
the financial measures envisaged by the German authorities were intended for the recapitalisation of the companies and the
financing of the restructuring measures, particularly through the participation of the BvS in the losses, investment aid and
the covering of the liquidity needs of the companies, the decision of 13 March 1996 did not authorise the aid to be used by
the Lintra holding company in order to finance its own activities. Moreover, the fact that that aid may have been paid by
the German authorities to the Lintra holding company as part of the management activities of the Lintra group does not prevent
the subsidiaries of that group from being considered as deriving a benefit therefrom (see, to that effect, Joined Cases 172/83
and 226/83 *Hoogovens Groep* v *Commission*[1985] ECR 2831, paragraph 34) and being, in reality, the beneficiaries of the aid authorised by the decision of 13 March
1996. It follows that, in its decision of 13 March 1996, the Commission authorised only the aid intended for the restructuring
of the Lintra subsidiaries, including the applicant in Case T‐111/01.

–       The finding of misuse of the amount of aid which the applicant in Case T‐111/01 is being asked to repay

85     The Court notes, as a preliminary point, that under Article 88(2) EC, if the Commission finds that aid is being misused, it
is to decide that the State concerned must abolish or alter it within the period of time determined by it.

86     A reading of Article 88(2) EC together with Article 1(g) and Article 16 of Regulation No 659/1999 shows that it is in principle
for the Commission to establish that all or part of the aid previously authorised by it by an earlier decision has been misused
by the beneficiary. If it fails to do so, that aid is to be considered as being covered by its previous approval decision.
Nevertheless, the reference in Article 16 of Regulation No 659/1999 to Article 13 authorises the Commission, in cases where
a Member State fails to comply with an order to provide information, to adopt a decision closing the formal investigation
procedure on the basis of the information available. Thus, when a Member State fails to provide sufficiently clear and precise
information on the use of the aid about which the Commission, on the basis of the information it has available, expresses
doubts as to compliance with its earlier approval decision, the Commission is empowered to find that the aid in question has
been abused.

87     Moreover, it should be borne in mind that, in the present case, the Commission stated in recital 42 of the contested decision
that:

‘In so far as aid granted to the Lintra group was not used for the purposes envisaged under the approved restructuring plan,
it falls outside the scope of the decision of 13 March 1996. It follows from that decision that all aid should have been used
directly for the purpose of restructuring the Lintra subsidiaries. Neither the notified restructuring plan nor the decision
explicitly provides for any use of aid in [the] Lintra [holding company], which, moreover, would not even have been eligible
for restructuring aid as it was not a company in difficulty. Nor was any use of aid by the subsidiaries for the purpose of
purchasing services from [the] Lintra [holding company] expressly provided for in the restructuring plan or the decision of
13 March 1996. Germany has confirmed that it cannot rule out that aid may in fact have been used by the subsidiaries to pay
for services provided by that company. In addition, in reply to the information request Germany provided only a very rough
set of figures on the overall expenses of [the] Lintra [holding company] (personnel costs, legal costs, office rents, etc.)
without demonstrating exactly what services the company provided at what time to which subsidiaries in return for payment.
As Germany has been unable to provide enough evidence in this respect, the Commission must consider that the amount of DEM
34 978 000 which remained within [the] Lintra [holding company] is not covered by its decision of 13 March 1996.’

88     From that it concluded, in recital 43 of the contested decision, that:

‘The part of the aid granted that remained in [the] Lintra [holding company], namely DEM 34 978 000, has not been used in
accordance with the provisions of the approved restructuring plan. It was therefore used by the recipient in contravention
of the decision of 13 March 1996 and constitutes misuse of aid within the meaning of Article 88(2) of the EC Treaty, read
in conjunction with Article 1(g) of Regulation (EC) No 659/1999. ...’

89     Regarding the partial amount of DEM 22 978 000, the Commission found in recital 44 of the contested decision that ‘Germany
was unable, in its answer to the request for information, to give a detailed account’ of the use thereof. It also stated in
recital 45 of the contested decision that ‘Germany has not proved that the amount was passed on to the subsidiaries’, and
went on to state that ‘on the basis of the information provided by Germany, [the] Lintra [holding company] has undoubtedly
received the whole aid amount’. Consequently, the Commission asked that the entire sum be recovered from the Lintra holding
company and its subsidiaries, in the manner described in recital 46 of the contested decision. According to that recital,
the Federal Republic of Germany is required to demand reimbursement of the amount of DEM 3 195 559 from the applicant in Case
T‐111/01.

90     In the light of the aforementioned recitals of the contested decision and on the basis of the evidence in the file, it is
common ground that the partial aid amount of DEM 22 978 000 remained in the accounts of the Lintra holding company. It is
equally common ground that, as part of its management activities within the Lintra group, the Lintra holding company provided
various services for the Lintra subsidiaries. The point in dispute in the present plea, however, is whether the Commission
was able to find that the amount of DEM 22 978 000 had been misused, despite the fact that it was not able to determine the
actual use of that amount, given the lack of detailed evidence provided by the German authorities following the information
injunction decision of 1 August 2000.

91     It should be borne in mind that the assessment which the Commission must conduct involves the consideration and assessment
of economically complex facts and circumstances. Since the Community Court may not substitute its assessment of economically
complex facts and circumstances for that of the Commission, the Court’s review must be limited to verifying compliance with
procedural rules and the obligation to state reasons, as well as the material accuracy of the facts, and ensuring that there
has been no manifest error of assessment or misuse of powers (Case 138/79 *Roquette Frères* v *Council*[1980] ECR 3333, paragraph 25; Case C‐225/91 *Matra* v *Commission*[1993] ECR I‐3203, paragraph 25; Case T‐17/93 *Matra Hachette* v *Commission*[1994] ECR II‐595, paragraph 104; Case T‐9/93 *Schöller* v*Commission*[1995] ECR II‐1611, paragraph 140; *Skibsværftsforeningen and Others* v *Commission*, paragraph 170; and Case T‐243/94 *British Steel* v *Commission*[1997] ECR II‐1887, paragraph 113).

92     In the present case, the Commission’s finding that the amount of DEM 22 978 000 was misused is not vitiated by a manifest
error of assessment.

93     The Commission cannot be criticised for having adopted the contested decision in spite of the fact that it was not in a position
to determine the actual use of the amount in question. In the light of paragraph 86 above, although in principle it is for
the Commission to establish that aid previously authorised by it was misused, it nevertheless remains for the Member State
to provide all the information requested by the Commission following an information injunction, failing which the Commission
is empowered to adopt its decision closing the formal investigation procedure on the basis of the information available.

94     It is, moreover, apparent from the evidence in the file that the German authorities, despite being instructed by the Commission
to provide ‘all information for determining how the expenses of the Lintra holding company were apportioned amongst the subsidiaries’,
‘all information relating to other possible allocations of the amount [DEM 22 978 000] remaining in the holding company to
the subsidiaries, that is, specific information concerning the turnover and the total aid obtained by the subsidiaries during
the first restructuring phase (1994-1996)’, as well as ‘all information necessary in order to determine to what extent the
group fees paid by the subsidiaries were financed by aid’, did not provide the necessary information. In their letter of 2
October 2000 in response to the information injunction decision of 1 August 2000, the German authorities merely gave overall
figures as to the allocation of the amount of DEM 22 978 000, which had remained in the accounts of the Lintra holding company,
to various services provided by that company, without giving specific information on the exact apportionment of that amount
amongst the subsidiaries.

95     In those circumstances, the fact that the amount of DEM 22 978 000 was in the accounts of the Lintra holding company could
be interpreted by the Commission in only one of two ways: either the Lintra holding company, to which the BvS was paying the
restructuring aid for the subsidiaries, had not passed on the amount of DEM 22 978 000 to the subsidiaries, in which case
there was a violation of the decision of 13 March 1996 authorising the payment of restructuring aid in favour of the Lintra
subsidiaries; or the subsidiaries had paid the Lintra holding company for services which, although they may have been provided
for the purpose of restructuring the subsidiaries, had not been the subject of any specific evidence provided by the German
authorities as to their nature, purpose and date of payment, which could then lead the Commission to consider, as it stated
in recital 45 of the contested decision, that the amount of DEM 22 978 000 had not been passed on to the subsidiaries, which
was also in violation of the decision of 13 March 1996.

96     It is true that under Regulation No 659/1999 aid cannot be considered to have been misused unless that practice may be attributed
to the beneficiary thereof.

97     A combined reading of recitals 43 and 44 of the contested decision shows that the Commission considered that the beneficiary
to which the misuse of the amount of DEM 22 978 000 was to be attributed was the Lintra group as a whole, as initial beneficiary
of the aid approved by the decision of 13 March 1996. Moreover, as found in paragraph 84 above, the initial beneficiaries
of the aid approved by the decision of 13 March 1996 could only be the Lintra subsidiaries and not the group as a whole. However,
since the amount of DEM 22 978 000 remained in the accounts of the Lintra holding company, the Commission, in the light of
the information in its possession at the time of adoption of the contested decision, could rightly consider that that aid
had not been used in accordance with the decision of 13 March 1996.

98     Lastly, contrary to what the applicant maintains, the Commission was also not required to conduct on-site checks pursuant
to Article 22(1) of Regulation No 659/1999 before being able to adopt the contested decision.

99     It should be borne in mind that, under that provision, ‘where the Commission has serious doubts as to whether decisions not
to raise objections, positive decisions or conditional decisions with regard to individual aid are being complied with, the
Member State concerned, after having been given the opportunity to submit its comments, shall allow the Commission to undertake
on-site monitoring visits’. Article 22(1) of Regulation No 659/1999 must be read in the light of recital 20, according to
which ‘on-site monitoring visits are an appropriate and useful instrument, in particular for cases where aid might have been
misused’.

100   In the present case, the Court finds that in the response of the German authorities of 2 October 2000 to the information injunction
decision of 1 August 2000, the Commission, faced with the two possibilities discussed in paragraph 95 above, could no longer
have serious doubts as to non-compliance with the decision of 13 March 1996 as regards the use of the amount of DEM 22 978 000 .
In those circumstances, it was not under any alleged obligation to carry out an on-site monitoring visit in order to ascertain
whether the decision of 13 March 1996 was being complied with.

101   For all of the foregoing reasons, the plea alleging error in the finding that there had been misuse of aid authorised by the
Commission’s decision of 13 March 1996 cannot be accepted.

*The common plea alleging error by the Commission in the determination of the beneficiary of the disputed aid*

Arguments of the parties

–       In Case T‐111/01

102   The applicant in Case T‐111/01 states that the aid authorised by the Commission’s decision of 13 March 1996 was paid directly
by the Federal Republic of Germany to the Lintra holding company. The applicant, like all of the Lintra subsidiaries, therefore
received the aid only indirectly. According to the applicant, this is confirmed by the Commission itself. In its information
injunction decision of 1 August 2000 addressed to the German authorities, the Commission recognised that, according to the
information available, there was no reason to consider that the amount of DEM 34 978 000 had been paid to the subsidiaries.
In the applicant’s view, it follows that only the Lintra holding company may be ordered to repay the disputed aid. The applicant
invites the Court to consider whether the sole shareholder of Lintra between 1994 and 1997, as well as the BvS and the Federal
Republic of Germany itself, should not be required to repay the aid.

103   The applicant also challenges the attribution of joint and several liability to the Lintra holding company and its subsidiaries
in the contested decision. Such joint and several liability has no legal basis and is tantamount to allowing ‘reverse group
liability’, under which a subsidiary is liable for the debts of the parent company. The applicant submits that such a concept
does not exist either in German law or, to the best of its knowledge, in Community law. Moreover, such joint and several liability
was accepted by the Commission only on grounds of convenience relating to the insolvency of the Lintra holding company.

104   The Commission replies that the decision of 13 March 1996 designated the Lintra subsidiaries as being the beneficiaries of
the approved aid. It follows, in the Commission’s view, that those subsidiaries are jointly responsible for the correct use
of the aid. It is therefore not arbitrary on the part of the Commission to order that the misused aid be recovered from them
as well if it is not possible to recover from the Lintra holding company. The Commission explains that, in the present case,
since the German authorities were not able to provide reliable information on the end-use of the aid granted, joint and several
liability of all the subsidiaries seemed to be the only possible solution.

105   According to the Commission, the applicant is not therefore being held liable for the obligations of the parent company by
virtue of ‘reverse group liability’, but rather because of its own obligation which it has in its capacity as beneficiary
of aid. In the Commission’s view, the only reason why the contested decision provides for joint and several liability is that,
because it was aware of the structure of the group and their plans to channel the aid through the Lintra holding company,
the Commission could not exclude the possibility that aid might end up partly in the accounts of the Lintra holding company.
The Commission adds that, in any event, it does not matter that the legal situation described in the statement in defence
is ‘foreign to German law’, since Community law does not fall to be assessed in the light of national law. The Commission
adds that the applicant’s invitation to the Court to consider whether the repayment of the disputed aid by the Federal Republic
of Germany or by the BvS was necessary makes no sense and that the issue of whether the sole shareholder of the Lintra holding
company should be required to repay the aid is a matter falling within the scope of national law.

–       In Case T‐133/01

106   The applicant in Case T‐133/01 maintains that the Commission misused its powers of assessment in requiring the recovery of
aid from it. In the applicant’s view, only the Lintra holding company received aid. Moreover, by the decision of 13 March
1996, the Commission gave its agreement for aid intended for restructuring measures in the context of the privatisation of
the Lintra holding company. In those circumstances, the applicant challenges the attribution of joint and several liability
to the Lintra holding company and its subsidiaries in a contested decision as regards the partial amount of DEM 22 978 000,
as well as its partial liability (in the amount of DEM 4 077 000) for the repayment of the aid in the form of liquidity loans.
The applicant states that there can be no question of repaying, even partially, the amount of DEM 4 077 000 determined in
the contested decision, and in any event it does not know how that amount was determined by the Commission.

107   The Commission states first that, according to the decision of 13 March 1996, the beneficiaries of the aid granted were the
eight Lintra subsidiaries. It is in that capacity that they are responsible for the correct use of the aid.

108   It states next that it is for the Commission, when it finds that State aid is incompatible with the common market, to order
that it be repaid. The Commission has no margin of discretion in that connection, as laid down in Article 14 of Regulation
No 659/1999. The objective of re-establishing the earlier situation, which is the reason for the obligation of the State to
cancel aid, is achieved when the aid, including, where applicable, default interest, has been repaid by the beneficiary.

109   Regarding the partial amount of DEM 12 000 000, the Commission submits that that amount did not come within the scope of the
decision of 13 March 1996 and should therefore be repaid. The Commission states that the aid authorised by the decision of
13 March 1996 was intended for the group made up of the subsidiaries with a view to joint restructuring and privatisation.
The Commission adds that the amount of DEM 12 000 000 was paid in April and June 1997, following the failure of the first
restructuring and at a time when the group was virtually in a situation of being re-nationalised, since the BvS had reassumed
control of the group. In those circumstances, the Commission submits that it is obvious that the amount of DEM 12 000 000
could not be covered by the decision of 13 March 1996 and that the instructions to repay the aid were fully justified.

110   Lastly, regarding the issue of joint and several liability, the Commission states that that issue was referred to in the contested
decision only because the Commission could not exclude the possibility that part of the aid might be in the accounts of the
Lintra holding company. The Commission states that, contrary to what the applicant alleges, the applicant is not being held
liable for the debts of the Lintra holding company. On the contrary, it is the Lintra holding company which is being held
as a joint and several debtor for the debts of the subsidiaries.

Findings of the Court

111   As a preliminary observation, it should be pointed out that, in accordance with Community law, when the Commission finds that
aid is incompatible with the common market, it may require the Member State to recover that aid from the recipient (Case 70/72
*Commission* v *Germany* [1973] ECR 813, paragraph 20; Joined Cases C‐328/99 and C‐399/00 *Italy and SIM 2 Multimedia* v *Commission* [2003] ECR I‐4035, paragraph 65; and Case C‐277/00 *Germany* v *Commission*[2004] ECR I‐3925, paragraph 73).

112   Removing unlawful aid by means of recovery is the logical consequence of a finding that it is unlawful and seeks to re-establish
the previous situation (*Germany* v *Commission*, paragraph 74).

113   That purpose is achieved once the aid in question, together where appropriate with default interest, has been repaid by the
recipient or, in other words, by the undertakings which actually benefited from it. By repaying the aid, the recipient forfeits
the advantage which it had enjoyed over its competitors on the market, and the situation prior to payment of the aid is restored
(see, to that effect, Case C‐350/93 *Commission* v *Italy*[1995] ECR I‐699, paragraph 22; Case C‐457/00 *Belgium* v *Commission*[2003] ECR I‐6931, paragraph 55; and *Germany* v *Commission*, paragraph 75).

114   Consequently, the main purpose of the repayment of unlawfully paid State aid is to eliminate the distortion of competition
caused by the competitive advantage afforded by the unlawful aid (*Germany* v *Commission*, paragraph76).

115   It cannot in principle be otherwise as regards the repayment of aid paid by the State which, pursuant to a decision adopted
by the Commission, is considered to have been misused pursuant to Article 88(2) EC and Article 1(g) of Regulation No 659/1999.
The Court notes in this respect that Article 16 of Regulation No 659/1999 provides inter alia that Article 14 of the same
regulation, in so far as it requires recovery from the beneficiary of aid found to be illegal, applies mutatis mutandis in
the event of aid being misused. Consequently, misused aid must, in principle, be recovered from the undertaking which has
had the actual use thereof, in order to eliminate the distortion of competition caused by the competitive advantage afforded
by that aid.

116   It is in the light of those considerations that it is appropriate to consider the lawfulness of the order to recover the disputed
aid contained in Article 3 of the contested decision. The Court will assess, first, the lawfulness of the recovery order concerning
the partial aid amount of DEM 22 978 000 addressed to both the company Saxonia Edelmetalle, for the amount of DEM 3 195 559,
and the company ZEMAG, for the amount of DEM 2 419 271. Second, the Court will examine the repayment order for the amount
of DEM 12 000 000 addressed to the company ZEMAG for the amount of DEM 4 077 000.

–       The order to recover disputed aid as regards the partial aid amount of DEM 22 978 000 contained in Article 3 of the contested
decision (Cases T‐111/01 and T‐133/01)

117   The Court notes as a preliminary point that, as found in the consideration of the previous plea put forward by the applicant
in Case T‐111/01, the Commission did not make a manifest error of assessment in finding that the partial aid amount of DEM
22 978 000 had been misused. Moreover, the applicant in Case T‐133/01 has not seriously contested the Commission’s findings
regarding the misuse of that amount in so far as it is concerned.

118   Next, the Court recalls that the Commission found, first, in recital 44 of the contested decision, that:

‘Since the aid was originally granted to the Lintra group as a whole and since that group no longer exists, the Commission
is not required to examine to what extent the individual companies within the group benefited from the aid. The repayment
obligation should accordingly be imposed on all the companies which belonged to the group at the time the aid was granted.’

119   Next, the Commission stated in recital 45 of the contested decision:

‘On the basis of the information provided by Germany, [the] Lintra [holding company] undoubtedly received the whole aid amount.
As regards the DEM 22 978 000, Germany has not proved that the amount was passed on to the subsidiaries. Under these circumstances
the whole amount must be recovered from [the] Lintra [holding company] and the subsidiaries.’

120   The Commission then stated how the amount of DEM 22 978 000 was to be recovered from the Lintra subsidiaries, according to
an apportionment formula based on the level of aid that those undertakings had received and which were declared, by the contested
decision, as having been used in accordance with the decision of 13 March 1996.

121   In the contested decision, the Commission therefore found that, in the absence of information to the contrary from the German
authorities, the amount of DEM 22 978 000 which had remained in the accounts of the Lintra holding company had not been passed
on to the subsidiaries. In its written pleadings, as highlighted in paragraph 64 above, the Commission also acknowledged that
the recovery of the amount DEM 22 978 000 from the applicants had been required not because of the unlawful use of that aid
by the subsidiaries, but rather because it had been kept by the Lintra holding company.

122   In those circumstances, the Court finds that the Commission could not require the Federal Republic of Germany to recover from
the applicants the amounts indicated in the second table in Article 3 of the contested decision since, according to the contested
decision itself and the Commission’s own written pleadings, those undertakings were not beneficiaries of the amount of DEM
22 978 000, since they had not had actual use of that amount which had been misused.

123   This finding is not affected by the statement in recital 44 of the contested decision to the effect that it was to the Lintra
group as a whole that the aid had initially been granted by virtue of the decision of 13 March 1996 and that, consequently,
the Commission was not required to ascertain to what extent the different undertakings in the group had been able to benefit
from that aid. Suffice it to note that, as stated in paragraph 84 above, although the Lintra group, through the Lintra holding
company, received the aid paid by the BvS, the initial beneficiary of all of the aid was not the Lintra group, composed of
the subsidiaries and the Lintra holding company, but could only be the subsidiaries for the purpose of their restructuring
and their privatisation. Moreover, the Court notes that the Commission, particularly by stating in recital 42 of the contested
decision that the Lintra holding company could never have used the aid because it was not a company in difficulty, acknowledged
that it was not just the group as such which was to be the initial beneficiary of the aid approved by the decision of 13 March
1996. In those circumstances, the premiss on which the Commission relied in order to find that it was not required to ascertain
to what extent the different undertakings in the group had been able to benefit from the amount of DEM 22 978 000 is mistaken.

124   However, in the light of the circumstances of the present case, the Commission was not required to determine in the contested
decision to what extent each undertaking had benefited from the amount of DEM 22 978 000, but could merely instruct the German
authorities to recover that aid from the beneficiary or beneficiaries thereof, that is, from the undertaking or undertakings
which had had actual use thereof. It was thus for the Federal Republic of Germany, pursuant to its Community obligations,
to proceed to recover the amount in question. If a Member State encounters unforeseen difficulties in implementing an order
for recovery, it can submit those problems for consideration by the Commission. In such a case the Commission and the Member
State concerned must, in accordance with the duty of genuine cooperation, as expressed inter alia in Article 10 EC, work together
in good faith with a view to overcoming the difficulties whilst fully observing the Treaty provisions, in particular the provisions
on aid (see inter alia Case C‐303/88 *Italy* v *Commission*[1991] ECR I‐1433, paragraph 58, and Case C‐382/99 *Netherlands* v *Commission*[2002] ECR I‐5163, paragraph 50).

125   By contrast, in the absence of more specific information and given that the amount of aid was in the accounts of the Lintra
holding company, the Commission is not entitled to impose automatically the obligation to repay the disputed aid on the applicants
on the sole ground that they were designated as the initial beneficiaries of the aid authorised by the decision of 13 March
1996, as it maintained in the pleadings. That approach in effect disregards the rule that it is for the undertaking which
had actual use of the misused aid to give back the advantage conferred on it.

126   Consequently, the Commission erred in requiring the repayment of DEM 3 195 559 by the company Saxonia Edelmetalle and the
amount of DEM 2 419 271 by the company ZEMAG.

127   It follows that Article 3 of the contested decision must be annulled in so far as it requires the Federal Republic of Germany
to recover from the applicant in Case T‐111/01 the amount of DEM 3 195 559 and from the applicant in Case T‐133/01 the amount
of DEM 2 419 271.

–       The order to recover the disputed aid as regards the partial amount of DEM 12 000 000 contained in Article 3 of the contested
decision (Case T‐133/01)

128   According to recital 29 of the contested decision:

‘The amount of DEM 12 million was granted after the known failure of the first restructuring operation in the form of liquidity
loans to the Lintra subsidiaries in preparation for further restructuring. ... It was used to repay overdue bills and was granted
between April and June 1997 to those subsidiaries for which a second restructuring seemed feasible. As this aid was granted
by the BvS after the known failure of the first restructuring of the Lintra group and in preparation for the second restructuring,
it cannot be regarded as being covered by the decision of 13 March 1996.’

129   According to recital 45 of the contested decision, the amount of DEM 12 000 000 can ‘clearly be linked to those subsidiaries
to which it was granted after the failure of the first attempt to restructure the Lintra group came to light’. On the basis
of the information supplied by the German authorities, the repayment of the amount of DEM 12 000 000 was demanded from the
different subsidiaries concerned according to the table contained in the same recital, which is reproduced in Article 3 of
the contested decision.

130   Next, the Court notes that the applicant in Case T‐133/01 does not deny that the disputed aid was misused, as found in the
contested decision. The Court also notes that, according to the letter of 10 March 2000 from the German authorities to the
Commission, the amount of DEM 12 000 000 was not covered by the Commission’s decision of 13 March 1996. The German authorities
did not contradict that position in the letter of 2 October 2000 in response to the information injunction decision of 1 August
2000. Consequently, at the time of adopting the contested decision, the Commission was entitled to consider that the amount
of DEM 12 000 000 was neither covered by the decision of 13 March 1996 nor even legal, because it had not been formally notified
to the Commission.

131   The applicant in Case T‐133/01 challenges, however, first, the finding that it received part of the amount of DEM 12 000 000
the repayment of which is now claimed by the Commission, and questions the manner in which the amount of DEM 4 077 000 being
claimed from it was determined.

132   Regarding the issue of whether the company ZEMAG had actual use of part of the amount of DEM 12 000 000, the Court considers,
in the light of the information which the Commission had in its possession at the time of adopting the contested decision,
that it certainly did.

133   The Court notes that, in the letter of 10 March 2000 referred to above, the German authorities confirmed that the amount of
DEM 12 000 000 had been paid to the subsidiaries in April and June 1997 because a second privatisation was planned for those
undertakings. The German authorities presented a ‘preliminary distribution of those funds’ amongst the subsidiaries concerned,
which was the subject of an annex to that letter. The company ZEMAG is referred to three times in the table annexed to the
letter of 10 March 2000, each time next to an amount, with the total amounting to DEM 4 077 000.

134   On 1 August 2000, the Commission, acting pursuant to Article 10(3) of Regulation No 659/1999, instructed the Federal Republic
of Germany to provide inter alia ‘all information enabling it to determine how the expenses of the [Lintra holding company]
have been distributed amongst the subsidiaries’. The Commission also stated that if not all the relevant information, figures
and documents for assessing the legality of the aid were provided, it would be obliged to adopt a decision on the basis of
the information in its possession.

135   The German authorities responded to the information injunction decision of 1 August 2000 by letter of 2 October 2000, to which
they annexed the report of a chartered accountant. According to that information, DEM 7 910 000 DEM (out of a partial amount
of DEM 12 000 000) was to be ascribed to the subsidiaries who had had actual use of the aid. As to the company ZEMAG, the
synoptic table forwarded by the German authorities (also contained in the report of the charted accountant) stated an amount
of DEM 107 000 to be ascribed to that undertaking. For the remainder of DEM 4 090 000 (12 000 000 – 7 910 000), the German
authorities explained that that amount was to be ascribed only to the Lintra holding company because that amount had in part
(in the amount of DEM 421 000) been allocated to other privatisation activities in 1998, with the rest (DEM 3 669 000) having
gone to finance the Lintra holding company for plant and personnel expenditure. The German authorities added that the amount
to be ascribed to the subsidiaries had been notified to the Commission as part of the second round of privatisation of the
undertakings concerned.

136   The aforementioned items of information sent by the German authorities to the Commission show that the Commission was able
to find, at the time of adopting the contested decision, that the company ZEMAG had had actual use of part of the partial
amount of DEM 12 000 000 considered to have been misused.

137   However, regarding the applicant’s argument alleging essentially that there was an insufficient statement of reasons for recovery
of the amount of DEM 4 077 000 from it, the Court considers that, for the reasons set out below, that complaint is well founded.

138   According to settled case-law, in order to satisfy the requirements of Article 253 EC, the statement of reasons for a decision
must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the
institution which adopted the measure in question so as to enable the persons concerned to ascertain the reasons for the measure
and to enable the Community judicature to exercise its power of review. Although it is not necessary for the reasoning to
go into all the relevant facts and points of law, it must be assessed with regard not only to its wording but also to its
context and to all the legal rules governing the matter in question (Case C‐56/93 *Belgium* v *Commission*[1996] ECR I‐723, paragraph 86; Case C‐5/01 *Belgium* v *Commission*[2002] ECR I‐11991, paragraph 68; *Skibsværftsforeningen and Others* v *Commission*, paragraph 230; and Case T‐158/96 *Acciaierie di Bolzano* v *Commission*[1999] ECR II‐3927, paragraph 167).

139   In the present case, the only reason for the obligation imposed on the Federal Republic of Germany to recover the amount of
DEM 4 077 000 from the company ZEMAG, as set out in recital 45 of the contested decision, is based on ‘information which Germany
has supplied’.

140   Given the context of which the contested decision forms a part, the Court finds that such reasoning is inadequate.

141   As noted in paragraph 133 above, the Court observes that in their letter of 10 March 2000, referred to above, the German authorities
had stated expressly that the information they were forwarding to the Commission was only a ‘preliminary distribution’ of
the amount of DEM 12 000 000 amongst the subsidiaries. In their letter of 2 October 2000, the German authorities, in response
to the information injunction decision of 1 August 2000 requesting them to provide ‘all information enabling it to determine
how the expenses of the [Lintra holding company] were distributed amongst the subsidiaries’, provided calculations, referred
to in paragraph 135 above, according to which an amount of DEM 107 000 (out of a partial amount of DEM 12 000 000) was to
be ascribed to the company ZEMAG, that allocation being, in the view of the German authorities, the ‘actual use of the aid’.

142   When questioned by the Court about the reasons for which the amount of DEM 4 077 000 had been ascribed to the company ZEMAG
by Article 3 of the contested decision, the Commission stated that the information provided by the German authorities in response
to the information injunction decision of 1 August 2000 did not explain how the remainder of DEM 107 000, made up of claims
based on payments made by the Lintra holding company to the subsidiaries and claims allegedly held by the subsidiaries against
the holding company, was calculated. Nor is the figure obtained explained in further detail by the German authorities. The
Commission added, however, that it is indisputable that the liquidity loan of DEM 12 000 000 must be recovered in its entirety
and that it is the apportionment indicated in the letter of 10 March 2000 from the German authorities referred to above which
served as a basis for the Commission’s recovery order, issued in the absence of more specific and comprehensible information.

143   It follows from the foregoing that the Commission ordered the recovery of the amount DEM 4 077 000 from the company ZEMAG
without having proven or even explained why such an amount was being claimed.

144   It is true that, as stated by the Commission, the objective of recovering the amount of DEM 12 000 000 must be achieved. However,
the manner in which the aid is distributed amongst actual beneficiaries cannot be established without stating adequate reasons
in the contested decision and on the basis of mere suppositions.

145   Although when the Commission, acting pursuant to Article 10(3) of Regulation No 659/1999, issues an information injunction
it may, pursuant to Article 13(1) of that regulation, ‘where ... the Member State concerned does not provide the information
requested’, adopt a decision to close the investigation procedure on the basis of the information available, it is not released
from its obligation to state sufficiently the reasons which have led it to consider that the information provided by a Member
State, in response to the information injunction, cannot be relied on in the final decision which it intends to adopt. Such
a situation cannot be likened to one where a Member State fails to provide any information to the Commission in response to
an injunction issued pursuant to Article 10(3) of Regulation No 659/1999, in which case the reasons may be limited to merely
stating that the Member State has failed to respond to the injunction. In the present case therefore, the Commission was required
to state in the contested decision the reasons for which it considered that the information provided by the German authorities
in response to the information injunction decision of 1 August 2000 could not be taken into consideration for the purposes
of determining the amount of aid to be repaid by the company ZEMAG.

146   The Court also notes that the Federal Republic of Germany, in its letter of 2 October 2000 referred to in paragraph 135 above,
had drawn the Commission’s attention to the fresh notification of aid granted to the subsidiaries concerned as part of their
second restructuring, an observation moreover included in recital 41 of the contested decision. The Commission could not have
been unaware, at the time it adopted the contested decision, that it had decided on 1 February 2001, that is, approximately
two months before the adoption of the contested decision, to open a formal investigation procedure with respect to restructuring
aid for the company ZEMAG, the text of which is included in the invitation to submit observations published in the *Official Journal of the European Communities* (OJ 2001 C 133, p. 3), in which it stated that of the amount of aid to that company as from 1 January 1997, ‘aid amounting
to DEM 107 000 is assessed as part of the decision on the Case C‐41/99 *Lintra Beteiligungsholding GmbH*’’, as part of the procedure having led to the adoption of the contested decision. In those circumstances, it was for the
Commission at least to state the reasons for the difference between that amount ascribed to the company ZEMAG and the amount
used in the contested decision.

147   It follows that the statement of reasons on which the contested decision is based is inadequate having regard to Article 253
EC in so far as it relates to the obligation for the Federal Republic of Germany to recover aid in the amount of DEM 4 077 000
from the company ZEMAG.

148   In the light of the foregoing, Article 3 of the contested decision must be annulled in so far as it instructs the Federal
Republic of Germany to recover, first, aid in the amount of DEM 3 195 559 from the applicant in Case T‐111/01, including the
appurtenant interest and, second, aid totalling DEM 6 496 271 from the applicant in Case T‐133/01, including the appurtenant
interest.

149   In those circumstances, it is not necessary to rule on the applicants’ common plea relating to the arbitrary nature of the
manner in which the apportionment formula was set amongst the applicants for the amount of DEM 22 978 000 to be repaid, since
the order to repay the disputed aid, calculated on the basis of the aforementioned amount, has been annulled in so far as
regards the applicants. Nor is it necessary to rule on the common plea relating to the alleged error as to the imputability
of the obligation to repay the disputed aid, owing to the transfer of the shares of the applicant in Case T‐111/01 and the
applicant in Case T‐133/01 respectively, since the order to repay the disputed aid in both cases is to be annulled.

**Costs**

150   Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been
applied for in the successful party’s pleadings. Since the Commission has been unsuccessful, it must, having regard to the
form of order sought by the applicants, be ordered to pay the costs, including those relating to the interim proceedings in
Case T‐111/01.

151   On those grounds,

THE COURT OF FIRST INSTANCE (First Chamber, Extended Composition)

hereby:

1.      **Annuls Article 3 of Commission Decision 2001/673/EC of 28 March 2001 on State aid implemented by Germany for EFBE Verwaltungs
GmbH &Co. Management KG (now Lintra Beteiligungsholding GmbH, together with Zeitzer Maschinen, Anlagen Geräte GmbH; LandTechnik
Schlüter GmbH; ILKA MAFA Kältetechnik GmbH; SKL Motoren- und Systembautechnik GmbH; SKL Spezialapparatebau GmbH; Magdeburger
Eisengießerei GmbH; Saxonia Edelmetalle GmbH and Gothaer Fahrzeugwerk GmbH) in so far as it requires the Federal Republic
of Germany to recover an amount of DEM 3 195 559, including the appurtenant interest, from the company Saxonia Edelmetalle
GmbH and a total aid amount of DEM 6 496 271, including the appurtenant interest, from the company Zeitzer Maschinen, Anlagen
Geräte (ZEMAG) GmbH;**

2.      **Dismisses the remainder of the action;**

3.      **Orders the Commission to pay the costs, including those relating to the interim proceedings in Case T‐111/01.**

| Vesterdorf | Jaeger | Mengozzi |
| ---------- | ------ | -------- |

| Martins Ribeiro | | Dehousse |
| --------------- | | -------- |

Delivered in open court in Luxembourg on 11 May 2005.

| H. Jung | | B. Vesterdorf |
| ------- | | ------------- |

| Registrar | | President |
| --------- | | --------- |

Table of contents

Legal framework

Background to the dispute

Procedure and forms of order sought

Law

The common plea relating to violation of the applicants’ rights in the procedure provided for in Article 88(2) EC

Arguments of the parties

– In Case T‐111/01

– In Case T‐133/01

Findings of the Court

The plea relating to factual errors in the contested decision (Case T‐133/01)

Arguments of the parties

Findings of the Court

The plea alleging errors in the finding of misuse of aid authorised by the Commission’s decision of 13 March 1996 (Case T‐111/01)

Arguments of the parties

Findings of the Court

– The scope of the decision of 13 March 1996

– The finding of misuse of the amount of aid which the applicant in Case T‐111/01 is being asked to repay

The common plea alleging error by the Commission in the determination of the beneficiary of the disputed aid

Arguments of the parties

– In Case T‐111/01

– In Case T‐133/01

Findings of the Court

– The order to recover disputed aid as regards the partial aid amount of DEM 22 978 000 contained in Article 3 of the contested
decision (Cases T‐111/01 and T‐133/01)

– The order to recover the disputed aid as regards the partial amount of DEM 12 000 000 contained in Article 3 of the contested
decision (Case T‐133/01)

Costs

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- Language of the case: German.