# C_2015046EN.01006001.xml

| 9.2.2015 | EN | Official Journal of the European Union | C 46/60 |
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Action brought on 12 December 2014 — BPC Lux 2 a.o. v Commission

(Case T-812/14)

(2015/C 046/78)

Language of the case: English

Parties

Applicants: BPC Lux 2 Sàrl (Senningerberg, Luxembourg), BPC UKI LP (George Town, Cayman Islands), Bennett Offshore Restructuring Fund, Inc. (George Town, Cayman Islands), Bennett Restructuring Fund LP (Wilmington, United States), Queen Street Fund Ltd (George Town, Cayman Islands), BTG Pactual Global Emerging Markets and Macro Master Fund LP (George Town, Cayman Islands), BTG Pactual Absolute Return II Master Fund LP (George Town, Cayman Islands), CSS LLC (Chicago, United States), Beltway Strategic Opportunities Fund LP (George Town, Cayman Islands), EJF Debt Opportunities Master Fund LP (George Town, Cayman Islands), EJF DO Fund (Cayman) LP (George Town, Cayman Islands), TP Lux HoldCo (Luxembourg, Luxembourg), VR Global Partners LP (George Town, Cayman Islands), Absalon II Ltd (Dublin, Ireland), CenturyLink, Inc. Defined Benefit Master Trust (Denver, United States), City of New York Group Trust (New York, United States), Dignity Health (San Francisco, United States), GoldenTree Asset Management Lux Sàrl (Luxembourg, Luxembourg), GoldenTree High Yield Value Fund Offshore 110 Two Ltd (Dublin, Ireland), San Bernardino County Employees Retirement Association (San Bernardino, United States) (represented by: J. Webber and M. Steenson, Solicitors and P. Fajardo, lawyer)

Defendants: European Commission

Form of order sought

The applicants claim that the Court should:

| — | annul the decision adopted by the Commission on 3 August 2014 not to raise objections to a measure notified by Portugal for the restructuring of Banco Espirito Santo S.A. (BES), in the procedure SA.39250; and |
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| — | order the Commission to pay the costs of the applicants. |
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Pleas in law and main arguments

In support of the action, the applicants rely on two pleas in law.

| 1. | First plea in law, alleging that the Commission committed errors of law, fact and procedure in manifestly failing to correctly assess the counterfactual, in particular regarding the availability of private capital to participate in the restructuring of BES.
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The Commission breached numerous requirements of the Banking Communication by failing to assess at all, or alternatively failing to provide reasoning, in respect of whether: a) aid was limited to the minimum necessary, b) private capital had been exploited to the maximum extent, c) an exception to the requirement that subordinated debt holders contribute in full on basis of impact on financial stability and disproportionality applied, and d) the no creditor worse off principle had been respected. —
The Commission failed to investigate the counterfactual and therefore made an incorrect factual assumption that the only alternative to the notified measures was liquidation of BES. The Commission failed to consider the evidence that new private capital was available and could have reduced the State aid required by the notified measure. —
The Commission was under a duty to initiate the formal investigation procedure under Article 108(2) TFEU. In failing to do so, the Commission breached the applicants’ procedural rights under that provision. | — | The Commission breached numerous requirements of the Banking Communication by failing to assess at all, or alternatively failing to provide reasoning, in respect of whether: a) aid was limited to the minimum necessary, b) private capital had been exploited to the maximum extent, c) an exception to the requirement that subordinated debt holders contribute in full on basis of impact on financial stability and disproportionality applied, and d) the no creditor worse off principle had been respected. | — | The Commission failed to investigate the counterfactual and therefore made an incorrect factual assumption that the only alternative to the notified measures was liquidation of BES. The Commission failed to consider the evidence that new private capital was available and could have reduced the State aid required by the notified measure. | — | The Commission was under a duty to initiate the formal investigation procedure under Article 108(2) TFEU. In failing to do so, the Commission breached the applicants’ procedural rights under that provision. |
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| — | The Commission breached numerous requirements of the Banking Communication by failing to assess at all, or alternatively failing to provide reasoning, in respect of whether: a) aid was limited to the minimum necessary, b) private capital had been exploited to the maximum extent, c) an exception to the requirement that subordinated debt holders contribute in full on basis of impact on financial stability and disproportionality applied, and d) the no creditor worse off principle had been respected. | | | | | | |
| — | The Commission failed to investigate the counterfactual and therefore made an incorrect factual assumption that the only alternative to the notified measures was liquidation of BES. The Commission failed to consider the evidence that new private capital was available and could have reduced the State aid required by the notified measure. | | | | | | |
| — | The Commission was under a duty to initiate the formal investigation procedure under Article 108(2) TFEU. In failing to do so, the Commission breached the applicants’ procedural rights under that provision. | | | | | | |

| 2. | Second plea in law, alleging that the Commission breached the applicants’ procedural rights in failing to open the formal investigation procedure.
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The notification, considered objectively, raised serious difficulties of assessment with respect to both facts and law. —
The Commission’s preliminary assessment, lasting a single Sunday, cannot have been complete and sufficient given the significance and difficulty of the subject matter of the investigation. —
The Commission had reasons to believe that the information before it may be unreliable or at a minimum required verification before reliance could be placed upon it. —
The Commission failed to consider paragraphs 50 to 53 of the Banking Communication, which establishes a two stage rescue and restructuring process for urgent situations such as that of BES. —
The Commission had a duty to open a formal investigation. The Commission's failure to do so deprived the applicants, as interested parties, of any ability to participate in the procedure, in breach of their legitimate procedural rights under Article 108(2) TFEU. | — | The notification, considered objectively, raised serious difficulties of assessment with respect to both facts and law. | — | The Commission’s preliminary assessment, lasting a single Sunday, cannot have been complete and sufficient given the significance and difficulty of the subject matter of the investigation. | — | The Commission had reasons to believe that the information before it may be unreliable or at a minimum required verification before reliance could be placed upon it. | — | The Commission failed to consider paragraphs 50 to 53 of the Banking Communication, which establishes a two stage rescue and restructuring process for urgent situations such as that of BES. | — | The Commission had a duty to open a formal investigation. The Commission's failure to do so deprived the applicants, as interested parties, of any ability to participate in the procedure, in breach of their legitimate procedural rights under Article 108(2) TFEU. |
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| — | The notification, considered objectively, raised serious difficulties of assessment with respect to both facts and law. | | | | | | | | | | |
| — | The Commission’s preliminary assessment, lasting a single Sunday, cannot have been complete and sufficient given the significance and difficulty of the subject matter of the investigation. | | | | | | | | | | |
| — | The Commission had reasons to believe that the information before it may be unreliable or at a minimum required verification before reliance could be placed upon it. | | | | | | | | | | |
| — | The Commission failed to consider paragraphs 50 to 53 of the Banking Communication, which establishes a two stage rescue and restructuring process for urgent situations such as that of BES. | | | | | | | | | | |
| — | The Commission had a duty to open a formal investigation. The Commission's failure to do so deprived the applicants, as interested parties, of any ability to participate in the procedure, in breach of their legitimate procedural rights under Article 108(2) TFEU. | | | | | | | | | | |

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