# C_2019054EN.01002101.xml

| 11.2.2019 | EN | Official Journal of the European Union | C 54/21 |
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11.2.2019

EN

Official Journal of the European Union

C 54/21

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Action brought on 27 November 2018 — Poland v Commission

(Case T-703/18)

(2019/C 54/36)

Language of the case: Polish

Parties

Applicant: Republic of Poland (represented by: B. Majczyna, acting as Agent)

Defendant: European Commission

Form of order sought

The applicant claims that the Court should:

| — | annul the decision of the European Commission of 17 September 2018 imposing an obligation to implement the actions and recommendations set out in the final audit report, in the part concerning Recommendation 04.01(g) regarding the application of financial corrections to expenditure relating to VAT in connection with cases where the participants receiving aid were taxable persons for the purposes of VAT and as a result were entitled to recover VAT, but did not do so, under projects carried out within the framework of all operational programmes co-financed by the European Social Fund, in respect of which expenditure was declared for the purposes of reimbursement by the European Commission; |
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annul the decision of the European Commission of 17 September 2018 imposing an obligation to implement the actions and recommendations set out in the final audit report, in the part concerning Recommendation 04.01(g) regarding the application of financial corrections to expenditure relating to VAT in connection with cases where the participants receiving aid were taxable persons for the purposes of VAT and as a result were entitled to recover VAT, but did not do so, under projects carried out within the framework of all operational programmes co-financed by the European Social Fund, in respect of which expenditure was declared for the purposes of reimbursement by the European Commission;

| — | order the European Commission to pay the costs. |
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order the European Commission to pay the costs.

Pleas in law and main arguments

In support of the action, the applicant relies on a single plea in law, alleging infringement of Article 65(2) and Article 69(3)(c) of Regulation No 1303/2013, (1) read in conjunction with Article 2(10) thereof, through the improper interpretation of those provisions and the incorrect finding that Article 69(3)(c) of Regulation No 1303/2013 applies to final recipients of aid from the European Social Fund, despite the fact that they are not beneficiaries within the meaning of Article 2(10) of that regulation.

In that plea, the Republic of Poland states that, in accordance with the general rule regarding the eligibility of expenditure under European Social Fund projects as set out in Article 65(2) of Regulation No 1303/2013, the requirements for eligibility of expenditure resulting from Article 69 of that regulation are the responsibility of the beneficiary implementing the project.

The applicant considers that Article 2(10) of Regulation No 1303/2013 unambiguously leaves it to the Member States to choose, in cases involving aid with a value lower than EUR 200 000, whether to recognise a person receiving aid or a person providing such aid as the beneficiary.

In the present case, at the choice of the Polish authorities, the beneficiary is the person providing the aid and not the person receiving it. Final recipients of aid are not beneficiaries and thus, according to the applicant, Article 69(3)(c) of Regulation No 1303/2013 does not apply to them.

In addition, the Republic of Poland emphasises that, in the present case, granting the status of beneficiary to the persons receiving aid — who are unemployed persons — would involve imposing on them many obligations connected with accounting for the aid received, reporting on progress in implementing the project, project controls and supplementing data in IT systems dedicated to the implementation of operational programmes. Such a solution would make it impossible to achieve the aims of Regulation No 1303/2013.

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(1)  Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17 December 2013 laying down common provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund and laying down general provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund and the European Maritime and Fisheries Fund and repealing Council Regulation (EC) No 1083/2006 (OJ 2013 L 347, p. 320).

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