# C_2016296EN.01003401.xml

| 16.8.2016 | EN | Official Journal of the European Union | C 296/34 |
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Action brought on 28 June 2016 — Esko-Graphics v Commission

(Case T-335/16)

(2016/C 296/44)

Language of the case: Dutch

Parties

Applicant: Esko-Graphics BVBA (Ghent, Belgium) (represented by: H. Viaene, B. Hoorelbeke, D. Gillet and F. Verhaegen, lawyers)

Defendant: European Commission

Form of order sought

The applicant claims that the General Court should:

| — | declare the application for annulment admissible; |
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| — | annul the decision of the European Commission of 11 January 2016 on the excess profit exemption State aid scheme SA.37667 (2015/C) (ex 2015/NN) implemented by Belgium, as published on the European Commission website on 4 May 2016; |
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| — | order the Commission to pay the costs. |
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Pleas in law and main arguments

In support of its action, the applicant relies on four pleas in law.

| 1. | First plea in law, alleging infringement of Article 1(d) of Regulation 2015/1589,( 1 ) Article 107(1) TFEU and Article 296 TFEU in so far as the Commission wrongly classifies the contested measure as an aid measure.
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The Commission infringes Article 1(d) of Regulation 2015/1589 and Article 107(1) TFEU since it wrongly classifies the contested measure as an aid measure. The contested aid cannot be allocated solely on the basis of Article 185(2)(b) of the Wetboek van de inkomstenbelastingen van 1992 (Belgian Income Tax Code of 1992; ‘the WIB 1992’), but requires additional implementing measures in order for that provision to be applied. —
The Commission infringes Article 296 TFEU in so far as its statement of reasons contains a contradiction. The contradiction lies in the fact that the Commission does not explain why, when assessing the criterion of selectivity, it takes the view that the previous decisions do not stem directly from Article 185(2)(b) of the WIB 1992, whereby it assumes, in assessing the existence of an aid measure, that the provision referred to does not require any additional implementing measures. | — | The Commission infringes Article 1(d) of Regulation 2015/1589 and Article 107(1) TFEU since it wrongly classifies the contested measure as an aid measure. The contested aid cannot be allocated solely on the basis of Article 185(2)(b) of the Wetboek van de inkomstenbelastingen van 1992 (Belgian Income Tax Code of 1992; ‘the WIB 1992’), but requires additional implementing measures in order for that provision to be applied. | — | The Commission infringes Article 296 TFEU in so far as its statement of reasons contains a contradiction. The contradiction lies in the fact that the Commission does not explain why, when assessing the criterion of selectivity, it takes the view that the previous decisions do not stem directly from Article 185(2)(b) of the WIB 1992, whereby it assumes, in assessing the existence of an aid measure, that the provision referred to does not require any additional implementing measures. |
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| — | The Commission infringes Article 1(d) of Regulation 2015/1589 and Article 107(1) TFEU since it wrongly classifies the contested measure as an aid measure. The contested aid cannot be allocated solely on the basis of Article 185(2)(b) of the Wetboek van de inkomstenbelastingen van 1992 (Belgian Income Tax Code of 1992; ‘the WIB 1992’), but requires additional implementing measures in order for that provision to be applied. | | | | |
| — | The Commission infringes Article 296 TFEU in so far as its statement of reasons contains a contradiction. The contradiction lies in the fact that the Commission does not explain why, when assessing the criterion of selectivity, it takes the view that the previous decisions do not stem directly from Article 185(2)(b) of the WIB 1992, whereby it assumes, in assessing the existence of an aid measure, that the provision referred to does not require any additional implementing measures. | | | | |

| 2. | Second plea in law, alleging infringement of Article 107(1) TFEU and breach of the obligation to state reasons under Article 296 TFEU, to the extent that the Commission did not correctly assess the existence of an advantage.
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The Commission failed to investigate whether the contested aid measure led in fact to the conferral of an advantage, as contemplated by Article 107(1) TFEU, on the recipient undertakings. This was in spite of the fact that that condition is a prerequisite for State aid, and that the Commission is thus required to examine it before deciding on whether State aid exists, failing which it will be in breach of its obligation to state reasons under Article 296 TFEU. | — | The Commission failed to investigate whether the contested aid measure led in fact to the conferral of an advantage, as contemplated by Article 107(1) TFEU, on the recipient undertakings. This was in spite of the fact that that condition is a prerequisite for State aid, and that the Commission is thus required to examine it before deciding on whether State aid exists, failing which it will be in breach of its obligation to state reasons under Article 296 TFEU. |
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| — | The Commission failed to investigate whether the contested aid measure led in fact to the conferral of an advantage, as contemplated by Article 107(1) TFEU, on the recipient undertakings. This was in spite of the fact that that condition is a prerequisite for State aid, and that the Commission is thus required to examine it before deciding on whether State aid exists, failing which it will be in breach of its obligation to state reasons under Article 296 TFEU. | | |

| 3. | Third plea in law, alleging infringement of Article 107(1) TFEU and breach of the obligation to state reasons under Article 296 TFEU, to the extent that the Commission did not correctly assess whether the contested measure was selective in nature.
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Article 185(2)(b) of the WIB 1992 and the excess profit exemption system arising out of it are open to all undertakings in a comparable factual and legal situation and which conduct the economic transactions that form the subject matter of the contested measure. The contested measure is therefore not restricted to specific undertakings that can be defined on the basis of particular features, and is thus not selective for the purposes of Article 107(1) TFEU. —
In the alternative, the Commission committed a manifest error of assessment in finding that the exemption of excess profit did not form part of the reference system. The exemption of excess profit on the basis of synergies and economies of scale in application of the arm’s length principle is an integral component of the provisions that determine total taxable income, and thus cannot be regarded as constituting a derogation from the reference system that leads to selectivity. —
In the further alternative, the Commission is unable to prove that the arm’s length principle was incorrectly applied by the Belgische Rulingcommissie (Belgian Tax Ruling Committee) in the context of the application of Article 185(2)(b) of the WIB 1992. The Commission’s reasoning is not coherent and takes into account important factors which are, however, contradictory or lack the requisite coherence. | — | Article 185(2)(b) of the WIB 1992 and the excess profit exemption system arising out of it are open to all undertakings in a comparable factual and legal situation and which conduct the economic transactions that form the subject matter of the contested measure. The contested measure is therefore not restricted to specific undertakings that can be defined on the basis of particular features, and is thus not selective for the purposes of Article 107(1) TFEU. | — | In the alternative, the Commission committed a manifest error of assessment in finding that the exemption of excess profit did not form part of the reference system. The exemption of excess profit on the basis of synergies and economies of scale in application of the arm’s length principle is an integral component of the provisions that determine total taxable income, and thus cannot be regarded as constituting a derogation from the reference system that leads to selectivity. | — | In the further alternative, the Commission is unable to prove that the arm’s length principle was incorrectly applied by the Belgische Rulingcommissie (Belgian Tax Ruling Committee) in the context of the application of Article 185(2)(b) of the WIB 1992. The Commission’s reasoning is not coherent and takes into account important factors which are, however, contradictory or lack the requisite coherence. |
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| — | Article 185(2)(b) of the WIB 1992 and the excess profit exemption system arising out of it are open to all undertakings in a comparable factual and legal situation and which conduct the economic transactions that form the subject matter of the contested measure. The contested measure is therefore not restricted to specific undertakings that can be defined on the basis of particular features, and is thus not selective for the purposes of Article 107(1) TFEU. | | | | | | |
| — | In the alternative, the Commission committed a manifest error of assessment in finding that the exemption of excess profit did not form part of the reference system. The exemption of excess profit on the basis of synergies and economies of scale in application of the arm’s length principle is an integral component of the provisions that determine total taxable income, and thus cannot be regarded as constituting a derogation from the reference system that leads to selectivity. | | | | | | |
| — | In the further alternative, the Commission is unable to prove that the arm’s length principle was incorrectly applied by the Belgische Rulingcommissie (Belgian Tax Ruling Committee) in the context of the application of Article 185(2)(b) of the WIB 1992. The Commission’s reasoning is not coherent and takes into account important factors which are, however, contradictory or lack the requisite coherence. | | | | | | |

| 4. | Fourth plea in law, alleging breach of the principle of legal certainty in imposing an obligation to recover.
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On the basis of the well-established line of decisions of the Commission that did not call into question the application of the internationally recognised arm’s length principle, it would be at variance with the principle of legal certainty if an order for the recovery of the alleged aid were to be applied in the present case. On the basis of the existing line of decisions and case-law, it could not, in any event, have been foreseen that Article 185(2)(b) of the WIB would be contrary to Article 107 TFEU. | — | On the basis of the well-established line of decisions of the Commission that did not call into question the application of the internationally recognised arm’s length principle, it would be at variance with the principle of legal certainty if an order for the recovery of the alleged aid were to be applied in the present case. On the basis of the existing line of decisions and case-law, it could not, in any event, have been foreseen that Article 185(2)(b) of the WIB would be contrary to Article 107 TFEU. |
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| — | On the basis of the well-established line of decisions of the Commission that did not call into question the application of the internationally recognised arm’s length principle, it would be at variance with the principle of legal certainty if an order for the recovery of the alleged aid were to be applied in the present case. On the basis of the existing line of decisions and case-law, it could not, in any event, have been foreseen that Article 185(2)(b) of the WIB would be contrary to Article 107 TFEU. | | |

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( 1 )  Council Regulation (EU) 2015/1589 of 13 July 2015 laying down detailed rules for the application of Article 108 of the Treaty on the Functioning of the European Union (OJ 2015 L 248, p. 9).

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