**Case T-445/05**

**Associazione italiana del risparmio gestito and Fineco Asset Management SpA**

**v**

**Commission of the European Communities**

(State aid – Aid scheme implemented by the Italian authorities for certain undertakings for collective investment in transferable securities
specialised in shares of small- and medium-capitalisation companies – Decision declaring the aid incompatible with the common market – Actions for annulment – Direct and individual concern – Admissibility – Obligation to state the reasons on which the decision is based – Selective nature of the measure – Obligation of recovery)

Summary of the Judgment

1.      *Actions for annulment – Natural or legal persons – Measures of direct and individual concern to them – Commission decision
prohibiting a sectoral aid scheme – Action by a recipient undertaking of individual aid granted under that scheme and having
to be recovered – Admissibility*

*(Art. 230, fourth para., EC)*

2.      *Acts of the institutions – Statement of reasons – Obligation – Scope – Commission decision on State aid*

*(Arts 87 EC and 253 EC)*

3.      *Acts of the institutions – Statement of reasons – Obligation – Scope – Commission decision on State aid*

*(Arts 87(1) EC and 253 EC)*

4.      *State aid – Concept – Tax reduction granted to investors in specialised investment vehicles – Reduction leading to an indirect
transfer of State resources for an undertaking which is separate from the exempt taxpayer*

*(Art. 87(1) EC)*

5.      *State aid – Examination by the Commission – Examination of an aid scheme in its totality – Lawfulness – Consequence*

*(Art. 87(1) EC)*

6.      *State aid – Concept – Selective nature of the measure – Tax reduction limited to specialised investment vehicles and their
managing undertakings – Included*

*(Art. 87(1) CE)*

7.      *State aid – Concept – Measure allowing the recipients to increase their own resources on more favourable terms – Included*

*(Art. 87(1) EC)*

8.      *State aid – Concept – Selective nature of the measure*

*(Art. 87(1) EC)*

9.      *State aid – Recovery of unlawful aid – Obligation resulting from the unlawfulness*

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

1.      Persons other than those to whom a decision is addressed may claim to be individually concerned only if the decision affects
them by reason of certain attributes peculiar to them or by reason of circumstances in which they are differentiated from
all other persons and if, by virtue of those factors, it distinguishes them individually in the same way as the person addressed.
Thus, an undertaking cannot, as a general rule, contest a decision of the Commission which prohibits a sectoral aid scheme
if it is concerned by that decision solely by virtue of belonging to the sector in question and being a potential beneficiary
of the scheme. Such a decision is, vis-à-vis the applicant undertaking, a measure of general application covering situations
which are determined objectively and entails legal effects for a class of persons envisaged in a general and abstract manner.

In the case of a Commission decision which does not identify the undertaking or undertakings in receipt of the aid in question
and which therefore applies to situations which are determined objectively and entails legal effects for a class of persons
envisaged in a general and abstract manner, an undertaking may, however, be concerned by that decision not only as an undertaking
in the relevant sector as a potential beneficiary of the aid scheme, but also as an actual recipient of individual aid granted
under that scheme, recovery of which has been ordered by the Commission. That undertaking is individually concerned by that
decision and its action against the decision is admissible.

(see paras 45-48)

2.      The statement of reasons required by Article 253 EC must be appropriate to the measure at issue and must disclose in a clear
and unequivocal fashion the reasoning followed by the institution which adopted that measure in such a way as to enable the
persons concerned to ascertain the reasons for the measure and to enable the Court to exercise its power of review. The requirement
to state reasons must be assessed according to the circumstances of the case. It is not necessary for the reasoning to go
into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements
of Article 253 EC must be assessed with regard not only to its wording but also to its context and all the legal rules governing
the matter in question. In particular, the Commission is not obliged to adopt a position on all the arguments relied on by
the parties concerned; rather, it is sufficient if it sets out the facts and the legal considerations having decisive importance
in the context of the decision.

In the case of a State aid scheme, the Commission may confine itself to examining the general characteristics of the scheme
in question without being required to examine each particular case.

(see paras 67-68)

3.      Although the Commission is required, in the reasons for its decision, to refer at least to the circumstances in which aid
has been granted where those circumstances show that the aid is such as to affect trade between Member States, it is not required
to demonstrate the actual effect of aid already granted. If it were so required, that requirement would ultimately give Member
States which grant unlawful aid an advantage over those which notify aid at the planning stage.

The Commission is not under a duty to carry out an economic analysis of the actual situation on the relevant market, or of
the market share of the beneficiary undertakings, or of the position of competing undertakings, or of trade flows between
Member States in the services in question, once it has explained how the aid at issue distorts competition and affects trade
between Member States. As the aid was not notified, the Commission was not required to establish the actual effects of that
aid.

(see paras 102, 109)

4.      Article 87 EC prohibits aid granted by a State or through State resources in any form whatsoever, without drawing a distinction
as to whether the aid-related advantages are granted directly or indirectly. Thus, an advantage granted directly to certain
natural or legal persons who are not necessarily undertakings may constitute an indirect advantage, hence aid, for other natural
or legal persons who are undertakings.

It is not necessary, in order to found a finding of the existence of intervention by means of State resources in favour of
an undertaking, that the undertaking must be the direct beneficiary. Even if specialised investment vehicles do not benefit
directly from the tax reduction granted to their investors, they may none the less receive an indirect economic benefit.

(see paras 127, 131)

5.      In the case of an aid scheme, the Commission may, in order to assess whether that scheme comprises aid elements, confine itself
to examining the general characteristics of the scheme in question without being required to examine each particular case
in which it applies. Accordingly, where it is not disputed that the tax provision under consideration operates to the benefit
of certain undertakings, the fact that, in some circumstances, it may also benefit entities which are not undertakings does
not call into question that finding, which is sufficient for Article 87(1) EC to apply to an aid scheme.

(see para. 136)

6.      A State measure providing for a tax reduction limited to specialised investment vehicles and their managing undertakings,
being thus limited to well-defined investment vehicles which fulfil specific conditions to the detriment of other undertakings
offering alternative forms of investment, favours certain investment vehicles as compared with others which are in a comparable
legal and factual situation. Such a measure, which cannot be regarded as a general measure of fiscal or economic policy, but
as an exception to the general tax scheme, is therefore selective for the purposes of Article 87(1) EC.

Moreover, the mere fact that the advantage may benefit any investment vehicle fulfilling the conditions laid down does not
suffice to establish that the measure at issue is general in scope and does not preclude the measure at issue from being selective
in nature.

Furthermore, aid may be selective for the purposes of Article 87(1) EC even if it concerns a whole economic sector.

(see paras 150, 152, 155-156)

7.      A State measure allowing the undertakings concerned to increase their own resources on more favourable terms, such as a mere
increase in liquidity, constitute an advantage within the meaning of Article 87(1) EC.

(see para. 163)

8.      If it were to be considered that a selective State measure could escape Article 87(1) EC if it pursued an economic or industrial
policy objective, such as the promotion of investment, that provision would have no practical effect. The objective pursued
by such a measure cannot therefore enable it to escape being categorised as State aid within the meaning of Article 87(1)
EC.

(see para. 170)

9.      Article 14(1) of Regulation No 659/1999 relating to the application of Article 88 EC provides that, where negative decisions
are taken in cases of unlawful State aid, the Commission is to decide that the Member State concerned is to take all necessary
measures to recover the aid from the beneficiary. The Commission is not to require recovery of the aid if this would be contrary
to a general principle of Community law. Removing unlawful aid by means of recovery is the logical consequence of a finding
that the aid is unlawful, the purpose of which is to re-establish the previous situation. By repaying, 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.
It follows that the main objective pursued in requiring the repayment of unlawfully paid State aid is to eliminate the distortion
of competition caused by the competitive advantage afforded by the unlawful aid.

(see paras 190-193)

JUDGMENT OF THE COURT OF FIRST INSTANCE (Fifth Chamber)

4 March 2009 (*)

(State aid – Aid scheme implemented by the Italian authorities for certain undertakings for collective investment in transferable securities
specialised in shares of small- and medium-capitalisation companies – Decision declaring the aid incompatible with the common market – Actions for annulment – Direct and individual concern – Admissibility – Obligation to state the reasons on which the decision is based – Selective nature of the measure – Obligation of recovery)

In Case T‐445/05,

**Associazione italiana del risparmio gestito,** established in Rome (Italy),

**Fineco Asset Management SpA,** established in Rome,

represented by G. Escalar, G. Cipolla and V. Giordano, lawyers,

applicants,

v

**Commission of the European Communities,** represented by V. Di Bucci and E. Righini, acting as Agents,

defendant,

APPLICATION for annulment of Commission Decision 2006/638/EC of 6 September 2005 on the aid scheme implemented by Italy for
certain undertakings for collective investment in transferable securities specialised in shares of small- and medium-capitalisation
companies listed on regulated markets (OJ 2006 L 268, p. 1),

THE COURT OF FIRST INSTANCE OF THE EUROPEAN COMMUNITIES (Fifth Chamber),

composed of M. Vilaras, President, F. Dehousse (Rapporteur) and D. Šváby, Judges,

Registrar: J. Palacio González, Principal Administrator,

having regard to the written procedure and further to the hearing on 20 November 2007,

gives the following

**Judgment**

**Background to the dispute**

*Measure at issue*

1        The measure at issue was introduced by Article 12 of Italian Decree-Law (Decreto Legge) No 269 of 30 September 2003 providing
for measures ‘to promote development and to correct the trend of public finances’ (‘DL 269/2003’), subsequently converted
into Law No 326 of 24 November 2003. It entered into force on 2 October 2003, the date of publication of DL 269/2003 in the
Italian Official Journal, without having been notified to the Commission.

2        Article 12 of DL 269/2003 amends the tax treatment of certain undertakings for collective investment in transferable securities,
which are specialised in shares in small- and medium-capitalisation companies listed on a regulated market of the European
Union (‘specialised investment vehicles’).

3        Article 12 of DL 269/2003 provides, inter alia, that, as of the fiscal year in which certain specific requirements are fulfilled,
the capital revenue accruing to the specialised investment vehicles is to be subject to corporation tax at 5%, instead of
at the standard rate of 12.5%.

4        In order to achieve equal effective taxation between foreign and Italian investment vehicles, Article 12 of DL 269/2003 provides
for a reduced nominal rate of 5% substitute tax to be applied to the capital revenue accruing to Italian non-specialised investment
vehicles that invest in Italian specialised investment vehicles, for the part of their income deriving from Italian specialised
investment vehicles, while capital revenue accruing to Italian investment vehicles and deriving from foreign investment vehicles
is 60% exempt.

5        With a view to extending the incentive to other investment vehicles, Article 12 of DL 269/2003 provides that pension funds
are also to be subject to 5% effective tax on the portion of their revenue deriving from foreign specialised investment vehicles,
and that the revenue deriving from Italian investment vehicles is to enjoy a 6% tax credit, corresponding to the 5% substitute
tax imposed on the capital revenue accruing to specialised investment vehicles participated in by such pension funds.

6        All Italian investment vehicles and the foreign undertakings for collective investment in transferable securities regulated
by Council Directive 85/611/EEC of 20 December 1985 on the coordination of laws, regulations and administrative provisions
relating to undertakings for collective investment in transferable securities (UCITS) (OJ 1985 L 375, p. 3) can benefit from
the reduced rate of 5%, provided that they are specialised in investing in stocks of small- and medium-capitalisation companies
listed on a regulated European stock exchange (‘small- and mid-caps’). Pursuant to Article 12 of DL 269/2003, the latter companies
are those whose capital does not exceed EUR 800 million, as determined on the basis of the average market price of the company’s
stocks on the last trading day of each quarter of the year.

7        Pursuant to Article 12 of DL 269/2003, the investment vehicles are specialised if they hold stock of small- and mid-caps for
an amount corresponding to at least two-thirds of the value of their assets held during the calendar year, for at least one-sixth
of the total number of days of operation of the fund, as reported in the periodic financial accounts of such investment vehicles.
The scheme is applicable only as from the fiscal year in which an investment vehicle invests not less than two-thirds of its
total assets in stocks of small- and mid-caps, or as of the time the statutes of the investment vehicle provide for the vehicle
to invest predominantly in stock of small- and mid-caps.

8        Besides the Italian investment vehicles, all other open-ended and closed-ended Italian funds (the ‘historic Luxembourg funds’),
open-ended investment companies (‘SICAVs’) and foreign investment vehicles can benefit from the reduced 5% tax, provided that
they are registered as specialised investment vehicles, or with respect to the portion of their revenues invested in registered
specialised investment vehicles.

*Administrative procedure*

9        By letter dated 22 October 2003, the Commission called on the Italian authorities to provide information about the measures
provided for in DL 269/2003 and their entry into force, with a view to ascertaining whether they constituted aid within the
meaning of Article 87 EC; it also reminded Italy of its obligation under Article 88(3) EC to notify the Commission.

10      By letters of 11 and 26 November 2003, the Italian authorities provided the information requested. On 19 December 2003, the
Commission again reminded Italy of its obligations under Article 88(3) EC and asked the Italian authorities to inform potential
beneficiaries of the incentives of the consequences provided for under the Treaty and under Article 14 of Council Regulation
(EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article 93 of the EC Treaty (OJ 1999 L
83, p. 1), if the incentives in question were found to constitute aid unlawfully implemented.

11      By letter of 11 May 2004, the Commission informed the Italian Republic of its decision of 7 May 2004 to initiate the procedure
laid down in Article 88(2) EC in respect of the tax incentives granted under Article 12 of DL 269/2003.

12      By letter of 14 July 2004, the Italian authorities submitted their comments to the Commission.

13      On 9 September 2004, the Commission decision to initiate the formal investigation procedure (‘the initiating decision’) was
published in the *Official Journal of the European Union* (OJ 2004 C 225, p. 8).

14      The Associazione italiana del risparmio gestito (‘Assogestioni’) submitted comments by letters of 7 October 2004 and 18 February
2005.

*The contested decision*

15      Commission Decision 2006/638/EC of 6 September 2005 on the aid scheme implemented by Italy for certain undertakings for collective
investment in transferable securities specialised in shares of small- and medium-capitalisation companies listed on regulated
markets (OJ 2006 L 268, p. 1; ‘the contested decision’) sets out, first of all, a description of the procedure leading up
to its adoption (Section I), then of the measure at issue (Section II).

16      In Section II, the Commission begins by outlining the general framework surrounding Article 12 of DL 269/2003. In that context,
it defines investment vehicles as organisms which undertake collective investment in transferable securities (or UCITS) in
the collective interest of third-party investors, and adds that such vehicles may take the form of a contractual investment
fund without legal personality managed by a managing company which is separate in terms of assets (‘fund manager’), or of
a corporate investment fund (such as a SICAV) or a pension fund. It then specifies the specialised investment vehicles for
the purposes of Article 12 of DL 269/2003, before setting out the details of the tax regime applicable to the income of the
various investment vehicles.

17      Next, the contested decision sets out the grounds for initiating the procedure (Section III) and the comments from the Italian
authorities and interested parties (Section IV).

18      The Commission’s assessment (Section V) comprises seven subsections. The Commission begins by stating that the measure at
issue meets all of the cumulative criteria laid down in Article 87(1) EC. It establishes that there is a selective advantage
for, first of all, specialised investment vehicles, then for small- and mid-caps whose shares are held by those specialised
investment vehicles.

19      According to the fourth subsection of Section V of the contested decision, entitled ‘State resources’, the advantages granted
come from the State, in the form of tax revenue – normally paid into the Italian Treasury – which is foregone. The following
subsection deals with the effects of the measure on competition. The Commission observes in that regard that the specialised
investment vehicles compete with other financial undertakings and operate on an open market characterised by substantial intra-Community
trade. It adds that some of the small-caps which benefit from the measure at issue are active in sectors where trade between
Member States takes place.

20      The Commission states, in a sixth subsection entitled ‘Lawfulness of the scheme’, that the Italian authorities implemented
the scheme without first notifying the Commission, with the result that it constitutes unlawful aid.

21      The seventh subsection of the Commission’s assessment contains the assessment as to whether the scheme is compatible with
the common market.

22      The enacting terms of the contested decision state as follows:

‘Article 1

The State aid in the form of tax incentives for undertakings for [specialised investment vehicles] provided for by Article
12 of [DL] 269/2003, unlawfully put into effect by [the Italian Republic] in breach of Article 88(3) [EC], is incompatible
with the common market.

Article 2

The Italian Republic shall withdraw the aid scheme referred to in Article 1 with effect from two months following the date
of notification of the present decision.

Article 3

1.      Within two months of the date of notification of the present decision, the Italian Republic shall inform all the financial
intermediaries, including the [specialised investment vehicles] and all the other parties concerned by the application of
the State aid scheme referred to in Article 1, of the Commission decision deeming the scheme to be incompatible with the common
market.

2.      The Italian Republic shall take the necessary measures to recover the aid referred to in Article 1 and unlawfully made available
to its beneficiaries from the corporate investment vehicles or, as the case may be, from the undertakings managing the contractual
investment vehicles, without prejudice to any subsequent recourse under national law.

Within two months of the date of notification of the present decision, the Italian Republic shall inform the Commission of
the identity of the beneficiaries, the amount of aid granted individually and the methods by which such amounts were determined.

3.      Recovery shall be effected without delay and in accordance with the procedures of national law provided that they allow the
immediate and effective execution of the decision.

4.      The aid to be recovered shall include interest from the date on which it was at the disposal of the beneficiaries until the
date of its recovery.

Interest shall be calculated in accordance with the provisions laid down in Chapter V of Commission Regulation (EC) No 794/2004.

Article 4

The Italian Republic shall inform the Commission, within two months of the date of notification of this decision, of the measures
taken and planned to comply with it. It shall provide this information using the questionnaire attached in Annex 1 of this
decision. It shall submit within the same period all documents showing that the recovery proceedings have been initiated against
the beneficiaries of the unlawful aid.

Article 5

This decision is addressed to the Italian Republic.’

**Procedure and forms of order sought**

23      By application lodged at the Registry of the Court of First Instance on 19 December 2005, Assogestioni and Fineco Asset Management
SpA (‘Fineco’) (collectively, ‘the applicants’) brought the present action against the contested decision.

24      Assogestioni is an association formed to promote the collective interests of asset management undertakings and companies providing
management services. Assogestioni’s members include asset management undertakings which manage specialised UCITSs, such as
Fineco, which come within the scope of Article 12 of DL 269/2003.

25      Fineco is an asset management undertaking incorporated as a company limited by shares. It manages two of the three common
funds specialised in small- and mid-caps which have benefited from the tax measure provided for in Article 12 of DL 269/2003
and which operate in Italy.

26      The applicants claim that the Court should:

–        annul the contested decision in its entirety;

–        in the alternative, annul the contested decision in so far as it orders the recovery of the aid declared incompatible with
the common market;

–        order the defendant to pay the costs.

27      The Commission contends that the Court should:

–        dismiss the action;

–        order the applicants to pay the costs.

**Admissibility**

*Arguments of the parties*

28      Without raising a separate objection of inadmissibility pursuant to Article 114(1) of the Rules of Procedure of the Court
of First Instance, the Commission puts forward in its statement in defence lengthy arguments seeking to establish that the
action brought by the applicants should be held inadmissible.

29      The Commission considers, essentially, that Fineco does not have a legal interest in bringing proceedings because it has not
demonstrated that it has *locus standi* to act on behalf of the beneficiaries of the aid scheme examined in the contested decision, of which it is one. According
to the Commission, the action brought by Assogestioni, in its capacity as an association representing the interests of those
beneficiaries, is also inadmissible.

30      The Commission begins by observing that the contested decision is addressed to the Member State and not to the applicants.
It is therefore appropriate to consider whether the contested decision is of direct and individual concern to them. As it
is, the contested decision is not of individual concern to Fineco, hence not to Assogestioni, either.

31      As the contested decision declares a State aid scheme applicable to an indeterminate number of undertakings to be incompatible
with the common market, it is a measure of general application. The *locus standi* of private persons in relation to measures of general application has been construed very narrowly in the case-law.

32      In the present case, the beneficiary undertakings are unable to rely on individual characteristics or particular circumstances
which are such as to differentiate them from any other undertaking. That analysis is confirmed by the case-law. The Commission
refers to various judgments in that regard, such as the judgment of the Court of Justice in Joined Cases C‐346/03 and C‐529/03
*Atzeni and Others* [2006] ECR I‐1875, paragraphs 32 to 34.

33      The Commission examines various judgments in which actions for annulment were held admissible, including those relied on by
the applicants, and highlights the differences which distinguish those cases from the present case.

34      In particular, the judgment in Joined Cases C‐15/98 and C‐105/99 *Italy and Sardegna Lines* v *Commission* [2000] ECR I‐8855 (‘*Sardegna Lines*’) may be explained by the particular facts of that case, namely that the applicant, Sardegna Lines, was the principal beneficiary
of the aid scheme in question, a fact of which the Commission was aware when it made its findings on the aid scheme.

35      The Commission argues that, in any event, it is necessary to erase the impression which may emerge from some of the earlier
cases that the existence of a recovery order is of decisive importance for the purposes of considering the admissibility of
an action. Such an approach has the effect of placing the actual beneficiaries of a non-notified aid scheme in a more favourable
position in terms of the admissibility of their actions as compared with the potential beneficiaries of a notified aid scheme,
which encourages Member States not to notify aid, thereby undermining the control mechanisms provided for in the Treaty. The
question whether there actually is an obligation to recover the aid from the undertakings can be determined only once certain
verifications – the nature of which is liable to vary according to the circumstances – have been carried out. Moreover, to
allow actions brought by the actual beneficiaries of aid granted under a non-notified aid scheme to be admissible would expose
those undertakings to the risk of subsequently losing all forms of judicial protection before the national courts, pursuant
to the case-law resulting from Case C‐188/92 *TWD Textilwerke Deggendorf* [1994] ECR I‐833. The Commission also draws the Court’s attention to the undesirable practical effects which might ensue
if such actions were to be held admissible, namely a sharp increase in the number of actions where a decision concerns a favourable
tax regime or any other tax reductions benefiting a large number of undertakings.

36      Moreover, the Commission states with respect to Assogestioni that it is an organisation established to promote the collective
interests of its members who, like the members of Fineco, cannot claim to be individually affected by the contested decision,
with the result that the action brought by Assogestioni must also be dismissed as inadmissible.

37      Fineco, on the other hand, submits that the action must be held admissible, as the contested decision concerns it not only
directly but also individually. Fineco is individually affected by the contested decision as an actual beneficiary of the
aid scheme forming the subject-matter of that decision. Moreover, the contested decision was notified to it directly by the
Italian Republic. Fineco adds that it may be distinguished from other potential addressees of the contested decision because,
on the date of the adoption of that decision, two of the investment funds it managed satisfied the eligibility conditions
for the tax measure at issue. Fineco observes that the Court of Justice has acknowledged that if an undertaking has benefited
from an aid measure it may challenge a Commission decision declaring that aid incompatible with the common market, even though
the decision was addressed to the Member State. The same holds true for Commission decisions declaring an aid scheme unlawful,
as evidenced by various judgments.

38      Fineco submits that the case-law relied on by the Commission in support of its contention of inadmissibility cannot be transposed
to the present case.

39      Fineco argues that the Commission is attempting to make the admissibility of these actions subject to an additional condition
not recognised by the case-law, namely the existence of an individual administrative act on the part of the national authorities.

40      Fineco submits that the contested decision is of individual concern to it for another reason, namely that there is a recovery
order which concerns it directly in its capacity as an actual beneficiary of tax relief.

41      Assogestioni, for its part, submits that it defends not only its own interests, but also those of BNL Gestioni and Fineco.
Since the contested decision is of direct and individual concern to those companies, Assogestioni maintains that it has standing
to act on their behalf. Assogestioni adds that it took part, moreover, in the procedure leading up to the adoption of the
contested decision.

*Findings of the Court*

42      Under the fourth paragraph of Article 230 EC, any natural or legal person may institute proceedings against decisions addressed
to that person or against decisions which, although in the form of a regulation or decision addressed to another person, are
of direct and individual concern to the former.

43      In the present case, it is common ground that the decision is addressed to the Italian Republic and not to the applicants.
The Court must therefore determine whether the contested decision is of direct and individual concern to the applicants.

44      The Court finds it appropriate to examine first whether Fineco is individually and directly concerned by the contested decision.

45      It is settled case-law that persons other than those to whom a decision is addressed may claim to be individually concerned
only if the decision affects them by reason of certain attributes peculiar to them or by reason of circumstances in which
they are differentiated from all other persons and if, by virtue of those factors, it distinguishes them individually in the
same way as the person addressed (Case 25/62 *Plaumann* v *Commission* [1963] ECR 95, at p. 107, and *Sardegna Lines*, paragraph 34 above, paragraph 32).

46      Thus, the Court has held that an undertaking cannot, as a general rule, contest a decision of the Commission which prohibits
a sectoral aid scheme if it is concerned by that decision solely by virtue of belonging to the sector in question and being
a potential beneficiary of the scheme. Such a decision is, vis-à-vis the applicant undertaking, a measure of general application
covering situations which are determined objectively and entails legal effects for a class of persons envisaged in a general
and abstract manner (see Case C‐298/00 P *Italy* v *Commission* [2004] ECR I‐4087, paragraph 37 and the case-law cited).

47      It is clear that the contested decision does not identify the undertaking or undertakings in receipt of the aid in question.
Article 1 of the decision declares incompatible with the common market the State aid scheme which the Italian Republic operated
in the form of tax incentives for specialised investment vehicles. The contested decision therefore applies to situations
which are determined objectively, and entails legal effects for a class of persons envisaged in a general and abstract manner,
within the meaning of the case-law cited above.

48      However, it must be borne in mind that, in paragraphs 34 and 35 of *Sardegna Lines*, paragraph 34 above, the Court held that, since the undertaking Sardegna Lines was concerned by the decision at issue in
that case not only as an undertaking in the shipping sector in Sardinia and as a potential beneficiary of the aid scheme for
Sardinian ship owners, but also as an actual recipient of individual aid granted under that scheme, recovery of which had
been ordered by the Commission, it was individually concerned by that decision and its action against the decision was admissible
(Case T‐136/05 *Salvat père & fils and Others* v *Commission*[2007] ECR II-4063, paragraph 69).

49      Accordingly, it is appropriate to determine whether Fineco is an actual beneficiary of individual aid granted under a sectoral
aid scheme, recovery of which has been ordered by the Commission.

50      It is common ground that Fineco is an asset management undertaking and that, in that capacity, it manages two funds specialised
in the shares of small- and mid-caps – namely, Fineco AM Small Cap Italy and Fineco Small Cap Europe – falling within the
scope of Article 12 of DL 269/2003. As manager of those funds, it is required to pay the substitute tax provided for by that
provision, with the result that it benefits from the measure at issue, recovery of which has been ordered. Moreover, the Commission
acknowledged at the hearing that Fineco has already implemented the measure at issue and is, in principle, covered by the
recovery order.

51      Fineco is accordingly the actual beneficiary of individual aid, recovery of which has been ordered. The contested decision
is therefore of individual concern to it.

52      As to the question whether Fineco is directly concerned, in so far as Article 3(2) of the contested decision obliges the Italian
Republic to take the measures necessary to recover the aid referred to in Article 1 thereof, Fineco must be held to be directly
concerned by that decision (see, to that effect, *Sardegna Lines*, paragraph 34 above, paragraph 36, and *Salvat père & fils and Others* v *Commission*, paragraph 48 above, paragraph 75).

53      The two criteria of direct concern which emerge from the case-law – first, the fact that the measure at issue must directly
produce effects on the individual’s legal situation and, secondly, the fact that the measure must not leave any discretion
to the addressees of the measure, who must implement it – are met in the present case (*Salvat père & fils and Others* v *Commission*, paragraph 48 above, paragraph 76).

54      Accordingly, Fineco’s action must be held admissible.

55      According to settled case-law, an association responsible for protecting the collective interests of undertakings is as a
matter of principle entitled to bring an action for the annulment of a final decision of the Commission on State aid only
where the undertakings in question are also entitled to do so individually, or where the association is able to rely on a
particular interest in acting, especially because its negotiating position is affected by the measure which it seeks to have
annulled (see Case T‐55/99 *CETM* v *Commission* [2000] ECR II‐3207, paragraph 23 and the case-law cited).

56      Pursuant to that case-law, since Assogestioni is charged with the task of defending the collective interests of its members
and since at least one of those members – Fineco – has standing to challenge the decision, Assogestioni’s action is also admissible.

**Substance**

*1. The first plea: infringement of Article 253 EC, read in conjunction with Article 88 EC, on grounds of the contradictory
and insufficient statement of reasons for the contested decision*

*Arguments of the parties*

57      By the first part of this plea, the applicants maintain, essentially, that the statement of reasons for the contested decision
is contradictory and insufficient with respect to the issue of selective advantage.

58      The applicants submit, first of all, that the statement of reasons for the contested decision contradicts the line of argument
set out in the initiating decision. In the latter, the Commission referred to a direct advantage for specialised investment
vehicles, consisting in a tax reduction. In the contested decision, however, the Commission, after confirming its initial
position, introduces a new argument to the effect that the measure at issue confers an indirect advantage on specialised investment
vehicles, consisting in liquidity and higher fees.

59      Secondly, after stating in the initiating decision and in recital 36 of the contested decision that the measure at issue confers
an indirect advantage on specialised investment vehicles, the Commission then immediately contradicts itself in recital 37
of the contested decision, according to which beneficiaries of the aid are no longer specialised investment vehicles but rather
SICAVs and fund managers. In that case, however, it is irrelevant to establish whether SICAVs and non-corporate investment
vehicles are undertakings. Nevertheless, in a completely incoherent manner, the Commission states again, in recital 38 of
contested decision, that even non-corporate specialised investment vehicles are undertakings. In recital 45 of the contested
decision, the Commission also states that they compete with other financial undertakings. The Commission thus introduces an
element of confusion between collective investment vehicles and asset management undertakings.

60      That confusion is also to be found in the statement in defence, where, in paragraph 149, the Commission states that purely
contractual investment vehicles are undertakings, after having stated in paragraph 130 thereof that it never regarded funds
without legal personality as being undertakings.

61      The applicants argue, thirdly, that the Commission does not provide reasons to the requisite legal standard to substantiate
its claim that an economic advantage is conferred on small- and mid-caps, even when, in recital 42 of the contested decision,
it describes that hypothetical advantage as consisting in ‘increased demand for their shares and in increased liquidity’.

62      According to the applicants, those considerations make the contested decision self-contradictory and do not enable the persons
concerned to ascertain the reasons for the measure or the competent court to exercise its power of review, in accordance with
the case-law of the Court of Justice and the Court of First Instance.

63      By the second part of this plea, the applicants endeavour to demonstrate that, also as regards the issue whether there is
distortion of competition such as to affect intra-Community trade, the statement of reasons in the contested decision is both
vitiated by contradiction and insufficient.

64      According to the applicants, the reference to the fact that the beneficiary companies may operate on international markets
and pursue commercial activities and other economic activities on markets where competition is intense is merely ‘window-dressing’
disguised as reasons. The Commission failed to explain why the indirect economic advantage granted to the beneficiary companies
is liable to distort competition when the amounts involved are minimal and benefit a large number of companies.

65      The Commission challenges the applicants’ arguments.

*Findings of the Court*

66      It should be borne in mind first that, according to settled case-law, a plea based on infringement of Article 253 EC is a
separate plea from one based on a manifest error of assessment. While the former, which alleges absence of reasons or inadequacy
of the reasons stated, goes to an issue of infringement of essential procedural requirements within the meaning of Article
230 EC and, involving a matter of public policy, must be raised by the Community judicature of its own motion, the latter,
which goes to the substantive legality of a decision, is concerned with the infringement of a rule of law relating to the
application of the Treaty, again within the meaning of Article 230 EC, and can be examined by the Community judicature only
if raised by the applicant. The obligation to state reasons is thus a separate question from that of the merits of those reasons
(Case C-367/95 P *Commission* v *Sytraval and Brink’s France* [1998] ECR I-1719, paragraph 67; Case C-17/99 *France* v *Commission* [2001] ECR I-2481, paragraph 35; Case C‐159/01 *Netherlands* v *Commission* [2004] ECR I-4461, paragraph 65; and Case T-158/99 *Thermenhotel Stoiser Franz and Others*v *Commission* [2004] ECR II‐1, paragraph 97).

67      It is settled case-law that the statement of reasons required by Article 253 EC must be appropriate to the measure at issue
and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted that measure
in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Court to exercise
its power of review. The requirement to state reasons must be assessed according to the circumstances of the case. It is not
necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement
of reasons meets the requirements of Article 253 EC must be assessed with regard not only to its wording but also to its context
and all the legal rules governing the matter in question. In particular, the Commission is not obliged to adopt a position
on all the arguments relied on by the parties concerned; rather, it is sufficient if it sets out the facts and the legal considerations
having decisive importance in the context of the decision (see Case T‐198/01 *Technische Glaswerke Ilmenau* v *Commission* [2004] ECR II‐2717, paragraphs 59 and 60 and the case-law cited).

68      It should be pointed out that, in the case of an aid scheme, the Commission may confine itself to examining the general characteristics
of the scheme in question without being required to examine each particular case in which it applies (*Sardegna Lines*, paragraph 34 above, paragraph 51, and Case C‐278/00 *Greece* v *Commission* [2004] ECR I‐3997, paragraph 24) in order to determine whether that scheme contains elements of aid.

69      It is in the light of those principles that it is appropriate to consider whether the contested decision contains a sufficient
statement of reasons as regards the various aspects raised.

The first part of the first plea: reasons given for the finding of a selective advantage

70      As is apparent from the summary of the contested decision in paragraphs 15 to 22 above, the Commission states, in the description
of the measure at issue, that investment vehicles may take the form of a contractual investment fund without legal personality,
managed by a fund manager, a corporate investment fund (such as a SICAV) or a pension fund (recital 13).

71      In returning to the reasons which led it to initiate the procedure, the Commission states, in recital 29 of the contested
decision, that, in raising doubts as to the possible existence of aid for specialised investment vehicles, it held them to
be ‘undertakings’ within the meaning of Article 87(1) EC because they either have a corporate form and constitute business
entities in themselves or constitute separate assets managed by undertakings that compete on investment markets.

72      In recital 35 of the contested decision, the Commission introduces its assessment of the aid by stating that the tax reduction
for investors constitutes State aid not only for specialised vehicles but also for small- and mid-caps whose shares are held
by those vehicles.

73      It then structures its analysis in accordance with that distinction, by devoting recitals 36 to 41 of the contested decision
to the selective advantage for specialised investment vehicles and recitals 42 and 43 to the selective advantage for the small-
and mid-caps in question.

74      Regarding the specialised investment vehicles, the Commission observes, in recital 36 of the contested decision, that, in
certain cases, investment vehicles are undertakings within the meaning of Article 87 EC and may therefore benefit from the
tax reduction provided for by Article 12 of DL 269/2003. The Commission adds that, even if specialised investment vehicles
do not benefit directly from the tax reduction granted to their investors, they none the less receive an indirect economic
benefit in so far as the measure at issue prompts investors to buy shares in such vehicles, thereby providing additional liquidity
and extra income in terms of management and entry fees.

75      In recital 37 of the contested decision, the Commission takes note of the comment by the Italian authorities to the effect
that the specialised investment vehicles benefiting from the reduced tax pursuant to Article 12 of DL 269/2003 are simply
pools of assets and so cannot be regarded as undertakings within the meaning of Article 87 EC. The Commission notes, however,
that in some cases such investment vehicles take corporate form and may therefore benefit individually. The Commission further
points out that other investment vehicles without legal personality are managed by undertakings which compete with other operators
managing savings and that those undertakings may accordingly benefit from advantages.

76      The Commission goes on to state in recital 38 of the contested decision that it considers that specialised investment vehicles,
whether or not they have corporate form, perform an economic activity and therefore constitute undertakings within the meaning
of Article 87(1) EC. It states that this is confirmed by the case-law of the Court in the field of VAT, according to which
transactions carried out by SICAVs and consisting in collective investment in transferable securities constitute an economic
activity carried out by taxable persons within the meaning of the VAT directives.

77      In recital 39 of the contested decision, the Commission infers from the foregoing that a tax advantage for investors in specialised
investment vehicles favours the vehicles themselves as undertakings when they have corporate form or the undertakings managing
such vehicles when they have contractual form.

78      In recital 40 of the contested decision, the Commission states that the condition of selectivity is fulfilled because the
measure at issue provides for a tax reduction that is extraordinary and limited to the specialised investment vehicles and
their managing undertakings. It adds that, according to the case-law, the fact that the advantage is only indirect cannot
rule out the existence of State aid.

79      The Commission accordingly concludes, in recital 41 of the contested decision, that the measure at issue confers that specific
indirect advantage on specialised investment vehicles and their managing undertakings, to the detriment of other undertakings
offering alternative forms of investment.

80      It is evident from the foregoing that the contested decision contains a statement of reasons for the finding that a selective
indirect advantage had been conferred on specialised investment vehicles. It explains how – even though the manner varies
according to their legal form – the various investment vehicles referred to may be regarded as pursuing an economic activity
and therefore categorised as undertakings within the meaning of Article 87 EC. The undertaking which is the beneficiary of
the advantage is either the investment vehicle itself if it has corporate form, or the undertaking managing it if it has contractual
form.

81      The applicants, however, point to a number of contradictions in the statement of reasons for the contested decision.

82      In that connection, it should be borne in mind that a contradiction in the statement of the reasons on which a decision is
based constitutes a breach of the obligation laid down in Article 253 EC such as to affect the validity of the measure at
issue if it is established that, as a result of that contradiction, the addressee of the measure is not in a position to ascertain,
wholly or in part, the real reasons for the decision and, as a result, the enacting terms of the decision are, wholly or in
part, devoid of any legal justification (Case T‐65/96 *Kish Glass* v *Commission* [2000] ECR II‐1885, paragraph 85).

83      As regards, first, the alleged contradiction between the statement of reasons for the contested decision and the reasons given
for the initiating decision, it is clear that even if there were a divergence in reasons between the two decisions, that would
not mean that the applicants are not in a position to ascertain the reasons for the contested decision, which are apparent
therefrom.

84      Moreover, under Article 6(1) of Regulation No 659/1999, the initiating decision summarises the relevant issues of fact and
law, includes a preliminary assessment on the part of the Commission and sets out the reasons for doubts as to the compatibility
of the measure with the common market. The formal investigation procedure enables a more in-depth examination and clarification
of the questions raised in the initiating decision. It follows from Article 7 of Regulation No 659/1999 that, at the end of
that procedure, the Commission’s analysis may have changed, as it may ultimately decide that the measure does not constitute
aid or that the doubts as to the compatibility of the measure have been removed. It follows that the final decision may contain
certain differences with respect to the initiating decision, without their necessarily vitiating the final decision.

85      In any event, there is no contradiction in the present case between the initiating decision and the contested decision, as
regards either the advantage referred to or the vehicles in question.

86      As regards the indirect advantage conferred on specialised investment vehicles by the measure at issue, the Commission had
already stated in the initiating decision that this could reside in the fact that, by increasing their after-tax income, it
favoured demand on the part of investors for shares in those vehicles. That assessment cannot be regarded as contradictory
to that set out in recital 36 of the contested decision, to the effect that specialised investment vehicles derive an indirect
advantage from the measure at issue ‘in so far as the tax reduction on investments in specialised vehicles prompts investors
to buy shares in such vehicles, thereby providing additional liquidity and extra income in terms of management and entry fees’.
Moreover, the fact that the Commission did not return in the contested decision to the complaint relating to the granting
of a direct advantage to specialised investment vehicles, as conferred through the tax reduction, cannot be regarded as a
contradiction.

87      As regards the investment vehicles at issue, the applicants are also incorrect in arguing that the beneficiaries in question
are no longer specialised investment vehicles, but rather investment vehicles with corporate form or, where those vehicles
are in the form of investment funds, the companies which manage them.

88      First of all, according to the wording of the contested decision, specialised investment vehicles continue to be regarded
as the beneficiaries of the measure at issue, even though it is stated that it is the vehicles themselves that are favoured
where they have corporate form and, where they have contractual form, it is the undertakings which manage them that are favoured
(recital 39).

89      Secondly, in the initiating decision, the Commission had already noted that the tax reductions applied to specialised investment
vehicles could also favour companies managing such funds, which are also undertakings within the meaning of Article 87(1)
EC.

90      The applicants argue, as a second point, that there are various inaccuracies and contradictions in the statement of reasons
for the contested decision.

91      As regards, first, the beneficiaries of the measure at issue and their categorisation as undertakings within the meaning of
Article 87(1) EC, it is clear from recital 35 of the contested decision that the Commission considered that the measure at
issue constitutes State aid for specialised investment vehicles and small- and mid-caps whose shares are held by those vehicles.

92      As regards specialised investment vehicles, it is apparent from recitals 13 and 37 that they may take a number of forms which
are, essentially, for present purposes, the form of a contractual investment fund without legal personality managed by a fund
manager or that of an investment fund established in corporate form, such as a SICAV.

93      It is thus quite logical on the part of the Commission to state, in recital 39 of the contested decision, that the measure
at issue favours the vehicles themselves as undertakings where they have corporate form or the undertakings managing such
vehicles where they have contractual form. Pursuing a consistent approach, the Commission concludes its assessment of investment
vehicles in their various forms by repeating, in recital 41 of the contested decision, that the advantage in question is conferred
on both investment vehicles and their managing undertakings.

94      The applicants – one acting in its capacity as managing undertaking of two funds affected by the measure at issue and the
other as an association representing such managing undertakings – were thus in a position to ascertain the reasons for the
contested decision and to understand how they were themselves covered by that decision.

95      That finding is not called into question by the alleged contradiction in recital 38 of the contested decision.

96      Through its reference to the case-law of the Court of Justice concerning the tax treatment of SICAVs, that recital is clearly
intended to demonstrate that SICAVs are to be categorised as undertakings. Although that demonstration may in some aspects
appear questionable or ambiguous, first, it does not concern the applicants but rather the SICAVs and, secondly and more importantly,
that recital must not be read out of context but in the light of the contested decision as a whole and its enacting terms,
for which it is not, by itself, the only essential ground. Accordingly, that recital cannot be said to call into question
any inferences which the applicants might make in their regard from the reasons for the contested decision, as they emerge,
inter alia, from recitals 13, 29, 36, 37, 39 and 41.

97      As regards, secondly, the failure to state reasons in relation to the selective advantage conferred on small- and mid-caps
whose shares are held by specialised investment vehicles, it is clear that the Commission devotes recitals 42 and 43 of the
contested decision to that point.

98      In recital 42 of the contested decision, the Commission states that the advantage for those companies consists in an increased
demand for their shares and in increased liquidity. The Commission rejects the argument that there would be no advantage for
small- or mid-caps, since funds and investors seek above all to maximise profits. The Commission finds, on the contrary, that
more favourable tax treatment enhances the attractiveness of such an investment, with increased liquidity for small- and mid-caps,
even in the absence of any active behaviour on their part with a view to benefiting from such an advantage.

99      In recital 43 of the contested decision, the Commission then refutes the argument that the measure at issue constitutes a
general tax policy measure designed to favour the capitalisation of small- and mid-caps, which accordingly falls outside the
scope of the rules on State aid.

100    The Commission has thus clearly provided a statement of reasons in the contested decision for its conclusion that there is
a selective advantage for small- and mid-caps whose shares are held by specialised investment vehicles. What is more, the
applicants’ challenge is directed, rather, at the soundness of the reasons given, which, in accordance with the case-law cited
in paragraph 66 above, cannot be contested in the context of the present plea.

101    The first part of the first plea must therefore be rejected.

The second part of the first plea: failure to state reasons for the finding of a distortion of competition which may affect
trade between Member States

102    It should be borne in mind that, although the Commission is required, in the reasons for its decision, to refer at least to
the circumstances in which aid has been granted where those circumstances show that the aid is such as to affect trade between
Member States, it is not required to demonstrate the actual effect of aid already granted. If it were so required, that requirement
would ultimately give Member States which grant unlawful aid an advantage over those which notify aid at the planning stage
(*Technische Glaswerke Ilmenau* v *Commission*, paragraph 67 above, paragraph 215).

103    In the light of that case-law, it does not appear in the present case that the Commission has failed to fulfil its obligation
to give sufficient reasons for the contested decision.

104    In fact, the Commission devotes three recitals of the contested decision to the assessment of the effect of the measure at
issue on competition, first, by explaining how, in its view, the measure at issue distorts competition and affects intra-Community
trade and, secondly, by responding to certain criticisms put forward during the procedure leading up to the adoption of the
contested decision.

105    In recital 45 of the contested decision, the Commission thus states that the measure at issue may distort competition between
undertakings and affect trade between Member States since ‘the beneficiary companies can operate in international markets
and pursue commercial and other economic activities in markets where competition is intense’. It adds that specialised investment
vehicles ‘compete with other financial undertakings and operate in an open market characterised by substantial intra-Community
trade’ and that certain small- and mid-caps are active in sectors where trade between Member States takes place.

106    In recital 46, the Commission rejects the argument relating to the limited tax cost of the measure at issue and the small
number of specialised vehicles operating in 2004, the reference year in the procedure initiated by the Commission in respect
of the measure at issue. It refers, first of all, to settled case-law according to which even a small amount of aid affects
competition. Secondly, it states that the Italian Republic does not rule out the possibility that the measure at issue may
have a far more substantial economic impact in the future. It adds that the limited impact of the measure at issue may also
be explained by the influence of the Commission’s prompt action in the matter on the behaviour of the operators. Lastly, the
Commission states that the information presented by the Italian Republic does not indicate that the benefits accruing to any
individual beneficiary from the measure at issue fall within the limit for *de minimis* aid.

107    The Commission concludes, in recital 47 of the contested decision, that the measure at issue ‘alters (by way of the tax treatment
accorded to investors) the competitive position of certain undertakings pursuing economic activities and, in so far as the
latter operate on markets open to international competition, affects competition’.

108    The statement of reasons for the contested decision thus enables the applicants and the Community judicature to ascertain
the reasons why the Commission reached the conclusion that the conditions for the application of Article 87(1) EC relating
to effect on trade between Member States and distortion of competition were satisfied in the present case.

109    The applicants cannot criticise the Commission for not examining more closely the actual effects of the aid at issue on trade
between Member States and on competition. The Commission was not under a duty to carry out an economic analysis of the actual
situation on the relevant market, or of the market share of the beneficiary undertakings, or of the position of competing
undertakings, or of trade flows between Member States in the services in question, since it had explained how the aid at issue
distorted competition and affected trade between Member States. As the aid had not been notified, the Commission was not required
to establish the actual effects of that aid (see, to that effect, *CETM* v *Commission*, paragraph 55 above, paragraphs 102 and 103).

110    Accordingly, the second part of the first plea, alleging failure to state reasons in the contested decision for the finding
that the measure at issue had effects on competition and on intra-Community trade, is unfounded.

111    The first plea in law must therefore be dismissed in its entirety.

*2. The second plea: infringement of Article 87(1) EC in so far as the measure at issue does not constitute State aid*

*Arguments of the parties*

112    By the first part of their second plea, the applicants submit that the measure at issue does not constitute State aid, but
rather a general tax measure, since it benefits all investors in shares in investment vehicles.

113    The applicants argue, first, that the tax reduction resulting from the measure at issue provides a direct benefit to holders
of shares in investment vehicles. In the case of foreign investment vehicles, that measure consists in the direct reduction
from 12.5% to 5% in the rate of deduction from income for investors in shares in those investment vehicles, whereas in the
case of Italian investment vehicles the same measure, entailing a reduction in the substitute tax rate applicable to those
investment vehicles, results in an immediate and direct increase in the amounts investors may obtain at the time of regular
income distributions or redemption of shares. Moreover, the increase in the investment vehicles’ capital benefits only their
investors and not the managing undertakings. In the case of SICAVs, the applicants state that there can be no increases in
the management fees charged, since the SICAVs entrust other undertakings with the management of their assets. As for specialised
investment vehicles whose seat is outside Italy, the applicants maintain that the management fees are proportional to gross
operating result, without deductions of substitute tax, as those investment vehicles are not subject to substitute tax on
operating result.

114    The applicants observe, secondly, that the investors in question are mostly individuals and not undertakings, with the result
that the finding in the contested decision that the measure at issue constitutes State aid is incorrect.

115    By the second part of their second plea, the applicants submit that no selective economic advantage results from the tax reduction
introduced by the measure at issue for SICAVs and fund managers.

116    The applicants begin by stating that the tax reduction in question does not as such ensure that the undertakings managing
specialised investment vehicles will obtain additional fees. Even if the measure at issue could prompt investment in shares
in specialised investment vehicles, the companies which manage them would not necessarily benefit. Investment in shares in
specialised investment vehicles could in fact give rise to transfers of shares in non-specialised investment vehicles. Where
investment vehicles are managed by the same fund manager, the increase in fees charged for the management of specialised investment
vehicles is offset by the decrease in those charged for the management of non-specialised investment vehicles. It has never
been demonstrated that there is an indirect economic advantage for the companies concerned.

117    The applicants add that the Commission normally takes the view that measures which are favourable to investment vehicles and
funds do not translate into State aid for the undertakings which manage them. The applicants further state that the management
fees represent a cost for the SICAVs, not income.

118    The applicants claim, secondly, that there is no selectivity in the hypothetical advantage conferred on SICAVs and fund managers.
In actual fact, the advantage described by the Commission in the contested decision is accessible to all fund managers, as
they are free to set up investment vehicles which comply with the conditions imposed by the measure at issue. Likewise, existing
funds or SICAVs may act as specialised investment vehicles. In any event, the selectivity of the advantage in question cannot
result from the inability, on the part of undertakings resorting to other types of investment instrument in order to raise
capital, to benefit from the measure at issue. According to the applicants, to see things in that way is to construe too broadly
the concept of selectivity and to stretch the concept of State aid to cover reduced rates of tax which are applicable only
to income from certain types of investment instrument.

119    By the third part of the second plea, the applicants challenge the notion that investment vehicles may be categorised as undertakings.

120    They submit that investment funds are merely pools of assets without separate legal personality. Moreover, since the Commission
acknowledged in the initiating decision that the funds do not produce goods and do not provide any service, it cannot consider
those funds to be undertakings. Furthermore, Council Directive 2003/48/EC of 3 June 2003 on taxation of savings income in
the form of interest payments (OJ 2003 L 157, p. 38) treats income deriving from payments distributed by investment vehicles
as interest and not as operating result.

121    By the fourth part of the second plea, the applicants challenge the finding that the measure at issue gave rise to the granting
of a selective economic advantage for small- and mid-caps whose shares are held by specialised investment vehicles.

122    It is difficult to imagine how a measure for a derisory amount (approximately EUR 600 000), benefiting a large number of companies
(estimated by the applicants as 6 900 companies), can lead to an increase in investments and a corresponding increase in liquidity
for the companies in question. The Commission has in no way demonstrated the alleged effect in the contested decision.

123    In any event, the purpose of the measure at issue is not to increase the liquidity of small-caps, but rather to encourage
investors to diversify their investment portfolios. Assogestioni explicitly challenges the remarks made about it by the Commission
in recital 32 of the contested decision, to the effect that the measure at issue aims to foster the capitalisation of those
companies. Lastly, the applicants submit that the measure at issue does not have the effect of reducing the expenses associated
with investing in the companies in question, which means that it does not give rise to investment aid for fund managers.

124    Even if the measure at issue entailed an indirect economic advantage for small- and mid-caps, the applicants deny the selectivity
of such an advantage, as the situation of those companies is not comparable to that of the other listed companies. Any hypothetical
advantage conferred on listed small- and mid-caps is thus justified by the objective pursued by the measure at issue.

125    The Commission challenges the applicants’ arguments.

*Findings of the Court*

126    By their second plea, the applicants take issue with the substance of the contested decision as regards: the identification
of the beneficiaries of the measure at issue (first part); the conferral of a selective advantage on various categories of
alleged beneficiary (second and fourth parts); and the categorisation of various investment vehicles as undertakings (third
part). It is appropriate to deal with the first and third parts of this plea together.

The identification of the beneficiaries of the measure at issue and their categorisation as undertakings

127    It should be borne in mind that Article 87 EC prohibits aid granted by a State or through State resources in any form whatsoever,
without drawing a distinction as to whether the aid-related advantages are granted directly or indirectly. The case-law has
thus acknowledged that an advantage granted directly to certain natural or legal persons who are not necessarily undertakings
may constitute an indirect advantage, hence State aid, for other natural or legal persons who are undertakings (see, to that
effect, Case C-156/98 *Germany* v *Commission* [2000] ECR I‐6857, paragraphs 22 to 35, and Case C‐382/99 *Netherlands* v *Commission* [2002] ECR I‐5163, paragraphs 38 and 60 to 66).

128    According to recital 35 of the contested decision, ‘the tax reduction for investors constitutes State aid ... for specialised
vehicles investing in shares of [small- and mid-caps]’. In recital 36 of the contested decision, the Commission states that
‘even if specialised investment vehicles do not benefit directly from the tax reduction granted to their investors, they none
the less receive an indirect economic benefit’. It repeats, in recital 39 of the contested decision, that it considers that
a tax advantage conferred on investors investing in specialised investment vehicles favours those vehicles themselves.

129    Moreover, it emerges from recital 42 of the contested decision that, according to the Commission, the measure at issue confers
an indirect selective advantage on small- and mid-caps whose shares are held by specialised investment vehicles, consisting
in increased demand for their shares and increased liquidity.

130    It is accordingly apparent from the contested decision that, although the Commission did not find that investors are the direct
beneficiaries of the measure at issue, it categorised that measure as State aid in relation to its indirect beneficiaries
which, in its view, are specialised investment vehicles and small- and mid-caps.

131    Moreover, in keeping with the case-law cited in paragraph 127 above, the fact that – as the applicants state – the measure
at issue cannot constitute State aid for investors in specialised investment vehicles does not prevent it from being categorised
as such in relation to undertakings which are only the indirect beneficiaries of the measure. It is not necessary, in order
to found a finding of the existence of intervention by means of State resources in favour of an undertaking, that the undertaking
must be the direct beneficiary (Case T‐93/02 *Confédération nationale du Crédit mutuel* v *Commission* [2005] ECR II‐143, paragraph 95).

132    Accordingly, the Commission did not err in law in assessing the measure at issue in relation to its indirect beneficiaries.

133    It follows that the applicants’ line of argument seeking to show the absence of State aid in terms of there being direct beneficiaries
of the measure at issue has no bearing on the issue. It is not in relation to direct beneficiaries that the conditions laid
down in Article 87(1) EC must be satisfied, but rather in relation to the indirect beneficiaries.

134    In that context, before determining whether there is an advantage in their favour, it is appropriate to consider – as the
applicants invite the Court to do by the third part of this plea – whether the Commission was entitled to categorise the various
indirect beneficiaries concerned as undertakings.

135    In that regard, it is clear that the contested decision distinguishes between two scenarios (see recitals 13, 29, 37 and 39,
and paragraphs 75, 77, 92 and 93 above). In certain cases, those investment vehicles have corporate form and may themselves
benefit, as undertakings, from the advantage in question. In other cases, those vehicles do not have legal personality, but
are managed by undertakings which are favoured within the meaning of Article 87 EC. Accordingly, even though the specialised
investment vehicles referred to in Article 12 of DL 269/2003 are, as the applicants argue, mere pools of assets without legal
personality, it is, according to the contested decision, the undertakings which manage them which derive an indirect benefit
from the advantage in question. Neither the existence of the companies which manage those contractual investment funds without
legal personality, nor their categorisation as undertakings, has been disputed. It follows that the measure at issue indeed
favours undertakings within the meaning of Article 87(1) EC.

136    In any event, it should be borne in mind that, since the present case concerns a State aid scheme, the Commission could legitimately
confine itself to examining the general characteristics of the scheme at issue, without being required to examine each particular
case in which it applies (see the case-law cited in paragraph 68 above). The Court of Justice has held that it is sufficient,
for the purposes of applying Article 87(1) EC to an aid scheme, that the scheme benefit certain undertakings, a finding not
called into question by the fact that it may also benefit entities which are not undertakings (see, to that effect, Case C-66/02
*Italy* v *Commission* [2005] ECR I‐10901, paragraphs 91 and 92). Accordingly, the Commission could legitimately confine itself to showing that
in certain cases the investment vehicles are undertakings (recital 36 of the contested decision).

137    The first and third parts of the second plea are therefore unfounded.

The existence of a selective advantage in favour of the specialised investment vehicles or of the undertakings which manage
them

138    It should be borne in mind that, inter alia, measures which, in various forms, mitigate the charges which are normally borne
by the budget of an undertaking and which, therefore, without being subsidies in the strict sense of the word, are similar
in character and have the same effect, are considered to be aid (see, inter alia, Case C‐75/97 *Belgium* v *Commission* [1999] ECR I‐3671, paragraph 23, and Case C‐387/92 *Banco Exterior de España* [1994] ECR I‐877, paragraph 13).

139    It is apparent from recital 36 of the contested decision that specialised investment vehicles are conferred an indirect advantage,
since the tax reduction on investments in specialised vehicles prompts investors to buy shares in those vehicles, thereby
providing them with additional liquidity and extra income in terms of management and entry fees. In recital 39 of the contested
decision, the Commission repeats that the increased demand for shares in specialised investment vehicles leads to an increase
in the management and entry fees charged by the vehicles or by the undertakings managing them.

140    The applicants nevertheless dispute the existence even of such an advantage in favour of specialised investment vehicles and
the undertakings managing them.

141    As regards the argument that solely the skill of the undertakings managing specialised investment vehicles enables them to
earn extra fees, it is clear that, as acknowledged by the applicants themselves, the measure at issue tends to encourage investors
to invest in shares in that type of investment vehicle. As it is not disputed that fees are paid in proportion to the volumes
concerned where investments are made in shares and/or funds managed, even though the details may vary, the increase in shares
purchased will inevitably lead to an increase in the management and entry fees charged by those vehicles or by the undertakings
managing them, as stated by the Commission in recital 39 of the contested decision. The applicants’ argument is therefore
unfounded.

142    As to the argument alleging an offsetting between any increase in the fees charged for the management of specialised investment
vehicles and the decrease in those charged for the management of non-specialised investment vehicles, the Court notes, first,
that the Commission, in recital 36 of the contested decision, referred to both management fees and entry fees. The applicants’
line of argument refers only to management fees, however. Secondly, although it is possible that in certain cases there may
well be an offsetting of management fees as alleged by the applicants, there is nothing to indicate that it will be automatic
and thus cancel out in all cases the advantage conferred by the measure at issue.

143    In any event, the fact that the advantage conferred by the measure at issue may sometimes be cancelled out is not sufficient
in itself to preclude its being categorised as an advantage for the purposes of Article 87(1) EC. It is sufficient that the
measure at issue lead to an increase in demand for shares in specialised investment vehicles, hence of the management and
entry fees charged by those vehicles or by the undertakings managing them, for those undertakings to be favoured within the
meaning of Article 87(1) EC, independently of the condition of selectivity. It is irrelevant in that regard whether the figure
representing the total of the fees charged by those undertakings before the adoption of the measure at issue, all vehicles
and all transactions taken together, actually increased or is liable to increase.

144    It should also be noted that, when the applicants observe that management fees are a cost for the SICAVs because they are
paid to the companies managing them, they are endorsing the argument put forward by the Commission to the effect that, when
a specialised investment vehicle is managed by a managing undertaking, it is the latter which derives the benefit of the measure
at issue in the form of an increase in management and entry fees (see recital 39 of the contested decision).

145    Nor, lastly, is the applicants’ line of argument concerning the Commission’s decision-making practice any more convincing.
It should be borne in mind that the concept of State aid must be applied to an objective situation, which falls to be appraised
on the date on which the Commission takes its decision (Joined Cases C‐182/03 and C‐217/03 *Belgium and Forum 187* v *Commission* [2006] ECR I‐5479, paragraph 137), the sole test being whether a State measure confers an advantage on one or more particular
undertakings (Joined Cases T‐228/99 and T‐233/99 *Westdeutsche Landesbank Girozentrale and Land Nordrhein-Westfalen* v *Commission* [2003] ECR II‐435, paragraph 180). Accordingly, the Commission’s decision-making practice in the area, with which the parties
moreover disagree, cannot be a decisive factor.

146    Thus, none of the arguments put forward by the applicants to disprove the existence of an advantage for specialised investment
vehicles or the undertakings managing them is well founded.

147    The applicants also deny that the measure at issue is selective in respect of those vehicles or undertakings.

148    As is apparent from the terms of Article 87(1) EC, an economic benefit granted by a Member State constitutes State aid only
if, by displaying a degree of selectivity, it is such as to favour ‘certain undertakings or the production of certain goods’.
For the purposes of applying that provision, the only question to be determined is whether, under a particular statutory scheme,
a State measure is such as to favour ‘certain undertakings or the production of certain goods’ within the meaning of Article
87(1) EC as compared with other undertakings which are in a legal and factual situation that is comparable in the light of
the objective pursued by the measure at issue (see Case C‐143/99 *Adria-Wien Pipeline and Wietersdorfer & Peggauer Zementwerke* [2001] ECR I‐8365, paragraphs 34 and 41 and the case-law cited).

149    According to the case-law of the Court of Justice, a measure which, although conferring an advantage on its recipient, is
justified by the nature or general scheme of the system of which it is part does not satisfy that condition of selectivity
(*Adria-Wien Pipeline and Wietersdorfer & Peggauer Zementwerke*, paragraph 148 above, paragraph 42).

150    As regards, first, specialised investment vehicles which are companies and can themselves benefit, as undertakings, from the
advantage at issue (see above, paragraph 135), as indicated by the description in recitals 11 to 19 of the contested decision
and the explanation provided in recital 40 thereof, the measure at issue provides for a tax reduction ‘limited to [specialised
investment vehicles] and their managing undertakings’. As it is intended to be limited to well-defined investment vehicles
which fulfil specific conditions ‘to the detriment of other undertakings offering alternative forms of investment’ (recital
41 of the contested decision), it favours certain investment vehicles as compared with others which are in a comparable legal
and factual situation as contemplated in the case-law cited in paragraph 148 above. The measure at issue is therefore selective
for the purposes of Article 87(1) EC.

151    Viewed in that light, the applicants’ argument that the advantage deriving from the measure at issue is available for any
investment vehicle fulfilling the conditions laid down, with the result that it is a general measure, is not convincing.

152    The mere fact that the advantage may benefit any investment vehicle fulfilling the conditions laid down does not suffice to
establish that the measure at issue is general in scope and does not preclude the measure at issue from being selective in
nature (see, to that effect, Joined Cases T‐92/00 and T‐103/00 *Diputación Foral de Álava and Others* v *Commission* [2002] ECR II‐1385, paragraph 58).

153    It follows that the measure at issue confers a selective advantage on certain specialised investment vehicles and thus falls
within the scope of Article 87(1) EC. This finding is not affected by the fact that some of the beneficiaries of the aid scheme
at issue here are not undertakings (see paragraph 136 above). Accordingly, those considerations are in any event sufficient
reason to reject the second part of the second plea.

154    For the sake of completeness, it should be observed, as regards more specifically those specialised investment vehicles which
do not have legal personality, that the Commission takes the view that the measure at issue favours managing undertakings,
whose status as undertakings is not disputed (see, inter alia, recitals 37 and 39 of the contested decision). What is more,
it is clear that the condition of selectivity is also fulfilled in their case, in accordance with the case-law cited in paragraph
148 above.

155    It should be noted that aid may be selective for the purposes of Article 87(1) EC even if it concerns a whole economic sector
(*Italy* v *Commission*, paragraph 136 above, paragraph 95).

156    In the present case, the measure at issue applies to the financial sector. Within that sector, it benefits only the undertakings
carrying out the operations covered by that measure. As it does not apply to all economic operators, it cannot be regarded
as a general measure of fiscal or economic policy. It is, in fact, an exception to the general tax scheme. The beneficiary
managing undertakings derive an indirect benefit from advantages not provided for under the normal rules of that scheme and
to which undertakings in the financial sector which do not perform management operations for specialised investment vehicles
have no right (see, to that effect, *Italy* v *Commission*, paragraph 136 above, paragraphs 96, 97, 99 and 100). The measure at issue is thus also selective in respect of managing
undertakings of specialised investment vehicles.

157    That finding is not affected by the fact that certain fund managers may benefit from the advantage afforded by the measure
at issue for some of their activities but not for others. The fact nevertheless remains that the measure at issue confers
an advantage on them for certain specific activities, whereas other, non-specialised fund managers will not benefit from it.

158    It follows from the foregoing considerations that the second part of this second plea must be rejected.

The existence of an indirect selective advantage in favour of listed small- and mid-caps whose shares are held by specialised
investment vehicles

159    It is clear from recital 42 of the contested decision that the Commission considers that the measure at issue confers an indirect
selective advantage on small- and mid-caps whose shares are held by specialised investment vehicles, consisting in increased
demand for their shares and in increased liquidity owing to the enhanced attractiveness of the investment.

160    The applicants dispute that the measure at issue can lead to such increases. Not only does such an assertion lack credibility,
given the derisory amount allocated by the Italian Republic to the measure at issue in relation to the large number of companies
concerned, it is not proved in the contested decision, either.

161    As to the link which the applicants attempt to establish between the amount allocated to the measure at issue by the Italian
authorities and the number of small- and mid-caps, it should be noted that it does not displace the link referred to in the
contested decision (recital 42) between the enhanced attractiveness of investment in those companies and their increase in
liquidity.

162    It should be noted in that regard that the Italian Republic has argued that the measure at issue is designed to foster the
market capitalisation of small- and mid-caps as opposed to other companies listed in Europe (recital 32 of the contested decision).
In its rejoinder in the present case, the Commission even reproduced an excerpt from the application of the Italian authorities
in Case T-424/05, from which it transpires that the grant of tax reductions to institutional investors having an interest
in small- and mid-caps has the effect of mitigating the negative effects of reduced capitalisation on the undertakings’ growth
prospects, as large capitalisation favours company growth. Admittedly, the applicants assert that the objective behind the
measure at issue was not to increase the liquidity of those small- and mid-caps. They also state, however, that the measure
at issue was aimed at prompting investors to diversify their portfolio by acquiring shares in specialised investment vehicles
and, correlatively, to encourage fund managers to expand their product range. However, even though the objective of the measure
at issue was not that alleged by the Italian Republic, its author, but rather the objective imputed to it by the applicants,
the fact remains that, in the eyes of investors, it enhanced the attractiveness of the investments in those companies and
that, by increasing demand for their shares, it afforded the latter an advantage.

163    Moreover, the Court has previously held that a measure allowing the undertakings concerned to increase their own resources
on more favourable terms may constitute State aid (see, to that effect, *Germany* v *Commission*, paragraph 127 above, paragraph 34). A mere increase in liquidity can therefore – contrary to the applicants’ claim – constitute
an advantage within the meaning of Article 87(1) EC.

164    Equally unconvincing is the applicants’ argument that SICAVs or fund managers operate according to a logic of maximum profit
and not according to whether there might be tax reductions. First of all, there is no conflict between those two rationales,
since any tax reductions as a rule increase profit. Secondly, if the measure at issue attains the objective imputed to it
by the applicants – namely, to encourage fund managers to expand their product range – then clearly it influences their approach,
thus triggering an increase in the demand for shares in small- and mid-caps.

165    Consequently, the Commission is correct in concluding, in recital 42 of the contested decision, that, by favouring investor
demand for shares in small- and mid-caps, the measure at issue confers an indirect advantage on those companies.

166    It is apparent, however, from the case-law cited in paragraphs 148 and 149 above, first, that the assessment of the selectivity
of a measure necessitates a comparison of the situation of the beneficiary undertakings with that of other undertakings which
are in a legal and factual situation that is comparable in the light of the objective pursued by the measure at issue and,
secondly, that a measure which constitutes an advantage does not fulfil the condition of selectivity if it is justified by
the nature or general scheme of the system of which it is part.

167    The applicants submit, however, that the situation of listed small- and mid-caps is not comparable to that of larger companies
and that, moreover, limiting the measure to the former is not a selective criterion because it is justified by the objective
pursued.

168    As to the first argument, it is clear that the applicants have not adduced any evidence to establish the impossibility of
comparing the situation of collective investment in small- and mid-caps with that of collective investment in other companies,
or even that of individual investments. In particular, the fact that it is precisely large-capitalisation companies which
have considerable capitalisation at their disposal and are already heavily present on the markets and in the portfolios of
investment vehicles does not by itself preclude their being compared with small- and mid-caps. Moreover, when the applicants
argue that the measure at issue is aimed at prompting investors to diversify their investment portfolio and to encourage fund
managers to expand their product range, they are implicitly acknowledging that shares in small- and mid-caps and in other
companies, such as large- capitalisation companies, are investments and products which may form part of the same portfolio.
If the measure at issue is such as to encourage investors to re-establish balance in their portfolio, it is because, in their
eyes, investments in small- and mid-caps are comparable with those in other companies and are therefore liable to attract
investors provided that they see an advantage in them, such as that afforded them by the measure at issue.

169    As regards the second argument, the Commission examined it in recital 43 of the contested decision. It states in that recital
that the tax advantage conferred does not offset any substantial disparity in tax treatment between collective investments
in listed small- and mid-caps, on the one hand, and collective investments in other companies and individual investments in
non-listed companies, on the other. Nor may the measure at issue be justified by its specific objective because it provides
solely for tax reductions in the case of specialised collective investments in shares of small- and mid-caps and, as such,
it is not targeted at or proportionate to the aim of promoting the capitalisation of such companies but instead is conditional
on the investments being made through specialised investment vehicles.

170    The applicants have not adduced any evidence to support their assertion that the measure at issue is justified by the objective
it pursues, which, in their view, is to guarantee that investors diversify their investment portfolio by investing in shares
in specialised investment vehicles and, according to the Italian authorities, is to favour the capitalisation of those companies.
It should be borne in mind in that regard that, if it were to be considered that a specific measure could escape Article 87(1)
EC if it pursued an economic or industrial policy objective, such as the promotion of investment, that provision would have
no practical effect. In accordance with settled case-law, it must therefore be held that the objective pursued by the measure
at issue cannot enable it to escape being categorised as State aid within the meaning of Article 87(1) EC (*Diputación Foral de Álava and Others* v *Commission*, paragraph 152 above, paragraph 51).

171    Lastly, it should be observed that this part of the plea – even if it were well founded – would not be sufficient by itself
to entail the annulment of the contested decision, because that decision also covers specialised investment vehicles or their
managing undertakings.

172    Accordingly, the fourth part of the second plea is also unfounded, and the second plea must therefore be rejected in its entirety.

*3. The third plea: in the alternative, infringement of Article 87(2)(a) EC and Article 88 EC in that the Commission found
the measure at issue to be incompatible with the common market*

*Arguments of the parties*

173    The applicants put forward the third plea by way of an alternative, should the Court find that the measure at issue constitutes
State aid. In their view, the measure at issue satisfies the two conditions laid down in Article 87(2)(a) EC. In the first
place, it is a measure having a social character in favour of investors. In the second place, it does not discriminate between
domestic and Community financial products. The social character of the measure at issue derives from the fact that it is intended
to create a vehicle to enable small savers to acquire shares in companies which would otherwise not be easily accessible to
them.

174    In any event, the judgment of the Court of First Instance of 14 December 2005 in Case T‐200/04 *Regione autonoma della Sardegna* v *Commission*, not published in the ECR, relied on by the Commission, is not relevant because, in the passage cited, the Court was addressing
a plea alleging failure to conduct a proper preliminary investigation.

175    The Commission challenges the applicants’ arguments.

*Findings of the Court*

176    As regards determining, first, whether the recipient of aid can rely on facts and documents which have not been brought to
the attention of the Commission prior to the adoption of its decision and, second, whether pleas based on such facts and documents
are admissible, it should be borne in mind that, according to settled case‐law, in an action for annulment brought under Article
230 EC, the lawfulness of a Community measure must be assessed on the basis of the information existing at the time when the
measure was adopted. In particular, the complex assessments made by the Commission must be examined solely on the basis of
the information available to it at the time when the assessments were made. In this respect, the Commission cannot be reproached
for not taking into account information which could have been submitted to it during the administrative procedure but which
was not, since it is under no obligation to consider, of its own motion and on the basis of prediction, what information might
have been submitted to it (see Case T‐217/02 *Ter Lembeek* v *Commission* [2006] ECR II‐4483, paragraphs 82 and 83 and the case-law cited).

177    The Court of First Instance has inferred from this that, where an applicant has participated in the formal investigation procedure
provided for in Article 88(2) EC, it may not rely before the Court on factual arguments which are unknown to the Commission
and which have not been notified to the latter during the formal investigation procedure. On the other hand, there is nothing
to prevent the interested party from raising against the final decision a plea in law not raised at the stage of the administrative
procedure (*Ter Lembeek* v *Commission*, paragraph 176 above, paragraph 84).

178    Accordingly, the applicants may not, at this stage, rely on factual material of which the Commission was unaware at the time
of the adoption of its decision and which the applicants did not notify to the latter during the formal investigation procedure.
However, there is nothing to prevent them from relying, in the present action, on infringement of Article 87(2)(a) EC, even
though they did not explicitly dispute the assessment set out by the Commission in the initiating decision and relating to
the inapplicability of the exceptions provided for in Article 87(2) and (3) EC.

179    In the assessment of the merits of this plea, it should be borne in mind as a preliminary point that, since Article 87(2)(a)
EC provides for an exception from the general principle laid down in Article 87(1) EC that State aid is incompatible with
the common market, it must be narrowly construed (see, to that effect, *Germany* v *Commission*, paragraph 127 above, paragraph 49).

180    In recital 52, the contested decision expressly rules out the applicability of the exception relied on by the applicants.

181    The wording of Article 87(2)(a) EC makes it clear that the application of that exception is conditional upon the aid having
a social character, being granted to individual consumers and there being, in that context, no discrimination relating to
the origin of the products.

182    However, although it is common ground that the aid was granted without discrimination relating to the origin of the investment
vehicles concerned, it is aimed at all categories of investors, whose taxes or charges are reduced. Accordingly, the measure
at issue has no social character. The Commission was therefore correct to rule out the application of the exception provided
for in Article 87(2)(a) EC.

183    The third plea must therefore be rejected.

*4. The fourth plea: in the further alternative, infringement of Article 88 EC and Article 14 of Regulation No 659/1999 in
so far as the Commission ordered the recovery of the aid from investment vehicles having corporate form and from undertakings
which manage the investment vehicles on a contractual basis*

*Arguments of the parties*

184    By this plea, put forward in the further alternative, should the Court not annul the contested decision in its entirety, the
applicants seek annulment of the recovery order, in so far as it relates to investment vehicles having corporate form and
undertakings which manage the investment vehicles on a contractual basis.

185    According to the applicants, the unlawfulness of the recovery order results, in the first place, from the fact that the actual
beneficiaries of the measure at issue are not the same as the persons referred to in the recovery order, namely the specialised
Italian SICAVs and the Italian fund managers managing specialised funds. Under Article 88 EC and Article 14 of Regulation
No 659/1999, the recovery order may concern only the direct and actual beneficiaries of the aid. As it is, the Commission
acknowledged, inter alia, in recital 42 of the contested decision that the only actual beneficiaries of the measure at issue
are the investors, with specialised investment vehicles benefiting only indirectly.

186    The applicants submit that it is disproportionate to require the SICAVs and fund managers concerned to pay an amount reflecting
the reduction in the substitute tax rate applied to operating result, when the advantage that they obtained consisted in an
increase in the fees charged. It is not open to the Commission to require the restitution of an amount which does not correspond
to the amount of the advantage which actually accrued to the undertakings. By ordering the restitution of a disproportionate
amount, the Commission has infringed Article 14(1) of Regulation No 659/1999, under which ‘the Commission shall not require
recovery of the aid if this would be contrary to a general principle of Community law’. The applicants add that they are not
arguing that the recovery order is in itself disproportionate.

187    The applicants submit, secondly, that execution of the recovery order would place the specialised Italian SICAVs and the Italian
fund managers managing specialised funds in a less favourable position than that in which they would have been had it not
been for the measure at issue, since payment of the tax relief equivalent is a charge which they would not otherwise have
had to bear. Moreover, they are unable to pass that charge on to investors. The imposition of such an additional charge is
therefore contrary to the case-law requiring a return to the *status quo ante* through recovery of the aid unlawfully paid.

188    Thirdly, the applicants maintain that the Italian authorities are not in a position to enforce the recovery ordered in respect
of specialised investment vehicles established in another Member State – be it SICAVs or fund managers managing funds – with
the result that the recovery order in question is not only unlawful but also impossible to implement, thereby giving rise
to discrimination depending on where the specialised investment vehicles are established.

189    The Commission challenges the applicants’ arguments.

*Findings of the Court*

190    Article 14(1) of Regulation No 659/1999 provides that, where negative decisions are taken in cases of unlawful aid, the Commission
is to decide that the Member State concerned is to take all necessary measures to recover the aid from the beneficiary. The
Commission is not to require recovery of the aid if this would be contrary to a general principle of Community law.

191    It should be borne in mind that removing unlawful aid by means of recovery is the logical consequence of a finding that the
aid is unlawful, the purpose of which is to re-establish the previous situation (Case C‐277/00 *Germany* v *Commission* [2004] ECR I‐3925, paragraph 74, and Case T‐318/00 *Freistaat Thüringen* v *Commission* [2005] ECR II‐4179, paragraph 308).

192    The main objective pursued in requiring the repayment of unlawfully paid State aid is to eliminate the distortion of competition
caused by the competitive advantage afforded by the unlawful aid (Case C‐277/00 *Germany* v *Commission*, paragraph 191 above, paragraph 76; Joined Cases T‐111/01 and T‐133/01 *Saxonia Edelmetalle and Others* v *Commission* [2005] ECR II‐1579, paragraph 114; and *Freistaat Thüringen* v *Commission*, paragraph 191 above, paragraph 310).

193    Recovery with a view to re-establishing the previously existing situation cannot, in principle, be regarded as disproportionate
to the objectives of the Treaty provisions on State aid. By repaying, 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 (Case C-372/97 *Italy* v *Commission* [2004] ECR I‐3679, paragraphs 103 and 104, and Case C-148/04 *Unicredito Italiano* [2005] ECR I‐11137, paragraph 113).

194    With regard to aid of a fiscal nature, the Court of Justice has held that re-establishing the *status quo ante* means restoring, as far as possible, the situation which would have prevailed if the operations in question had been carried
out without the tax reduction. That does not imply reconstructing past events differently on the basis of hypothetical elements
such as the choices, often numerous, which could have been made by the operators concerned, since the choices actually made
with the benefit of the aid might prove to be irreversible (*Unicredito Italiano*, paragraph 193 above, paragraphs 117 and 118).

195    It is in the light of those principles that the fourth plea must be examined.

196    Article 3(2) of the contested decision, in the authentic Italian version, requires the Italian Republic to take the necessary
measures to recover the aid made unlawfully available to its beneficiaries from the corporate investment vehicles or, as the
case may be, from the undertakings managing the contractual investment vehicles, without prejudice to any subsequent recourse
under national law.

197    Recital 60 of the contested decision states that the Italian Republic must recover the aid from the investment vehicles or
from the undertakings managing contractual investment vehicles that are at the same time the first beneficiaries of the aid
and the persons required by tax legislation to pay to the State the substitute tax on their operating result. The aid to be
recovered corresponds to the difference between the standard substitute tax and the reduced tax resulting from the tax incentives
in question. According to the wording of recital 60, the Commission does not rule out the possibility that the investment
vehicles or the undertakings that manage them may claim a corresponding amount from their investors, if such a possibility
exists under national law. The Commission adds that it is possible that all or part of the aid granted to individual beneficiaries
may fall within the scope of the provisions applicable to *de minimis* aid.

198    It is clear, first of all, that specialised investment vehicles or the fund managers which manage them are indeed the beneficiaries
of the measure at issue – as indicated in paragraphs 127 to 132 and 138 to 146 above – which means that the applicants are
incorrect in alleging infringement of Article 88 EC and Article 14 of Regulation No 659/1999 in so far as the contested decision
orders the Italian Republic to recover the aid from persons other than those identified as the beneficiaries in the contested
decision. On this point, it should be emphasised that neither the Treaty nor Regulation No 659/1999 draws a distinction, for
the purposes of the recovery to be carried out by the Member State concerned, according to whether a party is a direct or
an indirect beneficiary of the unlawful aid in question.

199    However, the applicants argue that, under the contested decision, the specialised investment vehicles or the fund managers
which manage them are required to give back something which is entirely different from the advantage which, according to the
Commission, they had derived. They would have to repay an amount corresponding to the tax relief of which they are not the
direct beneficiaries, whereas, according to the Commission, their advantage consists in an increase in their entry and management
fees. The principle of proportionality is therefore infringed.

200    In that regard, recital 60 of the contested decision indicates that recovery is to be effected from specialised investment
vehicles or the fund managers which manage them, both as indirect beneficiaries of the aid and as persons required by tax
legislation to pay the substitute tax.

201    In their capacity as taxpayers, the specialised investment vehicles or the fund managers which manage them are the only possible
interlocutors for the Italian Republic in the context of proceeding with recovery of the unlawful aid. The restoration of
the previous situation, which would have prevailed if the operations in question had been carried out without the tax reduction,
accordingly calls for the recovery from those bodies of the difference between the standard tax and the reduced tax resulting
from the measure at issue, even though they always have the option of subsequently effecting recovery in turn from their investors
or even from the State, in accordance with the provisions of national law.

202    Moreover, given their status as beneficiaries of the unlawful aid in question, the recovery of that aid from the specialised
investment vehicles or the fund managers which manage them cannot be regarded as disproportionate in the light of the case-law
cited in paragraphs 192 to 194 above. It is in fact the tax relief in question, recovery of which is ordered, which caused
a distortion of competition in favour of the specialised investment vehicles or the undertakings managing them in relation
to other investment vehicles.

203    The argument that, once recovery has been carried out, the specialised investment vehicles and the fund managers which manage
them will find themselves in a less favourable position than if they had not benefited from the measure at issue must also
be rejected. It would not be right to determine the amounts to be repaid in the light of various operations which could have
been implemented by the undertakings if they had not opted for the type of operation which was coupled with the aid (*Unicredito Italiano*, paragraph 193 above, paragraph 114).

204    Secondly, in any event, it should be noted that even if the practical difficulties referred to by the applicants were genuine,
they would not be such as to call into question the validity of the recovery order, which concerns, without discrimination,
all the specialised investment vehicles or the companies which manage them.

205    The present plea must therefore be rejected and, in consequence, the action must be dismissed in its entirety.

**Costs**

206    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. As the applicants have been unsuccessful, they must be ordered to pay the
costs, in accordance with the form of order sought by the Commission.

On those grounds,

THE COURT OF FIRST INSTANCE (Fifth Chamber)

hereby:

1.      **Dismisses the action.**

2.      **Orders the applicants to pay the costs.**

| Vilaras | Dehousse | Šváby |
| ------- | -------- | ----- |

Delivered in open court in Luxembourg on 4 March 2009.

[Signatures]

Table of contents

Background to the dispute

Measure at issue

Administrative procedure

The contested decision

Procedure and forms of order sought

Admissibility

Arguments of the parties

Findings of the Court

Substance

1. The first plea: infringement of Article 253 EC, read in conjunction with Article 88 EC, on grounds of the contradictory
and insufficient statement of reasons for the contested decision

Arguments of the parties

Findings of the Court

The first part of the first plea: reasons given for the finding of a selective advantage

The second part of the first plea: failure to state reasons for the finding of a distortion of competition which may affect
trade between Member States

2. The second plea: infringement of Article 87(1) EC in so far as the measure at issue does not constitute State aid

Arguments of the parties

Findings of the Court

The identification of the beneficiaries of the measure at issue and their categorisation as undertakings

The existence of a selective advantage in favour of the specialised investment vehicles or of the undertakings which manage
them

The existence of an indirect selective advantage in favour of listed small- and mid-caps whose shares are held by specialised
investment vehicles

3. The third plea: in the alternative, infringement of Article 87(2)(a) EC and Article 88 EC in that the Commission found
the measure at issue to be incompatible with the common market

Arguments of the parties

Findings of the Court

4. The fourth plea: in the further alternative, infringement of Article 88 EC and Article 14 of Regulation No 659/1999 in
so far as the Commission ordered the recovery of the aid from investment vehicles having corporate form and from undertakings
which manage the investment vehicles on a contractual basis

Arguments of the parties

Findings of the Court

Costs

---

- Language of the case: Italian.