Judgment — ECLI:EU:C:2002:524
Date: 2002-09-24
Based on: Treaty establishing the European Coal and Steel Community (1951)
Subject matter: State aids;Competition;Steel industry;ECSC matters
Concepts: Investments and financial aid;Application ratione temporis;Legal certainty;Appeals;Principle of proportionality;Implementation of the Commission decision and recovery
Procedure: Action for annulment - unfounded;Appeal - unfounded;Appeal - successful
Origin: Italy

Summary of the Judgment 
1. Appeal — Admissibility — Appeal governed by the ECSC Statute — Intervener 
other than the Member States and the institutions — Absence of status of undertaking 
within the meaning of Article 80 of the ECSC Treaty — Irrelevant — Need to be 
directly affected by the decision of the Court of First Instance 
(ECSC Statute of the Court of Justice, Art. 34, first para., Art. 49, second para.) 
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2. ECSC — Steel aid — Administrative procedure — Obligation of the Commission to 
give notice to the interested parties to submit their comments — Right of the aid 
recipient to be heard — Limits 
(EC Treaty, Art. 93(2) (now Art. 88(2), EC); General Decision No 3855/91, Art. 6(4) 
3. ECSC — Steel aid — Prohibition — Trade between Member States affected — 
Irrelevant 
(ECSC Treaty, Art. 4(c)) 
4. ECSC — Steel aid — Authorisation by the Commission — Conditions — Notifi­
cation — Failure to observe time-limits — Effects 
(General Decisions Nos 257/80, 3484/85, 3855/91 and 2496/96) 
5. Acts of the institutions — Temporal scope — Retroactive effect of a substantive 
rule — Conditions — Non-retroactivity of steel aid code rules 
(ECSC Treaty, Arts 2, 3, and 4; General Decision No 3855/91) 
6. ECSC — Steel aid — Administrative procedure — No rule prescribing a limitation 
period for the exercise by the Commission of its powers — Observance of the 
requirements of legal certainty 
7. State aid — Recovery of illegal aid — Breach of the principle of proportionality — 
None — Payment of interest justified by the need to restore the situation previously 
obtaining — Fixing of the interest rate — Powers of the Commission 
8. ECSC — Steel aid — Commission decision — Legality to be assessed in the light of 
the information available when the decision was adopted — Member State granting 
the aid and the recipient thereof to be diligent as regards the communication of all 
relevant information 
(General Decision No 3855/91, Art. 6(4)) 
9. ECSC — Steel aid — Recovery of unlawful aid — Sale of the company in receipt of 
aid — Obligation to repay — Seller liable — Whether permissible 
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FALCK AND ACCIAIERIE DI BOLZANO v COMMISSION 
1. Under the second paragraph of 
Article 49 of the ECSC Statute an 
appeal may be brought by interveners 
other than the Member States and the 
Community institutions where the 
decision of the Court of First Instance 
directly affects them. Any natural or 
legal person who has been granted 
leave to intervene in a case at first 
instance under the first paragraph of 
Article 34 of the ECSC Statute of the 
Court of Justice does not therefore 
need to demonstrate that it is an 
undertaking, within the meaning of 
Article 80 of the Treaty, which could, 
if necessary, initiate proceedings under 
the second paragraph of Article 33 of 
the ECSC Treaty in order to appeal 
against a decision of the Court of First 
Instance in that case. 
However, the difference, in so far as 
intervention by natural or legal persons 
is concerned, between the wording of 
the second paragraph of Article 49 and 
that of the first paragraph of Article 34 
of the ECSC Statute of the Court of 
Justice, which merely requires a proven 
interest in the resolution of the dispute 
to be shown, means that it is not 
sufficient to fulfil that latter condition 
and to have been granted leave to 
intervene in the case at first instance 
in order to bring an appeal, but that the 
appellant must be directly affected by 
the decision of the Court of First 
Instance. 
(see paras 53-55) 
2. During the examination stage provided 
for under Article 6(4) of the Fifth Steel 
Code, established by Decision 
No 3855/91 and governed by provi­
sions similar to those of Article 93(2) of 
the Treaty (now Article 88(2) EC) as 
regards the participation of the inter­
ested parties in the procedure, the 
Commission must give notice to the 
interested parties to submit their com­
ments. 
In that regard, publication of a notice 
in the Official Journal of the European 
Communities is an appropriate means 
of informing all the parties concerned 
that a procedure has been initiated. 
That communication is intended to 
obtain from persons concerned all 
information required for the guidance 
of the Commission with regard to its 
future action. Such a procedure also 
guarantees to the other Member States 
and the sectors concerned an oppor­
tunity to make their views known. 
However, in the procedure for review­
ing State aid, interested parties other 
than the Member State responsible for 
the grant of aid cannot themselves seek 
to engage in an adversarial debate with 
the Commission in the same way as is 
offered to the abovementioned 
Member State. In that regard, no 
special role is reserved to the recipient 
of aid, among all the interested parties, 
by any provision of the procedure for 
reviewing State aid, in particular of 
that provided for by the Fifth Steel Aid 
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SUMMARY — JOINED CASES C-74/00 P AND C-75/00 P 
code, since that procedure is not initi­
ated against the recipient or recipients 
on which it or they could rely which 
are as extensive as the rights of the 
defence as such. 
(see paras 79-80, 82-83) 
3. Contrary to Article 92(1) of the EC 
Treaty (now, after amendment, 
Article 87(1) EC), which, only in so 
far as it affects trade between Member 
States, concerns aid granted by a 
Member State or through State 
resources in any form whatsoever 
which distorts or threatens to distort 
competition by favouring certain 
undertakings or the production of 
certain goods, Article 4(c) of the ECSC 
Treaty purely and simply concerns aid 
granted by States in any form what­
soever. 
That clear difference between the 
wording of the ECSC Treaty and that 
of the EC Treaty suffices to show that, 
so far as concerns State aid, the 
Member States did not seek to adopt 
the same rules or the same scope of 
action for the Communities and that, in 
order to be caught by the provisions of 
Article 4(c) of the ECSC Treaty, an aid 
measure does not necessarily need to 
have an effect on trade between 
Member States or on competition. 
The fact that, on the basis of Article 95 
of the ECSC Treaty, the Commission, 
with the unanimous assent of the 
Council of the European Union and 
after consultation with the Consult­
ative Committee, adopted provisions 
for the authorisation of certain aid 
within the scope of that Treaty is not 
such as to alter the definition of aid as 
laid down in Article 4(c) thereof. 
(see paras 101-103) 
4. Unlike the provisions of the EC Treaty 
on State aid, which permanently 
empower the Commission to adopt 
decisions on its compatibility, the steel 
aid codes confer such power on the 
Commission only for a specified period 
only. Accordingly, where aid which a 
Member State wishes to authorise 
under a code is not notified during 
the period laid down by it for such 
notification, the Commission can no 
longer give a decision on the compati­
bility of that aid under that code. The 
fact that the Commission or its services 
were able, where appropriate, to take a 
different position in certain cases is not 
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FALCK AND ACCIAIERIE DI BOLZANO v COMMISSION 
such as to call in question that con­
clusion. Moreover, the compatibility of 
aid with the common market can be 
assessed, in the context of steel aid 
codes, only in the light of the rules in 
force on the date on which it is actually 
paid. 
(see paras 115-117) 
5. The principle of legal certainty pre­
cludes a Community measure from 
taking effect from a point in time 
before its publication save where, 
exceptionally, the purpose to be 
achieved so demands and where the 
legitimate expectations of those con­
cerned are duly respected. In that 
regard, in order to ensure observance 
of the principles of legal certainty and 
the protection of legitimate expec­
tations, the substantive rules of Com­
munity law must be interpreted as 
applying to situations existing before 
their entry into force only in so far as it 
clearly follows from their terms, objec­
tives or general scheme that such effect 
must be given to them. 
The Fifth Steel Code contains no 
provision which provides that it may 
be applied retroactively. Moreover, it is 
clear from the general scheme and the 
objectives of successive aid codes that 
each of them lays down rules for the 
adaptation of the steel industry to the 
objectives laid down in Articles 2, 3 
and 4 of the ECSC Treaty according to 
the needs existing at any given period. 
Accordingly, application of rules 
adopted at a particular period, accord­
ing to the then prevailing situation, to 
aid paid in the course of an earlier 
period does not correspond to the 
general scheme and objectives of that 
type of rules. 
(see paras 119-120) 
6. In order to fulfil their function, limi­
tation periods must be fixed in 
advance, the fixing of their duration 
and the detailed rules for their appli­
cation coming within the powers of the 
Community legislature. However, the 
latter has not taken steps to prescribe a 
limitation period concerning the review 
of aid granted under the ECSC Treaty. 
None the less, in the absence of any 
provision in that regard, the funda­
mental requirement of legal certainty 
has the effect of preventing the Com­
mission from indefinitely delaying the 
exercise of its powers. 
(see paras 139-140) 
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7. Article 93(2) of the EC Treaty gives the 
Commission, when it has found that 
aid is incompatible with the common 
market and decides that the State 
concerned must cancel or alter it, the 
power to require its repayment where 
such aid has been granted in breach of 
the Treaty, which makes it possible for 
such cancellation or modification to be 
of practical effect. The recovery of 
State aid unlawfully granted seeks to 
restore the previously existing situation 
and cannot in principle be regarded as 
disproportionate to the objectives of 
the Treaty in regard to State aid. 
However, the previously existing situ­
ation cannot of necessity be restored 
unless repayment of the aid bears 
interest running from the date of pay­
ment of the aid and the interest rates 
applied are representative of the rates 
of interest charged on the market. 
Otherwise, the recipient would at the 
very least retain an advantage amount­
ing to an interest-free government 
advance or subsidised loan. Thus, the 
recipients of State aid incompatible 
with the common market cannot claim 
that it is unexpected of the Commission 
to ask for repayment of that aid 
together with interest as representative 
as possible of that sought on the 
capitals market. 
In that regard, the procedure provided 
for under domestic law is applicable to 
the recovery of amounts unduly paid 
only in the absence of Community 
provisions. Having the power to order 
that the previous situation be restored, 
the Commission, subject to review by 
the Community judicature as to any 
manifest error of assessment, has 
power to determine the rate of interest 
enabling such restoration to be 
effected. 
(see paras 157, 159-161) 
8. The legality of a decision concerning 
aid is to be assessed in the light of the 
information available to the Commis­
sion when the decision was adopted. 
In that connection, since the decision to 
initiate the procedure provided for by 
Article 6(4) of the Fifth Code contains 
an adequate preliminary analysis by the 
Commission setting out the reasons for 
the doubts it entertains regarding the 
compatibility of the aid in question 
with the common market, it is for the 
Member State concerned and, where 
appropriate, the recipient of the aid, to 
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FALCK AND ACCIAIERIE DI BOLZANO v COMMISSION 
put forward arguments to show that 
the aid is compatible with the common 
market and, if necessary, plead special 
circumstances relating to recovery of 
the aid already paid should the Com­
mission require such repayment. 
(see paras 168, 170) 
9. Where a company in receipt of aid is 
sold at a market price, the purchase 
price reflects in principle the advan­
tages corresponding to the aid paid 
previously and it is the seller of that 
company that keeps the benefit of the 
aid through the price received. In those 
circumstances, it is not aberrant that, 
in a proper case, liability to repay aid 
incompatible with the common market 
paid to a company which was sub­
sequently sold should, in the end, 
attach to the vendor, in respect of 
whom such a situation cannot be said 
to be in the nature of a penalty. 
(see paras 180-181) 
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