Judgment — ECLI:EU:T:2018:6
Date: 2018-01-16
Language of the case: French
Court formation: Third Chamber
Subject matter: State aids;Competition
Procedure: Action for annulment - unfounded
Origin: France

summary sheet’ which gave an ‘update on the negotiations with the State’. 329 The ‘summary sheet’ sent under cover of the letter of 9 February 1996 states, under the heading ‘Strengthening the top part of EDF’s balance sheet’, the following: ‘The current restructuring involves three steps: – incorporating the capital contributions made by the State into capital in the strict sense; – incorporating into the capital the contributions made by (or on behalf of) the State in the context of the RAG concession and the provisions established in connection with that concession. This operation will eliminate the quite subtle distinction between the State’s capital contributions and its contributions by way of concession; – the wiping out of the accumulated accounting deficit which is currently jeopardising EDF’s net asset position. These measures should bolster the company’s financial position, bringing the capital up from FRF 2.6 billion to FRF 85 billion and the net asset position up from FRF 20 billion to FRF 90 billion, which is more in line with its assets, and thus present an image comparable to that of the other European electricity companies. … Presenting own capital of close to a hundred billion French Francs and with clearer descriptions of its concessions, EDF will then have a balance sheet that better reflects the company’s financial position.’ 330 The letter of 9 February 1996 mentions neither the grantor rights nor the waiver of the tax payable on their incorporation into the capital. 331 It must therefore be held that the letter of 9 February 1996 is entirely irrelevant and neither constitutes nor contains economic evaluations comparable to those which a private investor would have had carried out before implementing the measure at issue in order to determine its future profitability. 332 Lastly, the French Republic mentions the strategic plan which it allegedly took into account when it adopted the measure at issue. In its view, such a plan is generally taken into account when the private investor test is applied. 333 The strategic plan is a document of 36 pages which presents, to the entire staff of the company it appears, the company’s future direction and the steps to be carried out up to 1998. 334 The strategic plan makes no mention of either the French State’s waiver of the tax due on the grantor rights, or the grantor rights, or the provisions relating to the RAG concession, or the ownership of the RAG, its accounting and fiscal position, or even the recapitalisation of EDF which was the subject of Law No 97-1026. 335 The strategic plan therefore appears to be entirely irrelevant and neither constitutes nor contains economic evaluations comparable to those which a private investor would have had carried out before implementing the measure at issue in order to determine its future profitability. 336 In addition, without it being necessary to rule on the admissibility of a simple reference to a table set out in an annex to the statement in intervention, which sets out extracts from documents, some of them annotated, that are not mentioned in the statement in intervention, it must be observed that none of the passages cited and none of the comments appearing in the table set out in Annex 12 to the statement in intervention refers to the measure at issue. 337 Consequently, the fourth part of the second principal plea in law must be dismissed in its entirety. 7. The fifth part of the second principal plea in law (a) Arguments of the parties 338 EDF, supported by the French Republic, asserts, essentially and conclusively, that, as is demonstrated by the arguments which it put forward in support of its first two principal pleas in law, the Commission was wrong to conclude that the private investor test was not applicable in this case. Indeed, an objective, unbiased analysis of the nature and subject matter of the measure, its context and the objective which it pursued, and the rules to which it is subject should have led the Commission to conclude that the test was applicable to the measure at issue. 339 As regards the nature and subject matter of the measure at issue, it was a measure for the recapitalisation of EDF by the French Republic, which was sole shareholder. 340 As regards the context in which the measure was adopted, this was clearly described in paragraphs 9 to 36 of the judgment in Case T‑156/04. In 1997, it was characterised by the impending opening up to competition of the European electricity market. In that context, EDF’s ability to react to this liberalisation and to take advantage of international investment opportunities was restricted by the state of its balance sheet. 341 As regards the objective pursued, the purpose of Law No 97-1026 was ‘to restructure EDF’s balance sheet and to increase its own funds’ and it pursued the ‘objective of recapitalising EDF’, according to the judgment in Case T‑156/04 (paragraphs 243 and 247). 342 Lastly, as regards the rules applicable to the measure, given that it was a recapitalisation of EDF, whose capital was defined by legislation, it could only have been implemented by legislation, as the General Court acknowledged in paragraph 252 of its judgment in Case T‑156/04. 343 EDF concludes that, by adopting Law No 97-1026, the purpose of which was to recapitalise the company, the French Republic conducted itself as a shareholder would have done, as is demonstrated, it alleges, by the contemporaneous documents that were sent to the Commission, and the Commission should have recognised that the private investor test was applicable. 344 The Commission disputes these arguments. (b) Findings of the General Court 345 EDF, supported by the French Republic, asserts, essentially and conclusively, that, as is demonstrated by the arguments which it put forward in support of its first principal plea in law and the first four parts of its second principal plea in law, the Commission was wrong to conclude that the private investor test was not applicable in this case. An objective, unbiased analysis of the nature and subject matter of the measure, its context and the objective which it pursued, and the rules to which it is subject should have led the Commission to conclude that the test was applicable to the measure at issue. 346 The arguments put forward by EDF and the French Republic in reality seek to establish the applicability of the test merely on the basis of factors relating to the nature and subject matter of the measure, its context and the objective which it pursued, and the rules to which it is subject. 347 However, for the reasons set out in relation to the first four parts of the second principal plea in law, those matters are not sufficient to demonstrate the applicability of the private investor test. Indeed, EDF and the French Republic have adduced no evidence that establishes unequivocally that, before or at the same time as conferring the advantage (the waiver of tax on the reclassification of the grantor rights as a capital contribution), the French Republic had taken the decision to make an investment, by means of that measure, in EDF and that, when it adopted that decision, the French Republic had evaluated, as a private investor would have done, the profitability of the investment consisting in the grant to EDF of that advantage. 348 Consequently, the fifth part of the second principal plea in law must also be dismissed. 8. Conclusion regarding the second principal plea in law 349 The present plea must consequently be dismissed in its entirety. C. The third plea in law 350 The third principal plea in law alleges infringement of Article 107 TFEU as a result of various errors which the Commission allegedly made when examining the conditions for the application of the private investor test. 351 However, it must be remembered that, in the contested decision, the Commission concluded that the private investor test was not applicable in the present case and that it was only in the alternative that it went on to analyse the conditions for the application of the test. 352 Since EDF has not demonstrated that the Commission was wrong to conclude that the private investor test was inapplicable, on account of which the second plea must be dismissed, the third plea in law must be dismissed as ineffective. D. The fourth plea in law 1. Arguments of the parties 353 EDF argues that, the Commission having failed in its duty to take into consideration all the relevant evidence for the purposes of its analysis of the advantage, a matter which it demonstrated with its first three pleas in law, the Commission also failed in its duty to state reasons. EDF takes issue with the Commission for having disregarded, without explanation, evidence which demonstrated that the measure at issue was not any supposed decision not to tax the grantor rights, as well as evidence casting light on the method that should have been used in applying the private investor test. 354 The Commission disputes this line of argument. 2. Findings of the General Court 355 It has been consistently held that the statement of reasons must be appropriate to the measure concerned and the context in which the measure was adopted. It must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure, in such a way as to enable the Court to carry out its review and to enable the persons concerned to ascertain the reasons for the measure so that they can defend their rights and ascertain whether or not the measure is well founded. It is not necessary for the statement of reasons to specify all the relevant matters of fact or of law, since the question whether the statement of reasons for a measure satisfies the requirements of the second paragraph of Article 296 TFEU must be assessed with regard not only to its wording but also to its context and to 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, but it is sufficient if it sets out the facts and the legal considerations having decisive importance in the context of the decision (see judgment of 6 March 2003, Westdeutsche Landesbank Girozentrale and Land Nordrhein-Westfalen v Commission, T‑228/99 and T‑233/99, EU:T:2003:57, paragraphs 278 to 280). 356 EDF takes issue with the Commission for having disregarded, in breach of its duty to state reasons, evidence which demonstrated that the measure at issue was not a decision not to tax the grantor rights. 357 Nevertheless, it must be observed that, in recitals 23 to 35, 74 and 112 to 123 of the contested decision, the Commission explained the reasons for which it had concluded, on the basis of the evidence communicated by the French Republic, and in particular the memorandum of 9 April 2002 (see recital 35 of the decision), that the waiver of tax on the reclassification of the grantor rights as a capital contribution constituted an advantage conferred on EDF. The contested decision is therefore not vitiated by any breach of the duty to state reasons in this regard. 358 EDF also takes issue with the Commission for having disregarded, in breach of its duty to state reasons, evidence casting light on the method that should have been used in applying the private investor test. 359 Since the Commission examined the conditions for applying the private investor test only in the alternative, and since it did not err in concluding that the test was not applicable in the present case, EDF’s arguments on this point must be declared ineffective. 360 Consequently, the fourth principal plea in law must be dismissed as partly unfounded and as partly ineffective. E. The first plea in law put forward in the alternative 361 The first plea in law put forward in the alternative alleges that certain aid should have been classified as existing aid and alleges infringement of Article 1(b)(v) and of Article 15(1) of Regulation No 659/1999. 1. The contested decision Recital 215 of the contested decision states the following: ‘The Commission also considers that, contrary to what is claimed by the French authorities, the rule on limitation periods does not apply in the case in point. Admittedly, EDF created the accounting provisions free of tax between 1987 and 1996. However, it should be pointed out, firstly, that corrections to accounting errors, which by their very nature relate to the posting of past transactions, should according to the National Accountancy Council be posted in the accounts for the financial year in which they are discovered and, secondly, that the [law] providing that the grantor rights were to be reclassified as capital contributions without being subject to corporation tax dates from 10 November 1997. The tax concession therefore dates from 1997 and any new aid paid on that date is therefore not time-barred because the first Commission instrument concerning this measure dates from 10 July 2001. Furthermore, under Article 15 of Regulation … No 659/1999, legal proceedings suspend the period of limitation.’ 2. The first part of the plea, alleging infringement of Article 1(b)(v) of Regulation No 659/1999 (a) Arguments of the parties 362 EDF considers that the measure at issue, if it is to be classified as aid, should nevertheless be classified as existing aid. 363 EDF maintains that, in accordance with Article 1(b)(v) of Regulation No 659/1999, aid that has been implemented in a sector that was originally closed to competition is existing aid, which description ceases to apply only on the date fixed for the liberalisation of the sector. 364 EDF considers that the solution adopted by the General Court in paragraph 143 of its judgment of 15 June 2000, Alzetta and Others v Commission (T‑298/97, T‑312/97, T‑313/97, T‑315/97, T‑600/97 to T‑607/97, T‑1/98, T‑3/98 to T‑6/98 and T‑23/98, EU:T:2000:151), may be applied in the present case. Indeed, the electricity sector was liberalised by Directive 96/92/EC of the European Parliament and of the Council of 19 December 1996 concerning common rules for the internal market in electricity (OJ 1997 L 27, p. 20), which entered into force on 19 February 1997 and provided for a transposition period ending on 19 February 1999. The directive was not, however, transposed by the French Republic until 10 February 2000. 365 EDF maintains that, accordingly, any measure adopted or implemented before that date, supposing it qualifies as State aid, must necessarily be regarded as existing aid and cannot therefore be made the subject of a recovery order. That, EDF alleges, applies to Law No 97-1026, which was adopted 15 months before the expiry of the transposition period laid down in the directive, no national measure to transpose the directive having been adopted before that law. 366 The Commission disputes this line of argument. (b) Findings of the General Court 367 It is important to remember that, as is stated in recital 4 of Regulation No 659/1999, ‘in order to ensure legal certainty, it is appropriate to define the circumstances under which aid is to be considered as existing aid; … the completion and enhancement of the internal market is a gradual process, reflected in the permanent development of State aid policy; … following these developments, certain measures, which at the moment they were put into effect did not constitute State aid, may since have become aid’. 368 Article 1(b)(v) of Regulation No 659/1999 provides that existing aid includes aid which is deemed to be an existing aid because it can be established that at the time it was put into effect it did not constitute an aid, and subsequently became an aid due to the evolution of the common market and without having been altered by the Member State and that, where certain measures become aid following the liberalisation of an activity by Community law, such measures are not to be considered as existing aid after the date fixed for liberalisation. 369 In accordance with Article 1(b)(v) of Regulation No 659/1999, the date on which an activity is liberalised by Community law must therefore be taken into consideration for the sole purpose of ensuring that, after that date, a measure which did not constitute aid before the liberalisation by Community law should not be classified, subsequently, as existing aid. However, the fact that a date for liberalisation has been fixed in a directive such as that in issue in this case is not sufficient to prevent a measure from being classified as new aid if, by reference to market developments, it can be proven that the measure was adopted on a market that was already open, wholly or partly, to competition before the date set for the liberalisation of the activity in question by Community law (see, to that effect, judgment of 4 April 2001, Regione Autonoma Friuli-Venezia Giulia v Commission, T‑288/97, EU:T:2001:115, paragraph 95). 370 In recitals 196 to 204 of the contested decision, the Commission explained — and this is not disputed by EDF, which had put forward a plea on the point in the action which gave rise to the judgment in Case T‑156/04, a plea which was dismissed by the General Court in paragraphs 134 to 155 of that judgment — that the aid had been granted in a sector which was being progressively opened up to competition and in which, even before 1997, EDF had been exporting electricity to other Member States, had been operating through subsidiaries on markets for services that were open to competition, had been in actual or potential competition with other operators on the European Union electricity market in other Member States and had competed in France with suppliers of other energy sources, such as gas. 371 That being so, the measure at issue cannot be regarded as a pre-existing measure that did not constitute aid when it was implemented and only became aid following market developments toward the end of the period for the transposition of Directive 96/92. 372 The first part of the first plea put forward in the alternative must therefore be dismissed as unfounded. 3. The second part of the plea, alleging infringement of Article 15(1) of Regulation No 659/1999 (a) Arguments of the parties 373 EDF points out, first of all, that the complexity and uncertainty which had beset the question of the ownership of the RAG were resolved by Article 4(1) of Law No 97-1026, which states that the structures of the RAG are to be deemed to have been owned by EDF from the time it was granted the concession for that network. 374 EDF submits that it must therefore be concluded, as the Commission concluded in the opening decision (paragraphs 45, 49 and 52), that, by the establishment of renewal provisions from 1987 to 1996, it had in reality benefited from an undue tax advantage each year from 1987 to 1996, one that was only partly cancelled out by the accounting adjustments and reclassifications carried out in 1997. 375 The Commission’s first step in the preliminary investigation was taken on 10 July 2001 and consequently no provision established before 10 July 1991 may be taken into account in the calculation of the measure from which EDF benefited, given the limitation period laid down in Article 15(1) of Regulation No 659/1999. 376 In such case, the value of grantor rights established after 10 July 1991 that could be classified as new aid amounts to only FRF 7.976 billion out of a total of FRF 14.119 billion. 377 EDF also claims that, between the opening decision and the contested decision, the Commission altered its analysis of the measure at issue so as to circumvent the limitation period. In its view, it is clear from the opening decision that the aid was put in place each year from 1987 onwards. In the contested decision, the Commission referred to the concept of consolidation of the aid, taking the view that the non-taxation of the provisions previously established constituted aid on the date of that non-taxation, that is to say, in 1997. 378 EDF argues that, in the opening decision, which provided the basis for the contested decision (see recital 52 thereof), it was in fact assumed that a selective advantage had been conferred on the company over the period 1987 to 1996 and it was stated that the value of that advantage was the ‘difference between the capitalised value of the unpaid corporation tax on the provisions during the same period and the amount of corporation tax paid by EDF in 1997, following the entry into force of Article 4 of [Law] No 97-1026’. 379 However, the calculation method finally adopted in the contested decision is not based on the difference between the capitalised value of the unpaid corporation tax on the provisions during the same period and the amount of corporation tax paid by EDF in 1997. In recital 220 of the decision, the Commission instead referred to the sum ‘paid in the form of exemption from corporation tax in the amount of FRF 5 882 849 762 relating to the reclassification of part of the provisions to the tune of FRF 14 119 065 335 as capital’. 380 Moreover, in this way the Commission disregarded the concept of existing aid, classifying as new aid a measure that only partly cancelled out the advantages conferred previously (paragraph 49 of the letter appended to the opening decision). 381 Finally, EDF argues, in essence, that the Commission cannot rely on a national accounting rule in order to contest its line of argument regarding the existence of new aid. 382 The Commission disputes these allegations. (b) Findings of the General Court 383 EDF maintains, in substance, that a large part of the aid falls outside the limitation period, inasmuch as, in the opening decision (paragraphs 45, 49 and 52), the Commission took the view that, by the establishment of renewal provisions from 1987 to 1996, EDF had in reality benefited from an undue tax advantage each year from 1987 to 1996, one that was only partly cancelled out by the accounting adjustments and reclassifications carried out in 1997, whereas, in the contested decision, the Commission deliberately altered its analysis and took the view that the advantage had been consolidated by Law No 97-1026. 384 First of all, it must be remembered that, in the reorganisation of EDF’s balance sheet, the French authorities had followed the opinion of the National Accountancy Council, which stated that corrections to accounting errors, which by their very nature relate to the posting of past transactions, ‘are to be posted in the profit and loss account for the financial year in which they are discovered’. That much is not disputed by the French Republic. 385 It must also be observed that it is clear from the letter of 22 December 1997 (see paragraph 23 above) that, as regards the ‘renewal provisions which have become unwarranted (FRF 38 520 943 408) [that is to say, the unused provisions, these were reclassified] as retained income, in accordance with [the National Accountancy Council Opinion]’. 386 Finally, it must be borne in mind that, in the memorandum of 9 April 2002 (Annex D.2 to the rejoinder), the French authorities stated that ‘the grantor rights [corresponding to used renewal provisions] in respect of the RAG [represented] an unowed debt [from EDF to the State, as it was shown in the balance sheet] which was unjustifiably exempted from tax by being incorporated into the capital’. The memorandum went on to state that, ‘since the RAG constituted own assets, EDF had no debt obligation towards the State to return those assets, with the result that the corresponding amounts posted in the item “Grantor rights” [constituted] not actual liabilities, but a non-tax-exempt reserve’ and that ‘under those circumstances, before that reserve was incorporated into the capital, it should have been transferred from the enterprise’s liabilities, where it was incorrectly posted, to a net assets account, thereby resulting in a positive variation in net worth that was taxable … The tax advantage thus obtained [could] be assessed at [FRF] 5.88 [billion] (14.119 x 41.67%).’ Those figures are further clarified in a footnote: ‘Normal rate of corporation tax (31.33%) increased by the additional contributions in force for the financial years ending between 1 January 1997 and 1 January 1999’. 387 There is consequently no doubt that the reclassification of the grantor rights as capital, which took place on 1 January 1997, was the taxable event. 388 That being so, the limitation period had not expired, since the Commission’s first step in the preliminary investigation was taken on 10 July 2001. 389 Secondly, for the sake of completeness, it must be recalled that, in accordance with Article 4 of Regulation No 659/1999, the Commission must initiate a formal investigation procedure, and inform interested parties thereof, if, on completion of a preliminary examination, it has doubts about the compatibility of the financial measure in question with the internal market. It follows that, in its notice of intention to initiate that procedure, the Commission cannot be required to present a complete analysis of the aid in question, but it is sufficient for it to define sufficiently the framework of its investigation so as not to render meaningless the right of interested parties to put forward their comments (see the judgment in Case T‑156/04, paragraph 108 and the case-law cited). 390 It should also be remembered that, in accordance with Article 6(1) of Regulation No 659/1999, where the Commission decides to initiate the formal investigation procedure, it is permissible for its decision merely to summarise the relevant issues of fact and law, include a preliminary assessment as to the aid character of the State measure in question and set out its doubts as to the measure’s compatibility with the internal market (see the judgment in Case T‑156/04, paragraph 109 and the case-law cited). 391 Thus, a decision to initiate the procedure must give interested parties the opportunity effectively to participate in the formal investigation procedure, during which they will have the opportunity to put forward their arguments. For that purpose, it is sufficient for the parties concerned to be aware of the reasoning which has led the Commission to conclude provisionally that the measure in issue might constitute new aid incompatible with the internal market (see the judgment in Case T‑156/04, paragraph 110 and the case-law cited). 392 It follows that the analysis of a measure given in an opening decision is a provisional analysis, one that may be refined or corrected by the Commission in its final decision. 393 The analysis of the measure at issue given in the opening decision in the present case was therefore not final and the Commission was entitled to refine and correct that analysis in the contested decision. 394 It must also be pointed out that, in paragraph 71 of the letter appended to the opening decision, the Commission had in any event already expressed the view that ‘the reclassifications and accounting adjustments which [had] consolidated part of the advantage EDF had gained by the improper creation of provisions for the renewal of the high-voltage RAG [had been] recorded in 1997, following the adoption by the French Parliament of Article 4 of Law No 97-1026 of 10 November 1997’, that ‘the aid element, consisting in the capitalised value of the advantage not cancelled out by these reclassifications and adjustments [had] therefore [been] consolidated with the approval of the French authorities in the course of the ten-year limitation period laid down in Article 15(3) of Regulation No 659/1999 and in breach of Article 88(3) of the Treaty’ and that ‘that aid element therefore [constituted] new aid’. 395 Thirdly and lastly, the argument concerning the question whether the aid was new aid put forward in support of this part of the present plea is confused, as to the remainder, with the argument which EDF put forward in support of the first part of the plea, and it must consequently be dismissed, having regard to paragraphs 367 to 372 above. 396 The second part of the first plea put forward in the alternative must therefore be dismissed. F. The second plea in law put forward in the alternative 1. Arguments of the parties 397 In support of the first part of the plea, EDF maintains that the Commission arrived at the figure of FRF 56 886 million by adding together the total value of the unused renewal provisions in the 31 December 1996 balance sheet (FRF 38 520 million) and the sums reclassified as own capital (FRF 18 345 million). However, in its view, the total value of the renewal provisions established during the period 1987 to 1996 was FRF 47 943 million, allocated as follows: FRF 9 423 million to grantor rights on the occasion of the renewal works carried out on the RAG structures between 1987 and 1996 and the balance of FRF 38 520 million to a reserve account, without flowing through the profit and loss account when the balance sheet was restructured. 398 EDF states that the difference between the total reclassified as own capital (FRF 18 345 million) and the use of the renewal provisions allocated to grantor rights (FRF 9 423 million) is attributable to revaluation differences (FRF 4 226 million) and the funding by the grantor of certain RAG structures (FRF 4 696 million) during the period 1987 to 1996. 399 In support of the second part of the plea, EDF argues that the rate of corporation tax that should have been applied in order to calculate the reimbursement is the 1996 rate, not the 1997 rate. Article 1 of Law No 97-1026 introduced a new contribution additional to corporation tax equal to 15% of that tax for the financial years ending between 1 January 1997 and 31 December 1998, which therefore had not existed previously. Only the additional contribution of 10% of the corporation tax was in force. 400 EDF alleges that the corrections that were made when the balance sheet was restructured were assessed to corporation tax at the rate for 1997, that is to say 33.33%, increased by the two additional contributions of 10% and 15% (Article 235b ZA and ZB of the General Tax Code), thus at an overall rate of 41.67%. 401 However, the corrections should have been made for the 1996 financial year at the overall rate of 36.67%. Indeed, Article 4 of Law No 97-1026 expressly provides that the electrical energy structures of the RAG are to be deemed to have been owned by EDF from the time it was granted the concession for that network. 402 According to EDF, it is therefore necessary to reason as if it had always had ownership of the RAG, that is to say, as if it had never established provisions for the renewal of those assets. Accordingly, if it had not established the renewal provisions it would have become liable to tax in respect of the 1996 financial year, its pre-tax profits after imputation of previous carry-overs would have been positive on 31 December 1996, if account were also taken of other corrections connected with its accounting reform. EDF claims that it is therefore the rate in force for the 1996 financial year that should be applied to the correction exercise and, a fortiori, to assess globally any possible shortfall in tax paid. 403 Lastly, it should be noted that the balance sheet that served as a basis for the restructuring was that of 31 December 1996, that the tax paid in 1997 in respect of that restructuring was calculated without taking into account the profit or loss for the 1997 financial year and that the tax credits available on 31 December 1996 were imputed to that tax. 404 In conclusion, EDF submits that the value of grantor rights that could be classified as new aid, following this reasoning, is FRF 7 655 million, to which the corporation tax rate for 1996, 36.67%, should be applied. From that sum it is necessary to deduct the overtaxation on the sum of FRF 38 520 million resulting from taxation at the rate of 41.67% instead of 36.67%, which is FRF 1 926 million. Thus, the value of the aid would be: [7 976 x 36.67%] — [38 520 x (41.67% — 36.67%)] = FRF 998.80 million, or EUR 151 million. 405 The Commission disputes these arguments. 2. Findings of the General Court 406 In support of the first part of the second plea in law put forward in the alternative, EDF argues that calculation errors were made in the determination of the value of the renewal provisions. 407 In support of the second part of the plea, EDF also argues, essentially, that it was a mistake to use the 1997 taxation rate in order to calculate the tax advantage from which it had benefited and that the rate applicable in 1996, which was more favourable, should have been used instead. 408 First of all, it must be remembered that the letter of 22 December 1997 (see paragraph 23 above), stated, with regard to the grantor rights: ‘consolidation as capital contributions of the value of the assets in kind comprising the RAG under concession at FRF 14 119 065 335’. 409 Secondly, in the memorandum of 9 April 2002 (Annex D.2 to the rejoinder), the French authorities had stated the following: ‘a distinction must be drawn between the reclassification of the provisions for renewal that were used, which appeared, according to the information provided by EDF, under the item “Grantor rights” in the amount of [FRF] 14.119 [billion] rather than [FRF] 18.345 [billion], and the reclassification of the still-unused provisions amounting to [FRF] 38.5 [billion]. The grantor rights [corresponding to used renewal provisions] in respect of the RAG represent an unowed debt [from EDF to the State, as it was shown in the balance sheet] which was unjustifiably exempted from tax by being incorporated into the capital. … Since the RAG constituted own assets, EDF had no debt obligation towards the State to return those assets, with the result that the corresponding amounts posted in the item “Grantor rights” constitute not actual liabilities, but a non-tax-exempt reserve. Under those circumstances, before that reserve was incorporated into the capital, it should have been transferred from the enterprise’s liabilities, where it was incorrectly posted, to a net assets account, thereby resulting in a positive variation in net worth that was taxable … The tax advantage thus obtained may be assessed at [FRF] 5.88 [billion] (14.119 x 41.67%).’ 410 Those figures are further clarified in a footnote to the memorandum of 9 April 2002: ‘Normal rate of corporation tax (31.33%) increased by the additional contributions in force for the financial years ending between 1 January 1997 and 1 January 1999’. 411 Thirdly, it must be remembered that, in the reorganisation of EDF’s balance sheet, the French authorities had followed the opinion of the National Accountancy Council, which stated that corrections to accounting errors, which by their very nature relate to the posting of past transactions, ‘are to be posted in the profit and loss account for the financial year in which they are discovered’ (see Annex I‑8 to the statement in intervention). 412 The letter of 22 December 1997 (see paragraph 23 above) states, in this regard, that the ‘renewal provisions which have become unwarranted (FRF 38 520 943 408) [were reclassified] as retained income, in accordance with [the National Accountancy Council Opinion]’. It is also clear from Annex 3 to that letter that that reclassification entailed a variation in net worth that was subject to corporation tax at the rate of 41.66%, which, the parties are agreed, was the applicable rate of taxation in 1997. 413 Consequently, the Commission cannot be criticised from relying on the information concerning the value of the renewal provisions and the applicable rate of taxation that had been provided to it by the French Republic during the administrative procedure in order to calculate the amount of aid at issue (see, to that effect, judgment of 30 November 2009, France and France Télécom v Commission, T‑427/04 and T‑17/05, EU:T:2009:474, paragraphs 302 and 303, confirmed on appeal by the judgment of 8 December 2011, France Télécom v Commission, C‑81/10 P, EU:C:2011:811, paragraphs 102 to 104). 414 Therefore, both parts of the second plea put forward in the alternative, and thus that plea in its entirety, must be dismissed. IV. Costs 415 Under Article 134(1) 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. In addition, under Article 134(2) of those rules, where there is more than one unsuccessful party the Court is to decide how the costs are to be shared. Furthermore, Article 138(1) of the rules provides that Member States and institutions which intervene in proceedings are to bear their own costs. 416 Since EDF and the French Republic have been unsuccessful, they must be ordered to bear their own costs and to pay those incurred by the Commission, in accordance with the latter’s pleadings. On those ground, THE GENERAL COURT (Third Chamber) hereby: 1. Dismisses the action; 2. Orders Électricité de France (EDF) to bear its own costs and to pay those incurred by the European Commission, with the exception of the costs which the latter has incurred as a result of the intervention of the French Republic; 3. Orders the French Republic to bear its own costs and those incurred by the Commission as a result of its intervention. Frimodt Nielsen Kreuschitz Półtorak Delivered in open court in Luxembourg on 16 January 2018. [Signatures] Table of contents I. Background to the dispute A. Introduction B. The beneficiary of the aid C. The creation of accounting provisions for the renewal of the RAG D. Reclassification of the accounting provisions E. The tax implications of the reclassification of the accounting provisions F. The opening decision G. The initial decision of the Commission H. The judgment in Case T156/04 I. The judgment in C124/10 P J. The extension decision K. The contested decision II. Procedure and forms of order sought by the parties III. Law A. The first plea in law 1. Arguments of the parties 2. Findings of the General Court B. The second plea in law 1. The contested decision 2. Preliminary observations 3. The first part of the second plea in law (a) Arguments of the parties (b) Findings of the General Court 4. The second part of the second plea in law (a) Arguments of the parties (b) Findings of the General Court 5. The third part of the second plea in law (a) Arguments of the parties (b) Findings of the General Court (1) The alleged error of law (2) The alleged errors of fact 6. The fourth part of the second plea in law (a) Arguments of the parties (b) Findings of the General Court 7. The fifth part of the second principal plea in law (a) Arguments of the parties (b) Findings of the General Court 8. Conclusion regarding the second principal plea in law C. The third plea in law D. The fourth plea in law 1. Arguments of the parties 2. Findings of the General Court E. The first plea in law put forward in the alternative 1. The contested decision 2. The first part of the plea, alleging infringement of Article 1(b)(v) of Regulation No 659/1999 (a) Arguments of the parties (b) Findings of the General Court 3. The second part of the plea, alleging infringement of Article 15(1) of Regulation No 659/1999 (a) Arguments of the parties (b) Findings of the General Court F. The second plea in law put forward in the alternative 1. Arguments of the parties 2. Findings of the General Court IV. Costs * Language of the case: French.