Judgment — ECLI:EU:C:2011:551
Date: 2011-09-08
Language of the case: Dutch
Court formation: Third Chamber
Subject matter: State aids;Competition
Procedure: Action for annulment;Appeal - unfounded;Appeal - successful
Origin: Netherlands

Summary of the Judgment 1. Actions for annulment – Actionable measures – Definition – Measures producing binding legal effects – Decision classifying a notified measure as State aid and declaring it compatible with the common market – Included (Arts 87 EC, 88 EC and 230 EC; Council Regulation No 659/1999) 2. State aid – Concept – Selective nature of the measure (Art. 87(1) EC) 3. State aid – Concept – Selective nature of the measure (Art. 87(1) EC) 4. State aid – Concept – Assessment in accordance with the criterion of normal market conditions (Art. 87(1) EC) 5. State aid – Concept – Aid derived from State resources (Art. 87(1) EC) 6. State aid – Commission decision classifying a measure as State aid – Obligation to state reasons – Scope (Arts 87(1) EC and 296 TFEU) 1. If the Commission finds, following the preliminary examination, that the measure notified, in so far as it falls within the scope of Article 87(1) EC, does not raise any doubts as to its compatibility with the common market, it is to adopt a decision not to raise objections under Article 4(3) of Regulation No 659/1999 concerning the application of Article 88 EC. Such a decision triggers, inter alia, the application of the procedure provided for in respect of existing aid schemes by that regulation and, in particular, the application of the procedure laid down in Articles 17 to 19 and Article 21 thereof, which requires the Member States to submit an annual report on all existing aid schemes. A mistaken classification of a measure as State aid does therefore have legal consequences for the notifying Member State, in that such a measure is subject to constant monitoring by the Commission and to periodic checks by it, meaning that that Member State enjoys restricted room for manoeuvre in implementing the notified measure. It necessarily follows from this that a decision based on Article 87(1) and (3) EC which, while classifying the measure in question as State aid, declares it compatible with the common market, must be regarded as a challengeable act under Article 230 EC. Such a decision of compatibility within the meaning of Article 87(1) and (3) EC also has a final character and does not constitute a preparatory measure. (see paras 40-42) 2. In order to prove that a measure capable of being classified as State aid applies selectively to certain undertakings or to the production of certain goods, it is for the Commission to prove that it creates differences between undertakings which, with regard to the objective of the measure in question, are in a comparable factual and legal situation. In that regard, since the Commission finds, in its decision, that certain undertakings benefiting from a measure classified as State aid fall within a specific group of large industrial undertakings engaged in trade between the Member States and enjoy an advantage which is not available to other undertakings, that advantage being that they are able to monetise the economic value of the emission reductions they achieve, by converting them into tradable emission allowances or, as the case may be, avoiding the risk of having to pay fines when they exceed the nitrogen oxides emission limit laid down by the national authorities by buying such emission allowances from other undertakings falling within the State measure in question, whereas the other undertakings do not have those opportunities, the Commission is not required to go into any more detail in its decision. In the case of an aid programme, it may confine itself to examining the characteristics of the programme in question in order to determine, in the grounds of its decision, whether, by reason of the terms of the programme, it gives an appreciable advantage to recipients in relation to their competitors and is likely to benefit in particular undertakings engaged in trade between Member States. (see paras 62-63, 65) 3. Article 87(1) EC does not distinguish between measures of State intervention by reference to their causes or their aims but defines them in relation to their effects. Even if environmental protection constitutes one of the essential objectives of the European Community, the need to take that objective into account does not justify the exclusion of selective measures from the scope of Article 87(1) EC, as account may, in any event, usefully be taken of the environmental objectives when the compatibility of the State aid measure with the common market is assessed pursuant to Article 87(3) EC. With regard, in particular, to a measure putting in place an emission trading scheme for nitrogen oxides which differentiates between undertakings based on a quantitative criterion, such as the criterion of total installed thermal capacity of undertakings, the substantial nitrogen oxides emissions of the undertakings covered by the measure in question and the specific reduction standard applicable to those undertakings are not sufficient to enable that measure to avoid classification as a selective measure for the purposes of Article 87(1) EC, because the differentiation between the undertakings cannot be regarded as inherent in a scheme intended to reduce industrial pollution and, therefore, justified only on environmental grounds. Since such a distinguishing criterion is not justified either by the nature or the general scheme of the measure concerned, it cannot deprive the measure in question of its character of State aid. In that regard, it is for the Member State which has introduced such a differentiation between undertakings to show that it is actually justified by the nature and general scheme of the system in question. (see paras 75-78) 4. Measures which, whatever their form, are likely directly or indirectly to favour certain undertakings or are to be regarded as an economic advantage which the recipient undertaking would not have obtained in normal market conditions, are regarded as State aid. That is the case for a system in which only some undertakings are able to monetise the economic value of the nitrogen oxides emission reductions they achieve, by converting them into tradable emission allowances or, as the case may be, avoiding the risk of having to pay fines when they exceed the nitrogen oxides emission limit laid down by the national authorities by buying such emission allowances from other undertakings falling within the State measure in question because the tradability of the nitrogen oxide emission allowances depends above all on the fact that the State, first, authorises the sale of those allowances and, second, allows those undertakings which have emitted a surplus of nitrogen oxide to acquire from other undertakings the missing emission allowances, thereby agreeing to the creation of a market for those allowances. The tradability of those allowances cannot be regarded as consideration, at the market price, for the efforts undertaken by the undertakings falling within the measure in question to restrict their nitrogen oxide emissions because the costs of reducing those emissions fall within the charges to which the budget of the undertaking is normally subject. Furthermore, the right of those undertakings to choose between the costs of acquiring the emission allowances and the costs linked to measures intended to reduce their nitrogen oxide emissions constitutes an advantage for them. In addition, the right, for the undertakings covered by the measure in question, to trade all the emission allowances and not only the credits resulting at the end of the year from the positive difference between the authorised emission and the emission obtained, constitutes an additional advantage for those undertakings. The latter can enjoy liquidity by selling the emission allowances before the conditions for their final allocation have arisen, irrespective of the fact that a ceiling is applicable to them, and the undertakings which exceed the emission norm laid down must compensate for that surplus the following year. (see paras 87-91) 5. For it to be possible for advantages to be categorised as aid within the meaning of Article 87(1) EC, they must, first, be granted directly or indirectly through State resources, and, second, be imputable to the State. That is the case with regard to a State measure which places nitrogen oxides emission allowances at the disposal of certain undertakings free of charge rather than selling them or putting them up for auction and which sets up a scheme making it possible to trade those allowances on the market, even if they are linked to a maximum ceiling, while granting to the undertakings covered by the measure in question the opportunity of purchasing emission allowances in order to avoid the payment of fines. The tradability of nitrogen oxides emission allowances constitutes an advantage granted by the national legislature to certain undertakings which could entail an additional burden for the public authorities in the form of an exemption from the obligation to pay fines or other pecuniary penalties. In addition, since that system creates, without real consideration supplied to the State, emission allowances which, because of their tradable character, have an economic value, by conferring on those emission allowances the character of tradable intangible assets and by making them available to the undertakings concerned free of charge instead of selling those allowances or putting them up for auction, the State forgoes public resources. In addition, the fact that such a measure permits undertakings to offset among each other the surpluses or deficits in relation to the standard laid down and that that measure creates a legal framework for limiting the discharge of nitrogen oxides emissions in a profitable manner for undertakings with large facilities, shows that the undertakings covered by the measure in question have an alternative to the imposition of a fine by the State. (see paras 103, 106-108) 6. Applied to the classification of a measure as State aid, the obligation to state reasons requires the reasons why the Commission considers that the measure in question falls within the field of application of Article 87(1) EC to be stated. In that regard, the Commission is not required to establish the existence of a real impact of the aid on trade between Member States and an actual distortion of competition, but only to examine whether that aid is capable of affecting such trade and distorting competition. Thus, when it is apparent from the circumstances in which aid was granted that it is liable to affect trade between Member States and to distort or threaten to distort competition, the Commission must set out those circumstances in the statement of reasons for its decision. (see para. 131)