Judgment — ECLI:EU:T:2014:165
Date: 2014-03-28
Language of the case: Italian
Court formation: First Chamber
Subject matter: Economic, social and territorial cohesion;European Regional Development Fund (ERDF)
Procedure: Action for annulment - unfounded
Origin: Italy

Judgment of the General Court (First Chamber) of 28 March 2014 — Italy v Commission (Case T‑117/10) ERDF — Reduction of financial assistance — 2000-2006 regional operational programme for the region of Apulia (Italy) covered by objective No 1 — Serious failings in management or control systems which could lead to systemic irregularities — Partnership principle — Proportionality — Article 39(3)(b) of Regulation (EC) No 1260/1999 — Articles 4, 8, 9 and 10 of Regulation (EC) No 438/2001 — Duty to state reasons — Lack of competence 1. Economic, social and territorial cohesion — Structural assistance — EU financing — Obligation on Member States to establish monitoring and control systems — Serious failings which could lead to systemic irregularities — Consequence — Reduction of financial assistance (Art. 317 TFEU; Council Regulation No 1260/1999, Arts 38(1), and 39(2)(c), and (3); Commission Regulation No 438/2001, Arts 4 and 10) (see paras 50, 51, 91, 92) 2. Economic, social and territorial cohesion — European Regional Development Fund — Clearance of accounts — Disallowance of expenses arising from irregularities in applying EU rules — Challenge by the Member State concerned — Burden of proof — Allocation between the Commission and the Member State (Council Regulation No 1260/1999; Commission Regulation No 438/2001) (see para. 56) 3. Economic, social and territorial cohesion — European Regional Development Fund — Decision to reduce financial assistance — Need for a prior cooperation procedure (Council Regulation No 1260/1999, Arts 38 and 39) (see para. 97) 4. EU law — Principles — Proportionality — Scope — Complete withdrawal of financial assistance granted by the ERDF — Lawfulness — Conditions — Burden of proof — Finding of defects in the control system established by a Member State — Flat-rate correction of 10% of expenses — Lawfulness (Art. 5(4) TEU; Council Regulation No 1260/1999, Art. 39(3)) (see paras 108, 115, 116) 5. Acts of the institutions — Rules of administrative conduct of general scope — Measure designed to produce external effects — Autolimitation of the discretion of the institution adopting the measure (see para. 110) 6. Acts of the institutions — Statement of reasons — Obligation — Scope — Decision of the Commission reducing the amount of EU financial assistance (Art. 296 TFEU) (see paras 125, 129, 130) 7. Acts of the institutions — Statement of reasons — Obligation — Scope — Plea based on lack or inadequacy of reasoning — Plea alleging incorrectness of the statement of reasons — Distinction (Art. 296 TFEU) (see paras 126, 128) 8. Economic, social and territorial cohesion — Structural assistance — EU financing granted for national projects — Suspension or reduction of financial assistance granted for a national project — Procedure distinct from and independent of an action for failure to fulfil obligations (Art. 258 TFEU; Council Regulation No 1260/1999, Art. 39) (see paras 140-143) Re: APPLICATION to annul Commission Decision C(2009) 10350 final of 22 December 2009 reducing the financial assistance from the European Regional Development Fund allocated to the Italian Republic pursuant to Commission Decision C(2000) 2349 of 8 August 2000, approving the regional operational programme POR Puglia, in respect of the period 2000-2006, under objective No 1. Operative part The Court: 1. Dismisses the action; 2. Orders the Italian Republic to bear its own costs and to pay those incurred by the European Commission.