Judgment — ECLI:EU:C:1999:313
Date: 1999-06-17
Language of the case: Italian
Court formation: Fifth Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: State aids;Competition
Concepts: Jurisdiction of the Court of Justice;Existing aid and new aid;Selective nature of the measure;Direct effect of the final sentence of Article 108(3) TFEU and role of national courts
Procedure: Reference for a preliminary ruling
Origin: Italy

Summary of the Judgment 
1. Preliminary rulings — Jurisdiction of the Court — Limits — State aid — Role of the 
national courts — To ensure that the rights of individuals are fully safeguarded — 
Possibility of consulting the Commission or of making a reference to the Court for a 
preliminary ruling 
(EC Treaty, Art. 92 (now, after amendment, Art. 87 EC) and Arts 93(3) and 177 (now 
Arts 88(3) EC and 234 EC)) 
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SUMMARY — CASE C-295/97 
2. State aid — Concept — Application to large industrial undertakings which are 
insolvent of a system derogating from the rules of ordinary law relating to 
insolvency — Covered — Conditions 
(EC Treaty, Art. 92 (now, after amendment, Art. 87 EC)) 
3. State aid — Existing aid and new aid — Notification to the Commission — 
Implementation before the Commission decision — Prohibited — Scope of that 
prohibition 
(EC Treaty, Art. 92 (now, after amendment, Art. 87 EC) and Art. 93 (now Art. 88 
EC)) 
1. Within the framework of proceedings 
brought under Article 177 of the EC 
Treaty (now Article 234 EC), the Court 
does not have jurisdiction to interpret 
national law or to give a ruling on the 
compatibility of a national measure 
with Community law. 
However, as regards the review of 
Member States' compliance with their 
obligations under Article 92 of the 
Treaty (now, after amendment, Arti­
cle 87 EC) and Article 93 thereof (now 
Article 88 EC), a national court may, in 
order to determine whether a State 
measure introduced without taking 
account of the preliminary examina­
tion procedure laid down in Arti­
cle 93(3) of the Treaty should have 
been subject to that procedure, have 
cause to interpret the concept of aid 
contained in Article 92 of the Treaty. If 
it has doubts as to whether the measure 
in question should be classified as State 
aid, it may ask the Commission for 
clarification on that point or, in accor­
dance with the second and third para­
graphs of Article 177 of the Treaty, it 
may or must refer a question to the 
Court for a preliminary ruling on the 
interpretation of Article 92 of the 
Treaty. 
2. The concept of aid is wider than that of 
a subsidy because it embraces not only 
positive benefits, such as subsidies 
themselves, but also measures which, 
in various forms, mitigate the charges 
which are normally included in the 
budget of an undertaking and which, 
without therefore being subsidies in the 
strict sense, are similar in character and 
have the same effect. Moreover, the 
expression 'aid', within the meaning of 
Article 92(1) of the Treaty (now, after 
amendment, Article 87(1) EC), neces­
sarily implies advantages granted 
directly or indirectly through State 
resources or constituting an additional 
charge for the State or for bodies 
designated or established by the State 
for that purpose. 
Application of a system derogating 
from the rules of ordinary law relating 
to insolvency, for the benefit of large 
industrial undertakings in difficulties 
which owe particularly large debts to 
certain, mainly public, classes of cred­
itors, is to be regarded as giving rise to 
the grant of State aid, within the 
meaning of Article 92(1) of the Treaty, 
where it is established that the under­
taking 
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PIAGGIO V IFITALIA 
— has been permitted to continue trad­
ing in circumstances in which it 
would not have been permitted to 
do so if the rules of ordinary law 
relating to insolvency had been 
applied, or 
— has enjoyed one or more advantages, 
such as a State guarantee, a reduced 
rate of tax, exemption from the 
obligation to pay fines and other 
pecuniary penalties or de facto 
waiver of public debts wholly or in 
part, which could not have been 
claimed by another insolvent under­
taking under the application of the 
rules of ordinary law relating to 
insolvency. 
3. It is clear from both the terms and 
purposes of Article 93 of the Treaty 
(now Article 88 EC) that the concept 
of existing aid within the meaning of 
Article 93(1) embraces aid which 
existed before the entry into force of 
the Treaty and aid which could be 
properly put into effect under the 
conditions laid down in Article 93(3) 
thereof, including aid notified to the 
Commission but in respect of which the 
Commission has not yet adopted a 
position, after a reasonable length of 
time has elapsed for reflection and 
investigation, as regards the compat­
ibility of the aid planned with the 
common market, as is clear from the 
Court's interpretation of Article 93(3) 
in Case 120/73. On the other hand, 
measures to grant or alter aid, where 
the alterations may relate to existing 
aid or to initial plans notified to the 
Commission, must be regarded as new 
aid subject to the obligation of notifi­
cation laid down by Article 93(3). 
Consequently, where it is established 
that a system derogating from the rules 
of ordinary law relating to insolvency 
is in itself capable of giving rise to the 
grant of State aid within the meaning 
of Article 92(1), that system cannot be 
put into operation unless it has been 
notified to the Commission and, if it 
has been so notified, before the Com­
mission has made a decision acknowl­
edging that the aid plan is compatible 
with the common market, or, if the 
Commission takes no decision within a 
period of two months from the notifi­
cation, before that period has expired. 
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