Opinion of the Advocate General — ECLI:EU:C:2021:1029
Date: 2021-12-16
Language of the case: English

summary, I consider that, contrary to what the General Court held in paragraph 142 of the judgment under appeal, the Forum 187 judgment does not support the position that the arm’s length principle is applicable where national tax law is intended to tax integrated companies and stand-alone companies in the same way, irrespective of whether that principle has been incorporated into that law. 127. Accordingly, Ireland’s sixth complaint must, in my view, be upheld. 128. By its seventh complaint, Ireland considers that the arm’s length principle does not stem from OECD documents and that the market economy operator principle, which formed the basis of the Commission’s approach in the matter, does not constitute an appropriate legal basis. In that regard, it notes that the Commission referred to the latter principle in the decisions to initiate the procedures relating to the tax rulings issued in favour of Apple, Fiat and Starbucks and that the Commission confirmed, at the oral hearing held before the General Court in the present case, that it no longer based its theory concerning the arm’s length principle on the market economy operator principle. 129. As regards that complaint, I would merely note that it appears to criticise, in generic terms, the Commission’s general approach to the basis of the arm’s length principle, without addressing the reasons for the approval of that approach in the judgment under appeal. In those circumstances, I invite the Court to declare that complaint inadmissible. 130. The third and fourth complaints raised by Ireland call for a reminder of the relevant passage of the judgment under appeal. In paragraph 152 of the judgment, the General Court noted that, at the hearing, the Commission had stated that the arm’s length principle was inherent in the ordinary system of taxation as provided for by national law as a corollary of the ‘separate legal entity’ approach, according to which national law is concerned with legal entities and not with economic entities. In paragraph 153, the General Court addressed the objections of the Grand Duchy of Luxembourg and FFT according to which the Commission had thereby changed at the hearing the stance on the arm’s length principle which it had expressed in the decision at issue. While acknowledging that a change in the legal basis of the arm’s length principle given in the decision at issue was not legally legitimate, the General Court considered that, in any event, this did not call into question its earlier finding that the arm’s length principle is a tool used in the context of the examination under Article 107(1) TFEU. 131. In that regard, Ireland submits, in the first place, that the Commission could not validly rely, without disregarding the rights of defence, on the new argument that it had thus raised at the hearing. The separate legal entity approach had not been given as a legal basis for that principle in the decision at issue. 132. In the second place, Ireland claims that, even if the Commission had indicated in the decision at issue that the separate legal entity approach was the legal basis of the arm’s length principle, it committed an error of law. In its view, it is erroneous to assert that that principle is a necessary corollary of the separate entity approach, since other models of taxation, such as that of apportionment according to a pre-established formula, as provided for by the proposal for a directive on a common corporate tax base, are also based on that approach. 133. In that regard, I would state here that the Court of Justice should not, in my view, allow itself to be drawn into a discussion which has no practical significance, since the General Court did not base its decision on the elements criticised by Ireland in its complaints. Such a discussion would be purely theoretical or, more precisely, would have no bearing on the resolution of the dispute before it. 134. It should be noted that, in paragraph 153 of the judgment under appeal, the General Court did not rule on the question whether, by the explanations given by the Commission at the hearing on the relationship between the implementation of the separate legal entity approach in the national tax system and the arm’s length principle, the Commission had changed the stance initially taken in the decision at issue. On the contrary, the General Court merely held, in essence, that, even if the objections raised by the Grand Duchy of Luxembourg and FFT had been regarded as well founded, this would not have affected the conclusion reached by the General Court as to the legal basis for using the arm’s length principle. (71) The present complaints therefore are based on a misreading of the judgment under appeal. 135. Ireland’s third and fourth complaints must therefore be rejected, in my view, as ineffective. (iv) The scope of the arm’s length principle and the principle of legal certainty 136. By its eighth complaint, Ireland considers that the content of the arm’s length principle used by the Commission in the decision at issue and endorsed by the General Court in the judgment under appeal is fundamentally unclear. In that regard, Ireland observes that, whilst the only precise definition of the arm’s length principle is to be found in the documents drawn up by the OECD, recital 229 of the decision at issue and paragraph 147 of the judgment under appeal state that the OECD’s arm’s length principle differs from that of the Commission. Moreover, it is apparent from paragraph 149 of the judgment under appeal that the Commission is not required to take into account the way in which the arm’s length principle is defined by national law, which led it to disregard, in the present case, the fact that the Grand Duchy of Luxembourg had in fact incorporated that principle into its domestic law. Lastly, according to Ireland, there is no definition in any manual or guidelines of the content of the arm’s length principle as described by the Commission in the decision at issue. The failure to describe the content of that principle is problematic in the light of the principle of legal certainty, in so far as it is thus impossible for a taxpayer or for a national tax authority to know which rules actually apply. 137. In its response, the Commission counters, in particular, that the content of that principle is extremely clear. It provides that transactions between related economic operators must be assessed for tax purposes as if they had been concluded at arm’s length between unrelated economic operators. 138. It should be recalled that the principle of legal certainty, which is a general principle of EU law and thus applies to the acts of the institutions, bodies, offices and agencies of the European Union, requires, according to settled case-law, that rules of law be clear and precise and that they be foreseeable. (72) In particular, that principle requires an assessment of whether an EU legal act enables those concerned to know precisely and to ascertain unambiguously the extent of their rights and obligations and to take steps accordingly. (73) That requirement must be observed all the more strictly in the case of a measure liable to have financial consequences. (74) 139. It is apparent from the case-law of the Court that the principle of legal certainty is intrinsically linked to the legislative measures enacted by the European Union and by the national authorities when they implement EU law and that it allows judicial review of the imperfections that might lead to uncertainty as to the application of the legislative measure in question. (75) 140. The principle of legal certainty has a more limited scope as regards an administrative decision, as is apparent from the case-law on State aid. In that area, an infringement of the principle of legal certainty may be found by the Court only where the conduct of the Commission prior to or during the procedure leading to a decision to recover the State aid was at issue. (76) 141. In the case at hand, the principle of legal certainty is invoked against the use, for the purpose of examining the advantage condition, of the arm’s length principle due to the claimed difficulty in grasping the content of that principle. What is disputed here, in other words, is the validity of an assessment by the Commission concerning the classification of a State measure as State aid. However, the validity of such an assessment cannot, in my view, be called into question from the perspective of compliance with the principle of legal certainty. Taking the opposite view would be tantamount to prohibiting the Commission from considering new approaches to the application of rules of law and would therefore oblige it to freeze its position in time. In particular, such a reading would mean that the Commission would be prevented from using any new benchmark to guide its assessment of the existence of an advantage within the meaning of Article 107(1) TFEU. 142. If that were the case, the market economy investor principle could not have been incorporated into the examination of the advantage condition, since, when that principle made its first appearances in decision-making practice in the early 1980s, its content was far from fully developed. When the Court approved it in 1986, the market economy investor principle required simply assessing ‘whether in similar circumstances a private shareholder, having regard to the foreseeability of obtaining a return and leaving aside all social, regional-policy and sectoral considerations, would have subscribed the capital in question’. (77) It is only over the course of the years that the Commission’s decision-making practice and quasi-legislative activities and the case-law of the Court have defined the detailed rules governing its application. (78) 143. Similarly, the content of the arm’s length principle has essentially been defined by the Commission as meaning that transactions between integrated undertakings must be priced for tax purposes as if they had been concluded between stand-alone undertakings. It was applied, in the present case, in accordance with the OECD guidelines. It is the combined effect of the legislative rules and the case-law cited at the end of the preceding point that will subsequently determine the manner in which it is implemented. 144. I therefore consider that the principle of legal certainty cannot be relied on to criticise the General Court for having accepted an insufficiently precise description by the Commission of the content of a benchmark, such as the arm’s length principle, in a decision adopted by that institution. 145. It follows that the eighth complaint raised by Ireland should, in my view, be rejected as unfounded. (3) Conclusion on the first ground of appeal 146. In the light of the foregoing considerations, and in particular of my proposals concerning the fifth and sixth complaints raised by Ireland, I suggest that the Court of Justice uphold the first ground of appeal in so far as the General Court erred in law in approving the reference framework as established by the Commission for the purpose of examining the existence in the present case of an advantage within the meaning of Article 107(1) TFEU. Indeed, the case-law of the Court according to which an error in the determination of that framework vitiates the whole of the analysis relating to selectivity (79) may, to my mind, be applied by analogy to the examination of advantage. (c) The third ground of appeal (1) Arguments of the parties 147. By its third ground of appeal, Ireland submits that the General Court breached its obligation to state reasons. First, the General Court failed to rule on the precise legal basis of the arm’s length principle, which is described simply as a ‘tool’ or a ‘benchmark’. Secondly, Ireland submits that the reasoning followed in the judgment under appeal is contradictory in that the General Court indicated that the arm’s length principle, as it was characterised in the decision at issue, is ‘a general principle of equal treatment in taxation’ (paragraph 150 of the judgment under appeal) and not ‘a general principle of equal treatment in relation to tax’ (paragraph 161 of the judgment under appeal), without explaining such a distinction. 148. The Commission takes the view that this ground of appeal is based on a misreading of the judgment under appeal and must therefore be rejected. (2) Assessment 149. As a preliminary point, it should be recalled that, according to settled case-law, the statement of the reasons on which a judgment of the General Court is based must disclose in a clear and unequivocal fashion the General Court’s reasoning, in such a way as to enable the persons concerned to ascertain the reasons for the decision taken and the Court of Justice to exercise its power of review. (80) 150. As regards the complaint that no reasons were given as to the legal basis for the arm’s length principle, I would observe at the outset that, after having noted in general terms that the arguments of the Grand Duchy of Luxembourg and FFT criticising that legal basis are examined in paragraphs 126 to 187 of the judgment under appeal, Ireland appears not to refer to the relevant points of that judgment. Had it done so, that Member State could not, in my view, have criticised the General Court for having failed to identify the legal basis in question. 151. As I have already shown in this Opinion, the General Court ruled on that matter in paragraph 141 of the judgment under appeal. Before setting out its content by stating that, where a tax measure is granted to an integrated undertaking, the Commission may compare the fiscal burden resulting from the application of that measure with that resulting from the application of the ‘normal’ rules of taxation under national law of a stand-alone undertaking in a comparable situation, the General Court took pains to clarify that the arm’s length principle is derived from national law, and, in particular, that, ‘where national tax law does not make a distinction between integrated undertakings and stand-alone undertakings for the purposes of their liability to corporate income tax, that law is intended to tax the profit arising from the economic activity of such an integrated undertaking as though it had arisen from transactions carried out at market prices’. Having thus identified the legal basis of the arm’s length principle, the General Court in essence held, in paragraph 145 of the judgment under appeal, that that principle was applicable in the present case in so far as the Income Tax Code was aimed at taxing integrated companies and stand-alone companies in the same way in respect of corporate income tax. 152. While that legal basis is not compatible with the relevant case-law, as is apparent from the examination of the fifth complaint in the first ground of appeal, it cannot be denied that it was nevertheless identified by the General Court, which indisputably deprives the complaint alleging a failure to state reasons in the judgment under appeal of any foundation in that connection. 153. The foregoing explains why, as Ireland rightly observes, paragraphs 151 to 154 of the judgment under appeal do not indicate what the basis of the arm’s length principle is. In paragraphs 149 to 154 of that judgment, the General Court specifically sought to demonstrate that the arguments put forward by the Grand Duchy of Luxembourg and FFT were not capable of invalidating the conclusion which had already been reached, namely that the arm’s length principle had its origin in national law. 154. As to the complaint that the statement of reasons is contradictory, it seems to me that that complaint arises from a misunderstanding of paragraphs 150 and 161 of the judgment under appeal. Ireland starts from the premiss that the General Court suggested that there was a difference between the description ‘general principle of equal treatment in taxation’, which applies to the arm’s length principle according to paragraph 150, and the description ‘general principle of equal treatment in relation to tax’, which does not apply to that principle according to paragraph 161. That premiss is, in my view, incorrect. 155. In paragraph 150 of the judgment under appeal, the General Court stated that the Commission had indicated, in recital 228 of the decision at issue, that the arm’s length principle was ‘a general principle of equal treatment in taxation, which fell within the application of Article 107 TFEU’. (81) In paragraph 161 of the judgment, the General Court responded to a complaint by Ireland and FFT that that wording could not be understood as asserting that there was a ‘general principle of equal treatment in relation to tax inherent in Article 107(1) TFEU’. (82) The General Court thus confined itself to dismissing one of the possible interpretations of recital 228 of the decision, as set out in paragraph 150 of the judgment under appeal, namely that according to which the legal basis for the arm’s length principle lay in Article 107(1) TFEU. I therefore see no contradiction between paragraph 150 and paragraph 161 of the judgment under appeal. In my view, therefore, this complaint must be rejected. 156. In the light of those considerations, I propose that the Court reject the third ground of appeal as unfounded. (d) The fourth ground of appeal (1) Arguments of the parties 157. By its fourth ground of appeal, Ireland submits that the General Court was wrong to reject the argument, examined in paragraphs 180 to 184 of the judgment under appeal, that the Commission, by imposing its arm’s length principle, infringed the principle of legal certainty. In arguing, in paragraph 183 of the judgment under appeal, that it was ‘foreseeable’ that the Commission would be able to verify whether the methodology for determining transfer pricing deviated from pricing that would have been set under market conditions, in order to examine whether that tax ruling conferred an advantage, the General Court disregarded the fact that the principle set out by the Commission is a new rule having content which the Luxembourg tax authorities could not have known in advance. Even if the Luxembourg tax authorities could have anticipated that the Commission might verify whether an integrated company was treated for tax purposes in the same way as a stand-alone company, it could neither have foreseen that the Commission would apply its own version of the arm’s length principle nor have known its content. 158. The Commission challenges Ireland’s entire reasoning. (2) Assessment 159. It is necessary, first of all, to delineate carefully the scope of the present ground of appeal. Ireland seems to me to call into question the refusal of the General Court to acknowledge that the examination of the existence of an advantage within a legal framework that was completely new and therefore unforeseeable for the national tax administration constituted an infringement of the principle of legal certainty. According to Ireland, the basis and content of the arm’s length principle had not been developed by the Commission prior to the adoption of the decision at issue, in particular by the publication of soft law instruments such as a manual or guidelines. 160. Admittedly, it cannot be denied that the approach adopted by the Commission in the decision at issue is somewhat novel. It should be recalled that the Commission’s previous decision-making practice in the field of fiscal aid contains no trace of the arm’s length principle, as conceived by the Commission in the decision at issue and approved by the General Court in the judgment under appeal. In that regard, an interpretation has already been carried out in this Opinion to demonstrate that the judgment under appeal was wrong to confirm the correctness of the reading in the decision at issue according to which the Forum 187 judgment ratified the use of such an arm’s length principle for the purpose of analysing the existence of an advantage. 161. I do not believe, however, that this can lead to the conclusion that the principle of legal certainty has been infringed. 162. In that regard, reference must be made once again to the Forum 187 judgment, in particular to the passage in which the Court adopted Advocate General Léger’s reading that, although the Commission is undoubtedly obliged to respect the principle of legal certainty when carrying out its task of monitoring State aid, that requirement is inseparable from the requirement to respect the principle of legality and, consequently, the provisions of Articles 107 and 108 TFEU. (83) The Court had therefore considered, in essence, that the principle of legal certainty was not infringed where the Commission altered its appraisal for the purpose of classifying a national tax measure as State aid. There is no doubt, in my view, that the finding concerning the relationship between the principles of legal certainty and of legality applies also to an assessment by the Commission which is novel in relation to its previous decision-making practice. It follows that the principle of legal certainty does not preclude the Commission from carrying out, as in the present case, a pioneering assessment into the question of whether a State measure constitutes State aid where it considers that this is the conclusion to which a correct application of Articles 107(1) and 108 TFEU must lead. It has moreover been explained in point 142 of this Opinion that the validity of an assessment by the Commission concerning the classification of a State measure as State aid cannot be called into question on the basis of the principle of legal certainty. 163. Similarly, the principle of legal certainty in no way requires that the new interpretation that the Commission wishes to introduce into the analysis carried out under Article 107(1) TFEU be set out in advance in manuals or guidelines. While such instruments contribute to ensuring that the Commission’s own actions are transparent, foreseeable and consistent with legal certainty, as the Court has repeatedly pointed out, (84) they are by no means necessary to justify the legality of such an initiative. 164. In those circumstances, I consider that no legal criticism can be levelled against the assertion in paragraph 183 of the judgment under appeal. 165. I therefore suggest that the Court reject the fourth ground of appeal as unfounded. (e) The fifth ground of appeal (1) Arguments of the parties 166. By its fifth ground of appeal, directed against paragraphs 100 to 117 of the judgment under appeal, Ireland criticises the General Court for having rejected its line of argument according to which the decision at issue amounts, in breach of Articles 3, 4 and 5 TEU and Article 114 TFEU, to harmonisation in disguise contrary to the principle of the division of competences. According to Ireland, the Commission relied in the decision at issue on rules which do not form part of the national tax system while disregarding the relevant provisions of that system. Ireland notes that, if the Commission is successful in the present case, the Commission’s arm’s length principle will be binding on all Member States, irrespective of what is provided for in their own tax legislation. 167. The Commission counters that it did in fact assess the tax ruling at issue in the light of the general Luxembourg corporate income tax regime and that, if the judgment of the General Court were confirmed as regards the finding of a selective advantage, it would simply mean that Member States that tax the branches or subsidiaries of multinational companies under their ordinary rules as if they were separate entities could not escape scrutiny of their tax rulings from the perspective of the State aid rules on the sole ground that their tax legislation did not expressly codify objective criteria for the attribution of profits to those branches or subsidiaries. (2) Assessment 168. As a preliminary point, it should be noted that Ireland does not contest the entire reasoning of the General Court in paragraphs 100 to 117 of the judgment under appeal. It wishes to clarify that it approves the first part of that reasoning, in which the General Court pointed out that the State aid rules are applicable to national tax measures. Its complaints relate solely to the finding in paragraph 113 of the judgment under appeal. 169. After having recalled, in paragraph 112 of that judgment, that the Commission does not have the power to define autonomously the ‘normal’ taxation of an integrated undertaking by disregarding national tax rules, the General Court, according to Ireland, wrongly held, in paragraph 113 of that judgment, that, in the decision at issue, the Commission had simply verified whether the tax ruling at issue conferred on its beneficiary an advantage over ‘normal’ taxation, as defined by national tax law. The erroneous nature of that finding is moreover supported, in Ireland’s view, by the fact that the General Court accepted, in paragraph 149 of the judgment under appeal, that the Commission had not examined whether the tax ruling at issue complied with Luxembourg tax law. 170. In other words, the present ground of appeal amounts to a challenge to the Commission’s use of the arm’s length principle to determine ‘normal’ taxation, made irrespective of any reference to the existence of that principle in national law. Accordingly, the answer that must be given in relation to this ground of appeal is the same as the answer to the question of whether or not it is necessary to confirm the General Court’s assessments as regards the reference framework for determining the existence of a tax advantage. 171. I would note, in that regard, that is indeed not surprising that, in a legal area characterised by the coexistence of the Treaty rules on State aid and national tax rules, in which prevention of the risk of those Treaty rules encroaching on the national rules involves assessing the existence of an advantage on the basis of a national reference framework, infringement of the division of competences between the European Union and its Member States depends on whether that reference framework has been correctly defined. 172. In the light of the proposal put forward in this Opinion that the first ground of appeal should be declared well founded in so far as the arm’s length principle used in the decision at issue is not a rule which is expressly codified in national law, I, like the appellant, consider that the judgment under appeal disregards, in paragraph 113 thereof, the Treaty provisions governing the division of competences between the European Union and its Member States (Article 3(6), Article 4(1) and Article 5(1) and (2)) and providing for a prohibition of harmonisation in the field of taxation (Article 114(2) TFEU). 173. I therefore invite the Court to uphold also the fifth ground of appeal. B. The second ground of appeal 174. By the present ground of appeal, Ireland argues, in essence, that the General Court was wrong to conclude that the Commission could rely in the present case on the presumption of selectivity, according to which a measure is presumed to be selective where it confers an advantage and constitutes individual aid, in so far as a tax ruling is individual aid. 175. The Commission submits that this ground of appeal must be rejected as ineffective. The decision at issue also established the selectivity of the tax ruling at issue by means of the three-step analysis applicable to aid schemes and this was approved by the General Court in paragraphs 360 to 366 of the judgment under appeal. According to the Commission, since Ireland has not contested those paragraphs in its appeal, the conclusion as to the selectivity of the tax ruling at issue remains valid even if the present ground of appeal is upheld. 176. On the merits, the Commission argues that an individual tax ruling cannot be regarded as being granted under a general aid scheme. According to the Commission, tax authorities, when endorsing a transfer pricing agreement in a tax ruling, have the possibility of influencing whether or not aid is granted in an individual case, since they can endorse either an agreement which produces an arm’s length outcome or a method which departs from such an outcome. Moreover, the elements constituting the advantage are to be found, in the case at hand, solely in the tax ruling at issue and not in the provisions of Luxembourg law on the basis of which that tax ruling was issued. 1. Effectiveness 177. It should be noted that, in the decision at issue, selectivity is assessed not only on the basis of a presumption, but also by using the three-step analysis already described in this Opinion. That analysis was carried out in the alternative and was endorsed by the General Court in paragraphs 360 to 366 of the judgment under appeal. 178. In that regard, it seems to me necessary to note, as the General Court did in paragraph 361 of the judgment under appeal, that the first two steps in that analysis, namely those relating to the determination of the reference framework and to the verification of the existence of a derogation from that framework, respectively, were examined concurrently with the economic advantage and that the question whether the tax ruling derogates from the reference framework, whether it be the broader or the more limited one, coincided with the identification of the advantage granted to the recipient undertaking. 179. In view of that, I would merely point out that that alternative analysis cannot remain valid should the Court of Justice decide in its forthcoming judgment to criticise the General Court’s findings relating to the basis of the arm’s length principle, as I invite it to do in this Opinion, which would in turn have the effect of invalidating the General Court’s entire examination of the selective advantage, both in its principal and in its alternative reasoning. 180. I therefore suggest that the Court rule that the present ground of appeal is not ineffective. 2. Merits 181. With regard to the presumption of selectivity, it should be recalled that this was first referred to in the judgment in Commission v MOL, in which the Court stated that ‘the selectivity requirement differs depending on whether the measure in question is envisaged as a general scheme of aid or as individual aid’ before next adding that, ‘in the latter case, the identification of the economic advantage is, in principle, sufficient to support the presumption that it is selective’. (85) It is therefore a rebuttable presumption, which applies subject to the fulfilment of a twofold requirement, namely the existence of an advantage for the purposes of Article 107(1) TFEU and the individual nature of the measure concerned. 182. To date, that individual nature has been recognised on three occasions for the purposes of applying the presumption of selectivity. In the first two judgments, delivered by the Court of Justice in Orange v Commission (86) and by the General Court in Greece v Commission, (87) the dispute concerned the classification as State aid of national legislative measures adopted for the benefit of France Télécom (88) and of the private company holding the concession to operate part of the port of Piraeus, respectively. (89) In the third judgment, that of the Court of Justice, in Mytilinaios Anonymos Etairia – Omilos Epicheiriseon, the dispute centred on the classification as State aid of the measure resulting from an interim order which declared invalid the termination by the Greek public electricity company of the agreement which had been previously concluded with a private company and which granted the latter a preferential electricity tariff. (90) 183. There is therefore no precedent, to my knowledge, in which the Courts of the European Union have been called upon to examine an administrative decision in that light. That examination entails a more complex assessment, since such a decision may constitute both an individual measure and a measure granted on the basis of an aid scheme. It is precisely this legal issue which is at the heart of the debate concerning the present ground of appeal. Ireland criticises the conclusion reached by the General Court in the judgment under appeal, arguing that, contrary to what the General Court held, the tax ruling at issue must be regarded as aid implemented in accordance with an aid scheme, referring in all likelihood to the scheme established by Article 164(3) of the Income Tax Code and Circular No 164/2. 184. The General Court concluded that the tax ruling at issue was individual in nature following an analysis based, in paragraphs 342 and 343 of the judgment under appeal, on the definitions of ‘individual aid’ and ‘aid scheme’ set out in Article 1(e) and in Article 1(d) of Regulation 2015/1589, (91) respectively. 185. The first of those provisions essentially characterises individual aid as aid which is not granted under an aid scheme, while the second makes classification as an ‘aid scheme’ subject to the fulfilment of three cumulative conditions. First, aid may be granted individually to undertakings on the basis of an act. Secondly, no further implementing measure is required for that aid to be granted. Thirdly, undertakings to which individual aid may be granted must be defined ‘in a general and abstract manner’. (92) It should be added that, as the General Court indicated in paragraphs 346 and 347 of the judgment under appeal and as the Court of Justice has very recently confirmed, fulfilment of those conditions implies, in particular, that the essential elements of the aid scheme must be apparent from the provisions identified as constituting the legal basis of that scheme and that the national tax authority, when adopting the measure, did not have discretion to influence the amount of the aid, its characteristics or the conditions for granting it. (93) 186. Ireland’s objections are not concerned, however, with the failure to fulfil those conditions in the present case. Ireland has adduced no evidence aimed at calling into question, in particular, the General Court’s findings concerning the legal source of the constituent elements of the State aid allegedly granted by means of the tax ruling at issue and the extent of the discretion available to the Luxembourg tax authorities when adopting the tax rulings. (94) 187. Ireland asserts, in essence, that an arrangement whereby all the tax rulings simply apply a legislative provision which is also the basis of a number of other tax rulings implies the existence of an aid scheme and a series of individual measures granted on the basis of that scheme. Accordingly, Ireland evokes, to my mind, a concept of ‘aid scheme’ with a scope broader than that provided for in Article 1(d) of Regulation 2015/1589. Indeed, in the remainder of its reasoning, Ireland criticises the General Court for having derived that concept from an instrument of secondary legislation, notwithstanding the fact that selectivity, as a constituent of the concept of State aid, stems directly from the Treaty and should not depend on definitions found in legislation. 188. The concept of selectivity as it is characterised by the case-law proves, according to Ireland, that, under an arrangement such as that under review, it is necessary to carry out a comparative examination based on the taking into account of the situations of other undertakings entitled to the same treatment as the undertaking to which the tax ruling is addressed. 189. In support of its argument, Ireland cites the judgment in Commission v Hansestadt Lübeck. (95) It seems clear to me, however, that that judgment cannot in any way support that argument since, in the case which gave rise to that judgment, there was no doubt that the State measure which the Commission wrongly classified as selective – a regulation adopted by the manager of Lübeck Airport (Germany) and relating to the charges payable by all the airlines using that airport – was an aid scheme, thereby making the comparative examination described in the preceding point mandatory. 190. To that same end, Ireland cites also the judgment of the Court in Commission v MOL. (96) It will be recalled that that case concerned a Hungarian mining law which provided that any mining company operating under an authorisation regime was entitled to ask the Mining Authority, once only, to extend the deadline for extraction from the fields concerned. If that authority agreed, a contract between the competent minister and the undertaking concerned determined the mining fee rate applied to those fields within an upper and a lower limit provided for by the law. 191. It is true that, as regards the selective nature of an extension agreement between that authority and the undertaking MOL, the Court of Justice, like the General Court, held that the Commission had failed to demonstrate the existence of selectivity because it had not verified whether MOL had received preferential treatment vis-à-vis any undertaking likely to be in a comparable situation. It is also true that, when concluding extension agreements such as the one in question, the national authority was applying a provision of the mining law and that the latter could form the basis for other agreements in similar situations. However, I do not believe that it can be inferred from that judgment, as Ireland seems to do, that those two elements alone are sufficient to conclude in the present case that aid was granted under an aid scheme and that the presumption of selectivity therefore does not apply. It should be recalled that, in that case, the Court was called upon to rule on whether the national authority’s margin of assessment in setting the mining fee when concluding extension agreements made it possible to conclude that the agreement at issue was selective. After having demonstrated the unusual nature of the measure at issue (‘optional provisions of national law prescribing the imposition of additional charges’), the Court answered in the negative, explaining that ‘the margin of assessment at issue in the present case allows the fixing of an additional charge imposed on economic operators in order to take account of the imperatives arising from the principle of equal treatment, and can be distinguished, by its very nature, from cases in which the exercise of such a margin is connected with the grant of an advantage in favour of a specific economic operator’. (97) 192. The inapplicability of the presumption of selectivity thus depending on the State measure under consideration, (98) I fail to see how that judgment can be regarded as providing criteria that can be applied beyond the situation examined by the Court. In order to reach the same conclusion in the present case, it would have to be established, in my view, that the case also involves an ‘optional provision of national law prescribing the imposition of additional charges’. In that regard, it should be noted, first, that, as was confirmed by the Grand Duchy of Luxembourg at the hearing, Article 164(3) of the Income Tax Code is not optional, since it is applicable to integrated undertakings even if they do not request a tax ruling from the Luxembourg tax authorities. Secondly, it seems clear to me that that article in no way imposes additional charges on those undertakings. 193. In conclusion, the case-law relating to selectivity relied on by Ireland does not permit an interpretation lending the concept of ‘aid scheme’ a scope broader than that recognised by Regulation 2015/1589, as that Member State claims. Accordingly, that case-law does not allow classification of the tax ruling at issue as individual aid to be ruled out, as follows from paragraphs 350 to 355 of the judgment under appeal. Consequently, I consider that the General Court committed no error of law in holding that the Commission correctly established the selective nature of the tax ruling at issue by applying the presumption of selectivity. 194. In the light of the foregoing considerations, I suggest that the Court reject Ireland’s second ground of appeal as unfounded. 195. For the sake of completeness, it is necessary, in my view, to make one further point. When pleading before the General Court that the tax ruling at issue should be regarded as aid granted under an aid scheme, the applicants at first instance did not claim that that scheme was based on Article 164(3) of the Income Tax Code and Circular No 164/2, in conjunction with the Luxembourg tax authorities’ consistent practice as regards tax rulings granted to financing and treasury companies other than FFT. Had the existence of such a consistent administrative practice been confirmed, the answer I advocate in the preceding point would probably be the opposite. 196. This would be the consequence of taking into account the interpretation of the concept of ‘aid scheme’, set out in Article 1(d) of Regulation 2015/1589, that was recently provided by the Court in the judgment in Commission v Belgium and Magnetrol International in relation to excess profit tax exemptions granted by the Belgian authorities in the form of tax rulings. When examining whether the first condition set by that article had been fulfilled, the Court specified that the ‘act’ of the scheme forming the basis on which individual aid is granted may also be a consistent administrative practice by the tax authorities of a Member State ‘where that practice reveals a “systematic approach”, the characteristics of which satisfy the requirements laid down [in that article]’, and that the possibility of taking such an administrative practice into account is not limited to situations in which there is no legal provision forming the basis of the scheme in question. (99) As is apparent from that judgment, however, the existence of that administrative practice generally implies that the other conditions are also fulfilled, since the conditions set in Article 1(d) of Regulation 2015/1589 are regarded by the Court as being ‘intrinsically linked’. (100) IV. The action before the General Court 197. Under the first paragraph of Article 61 of the Statute of the Court of Justice of the European Union, if the appeal is well founded and the Court of Justice quashes the decision of the General Court, it may itself give final judgment in the matter, where the state of the proceedings so permits. I consider this to be so in the present case. 198. It follows from the reasoning set out in points 101 to 113 and points 167 to 174 of this Opinion that the General Court committed an error of law, in the judgment under appeal, in approving the examination of the existence of an economic advantage on the basis of a reference framework comprising an arm’s length principle which does not derive from national tax law and thereby also infringed the provisions governing the division of competences between the European Union and its Member States. 199. Accordingly, the Court should, in my view, uphold the first and third parts of the first plea put forward by the Grand Duchy of Luxembourg in Case T‑755/15, as well as the first complaint in the first plea put forward by FFT in Case T‑759/15, and consequently annul the decision at issue. V. Costs 200. Under Article 184(2) of the Rules of Procedure of the Court of Justice, where the appeal is well founded and the Court itself gives final judgment in the case, the Court is to make a decision as to costs. 201. Under Article 138(1) of the Rules of Procedure, applicable to appeal proceedings by virtue of Article 184(1) thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since Ireland, FFT and the Grand Duchy of Luxembourg have applied for costs, the Commission should be ordered to pay the costs incurred by the Grand Duchy of Luxembourg before the General Court and those incurred by Ireland in the present appeal. Moreover, the Commission should be ordered to pay the costs incurred by FFT before the General Court and in the present appeal. 202. In accordance with Article 140(1) of the Rules of Procedure, the Member States and institutions which have intervened in the proceedings are to bear their own costs. The Grand Duchy of Luxembourg, intervener in the proceedings, must therefore bear its own costs relating to the present appeal. VI. Conclusion 203. In the light of the foregoing, I propose that the Court should: (1) Set aside the judgment of the General Court of the European Union of 24 September 2019, Luxembourg and Fiat Chrysler Finance Europe v Commission (T‑755/15 and T‑759/15, EU:T:2019:670); (2) Uphold the actions brought by the Grand Duchy of Luxembourg and Fiat Chrysler Finance Europe before the General Court of the European Union; (3) Annul Commission Decision (EU) 2016/2326 of 21 October 2015 on State aid SA.38375 (2014/C ex 2014/NN) which Luxembourg granted to Fiat; (4) Order the Commission to bear its own costs and to pay those incurred by the Grand Duchy of Luxembourg before the General Court, as well as the costs incurred by Ireland in the present appeal; and order the Commission to pay the costs incurred by Fiat Chrysler Finance Europe before the General Court and in the present appeal; (5) Order the Grand Duchy of Luxembourg to bear its own costs incurred in the present appeal. 1 Original language: French. 2 Commission Decision (EU) 2016/2326 of 21 October 2015 on State aid SA.38375 (2014/C ex 2014/NN) which Luxembourg granted to Fiat (OJ 2016 L 351, p. 1; ‘the decision at issue’). 3 This was a joint investigation by the International Consortium of Investigative Journalists (ICIJ) and 40 other media organisations. In that regard, see, in particular, the article published in the newspaper Le Monde, available at https://www.lemonde.fr/evasion-fiscale/article/2014/11/05/evasion-fiscale-tout-sur-les-secrets-du-luxembourg_4518895_4862750.html. 4 In that regard, see, inter alia, the document ‘Statement on a Two-Pillar Solution to Address the Tax Challenges Arising From the Digitalisation of the Economy’, discussed within the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting and approved by 137 countries on 8 October 2021, available at https://www.oecd.org/tax/beps/statement-on-a-two-pillar-solution-to-address-the-tax-challenges-arising-from-the-digitalisation-of-the-economy-october-2021.pdf. 5 Judgment of 24 September 2019, Luxembourg and Fiat Chrysler Finance Europe v Commission (T‑755/15 and T‑759/15, EU:T:2019:670; ‘the judgment under appeal’). 6 Recitals 9 and 52 to 54 of the decision at issue. 7 According to that article: ‘Taxable income comprises hidden profit distributions. A hidden profit distribution arises in particular when a shareholder, a stockholder or an interested party receives either directly or indirectly benefits from a company or an association which he or she normally would not have received if he or she had not been a shareholder, a stockholder or an interested party.’ It should be noted that that provision has not been in force since the Grand Duchy of Luxembourg introduced into the Income Tax Code new Articles 56 and 56a relating to the arm’s length principle on 1 January 2017. 8 Recitals 74 to 83 of the decision at issue. 9 Recitals 193 to 199 of the decision at issue. 10 Recitals 216 to 218 of the decision at issue. 11 Recitals 225 and 226 of the decision at issue. 12 Recitals 222 to 227 of the decision at issue. 13 Recitals 234 to 301 of the decision at issue. 14 Recitals 315 to 317 of the decision at issue. 15 Recitals 318 to 336 of the decision at issue. 16 Recitals 337 and 338 of the decision at issue. 17 Recitals 341 to 345 of the decision at issue. 18 Paragraphs 140 and 141 of the judgment under appeal. 19 Paragraph 143 of the judgment under appeal. 20 Paragraphs 145 and 148 of the judgment under appeal. 21 Paragraph 150 of the judgment under appeal. 22 Paragraph 155 of the judgment under appeal. 23 Paragraphs 156 to 158 of the judgment under appeal. 24 Paragraphs 160 and 161 of the judgment under appeal. 25 See Section 7.2.2.1 of the decision at issue (‘Selective advantage resulting from a deviation from the arm’s length principle’). 26 Judgment of 15 March 1994, Banco Exterior de España (C‑387/92, EU:C:1994:100, paragraphs 13 and 14). See also judgment of 15 November 2011, Commission and Spain v Government of Gibraltar and United Kingdom (C‑106/09 P and C‑107/09 P, EU:C:2011:732, paragraphs 71 and 72). 27 Judgment of 21 December 2016, Commission v World Duty Free Group and Others (C‑20/15 P and C‑21/15 P, EU:C:2016:981, paragraph 56 and the case-law cited). 28 See judgments of 26 September 1996, France v Commission (C‑241/94, EU:C:1996:353, paragraph 40), and of 12 December 2002, Belgium v Commission (C‑5/01, EU:C:2002:754, paragraphs 38 and 39). 29 See judgment of 9 October 2014, Ministerio de Defensa and Navantia (C‑522/13, EU:C:2014:2262, paragraph 27). 30 See, inter alia, judgment of 4 June 2015, Commission v MOL (C‑15/14 P, EU:C:2015:362, paragraph 60). 31 See, inter alia, judgments of 6 September 2006, Portugal v Commission (C‑88/03, EU:C:2006:511, paragraph 56), and of 21 December 2016, Commission v Hansestadt Lübeck (C‑524/14 P, EU:C:2016:971, paragraph 41). 32 Judgments of 21 December 2016, Commission v World Duty Free Group and Others (C‑20/15 P and C‑21/15 P, EU:C:2016:981); of 28 June 2018, Andres (Insolvency of Heitkamp BauHolding) v Commission (C‑203/16 P, EU:C:2018:505); and of 19 December 2018, A-Brauerei (C‑374/17, EU:C:2018:1024). 33 See judgments of 6 September 2006, Portugal v Commission (C‑88/03, EU:C:2006:511, paragraph 56); of 21 December 2016, Commission v Hansestadt Lübeck (C‑524/14 P, EU:C:2016:971, paragraph 55); of 28 June 2018, Andres (Insolvency of Heitkamp BauHolding) v Commission (C‑203/16 P, EU:C:2018:505, paragraph 88); and of 7 November 2019, UNESA and Others (C‑105/18 to C‑113/18, EU:C:2019:935, paragraph 62). 34 These criteria seem to me to be relevant irrespective of whether the State measure concerned has the nature of an aid scheme or of individual aid. The use of those criteria when determining ‘normal’ taxation in the case of an individual measure is necessary, in my view, to ensure the preservation of the exclusive competence of the Member States in the area of direct taxation. 35 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ 2016 C 262, p. 1), paragraph 133. 36 Judgment of 21 December 2016, Commission v World Duty Free Group and Others (C‑20/15 P and C‑21/15 P, EU:C:2016:981, paragraph 57). 37 Judgment of 6 October 2021, World Duty Free Group and Spain v Commission (C‑51/19 P and C‑64/19 P, EU:C:2021:793, paragraph 62). 38 Judgment of 6 October 2021, World Duty Free Group and Spain v Commission (C‑51/19 P and C‑64/19 P, EU:C:2021:793, paragraph 66). 39 Judgment of 6 October 2021, World Duty Free Group and Spain v Commission (C‑51/19 P and C‑64/19 P, EU:C:2021:793, paragraph 62 and the case-law cited). 40 Opinion of Advocate General Pitruzzella in World Duty Free Group and Spain v Commission (C‑51/19 P and C‑64/19 P, EU:C:2021:51, point 42) (emphasis added). 41 Judgment of 16 March 2021, Commission v Poland (C‑562/19 P, EU:C:2021:201). 42 Judgment of 16 March 2021, Commission v Hungary (C‑596/19 P, EU:C:2021:202). 43 Judgments of 16 March 2021, Commission v Poland (C‑562/19 P, EU:C:2021:201, paragraphs 37 to 39), and of 16 March 2021, Commission v Hungary (C‑596/19 P, EU:C:2021:202, paragraphs 43 to 45). 44 See judgments of 16 March 2021, Commission v Poland (C‑562/19 P, EU:C:2021:201, paragraph 45), and of 16 March 2021, Commission v Hungary (C‑596/19 P, EU:C:2021:202, paragraph 51). 45 OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, OECD, 2010, p. 39, paragraph 1.15. 46 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ 2016 C 262, p. 1). 47 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union, paragraph 170. 48 Judgment of 22 June 2006, Belgium and Forum 187 v Commission (C‑182/03 and C‑217/03, EU:C:2006:416; ‘the Forum 187 judgment’). 49 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union, paragraph 171 (emphasis added). 50 Decision to initiate the formal investigation procedure relating to State aid SA.38375 (2014/C) (ex 2014/NN) (ex 2014/CP) – Luxembourg, Alleged aid to FFT, C(2014) 3627 final. 51 Emphasis added. 52 Emphasis added. 53 Emphasis added. 54 Emphasis added. 55 Emphasis added. 56 See judgment of 24 January 2013, Frucona Košice v Commission (C‑73/11 P, EU:C:2013:32, paragraphs 87 to 90). 57 See judgment of 26 March 2020, Larko v Commission (C‑244/18 P, EU:C:2020:238, paragraphs 104 and 105). 58 Emphasis added. 59 At this stage, it is important to make clear that the suggested answer relates to a formal complaint concerning the reasoning for the decision at issue and not to any error of law committed by the General Court in its examination of the Commission’s assessment of the substance. The latter issue is covered solely by the fifth complaint, which will be examined below. 60 Judgment of 18 December 2014, FOA (C‑354/13, EU:C:2014:2463, paragraph 33). 61 See, inter alia, judgments of 15 October 2009, Audiolux and Others (C‑101/08, EU:C:2009:626, paragraph 34), and of 29 October 2009, NCC Construction Danmark (C‑174/08, EU:C:2009:669, paragraph 42). 62 Emphasis added. 63 Emphasis added. 64 See, in that regard, Mason, R., ‘Identifying Illegal Subsidies’, American University Law Review, Vol. 69: Issue 2, Article 3, pp. 530-531. 65 Commission Decision 2003/757/EC of 17 February 2003 on the aid scheme implemented by Belgium for coordination centres established in Belgium (OJ 2003 L 282, p. 25). 66 The Forum 187 judgment, paragraph 95. 67 The Forum 187 judgment, paragraph 96. 68 Moniteur belge of 13 January 1983. 69 Opinion of Advocate General Léger in Joined Cases Belgium and Forum 187 v Commission (C‑182/03 and C‑217/03, EU:C:2006:89). 70 Decision 2003/757, recital 95. In that regard, the Commission refers to No 26/48 of the commentary on the Belgian Income Tax Code 1992. 71 While it is true that, in paragraph 153 of the judgment under appeal, the General Court does not appear to refer to that legal basis when it merely summarises its conclusion as ‘the arm’s length principle is being applied in the context of the examination under Article 107(1) TFEU’, it is also true that that reference may be inferred from the General Court’s reasoning as a whole, according to which the legitimacy of the use of the arm’s length principle as a tool in the context of that examination depends on whether national law is aimed at taxing the profit resulting from the economic activity of an integrated undertaking as if it resulted from transactions carried out at market prices. 72 Judgment of 11 September 2019, Călin (C‑676/17, EU:C:2019:700, paragraph 50 and the case-law cited). 73 Judgment of 29 March 2011, ThyssenKrupp Nirosta v Commission (C‑352/09 P, EU:C:2011:191, paragraph 81). 74 Judgment of 23 September 2020, Spain and Others v Commission (T‑515/13 RENV and T‑719/13 RENV, EU:T:2020:434, paragraph 194). 75 See Puissochet, J.‑P. and Legal, H., Le principe de sécurité juridique dans la jurisprudence de la Cour de justice des Communautés européennes , Cahiers du Conseil constitutionnel, 2001, No 11. 76 See, for example, judgment of 8 December 2011, France Télécom v Commission (C‑81/10 P, EU:C:2011:811, paragraphs 99 to 108). 77 Judgment of 10 July 1986, Belgium v Commission (234/84, EU:C:1986:302, paragraph 14). 78 See, inter alia, Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union, Section 4.2. 79 Judgment of 28 June 2018, Andres (Insolvency of Heitkamp BauHolding) v Commission (C‑203/16 P, EU:C:2018:505, paragraph 107). 80 See judgment of 29 April 2021, Achemos Grupė and Achema v Commission (C‑847/19 P, not published, EU:C:2021:343, paragraph 60 and the case-law cited). 81 Emphasis added. 82 Emphasis added. 83 See the Forum 187 judgment, paragraphs 73 to 76, and Opinion of Advocate General Léger in Joined Cases Belgium and Forum 187 v Commission (C‑182/03 and C‑217/03, EU:C:2006:89, point 219). 84 See judgment of 14 November 2018, Commission v Greece (C‑93/17, EU:C:2018:903, paragraph 119 and the case-law cited). 85 Judgment of 4 June 2015, Commission v MOL (C‑15/14 P, EU:C:2015:362, paragraph 60). 86 Judgment of 26 October 2016, Orange v Commission (C‑211/15 P, EU:C:2016:798). 87 Judgment of 13 December 2017, Greece v Commission (T‑314/15, not published, EU:T:2017:903). 88 Specifically, the French legislation reduced the compensation which France Télécom was required to pay to the Treasury for the payment and servicing of the pensions of its civil servants. In the judgment, the Court confirmed the General Court’s finding that a comparison of the beneficiary with other operators in a comparable factual and legal situation in the light of the aim pursued by such a measure is irrelevant since that measure was ‘an ad hoc measure which concern[ed] just one undertaking and [wa]s intended to modify certain competitive constraints which [were] specific to the undertaking’. See judgment of 26 October 2016, Orange v Commission (C‑211/15 P, EU:C:2016:798, paragraphs 53 and 54). 89 Specifically, the Greek law ratifying the concession agreement between the public operator of the port of Piraeus and Piraeus Container Terminal SA set out a series of tax provisions in favour of the latter. In that judgment, the General Court reproduced the same wording as that previously used by the Court of Justice. See judgment of 13 December 2017, Greece v Commission (T‑314/15, not published, EU:T:2017:903, paragraph 81). 90 Judgment of 11 December 2019, Mytilinaios Anonymos Etairia – Omilos Epicheiriseon (C‑332/18 P, EU:C:2019:1065, paragraph 69), in which the Court held, in essence, that the presumption of selectivity applied in so far as the effects of that order ‘[had been] confined solely to the parties to the dispute in question’. 91 Council Regulation (EU) of 13 July 2015 laying down detailed rules for the application of Article 108 of the Treaty on the Functioning of the European Union (OJ 2015 L 248, p. 9). 92 Judgment of 16 September 2021, Commission v Belgium and Magnetrol International (C‑337/19 P, EU:C:2021:741, paragraph 60). 93 Judgment of 16 September 2021, Commission v Belgium and Magnetrol International (C‑337/19 P, EU:C:2021:741, paragraph 105). 94 Paragraphs 351 and 352 of the judgment under appeal. 95 Judgment of 21 December 2016, Commission v Hansestadt Lübeck (C‑524/14 P, EU:C:2016:971). 96 Judgment of 4 June 2015, Commission v MOL (C‑15/14 P, EU:C:2015:362). 97 Judgment of 4 June 2015, Commission v MOL (C‑15/14 P, EU:C:2015:362, paragraph 65). Emphasis added. 98 On that point, see also the Opinion of Advocate General Wahl in Commission v MOL (C‑15/14 P, EU:C:2015:32, point 67), according to which ‘it is necessary, bearing in mind the highly unusual nature of the measure at issue, to refrain from drawing any hasty analogy with previous examinations of the selectivity of schemes which the EU Courts have had occasion to hear and determine’. 99 Judgment of 16 September 2021, Commission v Belgium and Magnetrol International (C‑337/19 P, EU:C:2021:741, paragraphs 79 to 81). 100 See, inter alia, judgment of 16 September 2021, Commission v Belgium and Magnetrol International (C‑337/19 P, EU:C:2021:741, paragraphs 106 and 121).