Opinion of the Advocate General — ECLI:EU:C:2015:32
Date: 2015-01-22
Language of the case: English
Subject matter: State aids;Competition
Procedure: Action for annulment;Appeal - unfounded
Origin: Hungary

summary of the Commission’s line of argument 69. By its first head of complaint, the Commission criticises the General Court’s analysis of the discretion enjoyed by the Hungarian authorities, on the one hand, with regard to the choice of whether or not to conclude an extension agreement in the case where a mining undertaking submits a request to that effect and, on the other hand, with regard to the level of the fee which they set in such an agreement. It also criticises the conclusion which the General Court drew from that analysis with respect to the selective nature of the contested aid measure. 70. In the Commission’s view, the General Court failed to take into account the conclusions to be drawn from case-law (27) with regard to the examination of the discretion enjoyed by the competent national authorities for the purpose of concluding whether the contested measure is selective. 71. The Commission submits, first of all, that, on receipt of a request under Article 26/A(5) of the Mining Act, the Hungarian authorities enjoy a measure of discretion in deciding whether or not to conclude an agreement extending mining rights. The General Court’s analysis in paragraphs 70 to 74 and 79 to 81 of the judgment under appeal, it contends, is erroneous and the conclusion contained in paragraph 83 of that judgment, to the effect that the selective nature of the measure has not been established, should be overturned. 72. The Commission also takes the view that, even if it is assumed that, in this instance, the Hungarian authorities were required to conclude an agreement extending mining rights when presented with a request to that effect by an undertaking, the General Court’s analysis is not for that matter any less erroneous in law, given that it disregards the ‘unlimited’ latitude extended to those authorities with respect to the level of the mining fee set by them, a finding which, moreover, it seems to have reiterated, at least in part, in paragraph 72 of the judgment under appeal. In ruling that the discretionary power conferred on the national authorities by the legislative framework as regards the level of the mining fee was such as to render the 2005 agreement selective, the General Court failed, in the Commission’s opinion, to have regard to its own case-law. b) My assessment 73. It is appropriate at the outset to provide some clarification with regard to the review that the Court is called upon to carry out here. After all, it is well-established case-law that, where the General Court has established or assessed the facts, the Court of Justice has jurisdiction, under Article 256 TFEU, solely to review the legal characterisation of those facts and the conclusions in law drawn from them. The assessment of the facts is not therefore, other than in cases where the evidence produced before the General Court has been distorted, a question of law which is subject, as such, to review by the Court of Justice. (28) 74. The question here is whether it is possible to identify, in the context of the assessment of the discretion enjoyed by the national authorities in concluding an agreement extending mining rights, any distortion of the facts, any error of law or any error in the legal characterisation of the facts. 75. In my view, that question must be answered in the negative. 76. First, with regard to the determination of whether there has been a distortion of the facts, it is sufficient to point out that the Commission has not pleaded any such distortion. In any event, it is my view that there is no evidence to support the conclusion that the General Court arrived at findings that were manifestly at odds with the content of the provisions of Hungarian law at issue or that it attached to any one of them a significance which it manifestly does not have in relation to the other elements of the case-file. 77. Secondly, it is necessary to establish whether the General Court’s analysis concerning the discretion enjoyed by the Hungarian authorities, set out in paragraphs 70 to 74 and 79 to 81 of the judgment under appeal, is vitiated by any error of law or error in the legal characterisation of the facts. 78. I am not convinced that that is the case. 79. With regard, first of all, to paragraphs 70 to 74 of the judgment under appeal, it is important to point out that their purpose was to analyse the legal framework in the light of which the 2005 agreement had been concluded. From that point of view, and with respect to the examination of the discretion enjoyed by the Hungarian authorities in concluding the 2005 agreement, the General Court simply drew the inference, based on a detailed examination of the parameters and conditions for concluding agreements extending mining rights, that Article 26/A(5) of the Mining Act, which allows any mining undertaking to request an extension of its mining rights in respect of one or more fields which it has not put into production within five years from the date on which authorisation was granted, did not appear to be selective in nature. 80. Contrary to what the Commission has argued, I am not convinced that those assessments contain any error whatsoever in the legal characterisation of the facts or any error of law. 81. In this regard, the present case must be distinguished clearly from those mentioned by the Commission in support of its argument calling into question the assessment of the discretion conferred on the Hungarian authorities when concluding agreements extending mining rights. (29) The case-law precedents mentioned by the Commission in its appeal relate to provisions of national law granting relief on taxes or other charges, or exceptions in matters of insolvency. 82. Thus, in the case that gave rise to the judgment in France v Commission (EU:C:1996:353), which concerned a Commission decision relating to aid granted to Kimberly Clark Sopalin, the Court held that the contested intervention of the Fonds national de l’emploi (National Employment Fund) (FNE) in the implementation of social plans was liable to place certain undertakings in a more favourable situation than others, since the FNE enjoyed a degree of latitude which enabled it to adjust its intervention in accordance with a number of considerations. As Advocate General Jacobs pointed out in that case, the discretion and degree of discretion enjoyed by the FNE in the administration of the aid scheme meant that the FNE contributions were not necessarily available to all undertakings on an equal footing. (30) 83. Similarly, in the case that gave rise to the judgment in Ecotrade (EU:C:1998:579, paragraph 43), the Court held that the scheme derogating from the general rules in matters of insolvency which was at issue in the main proceedings fulfilled the specificity condition and was such as to entail ‘an additional burden for the State’, in the form of various advantages granted by the public authorities, as compared with the advantages that would have followed from application of the ordinary insolvency provisions. 84. The circumstances of the case at issue here are entirely different. The fact that the agreement extending rights related to only one undertaking does not necessarily constitute evidence that the agreement is selective in nature. The correct comparator for establishing whether or not the contested measure was selective was to ascertain whether the procedure for concluding and setting the terms and conditions of the agreement extending mining rights was open to undertakings which were in a comparable situation. 85. In my view, one cannot but subscribe to the statement made in paragraph 72 of the judgment under appeal to the effect that ‘[m]ore broadly, it must be observed that the margin of assessment at issue here can be distinguished, by its nature, from cases where the exercise of such a margin is connected with the grant of an advantage in favour of an economic operator. In the present case, the Hungarian authorities’ margin of assessment allows the fixing of an additional charge on economic operators in such a manner as to take account of the imperatives arising from the principle of equal treatment’. 86. In my view, there is a fundamental difference between the assessment of the selectivity of general schemes for exemption or relief, which, by definition, automatically confer an advantage, and that of optional provisions of national law prescribing the imposition of additional charges. In cases where the national authorities impose such charges in order to maintain equal treatment between operators, the simple fact that the national authorities enjoy discretion which is defined by law — and not unlimited, as the Commission stated in its appeal — cannot be sufficient to establish that the corresponding scheme is selective. 87. I therefore take the view that the General Court did not err in law in stating, in paragraph 74 of the judgment under appeal, that ‘the fact that the rates set by year of validity of that agreement are the result of negotiation does not suffice to confer on that agreement a selective character’ and that ‘the situation would have been different only if the Hungarian authorities had exercised their margin of assessment … in such a way as to favour the applicant by agreeing to a low fee level without any objective reason having regard to the rationale of increasing fees in the event of an extension of authorisation and to the detriment of any other operator which has sought to extend its mining rights or, in the absence of such an operator, where there is concrete evidence that unjustified favourable treatment has been reserved to the applicant’. 88. With regard to paragraphs 79 to 81 of the judgment under appeal, which consist essentially of a number of factual findings concerning the fixing of fee rates in contracts for the extension of mining rights, these too do not appear to contain any error of law or error in the legal characterisation of factors relevant to the examination as to whether the contested measure was selective. 89. Consequently, I am of the opinion that, in order not to proceed with a defective reading of the judgment under appeal, the first limb of the line of argument put forward by the Commission in its single ground of appeal cannot be accepted. 2. Second head of complaint: examination of selectivity and consideration of objective criteria a) Brief summary of the Commission’s line of argument 90. By its second head of complaint, the Commission submits that the General Court erred in concluding, in paragraphs 76 to 78 of the judgment under appeal, that the presence of objective criteria necessarily ruled out any possibility of selectivity. After all, it argues, that assertion is clearly at odds with the conclusions to be drawn from the case-law of the Court and the General Court. (31) The aforementioned passages of the judgment and the conclusion contained in paragraphs 81 and 83 of that judgment, to the effect that the selective nature of the measures at issue cannot be regarded as established, are therefore, the Commission submits, open to censure. b) My assessment 91. In my view, this line of argument proceeds from an erroneous reading of that section of the judgment under appeal, which relates solely to the mechanism for extending agreements concluded with mining undertakings, as provided for in Article 26/A(5) of the Mining Act and implemented in respect of MOL in 2005. The principal issue there, unlike the situation in the case-law precedents mentioned by the Commission, was not an examination as to whether or not the beneficiaries of State aid schemes were selected on the basis of objective criteria. 92. In this regard, the General Court first of all noted, in paragraph 76 of the judgment under appeal, that the Mining Act was drafted in general terms as regards the undertakings eligible for the extension. 93. Next, the General Court held, in paragraph 77 of the judgment under appeal, that the fact that MOL was the only undertaking in practice to have concluded an extension agreement in the hydrocarbons sector was not necessarily decisive. Since the criteria for the conclusion of such an agreement were objective and applicable to any potentially interested operator, the absence of other agreements of that kind would not necessarily constitute evidence of the selective nature of the measure, but could result from decisions by undertakings themselves not to apply for extensions. 94. Lastly, the General Court stated, in paragraph 78 of the judgment under appeal, that the mining fees set for the term of the agreement result simply from the application of the provisions of the Mining Act. 95. All of those considerations form part of the process by which the General Court determines whether or not the mining fee rate was set on the basis of objective criteria which were applicable to any potentially interested operator. 96. Those considerations do not in any way run counter to the case-law, referred to by the Commission, to the effect that a particular aid scheme cannot be cleared of being selective solely on the ground that the beneficiaries are selected on the basis of objective criteria. 97. Thus, in the judgment in Spain v Commission (EU:C:2003:92), the Court, called upon to give a ruling on an aid regime consisting essentially of a scheme for loans on preferential terms operated by the Spanish authorities with a view to promoting the purchase of commercial vehicles, simply rejected as irrelevant the argument, put forward at that time by the Kingdom of Spain, to the effect that ‘the Agreement [was] governed by objective criteria of horizontal application’. The Court stated that such an argument served only to show that the aid at issue formed part of a scheme of aid rather than being an individual aid measure. (32) 98. As regards the judgment in GEMO (EU:C:2003:622), which concerned a scheme for the free collection and destruction of animal carcases and slaughterhouse waste, the Court again held that, despite the fact that the beneficiaries of the scheme adopted by national law were defined on the basis of objective and apparently general criteria, its benefits accrued largely to farmers and slaughterhouses. (33) 99. Similar considerations were set out in the judgment in Italy v Commission (EU:T:2009:49), which concerned a scheme granting a reduced rate of tax on the income of undertakings for collective investment in transferable securities specialising in shares of small- and medium-capitalisation companies. The General Court had thus held that ‘the mere fact that the measure at issue may benefit any investment vehicle fulfilling the conditions laid down, that is to say, determines its scope on the basis of objective criteria, does not in itself establish the general nature of that measure and does not preclude it from being selective in nature’. (34) 100. In the present case, the General Court did not in any way fail to take into account the conclusions to be drawn from that case-law. Notwithstanding the fact that MOL was the only undertaking to apply for an extension of its mining rights, Article 26/A of the Mining Act does not differentiate between one category of operator and another. 101. Consequently, I propose that the second head of complaint raised by the Commission be rejected. 3. Third head of complaint: examination of selectivity and alleged consideration of the State authorities’ intention to grant an advantage a) Brief summary of the Commission’s line of argument 102. By its third head of complaint, the Commission essentially criticises the General Court for having, in particular in paragraphs 67 and 82 of the judgment under appeal, linked the assessment of the selectivity of the contested measure to whether or not the Member State had the intention, at the time of concluding the 2005 agreement, to protect one or more operators from the application of a new fee regime — in this instance, the regime introduced when the Mining Act was amended in 2008. 103. In the Commission’s view, the General Court failed to take into account a fundamental aspect of the rules applicable in matters of State aid, namely the requirement that the State intervention referred to in Article 107(1) TFEU must be defined by reference to the effects of the measure at issue. (35) It is therefore appropriate, it submits, to set aside that passage of the judgment under appeal and the conclusion contained in paragraph 83 of that judgment to the effect that the selective nature of the contested measure had not been established. b) My assessment 104. This third aspect of the Commission’s line of argument is also unconvincing. 105. It is true that, according to well-established case-law, Article 107(1) TFEU does not distinguish by reference to the causes or aims of measures of State intervention but defines them in relation to their effects. This means, in particular, that the selectivity of a national measure must be assessed by reference to its effects and not in relation to the stated or alleged intention of the Member State concerned to protect one or more economic operators. (36) 106. To my mind, however, the General Court did not disregard that principle when referring, in paragraph 67 of the judgment under appeal, to the question of whether ‘the State acts in such a way as to protect one or more operators already present on the market, by concluding with them an agreement granting them fee rates guaranteed for the entire duration thereof, whilst having the intention at that time of subsequently exercising its regulatory power, by increasing the fee rate so that other market operators are placed at a disadvantage, be they operators already present on the market on the date on which the agreement was concluded or new operators’. 107. By that paragraph, and as is clear from the express reference to the case that gave rise to the judgment in Bouygues and Bouygues Télécom v Commission and Others and Commission v France and Others, (37) the General Court sought, for the sake of completeness (38) and independently of the actual examination of the selectivity of the contested measure, to raise the question of whether there were any links between the 2005 agreement and the 2008 legislative amendment. 108. Similarly, in paragraph 82 of the judgment under appeal, with the objective once again, in my view, of satisfying itself that the 2005 agreement and the 2008 amendment to the Mining Act did not necessarily have to be viewed as one and the same measure, given the lack of any chronological and functional links between those two interventions, the General Court pointed out, first, that the increase in fees, which came into force in 2008, occurred in a context of an increase in international crude oil prices and, secondly, that the Commission had not argued that the 2005 agreement had been concluded in anticipation of an increase in mining fees. 109. While it may be regrettable, as I mentioned earlier (see points 58 and 61 of this Opinion), that the General Court did not distinguish more clearly between the examination of the precise identification of the contested measure (set out in paragraphs 67 and 82 of the judgment under appeal) and the assessment of the selective nature of the measure once it had been identified, it would, in my view, be wrong to state that the General Court linked the selectivity of the measure at issue to evidence that the Member State had intended to protect one or more operators. 110. Consequently, I am of the opinion that the third head of complaint raised by the Commission should also be rejected. 4. Fourth head of complaint: examination of selectivity and consideration of ‘conditions external’ to the 2005 agreement a) Brief summary of the Commission’s line of argument 111. The Commission takes the view that the General Court was wrong to consider, in paragraphs 64 and 65 of the judgment under appeal, that the presence of a selective advantage could not be deduced from the mere fact that the operator is left better off than other operators, based on the mere fact, in this instance, that the Member State concerned justifiably exercised its regulatory powers following a change on the market. The Commission’s complaint is essentially that, in referring to the subsequent change in conditions external to the 2005 agreement, the General Court disregarded the case-law to the effect that, for the purposes of the application of Article 107(1) TFEU, it makes no difference whether the situation of the presumed beneficiary of the measure is better or worse over time. (39) What is relevant, the Commission submits, is that, after 8 January 2008, MOL was the only undertaking to enjoy preferential treatment in relation to the level of fee applicable to hydrocarbon fields. 112. In any event, the Commission points out, the factors taken into consideration by the General Court cannot be relevant, since the change at issue in this instance was a legislative amendment on which the State was free to decide as it saw fit. That approach, which authorises Member States to argue that measures are not selective by reason of the methods or techniques that they use, fails to take into account the conclusions to be drawn from the relevant case-law. (40) b) My assessment 113. Here again, a careful reading of paragraphs 64 and 65 of the judgment under appeal leads me to conclude that the Commission’s head of complaint should be rejected. 114. While there may indeed be cause to regret a degree of confusion in the line of reasoning adopted by the General Court, which mixes preliminary considerations with the substantive examination of the selectivity of the 2005 agreement, the aforementioned two paragraphs do not appear to relate stricto sensu to the examination of the selectivity of the 2005 agreement but, as is clear from the continuation of the General Court’s line of reasoning in paragraphs 66 and 67 of the judgment under appeal, seek to address the separate matter of the links between the 2005 agreement and the subsequent legislative amendments. It was in the light of the latter issue, in my view, that the General Court considered it expedient to point out, in paragraph 64 of the judgment under appeal, that, ‘where a Member State concludes with an economic operator an agreement which does not involve any State aid element for the purposes of Article 107 TFEU, the fact that, subsequently, conditions external to such an agreement change in such a way that the operator in question is in an advantageous position vis-à-vis other operators that have not concluded a similar agreement is not a sufficient basis on which to conclude that, together, the agreement and the subsequent modification of the conditions external to that agreement can be regarded as constituting State aid’. 115. The Commission’s assertion that ‘[w]hat is relevant is that, after 8 January 2008, MOL was in a position in which it was uniquely preferred’ fails to take into account the fact that the discussion was concerned only with whether the 2005 agreement was selective; it did not consider the possible selectivity of the contested measure resulting from the 2008 amendment. In other words, and by way of extension from my earlier point, the Commission is wrong, in my opinion, to connect the examination of selectivity in this case with the existence of the advantage that is alleged to have followed from the 2008 legislative amendment. 116. To my mind, the General Court did not err in law in stating that, once it was established that a measure, in this case the agreement on mining fees concluded between the Hungarian authorities and MOL, was not selective, that measure should no longer be called into question by the fact that changes in the market were liable to place it in a more favourable situation compared with that of operators which had decided not to enter into such a contract. 117. For all of the foregoing reasons, I take the view that this last head of complaint should be rejected and that the appeal should, consequently, be dismissed in its entirety. V – Conclusion 118. In the light of the foregoing considerations, I propose that the Court should: (1) dismiss the appeal; (2) order the European Commission to pay the costs. 1 Original language: French. 2 T‑499/10, EU:T:2013:592; ‘the judgment under appeal’. 3 OJ 2011 L 34, p. 55; ‘the contested decision’. 4 1993. évi XLVIII. törvény a bányászatról; ‘the Mining Act’. 5 2007. évi CXXXIII. törvény a bányászatról szóló 1993. évi XLVIII. törvény módosításáról; ‘the amended Mining Act’. 6 2008. évi LXXXI. törvény egyes adó- és járuléktörvények módosításáról. 7 Council Regulation of 22 March 1999 laying down detailed rules for the application of Article [108 TFEU] (OJ 1999 L 83, p. 1). 8 See paragraphs 67 and 82 of the judgment under appeal. 9 See paragraphs 75 to 81 of the judgment under appeal. 10 See paragraphs 68 and 83 of the judgment under appeal. 11 Judgment in Commission v Deutsche Post (C‑399/08 P, EU:C:2010:481, paragraph 38 and the case-law cited). 12 Judgment in Commission v Deutsche Post (EU:C:2010:481, paragraph 39 and the case-law cited). 13 See the judgment in Commission v Netherlands (C‑279/08 P, EU:C:2011:551, paragraph 62). 14 Even though it has been pointed out that the concept of discrimination may appear ambiguous, so far as aid is concerned, since discrimination necessarily implies the existence of undertakings or products in an identical situation, and therefore in competition, which are excluded from the benefit of the contested measure (see the Opinion of Advocate General Darmon in Sloman Neptun, C‑72/91 and C‑73/91, EU:C:1992:130, point 61). 15 In this regard, it is interesting to note that, in its action before the General Court, MOL, first of all (see paragraphs 38 to 44 of the application before the General Court), criticised the Commission for having taken the view, in the contested decision, that the 2005 agreement and the 2008 legislative amendment together constituted a single measure. To use the language employed by MOL in its application, the Commission committed an error of law in deciding that the 2005 agreement and the 2008 amendment to the Mining Act constitute a single aid measure, when it had accepted that each of those two separate measures did not in itself constitute an aid measure. It was only later that MOL argued that, assuming this to be the case, that single measure could not be regarded as selective in nature. 16 See the findings set out in paragraphs 62 and 63 of the judgment under appeal and in recitals 19 (in the statement of the grounds on which the investigation procedure was initiated) and 53 (in the actual assessment of the measure at issue) of the contested decision. 17 See recitals 53 and 69 of the contested decision. 18 See the judgment in Bouygues and Bouygues Télécom v Commission and Others and Commission v France and Others (C‑399/10 P and C‑401/10 P, EU:C:2013:175, paragraph 104 and the case-law cited). 19 See recitals 62 to 68 of the contested decision. 20 See the terms used in recital 53 of the contested decision. 21 See the findings of the General Court in paragraph 46 of the judgment under appeal. 22 EU:C:2013:175. 23 Judgment in Bouygues and Bouygues Télécom v Commission and Others and Commission v France and Others (EU:C:2013:175, paragraphs 103 and 104). 24 The question of the links between the various State interventions at issue in this case seems, however, by contrast with the contested decision, to have been the subject of a brief examination in paragraph 82 of the judgment under appeal. 25 See recital 61 of the contested decision. 26 See, to that effect, the judgment in Portugal v Commission (C‑88/03, EU:C:2006:511, paragraph 56). 27 The Commission refers both to the case-law of the Court of Justice (judgments in France v Commission, C‑241/94, EU:C:1996:353, paragraphs 23 and 24; Ecotrade, C‑200/97, EU:C:1998:579, paragraph 40; Piaggio, C‑295/97, EU:C:1999:313, paragraph 39; DM Transport, C‑256/97, EU:C:1999:332, paragraph 27; and P, C‑6/12, EU:C:2013:525, paragraph 27) and to that of the General Court (judgments in HAMSA v Commission, T‑152/99, EU:T:2002:188, paragraphs 156 and 157; Lenzing v Commission, T‑36/99, EU:T:2004:312, paragraphs 129 to 132; Diputación Foral de Álava and Others v Commission, T‑127/99, T‑129/99 and T‑148/99, EU:T:2002:59, paragraphs 152 and 154; and Diputación Foral de Álava and Others v Commission, T‑227/01 to T‑229/01, T‑265/01, T‑266/01 and T‑270/01, EU:T:2009:315, paragraph 168). 28 See the judgment in Council v Alumina (C‑393/13 P, EU:C:2014:2245, paragraph 16 and the case-law cited). 29 In this regard, the Commission cites the judgments in France v Commission (EU:C:1996:353, paragraphs 23 and 24); Ecotrade (EU:C:1998:579, paragraph 40); Piaggio (EU:C:1999:313, paragraph 39); DM Transport (EU:C:1999:332, paragraph 27); and Diputación Foral de Álava and Others v Commission (EU:T:2002:59, paragraph 152). 30 Opinion of Advocate General Jacobs in France v Commission (C‑241/94, EU:C:1996:195, points 38 and 57). 31 See, inter alia, the judgments in Spain v Commission (C‑409/00, EU:C:2003:92, paragraph 49); GEMO (C‑126/01, EU:C:2003:622, paragraphs 35 and 39); and Italy v Commission (T‑424/05, EU:T:2009:49, paragraph 126). 32 See paragraph 49 of that judgment. See also the Opinion of Advocate General Alber in that case (C‑409/00, EU:C:2002:475, points 57 and 58). 33 See paragraphs 35 to 39 of that judgment. See also the Opinion of Advocate General Jacobs in that case (C‑126/01, EU:C:2002:273, points 79 to 83). 34 See paragraph 126 of that judgment. 35 The Commission refers in particular to the judgments in Belgium v Commission (C‑56/93, EU:C:1996:64, paragraph 79) and Belgium v Commission (C‑75/97, EU:C:1999:311, paragraph 25). 36 See, inter alia, the judgments in Belgium v Commission (EU:C:1996:64, paragraph 79); British Aggregates v Commission (C‑487/06 P, EU:C:2008:757, paragraph 89); Commission v Netherlands (C‑279/08 P, EU:C:2011:551, paragraph 51); and Commission and Spain v Government of Gibraltar and United Kingdom (C‑106/09 P and C‑107/09 P, EU:C:2011:732, paragraphs 91 and 92). 37 EU:C:2013:175, paragraphs 103 and 104. 38 See the use of the word ‘moreover’ at the beginning of paragraph 67 of the judgment under appeal. 39 Judgments in Greece v Commission (57/86, EU:C:1988:284, paragraph 10), and Adria-Wien Pipeline and Wietersdorfer & Peggauer Zementwerke (C‑143/99, EU:C:2001:598, paragraph 41). 40 See the judgments in British Aggregates v Commission (EU:C:2008:757, paragraph 89); Commission v Netherlands (EU:C:2011:551, paragraph 51); and Commission and Spain v Government of Gibraltar and United Kingdom (EU:C:2011:732, paragraphs 91 and 92).