Judgment — ECLI:EU:C:2003:373
Date: 2003-06-26
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: State aids;Competition
Concepts: Defences;Recovery of undue payment;Obligations of the Member States;Implementation of the Commission decision and recovery
Procedure: Action for failure to fulfil obligations - successful
Origin: Spain

Summary of the Judgment 
1. Actions for failure to fulfil obligations — Non-compliance with a Commission 
decision on State aid — Pleas in defence — Plea alleging that the decision is 
unlawful — Inadmissible — Limits — Non-existent measure 
(Art. 88(2), second subpara., EC, Arts 226 EC, 227 EC, 230 EC and 232 EC) 
2. Actions for failure to fulfil obligations — Non-compliance with a Commission 
decision on State aid — Pleas in defence — Absolutely impossible to implement 
(Art. 88(2) EC) 
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SUMMARY — CASE C-404/00 
3. State aid — Commission decision finding aid incompatible with the common 
market — Difficulties of implementation — Obligation of the Commission and the 
Member State to cooperate in seeking a solution compatible with the Treaty 
(Arts 10 EC and 88(2) EC) 
4. State aid — Recovery of unlawful aid — Application of national law — Conditions 
and limitations — Interests of the Community to be taken into account 
(Art. 88(2), first subpara., EC) 
1. The system of remedies set up by the 
Treaty distinguishes between the 
r e m e d i e s p r o v i d e d for in 
Articles 226 EC and 227 EC, which 
permit a declaration that a Member 
State has failed to fulfil its obligations, 
and those contained in Articles 230 EC 
and 232 EC, which permit judicial 
review of the lawfulness of measures 
adopted by the Community institu­
tions, or the failure to adopt such 
measures. Those remedies have differ­
ent objectives and are subject to dif­
ferent rules. In the absence of a provi­
sion of the Treaty expressly permitting 
it to do so, a Member State cannot, 
therefore, properly plead the unlawful­
ness of a decision addressed to it as a 
defence in an action for a declaration 
that it has failed to fulfil its obligations 
arising out of its failure to implement 
that decision. The position could be 
different only if the measure in ques­
tion contained such particularly serious 
and manifest defects that it could be 
deemed non-existent. 
That finding also applies in an action 
for failure to fulfil obligations brought 
under the second subparagraph of 
Article 88(2) EC. 
(see paras 40-42) 
2. The only defence available to a 
Member State in opposing an infringe­
ment action by the Commission under 
Article 88(2) EC is to plead that it was 
absolutely impossible for it to imple­
ment the decision properly. 
(see para. 45) 
3. A Member State which, in giving effect 
to a Commission decision on State aid, 
encounters unforeseen and unfore­
seeable difficulties or becomes aware 
of consequences overlooked by the 
Commission must submit those prob­
lems to the Commission for consider-
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COMMISSION v SPAIN 
ation, together with proposals for suit­
able amendments to the decision in 
question. In such a case, the Commis­
sion and the Member State must, by 
virtue of the rule imposing on the 
Member States and the Community 
institutions a duty of genuine cooper­
ation which underlies, in particular, 
Article 10 EC, work together in good 
faith with a view to overcoming the 
difficulties whilst fully observing the 
Treaty provisions and, in particular, 
the provisions on aid. 
(see para. 46) 
4. Although, in the absence of Commu­
nity provisions relating to the pro­
cedure applicable to the recovery of 
illegal aid, such recovery must take 
place, in principle, in accordance with 
the relevant provisions of national law, 
those provisions must however be 
applied in such a way that the recovery 
required by Community law is not 
rendered practically impossible and 
the interests of the Community are 
taken fully into consideration. 
(see para. 51) 
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