62021CJ0701_RES
Joined Cases C‑701/21 P and C‑739/21 P
Mytilinaios AE – Omilos Epicheiriseon
v
Dimosia Epicheirisi Ilektrismou AE (DEI)andEuropean Commission
Judgment of the Court (Fourth Chamber) of 22 February 2024
(Appeal – State aid – Article 107 TFEU – Concept of ‘aid’ – Advantage – Private investor test – Arbitration award setting reduced electricity tariffs – Whether the arbitration award can be imputed to the State – Regulation (EU) 2015/1589 – Article 4(2) – Decision that the measure does not constitute aid)
Action for annulment – Natural or legal persons – Interest in bringing proceedings – Commission decision finding no State aid without opening the formal investigation procedure – Action designed to safeguard the procedural rights of the parties concerned – Action brought by an undertaking controlled by a Member State – Admissibility
(Arts 108(2) and (3) and 263, fourth para., TFEU; Council Regulation 2015/1589, Art. 1(h))
(see paragraphs 56-64)
Aid granted by a Member State – Concept – Grant of advantages imputable to the State – Arbitration tribunal involved in setting an electricity tariff – Decision of an undertaking controlled by the State to conclude an arbitration agreement – Decision capable of constituting State aid – Arbitration award adopted by an arbitration tribunal appointed by contract – Arbitration award not constituting a measure attributable to the State
(Art. 107(1) TFEU)
(see paragraphs 96-114)
Résumé
The Court of Justice upholds the appeals brought against the judgment of the General Court (
1
) annulling a number of Commission measures whereby it concluded that an arbitration award setting the electricity supply tariff applicable to the Greek aluminium producer Mytilinaios AE – Omilos Epicheiriseon (‘Mytilinaios’) did not involve the grant of State aid. According to the Court of Justice, the General Court erred in law in classifying that arbitration award as a State measure capable of constituting State aid.
Dimosia Epicheirisi Ilektrismou AE (DEI), an electricity producer and supplier controlled by the Greek State, and Mytilinaios, which is its main customer, are involved in a long-running dispute concerning the electricity supply tariff which DEI charges to Mytilinaios, since those parties have been unable to agree on the amount of that tariff. Under an arbitration agreement signed on 16 November 2011, the two parties agreed to entrust the resolution of their dispute to the Rythmistiki Archi Energeias (Greek Energy Regulator, Greece; ‘the RAE’) by which a permanent arbitration body is established under Greek law (‘the arbitration tribunal of the RAE’). The arbitration tribunal of the RAE was entrusted with the task of determining, on the basis of negotiations which took place between DEI and Mytilinaios, the electricity supply tariff corresponding to the specific characteristics of Mytilinaios and covering at least the costs borne by DEI.
By decision of 31 October 2013 (‘the arbitration award’), the arbitration tribunal of the RAE set the energy tariff applicable to Mytilinaios. The action brought by DEI against that arbitration award was dismissed by the Efeteio Athinon (Court of Appeal, Athens, Greece).
On 23 December 2013, DEI lodged a complaint with the European Commission, maintaining that the arbitration award constituted unlawful State aid, in so far as the tariff in question obliged DEI to supply Mytilinaios with electricity at a price below its costs. By letter of 12 June 2014 (‘the letter at issue’), the Commission informed DEI that no further action would be taken on its complaint.
Following that letter, DEI brought an action before the General Court, registered as Case T‑639/14, seeking the annulment of the letter at issue.
During those proceedings, the Commission, by decision of 25 March 2015 (‘the first decision at issue’), (
2
) withdrew and replaced the letter at issue. In that decision, it found that the arbitration award did not constitute aid granted to Mytilinaios, since DEI’s voluntary referral of their dispute to arbitration was consistent with the conduct of a prudent investor operating in a market economy and, therefore, did not grant an advantage to Mytilinaios.
DEI subsequently brought an action before the General Court, registered as Case T‑352/15, seeking the annulment of the first decision at issue.
By order of 6 February 2016, the General Court found that there was no longer any need to adjudicate on the action in Case T‑639/14. Hearing the appeal, the Court of Justice (
3
) however set aside that order and referred the case back to the General Court where it was registered as Case T‑639/14 RENV.
On 14 August 2017, the Commission adopted a second decision (‘the second decision at issue’), (
4
) repealing and replacing both the letter at issue and the first decision at issue. Relying on identical reasoning to that set out in the first decision at issue, the second decision at issue confirms that the arbitration award does not involve the grant of State aid within the meaning of Article 107(1) TFEU.
DEI once more brought an action before the General Court for the annulment of the second decision at issue, registered as Case T‑740/17.
After joining the three pending cases, the Third Chamber, Extended Composition, of the General Court upheld the three actions brought by DEI and annulled both the letter at issue and the first and second decisions at issue.
In its judgment, the General Court found that the Commission ought to have initiated the formal investigation procedure under Article 108(2) TFEU in order to assess the content of the arbitration award from the perspective of the possible grant of State aid, since the arbitration tribunal of the RAE could be treated in the same way as an ordinary State court, and that it follows from the case-law that an advantage granted by such a court to a party to the proceedings is capable of being regarded as the grant of State aid.
Mytilinaios and the Commission brought appeals against that judgment before the Court of Justice.
Findings of the Court
In support of their appeals, Mytilinaios and the Commission argue, inter alia, that the General Court erred in law in finding that the arbitration tribunal of the RAE could be treated in the same way as an ordinary State court, which has the effect of the arbitration award being established as a State measure capable of constituting State aid.
In that respect, the Court of Justice observes, in the first place, that the criteria adopted by the General Court in order to treat the arbitration tribunal of the RAE as similar to an ordinary State court do not make it possible to distinguish the arbitration tribunal of the RAE from any other arbitration tribunal appointed by contract. In that regard, the Court of Justice notes that the only criterion, relied on by the General Court, capable of distinguishing the arbitration tribunal of the RAE from other arbitration tribunals appointed by contract is the fact that its arbitrators, selected from a list drawn up by decision of the President of the RAE, must demonstrate their independence and their impartiality before their appointment. However, that fact cannot, in itself, make it possible to find that that arbitration tribunal is to be distinguished from any other arbitration tribunal appointed by contract, since it constitutes merely a purely procedural element which does not affect the function or the nature of that tribunal.
The Court of Justice considers, in the second place, that the General Court erred in law in failing to ascertain whether the arbitration tribunal of the RAE had, as is the case, generally, for courts which form part of the State judicial system, mandatory jurisdiction which therefore did not depend solely on the will of the parties.
In the light of the foregoing, the Court of Justice holds that the General Court erred in law in finding that the arbitration tribunal of the RAE could be treated in the same way as an ordinary court and that the arbitration award was a State measure capable of constituting State aid.
That assessment cannot be called into question by the fact that, in the judgment in Commission v European Food and Others, (
5
) the Court of Justice confirmed that the Commission was competent to review whether compensation paid to Swedish investors by Romania pursuant to an arbitration award constituted State aid or not.
In that respect, the Court states, first, that the arbitration tribunal which made the arbitration award in question in the judgment in Commission v European Food and Others had been established on the basis of a bilateral investment treaty concluded between the Swedish Government and Romania. As follows from settled case-law, the consent of a Member State to the possibility of litigation being brought against it in the context of the arbitration procedure provided for by a bilateral investment treaty, unlike that which would have been given in contractual arbitration proceedings, does not have its origin in a specific agreement reflecting the freely expressed wishes of the parties concerned, but is derived from a treaty concluded between two States in which they have, generally and in advance, agreed to exclude from the jurisdiction of their own courts disputes which may concern the interpretation or application of EU law in favour of arbitration proceedings. Second, in the judgment in Commission v European Food and Others, the Court did not give a ruling on whether the arbitration award in question in that case constituted State aid within the meaning of Article 107(1) TFEU.
Furthermore, the fact that, in the present case, DEI’s action seeking the annulment of the arbitration award was dismissed by the Court of Appeal, Athens, does not mean that that award may, on that ground alone, be attributable to the Greek State. The judicial review carried out by that court does not relate to the lawfulness of the arbitration award, which remains a measure attributable only to the arbitration body which adopted it. In addition, the establishment as such of State aid cannot result from a judicial decision, since such an establishment of State aid entails a decision as to the appropriate course of action which falls outside the scope of a court’s powers and obligations.
In the light of the foregoing, the Court concludes that, in view, inter alia, of the particularities of the dispute between DEI and Mytilinaios and the specific feature of the task entrusted to the arbitration tribunal of the RAE, the Commission was legitimately entitled to find, first, that the only State measure capable of constituting State aid was DEI’s decision to conclude the arbitration agreement with Mytilinaios and, second, that, in order to know whether that decision had conferred an advantage on Mytilinaios, it had been necessary to ascertain whether a private operator, under normal market conditions, would have taken that decision under the same conditions.
In those circumstances, the Court sets aside the judgment of the General Court and refers the three cases back to the General Court for it to adjudicate on the pleas in law on which the Court of Justice has not given a ruling.
(
1
)	Judgment of 22 September 2021, DEI v Commission (T‑639/14 RENV, T‑352/15 and T‑740/17, EU:T:2021:604).
(
2
)	Commission Decision C(2015) 1942 final of 25 March 2015 (Case SA.38101 (2015/NN) (ex 2013/CP) – Greece – Alleged State aid granted to Alouminion SA in the form of electricity tariffs below cost following an arbitration decision) (OJ 2015 C 219, p. 2).
(
3
)	Judgment of 31 May 2017, DEI v Commission (C‑228/16 P, EU:C:2017:409).
(
4
)	Commission Decision C(2017) 5622 final of 14 August 2017 (Case SA.38101 (2015/NN) (ex 2013/CP) – Greece – Alleged State aid granted to Alouminion SA in the form of electricity tariffs below cost following an arbitration decision) (OJ 2017 C 291, p. 2).
(
5
)	Judgment of 25 January 2022, Commission v European Food and Others (C‑638/19 P, EU:C:2022:50).