Keywords

Summary



Keywords

1. State aid – Regulation No 659/1999 – Scope ratione temporis

(Council Regulation No 659/1999)

2. State aid – Respective jurisdiction of the Commission and the national courts – Role of the national courts

(Arts 87 EC and 88(3) EC)

3. State aid – Plans to grant aid – Granting of aid contrary to the prohibition laid down by Article 88(3) EC

(Arts 87(1) EC and 88(3) EC)

4. State aid – Compliance with Community rules – Role of the national courts

Summary

1. In so far as Regulation No 659/1999 laying down detailed rules for the application of Article [88 EC] contains rules of a procedural nature, they apply to all administrative procedures in the matter of State aid pending before the Commission at the time when that regulation entered into force, namely on 16 April 1999.

(see para. 34)

2. Implementation of the system for supervision of State aid is a matter, on the one hand, for the Commission and, on the other, for national courts, each of which fulfil complementary and separate roles.

Whilst assessment of the compatibility of aid measures with the common market falls within the exclusive competence of the Commission, subject to review by the Community Courts, it is for the national courts to ensure that the rights of individuals are safeguarded where the obligation to give prior notification of State aid to the Commission pursuant to Article 88(3) of the Treaty is infringed.

In doing so, the latter must also take the interests of the Community fully into consideration.

With regard to aid, in the form of a partial rebate of a tax, that was illegal because it was granted in breach of the obligation of notification, it would not be compatible with the interest of the Community to order that such a rebate be applied also in favour of other undertakings if such a decision would have the effect of extending the circle of recipients, thus leading to an increase in the effects of that aid instead of their elimination.

The national courts must take care to ensure that whatever remedies they grant are such as in fact to negate the effects of the aid granted in breach of Article 88(3) EC and not merely to extend it to a further class of beneficiaries.

In addition, even if applications for grant of the unlawful aid measure may be likened to applications for partial exemption from that tax, businesses liable to pay an obligatory contribution cannot rely on the argument that the exemption enjoyed by other businesses constitutes State aid in order to avoid payment of that contribution.

Finally, the last sentence of Article 88(3) EC must be interpreted as meaning that it is for the national courts to safeguard the rights of individuals against possible disregard, by the national authorities, of the prohibition on putting aid into effect before the Commission has adopted a decision authorising that aid. In doing so, the national court must nevertheless take the Community interest fully into consideration and must not adopt a measure which would have the sole effect of extending the circle of recipients of the aid.

(see paras 36-38, 44, 48-51, 57-58, operative part)

3. An aid measure within the meaning of Article 87(1) EC which is put into effect in infringement of the obligations arising from Article 88(3) EC is unlawful.

A Commission decision finding aid that was not notified compatible with the common market does not have the effect of regularising ex post facto implementing measures which were invalid because they were taken in disregard of the prohibition laid down by the last sentence of Article 88(3) EC, since otherwise the direct effect of that provision would be impaired and the interests of individuals, which are to be protected by national courts, would be disregarded. Any other interpretation would have the effect of according a favourable outcome to the non-observance of that provision by the Member State concerned and would deprive it of its effectiveness.

Indeed, if, for any particular aid plan, whether compatible with the common market or not, failure to comply with Article 88(3) EC carried no greater risk or penalty than compliance, the incentive for Member States to notify and await a decision on compatibility would be greatly diminished – as would, consequently, the scope of the Commission’s control.

It is of little consequence in that connection that a Commission decision states that its assessment of the aid in question relates to a period prior to its adoption.

It follows that it is of little consequence whether an application is made before or after adoption of the decision declaring the aid compatible with the common market, since that application relates to the unlawful situation resulting from the lack of notification.

(see paras 40-43, 55, 59, operative part)

4. National courts must offer to individuals entitled to rely on disregard of the obligation to notify State aid the certain prospect that all appropriate conclusions will be drawn, in accordance with national law, with regard to both the validity of the acts giving effect to the aid and the recovery of financial support granted in disregard of that provision or possible interim measures.

Depending on what is possible under national law and the remedies available thereunder, the national court may thus, according to the case, be called upon to order recovery of unlawful aid from its recipients, even if that aid has subsequently been declared compatible with the common market by the Commission. In the same way, a national court may be required to rule on an application for compensation for the damage caused by reason of the unlawful nature of the aid.

(see paras 47, 56)