Opinion of Mr Advocate General Tesauro delivered on 10 December 1996. - Textilwerke Deggendorf GmbH (TWD) v Commission of the European Communities and Federal Republic of Germany. - State aid - Commission decisions suspending payment of certain aids until previous unlawful aid has been repaid. - Case C-355/95 P.



European Court reports 1997 Page I-02549



Opinion of the Advocate-General

1 In the present appeal, TWD Textilwerke Deggendorf GmbH (hereinafter `TWD' or `the appellant'), a company incorporated under German law operating in the synthetic fibre sector, has applied to the Court of Justice to set aside the judgment of 13 September 1995 (1) (`the judgment') in which the Court of First Instance dismissed two applications from the appellant for annulment of two Commission decisions adopted under Article 93(2) of the Treaty.

The case relates, in particular, to Commission Decisions 91/391/EEC of 26 March 1991 (2) (the `TWD II decision') and 92/330/EEC of 18 December 1991 (3) (the `TWD III decision'), both concerning aid granted to the appellant by the Federal Republic of Germany. In those decisions the Commission ruled that the said aid was compatible with the common market but nevertheless suspended its payment until the appellant had repaid other aid unlawfully granted in the past, which had been declared incompatible with the common market by Decision 86/509/EEC of 21 May 1986 (4) (the `TWD I decision').

The facts of the case and the contested decisions

2 During the period from 1981 to 1983 the appellant received a subsidy of DM 6.12 million from the Federal German Government and a soft loan of DM 11 million from the Land of Bavaria (the `TWD I aid'), which were not notified to the Commission.

Following belated notification, which was received only in 1985 after repeated reminders from the Commission, the latter adopted the TWD I decision, in which it found that the aid in question was unlawful and incompatible with the common market and ordered it to be recovered. The TWD I decision became final when the deadline for lodging an appeal expired.

3 In October 1989 the German authorities notified the Commission of a plan to grant new aid to the appellant, comprising a subsidy of DM 4.52 million and two soft loans of DM 6 and 14 million for the production of stockings and elasticated yarns (the `TWD II aid'). The Commission initiated the Article 93(2) procedure, which culminated in the adoption of the TWD II decision; the operative part of that decision provides inter alia as follows:

`Article 1

The aid [...] is compatible with the common market within the meaning of Article 92 of the EEC Treaty.

Article 2

The German authorities are hereby required to suspend payment to Deggendorf of the aid referred to in Article 1 of this decision until such time as they have recovered the incompatible aids referred to in Decision 86/509/EEC.'

4 In the meantime, in February 1991, the German authorities notified the Commission of further planned aid to the appellant in the form of soft loans to assist the relaunching and modernization of a newly acquired company specializing in the manufacture of textile curtains (the `TWD III aid'). Once again the Commission initiated the procedure under Article 93(2) of the Treaty, which culminated in the adoption of the TWD III decision mentioned above.

The operative part of that decision, which is couched in similar terms to that of the TWD II decision, declares the TWD III aid to be compatible with the common market (Article 1) but makes payment conditional on recovery of the TWD I aid by the German authorities (Article 2).

5 The reasons given for the TWD II and TWD III decisions are essentially the same. In both decisions the Commission first found that the products for whose manufacture the aid was intended (stockings and elasticated yarns in the first instance and textile curtains in the second) constituted an additional outlet for the production of yarns, thus easing oversupply in the sector.

Taking account of the regional purpose of the aid in question as well as of its potential positive effects on employment, the Commission therefore concluded in both cases that it was eligible for exemption in accordance with Article 92(3)(c) of the Treaty and declared it to be compatible with the common market.

6 Pointing out, however, that at the dates on which the disputed decisions were adopted TWD had still not repaid the TWD I aid, as required by the TWD I decision, and emphasizing that the cumulative effect of the TWD I aid and the new aid would give the recipient undertaking an excessive and undue competitive advantage and unjustly enrich it, the Commission therefore considered it appropriate to suspend payment of the TWD II and TWD III aid until the TWD I aid had been repaid.

In that regard, the Commission stated that it was `obliged to draw this conclusion' owing to a situation caused by the negligent behaviour of the German Government and TWD, which had both infringed the mandatory rules laid down in Article 93(3) of the Treaty; in addition, it pointed out that it did not have `any other means of coercion at its disposal to accelerate or enforce implementation of its [TWD I] decision'. (5)

The judgment of the Court of First Instance

7 In its judgment on TWD's applications for annulment of the TWD I and TWD II decisions, which is the subject of the present appeal, the Court of First Instance examined the validity of those decisions from various aspects, in accordance with the allegations made by the appellant.

In particular, the Court dealt first with the pleas alleging the Commission's lack of competence to make the granting of aid that is compatible with the common market conditional on the repayment of previous aid and infringement of the principles governing the division of powers between the Community and the Member States, secondly with the pleas alleging that no competitive advantage had been gained from the TWD I aid, thirdly with the pleas alleging infringement of the principle of proportionality, and finally with the pleas alleging that the TWD I aid was lawful.

8 With regard to the first aspect, which is the most important for the purposes of these proceedings, the Court of First Instance rejected the appellant's arguments on the basis of an interpretation of the operative parts of the contested decisions in the light of the reasons set out therein. In that regard, the Court of First Instance first of all stated that:

`The Court considers that [...] the TWD II decision and the TWD III decision, each read as a whole, must be interpreted as meaning that the Commission came to the conclusion that the new TWD II and TWD III aids were incompatible with the common market as long as the old TWD I aid had not been repaid. In the grounds of the contested decisions, the Commission considered that the cumulative effect of the old TWD I aid and the new TWD II and TWD III aids would be to alter trading conditions in a way contrary to the general interest. The meaning of the decisions in question is therefore that the new TWD II and TWD III aids, considered in themselves, may be compatible with the common market but that they may not be authorized under Article 92(3)(c) of the Treaty unless the cumulative effect of the old TWD I aid and the new TWD II and TWD III aids is eliminated.

It follows that the operative parts of the contested decisions cannot be interpreted [...] as an unconditional finding of compatibility with the common market (Article 1), to which is added an unlawful suspensory condition (Article 2). On the contrary, the Court considers that it is clear from the actual reading of the decisions in question that the Commission would not have found the new TWD II or TWD III aids to be compatible with the common market, as it did in Article 1 of the operative parts in question, without the condition laid down in Article 2. The purpose of Article 2 of the operative parts in question is in fact to enable the declaration of compatibility in Article 1 to be made.' (6)

9 With regard more particularly to the plea relating to the Commission's powers to impose conditions on the granting of aid expressly stated to be compatible with the common market, powers that are vigorously contested by the appellant, the Court of First Instance first stated that the role assigned to the Commission in the matter by the Treaty necessarily implies that, where it considers it appropriate, it can require aid to be `altered' or make the admissibility of support measures subject to conditions aimed at ensuring balanced trade flows and hence at safeguarding the general interest.

According to the Court of First Instance, this assertion is confirmed by the Court of Justice, which has held that `when the Commission considers the compatibility of a State aid with the common market, it must take all the relevant factors into account, including, where relevant, the circumstances already considered in a prior decision and the obligations which that previous decision may have imposed on a Member State'. (7)

10 On the specific question of the Commission's powers to use a procedure having no legal basis in order to achieve objectives for which, in the view of the appellant, the Treaty instead makes specific provision, as in Article 169, the Court of First Instance went on to state that the operative parts of the contested decisions, far from serving the same purposes as an action for infringement against the German Government, simply deal with `conditions upon which new aid, which TWD was in no way obliged to request, could be granted to it'.

In that context, the Court continued, `the aim of Article 2 of the operative parts in question is not to find that the TWD I decision has been infringed but to prevent disbursement of new aid distorting competition in a way contrary to the general interest'. (8)

Finally, on the basis of established case-law, the Court rejected the appellant's contention that the Commission had committed a misuse of power (9) and concluded that `the Commission was competent to adopt Article 2 of the operative parts of the decisions in question'. (10)

11 With regard to the alleged breach of the principles governing the division of powers between the Community and the Member States, which the appellant claims the Commission committed by failing to take account either of the proceedings pending before the national court on the same subject-matter or of the appellant's legitimate expectation, protected by the applicable national law, that the aid was lawful, the Court of First Instance found first of all that `the fact that domestic proceedings are in progress cannot affect the Commission's power to adopt all measures necessary to ensure that competition in the Community is not distorted'. (11)

As regards the protection of the appellant's legitimate expectation, the Court of First Instance reiterated the established case-law of the Court of Justice, according to which the recipient of unlawful aid (such as the TWD I aid) obtained in breach of the procedures laid down in the Treaty may rely upon such protection only in exceptional circumstances; it concluded that such circumstances do not appear to exist in the present case, as demonstrated by the fact that the court hearing the national proceedings has still not established their existence, after eight years of proceedings, let alone made a reference to the Court of Justice for a preliminary ruling in the matter. (12)

12 Finally, the Court of First Instance also dismissed the appellant's other pleas as unfounded; in particular, it found that the Commission's alleged error of assessment with regard to the competitive advantages deriving from the cumulation of the aid in question had not been sufficiently demonstrated, (13) that the Commission's alleged infringement of the principle of proportionality was based on a premiss that was also unproven, namely that the total of the TWD II and TWD III aid exceeded the value of the TWD I aid, (14) and finally that the question of the lawfulness of the TWD I aid could not be reopened, as the period for bringing proceedings against the TWD I decision had long since expired and the decision had therefore become final. (15)

Grounds of appeal

13 As stated earlier, in the present proceedings the appellant has applied to the Court of Justice to set aside the judgment of the Court of First Instance and to declare Article 2 of the contested decisions void; the appeal is based on six different grounds.

In the first ground of appeal, the appellant claims that the Court of First Instance infringed Community law by interpreting the TWD II and TWD III decisions without taking account of the wording of their operative parts. In the second, third, fourth, fifth and sixth grounds the appellant essentially repeats the arguments used in the proceedings at first instance, maintaining that the Commission was not competent to adopt Article 2 of the two decisions, that it infringed the provisions governing the division of powers between the Community and the Member States, that it committed a misuse of power, that it wrongly found that the TWD II and TWD III aids together with the TWD I aid gave TWD a competitive advantage, and finally that it infringed the principle of proportionality.

The first and second grounds of appeal

14 As the first and second grounds of appeal are closely related, they must in my view be dealt with together and constitute the central issue of these proceedings. According to the appellant, the Court of First Instance erred in law by upholding the validity of two decisions whereby the Commission imposed obligations which, still according to the appellant, exceed its powers and lack an appropriate legal basis.

In other words, the question of principle on which this Court is asked to rule today may be summarized as follows: can the Commission, by means of a procedure provided for in Article 92(3) of the Treaty, adopt a decision in which it states that a particular aid is compatible with the common market and at the same time prohibit its disbursement until the recipient undertaking has repaid another aid, previously granted and declared incompatible by the Commission in another decision?

Let me say at once that, contrary to the view taken by the Court of First Instance and for reasons which I shall explain, I am strongly inclined towards a negative answer to that question.

15 First, the Court's reading of the contested decisions in the judgment at issue stands, in my opinion, in sharp contradiction with the wording of their operative parts. As set out at length in point 8 above, the Court holds that the decisions are to be interpreted as meaning that the Commission considered the TWD II and TWD III aids incompatible with the common market until such time as the TWD I aid has been repaid, with the result that the compatibility of the former is subject to the prior repayment of the latter.

There is an insurmountable obstacle to that interpretation, however, in Article 1 of the contested decisions and in various parts of the preamble thereto, which expressly states that `the aid [...] is compatible with the common market'; (16) that declaration of compatibility, it should be noted, is based on assessments of the aid's sectoral impact, regional objectives and potential positive effects on employment.

16 As I have already said, it is true that the statements of reasons for the decisions also contain references to the financial situation of the recipient undertaking, and in particular to the undue competitive advantages and unjust enrichment it could enjoy if it were granted other aid in addition to that unlawfully received and not repaid; however, the Commission does not draw the conclusions that would seem most logical, namely that the TWD II and TWD III aids are incompatible with the common market in so far as they strengthen the competitive position of an undertaking which has, moreover, already benefited from unlawful aid that has not been repaid; instead, it expressly takes the opposite view, in other words that the aid in question is compatible with the common market, for all the reasons stated, only then to make disbursement conditional on repayment of the TWD I aid.

In other words, the reasoning of the Court of First Instance could be endorsed only if the decisions clearly showed that the Commission intended to make the compatibility of the new aid conditional on repayment of the preceding aid, that is to say if it was evident from the decisions that, following a thorough investigation of the financial situation of the undertaking at the time of approving the aid, the Commission concluded that, notwithstanding the potential positive effects of the aid on the sector in question, on the development of the region concerned and on employment, the new aid was incompatible with the common market because it unlawfully strengthened the position of the undertaking, and that such aid could be compatible only on condition that the preceding aid be repaid. Needless to say, the statements of reasons for the decisions in question should take due account of such a balancing of the interests involved. (17)

As we have seen, however, that is not the case. On the contrary, in the contested decisions the TWD II and TWD III aids are expressly stated to be compatible with the common market, yet disbursement is suspended pending repayment of other aid.

17 That being so, I do not consider that the Commission can be permitted to make payment of aid that it has itself expressly stated to be compatible with the common market subject to additional conditions, which moreover relate to matters that are (legally at any rate) distinct. By contrast with its treatment of aid incompatible with the common market, the Treaty does not contain provisions giving the Commission power to suspend the payment of compatible aid. (18)

Nor can such powers be deduced by way of interpretation; indeed, not even the practical effect of the aid provisions (in particular Articles 92 and 93 of the Treaty) can be relied upon for this purpose. In my view, to prohibit (or, as in this case, to suspend) payment of aid that is compatible with the Treaty is not permissible in any event, in that the justification for such prohibition (or suspension), namely that the granting of the aid entails the risk of influencing trade flows and distorting competition, is missing. In imposing a requirement of the kind in question, therefore, the Commission is clearly going beyond the limits of the task assigned to it by the Treaty.

18 The judgment of the Court of Justice cited by the Commission and referred to by the Court of First Instance to justify the Commission's right to take account of previous circumstances when adopting decisions regarding aid, (19) in reality only corroborates these considerations. It states that the Commission must indeed also take into account the obligations which a previous decision may have imposed on a Member State, but precisely for the purpose of assessing the compatibility of an aid with the common market, (20) and not, as the Commission and the Court of First Instance appear to infer, for the purpose of suspending the payment of compatible aid.

In other words, pursuant to the Treaty but also on the basis of the case-law of the Court of Justice, the Commission has two possible alternatives: either to state, taking account of all the relevant factors, including the financial situation of the undertaking and previous circumstances, that the aid is incompatible with the common market, in which case it can and indeed must order payment to be suspended, or to state, as a result of such an investigation, that the aid is compatible with the common market, but in that case it is obviously not permitted to oppose its disbursement.

19 That statement of principle is also borne out, in my opinion, by a more careful reading of the reasons on which the contested decisions are based. On the one hand, as we have seen, the Commission declares the aid in question to be compatible with the common market on the basis of assessments of its nature and potential effect on the economy of the sector in question. On the other, it then suspends payment of the aid, citing the harm caused by the cumulative effect of such aid with the previous aid and the unjust enrichment from which the recipient undertaking could benefit in that case. In that regard, however, the Commission does not conceal the fact that it is pursuing a precise objective, namely in the absence of other `means of coercion' that of enforcing the obligations incumbent on the German authorities and on TWD as a result of the TWD I decision.

It therefore seems rather obvious to me that the Commission really intended to seize the opportunity offered by the procedures for the TWD II and TWD III aid to give effect to and enforce the obligation imposed on the German authorities (and indirectly on TWD) by the TWD I decision to recover the TWD I aid.

20 I acknowledge that such an objective may in itself be more than reasonable, given the well-known difficulties which the Commission often encounters in practice when attempting to recover aid that is unlawful and/or declared to be incompatible with the common market.

The fact remains, however, that such an objective should be pursued by appropriate means, whereas in Article 2 of the TWD II and TWD III decisions the Commission requires suspension of payment of aid which in Article 1 (and in the statements of reasons) of the same decisions it defines as compatible with the common market, without, as I have said, authorization from any provision of the Treaty and hence clearly acting in excess of its powers. As I have already pointed out, a different conclusion could be reached only if the Commission had found that the new aid was incompatible with the common market owing to its cumulative effects with the previous aid, and had given due reasons for that finding; only in that case would it have been (also) legally justified to suspend payment of the new aid.

21 But that is not all. I consider in any case unfounded the Commission's assertion that it was `obliged' to order payment of the aid in question to be suspended as it had no other means of inducing the German authorities and TWD to comply with the obligations imposed by the TWD I decision.

Under the Treaty the Commission has a specific remedy for instances of failure to fulfil obligations imposed by a decision taken under Article 93(2). I am alluding to the power it derives from the second subparagraph of Article 93(2) of the Treaty to refer a matter directly to the Court of Justice for a ruling on an infringement by the State in question, a simpler and more rapid procedure than that provided for under Article 169 of the Treaty. It is then clear that if the State does not comply with the Court's judgment that it has failed to fulfil its obligations, the Commission can resort to the procedure laid down in Article 171 of the Treaty and ask the Court to impose a fine on the State in question.

22 On the basis of the foregoing considerations, therefore, it seems to me that the following conclusion is unavoidable: to allow the appeal and consequently to set aside the contested judgment and, in accordance with the application, to annul Article 2 of the TWD II and TWD III decisions on the grounds of the Commission's lack of competence and excess of powers.

I am aware that this solution may cause some misgivings, in so far as the annulment of only Article 2 of the contested decisions in practice has the effect of permitting the disbursement of aid to an undertaking guilty of non-compliance with an obligation imposed upon it (albeit indirectly) by the Commission to repay other aid. On the one hand, however, the documents in the case show that proceedings are in train before the national court, as a result of which there is reason to hope that sooner or later that obligation will be complied with. On the other hand, and in any event, the actions for annulment brought by the appellant first before the Court of First Instance and then before the Court of Justice relate expressly and exclusively to the provisions in question, so that this Court may not, without acting ultra petita, question the validity of other provisions that are not contested.

23 Only one course of action is available to the Court of Justice to overcome this problem: to annul the contested decisions in their entirety for failure to state reasons.

In other words, the Court could decide, in accordance with established case-law, to assess of its own motion the reasons on which the decisions in question were based; (21) and it could reach the conclusion that, in the present case, the requirement to state reasons had not been complied with, for example because, as mentioned, the express declaration of compatibility of the new aid with the common market is not sufficiently proven (or is at any rate contradictory), given the distortion of competition which, according to the Commission itself, arises from the cumulation of the new aid with the previous aid. In that way, the Court would be entitled to annul the decisions in their entirety without this constituting a ruling ultra petita. (22)

24 I cannot subscribe fully to such a solution, however, even though it would enable the Commission to adopt new decisions in the same case, drawing on the considerations of the Court of First Instance and the Court of Justice.

Although this solution would be legally sound, at least on the basis of a flexible interpretation of the aforesaid case-law of the Court of Justice, it seems to me to ignore the operative procedural principle that the wishes of the applicant with regard to the claim should take precedence. In the present case, the annulment of the decisions in their entirety, when the appellant has (for obvious reasons) expressly sought their annulment only in part, would in the end completely distort the essential outcome of the application which, even if upheld, would entail consequences for the appellant that were ultimately more disadvantageous than if it were dismissed. (23)

25 Those considerations also strengthen my inclination towards the first of the solutions outlined, which affects only the validity of the obligation to suspend payment of the new aid; in taking that view, I am fully aware that the (only) merit of such a solution is ultimately that it will provide a useful indication for the future.

In conclusion, I consider that Article 2 of the contested decisions is vitiated by the fact that the Commission exceeded its powers and lacked competence and that the Court of First Instance erred in law in upholding their validity. I therefore consider that the appellant's first two grounds should be accepted and the contested judgment set aside; I also propose that the Court of Justice should rule on the substance of the case and annul Article 2 of the TWD II and TWD III decisions.

In the alternative, however, should this Court favour a solution different from that which I have outlined, I shall review, albeit briefly, the other grounds relied upon by the appellant.

The fourth ground of appeal

26 The fourth ground, in particular, deserves brief consideration; as mentioned, in this ground the appellant claims that the Commission misused its powers in adopting the contested decisions.

In the light of the conclusions I have arrived at regarding the first two grounds of appeal, I consider in principle that the fourth ground can be considered to have been subsumed within the first two.

27 Nevertheless, I would note for the sake of completeness and without examining this point in depth, that the possibility cannot be ruled out that the decisions in question may in fact also be vitiated by misuse of powers, consisting more precisely in a misuse of procedure.

On the basis of what I consider to be the correct interpretation of the decisions, (24) it is fairly clear that the procedure laid down under Article 93(2) of the Treaty for determining whether an aid is compatible or incompatible with the common market was in fact used by the Commission for other purposes, namely to induce the State to which the decisions are addressed to comply with obligations imposed by another prior decision in the matter. It therefore appears to me that, in so doing, the Commission committed a misuse of procedure, of the kind envisaged in the case-law of the Court of Justice cited by the Court of First Instance, (25) and that this constitutes a further ground, if one were needed, for annulling Article 2 of the decisions.

The third, fifth and sixth grounds of appeal

28 I consider, by contrast, that the remaining grounds of appeal should all be rejected, for various reasons.

In my view, the third ground, which relates to the alleged infringement of the principles governing the division of powers between the Community and the Member States, is unfounded. As this argument is essentially identical to that already pleaded before the Court of First Instance and rejected by the latter, I need only recall the reasons set out in the contested judgment on this point, which appear to be correct, adequate and supported by appropriate references to consistent case-law of the Court of Justice. (26)

29 Instead the fifth and sixth grounds of appeal, which relate respectively to an allegedly mistaken assessment of the competitive advantages deriving from the cumulation of the aids in question and to the alleged infringement of the principle of proportionality (owing to the greater overall amount of the TWD II and TWD III aids by comparison with the TWD I aid), are inadmissible.

These arguments seek to cast doubt on findings of fact already made by the Court of First Instance and which cannot therefore be reviewed on appeal.

Conclusion

30 In the light of the foregoing considerations, I therefore propose that the Court of Justice should:

- allow the appeal and set aside the judgment of the Court of First Instance of 13 September 1995 in Joined Cases T-244/93 and T-486/93 TWD v Commission;

- annul Article 2 of Commission Decision 91/391/EEC of 26 March 1991 and Article 2 of Commission Decision 92/330/EEC of 18 December 1991;

- order the Commission to pay the costs.

(1) - In Joined Cases T-244/93 and T-486/93 TWD v Commission [1995] ECR II-2265.

(2) - OJ 1991 L 215, p. 16.

(3) - OJ 1992 L 183, p. 36.

(4) - OJ 1986 L 300, p. 34.

(5) - The quotation is taken from the TWD III decision, but the TWD II decision is essentially the same on this point.

(6) - The TWD judgment, cited above, paragraphs 51 and 52.

(7) - The TWD judgment, cited above, paragraphs 53 to 56, which make reference to the principles laid down in the judgment in Case C-261/89 Italy v Commission [1991] ECR I-4437, paragraph 20.

(8) - The TWD judgment, cited above, paragraphs 57 to 59.

(9) - The TWD judgment, cited above, paragraphs 61 and 62, in which the Court of First Instance recalls the established principle that `a decision is vitiated by misuse of power only if it appears, on the basis of objective, relevant and consistent factors, to have been taken with the purpose of achieving ends other than those stated (see, for example, the judgment of the Court of Justice in Case C-331/88 Fedesa and Others [1990] ECR I-4023 and the judgment of this Court in Case T-106/92 Frederiksen v Parliament [1995] ECR II-99)'; from this it deduces that, since in the present case the Commission did not pursue objectives other than those stated, the decisions are not vitiated by misuse of power.

(10) - The TWD judgment, cited above, paragraph 63.

(11) - The TWD judgment, cited above, paragraphs 66 and 68, in which it is also stated that the contested decisions do not prevent the applicant from pursuing the proceedings in progress before the national court.

(12) - The TWD judgment, cited above, paragraphs 69 to 71, in which the Court of First Instance refers to the judgment of the Court of Justice in Case C-5/89 Commission v Germany [1990] ECR I-3437, paragraphs 12 to 16.

(13) - The TWD judgment, cited above, paragraphs 82 to 85.

(14) - The TWD judgment, cited above, paragraphs 94 to 97.

(15) - The TWD judgment, cited above, paragraphs 104 and 105, in which the Court of First Instance refers to the judgment in Case C-188/92 TWD Textilwerke Deggendorf v Germany [1994] ECR I-833.

(16) - See, for example, the TWD II decision, Part IV, final paragraph, and Part V, tenth and thirteenth paragraphs, and the TWD III decision, Part III, final paragraph, and Part IV, tenth and sixteenth paragraphs.

(17) - A simple application of the Philip Morris judgment (judgment in Case 730/79 Philip Morris v Commission [1980] ECR 2671, paragraph 11, in which the Court stated that `when State financial aid strengthens the position of an undertaking compared with other undertakings competing in intra-Community trade the latter must be regarded as affected by that aid') would not, in my view, be sufficient justification for declaring that aid which the Commission itself had found and expressly recognized to have potential positive effects on the sector and region concerned and on employment were incompatible.

(18) - See also in this connection the judgment in Case C-294/90 British Aerospace and Rover v Commission [1992] ECR I-493, paragraph 14, in which the Court, albeit in different circumstances, criticized the Commission's use of aid procedures not regulated by the Treaty.

(19) - Judgment in Case C-261/89, cited above in footnote 7.

(20) - Judgment in Case C-261/89, cited above, paragraph 20, from which the passage quoted in point 9 of this Opinion is taken.

(21) - See the judgment in Case 18/57 Nold v High Authority [1959] ECR 41, part D, and, more recently, the judgment in Case 185/85 Usinor [1986] ECR 2079, paragraph 19.

(22) - See, a contrario, the judgment in Case 37/71 Jamet v Commission [1972] ECR 483, paragraphs 11 and 12, in which the Court, ruling on the admissibility of an application for partial annulment, stated that `if the Court were to annul the entire measure this would constitute a ruling ultra petita since the application against the contested decision does not concern public policy' (emphasis added).

(23) - Annulment of the contested decisions in their entirety would also extend to the express declaration of compatibility of the aid in question with the common market.

(24) - See, in particular, point 19 of this Opinion.

(25) - The Fedesa judgment, cited in footnote 9 above, which states that `a decision may amount to a misuse of powers only if it appears [...] to have been taken with the exclusive purpose, or at any rate the main purpose, of achieving an end other than that stated or evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case' (paragraph 24). It should be noted that the Court of First Instance, in citing this case-law in order to reject the appellant's argument in this regard, completely omits to report one of the two possible misuses of powers expressly contemplated by the Court of Justice, namely the misuse of procedure (`or evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case'): see the TWD judgment, cited above, paragraph 61.

(26) - See point 11 of this Opinion.