Keywords

Summary



Keywords

1 Plea of illegality - Measures in respect of which a plea of illegality may be raised - General ECSC decision forming the basis of the individual decision contested

(ECSC Treaty, Arts 33, second para., and 36, third para.)

2 ECSC - Steel aid - Prohibited - Whether conditionally prohibited - Prejudicial to competition - No such condition

(ECSC Treaty, Arts 4(c) and 95)

3 ECSC Treaty - Steel aid - Authorisation by the Commission - Aid for closure - Conditions - Discretion of the Commission - Regular production

(ECSC Treaty, Arts 4(c) and 95; Commission Decision No 3855/91/ECSC)

4 ECSC - Steel aid - Authorisation by the Commission - Principle of non-discrimination - Breach - Conditions

(Commission Decision No 3855/91/ECSC, Art. 4(2))

5 ECSC - Steel aid - General aid scheme approved by the Commission - Definition of the criteria for its application - Whether individual aid is covered by the approval - Investigation by the Commission - Assessment in the light of the general scheme and the conditions laid down in the decision approving it

(ECSC Treaty, Arts 5 and 15)

6 Acts of the institutions - Statement of reasons - Obligation - Scope - ECSC decision

(ECSC Treaty, Arts 5 and 15)

Summary

1 Where a Commission decision finding that aid is incompatible with the common market for the purposes of Article 4(c) of the ECSC Treaty produces legal effects of its own, including the definitive refusal of the aid, the recipient undertaking must have a means of redress. This means that it must be able to rely, in support of an action for annulment, on the illegality of any general decision on which the contested decision is based, irrespective of whether or not it has challenged the decision to initiate the procedure for examining the disputed aid.

2 The system set up by Article 4(c) of the ECSC Treaty thus differs from that under Article 92(1) of the EC Treaty (now, after amendment, Article 87(1) EC). The former imposes a general and unconditional prohibition on all aid, which is in substance contrary to the very conditions in which the common market in coal and steel was established. The latter, on the other hand, only prohibits aid where it is such as to distort or threaten to distort competition by favouring certain undertakings or the production of certain goods.

It follows that aid for closure granted by a Member State to a steel undertaking falls within the prohibition in Article 4(c) of the ECSC Treaty, without there being any need to establish that the conditions of competition have in fact been undermined.

3 Under Article 4(c) of the Treaty, all aid for steel from the Member States in any form whatsoever is prohibited. Derogations from that prohibition, such as the Fifth Steel Aid Code, adopted on the basis of Article 95 of the Treaty, must be interpreted strictly.

Having regard to the generally applicable prohibition on aid laid down by Article 4(c) of the ECSC Treaty and to the exceptional and limited nature of the derogations allowed, the Commission was entitled to consider (in the Fifth Steel Aid Code authorising aid in favour of undertakings which definitively cease their production of steel), in exercising its discretion and without manifestly misconstruing the law or misusing its powers, that aid for closure must have significant effects on the market and therefore should only be granted to undertakings which, whilst less competitive, have none the less produced on a regular basis within the meaning of Article 4(2) of the Fifth Code. Moreover, the Commission may, in a later decision, lay down the conditions for implementing that provision.

4 For the Commission to be found in breach of the principle of non-discrimination, it must be shown to have treated like cases differently, thereby placing some traders at a disadvantage by comparison with others, without such differentiation being justified by the existence of substantial objective differences.

In the context of steel aid, it is therefore necessary to consider whether or not the difference in treatment as between undertakings is based on the existence of objective and substantial differences having regard to the aims which the Commission may lawfully pursue as part of its industrial policy in the European steel industry.

5 Whilst the second indent of Article 4(2) of the Fifth Steel Aid Code lays down the requirement of regular production, it does not define that requirement. It follows that the Commission, in approving a general aid scheme notified by a Member State, is of necessity bound to define in abstract terms the criteria for the application of that requirement so as to enable it then to make a uniform and predictable assessment of individual requests for aid notified under Article 6(6) of the Fifth Code, in compliance with the principles of legal certainty and protection of legitimate expectations.

Once the criteria have been specified and the general scheme has been approved, the Commission must, when aid granted on the basis of the previously authorised scheme is notified, confine itself to checking that the aid is covered by the general scheme and satisfies the conditions laid down in the decision approving it. Were it not to take that approach, the Commission could, whenever it examined any individual cases notified, reconsider its decision approving the general aid scheme. This would jeopardise the principles of legal certainty and the protection of legitimate expectations from the point of view of both the Member States and traders since individual aid in conformity with the decision approving the general aid scheme could thus at any time be called in question by the Commission in breach of those principles.

6 The requirement of a statement of reasons laid down by Articles 5 and 15 of the ECSC Treaty must be assessed in the light of the circumstances of the case, in particular the content of the measure, the nature of the reasons relied upon and the interest which the addressees or other persons concerned by the measure, for the purposes of the second paragraph of Article 33 of the Treaty, may have in obtaining an explanation. In the case of a measure which is intended to be of general application, the requirements laid down in Articles 5 and 15 oblige the Commission to mention, when stating the reasons on which its decision is based, the situation as a whole which led to the adoption of the decision and the general objectives which it seeks to attain.