Judgment of the General Court (Ninth Chamber) of 15 November 2018 –

Banco Santander v Commission

(Case T‑227/10)

(State aid — Provisions concerning corporate tax allowing undertakings which are tax resident in Spain to amortise the goodwill resulting from the acquisition of shareholdings in undertakings which are tax resident abroad — Decision declaring the aid to be incompatible with the internal market and ordering its recovery — Concept of State aid — Selectivity — Reference system — Derogation — Difference in treatment — Justification of the difference in treatment — Undertakings benefiting from the measure — Legitimate expectations)

1. Judicial proceedings — Examination of the substance before examination of admissibility — Lawfulness (see paras 23, 24)

2. State aid — Definition — Selective nature of the measure — Measure conferring a tax advantage — Reference framework for determining the existence of an advantage — Material scope — Criteria — Existence of a link between the purpose of the measure in question and that of the reference framework — Comparability of the situations covered by the measure in question and those covered by the reference framework (Art. 107(1) TFEU) (see paras 50-52, 82, 85, 89-93)

3. State aid — Definition — Selective nature of the measure — Measure conferring a tax advantage — Measure of a general nature applicable without discrimination to all economic operators — Measure not applicable to operations comparable to those governing its granting — Measure that can be qualified as selective (Art. 107(1) TFEU) (see para. 69)

4. State aid — Definition — Selective nature of the measure — Measure conferring a tax advantage — Reference framework for determining the existence of an advantage — Material scope — Measure constituting its own reference framework — Conditions — Clearly delineated tax regime with specific objectives — None — Systematic and general nature of the measure (Art. 107(1) TFEU) (see paras 114-119)

5. State aid — Definition — Selective nature of the measure — Derogation from the general tax system — Differentiation between undertakings in a comparable factual and legal situation — Criteria for assessment — Comparison with the objective pursued by the common tax system as a whole (Art. 107(1) TFEU) (see paras 130-136)

6. State aid — Definition — Selective nature of the measure — Derogation from the general tax system — Justification derived from the nature and general scheme of the system — Criteria for assessment — Measure aimed at achieving an objective within the mechanisms inherent in the general tax system — Whether appropriate — Extent of the burden of proof (Art. 107(1) TFEU; Council Regulation No 659/1999) (see paras 153-159, 163, 177, 185, 186, 193, 198)

7. Action for annulment — Purpose — Partial annulment — Condition — Severability of the contested provisions — Objective criterion — Requirement not met — Inadmissibility (Art. 263 TFEU) (see para. 208)

8. State aid — Definition — Assessment in the light of Article 107(1), TFUE — Taking into account previous practice — Not included (Art. 107(1) TFEU) (see paras 211, 236)

9. State aid — Examination by the Commission — Determination of the aid beneficiary — Actual enjoyment — Assessment (Art. 107(1) TFEU) (see paras 225-234)

10. State aid — Definition — Assessment in the light of the objective situation, irrespective of the conduct of the institutions — Taking that conduct into consideration when assessing the obligation to recover incompatible aid — Protection of legitimate expectations (Art. 107(1) TFEU; Council Regulation No 659/1999, Art. 14) (see paras 245-259)

11. State aid — Recovery of unlawful aid — Aid granted in infringement of the rules of procedure laid down in Article 108 TFEU — Legitimate expectations entertained by the recipients — None save in exceptional circumstances — Legitimate expectations arising from specific, unconditional and consistent assurances provided by the Commission — Publication of the decision to open the formal investigation procedure terminating those legitimate expectations (Arts 107(1) TFEU and 108(3) TFEU) (see paras 261-284)

Re:

Application based on Article 263 TFEU and seeking annulment of Article 1(1) of Commission Decision 2011/5/EC of 28 October 2009 on the tax amortisation of financial goodwill for foreign shareholding acquisitions C 45/07 (ex NN 51/07, ex CP 9/07) implemented by Spain (OJ 2011 L 7, p. 48) and, in the alternative, annulment of Article 4 of that decision.

Operative part

The Court:

1. Dismisses the action;