Keywords

Summary



Keywords

1. Actions for annulment – Interest in bringing proceedings

(Art. 230, fourth para., EC)

2. Acts of the institutions – Statement of reasons – Obligation – Scope

(Art. 253 EC)

3. Actions for annulment – Judgment annulling a measure – Scope – Adoption of a new measure on the basis of earlier valid preparatory measures – Lawfulness

(Art. 88(2) EC; Council Regulation No 659/1999, Art. 7(2) and (3))

4. Actions for annulment – Judgment annulling a measure – Effects – Adoption of measures of compliance – Reasonable time

(Art. 233 EC)

5. State aid – Administrative procedure – Right of the parties concerned to submit their comments

(Art. 88(2) EC; Council Regulation No 659/1999)

6. State aid – Definition – Private investor test

(Art. 87(1) EC)

7. Actions for annulment – Pleas in law – Manifest error of assessment – Error having no decisive effect on the outcome – Invalid plea in law

8. Actions for annulment – Pleas in law – Pleas that may be raised against a Commission decision on State aid

(Art. 230, fourth para., EC)

9. State aid – Not allowed – Exceptions – Discretion of the Commission – Criteria for assessment – Effect of the guidelines adopted by the Commission

(Art. 87(3) EC; Commission Notice 94/C 350/07)

10. State aid – Not allowed – Exceptions – Aid which may be considered compatible with the common market – Examination of restructuring measures planned by the undertaking benefiting from the aid

(Art. 87(3) EC)

Summary

1. For an applicant to be entitled to pursue an action seeking the annulment of a decision, he must retain a personal interest in the annulment of the decision. That applies in the case of an undertaking which, even though it has received all the State aid for restructuring allocated to it, seeks annulment of the Commission decision which established that the aid was compatible with the common market and that decision formed the legal basis of a subsequent Commission decision authorising payment of the final instalment of that aid. If the Court of First Instance were to annul the contested decision on the ground that it classified the measure in question as State aid, such an annulment would have legal consequences for the subsequent decision, which would have no legal basis.

(see paras 37, 40-42)

2. The answer to the question whether a Community act fulfils the obligation laid down in Article 253 EC to state the reasons on which it is based depends on the nature of the act in question and on the context in which it was adopted. Thus, where an applicant was closely involved in the process by which the contested decision came about and is therefore aware of the reasons for which the administration considered that its request should not be granted, the scope of the obligation to state reasons will be defined by the context thus created by the party’s involvement in that process. In such circumstances, the requirements of the applicable case-law are considerably relaxed.

Where the contested decision was adopted after an earlier decision which was annulled in a judgment setting out the facts, the administrative procedure and the content of the annulled decision, account must be taken of the fact that the contested decision was adopted in a context which was well known to the applicant.

(see paras 57, 69)

3. The annulment of a Community act concluding an administrative proceeding which comprises several stages does not necessarily entail the annulment of the entire procedure prior to the adoption of the contested act, regardless of the grounds, procedural or substantive, of the judgment pronouncing the annulment.

Where, in spite of the fact that investigation measures have been taken allowing an exhaustive analysis to be made of the compatibility of State aid, the analysis carried out by the Commission is incomplete, thus making the decision which concluded that the aid was compatible unlawful, the procedure for replacing that decision can be resumed at that point by means of a fresh analysis of the investigation measures. Moreover, it is not necessary for the entire procedure prior to the adoption of a measure adopted in replacement of another to be repeated only where that measure was annulled on the ground of procedural defects.

Furthermore, there is no obligation to publish a new notice in the Official Journal and to reopen the formal investigation procedure in order to consult once more the financial investors and experts, since there is no provision in Regulation No 659/1999 on the application of Article 88 EC which requires a procedure to be reopened where adjustments are made to an initial restructuring plan in the course of the formal investigation, even though such adjustments are envisaged in Article 7(2) and (3) of that regulation.

(see paras 100-101, 103, 142-143)

4. The obligation upon a Community institution to give effect to an annulment judgment delivered by the Community judicature derives from Article 233 EC. Compliance calls for the adoption of a number of administrative measures and is not normally possible immediately. The institution concerned is allowed a reasonable period within which to comply with a judgment annulling one of its decisions. The question whether or not the period is reasonable depends on the nature of the measures to be taken and the attendant circumstances.

Where a period of seven months elapses between the delivery of the judgment annulling a Commission decision classifying a notified plan as State aid that is compatible with the common market, subject to certain conditions, and the adoption of a new Commission decision, that period cannot be regarded as excessive, since it is necessary to give practical effect to the annulment judgment, in particular by making, on the basis of the available information, a fresh application of the private investor operating on market principles test – which requires in-depth financial analysis.

The undertaking receiving the aid cannot claim that the principle of the protection of legitimate expectations was infringed on the sole basis that the Commission did not appeal the annulment judgment, since that judgment does not exclude the possibility that the annulled decision may be remedied and the period available to the Commission to give practical effect to that judgment is longer than the two-month period within which it must lodge its appeal against the judgment.

(see paras 155-156, 162)

5. There is no provision in Regulation No 659/1999 on the application of Article 88 EC requiring the Commission to make available again to the third parties concerned, who were ensured of the right to submit their comments with the publication of a notice in the Official Journal of its decision to initiate the formal investigation procedure and were closely involved in the investigation of the disputed aid which led to an initial decision which was annulled and replaced by a second decision, the same opportunity in the investigation which led to the second decision, since the Commission was required to base its new analysis solely on information which was available to it when it took its initial decision – information in respect of which the third parties had already defined their position, so that it was unnecessary to consult them afresh.

(see para. 174)

6. The Commission’s assessment of whether an investment satisfies the private investor test is a complex economic matter. In adopting a measure entailing such a complex economic assessment, the Commission enjoys a wide discretion and any judicial review of such a measure, even though it is generally thorough as far as the question of whether a measure falls within the scope of Article 87(1) EC is concerned, is confined to establishing that the rules of procedure and the rules relating to the duty to give reasons have been complied with, to verifying the accuracy of the facts relied on in making the contested decision and that there has been no manifest error in the assessment of those facts or misuse of powers. In particular, it is not for the Court to substitute its economic assessment for that made by the institution which adopted the decision.

(see para. 185)

7. In an action for annulment, a plea based on a manifest error of assessment is inoperative and accordingly would not be sufficient to warrant annulment of the contested decision if, in the particular circumstances of the case, it could not have had a decisive effect on the outcome.

(see para. 307)

8. In annulment proceedings brought by an undertaking in receipt of State aid against a decision that the aid is compatible with the common market, subject to compliance with certain conditions, a plea directed against the conditions to which the compatibility of the aid in question with the common market was made subject cannot be regarded as inadmissible on the ground that those conditions are not attributable to the Commission, which has exclusive jurisdiction to find that aid is incompatible with the common market.

It cannot be ruled out that an undertaking receiving aid may be able to challenge, before the Community judicature, the conditions to which a decision adversely affecting it is made subject, where those conditions have been the subject of negotiations between the Commission and the national authorities and even of undertakings given by those authorities.

(see paras 380-381, 383)

9. The Commission may lay down for itself guiding principles for the exercise of its discretionary powers by way of documents such as guidelines, provided that they contain directions on the approach to be followed by that institution and do not depart from the Treaty rules. The aviation notice requires restructuring aid to be part of a programme aiming to restore the health of the airline so that it can, within a reasonable period, be expected to operate viably. In accordance with paragraph 38(1) and (2) and paragraph 41 of that notice, the Commission can authorise restructuring aid only in exceptional cases and under very stringent conditions. It follows that, in a decision adopted on the basis of Article 87(3)(c) EC, the Commission can impose any condition it deems necessary to ensure that the undertaking receiving the aid will be viable following its restructuring. On the other hand, none of those provisions requires all the conditions imposed in that context to be necessary for ensuring that the undertaking is restored to viability. On the contrary, it is apparent from that notice that the Commission must also endeavour to limit, as far as reasonably practicable, distortions of competition and to ensure that the government refrains from interfering in the management of the company for reasons other than those stemming from its ownership rights and that the aid is used exclusively for the purposes of the restructuring programme and is not disproportionate to its needs.

(see paras 405-408)

10. As far as State aid is concerned, while there can be no grounds for denying that the Commission is entitled to compare the restructuring measures contemplated by the undertaking receiving aid with those adopted by other undertakings operating in the same economic sector, the fact remains that the restructuring of a company must focus on its own specific problems, and the experience of other companies, in different economic and political contexts and at other times, may be irrelevant.

(see para. 478)