Judgment of the General Court (First Chamber) of 23 September 2020 –

Fundación Tecnalia Research & Innovation v Commission

(Case T‑314/19)

(Arbitration clause – Grant agreement concluded in the framework of the Seventh Framework Programme for research, technological development and demonstration activities (2007-2013) – Development and testing of sensor systems for quality and performance control in baking processes – Bread-Guard Project – Overlap of the project with another project financed under the same programme – Changes to the description of the tasks to be undertaken – Loss of the intellectual property rights required for the execution of the project – Overestimation of the number of people needed each month for the project – Beneficiaries’ duty to provide information – Serious misconduct – Termination by the Commission of the grant agreement)

1. Judicial proceedings – General Court seised under an arbitration clause – Grant agreement concluded in the framework of a specific programme for research, technological development and demonstration activities – Overlap of the subsidised project with another project funded under the same programme – Finding of non-compliance with contractual obligations – Unilateral termination of the grant agreement by the Commission due to a breach of the contractual terms concerning the obligation on the beneficiaries to provide information and an overestimation of the number of people needed to execute that agreement – Joint and several liability of contractors – Scope (Art. 272 TFEU) (see paras 45, 48, 50, 55, 57, 62, 76, 77, 80-83, 87, 90-92, 98, 101)

2. Judicial proceedings – General Court seised under an arbitration clause – Grant agreement concluded in the framework of a specific programme for research, technological development and demonstration activities – Overlap of the subsidised project with another project funded under the same programme – Finding of non-compliance with contractual obligations – Unilateral termination of the grant agreement by the Commission due to a breach of the contractual terms concerning the obligation on the beneficiaries to provide information – Serious professional misconduct – Definition – Conditions – Need for a specific and individual assessment of the conduct alleged against the economic operator (Art. 272 TFEU) (see paras 102, 110)

3. Judicial proceedings – General Court seised under an arbitration clause – Grant agreement concluded in the framework of a specific programme for research, technological development and demonstration activities – Overlap of the subsidised project with another project funded under the same programme – Unilateral termination of the grant agreement by the Commission due to a breach of the contractual terms concerning the obligation on the beneficiaries to provide information – Action for contractual liability – Invocation of the principle of proportionality – Whether permissible – Obligation to perform the contract in good faith (Art. 5(4) TEU; Art. 272 TFEU) (see paras 107, 108)

Re:

Application pursuant to Article 272 TFEU seeking a declaration that the Commission was not justified in terminating the grant agreement relating to the FP7-KBBE-2013-7-613647 BreadGuard Project.

Operative part

The Court:

1. Dismisses the action;