Keywords

Summary



Keywords

1 Actions for annulment - Decision concerning State aid - Complaints not raised during the administrative procedure - Whether admissible

(EC Treaty, Arts 93(2) and 173)

2 State aid - Concept - Financial assistance granted by a Member State to an undertaking - Criterion of assessment - Situation of the undertaking in relation to the private capital markets - Loan granted at a preferential rate - Refund of the difference between the interest payable at the market rate and that actually paid

(EC Treaty, Art. 92(1))

3 State aid - Commission decision finding unnotified aid to be incompatible with the common market - Obligation to state reasons - Scope

(EC Treaty, Arts 92, 93(3) and 190)

Summary

4 In the field of State aid no provision makes the right of a person directly and individually concerned to challenge a measure addressed to a third party conditional upon all the complaints set out in the application having been raised during the administrative procedure. In the absence of such a provision, the right of such a person to bring proceedings cannot be restricted on the basis only of the fact that, although he could, during the administrative procedure, have submitted observations on an assessment disclosed when the Article 93(2) procedure was opened and then repeated in the contested decision, he failed to do so.

5 In order to determine whether financial assistance granted by a Member State to an undertaking has the character of State aid, the relevant criterion is whether the undertaking receiving the aid could have obtained the amounts in question on the capital market. In particular, the relevant question is whether a private investor would have entered into the transaction in question on the same terms and, if not, on which terms he could have entered into the transaction.

In the case of a loan granted at a preferential rate, the Commission may rightly classify as aid incompatible with the common market the difference between the interest which would have been paid at the market rate and the interest actually paid, and not the sum lent.

The private investor test also enables the Commission to determine the measures to be taken under Article 93(2) of the Treaty in order to remove any distortions of competition which are found and to restore the situation prevailing prior to payment of the unlawful aid, having due regard to the principle of proportionality. If a fundamental distinction cannot be established depending on whether aid is granted in the form of a loan or in the form of a capital injection, the uniform application of the private investor test in both cases may nevertheless, having due regard to the principle of proportionality, require different measures to be adopted in order to eliminate distortions of competition found and to restore the situation prevailing prior to the payment of the unlawful aid.

The principle of proportionality requires the adoption of the measures necessary to ensure healthy competition on the internal market which least harm the promotion of a harmonious and balanced development of economic activities throughout the Community.

Since a sum provided in the form of a contribution to share capital is transferred on a permanent basis whereas a sum provided by way of loan, being repayable, is made available only temporarily, the rule of proportionality requires, as a matter of principle, the adoption of different measures in the two cases. Where an equity injection is involved, the Commission can take the view that abolition of the advantage granted must require the repayment of the capital contributed. As regards a loan, on the other hand, if the competitive advantage resides in the grant of a preferential interest rate and not in the actual value of the funds made available, the Commission, instead of requiring the principal sum simply to be repaid, is justified in requiring the interest rate which would have been charged under normal market conditions to be applied and the difference between the interest which would have been paid under those conditions and the interest which was actually paid on the basis of the preferential rate to be repaid.

6 The statement of reasons required by Article 190 of the Treaty must explain clearly and unambiguously the reasoning of the Community authority which drew up the contested decision so as to enable the persons concerned to ascertain the matters justifying the measure adopted so that they can defend their rights and the Community judicature can carry out its review. However, it is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 190 of the Treaty must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question.

In stating the reasons for the decisions which it has to take in order to ensure that the rules of competition are applied, the Commission is not obliged to take a position on all the arguments relied on by the parties concerned. It is sufficient if it sets out the facts and legal considerations having decisive importance in the context of the decision.

When applied to decisions finding that measures constitute State aid, this principle requires that the reasons for which the Commission considers that the aid measure in question falls within the scope of Article 92(1) of the Treaty should be indicated.