Keywords

Summary



Keywords

1. Actions for annulment — Jurisdiction of the Courts of the European Union — Claim seeking that directions be issued to an institution — Not permissible

(Arts 263 TFEU and 266 TFEU)

2. ECSC — Aid to the steel industry — Recovery of unlawful aid — Non-notified aid measures — Inaction of the Commission for a relatively long period — Legal certainty — Protection — Conditions and limits — Exceptional circumstances

(Art. 4(c) CS)

3. ECSC — Aid to the steel industry — Recovery of unlawful aid — Non-notified aid measures — Inaction of the Commission for a relatively long period — No infringement of the principle of legal certainty — Examination by the General Court

4. ECSC — Scope of the Treaty — State aid rules — Applicability of the provisions of the EC Treaty only in the alternative

(Art. 305(1) EC)

5. ECSC — Aid to the steel industry — Concept — Assessment solely in the context of the relevant provisions of the ECSC Treaty — Taking into account of an earlier decision-making practice of the Commission — Not included

(Art. 4(c) CS)

6. ECSC — Scope of the Treaty — State aid rules — Application to all the activities of a steel undertaking — Conditions — Real risk that that aid will be diverted in favour of production activities which fall within that scope of the ECSC Treaty — Concept

(Arts (4)(c) CS, 80 CS and 81 CS)

7. ECSC — Aid to the steel industry — Concept — Measures pursuing an environmental objective — Included

(Art. 4(c) CS)

8. Acts of the institutions — Temporal application — Retrospective effect of a substantive rule — Conditions — Non-retroactivity of steel aid code rules

(Arts 2 CS to 4 CS; General Decision No 2496/96)

9. Acts of the institutions — Statement of reasons — Obligation — Scope — Commission decision on State aid

(Arts 4(c) CS and 15 CS; Art. 253 EC)

10. ECSC — Aid to the steel industry — Recovery of unlawful aid — Restoration of the prior situation — Aid in the form of a tax deferral — Recovery of all the interest not paid by the beneficiary — Determination of a reference rate — Discretion of the Commission — Judicial review — Limits

(Art. 4(c) CS)

11. ECSC — Aid to the steel industry — Recovery of unlawful aid — Application of national law — Deduction, by the national authorities, of certain sums from the amount to be recovered — Limits

(Art. 4(c) CS)

Summary

1. See the text of the decision.

(see para. 19)

2. Even in a situation in which the Community legislature has not laid down any period of limitation, the fundamental requirement of legal certainty prevents the Commission from indefinitely delaying the exercise of its powers.

Nevertheless, the notification of State aid by the Member States is a central element of Community rules to supervise that aid and that, therefore, in the absence of notification, undertakings to which such aid is granted cannot entertain a legitimate expectation.

In that regard, the particularly strict nature of the State aid regime under the ECSC Treaty sets it apart from the State aid regime under the EC Treaty.

Accordingly, where aid was granted under the ECSC Treaty without having been notified, a delay by the Commission in exercising its supervisory powers and ordering recovery of the aid does not render that recovery decision unlawful, except in exceptional cases which show that the Commission manifestly failed to act and clearly breached its duty of diligence.

(see paras 23-26)

3. See the text of the decision.

(see paras 27-67)

4. See the text of the decision.

(see paras 51, 52)

5. See the text of the decision.

(see para. 66)

6. By virtue of Articles 80 CS and 81 CS, only undertakings engaged in production in the coal or steel industry are governed by the rules of the ECSC Treaty. In that regard, only the goods listed in Annex I to the ECSC Treaty are covered by the terms ‘coal’ and ‘steel’. Accordingly, an undertaking is subject to the prohibition laid down in Article 4(c) CS only in so far as it is engaged in such production.

Nevertheless, the fact that an undertaking is engaged in production in the steel industry does not mean that all its activities are to be regarded as activities falling within the scope of the ECSC Treaty. In that regard, in undertakings manufacturing both goods falling within the scope of the ECSC Treaty and goods within the scope of the EC Treaty, the application of the ECSC Treaty to aid intended to support an area of production outside the scope of that treaty may be justified where there is a real risk that that aid will be diverted in favour of production activities which do fall within that scope. Having regard, on the one hand, to the special features of the steel sector and, on the other, to the strict and absolute prohibition of State aid laid down in Article 4(c) CS, it would run counter to the aims of the system established by the ECSC Treaty to subject to the less rigorous rules of the EC Treaty the examination of aid which could possibly be used for the benefit of those areas of an undertaking’s production which fall within the scope of the ECSC Treaty.

The condition relating to a real risk that that aid will be diverted is met, inter alia, if the organisation of the applicant’s activities does not provide sufficient guarantees to prevent diversion of the investment grant at issue to its ECSC production activities and thus an effect on competition on the market to which the ECSC Treaty applies. Accordingly, the risk of diversion must be established by serious evidence which gives reasonable grounds to suppose that the aid may, in view of the circumstances of the case, be the subject of a diversion in favour of the ECSC activities of the steel undertaking concerned.

(see paras 75, 77, 78, 80)

7. Even if environmental protection constitutes one of the essential objectives of the European Union, the need to take that objective into account does not justify the exclusion of selective measures from the scope of Article 4(c) CS. To determine whether a national measure may be classified as State aid, it is not its aim that is important, but its effects. Accordingly, the environmental objective pursued by State measures is not sufficient to exclude those measures outright from classification as ‘aid’.

(see paras 98, 99)

8. Unlike the provisions of the EC Treaty on State aid, which permanently empower the Commission to adopt decisions on its compatibility, the Steel Aid Codes confer such power on the Commission for a specified period only. Accordingly, where aid is not notified to the Commission during the period laid down by a code to that effect, the Commission can no longer give a decision on the compatibility of that aid under that code. Therefore, once the period of applicability of the code has expired, the Commission is no longer empowered to authorise aid to the steel industry under the derogations provided if that aid has not been notified in accordance with that code.

Furthermore, it follows from the principle of legal certainty that the compatibility of aid with the common market can be assessed, in the context of the Steel Aid Codes, only in the light of the rules in force on the date on which it is actually paid. In that regard, the substantive rules of Community law must be interpreted as applying to situations existing before their entry into force only in so far as it clearly follows from their terms, objectives or general scheme that such effect must be given to them.

With regard, in particular, to the Sixth Steel Aid Code, no provision of that code provides that it may be applied retroactively. Moreover, it is clear from the general scheme and the objectives of successive aid codes that each of them lays down rules for the adaptation of the steel industry to the objectives laid down in Articles 2, 3 and 4 CS according to the needs existing at any given period. Accordingly, application of the rules adopted at a particular period, according to the then prevailing situation, to aid paid in the course of an earlier period would correspond neither to the general scheme nor to the objectives of that type of rules.

(see paras 103-105, 109)

9. See the text of the decision.

(see paras 112-115)

10. The recovery of State aid unlawfully granted is intended to restore the situation existing prior to the grant of that aid and cannot, in principle, be regarded as disproportionate to the objectives of the provisions of Article 4(c) CS. That recovery must, nevertheless, be limited to the financial advantages actually arising from the placing of the aid at the disposal of the beneficiary, and be proportionate to them. Accordingly, in the event that the aid granted takes the form of a tax deferral over several years and, therefore, an interest-free government advance or an interest-free loan, it is appropriate, with a view to approaching the re-establishment of the previous situation, to order the recovery of all the interest that the beneficiary would have had to pay at the market rates.

The Commission, with a view to ordering that the previous situation be restored, has power to determine the rate of interest enabling such restoration to be effected. Therefore, when reviewing the legality of the exercise of such a power, the European Union judicature must not substitute its own assessment in the matter for that of the Commission, but examine whether the Commission’s assessment is vitiated by a manifest error or misuse of powers.

With regard to the determination of the applicable rates, the reference rates are supposed to represent the average level of interest rates in force in each of the Member States. The reference rates are therefore a valid indication of the market rates for loans for industrial investments. In that regard, for reasons of legal certainty and equality of treatment, the Commission may consider, as a general rule, that it is legitimate to apply the reference rate in force during a certain period to all loans granted during that period. Moreover, it is legitimate for the Commission to take the rates laid down for the evaluation of regional aid schemes, as published periodically in the Official Journal of the European Communities , since those favourable rates, applicable to financially successful undertakings, would have been used, if the scheme at issue had been notified, in order to determine whether it contained aid elements.

(see paras 137-143)

11. See the text of the decision.

(see paras 165-167)