Keywords

Summary



Keywords

1. Actions for annulment – Natural or legal persons – Measures of direct and individual concern to them – Commission decision finding State aid compatible with the common market without opening the formal investigation procedure

(Arts 88(2) and (3) EC and 230, fourth para., EC)

2. State aid – Planned aid – Examination by the Commission – Preliminary review and main review – Compatibility of the aid with the common market – Difficulties of assessment

(Art. 88(2) and (3) EC)

Summary

1. Direct concern requires that the impugned Community measure directly produces effects on the legal situation of the individual concerned and leaves no discretion to the addressees of that measure who are entrusted with the task of implementing it and such implementation must be purely automatic and follow solely from the Community rules, without the application of other intermediate rules. In the case of a decision authorising aid, the same applies where the possibility that the national authorities will decide not to grant the aid authorised by the contested Commission decision is purely theoretical and there is no doubt that those authorities intend to act in that way.

Where, without initiating the formal investigation procedure under Article 88(2) EC, the Commission finds, by a decision adopted on the basis of Article 88(3) EC, that aid is compatible with the common market, the persons intended to benefit from those procedural guarantees may secure compliance therewith only if they are able to challenge that decision before the Community judicature. For those reasons, an action for the annulment of such a decision brought by a person who is concerned within the meaning of Article 88(2) EC is admissible where he seeks, by instituting proceedings, to safeguard the procedural rights available to him under the latter provision.

The parties concerned within the meaning of Article 88(2) EC who are thus entitled under the fourth paragraph of Article 230 EC to institute proceedings for annulment are those persons, undertakings or associations whose interests might be affected by the grant of the aid, in particular undertakings competing with the beneficiaries of that aid and trade associations.

On the other hand, if the applicant challenges the substance of the decision appraising the aid as such, the mere fact that it may be regarded as concerned within the meaning of Article 88(2) EC cannot suffice to render the action admissible. The applicant must then demonstrate that it has a particular status within the meaning of the judgment in Case 25/62 Plaumann v Commission . That would apply in particular where the applicant’s market position is substantially affected by the aid to which the decision at issue relates.

(see paras 36, 42-44)

2. The procedure for reviewing State aid provided for in Article 88(2) EC is obligatory where the Commission experiences serious difficulties in establishing whether or not aid is compatible with the common market. The Commission cannot therefore limit itself to the preliminary procedure under Article 88(3) EC and take a favourable decision on a State measure unless it is in a position to reach the firm view, following an initial examination, that the measure cannot be classified as aid within the meaning of Article 87(1) EC or that the measure, while constituting aid, is compatible with the common market. On the other hand, if the initial examination results in the Commission taking the contrary view to the aid’s compatibility with the common market, or if it does not put the Commission in a position to overcome all the problems raised by its assessment of the compatibility of the measure in question with the common market, the Commission has a duty to obtain all the necessary views and, to that end, to initiate the procedure under Article 88(2) EC.

Thus, it is for the Commission to decide, on the basis of the factual and legal circumstances of the case, whether the difficulties involved in assessing the compatibility of the aid require the initiation of that procedure. That decision must satisfy three requirements.

Firstly, under Article 88 EC the Commission’s power to find aid to be compatible with the common market upon the conclusion of the preliminary examination procedure is restricted to aid measures that raise no serious difficulties. That criterion is thus an exclusive one. The Commission may not, therefore, decline to initiate the formal investigation procedure in reliance upon other circumstances, such as third party interests, considerations of economy of procedure or any other ground of administrative convenience.

Secondly, where it encounters serious difficulties, the Commission must initiate the formal procedure, having no discretion in this regard. Whilst its powers are circumscribed as far as initiating the formal procedure is concerned, the Commission nevertheless enjoys a certain margin of discretion in identifying and evaluating the circumstances of the case in order to determine whether or not they present serious difficulties. In accordance with the objective of Article 88(3) EC and its duty of good administration, the Commission may, amongst other things, engage in talks with the notifying State or with third parties in an endeavour to overcome, during the preliminary procedure, any difficulties encountered.

Thirdly, the notion of ‘serious difficulties’ is an objective one. Whether or not such difficulties exist requires investigation of both the circumstances under which the contested measure was adopted and its content. That investigation must be conducted objectively, comparing the grounds of the decision with the information available to the Commission when it took a decision on the compatibility of the disputed aid with the common market.

(see paras 70-74)