Keywords

Summary



Keywords

1. State aid – Recovery of unlawful aid – Aid granted in infringement of the procedural rules under Article 88(3) EC – Commission decision declaring the aid compatible with the common market – Annulment of that decision by the Community judicature

(Art. 88(3) EC)

2. State aid – Compliance with Community rules – Role of the national courts

(Art. 88(3) EC)

3. State aid – Recovery of unlawful aid – Aid granted in infringement of the procedural rules under Article 88(3) EC – Possible legitimate expectation on the part of the recipients – None save for exceptional circumstances

(Art. 88(3) EC)

Summary

1. A national court before which an application has been brought, on the basis of Article 88(3) EC, for repayment of unlawful State aid may not stay the adoption of its decision on that application until the Commission has ruled on the compatibility of the aid with the common market following the annulment of a previous positive decision.

Article 88(3) EC entrusts the national courts with the task of preserving, until the final decision of the Commission, the rights of individuals faced with a possible breach by State authorities of the prohibition laid down by that provision.

The objective of the national courts’ tasks is therefore to pronounce measures appropriate to remedy the unlawfulness of the implementation of the aid, in order that the aid may not remain at the free disposal of the recipient during the period remaining until the Commission makes its decision.

A decision to stay proceedings would, de facto, have the same effect as a decision to refuse the application for safeguard measures. It would have the effect that no decision on the merits of that application would be taken before the Commission’s decision. It would amount to maintaining the benefit of aid during the period in which implementation is prohibited, which would be inconsistent with the very purpose of Article 88(3) EC and would render that provision ineffective.

Therefore, the national court cannot stay the proceedings without rendering Article 88(3) EC ineffective, contrary to the principle of effectiveness of the applicable national procedures.

The annulment by the Community judicature of a first positive Commission decision cannot justify any different conclusion prompted by the consideration that, in that case, the aid might subsequently be once again declared compatible by the Commission. The purpose of Article 88(3) EC is clearly prompted by the consideration that, until a new decision has been adopted by the Commission, it cannot be presumed that that decision will be positive in its content.

(see paras 26, 30-34, 40, operative part 1)

2. A national court before which an application has been brought, on the basis of Article 88(3) EC, for repayment of unlawful State aid, is obliged to adopt safeguard measures only if the conditions justifying such measures are satisfied, namely, that there is no doubt regarding the classification as State aid, that the aid is about to be, or has been, implemented, and that no exceptional circumstances have been found which would make recovery inappropriate. If those conditions are not satisfied, the national court must dismiss the application. When ruling on the application, it may order the repayment of the aid with interest or, for example, the placement of the funds on a blocked account so that they do not remain at the disposal of the recipient, without prejudice to the payment of interest for the period between the expected implementation of the aid and its placement on that blocked account. By contrast, the ‘standstill’ obligation set out in Article 88(3) EC would not be fulfilled, at that stage, by simply ordering interest to be paid on amounts which remain in the accounts of the undertaking. It is in no way established that an undertaking which has unlawfully received State aid could, were it not for that aid, have obtained an equivalent amount by way of loan from a financial institution under normal market conditions and thus have that amount at its disposal prior to the Commission decision.

(see paras 36-38)

3. The adoption by the Commission of three successive decisions declaring aid to be compatible with the common market, which were subsequently annulled by the Community judicature, is not, in itself, capable of constituting an exceptional circumstance such as to justify a limitation of the recipient’s obligation to repay that aid, in the case where that aid was implemented contrary to Article 88(3) EC.

The unusual succession of three annulments reflects, a priori, the difficulty of the case and, far from giving rise to a legitimate expectation, would rather appear likely to increase the recipient’s doubts as to the compatibility of the disputed aid.

It may, admittedly, be acknowledged that a succession of three actions leading to three annulments amounts to a very unusual situation. Such circumstances, however, arise as part of the normal operation of the judicial system, which grants individuals who believe that they have suffered as a result of the unlawfulness of aid the possibility of bringing proceedings for the annulment of successive decisions which they consider to be the cause of that situation.

(see paras 51-52, 55, operative part 2)