Keywords

Summary



Keywords

1. State aid – General aid scheme approved by the Commission – Individual aid presented as being covered by the approval – Examination by the Commission

(Arts 87 EC and 88 EC)

2. State aid – Prohibition – Exceptions

(Arts 87(1) and (3) EC and 88(3) EC; Commission Notice 1999/C 288/02, para. 3)

3. State aid – Prohibition – Exceptions – Commission Notice on the framework for State aid for firms in difficulty

(Commission Notice 1999/C 288/02, paras 4 to 6)

4. Acts of the institutions – Statement of reasons – Obligation – Scope – Commission decision on State aid – Calculation of the amount of aid for a firm in difficulty

(Arts 87 EC and 253 EC; Commission Notice 1997/C 273/03)

Summary

1. When it has before it a specific grant of aid alleged to have been made in pursuance of a previously authorised scheme, the Commission cannot at the outset examine it directly in relation to the Treaty. Prior to the initiation of any procedure, it must first confine itself to examining whether the aid is covered by the general scheme and satisfies the conditions laid down in the decision approving that general scheme. If it did not do so, the Commission could, whenever it examined an individual aid measure, go back on its decision approving the aid scheme, which already presupposed an examination in the light of Article 87 EC. Aid which constitutes a strict and foreseeable application of the conditions laid down in the decision approving the general aid scheme is thus considered to be existing aid which does not have to be notified to the Commission or examined in the light of Article 87 EC.

A Commission decision ruling on whether an aid measure is consistent with the relevant scheme comes within the scope of the Commission’s obligation to ensure the application of Articles 87 EC and 88 EC. Consequently, the Commission’s examination of the conformity of an aid measure with that scheme does not constitute a step that exceeds its powers. The Commission’s assessment cannot therefore be limited by the assessment of the national authorities which granted the aid.

(see paras 59-60, 62, 136)

2. According to paragraph 3 of the Community guidelines on State aid for rescuing and restructuring firms in difficulty, which the Commission was entitled to adopt in order to exercise the wide discretion that it enjoys for the purposes of the application of Article 87(3) EC and by which it is governed, ‘State aid for rescuing firms in difficulty from bankruptcy and helping them to restructure may only be regarded as legitimate subject to certain conditions’. That is the reason why those guidelines provide that there is a duty to notify the Commission in advance of any funding provided or guaranteed by the State to a firm that is in financial difficulties.

It cannot be accepted that there is a specific definition of the concept of a firm in difficulty for the purposes of an approved regional aid scheme. Acceptance that different definitions of the concept of a firm in difficulty can exist alongside each other might create a situation in which a firm that is in difficulty according to those guidelines might nevertheless benefit from State aid without that aid having to be notified and without compliance with those guidelines. Such a situation would, however, be contrary to the broad logic of Article 87(1) and (3) EC and Article 88(3) EC as clarified by those guidelines.

(see paras 74, 76)

3. Paragraph 4 of the Community guidelines on State aid for rescuing and restructuring firms in difficulty merely states in general terms that a firm is regarded as being in difficulty where it is unable, whether through its own resources or with the funds that it is able to obtain from its owner/shareholders or creditors, to stem losses which, without outside intervention by the public authorities, would almost certainly condemn it to go out of business in the short or medium term. Furthermore, the wording of paragraphs 5 and 6 of those guidelines shows that, although a firm is ‘in any event’ regarded as being in difficulty where a material part of its share capital has disappeared, other evidence, such as the factors set out in paragraph 6, may also be used to establish that it is in financial difficulty for the purposes of those guidelines, even if it has not lost a significant part of its share capital.

Thus, a material reduction in the share capital is a very serious factor signalling that an undertaking is in difficulty. In addition, there are a number of economic factors, of which paragraph 6 of those guidelines contains a non-exhaustive list, which may also indicate that an undertaking is in difficulty, even if the undertaking has not lost a significant part of its share capital or is not insolvent within the terms of paragraph 5 of those guidelines.

(see paras 103-105, 133, 135)

4. The scope of the duty to state reasons depends on the nature of the measure in question and on the context in which it was adopted. The statement of reasons must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure, so as to enable the persons concerned to ascertain the reasons for it in order that they can defend their rights and ascertain whether or not the measure is well founded and to enable the Courts of the European Union to exercise their power of review. It is not necessary for the statement of reasons to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 253 EC 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 particular, the Commission is not obliged to adopt a position on all the arguments relied on by the parties concerned, it being sufficient if it sets out the facts and legal considerations which have decisive importance in the context of the decision.

It is, however, necessary to annul a Commission decision finding State aid to be incompatible with the common market which does not contain any reference, in its calculation of the amount of aid for undertakings in difficulty, to the practice of the financial markets on risk accumulation (undertaking in difficulty, lack of security, etc.), since the relationship between the premiums fixed by the Commission and the specific situation of the undertakings concerned does not become clear and the premiums fixed give, at least, the impression of having been randomly chosen, and the Commission notice concerning the method for fixing the reference and discount rates does not contain any indication as to that risk accumulation. The Commission ought to have explained why it resorted to additional premiums and how it chose their amounts by way of an analysis of market practice in order to allow those undertakings to question whether the premiums were appropriate and to enable the Court to review their legality.

(see paras 180, 217-218)