Case C-87/01 P: Appeal brought on 21 February 2001 by the Commission of the European Communities against the judgment delivered on 14 December 2000 by the Fourth Chamber of the Court of First Instance of the European Communitics in Case T-105/99 between the Council of European Municipalities and Regions (CEMR) and the Commission of the European Communities
Date: 2001-05-19
Institutions: Court of Justice
Subjects: Council of European Municipalities and Regions, European Commission, General Court (EU), action for annulment (EU), infringement of EU law

C 150/10

EN

Official Journal of the European Communities

19.5.2001

Pleas and main arguments

— Infringement of Article 88 EC

— Infringement of Article 87 EC

the existence of aid for

Contrary to the position maintained by the Court of First
Instance,
the purposes of
Article 87 presupposes not only that an advantage be
conferred on an undertaking but also that that advantage
be financed directly or indirectly through State resources.

In holding that the Commission was under a duty to
consider whether La Poste’s reserved rights in the ordinary
mail sector enabled it to save so much on costs that its
charges for its services did not have to be based on
‘normal market conditions’, the Court of First Instance is
requiring the Commission to search for the causes of
postulated aid, whereas the Court has consistently held
that aid is not identified by its causes or the reasons for
State intervention, but by its effects.

Taking the criterion of the behaviour of a private investor
or operator, the Court of First Instance applies it, not to
the market in which the subsidiary conducts its business
and in which the services provided by the parent company
were used, but to the quite separate market in which the
parent company itself operates. Then it distorts once
again the rule set out in Article 87 EC by disregarding the
‘real life’ situation of public operators and contemplating
instead the situation of private operators as it ideally
should be, that is to say, it constructs a picture of an ideal
market on which an ideal form of competition is at play.
That approach, indirectly but inexorably, calls in question
the policies and measures adopted in recent years in
connection with the opening up of sectors previously not
exposed to competition. Ultimately, it would mean that,
even through the creation of subsidiaries and with
due respect for the principle of transparency, public
undertakings would no longer be able to compete on
those new markets. Also, to accept as a premiss that, in
the case of the public service managed by La Poste, La
Poste’s reserved rights constitute ‘State aid’ which enables
it to cut operating costs and which can be passed on to
its subsidiary in the form of undercharging for services,
implies a premature finding that La Poste receives State
aid for discharging its public service responsibilities and
that this must be removed so that the benefit cannot be
passed on to its subsidiary. That is tantamount to calling
in question, contrary to Article 16 EC, the subsidising of
public services; although, in any event, Article 87 EC
should not be applied to such funding, by virtue of
Article 86(2) EC. Lastly, the approach adopted by the
Court of First Instance appears at odds with the provisions
of Article 86(1) and 82 EC which endorse a costs-based
approach in relation to the fixing of rates for access to
the network.

In criticising the Commission for not considering whether
La Poste was in receipt of aid from the French State, the
Court of First Instance encourages the Commission to act
in breach of the procedure set out in Article 88(2) and in
disregard of the French Government’s right to a fair
hearing.

The Court of First Instance also rebukes the Commission
for failing to determine whether or not La Poste charged
its subsidiary not only its total costs but also the difference
between those and the costs which would have been
borne by La Poste if it had been a private operator with
no reserved market.
In so doing, the Court of First
Instance confuses procedures, out of a desire to ensure
that the entry on to a competitive market of a subsidiary
of a public undertaking is made in ‘normal’ conditions.

Appeal brought on 21 February 2001 by the Commission
of the European Communities against the judgment deliv-
ered on 14 December 2000 by the Fourth Chamber of the
Court of First Instance of the European Communitics
in Case T-105/99 between the Council of European
Municipalities and Regions (CEMR) and the Commission
of the European Communities

(Case C-87/01 P)

(2001/C 150/19)

An appeal against the judgment delivered on 14 December
2000 by the Fourth Chamber of the Court of First Instance of
the European Communities in Case T-105/99 between the
Council of European Municipalities and Regions (CEMR) and
the Commission of the European Communities was brought
before the Court of Justice of the European Communities on
21 February 2001 by the Commission of
the European
Communities, represented by P. Oliver and H.M.H. Speyart,
acting as Agents, with an address for service in Luxembourg.

The appellant claims that the Court should:

— set aside the judgment delivered by the Court of First
Instance on 14 December 2000 in Case T-105/99 and
draw all the legal consequences of the setting aside of
that judgment;

— order the applicant at first instance to pay the costs of the

present appeal.

19.5.2001

EN

Official Journal of the European Communities

C 150/11

Pleas in law and main arguments

— Breach of the principle of Community law relating to the
concept of set-off between claims: the distinction drawn
by the Court of First Instance between ‘actual payment’
and payment by means of set-off does not exist in law,
since those two methods of payment have the same legal
and accounting consequences.

the Communities’

— Breach of the principle of the effectiveness of Community
law: the Court of First Instance was wrong in concentrat-
ing on the proper carrying out of the activities relating to
the payments made by means of set-off without dwelling
on the need to protect
financial
interests. The Court of First Instance did not explain,
moreover, why set-off is more damaging, in respect of
the carrying out of the activities at issue, than enforced
recovery. By stating that the non-payment of the sums
intended for the activities at issue jeopardised the carrying
out of those activities, the Court of First Instance distorted
the facts or failed, at least, to state the reasons for its
observations whereas, indeed, it stated that the CEMR
was not insolvent.

— Breach of the principles of sound financial management
and the sound administration of justice: the Court of First
Instance failed to take account of the main purpose of
set-off, which is economy of procedure and the saving of
costs, not only in the context of mutual
financial
obligations, but also in the context of the sound adminis-
tration of justice.

Appeal brought on 26 February 2001 by the French
Republic against the judgment delivered on 14 December
2000 by the Fourth Chamber (Extended Composition) of
the Court of First Instance of the European Communities
in Case T-613/97 between Union Française de l’Express
(UFEX), DHL International, Federal Express International
(France), CRIE and the Commission of the European
Communities, supported by the French Republic, Chrono-
post SA and La Poste

(Case C-93/01 P)

(2001/C 150/21)

An appeal against the judgment delivered on 14 December
2000 by the Fourth Chamber (Extended Composition) of the
Court of First Instance of the European Communities in Case
T-613/97 between Union Française de l’Express (UFEX), DHL
International, Federal Express International (France), CRIE and
the Commission of the European Communities, supported by
the French Republic, Chronopost SA and La Poste, was brought
before the Court of Justice of the European Communities on
26 February 2001 by the French Republic, represented by
G. de Bergues and F. Million, acting as Agents, with an address
for service in Luxembourg.

The appellant claims that the Court should:

— set aside the judgment of the Court of First Instance;

Reference for a preliminary ruling by the Monomeles
Dioikitiko Protodikeio Irakliou (Second Chamber) by
judgment of that court of 31 October 2000 in the case of
G. Stilianakis against the Greek State

— order the UFEX to pay the costs incurred in the proceed-
ings before the Court of Justice and make a fresh ruling
in relation to the costs incurred in the proceedings before
the Court of First Instance.

(Case C-92/01)

(2001/C 150/20)

Reference has been made to the Court of Justice of the
European Communities by judgment of the Monomeles Dioiki-
tiko Protodikeio Irakliou (Administrative Court of First
Instance, Heraklion), Second Chamber, of 31 October 2000,
received at the Court Registry on 22 February 2001, for a
preliminary ruling in the case of G. Stilianakis against the
Greek State on the following question:

Are Articles 8a and 59 of the EC Treaty and Article 3(1) of
Council Regulation No 2408/92 (1)
to be interpreted as
prohibiting a Member State from imposing a differentiated
fiscal charge on domestic and intra-Community flights with
the direct result that an amount of tax is charged on intra-
Community flights double that on flights within the Member
State?

(1) OJ L 240 of 24.8.1992, p. 8.

Pleas and main arguments

— Misinterpretation of

‘normal market conditions’: The
Court of First Instance erred in holding that when the
Commission carried out an analysis of the economic
factors on the basis of which it was considered possible
to assess whether remuneration was ‘normal’, it should
have taken into account the implications for La Poste’s
costs — hence on the remuneration requested from its
subsidiary — of
its structural situation (its reserved
sector).

The approach espoused by the Court of First Instance has
no basis in reality, since a private operator with no
reserved activities would never wish to equip itself with a
network like the La Poste network, which was developed
solely to meet the needs of the reserved sector. Moreover,
no private operator desires access to the La Poste network,
despite the allegedly cheaper rates offered.