Case C-73/03: Action brought on 19 February 2003 by the Kingdom of Spain against the Commission of the European Communities
Date: 2003-04-26
Institutions: Court of Justice
Subjects: European Commission, Spain, State aid, action for annulment (EU), agricultural holding, interest rate subsidy, loan, tax system

C 101/20

EN

Official Journal of the European Union

26.4.2003

Action brought on 14 February 2003 by the Commission
of the European Communities against the Federal Repub-
lic of Germany

(Case C-64/03)

(2003/C 101/33)

An action against the Federal Republic of Germany was
brought before the Court of Justice of the European Communi-
ties on 14 February 2003 by the Commission of the European
Communities, represented by Jürgen Grunwald, Legal Adviser
to the Commission of the European Communities, and Hans
Støvlbæk, of the Legal Service of the Commission of the
European Communities, acting as Agents, with an address for
service in Luxembourg at the office of Carlos Gómez de la
Cruz, of the European Commission’s Legal Service, Wagner
Centre C 254, Kirchberg.

The applicant claims that the Court should:

1.

declare that, by failing to bring into force the laws,
regulations and administrative provisions necessary to
comply with Directive 98/30/EC (1) of the European
Parliament and of the Council of 22 June 1998 concern-
ing common rules for the internal market in natural gas,
the Federal Republic of Germany has failed to fulfil its
obligations under Article 29 of that directive;

2.

order the Federal Republic of Germany to pay the costs
of the proceedings.

Pleas in law and main arguments

Although the period for transposition of Directive 98/30/EC
expired on 10 August 2000, the Federal Republic of Germany
has thus far failed to transpose at all or failed to transpose
adequately a number of provisions of that directive.

— The Federal Republic of Germany has failed totally to

transpose:

— Article 5 in conjunction with Articles 7(3) and 10(3):
it is clear that there have been no notifiable and
technically verifiable ‘technical rules establishing
the minimum technical design and operational
requirements’ for the ‘connection to the system of
LNG facilities, storage facilities, other transmission
or distribution systems, and direct lines’. At any rate,
no such technical rules have been notified to the
Commission, nor is the Commission aware of any
such rules;

— Articles 14 to 16: there are no provisions dealing
with access to the system. The reference to prohib-
itions under competition law is not sufficient as
these do not contain any rules on access;

— Articles 12 and 13: there are no rules under the laws
specifically governing natural gas which deal with
the unbundling of the accounts of integrated natural
gas undertakings;

— The Federal Republic of Germany has failed adequately to

transpose:

— Article 2: defining provisions contained in a measure
of Community law must, inasmuch as they are —
as here — necessary for the proper application of
the Community provisions by national bodies, be
correctly transposed in national law;

— Articles 7(2) and 10(2): the general competition
rules under national law apply only to undertakings
in a dominant market position and for that reason
do not constitute an adequate transposition of the
prohibition of discrimination;

— Article 15(1)

in conjunction with Article 17(1):
unlike the position in the electricity sector, German
law does not provide for an obligation to state
reasons in the event of refusal to grant access to the
system;

— Article 18: no criteria governing the designation of
eligible customers have been published or notified
to the Commission;

— Article 21(2): the arbitration authority provided for

in Article 21(2) has not been designated.

(1) OJ L 204 of 21.7.1998, p. 1.

Action brought on 19 February 2003 by the Kingdom of
Spain against the Commission of the European Communi-
ties

(Case C-73/03)

(2003/C 101/34)

An action against the Commission of the European Communi-
ties was brought before the Court of Justice of the European
Communities on 19 February 2003 by the Kingdom of Spain,
represented by S. Ortiz Vaamonde, Abogado del Estado, with
an address for service in Luxembourg.

26.4.2003

EN

Official Journal of the European Union

C 101/21

The applicant claims that the Court should:

— annul

the Commission’s decision of 11 December
2002 (1), in so far as it finds that the subsidising of loans
and guarantees for owners of agricultural holdings and
the extension of tax benefits to the transfer of agricultural
land and holdings constitute State aid incompatible with
the Treaty;

— order the Commission to pay the costs.

Pleas in law and main arguments

much larger amount, against which the Commission had
publicly advised but which was adopted in other Member
States such as France, Germany or Italy. It can in no
way be maintained that Spanish operators enjoyed an
economic advantage to which those of other Member
States did not have access.

— (In the alternative) If State aid is found to exist,

it is
compatible with the common market in the light of
Article 87(2)(b) EC: neither the objective nor the result of
the alleged aid was to cover loss suffered by the farmer:
the intention was to make it easier for him to obtain a
loan from financial institutions so that the loans would
make up for the lack of liquidity brought about by the
disproportionate increase in costs caused by the steep
rises in fuel prices. If, following the Commission’s rec-
ommendation not to reduce the special tax on fuel oils
or value added tax, no alternative measures were adopted,
Spanish farmers would become less competitive in their
trade by comparison with States which implemented
permitted, although not recommended, tax reductions.

(The extension of certain tax benefits to transfers of land)

— (In the alternative) Compatibility of the measures in the

light of Article 87(3)(c) EC.

— This does not constitute State aid since certain undertak-
ings or the production of certain goods are not specifically
favoured: the measure entails a lower tax burden for the
seller of the land and has an impact on the owner (farmer)
purchasing land: not as to the amount but as to the
greater availability of land for sale because of the lower
capital gains tax charge for the seller.

— (in the alternative) The aid is compatible with the
Community guidelines for State aid in the agricultural
sector: A farmer who invests in the acquisition of land,
and is the owner of a priority holding, by definition
satisfies the requirements set out in point 4.1 of the
Community guidelines as regards the economic viability
of the holding and the occupational skill required for the
grant of structural aid cofinanced by the EU under the
Regulation on improving the efficiency of agricultural
structures in force at the material time.

(The subsidising of
agricultural holdings

loans and guarantees for owners of

— This does not constitute State aid within the meaning of
Article 87 EC since it does not affect trade between
Member States: The Spanish measure entailing the sub-
sidising of loans was actually symbolic in the face of a
sector which felt that its economic viability was seriously
threatened by the exceptional fuel-price increase. It is
paradoxical that a palliative measure of such a slight
unitary significance should give rise to a decision of
incompatibility with the common market when it was
adopted as an alternative to a reduction in taxes of a

(1) Relating to measures taken by Spain to support agriculture

following the fuel price increase.

Reference for a preliminary ruling by the Østre Landsret
by order of that Court of 14 February 2003 in the case of
SmithKline Beecham plc against Lægemiddelstyrelsen;
interveners being Synthon BV and Genthon BV

(Case C-74/03)

(2003/C 101/35)

Reference has been made to the Court of
Justice of the
European Communities by order of the Østre Landsret (Eastern
Regional Court) of 14 February 2003, received at the Court
Registry on 19 February 2003, for a preliminary ruling in the
case of SmithKline Beecham plc against Lægemiddelstyrelsen
(Danish Medicinal Products Administration); interveners being
Synthon BV and Genthon BV on the following questions: