Case C-274/03: Action brought on 24 June 2003 by the Commission of the European Communities against Ireland
Date: 2003-08-23
Institutions: Court of Justice
Subjects: European Commission, Ireland, action for failure to fulfil an obligation, motor vehicle insurance, third-party insurance

C 200/18

EN

Official Journal of the European Union

23.8.2003

Pleas in law and main arguments

Applicant

The
C(2003)1084 should be annulled on the following grounds:

Commission

submits

that

Decision

not developed until several years after the conclusion of the
projects in issue in circumstances where the procedures used
were at all times in accordance with best practice at the time
as approved by the Commission amounts to a retrospective
application of Community rules by the Commission.

I. Manifest error of approach or assessment by the Commis-

sion

IV. Breach of

the principle of proportionality and/or the

principles in relation to the imposition of penalties

a)

b)

c)

d)

The Irish Authorities do not accept the validity of the
extrapolation exercise purportedly carried out by the
Commission and submit
that extrapolation is not an
establishing a monetary
acceptable methodology for
repayment value in the case of very broadly-based grant
schemes such as the Operational Programme for Tourism,
1989 — 1993. Further, it is submitted that the Commis-
sion has failed to identify the legal basis on which the
is
extrapolation exercise it has purported to carry out
based.

The application by the Commission of its own definition
of the meaning of the terms of Article 23 of Regulation
4253/88 (1)
in a manner that permits it to extend the
scope of its powers amounts to an infringement of the
express provisions of that article and constitutes a mani-
fest error of assessment on the part of the Commission in
the exercise of
to Article 24
its discretion pursuant
thereof.

It is manifestly erroneous of the Commission to seek to
justify imposing a penalty on Ireland on the basis of
Datasheets, published in April 1997, several years after
the Programme finished on the basis that they represented
a codification of previously established practice, when this
general practice had not been established by either the
Commission or the European Court of Auditors in their
monitoring of the Programme.

is furthermore submitted that

the Commission was
It
manifestly wrong in concluding that there were errors or
risks inherent in the reporting system developed by the
Irish authorities.

II. Infringement of a fundamental rule of law relating to the

implementation of the Treaty

In exercising its discretion pursuant to Article 24 of Regulation
4253/88, the Commission misdirected itself or was wrong in
law in failing to take account of the matters pleaded in the
application. The Commission approach is in breach of
the
inter alia, articles 23 and 24 of Regulation
provisions of
4253/88.

III. Failure to respect

the principles of non-retrospectivity,

legal certainty, and legitimate expectation

The retrospective application of standards for financial manage-
ment, and in particular the issue of eligibility criteria, that were

The Commission clearly had available alternatives to the deci-
sion adopted in this case. The approach adopted by the
Commission is out of all proportion to the result intended to
the
be achieved having regard to the ongoing efficacy of
projects in issue and the nature of
the project beneficiary.
Such an approach effectively amounts to the imposition of a
penalty in circumstances where there is no evidence of any
wrongdoing on the part of any undertaking or authority.

down provisions

(1) Council Regulation (EEC) No 4253/88 of 19 December 1988,
implementing Regulation (EEC)
laying
No 2052/88 as
the
different Structural Funds between themselves and with the opera-
tions of
the European Investment Bank and the other existing
financial instruments OJ L 374, 31.12.1988, p. 1-14.

regards coordination of

the activities of

for

Action brought on 24 June 2003 by the Commission of
the European Communities against Ireland

(Case C-274/03)

(2003/C 200/32)

An action against Ireland was brought before the Court of
Justice of the European Communities on 24 June 2003 by the
Commission of
the European Communities, represented by
Mr Georges Zavvos, acting as agent, with an address for service
in Luxembourg.

The Applicant claims that the Court should:

1)

declare that, by failing to adopt the laws, regulations and
administrative provisions necessary to comply with Direc-
tive 2000/26/EC of the European Parliament and of the
Council of 16 May 2000 on the approximation of the
laws of the Member States relating to insurance against
civil liability in respect of the use of motor vehicles and
amending Council Directives 73/239/EEC and 88/357/EEC
(Fourth motor insurance Directive), published in the Offi-
cial Journal L 181, 20.07.2000, p. 65-74, or in any event
by failing to communicate them to the Commission,
Ireland has failed to fulfil its obligations under the Direc-
tive;

23.8.2003

EN

Official Journal of the European Union

C 200/19

2)

order Ireland to pay the costs.

Pleas in law and main arguments

The period within which the directive had to be transposed
expired on 20 July 2002.

Appeal brought on 25 June 2003 by Scott SA against
the judgment delivered on 10 April 2003 by the Fifth
Chamber, Extended Composition, of the Court of First
Instance of the European Communities in case T-366/
supported by the French
00 between Scott SA,
the European
Republic,

and the Commission of

Communities

(Case C-276/03 P)

(2003/C 200/33)

An appeal against the judgment delivered on 10 April 2003
by the Fifth Chamber, Extended Composition, of the Court
the European Communities in case
Instance of
of First
T-366/00 between Scott SA,
supported by the French
Republic, and the Commission of the European Commu-
nities (1), was brought before the Court of
the
European Communities on 25 June 2003 by Scott SA,
represented by Sir
established in Saint-Cloud (France),
Jeremy Lever KCMG, QC, and G. Peretz, Barristers, and
A. Nourry and R. Griffith, Solicitors, with an address for
service in Luxembourg.

Justice of

The Appellant claims that the Court should:

— set aside the decision of the Court of First Instance
of
in so far as Scott's
the Commission infringed

dismissing
Article 2 of
application alleges
Article 15 of the Regulation;

application
the Decision (2)
that

annulment

Scott's

for

— annul Article 2 of

the Decision,

it
concerns the alleged aid granted in the form of a
land price referred to in Article 1 of the
preferential
Decision; and

in so far as

— order the Commission to pay the costs of this appeal,
including the costs incurred by Scott at first instance.

Pleas in law and main arguments

The Appellant submits that the judgment of the Court of
First Instance should be set aside on the following grounds:

The Court of First Instance was wrong to apply the newly
introduced provisions of Article 15 of Regulation 659/
99 (3)as if they were governed by the old case-law relating
to the conduct of administrative procedures.

— The Court of First Instance should have recognised that
the Regulation established a Community State aid
regime that is, in important and relevant respects, new.

— It also wrongly failed to give any, or any sufficient
weight to the fact that it is the recipient of aid that
particularly
cases where
Article 15 applies.

protection

requires

in

— The Court of First Instance should not have held that
the characterisation of the recipient of aid as merely an
‘information source’
the procedure
under Article 88(2) EC supported its conclusion.

in the course of

— The Court of First

Instance wrongly failed to take
account of the wording of Articles 14 and 15 which
indicates that Article 15 is concerned with the liability
of recipients of aid.

— The Court of First Instance wrongly failed to recognise
that the consequence of its interpretation of Article 15
was to frustrate the purpose of that Article, that is to
say, to provide legal certainty to recipients of aid.

The Court of First Instance was wrong to hold that the
absence of a ‘duty’ on the part of the Commission to ‘warn’
recipients of interrupting actions was relevant to the ques-
tion of whether an action of which the recipient had no
notice could interrupt the limitation period as against it.

The Court of First
Instance was wrong to hold that
Article 15 created a single limitation period that applied in
the same way to the Member State concerned and to ‘third
parties’; alternatively,
it was wrong to hold that such a
principle operated so as to exclude the application of the
limitation rule as sought by Scott.

The Court of First
Instance was wrong to regard it as
relevant to the application of Article 15 that Scott could
have had no legitimate expectation that the aid was lawfully
granted originally; the purpose of Article 15 is to provide
legal certainty where, ex hypothesi, the aid was not lawfully
granted.

The Court of First Instance wrongly disregarded the wording
of Article 15 and failed to address an important argument
addressed to it by Scott, summarised by the Court of First
Instance at paragraph 42 of the judgment.

The Court of First Instance was wrong to treat it as relevant
that there was no limitation rule in force on the expiry of
10 years from the grant of the aid to Scott.

(1) OJ C 61, 24.02.2001, p. 16.
(2) 2002/14/EC: Commission Decision of 12 July 2000 on the state
aid granted by France to Scott Paper SA Kimberly-Clark (Text with
(notified under document number C(2000) 2183)
EEA relevance)
(OJ L 12, 15.01.2002, p. 1).

(3) Council Regulation (EC) No 659/1999 of 22 March 1999 laying
down detailed rules for the application of Article 93 of the EC
Treaty (OJ L 83, 27.03.1999, p. 1).