Case C-465/10: Judgment of the Court (Fourth Chamber) of 21 December 2011 (reference for a preliminary ruling from the Conseil d’État — France) — Ministre de l’Intérieur, de l’Outre-mer, des Collectivités territoriales et de l’Immigration v Chambre de commerce et d’industrie de l’Indre (Reference for a preliminary ruling — Protection of the European Union’s financial interests — Regulation (EC, Euratom) No 2988/95 — Article 3 — Structural Funds — Regulation (EEC) No 2052/88 — Regulation (EEC) No 4253/88 — Contracting authority in receipt of a subsidy from the Structural Funds — Failure to comply with public procurement rules by the recipient of an ERDF subsidy — Basis for the obligation to recover European Union subsidies in the case of an irregularity — Concept of ‘irregularity’ — Concept of ‘continuous irregularity’ — Conditions for recovery — Limitation period — Longer national limitation periods — Principle of proportionality)
Date: 2011-12-21
Institutions: Court of Justice
Subjects: European Regional Development Fund, France, State aid, award of contract, eligibility criteria, fraud against the EU, offence








C_2012049EN.01001001.xml










18.2.2012   


EN


Official Journal of the European Union


C 49/10





Judgment of the Court (Fourth Chamber) of 21 December 2011 (reference for a preliminary ruling from the Conseil d’État — France) — Ministre de l’Intérieur, de l’Outre-mer, des Collectivités territoriales et de l’Immigration v Chambre de commerce et d’industrie de l’Indre
(Case C-465/10) (1)

(Reference for a preliminary ruling - Protection of the European Union’s financial interests - Regulation (EC, Euratom) No 2988/95 - Article 3 - Structural Funds - Regulation (EEC) No 2052/88 - Regulation (EEC) No 4253/88 - Contracting authority in receipt of a subsidy from the Structural Funds - Failure to comply with public procurement rules by the recipient of an ERDF subsidy - Basis for the obligation to recover European Union subsidies in the case of an irregularity - Concept of ‘irregularity’ - Concept of ‘continuous irregularity’ - Conditions for recovery - Limitation period - Longer national limitation periods - Principle of proportionality)
2012/C 49/15
Language of the case: French

Referring court

Conseil d’État

Parties to the main proceedings


Appellant: Ministre de l’Intérieur, de l’Outre-mer, des Collectivités territoriales et de l’Immigration

Respondent: Chambre de commerce et d’industrie de l’Indre

Re:

Reference for a preliminary ruling — Conseil d'État (France) — Interpretation of the provisions of Council Regulation (EEC) No 2052/88 of 24 June 1988 on the tasks of the Structural Funds and their effectiveness and on coordination of their activities between themselves and with the operations of the European Investment Bank and the other existing financial instruments (OJ 1988 L 185, p. 9), Council Regulation (EEC) No 4253/88 of 19 December 1988, laying down provisions for implementing Regulation (EEC) No 2052/88 (OJ 1988 L 374, p.1) and Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests (OJ 1995 L 312, p. 1) — Failure by a recipient of subsidies paid under the ERDF and the FNADT to observe public procurement rules — Basis of the obligation to recover Community aid in cases of irregularity — Conditions for recovery of aid wrongly paid — Limitation period

Operative part of the judgment







1.


In circumstances such as those at issue in the case in the main proceedings, the third indent of Article 23(1) of Council Regulation (EEC) No 4253/88 of 19 December 1998 laying down provisions for implementing Regulation (EEC) No 2052/88 as regards coordination of the activities of the different Structural Funds between themselves and with the operations of the European Investment Bank and the other existing financial instruments, as amended by Council Regulation (EEC) No 2082/93 of 20 July 1993, read in conjunction with Article 7(1) of Council Regulation (EEC) No 2052/88 of 24 June 1988 on the tasks of the Structural Funds and their effectiveness and on coordination of their activities between themselves and with the operations of the European Investment Bank and the other existing financial instruments, as amended by Council Regulation (EEC) No 2081/93 of 20 July 1993, constitutes a legal basis enabling national authorities to recover from the recipient — without there being any need for authority to do so under national law — the whole of a subsidy granted from the European Regional Development Fund (ERDF) on the ground that, in its capacity as ‘contracting authority’, within the meaning of Council Directive 92/50/EEC of 18 June 1992 relating to the coordination of procedures for the award of public service contracts, as amended by Council Directive 93/36/EEC of 14 June 1993, the recipient has not complied with the requirements of that directive so far as concerns the award of a public service contract whose purpose was the implementation of the operation for which the recipient was granted the subsidy.










2.


The failure, by a contracting authority that receives an ERDF subsidy, to comply with the public procurement rules laid down by Directive 92/50 when awarding the contract whose purpose is to implement the subsidised operation constitutes an ‘irregularity’, within the meaning of Article 1 of Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities’ financial interests, even if the competent national authority could not have been unaware, when the subsidy was granted, that the recipient had already decided which provider it would entrust with the implementation of the subsidised operation.










3.


In circumstances such as those at issue in the main proceedings, where, in its capacity as contracting authority, the recipient of an ERDF subsidy has not complied with the public procurement rules of Directive 92/50 when awarding the contract whose purpose is to implement the subsidised operation:






—


the irregularity in question must be considered to be a ‘continuous irregularity’, within the meaning of the second subparagraph of Article 3(1) of Regulation No 2988/95, and, consequently, the limitation period of four years laid down by that provision to recover the subsidy wrongly paid to the recipient begins to run from the day on which the performance of the unlawfully awarded public contract is completed;










—


the transmission to the recipient of the subsidy of an audit report finding there to have been a failure to comply with the public procurement rules and recommending, as a result, that the national authority demand repayment of the sums paid constitutes a sufficiently specific act relating to investigation or legal proceedings concerning the ‘irregularity’, within the meaning of the third subparagraph of Article 3(1) of Regulation No 2988/95.














4.


Where the Member States exercise the right afforded them by Article 3(3) of Regulation No 2988/95, the principle of proportionality precludes application of a 30-year limitation period to the recovery of an advantage wrongly obtained from the European Union budget.






(1)  OJ C 346, 18.12.2010.