Case T-107/14: Action brought on 14 February 2014 — Hellenic Republic v Commission
Date: 2014-02-14
Institutions: General Court
Subjects: EAFRD, EAGF, EU financing, Greece, fodder-growing, legal basis, principle of legal certainty, principle of proportionality, single payment scheme








C_2014129EN.01003102.xml










28.4.2014   


EN


Official Journal of the European Union


C 129/31






Action brought on 14 February 2014 — Hellenic Republic v Commission
(Case T-107/14)
(2014/C 129/39)
Language of the case: Greek

Parties


Applicant: Hellenic Republic (represented by: I. Khalkias, E. Leftheriotou, and A. Vasilopoulou)

Defendant: European Commission

Form of order sought

The applicant claims that the General Court should:






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annul the Commission Implementing Decision of 12 December 2013 on excluding from European Union financing certain expenditure incurred by the Member States under the Guarantee Section of the European Agricultural Guidance and Guarantee Fund (EAGGF), under the European Agricultural Guarantee Fund (EAGF) and under the European Agricultural Fund for Rural Development (EAFRD), notified under document C(2013) 8743 and published OJ 2013 L 338 to the extent of the sections of it whereby there is excluded, from European Union financing, expenditure (a) to a total amount of EUR 78 813 783,87 , which was incurred by the Hellenic Republic in the area of the single payment scheme for the financial years 2008-2010 and (b) to a total amount of EUR 22 230 822,10 which was incurred by the Hellenic Republic in the area of cross compliance for the financial years 2006-2010;










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order the Commission to pay the costs.





Pleas in law and main arguments

In support of the action, the applicant relies on the following pleas in law:






1.


In respect of the correction which is imposed by the contested decision in the framework of the single payment scheme of Regulation No 1782/2003 (1) (payment entitlements):






 


First plea in law:






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Lack of legal basis for the imposition of corrections in relation to the calculation of the single payment entitlements and the allocation of the national reserve and misinterpretation and misapplication of Articles 42 and 43 of Regulation No 1782/2003, Article 21 and Article 28(1) and (2) of Regulation No 795/2004 (2) and Article 31 of Regulation No 1290/2005, (3) and










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Unlawful imposition of flat-rate corrections in the framework of the single payment scheme, since there is no valid legal basis for the application of the old guidelines in Document VI/5530/1997 to the new CAP and to the single payment scheme, further, the application of the old guidelines to the new CAP constitutes a misuse of the powers of the ΕU in the area of financial corrections and at the same time is a serious infringement of the principle of proportionality.














 


Second plea in law, relating to the non-inclusion of all the forage areas in the calculation of the reference amounts:






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Contrary to the principles of legal certainty and proportionality and exceeding the bounds of its discretion, the Commission proposes a 5% flat-rate correction, though it should have proposed no correction, or should have limited it to an amount of 2%.














 


Third plea in law, relating to the non-inclusion of all the forage areas in the calculation of the reference amounts:






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Infringement of Article 4 of Regulation No 2529/2001, resulting in an incorrect basis for the calculation of the proposed flat-rate correction, which ought to be limited to the amount of EUR 162 920 267,28 for the year 2007, EUR 162 528 761,38 for the year 2008 and EUR 161 343 586,94 for the year 2009.














 


Fourth plea in law, in relation to the allocation of the national reserve:






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Misinterpretation of the provisions of Article 42 of Regulation No 1782/03 and Article 21 of Regulation No 795/2004 (criteria for the allocation of the national reserve) and erroneous assessment of the facts.














 


Fifth plea in law, in relation to the allocation of the national reserve:






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Absence of the required conditions for the application of Regulation No 1290/2005, since the Commission’s findings in relation to the national criteria for the allocation of the national reserve do not constitute infringements of it, and·










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Misinterpretation and misapplication of Article 31 of Regulation No 1290/2005 and of the guidelines in Document VΙ/553O/1997, since (a) the criticisms which the Commission relies on in relation to the criteria for the allocation of the national reserve even if assumed to be correct did not lead to the payment of sums to persons not entitled and did not create the risk of loss for the EAGF and (b) the criticisms in question are not linked to the failure to apply a key control and therefore do not justify the imposition of a flat-rate correction of 10%.


















2.


With regard to the correction imposed by the contested decisions in the area of cross compliance:






 


Sixth plea in law:






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The Commission’s Document AGRI-2005-64043 issued on 9 June 2006 cannot constitute a legal basis for the imposition of a financial correction. In any event it cannot be applied retrospectively for the imposition of a correction for the 2006 claim year.














 


Seventh plea in law, specifically in respect of the 2008 claim year:






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The financial corrections have been imposed contrary to the procedure laid down in Article 11 of Regulation No 885/2006 and Article 31 of Regulation No 1290/2005, and·










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In any event the Commission erred as to the facts and provided insufficient reasons in coming to the conclusion that there were weaknesses in the basic control system in the area of cross compliance.














 


Eighth plea in law: misapplication of Document AGRI-2005-64043:






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The Commission exceeded the bounds of its discretion when it decided on the imposition of corrections of a disproportionate amount in respect of the identified irregularities, to the extent that a correction of 5% is imposed for the years 2006 and 2007, and·










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Error in the determination of the basis of calculation of the correction imposed.














(1)  Council Regulation (EC) No 1782/2003 of 29 September 2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers and amending Regulations (EEC) No 2019/93, (EC) No 1452/2001, (EC) No 1453/2001, (EC) No 1454/2001, (EC) 1868/94, (EC) No 1251/1999, (EC) No 1254/1999, (EC) No 1673/2000, (EEC) No 2358/71 and (EC) No 2529/2001 (OJ 2003 L 270, p. 1).

(2)  Commission Regulation (EC) No 795/2004 of 21 April 2004 laying down detailed rules for the implementation of the single payment scheme provided for in Council Regulation (EC) No 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers (OJ 2004 L 141, p. 1).

(3)  Council Regulation (EC) No 1290/2005 of 21 June 2005 on the financing of the common agricultural policy (OJ 2005 L 209, p. 1).