Case T-205/16: Action brought on 4 May 2016 — Republic of Lithuania v European Commission
Date: 2016-05-04
Institutions: General Court
Subjects: Cohesion Fund, EU aid, VAT, co-financing, eligibility criteria, expenditure, project evaluation








C_2016251EN.01003401.xml










11.7.2016   


EN


Official Journal of the European Union


C 251/34





Action brought on 4 May 2016 — Republic of Lithuania v European Commission

(Case T-205/16)
(2016/C 251/40)
Language of the case: Lithuanian

Parties


Applicant: Republic of Lithuania, represented by D. Kriaučiūnas, R. Krasuckaitė and D. Stepanienė

Defendant: European Commission

Form of order sought

The applicant claims that the Court should:






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annul Commission Decision No C(2016)969 final of 23 February 2016 concerning the reduction in support from the Cohesion Fund for the project carried out in Lithuania and entitled ‘Technical assistance for Cohesion Fund management in the Republic of Lithuania’ (2005LT16CPA001) to the extent that it provides for a reduction in support in the amount of EUR 137 864,61;










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order the European Commission to pay the costs.





Pleas in law and main arguments

In support of the action, the Republic of Lithuania relies on a ground which relates to an infringement of Article 11 of Commission Regulation No 16/2003, (1) in conjunction with the principle of legitimate expectations, inasmuch as the European Commission, in deciding to reduce the support from the 2000-2006 EU Cohesion Fund:






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failed to take into account the fact that the VAT costs incurred as a result of implementing Commission Decision No C(2005)5291 (2) approving the project ‘Technical assistance for Cohesion Fund management in the Republic of Lithuania’ (‘the project’) were eligible for reimbursement in accordance with the requirements of Article 11(1) of Regulation No 16/2003 and other requirements;










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wrongly interpreted Article 11(3) of Regulation No 16/2003 as being applicable to the project because, regardless of the question whether the VAT costs must be reimbursed, such an interpretation is inconsistent with Article 11(1) of Regulation No 16/2003 and lacks legal logic and practical applicability in connection with the financing of Cohesion Fund projects;










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failed to consider Article 3(2) of Commission Decision No C(2005)5291, which provides that, pursuant to Article 7(4) of Regulation No 1164/94, (3) Community assistance was prescribed for 100 % of the project value (that is to say, no contribution by the person carrying out the project was envisaged) and the Member State could reasonably expect that the project would be financed in full by funds from the Cohesion Fund, that is to say, that all of the rules laid down by Regulation No 16/2003 would be applied in a proper manner.






(1)  Commission Regulation (EC) No 16/2003 of 6 January 2003 laying down special detailed rules for implementing Council Regulation (EC) No 1164/94 as regards eligibility of expenditure in the context of measures part-financed by the Cohesion Fund (OJ 2003 L 2, p. 7).

(2)  Commission Decision No C(2005) 5291 of 8 December 2005 concerning the grant of assistance from the Cohesion Fund for the project concerning Technical Assistance for Cohesion Fund Management in the Republic of Lithuania governing CCI 2005/LT/16/C/PA/001, as amended by Commission Decision No C(2008) 1566 of 15 April 2008 and Commission Decision No C(2011) 3668 of 20 May 2011.

(3)  Council Regulation (EC) No 1164/94 of 16 May 1994 establishing a Cohesion Fund (OJ 1994 L 130, p. 1), repealed by Council Regulation (EC) No 1084/2006 of 11 July 2006 establishing a Cohesion Fund and repealing Regulation (EC) No 1164/94 (OJ 2006 L 210, p. 79).