Case T-150/20: Action brought on 24 March 2020 — Tartu Agro v Commission
Date: 2020-03-24
Institutions: General Court
Subjects: Southern Estonia, State aid, control of State aid, farm lease, farm rent, market prices, principle of legal certainty, property leasing, reimbursement of aid








C_2020175EN.01003001.xml










25.5.2020   


EN


Official Journal of the European Union


C 175/30






Action brought on 24 March 2020 — Tartu Agro v Commission
(Case T-150/20)
(2020/C 175/41)
Language of the case: Estonian

Parties


Applicant: AS Tartu Agro (represented by: T. Järviste, T. Kaurov, M. Peetsalu and M. A. R. Valberg, lawyers)

Defendant: European Commission

Form of order sought

The applicant claims that the Court should:






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declare the application admissible;










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annul the decision of the Commission of 24 January 2020 on state aid SA.39182 (2017/C), which concerns the grant of alleged illegal aid to Tartu Agro;










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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 eight pleas in law.






1.


First plea in law, alleging that the application is admissible.






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The application is admissible since, according to the contested decision, the applicant is an alleged recipient of state aid. Therefore, that decision concerns it directly and individually.














2.


Second plea in law, alleging that the Commission fundamentally infringed substantive and procedural rules when it assessed whether the transaction was in line with market conditions on the basis of the tender procedure, failed to meet the burden of proof and erred in its interpretation of the facts.






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The Commission ought to have taken into consideration the temporal context of the time of conclusion of the lease contract, the economic considerations at the time and the standards of interpretation applicable at that time.










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The Commission erred in its conclusion that the tender procedure failed to meet the requirements which guarantee the respect of market conditions, since the terms of the tender procedure on the whole had ensured the maximisation of the State’s profit.














3.


Third plea in law, alleging that the Commission fundamentally infringed substantive and procedural rules when it ascertained whether the rate agreed in the lease contract was in line with market conditions, infringed the rules governing the burden of proof in its assessment of the existence of state aid and erred in its interpretation of the facts.






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The Commission established the existence of state aid based on irrelevant and incomplete data. It ought to have established that the investments in land improvement, the costs for land maintenance and the improvement in the quality of the soil were included in the lease in full.










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The Commission erred when it failed to take into account that the alleged economic advantage resulting from the lease contract was in any event eliminated in 2002 at the latest with the privatisation and the merger of the applicant and the owner of its shares.














4.


Fourth plea in law, alleging that the Commission fundamentally infringed legal provisions in its determination of the amount of the advantage and erred in its assessment of the facts.






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The Commission erred in its use of arithmetic means and statistical lease rates in the assessment and breached its obligation to state reasons.














5.


Fifth plea in law, alleging that the Commission fundamentally infringed legal provisions and erred in its assessment of the facts when it categorised the facts as new aid.






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Any allegedly granted aid was granted prior to Estonia’s accession to the European Union and had completely terminated at the time of the accession, whereas the undertaking was privatised in 2001 and the applicant merged with the owner of its shares in 2002.














6.


The Commission fundamentally infringed legal provisions and erred in its interpretation of the facts when it considered the aid to be obsolete only in part.






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The Commission ought to have concluded that the state aid allegedly resulting from the lease contract had terminated in 2002 at the latest with the merger of the applicant and the owner of its shares and is therefore obsolete in full.














7.


Seventh plea in law, alleging that the Commission infringed legal provisions when it imposed on the Republic of Estonia the obligation to recover the aid, contrary to the principles of legitimate expectations and legal certainty.






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There are special circumstances to the effect that recovery from the applicant would be highly inequitable, as the applicant was not obliged to recognise the existence of state aid.














8.


Eighth plea in law, alleging that the Commission fundamentally infringed legal provisions and erred in its interpretation of the facts when it categorised the aid as being incompatible with the internal market.






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The parties demonstrated in substance how the lease contract contributed to the promotion of economic development; however, the Commission failed to address that matter as to its substance.