Case C-13/24 P: Appeal brought on 9 January 2024 by AFG, SA (Zona Franca da Madeira) against the order of the General Court (Fifth Chamber) delivered on 27 October 2023 in Case T-722/22 AFG v Commission (Zona Franca da Madeira)
Date: 2024-01-09
Institutions: Court of Justice
Subjects: Madeira, Portugal, State aid, control of State aid, corporation tax, principle of legal certainty, principle of proportionality, regional aid, reimbursement of aid, tax relief








C_202403147EN.000101.fmx.xml












Official Journal of the European Union


EN
C series













C/2024/3147


21.5.2024






Appeal brought on 9 January 2024 by AFG, SA (Zona Franca da Madeira) against the order of the General Court (Fifth Chamber) delivered on 27 October 2023 in Case T-722/22 AFG v Commission (Zona Franca da Madeira)


(Case C-13/24 P)

(C/2024/3147)
Language of the case: Portuguese

Parties


Appellant: AFG, SA (Zona Franca da Madeira) (represented by: S. Estima Martins, F. Castro Guedes, and M. Ellison, advogados

Other party to the proceedings: European Commission

Form of order sought

The appellant claims that the Court of Justice should:






—


set aside the order of the General Court (Fifth Chamber) of 27 October 2023 in Case T-722/22, AFG, S.A. (Zona Franca da Madeira) v Commission, which dismissed the appellant’s action seeking annulment of Articles 1, 4, 5 and, 6 of European Commission Decision C(2020) 8550 final (1) of 4 December 2020 on aid scheme SA.21259 (2018/C) (ex 2018/NN) implemented by Portugal for Zona Franca da Madeira (ZFM) [Madeira Free Zone, MFZ] – Regime III;










—


order the European Commission to pay the costs of the proceedings in their entirety.





Grounds of appeal and main arguments

1.   Error of law relating to the adoption of the order under appeal pursuant to Article 126 of the Rules of Procedure

The General Court erred in law by adopting the order under appeal pursuant to Article 126 of the Rules of Procedure, in a case in which the parties are not the same and in which the elements of fact and law relied upon by the applicants in support of the various pleas alleging unlawfulness are also different.
2.   Error of law relating to the application of Article 107(1) TFEU, since the aid is not selective

The MFZ scheme is a general scheme and forms part of the logic and general economy of the tax system of the Autonomous Region of Madeira (ARM), and therefore does not entail a selective advantage for the companies registered in that zone and, consequently, does not constitute State aid. The General Court erred in law by finding that the aid scheme in question was selective.
3.   Error of law relating to the interpretation of the criterion relating to the origin of the profits resulting from activities effectively and materially performed in Madeira, laid down in the Commission Decisions of 2007 and 2013

The General Court erred in the interpretation of the expression ‘activities effectively and materially performed in Madeira’, inasmuch as its interpretation conflicts with the logic and competitive dynamic of companies in open global markets; disregards the case-law of the Court of Justice on the ‘main centre of interests’; and precludes costs incurred by activities performed outside the ARM from being regarded as additional costs borne.
4.   Error of law relating to the interpretation of the criterion relating to job creation/maintenance in the ARM, laid down in the Commission Decisions of 2007 and 2013

The General Court erred when it held that tests such as the FTE (Full-Time Equivalent) and ALU (Annual Labour Units) methods should be used, for the purposes of verifying whether the Regime III criterion relating to job creation/maintenance in the ARM is satisfied, instead of the concept of ‘job’ under the national legislation.
5.   Error of law relating to the application of general principles of EU law

The General Court, in the order under appeal, infringed the general principles of EU law, specifically the principles of legal certainty, the protection of legitimate expectations and proportionality.


(1)  
            OJ 2022 L 217, p. 49.


ELI: http://data.europa.eu/eli/C/2024/3147/oj
ISSN 1977-091X (electronic edition)