CELEX: 62001CJ0261
Language: en
Date: 2003-10-21
Title: Judgment of the Court of 21 October 2003. # Belgische Staat v Eugène van Calster and Felix Cleeren (C-261/01) and Openbaar Slachthuis NV (C-262/01) # Reference for a preliminary ruling: Hof van Beroep te Antwerpen - Belgium. # Aid financed by parafiscal charges - Compulsory charges to finance a fund for animal health and livestock production - Retroactive effect of the charges - Validity of a Commission decision concerning State aid - Powers of the Commission. # Joined cases C-261/01 and C-262/01.

Joined Cases C-261/01 and C-262/01 Belgische StaatvEugene van Calster, Felix CleerenandOpenbaar Slachthuis NV(References for a preliminary rulingfrom the Hof van Beroep te Antwerpen)
         
            «(Aid financed by parafiscal charges – Compulsory charges to finance a fund for animal health and livestock production – Retroactive effect of the charges – Validity of a Commission decision concerning State aid – Powers of the Commission)»
            
               
                  Opinion of Advocate General Jacobs delivered on 10 April 2003 
                     
               I - 0000 
               
            
                   
               
               
            
               
                  Judgment of the Court, 21 October 2003  
                     
               I - 0000 
               
            
                   
               
               
            
            Summary of the Judgment
         
         
                  1..
                  State aid – Planned aid – Notification to the Commission – Extent of the obligation – Notification must include the method of financing an account of its impact on the permissibility of the aid  (EC Treaty, Art. 93(3) (now Art. 88(3)) 
         
                  2..
                  State aid – Planned aid – Prohibition of implementation before the Commission's final decision – Direct effect – Scope – Charges introduced to finance aid granted contrary to Community law – Obligation on national courts to order repayment  (EC Treaty, Art. 93(3) (now Art. 88(3) EC)) 
         
                  3..
                  State aid – Planned aid – Grant of aid in breach of the prohibition laid down in Article 93(3) of the Treaty (now Article 88(3) EC) – Subsequent Commission decision declaring the aid compatible with the common market – Effect – Ex post facto regularisation of the national legal measures relating to the grant of the aid – None   (EC Treaty, Art. 93(3) (now Art. 88(3) EC)) 
         
                  4..
                  State aid – Respective powers of the Commission and of national courts – No power of the Commission to order repayment of non-notified aid  (EC Treaty, Art. 92 (now, after amendment, Art. 87 EC) and Art. 93(3) (now Art. 88(3) EC)) 
         
         1.
          The method by which an aid is financed may render the entire aid scheme incompatible with the common market. Therefore, the
         aid cannot be considered separately from the effects of its method of financing and consideration of an aid measure by the
         Commission must necessarily also take into account the method of financing the aid in a case where that method forms an integral
         part of the measure. In such a case, the notification of the aid provided for in Article 93(3) of the Treaty must also cover the method of financing,
         so that the Commission may consider it on the basis of all the facts. If this requirement is not satisfied, it is possible
         that the Commission may declare that an aid measure is compatible, when, if the Commission had been aware of its method of
         financing, it could not have been so declared. Accordingly, in order to ensure the effectiveness of the obligation to notify and the Commission's full and appropriate consideration
         of an aid, the Member State is required, in order to comply with that obligation, to notify not only the planned aid in the
         narrow sense, but also the method of financing the aid inasmuch as that method is an integral part of the planned measure.
         see paras 49-51
         
         2.
          Where an aid measure of which the method of financing is an integral part has been implemented in breach of the obligation
         to notify, national courts must, as part of their task of upholding the rights of the persons concerned in the event of any
         breach by the national authorities of the prohibition laid down in the last sentence of Article 93(3) of the Treaty (now the
         last sentence of Article 88(3) EC) which has direct effect, take all the consequential measures under national law as regards
         both the validity of decisions giving effect to the aid measures concerned and the recovery of the financial support granted
         and thus in principle order reimbursement of charges or contributions levied specifically for the purpose of financing that
         aid. see paras 54, 64
         
         3.
          The Commission's final decision declaring aid incompatible with the common market does not have the effect of regularising
          
          ex post facto  implementing measures which were invalid, when taken, because they had been taken in breach of the prohibition laid down
         by the last sentence of Article 93(3) of the Treaty (now the last sentence of Article 88(3), since otherwise the direct effect
         of that prohibition would be impaired and the interests of individuals, which are to be protected by national courts, would
         be disregarded. Any other interpretation would have the effect of according a favourable outcome to the non-observance of
         the last sentence of that provision by the Member State concerned and would deprive it of its effectiveness see para. 63
         
         4.
          In supervising the Member States' compliance with their obligations under Article 92 (now, after amendment, Article 87 EC)
         and 93 of the Treaty, (now Article 88 EC) the national courts and the Commission fulfil complementary and separate roles.
         Whilst assessment of the compatibility of State aid with the common market falls within the exclusive competence of the Commission,
         subject to review by the Court, it is for the national courts to ensure that the rights of individuals are safeguarded where
         the obligation to give prior notification of State aids to the Commission pursuant to Article 93(3) of the Treaty is infringed.
         Unlike the national courts, the Commission cannot therefore order the return of a State aid on the sole ground that it was
         not notified in accordance with Article 93(3) of the Treaty  see paras 74-76
      

      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
            
            JUDGMENT OF THE COURT21 October 2003  (1)
         
         
            
         
               ((Aid financed by parafiscal charges – Compulsory charges to finance a fund for animal health and livestock production – Retroactive effect of the charges – Validity of a Commission decision concerning State aid – Powers of the Commission))
               
            In Joined Cases C-261/01 and C-262/01, 
            REFERENCE to the Court under Article 234 EC by the Hof van Beroep te Antwerpen (Belgium) for a preliminary ruling in the proceedings
            pending before that court between 
            
            
            
             Belgische Staat 
            
            
            and
            
             Eugene Van Calster,  Felix Cleeren  (C-261/01)and between Belgische Staat and  Openbaar Slachthuis NV  (C-262/01),
            
            
            on the interpretation of Community law, in particular of Article 93 of the EC Treaty (now Article 88 EC) and Article 173 of
            the EC Treaty (now, after amendment, Article 230 EC) and of the Commission Decision of 9 August 1996 relating to aid measure
            No N 366/96,
            
            THE COURT,,
            
            composed of: V. Skouris, President, P. Jann, C.W.A. Timmermans (Rapporteur), C. Gulmann, J.N. Cunha Rodrigues and A. Rosas (Presidents of Chambers), D.A.O. Edward, A. La Pergola, J.-P. Puissochet, R. Schintgen, F. Macken, N. Colneric and S. von Bahr, Judges, 
            
            Advocate General: F.G. Jacobs, Registrar: H. von Holstein, Deputy Registrar, 
            
            
            after considering the written observations submitted on behalf of:
               
               
               ─
               the Belgische Staat, by A. Snoecx, acting as Agent, assisted by B. van de Walle de Ghelcke, A. Vastersavendts and J. Wouters,
               avocats, 
               
               
               ─
               Messrs. Van Calster and Cleeren and Openbaar Slachthuis NV, by J. Arnauts-Smeets and J. Keustermans, avocats, 
               
               
               ─
               the Netherlands Government, by H.G. Sevenster, acting as Agent, 
               
               
               ─
               the Commission of the European Communities, by H.M.H. Speyart and D. Triantafyllou, acting as Agents, 
               
               
            
            
            having regard to the Report for the Hearing,
            
            after hearing the oral observations of the Belgische Staat, represented by B. van de Walle de Ghelcke and J. Wouters, Messrs.
               Van Calster and Cleeren, represented by J. Keustermans, Openbaar Slachthuis NV, represented by J. Arnauts-Smeets, and the
               Commission, represented by H. van Vliet, acting as Agent, at the hearing on 10 December 2002,
            
            
            after hearing the Opinion of the Advocate General at the sitting on 10 April 2003, 
         gives the following
         
         
         Judgment
         1
            
         By orders of 28 June 2001, received at the Court of Justice on 5 July 2001, the Hof van Beroep (Court of Appeal) te Antwerpen
         referred to the Court for a preliminary ruling under Article 234 EC several questions on the interpretation of Community law,
         in particular of Article 93 of the EC Treaty (now Article 88 EC) and Article 173 of the EC Treaty (now, after amendment, Article
         230 EC) and of the Commission Decision of 9 August 1996 relating to aid measure No N 366/96 (
         the 1996 Decision). 
         
         
         2
            
         Those questions were raised in proceedings between the Belgische Staat (
         the Belgian State) and, on the one hand, Messers Van Calster and Cleeren, cattle dealers, and, on the other, Openbaar Slachthuis NV (
         Openbaar Slachthuis), a slaughterhouse.  Messers Van Calster and Cleeren and Openbaar Slachthuis are seeking repayment by the Belgian State of
         charges which they have paid to the animal health and production fund (
         the 1987 Fund), on the ground that they were levied contrary to Community law. 
         
            
               Legal background
            National legislation
         
         
         3
            
         The Law of 24 March 1987 on animal health (
          Moniteur belge  of 17 April 1987, p. 5788,  
         the 1987 Law) establishes a system to finance services to combat animal diseases and improve animal hygiene and the health and quality
         of animals and animal products (
         the 1987 regime).  According to Article 2 of the 1987 Law, its purpose is  
         to combat animal disease in order to promote public health and the economic welfare of livestock farmers. 
         
         
         4
            
         Article 32(2) of the 1987 Law provides: [The 1987 Fund] shall be set up in the Ministry of Agriculture.  The purpose of the Fund shall be to contribute towards the
         financing of compensation, allowances and other benefits for combating animal disease and improving the hygiene, health and
         quality of animals and animal products.  The Fund shall be financed by:
         
         1.
          Compulsory contributions from natural and legal persons who raise, process, transport, handle, sell or trade in animals; 
         ... If the compulsory contribution is collected from persons who process, transport, handle, sell or trade in animals or animal
         products, it shall, on every transaction, be passed back up to the stage of the producer ...
         
         
         5
            
         The 1987 Law authorises the Crown to determine by Decree the amount of the compulsory charges and the rules for collecting
         them.  By Royal Decree of 11 December 1987 on the compulsory contributions to the animal health and production fund (
          Moniteur belge  of 23 December 1987, p. 19317,  
         the 1987 Decree), a charge of BEF 105 per head of calf, cattle or pig slaughtered or exported alive was levied on slaughterhouses and exporters
         with effect from 1 January 1988.  The 1987 Law and Decree were subsequently amended on several occasions.  None of those documents
         was notified to the Commission pursuant to Article 93(3) of the Treaty. 
         
         
         6
            
         Pursuant to the Law of 23 March 1998 on the establishment of a budgetary fund for the health and quality of animals and animal
         products (
          Moniteur belge  of 30 April 1998, p. 13469,  
         the 1998 Law), the 1987 regime and Fund were cancelled retroactively and replaced by a new scheme (
         the 1998 regime) containing a new system of compulsory charges that apply retroactively with effect from 1 January 1988 and by a new fund,
         the Budgetary fund for the health and quality of animals and animal products (
         the 1998 Fund).  The 1998 regime essentially differs from the 1987 regime in that it does not provide for a charge in respect of imported
         animals and the charges for exported animals are no longer due with effect from 1 January 1997. 
         
         
         7
            
         Article 5 of the 1998 Law provides that the 1998 Fund is to be financed, inter alia, by charges levied by the Crown on natural
         and legal persons who produce, process, transport, handle, sell or trade in animals or animal products. 
         
         
         8
            
         Article 14 of the 1998 Law levies charges on slaughterhouses and exporters.  The amounts of those charges differ according
         to the period over which they are owed. According to that article:  The following compulsory contributions to the fund shall be imposed on slaughterhouses and exporters:...Those compulsory contributions shall be passed on to the producer.They are owed only in respect of national animals.  They are not owed in respect of imported animals.  They cease to be owed
         in respect of exported animals with effect from 1 January 1997.With regard to imported animals, the compulsory contributions that were paid with effect from 1 January 1988 in application
         of the Royal Decree of 11 December 1987 on the compulsory contributions to the animal health and production fund, as amended
         by the Royal Decrees of 8 April 1989, 23 November 1990, 19 April 1993, 15 May 1995, 25 February 1996 and 13 March 1997, shall
         be repaid to persons who prove that the compulsory contributions paid by them related to imported animals, that those contributions
         were not passed on by them to the producer or that the passing on was annulled and that they have paid the contributions in
         full for the national animals, including the exported slaughtered animals and the exported stud and working animals.
         
         
         9
            
         Articles 15 and 16 of the 1998 Law impose charges on the persons responsible for the holdings in which pigs are kept and on
         the dairies or the holders of licences to sell dairy products. 
         
         
         10
            
         The second paragraph of Article 17 of the 1998 Law provides for automatic equalisation between amounts owed in respect of
         charges paid under the 1987 regime and charges due under the 1998 regime. 
         Procedure before the Commission
         
         
         11
            
         In accordance with the procedure provided for in Article 93(2) of the Treaty, the Commission, by Decision 91/538/EEC of 7
         May 1991 on the animal health and production fund in Belgium (OJ 1991 L 294, p. 43,  
         the 1991 Decision) found that the 1987 regime was incompatible with the common market within the meaning of Article 92 of the EC Treaty (now,
         after amendment, Article 87 EC) and could therefore not be implemented in so far as the compulsory charges were also imposed,
         at the stage of slaughter, on animals and products from other Member States. 
         
         
         12
            
         By letters of 7 December 1995 and 20 May 1996 the Kingdom of Belgium notified, in accordance with Article 93(3) of the Treaty,
         draft legislative measures for the abolition of the 1987 regime and its replacement by a new scheme. 
         
         
         13
            
         This draft provided in particular for a solution to the problem of the imposition of a charge on imported animals which had
         led the Commission, in its 1991 Decision, to declare the 1987 regime incompatible with the common market. 
         
         
         14
            
         The draft legislation, which was to become the 1998 Law, was declared compatible with the common market by the 1996 Decision.
         
         The main proceedings
         
         15
            
         Mr Van Calster and Mr Cleeren buy and sell cattle, some of which is exported. They have paid charges to the 1987 Fund on the
         basis of the 1987 Law and Decree.  Openbaar Slachthuis buys, slaughters and sells cattle and markets meat. It has also paid
         charges to the 1987 Fund.  In the disputes in the main proceedings Mr Van Calster, Mr Cleeren and Openbaar Slachthuis are
         seeking reimbursement of part of the charges on the ground that they were levied contrary to Community law. 
         
         
         16
            
         Those charges were levied both in respect of national animals and animal products and in respect of imported animals and animal
         products. 
         
         
         17
            
         Since the last sentence of Article 14 of the 1998 Law establishes a reimbursement scheme for charges levied on imported animals
         and animal products, the disputes in the main proceedings relate only to the charges levied on national animals or animal
         products. 
         
         
         18
            
         The decisions handed down by the national courts at first instance upheld the actions of Mr Van Calster and Mr Cleeren and
         of Openbaar Slachthuis.  However, the Belgian State has appealed against those decisions to the referring court. 
         
         
         19
            
         In answer to Mr Van Calster, Mr Cleeren and Openbaar Slachthuis, the Belgian State has relied on the second paragraph of Article
         17 of the 1998 Law.  It has submitted that, pursuant to that provision, sums owed in respect of the repayment of charges paid
         under the 1987 regime are offset against charges due retroactively under the 1998 regime. 
         
         
         20
            
         However, Mr Van Calster, Mr Cleeren and Openbaar Slachthuis argue that the 1998 Law cannot constitute the basis for a retroactive
         charge.  They rely, inter alia, on the argument that Community law precludes such a charge from being imposed retroactively.
         
         
         
         21
            
         The referring court observes that the Commission did not take the view, either in its 1991 Decision or when examining the
         1998 regime, that the charges levied on live exported animals up to 1 January 1997 were contrary to the Treaty. Furthermore,
         it states that the Commission declared in its 1996 Decision that it had no objection to the measures contained in the draft
         legislation that was to become the 1998 Law.  According to the referring court, the 1996 Decision implies that the rules imposing
         a charge on the export of animals up to 1 January 1997 were not contrary to Community law. 
         
         
         22
            
         As regards the export charges, the referring court observes that it is settled case-law that such charges cannot fall under
         the prohibition on charges having equivalent effect if they are applied in the same amount to the same products intended for
         the national market (see Joined Cases 36/80 and 71/80  
          Irish Creamery Milk Suppliers Association  [1981] ECR 735).  In the main proceedings the charges apply, according to that court, to the animals systematically and according
         to the same criteria, irrespective of whether they are intended for export or for slaughter. Furthermore, the referring court
         takes the view that the export charges in question in the main proceedings cannot fall within the sphere of application of
         Article 95 of the EC Treaty (now, after amendment, Article 90 EC), since the latter prohibits only discriminatory taxation
         which places imported products at a disadvantage. 
         
         
         23
            
         Moreover, in the referring court's view, the Treaty does not preclude the Belgian State, notwithstanding its obligation to
         make full reimbursement of the charges unlawfully levied, from providing for a new scheme of aid measures which can be implemented
         after their notification to and approval by the Commission.  However, according to that court, this raises the question whether
         the Treaty precludes the new State aid scheme from having retroactive effect in such a way that charges are levied on transactions
         which took place several years before such notification. 
         
         
         24
            
         The referring court takes the view that, as the Commission approved the aid provided for in the 1998 regime, it also decided
         that the method of financing that aid, namely the levying of a charge in favour of the 1998 Fund, is compatible with the common
         market. 
         
         
         25
            
         However, it observes that Mr Van Calster, Mr Cleeren and Openbaar Slachthuis have disputed the Commission's competence in
         that regard. 
         
         
         26
            
         The referring court points out that under Article 173 of the Treaty only the Court of Justice has competence to review the
         legality of the acts adopted by the Commission.  It observes that it is common ground in the main proceedings that Mr Van
         Calster, Mr Cleeren and Openbaar Slachthuis are directly and individually concerned by the 1996 Decision.  It states that
         it is necessary, nevertheless, to consider whether the Commission's decision is to be regarded as an authorisation granted
         to the Member State concerned and whether, therefore, those parties to the main proceedings are directly and individually
         concerned by the decision of the Member State implementing that authorisation, but not by an act of the Commission.  It considers
         that the answer to that question determines the admissibility of the claim that the Commission lacked competence. 
         The questions referred for a preliminary ruling
         
         27
            
         In those circumstances, the referring court, taking the view that the outcome of the disputes pending before it requires an
         interpretation of certain Community rules, decided to stay proceedings and to refer several questions to the Court for a preliminary
         ruling. 
         
         
         28
            
         The questions referred in the two cases in the main proceedings are worded identically and are in the same order, except that
         the order for reference in Case C-262/01 contains a second question which is not put in Case C-261/01.  The Hof van Beroep
         te Antwerpen has asked the following questions in Case C-262/01: 
         
         1.
          In the circumstances outlined above is a system of aid measures compatible with Community law, in particular with Article
         93(3) of the EC Treaty ... , which, after its notification, is considered by the Commission on 30 July 1996 to be compatible
         with the common market and under which the Member State imposes in the general interest, with retroactive effect, contributions
         or charges: 
         
         
         ─
         to finance an animal health and production fund, 
         
         
         
         ─
         on natural and legal persons whose characteristics are set out in Articles 14, 15 and 16 of the ... Law of 23 March 1998,
         as amended by the Arbitragehof in its judgment of 9 February 2000 in Cases Nos 1414, 1450, 1452, 1453, and 1454, 
         
         
         
         ─
         because of the activities described in those articles which took place in the period from 1988 until 21 May 1996 in which
         those aid measures had not yet been approved? 
         
         
         
         2.
          Has the Commission, by approving the aid measures established by the Law of 23 March 1998, also approved the retroactive effect
         of that law? 
         
         
         3.
          Is the Commission Decision of 30 July 1996 merely in the nature of an individual authorisation to a Member State to implement
         the planned aid measures? 
         
         
         4.
          Are the persons owing the contributions directly and individually concerned by the Commission's act within the meaning of
         Article 173 of the EC Treaty ...? 
         
         
         5.
          If the answer to question 4 is in the negative, does Article 230 EC then permit the persons owing the contributions, as the
         beneficiaries of the aid, to raise a plea of lack of competence with regard to the Commission's act whereby authorisation
         was given to implement the aid measures from which they benefit? 
         
         
         6.
          If it is accepted that the [applicants], as persons owing the contributions and/or as beneficiaries of the aid, are directly
         and individually concerned by the Commission's decision and may therefore lawfully raise a plea of lack of competence, has
         the Commission exceeded the limits of its competence in adopting its decision of 30 July 1996 and infringed Article 93(3)
         of the EC Treaty ...?
         
         
         
         29
            
         By order of the President of the Court of 4 October 2001, Cases C-261/01 and C-262/01 were joined for the purposes of the
         written and oral procedures and of judgment. 
         The first question in Cases C-261/01 and C-262/01
         
         30
            
         By its first question in Cases C-261/01 and C-262/01 the national court is asking essentially whether Article 93(3) of the
         Treaty must be interpreted as precluding, in circumstances such as those in the main proceedings, the levying of charges which
         finance an aid scheme that has been declared compatible with the common market by a Commission decision, where those charges
         are imposed retroactively. 
         Observations submitted to the Court
         
         
         31
            
         As a preliminary point, the Belgian State submits that the facts of the case giving rise to the judgment in Case C-354/90
          
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon  [1991] ECR I-5505 are fundamentally different from those of the cases in the main proceedings.  That judgment concerns cases
         in which the national authorities have implemented aid measures without previously notifying them to the Commission or without
         awaiting the Commission's final decision, contrary to the last sentence of Article 93(3) of the Treaty.  However, the cases
         in the main proceedings relate to an aid measure which was correctly notified to the Commission and in respect of which the
         Commission decided not to raise any objection. 
         
         
         32
            
         First of all, the 1998 Law is in conformity with the draft measures evaluated by the Commission in the 1996 Decision.  Consequently,
         there is no longer any incompatibility between the aid measures in question in the main proceedings and the common market.
          Moreover, the Commission has already expressly taken the view in the 1991 Decision that  
         the aid is compatible [with Community law] as regards both its form and its objectives.  Only the part of the financing of the 1987 Fund by parafiscal charges that were also levied on imported Community products
         raised a problem of Community law.  The Belgian State does not dispute that the 1991 Decision could not have the effect of
         annulling the irregularity of the non-notified aid, as is clear from the judgment in  
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon .  However, the cases in the main proceedings relate to another point, namely the effect of the 1996 Decision, which was adopted
         after notification of a new, lawful scheme. 
         
         
         33
            
         Next, the Belgian State submits that, in providing for the retroactive effect only of the compulsory contributions which were
         held, in the Commission's 1991 Decision, not to pose any problem, the Belgian legislature in no way intended to remedy past
         procedural defects.  On the contrary, it sought to ensure the quality and continuity of the operation of the 1987 Fund in
         the general interest, in particular in the interest of public health, and in total harmony with the objectives and principles
         of the common agricultural policy. 
         
         
         34
            
         Furthermore, the Belgian State submits that the Court ought to take account of Article 90(2) of the EC Treaty (now Article
         86(2) EC).  It is evident that the 1987 Fund, and then the 1998 Fund, were entrusted with tasks of general economic interest
         within the meaning of that provision.  The Belgian State does not submit that retroactive measures which seek to ensure that
         entities such as the 1987 Fund and the 1998 Fund can perform their tasks of general interest are exempt from the notification
         obligation laid down in Article 93(3) of the Treaty.  On the other hand, it submits that Article 90(2) of the Treaty plays
         an important role when the Commission takes account of the provision of services of general economic interest in the course
         of its assessment whether, and to what extent, a scheme such as that established by the 1998 Law may partially have retroactive
         effect. 
         
         
         35
            
         Lastly, the Belgian State maintains that the retroactive effect of the 1998 Law in respect of the compulsory contributions
         scheme corresponds, in any event, to a general interest ground and that, without such an effect, the foundations of the scheme
         underlying the operation and the financial and economic equilibrium of the 1998 Fund would be shaken. 
         
         
         36
            
         Mr Van Calster, Mr Cleeren and Openbaar Slachthuis contend that, pursuant to the second paragraph of Article 5 of the EC Treaty
         (now the second paragraph of Article 10 EC), the national court is required, in the exercise of its powers, to ensure the
         full effect of Community law and to protect the rights which it confers on individuals.  In the present case, the national
         court must therefore ensure the direct effect of Article 93(3) of the Treaty. 
         
         
         37
            
         Referring to the Opinion of Advocate General Tesauro in Case C-17/91  
          Lornoy and Others  [1992] ECR I-6523, they submit that it is impossible to make a distinction between the charges and the aid measures, because,
         first, the charges constitute the means by which those measures may have a beneficial effect and, second, they may disturb
         the market.  Consequently, Article 93(3) of the Treaty applies in the cases in the main proceedings, both to the charges and
         to the aid measures. 
         
         
         38
            
         Moreover, they conclude from paragraphs 15 and 17 of  
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon  that even if the Commission decides that aid is compatible with the common market, the effect of its decision is not to regularise
         the charges which have been wrongfully levied.  The Commission and the national court are given two separate tasks in that
         regard. 
         
         
         39
            
         Mr Van Calster, Mr Cleeren and Openbaar Slachthuis submit, moreover, that the rule, which aims to prevent Member States from
         being induced to infringe Article 93(3) of the Treaty and which follows from the same judgment, applies equally to aid with
         retroactive effect, that is to say, to aid which a Member State wishes to grant in respect of a period which has already expired
         when the aid was notified. That rule applies  
          a fortiori  to retroactive measures whose object and effect are to prevent the reimbursement of charges that have been unlawfully levied.
          In such a case, the prohibition of putting aid into effect, laid down in Article 93(3) of the Treaty, would be circumvented
         by the attribution of retroactive effect to the planned measures.  If such a manoeuvre were regarded as permissible, that
         article would be a dead letter.  It would suffice to reintroduce, retroactively, the charges unlawfully levied or the aid
         unlawfully granted. 
         
         
         40
            
         The Netherlands Government submits that there is no link between the retroactive effect of the charges in question in the
         main proceedings and the prohibition, in Article 93(3) of the Treaty, on the putting into effect of planned measures.  The
         cases in the main proceedings do not relate to the putting into effect by a Member State of aid contrary to the prohibition
         in that provision.  The legal basis for the charges is to be found in the 1998 Law, which was notified to the Commission at
         the draft stage and entered into force only after approval by it. 
         
         
         41
            
         Moreover, the Netherlands Government observes that the national court appears to base its questions on an assumption that
         in decisions relating to State aid the Commission must always rule separately on the temporal effect of the charges imposed.
          The Netherlands Government submits that is, however, not the case.  The Commission will do so only if the retroactive effect
         of the charges constitutes an infringement of the Treaty.  Where the Commission has not ruled to that effect, the aid measure,
         including the mechanism for the charges and any retroactive effect, should be considered to be compatible with the common
         market. 
         
         
         42
            
         The Commission submits that it is common ground that the 1998 regime was notified to it in accordance with Article 93(3) of
         the Treaty and that it was declared compatible with the common market by the 1996 Decision.  It points out that the decision
         states that the Commission  
         has noted that the system of compulsory charges on slaughterhouses will no longer provide for a charge on imported or exported
         animals. 
         
         
         43
            
         The Commission observes that, inasmuch as it applies to the period after 9 August 1996, the 1998 regime was properly notified
         and is therefore lawful.  On the other hand, the Commission submits that the application of that scheme to the period prior
         to that date amounts in reality to the grant of aid that has not been approved by the Commission and infringes Article 93(3)
         of the Treaty.  The contrary conclusion would allow a Member State, by means of retroactive legislation, to render ineffective
         the prohibition on the implementation of unapproved State aid. 
         Reply of the Court
         
         
         44
            
         In order to reply to the first question, it is necessary first to determine whether the obligation to notify State aid pursuant
         to Article 93(3) of the Treaty, and the consequences of a failure to comply with that obligation, apply also to the method
         of financing such aid.  That question is posed in relation to an aid measure which provides for a scheme of charges that forms
         an integral part of that measure and is intended specifically and exclusively to finance it. 
         
         
         45
            
         Under Article 93 of the Treaty the Commission has sole competence, subject to review by the Court of Justice, to assess the
         compatibility with the common market of a State aid measure. 
         
         
         46
            
         The Court has already held that Article 92 of the Treaty does not allow the Commission to isolate the aid as such from the
         method by which it is financed and to disregard this method if, in conjunction with the aid in its narrow sense, it renders
         the whole incompatible with the common market (Case 47/69  
          France  v  
          Commission  [1970] ECR 487, paragraph 4). 
         
         
         47
            
         Even though the method of financing satisfies the other requirements of the Treaty, and in particular those flowing from Article
         95, that does not mean that the measure in question is valid in relation to Articles 92 and 93 of the Treaty (see, to that
         effect,  
          France  v  
          Commission , paragraph 13).  It may be that aid in the narrow sense does not substantially affect trade between Member States and may
         thus be acknowledged as permissible but that the disturbance which it creates is increased by a method of financing it which
         would render the scheme as a whole incompatible with a single market and the common interest (see  
          France  v  
          Commission , paragraph 16). 
         
         
         48
            
         Furthermore, where a charge specifically intended to finance aid proves to be contrary to other provisions of the Treaty,
         for example Articles 9 and 12 of the EC Treaty (now, after amendment, Articles 23 EC and 25 EC) or to Article 95 of the Treaty,
         the Commission cannot declare the aid scheme of which the charge forms part to be compatible with the common market (see,
         to that effect, Case 73/79  
          Commission  v  
          Italy  [1980] ECR 1533, paragraph 11). 
         
         
         49
            
         Consequently, the method by which an aid is financed may render the entire aid scheme incompatible with the common market.
          Therefore, the aid cannot be considered separately from the effects of its method of financing (
          France  v  
          Commission , paragraph 8).  Quite to the contrary, consideration of an aid measure by the Commission must necessarily also take into
         account the method of financing the aid in a case where that method forms an integral part of the measure. 
         
         
         50
            
         In such a case, the notification of the aid provided for in Article 93(3) of the Treaty must also cover the method of financing,
         so that the Commission may consider it on the basis of all the facts.  If this requirement is not satisfied, it is possible
         that the Commission may declare that an aid measure is compatible, when, if the Commission had been aware of its method of
         financing, it could not have been so declared. 
         
         
         51
            
         Accordingly, in order to ensure the effectiveness of the obligation to notify and the Commission's full and appropriate consideration
         of an aid, the Member State is required, in order to comply with that obligation, to notify not only the planned aid in the
         narrow sense, but also the method of financing the aid inasmuch as that method is an integral part of the planned measure.
         
         
         
         52
            
         Since the obligation to notify also covers the method of financing the aid, the consequences of a failure by the national
         authorities to comply with the last sentence of Article 93(3) of the Treaty must apply also to that aspect of the aid. 
         
         
         53
            
         In that regard it must be observed, first, that it is for the national courts to uphold the rights of the persons concerned
         in the event of a possible breach by national authorities of the prohibition of putting aid into effect, to which the last
         sentence of Article 93(3) of the Treaty refers and which has direct effect (
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon , paragraph 12, and  
          Lornoy and Others , paragraph 30) and, second, that the Member State is in principle required to repay charges levied in breach of Community
         law (Joined Cases C-192/95 to C-218/95
          Comateb and Others  [1997] ECR I-165, paragraph 20). 
         
         
         54
            
         It follows that where an aid measure of which the method of financing is an integral part has been implemented in breach of
         the obligation to notify, national courts must in principle order reimbursement of charges or contributions levied specifically
         for the purpose of financing that aid. 
         
         
         55
            
         In the present case, the charges levied under Articles 14, 15 and 16 of the 1998 Law finance the 1998 Fund.  Those charges
         are therefore levied specifically and solely for the purpose of financing the aid at issue in the main proceedings. 
         
         
         56
            
         The 1998 Law was notified to the Commission and declared compatible with the common market by the 1996 Decision.  Inasmuch
         as they relate to the period commencing on the exact date of that decision, 9 August 1996, both the aid in the narrow sense
         and the charges imposed in order to finance it are therefore lawful. 
         
         
         57
            
         However, the 1998 Law imposes charges with effect retroactively to 1 January 1988. Part of the charges provided for by the
         1998 Law is therefore imposed in respect of a period which predates the 1996 Decision. 
         
         
         58
            
         Accordingly, inasmuch as the 1998 Law imposes charges with retroactive effect in regard to the period from 1 January 1988
         to 8 August 1996, it is illegal owing to the failure to observe the requirement for notification prior to putting the aid
         scheme into effect.  Those charges are therefore levied in breach of the last sentence of Article 93(3) of the Treaty. 
         
         
         59
            
         Furthermore, the 1998 Law abolished the 1987 Law, which had not been notified to the Commission, and replaced the scheme of
         aid and charges established by the 1987 Law by a new, essentially identical, scheme with retroactive effect to 1 January 1988,
         the date of entry into force of the 1987 Law.  As the Advocate General has observed in paragraph 14 of his Opinion, the aim
         of the Belgian legislature was thereby to remedy the consequences of the breach of the obligation to make prior notification
         of the aid established by the 1987 Law. 
         
         
         60
            
         That legislative method cannot be considered compatible with the obligation to notify under Article 93(3) of the Treaty. 
         If it were upheld, the Member States could immediately put a plan for State aid into effect without notifying it to the Commission
         and the consequences of a failure to notify could be avoided by abolishing the measure and reintroducing it simultaneously
         with retroactive effect. 
         
         
         61
            
         That conclusion cannot be invalidated by the Belgian State's argument based on Article 90(2) of the Treaty.  Even if that
         provision could apply to the 1998 Fund, it must be observed that, as the Belgian State itself accepted, the 1998 Law ought
         in any event to have been notified in accordance with Article 93(3) of the Treaty (see Case C-332/98  
          France  v  
          Commission  [2000] ECR I-4833, paragraphs 31 to 33).  That law too was necessarily subject to the prohibition on implementation under
         Article 93(3). 
         
         
         62
            
         Moreover, the illegality of an aid measure, or of part of that measure, owing to infringement of the obligation to notify
         prior to its implementation is not affected by the fact that the measure has been held to be compatible with the common market
         by a final decision of the Commission. 
         
         
         63
            
         The Court has already held that the Commission's final decision does not have the effect of regularising  
          ex post facto  implementing measures which were invalid because they had been taken in breach of the prohibition laid down by the last sentence
         of Article 93(3) of the Treaty, since otherwise the direct effect of that prohibition would be impaired and the interests
         of individuals, which are to be protected by national courts, would be disregarded.  Any other interpretation would have the
         effect of according a favourable outcome to the non-observance of that provision by the Member State concerned and would deprive
         it of its effectiveness (see  
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon , paragraph 12, and  
          Lornoy and Others , paragraph 16). 
         
         
         64
            
         Furthermore, it is for the national courts to uphold the rights of the persons concerned in the event of any breach by the
         national authorities of the prohibition on putting aid into effect, which is referred to in the last sentence of Article 93(3)
         of the Treaty and has direct effect.  Where such a breach is invoked by individuals entitled to rely on it and is established
         by the national courts, the latter must take all the consequential measures under national law as regards both the validity
         of decisions giving effect to the aid measures concerned and the recovery of the financial support granted (see  
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon , paragraph 12, and  
          Lornoy and Others , paragraph 30). 
         
         
         65
            
         Having regard to the foregoing, the answer to the first question in Cases C-261/01 and C-262/01 must be that Article 93(3)
         of the EC Treaty must be interpreted as precluding, in circumstances such as those in the main proceedings, the levying of
         charges which finance specifically an aid scheme that has been declared compatible with the common market by a Commission
         decision, in so far as those charges are imposed retroactively in respect of a period prior to the date of that decision.
         
         The second question in Case C-262/01
         
         66
            
         By its second question in Case C-262/01 the national court asks essentially whether the 1996 Decision must be interpreted
         as approving the retroactive effect of the 1998 Law. 
         Observations submitted to the Court
         
         
         67
            
         The Belgian State submits that this question must be answered in the affirmative. The entire text of the draft which was to
         become the 1998 Law was sent to the Commission.  The 1998 regime presented difficulties solely as regards the compatibility
         with the common market of the method of financing that regime.  The provisions relating to the charges imposed under that
         draft legislation therefore inevitably received the full attention of the Commission, also as regards their temporal effect.
          Moreover, the Commission carried out a detailed analysis of that draft, as is shown by its requests for additional information.
         
         
         
         68
            
         The Belgian State therefore concludes that the Commission, following its in-depth examination of that draft and in particular
         Article 14 thereof, was undoubtedly aware of the fact that Article 14 imposed compulsory charges for the benefit of the 1998
         Fund with effect from 1 January 1988.  By not raising any objection to the entirety of the measures notified, it approved
         that provision. 
         
         
         69
            
         Mr Van Calster, Mr Cleeren and Openbaar Slachthuis submit that the 1998 Law had the object and effect of establishing retroactive
         charges.  Furthermore, they submit that it is in no way apparent from the wording of the 1996 Decision that the Commission
         approved the retroactive implementation of aid measures.  It merely stated that the aid measures established for the future
         by the 1998 Law were compatible with the common market.  That implies that, to the extent that the 1998 Law imposes retroactive
         charges, it is illegal.  That law was implemented with effect from 1988, that is to say eight years before the Commission
         adopted the 1996 Decision.  The infringement of Article 93(3) of the Treaty thus committed by the Belgian authorities was
         therefore in no way covered or approved by the 1996 Decision. 
         
         
         70
            
         In any event, Mr Van Calster, Mr Cleeren and Openbaar Slachthuis submit that the Commission is not competent to rule on the
         legality of measures put into effect before its decision or to restore the legality of such measures.  Consequently, if the
         Court were to hold that the 1996 Decision does in fact approve the putting into effect of the measures provided for by the
         1998 Law before the adoption of that decision, it would be necessary to find that the decision is invalid. 
         
         
         71
            
         The Commission contends that the 1996 Decision does not address the retroactive aspect of the 1998 regime.  Unlike the national
         court, the Commission does not draw any substantive inferences from the legality of an aid scheme. 
         Reply of the Court
         
         
         72
            
         It must be observed, first of all, that the 1996 Decision does not refer to the fact that the 1998 Law imposes charges with
         retroactive effect. 
         
         
         73
            
         In any event, even if the Commission did examine the compatibility with the common market of the charges imposed with retroactive
         effect, it does not have competence to decide that an aid scheme put into effect contrary to Article 93(3) of the Treaty is
         legal. 
         
         
         74
            
         In supervising the Member States' compliance with their obligations under Articles 92 and 93 of the Treaty, the national courts
         and the Commission fulfil complementary and separate roles (Case C-39/94  
          SFEI and Others  [1996] ECR I-3547, paragraph 41). 
         
         
         75
            
         Whilst assessment of the compatibility of aid measures with the common market falls within the exclusive competence of the
         Commission, subject to review by the Court, it is for the national courts to ensure that the rights of individuals are safeguarded
         where the obligation to give prior notification of State aids to the Commission pursuant to Article 93(3) of the Treaty is
         infringed (Case C-295/97  
          Piaggio  [1999] ECR I-3735, paragraph 31). 
         
         
         76
            
         Unlike the national courts, the Commission cannot therefore order the return of a State aid on the sole ground that it was
         not notified in accordance with Article 93(3) of the Treaty (see  
          Fédération nationale du commerce extérieur des produits alimentaires et Syndicat national des négociants et transformateurs
            de saumon , paragraph 13, and  
          SFEI and Others , paragraph 43). 
         
         
         77
            
         It follows from the foregoing that the answer to the second question in Case C-262/01 is that the 1996 Decision does not approve
         the retroactive effect of the 1998 Law. 
         The second to fifth questions in Case C-261/01 and the third to sixth questions in Case C-262/01
         
         78
            
         It is apparent from the orders for reference that the Hof van Beroep te Antwerpen referred the second to fifth questions in
         Case C-261/01 and the third to sixth questions in Case C-262/01 only in the event that the Court were to conclude that the
         Commission, by the 1996 Decision, approved the retroactive effect of the 1998 Law. 
         
         
         79
            
         Having regard to the fact that the Court has reached the contrary conclusion in its reply to the second question in Case C-262/01,
         it is unnecessary to reply to those questions. 
         
         Costs
         80
            
         The costs incurred by the Netherlands Government and by the Commission, which have submitted observations to the Court, are
         not recoverable.  Since these proceedings are, for the parties to the main proceedings, a step in the actions pending before
         the national court, the decision on costs is a matter for that court. 
         
         On those grounds, 
         
         
         
            
            THE COURT,
         
         
         in answer to the questions referred to it by the Hof van Beroep te Antwerpen by orders of 28 June 2001, hereby rules: 
         
            
            1.
             Article 93(3) of the EC Treaty (now Article 88(3) EC) must be interpreted as precluding, in circumstances such as those in
            the main proceedings, the levying of charges which finance specifically an aid scheme that has been declared compatible with
            the common market by a Commission decision, in so far as those charges are imposed retroactively in respect of a period prior
            to the date of that decision. 
            
            
            2
               
            The Commission Decision of 9 August 1996 relating to aid measure No N 366/96 does not approve the retroactive effect of the
            Law of 23 March 1998 on the establishment of a budgetary fund for the health and quality of animals and animal products. 
            
            
                  Skouris
               
               
                  Jann 
               
               
                  Timmermans 
               
            
                  Gulmann
               
               
                  Cunha Rodrigues 
               
               
                  Rosas 
               
            
                  Edward
               
               
                  La Pergola 
               
               
                  Puissochet 
               
            
                  Schintgen
               
               
                  Macken 
               
               
                  Colneric 
               
            
                  von Bahr
               
               
                  
               
               
                  
               
            
            
            
            
            
            
            
            
         
         
         Delivered in open court in Luxembourg on 21 October 2003. 
         
         
         
         
                  R. Grass 
               
               
                  V. Skouris  
               
            
         
         
         
                  Registrar
               
               
                  President
               
            
      
      
          1 –
            
             Language of the case: Dutch.