CELEX: C2000/273/11
Language: en
Date: 2000-09-23 00:00:00
Title: Case C-277/00: Action brought on 11 July 2000 by the Federal Republic of Germany against the Commission of the European Communities

23.9.2000              EN                   Official Journal of the European Communities                                       C 273/7
2.    Does the term ‘solely’, used in Note 1(b) to CN Chapter               ‘recipients’. They could not therefore be aware, on the
      90 and in Note 2(b) to CN Chapters 61 and 62 allow the                basis of the decision of 5 August 1997 opening the
      elasticity of the material to be regarded as the sole                 inquiry procedure, that they would one day be regarded
      relevant criterion even if the supportive function is                 in a Commission decision as ‘recipients’ of aid which
      strengthened by other factors (in this case the insert)?              certainly never flowed to them directly.
3.    If Question 2 is answered in the affirmative:
      Is General Rule A.3(b) in the General rules for the
      interpretation of the combined nomenclature suitable for
      determining the question when the supportive function            Compatibility with the common market of
      of the other factors, not made of elastic material, is           the aid granted to System Microelectronic
      predominant, or what other criteria should be used to            Innovation GmbH i.GV (SMI) and Silicium
      determine the question?                                          Microelectronic Integration GmbH (SiMI)
                                                                       —    Breach of essential procedural requirements (errors in
                                                                            ascertaining the facts, defective statement of reasons):
                                                                            findings that Synergy Semiconductor Corporation (Syn-
                                                                            ergy) was to take over, and did take over, management
Action brought on 11 July 2000 by the Federal Republic                      and control of Halbleiterelektronik Frankfurt/Oder GmbH
of Germany against the Commission of the European                           (HEG), later renamed SMI, cannot be found at all in the
                          Communities                                       contested decision, since the Commission incorrectly
                                                                            assumed that the acquisition of 49 % of the shares
                        (Case C-277/00)                                     excluded acquisition of control.
                        (2000/C 273/11)
                                                                            The Commission failed to find that the loan by the Land
An action against the Commission of the European Communi-                   of Brandenburg to SMI is based on the privatisation
ties was brought before the Court of Justice of the European                agreement and is to be regarded as part of the consider-
Communities on 11 July 2000 by the Federal Republic of                      ation from the public authorities on the occasion of
Germany, represented by Wolf-Dieter Plessing, Ministerialrat in             privatisation.
the Federal Ministry of Financial Affairs, 108 Graurheindorfer
Straße, D-53117 Bonn, and Dr Michael Schütte, Rechtsanwalt,
of Bruckhaus Westrick Heller Löber, 99-101 Rue de la Loi,
B-1040 Brussels.                                                            The decision is also vitiated by considerable defects in the
                                                                            reasoning. In particular there are no reasons at all for the
The applicant claims that the Court should:                                 Commission’s failure to take account of the statutory
                                                                            exception in Article 87(2)(c) EC. There are no findings
1.    Annul Commission Decision C(2000) 1063 fin. of                        whatever as regards the effects of possible aid on the
      11 April 2000 on aid to System Microelectronic Inno-                  relevant market. The Commission incorrectly assumes
      vation GmbH of Frankfurt an der Oder;                                 only that there is a ‘semiconductor market’. However,
                                                                            SMI operated only in a very restricted market for
2.    Order the Commission to pay the costs.                                customer-specific and application-specific circuits.
Pleas in law and main arguments
                                                                       —    Breach of Article 87(1) EC: the decision infringes substan-
                                                                            tive law, in so far as it declares the financial measures
Procedural errors                                                           of the Treuhandanstalt and its successor BvS to be
                                                                            incompatible with the common market. The Commission
—     Breach of the principle of the right to a hearing and of              incorrectly considered that the Treuhand scheme, that is,
      the procedural rule in Article 88(2) EC in so far as the              an existing aid scheme, did not apply to the payments by
      Federal Republic of Germany is required to recover aid of             the Treuhandanstalt of DEM 64,8 million, because it
      DEM 140.1 million also from Silicium Microelectronic                  obviously made a wrong assessment of the privatisation.
      Integration GmbH (SiMI), Microelectronic Design and                   In fact Synergy, by acquiring its holding in SMI, took over
      Development GmbH (MD&D) and other unnamed under-                      management of the undertaking and comprehensive
      takings: at no time was an inquiry procedure carried out              rights of control over the company. In addition, the
      against aid in favour of those undertakings. The inquiry              agreements also include all the other elements of a typical
      procedure which led up to the contested decision was at               privatisation agreement, such as a jobs guarantee, know-
      no time extended by the Commission to the other                       how transfer, surplus earnings transfer, excess profit
      undertakings described in the contested decision as                   transfer and an environmental contamination clause.
 ---pagebreak--- C 273/8              EN                    Official Journal of the European Communities                                       23.9.2000
    The loan by the Land of Brandenburg of DEM 70,3                   —    Breach of the principle of legal certainty: the decision is
    million cannot be treated differently from corresponding               not definite enough, in that it claims aid back from every
    payments by the Treuhandanstalt. Provision of DEM 35                   undertaking ‘to which the assets of ... (SMI), ... (SiMI) or ...
    million finance by the Land of Brandenburg was promised                (MD&D) have been or will be transferred in a form
    as part of the privatisation agreement. That measure in                intended to evade the consequences of the decision’.
    the framework of privatisation is justified under the
    Treuhand scheme because the promise was a component
    and a condition of the privatisation agreement and it
    cannot matter which State source payments which were              Breach of the principle of proportionality.
    permitted under the Treuhand scheme were actually
    made from. After taking over the shares from the
    Treuhandanstalt, the Land of Brandenburg gave a further
    DEM 35,3 million as a loan. That constituted a contract
    management measure on the part of the Land of Branden-
    burg, which was permitted in accordance with the
    Treuhand scheme, and in any event capable of being
    approved. The Commission did not, however, examine
    the compatibility of the loan against that background.
Recovery of the aid                                                   Reference for a preliminary ruling from the Bundesver-
                                                                      waltungsgericht by order of that court of 6 April 2000 in
                                                                      the case of Altmark Trans GmbH and Regierungspräsidi-
—   Lack of competence of the Commission and exceeding its            um Magdeburg v Nahverkehrsgesellschaft Altmark
    powers: the order to recover the aid from third parties           GmbH, interested party: Oberbundesanwalt beim Bun-
    who did not receive the aid and had no opportunity to                                  desverwaltungsgericht
    take part in the procedure constitutes exceeding of its
    powers by the Commission. The Commission has no
    jurisdiction to issue such an order (lack of competence of                                  (Case C-280/00)
    the Commission, second paragraph of Article 230 EC).
    Under Article 88 EC the Member State has exclusive
    competence to recover aid, and the Commission does not                                      (2000/C 273/12)
    have jurisdiction under Article 5(2) EC.
                                                                      Reference has been made to the Court of Justice of the
    The Commission furthermore by the contested decision              European Communities by an order of the Bundesverwaltungs-
    intervenes impermissibly in the legal order of the Member         gericht (Federal Administrative Court) of 6 April 2000, which
    State, since the instruction to make recovery from                was received at the Court Registry on 14 July 2000, for a
    third parties disapplies the provisions of the judicially         preliminary ruling in the case of Altmark Trans GmbH and
    supervised insolvency procedure.                                  Regierungspräsidium Magdeburg v Nahverkehrsgesellschaft
                                                                      Altmark GmbH, interested party: Oberbundesanwalt beim
                                                                      Bundesverwaltungsgericht, on the following question:
    The decision is also unlawful because the Commission
    does not state what specific conduct or what specific
    measures could constitute circumvention of the claim
    for recovery and restricts itself instead to groundless           Do Articles 73 EC and 87 EC, read in conjunction with
    suppositions, allegations and fears. The Commission also          Regulation (EEC) No 1191/69, (1) as amended by Regulation
    misunderstands the nature of the German insolvency                (EEC) No 1893/91, (2) preclude the application of a national
    procedure, which on the basis of judicial control does not        provision which permits licences to operate regular local
    allow unlawful actions to take place without sanctions in         public transport services to be awarded in respect of services
    national law. In the present case the assumption that the         completely dependent on public grants without regard being
    insolvency administrator carried out the movements of             had to Sections II, III and IV of the abovementioned regulation?
    assets alleged by the Commission (and thereby not only
    incurred personal liability but possibly even committed a
    criminal offence) is not tenable.
                                                                      (1) OJ, English Special Edition 1969 (I), p. 276.
                                                                      (2) OJ No L 169 of 29.6.1991, p. 1.
—   Unlawful extension of the character of recipient on the
    ground of alleged evasion of the recovery of the aid: the
    contested decision also infringes Article 87(1) EC, since
    there was no benefit to the undertakings not involved in
    the procedure, not even indirectly by means of any
    misapplication of aid.