CELEX: C2002/118/42
Language: en
Date: 2002-05-18 00:00:00
Title: Case T-27/02: Action brought on 4 February 2002 by Kronofrance S.A. against the Commission of the European Communities

C 118/26               EN                    Official Journal of the European Communities                                       18.5.2002
—     award the applicant the sum of 247 893,52 euros                   Pleas in law and main arguments
      (representing the sum of LUF 1 000 000) by way of
      compensation for the non-material damage suffered as a
      result of the lateness in drawing up his staff reports for        The applicant manufactures, inter alia, particle boards and
      the periods from 1 July 1993 to 30 June 1995 and from             oriented strand boards. It is contesting the Commission’s
      1 July 1995 to 30 June 1997;                                      decision, published in OJ C 333 of 28 November 2001, not to
                                                                        raise any objections to the grant to Glunz AG of Aid
—     rule on the costs, expenses and fees which the defendant          No N 517/2000. That aid concerns a non-repayable advance
      should be ordered to pay.                                         of EUR 46201868 and an investment allowance of
                                                                        EUR 23596120 for the construction of an integrated wood
                                                                        processing plant at Nettgau in the Land of Sachsen-Anhalt,
                                                                        Federal Republic of Germany.
Pleas in law and main arguments
                                                                        The applicant asserts as follows:
The applicant claims that he has suffered non-material damage           The Commission did not adhere strictly to the guidelines/
on account of a breach of the principle of sound administration         framework rules. Rather than involving application of the
and failure to act in good faith and to fulfil the duty of              multisectoral framework on regional aid, the matter arguably
cooperation as regards the drawing up of his consecutive staff          constitutes restructuring aid. The Commission wrongly con-
reports. In addition, according to the applicant, those faults          sidered, when applying the multisectoral Community frame-
have been repeated time and again and show that the                     work for the purposes of determining the competitive factor,
Commission does not bother to comply with the rules.                    that particle boards and oriented strand boards formed part of
                                                                        a single relevant market, instead of assessing the markets for
                                                                        those products separately. The annual growth rates were
                                                                        incorrectly assessed; the product market in question is posi-
                                                                        tively shrinking. Consequently, the competitive factor accord-
                                                                        ing to Point 3.10 of the multisectoral framework is not 1.00
                                                                        but 0.25. The particle board market is experiencing a ruinous
                                                                        price war. That price war is being intensified to an intolerable
                                                                        degree by the further subsidisation of new production plants.
Action brought on 4 February 2002 by Kronofrance S.A.
  against the Commission of the European Communities                    The Commission disregarded the discretion vested in it and
                                                                        incorrectly assumed, when approving the aid, that it had no
                                                                        latitude in the matter. That failure to exercise its discretion
                         (Case T-27/02)                                 constitutes an error of assessment.
                                                                        Even if it is assumed that, from a formal standpoint, the
                        (2002/C 118/42)                                 Commission correctly applied the multisectoral framework on
                                                                        regional aid, it must be doubted whether that framework is
                                                                        compatible with Article 87 EC.
                  (Language of the case: German)
                                                                        By failing to initiate the formal examination procedure,
                                                                        despite considerable difficulties in reviewing the aid and an
                                                                        investigation lasting nearly 12 months, the Commission has
An action against the Commission of the European Communi-               infringed both Regulation No 659/1999 and Article 88(2) EC,
ties was brought before the Court of First Instance of the              thereby breaching an essential procedural requirement and
European Communities on 4 February 2002 by Kronofrance                  substantive law.
S.A., of Sully sur Loire (France), represented by R. Nierer,
lawyer.
                                                                        The fact that no formal examination procedure was initiated
                                                                        has unlawfully prevented the applicant and the Member States
                                                                        from taking part in such a procedure. This is contrary to the
The applicant claims that the Court should:                             applicant’s rights of defence and restrictive of its right to a fair
                                                                        hearing.
—     annul the Commission’s decision of 25 July 2001 not to
      raise any objections to the grant of aid by the Federal           The contested decision is not supported by an adequate
      Republic of Germany to Glunz AG;                                  statement of reasons.
—     order the Commission to bear its own costs and to pay
      the costs of the applicant.