CELEX: C1996/077/12
Language: en
Date: 1996-03-16 00:00:00
Title: Action brought on 5 January 1996 by the Commission of the European Communities against the Kingdom of the Netherlands (Case C-3/96)

No C 77/6               EN                Official Journal of the European Communities                                        16 . 3 . 96
The applicant claims that the Court should :                               intended to be set off subsequently, in the course of the
                                                                           sale of the NMH shares to Max Aicher, against the
1 . declare void the Commission's decision of 18 October                   planned loss compensation by the State of Bavaria . Since
    1995 concerning a State aid by the Federal State of                    the privatization of the NMH shares provided for in
    Bavaria     to    the  EGKS-Stahlunternehmen           Neue            accordance with the contracts between the State of
    Maxhiitte Stahlwerke GmbH, Sulzbach-Rosenberg —                        Bavaria and Aicher is economically plausible, the grant
    K ( 95 ) 2828 final; and                                               of the disputed loans to NMH is also economically
                                                                           sensible . The waiver by the State of Bavaria of the loan in
2 . order the defendant to pay the costs .                                 the amount of DM 48 895 million was ultimately an
                                                                           integral part of the measures to privatize NMH .
Pleas in law and main arguments:                                           Logically, the loan transactions between the State of
                                                                           Bavaria and NMH cannot be characterized as aid, if the
— Breach of essential procedural requirements ( obligation                 assumption of losses by the State of Bavaria upon the
    under Article 15 of the ECSC Treaty to state the reasons               privatization of its NMH shares is unobjectionable
    on which a decision is based ):                                        under State aids law .
    — overall basis of the decision is the fact that the                   The Commission also breaches Article 83 of the ECSC
        shareholder loans made by the Federal State of                     Treaty, if from the outset it denies the State of Bavaria
        Bavaria are alleged to be in the nature of capital                 the right to sell a loss-making subsidiary and to assume
        replacements,                                                      part of its losses when so doing. That provision
                                                                           guarantees the right of public authorities to take part in
    — sweeping assertion that repayment could not be, and                  economic life and prohibits discrimination against the
        was not, expected to be made,                                      economic activity of public undertakings .
    — blanket refusal to refrain from adopting the                   — Breach of the principle of good faith : The Commission
        contested decision on the ground that it would                     should have delayed the contested decision until it had
        anticipate the outcome of Cases C-158/95 (') and                   been established whether the plan for the privatization
        T-129/95 ( 2 ).                                                    of the shares held by the State of Bavaria was permissible
                                                                           under Community law ( pending Cases C-158/95 and
— Incorrect application of Articles 4 (c ) and 83 of the                   T-129/95 ).
    ECSC Treaty: The loans granted by the State of Bavaria
    are not to be classified as aids, but as an act of a             (M OJ No C 362 , 1995 , p . 57 .
    shareholder which a private investor in a comparable             ( 2 ) OJ No C 229 , 1995 , p . 21 .
    situation would also reasonably have performed. The
    fact that there was and is a real prospect of the loan being
    repaid is shown by the fact that the productive situation
    of the company has stabilized and profits can be
    expected in the future . Although the State of Bavaria
    nevertheless subsequently decided not to demand                  Action brought on 5 January 1996 by the Commission of
    repayment of the loan, that was exclusively in order to          the European Communities against the Kingdom of the
    set it off, upon the sale of its shares, against the loss                                      Netherlands
    compensation by the State of Bavaria provided for in the                                     ( Case C-3/96
    privatization agreements. The set-off of the loans upon
                                                                                                   ( 96/C 77/ 12 )
    the sale of the shares was wholly appropriate and
    reasonable in economic terms, because it enabled the
    State of Bavaria to reorganize its policy towards                An action against the Kingdom of the Netherlands was
    combines and to protect its entrepreneurial image .              brought before the Court of Justice of the European
                                                                     Communities on 5 January 1996 by the Commission of the
    In any event, having regard to the principle of                  European Communities, represented by W. Wils, of its Legal
    proportionality, the Commission should not have                  Service, acting as Agent, with an address for service in
    claimed that the loan be repaid, but only that it be             Luxembourg at the office of C. Gomez de la Cruz, of its
    modified in such a way as to require repayment                   Legal Service, Wagner Centre, Kirchberg.
    irrespective of whether profits were expected.
                                                                     The Commission claims that the Court should :
    The Commission wrongly compares the conduct of the
    State of Bavaria with that of the private, minority               1 . declare that, by not designating sufficient special
    shareholders in assuming that the latter find themselves                protection areas within the meaning of Article 4 ( 1 ) of
    in a comparable situation . Their financial possibilities,              Council Directive 79/409/EEC of 2 April 1979 on the
    interests and entrepreneurial aims were, however,                       conservation of wild birds, the Kingdom of the
    different; in particular, they had no influence over the                Netherlands has failed to fulfil its obligations under that
    future business orientation of the Maxhiitte group. The                 Directive and under Articles 5 and 1 89 of the EC Treaty;
    loans granted by the State of Bavaria were in any event                 and
    sensible in entrepreneurial terms, because they were
    intended to enable the privatization of Neue Maxhiitte            2 . order the Kingdom of the Netherlands to pay the
    ( NMH ). The claims arising out of the loans granted were               costs .
 ---pagebreak--- 16 . 3 . 96             EN                    Official Journal of the European Communities                                          No C 111
Pleas in law and main arguments:                                         The applicant claims that the Court should :
It is clear from Article 4 ( 1 ) of Directive 79/409/EEC that the        1 . declare that, by failing to adopt and bring into force or,
designation of special protection areas is the primary means                   in the alternative, to notify within the prescribed period
whereby the Member States must ( seek to ) ensure the                          the laws, regulations or administrative provisions
survival and reproduction of the bird species mentioned in                     necessary to comply with Council Directive
Annex I thereto . The fact that in a Member State some                         90/658/EEC (') of 4 December 1990, in particular
populations of such species are declining justifies the                        Article 8 thereof, and those necessary to comply with
suspicion that the Member State has not complied with its                      Directive 93/16/EEC ( 2 ) of 5 April 1993 , in particular
obligation to achieve the appropriate result. In fact, in the                  Articles 3 and 9(3 ) and ( 4 ) thereof, which correspond to
Netherlands, populations of nine of the bird species                           Articles 3 and 9 ( a ) ( 1 ) and ( 2 ) respectively of Directive
mentioned in Annex I have fallen by over 50% .                                 75/362/EEC ( 3 ) as amended by Article 1 of Directive
                                                                               90/568/EEC, the Kingdom of Spain has failed to fulfil its
Under the last subparagraph of Article 4(1 ), Member States                    obligations under Articles 5 and 189 of the Treaty
must classify the most suitable territories in number and size                 establishing the European Community .
as special protection areas . With a view to a coherent general
system of special protection areas, the Commission had                   2 . order the defendant to pay the costs .
scientific surveys carried out by the Secretariat de la flore et
de la faune of the Musee national d'histoire naturelle in                Pleas in law and main arguments:
Paris, which drew up an inventory of habitats which should
be classified, on ornithological criteria , as special protection        The mandatory nature of the third paragraph of Article 189
areas; that list was updated in 1989 and 1994 by the                     and the first paragraph of Article 5 of the EC Treaty requires
International Council for Bird Preservation ('Inventory of               Member States to adopt the measures necessary to comply
Important Bird Areas in the European Community' —                        with the directives which are addressed to them within the
IBA89 and IBA94 ). As regards the legal relevance of IBA89               period prescribed therein. That period expired on 1 July
and IBA94, the Commission considers that the objectives of               1991 without the Kingdom of Spain having brought into
Article 4(1 ) would be best served if the Member States were             force the necessary provisions.
in fact to classify all the areas mentioned in the inventory as
special protection areas . Since, however, the Member States             (') OJ No L 353 , 17. 12 . 1990 , p . 73 .
enjoy a certain discretionary power in this field, it does not           ( 2 ) OJ No L 165 , 7. 7 . 1993 , p . 1 .
seem to the Commission to be possible to impose that                     ( 3 ) OJ No L 167, 30 . 6 . 1975 , p . 1 .
maximum result by law. On the other hand, there may be a
breach of the obligation of classification if a Member State
manifestly disregards the number and size of the IBA89 and
IBA94 areas. This is particularly so if a Member State
classifies as special protection areas under half, in terms
both of number and of total size, of the areas listed in IBA89           Reference for preliminary ruling from the Bundes­
and IBA94 . Special protection areas must, moreover, be                  verwaltungsgericht by order of that court of 3 1 August 1995
sufficiently varied and representative to offer protection for           in the case of Badische Erfrischungs-Getranke GmbH 8t Co.
all the bird species listed in Annex I. The number and size of                           KG v. Land Baden-Wiirttemberg
the special protection areas classified by the Netherlands are                                      ( Case C- 17/96 )
not sufficient to meet those requirements .
                                                                                                      ( 96/C 77/ 14
                                                                         Reference has been made to the Court of Justice of
                                                                         the European Communities by order of the
                                                                         Bundesverwaltungsgericht ( Federal Administrative Court)
                                                                         — Third Senate — of 3 1 August 1 995 , received at the Court
Action brought on 11 January 1996 by the Commission of                   Registry on 19 January 1996 , for a preliminary ruling in the
the European Communities against the Kingdom of                          case of Badische Erfrischungs-Getranke GmbH & Co . KG
                                 Spain                                   v. Land Baden-Wurttemberg on the following questions :
                          ( Case C-5/96
                            ( 96/C 77/ 13 )                              1 . Is Article 1 ( 1 ) of Council Directive 80/777/EEC of
                                                                                15 July 1980 { l ) in conjunction with Annex I thereto
                                                                               ( Section I. Definition ) to be interpreted as meaning that
                (Language of the case: Spanish)                                water — apart from ' old water' covered by the second
                                                                               subparagraph of paragraph 2 of Section I. Definition of
An action against the Kingdom of Spain was brought before                      Annex I — is to be recognized as being natural mineral
the Court of Justice of the European Communities on                            water only if it has properties favourable to health and,
11 January 1996 by the Commission of the European                              if so, are those provisions to be interpreted as meaning
Communities, represented by B. J. Drijber and J. R. Vidal                      that those properties must be proved ?
Puig, of its Legal Service, acting as Agents, with an address
for service in Luxembourg at the office of Carlos Gomez de               2 . May the properties favourable to health which may be
la Cruz, of its Legal Service .                                                necessary also ensue from the absence or low content of