CELEX: 62002TJ0093
Language: en
Date: 2005-01-18 00:00:00
Title: Judgment of the Court of First Instance (Second Chamber, extended composition) of 18 January 2005. # Confédération nationale du Crédit mutuel v Commission of the European Communities. # State aid - Measures taken by the French Republic for Crédit Mutuel - Livret bleu - Decision 2003/216/EC - Duty to state reasons - Action for annulment. # Case T-93/02.

Case T-93/02
      Confédération nationale du Crédit mutuel
      v
      Commission of the European Communities
      (State aid – Measures taken by the French Republic for Crédit mutuel – Livret bleu – Decision 2003/216/EC – Duty to state reasons – Action for annulment)
      Judgment of the Court of First Instance (Second Chamber, Extended Composition), 18 January 2005 
      Summary of the Judgment
      1.     Acts of the Community institutions – Statement of reasons – Obligation – Scope – Commission decision on State aid – Judicial
            review 
      (Arts 87 EC and 253 EC)
      2.     Community law – Interpretation – Acts of the Community institutions – Statement of reasons – Taking into consideration 
      3.     State aid – Definition – Renunciation of tax revenue by a Member State – Renunciation leading to an indirect transfer of State
            resources to an undertaking distinct from the exonerated taxpayer – Included 
      (Art. 87(1) EC)
      4.     Commission – Principle of collegiality – Scope – Statement of reasons for decisions – Alteration after adoption – Unlawfulness
            – Consequence – Insufficiency in reasoning cannot be made good by explanations before the Court
      (Art. 253 EC)
      1.     The obligation to state reasons is an essential procedural requirement, as distinct from the question whether the reasons
         given are correct, which goes to the substantive legality of the contested measure. The statement of reasons required by Article
         253 EC must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed
         by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the
         reasons for the measure and to enable the competent court to exercise its power of review. The requirements of a statement
         of reasons must be appraised by reference to the circumstances of each case, in particular the content of the measure in question,
         the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct
         and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant
         facts and points of law, since the question whether the statement of reasons meets the requirements of Article 253 EC must
         be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in
         question.
      
      As to the point whether a decision is sufficiently reasoned with regard to the identification of the aid held to be incompatible
         with the Treaty, it is therefore necessary to determine whether that decision enables the persons concerned to ascertain the
         State measure or measures held by the Commission to constitute aid and the Court to exercise its power of review over the
         assessment of those measures. On the other hand, it is not relevant to ask whether, for the purposes of examining the statement
         of reasons, the treatment of those measures as aid is justified.
      
      (see paras 67-69)
      2.     The operative part of a measure is indissociably linked to the statement of reasons and, when it has to be interpreted, account
         must be taken of the reasons that led to its adoption.
      
      (see para. 74)
      3.     It is not necessary, in order to found a finding of the existence of intervention by means of State resources in favour of
         an undertaking, that the undertaking must be the direct recipient. The fact that a Member State renounces tax revenue may,
         indeed, involve an indirect transfer of State resources, capable of being treated as aid to economic operators other than
         those to which the tax advantage is accorded directly.
      
      (see para. 95)
      4.     The operative part and the statement of reasons of a decision – which must be reasoned under Article 253 EC – constitute an
         indivisible whole, with the result, if its adoption falls within the powers of the College of Commissioners, that it is for
         the latter alone, in accordance with the principle of collegiate responsibility, to adopt both the one and the other, since
         any alternation to the statement of reasons going beyond simple corrections of spelling or grammar is its exclusive province.
         It follows that the arguments presented by the Commission’s agents before the Court cannot make good the insufficiency of
         the contested decision’s reasoning.
      
      (see paras 124, 126)

      
      
      
      
      
      
      
      
      
      
      
      
      
      
      
            
            JUDGMENT OF THE COURT OF FIRST INSTANCE (Second Chamber, Extended Composition)18 January 2005(1)
         
         
               (State aid  –  Measures taken by the French Republic for Crédit mutuel  –  Livret bleu  –  Decision 2003/216/EC  –  Duty to state reasons  –  Action for annulment)
               
             In Case T-93/02,
            
            
            Confédération nationale du Crédit mutuel,  established in Paris (France), represented by A. Carnelutti and J.-P. Gunther, lawyers,
            
            
            applicant, supported byFrench Republic,  represented by G. de Bergues and F. Million, acting as Agents, with an address for service in Luxembourg,
            
            intervener,
            
            v
            Commission of the European Communities, represented by G. Rozet, acting as Agent, with an address for service in Luxembourg,
            
            defendant,
            
             ACTION for annulment of Commission Decision 2003/216/EC of 15 January 2002 on State aid granted by France to Crédit mutuel
            (OJ 2003 L 88, p. 39), in the form of  excess compensation for collection and management costs of regulated savings under
            the ‘Livret bleu’ system, 
            
            
            THE COURT OF FIRST INSTANCEOF THE EUROPEAN COMMUNITIES (Second Chamber, Extended Composition),
            
            
             composed of J. Pirrung, President, V. Tiili,  A.W.H. Meij, M. Vilaras and N.J. Forwood, Judges,
            
             Registrar:  J. Palacio González, Principal Administrator,
            
            
            
         gives the following
         
         
         Judgment
            
               Background to the dispute
            
         
         1
            
          By this action, the Confédération nationale du Crédit mutuel asks the Court to annul Commission Decision 2003/216/EC of 15
         January 2002 on State aid granted by France to Crédit mutuel (OJ 2003 L 88, p. 39, hereinafter ‘the contested decision’).
         
         Crédit mutuel
         
         2
            
          Crédit mutuel is a non-centralised banking group consisting of a network of local Crédit mutuel branches with the status of
         cooperative companies. Each local Crédit mutuel branch must belong to a regional federation and each federation must belong
         to the Confédération nationale du Crédit mutuel, the central body of the network for the purposes of Article L511-30 of the
         French Monetary and Financial Code. That organisation, the applicant in this case, has the status of a non-profit-making association.
         
         
         
         3
            
          The number of local Crédit mutuel branches, each of which may have one or more counters, declined from 2 031 in 1991 to 1
         820 in 2001. When the contested decision was adopted, those branches were owned by about 5.7 million members. Between 1999
         and 2001, Crédit mutuel was the fifth biggest French bank in terms of savings and the third in terms of its branch network.
         
         Livret bleu
         
         4
            
          The Livret bleu, created by Law No 75-1242 of 27 December 1975 implementing the corrective law on finance for 1975 (JORF of 28 December 1975,
         p. 13435), is a regulated savings product, aimed at the general public, for which Crédit mutuel was granted exclusive distribution
         rights by the authorities.
         
         
         
         5
            
          Crédit mutuel’s interest rates on Livret bleu  deposits are regulated by the Government. The net-of-tax interest rate applied to savers is identical to that of the LivretA (distributed by the Caisses d’épargne and La Poste), its main rival savings product. That rate was 3% per year at the time
         of the adoption of the contested decision. The amount of savings per Livret cannot exceed a ceiling which is identical to that set for the LivretA, which, from 1991, was FRF 100 000 (EUR 15  245) for private customers and which has been EUR 15 300 since 1 January 2002.
         
         
         
         6
            
          The payment of interest on Livretbleu savings is subject to tax treatment which derogates from the taxation rules normally applied to savings. While the general
         tax legislation enables natural persons to opt, as regards particularly interest on savings if the person liable for such
         interest is established in France, for deduction of tax at source instead of paying income tax, such an option does not exist
         for the payment of interest on the Livretbleu which is subject, in all cases, to deduction of tax at source. However, only a third of that interest is subject to such
         deduction.
         
         
         
         7
            
          The funds collected via the Livretbleu, the amount of which fluctuated during the 1990s from FRF 80 to 100 thousand million, have been allocated in different ways
         from the outset. Originally, Crédit mutuel was obliged to allocate 50% of the funds (raised to 65% in 1983) to general interest
         assets (hereinafter ‘GIA’), particularly to finance local authorities and to subscribe for securities issued by the State
         and its public undertakings, any balance being at the bank’s disposal.
         
         
         
         8
            
          With effect from a Decree of 27 September 1991 (JORF of 26 November 1991, p. 15383), an increasing part of the total was allocated
         to public housing, particularly by centralising the funds with the Caisse des dépôts et consignations (hereinafter ‘the CDC’),
         which assigns the funds allocated to it to the financing of public housing, by granting loans to bodies managing low rent
         accommodation, in the same way as the funds from the LivretA, the Caisses d’épargne and La Poste. Since the Decree of 27 September 1991 all new funds collected by the Livretbleu were used to finance public housing, and the total amount at 31 December 1990 was to be gradually transferred to the CDC
         in annual instalments of 10% up to 2000. Today, the entire total is centralised with the CDC.
         
         
         
         9
            
          Since 1991, the CDC pays Crédit mutuel, solely in respect of centralised funds, a fee corresponding to the gross interest
         rate set by the authorities, passed on to savers, as well as a brokerage commission equal to 1.3% of the total (hereinafter
         ‘the brokerage commission’).
         
         
         
         10
            
          During the period examined by the contested decision, three uses of the funds from the Livretbleu can be distinguished:
         
         
         
          
         –
            the funds centralised with the CDC from 1991 (intended to finance public housing and subject to payment of the brokerage commission);
               
            
         
         
         
         
          
         –
            the GIA other than the abovementioned funds (consisting above all in long-term loans to public authorities, hereinafter ‘the
               other GIA’);
            
         
         
         
         
          
         –
            assets chosen by Crédit mutuel.
         
         
          The last two categories of assets were, however, intended to be phased out gradually during that period.
         
         
         
         11
            
          The Livretbleu played an important role for Crédit mutuel. Its relative importance in quantitative terms declined, however, in the course
         of the years prior to 2002. The share accounted for by the Livretbleu in Crédit mutuel’s deposits, which was 70 % in 1975 and still almost 60 % in 1985, has fallen to under 25 % since 1997.
         
         Administrative procedure
         
         12
            
          On 25 January 1991, a complaint was made to the Commission concerning the aid granted by the French Republic to Crédit mutuel
         in respect of the Livretbleu. By letter of 6 February 1998, the Commission informed the French authorities that it had decided to initiate the investigation
         procedure laid down in Article 88(2) EC (OJ 1991 C 146, p. 6).
         
         
         
         13
            
          Crédit mutuel sent a letter to the Commission on 18 June 1998 setting out arguments to refute the description of the measures
         covered by the proceedings as State aid, together with analytical accounts for the Livretbleu. Numerous interested parties, including the complainants, also submitted their comments to the Commission.
         
         
         
         14
            
          In the light of the file submitted by Crédit mutuel, the Commission decided to conduct an audit of the Livretbleu’s analytical accounts. For that purpose, it recruited a consultant whose final report was submitted to the French authorities
         and to Crédit mutuel for their consideration on 10 January 2000. In May 2000, the applicant instructed another consultant
         to review the methodology used in Crédit mutuel’s analytical accounts and to draw up a profit and loss account for the Livretbleu. That task was completed in September 2000 with the submission of a detailed report. In April 2001, the Commission extended
         its consultant’s contract to allow him to identify the discrepancies between the two accounting reports and to determine which
         modifications of figures or methodology could legitimately be accepted and integrated into his previous evaluation. The consultant’s
         final report was sent to the French authorities on 23 July 2001. Crédit mutuel and its consultant announced that they disagreed
         with the final conclusions of the Commission’s consultant.
         
         Contested decision
         
         15
            
          On 15 January 2002, the Commission adopted the contested decision.
         
         
         
         16
            
          After summarising the facts and observations received in the course of the administrative procedure, the Commission devotes
         Section V of the contested decision to the assessment of the compensation measures granted to Crédit mutuel. That section
         contains five subsections.
         
         
         
         17
            
          Subsection V.1 of the contested decision is devoted to ‘[t]he distortion of competition and the effect on trade between Member
         States’ and ends, in recital 92, with the following conclusion:
         ‘Given the nature of the potential aid granted to Crédit mutuel as operating aid as well as the economic situation in the
         European banking sector and the solvency constraints specific to the banking sector, this aid has had an effect on trade from
         the entry into force of the Livretbleu and has had an increasing effect of distorting competition in the financial sector. Consequently it must be considered that
         the potential aid was new aid when introduced in 1975.’
         
         
         
         18
            
          After examining, in Subsection V.2 of the contested decision, the ‘Definition of State resources’, the Commission explains,
         in recital 100, which, by itself, forms Subsection V.3, entitled ‘The competitive advantage’, that:
         ‘If the compensation received by Crédit mutuel for the public service, taking the form of a fund collection commission [brokerage
         commission] paid by CDC, exceeds the net costs arising from the public service (mindful of all the costs and benefits relating
         to the provision of the service), Crédit mutuel benefits from a competitive advantage over other banks since it receives additional
         resources that are not granted to other banks.’
         
         
         
         19
            
          In recital 101 in the contested decision, in Subsection V.4, devoted to ‘[a]ssessment of the amount of State aid’, the Commission
         defines its approach as regards the determination of the amount of the aid in the following terms:
         ‘Since the French authorities have invoked the existence of a general economic interest task linked to the Livretbleu system, the Commission must focus on obtaining a balance of the income and expenditure linked to the performance of this
         service in order to determine a justifiable level of compensation paid by the State.’
         
         
         
         20
            
          Following the various accountants’ reports, the Commission reached the following findings concerning the results of the Livretbleu profit and loss account:
         
         
         
          
         –
            the management of the funds transferred to the CDC resulted in losses throughout the 1990s, but produced a profit in 1998;
         
         
         
         
          
         –
            the management of the other GIA produced profits estimated, during the 1990s, at an annual amount between FRF 59 million and
               FRF 957 million;
            
         
         
         
         
          
         –
            the management of the assets chosen by Crédit mutuel resulted in losses.
         
         
         
         
         
         21
            
          Those results were summarised, in recital 179 of the contested decision, in the following table (in FRF million):
         
         
         Year
                  
               
               1991
                  
               
               1992
                  
               
               1993
                  
               
               1994
                  
               
               1995
                  
               
               1996
                  
               
               1997
                  
               
               1998
                  
               
               Total
                  
               
            Funds trans-ferred to CDC
                  
               
               ... 1  –Confidential data omitted.
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               -399
                  
               
            General interest assets
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               2 592
                  
               
            Freely chosen assets
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               …
                  
               
               -1 119
                  
               
            Total pre-tax margin
                  
               
               1 096
                  
               
               505
                  
               
               301
                  
               
               - 471
                  
               
               -135
                  
               
               -87
                  
               
               -156
                  
               
               20
                  
               
               1 074
                  
               
            
         22
            
          As regards the establishment of the overall balance of the income and expenditure connected to the performance of the general
         economic interest service linked to the Livretbleu system, the Commission states:
         ‘[109] The income from the general interest assets must be taken into account in any case since it forms an integral part
         of the obligations imposed by the State in the context of the Livretbleu system. It should also be noted that excluding some assets that are profitable would be absurd: the State would have to compensate
         for losses made by some assets, even though sufficient profit was being made from other assets within the Livretbleu system, which is not taken into account.
         [110] The situation is less clear in relation to the assets freely [chosen] by Crédit mutuel, which recorded a loss of approximately
         FRF [1 000 million] over the period under review. These losses affect the State budget since, if they did not exist, it would
         be balanced, thus requiring the collection commission to be lowered accordingly. The Commission considered, however, that
         the net cost of the assets freely chosen by Crédit mutuel should be included.’
         
         
         
         23
            
          In respect of the final assessment, the Commission states in recital 180 in the contested decision:
         ‘Insofar as the sum of the financial benefits entered in the accounts that were generated by the Livretbleu (collection commission, profit from management of general interest assets, profit from management of funds on its own account,
         in other words using them for assets chosen by the bank) exceeds the costs incurred by Crédit mutuel in managing the collection
         process and funds, there is a transfer of public resources that constitutes State aid.’
         
         
         
         24
            
          The Commission therefore evaluates the amount of aid accumulated over the period 1991 to 1998 at the total of the results
         appearing in the table reproduced in paragraph 21 above, namely FRF 1 074 million.
         
         
         
         25
            
          After examining, in Subsection V.5, the compatibility with the Treaty of the aid granted to Crédit mutuel, the Commission
         concludes in Section VI of the contested decision: 
         ‘[202] The granting to Crédit mutuel of the right of distribution of the Livretbleu contains State aid within the meaning of Article 87(1) [EC]. This aid is not eligible for any of the derogations provided
         for in Article 87(2) and (3) [EC].
         [203] The derogation provided for in Article 86(2) [EC] can be only partly applied since, as demonstrated by the audit conducted
         on behalf of the Commission, the compensation granted during the period is not strictly limited to the excess costs relating
         to the general economic interest service which may be taken into account. As this was the only possible derogation permitting
         the exemption of the measures in question from the obligations laid down in the rules of competition, notably the prohibition
         under Article 87(1) [EC], the result is that the fraction of State resources granted to Crédit mutuel which exceeds the net
         costs of managing and collecting the Livretbleu, mindful of a normal profitability margin, constitutes excess compensation of the costs of the public service and therefore
         constitutes State aid that is incompatible with the common market.’
         
         
         
         26
            
          Article 1 of the contested decision provides:
         ‘1. The measures taken by France for Crédit mutuel involving the collection and management of regulated savings under the
         Livretbleu system comprise State aid that is incompatible with the common market.
          2. The aid is not eligible for any derogation under Article 87(2) and (3) [EC]. It may be partly eligible for the derogation
         provided for in Article 86(2) [EC], insofar as it is essential for the performance of the general economic interest task entrusted
         to Crédit mutuel by the State. The aid exceeding the cost of collecting and managing the Livretbleu cannot be regarded as compatible with the general interest.’
         
         
         
         27
            
          Under Article 2(1) of the contested decision, ‘France shall recover from Crédit mutuel the aid incompatible with the common
         market granted to it since 1 January 1991’. That paragraph also contains instructions for determining the amount of aid which
         France is required to recover.
         
         
         
         28
            
          Paragraphs (2) to (5) of Article 2 provide as follows:
         ‘2. France shall modify the rate of commission for the Livretbleu savings paid by the [CDC] to Crédit mutuel with a view to eliminating in future all aid that exceeds the management and collection
         costs that may be taken into account.
          3. The French authorities shall ask Crédit mutuel to introduce and publish separate accounts for the Livretbleu.
          4. The French authorities shall send to the Commission the bank’s annual report and a [triennial] report on the Livretbleu accounts.
          5. The Commission shall conduct any checks it deems appropriate to verify that the aid to Crédit mutuel is strictly in proportion
         with the general economic interest task entrusted to it. It shall, if it deems necessary, mandate consultants to audit the
         Livretbleu’s analytical accounts.’
         
         Procedure and forms of order sought by the parties
         
         29
            
          By application lodged at the Court Registry on 28 March 2002, the applicant brought this action.
         
         
         
         30
            
          By order of 11 September 2002, the French Republic was granted leave to intervene in support of the forms of order sought
         by the applicant.
         
         
         
         31
            
          Upon hearing the report of the Judge-Rapporteur, the Court (Second Chamber, Extended Composition) decided to open the oral
         procedure and, by way of measures of organisation of the procedure as provided for in Article 64 of the Rules of Procedure,
         requested the parties to produce certain documents and to reply to written questions. The parties gave their replies and produced
         the documents within the time-limit laid down.
         
         
         
         32
            
          The parties presented oral argument and their replies to oral questions from the Court at the public hearing on 8 June 2004.
         They were requested to reply, in writing, to two additional questions, which they did within the time-limit laid down. The
         oral procedure was closed on 14 July 2004.
         
         
         
         33
            
          The applicant claims that the Court should:
         
         
         
          
         –
            annul the contested decision;
         
         
         
         
          
         –
            in the alternative, annul Article 2 thereof in so far as it orders recovery of the aid identified;
         
         
         
         
          
         –
            order the Commission to pay the costs.
         
         
         
         
         
         34
            
          The French Republic, as intervener, claims that the Court should:
         
         
         
          
         –
            annul the contested decision;
         
         
         
         
          
         –
            order the Commission to pay the costs.
         
         
         
         
         
         35
            
          The Commission contends that the Court should:
         
         
         
          
         –
            dismiss the action;
         
         
         
         
          
         –
            order the applicant to pay the costs.
         
         
         
         LawPreliminary observations
         
         36
            
          In support of its claim for annulment, the applicant raises seven pleas in law. By the first plea in law, alleging infringement
         of Article 87(1) EC, it claims that the measures covered by the contested decision cannot constitute aid. The second to fourth
         pleas in law, raised in the alternative, seek to show that if it were aid it could not constitute existing aid. By the fifth
         plea in law, also in the alternative, the applicant claims that the Commission infringed the provisions of Article 14 of Council
         Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article 93 of the EC Treaty
         (OJ 1999 L 83, p. 1), in that it ordered the repayment of the alleged aid. By its sixth plea in law, the applicant accuses
         the Commission of having infringed the applicant’s procedural rights and the principle of sound administration. The seventh
         plea in law alleges breach of Article 253 EC.
         
         
         
         37
            
          It emerges from all the pleas in law of the parties that the main question raised by these proceedings is that of the identification,
         by the contested decision, of the aid, that is to say of the State measure which conferred an advantage on Crédit mutuel.
         It is therefore necessary to determine whether the contested decision states, with sufficient clarity, the measures and advantages
         which constitute, in this case, aid which is incompatible with the Treaty. 
         
         The contested decision’s reasoning with regard to the identification of the aid Arguments of the parties
         
         
         38
            
          The applicant’s complaints concerning the identification of the aid appear, first, in the third to fifth parts of the seventh
         plea in law, alleging infringement of the duty to state reasons. Secondly, the applicant puts forward, particularly as part
         of its first and fourth pleas in law, arguments intended to show that the contested decision’s reasoning is insufficient and
         contradictory in so far as it relates to various aspects of the definition of the aid. Likewise, the Commission deploys arguments
         concerning the identification of the aid as part of its arguments on the first, fourth and seventh pleas in law.
         
         
         
         39
            
          The parties’ arguments concern, in essence, three aspects of the definition of the aid in issue, namely:
         
         
         
          
         –
            the identification of the measure capable of having conferred an advantage on Crédit mutuel;
         
         
         
         
          
         –
            the identification of the State resources by means of which the advantage in question was conferred;
         
         
         
         
          
         –
            the description, in relation to the Livretbleu scheme, as new aid since 1975.
            
         
         
         
         
         – The identification of the measure which conferred an advantage
         
         
         40
            
          In the context of the first part of its first plea in law, the applicant submits that the contested decision is ambiguous
         and contradictory in relation to the identification of the measures which, according to the Commission, conferred an advantage
         on Crédit mutuel.
         
         
         
         41
            
          The applicant argues first that, in the contested decision, the Commission did not identify any advantage capable of constituting
         State aid and also of being readily quantified.
         
         
         
         42
            
          It points out that the only element identified by the Commission as capable of ‘leading to aid’ (but without, in itself, constituting
         aid) is the brokerage commission. The applicant, however, takes the view that the Commission implicitly held that the advantage
         arose just as much from the other Livretbleu products, because it adopted an ‘overall method’, by which all the income obtained by Crédit mutuel from the Livretbleu and all the costs connected to that product’s distribution were taken into account in order to evaluate whether the remuneration
         which Crédit mutuel obtains for its task of distributing the Livretbleu is appropriate. It submits that the contested decision is vitiated by a lack of clarity in that regard.
         
         
         
         43
            
          The applicant criticises the Commission’s reasoning, first, in relation to the decision as to the partial tax exoneration
         and exclusive distribution of the Livretbleu; secondly, as regards the consideration of the Livretbleu’s assets, and, thirdly, as regards the evaluation of the brokerage commission.
         
         
         
         44
            
          As regards, first, the tax exoneration and exclusivity, the applicant points out that the Commission, although it abandoned
         any allegation relating to possible ‘loss-leader effect’ of the Livretbleu, persists in alleging, by allusion, that because of its tax exoneration and the fact that it is distributed only by a single
         credit institution, the Livretbleu confers particular advantages on Crédit mutuel. In its reply, the applicant observes that the contested decision contained
         no evidence that the exclusivity conferred any advantage. It submits that that is a clear failure to state reasons to be raised,
         if need be, of the Court’s own motion. 
         
         
         
         45
            
          Secondly, in relation to the Livretbleu’s assets, the applicant submits that the contested decision is vitiated by a manifest failure to state reasons on the point
         whether the income from the other GIA can constitute an advantage. In its submission, the mere fact that those operations
         constituted one of the uses of the sums deposited under the Livretbleu system does not, in any event, lead to the conclusion that Crédit mutuel obtained conditions more favourable than those resulting
         from normal market operations.
         
         
         
         46
            
          Thirdly, the applicant takes the view that it is also impossible to regard the brokerage commission as an economic advantage
         conferred in non-market conditions. It submits that the Commission mistakes the nature of that brokerage commission. The applicant
         argues, further, that it is not clear, from the wording of the contested decision, whether the aid identified by the Commission
         consists in the brokerage commission in its entirety or only in a fraction thereof and, in that case, what fraction is capable
         of being so described.
         
         
         
         47
            
          In its reply, the applicant adds that the application of the ‘overall method’ in the contested decision contains an obvious
         contradiction and leads to an incoherent result. It states that, at several places in the contested decision, brokerage commission
         is alone identified as possible aid, although the other assets (other GIA and assets chosen by Crédit mutuel) are not taken
         into account in calculating the system’s net cost. It does not deny that the brokerage commission could constitute aid were
         it greater than the cost of managing the Livretbleu and if all the other conditions for the application of Article 87 EC were satisfied, since the activity remunerated would
         be profitable and it would be inappropriate to pay for it. According to the applicant, the Commission however found that the
         amount of the aid corresponds not to the brokerage commission, but to the (positive) balance of Crédit mutuel’s business connected
         to the Livretbleu. Thus, the Commission included in the amount of the aid all the profits made by Crédit mutuel and particularly those arising
         from other GIA. The applicant states that that contradiction makes it impossible to understand what the aid identified by
         the Commission consists of and justifies, by itself, the annulment of the contested decision.
         
         
         
         48
            
          Finally, the applicant describes as aberrant the results of the Commission’s action from the point of view of the amounts
         which must be repaid to the State by Crédit mutuel. It points out that, if one examines the Livretbleu’s profit and loss account, between 1991 and 1998, it is clear from the contested decision that only the first three years produced
         an operating profit, which amounted to FRF 1 096 million in 1991, to FRF 505 million in 1992 and to FRF 301 million in 1993.
         In its submission, those profits are entirely due to products other than the brokerage commission which, during the same years,
         brought in receipts of FRF 8, 62 and 113 million respectively. By contrast, during the years 1994 to 1997, an operating loss
         was recorded even though the share of the brokerage commission in the Livretbleu’s income continued to increase. The applicant points out that the brokerage commission could not have contributed to the first
         three years’ profits, nor did it prevent a loss in the course of the four following years. According to the applicant, while
         the positive results of the first three years could, in those circumstances, preclude payment of brokerage commission during
         those same years, there is, conversely, no justification for totalling the figures over a long period to arrive at repayments
         substantially exceeding the amounts arising from the brokerage and management commission for the years which produced a net
         profit. 
         
         
         
         49
            
          The Commission takes the view that the wording of the contested decision is not ambiguous. In support of that argument, it
         refers to recital 203 in the contested decision (see paragraph 25 above) and to Article 1(1) of its operative part (see paragraph
         26 above).
         
         
         
         50
            
          In reply to the questions put by the Court, the Commission states that the payment of brokerage commission is the only measure
         which, according to the contested decision, conferred State aid on Crédit mutuel. In its submission, that is clear from recitals
         14, 28, 30, 66, 98, 167 and 168 and particularly from Article 2(2) of the operative part of the contested decision.
         
         
         
         51
            
          On the other hand, the Commission states that the contested decision treated neither the tax exoneration nor the exclusive
         right to distribute the Livretbleu as advantages. In its submission, it is clear from the contested decision that the tax reduction, which involves a use of
         State resources, directly benefits individual consumers and not the bank.
         
         
         
         52
            
          In relation to the Livretbleu’s assets, the Commission states that it is wrong to maintain that the contested decision found that the normal income (‘profits’)
         from managing the Livretbleu constituted State aid incompatible with the common market. It takes the view that that complaint is the result of confusion
         between, on the one hand, the concept of competitive advantage resulting from excess compensation by State resources of the
         net costs of the general economic interest task and, on the other hand, the concept of financial advantages taken into account
         (just as are the expenses and costs incurred) to establish the net costs of performing that task. The Commission takes the
         view that recital 100 in the contested decision (reproduced in paragraph 18 above) explains, without ambiguity, the question
         of competitive advantage. At the hearing, the Commission explained, in reply to a question from the Court, that certain passages
         in the contested decision which mention the concept of advantages in the context of the cost of the Livretbleu’s resources appear in the section devoted to establishing the balance from the business and therefore cover exclusively the
         second abovementioned concept.
         
         
         
         53
            
          As regards the arguments put forward in the reply, the Commission contends that the applicant is raising a completely different
         claim to that raised initially in the application. It submits that the applicant misconstrues the definition of the aid in
         Article 1 of the contested decision and takes no account of the fact that the analysis of the accounts enabled a balance to
         be established not only of the expenditure linked to the performance of the task of serving the general economic interest
         entrusted to Crédit mutuel, but also a balance of all the resources (income from commercial operation and State resources)
         obtained from the performance of that task. The Commission notes that the balance of that account represents ‘the fraction
         of the State resources granted to Crédit mutuel which exceeds the net costs of managing and collecting the Livretbleu [taking account] of a normal profitability margin’.
         
         
         
         54
            
          Finally, the Commission maintains that the sum of FRF 1 074 million mentioned in recital 178 and Article 2(1) of the contested
         decision constitutes, in effect, for the period 1991 to 1998, the amount of public resources received during that period in
         excess of the costs of collecting and managing the Livretbleu.
         
         
         – The identification of the State resources
         
         
         55
            
          The applicant takes the view that the Commission did not state sufficient reasons for classifying certain elements in the
         system of the Livretbleu as State resources.
         
         
         
         56
            
          First, as regards the partial tax exoneration, no reasons are given as regards the fact that the Livretbleu system leads to the taxation of persons not otherwise subject to tax. The applicant points out that the contested decision
         found that consumers alone benefit from that exoneration.
         
         
         
         57
            
          Secondly, the reasoning in the contested decision does not make clear whether the income from the other GIA is classified
         as State resources. The contested decision confines itself to holding that it is part of the Livretbleu system, without more details. The applicant takes the view that, if that observation means that such income is State resources,
         it is ambiguous and, for that reason, inadequate. In the reply, the applicant maintains that it is paradoxical that the Commission
         denies that the income from the other GIA could have constituted State resources whereas, in the contested decision, that
         income was included in the total of the sums which must be repaid by Crédit mutuel to the State. It submits that it is inconceivable
         that sums have been made the subject of a demand for repayment without having been treated as State aid and, therefore, without
         having been assimilated to State resources. 
         
         
         
         58
            
          Thirdly, the applicant and the intervener take the view that the Commission has not stated sufficient reasons for its finding
         that the brokerage commission is a State resource.
         
         
         
         59
            
          The Commission points out that the provisions of Article 253 EC require it to state reasons only for positions adopted in
         a legal measure. It takes the view that the conclusion of the contested decision in recital 203 states, without the least
         ambiguity, that, since the State’s financial intervention creates excess compensation for the net costs caused by the task
         of serving the general economic interest imposed on Crédit mutuel, that excess compensation constitutes State aid incompatible
         with the common market.
         
         
         
         60
            
          It states that the tax exoneration was not treated, by the contested decision, as State resources or aid for the benefit of
         Crédit mutuel.
         
         
         
         61
            
          The Commission also disputes the argument that the contested decision treats the income from the other GIA as State resources.
         It observes that the applicant’s and the intervener’s argument on that subject result from confusion between, on the one hand,
         the competitive advantage arising from excess compensation by the State for the costs of the general economic interest task
         entrusted to Crédit mutuel and, on the other hand, the financial advantages taken into account to establish the net costs
         of that task.
         
         
         
         62
            
          In the rejoinder, the Commission points out that the contested decision condemns only the brokerage commission, paid since
         1991, as a State resource. At the hearing, the Commission added, in reply to a question from the Court, that that is obvious
         from recital 14 and Article 2(2) of the contested decision. It submits that the reasoning in the contested decision is sufficient
         as regards the treatment of that commission as a State resource.
         
         
         –The treatment of the Livretbleu system as new aid when it was established in 1975
         
         63
            
          The applicant claims that the contested decision states, in recital 92, that the Livretbleu system must be regarded as new aid from 1975, without giving any reasons in that regard. The arguments in that context, relating
         to the evaluation of its effect on trade and competition, do not state the reasons why that system partook of the nature of
         aid in 1975. That treatment is, furthermore, contradicted by the statements in the decision that it is impossible to go back
         earlier than 1991 to determine whether there was aid. At the hearing, the applicant submitted that there is a flagrant contradiction
         between the statement that the aid dates from 1975 and that according to which the financing of the Livretbleu is an aid scheme or new aid since 1991. In the applicant’s submission, the Commission confused two alleged aids, that of
         1975 and that of 1991, and that confusion is also found in the method used to calculate the alleged aid. The applicant takes
         the view that that confusion makes the contested decision difficult to understand.
         
         
         
         64
            
          In that context, the applicant argues that the Commission could not conclude that the Livretbleu system should be treated as new aid without proving, first, that it was aid. The contested decision contains no evidence,
         however, that it was aid when the Livretbleu was created.
         
         
         
         65
            
          The Commission takes the view that the contested decision states sufficient reasons in relation to the Livretbleu’s treatment as aid since 1975. It observes that the analysis criticised is developed in Subsection V.l of the contested decision,
         entitled ‘The distortion of competition and the effect on trade between Member States’. In reply to a question from the Court,
         it stated, at the hearing, that it undertook the analysis in that section of the contested decision before expounding the
         other characteristic elements of the concept of State aid, and particularly before taking position on the question of State
         resources. The analysis of the Livretbleu’s effects on trade and competition from 1975 is explained, according to the Commission, by the fact that it was bound to rule
         on the complainants’ arguments relying, in particular, on an element of aid resulting from the Livretbleu’s ‘loss-leader effect’, such effect, assuming that it contains an element of aid, having existed since the introduction of
         the Livretbleu in 1975. Furthermore, it cites Joined Cases T-298/97, T-312/97, T-313/97, T‑315/97, T‑600/97 to T‑607/97, T‑1/98, T‑3/98
         to T‑6/98 and T-23/98 Alzetta and Others v Commission [2000] ECR II-2319, paragraphs 142 to 148, according to which it is required to examine whether, when the aid was established,
         the market concerned was open to competition. It observes that recital 92 of the contested decision, which contains the conclusion
         of that section, speaks of ‘potential aid’, which shows that the measure was not yet classified definitively at that stage.
         It submits that the adjective ‘potential’ subsequently disappeared from the wording of the contested decision in an effort
         to make it succinct and for reasons of material contingency.
         
         
         
         66
            
          The Commission maintains that the contested decision states that the relevant fact in this file results from the use made
         by Crédit mutuel of the funds collected by means of the Livretbleu which were available to it. In its submission, it is in that respect that there is distortion of competition. 
         
          Findings of the Court
         
         
         67
            
          As a preliminary point, it must be borne in mind that the obligation to state reasons is an essential procedural requirement,
         as distinct from the question whether the reasons given are correct, which goes to the substantive legality of the contested
         measure (Case 367/95 P Commission  v Sytraval and Brink’s France [1998] ECR I‑1719, paragraph 67, and Case C-17/99 France  v Commission [2001] ECR I‑2481, paragraph 35).
         
         
         
         68
            
          The statement of reasons required by Article 253 EC must be appropriate to the act at issue and must disclose in a clear and
         unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable
         the persons concerned to ascertain the reasons for the measure and to enable the competent court to exercise its power of
         review. The requirements of a statement of reasons must be appraised by reference to the circumstances of each case, in particular
         the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure,
         or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for
         the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets
         the requirements of Article 253 EC must be assessed with regard not only to its wording but also to its context and to all
         the legal rules governing the matter in question (Joined Cases 296/82 and 318/82 Netherlands and Leeuwarder Papierwarenfabriek  v Commission [1985] ECR 809, paragraph 19, Case C-350/88 Delacre and Others  v Commission [1990] ECR I‑395, paragraphs 15 and 16, Case C-56/93 Belgium v Commission [1996] ECR I‑723, paragraph 86, Commission v Sytraval and Brink’s France, cited in paragraph 67 above, paragraph 63, and France v Commission, cited in paragraph 67 above, paragraphs 35 and 36).
         
         
         
         69
            
          As to the point whether the contested decision is sufficiently reasoned with regard to the identification of the aid held
         to be incompatible with the Treaty, it is therefore necessary to determine whether that decision enables the persons concerned
         to ascertain the State measure or measures held by the Commission to constitute aid and the Court to exercise its power of
         review over the assessment of those measures. On the other hand, it is not relevant to ask whether, for the purposes of examining
         the statement of reasons, the treatment of those measures as aid is justified.
         
         
         – Operative part and ‘Conclusion’ of the contested decision
         
         
         70
            
          It must be observed, first of all, that Article 1(1) of the contested decision, according to which ‘the measures taken by
         [the French Republic] for Crédit mutuel involving the collection and management of regulated savings under the Livretbleu system comprise State aid that is incompatible with the common market’, does not explicitly state which State measures relative
         to the Livretbleu system are found, by that decision, to have granted aid to Crédit mutuel. 
         
         
         
         71
            
          The Commission’s case that Article 2(2) of the operative part of the contested decision states clearly that the brokerage
         commission was alone found to be State aid cannot be accepted.
         
         
         
         72
            
          Admittedly, that provision, which requires the French Republic to modify the rate of commission for the Livretbleu savings paid by the CDC with a view to eliminating in future all aid that exceeds the management and collection costs refers
         only to the brokerage commission. It does not, however, identify the aid, but the measures which the French Republic is required
         to take in future in order to avoid paying aid in the form of the brokerage commission. It is common ground that the centralisation
         of the Livretbleu savings with the CDC was completed in 1999 and that, from that time, the brokerage commission is the only income drawn by
         Crédit mutuel from the management of the Livretbleu. Therefore, that paragraph of the operative part enables no conclusion to be drawn as regards the definition of the aid held
         in Article 1(1) of the contested decision to be incompatible with the common market for the years prior to the completed centralisation.
         
         
         
         73
            
          It follows that the designation of the aid in the operative part of the contested decision is not sufficient to enable the
         persons concerned and the Court to ascertain the measure or measures found, in this case, to constitute aid.
         
         
         
         74
            
          It is settled law that the operative part of a measure is indissociably linked to the statement of reasons and, when it has
         to be interpreted, account must be taken of the reasons that led to its adoption (Case C‑355/95 P TWD v Commission [1997] ECR I‑2549, paragraph 21; Joined Cases T-213/95 and T-18/96 SCK and FNK  v Commission [1997] ECR II‑1739, paragraph 104; Case T-136/94 Eurofer v Commission [1999] ECR II‑263, paragraph 171, and Alzetta and Others  v Commission, cited in paragraph 65 above, paragraph 163).
         
         
         
         75
            
          In that regard, in Section VI of the contested decision, entitled ‘Conclusion’, the Commission finds, in recital 202: ‘[t]he
         granting to Crédit mutuel of the right of distribution of the Livretbleu contains State aid within the meaning of Article 87(1) [EC]’. Recital 203 (reproduced in paragraph 25 above), upon which
         the Commission relies, refers to ‘the compensation granted’ and to ‘the measures in question’ before finding that ‘the fraction
         of State resources granted to Crédit mutuel which exceeds the … costs of managing and collecting the Livretbleu, “mindful of a normal profitability margin”, … constitutes State aid’. 
         
         
         
         76
            
          Since recital 202 of the reasons gives no details in relation to the operative part, and since recital 203 does not expressly
         identify the offending measures, it is necessary to examine whether the analysis, by the contested decision, of the conditions
         which must be satisfied for State intervention to be treated as aid enables the measures found to have conferred aid on Crédit
         mutuel to be identified exactly.
         
         
         – Analysis as regards the meaning of State aid
         
         
         77
            
          Under Article 87(1) EC four conditions must be satisfied in that respect. First, there must be an intervention by the State
         or through State resources. Second, the intervention must be liable to affect trade between Member States. Third, it must
         confer an advantage on the recipient. Fourth, it must distort or threaten to distort competition (Case C-280/00 Altmark Trans and Regierungspräsidium Magdeburg [2003] ECR I‑7747, paragraph 75).
         
         
         
         78
            
          The Commission examined those conditions in Subsections V.1 to V.4 (recitals 76 to 181) of the contested decision. It did
         not follow, however, in its analysis, the order in which those conditions are set out above. In fact, it dealt first of all,
         in Subsection V.1, with ‘[t]he distortion of competition and the effect on trade between Member States’, before considering,
         in Subsection V.2, the ‘Definition of State resources’. It continued in Subsection V.3, entitled ‘The Competitive advantage’,
         and finally, it devoted Subsection V.4 to ‘[t]he assessment of the amount of the State aid’. As will appear below, from the
         examination of the content of those various subsections, that progression gives rise to certain problems of comprehension
         which the contested decision poses. Therefore, it is appropriate to examine, following the order chosen by the Commission,
         whether the explanations contained in those four subsections enable the measures giving rise to the offending aid to be identified.
         
         
         
         – Analysis of the distortion of competition and the effect on trade
         
         
         79
            
          The Commission starts by examining, in recitals 76 to 92 in the contested decision, the second and fourth of the conditions
         mentioned in paragraph 77 above. Its analysis is divided into three stages, the first of which constitutes a detailed study
         of ‘[t]he effect [of the aid] on trade since 1975’; the second, a presentation of ‘[t]he completion of liberalisation of the
         banking sector in the European Union since the end of the 1970s and the strengthening of competition’, and the third, a reminder
         of ‘[t]he position of Crédit mutuel on the French banking market’.
         
         
         
         80
            
          As regards, first, the analysis of the effects on trade since 1975 (recitals 76 to 84 of the contested decision), it must
         be said that that part of the contested decision creates the impression that the Commission decided that the measures established
         in 1975 included aid to Crédit mutuel, without specifying, however, which of those measures were taken into account in this
         respect. The fact that the Commission made clear in the course of the proceedings before the Court that the aid consists of
         the brokerage commission established in 1991 is likely only to increase the confusion in that regard.
         
         
         
         81
            
          The explanation relating to that approach put forward by the Commission at the hearing, in reply to the Court’s questions,
         cannot remove the impression that the Commission may have decided that the aid at issue results, at least in part, from measures
         adopted in 1975. 
         
         
         
         82
            
          First of all, the statement that the examination of the effects on trade preceded the examination of State resources reveals
         a problem as regards the method followed by the Commission in this case. Admittedly, the criterion of a measure’s ability
         to affect trade between Member States is the dividing line between the scope of the Commission‘s scrutiny of aid and the area
         reserved to the independent action of the Member States, and the Commission has no power to intervene in respect of a State
         measure unless that criterion is satisfied. It is therefore desirable, particularly in the context of an investigation of
         a complex system made up of various State measures such as the Livretbleu, that the Commission should establish provisionally, when it opens the procedure and prior to initiating the analysis of
         the individual measures, whether that system as a whole is capable of affecting trade. However, in the Commission’s final
         decision, that provisional assessment must be replaced by a definitive assessment of the potential effects on trade between
         Member States of the measures classified definitively as aid. That is even more the case when the final decision classifies
         as aid only some of the measures covered by the investigation, which, according to the Commission, is precisely the position
         in this case. The Commission’s argument is therefore incapable of removing the ambiguity created, because the examination
         of the Livretbleu’s effects on trade in 1975 is set out in the contested decision in relation to the classification as aid of the measures adopted
         in 1975.
         
         
         
         83
            
          Next, the obligation to reply to the complainants cannot force the Commission to take the approach it followed. While the
         complaints made to the Commission covered the measures adopted in 1975, and it was therefore bound to investigate them, nothing
         required it to find that those measures were capable of affecting trade, if it considered that they could not be classified
         as aid for other reasons.
         
         
         
         84
            
          Finally, as regards the consequences to be drawn from Alzetta and Others  v Commission (paragraph 65 above), the Commission correctly observes that it is obliged, in order to determine whether aid granted in the
         context of an aid scheme is to be treated as existing or new, to determine whether, when that scheme was established, the
         market concerned was open to competition or not. That explanation confirms the impression that, according to the contested
         decision, the aid scheme investigated was established in 1975.
         
         
         
         85
            
          Secondly, the consideration of the consequences of the liberalisation of the banking sector in recitals 85 to 89 in the contested
         decision leads to the finding that ‘the effect on trade of aid granted to a banking establishment became extremely serious’
         from 1990. Although the brokerage commission is not mentioned in recitals 85 to 89, they can be understood as intended to
         demonstrate that that measure could have a considerable effect on trade. That analysis sheds no light on the point whether,
         apart from the brokerage commission, other measures were taken into consideration as giving rise to the aid at issue.
         
         
         
         86
            
          Thirdly, the explanations in recitals 90 and 91 in the contested decision, concerning Crédit mutuel’s position on the French
         banking market, are intended to refute the argument that the limited local competence of Crédit mutuel’s local branches precludes
         the aid having any impact on trade, and also contain some succinct findings as regards the distortion of competition, the
         Commission stating particularly:
         ‘Crédit mutuel is a going concern … . Any excess compensation for the net cost of collecting and managing general economic
         interest tasks would enable it to increase its profit and to accumulate additional own funds. The constraint of solvency …
         laid down in the European banking rules introduces an obligation which limits the growth capacity of credit institutions.
         Any operating aid represents a considerable lever in overcoming these constraints, in that it increases own funds. Because
         of these constraints on solvency, it is easier to ascertain that a distortion of competition has taken place in the case of
         aid granted to credit institutions. If the direct or indirect effect of the aid is to increase own funds, then a distortion
         of competition can be reflected in the increased activity of the bank.’
         
         
         
         87
            
          Recitals 90 and 91 in the contested decision do not therefore rule, definitively, on the existence of distortion of competition
         in this case, but confine themselves to providing some details as regards the assessment criteria which the Commission intends
         to use. That passage does not enable it to be determined whether, apart from the brokerage commission, other measures could
         have contributed, according to the contested decision, to excess compensation for the costs of collection and management,
         to an increase in its own funds and, thereby, to distortion of competition.
         
         
         
         88
            
          Finally, the conclusion of those explanations, in recital 92 in the contested decision (reproduced in paragraph 17 above),
         uses some particularly vague terms in relation to the identification of the aid, referring to ‘potential aid granted to Crédit
         mutuel as operating aid’ and declaring that ‘the potential aid was new when introduced in 1975’. The brokerage commission
         is not even mentioned in that conclusion.
         
         
         
         89
            
          While paragraph 92 in the contested decision describes the aid whose effects are being assessed as ‘potential’, it must be
         observed that that description is omitted when it is a question, in recital 130 in the contested decision, of the ‘legal analysis
         of the nature of the aid granted in the context of the Livretbleu’. Nevertheless, the Commission maintains that ‘there was new aid since the end of 1975’. The Commission also finds, admittedly,
         that the amount of that aid cannot be calculated for the period prior to 1991. That does not necessarily mean that, according
         to the contested decision, there was no aid before 1991. The terms used show, rather, that the Commission could have found
         that there were already prior to 1991 measures capable of constituting aid, but that it declined to calculate the amount thereof.
         
         
         
         90
            
          By attributing, at the hearing, the omission of the adjective ‘potential’ in recital 130 in the contested decision to an effort
         to be succinct and to considerations of ‘pure material contingency’, the Commission merely acknowledges that the drafting
         of the contested decision reveals weaknesses, without disposing of the uncertainties as to the content of that decision which
         result therefrom.
         
         
         
         91
            
          It follows that the analysis in the contested decision of the distortion of competition and of the effect on trade does not
         permit a clear determination as to which of the measures forming part of the Livretbleu system are regarded in the contested decision as having an effect on trade and creating distortion of competition.
         
         
         – Analysis of State resources
         
         
         92
            
          Secondly, the Commission examined in recitals 93 to 99 in the contested decision the question of the State resources by means
         of which the aid in question was, in its view, granted. It must be said that the reasoning followed in the contested decision
         in that regard is neither clear nor exhaustive. 
         
         
         
         93
            
          In recital 94 in the contested decision, the Commission announces the following plan:
         ‘[It] must check … to see from which State resources Crédit mutuel may have benefited: (1) the tax advantage accorded to savers,
         (2) the fund collection commission ..., (3) the revenue from the [other GIA], (4) the possible advantages and costs indirectly
         linked to the Livretbleu system.’
         
         
         
         94
            
          As regards, first, the tax exemption, the contested decision states that the system involves the use of State resources and
         the adoption of a more favourable regime for the saver compared to the usual situation, and that it carries a cost for the
         State. It continues in recital 96 in the contested decision:
         ‘This aid appears to benefit individual consumers directly and not the bank, therefore it cannot be said that Crédit mutuel
         is the direct beneficiary of the tax aid. However, this tax aid, having a social character, is associated with a product distributed
         by only one player, Crédit mutuel. Therefore the aid does not satisfy the condition of compatibility laid down in Article
         87(2)(a) [EC], which requires that aid is granted “without discrimination related to the origin of the products concerned”.’
         
         
         
         95
            
          That analysis does not enable it to be determined clearly whether the Commission considered that the tax exemption is capable
         of constituting a transfer of State resources to Crédit mutuel. Such an interpretation of the contested decision cannot however
         be excluded, given that it is not necessary, in order to found a finding of the existence of intervention by means of State
         resources in favour of an undertaking, that the undertaking must be the direct recipient. It follows from Article 87(2)(a)
         EC that aid having a social character granted to individual consumers is capable of coming within the scope of Article 87(1)
         EC. Likewise, the fact that a Member State renounces tax revenue may involve an indirect transfer of State resources, capable
         of being treated as aid to economic operators other than those to which the tax advantage is accorded directly (Case C-156/98
         Germany v Commission [2000] ECR I-6857, paragraphs 24 to 28).
         
         
         
         96
            
          The contested decision is, therefore, ambiguous in relation to the treatment of the tax exemption in the light of the criterion
         of State resources.
         
         
         
         97
            
          Secondly, the Commission considers the ‘general interest service entrusted to Crédit mutuel’ and states in recital 98 in the
         contested decision:
         ‘Crédit mutuel was entrusted with the task of distributing the Livretbleu, a task to which strict prerogatives and constraints pertained. The prerogatives consisted of the exclusive distribution
         of the Livretbleu and the payment of [the] fund collection commission ... . The obligations concern the use of the funds collected through
         the Livretbleu. These obligations changed over time ... . All the saving funds are now transferred to CDC. The latter pays Crédit mutuel
         a commission corresponding to the gross interest rate fixed by the authorities passed on to savers, plus an intermediation
         commission of 1.3 %. Since CDC is a public enterprise that receives State resources to perform general interest tasks, the
         fund collection commission must be regarded as a State resource. The interest is paid to the savers, hence Crédit mutual receives
         this commission only. The commission forms an integral part of the public service entrusted to Crédit mutuel, and is therefore
         attributable to the State.’
         
         
         
         98
            
          The fund collection (brokerage) commission is therefore clearly treated as a State resource.
         
         
         
         99
            
          Thirdly, regarding the income from the other GIA, the Commission declares in recital 99 in the contested decision:
         ‘Based on the information received, the compulsory nature of these assets combined with the fact that the rates had been regulated
         by the State and were not freely determined by the market means that there are grounds for considering that the [other] general
         interest assets form an integral part of the Livretbleu system. It will be demonstrated below that these compulsory conditions enabled Crédit mutuel to achieve very considerable
         profits on these funds. The definition of [those GIA] was amended in the Decree of 27 September 1991: the assets covered are
         now exclusively loans to finance social housing and the allocation to the CDC ... . But it was only very slowly during the
         1990s that these new tasks replaced the old ones: only the new funds collected were immediately fully allocated to these new
         tasks as of 1991.’
         
         
         
         100
            
          It is clear from the above that the Commission is not explicitly treating the income from the other GIA as State resources.
         Such treatment does not however appear to be excluded. The meaning, in this context, of the statement that ‘the [other] GIA
         form an integral part of the Livretbleu system’ is not clear, in light of the fact that a similar statement had been made, in recital 98 in the contested decision,
         in order to justify the statement that the brokerage commission was attributable to the State (see paragraph 98 above).
         
         
         
         101
            
          Therefore, the result of the examination, in the contested decision, of the question whether the income drawn by Crédit mutuel
         from the management of the other GIA amounts to a transfer of State resources is also ambiguous.
         
         
         
         102
            
          As regards, fourthly, the examination of the possible advantages and costs indirectly linked to the Livretbleu system, announced in recital 94 in the contested decision, it must be stated that it was not carried out in that part of
         the decision. By contrast, certain explanations concerning the indirect advantages and costs of the Livretbleu system appear, on the one hand, in the part devoted to the assessment of the amount of the State aid, particularly in recitals
         119 to 127, where the Commission considers the possible ‘loss-leader effect’ of the Livretbleu, and, on the other hand, in the part devoted to the compatibility of the aid with the Treaty, particularly in recitals 190
         to 194 regarding the question whether Crédit mutuel was obliged to maintain branches in rural areas. However, no assessment
         of the possible indirect advantages in the light of the condition of State resources is made.
         
         
         
         103
            
          In brief, it must be held that, while the analysis of the question of State resources by the contested decision is clear in
         relation to the brokerage commission, it is ambiguous in relation to the treatment of the tax exemption and of the income
         from the other GIA and incomplete in relation to the other advantages, the examination of which was envisaged by the Commission.
         
         
         – Analysis of the competitive advantage
         
         
         104
            
          Subsection V.3 of the contested decision, entitled ‘The competitive advantage’, contains only recital 100, reproduced in paragraph
         18 above. 
         
         
         
         105
            
          That subsection of the contested decision is confined to stating the criterion which the Commission intends to apply to determine
         whether a competitive advantage can be established in the case and, thus, whether the third and fourth conditions of Article
         87(1) EC, set out in paragraph 77 above, are satisfied. That criterion is defined, in recital 100 in the contested decision,
         in relation only to the brokerage commission and makes no mention of any of the other measures forming part of the Livretbleu system. 
         
         
         
         106
            
          The analysis of those two conditions, concerning, first, the advantage conferred on the recipient and, second, the point whether
         the measure under consideration distorts or threatens to distort competition appears also in Subsection V.4 of the contested
         decision, entitled ‘Assessment of the amount of State aid’, containing recitals 101 to 181. Those explanations are, also,
         hardly clear on the point whether the payment of the brokerage commission is the only measure taken into account which was
         regarded as having conferred a competitive advantage on Crédit mutuel or whether other measures adopted in the context of
         the Livretbleu system also played a role.
         
         
         
         107
            
          The Commission first defines the ‘procedures for taking into account all income and expenditure linked to the total Livretbleu funds’ and states in that regard in recital 103 in the contested decision:
         ‘The financial mechanism relating to the Crédit mutuel Livretbleu system must be assessed from the point of view of the overall economy of this savings system, in other words account must
         be taken of all the costs and benefits arising from the system, in particular the benefits drawn directly from the use of
         the funds collected from the distribution of a tax-free savings product of this kind.’
         
         
         
         108
            
          That wording creates the impression that the tax exoneration of the Livretbleu was taken into consideration to determine whether that mechanism bestowed an advantage on Crédit mutuel.
         
         
         
         109
            
          The impression that the tax exoneration was taken into consideration is confirmed by recital 108, according to which ‘[t]he
         Livretbleu deposits have enabled Crédit mutuel to obtain resources under more advantageous conditions than would have been possible
         if it had simply obtained refinancing on the financial markets’. In addition, in recital 111, the Commission points out that
         the ‘costs of the resources’ from the Livretbleu are ‘different from [the] normal market costs’. Recital 117 mentions the ‘special features associated with this way of collecting
         funds’. Similarly, recital 175 justifies taking into consideration the assets chosen by Crédit mutuel, because they are ‘back-to-back
         to a specific resource, the deposits collected thanks to the monopoly over distributing the Livretbleu’. The same recital also observes that, ‘[i]n competitive conditions, it is likely that Crédit mutuel would not have been
         able to obtain this resource at the same price’.
         
         
         
         110
            
          The passages cited are ambiguous as regards the definition of the measure or measures giving rise to the competitive advantage
         conferred on Crédit mutuel.
         
         
         
         111
            
          The Commission’s explanation that it is important to distinguish the concept of ‘competitive advantage resulting from an excess
         compensation of the costs caused by the performance of a general economic interest task’ from the concept of ‘financial advantages’
         taken into account for the overall balance of the Livretbleu intended to establish whether there is excess compensation does not afford the necessary clarification.
         
         
         
         112
            
          Admittedly, several passages of the contested decision dealing with advantages, particularly recitals 106, 107, 180 and 198,
         can be understood as referring to the economic advantage taken into consideration for the purposes of the overall balance.
         On the other hand, where it indicates, on several occasions, particularly in recitals 108, 111 and 175, that Crédit mutuel
         obtained resources in conditions more favourable than market conditions, the contested decision alludes to a competitive advantage
         arising from the Livretbleu system and not only to an economic advantage to be taken into consideration for the purposes of the overall balance of that
         system.
         
         
         
         113
            
          The Commission stated in that respect, at the hearing, that it did not draw any legal consequences from elements other than
         the brokerage commission. However, assuming that to be correct, mentioning at several points of the contested decision ‘advantages’
         which, in the end, are not taken into consideration for the purposes of identifying the aid, without explicitly so stating,
         creates confusion which makes understanding the contested decision on that point even more difficult.
         
         
         
         114
            
          In addition, the argument that the brokerage commission alone was taken into consideration is hardly compatible with the examination
         carried out, in recitals 119 to 127 in the contested decision, of the ‘loss-leader effect’ inherent in the Livretbleu system and invoked by the complainants. According to them, the exclusive right to distribute a savings product which is attractive
         because it is tax-free is capable of enabling Crédit mutuel to attract and retain a clientele, to which the network is then
         in a position to suggest other banking products and services. The Commission explained in recitals 126 and 127 in the contested
         decision that it did not rely on that effect for the purposes of the contested decision because it was not possible to evaluate
         precisely its financial impact. That ‘effect’ of the Livretbleu has no connection with the payment of the brokerage commission, however, but is connected solely to the right to distribute
         a tax-free savings product. The examination of such effect helps therefore to create the impression that the exclusive right
         and the tax exoneration count among the measures amounting to the aid established by the contested decision. Admittedly, the
         Commission was bound to reply to the complainants’ arguments thereon and it was inevitable, for that purpose, that it would
         rule on measures other than the brokerage commission. However, in order to avoid the contested decision being understood as
         meaning that it treats those measures as having contributed to the grant of the offending aid, there was even greater need
         for the Commission to indicate clearly that the brokerage commission alone was regarded as having conferred the aid, if such
         was effectively its position.
         
         
         
         115
            
          The impression that the brokerage commission was not the only measure taken into consideration in respect of the aid bestowed
         on Crédit mutuel is also reinforced by the result of the assessment of the amount of State aid in Subsection V.4 of the contested
         decision. It is instructive in that regard to add to the table of the results of the Livretbleu’s profit and loss account, reproduced in paragraph 21 above, the data relating to the brokerage commission, provided by the
         parties in reply to the Court’s questions:
         
         
         Year
                  
               
               1991
                  
               
               1992
                  
               
               1993
                  
               
               1994
                  
               
               1995
                  
               
               1996
                  
               
               1997
                  
               
               1998
                  
               
               Total
                  
               
            Brokerage commission
                  
               
               10
                  
               
               60
                  
               
               110
                  
               
               240
                  
               
               390
                  
               
               490
                  
               
               540
                  
               
               780
                  
               
               2 620
                  
               
            Savings funds
                  
               
               ... 2  –Confidential data omitted.
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               -399
                  
               
            [Other] GIA
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               2 592
                  
               
            Non-GIA
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               ...
                  
               
               -1 119
                  
               
            Total margin before tax
                  
               
               1 096
                  
               
               505
                  
               
               301
                  
               
               -471
                  
               
               -135
                  
               
               -87
                  
               
               -156
                  
               
               20
                  
               
               1 074
                  
               
            
         116
            
          That table confirms the applicant’s argument that the amount of the aid established in the contested decision is explained
         essentially by taking into consideration the profits made by Crédit mutuel between 1991 and 1993, at a time when the brokerage
         commission did not yet contribute significantly to the results of the management of the Livretbleu, whereas the profits of the Livretbleu system arose essentially from revenue derived from the other GIA.
         
         
         
         117
            
          The disproportion between the amount of the aid relating to those years and the amount of the brokerage commission paid during
         the same period is striking and seems difficult to justify, at first sight, if the aid arises effectively from the payment
         of that commission alone without any of the measures previously adopted in the context of the Livretbleu being taken into account in that respect. In those circumstances, the analysis of the competitive advantage as set forth
         in the contested decision does not support the Commission’s argument that the brokerage commission alone was treated as aid.
         
         
         
         118
            
          As a result, given that the Commission did not clearly express, in the contested decision, its position on the identification
         of the measures which conferred the aid in question on Crédit mutuel, the Court is not in a position to exercise its power
         to review the appraisal of the Livretbleu system by the contested decision.
         
         
         
         119
            
          Finally, the Commission’s reasoning in the contested decision cannot exclude the possibility, raised by the applicant, that
         the contested decision covers, in essence, two potential aids, granted in 1975 and 1991 respectively, without clearly distinguishing
         them in its analysis.
         
         
         
         120
            
          It is appropriate to add that the Commission could not take into account, in its analysis, certain clarification given by
         the Court of Justice after the adoption of the contested decision, regarding State measures intended to compensate for expenditure
         connected to the performance of public service tasks, particularly in Altmark Trans and Regierungspräsidium Magdeburg (see paragraph 77 above). While certain weaknesses in setting out the reasoning adopted in the contested decision can be
         explained by the fact that the Commission had not had the advantage, at the date of adoption of the contested decision, of
         the lessons of that case, it was nevertheless necessary, in view of the complexity of this file, that the Commission’s reasoning
         be set out with particular clarity in relation to the identification and evaluation of the measures which conferred the aid
         in question on Crédit mutuel.
         
         
         
         121
            
          It follows from the foregoing analysis that the reasoning followed in the contested decision, as a whole, does not enable
         it to be determined whether or not the Commission considered, as measures which granted the aid in question to Crédit mutuel,
         in addition to the brokerage commission, the tax exoneration, the exclusive distribution right and the conditions of remuneration
         of the other GIA. 
         
         
         
         122
            
          It follows that the contested decision did not state sufficient reasons in regard to the identification of the measures treated
         as aid. 
         
         
         
         123
            
          The Commission stated in the course of these proceedings that, according to the contested decision, the brokerage commission
         alone gave rise to the aid in question. However, such reasoning, developed by the Commission’s agents before the Court, does
         not appear in the contested decision and is contradicted by numerous passages in the grounds thereof, analysed above.
         
         
         
         124
            
          As the Court of Justice ruled in Case C‑137/92 P Commission v BASF and Others [1994] ECR I‑2555, paragraphs 66 to 68, the operative part and the statement of reasons of a decision – which must be reasoned
         under Article 253 EC – constitute an indivisible whole, with the result that it is for the College of Commissioners alone,
         in accordance with the principle of collegiate responsibility, to adopt both the one and the other, any alternation to the
         statement of reasons going beyond simple corrections of spelling or grammar being the exclusive province of that college.
         
         
         
         
         125
            
          Those considerations founded on the principle of collegiate responsibility are equally relevant to the contested decision,
         which also had to be reasoned pursuant to Article 253 EC and by which the College of Commissioners exercised its specific
         power to rule on the compatibility of State aid with the common market which was conferred on it by Article 88 EC.
         
         
         
         126
            
          It follows that the arguments presented by the Commission’s agents before the Court cannot make good the insufficiency of
         the contested decision’s reasoning (see, to that effect, Joined Cases C‑329/93, C-62/95 and C-63/95 Germany and Others  v Commission [1996] ECR I‑5151, paragraphs 47 and 48, and Joined Cases T-371/94 and T-394/94 British Airways and Others  v Commission [1998] ECR II‑2405, paragraphs 116 to 119).
         
         
         
         127
            
          It follows that the contested decision must be annulled, without the need to decide upon the other pleas in law invoked by
         the applicant.
         
         
         Costs
         128
            
          Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been
         applied for in the other party’s pleadings. Since the applicant has applied for costs and the defendant has been unsuccessful,
         the latter must be ordered to bear its own costs and to pay the costs incurred by the applicant.
         
         
         
         129
            
          The French Republic must bear its own costs, in accordance with the first subparagraph of Article 87(4) of the Rules of Procedure.
         
         
         On those grounds,
         
         
         
            
            THE COURT OF FIRST INSTANCE (Second Chamber, Extended Composition)
         
         
          hereby:
         
            
            
             
               1.
                  Annuls Commission Decision 2003/216 EC of 15 January 2002 on State aid granted by the French Republic to Crédit mutuel;
               
            
            
            
             
               2.
                  Orders the Commission to bear its own costs and to pay the applicant’s costs;
               
            
            
            
             
               3.
                  Orders the French Republic to bear its own costs.
               
            
            
                  Pirrung
               
               
                  Tiili
               
               
                  Meij
               
            
                  Vilaras
               
               
                  
               
               
                  Forwood
               
            
                  
               
               
                  
               
               
                  
               
            
                  
               
               
                  
               
               
                  
               
            
                  
               
               
                  
               
               
                  
               
            
            
            
            
            
            
            
            
         
         
          Delivered in open court in Luxembourg on 18 January 2005.
         
         
         
         
                  H. Jung
               
               
                  J. Pirrung
               
            
         
         
         
                  Registrar
               
               
                  President
               
            
         
            Table of contents
         
         
                  Background to the dispute
                     
               
            
                      
                        Crédit Mutuel
                     
               
            
                      
                        Livret bleu
                     
               
            
                      
                        Administrative procedure
                     
               
            
                      
                        Contested decision
                     
               
            
                  Procedure and forms of order sought by the parties
                     
               
            
                  Law
                     
               
            
                      
                        Preliminary observations
                     
               
            
                      
                        The contested decision’s reasoning with regard to the identification of the aid
                     
               
            
                          
                        Arguments of the parties
                     
               
            
                              
                        – The identification of the measure which conferred an advantage
                     
               
            
                              
                        – The identification of the State resources
                     
               
            
                              
                        – The treatment of the Livret bleu system as new aid when it was established in 1975
                     
               
            
                          
                        Findings of the Court
                     
               
            
                              
                        – Operative part and ‘Conclusion’ of the contested decision
                     
               
            
                              
                        – Analysis as regards the meaning of State aid
                     
               
            
                              
                        – Analysis of the distortion of competition and the effect on trade
                     
               
            
                              
                        – Analysis of State resources
                     
               
            
                              
                        – Analysis of the competitive advantage
                     
               
            
                  Costs
                     
               
            
      
          1 –
            
            Language of the case: French.
         
      2 –
         
         Confidential data omitted.
            
         
      
      3 –
         
         Confidential data omitted.