CELEX: C1996/336/62
Language: en
Date: 1996-11-09 00:00:00
Title: Action brought on 26 August 1996 by Freistaat Sachsen against the Commission of the European Communities (Case T-132/96)

9 . 11 . 96           EN                    Official Journal of the European Communities                                   No C 336/29
19 September 1996, the operative part of which is as                   question was necessary in order to compensate for the
follows :                                                              disadvantages caused by the division of Germany. Instead, it
                                                                       merely addressed the question whether the criteria for
1 . the application for interim relief is dismissed;                   applying Article 92 ( 3 ) were fulfilled . Since the Commission
                                                                       has a discretion in the adoption of decisions under
2.   the costs are reserved.                                           Article 92 ( 3 ), but not under Article 92 ( 2 ), it should have
                                                                       approached the matter from the opposite standpoint, and
                                                                       should initially have applied Article 92 ( 2 ) ( c ). In failing to
                                                                       do so , it infringed the EC Treaty . The considerations relating
                                                                       to capacity which the Commission applied were
                                                                       misconceived in law and in fact; from a legal standpoint, the
                                                                       application of Article 92 ( 2 ) ( c ) of the Treaty does not
Action brought on 26 August 1996 by Freistaat Sachsen
                                                                       depend on whether the aid gave rise to overcapacity, and
  against the Commission of the European Communities
                                                                       from a factual standpoint that was not the case .
                       ( Case T-132/96 )
                         ( 96/C 336/62 )                               The Commission did not interpret Article 92 ( 2 ) ( c );
                                                                       moreover, as is apparent from the grounds of its decision , it
               (Language of the case: German)                          took the view that the present case did not concern 'regional
                                                                       aid for new investment projects'. Since the Commission thus
                                                                       failed to provide reasons for its decision, the action must
An action against the Commission of the European                       also succeed on the ground of infringement of essential
Communities was brought before the Court of First                      procedural requirements .
Instance of the European Communities on 26 August 1996
by Freistaat Sachsen, Dresden, represented by Karl Pfeiffer
and Joachim Sedemund, Rechtsanwalte, of Messrs Deringer                In addition , the Commission misapplied Article 92 ( 3 ).
Tessin Herrmann & Sedemund , Berlin, with an address for               Above all , the Commission erred in law in founding its
service in Luxembourg at the Chambers of Aloyse May, 31                decision on Article 92 ( 3 ) ( a ) and ( c ) as a whole , without
Grand-Rue .                                                            explaining which of those two completely different and
                                                                       mutually exclusive provisions it was seeking to apply . In
                                                                       fact, the only one of those provisions which could possibly
The applicant claims that the Court should :                           have been applicable was Article 92 ( 3 ) ( a ), which could not
                                                                       have served to justify the Commission 's findings . In that
— annul Article 2 of the decision of the Commission of                 regard also , therefore, the Commission infringed both the
     26 June 1996 on aid granted by Germany to the                     Treaty and its obligation to provide a statement of
     Volkswagen Group for the plants in Mosel and                      reasons .
     Chemnitz ( reference No C 62/91 ex NN 75 , 77, 78 and
     79/91 ),
                                                                       The Commission wrongly based its decision in addition on
                                                                       the Community framework provisions for the motor
— order the Commission to pay the costs .                              industry in order to substantiate the different treatment
                                                                       afforded to       new investments     and to investments in
Pleas in law and main arguments adduced in support:                    expansion . The Community framework provisions do not
                                                                       lay down different rules for the two forms of investment,
The action is directed against a decision of the Commission            and there is no basis in the applicable Community legislation
of 26 June 1996 addressed to the Government of the Federal             for the Commission 's administrative practice of making
Republic of Germany, refusing approval of significant parts            such distinctions from time to time .
of the aid in question, for which provision has been made ,
pursuant to rules of German law approved by the                        Lastly, the contested decision is also wrong because, when
Commission, with regard to factories in the Freistaat                  the German authorities approved the aid, the Community
Sachsen ( Free State of Saxony ) owned by the Volkswagen               framework provisions for the motor industry had already
Group . The Commission refused to authorize such aid ,                 expired but had not yet been renewed . The same also applies
amounting to approximately DM 240 million , on the                     to the Commission 's decision whereby the Community
ground that Article 92 ( 2 ) (c ) of the EC Treaty, which allows       framework provisions were extended to cover Germany,
aid to be granted in order to compensate for the                       despite the fact that the German Government had not given
disadvantages caused by the division of Germany, is not                its consent thereto . Since the German aid rules had been
applicable and that Article 92 ( 3 ) of the Treaty does not            approved by the Commission and the Commission had not
permit grants of aid amounting to more than the sums                   raised any objection regarding the correct application of
approved by it.                                                        those rules, there was no need for any specific notification of
                                                                       the German aid decision in March 1991 , and there was no
The applicant considers that the Commission erred in failing           justification for the initiation by the Commission of a
to apply Article 92 ( 2 ) ( c ) of the EC Treaty to the factual        proceeding under Article 93 ( 3 ) or for its adoption of the
situation requiring to be assessed in the present case . That          contested decision . On that ground also , the decision should
provision - has mandatory force in law and is therefore                be annulled .
applicable in every case where the factual criteria set out in
its wording are fulfilled . The Commission did not examine
whether that was the case — that is to say, whether the aid in