Eesti Pagar AS v Ettevõtluse Arendamise Sihtasutus and Majandus- ja Kommunikatsiooniministeerium.
Date: 2019-03-05
47


In that regard, it must be borne in mind in this regard that, in accordance with the Court’s settled case-law, in the context of the cooperation between the Court and the national courts provided for in Article 267 TFEU, it is solely for the national court before which a dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court. Consequently, where the questions referred concern the interpretation of EU law, the Court is in principle required to give a ruling (judgment of 27 June 2017, Congregación de Escuelas Pías Provincia Betania, C‑74/16, EU:C:2017:496, paragraph 24 and the case-law cited).
48


It follows that questions relating to EU law enjoy a presumption of relevance. The Court may refuse to rule on a question referred for a preliminary ruling by a national court only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (judgment of 27 June 2017, Congregación de Escuelas Pías Provincia Betania, C‑74/16, EU:C:2017:496, paragraph 25 and the case-law cited).
49


In that regard, it must be recalled that the need to provide an interpretation of EU law which will be of use to the national court makes it necessary for the national court to define the factual and legal context of the questions it is asking or, at the very least, to explain the factual circumstances on which those questions are based. Those requirements are of particular importance in the area of competition, where the factual and legal situations are often complex (judgment of 27 June 2017, Congregación de Escuelas Pías Provincia Betania, C‑74/16, EU:C:2017:496, paragraph 26 and the case-law cited).
50


In this case, first, it must be stated that the referring court has clearly defined the factual and legal context of the questions that it is asking and that it is not for the Court to verify their accuracy (see, to that effect, judgment of 20 May 2010, Ioannis Katsivardas — Nikolaos Tsitsikas, C‑160/09, EU:C:2010:293, paragraph 27).
52


Further, in accordance with the Court’s settled case-law, a rule of national law, pursuant to which courts that are not adjudicating at final instance are bound by legal rulings of a higher court, cannot take away from those courts the discretion to refer to the Court questions of interpretation of European Union law concerned by such legal rulings. The Court has held that a court which is not ruling at final instance must be free, if it considers that a higher court’s legal ruling could lead it to give a judgment contrary to European Union law, to refer to the Court questions which are of concern to it (judgment of 5 October 2010, Elchinov, C‑173/09, EU:C:2010:581, paragraph 27).
56


In that regard, it should be recalled that the notification requirement is one of the fundamental features of the system of control put in place by the FEU Treaty in the field of State aid. Within that system, Member States are under an obligation, first, to notify to the Commission each measure intended to grant new aid or alter aid for the purposes of Article 107(1) TFEU and, secondly, not to implement such a measure, in accordance with Article 108(3) TFEU, until that institution has taken a final decision on the measure (judgment of 21 July 2016, Dilly’s Wellnesshotel, C‑493/14, EU:C:2016:577, paragraphs 31 and 32 and the case-law cited).
57


In accordance with Article 109 TFEU, the Council of the European Union is authorised to make any appropriate regulations for the application of Article 107 TFEU and Article 108 TFEU and may in particular determine the conditions in which Article 108(3) TFEU is to apply and the categories of aid exempt from the procedure under that provision. In addition, as provided for in Article 108(4) TFEU, the Commission may adopt regulations relating to the categories of State aid that the Council has, pursuant to Article 109 TFEU, determined may be exempt from the procedure provided for in Article 108(3) TFEU (judgment of 21 July 2016, Dilly’s Wellnesshotel, C‑493/14, EU:C:2016:577, paragraphs 33 and 34).
58


Consequently, Regulation No 994/98, in accordance with which Regulation No 800/2008 was subsequently adopted, had itself been adopted pursuant to Article 94 of the EC Treaty (subsequently Article 89 EC and now Article 109 TFEU) (judgment of 21 July 2016, Dilly’s Wellnesshotel, C‑493/14, EU:C:2016:577, paragraph 35).
59


It follows that, notwithstanding the obligation of prior notification of each measure intended to grant or alter new aid, which is incumbent on the Member States under the Treaties and is one of the fundamental features of the system of monitoring in the field of State aid, if an aid measure adopted by a Member State fulfils the relevant conditions provided for in Regulation No 800/2008, that Member State may rely on its being exempted, as laid down in Article 3 of that regulation, from the notification requirement. Conversely, it is apparent from recital 7 of that regulation that State aid not covered by that regulation should remain subject to the notification requirement laid down in Article 108(3) TFEU (judgment of 21 July 2016, Dilly’s Wellnesshotel, C‑493/14, EU:C:2016:577, paragraph 36).
60


Further, as a qualification of the general rule that notification is required, the provisions of Regulation No 800/2008 and the conditions laid down by it must be interpreted strictly. While the Commission is authorised to adopt regulations for block exemptions of aid, with a view to ensuring efficient supervision of the competition rules concerning State aid and simplifying administration, without weakening Commission monitoring in that area, the aim of such regulations is also to increase transparency and legal certainty. Fulfilling the conditions laid down by those regulations, including, therefore, those laid down by Regulation No 800/2008 enables those aims to be fully achieved (judgment of 21 July 2016, Dilly’s Wellnesshotel, C‑493/14, EU:C:2016:577, paragraphs 37 and 38).
65


Second, it follows from, inter alia, recitals 1, 2 and 5 of Regulation No 800/2008 and from Article 3 thereof that the Commission, in essence, exercised ex ante, by adopting that regulation, all the powers conferred on it by Article 107(3) TFEU with respect to all such aid as satisfied the criteria laid down by that regulation, and only with respect to such aid.
66


In that regard, it is clear from, in particular, recital 28 and Article 8(3) and (6) of Regulation No 800/2008, that it is the duty of the national authorities to verify, before granting aid pursuant to that regulation, that the conditions, relating to whether that aid acts as an incentive for SMEs, laid down in Article 8(2) of that regulation are satisfied.
79


As argued by the Commission, that conclusion is not, however, transposable to the assessment which must be undertaken by a national authority under Article 8(2) of Regulation No 800/2008, since the Commission enjoys, in the application of Article 107(3) TFEU, wide discretion, the exercise of which involves complex economic and social assessments (judgments of 11 September 2008, Germany and Others v Kronofrance, C‑75/05 P and C 80/05 P, EU:C:2008:482, paragraph 59, and of 8 March 2016, Greece v Commission, C‑431/14 P, EU:C:2016:145, paragraph 68).
84


It must at the outset be recalled that Article 108(3) TFEU establishes a prior control of plans to grant new aid. The aim of that system of prior control is therefore that only compatible aid may be implemented. In order to achieve that aim, the implementation of planned aid is to be deferred until doubt as to its compatibility is resolved by the Commission’s final decision (judgment of 21 November 2013, Deutsche Lufthansa, C‑284/12, EU:C:2013:755, paragraphs 25 and 26 and the case-law cited).
88


In that regard, the Court has stated that the prohibition on implementation of planned aid laid down in the last sentence of Article 108(3) TFEU has direct effect and that the immediate enforceability of the prohibition on implementation referred to in that provision extends to all aid which has been implemented without being notified (see, to that effect, judgment of 21 November 2013, Deutsche Lufthansa, C‑284/12, EU:C:2013:755, paragraph 29 and the case-law cited).
89


The Court has concluded that it is the task of the national courts to ensure that all appropriate action, in accordance with their national law, to address the consequences of an infringement of the last sentence of Article 108(3) TFEU, particularly as regards both the validity of measures giving effect to the aid and the recovery of financial support granted in disregard of that provision, the essence of their task being, consequently, to adopt the appropriate measures to cure the unlawfulness of implementation of the aid, so that the aid does not remain freely available to the beneficiary until such time as the Commission’s decision is made (see, to that effect, judgment of 21 November 2013, Deutsche Lufthansa, C‑284/12, EU:C:2013:755, paragraphs 30 and 31 and the case-law cited).
90


Any provision of EU law that satisfies the conditions required to have direct effect is binding on all the authorities of the Member States, that is to say, not merely the national courts but also all administrative bodies, including decentralised authorities, and those authorities are required to apply it (see, to that effect, judgment of 24 May 2012, Amia, C‑97/11, EU:C:2012:306, paragraph 38 and the case-law cited).
91


In accordance with the Court’s settled case-law, both the administrative authorities and the national courts that are called upon, within the exercise of their respective powers, to apply provisions of EU law are under a duty to give full effect to those provisions (judgment of 14 September 2017, The Trustees of the BT Pension Scheme, C‑628/15, EU:C:2017:687, paragraph 54 and the case-law cited).
92


It follows that, where a national authority finds that aid which it has granted pursuant to Regulation No 800/2008 does not satisfy the conditions laid down to qualify for the exemption provided for by that regulation, it is the duty of that authority, mutatis mutandis, to comply with the same obligations as those referred to in paragraph 89 of the present judgment, including that of recovering on its own initiative the aid that was unlawfully granted.
93


That said, taking into consideration not only the consequences that such recovery of the aid may have for the undertaking concerned but also the obligation on the Member States, laid down in the second subparagraph of Article 4(3) TEU, to take any appropriate measure, general or particular, to ensure fulfilment of the obligations arising out of the Treaties or resulting from acts of institutions of the Union, it is the duty of the national authority to which there has been submitted an aid application that may fall within the scope of Regulation No 800/2008 to examine carefully, taking account of the information submitted to it, whether the aid applied for meets all the relevant conditions laid down by that regulation and to reject that application if one of those conditions is not satisfied.
97


In accordance with the Court’s settled case-law, the right to rely on the principle of the protection of legitimate expectations presupposes that precise, unconditional and consistent assurances originating from authorised, reliable sources have been given to the person concerned by the competent authorities of the European Union. That right applies to any individual in a situation in which an EU institution, body or agency, by giving that person precise assurances, has led him to entertain well-founded expectations. Information which is precise, unconditional and consistent, in whatever form it is given, constitutes such assurances (judgment of 13 June 2013, HGA and Others v Commission, C‑630/11 P to C‑633/11 P, EU:C:2013:387, paragraph 132).
98


It is also in accordance with the Court’s settled case-law that, in view of the mandatory nature of the supervision of State aid by the Commission pursuant to Article 108 TFEU, undertakings to which aid has been granted may not, in principle, entertain a legitimate expectation that the aid is lawful unless it has been granted in compliance with the procedure laid down in that article, and furthermore, an economic operator exercising due care should normally be able to determine whether that procedure has been followed. In particular, where aid is implemented without prior notification to the Commission, with the result that it is unlawful under Article 108(3) TFEU, the recipient of the aid cannot have at that time a legitimate expectation that its grant is lawful (judgments of 15 December 2005, Unicredito Italiano, C‑148/04, EU:C:2005:774, paragraph 104, and of 19 March 2015, OTP Bank, C‑672/13, EU:C:2015:185, paragraph 77).
99


The finding has already been made, in paragraphs 59 and 87 of the present judgment, that only if an aid measure adopted by a Member State satisfies the relevant conditions laid down by Regulation No 800/2008 is that Member State exempted from its obligation to notify aid and that, conversely, the granting of aid pursuant to that regulation, although the conditions laid down for eligibility with respect to that regulation were not satisfied, was a breach of the notification requirement, and such aid must be considered to be unlawful.
100


Further, it has been stated, in paragraphs 89 to 92 of the present judgment, that, in such a situation, it is the duty of both the national courts and the administrative bodies of the Member States to ensure that all appropriate action is taken to address the consequences of an infringement of the last sentence of Article 108(3) TFEU, particularly as regards the validity of measures giving effect to the aid and the recovery of financial support granted in disregard of that provision.
101


It follows, first, that a national authority granting aid pursuant to Regulation No 800/2008 cannot be regarded as being vested with the power to adopt a final decision finding that there is no obligation to notify the aid applied for to the Commission, under Article 108(3) TFEU.
102


Since the Commission, in essence, itself exercised ex ante, by adopting Regulation No 800/2008, the powers conferred on it by Article 107(3) TFEU with respect to all such aid as satisfies the criteria laid down by that regulation, and only with respect to such aid, as stated in paragraph 65 of the present judgment, the Commission did not confer any decision-making power on the national authorities with respect to the extent of the exemption from notification, those authorities being in the same position as the potential beneficiaries of aid and being required, as was stated in paragraph 93 of the present judgment, to ensure that their decisions are in conformity with that regulation, failing which the consequences mentioned in paragraph 100 of this judgment are set in motion.
103


It follows, second, that, where a national authority grants aid while misapplying Regulation No 800/2008, its doing so is an infringement of both the provisions of that regulation and of Article 108(3) TFEU.
104


Following the Court’s settled case-law, the principle of the protection of legitimate expectations cannot be relied upon against an unambiguous provision of EU law; nor can the conduct of a national authority responsible for applying EU law, which acts in breach of that law, give rise to a legitimate expectation on the part of an economic operator of beneficial treatment contrary to EU law (judgments of 20 June 2013, Agroferm, C‑568/11, EU:C:2013:407, paragraph 52 and the case-law cited, and of 7 August 2018, Ministru kabinets, C‑120/17, EU:C:2018:638, paragraph 52).
108


In that regard, it is clear from the case-law cited in paragraph 89 of the present judgment that, where there is no EU legislation on the subject, the unlawful aid must be recovered in accordance with the rules for implementation laid down by the applicable national law.
109


In particular, contrary to what is claimed by the Estonian and Greek Governments and by the Commission, there cannot be applied to such recovery, neither directly, nor indirectly, nor by analogy, the period of 10 years specified in Article 15 of Regulation No 659/1999.
110


First, as stated by the Advocate General in points 149 and 152 of his Opinion, the Court has stated, in paragraphs 34 and 35 of the judgment of 5 October 2006, Transalpine Ölleitung in Österreich (C‑368/04, EU:C:2006:644), that, in so far as Regulation No 659/1999 contains rules of a procedural nature which apply to all administrative procedures in the matter of State aid pending before the Commission, that regulation codifies and reinforces the Commission’s practice in reviewing State aid and does not contain any provision relating to the powers and obligations of the national courts, which continue to be governed by the provisions of the Treaty as interpreted by the Court.
111


It follows from the considerations set out in paragraphs 89 to 92 of the present judgment that those findings are no less valid with respect to the powers and obligations of the national administrative authorities.
112


Second, in accordance with settled case-law, a limitation period, in general, fulfils the function of ensuring legal certainty (judgment of 13 June 2013, Unanimes and Others, C‑671/11 to C‑676/11, EU:C:2013:388, paragraph 31); in order to fulfil that function, that period must be fixed in advance, and any application ‘by analogy’ of a limitation period must be sufficiently foreseeable by a litigant (judgment of 5 May 2011, Ze Fu Fleischhandel and Vion Trading, C‑201/10 and C‑202/10, EU:C:2011:282, paragraph 32 and the case-law cited).
114


In any event, as stated by the Advocate General in point 147 of his Opinion, the mere fact that national rules on limitation are, in principle applicable to the recovery of unlawfully granted aid by national authorities on their own initiative, does not detract from the possibility of that aid being recovered subsequently, in implementation of a decision to that effect by the Commission which, where it has in its possession information on the alleged unlawfulness of that aid, whatever the source of that information, after the national limitation periods have expired, remains free to assume, within the period of 10 years referred to in Article 15 of Regulation No 659/1999, an examination of that aid.
116


By adopting Regulation No 2988/95, in particular the first subparagraph of Article 3(1) thereof, the European Union legislature decided to establish a general rule on limitation which was applicable in that area, whereby it intended, first, to define a minimum period applied in all the Member States and, secondly, to waive the possibility of bringing proceedings concerning an irregularity that is detrimental to the European Union’s financial interests after the expiry of a four-year period after the irregularity was committed (judgment of 22 December 2010, Corman, C‑131/10, EU:C:2010:825, paragraph 39 and the case-law cited).
117


It follows that, as from the date on which Regulation No 2988/95 entered into force, proceedings may be brought by the competent authorities of the Member States within a period of four years, as a rule, and other than in the sectors for which the European Union legislature has prescribed a shorter period, concerning any irregularity that is detrimental to the European Union’s financial interests. (judgment of 22 December 2010, Corman, C‑131/10, EU:C:2010:825, paragraph 40 and the case-law cited).
119


As regards more specifically the condition that the infringement of a provision of EU law must result from an act or omission by an economic operator, the Court had occasion to make clear that the rule concerning the limitation period laid down in the first subparagraph of Article 3(1) of that regulation is not intended to apply to proceedings in respect of irregularities resulting from errors on the part of the national authorities granting a financial advantage in the name of and on behalf of the European Union budget (judgment of 21 December 2011, Chambre de commerce et d’industrie de l’Indre, C‑465/10, EU:C:2011:867, paragraph 44 and the case-law cited).
121


The same is true where that authority has been informed by the beneficiary of the aid at issue of circumstances that entail the infringement of a provision of EU law; that does not, in itself, have any effect on the classification of an ‘irregularity’, within the meaning of Article 1(2) of Regulation No 2988/95 (see, to that effect, judgment of 21 December 2011, Chambre de commerce et d’industrie de l’Indre, C‑465/10, EU:C:2011:867, paragraph 48 and the case-law cited).
122


Further, the definition of an ‘irregularity’, within the meaning of Article 1(2) of Regulation No 2988/95, also covers intentional irregularities or irregularities arising out of negligence which may, in accordance with Article 5 of that regulation, result in an administrative fine, as well as those irregularities which entail nothing more than the withdrawal of the wrongly obtained advantage in accordance with Article 4 of that regulation (judgment of 24 June 2004, Handlbauer, C‑278/02, EU:C:2004:388, paragraph 33).
123


The commission of an irregularity which causes the limitation period to begin to run therefore requires two conditions to be satisfied, namely an economic operator’s act or omission that constitutes an infringement of EU law and a prejudice, or potential prejudice, caused to the budget of the European Union (judgment of 6 October 2015, Firma Ernst Kollmer Fleischimport und -export, C‑59/14, EU:C:2015:660, paragraph 24).
124


In circumstances where the infringement of EU law has been discovered after the occurrence of the prejudice, the limitation period begins to run from the time when the irregularity was committed, namely from the time when both the economic operator’s act or omission that infringed EU law and the prejudice caused to the budget of the European Union or budgets managed by it have occurred (judgment of 6 October 2015, Firma Ernst Kollmer Fleischimport und -export, C‑59/14, EU:C:2015:660, paragraph 25).
126


In that regard, it is clear from the wording of the third subparagraph of Article 3(1) of Regulation No 2988/95 that the concept of a ‘person in question’ designates the economic operator suspected of having committed the irregularities, that the concept of ‘act relating to investigation or legal proceedings’ means any act which sets out with sufficient precision the transactions to which the suspicions of irregularities relate, and that, therefore, the condition specified in that provision must be regarded as satisfied where a set of facts taken as a whole lead to the conclusion that the person in question has effectively been made aware of those acts relating to investigation or legal proceedings (see, to that effect, judgment of 11 June 2015, Pfeifer & Langen, C‑52/14, EU:C:2015:381, paragraphs 36, 38 and 43).
130


It has been stated, in paragraphs 99 and 100 of the present judgment, that, if aid has been granted pursuant to Regulation No 800/2008, although the conditions laid down for eligibility under that regulation were not satisfied, that aid must be considered to be unlawful and that, in such circumstances, it is the duty of both the national courts and the administrative bodies of the Member States to ensure that all appropriate action is taken to address the consequences of an infringement of the last sentence of Article 108(3) TFEU, particularly as regards the validity of measures giving effect to the aid and the recovery of aid granted in disregard of that provision.
131


As regards those consequences, it must be recalled that, in accordance with the Court’s settled case-law, the logical consequence of a finding that aid is unlawful is the removal of that aid by means of recovery in order to re-establish the situation previously obtaining. The main objective pursued in recovering unlawfully paid State aid is to eliminate the distortion of competition caused by the competitive advantage which such aid affords. By repaying the aid, the recipient loses the advantage which it had enjoyed over its competitors on the market, and the situation prior to payment of the aid is restored (judgment of 8 December 2011, Residex Capital IV, C‑275/10, EU:C:2011:814, paragraphs 33 and 34).
132


That said, from the aid recipient’s point of view, the undue advantage will also have consisted in the non-payment of the interest which it would have paid on the aid amount in question, had it had to borrow that amount on the market during the period of the unlawfulness, and in the improvement of its competitive position as against the other operators in the market while the unlawfulness lasts (see, to that effect, judgment of 12 February 2008, CELF et ministre dela Culture et de la Communication, C‑199/06, EU:C:2008:79, paragraph 51).
133


Therefore, in circumstances such as those in the main proceedings, and without prejudice to the applicable rules on limitation, a measure which was to comprise solely an obligation to effect recovery without interest would not be an adequate remedy for the effects of the unlawfulness, since it would not restore the situation previously obtained and would not eliminate entirely the distortion of competition (see, to that effect, judgments of 12 February 2008, CELF et ministre de la Culture et de la Communication, C‑199/06, EU:C:2008:79, paragraphs 52 to 54, and of 8 December 2011, Residex Capital IV, C‑275/10, EU:C:2011:814, paragraphs 33 and 34).
134


A national authority is therefore bound, under Article 108(3) TFEU, to order the beneficiary of the aid to pay interest in respect of the period of unlawfulness (see, to that effect, judgments of 12 February 2008, CELF et ministre de la Culture et de la Communication, C‑199/06, EU:C:2008:79, paragraph 52, and of 8 December 2011, Residex Capital IV, C‑275/10, EU:C:2011:814, paragraphs 33 to 35).
137


That said, in accordance with the Court’s settled case-law, the applicable national legislation must not be less favourable than that governing similar domestic situations (the principle of equivalence) and must not be framed in such a way as to make it in practice impossible or excessively difficult to exercise the rights conferred by EU law (the principle of effectiveness) (judgment of 11 November 2015, Klausner Holz Niedersachsen, C‑505/14, EU:C:2015:742, paragraph 40).
138


As regards the principle of effectiveness, the Court has previously held that every case in which the question arises as to whether a national procedural provision makes the application of EU law impossible or excessively difficult must be analysed by reference to the role of that provision in the procedure, its progress and its special features, viewed as a whole, before the various national bodies (judgment of 11 November 2015, Klausner Holz Niedersachsen, C‑505/14, EU:C:2015:742, paragraph 41).
139


In that regard, it must be held that the application of national law cannot have the consequence of frustrating the application of EU law in making it impossible for the national courts or authorities to satisfy their obligation to ensure compliance with the third sentence of Article 108(3) TFEU (see, to that effect, judgment of 11 November 2015, Klausner Holz Niedersachsen, C‑505/14, EU:C:2015:742, paragraphs 42 and 45).
140


A national rule that would prevent a national judge or a national authority from taking action to respond to the consequences of an infringement of the third sentence of Article 108(3) TFEU must be regarded as being incompatible with the principle of effectiveness (see, to that effect, judgment of 11 November 2015, Klausner Holz Niedersachsen, C‑505/14, EU:C:2015:742, paragraphs 42 and 45).