European Commission v Hellenic Republic.
Date: 2018-11-14
68


As a preliminary point, it must be recalled that it is clear from the case-law of the Court that the Member State to which a decision requiring recovery of unlawful aid declared incompatible with the internal market is addressed is obliged under Article 288 TFEU to take all measures necessary to ensure implementation of that decision. It must succeed in actually recovering the sums owed in order to eliminate the distortion of competition caused by the anticompetitive advantage procured by that aid (judgment of 9 November 2017, Commission v Greece, C‑481/16, not published, EU:C:2017:845, paragraph 23).
69


The recovery of unlawful aid declared incompatible with the internal market must be effected without delay and in accordance with the procedures under the national law of the Member State concerned, provided that they allow the immediate and effective execution of the Commission’s decision. To this effect, the Member States concerned are required to take all necessary steps which are available in their respective legal systems, including provisional measures, without prejudice to EU law (see, to that effect, judgment of 9 November 2017, Commission v Greece, C‑481/16, not published, EU:C:2017:845, paragraph 24).
70


As regards situations in which unlawfully paid State aid must be recovered from the recipient companies which are in difficulty or are bankrupt, it must be recalled that such difficulties do not affect the obligation to recover the aid. The Member State is therefore required, as the case may be, to bring about the winding-up of that company, to have its claim registered as one of that company’s liabilities or to take any other measure enabling the aid to be recovered (judgment of 17 January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph 36).
73


Concerning infringement proceedings under Article 260(2) TFEU, the reference date which must be used for assessing whether there has been a failure to fulfil obligations is that of the expiry of the period prescribed in the letter of formal notice issued under that provision (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 32).
107


As a preliminary point, it should be recalled that, in each case, it is for the Court to determine, in the light of the circumstances of the case before it and according to the degree of persuasion and deterrence which appears to it to be required, the financial penalties appropriate, in particular, for preventing the recurrence of similar infringements of EU law (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 63).
108


According to settled case-law, the imposition of a penalty payment is, in principle, justified only in so far as the failure to comply with an earlier judgment of the Court continues up to the time of the Court’s examination of the facts (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 64).
112


In any event, the entry in the schedule of liabilities of the claims relating to the recovery of the aid concerned is not sufficient in itself to satisfy the obligation to implement the judgment establishing the failure to fulfil obligations (judgment of 11 December 2012, Commission v Spain, C‑610/10, EU:C:2012:781, paragraph 103). Such a registration is regarded as being, in principle, an appropriate measure capable of ensuring the elimination of the distortion of competition, provided that such a measure is followed either by the recovery of the full amount of that aid or by the winding-up of the undertaking and the definitive cessation of its activities, if such recovery remains impossible throughout the insolvency proceedings (judgment of 17 January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph 42).
113


In the second place, as regards the argument concerning the surrender of the possession of the land designated ABK 266, it suffices to state that, in any event, that represents only partial implementation of the recovery obligation. That transfer does not, in itself, ensure the full recovery of the State aid concerned or compliance with the commitments set out in the letter of 1 December 2010.
114


Therefore, the Hellenic Republic cannot claim that, on the date of the examination of the facts by the Court, it had taken all the measures necessary for the purpose of implementing the judgment establishing the failure to fulfil obligations.
117


According to settled case-law, the penalty payment must be decided upon according to the degree of persuasion needed in order for the Member State which has failed to comply with a judgment establishing a breach of obligations to alter its conduct and bring to an end the infringement established (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 68).
118


In exercising its discretion in the matter, it is for the Court to set the penalty payment so that it is both appropriate to the circumstances and proportionate to the infringement established and the ability to pay of the Member State concerned (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 69).
119


The Commission’s proposals regarding the penalty payment cannot bind the Court and are merely a useful point of reference. Similarly, guidelines such as those set out in the communications of the Commission are not binding on the Court but contribute to ensuring that the Commission’s own actions are transparent, foreseeable and consistent with legal certainty when that institution makes proposals to the Court. In proceedings under Article 260(2) TFEU relating to a failure to fulfil obligations on the part of a Member State that has persisted notwithstanding the fact that that same failure to fulfil obligations has already been established in a first judgment delivered under Article 258 TFEU or Article 108(2) TFEU, the Court must remain free to set the penalty payment to be imposed in an amount and in a form that the Court considers appropriate for the purposes of inducing that Member State to bring to an end its failure to comply with the obligations arising under that first judgment of the Court (see, to that effect, judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 70).
120


For the purposes of determining the amount of a penalty payment, the basic criteria which must be taken into consideration in order to ensure that that payment has coercive effect and that EU law is applied uniformly and effectively are, in principle, the seriousness of the infringement, its duration and the ability to pay of the Member State in question. In applying those criteria, regard must be had, in particular, to the effects on public and private interests of the failure to comply and to how urgent it is for the Member State concerned to be induced to fulfil its obligations (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 71).
121


In the first place, as regards the seriousness of the infringement, as the Advocate General observed in point 124 of his Opinion, the fundamental nature of the provisions of the Treaty on State aid should be recalled.
123


The importance of the EU rules infringed in a case such as this is reflected, in particular, in the fact that repayment of aid declared unlawful and incompatible with the internal market eliminates the distortion of competition caused by the competitive advantage afforded by the aid and that, by repaying the aid, the recipient forfeits the advantage which it had enjoyed over its competitors on the market (see, to that effect, judgment of 11 December 2012, Commission v Spain, C‑610/10, EU:C:2012:781, paragraph 127).
127


Fourth, as far as concerns the argument of the Hellenic Republic that there are circumstances mitigating the seriousness of the infringement, in particular difficulties such as the obstruction and complete lack of cooperation of ENAE with regard to the implementation of the commitments set out in the letter of 1 December 2010 and the effects of the decision of the ICC Court of Arbitration of 27 June 2017, it must be recalled that, according to settled case-law, legal, political or practical difficulties encountered by the Member State concerned in implementing a decision ordering the recovery of unlawful aid, without taking genuine steps to recover the aid from the undertakings concerned and without proposing any alternative means of implementing such a decision to the Commission which would have enabled those difficulties to be overcome, cannot justify the failure by that Member State to fulfil its obligations under EU law. The same is true with regard to the alleged domestic problems encountered in the implementation of the Commission’s decision (judgment of 9 November 2017, Commission v Greece, C‑481/16, not published, EU:C:2017:845, paragraph 29). Therefore, in those circumstances, the difficulties relied on by the Hellenic Republic cannot be regarded as being mitigating circumstances in the present case.
130


In the second place, as regards the duration of the infringement, it should be recalled that that duration must be assessed by reference to the date on which the Court assesses the facts and not the date on which proceedings are brought before it by the Commission (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 78).
132


In the third place, as regards the ability to pay, and more particularly the Commission’s proposal to multiply the basic amount by a specific coefficient applicable to the Hellenic Republic, the Court has ruled on numerous occasions that that method of calculation is an appropriate means of reflecting the ability to pay of the Member State concerned while keeping the variation between Member States within a reasonable range (judgment of 7 July 2009, Commission v Greece, C‑369/07, EU:C:2009:428, paragraph 123).
133


As the Advocate General observed, in point 132 of his Opinion, the Court has consistently accepted that, in order to calculate financial penalties, account should be taken of the GDP of the Member State concerned and the number of its votes in the Council (see, to that effect, judgments of 4 July 2000, Commission v Greece, C‑387/97, EU:C:2000:356, paragraph 88; of 25 November 2003,Commission v Spain, C‑278/01, EU:C:2003:635, paragraph 59; of 10 January 2008, Commission v Portugal, C‑70/06, EU:C:2008:3, paragraph 48; and of 4 June 2009, Commission v Greece, C‑109/08, EU:C:2009:346, paragraph 42).
134


As far as concerns the GDP criterion, it is apparent from the case-law of the Court that it is necessary to take account of recent trends in that Member State’s GDP at the time of the Court’s examination of the facts (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 81 and the case-law cited).
141


Furthermore, it must be observed that, in its case-law prior to 1 April 2017, the date on which the old system of weighted votes ceased to apply, for the purposes of evaluating the ability of Member States to pay the Court only takes into account the GDP of the Member State concerned (judgments of 22 February 2018, Commission v Greece, C‑328/16, EU:C:2018:98, and of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358).
153


As a preliminary point it must be recalled that, in exercising the discretion conferred on it in such matters, the Court is empowered to impose a penalty payment and a lump sum payment cumulatively (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 96).
154


The imposition of a lump sum payment and the fixing of that sum must depend in each individual case on all the relevant factors relating both to the characteristics of the failure to fulfil obligations established and to the conduct of the Member State involved in the procedure initiated under Article 260 TFEU. That provision confers a wide discretion on the Court in deciding whether to impose such a penalty and, if it decides to do so, in determining the amount (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 97).
156


In those circumstances, it is for the Court, in the exercise of its discretion, to fix the lump sum in an amount appropriate to the circumstances and proportionate to the infringement (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 99).
157


Relevant considerations in this respect include factors such as the seriousness of the infringement and the length of time for which the infringement has persisted since the delivery of the judgment establishing it (judgment of 31 May 2018, Commission v Italy, C‑251/17, not published, EU:C:2018:358, paragraph 100).
158


The circumstances of the present case which must be taken into account are apparent from the considerations set out in paragraphs 120 to 142 above regarding the seriousness and the duration of the infringement and the ability to pay of the Member State in question.