Federal Republic of Germany v Commission of the European Communities.
Date: 2000-10-05
26 It must be borne in mind at the outset that, where the Commission enjoys substantial freedom of assessment, as it does when applying Article 92 of the Treaty, the Court, in considering whether that freedom was lawfully exercised, cannot substitute its own assessment for that of the competent authority but must restrict itself to examining whether that authority's assessment is vitiated by a manifest error or misuse of powers (see, in particular, Case 57/72 Westzucker v Einfuhr- und Vorratsstelle für Zucker [1973] ECR 321, paragraph 14, and Case C-169/95 Spain v Commission [1997] ECR I-135, paragraph 34).
30 In order to determine the extent to which the security in question is in the nature of State aid, the relevant criterion is that indicated in the Commission's decision, namely whether Jadekost could have obtained the amounts in question on the capital market without the security (see, to that effect, Case C-301/87 France v Commission (Boussac) [1990] ECR I-307, paragraph 39, and Case C-142/87 Belgium v Commission (Tubemeuse) [1990] ECR I-959, paragraph 26).
34 Furthermore, it must be borne in mind that, according to settled case-law, the legality of a decision concerning aid is to be assessed in the light of the information available to the Commission when the decision was adopted (Case 234/84 Belgium v Commission [1986] ECR 2263, paragraph 16, and Case C-241/94 France v Commission [1996] ECR I-4551, paragraph 33).
49 Secondly, that definition is consistent with paragraph 18 of Case C-278/95 P Siemens v Commission [1997] ECR I-2507, in which the Court held that aid corresponding to a typical general operating cost that a company must bear in its normal activities was operating aid.
62 In that connection, it should be borne in mind that the Commission may adopt a policy as to how it will exercise its discretion in the form of measures such as the Guidelines, in so far as those measures contain rules indicating the approach which the institution is to take and they do not depart from the rules of the Treaty (see, to that effect, Case C-313/90 CIRFS and Others v Commission [1993] I-1125, paragraphs 34 and 36).
63 The German Government has neither contested nor expressed any doubt as to the compatibility of the Guidelines with Article 92 of the Treaty.
64 The Guidelines, which are not the first to apply in the area under consideration, are based on Article 93(1) of the Treaty, under which the Commission, in cooperation with the Member States, is to keep under constant review the systems of aid existing in those States. It is to propose to them any appropriate measures required by the progressive development or by the functioning of the common market. The Guidelines are thus one element of that obligation of regular, periodic cooperation from which neither the Commission nor a Member State can release itself (see Case C-311/94 IJssel-Vliet [1996] ECR I-5023, paragraphs 36 and 37).
65 The Commission has pointed out that the German Government took part in the procedure for the adoption of the Guidelines and that it approved them, which that government has not disputed. Moreover, those Guidelines constitute one of the conditions for the Commission's approval of the Land of Lower Saxony's General Directives on Securities. The German Government therefore accepted that the rules set out in the Guidelines were applicable. Therefore, in accordance with paragraph 36 of CIRFS and Others v Commission and paragraph 43 of IJssel-Vliet, both cited above, those rules bind the Commission and the German Government.
67 If a measure is to fall within the prohibition referred to in Article 92(1) of the Treaty, it must be an aid originating from the State which distorts or threatens to distort competition and may affect trade between Member States.
77 As for the presumption that operating aid by its very nature distorts competition, it must be pointed out, first, that that presumption follows from the Court's case-law. More specifically, in Case C-86/89 Italy v Commission [1990] ECR I-3891, paragraph 18, the Court concluded that the aid in question had to be regarded as operating aid to the undertakings concerned and that, as such, it affected trading conditions to an extent contrary to the common interest.
82 As a preliminary point, it must be borne in mind that, according to settled case-law, the statement of reasons required by Article 190 of the Treaty must be appropriate to the nature of the measure in question. It must show clearly and unequivocally the reasoning of the institution which enacted the measure so as to inform the persons concerned of the justification for the measure adopted and to enable the Court to exercise its powers of review (see Joined Cases 67/85, 68/85 and 70/85 Van der Kooy and Others v Commission [1988] ECR 219, paragraph 71, and Case C-353/92 Greece v Council [1994] ECR I-3411, paragraph 19).
83 Moreover, the requirement to state reasons must be appraised on the basis of the particular features of the case in point, such as the content of the measure in question and the nature of the reasons given (Joined Cases 296/82 and 318/82 Netherlands and Leeuwarder Papierwarenfabriek v Commission [1985] ECR 809, paragraph 19).
90 That finding is in conformity with the judgment in Siemens v Commission, cited above, in which the Court upheld the reasoning of the Court of First Instance, which had held, in paragraph 48 of its judgment in Case T-459/93 Siemens v Commission [1995] ECR II-1675, that operating aid does not in principle fall within the scope of Article 92(3) of the Treaty.
99 It must be borne in mind that, according to settled case-law, observance of the rights of the defence is, in all procedures initiated against a person which are liable to culminate in a measure adversely affecting that person, a fundamental principle of Community law which must be guaranteed even in the absence of any rules governing the procedure in question (see the judgments in Belgium v Commission, paragraph 27, and Boussac, paragraph 29, cited above).
100 In those judgments the Court recognised that that principle requires the Member State in question to be placed in a position in which it may effectively make known its views on the observations submitted by interested third parties under Article 93(2) of the Treaty. In so far as the Member State had not been afforded the opportunity to comment on such observations, the Commission could not incorporate them in its decision against that State.
101 However, such an infringement of the rights of the defence results in annulment only if, had it not been for such an irregularity, the outcome of the procedure might have been different (see Boussac, cited above, paragraph 31).