Comunità montana della Valnerina v Commission of the European Communities.
Date: 2006-01-19
43. It must be recalled first that since it would be ultra vires for the Community judicature to rule ultra petita (see Joined Cases 46/59 and 47/59 Meroni  v High Authority  [1962] ECR 411, at page 419, and Case 37/71 Jamet  v Commission  [1972] ECR 483, paragraph 12), the scope of the annulment which it pronounces may not go further than that sought by the applicant (Case C‑310/97 P Commission  v AssiDomän Kraft Products and Others  [1999] ECR I‑5363, paragraph 52).
53. For the purposes of examining CMV’s arguments relating to the specific complaints set out by the Commission in the withdrawal decision, it must first be noted that the Court has already ruled, in response to an argument based on the principle of gradation of measures, that Article 24(2) of Regulation No 4253/88 authorises the Commission to request the complete cancellation of Community financial assistance and that limiting the possibilities open to the Commission to reduce the assistance in proportion exclusively to the amount to which the irregularities found to exist relate would have the effect of encouraging fraud on the part of the applicants for financial assistance, since they would then risk only the loss of the benefit of the sums unduly paid (see, to that effect Case C‑500/99 P Conserve Italia  v Commission  [2002] ECR I‑867, paragraphs 74, 88 and 89).
– The arguments concerning the making of a film by Romana Video
63. It must be stated that the question of whether the sale of the marketing rights in the film in question to Romana Video constituted a genuine sale or a fictitious transaction constitutes an appraisal of the facts. It is settled law that the Court of First Instance alone has jurisdiction to find the facts, save where a substantive inaccuracy in its findings is attributable to the documents submitted to it, and also to appraise those facts. The appraisal of the facts therefore does not, save where the clear sense of the evidence has been distorted, constitute a point of law which is subject, as such, to review by the Court of Justice (see in particular Case C‑390/95 P Antillean Rice Mills and Others  v Commission  [1999] ECR I‑769, paragraph 29, and Case C‑237/98 P Dorsch Consult  v Council and Commission  [2000] ECR I‑4549, paragraph 35).
69. In this respect, it must be stated that, contrary to CMV’s assertions, the mere fact that the second paragraph of Article 3 of the award decision provides for situations where the costs actually incurred are less than the original estimates does not mean that a fictitious transaction, the purpose of which is to increase the costs of a project, does not constitute an irregularity within the meaning of Article 24 of Regulation No 4253/88. Indeed, in accordance with a fundamental principle governing Community aid, as stated by the Advocate General in paragraph 77 of her Opinion, the Community can subsidise only expenditure actually incurred (see to that effect, with regard to the clearing of accounts, Cases C‑55/91 Italy  v Commission  [1993] ECR I‑4813, paragraph 67; C‑253/97 Italy  v Commission  [1999] ECR I‑7529, paragraph 6; C‑153/01 Spain  v Commission  [2004] ECR I‑9009, paragraph 66; and C‑199/03 Ireland  v Commission  [2005] ECR I‑0000, paragraph 26). The charging to a project of expenditure which in fact has not been incurred in carrying out the project seriously undermines that principle and can therefore be regarded as an irregularity within the meaning of Article 24 of Regulation No 4253/88. The second paragraph of Article 3 of the award decision creates a mechanism for determining the amount of eligible expenditure where it proves to be less than the original estimates, but it does not cater for situations in which costs have been charged that have not been shown to be genuine.
77. Secondly, CMV’s argument that the mere fact that the project was implemented justifies the costs in question cannot be accepted. The Court of Justice has already ruled that measures set out in Article 24 of Regulation No 4253/88 for withdrawing financial assistance and recovering sums unduly paid are not reserved for breaches that compromise the implementation of the project concerned or entail a significant change affecting the nature and very existence of the project (see, to that effect, the order in Vela and Tecnagrind  v Commission , paragraphs 129 to 134). Consequently, the Court of First Instance was right to rule, in paragraph 94 of the judgment under appeal, that it cannot be argued that the penalties provided for by that provision apply only where the operation being financed has not been carried out in whole or in part.
105. To begin with, it must be recalled that, according to settled case-law, it follows from Article 225 EC, the first paragraph of Article 58 of the Statute of the Court of Justice and Article 112(1)(c) of the Rules of Procedure of the Court of Justice that an appeal must indicate precisely the contested elements of the judgment which the appellant seeks to have set aside and also the legal arguments specifically advanced in support of the appeal (see, inter alia, Case C‑352/98 P Bergaderm and Goupil  v Commission  [2000] ECR I‑5291, paragraph 34, Case C‑248/99 P France  v Monsanto and Commission  [2002] ECR I‑1, paragraph 68, and Case C‑41/00 P Interporc  v Commission  [2003] ECR I‑2125, paragraph 15).
106. An appeal which merely repeats or reproduces verbatim the pleas in law and arguments previously submitted to the Court of First Instance, including those based on facts expressly rejected by that Court, does not satisfy the requirements to state reasons under those provisions (see, in particular, the order in Case C‑174/97 P FFSA and Others  v Commission  [1998] ECR I‑1303, paragraph 24, and the judgment in Interporc  v Commission , cited above, paragraph 16). In reality, such an appeal amounts to no more than a request for a reexamination of the application submitted to the Court of First Instance, a matter which falls outside the jurisdiction of the Court of Justice (see the order in Case C‑26/94 P X  v Commission  [1994] ECR I‑4379, paragraph 13, and the judgment in Bergaderm and Goupil  v Commission , cited above, paragraph 35).
107. However, provided that the appellant challenges the interpretation or application of Community law by the Court of First Instance, the points of law examined at first instance may be discussed again in the course of an appeal (see Case C‑210/98 P Salzgitter  v Commission  [2000] ECR I‑5843, paragraph 43). Indeed, if an appellant could not thus base his appeal on pleas in law and arguments already relied on before the Court of First Instance, an appeal would be deprived of part of its purpose (see, in particular, the order in Case C‑345/00 P FNAB and Others  v Council  [2001] ECR I‑3811, paragraphs 30 and 31, and the judgments in Case C‑321/99 P ARAP and Others  v Commission  [2002] ECR I‑4287, paragraph 49, and in Interporc  v Commission , cited above, paragraph 17).
129. As the Court of First Instance pointed out in paragraph 136 of the judgment under appeal, it is apparent from the case-law of the Court of Justice that respect for the rights of the defence is, in all proceedings 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 proceedings in question. That principle requires that the addressees of decisions which significantly affect their interests should be placed in a position in which they may effectively make known their views (see, for example, Case C‑32/95 P Commission  v Lisrestal and Others  [1996] ECR I‑5373, paragraph 21, Case C‑462/98 P Mediocurso  v Commission  [2000] ECR I‑7183, paragraph 36, and Case C‑287/02 Spain  v Commission  [2005] ECR I‑00000, paragraph 37).
140. As the Advocate General has stated in paragraph 97 of her Opinion, it is clear from Article 24 of Regulation No 4253/88 – the provision on which the withdrawal decision is based – that the Commission is not required to request repayment of the financial assistance in full, but at its discretion may or may not decide to request such repayment and, where appropriate, to set the proportion to be repaid (see also, to that effect, the judgment in Ireland  v Commission , paragraphs 27 and 30). In the light of the principle of proportionality, the Commission must exercise this discretion in such a way that repayments which it orders are not disproportionate to the irregularities committed.
143. It should be recalled in this regard that the infringement of obligations whose observance is of fundamental importance to the proper functioning of a Community system may be penalised by forfeiture of a right conferred by Community legislation, such as entitlement to aid (Case C‑104/94 Cereol Italia  [1995] ECR I‑2983, paragraph 24).