Italian Republic v Commission of the European Communities.
Date: 1991-03-21
11 The Italian Republic puts forward three pleas alleging that the injections of capital were not undertaken by the State, that they were consistent with the normal behaviour of a private investor and that they did not adversely affect competition within the Community.
13 As the Court has consistently held (see in particular the judgment in Joined Cases 67, 68 and 70/85, Van der Kooy v Commission [1988] ECR 219, paragraph 35) no distinction should be drawn between cases where aid is granted directly by the State and cases where it is granted by public or private bodies established or appointed by the State to administer the aid. In the present case, there is considerable evidence in the documents before the Court that the injections of capital were the result of action attributable to the Italian State.
18 It should be pointed out in this connection that, according to settled case-law, investment by the public authorities in the capital of undertakings, in whatever form, may constitute State aid where the conditions set out in Article 92 are fulfilled.
19 In order to determine whether such measures are in the nature of State aid, it is necessary to consider whether in similar circumstances a private investor of a size comparable to that of the bodies administering the public sector might have provided capital of such an amount.
20 It should be added that although the conduct of a private investor with which the intervention of the public investor pursuing economic policy aims must be compared need not be the conduct of an ordinary investor laying out capital with a view to realizing a profit in the relatively short term, it must at least be the conduct of a private holding company or a private group of undertakings pursuing a structural policy - whether general or sectorial - and guided by prospects of profitability in the longer term.
26 In that connection it should be observed that where an undertaking operates in a sector in which there is surplus production capacity and producers from various Member States compete, any aid which it may receive from the public authorities is liable to affect trade between the Member States and impair competition, inasmuch as its continuing presence on the market prevents competitors from increasing their market share and reduces their chances of increasing exports. It is sufficient to note that, on the Italian market alone, Alfa Romeo' s share was 14.6% in 1986.
40 As regards the argument of the Italian Republic that the obligation to repay the aid should not be borne by Finmeccanica, which had transferred the undertaking to an economic agent in the private sector, it is sufficient to note that Finmeccanica, as the holding company to which Alfa Romeo belonged at the material time, must be regarded as the recipient of the contested aid. As such, it is therefore required to repay that aid.
41 As for the argument that recovery of the aid can no longer restore stability to the market, it must be reiterated that, as the Court has consistently held (see most recently the judgment in Case 142/87, Belgium v Commission [1990] ECR 959, paragraph 66), recovery of unlawful aid is the logical consequence of the finding that it is unlawful.