Kingdom of Belgium v Commission of the European Communities.
Date: 1996-02-29
10 According to settled case-law, the charging by a Member State, or an entity on which it exerts influence, of a tariff fixed at a level lower than that which would normally be chosen may be regarded as aid for the purposes of Article 92(1) of the Treaty. In such circumstances, the State, or the entity on which it exerts influence, does not apply the preferential tariff as an ordinary economic agent but uses it to confer a financial advantage on certain undertakings by forgoing the profit which it would normally realize. On the other hand, a preferential tariff does not constitute aid if, in the context of the market in question, it is objectively justified by economic reasons such as the need to withstand competition on the same market (see, to that effect, Joined Cases 67/85, 68/85 and 70/85 Van der Kooy and Others v Commission [1988] ECR 219, paragraphs 28 to 30).
11 Since a complex economic appraisal is involved here, it should also be noted that, according to the case-law, in reviewing an act of the Commission which has necessitated such an appraisal, the Court must confine itself to verifying whether the Commission complied with the relevant rules governing procedure and the statement of reasons, whether the facts on which the contested finding was based have been accurately stated and whether there has been any manifest error of assessment or a misuse of powers (see inter alia Case 138/79 Roquette Frères v Council [1980] ECR 3333, paragraph 25; Joined Cases 142/84 and 156/84 BAT and Reynolds v Commission [1987] ECR 4487, paragraph 62; Case C-174/87 Ricoh v Council [1992] ECR I-1335, paragraph 68, and Case C-225/91 Matra v Commission [1993] ECR I-3203, paragraph 25).
17 That argument must be rejected. It need only be pointed out here, as was done by the Commission, that in paragraph 15 of the judgment in CdF Chimie AZF v Commission, cited above, the Court found that tariff F was a public tariff whose conditions of availability were public and perfectly open.
25 Fifthly, the Kingdom of Belgium challenges the following statement made by the Commission: "... If the price of the gas which [a nitrate fertilizer producer] uses in order to manufacture the ammonia he requires is too high, he will decide to purchase the ammonia, if possible, elsewhere at a lower cost than he would have to pay if he produced it himself (situation in Belgium, for example, in 1983) ..." (paragraph 21 of the Decision). The Kingdom of Belgium points out that Belgian nitrate fertilizer producers annually import ammonia so as to bridge the gap between production and consumption and there is nothing to indicate that 1983 imports were prompted by other considerations or that production levels had been abnormally low.
68 It should be remembered in that regard that, pursuant to Article 42(2) of the Court' s Rules of Procedure, no new plea in law may be introduced in the course of proceedings unless it is based on matters of law or of fact which have come to light in the course of the procedure. Since that is not the position here, this plea must be rejected.
70 The Kingdom of Belgium argues, first, that to justify tariff F on the ground that prices for natural gas are lower in other countries is contrary to the Court' s finding in Case 78/76 (Steinike und Weinlig v Germany [1977] ECR 595, paragraph 24), to the effect that a Member State cannot justify an infringement of Article 92 of the Treaty by claiming that other Member States are also failing to comply with that provision. Furthermore, the Commission did not examine the specific conditions on the markets for natural gas and ammonia in Member States where prices are lower than in the Netherlands.
73 The Kingdom of Belgium also refers to the Commission' s argument set out in the expert opinion referred to in paragraph 51 to the effect that, when natural gas is used as a feedstock and when its price as such plays an essential role in determining the cost of the end product, its price does not only depend on prices of the substituting feedstocks but also on the price of the end product itself (see paragraph 18 of the Decision). According to the Kingdom of Belgium, that argument runs counter to the position adopted by the Court in its judgment in Case 27/76 (United Brands v Commission [1978] ECR 207, paragraph 229), in which it stated that the interplay of supply and demand should only be applied to each stage where it is really manifest.
74 This second part of the plea must also be rejected. The Court, in its reasoning in United Brands, set out to demonstrate that the mechanisms of the market are affected if, in the calculation of the price, account is taken of the law of supply and demand, not as between the vendor and the purchaser (in that case, distributors) but ° by jumping one market stage ° as between the vendor and the ultimate consumer (see paragraph 230). Thus the Court' s reasoning in that decision is in no way at variance with the Commission' s argument that demand for natural gas by the nitrate fertilizer producers is actually affected by competition from imported ammonia.
75 The Kingdom of Belgium argues, thirdly, that, contrary to the Court' s direction in paragraph 30 of its judgment in Van der Kooy and Others v Commission, cited above, the Commission took no account in its Decision of the costs entailed for nitrate fertilizer producers if they were to convert from producing ammonia from natural gas to purchasing ammonia directly.
77 Fourthly, the Kingdom of Belgium, relying on paragraph 28 of the judgment in Van der Kooy and Others v Commission, argues that the Commission should have examined whether Gasunie had forgone a possible profit. Belgium also points out that, as was stated in the expert opinion provided in CdF Chimie AZF v Commission, cited above, tariff F is still a State measure seeking to confer a financial benefit on certain undertakings, even if a political decision to support Dutch nitrate fertilizer producers is perhaps also in Gasunie' s commercial interests.
79 According to settled case-law, Article 92 of the Treaty does not make a distinction according to the causes or aims of the measures of State intervention concerned but defines them according to their effects (Case 173/73 Italy v Commission [1974] ECR 709 and Case 310/85 Deufil v Commission [1987] ECR 901, paragraph 8). Where a practice is objectively justified on commercial grounds, the fact that it also furthers a political aim does not mean to say that it constitutes State aid for the purposes of Article 92 of the Treaty.
81 On that point, it should be noted that Article 92 of the Treaty only applies to aid, granted by States or through State resources, which favours certain undertakings or the production of certain goods. In paragraph 23 of its judgment in CdF Chimie AZF v Commission, cited above, the Court found that tariff F is sectoral in nature since it applies to certain undertakings, namely Dutch ammonia producers.
86 The Court has consistently held that the statement of reasons required by Article 190 of the Treaty must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Court to carry out its review. It is also clear from the relevant case-law that it is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 190 of the Treaty must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (see, in particular, Case C-350/88 Delacre and Others v Commission [1990] ECR I-395, paragraphs 15 and 16, and Case C-466/93 Atlanta Fruchthandelsgesellschaft and Others v Bundesamt fuer Ernaehrung und Forstwirtschaft [1995] ECR I-0000, paragraph 16).