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Document 62006TJ0050(02)
Judgment of the General Court (First Chamber, Extended Composition) of 22 April 2016.#Ireland and Aughinish Alumina Ltd v European Commission.#State aid — Directive 92/81/EEC — Excise duties on mineral oils — Mineral oils used as fuel for alumina production — Exemption from excise — Existing or new aid — Article 1(b)(i), (iii) and (iv) of Regulation (EC) No 659/1999 — Legal certainty — Legitimate expectations — Reasonable time — Principle of sound administration — Misuse of powers — Obligation to state reasons — Concept of State aid — Advantage — Effect on trade between Member States — Distortion of competition.#Joined Cases T-50/06 RENV II and T-69/06 RENV II.
Judgment of the General Court (First Chamber, Extended Composition) of 22 April 2016.
Ireland and Aughinish Alumina Ltd v European Commission.
State aid — Directive 92/81/EEC — Excise duties on mineral oils — Mineral oils used as fuel for alumina production — Exemption from excise — Existing or new aid — Article 1(b)(i), (iii) and (iv) of Regulation (EC) No 659/1999 — Legal certainty — Legitimate expectations — Reasonable time — Principle of sound administration — Misuse of powers — Obligation to state reasons — Concept of State aid — Advantage — Effect on trade between Member States — Distortion of competition.
Joined Cases T-50/06 RENV II and T-69/06 RENV II.
Judgment of the General Court (First Chamber, Extended Composition) of 22 April 2016.
Ireland and Aughinish Alumina Ltd v European Commission.
State aid — Directive 92/81/EEC — Excise duties on mineral oils — Mineral oils used as fuel for alumina production — Exemption from excise — Existing or new aid — Article 1(b)(i), (iii) and (iv) of Regulation (EC) No 659/1999 — Legal certainty — Legitimate expectations — Reasonable time — Principle of sound administration — Misuse of powers — Obligation to state reasons — Concept of State aid — Advantage — Effect on trade between Member States — Distortion of competition.
Joined Cases T-50/06 RENV II and T-69/06 RENV II.
Court reports – general
ECLI identifier: ECLI:EU:T:2016:227
JUDGMENT OF THE GENERAL COURT (First Chamber, Extended Composition)
22 April 2016 ( *1 )
‛State aid — Directive 92/81/EEC — Excise duties on mineral oils — Mineral oils used as fuel for alumina production — Exemption from excise — Existing or new aid — Article 1(b)(i), (iii) and (iv) of Regulation (EC) No 659/1999 — Legal certainty — Legitimate expectations — Reasonable time — Principle of sound administration — Misuse of powers — Obligation to state reasons — Concept of State aid — Advantage — Effect on trade between Member States — Distortion of competition’
In Joined Cases T‑50/06 RENV II and T‑69/06 RENV II,
Ireland, represented by E. Creedon, A. Joyce and E. McPhillips, acting as Agents, and P. McGarry, Senior Counsel,
Aughinish Alumina Ltd, established in Askeaton (Ireland), represented by C. Waterson, C. Little and J. Handoll, Solicitors,
applicants,
v
European Commission, represented by V. Di Bucci, N. Khan, G. Conte, D. Grespan and K. Walkerová, acting as Agents,
defendant,
APPLICATION for the annulment of Commission Decision 2006/323/EC of 7 December 2005 concerning the exemption from excise duty on mineral oils used as fuel for alumina production in Gardanne, in the Shannon region and in Sardinia respectively implemented by France, Ireland and Italy (OJ 2006 L 119, p. 12), to the extent that that decision concerns the exemption from excise duty on mineral oils used as fuel for alumina production in the Shannon region (Ireland),
THE GENERAL COURT (First Chamber, Extended Composition)
composed of H. Kanninen, President, I. Pelikánová (Rapporteur), E. Buttigieg, S. Gervasoni and L. Madise, Judges,
Registrar: S. Spyropoulos, Administrator,
having regard to the written procedure and further to the hearing on 6 May 2015,
gives the following
Judgment
Background to the dispute
The exemption at issue
1 |
Alumina (or aluminium oxide) is a white powder principally used in smelters to produce aluminium. It is extracted from bauxite by a refining process, the last stage of which is calcination. More than 90% of the calcinated alumina is used in the smelting of aluminium metal. The remainder is further processed and used in chemical applications. There are two distinct product markets: smelter-grade alumina (SGA) and chemical-grade alumina (CGA). Mineral oils may be used as fuel for alumina production. |
2 |
There is only one producer of alumina in each of Ireland, Italy and France. In Ireland, it is Aughinish Alumina Ltd (‘AAL’), established in the Shannon region. Alumina producers are also present in Germany, Spain, Greece, Hungary and the United Kingdom. |
3 |
Since 12 May 1983, Ireland has exempted from excise duty mineral oils used for the production of alumina (‘the exemption at issue’). The exemption at issue was introduced into Irish law by Statutory instrument No 126, Imposition of Duties (No 265) (Excise Duty on Hydrocarbon Oils) Order, 1983, of 12 May 1983 (‘the 1983 order’). |
4 |
The application of the exemption at issue to the Shannon region was authorised by Council Decision 92/510/EEC of 19 October 1992 authorising Member States to continue to apply to certain mineral oils, when used for specific purposes, existing reduced rates of excise duty or exemptions from excise duty, in accordance with the procedure provided for in Article 8(4) of Directive 92/81/EEC (OJ 1992 L 316, p. 16). That authorisation was reviewed and extended by the Council of the European Union until 31 December 1998 by Council Decision 97/425/EC of 30 June 1997 authorising Member States to apply or to continue to apply to certain mineral oils, when used for specific purposes, existing reduced rates of excise duty or exemptions from excise duty, in accordance with the procedure provided for in Directive 92/81 (OJ 1997 L 182, p. 22). It was further extended by the Council until 31 December 2000 by Decision 1999/880/EC of 17 December 1999 authorising Member States to apply and to continue to apply to certain mineral oils, when used for specific purposes, existing reduced rates of excise duty or exemptions from excise duty, in accordance with the procedure provided for in Directive 92/81 (OJ 1999 L 331, p. 73). |
5 |
Council Decision 2001/224/EC of 12 March 2001 concerning reduced rates of excise duty and exemptions from such duty on certain mineral oils when used for specific purposes (OJ 2001 L 84, p. 23), which was the last decision concerning the exemption at issue, extends that exemption until 31 December 2006. According to recital 5 thereof, that decision ’shall be without prejudice to the outcome of any procedures relating to distortions of the operation of the single market that may be undertaken, in particular under Articles 87 [EC] and 88 [EC]’ and ‘it does not override the requirement for Member States to notify instances of potential State aid to the Commission under Article 88 [EC]’. |
Administrative procedure
6 |
By letter of 28 January 1983, Ireland informed the Commission of the European Communities that it was preparing to implement an undertaking given to Alcan Aluminium Ltd (‘Alcan’) in April 1970, in relation to the construction, in the Shannon region, of an alumina production plant that was subsequently sold to AAL, and relating to an exemption from excise duty on fuel oil used in alumina production in that plant. By letter of 22 March 1983, the Commission stated that that exemption constituted State aid which had to be notified. It also stated that, if the aid were to be implemented only at the time of writing, it could regard the letter of 28 January 1983 as notification for the purposes of Article 88(3) EC. By letter of 6 May 1983, Ireland requested the Commission to regard the letter as such notification. The Commission did not adopt any decision following that correspondence. |
7 |
By letter of 17 July 2000, the Commission requested Ireland to notify it of the exemption at issue. By letter of 27 September 2000, it reiterated that request to Ireland, inviting it to provide additional information. Ireland replied by letter of 18 October 2000. |
8 |
By Decision C(2001) 3296 of 30 October 2001, the Commission initiated the procedure laid down in Article 88(2) EC in respect of the exemption at issue (‘the formal investigation procedure’). That decision was notified to Ireland, by letter of 5 November 2001, and was published, on 2 February 2002, in the Official Journal of the European Communities (OJ 2002 C 30, p. 25). |
9 |
After having requested, by fax of 1 December 2001, an extension of the time limit, which was granted to it on 7 December 2001, Ireland submitted its comments by letter of 8 January 2002. |
10 |
By letter of 18 February 2002, the Commission asked Ireland for further information. |
11 |
By letters of 26 and 28 February and 1 March 2002, the Commission received the respective comments of AAL, Eurallumina SpA, Alcan Inc. and the European Aluminium Association. Those were sent to Ireland, by letters of 26 March 2002. |
12 |
By letter of 26 April 2002, Ireland replied to the request the Commission had made in its letter of 18 February 2002. |
Alumina Decision I
13 |
On 7 December 2005 the Commission adopted Decision 2006/323/EC concerning the exemption from excise duty on mineral oils used as fuel for alumina production in Gardanne, in the Shannon region and in Sardinia respectively implemented by France, Ireland and Italy (OJ 2006 L 119, p. 12; ‘Alumina Decision I’). |
14 |
Alumina Decision I relates to the period before 1 January 2004, the date on which Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity (OJ 2003 L 283, p. 51), repealing Council Directive 92/81/EEC of 19 October 1992 on the harmonisation of the structures of excise duties on mineral oils (OJ 1992 L 316, p. 12) and Council Directive 92/82/EEC of 19 October 1992 on the approximation of the rates of excise duties on mineral oils (OJ 1992 L 316, p. 19) with effect from 31 December 2003 (recital 57) became applicable. Nevertheless, it extends the formal investigation procedure to the period after 31 December 2003 (recital 92). |
15 |
The operative part of Alumina Decision I states, inter alia: ‘Article 1 The exemptions from excise duty granted by France, Ireland and Italy in respect of heavy fuel oils used in the production of alumina until 31 December 2003 constitute State aid within the meaning of Article 87(1) [EC]. Article 2 Aid granted between 17 July 1990 and 2 February 2002, to the extent that it is incompatible with the common market, shall not be recovered as this would be contrary to the general principles of Community law. Article 3 The aid referred to in Article 1 granted between 3 February 2002 and 31 December 2003 is compatible with the common market within the meaning of Article 87(3) [EC] in so far as the beneficiaries pay at least a rate of EUR 13.01 per 1000 kg of heavy fuel oils. Article 4 The aid … granted between 3 February 2002 and 31 December 2003 is incompatible with the common market within the meaning of Article 87(3) [EC] in so far as the beneficiaries did not pay a rate of EUR 13.01 per 1000 kg of heavy fuel oils. Article 5 1. France, Ireland and Italy shall take all necessary measures to recover from the beneficiaries the incompatible aid referred to in Article 4. … 5. France, Ireland and Italy shall order, within two months of the date of notification of this Decision, the beneficiaries of the incompatible aid referred to in Article 4 to repay, the aid unlawfully granted plus interest.’ |
Procedure and forms of order sought by the parties
16 |
By applications lodged with the Court Registry on 17 and 23 February 2006, respectively, Ireland and AAL brought the present actions, which were registered under reference numbers T‑50/06 and T‑69/06, respectively. |
17 |
By separate document, received at the Court Registry on 22 March 2006, AAL lodged an application for interim measures under Article 242 EC, seeking suspension of the operation of Alumina Decision I in so far as that decision concerned it. That application was registered under reference number T‑69/06 R. By order of 2 August 2006, the President of the General Court dismissed that application and reserved the costs. |
18 |
Pursuant to Article 14 of the Rules of Procedure of the Court of 2 May 1991 and acting on a proposal from the Second Chamber, the General Court decided, after hearing the parties in accordance with Article 51 of those rules, to refer the present case to a Chamber sitting in extended composition. |
19 |
By order of 24 May 2007, the President of the Second Chamber (Extended Composition) of the Court, after hearing the parties, Joined Cases T‑50/06, T‑56/06, T‑60/06, T‑62/06 and T‑69/06 (‘the Alumina I cases’) for the purposes of the oral procedure, in accordance with Article 50 of the Rules of Procedure of 2 May 1991. |
20 |
By judgment of 12 December 2007 in Ireland and Others v Commission (T‑50/06, T‑56/06, T‑60/06, T‑62/06 and T‑69/06, EU:T:2007:383), the Court joined the Alumina I cases for the purposes of the judgment, annulled Alumina Decision I and, in Case T‑62/06, dismissed the remainder of the action. |
21 |
By application filed on 26 February 2008, the Commission lodged an appeal against the judgment of the Court. |
22 |
By judgment of 2 December 2009 in Commission v Ireland and Others (C‑89/08 P, ECR, EU:C:2009:742), the Court of Justice set aside the judgment in Ireland and Others v Commission, cited in paragraph 20 above (EU:T:2007:383), in so far as the General Court had annulled Alumina Decision I, referred the Alumina I cases back to the General Court and reserved the costs. |
23 |
Following the judgment in Commission v Ireland and Others, cited in paragraph 22 above (EU:C:2009:742), and pursuant to Article 118(1) of the Rules of Procedure of 2 May 1991, the Alumina I cases were assigned to the Second Chamber (Extended Composition) by decision of the President of the General Court of 18 December 2009. |
24 |
By order of the President of the Second Chamber (Extended Composition) of 1 March 2010, the Alumina I cases were joined for the purposes of the written procedure, the oral procedure and the judgment. By decision of the President of the Court of 20 September 2010, the Alumina I cases were reassigned to the Fourth Chamber (Extended Composition). |
25 |
By judgment of 21 March 2012 in Ireland v Commission (T‑50/06 RENV, T‑56/06 RENV, T‑60/06 RENV, T‑62/06 RENV and T‑69/06 RENV, ECR, EU:T:2012:134), the Court annulled Alumina Decision I, in so far as it found, or was based on the finding, that the exemptions from excise duties on mineral oils used as fuel for the production of alumina granted by the French Republic, Ireland and the Italian Republic until 31 December 2003 (‘the exemptions from excise duty’) constituted State aid within the meaning of Article 87(1) EC and in so far as it ordered the French Republic, Ireland and the Italian Republic to take all measures necessary to recover those exemptions from their recipients to the extent that the latter did not pay excise duty at the rate of at least EUR 13.01 per 1000 kg of heavy fuel oils. |
26 |
By application filed on 1 June 2012, the Commission lodged an appeal against the Court’s judgment. |
27 |
By judgment of 10 December 2013 in Commission v Ireland and Others (C‑272/12 P, ECR, EU:C:2013:812), the Court of Justice set aside the judgment in Ireland v Commission (cited in paragraph 25 above, EU:T:2012:134), referred the Alumina I cases back to the General Court and reserved the costs. |
28 |
Further to the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), the Alumina I cases were assigned to the First Chamber by decisions of the President of the Court of 21 January and 10 March 2014. |
29 |
In accordance with Article 119(1) of the Rules of Procedure of 2 May 1991, the parties lodged their written observations on 21 February 2014 (Ireland) and 14 April 2014 (the Commission) in Case T‑50/06 RENV II, and on 26 February 2014 (AAL) and 15 April 2014 (the Commission) in Case T‑69/06 RENV II. However, the applicants, in their written observations, stated that they were maintaining all the pleas in law put forward in support of the forms of order sought in the present actions. The Commission took note of that in its written observations. |
30 |
By decision of the President of the Court of 30 September 2014, the Alumina I cases were reassigned to the First Chamber (Extended Composition), in accordance with Article 118(1) of the Rules of Procedure of 2 May 1991. |
31 |
Acting upon a report of the Judge-Rapporteur, the Court decided to open the oral procedure and, by way of a measure of organisation of procedure adopted pursuant to Article 64(3)(d) of the Rules of Procedure of 2 May 1991, requested Ireland, in Case T‑50/06 RENV II, to produce the letters of 8 January and 26 April 2002 (see paragraphs 9 and 12 above). Ireland complied with that request within the period prescribed. |
32 |
By order of the President of the First Chamber (Extended Composition) of 23 March 2015, the present cases were joined for the purposes of the oral procedure and the judgment. |
33 |
The parties presented oral argument and their replies to the Court’s oral questions at the hearing on 6 May 2015. |
34 |
Ireland claims that the Court should:
|
35 |
AAL claims that the Court should:
|
36 |
The Commission contends that the Court should:
|
Law
37 |
As a preliminary point, it should be borne in mind that the present actions must both be interpreted as seeking, in essence, the annulment of Alumina Decision I in so far as it determines the existence of State aid which Ireland granted, between 3 February 2002 and 31 December 2003, on the basis of the exemption at issue (‘the aid at issue’), and orders Ireland to recover it (‘the contested decision’). In that respect, the actions have the same subject matter. |
38 |
In support of the action in Case T‑50/06 RENV II, Ireland relies, essentially, on four pleas in law. The first plea alleges an error of law in the classification of the aid at issue in the light of Article 88 EC. The second plea alleges infringement of the principle of legal certainty, the estoppel principle and of Article 8(5) of Directive 92/81. The third plea alleges infringement of the principle of protection of legitimate expectations. The fourth plea alleges, in essence, infringement of the estoppel principle and misuse of powers. |
39 |
In support of the action in Case T‑69/06 RENV II, AAL relies on six pleas in law. The first plea alleges, in essence, an error of law in the classification of the exemption at issue in the light of Article 88 EC. The second plea alleges, in essence, that the Commission infringed the principles of legal certainty and of the effet utile of acts of the institutions, exceeded its competence and misused its powers. The third plea alleges infringement of the requirements under Article 3(1)(m) EC and Article 157 EC. The fourth plea alleges infringement of the principles of protection of legitimate expectations and of legal certainty. The fifth plea alleges, in essence, infringement of the principle that action must be taken within a reasonable time and of the principles of legal certainty and of sound administration linked to the excessive duration of the formal investigation procedure. The sixth plea alleges, in essence, breach of the obligation to state reasons and infringement of Article 87(1) EC. |
40 |
It is appropriate to examine, first of all, the pleas by which the applicants dispute, in essence, the applicability to the exemption at issue of the rules on State aid, namely (i) the second plea, alleging infringement of the principle of legal certainty, the estoppel principle and of Article 8(5) of Directive 92/81, and the fourth plea, alleging infringement of the estoppel principle and misuse of powers, raised in support of the action in Case T‑50/06 RENV II, and (ii) the second plea, alleging infringement of the principles of legal certainty and of the effet utile of acts of the institutions and that the Commission exceeded its competence and misused its powers, and the third plea, alleging infringement of the requirements under Article 3(1)(m) EC and Article 157 EC, raised in support of the action in Case T‑69/06 RENV II. |
41 |
Next, it is necessary to examine the plea by which AAL objects, essentially, to the classification of the exemption at issue as State aid, within the meaning of Article 87(1) EC, for the period up until 31 December 2003, namely the sixth plea raised in support of the action in Case T‑69/06 RENV II, alleging breach of the obligation to state reasons and infringement of Article 87(1) EC. |
42 |
It is appropriate then to examine the pleas by which the applicants criticise, essentially, the classification of the exemption at issue as new aid and not as existing aid, within the meaning of Article 88 EC, namely the first pleas raised in support of the present actions, alleging an error of law in the classification of the aid at issue in the light of Article 88 EC. |
43 |
Last, it is necessary to conclude by examining the pleas by which the applicants dispute, essentially, the recovery of the aid at issue, namely (i) the third plea, alleging infringement of the principle of the protection of legitimate expectations, raised in support of the action in Case T‑50/06 RENV II, and (ii) the fourth plea, alleging infringement of the principles of protection of legitimate expectations and of legal certainty, and the fifth plea, alleging infringement of the principle that action must be taken within a reasonable time and of the principles of legal certainty and of sound administration, linked to the excessive duration of the formal investigation procedure, raised in support of the action in Case T‑69/06 RENV II. |
(i) The second plea, alleging infringement of the principle of legal certainty, the estoppel principle and of Article 8(5) of Directive 92/81, and the fourth plea, alleging infringement of the estoppel principle and misuse of powers, raised in support of the action in Case T‑50/06 RENV II, and (ii) the second plea, alleging infringement of the principles of legal certainty and of the effet utile of acts of the institutions and that the Commission exceeded its competence and misused its powers, raised in support of the action in Case T‑69/06 RENV II
44 |
In the context of the second plea raised in support of the action in Case T‑50/06 RENV II, Ireland complains that the Commission infringed the principle of legal certainty, as interpreted in case-law, by having adopted, in respect of the exemption at issue, a decision which produces effects contrary to those produced by Decision 2001/224 since, although, by that latter decision, the Council had authorised Ireland to continue applying the exemption at issue until 31 December 2006, the Commission decided, by Alumina Decision I, that the exemption at issue constituted aid which was incompatible with the common market, within the meaning of Article 87(3) EC and which therefore had to be recovered. Moreover, Ireland claims that the Commission infringed the estoppel principle in adopting the contested decision, which has produced effects contrary to those produced by Decision 2001/224, without having brought an action for annulment, pursuant to Article 230 EC, against that same decision. Last, Ireland argues that, in adopting the contested decision, the Commission infringed Article 8(5) of Directive 92/81 since, if it considered that the exemption at issue, which Ireland had been authorised to apply up to 31 December 2006 by Decision 2001/224, was responsible for distorting competition or was incompatible with the common market, it should have followed the procedure provided for in that article and submitted to the Council appropriate proposals for withdrawing or amending the authorisation granted. |
45 |
In the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, Ireland essentially claims that, in adopting the contested decision, the Commission infringed the estoppel principle and misused its powers. It considers that the estoppel principle precluded the Commission from adopting the contested decision in so far as, even though it was aware of the exemption at issue and of its implementation, in accordance with Decision 2001/224, it delayed in adopting Alumina Decision I. First, Ireland relies on the notification, at the beginning of 1983, of the exemption at issue to the Commission, which then adopted a positive decision on it. Second, it relies on the sending to the Commission, from 1995 onwards, of periodic information on the estimated amounts of the aid at issue, which was reproduced by the Commission for its aid notifications to the World Trade Organisation (WTO). Third, it cites the authorisation decisions adopted in 1997, 1999 and 2001 by the Council, acting unanimously on a proposal from the Commission. Fourth, it invokes the lack of a Commission proposal to the Council, under Article 8(5) of Directive 92/81, which was adopted pursuant to the lex specialis of Article 93 EC. Fifth, it relies on the Commission’s failure to bring an action for annulment, pursuant to Article 230 EC, against Decision 2001/224. Sixth, it refers to the Commission’s delay in adopting Alumina Decision I, contrary to the requirement that action must be taken within a reasonable time, that decision having been adopted more than 43 months after the Commission’s receipt, in April 2002, of its reply to the last request for additional information sent by that institution. Seventh, it relies on the Commission’s statements and on the Council’s authorisation decisions throughout the duration of the formal investigation procedure, which permitted the inference that the aid at issue had been authorised. Eighth, it refers to the Commission’s conduct, which, at all times, treated the aid at issue as existing aid. Ninth, it invokes the Commission’s failure to adopt an injunction decision ordering suspension of the aid pursuant to Article 11(1) of Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article [88 EC] (OJ 1999 L 83, p. 1), which would have made it possible to mitigate the effects of the aid on the common market and the effects of the recovery of that aid on AAL. Ireland claims, moreover, that the Commission adopted the contested decision to counteract the effects of Decision 2001/224, which authorised Ireland to continue to apply the exemption at issue until 31 December 2006, even though the Commission had proposed that the Council extend that authorisation only until 31 December 2002. |
46 |
In the context of the second plea raised in support of the action in Case T‑69/06 RENV II, AAL complains that the Commission infringed the principle of legal certainty, as interpreted in case-law, and the principle of the effet utile of acts of the institutions, and overstepped the limits of its own power, in that the contested decision produces, in respect of the exemption at issue, effects contrary to those produced by Decision 2001/224 since, although, by this latter decision, the Council extended the authorisation given to Ireland to continue applying the exemption at issue until 31 December 2006, Alumina Decision I states that the aid granted on the basis of the exemption at issue was partially incompatible with the common market and had, therefore, to be recovered from its recipient, except in respect of the period from 17 July 1990 to 2 February 2002. In that regard, first, AAL relies on Directive 92/81, adopted in accordance with the lex specialis constituted by Article 93 EC, which permitted Ireland to derogate from the lex generalis of State aid rules, in accordance with Article 87(1) EC, in so far as the Council’s authorisation decisions were based, inter alia, on the finding that the exemption at issue did not affect competition or lead to distortions of the operation of the common market. Second, it cites the Commission’s failure to have recourse to the procedure provided for in Article 8(5) of Directive 92/81 for resolving any problems of distortion of competition connected with the exemption at issue, as authorised by the Council, or to bring an action for annulment, under Article 230 EC, against Decision 2001/224. Third, it relies on the proposal for a Council authorisation decision of 29 November 1999 and on Article 3 of the proposal for a Council authorisation decision of 15 November 2000, which show that the Commission did not envisage adopting a negative final State aid decision before the expiry of the Council authorisation decisions and that it did not call into question the aid at issue. Fourth, it cites the Council authorisation decisions before Decision 2001/224, which did not mention the possibility of a parallel application of State aid rules. Fifth, it refers to the inapplicability of recital 5 of Decision 2001/224 to the exemption at issue, which is existing aid, notified in January 1983. Sixth, it cites the Commission’s change in policy, stemming from the initiation of the formal investigation procedure relating to the exemption at issue, by decision of 30 October 2001, namely some 14 months before the expiry date of the authorisation to continue applying that exemption which it itself had proposed that the Council impose, 31 December 2002. Seventh, it invokes the illegality of the Commission’s conduct, when it adopted the contested decision, consisting in revoking the authorisation to apply the exemption at issue until 31 December 2006, issued by the Council in Decision 2001/224, and, accordingly, in depriving Directive 92/81 of all meaning and effet utile. |
47 |
In any event, AAL argues that, even in the context of the application of State aid rules alone, the Commission misused its powers in the contested decision in erroneously classifying the aid at issue as unlawful aid, even though it had been authorised by the Council. That conclusion is not altered by the fact that the Council granted a longer authorisation than that proposed by the Commission, since the Council acted lawfully, within the framework of its tax harmonisation powers. |
48 |
The Commission contends that the present pleas should be rejected as unfounded. |
49 |
As a preliminary point, it should be pointed out that, in so far as the fourth plea raised in support of the action in Case T‑50/06 RENV II relates to an implicit authorisation decision which was allegedly taken, in accordance with Article 4(6) of Regulation No 659/1999, after the notification of the exemption at issue to the Commission in the beginning of 1983 and enabled the notified aid to be converted into existing aid, that plea is indissociable from the first part of the first plea raised in support of the same action; accordingly, it is appropriate to refer to the examination of that plea (see paragraphs 135 to 163 below). |
50 |
Next, in so far as, under the same plea, Ireland appears to complain that the Commission frustrated the legitimate expectation that it itself had created, in the mind of AAL, that the exemption at issue was lawful, owing to the delay in the adoption of Alumina Decision I, that plea may be understood as alleging, in essence, infringement of the principle of protection of legitimate expectations. In that regard, it is indissociable from the third plea raised in support of the action in Case T‑50/06 RENV II; it is appropriate to refer to the examination of that plea (see paragraphs 205 to 263 below). |
51 |
Last, in so far as, in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, Ireland complains that the Commission delayed adopting the contested decision, it raises, in essence, a complaint alleging infringement of the principle that action must be taken within a reasonable time, similar to that relied on by AAL in the context of the fifth plea raised in support of the action in Case T‑69/06 RENV II, and which should be examined together with the latter plea (see paragraphs 264 to 273 below). |
52 |
Otherwise, the present pleas essentially pose the question of whether the Commission infringed the principles of legal certainty and of the effet utile of acts of the institutions, in that the contested decision produces legal effects contrary to those produced by Decision 2001/224, which expressly authorised Ireland to continue to apply the exemption at issue until 31 December 2006, in particular on the ground that that exemption did not give rise to a distortion of competition. |
53 |
Moreover, the second and fourth pleas raised in support of the action in Case T‑50/06 RENV II raise the question of a possible infringement of the principle of estoppel, linked to the contrary legal effects allegedly produced by Decision 2001/224 and the contested decision, and of a possible infringement of Article 8(5) of Directive 92/81, linked to the fact that, before adopting the contested decision, the Commission allegedly did not follow the procedure provided for in Article 8(5) of Directive 92/81, for the purposes of securing an alteration or abolition of Decision 2001/224. |
54 |
Furthermore, in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, Ireland invokes the Commission’s failure to adopt, in the present case, a suspension injunction for the aid at issue, pursuant to Article 11(1) of Regulation No 659/1999. |
55 |
Last, the fourth plea raised in support of the action in Case T‑50/06 RENV II and the second plea raised in support of the action in Case T‑69/06 RENV II requires the Court to ascertain whether a misuse of powers was committed by the Commission when adopting the contested decision. |
56 |
As regards, in the first place, the complaint alleging infringement of the estoppel principle, put forward in the context of the second and fourth pleas raised in support of the action in Case T‑50/06 RENV II, it should be noted that the estoppel principle is a common law principle that does not exist in EU law as such; that does not mean, however, that certain principles, such as the principles of legal certainty and of protection of legitimate expectations, and certain rules, such as the nemo potest venire contra factum proprium rule enshrined in EU law may not be regarded as connected or related to that principle. Accordingly, the present complaint must be rejected as unfounded in law in so far as it is based on an infringement of the estoppel principle, although that is without prejudice to the possibility of examining Ireland’s arguments where they may be deemed to support a plea deriving, in essence, from the principles of legal certainty or of protection of legitimate expectations. |
57 |
With regard, in the second place, to the complaints alleging infringement of the principles of legal certainty and of the effet utile of acts of the institutions, of an infringement of Article 8(5) of Directive 92/81 or an exceeding of competence, relied on in the context of the second pleas raised in support of the present actions or the fourth plea raised in support of the action in Case T‑50/06 RENV II, it is appropriate, first of all, to bear in mind that, pursuant to the principle of conferred powers enshrined in Article 5 EC and Article 7 EC, the European Community is to act within the limits of the powers conferred on it and the objectives assigned to it by the EC Treaty and each institution is to act within the limits of the powers conferred on it by that treaty. |
58 |
Moreover, according to the case-law, acts of the institutions are in principle presumed to be lawful and accordingly produce legal effects until such time as they are withdrawn, annulled in an action for annulment or declared invalid following a reference for a preliminary ruling or a plea of illegality (see, to that effect, judgments of 15 June 1994 in Commission v BASF and Others, C‑137/92 P, ECR, EU:C:1994:247, paragraph 48; 8 July 1999Chemie Linz v Commission, C‑245/92 P, ECR, EU:C:1999:363, paragraph 93; and 5 October 2004Commission v Greece, C‑475/01, ECR, EU:C:2004:585, paragraph 18). |
59 |
Last, it is important to note that the principle of legal certainty is a general principle of EU law (see order of 8 November 2007 in Fratelli Martini and Cargill, C‑421/06, EU:C:2007:662, paragraph 56 and the case-law cited). According to settled case-law, that principle aims to ensure that situations and legal relationships governed by EU law remain foreseeable (judgments of 10 April 2003 in Schulin, C‑305/00, ECR, EU:C:2003:218, paragraph 58, and 15 September 2005Ireland v Commission, C‑199/03, ECR, EU:C:2005:548, paragraph 69). To that end, it is essential that the institutions observe the principle that they may not alter measures which they have adopted and which affect the legal and factual situation of persons, meaning that they may amend such acts only in accordance with the rules on competence and procedure (see judgment of 21 October 1997 in Deutsche Bahn v Commission, T‑229/94, ECR, EU:T:1997:155, paragraph 113 and the case-law cited). Observance of the principle of legal certainty also requires that the institutions avoid, as a matter of principle, inconsistencies that might arise in the implementation of the various provisions of EU law. This is all the more necessary when those provisions pursue the same objective, such as undistorted competition in the common market (see, to that effect and by analogy, judgments of 15 June 1993 in Matra v Commission, C‑225/91, ECR, EU:C:1993:239, paragraphs 41 and 42, and 31 January 2001RJB Mining v Commission, T‑156/98, ECR, EU:T:2001:29, paragraph 112 and the case-law cited). |
60 |
Article 8(5) of Directive 92/81 is worded as follows: ‘If the Commission considers that the exemptions or reductions provided for in paragraph 4 are no longer sustainable, particularly in terms of fair competition or distortion of the operation of the internal market, or Community policy in the area of protection of the environment, it shall submit appropriate proposals to the Council. The Council shall take a unanimous decision on these proposals.’ |
61 |
In the present case, as the Commission correctly notes, the reasoning behind the present complaints is directly refuted by the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812). |
62 |
In paragraphs 45 to 48 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), the Court of Justice drew a clear distinction between the respective powers of the Council and the Commission in the field of harmonisation of legislation relating to excise duties, on the one hand, and in the area of State aid, on the other. It also held that the purpose and scope of the procedure laid down in Article 8(4) of Directive 92/81 differed from those of the rules established in Article 88 EC. |
63 |
In paragraph 49 of that judgment, it thus concluded that a Council decision authorising a Member State, in accordance with Article 8(4) of Directive 92/81, to introduce an exemption from excise duties could not have the effect of preventing the Commission from exercising the powers conferred on it by the EC Treaty and, consequently, setting in motion the procedure laid down in Article 88 EC in order to review whether that exemption constituted State aid and, on the conclusion of that procedure, if appropriate, to adopt a decision such as Alumina Decision I. |
64 |
The Court of Justice further clarified, in paragraph 50 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), that the fact that the Council’s authorisation decisions granted full exemptions from excise duties while setting detailed conditions of a geographical and temporal nature and that those conditions had been strictly respected by the Member States had no effect on the division of powers between the Council and the Commission and therefore could not deprive the Commission of the right to exercise its powers. |
65 |
In paragraph 51 of the same judgment, it noted moreover that respect for that division of powers prompted recital 5 of Decision 2001/224, which was in force in the period for which the contested decision ordered the recovery of the aid at issue, to state that Decision 2001/224 was to be without prejudice to the outcome of any procedures that might be initiated under Articles 87 EC and 88 EC and that it did not override ‘the requirement for Member States to notify instances of potential State aid to the Commission’. |
66 |
Last, in paragraphs 52 and 53 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), the Court of Justice again indicated that the fact that the Council’s authorisation decisions had been adopted on a proposal from the Commission and that the Commission had never used the powers available to it, under Article 8(5) of Directive 92/81 or Articles 230 EC and 241 EC, in order to secure the abolition or alteration of those authorisation decisions could not preclude the exemptions from excise duty from being classified as State aid, within the meaning of Article 87(1) EC, if the conditions governing the existence of State aid were met. |
67 |
Pursuant to the second paragraph of Article 61 of the Statute of the Court of Justice of the European Union, where a case is referred back to the General Court, that Court is to be bound by the decision of the Court of Justice on points of law. In view of paragraph 54 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), it must be stated that the grounds referred to in paragraphs 62 to 66 above constitute the necessary support for the operative part of that judgment, by which the Court of Justice set aside the judgment in Ireland v Commission, cited in paragraph 25 above (EU:T:2012:134), and referred the Alumina I cases back to the General Court. |
68 |
However, it is apparent from those grounds that, in setting in motion the procedure laid down in Article 88 EC in order to determine whether the exemption at issue constituted State aid and in adopting, on the conclusion of that procedure, Alumina Decision I, the Commission was merely exercising the powers conferred on it by the EC Treaty in the area of State aid and that, in so doing, it could not have encroached upon the competences vested in the Council by the EC Treaty in the area of the harmonisation of legislation relating to excise duties or the acts adopted by the Council in the exercise of those powers. |
69 |
It follows that, in implementing, without first initiating the procedure provided for in Article 8(5) of Directive 92/81, the procedure laid down in Article 88 EC, in order to determine whether the exemption at issue constituted State aid, and in adopting, on the conclusion of that procedure, Alumina Decision I even though Article 1(2) of Decision 2001/224 explicitly authorised Ireland to continue applying the exemption at issue until 31 December 2006, the Commission could not infringe the principles of legal certainty and of the effet utile of acts of the institutions, or indeed, as Ireland claims, Article 8(5) of Directive 92/81. The Council’s authorisation decisions, adopted on a proposal from the Commission, could produce effects only within the area covered by the rules in the field of harmonisation of legislation relating to excise duties and did not predetermine the effects of any decision, such as Alumina Decision I, that could be adopted by the Commission in the exercise of its powers in the area of State aid. |
70 |
In addition, it follows from paragraphs 52 and 53 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), in which the Court of Justice notes that the concept of State aid corresponds to an objective situation and cannot depend on the conduct or statements of the institutions, that the fact that the Commission had taken the view, at the time when the Council adopted the authorisation decisions, that the exemptions from excise duty did not give rise to a distortion of competition and did not impede the proper functioning of the common market could not preclude those exemptions from being classified as State aid, within the meaning of Article 87(1) EC, if the conditions governing the existence of State aid were met. |
71 |
It follows a fortiori from the approach adopted by the Court of Justice that the Commission was not bound, for the purpose of the classification of the exemptions from excise duty as State aid, by the Council’s assessments, in its decisions in the field of harmonisation of legislation relating to excise duties, according to which those exemptions did not give rise to a distortion of competition and did not impede the proper functioning of the common market. |
72 |
AAL therefore has no basis to argue that the Commission exceeded its powers in adopting the contested decision. The applicants thus have no basis to argue that the contested decision produces legal effects contrary to those produced by Decision 2001/224. |
73 |
In so far as, in the context of the second plea raised in support of the action in Case T‑69/06 RENV II, AAL complains, in essence, that the Commission classified the exemption at issue as illegal aid, even though it had been authorised by the Council, it is sufficient, in order to reject that complaint as unfounded, to recall that, as indicated in paragraph 49 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), the Council’s authorisation decision, under the harmonisation rules for legislation relating to excise duties, could not have the effect of precluding the Commission from exercising its powers in the area of State aid and from adopting, on the conclusion of the procedure laid down in Article 88 EC, a decision such as the contested decision if it deemed it necessary. |
74 |
Accordingly, it is necessary to reject as unfounded the complaints alleging infringement of the principles of legal certainty and of the effet utile of acts of the institutions, infringement of Article 8(5) of Directive 92/81 or an exceeding of competence. |
75 |
As regards, in the third place, the complaints alleging misuse of powers by the Commission, put forward in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II and the second plea raised in support of the action in Case T‑69/06 RENV II, it should be borne in mind that, according to settled case-law, the concept of misuse of powers has a precisely defined scope in EU law and refers to cases where an administrative authority has used its powers for a purpose other than that for which they were conferred on it. A decision may amount to a misuse of powers only if it appears, on the basis of objective, relevant and consistent evidence, to have been taken for purposes other than those stated (see judgment of 9 September 2008 in Bayer CropScience and Others v Commission, T‑75/06, ECR, EU:T:2008:317, paragraph 254 and the case-law cited). |
76 |
In the present case, the applicants do not provide, with a view to proving the existence of a misuse of powers, objective, relevant and consistent evidence supporting the conclusion that the contested decision was taken for purposes other than those stated, namely the recovery of State aid incompatible with the common market, within the meaning of Article 87(3) EC. |
77 |
Therefore, the complaints alleging misuse of powers by the Commission must also be rejected as unfounded. |
78 |
In the fourth place, in so far as, in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, Ireland invokes the Commission’s failure to adopt, in the present case, a suspension injunction for the aid at issue, pursuant to Article 11(1) of Regulation No 659/1999, it should be noted that, according to that provision, ‘the Commission may, after giving the Member State concerned the opportunity to submit its comments, adopt a decision requiring the Member State to suspend any unlawful aid until the Commission has taken a decision on the compatibility of the aid with the common market’. |
79 |
Article 11(1) of Regulation No 659/1999 does not require the Commission, if certain conditions are fulfilled, to adopt a suspension injunction, but provides only that it may adopt such an injunction, where it deems it necessary. It follows that Ireland has no basis to argue that the Commission, which did not deem it necessary, in the present case, to adopt a suspension injunction, infringed Article 11(1) of Regulation No 659/1999. |
80 |
Consequently, the complaint alleging, in essence, infringement of Article 11(1) of Regulation No 659/1999 must be rejected. |
81 |
Without prejudice to the complaints which should be examined either in the context of other pleas (see paragraphs 49 and 50 above) or separately (see paragraph 51 above), since the other complaints put forward in the context of the second pleas raised in support of the present actions and the fourth plea raised in support of the action in Case T‑50/06 RENV II have been rejected in their entirety, those pleas must in turn be rejected as unfounded. |
The third plea, alleging infringement of the requirements under Article 3(1)(m) EC and Article 157 EC, raised in support of the action in Case T‑69/06 RENV II
82 |
AAL claims that the Commission infringed the requirements under Article 3(1)(m) EC and Article 157 EC in that, instead of assisting Community enterprises to become competitive, the effect of the contested decision rendered the Community less competitive and put it at a competitive disadvantage in the global marketplace, where it exported the majority of its production output. The Council’s authorisation decisions were predicated on there being no distortion of competition as a result of the exemption at issue, which the Commission initially accepted and which was even stated in the fourth recital of Decision 92/510. |
83 |
The Commission contends that the present plea should be rejected as unfounded. |
84 |
The present plea essentially poses the question of whether, in adopting the contested decision, the Commission infringed the requirements under Article 3(1)(m) EC and Article 157 EC, in so far as it prevented the application of a measure, namely the exemption at issue, which was intended to strengthen AAL’s competitiveness in the world market for the production of alumina, without giving rise to a distortion of competition, as is said to be evident from Decision 2001/224. |
85 |
Article 3 EC provides inter alia as follows: ‘For the purposes set out in Article 2, the activities of the Community shall include, as provided in this Treaty and in accordance with the timetable set out therein: …
|
86 |
Article 157 EC provides inter alia as follows: ‘1. The Community and the Member States shall ensure that the conditions necessary for the competitiveness of the Community’s industry exist. For that purpose, in accordance with a system of open and competitive markets, their action shall be aimed at:
… 3. The Community shall contribute to the achievement of the objectives set out in paragraph 1 through the policies and activities it pursues under other provisions of this Treaty. The Council, acting in accordance with the procedure referred to in Article 251 [EC] and after consulting the Economic and Social Committee, may decide on specific measures in support of action taken in the Member States to achieve the objectives set out in paragraph 1. This Title shall not provide a basis for the introduction by the Community of any measure which could lead to a distortion of competition.’ |
87 |
As the Commission correctly argues, Article 3 EC, in paragraph (1)(g) thereof, also provided that the activities of the Community were to include ‘a system ensuring that competition in the internal market [wa]s not distorted’. In addition, Article 157 EC stated that it did not provide a basis for the introduction by the Community of any measure which could lead to a distortion of competition. |
88 |
Although the Court of Justice found, in paragraph 52 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), that, at the time when the Council adopted the authorisation decisions in application of the rules in the field of harmonisation of tax legislation, the Commission had taken the view that the exemption at issue did not give rise to a distortion of competition and did not impede the proper functioning of the common market, it also noted, in paragraph 53 of that judgment, that that did not preclude that exemption from being classified as State aid, within the meaning of Article 87(1) EC, if the conditions governing the existence of State aid were met, it being observed that the concept of State aid corresponds to an objective situation and cannot depend on the conduct or statements of the institutions. |
89 |
In Alumina Decision I, the Commission found that the exemption at issue had to be classified as State aid, within the meaning of Article 87(1) EC, particularly because, as noted in recitals 61 and 62 of the decision, it could be assumed to distort or threaten to distort competition, even if significant parts of alumina production were consumed at aluminium plants, in so far as the exemption at issue was explicitly intended to strengthen the competitiveness of the beneficiaries vis-à-vis their competitors, particularly Community ones, established in Greece, Spain, Germany and Hungary (as from Hungary’s accession to the European Union, on 1 May 2004), by reducing their production costs. |
90 |
In the context of the present plea, AAL merely notes that the assessment of the Commission referred to in paragraph 89 above conflicts with that underlying the authorisation decisions adopted by the Council, on a proposal from the Commission, in the area of the harmonisation of tax legislation, without specifically contesting the substance of that assessment. |
91 |
In so far as, for the reasons set out in paragraph 88 above, the Commission was not bound, in the present case, by the assessments contained in the authorisation decisions adopted by the Council, on its proposal, in the field of harmonisation of tax legislation, it must be stated that it did not infringe Article 3(1)(m) EC and Article 157 EC in adopting the contested decision. |
92 |
Accordingly, the third plea raised in support of the action in Case T‑69/06 RENV II must be rejected as unfounded. |
93 |
This rejection is without prejudice to the examination which will be carried out, in the context of the sixth plea raised in support of the same action, of whether the Commission breached its obligation to state reasons and infringed Article 87(1) EC in finding, in recitals 61 and 62 of Alumina Decision I, that the condition that competition and trade between Member States be affected was, in the present case, fulfilled (see paragraphs 94 to 131 below). |
The sixth plea, alleging breach of the obligation to state reasons and infringement of Article 87(1) EC, raised in support of the action in Case T‑69/06 RENV II
94 |
In the first place, AAL claims that the Commission breached its obligation to state reasons, in the contested decision, in that it did not provide adequate reasons regarding the observance of certain conditions for classifying the aid at issue as State aid, within the meaning of Article 87(1) EC, namely the condition that trade between Member States be affected and that competition be distorted. According to the wish expressed by certain members of the Commission, it should have set out, in the contested decision, the reasons why, following a full and current economic analysis of the effects of the aid at issue on competition and trade between Member States, it reached the conclusion that the abovementioned conditions were, in the present case, fulfilled. |
95 |
In the second place, AAL claims that the Commission infringed Article 87(1) EC, in the contested decision, in that it incorrectly found, owing to the lack of a thorough economic analysis, that the aid at issue gave it an advantage, that it affected trade between Member States or that it distorted or threatened to distort competition. In that regard, first, AAL invokes the Commission’s failure to take into account, when analysing the effects on trade and commerce between Member States, in recital 62 of Alumina Decision I, the fact that there were two different products, namely: SGA and CGA, whereas, as a producer of SGA, it is essentially in competition with non-European producers, not with other European producers, especially those producing CGA. Second, it alleges an incorrect view of the situation as indicated by the Commission in recital 61 of Alumina Decision I, where it states that the aid at issue was intended to strengthen AAL’s competitiveness vis-à-vis its competitors by reducing its costs, which was true only in relation to non-European producers, and not to European alumina producers, between whom the degree of competition was very low, since the Community was a net importer of alumina and a significant proportion of Community production of alumina was captive. Third, it cites the Commission’s failure to take into account the fact that European alumina producers, inter alia those established in Germany, enjoyed exemptions on the power they used, which was already less expensive, and the fact that, given the different domestic licensing and environmental laws, AAL was at a cost disadvantage compared with other European alumina producers. |
96 |
The Commission contends that the present plea should be rejected as unfounded. |
97 |
In that regard, it should be borne in mind that, according to the case-law, the obligation laid down in Article 253 EC to state adequate reasons is an essential procedural requirement that must be distinguished from the question whether the reasoning is well founded, which goes to the substantive legality of the measure at issue (see judgments of 29 September 2011 in Elf Aquitaine v Commission, C‑521/09 P, ECR, EU:C:2011:620, paragraph 146 and the case-law cited, and 14 May 2014Donau Chemie v Commission, T‑406/09, ECR, EU:T:2014:254, paragraph 28 and the case-law cited). |
98 |
It is therefore appropriate to address, in the first place, the complaint alleging breach of the obligation to state reasons, laid down in Article 253 EC, then, in the second place, the complaint alleging infringement of Article 87(1) EC. |
99 |
As regards, in the first place, the complaint alleging breach of the obligation to state reasons laid down in Article 253 EC, it is necessary to point out that, according to the case-law, the statement of reasons required by Article 253 EC must be appropriate to the measure at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted that measure in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent court to exercise its power of review (see judgment of 2 April 1998 in Commission v Sytraval and Brink’s France, C‑367/95 P, ECR, EU:C:1998:154, paragraph 63 and the case-law cited). The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations (see Commission v Sytraval and Brink’s France, EU:C:1998:154, paragraph 63 and the case-law cited). |
100 |
Applied to the classification of a measure as State aid, the obligation to state reasons requires that the reasons which led the Commission to consider that the measure concerned falls within the scope of Article 87(1) EC be stated (see judgment of 15 June 2010 in Mediaset v Commission, T‑177/07, ECR, EU:T:2010:233, paragraph 144 and the case-law cited), which prohibits aid which affects trade between Member States and distorts or threatens to distort competition (judgment of 4 September 2009 in Italy v Commission, T‑211/05, ECR, EU:T:2009:304, paragraph 151). |
101 |
With regard to the reasons that should, in that respect, be provided by the Commission, they must be determined by reference to the requirements imposed by the case-law for assessing compliance with the conditions that trade between Member States be affected and that competition be distorted, as recalled in paragraphs 112 to 115 below. |
102 |
Thus, the Court must assess, in the light of the case-law cited in paragraphs 99 and 100 above, on the one hand, and in paragraphs 112 to 115 below, on the other, whether the Commission gave sufficient reasons for the contested decision, as regards compliance with the conditions that trade between Member States be affected and that competition be distorted. |
103 |
In the present case, in recitals 60 to 62 of the contested decision, the Commission provided the following reasons:
|
104 |
In so far as, in recital 62 of the contested decision, the Commission refers to ‘alumina (both SGA and CGA)’ it is necessary to point out that, in recital 16 of that decision, it had indicated the following: ‘… In several merger decisions, the Commission has found that there are two separate product markets: smelter-grade alumina (hereinafter “SGA”) and chemical-grade alumina (hereinafter “CGA”). CGA is a much higher value-added product than SGA. While the geographical market for SGA is worldwide, that for CGA is not wider than Europe.’ |
105 |
In recitals 61 and 62 of the contested decision, the Commission found that, in accordance with the analyses contained in Commission Decision 2002/174/EC of 3 May 2000 declaring a concentration to be compatible with the common market and the EEA Agreement (Council Regulation (EEC) No 4064/89) (Case No COMP/M.1693 — Alcoa/Reynolds) (OJ 2002 L 58, p. 25; ‘the Alcoa/Reynolds decision’), cited in footnote in recital 16 of the contested decision, SGA and CGA comprised two separate markets, both with a European dimension, since they involved not only producers established in Ireland, Italy and France, but also ones established in Greece, Spain, Germany and Hungary (as from 1 May 2004). It also found that alumina (both SGA and CGA) was the subject of trade between Member States, which involved, in principle, the limited proportion of alumina production not consumed at aluminium plants located close by (‘surplus alumina’), which was offered to third parties on the merchant market, as opposed to ‘captive alumina’, which was used internally by integrated producers, according to the analysis carried out in recital 13 of the Alcoa/Reynolds decision. |
106 |
In addition, in recitals 60 and 61 of the contested decision, the Commission indicated that the exemptions from excise duty, such as the exemption at issue, reduced the cost of one important input used by those alumina producers which benefited from them, namely those established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia, which amounted to the view, even if the Commission did not expressly state so in the contested decision, that the aid at issue was operating aid granted to those producers, whose productivity was increased vis-à-vis other European alumina producers, not benefiting from those exemptions, established in Greece, Spain and Germany. |
107 |
Last, in recital 61 of the contested decision, the Commission refuted the objections that had been raised by the beneficiaries, including AAL, and by the French Republic during the administrative procedure. |
108 |
In the light of those findings, the Commission took the view, in recital 62 of the contested decision, that it could be assumed, in the present case, that the aid at issue affected trade between Member States and distorted or threatened to distort competition. |
109 |
In view of the case-law cited in paragraphs 99 and 100 above and in paragraphs 112 to 115 below, the Commission did give sufficient reasons for the contested decision, as regards compliance with the conditions that trade between Member States be affected and that competition be distorted, in stating, in a succinct but clear manner, the reasons why, given the existence of trade between Member States and markets with a European dimension in surplus alumina (SGA and CGA) and of the fact that the aid at issue was operating aid, it could be assumed that that aid was liable to affect trade and to distort competition in those markets, by strengthening the competitive position of alumina producers established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia, vis-à-vis other European alumina producers established in Greece, Spain and Germany. |
110 |
Accordingly, the complaint alleging breach of the obligation to state reasons laid down in Article 253 EC must be rejected as unfounded. |
111 |
As regards, in the second place, the complaint alleging infringement of Article 87(1) EC, AAL essentially claims that the Commission erred in law in the classification of State aid, within the meaning of Article 87 EC, in that it found that the aid at issue conferred an advantage on it, affected trade between Member States and distorted or threatened to distort competition. |
112 |
In that regard, first of all, it must be pointed out that, according to the case-law, in assessing the conditions that trade between Member States be affected and that competition be distorted, the Commission is required, not to establish that such aid has a real effect on trade between Member States and that competition is actually being distorted, but only to examine whether that aid is liable to affect such trade and distort competition (see judgments of 9 September 2009 in Holland Malt v Commission, T‑369/06, ECR, EU:T:2009:319, paragraph 37 and the case-law cited, and Italy v Commission, cited in paragraph 100 above, EU:T:2009:304, paragraph 152 and the case-law cited). It follows that the Commission is not required to carry out an economic analysis of the actual situation on the relevant markets, of the market share of the undertakings in receipt of the aid, of the position of competing undertakings or of trade flows between Member States (see judgment in Mediaset v Commission, cited in paragraph 100 above, EU:T:2010:233, paragraph 145 and the case-law cited). |
113 |
Next, it is apparent from the case-law that the conditions that trade between Member States must be affected and competition distorted are as a general rule inextricably linked (judgments of 4 April 2001 in Regione Autonoma Friuli-Venezia Giulia v Commission, T‑288/97, ECR, EU:T:2001:115, paragraph 41, and 15 June 2000Alzetta and Others v Commission, T‑298/97, T‑312/97, T‑313/97, T‑315/97, T‑600/97 to T‑607/97, T‑1/98, T‑3/98 to T‑6/98 and T‑23/98, ECR, EU:T:2000:151, paragraph 81). In particular, the case-law states that any grant of aid to an undertaking pursuing its activities in the common market is liable to cause distortion of competition and affect trade between Member States (see judgments of 11 June 2009 in ASM Brescia v Commission, T‑189/03, ECR, EU:T:2009:193, paragraph 68 and the case-law cited, and Italy v Commission, T‑222/04, ECR, EU:T:2009:194, paragraph 43 and the case-law cited). |
114 |
In addition, with regard to the condition relating to distortion of competition, the case-law lays down a presumption that operating aid of an undertaking, that is to say, aid intended to relieve an undertaking of the expenses which it would itself normally have had to bear in its day-to-day management or its usual activities, provides that undertaking with artificial financial support which, in principle, distorts competition in the sectors in which it is granted (judgments of 8 June 1995 in Siemens v Commission, T‑459/93, ECR, EU:T:1995:100, paragraphs 48 and 77, and 29 September 2000CETM v Commission, T‑55/99, ECR, EU:T:2000:223, paragraph 83; see also, to that effect, judgments of 19 September 2000 in Germany v Commission, C‑156/98, ECR, EU:C:2000:467, paragraph 30, and 5 October 2000Germany v Commission, C‑288/96, ECR, EU:C:2000:537, paragraphs 77 and 78). It follows that, where the Commission finds the existence of operating aid, it is not required to give the reasons why that aid distorts or threatens to distort competition (see, to that effect, judgment in Germany v Commission, EU:C:2000:537, paragraph 86). |
115 |
Last, so far as concerns the conditions that trade between Member States be affected and that competition be distorted, the case-law states that, when State financial aid strengthens the position of an undertaking compared with other undertakings competing in trade between Member States the latter must be regarded as affected by that aid (see judgments of 14 September 1994 in Spain v Commission, C‑278/92 to C‑280/92, ECR, EU:C:1994:325, paragraph 40 and the case-law cited, and Italy v Commission, cited in paragraph 100 above, EU:T:2009:304, paragraph 153 and the case-law cited). There is no threshold or percentage below which trade between Member States can be said not to be affected (see judgments in ASM Brescia v Commission, cited in paragraph 113 above, EU:T:2009:193, paragraph 69 and the case-law cited, and Italy v Commission, cited in paragraph 113 above, EU:T:2009:194, paragraph 69 and the case-law cited). In particular, the condition that the aid must be capable of affecting trade between Member States does not depend on the scale of the field of activity concerned (judgment of 24 July 2003 in Altmark Trans and Regierungspräsidium Magdeburg, C‑280/00, ECR, EU:C:2003:415, paragraph 82). |
116 |
As regards, first of all, the complaint by which AAL disputes, in essence, that the condition of conferral of an advantage on the beneficiary of the aid was satisfied, it should be pointed out that the aim of Article 87 EC is to prevent trade between Member States from being affected by advantages granted by public authorities which, in various forms, distort or threaten to distort competition by favouring certain undertakings or certain products (see judgment of 15 March 1994 in Banco Exterior de España, C‑387/92, ECR, EU:C:1994:100, paragraph 12 and the case-law cited). |
117 |
It is settled case-law that the concept of aid embraces not only positive benefits, such as subsidies themselves, but also interventions which, in various forms, mitigate the charges which are normally included in the budget of an undertaking and which, without therefore being subsidies in the strict meaning of the word, are similar in character and have the same effect (judgment of 13 June 2000 in EPAC v Commission, T‑204/97 and T‑270/97, ECR, EU:T:2000:148, paragraph 65 and the case-law cited). It follows that a measure by which the public authorities grant to certain undertakings a tax exemption which, although not involving a transfer of State resources, places the persons to whom the tax exemption applies in a more favourable financial situation than other taxpayers constitutes State aid within the meaning of Article 87(1) EC (judgment in Banco Exterior de España, cited in paragraph 116 above, EU:C:1994:100, paragraph 14). |
118 |
In the present case, it is apparent from recital 60 of the contested decision that the advantage conferred on AAL by the exemption at issue arose, according to the Commission, from the fact that ‘the exemptions from excise duty reduce[d] the cost of one important input’ used by their beneficiaries, ‘which [were] placed in a more favourable financial position than other undertakings using mineral oils in other industries or regions’. |
119 |
In view of the case-law cited in paragraph 117 above, the Commission thus was justified in finding that the exemptions from excise duty abolished a charge, namely the excise duty on mineral oils, which normally had to be included in the budget of undertakings which, like AAL, used those oils as fuel for the production of alumina in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia, and, therefore, conferred on those undertakings an advantage vis-à-vis other undertakings also using mineral oils in their production process, in other sectors or in other regions. |
120 |
That finding is not called into question by the argument of AAL based, in essence, on the compensatory function performed by the exemption at issue, taking into account the objective competitive disadvantage it claims it suffered, in terms of production costs, compared with other European alumina producers, particularly those established in Germany. It is sufficient to note in that regard that, according to settled case-law, the fact that a Member State seeks to approximate, by unilateral measures, the conditions of competition in a particular sector of the economy to those prevailing in other Member States cannot deprive the measures in question of their character as aid (see judgment of 29 April 2004 in Italy v Commission, C‑372/97, ECR, EU:C:2004:234, paragraph 67 and the case-law cited). |
121 |
Accordingly, the complaint alleging failure to comply with the condition that an advantage be conferred on the beneficiary of aid must be rejected as unfounded. |
122 |
So far as concerns, next, the complaint by which AAL denies, in essence, that the condition of distortion of competition was satisfied, it should be recalled that, in accordance with the case-law cited in paragraphs 113 and 114 above, first, any grant of aid to an undertaking pursuing its activities in the common market is liable to cause distortion of competition and, second, the operating aid of an undertaking, namely aid intended to relieve an undertaking of the expenses which it would normally have had to bear in its day-to-day management or its usual activities, is assumed to distort the conditions of competition in the sectors in which it is granted. |
123 |
In the present case, it is apparent from recital 60 of the contested decision that, according to the Commission, ‘the exemptions from excise duty reduce[d] the cost of one important input’ used by alumina producers established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia. That finding is well founded, in so far as the undertakings which, like AAL, used mineral oils as fuel for alumina production in the aforementioned regions would normally have had to pay excise duty on mineral oils and, accordingly, have the cost associated with that duty included in their budget. It is therefore also with good reason that, as has been noted in paragraph 106 above, the Commission implicitly but necessarily considered, in recital 60 of the contested decision, that the exemptions from excise duty corresponded to operating aid, within the meaning of the case-law cited in paragraph 114 above, benefiting alumina producers established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia. Last, as has been indicated in paragraph 105 above, the Commission found, in recitals 61 and 62 of the contested decision, that there was, generally, trade between Member States and markets with a European dimension in surplus alumina (SGA and CGA). Those findings are based, in particular, on an economic analysis carried out, by the Commission, in the Alcoa/Reynolds decision (see paragraph 105 above). However, in the context of the present action, AAL has provided no economic analysis, supported by evidence, such as to call into question the validity of the general economic analysis contained in the Alcoa/Reynolds decision, to which the contested decision refers. Accordingly, the validity of the Alcoa/Reynolds analysis cannot, in the present case, be called into question. In view of the entirety of the findings thus made by the Commission, in recitals 60 to 62 of the contested decision, it was justified in assuming, in accordance with the case-law cited in paragraphs 113 and 114 above, that the aid at issue distorted or threatened to distort, in the markets with a European dimension in surplus alumina (SGA and CGA), competition between alumina producers established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia, on the one hand, and European alumina producers established in Greece, Spain and Germany, on the other. |
124 |
As for AAL’s argument alleging, in essence, that the Commission did not properly understand the specific competition conditions prevailing in alumina markets (SGA and CGA), it is not such as to call into question the validity of the contested decision as regards compliance with the condition that competition be distorted. It should be recalled that, pursuant to the case-law cited in paragraph 112 above, the Commission was not required to carry out a precise economic analysis of the markets in question, and that, in the particular circumstances of the present case, where the exemption at issue was operating aid, it was moreover justified in assuming that it distorted competition, at least in relation to alumina (SGA and CGA) which was the subject of trade between Member States and whose markets had a European dimension (see paragraph 123 above). In so far as AAL complains that the Commission did not take into account the fact that a significant proportion of Community production was captive, its complaint has no basis in fact, since, in recital 62 of the contested decision, the Commission observed, in essence, that the trade between Member States involved only surplus alumina (SGA and CGA). |
125 |
Nor, in so far as AAL essentially claims to have been in competition not with other European alumina producers, but only with non-European alumina producers, is its argument such as to call into question the validity of the contested decision as regards compliance with the condition that competition be distorted. In that regard, it is sufficient to state that AAL’s claims are not supported and are, moreover, contradicted by its own assertions that the exemption at issue was supposed to enable compensation of the disadvantageous situation, in terms of costs, of an alumina producer, like AAL, established in Ireland vis-à-vis the situation of alumina producers established in other Member States, such as Germany. It is thus apparent from AAL’s own statements that it was in competition with other European alumina producers. |
126 |
Accordingly, the complaint alleging failure to comply with the condition that competition be distorted must be rejected as unfounded. |
127 |
Last, so far as concerns the complaint by which AAL denies, in essence, that the condition that there be an effect on trade between Member States was satisfied, it should be recalled that, in accordance with the case-law cited in paragraphs 113 and 115 above, first, any grant of aid to an undertaking pursuing its activities in the European market is liable to affect trade between Member States and, second, when aid granted by a Member State strengthens the position of an undertaking compared with other undertakings competing in trade between Member States, the latter trade must be regarded as affected by that aid. |
128 |
In the present case, as has been indicated in paragraph 123 above, the Commission found that there was, generally, trade between Member States and markets with a European dimension in surplus alumina (SGA and CGA). In addition, in so far as the exemptions from excise duty benefited only those alumina producers which, like AAL, were established in Ireland, in the Shannon region, in France, in the Gardanne region, and in Italy, in Sardinia, and not European alumina producers established in Greece, Spain and Germany, with which AAL was in competition (see paragraph 124 above), the Commission was justified in concluding that the aid at issue was liable to affect trade between Member States. |
129 |
So far as concerns the argument, raised by AAL, alleging, in essence, that the Commission disregarded the fact that a significant proportion of Community production was captive and that alumina (SGA and CGA) was not traded between the Member States, but between Member States and third States, the Community being a net importer of those products, that argument is not capable of calling into question the validity of the contested decision as regards compliance with the condition that trade between Member States must be affected. On the one hand, the complaint has no basis in fact in so far as it concerns captive alumina. As has already been indicated in paragraph 124 above, in recital 62 of the contested decision, the Commission, in essence, observed that the trade between Member States involved only surplus alumina (SGA and CGA). On the other hand, in so far as it concerns trade in alumina (SGA and CGA) between the Member States, the complaint is not supported and is even contradicted by AAL’s own statements, in its submissions, that ‘a small proportion [of its production was] sold in the form of alumina tri-hydrate as feedstock to a producer of chemical grade alumina … located in Germany’ and that ‘all alumina produced by AAL [wa]s exported via its marine terminal to markets outside Ireland, principally to the UK, Scandinavia and elsewhere in Europe’. It is therefore apparent from AAL’s own statements that it contributed to trade flows in surplus alumina (SGA and CGA) between Member States. |
130 |
Accordingly, the complaint alleging failure to comply with the condition that there be an effect on trade between Member States must be rejected as unfounded. |
131 |
Since all of the complaints put forward in the context of the sixth plea raised in support of the action in Case T‑69/06 RENV II have been rejected, that plea must in turn be rejected as unfounded in its entirety. |
The first pleas raised in support of the present action, alleging an error of law in the classification of the aid at issue in the light of Article 88 EC
132 |
In the context of the first pleas raised in support of the present actions, the applicants complain that the Commission committed an error of law, in the contested decision, in that it classified the aid at issue as new aid, within the meaning of Article 88(3) EC, rather than as existing aid, within the meaning of Article 88(1) EC, and in that it did not apply to that aid the procedure relating to existing aid schemes. |
133 |
The first plea raised in support of the action in Case T‑50/06 RENV II is divided into three alternative parts. The first part alleges, in essence, infringement of Article 88 EC and of the rule codified in Article 1(b)(iii) of Regulation No 659/1999 and, in essence, infringement of the procedural rules relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999. The second part alleges infringement of the provisions of Article 88 EC read in conjunction with Articles 1(b)(iv) and 15(3) of Regulation No 659/1999 and, in essence, infringement of the procedural rules relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999. The third part alleges, in essence, infringement of Article 88 EC and of the rule codified in Article 1(b)(i) of Regulation No 659/1999. |
134 |
The first plea raised in support of the action in Case T‑69/06 RENV II is also divided into three alternative parts. The first part alleges, in essence, infringement of Article 88 EC and of the rule codified in Article 1(b)(i) of Regulation No 659/1999. The second part alleges infringement of Article 88 EC and of the rule codified in Article 1(b)(iii) of Regulation No 659/1999. The third part alleges, in essence, infringement of the provisions of Article 88 EC read in conjunction with Articles 1(b)(iv) and 15(3) of Regulation No 659/1999. |
The first part of the first plea raised in support of the action in Case T‑50/06 RENV II and the second part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging infringement of Article 88 EC and of the rule codified in Article 1(b)(iii) of Regulation No 659/1999 and, in Case T‑50/06 RENV II, infringement of the procedural rules relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999
135 |
The applicants claim, in essence, that, in the contested decision, the Commission infringed Article 88 EC and the rule codified in Article 1(b)(iii) of Regulation No 659/1999 in that it failed to take into account, for the purposes of classifying the aid at issue as new aid within the meaning of Article 88(3) EC, the fact that that aid had to be regarded as having been authorised, since the Commission had not taken a decision on the exemption at issue within a reasonable period following its notification. In Case T‑50/06 RENV II, Ireland also alleges infringement of the procedural rules relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999. |
136 |
In that regard, first, Ireland relies on the letter of 6 May 1983, from which it is apparent that it accepted the Commission’s offer, made in the letter of 22 March 1983, to treat its letter of 28 January 1983, which informed the Commission of the planned exemption at issue, as notification, for the purposes of Article 88(2) EC. Second, it relies on the letter of 6 May 1983, by which it gave the Commission prior notice of the implementation of the exemption at issue, in accordance with the rule codified in Article 4(6) of Regulation No 659/1999. Third, it cites the Commission’s failure to take a decision within two months following notification of the exemption at issue, in accordance with the period codified in Article 4(5) of Regulation No 659/1999, or within a reasonable period following the prior notice of the implementation, and also the Commission’s inaction and silence until 1992, that is, for the nine years following those notifications. Fourth, it stresses the irrelevance of the fact that it implemented the exemption at issue without waiting for a formal decision from the Commission under the State aid rules, in the light of the fact that that decision was not taken within a reasonable period and that the exemption at issue was put into effect more than two months after it had been notified to the Commission, on 28 January 1983. Moreover, Ireland relies on the fact that the Commission conducted itself as if it considered the aid at issue to constitute existing aid. In that regard, in the first place, it refers to the clear and precise wording of the fourth recital of Decision 92/510, according to which ‘it [was] accepted by the Commission and by all Member States that all of [the] exemptions [were] well founded in terms of specific policies and [did] not give rise to distortions in competition or interfere with the working of the internal market’, which may be regarded as a positive decision in respect of the exemption at issue, notified on 28 January 1983, or, at the very least, as a declaration of principle indicating that the Commission’s doubts as to the compatibility of the aid at issue with the common market had already been allayed. In the second place, Ireland relies on the terminology employed in the fifth recital of Decision 97/425 and in recital 4 of Decision 1999/880, which is similar to that used by the Commission when it examines existing aid schemes, on the basis of Article 17 of Regulation No 659/1999. In the third place, it relies on the proposals for Council authorisation decisions of November 1999 and 2000 and on recital 5 of Decision 2001/224, which contained no warning as to the unlawfulness of the aid at issue. In the fourth place, it refers to the fact that, in any event, the Commission itself proposed that the Council authorise it to apply the exemption at issue after 1983. Furthermore, Ireland complains, in essence, that the Commission infringed the procedure relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999, in that it ordered recovery of the aid at issue with retroactive effect, without having regard to the fact that, as part of its constant review of existing aid, it was only empowered to require the elimination or modification of such aid within a period which it determined. |
137 |
First, AAL relies on the letter of 6 May 1983, from which it is apparent that Ireland accepted the Commission’s offer, made in the letter of 22 March 1983, to treat the letter of 28 January 1983, which informed the Commission of the planned exemption at issue, as a notification, for the purposes of Article 88(2) EC. Second, it cites the implementation of the exemption at issue approximately three months after the letter of 28 January 1983 had been sent to the Commission. Third, it relies on the letter of 6 May 1983, by which Ireland gave the Commission prior notice of the implementation of the exemption at issue, in accordance with the rule codified in Article 4(6) of Regulation No 659/1999. Fourth, it claims that the Commission’s argument that the exemption at issue was not implemented by Ireland and by AAL itself in strict accordance with the conditions laid down by the case-law (judgment of 11 December 1973 in Lorenz, 120/73, ECR, EU:C:1973:152) and subsequently codified in Regulation No 659/1999 may not be relied on against it, since the Commission itself derogated from that legal framework by offering to Ireland to consider its letter of 28 January 1983 as notification, thus denying itself the opportunity to take a position within a reasonable period of two months. In the alternative, it claims that the Commission’s argument relating to the allegedly incomplete nature of the notification may not be relied on against it, since, after being informed, by Ireland, that implementation of the aid was imminent, it waived its right to require, in the letter of 22 March 1983, further notification. Fifth, it cites the Commission’s inaction and silence until July 2000, that is, for the 17 years following the notification of the exemption at issue and the information it had received of its imminent implementation. Sixth, it invokes the Commission’s failure to mention the notification given on 28 January 1983, when it requested notification of the exemption on 17 July 2000 and initiated the formal investigation procedure on 30 October 2001 which led it to commit an error in the classification of the aid. Seventh, it refers to the fourth recital of Decision 92/510, which amounts to an acknowledgment, by the Commission, that the exemption at issue was existing aid. Eighth, it cites the situation which the Commission caused and accepted over a long period of time, which objectively requires the aid at issue to be classified as existing aid. |
138 |
The Commission contends that the present parts of the first pleas should be rejected as unfounded. |
139 |
In that regard, it is important, as a preliminary point, to point out that the EC Treaty institutes different procedures according to whether the aid is existing or new. Whereas new aid must, under Article 88(3) EC, be notified in advance to the Commission and cannot be implemented before the procedure has culminated in a final decision, existing aid may, under Article 88(1) EC, be duly implemented as long as the Commission has not found it to be incompatible (see judgment of 24 March 2011 in Freistaat Sachsen and Others v Commission, T‑443/08 and T‑455/08, ECR, EU:T:2011:117, paragraph 187 and the case-law cited). Existing aid may therefore only be the subject, should the situation arise, of a decision of incompatibility producing effects for the future (see judgment in Freistaat Sachsen and Others v Commission, EU:T:2011:117, paragraph 187 and the case-law cited). |
140 |
Furthermore, in so far as the applicants formally allege infringement of Article 1(b)(iii) of Regulation No 659/1999, it must be pointed out that, at the time when the Commission adopted the contested decision, the substantive rule contained in that provision had already entered into force, on 16 April 1999. Although, according to the case-law (judgments of 14 May 1975 in CNTA v Commission, 74/74, ECR, EU:C:1975:59, paragraphs 33 to 43; 26 June 1990Sofrimport v Commission, C‑152/88, ECR, EU:C:1990:259, paragraphs 16 and 17; and 5 October 1993Driessen and Others, C‑13/92 to C‑16/92, ECR, EU:C:1993:828, paragraphs 30 to 35), safeguarding the principles of legal certainty and of protection of legitimate expectations imposes limits on the immediate application of substantive rules, those limits cannot apply in the situation of unlawful aid or notified aid before it has been authorised by the Commission. In the system and logic underlying the control of State aid, the situation is not defined immediately and definitively by the notification or grant of aid, but remains ongoing pending the decision of the EU institutions. In that context, it is for the Commission to apply the substantive rules in force at the time when it gives its decision on the aid or aid scheme at issue or on the compatibility of the aid or scheme with the common market, the only rules on the basis of which the lawfulness of the decision it takes in that regard falls to be assessed (see, to that effect and by analogy, judgment of 11 December 2008 in Commission v Freistaat Sachsen, C‑334/07 P, ECR, EU:C:2008:709, paragraph 53). Therefore, at the time when the Commission adopted the contested decision, Article 1(b)(iii) of Regulation No 659/1999 was in force, so it is applicable in the present case. |
141 |
However, the procedural rules set out in Article 4(6) of Regulation No 659/1999, to which Article 1(b)(iii) of the same regulation refers, cannot govern procedural acts adopted before those rules’ entry into force, on 16 April 1999. According to the case-law, procedural rules are generally held to apply to all proceedings pending at the time when they enter into force (see, to that effect, judgments of 12 November 1981 in Meridionale Industria Salumi and Others, 212/80 to 217/80, ECR, EU:C:1981:270, paragraph 9, and 23 February 2006Molenbergnatie, C‑201/04, ECR, EU:C:2006:136, paragraph 31 and the case-law cited). However, at the time when the preliminary investigation procedure concerning the exemption at issue took place and when the aid at issue is said to have been authorised by the Commission, that is, in the course of 1983, those rules had not yet entered into force. It is nevertheless appropriate to take into account the fact that, as the Commission correctly recognised, in recital 67 of Alumina Decision I, Article 4(6) of Regulation No 659/1999 was inter alia aimed at codifying certain procedural rules which, in accordance with the case-law of the Court of Justice arising out of the judgment in Lorenz, cited in paragraph 137 above (EU:C:1973:152, paragraph 6) (‘the Lorenz case-law’), were applicable when the procedural acts relied on were adopted. According to that case-law, cited by AAL in Case T‑69/06 RENV II, Article 93(3) of the EC Treaty (later Article 88(3) EC) signified that, if the Commission, after being informed by a Member State of a plan to grant or alter aid, failed to initiate the contentious procedure provided for in Article 93(2) of the EC Treaty (later Article 88(2) EC) (or the formal investigation procedure) by giving notice to the Member State concerned to submit its comments, that State could, at the end of a period sufficient to enable its preliminary examination, grant the proposed aid, provided that it had given prior notice to the Commission, and that aid would then be governed by the rules concerning existing aid (judgment of 9 August 1994 in Namur-Les assurances du crédit, C‑44/93, ECR, EU:C:1994:311, paragraph 12). So far as concerns the period sufficient or reasonable to enable the Commission to carry out the preliminary examination (or preliminary investigation procedure), the Court of Justice indicated that it was appropriate to be guided by the period of two months provided in Article 173 of the EC Treaty and Article 175 of the EC Treaty (later Articles 230 EC and 232 EC) for bringing actions for annulment and failure to act (judgment in Lorenz, cited in paragraph 137 above, EU:C:1973:152, paragraph 6). |
142 |
It is therefore necessary to understand the complaints alleging infringement of Article 1(b)(iii) of Regulation No 659/1999 as complaints referring, essentially, to a breach of the Lorenz case-law. |
143 |
In the present case, the applicants essentially claim that the Commission erred, in the contested decision, in classifying the aid at issue as new aid and in ordering its recovery with retroactive effect, even though it constituted existing aid, within the meaning of the Lorenz case-law, because the Commission had failed to take a decision on the exemption at issue within a reasonable period following its notification. |
144 |
In the first place, it is appropriate to examine, primarily, whether the letter of 28 January 1983 could not be formally regarded as notification of the exemption at issue, within the meaning of Article 88(3) EC, and, in the alternative, whether that notification was incomplete, given Ireland’s failure to respond, in the letter of 6 May 1983, to the question the Commission had asked it in the letter of 22 March 1983, regarding the duration of the grant of aid to AAL. |
145 |
In that regard, it must be noted that, in reviewing the legality of acts, the Court cannot under any circumstances substitute its own reasoning for that of the author of the contested act (see, by analogy, judgment of 24 January 2013 in Frucona Košice v Commission, C‑73/11 P, ECR, EU:C:2013:32, paragraph 89 and the case-law cited). It follows that the Court cannot, without exceeding the limits of its power of review, rely, in order to reject a plea for annulment submitted to it, on grounds which did not form part of the contested decision (see, to that effect and by analogy, judgment in Frucona Košice v Commission, EU:C:2013:32, paragraph 88). |
146 |
In recital 67 of Alumina Decision I, the Commission observed the following: ‘… the aid cannot be deemed to be authorised pursuant to Article 4(6) of Regulation (EC) No 659/1999. France and Italy never notified the measures. In its letter of 6 May 1983, Ireland confirmed that the aid was only then being implemented and that its letter to the Commission could be regarded as a notification for the purposes of Article 93(3) of the [EC] Treaty. Ireland, however, never sent any formal prior notice to the Commission of its intention to implement the aid measure as provided for in Article 4(6) of Regulation (EC) No 659/1999. On the contrary, it put the measure into effect only one week after the letter of 6 May 1983 that invited the Commission to consider the aid as notified. Therefore, it appears to the Commission that the aid must be considered as unlawful aid within the meaning of Article 1(f) of Regulation (EC) No 659/1999. The French and Italian aids were also put into effect without awaiting approval by the Commission in breach of Article 88(3) of the Treaty. Member States cannot invoke the rules set out in Article 4(6) of Regulation (EC) No 659/1999 in respect of such aid. Even though Regulation (EC) No 659/1999 only entered into force in 1999, similar rules already applied before that date in accordance with the case-law of the Court of Justice.’ |
147 |
Moreover, in Article 5(5) of Alumina Decision I, the Commission inter alia ordered Ireland to recover the aid at issue, granted between 3 February 2002 and 31 December 2003, from its beneficiary, namely AAL. |
148 |
It is clear from recital 67 of Alumina Decision I that, although, in that decision, the Commission objected to the lack of notification from the French Republic and the Italian Republic of the exemptions from excise duty that they had applied, it never, however, criticised Ireland for not notifying it of the exemption at issue, but only for not sending it any formal prior notice, as required by the Lorenz case-law, of its intention to put that exemption into effect, which Ireland did only one week after sending the letter of 6 May 1983, by which it asked the Commission to consider the letter of 28 January 1983 as a notification. That is consistent with the fact that, in the letter of 6 May 1983, Ireland merely acquiesced to a proposal from the Commission in its letter of 22 March 1983 to treat the letter of 28 January 1983, by which Ireland had informed it of its plan to implement the exemption at issue, as a notification, in accordance with Article 93(3) of the EC Treaty. |
149 |
In so far as the ground of lack of notification or incomplete notification to the Commission, by Ireland, of the exemption at issue does not form part of the contested decision, the Court may not, without exceeding the limits of its power of review in an action for annulment, rely on such a ground in order to reject the first part of the first plea raised in support of the action in Case T‑50/06 RENV II. |
150 |
Accordingly, it is necessary to reject the arguments put forward by the Commission against the first part of the first plea raised in support of the action in Case T‑50/06 RENV II, alleging, primarily, failure to notify the exemption at issue, within the meaning of Article 88(3) EC, and, in the alternative, that the alleged notification was incomplete. |
151 |
In the second place, it is appropriate to examine the defence, put forward by the Commission against the second part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging, in essence, that only the letter of 6 May 1983 enabled it to consider the letter of 28 January 1983 as a notification of the exemption at issue, for the purposes of Article 88(3) EC, so the period should run from receipt of the letter of 6 May 1983. |
152 |
It is appropriate, in that respect, to point out that it is only by the letter of 6 May 1983 that Ireland asked the Commission to regard its letter of 28 January 1983 as a notification, in accordance with Article 93(3) of the EC Treaty, as proposed by the Commission, in the letter of 22 March 1983. The Commission is thus correct to argue that, before receipt of the letter of 6 May 1983, no formal notification of the aid at issue could be regarded as having occurred, with the result that a period sufficient or reasonable to enable it to carry out the preliminary examination of that aid could begin only from receipt of that letter. |
153 |
In the third place, it is appropriate to adjudicate on the defence, put forward by the Commission against the first part of the first plea raised in support of the action in Case T‑50/06 RENV II and the second part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging that the letter of 6 May 1983 could not, as the applicants claim, be regarded as prior notice of the implementation of the proposed aid, required by the case-law. |
154 |
In that regard, it is clear from both the terms and purposes of Article 93 of the EC Treaty (later Article 88 EC) that aid which could be properly put into effect in accordance with the conditions laid down in Article 93(3) of the EC Treaty, including those arising from the interpretation of that article given by the Court of Justice in its judgment in Lorenz, cited in paragraph 137 above (EU:C:1973:152, paragraphs 4 to 6) (judgments in Namur-Les assurances du crédit, cited in paragraph 141 above, EU:C:1994:311, paragraph 13, and 17 June 1999Piaggio, C‑295/97, ECR, EU:C:1999:313, paragraph 48) must in particular be regarded as existing aid within the meaning of Article 93(1) of the EC Treaty. In view of the procedural rules arising from the Lorenz case-law, the conversion of notified aid into existing aid is subject to two sufficient and necessary conditions. The first is that the Member State must give the Commission prior notice of implementation of the planned aid; the second is that the Commission must not initiate the contentious procedure under Article 93(2) of the EC Treaty in the two months following complete notification of the aid (see, to that effect, judgment of 15 February 2001 in Austria v Commission, C‑99/98, ECR, EU:C:2001:94, paragraph 84). |
155 |
In the present case, this Court need adjudicate only on the possible failure to comply with the condition regarding the giving of prior notice to the Commission, by the Member State, of the implementation of the proposed aid, the only condition examined by the Commission in recital 67 of the contested decision (see paragraph 146 above). |
156 |
Even considering that complete notification of the exemption at issue to the Commission, by Ireland, took place at the date when Ireland asked the Commission, by its letter of 6 May 1983, to regard its letter of 28 January 1983 as a notification, in accordance with Article 93(3) of the EC Treaty, as proposed by the Commission in the letter of 22 March 1983, the Commission had a period of two months, in view of the procedural rules arising from the Lorenz case-law, to initiate the formal investigation procedure. It follows from those rules that it is only upon the expiry of that period, namely, in principle, 7 July 1983, that Ireland could put the exemption at issue into effect (see, to that effect, judgment in Austria v Commission, cited in paragraph 154 above, EU:C:2001:94, paragraph 77), provided it gave prior notice to the Commission, the aid granted on the basis of that exemption then being governed by the rules concerning existing aid (judgment in Namur-Les assurances du crédit, cited in paragraph 141 above, EU:C:1994:311, paragraph 12). |
157 |
However, first, the letter of 6 May 1983, which confirmed the notification to the Commission of the exemption at issue, could not be regarded also as prior notice of the implementation of that exemption. Even assuming that prior notice could have been given before the expiry of the period of two months provided for initiating the formal investigation procedure, that is, at a time when, in any event, Ireland was not authorised to put the exemption at issue into effect, it must be stated that, in that letter, Ireland in no way informed the Commission that, if it did not respond, it would put the exemption at issue into effect, but merely acknowledged that the exemption at issue had to be notified, confirmed that it was notifying that exemption to the Commission and provided it with additional information on the exemption. Second, there is no indication in the Court’s file that, after the sending of the letter of 6 May 1983 and before the implementation of the aid at issue on 12 May 1983, Ireland sent the Commission a document capable of constituting prior notice of the implementation of that exemption. |
158 |
Accordingly, the Commission is correct to argue that not all of the conditions required by the case-law for converting notified aid into existing aid were fulfilled in the present case. |
159 |
Still to be examined, in the fourth place, are the applicants’ arguments alleging that the Commission conducted itself as if the aid at issue were existing aid, which are based, in practice, on the content of the Council’s authorisation decisions, adopted on a proposal from the Commission, and on the long period in which the Commission refrained from initiating a formal investigation procedure. |
160 |
In that regard, it is appropriate to recall that the question whether aid is new or existing, in accordance with the case-law cited in paragraph 154 above, and whether or not its introduction therefore requires the preliminary examination procedure under Article 93(3) of the EC Treaty to be put in motion cannot depend on a subjective assessment by the Commission (see, to that effect, judgment in Piaggio, cited in paragraph 154 above, EU:C:1999:313, paragraphs 47 and 48). Moreover, the mere fact that for a relatively long period the Commission did not open an investigation into a State measure cannot in itself make that measure existing aid in objective terms, if it does constitute aid (judgment of 30 April 2002 in Government of Gibraltar v Commission, T‑195/01 and T‑207/01, ECR, EU:T:2002:111, paragraph 129). |
161 |
It is clear from the case-law cited in paragraph 160 above that the applicants’ arguments alleging, in essence, that the Commission’s conduct reflected its belief that the aid at issue was existing aid have no basis and must be rejected. |
162 |
For all the foregoing reasons, it must be held that the Commission did not err in refusing to take the view that the aid at issue was converted, following notification, into existing aid. Neither did it, therefore, in ordering the recovery of that aid with retroactive effect from 3 February 2002, infringe the procedure relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999, since that procedure was not applicable to that aid. |
163 |
Accordingly, the first part of the first plea raised in support of the action in Case T‑50/06 RENV II and the second part of the first plea raised in support of the action in Case T‑69/06 RENV II must be rejected as unfounded. |
The second part of the first plea raised in support of the action in Case T‑50/06 RENV II and the third part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging infringement of the provisions of Article 88 EC read in conjunction with Articles 1(b)(iv) and 15(3) of Regulation No 659/1999
164 |
The applicants claim that the Commission infringed the provisions of Article 88 EC read in conjunction with Articles 1(b)(iv) and 15(3) of Regulation No 659/1999, in recital 68 of Alumina Decision I, in that it failed to take into account, for the purposes of classifying the aid at issue as new aid, within the meaning of Article 88(3) EC, from 17 July 1990, the fact that AAL had been receiving that aid since September 1983, that the 10-year limitation period applicable to the Commission’s powers of recovery of aid, provided for in Article 15(3) of Regulation No 659/1999, had therefore expired at the time the Commission began to act, on 17 July 2000, and that, from that date, the aid at issue had to be regarded as existing aid. |
165 |
Moreover, in Case T‑50/06 RENV II, Ireland complains, in essence, that the Commission infringed the procedural rules applicable to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999, in that, in the contested decision, it ordered recovery of the aid at issue with retroactive effect, without having regard to the fact that, as part of its constant review of existing aid schemes, it was empowered only to require the elimination or modification of such aid, within a period which it determined. |
166 |
In that regard, Ireland, first, relies on the fact that, as is confirmed by academic lawyers, limitation occurs at the end of the limitation period where, as in the present case, the characteristics of the aid have not changed during that period. Second, it cites the obligation to classify all State aid either as ‘existing’ aid or as ‘new’ aid, within the meaning of Article 15 of Regulation No 659/1999, since the concept of ‘partially existing and partially new’ aid is not provided for in Regulation No 659/1999. Third, it refers to the case-law, from which it is apparent that the limitation period is intended inter alia to protect the rights or interests of certain interested parties, including the Member State concerned and the beneficiary of the aid. Fourth, it relies on the lack of suspensory effect of the letter of 17 July 2000 on the limitation period, that letter being written after the expiry of the limitation period provided for in Article 15(3) of Regulation No 659/1999. Fifth, it refers to the definition of ‘existing aid’ in Regulation No 659/1999, which does not concern only the financial benefits actually received on a given date but also aid schemes. Moreover, Ireland complains, in essence, that the Commission infringed the procedural rules applicable to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999, in that, in the contested decision, it ordered recovery of the aid at issue with retroactive effect, without having regard to the fact that, as part of its constant review of existing aid, it was only empowered to require the elimination or modification of such aid within a period which it determined. |
167 |
First, AAL claims that the principle of legal certainty is infringed by the interpretation of Article 15 of Regulation No 659/1999 given by the Commission in the contested decision, according to which only that part of the aid granted on the basis of the exemption at issue in respect of which the limitation period has expired is deemed to be existing aid. Second, it argues that the Commission was not entitled to claim, for the first time in the statement of defence, that the exemption at issue was an aid scheme rather than individual aid that had been granted to it every time that, pursuant to the exemption at issue, it had been exempted from excise duty as part of a customs procedure. Third, it relies on the term ‘deemed’ contained in Article 15(3) of Regulation No 659/1999, from which it may be inferred, in the present case, that individual aid is deemed to become existing aid on expiry of a period of 10 years calculated from the first grant of the aid, in 1983. |
168 |
The Commission contends that the present parts of the first pleas should be rejected as unfounded. |
169 |
To the extent that the applicants allege infringement of Article 1(b)(iv) of Regulation No 659/1999, it must be noted that, in accordance with the case-law cited in paragraph 140 above, at the time when the Commission adjudicated on the aid at issue, that provision was in force, so it is applicable in the present case. |
170 |
In the wording of that provision, ‘aid which is deemed to be existing aid pursuant to Article 15’ must be classified as ‘existing aid’. |
171 |
Article 15 of Regulation No 659/1999 provides as follows: ‘1. The powers of the Commission to recover aid shall be subject to a limitation period of 10 years. 2. The limitation period shall begin on the day on which the unlawful aid is awarded to the beneficiary either as individual aid or as aid under an aid scheme. Any action taken by the Commission or by a Member State, acting at the request of the Commission, with regard to the unlawful aid shall interrupt the limitation period. Each interruption shall start time running afresh. The limitation period shall be suspended for as long as the decision of the Commission is the subject of proceedings pending before the Court of Justice of the European Communities. 3. Any aid with regard to which the limitation period has expired, shall be deemed to be existing aid.’ |
172 |
As is apparent from recital 14 of Regulation No 659/1999, the limitation period laid down in Article 15 of the same regulation is intended, in particular, to protect some of the interested parties, including the Member State concerned and the beneficiary of the aid (judgment of 6 October 2005 in Scott v Commission, C‑276/03 P, ECR, EU:C:2005:590, paragraph 30). |
173 |
As a preliminary point, it should be pointed out that Article 15 of Regulation No 659/1999 is a procedural rule intended, in accordance with the case-law cited in paragraph 141 above, to apply at the time of that provision’s entry into force, namely, in the present case, 16 April 1999. However, in so far as, unlike the last subparagraph of Article 11(2) of Regulation No 659/1999, Article 15 of the regulation contains no transitional provision regarding its application in time, it must be held to apply to all formal investigation procedures in course as of 16 April 1999 or initiated from that date (see, to that effect, judgment of 28 November 2008 in Hotel Cipriani and Others v Commission, T‑254/00, T‑270/00 and T‑277/00, ECR, EU:T:2008:537, paragraph 357). It follows that, even though the aid was granted before the entry into force of Article 15 of Regulation No 659/1999, it nevertheless has the effect of starting the limitation period of 10 years laid down in that article, where the decision to recover that aid is taken, as in the present case, after the entry into force of that article. |
174 |
In the present case, the applicants claim, in essence, that the Commission erred in taking the view that the aid at issue was new aid even though, in recital 68 of Alumina Decision I, it had concluded that the aid granted under the exemption at issue was aid deemed to be existing aid pursuant to Article 15 of Regulation No 659/1999, within the meaning of Article 1(b)(iv) of the same regulation, for the period prior to 17 July 1990, and even though the benefit of the limitation laid down in Article 15 of Regulation No 659/1999 also had to apply to the aid at issue. |
175 |
In recital 68 of Alumina Decision I, the Commission observed the following: ‘… the aid can only partially be deemed to be existing aid pursuant to Article 15 of Regulation (EC) No 659/1999. That Article makes the powers of the Commission to recover aid subject to a limitation period of 10 years, beginning on the day on which the unlawful aid is awarded. … In the case of Ireland, this period has been interrupted by the Commission’s letter of 17 July 2000. This means that only the Irish exemption in as far as it concerns the period before 17 July 1990, can be considered to be existing aid.’ |
176 |
It is apparent from recital 68 of Alumina Decision I that, in that decision, the Commission held the view that, for the period prior to 17 July 1990, the exemption at issue was deemed to be existing aid pursuant to Article 15 of Regulation No 659/1999, within the meaning of Article 1(b)(iv) of the same regulation. |
177 |
In its pleadings, the Commission argues that that outcome is justified by the fact that the exemption at issue is an ‘aid scheme’, within the meaning of Article 1(d) of Regulation No 659/1999, and that, pursuant to Article 15 of the same regulation, the limitation period began only on the day on which unlawful aid was actually granted to AAL under that scheme. |
178 |
Article 1(d) of Regulation No 659/1999 provides that ‘aid scheme’ means ‘any act on the basis of which, without further implementing measures being required, individual aid awards may be made to undertakings defined within the act in a general and abstract manner and any act on the basis of which aid which is not linked to a specific project may be awarded to one or several undertakings for an indefinite period of time and/or for an indefinite amount’. That provision sets out and codifies earlier case-law (see, to that effect, judgment of 5 June 1996 in Kahn Scheepvaart v Commission, T‑398/94, ECR, EU:T:1996:73, paragraphs 41 and 49). |
179 |
In the present case, it is undisputed that the exemption at issue was introduced, in Irish law, by the 1983 order, which took effect on 13 May 1983. That order grants a rebate on the excise duty applicable to mineral oils used as fuel for the production of alumina, whose amount is equal to that of the excise duty, which amounts, in practice, to introducing an exemption from that duty. Even taking into account the detailed conditions of a geographical and temporal nature set by the Council’s authorisation decisions for the exemption at issue (see, to that effect, judgment in Commission v Ireland and Others, cited in paragraph 27 above, EU:C:2013:812, paragraph 50), that measure corresponds to an ‘aid scheme’, within the meaning of Article 1(d) of Regulation No 659/1999, contrary to what AAL claims, in so far as the beneficiaries of the aid are defined, in a general and abstract manner, as being, in essence, alumina producers and the amount of the aid granted to them remains undetermined. |
180 |
To the extent that AAL complains that the Commission took the view, for the first time in the statement of defence, that the exemption at issue was an aid scheme rather than individual aid, suffice it to state that the complaint is based on the premiss that the contested decision rules out classification of the exemption at issue as an ‘aid scheme’, within the meaning of Article 1(d) of Regulation No 659/1999. However, AAL has not put forward any evidence in support of such a premiss. Accordingly, this complaint must be rejected. |
181 |
As the Commission correctly notes, it is apparent from Article 15(2) of Regulation No 659/1999 that, under an aid scheme, the limitation period begins on the day on which the unlawful aid is granted to the beneficiary, which corresponds, in the present case, to each import by AAL or delivery to it, from a refinery or storage warehouse, of mineral oils intended to be used as fuel for the production of alumina in its plant in the Shannon region. It is at the time of each of those acts that AAL benefited, in practice, from the exemption at issue and was individually granted aid pursuant to it (see judgment in Hotel Cipriani and Others v Commission, cited in paragraph 173 above, EU:T:2008:537, paragraph 364 and the case-law cited). Therefore, contrary to what the applicants claim, the limitation period laid down in Article 15 of Regulation No 659/1999 began in respect of each aid thus granted under the aid scheme corresponding to the exemption at issue, from the day on which the aid in question was granted (see, to that effect, judgment of 8 December 2011 in France Telecom v Commission, C‑81/10 P, ECR, EU:C:2011:811, paragraph 84). |
182 |
That interpretation of Article 15 of Regulation No 659/1999, concerning the date from which the limitation period runs (dies a quo) in relation to aid granted under an aid scheme, is not called into question by the judgment in Scott v Commission, cited in paragraph 172 above (EU:C:2005:590), relied on by Ireland in Case T‑50/06 RENV II, which concerned only whether, as regards individual aid, the interruption of the limitation period laid down in that same article was subject to a requirement to notify the act interrupting the limitation period to the beneficiary of the aid. |
183 |
Moreover, the limitation period laid down in Article 15 of Regulation No 659/1999 was interrupted, in relation to the exemption at issue, by the letter of the Commission of 17 July 2000. |
184 |
The Commission was therefore right to state, in that context, in recital 68 of Alumina Decision I, that the limitation period laid down in Article 15 of Regulation No 659/1999 had expired only in relation to the exemption granted before 17 July 1990 and that, accordingly, the aid at issue, granted after that date, could not be deemed to be existing aid, within the meaning of Article 1(b)(iv) of Regulation No 659/1999, read in combination with Article 15(3) of that regulation. Therefore, it did not, in ordering recovery of that aid with retroactive effect from 3 February 2002, infringe the procedure relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999, either, since the latter procedure was not applicable to that aid. |
185 |
Accordingly, the second part of the first plea raised in support of the action in Case T‑50/06 RENV II and the third part of the first plea raised in support of the action in Case T‑69/06 RENV II must be rejected as unfounded. |
The third part of the first plea raised in support of the action in Case T‑50/06 RENV II and the first part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging, in essence, infringement of Article 88 EC and the rule codified in Article 1(b)(i) of Regulation No 659/1999
186 |
The applicants claim, in essence, that the Commission infringed Article 88 EC and the rule codified in Article 1(b)(i) of Regulation No 659/1999, in the contested decision, in that it failed to take into account, for the purposes of classifying the aid at issue as new aid, within the meaning of Article 88(3) EC, the fact that Ireland, before its accession to the European Economic Community (EEC), on 1 January 1973, had given a binding commitment to Alcan regarding the application of the exemption at issue in the context of the operation of the alumina production plant it established in the Shannon region, then sold to AAL, with the result that the aid at issue had been granted before the entry into force, in its territory, of the EEC Treaty. |
187 |
In that regard, first, Ireland bases its argument on the commitment formalised by the letters exchanged with Alcan, from 1970, under which no duty was to be payable on raw materials used for alumina production in the plant that Alcan planned to build in the Shannon region. Second, it relies on the legally binding character of that commitment, in Irish law, as confirmed by the legal advisers of the Irish Government and by the Attorney General, in 1981. Third, it cites the Commission’s failure to carry out an in-depth investigation of the nature of that commitment as a matter of Irish law. Fourth, it refers to the content of the letter of 6 May 1983, in which it never accepted that the aid at issue did not constitute existing aid, but merely responded to the Commission’s offer to treat the letter of January 1983 as notification of the implementation of the exemption at issue. Fifth, it cites the irrelevance of the fact that the 1983 order was adopted after the entry into force, in its territory, of the EEC Treaty, since that order was only the formal implementation of a legally binding commitment given to Alcan before the aforementioned entry into force and that, at the time when the commitment had been made, the law permitting the Minister to adopt the 1983 order was already in force. |
188 |
First, AAL relies on the legally binding commitment given by Ireland to Alcan, in April 1970, under which no duty was to be payable on raw materials used for alumina production in the plant planned for the Shannon region, a legal commitment whose existence was confirmed to Alcan by the letter of Ireland to the Commission of 28 January 1983. Second, it refers to the view continually expressed by Ireland, including in the letter of 6 May 1983, according to which the exemption at issue was non-notifiable aid, since it was already in place at the time of Ireland’s accession to the EEC, with only its implementation being notified to the Commission in 1983. Third, it cites the irrelevance of the tax rules specifically applicable, since the aid consisted of a general exemption from domestic tax on the raw materials used for processing. Fourth, it bases an argument on the nature of the Irish legislative process, in which the Minister legislates by way of statutory instrument and the parliament subsequently confirms the measure by way of legislation. |
189 |
The Commission contends that the third part of the first plea raised in support of the action in Case T‑50/06 RENV II should be dismissed as inadmissible by virtue of the principle nemo potest venire contra factum proprium, since Ireland had taken a contrary position in the administrative procedure. In any event, the third part of the first plea raised in support of the action in Case T‑50/06 RENV II is unfounded. Moreover, the Commission contends that the first part of the first plea raised in support of the action in Case T‑69/06 RENV II should be rejected as unfounded. |
190 |
As a preliminary point and in so far as the applicants formally allege infringement of Article 1(b)(i) of Regulation No 659/1999, it must be noted that, in accordance with the case-law cited in paragraph 140 above, at the time when the Commission adjudicated on the aid at issue, Article 1(b)(i) was in force, so it is applicable in the present case. |
191 |
According to that provision, ‘all aid which existed prior to the entry into force of the Treaty in the respective Member States, that is to say, aid schemes and individual aid which were put into effect before, and are still applicable after, the entry into force of the Treaty’ may be categorised as ‘existing aid’. |
192 |
In the first place, regarding the plea of inadmissibility raised by the Commission against the third part of the first plea raised in support of the action in Case T‑50/06 RENV II, it is necessary to recall that, by virtue of the principle nemo potest venire contra factum proprium, a person may not dispute what he has previously accepted (see, to that effect and by analogy, order of 13 February 2014 in Marszałkowski v OHIM, C‑177/13 P, EU:C:2014:183, paragraphs 73 and 74 and the case-law cited). |
193 |
In the present case, and supposing that the Commission were entitled to rely on the principle nemo potest venire contra factum proprium in respect of claims initially put forward in the administrative procedure, it is necessary to verify whether Ireland acknowledged, in the course of that procedure, that it did not grant the aid at issue prior to its accession to the EEC on 1 January 1973. |
194 |
In the letter of 6 May 1983, Ireland stated that, on the basis of the arguments reproduced in the letter of the Commission of 22 March 1983, regarding the commitments it gave to Alcan, it could acknowledge that the implementation of those commitments had to be notified, pursuant to Article 93(3) of the EC Treaty, and requested, in consequence, that its letter of 28 January 1983 be treated as such a notification. In the last sentence of recital 65 of Alumina Decision I, the Commission thus noted that, in its letter of 6 May 1983, Ireland had accepted its arguments that the aid at issue had to be notified, which amounted to considering that it was not existing aid, but new aid, within the meaning of Article 1(c) of Regulation No 659/1999, only new aid being subject to the obligation of notification laid down by Article 93(3) of the EC Treaty (judgment in Piaggio, cited in paragraph 154 above, EU:C:1999:313, paragraph 48). |
195 |
However, as is apparent from recital 53 of the contested decision, during the formal investigation procedure, Ireland had recalled the history of the exemption at issue and insisted that it had to be considered existing aid. |
196 |
It is true that, in AAL’s letter to the Commission of 1 March 2002, the only point in dispute was whether the exemption at issue, which was originally new aid, had not been converted, following notification to the Commission, into existing aid, in accordance with the Lorenz case-law that was then codified in Article 1(b)(iii) of Regulation No 659/1999 (see paragraphs 135 and 136 above). In that letter, AAL observed that ‘the exemption [had been] notified as State aid by the Irish authorities in May 1983 and [had] become an existing aid for the purposes of the State aid provisions’. |
197 |
However, in paragraph 3.1 of the letter of 8 January 2002, referred to in recital 13 of the contested decision and produced in copy in reply to the written questions of the Court, Ireland maintained that it regarded ‘the aid in question as having been approved by the Irish authorities in 1970, prior to Ireland’s entry to the EEC, and in place since 1982’. In addition, in annex to the letter of 26 April 2002, referred to in recital 13 of the contested decision and produced in copy in reply to the Court’s written questions, Ireland provided, at the request of the Commission, a number of documents intended to show that the aid at issue had been granted by Ireland before its accession to the EEC. |
198 |
It is thus apparent from examining the documents in the file that, after notifying the exemption to the Commission, Ireland continued to maintain, during the administrative procedure, that it granted the aid at issue before its accession to the EEC, which led the Commission to examine that issue. |
199 |
In such a context, even though Ireland responded positively to the Commission’s offer to treat the letter of January 1983 as a notification of the implementation of the exemption at issue, it cannot be held that, in the context of the third part of the first plea raised in support of the action in Case T‑50/06 RENV II, Ireland disputed factual and legal elements which it had previously accepted during the administrative procedure. |
200 |
Accordingly, the Commission’s claim that Ireland acknowledged, in the course of the administrative procedure, that it did not grant the aid at issue prior to its accession to the EEC, on 1 January 1973, has no basis in fact and, accordingly, the Court rejects the plea of inadmissibility raised by the Commission on the basis of the principle nemo potest venire contra factum proprium. |
201 |
In the second place, regarding the merits of the third part of the first plea raised in support of the action in Case T‑50/06 RENV II and of the first part of the first plea raised in support of the action in Case T‑69/06 RENV II, it is important to bear in mind that, to be able to be classified as ‘existing aid’ within the meaning of Article 1(b)(i) of Regulation No 659/1999, an aid scheme must not only, prior to the accession of the Member State concerned to the EEC, have been granted, inasmuch as the competent national authority has undertaken, by a legally binding act, to grant aid under that scheme (see, to that effect, judgment of 14 January 2004 in Fleuren Compost v Commission, T‑109/01, ECR, EU:T:2004:4, paragraphs 73 and 74), but also have been put into effect, in that payment of some of the aid granted under that scheme has actually taken place. |
202 |
In the present case, the parties are in agreement that the exemption at issue, which, according to the applicants, results from a commitment given by Ireland to Alcan before its accession to the EEC on 1 January 1973, was, in any event, put into effect only from 1983, namely a long time after that accession. Questioned on that point at the hearing, the applicants were not able to prove that the condition relating to the implementation of the aid scheme in question before the accession of the Member State concerned to the EEC, necessary for that scheme to be classified as ‘existing aid’ within the meaning of Article 1(b)(i) of Regulation No 659/1999, was satisfied in the present case. |
203 |
Therefore, without it even being necessary to verify whether, as the applicants claim, before its accession to the EEC, Ireland had given a legally binding commitment to Alcan regarding the application of the exemption at issue in the context of the operation of the alumina production plant Alcan established in the Shannon region, then sold to AAL, it may be held that one of the requisite conditions in order for the exemption at issue to be classified as ‘existing aid’ within the meaning of Article 1(b)(i) of Regulation No 659/1999 is not satisfied in this case. Accordingly, the third part of the first plea raised in support of the action in Case T‑50/06 RENV II and the first part of the first plea raised in support of the action in Case T‑69/06 RENV II must be rejected. |
204 |
Since all of the parts articulated in the context of the first pleas raised in support of the present actions have been rejected, those pleas must be rejected in their entirety. |
The third plea, alleging infringement of the principle of the protection of legitimate expectations, raised in support of the action in Case T‑50/06 RENV II, and the fourth plea, alleging infringement of the principles of protection of legitimate expectations and of legal certainty, raised in support of the action in Case T‑69/06 RENV II
205 |
In the context of the third plea raised in support of the action in Case T‑50/06 RENV II, Ireland claims that the Commission infringed the principle of protection of legitimate expectations, in the contested decision, in deciding that AAL’s legitimate expectations that the aid allegedly granted to it was lawful had ended on 2 February 2002, that is, at the date of publication of the decision to initiate the formal investigation procedure. In that regard, first of all, it submits that AAL could have had a legitimate expectation that the aid at issue would be classified as existing aid. First, it bases its argument on the contradictory nature of Alumina Decision I, which concludes, in recitals 68 and 104, that the aid at issue is partially existing aid, as regards the aid granted before 17 July 1990, while stating that it constitutes new aid, to a large extent incompatible with the common market, within the meaning of Article 87(3) EC. Second, it alleges the Commission’s error consisting, first, of not classifying the aid at issue as existing aid, second, of not applying, in the present case, the procedure relating to existing aid schemes, as codified in Regulation No 659/1999, and, third, of delaying in deciding that the aid at issue was incompatible with the common market, within the meaning of Article 87(3) EC, the contested decision having been adopted more than 43 months after the Commission’s receipt, in April 2002, of its reply to the last request for additional information sent by that institution. Next, Ireland claims that the Commission could not arrogate to itself the right or the power to determine, in the contested decision, the time at which it gave rise to and, subsequently, eliminated AAL’s legitimate expectation that the aid allegedly granted to it was lawful. Finally, Ireland considers that AAL and itself were entitled to rely on Decision 2001/224, which authorised it to continue to apply the exemption at issue until 31 December 2006. |
206 |
In its reply, Ireland argues that, in the light of Article 7(6) of Regulation No 659/1999, which states that the Commission must endeavour to adopt a decision within a period of 18 months, of the principle of fairness and of the fact that the Commission arrogated to itself the power to decide whether AAL’s legitimate expectations had been protected, recovery of the aid should be limited to the 18-month period preceding the adoption of Alumina Decision I. It should also be taken into account that the Commission had given out contradictory signals to AAL and that AAL was unable to mitigate its losses in the event of repayment of the aid allegedly granted from 3 February 2002. Last, it should be taken into account that the Commission did not adopt a suspension injunction for the aid at issue, pursuant to Article 11(1) of Regulation No 659/1999, and therefore failed to mitigate the effects of that aid on the common market. |
207 |
In the context of the fourth plea raised in support of the action in Case T‑69/06 RENV II, AAL claims that, in the contested decision, the Commission infringed the principles of protection of legitimate expectations and of legal certainty. This plea is divided into two parts, the second of which is merely the continuation, by way of additional arguments, of the first. |
208 |
In the context of the first part of the fourth plea, AAL argues that, in the contested decision, the Commission infringed the principles of protection of legitimate expectations and of legal certainty, particularly when it ordered the recovery of the aid at issue, on the grounds, set out in recitals 98 and 99 of Alumina Decision I, that, on the one hand, publication of the decision to initiate the formal investigation procedure had put an end to its legitimate expectation that the aid at issue was lawful and that, on the other, the principle of legal certainty had ceased to apply when it had clarified a situation which was, previously, equivocal. It is of the view that there are, in the present case, exceptional circumstances which permit it, in accordance with the case-law, to rely on a legitimate expectation that the aid at issue had been lawfully granted to it under Decision 2001/224 and would not be recovered and that the exemption at issue could be lawfully applied until 31 December 2006, in accordance with this latter decision, even after the publication of the decision to initiate the formal investigation procedure. That publication did not put an end to the equivocal situation regarding the lawfulness of the exemption at issue. In that regard, first, AAL relies on the notification of the exemption at issue to the Commission in 1983 and the Commission’s inaction or silence for 17 years. Second, it refers to the Council’s authorisation decisions, adopted unanimously on a proposal from the Commission, which led it to believe that the aid at issue was lawful in so far as those decisions stated or were based on the premiss that the exemption at issue did not give rise to a distortion of competition and authorised Ireland to apply the exemption at issue, most recently until 2006. Third, it relies on the proposal for a Council authorisation decision of November 1999, which revealed the Commission’s intention of phasing out the authorisation to apply the exemption at issue, but not of recovering the aid granted under that exemption, during the entire period in which it had been authorised by the Council. Fourth, it pleads its belief that Ireland was complying with its obligations under the State aid rules. Fifth, it refers to the publication of the decision to initiate the formal investigation procedure, which merely reflected the Commission’s doubts as to whether aid at issue was compatible with the common market and was not such as to affect its legitimate expectation, in the light of Decision 2001/224, that, in any event, the aid granted up to 2006 would not be recovered. Sixth, it cites its expectation that the formal investigation procedure would not culminate in a negative State aid decision. Seventh, it relies on the Commission’s delay in adopting Alumina Decision I, which, contrary to the principles of sound administration and legal certainty, was adopted more than 43 months after the Commission’s receipt, in April 2002, of Ireland’s reply to the last request for additional information sent by that institution, which reinforced its legitimate expectation that the aid at issue would not be recovered. Eighth, it refers to the Commission’s conduct at the time of the adoption by the Council of Directive 2003/96, in particular its press release of 27 October 2003 welcoming that adoption, which fuelled its legitimate expectation that the aid at issue was lawful under the State aid rules. Ninth, it cites the absence of an order from the Commission requiring Ireland to suspend payment of the unlawful aid allegedly granted until it had given a ruling on the compatibility of the aid with the common market, under Article 11(1) of Regulation No 659/1999. Tenth, it bases an argument on the significant long-term investments it made in good faith, in the autumn of 2003, corresponding to the construction of a combined heat and power plant, costing approximately EUR 100 million, and to an investment of EUR 70 million to increase its production capacity, based on its legitimate expectation that the exemption at issue would be applied until 31 December 2006 or, at the very least, that the aid granted up to that date would not be recovered. |
209 |
The Commission contends that the present pleas should be rejected as unfounded. |
210 |
As a preliminary point, it should be recalled that, to the extent that, in the context of the first part of the fourth plea raised in support of the action in Case T‑69/06 RENV II, AAL articulates a complaint alleging infringement of the principle of legal certainty, that part is indissociable from the complaint, also alleging infringement of the principle of legal certainty, articulated in the context of the second plea raised in support of the same action. |
211 |
For the reasons set out in paragraphs 59 and 61 to 74 above, that complaint must be rejected as unfounded. |
212 |
For the remainder, the third plea raised in support of the action in Case T‑50/06 RENV II and the fourth plea raised in support of the action in Case T‑69/06 RENV II essentially ask whether, in requiring, in the contested decision, the aid at issue to be recovered, the Commission acted contrary to the principle of protection of legitimate expectations. |
213 |
In that regard, it is appropriate, first of all, to bear in mind that the principle of protection of legitimate expectations, a fundamental principle of EU law (judgment of 14 October 1999 in Atlanta v European Community, C‑104/97 P, ECR, EU:C:1999:498, paragraph 52), allows any trader in regard to whom an institution has given rise to justified expectations to rely on those expectations (judgments of 11 March 1987 in Van den Bergh en Jurgens and Van Dijk Food Products (Lopik) v EEC, 265/85, ECR, EU:C:1987:121, paragraph 44; 24 March 2011ISD Polska and Others v Commission, C‑369/09 P, ECR, EU:C:2011:175, paragraph 123; and 27 September 2012Producteurs de légumes de France v Commission, T‑328/09, EU:T:2012:498, paragraph 18). However, if a prudent and alert trader could have foreseen the adoption by the institutions of an act likely to affect his interests, he cannot plead that principle if the act is adopted (judgments of 1 February 1978 in Lührs, 78/77, ECR, EU:C:1978:20, paragraph 6, and 25 March 2009Alcoa Trasformazioni v Commission, T‑332/06, EU:T:2009:79, paragraph 102). The right to rely on that principle assumes that three conditions are satisfied. First, precise, unconditional and consistent assurances originating from authorised and reliable sources must have been given by the authorities to the person concerned. Second, those assurances must be such as to give rise to an expectation that is legitimate on the part of the person to whom they are addressed. Third, the assurances given must be consistent with the applicable rules (see judgment in Producteurs de légumes de France v Commission, EU:T:2012:498, paragraph 19 and the case-law cited). |
214 |
It is appropriate, next, as regards more specifically the applicability of the principle of protection of legitimate expectations in the area of State aid, to recall that a Member State whose authorities have granted aid contrary to the procedural rules laid down in Article 88 EC may rely on the legitimate expectations of the recipient undertaking to challenge before the EU judicature the validity of a Commission decision instructing it to recover the aid, but not to justify a failure to comply with the obligation to take the steps necessary to implement it (see judgment of 14 January 1997 in Spain v Commission, C‑169/95, ECR, EU:C:1997:10, paragraphs 48 and 49 and the case-law cited). It is apparent, moreover, from the case-law that, in view of the fundamental role played by the notification obligation to render effective the review of State aid by the Commission, which is mandatory, the recipients of aid may not, in principle, entertain a legitimate expectation that the aid is lawful unless it has been granted in compliance with the procedure provided for in Article 88 EC and a diligent business operator must normally be in a position to confirm that that procedure has been followed. In particular, where aid is implemented without prior notification to the Commission or, as in the present case, without giving prior notice of the implementation as required by the Lorenz case-law (see paragraphs 154 and 156 to 158 above), so that it is unlawful under Article 88(3) EC, the recipient of the aid cannot have at that time a legitimate expectation that its grant is lawful (see, to that effect, judgment in Producteurs de légumes de France v Commission, cited in paragraph 213 above, EU:T:2012:498, paragraphs 20 and 21 and the case-law cited), except where there are exceptional circumstances (judgment of 20 September 1990 in Commission v Germany, C‑5/89, ECR,EU:C:1990:320, paragraph 16; see, also, judgments of 29 April 2004 in Italy v Commission, C‑298/00 P, ECR, EU:C:2004:240, paragraph 86 and the case-law cited, and 30 November 2009France v Commission, T‑427/04 and T‑17/05, ECR, EU:T:2009:474, paragraph 263 and the case-law cited). |
215 |
It should also be borne in mind that it is a general principle of EU law that the conduct of an administrative procedure should be of reasonable duration (judgment of 27 November 2003 in Regione Siciliana v Commission, T‑190/00, ECR, EU:T:2003:316, paragraph 136). Further, the fundamental requirement of legal certainty, which precludes the Commission from being able to postpone the exercise of its powers indefinitely, means that the Court has to assess whether the progress of the administrative procedure indicates excessively belated action on the part of that institution (judgments of 24 September 2002 in Falck and Acciaierie di Bolzano v Commission, C‑74/00 P and C‑75/00 P, ECR, EU:C:2002:524, paragraphs 140 and 141, and Fleuren Compost v Commission, cited in paragraph 201 above, EU:T:2004:4, paragraphs 145 to 147). |
216 |
A delay by the Commission in deciding that aid is unlawful and that it must be abolished and recovered by a Member State may, in certain circumstances, establish a legitimate expectation on the recipients’ part so as to prevent the Commission from requiring that Member State to order the refund of that aid (judgment of 24 November 1987 in RSV v Commission, 223/85, ECR, EU:C:1987:502, paragraph 17). |
217 |
The sole fact that Regulation No 659/1999, apart from a limitation period of 10 years (from the grant of the aid) at the end of which recovery of the aid may no longer be ordered, does not prescribe any time limit, even indicative, for the examination by the Commission of unlawful aid, Article 13(2) of that regulation providing that the Commission is not to be bound by the time limit set out in Article 7(6) of the same regulation, does not prevent the EU judicature from verifying whether that institution failed to take a reasonable amount of time or acted too slowly (see, to that effect and by analogy, regarding indicative periods, judgments of 15 June 2005 in Regione autonoma della Sardegna v Commission, T‑171/02, ECR, EU:T:2005:219, paragraph 57; and 9 September 2009Diputación Foral de Álava and Others, T‑230/01 to T‑232/01 and T‑267/01 to T‑269/01, EU:T:2009:316, paragraphs 338 and 339; and Diputación Foral de Álava and Others v Commission, T‑30/01 to T‑32/01 and T‑86/02 to T‑88/02, ECR, EU:T:2009:314, paragraphs 259 and 260). |
218 |
Last, it should be recalled that, according to the case-law, the principle of legal certainty requires that, where the Commission has created, in disregard of its duty of care, an equivocal situation, owing to the introduction of elements of uncertainty and a lack of clarity in the applicable legislation, combined with a prolonged lack of response on its part despite its awareness of the aid concerned, the Commission is under a duty to clarify such a situation before it can take any action to order the recovery of the aid already paid (see, to that effect, judgment of 9 July 1970 in Commission v France, 26/69, ECR, EU:C:1970:67, paragraphs 28 to 32). |
219 |
The arguments of the parties should be assessed in the light of the rules set out in paragraphs 210 and 218 above. |
220 |
In the present case, first of all, it should be pointed out that, even accepting that the exemption at issue was notified to the Commission by the letters of 28 January and 6 May 1983, it was unlawfully put into effect, in so far as one of the procedural rules deriving from the Lorenz case-law, namely the one which requires the Member State to give the Commission prior notice of the implementation of the planned aid, was not complied with (see paragraphs 154 and 156 to 158 above). The aid at issue was thus implemented unlawfully, in infringement of Article 88(3) EC. |
221 |
Next, contrary to what the applicants argue, the publication in the Official Journal of the decision to initiate the formal investigation procedure was capable of putting an end to the legitimate expectation which AAL could have had as to the lawfulness of the exemption at issue, taking into account the equivocal situation previously created by the wording of the Council’s authorisation decisions, adopted on a proposal from the Commission, including that of Decision 2001/224, which was in force during the period concerned by the contested decision. |
222 |
In paragraphs 52 and 53 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), which is binding on the General Court pursuant to the second subparagraph of Article 61 of the Statute of the Court of Justice, the Court of Justice held that the fact that the Council’s authorisation decisions were adopted on a proposal from the Commission and the latter never used the powers available to it, under Article 8(5) of Directive 92/81 or Articles 230 EC and 241 EC, in order to secure the abolition or alteration of those authorisation decisions had to be taken into consideration in relation to the obligation to recover the incompatible aid, in the light of the principles of protection of legitimate expectations and legal certainty, as the Commission had done, in Alumina Decision I, when it declined to order the recovery of aid granted until 2 February 2002, the date of publication in the Official Journal of the decisions to initiate the formal investigation procedure. That ground was decisive to the finding of the Court of Justice, in paragraph 54 of the judgment in Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), that the grounds set out in paragraphs 39 to 44 of that same judgment could not provide a legal basis for the General Court’s conclusion that Alumina Decision I called into question the validity of the Council’s authorisation decisions and thereby was in breach of the principles of legal certainty and the presumption of legality attaching to the measures of the institutions and the finding, which was based on the same grounds, that, in Case T‑62/06 RENV, the Commission had infringed the principle of sound administration. |
223 |
In view of the requirements resulting from the principles of protection of legitimate expectations and of legal certainty, the equivocal situation created by the wording of the Council’s authorisation decisions, adopted on a proposal from the Commission, precluded only the recovery of the aid granted on the basis of the exemption at issue until the date of publication in the Official Journal of the decision to initiate the formal investigation procedure. However, as of that publication, AAL must have known that, if the aid at issue constituted State aid, it had to be authorised by the Commission, in accordance with Article 88 EC. |
224 |
It follows that the publication of the decision to initiate the formal investigation procedure effectively put an end to the legitimate expectations that AAL might previously have that the exemption at issue was lawful, in view of the Council’s authorisation decisions, adopted earlier upon a proposal from the Commission. |
225 |
The Commission therefore rightly, in recital 98 of Alumina Decision I, took account of the fact that the circumstances of this case were exceptional in so far as it had created and maintained some ambiguity by submitting proposals to the Council, and that, to the extent that it could not establish whether and, if so, when, the individual beneficiaries had actually been informed by the Member States of its decision to open the formal investigation procedure, it could not be ruled out that beneficiaries had been entitled to rely on legitimate expectations until 2 February 2002, when its decisions to initiate the formal investigation procedure with respect to the exemptions from excise duty had been published in the Official Journal, it being noted that, at the very latest, that publication had eliminated any uncertainty, linked to the wording of the Council’s authorisation decisions, as to the fact that the measures in question had to be approved by the Commission in accordance with Article 88 EC, if they constituted State aid. |
226 |
The correctness of that conclusion is not called into question by the other arguments put forward by the applicants. |
227 |
As regards the argument put forward by Ireland based on the allegedly contradictory nature of Alumina Decision I, in that it concludes, in recitals 68 and 104, that the aid at issue is partially existing and partially new, it should be noted, for the reasons that have been set out in paragraphs 174 to 184 above, that, in those recitals, the Commission made a correct and non-inherently contradictory application of the rule established in Article 15 of Regulation No 659/1999, taking into account the nature as an ‘aid scheme’, within the meaning of Article 1(d) of the same regulation, of the exemption at issue. Accordingly, the present argument must be rejected as unfounded. |
228 |
With regard to the argument put forward by Ireland based on the error allegedly committed by the Commission in not classifying the aid at issue as existing aid and in not applying to the exemption at issue the procedure applicable to existing aid schemes, it is appropriate to hold, for the reasons set out in paragraphs 139 to 143, 155 to 162, 190 and 201 to 203 above, that the Commission committed no error in applying to the aid at issue, granted under the exemption at issue, Article 1(b)(iii) of Regulation No 659/1999, read in combination with the Lorenz case-law, and Article 1(b)(i) of the same regulation. Accordingly, the present argument must be rejected as unfounded. |
229 |
Regarding the argument put forward by AAL based on the apparent inaction of the Commission for 17 years, after the notification of the exemption at issue in 1983, it must be noted that, to the extent that, as is recalled in recital 5 of Decision 2001/224, the Council’s authorisation decisions did not override the requirement for Ireland to notify instances of potential State aid (see, to that effect, judgment in Commission v Ireland and Others, cited in paragraph 27 above, EU:C:2013:812, paragraph 51) and, after notification, the exemption at issue was implemented by Ireland without the giving of prior notice of the implementation required by the Lorenz case-law (see paragraph 220 above), the Commission cannot be said not to have, within a reasonable period following either one of those events, adopted a decision determining the compatibility of the exemption at issue with the common market, under the State aid rules. Accordingly, the present argument must be rejected as unfounded. |
230 |
In respect of the argument put forward by AAL based on the belief it claims to have had that Ireland was in compliance with its State aid obligations, it is necessary to recall that, in order to implement the exemption at issue lawfully, Ireland had to fulfil its obligation of notifying to the Commission not only that exemption, in accordance with Article 88(3) EC, but also the giving of prior notice of its implementation, required by the Lorenz case-law. In addition, according to settled case-law, due to the mandatory nature of the supervision of State aid by the Commission under Article 88 EC, undertakings to which aid has been granted may not, in principle, entertain a legitimate expectation that the aid is lawful unless it has been granted in compliance with the procedure laid down in that article. A diligent business operator must normally be in a position to confirm that that procedure has been followed (judgments in Commission v Germany, cited in paragraph 214 above, EU:C:1990:320, paragraph 14, and Spain v Commission, cited in paragraph 214 above, EU:C:1997:10, paragraph 51). In the present case, therefore, AAL was under a duty to verify, with the Commission, if appropriate, that Ireland had complied with all of its obligations, including the obligation to give it prior notice of the implementation of the exemption at issue. Accordingly, the present argument must be rejected as unfounded. |
231 |
In terms of the arguments put forward by the applicants based on the Commission’s delay in adopting Alumina Decision I, it must be stated that that is not an exceptional circumstance capable of having given rise, on the part of AAL, to a legitimate expectation that the aid at issue was lawful, for all the reasons set out in paragraphs 232 to 255 below. |
232 |
In the first place, it is appropriate to examine whether the period for the formal investigation procedure exceeded, in the present case, reasonable limits. |
233 |
In that regard, it must be noted that, in the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502), the Court of Justice found that the period of 26 months taken by the Commission to adopt its decision had exceeded reasonable limits. |
234 |
Moreover, it should be recalled that, pursuant to Article 7(6) of Regulation No 659/1999, the reference period for completing a formal investigation procedure in the context of notified State aid is 18 months. That period, even though not applicable to unlawful aid, in accordance with Article 13(2) of Regulation No 659/1999 (see paragraph 217 above), provides a useful point of reference for assessing the reasonableness of the duration of a formal investigation procedure relating, as in the present cases, to a measure unlawfully implemented (see paragraph 220 above). |
235 |
In the present case, it must be pointed out that, on 17 July 2000, the Commission requested the French Republic, Ireland and the Italian Republic to notify it of the exemptions from excise duty under the State aid provisions. It received the replies, which did not have the status of a notification, in September, October and December 2000. It then initiated the formal investigation procedure by decision of 30 October 2001, which it notified to the Member States concerned on 5 November 2001 and published in the Official Journal on 2 February 2002. It then received the comments of AAL (letters of 26 February and 1 March 2002), Eurallumina (letters of 28 February 2002), Alcan Inc. (letter of 1 March 2002) and the European Aluminium Association (letter of 26 February 2002). Those comments were communicated to Ireland, the Italian Republic and the French Republic on 26 March 2002. Ireland submitted its comments on the decision to initiate the formal investigation procedure on 8 January 2002. The Commission asked further information of Ireland on 18 February 2002, which replied on 26 April 2002, after having requested an extension of the time limit set for the reply. After having also requested an extension of the period of time for reply on 21 November 2001, the French Republic commented on the initiating decision on 12 February 2002. The Italian Republic submitted its comments on 6 February 2002. |
236 |
Alumina Decision I was adopted on 7 December 2005. |
237 |
Thus, just over 49 months elapsed between the adoption of the decision to initiate the formal investigation procedure and the adoption of Alumina Decision I. |
238 |
On the face of it, such a period, which was almost double that at issue in the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502), and slightly more than double that provided for in Article 7(6) of Regulation No 659/1999 for completing a formal investigation procedure in the context of notified State aid, appears unreasonable. Nevertheless, in accordance with the case-law, it is appropriate to examine whether that period could not be justified in view of the circumstances of this case. |
239 |
In that regard, the circumstances relied on by the Commission are not, however, capable of justifying an investigation period of 49 months. |
240 |
Indeed, that period does take into account, on the one hand, the period provided to the Member States and the aid recipients for submitting their observations and, on the other, the fact that the French, Irish and Italian Governments requested deadline extensions for the submission of their observations and replies in the formal investigation procedure. Taking into account the direct links, in the present case, between the exemptions from excise duty, in terms of similar measures authorised, in accordance with procedures conducted in parallel, by the same Council decision, it is necessary to take into account all the procedural steps taken in the relevant files and, in particular, the fact that, on 26 April 2002, Ireland replied to the last request for additional information sent by the Commission. |
241 |
However, after that latter date, slightly over 43 months had elapsed before the Commission adopted Alumina Decision I. Such a period for investigating the relevant files, in the light of all the observations provided by the Member States concerned and interested parties, is not justifiable in the circumstances of the present case. |
242 |
First, regarding the alleged difficulty of the files, that allegation has not been proved and, even if that were the case, it cannot justify an investigation period as long as the one in the present case. The file contains no indication of legal problems of any particular significance which the Commission might have encountered, Alumina Decision I being, moreover, of a reasonable length (112 recitals) and apparently not presenting any obvious difficulty in its statements. Next, the Commission was aware of the exemptions from excise duty well before the initiation of the formal investigation procedure, given that the first requests for exemption dated back to 1992 in the case of Ireland, 1993 in the case of the Italian Republic, and 1997 in the case of the French Republic. It is moreover the Commission that sent the successive proposals for authorisation decisions on exemptions from excise duty to the Council, after having received requests to that effect from the French Republic, Ireland and the Italian Republic. Last, in the context of its reports concerning State aid, the Commission informed the WTO of the existence of the Irish exemption. |
243 |
In addition, the Commission itself stated that, since 1999, it had regarded the exemptions from excise duty as being contrary to State aid rules. It was therefore in a position, as of that date, to reflect further on the lawfulness of those exemptions under the rules governing that area. |
244 |
Furthermore, the fact that the Commission no longer requested additional information from the French Republic, Ireland or the Italian Republic in the 43 months prior to the adoption of Alumina Decision I shows that it already had, at that stage, all the information necessary for making its decision concerning the exemptions from excise duty. |
245 |
Last, the Commission is not justified in relying on the alleged difficulty arising from the evolution of the Community system of taxation of mineral oils, particularly from the adoption of Directive 2003/96. Alumina Decision I concerns a legal situation that was not governed by the new mineral oil taxation system under Directive 2003/96, which entered into force only from 1 January 2004, but by the one previously applicable. Accordingly, the evolution of the Community system, relied on by the Commission, was irrelevant in this case. That is borne out by the fact that, in Alumina Decision I, the Commission initiated a new formal investigation procedure concerning the exemptions from excise duty on mineral oils used as fuel for the production of alumina in the Gardanne region, in the Shannon region and in Sardinia for the period from 1 January 2004, the date marking the beginning of the application of the new mineral oil taxation system under Directive 2003/96. In any event, it should be pointed out that Alumina Decision I was adopted almost two years after the adoption of Directive 2003/96. However, the mere necessity, alleged by the Commission, of taking account, in Alumina Decision I, of the new mineral oil taxation system under Directive 2003/96 could not suffice to justify a period as long as the one in the present case. |
246 |
Under such circumstances, the Commission had good knowledge of the legal and factual context of the exemptions from excise duty and encountered no obvious difficulty in relation to examining them under the State aid rules. |
247 |
Second, as regards the practical and linguistic difficulties alleged by the Commission, even assuming they were proved, they cannot justify a period as long as the one in this case. In any event, the Commission had services enabling it to address the linguistic difficulties it alleges and examine in parallel the exemptions from excise duty within significantly shorter deadlines than those in the present case, owing primarily to good coordination of its services. |
248 |
Accordingly, the investigation period for the aid at issue is, in this case, unreasonable. |
249 |
In the second place, it is appropriate to examine whether the Commission’s delay in adopting the contested decision could give AAL reasonable grounds to believe that the Commission’s doubts no longer existed and that the exemption at issue would encounter no objection, and whether that delay was such as to prevent the Commission from requesting the recovery of the aid granted between 3 February 2002 and 31 December 2003 on the basis of that exemption, as was found in the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502, paragraph 16). |
250 |
In that judgment, the Court of Justice indeed held that the period of 26 months taken by the Commission to adopt its decision had been such as to cause the applicant, the recipient of the aid, to have a legitimate expectation which could prevent the Commission from instructing the national authorities to order repayment of that aid. |
251 |
However, whilst it is important to ensure compliance with requirements of legal certainty which protect private interests, those requirements must be balanced against requirements which protect public interests, including, in the area of State aid, the interest in preventing the operation of the market from being distorted by State aid injurious to competition, a fact which, in accordance with settled case-law, requires unlawful aid to be repaid in order to reestablish the previously existing situation (see judgment of 5 August 2003 in P & O European Ferries (Vizcaya) and Diputación Foral de Vizcaya v Commission, T‑116/01 and T‑118/01, ECR, EU:T:2003:217, paragraphs 207 and 208 and the case-law cited). |
252 |
The case-law has thus interpreted the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502) as meaning that the specific circumstances that gave rise to it played a decisive role in the approach taken by the Court of Justice (see, to that effect, judgments in Italy v Commission, cited in paragraph 214 above, EU:C:2004:240, paragraph 90; Italy v Commission, cited in paragraph 120 above, EU:C:2004:234, paragraph 119; Diputación Foral de Álava and Others v Commission, cited in paragraph 217 above, EU:T:2009:314, paragraph 286; and Diputación Foral de Álava and Others, cited in paragraph 217 above, EU:T:2009:316, paragraph 344). In particular, account was taken of the fact that the aid at issue in the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502) had been granted before the Commission opened the formal investigation procedure pertaining to that case. In addition, that aid had been formally notified to the Commission, admittedly after it had been paid. Moreover, it concerned supplementary costs of aid authorised by the Commission and a sector which had, since 1977, received aid authorised by the Commission. Last, examining the compatibility of the aid did not require an in-depth investigation. |
253 |
All of the exceptional circumstances present in the case that gave rise to the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502) are not to be found in the present case. Certainly, as in the case that gave rise to the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502), at the time when the Commission apparently remained inactive, it already had good knowledge of the exemption at issue and thus had been in a position to form an opinion on the lawfulness of that aid under the State aid rules, with the result that it no longer had to carry out an in-depth investigation in that regard. However, other essential circumstances found in the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502) are lacking in the present case. In particular, in the present case, the aid at issue was granted after the initiation, by the Commission, of the formal investigation procedure concerning the exemption at issue. |
254 |
That fundamentally differentiates the specific circumstances of the case that gave rise to the judgment in RSV v Commission, cited in paragraph 216 above (EU:C:1987:502) from those found in the present case. |
255 |
Moreover, account should be taken of the fact that, in paragraph 52 of the judgment of 11 November 2004 in Demesa and Territorio Histórico de Álava v Commission (C‑183/02 P and C‑187/02 P, ECR, EU:C:2004:701), the Court of Justice held, in relation to exceptional circumstances on the basis of which the recipient of unlawful aid could legitimately assume such aid to be lawful, that any apparent failure to act on the part of the Commission was irrelevant when an aid scheme had not been notified to it. Such a solution applies also in a case where, as in the present cases, an aid scheme was implemented without giving prior notice of the implementation as required by the Lorenz case-law (see paragraph 220 above) and, therefore, without the procedure laid down in Article 88 EC being followed in full (see the case-law cited in paragraph 214 above). Thus, in the present case, the Commission’s apparent inaction for 43 months after Ireland’s reply to the last request for additional information of the Commission (see paragraph 241 above) — as inconsistent with the principle that action must be taken within a reasonable time as it may be — is nevertheless not particularly significant from the perspective of applying the State aid rules to the aid at issue, which was implemented unlawfully. Therefore, it is insufficient for finding the existence of exceptional circumstances capable of having given rise, on the part of AAL, to a legitimate expectation that the aid at issue was lawful under the State aid rules. It follows that the mere infringement, in the present case, of the principle that action must be taken within a reasonable time in the adoption of Alumina Decision I did not prevent, in that decision, the Commission from ordering the recovery of the aid at issue. |
256 |
Therefore, the arguments alleging failure to act within a reasonable time must be rejected. |
257 |
So far as concerns the argument put forward by Ireland alleging failure to act within the 18-month period referred to in Article 7(6) of Regulation No 659/1999, it must be pointed out that that provision provides only that, in the case of notified aid, ‘the Commission shall as far as possible endeavour to adopt a decision within a period of 18 months from the opening of the [formal investigation] procedure’. It does not follow from that article that the mere expiry of the period mentioned therein prevents the Commission from being able to recover aid, subject to the limitation period of 10 years laid down in Article 15(1) of Regulation No 659/1999. Article 7(7) of Regulation No 659/1999 provides that, ‘once the time limit referred to in paragraph 6 has expired, and should the Member State concerned so request, the Commission shall, within two months, take a decision on the basis of the information available to it’. Accordingly, the present argument must be rejected as unfounded. |
258 |
The argument put forward by AAL based on the fact that the Commission publicly welcomed the adoption by the Council of Directive 2003/96 is without merit, since the fact that Article 18(1) of Directive 2003/96, read in combination with Article 28(2) of that same directive, authorised Ireland to continue to apply the exemption at issue from 1 January 2003 is of no relevance to whether AAL could have had a legitimate expectation that the exemption at issue was lawful under the State aid rules. At the date on which Article 18(1) of Directive 2003/96 became applicable, namely on 1 January 2003, AAL had to be informed of the existence of an ongoing formal investigation procedure concerning the exemption at issue, and of the fact that, if the exemption at issue constituted State aid, it had to be authorised by the Commission, in accordance with Article 88 EC. That situation could not be altered by the adoption and entry into force of Directive 2003/96, on 27 and 31 October 2003, respectively, recital 32 of which explicitly states that that directive ‘does not prejudice the outcome of any future State aid procedure that may be undertaken in accordance with Articles 87 [EC] and 88 [EC]’ (see, to that effect and by analogy, judgment in Commission v Ireland and Others, cited in paragraph 27 above, EU:C:2013:812, paragraph 51). Therefore, Article 18(1) of Directive 2003/96 was not capable, after the publication of the decision to initiate the formal investigation procedure, of giving rise, on the part of AAL, to a legitimate expectation that the exemption at issue was lawful under the State aid rules. |
259 |
With regard to the arguments put forward by the applicants alleging that the Commission did not adopt, in the present case, a suspension injunction for the aid at issue, pursuant to Article 11(1) of Regulation No 659/1999, it is sufficient to recall, as has already been pointed out in paragraph 79 above, that that provision does not require the Commission, when certain conditions are satisfied, to adopt a suspension injunction, but merely provides that it may adopt such an injunction, where it deems it necessary. It follows that AAL was not entitled, in the present case, to have drawn any conclusion from the fact that the Commission had not deemed it necessary to adopt a suspension injunction. Accordingly, the applicants’ argument must be rejected as unfounded. |
260 |
So far as concerns the argument put forward by AAL based on the long-term investments it made in its alumina production plant established in the Shannon region, it must be held that the Commission was correct, in the present case, not to have taken them into account. AAL could not justifiably claim that those investments were made on the basis of a legitimate expectation it allegedly had that they could be amortised thanks, inter alia, to the benefit it would derive from the exemption at issue until 31 December 2006. In that regard, it is apparent from AAL’s own statements, in its submissions, that the investments at issue were ‘committed to in autumn 2003’, which is after the publication date of the Commission’s decision to initiate the formal investigation procedure, namely on 2 February 2002. However, as follows from paragraphs 221 to 225 above, after that publication, AAL was no longer entitled to a legitimate expectation that the exemption at issue was lawful under the State aid rules, and that, if it constituted State aid, recovery of the exemption at issue could be ordered by the Commission. As has been noted in paragraph 258 above, the adoption of Directive 2003/96, whose provisions governed only the harmonisation of legislation relating to excise duties, was not capable of giving rise on the part of AAL, after the publication of the decision to initiate the formal investigation procedure, to a legitimate expectation that the aid at issue was lawful under the State aid rules and that it would not be recovered pursuant to those rules. In any event, AAL has submitted no evidence that it made those investments in consideration of the legitimate expectation it allegedly had that those investments could be amortised thanks, inter alia, to the benefit it would derive from the exemption at issue until 31 December 2006. One of the investments was moreover made in the context of a competition, namely the Irish Capacity 2005 Competition, which AAL won in 2003. Accordingly, in the contested decision, the Commission was entitled not to take into account the legitimate expectation, alleged in this case by AAL, that the investments made in its alumina production plant established in the Shannon region could be amortised thanks, inter alia, to the benefit it would derive from the exemption at issue until 31 December 2006. Consequently, the present argument must be rejected as unfounded. |
261 |
As regards, last, Ireland’s argument that, before 31 December 2003, AAL could not cover its losses in the event of repayment of the aid granted under the exemption at issue, it cannot be accepted, without being expanded and substantiated in the reply in Case T‑50/06 RENV II, in which it was formulated. |
262 |
In view of all the foregoing considerations, it must be stated that the applicants have not demonstrated, in the present case, the existence of exceptional circumstances such as to have given AAL reasonable grounds to believe that the Commission’s doubts no longer existed and that the exemption at issue would encounter no objection, which would have prevented the Commission from ordering the recovery of the aid at issue in the contested decision. |
263 |
Accordingly, the third plea raised in support of the action in Case T‑50/06 RENV II and the fourth plea raised in support of the action in Case T‑69/06 RENV II must be rejected as unfounded. |
The complaint alleging infringement of the principle that action must be taken within a reasonable time, relied on in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, and the fifth plea, alleging infringement of the principle that action must be taken within a reasonable time and of the principles of legal certainty and of sound administration, linked to the excessive duration of the formal investigation procedure, raised in support of the action in Case T‑69/06 RENV II
264 |
In the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, Ireland complains, in essence, that the Commission infringed the principle that action must be taken within a reasonable time by its delay in adopting the contested decision (see paragraphs 45 and 51 above). |
265 |
In the context of the fifth plea raised in support of the action in Case T‑69/06 RENV II, AAL claims that the Commission infringed the principle that action must be taken within a reasonable time and the principles of legal certainty and of sound administration by its delay in adopting Alumina Decision I, which took place more than 43 months after the Commission’s receipt, in April 2002, of Ireland’s reply to the last request for additional information sent by that institution. |
266 |
The Commission contends that the present complaint and the present plea should be rejected as unfounded. |
267 |
In that regard, it is appropriate to bear in mind that the fundamental requirement of legal certainty precludes the Commission from indefinitely delaying the exercise of its powers (see judgments of 14 July 1972 in Geigy v Commission, 52/69, ECR, EU:C:1972:73, paragraphs 20 and 21, and Falck and Acciaierie di Bolzano v Commission, cited in paragraph 215 above, EU:C:2002:524, paragraph 140). |
268 |
Moreover, it is a principle of sound administration that the Commission must act within a reasonable time when it adopts decisions following administrative proceedings relating to competition policy (see judgment of 20 October 2011 in Eridania Sadam v Commission, T‑579/08, EU:T:2011:608, paragraph 79 and the case-law cited). Thus, in matters of State aid, if the Commission decides to initiate the formal investigation procedure it has a reasonable period within which to complete this procedure (order of 11 July 1979 in Fédération nationale des producteurs de vins de table et vins de pays v Commission, 59/79, ECR, EU:C:1979:188, p. 2425, p. 2428). |
269 |
In the present case, as is stated in paragraph 248 above, the investigation period for the aid at issue is indeed unreasonable. |
270 |
However, infringement of the principle that action must be taken within a reasonable time justifies the annulment of the decision adopted following that delay only in so far as it also constitutes a violation of the rights of defence of the undertakings concerned. Where it has not been established that the undue delay has adversely affected the ability of the undertakings concerned to defend themselves effectively, failure to comply with the principle that the Commission must act within a reasonable time cannot affect the validity of the administrative procedure and can therefore be regarded only as a cause of damage capable of being relied on before the EU judicature (see judgment in Eridania Sadam v Commission, cited in paragraph 268 above, EU:T:2011:608, paragraph 80 and the case-law cited). |
271 |
In any event, it is appropriate to point out that, during the investigation stage under Article 88(2) EC, interested parties like AAL in the present case — far from enjoying the same rights of defence as those which persons against whom a procedure has been initiated are recognised as having — have only the right to be involved in the administrative procedure to the extent appropriate in the light of the circumstances of the case (see judgment in Eridania Sadam v Commission, cited in paragraph 268 above, EU:T:2011:608, paragraph 81 and the case-law cited). |
272 |
In the present case, the applicants do not claim that AAL’s right to be heard and involved in the procedure to the extent appropriate in the light of the circumstances of the case was disregarded by the Commission, during the formal investigation procedure. |
273 |
Accordingly, the complaint alleging infringement of the principle that action must be taken within a reasonable time, relied on in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II and the fifth plea raised in support of the action in Case T‑69/06 RENV II must be rejected as unfounded. |
274 |
Since all the pleas and complaints raised in support of the actions have been rejected, those actions themselves must be rejected in their entirety. |
Costs
275 |
Pursuant to Article 219 of the Rules of Procedure of the General Court, in decisions of the General Court given after its decision has been set aside and the case referred back to it, it is to decide on the costs relating to the proceedings instituted before it and to the proceedings on the appeal before the Court of Justice. Given that, in the judgments in Commission v Ireland and Others, cited in paragraph 22 above (EU:C:2009:742), and Commission v Ireland and Others, cited in paragraph 27 above (EU:C:2013:812), the Court of Justice reserved the costs, it is for the General Court also to decide, in the present case, on the costs relating to those appeal proceedings. |
276 |
Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. However, according to Article 135(1) of the Rules of Procedure, exceptionally, if equity so requires, the General Court may decide that an unsuccessful party is to pay only a proportion of the costs of the other party in addition to bearing his own. In addition, according to Article 135(2) of the same regulation, the General Court may order a party, even if successful, to pay some or all of the costs, if this appears justified by the conduct of that party, including before the proceedings were brought. The General Court may inter alia order an institution whose decision has not been annulled to pay the costs on account of the inadequacy of that decision, which may have led an applicant to bring an action (see, by analogy, judgment of 9 September 2010 in Evropaïki Dynamiki v Commission, T‑387/08, EU:T:2010:377, paragraph 177 and the case-law cited). |
277 |
The applicants have been unsuccessful. However, in the examination of the present actions, it was stated, in paragraph 248 above, that the Commission had infringed the principle that action must be taken within a reasonable time, when adopting the contested decision, which might have induced the applicants to bring the actions, to have that infringement established. In those circumstances, the General Court considers it just and equitable, as regards Cases T‑50/06, T‑50/06 RENV I and T‑50/06 RENV II, to order Ireland to bear its own costs and to pay three quarters of the costs incurred by the Commission, that institution being ordered to bear one quarter of its own costs, and, as regards Cases T‑69/06, T‑69/06 RENV I and T‑69/06 RENV II, to order AAL to bear its own costs and to pay three quarters of the costs incurred by the Commission, that institution being ordered to bear one quarter of its own costs. In Case T‑69/06 R, on the other hand, it is appropriate to order AAL to pay all the costs. With regard to Cases C‑89/08 P and C‑272/12 P, in so far as five parties were opposed to the Commission in each of those cases, it is appropriate, under the apportionment formula used in Cases T‑50/06, T‑50/06 RENV I and T‑50/06 RENV II as well as in Cases T‑69/06, T‑69/06 RENV I and T‑69/06 RENV II, to order Ireland and AAL each to bear their own costs and to pay three twentieths, namely one fifth of three quarters, of the costs incurred by the Commission and to order that institution to bear one fifth of its own costs. |
On those grounds, THE GENERAL COURT (First Chamber, Extended Composition), hereby: |
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Kanninen Pelikánová Buttigieg Gervasoni Madise Delivered in open court in Luxembourg on 22 April 2016. [Signatures] |
Table of contents
Background to the dispute |
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The exemption at issue |
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Administrative procedure |
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Alumina Decision I |
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Procedure and forms of order sought by the parties |
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Law |
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(i) The second plea, alleging infringement of the principle of legal certainty, the estoppel principle and of Article 8(5) of Directive 92/81, and the fourth plea, alleging infringement of the estoppel principle and misuse of powers, raised in support of the action in Case T‑50/06 RENV II, and (ii) the second plea, alleging infringement of the principles of legal certainty and of the effet utile of acts of the institutions and that the Commission exceeded its competence and misused its powers, raised in support of the action in Case T‑69/06 RENV II |
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The third plea, alleging infringement of the requirements under Article 3(1)(m) EC and Article 157 EC, raised in support of the action in Case T‑69/06 RENV II |
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The sixth plea, alleging breach of the obligation to state reasons and infringement of Article 87(1) EC, raised in support of the action in Case T‑69/06 RENV II |
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The first pleas raised in support of the present action, alleging an error of law in the classification of the aid at issue in the light of Article 88 EC |
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The first part of the first plea raised in support of the action in Case T‑50/06 RENV II and the second part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging infringement of Article 88 EC and of the rule codified in Article 1(b)(iii) of Regulation No 659/1999 and, in Case T‑50/06 RENV II, infringement of the procedural rules relating to existing aid schemes, as codified in Articles 17 and 18 of Regulation No 659/1999 |
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The second part of the first plea raised in support of the action in Case T‑50/06 RENV II and the third part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging infringement of the provisions of Article 88 EC read in conjunction with Articles 1(b)(iv) and 15(3) of Regulation No 659/1999 |
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The third part of the first plea raised in support of the action in Case T‑50/06 RENV II and the first part of the first plea raised in support of the action in Case T‑69/06 RENV II, alleging, in essence, infringement of Article 88 EC and the rule codified in Article 1(b)(i) of Regulation No 659/1999 |
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The third plea, alleging infringement of the principle of the protection of legitimate expectations, raised in support of the action in Case T‑50/06 RENV II, and the fourth plea, alleging infringement of the principles of protection of legitimate expectations and of legal certainty, raised in support of the action in Case T‑69/06 RENV II |
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The complaint alleging infringement of the principle that action must be taken within a reasonable time, relied on in the context of the fourth plea raised in support of the action in Case T‑50/06 RENV II, and the fifth plea, alleging infringement of the principle that action must be taken within a reasonable time and of the principles of legal certainty and of sound administration, linked to the excessive duration of the formal investigation procedure, raised in support of the action in Case T‑69/06 RENV II |
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Costs |
( *1 ) Language of the case: English.