Action brought on 8 February 2005 by Ireland against the Commission of the European Communities

(Case T-56/05)

(2005/C 106/61)

Language of the case: English

An action against the Commission of the European Communities was brought before the Court of First Instance of the European Communities on 8 February 2005 by Ireland represented by D.J. -O'Hagan, agent, assisted by P. Gallagher and P. McGarry, Barristers, and with an address for service in Luxembourg.

The applicant claims that the Court should:

Pleas in law and main arguments

By virtue of Commission Decision C(97) 4090 of 15 December 1997, assistance was granted from the Cohesion Fund to Project 96/07/61/007 (Dublin Region Water Supply Scheme — Stage III) in Ireland. By Commission Decision C (96) 2113 of 29 July 1996 assistance was granted from the Cohesion Fund to Project No. 95/07/65/007, (N1 Dunleer — Dundalk Road Stage II), also in Ireland. By the contested decision the Commission reduced the amounts of total assistance granted under the two previous decisions, invoking various irregularities found during the examination of the projects concerned. The Commission also decided that a total amount of EUR 797 886 had been unduly received and should be recovered by reimbursement.

In support of its application to annul the contested decision the applicant submits first of all that the contested decision is invalid, having been adopted more than three months after the date of the oral hearing, in violation of Article 18(3) Regulation 1386/2002 (1) and Article H(2) of Annex II to Regulation 1164/94 (2). According to the applicant this constitutes a breach of an essential procedural requirement as well as an infringement of the principle of legal certainty.

The applicant also argues that the Commission committed a further breach of the principle of legal certainty by retrospectively applying new guidelines of eligibility of expenditure in such a way as to change its interpretation of who constituted the ‘final beneficiary’ and thus render expenses ineligible as having been made outside the relevant period. According to the applicant this also violated its legitimate expectations.

A further breach of the principle of legal certainty was, in the applicant's view, the retrospective application of flat rate financial correction. This concept was, the applicant claims, first developed and enunciated in guidelines adopted by the Commission in 2002.

The applicant finally submits that the retrospective application of the Commission's new approach to the practice of substitution of eligible for ineligible expenditure constitutes a further breach of the principle of legal certainty. According to the applicant it was only in the 2002 Guidelines that the Commission decided that such substitution was no longer permissible. However, the applicant argues, this approach could not be applied to projects dating from 1996 and 1997.

(1)  Commission Regulation (EC) No 1386/2002 of 29 July 2002 laying down detailed rules for the implementation of Council Regulation (EC) No 1164/94 as regards the management and control systems for assistance granted from the Cohesion Fund and the procedure for making financial corrections, OJ L 201 p. 5.

(2)  Council Regulation (EC) No 1164/94 of 16 May 1994 establishing a Cohesion Fund, Official Journal L 130 p. 1.