Action brought on 14 June 2019 — Italy v Commission

(Case T-357/19)

(2019/C 263/64)

Language of the case: Italian

Parties

Applicant: Italian Republic (represented by: P. Gentili, avvocato dello Stato and G. Palmieri, Agent)

Defendant: European Commission

Form of order sought

The applicant claims that the Court should annul Commission Implementing Decision C(2019) 2652 final of 3 April 2019, notified on 4 April 2019, approving the ‘Grande Progetto Nazionale Banda Ultra Larga — Aree Bianche’ (‘Major National Ultra-broadband Project — White Areas’; GP BUL) for an eligible cost of EUR 941 022 670, in so far as it excludes from the European Regional Development Fund (ERDF) contribution the costs incurred by the recipient in respect of VAT, hold that those costs must, on the other hand, be included in the contribution and order the European Commission to pay the costs of the proceedings.

Pleas in law and main arguments

In support of the action, the applicant relies on four pleas in law.

1.	By its first plea in law, the applicant alleges infringement of Article 69(3)(c) of Regulation No 1303/2013 (1) since none of the three reasons for excluding costs on account of VAT corresponds with the VAT being recoverable under national VAT legislation.

By its second plea in law, the applicant alleges (i) infringement of the rules on VAT taxpayers (Articles 9 and 13 of Directive 2006/112/EC (2)) and on the VAT tax authority (Articles 206 and 250 of Directive 2006/112/EC), (ii) failure to comply with national constitutions and the fundamental structures of the Member States (Article 4(2) TEU) and (iii) infringement of Article 69(3)(c) of Regulation No 1303/2013. The applicant submits in this respect that it is not lawful to consider input VAT paid by the Ministry of Economic Development, as recipient of the ERDF contribution, as recoverable because a different Ministry (the Ministry of Finance) received those sums as tax revenue.

By its third plea in law, the applicant alleges infringement of Articles 9, 11, 13 and 28 of Directive 2006/112/EC. According to the applicant, the fact that Infratel is an in-house company of the Ministry of Economic Development does not preclude VAT being charged on transfers of goods and services from that company to that ministry.

4.	By its fourth plea in law, the applicant alleges infringement of Articles 61(8) and 69(3)(c) of Regulation No 1303/2013. The applicant submits that the project in question is being co-funded by the ERDF by way of State aid. It cannot, therefore, be considered a revenue-generating project.

(1) Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17 December 2013 laying down common provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund and laying down general provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund and the European Maritime and Fisheries Fund and repealing Council Regulation (EC) No 1083/2006 (OJ 2013 L 347, p. 320).

(2) Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1).