Keywords
Summary

Keywords

1 Procedure - Introduction of new pleas in law in the course of proceedings - Conditions - New matter - Concept

(Rules of Procedure of the Court of First Instance, Art. 48(2))

2 Competition - Public undertakings and undertakings to which the Member States grant special or exclusive rights - Commission's powers under its duty of supervision - Discretion - Review by the Court - Limits

(EC Treaty, Arts 90(2) and (3), 92(3) and 173)

3 Procedure - Introduction of new pleas in law in the course of proceedings - Conditions - New plea in law - Concept - Close link between arguments based on Article 90(2) of the Treaty and arguments based on Article 92 of the Treaty

(EC Treaty, Arts 90 and 92; Rules of Procedure of the Court of First Instance, Art. 48(2))

4 State aid - Concept - Grant by the public authorities of a tax concession to a public undertaking - Included

(EC Treaty, Art. 92(1))

5 State aid - Prohibition - Derogations - Aid paid to an undertaking entrusted with the operation of a service of general economic interest - Conditions - Commission's discretion

(EC Treaty, Arts 90(2), 92 and 93(2) and (3))

6 State aid - Examination by the Commission - Factors to be taken into consideration

(EC Treaty, Art. 92)

Summary

7 A judgment of the Community judicature which merely confirms the law which was in principle known to the applicant when it brought its action cannot be regarded as a new matter allowing a fresh plea to be raised.

8 It is clear from Article 90(3) of the Treaty and from the entire scheme of that article that the Commission's power of supervision vis-à-vis Member States liable for infringing the rules of the Treaty necessarily entails the exercise of a discretion on that institution's part. That discretion is notably wider in relation to compliance by Member States with the competition rules because, in the first place, Article 90(2) requires the Commission to take account of the demands inherent in the particular tasks of the undertakings concerned and, secondly, because the authorities of the Member States may, for their part, in some instances have an equally broad discretion in regulating certain matters such as the organization of public services in the postal sector.

In that respect, the degree of latitude in assessing complex economic facts, such as the evaluation of the additional costs to which an undertaking's obligations as a public postal service give rise, in the context of the application by the Commission of Article 90(2) of the Treaty is comparable with the discretion exercised by the Commission when applying Article 92(3) of the Treaty.

Since the Community judicature may not, in an action for annulment, substitute its own assessment of the facts for that of the deciding authority, especially in the economic sphere, the review which the Court of First Instance is called upon to exercise in relation to the Commission's assessment must be confined to verifying the accuracy of the facts found and establishing that there is no manifest error of assessment.

9 A plea which is submitted at the reply stage and which is really only an amplification of a plea previously put forward, either expressly or by implication, in the originating application and which is closely linked to that previous plea must be regarded as admissible. In that regard, since Articles 90 and 92 of the Treaty are closely linked, where, in the contested decision, the Commission decides, pursuant to Article 90(2), not to classify the State measure in question as State aid within the meaning of Article 92, arguments put forward for the first time in the reply concerning breach of Article 90(2) of the Treaty may be regarded as simply amplifying a plea, previously put forward, alleging breach of Article 92 of the Treaty.

10 A measure by which the public authorities grant to a public undertaking a tax concession which, although not involving a transfer of State resources, places the recipient in a more favourable financial situation than that of other taxpayers, constitutes State aid within the meaning of Article 92(1) of the Treaty.

11 It follows from the wording of Article 90(2) of the Treaty that, where that provision may be relied on, a State measure caught by Article 92(1) of the Treaty may nevertheless be considered to be compatible with the common market. Although the aid involved is still State aid within the meaning of the latter provision, the effect of the competition rules may nevertheless be curtailed in such a case, so that a prohibition on giving effect to new aid, inferred from Articles 92 and 93(2) and (3) read together, may be declared inapplicable.

Because Article 90(2) of the Treaty lays down a derogating rule, it must be interpreted restrictively. So, in order that the derogation from the application of the rules of the Treaty provided for by that provision may apply, it is not sufficient that the undertaking in question has been entrusted by the public authorities with the operation of a service of general economic interest; the application of the rules of the Treaty must also obstruct the performance of the particular task assigned to the undertaking and the interests of the Community must not be affected.

That being so, payment of State aid may, under Article 90(2) of the Treaty, escape the prohibition laid down in Article 92 of that Treaty provided that the sole purpose of the aid in question is to offset the additional costs incurred in performing the particular task assigned to the undertaking entrusted with the operation of a service of general economic interest and that the grant of the aid is necessary in order for that undertaking to be able to perform its public service obligations under conditions of economic equilibrium. Determining whether the aid is necessary entails a general assessment of the economic conditions in which the undertaking in question performs the activities in the reserved sector, without taking account of any benefits it may draw from the sectors open to competition. In that respect, the Commission must be allowed a certain discretion in deciding on the most appropriate method for making sure that the grant of the aid does not involve any cross-subsidy for the benefit of the competitive activities of the undertakings concerned.

12 The classification of a State measure, from the point of view of Article 92 of the Treaty, must be based on its effect on competition. That provision does not make any distinction according to the causes or aims of the aid in question but defines them in relation to their effects.