Orders nº T-77/01 of Court of First Instance of the European Communities, Friday January 11, 2002

• Resolution Date: Friday January 11, 2002
• Issuing Organization: Court of First Instance of the European Communities
• Decision Number: T-77/01

ORDER OF THE COURT OF FIRST INSTANCE (Third Chamber, Extended Composition)

11 January 2002 (1) (Action for annulment - State aid - Aid in the steel sector - Action for annulment - Article 33 CS - Action brought by an intra-State authority - Inadmissibility)

In Case T-77/01,

Territorio Histórico de Álava - Diputación Foral de Álava,

Territorio Histórico de Bizkaia - Diputación Foral de Bizkaia,

Territorio Histórico de Gipuzkoa - Diputación Foral de Gipuzkoa y Juntas Generales de Gipuzkoa,

Comunidad autónoma del País Vasco - Gobierno Vasco,

represented by R. Falcón y Tella, lawyer,

applicants,

v

Commission of the European Communities, represented by G. Rozet and J. Buendía Sierra, acting as Agents, with an address for service in Luxembourg,

defendant,

APPLICATION for annulment of Commission Decision 2001/168/ECSC of 31 October 2000 on Spain's corporation tax laws (OJ 2001 L 60, p. 57),

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (Third Chamber, Extended Composition),

composed of: M. Jaeger, President, R. García-Valdecasas, K. Lenaerts, P. Lindh and J. Azizi, Judges,

Registrar: H. Jung,

makes the following

Order

The relevant provisions and the contested decision

1.

Article 34 of Spanish Law No 43/1995 of 27 December 1995 on corporation tax (Boletín Oficial del Estado No 310 of 28 December 1995) is entitled ‘Deduction for export activities’ and provides:

‘1. Carrying on export activities shall give rise to entitlement to the following deductions from the whole amount:

(a) 25 per cent of the amount of the investment actually made in setting up branches or permanent establishments abroad, as well as in purchasing shares in foreign companies or setting up subsidiaries directly involved in the exportation of goods or services ..., provided that the share held is, at least, 25 per cent of the capital of the subsidiary ...

(b) 25 per cent of the amount incurred by way of promotional and advertising costs over a number of years for the launching of products, opening and testing of markets abroad and attendance at fairs, exhibitions and similar events, including, in this connection, international events held in Spain.

...’

2.

The Territorios Históricos of Álava, Bizkaia and Gipuzkoa, which have independent taxation powers, reproduced in their tax legislation the tax deduction for export activities contained in Article 34 of Law No 43/1995. In the Territorio Histórico de Álava it became Article 43 of Norma Foral (Provincial Act) No 24/1996 of 5 July 1996 (Boletín Oficial del Territorio Histórico de Álava No 90 of 9 August 1996), in the Territorio Histórico de Bizkaia, Article 43 of Norma Foral No 3/1996 of 26 June 1996 (Boletín Oficial de Bizkaia No 135 of 11 July 1996), and in the Territorio Histórico de Gipuzkoa, Article 43 of Norma Foral No 7/1996 of 4 July 1996 (Boletín Oficial de Gipuzkoa No 138 of 17 July 1996).

3.

By letter of 7 August 1997, the Commission informed the Spanish Government that it had decided to initiate proceedings under Article 6(5) of Commission Decision No 2496/96/ECSC of 18 December 1996 establishing Community rules for State aid to the steel industry (OJ 1996 L 338, p. 42).

4.

On 31 October 2000, the Commission adopted Decision 2001/168/ECSC on Spain's corporation tax laws (OJ 2001 L 60, p. 57; ‘the contested decision’). The operative part of the decision states as follows:

‘Article 1

Any aid granted by Spain under:

(a) Article 34 of Act 43/1995 of 27 December 1995 on corporation tax;

(b) Article 43 of Provincial Act 3/96 of 26 June 1996 on corporation tax adopted by the [Diputación Foral de Bizkaia];

(c) Article 43 of Provincial Act 7/1996 of 4 July 1996 on corporation tax adopted by the [Diputación Foral de Gipuzkoa] or

(d) Article 43 of Provincial Act 24/1996 of 5 July 1996 on corporation tax adopted by the [Diputación Foral de Álava],

to ECSC steel undertakings established in Spain is incompatible with the common market in coal and steel.

Article 2

Spain shall forthwith take appropriate measures to ensure that ECSC steel undertakings established in Spain do not receive the aid referred to in Article 1.

...’

Procedure and forms of order sought by the parties

5.

It was in those circumstances that, by application lodged at the Registry of the Court of First Instance on 30 March 2001, the applicants, which are intra-State authorities, brought the present action.

6.

The applicants claim that the Court should:

- annul Article 1(b), (c) and (d) of the contested decision;

- order the Commission to pay the costs.

7.

By a separate document, lodged at the Court Registry on 2 July 2001, the Commission raised an objection of inadmissibility under Article 114(1) of the Rules of Procedure of the Court of First Instance.

8.

In its objection, the Commission contends that the Court should:

- declare the action inadmissible;

- or, in the alternative, decide, as a measure of organisation of procedure, to stay proceedings until the Court of Justice delivers judgment in Case C-501/00 Spain v Commission or, in the further alternative, decline jurisdiction in order that the Court of Justice may give a ruling on this action;

- order the applicants to pay the costs.

9.

In their observations on...