Judgments nº T-189/08 of The General Court, March 18, 2010

• Resolution Date: March 18, 2010
• Issuing Organization: The General Court
• Decision Number: T-189/08

In Case T‑189/08,

Forum 187 ASBL, established in Brussels (Belgium), represented by A. Sutton and G. Forwood, Barristers,

applicant,

v

European Commission, represented by N. Khan and C. Urraca Caviedes, acting as Agents,

defendant,

ACTION for the annulment of Commission Decision 2008/283/EC of 13 November 2007 amending Decision 2003/757/EC on the aid scheme implemented by Belgium for coordination centres established in Belgium (OJ 2008 L 90, p. 7), in so far as it does not provide reasonable prospective transitional periods for the coordination centres concerned by the judgment of the Court of Justice in Joined Cases C‑182/03 and C‑217/03 Belgium and Forum 187 v Commission [2006] ECR I‑5479,

THE GENERAL COURT (Eighth Chamber),

composed of M.E. Martins Ribeiro, President, S. Papasavvas (Rapporteur) and A. Dittrich, Judges,

Registrar: K. Pocheć, Administrator,

having regard to the written procedure and further to the hearing on 6 July 2009,

gives the following

Judgment

Background to the dispute

1 The Belgian tax scheme for coordination centres, which is an exception to the ordinary law, was established by Royal Decree No 187 of 30 December 1982 concerning the establishment of coordination centres (Arrêté royal n o 187 relatif à la création de centres de coordination, Moniteur belge, 13 January 1983, p. 502), as supplemented and amended on several occasions.

2 To benefit from that scheme, a coordination centre must first be individually authorised by a royal decree. To obtain authorisation, the centre must form part of a multinational group with capital and reserves of at least BEF 1 000 million and an annual consolidated turnover of at least BEF 10 000 million. Only certain preparatory, ancillary or centralisation measures are authorised, and undertakings in the financial sector are excluded from the scheme. Centres must employ at least the equivalent of 10 full-time employees in Belgium at the end of the first two years of their activity.

3 An authorisation granted to a centre is valid for 10 years and renewable for the same duration.

4 The tax scheme for coordination centres was examined by the Commission of the European Communities when it was introduced. In particular, in decisions communicated in the form of letters on 16 May 1984 and 9 March 1987, the Commission found essentially that such a scheme, based on a system of flat-rate assessment of the income of the coordination centres, did not contain an aid element.

5 After adopting, on 11 November 1998, a notice on the application of the State aid rules to measures relating to direct business taxation (OJ 1998 C 384, p. 3), the Commission undertook a general review of the tax legislation of the Member States from the point of view of the rules on State aid.

6 In that connection the Commission, on 12 February 1999, asked the Belgian authorities for certain information relating inter alia to the scheme for coordination centres. They replied in March 1999.

7 In July 2000 the Commission informed the Belgian authorities that the scheme appeared to constitute State aid. With a view to initiating the cooperation procedure in accordance with Article 17(2) 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), the Commission requested the Belgian authorities to submit their comments within a period of one month.

8 On 11 July 2001 the Commission adopted four proposals for appropriate measures on the basis of Article 88(1) EC, concerning inter alia the scheme for coordination centres. It proposed that the Belgian authorities should accept a number of changes to the scheme, while providing as a transitional measure that centres authorised before the date of acceptance of those measures could continue to benefit from the previous scheme until 31 December 2005.

9 Since the Belgian authorities did not accept the appropriate measures proposed, the Commission initiated the formal investigation procedure by a decision notified by letter of 27 February 2002 (OJ 2002 C 147, p. 2), in accordance with Article 19(2) of Regulation No 659/1999. It invited the Kingdom of Belgium to submit comments and provide any information relevant to the assessment of the measure in question. It also invited that Member State and interested third parties to submit comments and provide any information relevant to determining whether the beneficiaries of the scheme at issue had a legitimate expectation that transitional measures would be laid down.

10 On 13 September 2002 the applicant brought an action for annulment of the decision to initiate the formal investigation procedure (Case T‑276/02).

11 Following the formal investigation procedure, the Commission on 17 February 2003 adopted Decision 2003/757/EC on the aid scheme implemented by Belgium for coordination centres established in Belgium (OJ 2003 L 282, p. 25, ‘the 2003 decision’).

12 According to Articles 1 and 2 of the 2003 decision:

‘Article 1

The tax scheme which currently operates in Belgium for the benefit of coordination centres approved under Royal Decree No 187 constitutes aid incompatible with the common market.

Article 2

Belgium is required to withdraw the aid referred to in Article 1 or to amend it in such a way as to make it compatible with the common market.

As of the date of notification of this Decision, the benefits of this scheme or sections thereof may no longer be granted to new beneficiaries or maintained by renewing existing agreements.

With regard to centres approved before 31 December 2000, the scheme may be maintained until the expiry date of the individual approval applying on the date of notification of this Decision and until 31 December 2010 at the latest. In accordance with the second paragraph, if approval is renewed prior to that date the benefits of the scheme dealt with in this Decision may no longer be granted, even temporarily.’

13 On 6 March 2003 the Kingdom of Belgium approached simultaneously the Commission and the Council, asking them for ‘the necessary to be done in order for the coordination centres whose approval expires after 17 February 2003 to be extended until 31 December 2005’. That request was repeated on 20 March and 26 May 2003 on the basis of the third subparagraph of Article 88(2) EC.

14 On 25 and 28 April 2003 the Kingdom of Belgium and the applicant association, Forum 187, a grouping of coordination centres, brought actions for the suspension and annulment of all or part of the 2003 decision (Cases C‑183/03 and T‑140/03, later C‑217/03; Cases C‑182/03 R and T‑140/03 R, later C‑217/03 R).

15 By order of 2 June 2003 in Case T‑276/02 Forum 187 v Commission [2003] ECR II‑2075, the action for annulment of the decision to initiate the formal investigation procedure was dismissed as inadmissible.

16 By order of 26 June 2003 in Joined Cases C‑182/03 R and C‑217/03 R Belgium and Forum 187 v Commission [2003] ECR I‑6887 (‘the Forum 187 order’), the President of the Court of Justice ordered the operation of the 2003 decision to be suspended in so far as it prohibited the Kingdom of Belgium from renewing the authorisations of coordination centres which were current at the date of notification of that decision.

17 As they were allowed to do by the Forum 187 order, the Belgian authorities renewed the authorisations of coordination centres which expired between 17 February 2003 and 31 December 2005. With the exception of four centres which were granted renewals for an indefinite period, the authorisations were all renewed for a period expiring on 31 December 2005.

18 By Council Decision 2003/531/EC of 16 July 2003 on the granting of aid by the Belgian Government to certain coordination centres established in Belgium (OJ 2003 L 184, p. 17), adopted on the basis of Article 88(2) EC, the ‘aid which Belgium plan[ned] to grant in the period up to 31 December 2005 to undertakings authorised as at 31 December 2000 to act as coordination centres under Royal Decree No 187 … and whose authorisations expire between 17 February 2003 and 31 December 2005’ was declared compatible with the common market. On 24 September 2003 the Commission brought an action for the annulment of that decision (Case C‑399/03).

19 On 22 June 2006 the Court of Justice annulled the 2003 decision in part, in so far as it did not lay down transitional measures for the coordination centres whose applications for renewal of authorisation were pending on the date of notification of that decision, or whose authorisations expired at the same time as or shortly after that notification (Joined Cases C‑182/03 and C‑217/03 Belgium and Forum 187 v Commission [2006] ECR I‑5479, ‘the Forum 187 judgment’). On the same date the Court of Justice also annulled Decision 2003/531, by its judgment in Case C‑399/03 Commission v Council [2006] ECR I‑5629).

20 By letter of 4 July 2006, the Commission requested the Belgian authorities to provide it with certain information within 20 working days, so that it could decide how to react to the Forum 187 judgment.

21 On 27 December 2006 the Kingdom of Belgium adopted a Law on miscellaneous provisions (Loi portant des dispositions diverses, Moniteur belge, 28 December 2006, p. 75266, ‘the 2006 law’) allowing the extension to 31 December 2010 of the authorisations of all coordination centres which applied for extensions, if necessary with retroactive effect. In addition to the centres whose authorisations had been renewed following the Forum 187 order between 17 February 2003 and 31 December 2005, the 2006 law provided that the possibility of extension would also be available to centres whose authorisations expired between 1 January 2006 and 31 December 2010, and to an unspecified number of centres whose authorisations would have expired on or before 31 December 2005 but which had not applied for renewal by that date. The law was not notified to the Commission under Article 88(3) EC, but its entry into force was...