Commission of the European Communities v Hellenic Republic.

• Jurisdiction: European Union
• Celex Number: 62003CJ0415
• ECLI: ECLI:EU:C:2005:287
• Date: 12 May 2005
• Docket Number: C-415/03
• Court: Court of Justice (European Union)
• Procedure Type: Recurso por incumplimiento – fundado

Case C-415/03

Commission of the European Communities

v

Hellenic Republic

(State aid – Obligation to recover – Absolute impossibility of implementation – Absence)

Opinion of Advocate General Geelhoed delivered on 1 February 2005

Judgment of the Court (Second Chamber), 12 May 2005

Summary of the Judgment

1. Actions for failure to fulfil obligations — Failure to comply with the obligation to recover aid granted — Grounds of defence — Absolute impossibility of implementation — Assessment criteria — Difficulties in implementation — Obligation on the Commission and the Member State to cooperate in seeking a solution consistent with the Treaty

(Arts 10 EC and 88(2) EC)

2. Actions for failure to fulfil obligations — Failure to comply with a Commission decision relating to State aid — Grounds of defence — Plea questioning the lawfulness of the decision — Inadmissible

3. State aid — Commission decision finding aid to be incompatible with the common market and ordering it to be repaid — Commission’s power to leave the calculation of the exact amount to be repaid to the national authorities

1. The only defence available to a Member State in opposing an application by the Commission under Article 88(2) EC for a declaration that it has failed to fulfil its Treaty obligations is to plead that it was absolutely impossible for it properly to implement the decision ordering recovery of the aid in question.

The condition that it be absolutely impossible to implement a decision is not fulfilled, as regards a Commission decision relating to State aid, where the defendant government merely informs the Commission of the legal, political or practical difficulties involved in implementing the decision, without taking any real step to recover the aid from the undertakings concerned, and without proposing to the Commission any alternative arrangements for implementing the decision which could have enabled those difficulties to be overcome. Where the implementation of such a decision encounters only a certain number of national difficulties, the Commission and the Member State concerned must respect the principle underlying Article 10 EC, which imposes a duty of genuine cooperation on the Member States and the Community institutions, and must work together in good faith with a view to overcoming difficulties whilst fully observing the Treaty provisions, and in particular the provisions on State aid.

(see paras 35, 42-43)

2. In the context of an action which concerns the failure to implement a decision on State aid which has not been referred to the Court by the Member State to which it is addressed, the latter is not justified in challenging the lawfulness of such a decision.

(see para. 38)

3. No provision of Community law requires the Commission, when ordering the recovery of aid declared incompatible with the common market, to fix the exact amount of the aid to be recovered. It is sufficient for the Commission’s decision to include information enabling the recipient to work out himself, without overmuch difficulty, that amount. The Commission can therefore legitimately confine itself to declaring that there is an obligation to repay the aid in question and leave it to the national authorities to calculate the exact amounts to be repaid. Furthermore, as the operative part of a decision on State aid is indissociably linked to the statement of reasons for it, so that, when it has to be interpreted, account must be taken of the reasons which led to its adoption, the amounts to be repaid pursuant to the Commission’s decision can be established by reading the grounds thereof.

(see paras 39-41)

JUDGMENT OF THE COURT (Second Chamber)

12 May 2005 (*)

(State aid – Obligation to recover – Absolute impossibility of implementation – Absence)

In Case C-415/03,

ACTION under Article 88(2) EC for failure to fulfil obligations, brought on 25 September 2003,

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

applicant,

v

Hellenic Republic, represented by A. Samoni-Rantou, and by P. Mylonopoulos, F. Spathopoulos and P. Anestis, acting as Agents, with an address for service in Luxembourg,

defendant,

THE COURT (Second Chamber),

composed of C.W.A. Timmermans, President of the Chamber, R. Silva de Lapuerta (Rapporteur), R. Schintgen, G. Arestis and J. Klučka, Judges,

Advocate General: L.A. Geelhoed,

Registrar: M. Ferreira, Principal Administrator,

having regard to the written procedure and further to the hearing on 8 December 2004,

after hearing the Opinion of the Advocate General at the sitting on 1 February 2005,

gives the following

Judgment

1 By its action, the Commission of the European Communities asks the Court to declare that, by failing to take within the prescribed period all the measures necessary for repayment of the aid found to be unlawful and incompatible with the common market – except that relating to the contributions to the national social security institution (‘the IKA’) –, in accordance with Article 3 of Commission Decision 2003/372/EC of 11 December 2002 on aid granted by Greece to Olympic Airways (OJ 2003 L 132, p. 1), or, in any event, by failing to inform it of the measures taken pursuant to Article 4 of that decision, the Hellenic Republic has failed to fulfil its obligations under Articles 3 and 4 of that decision and the EC Treaty.

Background to the dispute

2 In 1996 the Commission initiated against the Hellenic Republic the procedure laid down in Article 93(2) of the EC Treaty (now Article 88(2) EC), which led to the adoption of Commission Decision 1999/332/EC of 14 August 1998 on aid granted by Greece to Olympic Airways (OJ 1999 L 128, p. 1; ‘the approval decision’) concerning guarantees, the reduction and conversion to equity of debts approved in 1994, and also other guarantees and capital injections totalling GRD 40.8 billion, to be paid in three instalments of GRD 19, 14 and 7.8 billion. The grant of that aid was coupled with a revised restructuring plan for the period from 1998 to 2002 and was subject to special conditions.

3 Following further complaints about the grant of aid to Olympic Airways, the Commission, by decision of 6 March 2002, initiated the procedure laid down in Article 88(2) EC, on the ground that the company’s restructuring plan had not been implemented and that some of the conditions laid down by the approval decision had not been fulfilled. That decision required the Hellenic Republic to provide the Commission with information pursuant to Article 10 of Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article 88 of the EC Treaty (OJ 1999 L 83, p. 1).

4 On 9 August 2002 the Commission addressed to the Hellenic Republic a further injunction to provide the information previously requested, requiring in particular the production by the latter of the accounts and figures relating to the payment of operating costs to the State. The replies given by the Greek authorities on this subject were deemed insufficient by the Commission.

5 On 11 December 2002 the Commission approved Decision 2003/372, which is based in particular on the findings that most of the objectives of the Olympic Airways restructuring plan had not been attained, that the conditions imposed by the approval decision had not been fully met and that the approval decision was wrongly implemented. In...