Kingdom of Belgium v Commission of the European Communities.

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• Writing for the Court: Kakouris
• ECLI: ECLI:EU:C:1990:125
• Date: 21 March 1990
• Docket Number: C-142/87
• Procedure Type: Recurso de anulación - infundado

Avis juridique important

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61987J0142

Judgment of the Court of 21 March 1990. - Kingdom of Belgium v Commission of the European Communities. - State aid to a steel pipe and tube manufacturer - Recovery. - Case C-142/87.

European Court reports 1990 Page I-00959
Swedish special edition Page 00369
Finnish special edition Page 00387

Summary
Parties
Grounds
Decision on costs
Operative part

Keywords

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1 . State aid - Plans to grant aid - Lack of notice - Implemented before the Commission' s final decision - Commission' s power to issue an interim decision - Refusal to comply with the interim decision - Consequences

( EEC Treaty, Art . 93(2 ) and ( 3 ) )

2 . State aid - Concept - Financial assistance granted by a Member State to an undertaking - Criteria for assessment - Undertaking' s position in regard to the capital market

( EEC Treaty, Art . 92 )

3 . State aid - Concept - Export aid

( EEC Treaty, Arts 92 to 94 and 112 )

4 . State aid - Effect on intra-Community trade - Export aid

( EEC Treaty, Art . 92 )

5 . State aid - Effect on intra-Community trade - Criteria for assessment

( EEC Treaty, Art . 92 )

6 . Community law - Principles - Right to be heard - Application to administrative procedures initiated by the Commission - Consideration of aid projects - Scope

( EEC Treaty, Art . 93(2 ) )

7 . State aid - Prohibition - Derogations - Aid which may be regarded as compatible with the common market - Commission' s discretion - Reference to the Community context

( EEC Treaty, Art . 92(3 ) )

8 . State aid - Recovery of unlawful aid - Infringement of the principle of proportionality - None - Application of national law - Conditions and limits

( EEC Treaty, Article 93(2 ), first subparagraph )

Summary

1 . Once it has established that aid has been granted or altered without notification as required by Article 93(3 ) of the Treaty, the Commission has the power, after giving the Member State in question an opportunity to submit its comments on the matter, to issue an interim decision requiring it to suspend immediately the payment of such aid pending the outcome of the examination of the aid and to provide the Commission, within such period as it may specify, with all such documentation, information and data as are necessary to enable it to examine the compatibility of the aid with the common market . The Commission has the same power in cases where it has been notified of aid but the Member State in question, instead of awaiting the outcome of the procedure provided for under Article 93(2 ) and ( 3 ) of the Treaty, has instead proceeded to put the aid into effect, contrary to the prohibition contained in Article 93(3 ).

Where a Member State has complied in full with the Commission' s order to provide it with the information requested, the Commission is obliged to examine the compatibility of the aid with the common market, in accordance with the procedure laid down in Article 93(2 ) and ( 3 ) of the Treaty . On the other hand, if the Member State, notwithstanding the Commission' s order, fails to provide the information requested, the Commission is empowered to terminate the procedure and to decide, on the basis of the information available to it, whether or not the aid is compatible with the common market . If appropriate, such a decision may call for recovery of the amount of aid which has already been paid .

If the Member State fails to suspend payment of the aid, the Commission is entitled, while pursuing its substantive examination, to refer the matter of the Treaty infringement direct to the Court . Such a referral is justified on grounds of urgency because the decision embodying the order has been taken after the Member State in question has been given an opportunity to submit its comments and thus at the conclusion of a preliminary administrative procedure in which it has been in a position to put its case, as in the case of the action provided for under the second subparagraph of Article 93(2 ) of the Treaty . This action is in fact no more than a variant of the action for a declaration of failure to fulfil Treaty obligations, specifically adapted to the special problems which State aid poses for competition within the common market .

2 . In order to determine whether financial assistance granted by a Member State to an undertaking is in the nature of State aid, the relevant criterion is whether the undertaking could have obtained the amounts in question on the capital market .

3 . Where State aid affects intra-Community trade, Articles 92 to 94 apply even if the aid may be regarded as export aid within the meaning of Article 112, which concerns the harmonization of national export aid in the context of the common commercial policy .

4 . Having regard to the interdependence between the markets on which Community undertakings operate, it is possible that aid might distort competition within the Community, even if the undertaking receiving it exports almost all its production outside the Community . The exportation of part of the undertaking' s production to non-member countries is only one of a number of circumstances which must be considered .

5 . The relatively small amount of aid or the relatively small size of the undertaking which receives it does not as such exclude the possibility that intra-Community trade might be affected .

6 . Observance of the right to be heard is, in all proceedings initiated against a person which are liable to culminate in a measure adversely affecting that person, a fundamental principle of Community law which must be guaranteed even in the absence of specific rules . Applied to the Commission' s examination of plans to grant aid, that principle requires that the Member State in question must be given the opportunity effectively to make known its views on the observations which interested third parties have submitted under Article 93(2 ) and on which the Commission proposes to base its decision . In so far as the Member State has not been afforded the opportunity to comment on those observations, the Commission may not use them in its decision against that State without infringing the right to be heard . For such an infringement of the right to be heard to result in an annulment it must, however, be established that, had it not been for that irregularity, the outcome of the procedure might have been different .

7 . In regard to Article 92(3 ), the Commission has a wide discretion the exercise of which implies economic and social assessments which must be carried out in a Community context .

8 . The recovery of aid unlawfully paid, which cannot in principle be regarded as disproportionate to the objectives of the Treaty provisions concerning State aids, must take place in accordance with the relevant procedural provisions of national law, subject however to the proviso that those provisions are to be applied in such a way that the recovery required by Community law is not rendered practically impossible .

Parties

In Case C-142/87

Kingdom of Belgium, represented by Robert Hoebaer, Director of Administration in the Ministry of Foreign Affairs, Foreign Trade and Development Cooperation, acting as Agent, assisted by Lambert Matray and Charly Hanot, of the Liège Bar, and Gerald Schubert, Rechtsanwalt, Cologne, with an address for service in Luxembourg at the Belgian Embassy, 4 rue des Girondins,

applicant,

v

Commission of the European Communities, represented by Antonino Abate, Legal Adviser, and Hendrik van Lier, a member of its Legal Department, acting as Agents, with an address for service in Luxembourg at the office of Georgios Kremlis, a member of its Legal Department, Wagner Centre, Kirchberg,

defendant,

APPLICATION for the annulment of Decision 87/507/EEC of 4 February 1987, in which the Commission found that the aid granted, in various forms, by the Belgian State to a steel pipe and tube manufacturer was illegal and incompatible with the common market and ordered its recovery,

THE COURT

composed of : O . Due, President, C . N . Kakouris and F . A . Schockweiler ( Presidents of Chambers ), G . F . Mancini, R . Joliet, G . C . Rodríguez Iglesias and M . Diez de...