Judgment of the General Court First Chamber, 7 September 2022, JCDecaux Street Furniture Belgium v Commission, T-642/19

• Date: 07 September 2022
• Year: 2022

39

concerned as regards demonstration of the existence of State aid in the light of the conditions set out

in the Guarantee Notice.

Findings of the Court

The General Court starts by noting that the Commission had based its finding that the Greek

authorities had not behaved like a reasonable market creditor in granting the 2008 guarantee, on

grounds comprising two parts, one based on Larko’s status as a firm in difficulty and the other based

on the fact that there had been no payment of a premium in line with the market price.

However, in the judgment on appeal, the Court of Justice had not criticised the Commission’s

reasoning regarding the fact that there had been no payment of a premium in line with the market

price, finding, on the contrary, that there was no need to examine Larko’s arguments in that regard.

Furthermore, in view of the cumulative nature of the two parts of the grounds put forward by the

Commission, the finding that the premium agreed at the time the 2008 guarantee was granted was

not in line with the market price was in itself sufficient to support the Commission’s conclusion that

the existence of State aid could not be ruled out under the Guarantee Notice.

In the light of those clarifications, the General Court examines whether the Commission was entitled

to call into question, in the decision at issue, whether that premium was in line with the market price,

while ascertaining whether the Greek authorities were or should have been aware of Larko’s alleged

financial difficulties by the date on which the guarantee in question was granted.

In that regard, the General Court finds that the Commission possessed sufficiently reliable and

coherent evidence to show that the Greek authorities were aware of Larko’s difficult financial

situation at the time the 2008 guarantee was granted. In its opening decision, the Commission had

already established a link between Larko’s significant financial difficulties and its ‘high debt to equity

ratio’. Furthermore, it had drawn the attention of the Greek authorities to the fact that a guarantee

premium of 1% intended to remunerate a guarantee covering 100% of the guaranteed loan was

potentially not in line with market conditions. In that connection, the General Court states, in

particular, that the Greek authorities, which had themselves acknowledged that there had been a

sharp deterioration in Larko’s financial situation during the second half of 2008, had not been able to

substantiate their statement that, in 2008, Larko had a good credit rating.

In that context, the General Court states that the rules on the allocation of the burden of proof in the

application of the private operator principle, as recalled by the Court of Justice in its judgment on

appeal, cannot invalidate that conclusion, as otherwise the burden of proof would be unduly reversed

to the detriment of the Commission and the scope of the Member State’s duty to cooperate in good

faith would be disregarded, by taking into account the separation of the spheres of knowledge and

responsibility which give rise to the requirements to provide relevant information, in particular under

the Guarantee Notice.

Even though, by such a notice that is not legally binding on the Member States, the Commission

cannot reverse, to the latter’s detriment, the burden of proof of the existence of State aid, the fact

remains that it may make clear, in such a notice, the relevant information, in particular of an

economic nature, which may rule out sufficiently the presence of State aid and which the Member

State is generally in a position to provide on the ground that such information falls within its sphere of

knowledge and responsibility.

Consequently, since it is clear from the case file that the Greek authorities had not provided such

information and that the Commission had based its finding on specific evidence, the General Court

concludes that, at the time the decision at issue was adopted, the Commission possessed sufficient

reliable and coherent evidence to consider that the guarantee premium was not in line with a market

price and therefore that the guarantee constituted an advantage for the purposes of Article 107(1)

TFEU.

In the light of those considerations, the General Court dismisses the action, while considering it

unnecessary to rule on whether Larko was ‘a firm in difficulty’ at the time the guarantee was granted.

Judgment of the General Court (First Chamber), 7 September 2022, JCDecaux Street

Furniture Belgium v Commission, T-642/19