Trajektna luka Split v Commission (Judgment) [2016] EUECJ T-57/15 (14 September 2016)

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(State aid — Port services — Alleged aid to the public ferry operator of Jadrolinija — Setting of fees by the Croatian authorities for port services in the Port of Split in respect of domestic traffic at an allegedly lower level than that of the fees applied in other Croatian ports and those applied for international traffic — Private operator holding an allegedly exclusive concession for the operation of the passenger terminal at the Port of Split — Decision finding no State aid — Definition of aid — State resources)

Trajektna luka Split d.d., established in Split (Croatia), represented by M. Bauer, H.-J. Freund and S. Hankiewicz, lawyers,

European Commission, represented by A. Bouchagiar and P.-J. Loewenthal, acting as Agents,

APPLICATION pursuant to Article 263 TFEU for the annulment of Commission Decision C(2013) 7285 final of 15 October 2014 on State Aid SA.37265 (2014/NN) — Croatia — Alleged aid to Jadrolinija,

composed of M. van der Woude, President, I. Wiszniewska-Białecka and I. Ulloa Rubio (Rapporteur), Judges,

1 The applicant, Trajektna luka Split d.d, is the private operator of the passenger terminal at the Port of Split in Croatia. The company was privatised in 2003. Its core activities concern passenger terminal operations in domestic and international traffic including the mooring and unmooring of ships and the embarkation and disembarkation of passengers and vehicles.

2 The port of Split is the largest passenger port in Croatia. It is managed by the Split Port Authority.

3 On 22 August 2013, the applicant filed a complaint with the European Commission alleging that the Split Port Authority was providing unlawful State aid to the public ferry operator Jadrolinija.

4 According to that complaint, in 2003 the Split Port Authority granted the applicant an exclusive concession authorising it to supply port services for a period of 12 years.

5 In 2005, according to the complainant, that port authority also limited the fees for port services in respect of domestic traffic to a level that is at least 40% lower than that of the fees applied in other Croatian ports. In addition, according to the complaint, the maximum fees for port services for international traffic set by the Split Port Authority are significantly higher than those for domestic traffic. According to the estimates provided in the complaint, the fees for domestic traffic are, for the most part, between 45% and 70% lower than those charged for international traffic.

6 Consequently, considering that the provision of port services in connection with domestic traffic constitutes approximately 80% of the applicant’s business, it is forced to run its business at a loss.

7 The complaint also states that 90% of domestic traffic in the Port of Split is operated by the Croatian State-owned ferry operator, Jadrolinija. The port fees for domestic traffic services in the port of Split are significantly lower than those charged in other Croatian ports. Consequently, Jadrolinija receives an advantage corresponding to the difference between the fees applicable for the services provided in connection with domestic traffic in other Croatian ports and the fees charged by the Split Port Authority for the services provided in connection with domestic traffic in the Port of Split. According to the applicant’s estimate, the aid thus received by Jadrolinija is approximately EUR 4 000 000 per year.

8 On 4 October 2013, the Commission sent a preliminary assessment letter to the applicant stating that, on the basis of a prima facie examination, the measure did not involve the transfer of state resources and therefore did not constitute State aid under Article 107 TFEU.

9 On 4 November 2013, the applicant submitted its comments on the Commission’s preliminary assessment letter.

10 On 18 December 2013, the Commission sent a copy of the complaint to the Croatian authorities together with a request for additional information.

12 On 15 October 2014, the Commission issued Decision C(2013) 7285 final on State aid SA.37265 (2014/NN) — Croatia — Alleged aid to Jadrolinija (summarised in OJ 2015 C 44, p. 1 (‘the contested decision’).

13 In recital 44 of the contested decision, the Commission stated that in accordance, inter alia, with the judgment of 13 March 2001, PreussenElektra (C‑379/98, EU:C:2001:160), a system that leads to financial redistribution from one private entity to another without any further involvement of the State does not involve a transfer of State resources, if the money flows directly from one private entity to another, without passing through a public or private body designated by the State to administer the transfer.

14 In recital 45 of the contested decision, the Commission stated that, in the present case, the financial resources flowed directly between the applicant, a 100% privately owned undertaking and its customers who would otherwise (without the maximum limit for the port fees) have been charged higher prices. Therefore, the financial resources flowed directly from one private entity to another, without passing through a public or private body designated by the State authorities to administer the transfer.

15 In recital 46 of the contested decision, the Commission concluded that the measure concerned did not involve the transfer of State resources within the meaning of Article 107(1) TFEU.

16 Lastly, in recital 47 of the contested decision, the Commission stated that that conclusion is not affected by the fact that the applicant enjoyed de facto exclusive rights within the meaning of Article 106(1) TFEU. Undertakings to which Member States have granted exclusive rights cannot, for that reason alone, be regarded as sufficiently under the control of the State for their private resources to automatically become State resources. In addition, the mere fact that a private undertaking enjoys exclusive rights cannot give rise to a risk of circumvention of the rules on State aid. In principle, market forces require private undertakings to conduct their business in a viable way, failing which they may be forced out of the market. In the present case, the applicant, like any private operator, evaluates the commercial risks and the available profit opportunities on the market and acts accordingly. The Croatian authorities could not have used the mere grant of exclusive rights as a tool to circumvent the rules of State Aid by forcing a private concession holder to pay port fees at a level that is not viable for private undertakings since, in that case, no private undertaking (not itself in receipt of State aid) would ever be inclined to conclude such a concession contract in the next call for tenders.

17 By application lodged at the Court Registry on 4 February 2015, the applicant brought the present action.

18 In accordance with Article 106(3) of the Court’s Rules of Procedure, where no request for a hearing has been submitted by the main parties within three weeks after service of notification of the close of the written part of the procedure, the General Court may decide to rule on the action without an oral part of the procedure. In the present case, the Court considers that it has sufficient information available to it from the material in the file and has decided, in the absence of such a request, to give a decision on the action without taking further steps in the proceedings.

– refer the case back to the Commission for further investigation and a new decision;

– declare the action inadmissible or, in the alternative, declare the first, second, third, fourth and sixth pleas in law inadmissible and reject the fifth plea in law as unfounded or, in the further alternative, dismiss the action as unfounded;

21 In support of its action, the applicant puts forward six pleas in law alleging: (i) a manifest error of assessment and error of law in that the Commission applied the wrong test to establish whether State resources were involved within the meaning of Article 107 TFEU; (ii) a manifest error of assessment and error of law in that the Commission found that State resources, within the meaning of Article 107 TFEU, were not involved; (iii) a manifest error of law in that the Commission failed to consider Article 106(1) TFEU, read in conjunction with Article 107(1) TFEU; (iv) infringement of essential procedural requirements in that the Commission did not make sufficient use of its investigative powers as regards the Member State pursuant to Article 10(2) of Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article [108 TFEU] (OJ 1999 L 83, p. 1); (v) failure to open the formal investigation procedure provided for in Article 108(2) TFEU; and (vi) failure to state sufficient reasons both with regard to the finding that State resources were not involved and with regard to the combined provisions of Article 106(1) TFEU and Article 107(1) TFEU.

22 It is appropriate to examine together the first and second pleas in law concerning the claim that State resources were involved.

The first and second pleas in law, alleging a manifest error of assessment and a manifest error of law in the assessment as to whether State resources were involved

23 As a preliminary point, it should be recalled that only advantages granted directly or indirectly through State resources are to be regarded as aid within the meaning of Article 107(1) TFEU. The distinction made in that provision between ‘aid granted by a Member State’ and aid granted ‘through State resources’ does not signify that all advantages granted by a State, whether financed through State resources or not, constitute aid, but is intended merely to bring within that definition both advantages which are granted directly by the State and those granted by a public or private body designated or established by the State (see judgment of 15 January 2013, Aiscat v Commission, T‑182/10, EU:T:2013:9, paragraph 103 and the case-law cited).

24 It should also be borne in mind that Article 107(1) TFEU covers all the financial means by which the public authorities may actually support undertakings, irrespective of whether or not those means are permanent assets of the State. Consequently, even though the sums involved in the measure at issue are not permanently held by the public authorities, the fact that they remain constantly under public control, and therefore available to the competent national authorities, is sufficient for them to be categorised as State aid (see judgment of 15 January 2013, Aiscat v Commission, T‑182/10, EU:T:2013:9, paragraph 104 and the case-law cited).

25 The applicant maintains that the Commission simply took the view that the mere fact that, in the present case, financial resources were directly transferred between the applicant, which is wholly privately owned, and its customers was sufficient for a conclusion to be reached that the measure covered by the complaint did not involve a transfer of State resources within the meaning of Article 107(1) TFEU. In doing so, the Commission referred only to the judgment of 13 March 2001, PreussenElektra (C‑379/98, EU:C:2001:160) and the judgment of 15 January 2013, Aiscat v Commission (T‑182/10, EU:T:2013:9). According to the applicant, State aid may also exist in situations where the financial contribution stems from private resources as long as those resources are under sufficient State control, in accordance with the Court’s approach, inter alia, in its judgment of 30 May 2013, Doux Élevage and Coopérative agricole UKL-ARREE (C‑677/11, EU:C:2013:348, paragraph 35). The Commission has already applied those principles in a number of its decisions such as Commission Decision (EU) 2015/1585 of 25 November 2014 on the aid scheme SA.33995 (2013/C) (ex 2013/NN) (implemented by Germany for the support of renewable electricity and of energy-intensive users) (OJ 2015 L 250, p. 122).

26 In the present case, the measure in question concerns fees for port services which, in accordance with Articles 62 and 63 of the Croatian Maritime Domain and Seaports Act (‘the Maritime Domain Act’), although fixed by the Split Port Authority, are paid directly to the applicant by the users of those services whether they are in the private sector or the public sector, as in the case of Jadrolinija.

27 In recitals 44 to 46 of the contested decision, the Commission stated that, as the financial resources in question flow directly between the applicant, which is 100% privately-owned, and its customers, those resources flow directly from one private entity to another without passing through a public or private body designated by the State and it concluded that the measure concerned does not therefore involve a transfer of State resources (see paragraphs 13 to 15 above).

28 Accordingly, it suffices to note that the Commission applied, by analogy, the approach adopted in the judgment of 13 March 2001, PreussenElektra (C‑379/98, EU:C:2001:160, paragraphs 59 to 62). In that judgment, the Court of Justice stated that the obligation imposed on private undertakings to purchase a certain type of electricity at minimum prices set by a Member State did not involve any direct or indirect transfer of State resources to undertakings which produce that type of electricity. Therefore, the allocation of the financial burden arising from that obligation for those private electricity supply undertakings as between themselves and other private undertakings could not constitute a direct or indirect transfer of State resources either. The Court, therefore, took the view that the fact that the purchase obligation was imposed by statute and conferred an undeniable advantage on certain undertakings was not capable of conferring upon it the character of State aid within the meaning of Article 107(1) TFEU. According to the Court, that conclusion cannot be undermined by the fact that the financial burden arising from the obligation to purchase at minimum prices is likely to have negative repercussions on the economic results of the undertakings subject to that obligation and therefore entail a diminution in tax receipts for the State. That consequence is an inherent feature of such a legislative provision and cannot be regarded as constituting a means of granting to producers of that type of electricity a particular advantage at the expense of the State.

29 Such an approach has, moreover, been upheld by the General Court in its judgment of 15 January 2013, Aiscat v Commission (T‑182/10, EU:T:2013:9, paragraph 105), according to which the sums corresponding to the result of the increase of the toll for a first motorway set by the State authorities with a view to financing the repayment of the construction costs of a second motorway, paid directly to the concession holder for that second motorway, a private company, by the concession holders for the first motorway, also private companies, thus transferring directly and exclusively between private companies without any public body thereby acquiring, if only transiently, possession or control, do not constitute State resources within the meaning of the case-law.

30 The Commission was therefore right to conclude, in paragraph 46 of the contested decision (see paragraph 15 above), that the measure at issue did not involve the transfer of State resources within the meaning of Article 107(1) TFEU.

32 First, the applicant maintains that the contested decision is not consistent with case-law and observes, inter alia, that the Court of Justice, in the judgment of 30 May 2013, Doux Élevage and Coopérative agricole UKL-ARREE (C‑677/11, EU:C:2013:348), stated, in paragraph 35 of that judgment, that even if the sums corresponding to the measure in question are not permanently held by the competent national authorities, the fact that they constantly remain under public control, and therefore available to those authorities, was sufficient for them to be categorised as State aid. The applicant concludes from this that it is not necessary that the funds ever pass through the hands of public entities for them to be classified as State aid. According to the applicant, the determining factor is that of control by the Member State in question of the measure concerned. The applicant maintains that it does not have its own resources at its disposal given that it cannot set the exact amount for its services as the range of those services is established in advance by the Maritime Domain Act.

33 In that regard, it should be noted that, while the Court referred, in paragraph 35 of the judgment of 30 May 2013, Doux Élevage and Coopérative agricole UKL-ARREE (C‑677/11, EU:C:2013:348), to its own case-law according to which sums which are not permanently held by the competent national authorities fall within the classification of State aid because they constantly remain under public control and therefore available to those authorities, it nonetheless concluded at paragraph 36 of that judgment, contrary to the impression given by the applicant, that those conditions were not met in the case giving rise to that judgment because the entity receiving the resources decided how they were to be used, the national authorities could not use the resources in question and they were not constantly under public control and were not therefore available to State authorities.

34 The applicant’s explanation that it does not have its own resources at its disposal because it is not free to fix either its fees or the range of its services is not convincing. If the applicant does not have that freedom, it is because it undertook to provide the services set out in the Maritime Domain Act at allegedly low fees when it concluded the concession contract for the operation of the Port of Split. The applicant cannot therefore reasonably claim that it cannot decide on the use of resources from fees fixed by the Split Port Authority or that the national authorities can use those resources or have them at its disposal in such a way that they control them within the meaning of the judgment of 30 May 2013 in Doux Élevage and Coopérative agricole UKL-ARREE (C‑677/11, EU:C:2013:348). In the present case, the issue is not one of control by the Croatian authorities of the applicant’s resources but of consideration for the concession contract which the applicant concluded.

35 Secondly, the applicant maintains that the measure at issue in the judgment of 15 January 2013, Aiscat v Commission (T‑182/10, EU:T:2013:9), which the Commission cites in its defence, was ultimately funded by the consumers using the motorway through an increase in the toll, whereas in the present case the applicant is suffering a loss which it cannot pass on to other consumers.

36 Therefore, the applicant seems to connect the existence of State aid directly with the fact that it has incurred losses. Apart from the fact that it does not explain how the existence of an alleged loss is a matter which might reveal the existence of State aid, it must be stated that the applicant has not produced any document, such as an accounting document, showing the existence of such a loss. In that regard, the documents presented by the applicant as an annex to its reply — apart from the fact that they do not show its losses but simply compare the fees in different Croatian ports — are, in any event, inadmissible as they were not produced in the application in accordance with Article 85(1) of the Rules of Procedure, and the applicant has not justified their late submission, as required under Article 85(2) of that regulation. In addition, the question whether the applicant, a private company, has incurred losses is, in any event, irrelevant in determining whether State resources have been used. Article 107 TFEU is designed to protect competition in the internal market and cannot be circumvented from that purpose in order to be used as a means of calling into question the financial conditions of a concession contract which the concession holder considers to be unfair.

37 Thirdly, the applicant maintains that Jadrolinija operates 90% of domestic traffic in the Port of Split and is, therefore, the main beneficiary of excessively low fees.

38 In any event, the situation described above is a factual situation which, moreover, has not been established by the applicant, is liable to change and does not call into question the Commission’s finding, in recital 45 of the contested decision (see paragraph 14 above), that financial resources flow directly from one private entity to another. The fact that public undertakings may also benefit from advantageous fees in the same way as private undertakings, cannot call that finding into question.

39 Fourthly and last, the applicant maintains that in the contested decision the Commission departed from a similar decision which it had recently adopted, namely Decision 2015/1585, in which the Commission explained that the relevant test for determining whether a case involves public resources, whatever their initial origin, was the public authority’s level of intervention in the identification of the measures at issue and the way in which they were financed.

40 As regards that statement, it is sufficient to observe that, in any event, according to settled case-law, it is solely in the context of Article 107(1) TFEU that the question whether a measure constitutes State aid must be assessed and not in the light of an alleged earlier decision-making practice of the Commission (judgment of 15 November 2011, Commission and Spain v Government of Gibraltar and United Kingdom, C‑106/09 P and C‑107/09 P, EU:C:2011:732, paragraph 136).

41 Therefore, the Commission was right to state, in recital 47 of the contested decision (see paragraph 16 above), that the conclusion that the setting of port fees by the Split Port Authority did not involve the transfer of State resources within the meaning of Article 107(1) TFEU was not affected by the fact that the applicant enjoyed de facto exclusive rights within the meaning of Article 106(1) TFEU.

The third plea in law, alleging a manifest error in law in that the Commission did not take into account Article 106(1) TFEU, read in conjunction with Article 107(1) TFEU

43 According to the applicant, the Commission failed to take into account the fact that it had been granted a special right within the meaning of Article 106(1) TFEU, which needs to be considered in the context of Article 107(1) TFEU. The applicant adds that, as it submitted in the administrative proceedings, in the case of undertakings which enjoy exclusive rights under Article 106(1) TFEU, since, as in the present case, the other conditions laid down in Article 107(1) TFEU are fulfilled, there is no need for State resources to be involved to reach the conclusion that there is State aid, given that the mere fact that the undertaking has been granted an exclusive right already makes measures taken by the undertaking imputable to the State where, as in the present case, those measures are imposed by State authorities. Accordingly, the applicant submits, in essence, that where an undertaking enjoys exclusive rights, it finds itself in the same situation as a public undertaking. Therefore, a combined reading of Articles 106 TFEU and 107 TFEU requires that the resources of those undertakings be treated in the same way, in the light of the objective laid down in Article 107 TFEU.

44 In the contested decision, the Commission found that undertakings to which Member States granted exclusive rights cannot, for that reason alone, be regarded as sufficiently under the control of the State for their private resources to automatically become State resources (see paragraph 16 above).

45 In that regard, it must be noted that, in support of its arguments the applicant refers, inter alia, to paragraph 63 of the judgment of 13 March 2001, PreussenElektra (C‑379/98, EU:C:2001:160).

46 However, that paragraph does not relate to the Court of Justice’s decision, as suggested by the applicant, but to the Commission’s argument that the concept of State aid must be interpreted so as to include support measures decided on by the State and financed by private undertakings.

47 The Court, however, rejected that argument and, on the contrary, held in that judgment that a statutory provision of a Member State which, first, requires private electricity supply undertakings to purchase electricity produced in their area of supply from renewable energy sources at minimum prices higher than the real economic value of that type of electricity, and, second, distributes the financial burden resulting from that obligation between those electricity supply undertakings and upstream private electricity network operators, does not constitute State aid within the meaning of Article 107(1) TFEU (judgment of 13 March 2001, PreussenElektra, C‑379/98, EU:C:2001:160, paragraphs 64 to 66; see also paragraph 28 above).

48 Likewise, it should be observed that the judgment of 15 January 2013, Aiscat v Commission (T‑182/10, EU:T:2013:9), concerned measures financed directly by private undertakings with exclusive rights, namely the concession holders for an Italian motorway. In that case, as was noted at paragraph 29 above, the General Court held that no State resources were involved and there was no State aid (judgment of 15 January 2013, Aiscat v Commission, T‑182/10, EU:T:2013:9, paragraphs 105 and 106).

49 Thus, contrary to what the applicant maintains, it cannot be inferred from the mere fact that an undertaking enjoys exclusive rights that it is in the same situation as a public undertaking.

50 The Commission was therefore right to state, in recital 47 of the contested decision (see paragraph 16 above), that the conclusion that the setting of port fees by the Split Port Authority did not involve a transfer of State resources within the meaning of Article 107(1) was not affected by the fact that the applicant enjoyed de facto exclusive rights within the meaning of Article 106(1) TFEU.

The fourth plea in law, alleging infringement of essential procedural requirements in that the Commission did not make sufficient use of its investigative powers in respect of the Member State pursuant to Article 10(2) of Regulation No 659/1999

52 In the fourth plea in law, the applicant submits that the Commission did not make sufficient use, with regard to the Member State, of its investigative powers under Article 10(2) of Regulation No 659/1999. The Commission was obliged, according to the applicant, to discuss the measures at issue with the Croatian authorities so as to ensure that all necessary information was available. That included, inter alia, information on the question whether the State had control over the funds in question for the purpose of establishing whether State resources were involved.

53 Article 10(2) of Regulation No 659/1999 provides that the Commission may request the Member State concerned to provide it with information concerning the allegedly unlawful aid.

54 Then, if the Member State, despite a reminder, does not provide the information requested within the prescribed period, the Commission, in accordance with Article 10(3) of Regulation No 659/1999, ‘shall by decision require the information to be provided’.

55 Furthermore, the Member State concerned is required, in accordance with Article 10(2) of Regulation No 659/1999 read in conjunction with Article 2(2) of that regulation, to provide the Commission with all the information necessary in order to enable it to take a decision on the classification of the measure at issue and, if appropriate, its compatibility with the internal market.

56 Accordingly, those provisions, which concern the relationship between the Commission and the Member State concerned, impose obligations on the Member State and do not require the Commission to make additional enquiries of that State where, as in the present case, that does not seem necessary, in order to find that a measure does not constitute State aid, without initiating the formal investigation procedure.

The fifth plea in law, alleging failure to initiate the formal investigation procedure under Article 108(2) TFEU

58 The applicant submits that, in adopting the contested decision following a preliminary investigation, the Commission infringed the applicant’s procedural rights under the formal investigation procedure laid down by Article 108(2) TFEU. The Commission is obliged to initiate that procedure if an initial review does not enable it objectively to overcome all the difficulties encountered when assessing whether the State measure in question is compatible with the internal market. The Commission clearly encountered serious difficulties when assessing the nature of the measures at issue, having regard, first, to the length and circumstances of the preliminary investigation stage and, secondly, the content of the contested decision in the light of the information supplied.

59 In that regard, it must be recalled that, if the Commission is unable to conclude, following an initial examination in the context of the procedure under Article 108(3) TFEU, that a measure either is not ‘aid’ within the meaning of Article 107(1) TFEU or, if classified as aid, is compatible with the FEU Treaty, or where that procedure does not enable it to overcome all the difficulties involved in determining whether the aid is compatible with the internal market, the Commission is under a duty to initiate the procedure under Article 108(2) TFEU, without having any discretion in that regard (see judgment of 22 December 2008, British Aggregates v Commission, C‑487/06 P, EU:C:2008:757, paragraph 113 and the case-law cited; see also, to that effect, judgment of 9 October 2001, Italy v Commission, C‑400/99, EU:C:2001:528, paragraph 48). That duty is, moreover, expressly confirmed by the provisions of Article 4(4) in conjunction with Article 13(1) of Regulation No 659/1999 (judgment of 22 December 2008, British Aggregates v Commission, C‑487/06 P, EU:C:2008:757, paragraph 113).

60 The notion of serious difficulties is an objective one. The existence of such difficulties must be sought both in the circumstances in which the contested measure was adopted and in its content, in an objective manner, comparing the grounds of the decision with the information available to the Commission when it took a decision on the compatibility of the disputed aid with the internal market (see judgment of 28 March 2012, Ryanair v Commission, T‑123/09, EU:T:2012:164, paragraph 77 and the case-law cited). It follows that judicial review by the General Court of the existence of serious difficulties will, by its nature, go beyond simple consideration of whether or not there has been a manifest error of assessment (judgment of 27 September 2011, 3F v Commission, T‑30/03 RENV, EU:T:2011:534, paragraph 55). A decision adopted by the Commission without initiating the formal investigation stage may be annulled on that ground alone, because of the failure to initiate the inter partes and detailed investigation required under the FEU Treaty, even if it is not established that the Commission’s assessments as to the substance are wrong in law or in fact (see, to that effect, judgment of 9 September 2010, British Aggregates and Others v Commission, T‑359/04, EU:T:2010:366, paragraph 58).

61 Although the Commission has no discretion in relation to the decision to initiate the formal investigation procedure, where it finds that such difficulties exist, it nevertheless enjoys a certain margin of discretion in identifying and evaluating the circumstances of the case in order to determine whether or not they present serious difficulties. In accordance with the objective of Article 108(3) TFEU and the Commission’s duty of good administration, the Commission may, amongst other things, engage in a dialogue with the notifying State or with third parties in an endeavour to overcome, during the preliminary procedure, any difficulties encountered (judgments of 15 March 2001, Prayon-Rupel v Commission, T‑73/98, EU:T:2001:94, paragraph 45, and 3 March 2010, Bundesverband deutscher Banken v Commission, T‑36/06, EU:T:2010:61, paragraph 126). That power presupposes that the Commission may bring its position in line with the results of the dialogue it engaged in, without that alignment having to be interpreted, a priori, as establishing the existence of serious difficulties (judgment of 12 December 2006, Asociación de Estaciones de Servicio de Madrid and Federación Catalana de Estaciones de Servicio v Commission, T‑95/03, EU:T:2006:385, paragraph 139).

62 The fact that the time spent considerably exceeded the time usually required for a preliminary investigation under Article 108(3) TFEU may, along with other factors, justify the conclusion that the Commission encountered serious difficulties of assessment necessitating the initiation of the procedure under Article 108(2) TFEU (judgments of 10 May 2000, SIC v Commission, T‑46/97, EU:T:2000:123, paragraph 102, and 10 February 2009, Deutsche Post and DHL International v Commission, T‑388/03, EU:T:2009:30, paragraph 94; see also, to that effect, judgment of 20 March 1984, Germany v Commission, 84/82, EU:C:1984:117, paragraphs 15 and 17).

63 The applicant bears the burden of proving the existence of serious difficulties and may discharge that burden of proof by reference to a body of consistent evidence, concerning, first, the circumstances and the length of the preliminary investigation procedure and, secondly, the content of the contested decision (judgment of 3 March 2010, Bundesverband deutscher Banken v Commission, T‑36/06, EU:T:2010:61, paragraph 127).

64 In the first place, the applicant points out the length of the preliminary investigation procedure. It states that it has been held that periods of 15 months and of one year, 10 months and 15 days for the preliminary investigation indicated the existence of serious difficulties bearing in mind the specific circumstances of the cases concerned (see, to that effect, judgments of 4 July 2007, Bouygues and Bouygues Télécom v Commission, T‑475/04, EU:T:2007:196, paragraphs 159 et seq., and 3 March 2010, Bundesverband deutscher Banken v Commission, T‑36/06, EU:T:2010:61, paragraphs 129 to 132).

65 In that regard, it should be noted that, according to case-law, where the disputed State measures have not been notified by the Member State concerned, the Commission is not required to carry out an initial investigation of those measures within a specified period. Whether or not the duration of the preliminary investigation procedure is reasonable must be determined in relation to the particular circumstances of each case and, especially, its context, the various procedural stages to be followed by the Commission and the complexity of the case (see judgment of 27 September 2011, 3F v Commission, T‑30/03 RENV, EU:T:2011:534, paragraphs 57 and 58 and the case-law cited).

66 Furthermore, the Commission is entitled to give differing degrees of priority to the complaints brought before it (see judgment of 4 July 2007, Bouygues and Bouygues Télécom v Commission, T‑475/04, EU:T:2007:196, paragraph 158 and the case-law cited).

67 Lastly, paragraph 48 of the Code of Best Practice for the conduct of State aid control procedures (OJ 2009 C 136, p. 13) provides that ‘within twelve months, the Commission will, therefore, in principle, endeavour to ... send an initial administrative letter to the complainant setting out its preliminary views on non-priority cases’.

68 In the present case, as the Commission received the applicant’s complaint on 22 August 2013 and gave the contested decision on 15 October 2014, the time taken by the Commission is hardly any longer than the indicative timeframe established by the Code.

69 Furthermore, it must be observed that it is apparent from the documents in the case file that, alongside its complaint in the present case concerning State aid, the applicant also lodged a complaint alleging abuses of a dominant position by the Split Port Authority under Articles 102 TFEU and 106 TFEU, which was rejected by the Commission by decision of 28 November 2014, in respect of which the applicant has submitted an application for annulment to the General Court registered under case number T‑70/15. Lastly, the applicant submitted a complaint alleging infringements of the internal market rules by Croatia concerning the Port of Split under Article 56 TFEU, which led to the launch of infringement proceedings against Croatia on 24 November 2014 concerning a possibly incorrect application of Council Regulation (EEC) No 4055/86 of 22 December 1986 applying the principle of freedom to provide services to maritime transport between Member States and between Member States and third countries (OJ 1986 L 378, p. 1, and corrigendum OJ 1987 L 93, p. 17). Consequently, during the 13 months which elapsed between the receipt of the complaint and the adoption of the contested decision, as the Commission explained, its services were required to coordinate their actions, policies and communications with the applicant and the Croatian authorities in respect of those three kinds of complaints.

70 Therefore, in the present case, a period of 13 months between the filing of the complaint and the adoption of the contested decision cannot, in itself, be sufficient evidence on the part of the applicant, upon whom the burden lies, of the existence of serious difficulties of assessment.

71 In the second place, the applicant argues that it is apparent from the content of the contested decision that the Commission experienced serious difficulties during the preliminary investigation procedure. In particular, there were inconsistencies between the information that the Commission provided during the preliminary investigation and the information appearing in the contested decision. The Commission did not explain why and to what extent it adopted the facts as presented by the Croatian authorities and not as presented by the applicant.

72 In that regard, it must be stated that the only alleged inconsistency to which the applicant specifically refers concerns recital 31 of the contested decision, which states that, according to the Croatian authorities, it is a 100% privately owned undertaking, and recital 40 of the contested decision, which gives a definition of a public undertaking and notes that the applicant is 100% privately owned. The fact remains that the applicant does not explain in what way there is a contradiction between those two recitals.

73 In the alternative, the applicant maintains that, from an objective standpoint, the Commission must have had serious difficulties in finding that no State resources were involved. The Commission must have had such difficulties in adopting the position that the State aid rules did not apply in principle to private undertakings and in not making an exception to that principle in the present case, even though the applicant was designated by the Croatian authorities to grant an advantage to its customers out of funds closely controlled by the Split Port Authority.

74 In that regard, the Commission’s finding that the State aid rules do not apply to financial resources which flow directly from one private undertaking to another without going through any public or private entity designated by the State to administer the transfer was based on the Court of Justice’s well-established case-law referred to in footnote No 13 of the contested decision, namely, inter alia, the judgment of 13 March 2001, PreussenElektra (C‑379/98, EU:C:2001:160, paragraphs 59 to 62). Given that, according to the information available to the Commission, the applicant was a 100% privately-owned undertaking, the Commission was correct to take the view in the preliminary investigation that, in accordance with the above-mentioned case-law, there were no serious difficulties requiring the initiation of the formal investigation procedure under Article 108(2) TFEU.

The sixth plea in law, alleging failure to state sufficient reasons with regard to the finding that State resources were not involved and with regard to the combined provisions of Article 106(1) TFEU and Article 107(1) TFEU

76 It should be recalled, as a preliminary point, that the statement of reasons required by Article 296 TFEU must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent court to exercise its power of review. Thus, the requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements of Article 296 TFEU must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (judgments of 2 April 1998, Commission v Sytraval and Brink’s France, C‑367/95 P, EU:C:1998:154, paragraph 63; 22 June 2004, Portugal v Commission, C‑42/01, EU:C:2004:379, paragraph 66; and 15 April 2008, Nuova Agricast, C‑390/06, EU:C:2008:224, paragraph 79).

77 Moreover, it would be inappropriate for the General Court to examine, in considering fulfilment of the obligation to state reasons, the substantive legality of the reasons relied on by the Commission to justify its decision. It follows that, in a plea based on a failure to state reasons or a lack of adequate reasons, objections and arguments which aim to challenge the merits of the contested decision are misplaced and irrelevant (judgment of 15 June 2005, Corsica Ferries France v Commission, T‑349/03, EU:T:2005:221, paragraphs 58 and 59).

78 It is in the light of those principles that it is necessary to determine whether the Commission has, in the present case, fulfilled its obligation to give reasons.

79 In the present case, concerning the question whether no State resources were involved, the applicant submits that the contested decision does not provide clear and unequivocal reasoning explaining why the relevant criteria for establishing whether State resources were involved were not fulfilled in the circumstances of the case. Furthermore, the contested decision did not provide any factual evidence or reasons to justify the claim that the Croatian authorities do not have any control over the funds benefiting Jadrolinija and other domestic ferry operators in the Port of Split, apart from the fact that the applicant’s revenue is private and not state-owned.

80 In that regard, it should be noted that, particularly in recitals 44 and 45 of the contested decision (see paragraphs 13 and 14 above), the Commission set out the reasons why it found that no State resources were involved. Furthermore, the Commission did not fail to have regard to the requirement to give reasons which was incumbent upon it, as, in the contested decision, it enabled the applicant to understand the reasons for the rejection of its complaint and the General Court to exercise its power of review. Moreover, the applicant had the opportunity, on the basis of that reasoning, to challenge the merits of the contested decision by its first and second pleas in law and the General Court the opportunity to examine those merits through its consideration of those pleas.

81 As to the argument that the contested decision did not provide evidence or reasons explaining why the Croatian authorities had no control over the funds benefiting Jadrolinija and other domestic ferry operators in the Port of Split, it is covered by the assessment of the merits of the contested decision. The argument put forward to that effect by the applicant must, therefore, be considered, in the light of the case-law referred to in paragraph 77 above, to be misplaced or irrelevant in a plea alleging infringement of the duty to state reasons.

82 Concerning the question of the inadequacy of the reasons in respect of the combined provisions of Article 106(1) TFEU and Article 107(1) TFEU it suffices to note that, in particular in recital 47 of the contested decision (see paragraph 15 above), the Commission set out the reasons why it concluded that no State resources were involved and therefore gave sufficient reasons for that decision. Moreover, the applicant was able, on the basis of that reasoning, to challenge the merits of the contested decision by its third plea in law and the Court was able to consider those merits through the consideration of that plea.

84 In the interest of procedural efficiency, it is apparent from the foregoing that the action must be dismissed in its entirety, without there being any need to give a ruling first on the admissibility of the action (judgments of 26 February 2002, Council v Boehringer, C‑23/00 P, EU:C:2002:118, paragraphs 51 and 52, and 15 June 2005, Regione autonoma della Sardegna v Commission, T‑171/02, EU:T:2005:219, paragraph 155).

85 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.

86 Since the applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the Commission.

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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Trajektna luka Split v Commission (Judgment) [2016] EUECJ T-57/15 (14 September 2016) URL: http://www.bailii.org/eu/cases/EUECJ/2016/T5715.html Cite as: EU:T:2016:470, ECLI:EU:T:2016:470, [2016] EUECJ T-57/15

Court of Justice of the European Communities (including Court of First Instance Decisions)