Case C‑203/16 P
Dirk Andres
v
European Commission
(Appeal — State aid — German tax legislation concerning the possibility of carrying certain losses forward to future tax years (‘restructuring clause’) — Decision declaring the aid scheme incompatible with the internal market — Actions for annulment — Admissibility — Article 263, fourth paragraph, TFEU — Person individually concerned — Article 107 (1) TFEU — Concept of ‘State aid’ — Condition relating to selectivity — Determination of the reference framework — Legal classification of the facts)
Summary — Judgment of the Court (Second Chamber), 28 June 2018
Actions for annulment — Natural or legal persons — Measures of direct and individual concern to them — Individual concern — Conditions — Commission decision prohibiting a sectoral aid scheme — Action brought by recipients of aid granted under that scheme — Admissibility — Conditions — Attributes specific to, or circumstances differentiating the applicant from all other persons
(Arts 107 (1) TFEU and 263, fourth para., TFEU)
Appeal — Grounds — Incorrect assessment of the facts and evidence — Review by the Court of the assessment of the evidence — Possible only where the clear sense of the evidence has been distorted — Review of the legal classification given to the facts of the dispute — Included
(Art. 256 TFEU)
State aid — Concept — Selective nature of the measure — Measure conferring a tax advantage — Reference framework for determining the existence of an advantage — Criteria
(Art. 107(1) TFEU)
State aid — Concept — Grant by the public authorities of favourable tax treatment to certain undertakings — Included — Advantages resulting from a general measure applicable without distinction to all economic operators — Precluded
(Art. 107(1) TFEU)
The actual recipients of individual aid granted under an aid scheme incompatible with the internal market are individually concerned by a Commission decision declaring that scheme incompatible with the internal market and ordering its recovery; an applicant may not be regarded as individually concerned merely because it is a potential beneficiary of the scheme. However, it cannot be inferred that, where a decision declaring an aid scheme incompatible with the internal market is at issue, the only relevant criterion for the purpose of determining whether an applicant is individually concerned, within the meaning of the fourth paragraph of Article 263 TFEU, by such a decision, is whether the applicant is an actual or potential recipient of aid granted under the scheme.
That case-law, developed in the specific context of State aid, is only a particular expression of the relevant legal test for assessing individual concern within the meaning of the fourth paragraph of Article 263 TFEU, according to which an applicant is individually concerned by a decision addressed to another person where that decision affects them by reason of certain attributes which are peculiar to them, or by reason of circumstances in which they are differentiated from all other persons. Consequently, the fact that an applicant may fall within or outside the category of actual or potential recipients of individual aid granted under an aid scheme declared incompatible with the internal market is not decisive as regards determining whether the applicant is individually concerned by that decision, where it is in any event established that the applicant is otherwise affected by it by reason of certain attributes which are peculiar to it or a factual situation which differentiates it from all other persons.
(see paras 46-48)
The assessment of facts and evidence does not, save where the facts and evidence have been distorted or falsified, constitute a point of law which is subject, as such, to review by the Court of Justice on appeal. However, when the General Court has found or assessed the facts, the Court of Justice has jurisdiction under Article 256 TFEU to review the legal characterisation of those facts by the General Court and the legal conclusions inferred from them.
Thus, with respect to the assessment, in the context of an appeal, of the General Court’s findings on national law, which, in the field of State aid, constitute findings of fact, the Court of Justice has jurisdiction only to determine whether that law was distorted. By contrast, since the assessment, in the context of an appeal, of the legal classification which has been given to that national law by the General Court in the light of a provision of EU law constitutes a question of law, it falls within the jurisdiction of the Court of Justice.
(see paras 77, 78)
The assessment of the condition of selectivity of a measure requires a determination whether, under a particular legal regime, a national measure is such as to favour ‘certain undertakings or the production of certain goods’ over other undertakings which, in the light of the objective pursued by that regime, are in a comparable factual and legal situation and who accordingly suffer different treatment that can, in essence, be classified as discriminatory. Where the measure at issue is conceived as an aid scheme and not as individual aid, it is for the Commission to establish that that measure, although it confers an advantage of general application, confers the benefit of that advantage exclusively on certain undertakings or certain sectors of activity.
In order to classify a national tax measure as selective, the Commission must begin by identifying the ordinary or normal tax system applicable in the Member State concerned, and thereafter demonstrate that the tax measure at issue is a derogation from that ordinary system, in so far as it differentiates between operators who, in the light of the objective pursued by that ordinary tax system, are in a comparable factual and legal situation.
The concept of ‘State aid’ does not, however, cover measures that differentiate between undertakings which, in the light of the objective pursued by the legal regime concerned, are in a comparable factual and legal situation, and are, therefore, a priori selective, where the Member State concerned, thirdly, is able to demonstrate that that differentiation is justified since it flows from the nature or general structure of the system of which the measures form part.
The examination of the selectivity condition therefore implies, in principle, the determination, first, of the reference framework within which the measure concerned falls, that determination being of greater importance in the case of tax measures, since the very existence of an advantage may be established only when compared with ‘normal’ taxation.
Thus, determination of the set of undertakings which are in a comparable factual and legal situation depends on the prior definition of the legal regime in the light of whose objective it must, as the case may be, be examined whether the factual and legal situation of the undertakings favoured by the measure in question is comparable with that of those which are not.
However, the classification of a tax system as ‘selective’ is not conditional upon that system being designed in such a way that undertakings which might enjoy a selective advantage are, in general, subject to the same tax burden as other undertakings but benefit from derogating provisions, so that the selective advantage may be identified as being the difference between the normal tax burden and that borne by those former undertakings.
Such an interpretation of the selectivity criterion would require that in order for a tax system to be classifiable as ‘selective’ it must be designed in accordance with a certain regulatory technique; the consequence of this would be that national tax rules fall from the outset outside the scope of control of State aid on account of the sole fact that they were adopted under a different regulatory technique although, by adjusting and combining various tax rules, they produce the same effects in law and/or in fact. Therefore, the regulatory technique used cannot be decisive for the purposes of the determination of the reference framework.
It follows from the foregoing that the selectivity of a tax measure cannot be precisely assessed on the basis of a reference framework consisting of some provisions that have been artificially taken from a broader legislative framework.
(see paras 83, 84, 86-92, 103, 104)
See the text of the decision.
(see para. 85)