Brussels, 21/03/2012 (Agence Europe) - With a judgment on Wednesday 21 March (Joined Cases T-50/60 RENV and others), the General Court of the EU cancelled the 2005 Commission decision ordering the reimbursement of tax exemptions granted by France, Ireland and Italy for the production of alumina, which had been authorised by the Council. The Court ruled that the EU institutions should observe the principle that they may not alter measures which they have adopted and avoid any inconsistencies between the various provisions that they adopt, in order to comply with the principle of legal certainty.
Ireland, Italy and France had introduced - in 1983, 1993 and 1997 respectively - exemptions from the excise duty on mineral oils used for the production of alumina. On the basis of the 1992 European legislation (harmonisation of excise duty structure on mineral oils used as fuel), the Council had authorised such exemptions and extended them to take effect as of 31 December 2006. In 2005, the Commission had considered that aid granted for this by the three countries in question between 3 February 2002 and 31 December 2003 distorted competition and was incompatible with the common market, in so far as beneficiaries had not paid a duty corresponding to the minimum rate fixed by the 1992 legislation. It had called for such aid to be recovered from the recipients. The three countries had brought an action before the Court, which annulled the Commission's decision of 2005, on the grounds that the decision breached the obligation to state reasons. On appeal by the Commission, the Court of Justice annulled the judgment of the General Court in 2009 for infringement of the principle “audi alteram partem” and the rights of the defence and referred the case back to the General Court. It is on those cases that the General Court rules today. In this instance, the applicants complain that the Commission nullified the legal effects of the Council's decision which authorised the member states to apply the exemptions until 31 December 2006, and thereby infringed the principle of legal certainty.
The General Court rules in the applicants' favour, considering that the institutions must observe the principle that they may not alter measures which they have adopted and avoid inconsistencies between the various provisions that they adopt, in order to comply with legal certainty. It underlines that the notion of competition distortion must be regarded as having the same scope and the same meaning with regard to both the harmonisation of domestic fiscal legislation and state aid. Therefore, the EU institutions must assess whether there is a distortion of competition consistently, in order to decide whether or not to authorise an exemption from the harmonised excise duty. Where such distortion is found, the General Court also states that the Commission must, in this case, propose to the Council that it should not authorise the exemption, or abolish or amend it - which it failed to do - or call on the European judge to cancel the Council decision. In any event, the Commission was not entitled to classify the exemptions in issue as state aid so long as the Council's decision remained in force and had not been amended or annulled, without leading to an inconsistent implementation of the rules on the harmonisation of fiscal legislation and the rules on state aid, contrary to the principle of legal certainty. The Court therefore cancels the Commission's decision. (FG/transl.jl)