Brussels, 02/05/2013 (Agence Europe) - On Thursday 2 May, the European Commission reopened an inquiry into certain tax measures for Electricité de France (EDF) related to the electricity grid. The aid of around €1.2 billion dates back to 1997. The European Court of Justice issued a ruling in June 2012 stating that the Commission should have checked whether a prudent private investor would have acted in the same way as the French authorities. The Commission has therefore re-opened the investigation to look into exactly that.
In 1997, when EDF's balance sheet was restructured, the French authorities reclassified part of these provisions as a capital contribution without subjecting them to corporation tax, but the Commission said that not having to pay corporation tax gave EDF a competitive advantage and therefore amounted to state aid that was illegal under the EU competition rules. France then required EDF to repay the aid in 2003 (estimated at around €900 million) along with interest. EDF repaid some €1.2 billion, but the European Union General Court, to which EDF appealed, annulled the Commission's decision in 2009 on the grounds that its investigation had not looked at whether a private investor would have acted the same way as the French state. France therefore handed back the €1.2 billion to EDF and in June 2012, the European Court of Justice confirmed the General Court's ruling. The Commission could have accepted the outcome, but decided to re-open the investigation but this time to examine what a private investor would have done. (LC/transl.fl)