Brussels, 13/05/2014 (Agence Europe) - On Tuesday 13 May, the Court of Justice of the European Union ordered Spain to pay a fixed amount of €30 million for failing in its obligation to execute a judgment establishing a breach of obligations issued by the Court in 2006.
In the 1990s, Alava, Vizcaya and Guipuzcoa, three provinces of the Basque country, granted state aid to a number of businesses in the form of a reduction of their tax base and tax credit of 45% of investments. In six decisions returned in July 2001 the Commission found this aid incompatible with the single market and ordered Spain to cease these regimes and to ensure that the aid already paid out to the beneficiaries was recovered. In 2003, as all of the aid had not been recovered, the Commission brought infringement actions before the Court of Justice, which ruled in the Commission's favour in December 2006.
In 2011, the Commission again brought infringement proceedings, arguing that Spain had not fully executed the ruling of 2006. It put the unrecovered monies at 87% of the total illegal aid at the time the proceedings were brought. The Commission subsequently noted that Spain had fully executed the 2006 decision during the proceedings before the Court and abandoned its request for a fine to be imposed, but kept in place its request for the country to be ordered to pay an amount of money which, it argued, should be set at €65 million.
The Court now takes note of the fact that as of 27 August 2008 (the deadline set by the Commission in a reasoned opinion), Spain had not fully recovered the legal aid. The Court notes that the aid recovery procedure had continued for more than five years after the 2006 ruling, which is disproportionate to the problems related to recovering this aid. The aid, moreover, is particularly harmful to competition, due to its level and the high number of beneficiaries and should therefore have been recovered quickly. Lastly, given the fact that Spain has already been handed down several judgments establishing a breach of obligations for its failure immediately and effectively to recover the legal aid, the adoption of a deterrent measure such as an order to pay a fixed sum is justified. (EL)