In a judgment returned on Wednesday 19 September in case C-438/16, the judges of the Court of Justice of the European Union (CJEU) overturned the judgment of the General Court of the European Union of 26 May 2016, which overturned a decision of the European Commission that an unlimited implicit guarantee granted by the French State to the Institut français du pétrole (IFP) constitutes State aid.
IFP (now IFP Énergies nouvelles) is a French public establishment which was a legal person under private law under the economic and financial control of the French government until 2006, when it took on the status of public industrial and commercial undertaking (EPIC).
In 2011, the Commission considered that this status gave IFP an unlimited public guarantee on all of its economic activities and could therefore be considered similar to State aid, as IFP derived a real and selective economic advantage from this guarantee, as its competitors do not enjoy a similar guarantee. Nonetheless, subject to certain conditions, the Commission considered that this support could be compatible with EU rules.
France and IFP then appealed for the cancellation of this decision before the General Court of the EU, which found in its favour on 26 May 2016 and overturned the contested decision. The Commission then appealed to the CJEU against the General Court's judgment.
Firstly, the Court judges considered that the Commission could assume that IFP benefited or could benefit from more advantageous financial conditions than those normally available on the financial markets due to the State guarantee alone.
They add that the institution did not have to prove the actual effects produced by the guarantee. Additionally, the presumption of the existence of an advantage cannot be overturned simply because no actual economic advantage has thus far been derived from it.
Finally, the Court considers that the General Court committed an error of law by failing to analyse the relations between IFP and its suppliers and clients to consider whether there was no presumption of the existence of an advantage.
The Court therefore overturned the judgment of the General Court and has referred the case back to it for re-examination. (Original version in French by Lucas Tripoteau)