Luxemburg, 26/01/2006 (Agence Europe) - The European Court of First Instance, in its Stadtwerke Schwäbisch opinion, has found that the German tax scheme allowing tax exemption for the reserves set up by nuclear power stations did not amount to State aid. The European Commission did not, therefore, wrongly assess that tax scheme, said a Court press release, which said that nuclear power stations in Germany are obliged by law to set up reserves to cover, first, the costs of disposing of their irradiated fuel and their radioactive waste and, second, the permanent closure of their plants. These reserves can be counted among the liabilities of the undertaking concerned and lead to a reduction of the corresponding amount from the taxable total. In 1999, three German electricity production and distribution competitor utilities - Stadtwerke Schwäbisch Hall, Stadtwerke Türbingen and Stadtwerke Uelzen - public electricity utilities claimed that the tax exemption amounted to State aid to nuclear power stations. Following a summary examination, the Commission decided that the tax measure at issue did not amount to aid of such a nature.
The three public utilities contested the Commission's decision before the Court of First Instance, which noted that the “tax exemption amounts to an economic advantage granted through State resources in so far as the State waives its right tot levy a certain amount of tax revenue”. Nonetheless, the Court considered that neither the tax exemption scheme for the reserves nor the detailed rules for the implementation by the authorities of the tax scheme in dispute granted to nuclear power stations a specific advantage inherent in the notion of State aid. In addition, said the press release, the public utilities did not establish that the amount of those reserves was to be regarded as disproportionate in the light of the scale of the expenditure that nuclear power stations necessarily incur in order to finance their public law obligation to dispose of their radioactive waste and to decommission their plants. In these conditions, the Commission was correct in its judgment and is not required to initiate the formal procedure for detailed investigation of State aid, concluded the Court.