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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Aker Warnow Werft & Kvaerner v Commission (State aid) [2009] EUECJ T-68/05 (10 March 2009) URL: https://www.bailii.org/eu/cases/EUECJ/2009/T6805.html Cite as: [2009] EUECJ T-68/05, [2009] EUECJ T-68/5 |
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(State aid Shipbuilding Former German Democratic Republic Aid paid to cover losses from shipbuilding contracts Competition aid No excess payment)
In Case T-68/05,
Aker Warnow Werft GmbH, established in Rostock (Germany),
Kvaerner ASA, established in Oslo (Norway),
represented by M. Schütte, lawyer, and B. Immenkamp, Solicitor, and then by M. Schütte,
applicants,
Commission of the European Communities, represented by L. Flynn and V. Kreuschitz, acting as Agents,
defendant,
APPLICATION for annulment of Commission Decision 2005/374/EC of 20 October 2004 on a State aid measure implemented by Germany for Kvaerner Warnow Werft (OJ 2005 L 120, p. 21),
composed of V. Tiili (Rapporteur), President, F. Dehousse and I. Wiszniewska-Białecka, Judges,
Registrar: K. Pocheć, Administrator,
having regard to the written procedure and further to the hearing on 11 March 2008,
gives the following
Legal context and the facts giving rise to the dispute
'With the exception of Article 4(6) and (7), Chapter II [on operating aid] shall not apply to the shipbuilding and ship conversion activities of [shipyards] operating in the territories of the former German Democratic Republic on 1 July 1990.
2. Until 31 December 1993, operating aid for the shipbuilding and ship conversion activities of the yards referred to in paragraph 1 may be considered compatible with the common market provided that:
(a) aid to facilitate the continued operation of the yards during that period does not, for any of these yards, exceed a maximum ceiling of 36% of a reference annual turnover calculated on the basis of three years of shipbuilding and ship conversion activities after restructuring; this aid must be paid by 31 December 1993;
(b) no further production aid is granted on contracts signed between 1 July 1990 and 31 December 1993;
(c) [The Federal Republic of Germany] agrees to carry out, according to a timetable approved by the Commission and in any case before 31 December 1995, a genuine and irreversible reduction of capacity of 40% net of the capacity of 545 000 [compensated gross tonnes] existing on 1 July 1990;
(d) [The Federal Republic of Germany] provides evidence to the Commission, in the form of annual reports by an independent chartered accountant, that aid payments are strictly limited to the activities of yards situated in the former German Democratic Republic; the first such report must be submitted to the Commission at the latest by the end of February 1993.
3. The Commission shall ensure that the aid referred to in this Article does not affect trading conditions to an extent contrary to the common interest.'
'On 20 July 1992, the Council adopted Directive [92/68] amending Directive [90/84] on aid to shipbuilding. The new directive [92/68] provides for an exception to the operating aid rules in favour of shipyards in the former [German Democratic Republic] to enable them to carry out an urgent and comprehensive restructuring, so that they may become competitive again.
In relation to the privatisation of [the Warnow Werft shipyard], the Commission has received from the German Government the definitive version of [the acquisition agreement], together with explanatory notes. At a meeting on 2 February 1993, the German authorities provided further details. The Commission has thus received the necessary information to decide whether the conditions are met for a special arrangement under Directive [92/68] in the case of [the Warnow Werft shipyard] ...
When the Commission approved that special arrangement, it assured the Council that it would use its powers of review and supervision to ensure that the shipyards [situated on the territory of the former German Democratic Republic] receive only that aid strictly necessary for restructuring.
...
The Commission has decided not to raise any objections, under the provisions of Directive [90/684] on shipbuilding and Directive [92/68], to the payment of the first instalment of aid [for the Warnow Werft shipyard] in Germany. That instalment consists of:
DEM 45 500 000 operating aid, DEM 11 700 000 compensation for part of the losses from [shipbuilding] contracts entered into after 1 July 1990, which are currently being worked on, DEM 6 100 000 competition aid and a DEM 27 750 000 equity capital injection.
...'
'On the basis of the current commitments given by the German Government [in relation to the production capacity of the Warnow Werft shipyard], the Commission has decided, under ... Directive [90/684] on aid to shipbuilding and Directive [92/68] amending Directive [90/684], not to raise objections to a second instalment for [the Warnow Werft shipyard] in Germany. That instalment consists of:
DEM 617 100 000 operating aid, of which DEM 113 500 000 will be paid in cash, of which DEM 66 900 000 will be competition aid and of which DEM 46 600 000 will be to cover part of the losses on [shipbuilding] contracts signed after 1 July 1990. This operating aid is the highest amount of operating aid that the [Warnow Werft] shipyard can receive for contracts signed by 31 December 1993.
...'
'Article 1
State aid granted by [the Federal Republic of] Germany for the benefit of [KWW] ... amounting to EUR 13 293 077 (DEM 25 999 000) is incompatible with the common market.
Article 2
1. [The Federal Republic of] Germany shall take all necessary measures to recover from [KWW] the aid referred to in Article 1, which was unlawfully available to [KWW].
...'
Procedure and forms of order sought
annul the contested decision;
order the Commission to pay the costs.
dismiss the action as unfounded;
order the applicants to pay the costs.
Substance
The second part of the second plea, alleging a manifest error of assessment in the calculation of the aid received which could be taken into consideration in the contested decision
Arguments of the parties
Findings of the Court
DEM 450 000 000 to cover contract losses;
DEM 62 500 000 in respect of compensation for the fact that KWW did not receive competition aid.
Costs
On those grounds,
hereby:
1. Annuls Commission Decision 2005/374/EC of 20 October 2004 on a State aid measure implemented by Germany for Kvaerner Warnow Werft;
2. Orders the Commission to bear its own costs and pay those incurred by Aker Warnow Werft GmbH and Kvaerner ASA.
[Signatures]
* Language of the case: English.