NON CONFIDENTIAL VERSION
JUDGMENT OF THE GENERAL COURT (Eighth Chamber)
7 October 2010 (*)
(State aid – Air freight – Warranties relating to the operation of DHL’s new European hub at Leipzig-Halle Airport – Decision declaring the aid incompatible with the common market and ordering its recovery)
In Case T‑452/08,
DHL Aviation SA/NV, established in Zaventem (Belgium),
DHL Hub Leipzig GmbH, established in Schkeuditz (Germany),
represented by A. Burnside, Solicitor, and B. van de Walle de Ghelcke, of the Brussels Bar,
applicants,
v
European Commission, represented by K. Gross, B. Martenczuk and E. Righini, acting as Agents,
defendant,
APPLICATION for the partial annulment of Commission Decision 2008/948/EC of 23 July 2008 on measures by Germany to assist DHL and Leipzig-Halle Airport (OJ 2008 L 346, p. 1),
THE GENERAL COURT (Eighth Chamber),
composed of M.E. Martins Ribeiro, S. Papasavvas (Rapporteur) and A. Dittrich, Judges,
Registrar: K. Pocheć, Administrator,
having regard to the written procedure and further to the hearing on 7 May 2010,
gives the following
Judgment
Background to the dispute
1 The applicants – DHL Aviation SA/NV and DHL Hub Leipzig GmbH – belong to the DHL Group (‘DHL’). DHL is one of the main groups operating in the express parcels sector. It is wholly owned by Deutsche Post AG.
2 After negotiating with a number of airports, DHL decided in 2005 to transfer its European air freight hub from Brussels (Belgium) to Leipzig-Halle (Germany) with effect from 2008.
3 Leipzig-Halle Airport is operated by Flughafen Leipzig-Halle GmbH (‘FLH’), a subsidiary of Mitteldeutsche Flughafen AG (‘MF’). MF holds 94% of the shares in FLH. The remaining shares in FLH are held by Land Sachsen (5.5%), Landkreis Nordsachsen (0.25%) and the town of Schkeuditz (0.25%). The shares in MF are held by Land Sachsen (76.64%) and Land Sachsen-Anhalt (18.54%), and the cities of Dresden (2.52%), Halle (0.2%) and Leipzig (2.1%). MF does not have any private sector shareholders.
4 On 4 November 2004, MF decided to build a new southern runway for takeoff and landing (‘the southern runway’). It was to be financed by capital contributions of EUR 350 million, to be provided to MF or FLH by their public sector shareholders (‘the capital contributions’).
5 On 21 September 2005, FLH, MF and DHL Hub Leipzig signed a framework agreement (‘the framework agreement’). Under the framework agreement, FLH is required to build the southern runway and to honour other commitments for the duration of the agreement. These include in particular a commitment to provide unrestricted air access on the southern runway 24 hours a day and 7 days a week (‘the Nightflight Clause’) and to ensure that at least 90% of all movements of air carriers operating for, or on behalf of, DHL can take place on that runway at any time (‘the 90% Clause’). The framework agreement sets out the conditions which FLH and MF guarantee to fulfil in respect of initiating the building works and launching the new hub, as well as in respect of its subsequent operation. It also includes agreements on the terms of operation, the airport taxes and the leasing of land. As regards the conditions applying subsequent to the launching of the new hub, the framework agreement provides that if, after the start of operations, FLH were to fail to comply with the terms of operation laid down in that agreement, FLH and MF would be liable to pay DHL Hub Leipzig compensation for any damage or loss that it might suffer. In the event of its operations being significantly restricted, DHL Hub Leipzig would also have the right to terminate the framework agreement and claim compensation for all the direct and indirect costs of moving to an alternative airport. If DHL Hub Leipzig had to relocate to another airport following a ban by the regulatory authorities on night flights, FLH would thus be liable to pay it up to EUR [confidential]. (1)
6 On 21 December 2005, Land Sachsen issued a comfort letter in favour of FLH and DHL Hub Leipzig (‘the comfort letter’). The purpose of that letter was to guarantee FLH’s financial viability for the duration of the framework agreement and it committed Land Sachsen to pay damages of EUR [confidential] to DHL Hub Leipzig in the event that Leipzig-Halle Airport would no longer be able to operate as foreseen in the agreement.
7 On 5 April 2006, in accordance with Article 2(1) of Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article [88 EC] (OJ 1999 L 83, p.1), the Federal Republic of Germany notified the framework agreement and the comfort letter to the Commission of the European Communities.
8 On 27 April 2006, the Commission requested further information, which the German authorities forwarded to it on 24 July 2006.
9 Meetings took place between the Commission, FLH, MF, DHL and the German authorities on 26 July and 21 August 2006.
10 By letter of 23 November 2006, the Commission informed the Federal Republic of Germany of its decision to initiate the procedure provided for in Article 88(2) EC. That procedure related to the framework agreement, the comfort letter and the capital contributions. The decision and the invitation to interested parties to submit their comments on the proposed aid were published in the Official Journal of the European Union of 2 March 2007 (OJ 2007 C 48, p. 7).
11 The Federal Republic of Germany submitted its observations on 23 February 2007. The Commission received comments from interested parties, which it forwarded by letter of 16 May 2007 to the German authorities, giving them the opportunity to respond within one month. The Commission received the German authorities’ comments by letter of 13 June 2007.
12 At the request of the Federal Republic of Germany, meetings were held on 18 June and 25 September 2007. Following those meetings, the German authorities sent additional information to the Commission on 19 October and 7 and 18 December 2007 and on 17 March and 9 April 2008.
Decision
13 On 23 July 2008, the Commission adopted Decision 2008/948/EC on measures by Germany to assist DHL and Leipzig-Halle Airport (OJ 2008 L 346, p. 1; ‘the Decision’).
14 As regards the capital contributions, the Commission held in the Decision that the EUR 350 million in State aid which the Federal Republic of Germany was planning to grant FLH for the construction of the southern runway and related airport infrastructure was compatible with the common market under Article 87(3)(c) EC.
15 As regards the framework agreement and the comfort letter, the Commission held that the unlimited warranties contained in the agreement, on the one hand, and the comfort letter, on the other, constituted State aid within the meaning of Article 87(1) EC, since Land Sachsen, MF and FLH hedged business risks for DHL on terms to which a private investor operating in normal conditions of a market economy would not have agreed. As DHL had already benefited from the maximum amount of investment aid permissible under Article 87(3)(a) EC, the Commission took the view that the unlimited warranties contained in the framework agreement and the comfort letter were incompatible with the common market.
16 The enacting terms of the Decision provide:
‘Article 1
The State aid which [the Federal Republic of] Germany is planning to implement amounting to EUR 350 million in relation to the construction of a new runway and related airport infrastructure at Leipzig-Halle Airport is compatible with the common market under Article 87(3)(c) [EC].
Article 2
The State aid which [the Federal Republic of] Germany is planning to implement by granting the comfort letter in favour of DHL is incompatible with the common market. The aid may accordingly not be implemented.
Article 3
The State aid which [the Federal Republic of] Germany granted to DHL in the form of unlimited warranties (according to sections 8 and 9 of the Framework Agreement) is incompatible with the common market. These unlimited warranties granted by the Framework Agreement must accordingly be abolished.
Article 4
1. [The Federal Republic of] Germany shall recover the part of the aid referred to in Article 3 which has already been put at the disposal of DHL (i.e. the warranty fee for the period from 1 October 2007 until the abolition of the unlimited warranties).
2. The sums to be recovered shall bear interest from the date on which they were put at the disposal of the beneficiary until their actual recovery.
…’
Facts subsequent to the adoption of the Decision
17 The parties informed the Court at the hearing that they had entered into an agreement concerning implementation of the Decision. They explained in particular that the framework agreement had been amended by means of a notarial act dated 10 July 2009; that the amount to be recovered under Article 4 of the Decision had been calculated to be EUR 1 081 439; and that that amount had been placed in a blocked account pending the outcome of the present action.
Procedure and forms of order sought
18 By application lodged at the Court Registry on 6 October 2008, the applicants brought the present action.
19 The applicants claim that the Court should:
– annul the Decision in so far as it identifies them as beneficiaries of State aid considered to be incompatible with the common market, and in so far as the Decision orders the Federal Republic of Germany to recover that alleged State aid;
– order the Commission to pay the costs.
20 The Commission contends that the Court should:
– dismiss the action as partially inadmissible and partially unfounded;
– order the applicants to pay the costs.
21 After the conclusion of the written procedure, the applicants informed the Court, by letter of 19 November 2009, that they were confining their action to the second ground of the fourth plea in law raised in their application and were accordingly withdrawing the first, second, third and fifth pleas in law and the first and third grounds of the fourth plea in law. The Court took formal note of this. They also asked the Court to make an appropriate order as to costs.
22 The Commission submitted its observations on the partial withdrawal on 10 December 2009 and contended that the Court should dismiss the action as inadmissible and order the applicants to pay the costs.
23 At the hearing, the Commission withdrew its plea of inadmissibility in respect of the ground of the fourth plea in law remaining following withdrawal. The Court took formal note of this.
Law
Admissibility of the action in so far as it concerns DHL Aviation
Arguments of the parties
24 The Commission contends that the action is inadmissible in so far as it was brought by DHL Aviation. It states that only DHL Hub Leipzig can be regarded as a beneficiary of the framework agreement and as deriving rights from the comfort letter. Consequently, only DHL Hub Leipzig is directly and individually concerned by the Decision. Moreover, the applicants have failed to explain why DHL Aviation should be regarded as directly and individually concerned by the Decision or why it should be regarded as having an interest in the annulment of the Decision. In that regard, the Commission maintains on the basis of existing case-law that the fact that DHL Aviation participated in the formal investigation procedure by submitting comments is not sufficient to render that applicant individually concerned by the Decision.
25 The applicants point out that it is DHL Aviation which, on behalf of the Group, submitted comments on 2 April 2007 on the decision to initiate the formal investigation procedure. They claim that DHL Aviation therefore participated in the administrative procedure and thus has an interest of its own in the annulment of the Decision.
Findings of the Court
26 The admissibility of the action in so far as it has been brought by DHL Hub Leipzig – whose capacity to act is not disputed by the Commission – is not in doubt since, as DHL Hub Leipzig is a party to the framework agreement and is covered by the warranties contained in the comfort letter, it is directly and individually concerned by the Decision.
27 In those circumstances, since one and the same application is involved, there is no need to consider the plea of inadmissibility raised by the Commission with regard to DHL Aviation (see, to that effect, Case C‑313/90 CIRFS and Others v Commission [1993] ECR I-1125, paragraphs 30 and 31; Case T‑317/02 FICF and Others v Commission [2004] ECR II-4325, paragraph 40; and Case T‑282/06 Sun Chemical Group and Others v Commission [2007] ECR II-2149, paragraph 50).
Substance
28 Following the partial withdrawal, the applicants rely in essence on a sole plea, alleging that the Commission made a manifest error of assessment in stating that the Nightflight Clause and the 90% Clause had actually been put at the disposal of DHL, and that DHL had therefore benefited from those clauses.
Arguments of the parties
29 The applicants state that, under German civil law, any State aid which is granted without prior notification and/or authorisation by the Commission is void ab initio. The Bundesgerichtshof (Federal Court of Justice, Germany) thus held that, in the context of a contract, the logical consequence of an infringement of the third sentence of Article 88(3) EC is that the contract in question is null and void under Paragraph 134 of the Bürgerliches Gesetzbuch (German Civil Code). A contract which is regarded as null and void under Paragraph 134 of the Bürgerliches Gesetzbuch is treated as having been null and void ab initio and, in consequence, can no longer be enforced. Moreover, the fact that it is null and void is unconditional and irreversible, so that, even if the Commission were subsequently to approve the aid, the contract relating to that aid would remain null and void. The Commission moreover acknowledged the case-law of the Bundesgerichtshof in its draft notice on the enforcement of State aid law by national courts.
30 The applicants therefore maintain that, according to the case-law of the Bundesgerichtshof, the Nightflight Clause and the 90% Clause must be regarded as having been null and void ab initio and as producing no effects. As a consequence, DHL could not have had those clauses enforced before a German court. Accordingly, DHL never actually benefited under those clauses and did not therefore derive any economic advantage that could be recovered. The Decision, in which the Commission ordered recovery of the aid, is therefore ‘unjustified’ and cannot be implemented, since it is objectively impossible to effect such recovery. According to case-law, a Commission decision imposing an obligation which it is objectively impossible to implement is invalid. Article 4 of the Decision should therefore be annulled.
31 The Commission disputes the applicants’ arguments.
Findings of the Court
32 The Commission’s objective in requiring that unlawful aid be recovered is to ensure that the recipient forfeits the advantage which it has enjoyed on the market over its competitors, and that the situation prior to payment of the aid is restored (see, to that effect, Case C‑142/87 Belgium v Commission [1990] ECR I-959, paragraph 66; Case C‑348/93 Commission v Italy [1995] ECR I-673, paragraph 27; and Case C‑75/97 Belgium v Commission [1999] ECR I-671, paragraph 65).
33 In the present case, by Article 4(1) of the Decision, the Commission ordered the recovery of the part of the aid, consisting in accepting liability for the cost of the unlimited warranties contained in the framework agreement, from which DHL had already benefited since it corresponded to the fee that should have been charged in respect of those warranties for the period from 1 October 2007 until the removal of the unlimited warranties. Article 4(2) provides that the amount of the aid to be recovered is to bear interest from the date on which the aid was put at the disposal of the beneficiary until its actual recovery.
34 However, the fact remains that even assuming that, in the German legal order, the Nightflight Clause and the 90% Clause are regarded as null and void ex tunc in accordance with the case-law of the Bundesgerichtshof, as the applicants contend, that would not affect the recovery obligation or the lawfulness of the Decision.
35 In the first place, under the framework agreement, DHL Hub Leipzig benefited – from the date on which operations began at Leipzig-Halle Airport, which under that agreement was 1 October 2007 – from the warranties contained in the Nightflight Clause and the 90% Clause. As is clear from recital 14 of the Decision, FLH was required under the framework agreement to continue to ensure that, after the start of operations at Leipzig-Halle Airport, DHL Hub Leipzig had, in particular, unrestricted air access to that airport 24 hours a day, 7 days a week, and could use the southern runway for at least 90% of its flights. If those terms of operation had not been met, FLH and MF would have been liable under the framework agreement to compensate DHL Hub Leipzig for any damages and any losses which the latter incurred. At the hearing, moreover, the applicants did not deny that they had been able to use Leipzig-Halle Airport in accordance with the terms originally laid down in the framework agreement, even though they stated that this was not through application of the Nightflight Clause and the 90% Clause.
36 In the second place, according to recital 232 of the Decision, the framework agreement does not make express provision for the payment of any consideration for the warranties contained in that agreement, so DHL Hub Leipzig benefited from them free of charge. At the hearing, the applicants acknowledged, moreover, that they did not make any payment for the warranties contained in the framework agreement.
37 It follows that, from 1 October 2007 until the removal of the unlimited warranties contained in the framework agreement, DHL Hub Leipzig enjoyed an advantage over its competitors within the meaning of the case-law referred to in paragraph 32 above, in that, as the Commission has argued, it did not have to pay a fee in order to obtain those warranties. The applicants are therefore wrong in considering that DHL did not derive any economic advantage that could be recovered.
38 In that regard, it should be noted that the applicants confirmed at the hearing that they did not dispute that the Nightflight Clause and the 90% Clause constituted State aid for the purposes of Article 87(1) EC. Categorisation as aid, in the sense of State aid incompatible with the common market, requires in particular that it must confer an advantage on the recipient (Case T‑34/02 Le Levant 001 and Others v Commission [2006] ECR II-267, paragraph 110; see also, to that effect, Case C‑39/94 SFEI and Others [1996] ECR I-3547, paragraph 60; Case C‑256/97 DM Transport [1999] ECR I-3913, paragraph 22; and Joined Cases T‑204/97 and T‑270/97 EPAC v Commission [2000] ECR II-2267, paragraph 66). It follows that, by not disputing the categorisation of the warranties in question as State aid for the purposes of Article 87(1) EC, the applicants accept, at least implicitly, that such measures conferred an advantage on them, since the existence of an advantage is a prerequisite for such categorisation.
39 In those circumstances, in order to comply with the objective – referred to in paragraph 32 above – of the obligation to recover unlawful aid, it was permissible for the Commission to order the recovery of that part of the aid which had been made available to DHL, corresponding to the fee which should have been charged in respect of the warranties in question for the period from 1 October 2007 until they were removed.
40 The fact, relied on by the applicants, that the Nightflight Clause and the 90% Clause were agreed upon in breach of the obligations under Article 88(3) EC and that, that being so, they may, should the case arise, be regarded as null and void ex tunc under German law cannot alter the fact that DHL Hub Leipzig actually received the aid in question, thanks to which it enjoyed an advantage on the market over its competitors. Consequently, and without it being necessary for the Court to rule on the consequences under German law of the unlawfulness of the aid in question, it is clear that that fact can have no effect in this case on the obligation to repay the part of the aid that was put at the disposal of its recipient, given that – as is clear from paragraph 32 above – the objective in recovering unlawful aid is to ensure that the recipient forfeits the advantage on the market which it has enjoyed over its competitors, and that the situation prior to payment of the aid is restored.
41 In that regard, it should be observed that attainment of that objective cannot depend on the consequences under national law of failure to comply with Article 88(3) EC (see, by analogy, with regard to the fact that the form in which the aid was granted has no effect on that objective, Case C‑183/91 Commission v Greece [1993] ECR I-3131, paragraph 16).
42 As regards also the line of argument concerning the alleged impossibility of implementing the Decision, it should be observed that, as the applicants submit, the Commission may not impose, by a decision – which would then be invalid – an obligation whose implementation is, from its inception, impossible in objective and absolute terms (see, to that effect, Case C‑75/97 Belgium v Commission, paragraph 86). However, that is not the case here. Contrary to the assertions made by the applicants, DHL Hub Leipzig actually did – as is apparent from the above – enjoy an advantage on the market over its competitors. In Article 4 of the Decision the Commission ordered the recovery of the aid in question and payment of the related interest. However, there is nothing to suggest that it would have been impossible for the German authorities to implement that obligation. Moreover, it should be noted, for the sake of completeness, that the agreement which the parties reached following the adoption of the Decision shows that it was possible to quantify the aid in question (in this case, as being worth EUR 1 081 439), confirming that it was possible to implement the Decision by recovering that sum. In those circumstances, it cannot be said that implementation of the recovery obligation laid down in the Decision was, from its inception, impossible in objective and absolute terms, which means that the validity of the Decision cannot be affected in that regard.
43 Lastly, it should be stated that both the application of the rules on State aid and the objective of the obligation to recover unlawful aid would be seriously compromised if the applicants’ argument were to be accepted, for that would make it possible for Member States whose domestic law treats measures granting unlawful aid as null and void to grant undertakings the benefit of such aid, while precluding its recovery should the Commission find the aid to be incompatible and order it to be recovered.
44 It follows from all the above that the sole plea, hence the action in its entirety, must be rejected.
Costs
45 Under Article 87(2) of the Court’s Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. As the applicants have been unsuccessful, they must be ordered to pay the costs in accordance with the form of order sought by the Commission.
On those grounds,
THE GENERAL COURT (Eighth Chamber)
hereby:
1. Dismisses the action;
2. Orders DHL Aviation SA/NV and DHL Hub Leipzig GmbH to pay the costs.
Martins Ribeiro | Papasavvas | Dittrich |
Delivered in open court in Luxembourg on 7 October 2010.
[Signatures]