The Court has found that increased reductions in social security contributions for certain undertakings having the sole aim of granting them a competitive advantage but which are not justified by the scheme of the general social security scheme constitute State aid prohibited by Community law.
The Maribel scheme, introduced by the Belgian Law of 29 June 1981, laying down the general principles of social security for wage earners, provided that employers employing manual workers were to receive, for each one of them, a reduction in social security contributions. A Royal Decree of 14 June 1993 essentially increased the reduction in social security contributions if the employer carried on his principal activity in one of the sectors most exposed to international competition.
To that "increased reduction" the Royal Decree of 22 February 1994 added a new increased reduction in social security contributions, as from 1 January 1994, for undertakings carrying on their activity in one of the sectors most exposed to international competition and also extended the Maribel scheme to certain international transport activities. The scope of the Maribel ter scheme was further extended from 1 July 1994 to horticulture, forestry and exploitation of forests.
By decision of 4 December 1996, the Commission found that the increased reductions constituted State aid incompatible with the common market. It also directed Belgium to recover from the recipient undertakings the aid unlawfully paid.
Belgium argued that the Maribel bis/ter scheme constituted a general measure of economic policy and challenged the Commission decision before the Court of Justice.
The Court found that the reductions in social charges granted under the Maribel bis/ter scheme constituted a financial advantage in the nature of aid and that the aid was selective in that it was limited to certain sectors of economic activity. They therefore fulfilled one of the characteristics of State aid. The Court did not accept the Belgium Government's argument that temporary budgetary difficulties prevented the advantages granted from being extended to all economic sectors.
The Court, whilst accepting that the organisation of the Member States' social security systems lay within the competence of the Member States, emphasised that the Maribel bis/ter scheme could not be justified by the nature or the scheme of the Belgium social security system but had the sole direct effect of granting an economic advantage to the recipient undertakings.
The Court observed that the increased reductions were granted unconditionally without any direct social or economic compensatory payment on the part of the recipient undertakings, and were not therefore linked to either the creation of jobs in small and medium-sized enterprises or to the hiring of certain groups of workers experiencing particular difficulties entering or re-entering the labour market.
As regards the obligation to recover the aid improperly granted, the Court held that the Commission had not infringed the principle of proportionality in requiring the aid to be recovered since such a requirement is the logical consequence of a finding that the aid is unlawful. The Court recognised that recovery involved administrative and practical difficulties owing to the large number of undertakings involved but considered that Belgium is not faced with any absolute impossibility of carrying out the obligation to recover the aid in question.
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