Notice for the OJ

 

Action brought on 2 June 2003 by ASM Brescia S.p.A. against Commission of the European Communities

    (Case T-189/03)

    (Language of the case: Italian)

An action against the Commission of the European Communities was brought before the Court of First Instance of the European Communities on 2 June 2003 by ASM Brescia S.p.A., represented by Fausto Capelli, Francesca Vitale and Massimiliano Valcada, lawyers.

The applicant claims that the Court should:

(in substance, annul Article 2 of Commission Decision 2003/193/EC of 5 June 2002, published in OJ 2003 L 77, by which the European Commission declared incompatible with the common market the measures adopted by the Italian Republic under Article 2(70) of Law No 549 of 28 December 1995 and Article 66(14) of Decree Law No 331 of 30 August 1993, converted into Law No 427 of 29 October 1993 granting exemption from income tax to joint stock companies with majority public shareholdings set up in accordance with Law No 142 of 8 June 1990;

(in substance, in the alternative, annul Article 3 of Commission Decision 2003/193/EC of 5 June 2002, published in OJ 2003 L 11, by which the European Commission ordered the Italian Republic to recover granted to, inter alios, the applicant;

(order the European Commission to pay the costs.

Pleas in law and main arguments

The applicant in the present action, the former azienda municipalizzata (municipal undertaking) of Brescia is contesting the decision of the Commission of 5 June 2002, ¹ in which it considered State aid the three-year exemption (1997 to 1999) from income tax, provided for by Italian legislation for former municipal undertakings which became companies with a majority public shareholding and accordingly ordered recovery of the appropriate amounts.

In support of its claims, the applicant alleges the following:

(in the contested decision, the defendant appears to have conducted its analysis while completely disregarding the special nature of the public utilities sector, namely that it ensures public provision of certain minimum services deemed to be of fundamental importance.

(The contested decision does not take account of the fact that, in the years concerned, in the public utilities sector there were a number of de jure and de facto monopolies such as to exclude a market open to competition. The Commission merely assumed, without putting forward any evidence, the presence of an open competitive market. In that regard, the Court should find that the Commission has failed to provide adequate reasons inasmuch as it has found competition to have been infringed on a single ground: the alleged damage suffered by those undertakings which are not beneficiaries of the measures provided for by the legislation in question in the event that they should compete with the beneficiary undertakings for the same contracts.

(Since the inquiry was opened only in so far as concerned exclusively the local public utilities market where it was assumed that there was open competition, the final decision could not assess the impact of the measures on other markets which were not concerned by the decision to initiate the procedure. Finally, the measures in question cannot be deemed incompatible with the common market in so far as those undertakings could, in theory, have operated in a market other than that of local public utilities, which is the only one under formal investigation.

(The provision which limits the "tax moratorium" to only three years does not introduce any new State aid, rather it merely amends a tax regime which has been applicable to a defined category of taxpayer since 1925.

(Should the Court find that this is a case of State aid, it should, pursuant to Article 87(3)(c) of the Treaty, be declared compatible with the common market inasmuch as the measures are inherent in the nature and/or general structure of the system in question. Indeed, a change in the general system of local public utilities could not have been successfully carried out if the undertakings which had to become companies with a majority public shareholding had not been afforded the chance to become gradually acquainted with the mechanisms which govern private law.

In its application, the applicant also alleges infringement of Article 86(2) of the Treaty inasmuch as it was held in the decision that that provision did not apply to the measures in question.

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¹ - (Commission Decision 2003/193/EC of 5 June 2002 on State aid granted by Italy in the form of tax exemptions and subsidised loans to public utilities with a majority public capital holding(OJ 2003 L 77, p. 21)