Action brought on 7 June 2007 - Eurallumina v Commission

(Case T-207/07)

Language of the case: English

Parties

Applicant: Eurallumina SpA (Portoscuso, Italy) (represented by: L. Martin Alegi, R. Denton and E. Cormack, Solicitors)

Defendant: Commission of the European Communities

Form of order sought

Either:

annul the entirety of the contested decision; or

order that the present exemption authorised by Council Decision 2001/224/EEC is lawful until 31 December 2006 and that any sums foregone by the Italian State should not be considered as unlawful State aid, or at least not be recovered; or

annul the entirety of the contested decision and order that the present exemption authorised by Council Decision 2001/224/EEC is lawful until 31 December 2006 and that any sums foregone by the Italian State should not be considered as unlawful State aid, or at least not be recovered; or

order that a maximum of 3 EUR per tonne should be recovered.

Either:

annul Articles 1, 4, 5 and 6 of the contested decision insofar as they pertain to Eurallumina; or

order that the present exemption authorised by Council Decision 2001/224/EEC is lawful until 31 December 2006 and that any sums foregone by the Italian State should not be considered unlawful State aid, or at least not be recovered; or

annul Articles 1, 4, 5 and 6 of the contested decision insofar as they pertain to Eurallumina and order that the present exemption authorised by Council Decision 2001/224/EEC is lawful until 31 December 2006 and that any sums foregone by the Italian State should not be considered as unlawful State aid, or at least not be recovered; or

order that a maximum of 3 EUR per tonne should be recovered.

In the alternative, modify Articles 5 and 6 of the contested decision insofar as they pertain to Eurallumina to the effect that pursuant to the present exemption until 31 December 2006, any sums foregone by the Italian State should not be recovered; and

order that the Commission pay all of the costs of the proceedings.

Pleas in law and main arguments

The applicant seeks the annulment of Commission Decision C(2007) 286 final of 7 February 2007 by which the Commission found that the exemptions from excise duty granted by France, Ireland and Italy in respect of heavy fuel oils used in the production of alumina as from 1 January 2004 constituted State aid within the meaning of Article 87(1) EC and that a certain part of this aid was incompatible with the common market.

In support of its application, the applicant submits that the continuation of the exemption from excise duty on mineral oils used as fuel for alumina production in Sardinia also after the entry into force of Council Directive 2003/96/EC¹ on 1 January 2004 does not constitute State aid, as Article 18(1) of the directive and Annex II hereto expressly state that this exemption, which was approved by Council Decision 2001/224/EC², continues until 31 December 2006. According to the applicant, Directive 2003/96/EC thus expressly revalidates the specific exemption from excise duty granted to the applicant until 31 December 2006.

Furthermore, the applicant alleges that even though the exemption approved by Council Decision 2001/224/EC is a selective measure at first sight, it is justified by the 'overall nature and logic' of both the Community rules and the Italian tax system, and thus is not State aid.

Moreover, the applicant submits that even if the exemption approved by Council Decision 2001/224/EC is to be considered State aid, it qualifies for an exemption from the prohibition of Article 87(1) EC under the rules for environmental aid³.

Finally, the applicant contends that the Commission breached the principles of legitimate expectations, legal certainty, presumption of validity, lex specialis, effet utile and good administration by finding that the application of the exemption from excise duty on mineral oils used for alumina production in, among others, Sardinia was a State aid recoverable from 1 January 2004, as the applicant had the right to expect that the exemption approved by Council Decision 2001/224/EC until 31 December 2006 was a legally valid Community act and that any measure taken by the Italian authorities and the applicant to implement and rely on this decision would not lead to an unlawful result.

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¹ - Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of energy products and electricity (OJ 2003 L 283, p. 51).

² - Council Decision 2001/224/EC of 12 March 2001 concerning reduced rates of excise duty and exemptions from such duty on certain mineral oils when used for specific purposes (OJ 2001 L 84, p. 23).

³ - Community guidelines on State aid for environmental protection (OJ 2001 C 37, p. 3), in particular paragraph 51(1)(a) and (b).