ORDER OF THE GENERAL COURT (Ninth Chamber)
8 February 2024 (*)
(Arbitration clause – Seventh Framework Programme for research, technological development and demonstration activities (2007-2013) – Enforceable decision – Withdrawal of the contested measure – Action which has become devoid of purpose – No need to adjudicate)
In Case T‑319/23,
Net Technologies Finland Oy, established in Helsinki (Finland), represented by S. Pappas and A. Pappas, lawyers,
applicant,
v
European Commission, represented by E. Garello, M. Ilkova and R. Onozó, acting as Agents,
defendant,
THE GENERAL COURT (Ninth Chamber),
composed of L. Truchot, President, H. Kanninen (Rapporteur) and M. Sampol Pucurull, Judges,
Registrar: V. Di Bucci,
having regard to the order of 3 October 2023, Net Technologies Finland v Commission (T‑319/23 R, not published, EU:T:2023:601),
having regard to the written part of the procedure,
makes the following
Order
1 By its action based on Article 263 TFEU, the applicant, Net Technologies Finland Oy, seeks annulment of Commission Decision C(2023) 2282 final of 27 March 2023 constituting an enforceable decision ordering the recovery of a sum of EUR 188 477.27 together with interest (‘the contested decision’).
Background to the dispute and events subsequent to the bringing of the action
2 The applicant is a limited liability company incorporated under Finnish law whose business activity covers the area of telecommunications (networks design, development, implementation, operation and maintenance).
3 On 30 August 2013, the Grant Agreement FP7SEC2012312484 (‘the grant agreement’) was concluded in the context of the Seventh Framework Programme for research, technological development and demonstration activities (2007-2013) with a view to carrying out the project ‘Inter System Interoperability for Tetra – TetraPol Networks’ (‘the project’) between the consortium’s coordinating company responsible for implementing the project and the European Research Executive Agency (REA). Article 9(3) of the grant agreement lays down an arbitration clause designating the Courts of the European Union.
4 Net Technologies Etaireia Periorismenis Efthynis was one of the members of the consortium responsible for implementing the project. It had signed the grant agreement as a beneficiary. On 1 May 2014, the applicant assumed the rights and obligations of Net Technologies Etaireia Periorismenis Efthynis and thus became a member of the consortium. The grant agreement was amended accordingly. On the same day, the applicant concluded, under the grant agreement, service contracts with five in-house consultants.
5 On 16 March 2018, the REA informed the applicant of the launch of a financial audit concerning its activities in the context of the project. The audit took place from 24 to 26 April 2018. By letter of 11 April 2019, the REA sent the applicant the final audit report in which it considered that the costs of the services of four of the in-house consultants were ineligible under the grant agreement.
6 On 7 May 2020, the REA issued debit note No 3242005825 concerning the reimbursement of the amount of EUR 171 342.97 in respect of an unjustified contribution and debit note No 3242005872 concerning the reimbursement of the amount of EUR 17 134.30 in respect of liquidated damages (‘the debit notes at issue’), corresponding to a total of EUR 188 477.27 together with interest. The deadline for payment was set at 22 June 2020.
7 On 11 June 2020, the applicant brought an action before the Court under Article 272 TFEU (Case T‑358/20). By that action, the applicant sought a declaration from the Court that the costs relating to the in-house consultants, rejected by the REA, constituted eligible costs under the grant agreement and that, consequently, the claims evidenced by the debit notes at issue were unfounded.
8 Since the applicant did not comply with the request for payment of the full amount claimed in the debit notes at issue following several formal notices, on 27 March 2023, the European Commission adopted the contested decision on the basis of Article 299 TFEU.
9 By judgment of 12 July 2023, Net Technologies Finland v REA (T‑358/20, not published, EU:T:2023:388), the Court held that the costs of the in-house consultants, rejected by the REA, constituted eligible costs under the grant agreement and that, consequently, the claims evidenced by the debit notes at issue were unfounded.
Forms of order sought
10 The applicant claims that the Court should:
– declare that there is no longer any need to adjudicate on the action;
– order the Commission to pay the costs, including those incurred in Case T‑319/23 R;
11 The Commission contends that the Court should:
– declare that there is no longer any need to adjudicate on the action;
– order each party to bear its own costs, including those incurred in Case T‑319/23 R.
Law
12 Under Article 130(2) and (7) of the Rules of Procedure of the General Court, on application by a party, the Court may declare that the action has become devoid of purpose and that there is no longer any need to adjudicate on it.
13 In the present case, the Commission has applied for a declaration that the action has become devoid of purpose and that there is no longer any need to adjudicate on it. The applicant has indicated its agreement with the application for a declaration that there is no need to adjudicate. The Court considers that it has sufficient information available to it from the documents in the file and has decided to rule on the Commission’s application without taking further steps in the proceedings.
14 In that regard, it is clear from settled case-law that if, in the context of an action for annulment, the subject matter of the action disappears in the course of the proceedings, the Court cannot rule on the substance, since such a decision on its part cannot procure any advantage for the applicant. The disappearance of the subject matter of the proceedings can inter alia result from the withdrawal or replacement of the contested act in the course of the proceedings (see order of 12 January 2011, Terezakis v Commission, T‑411/09, EU:T:2011:4, paragraphs 14 and 15 and the case-law cited).
15 Further, according to settled case-law, the withdrawal or, in certain circumstances, the repeal, of the contested act by the defendant institution deprives the action for annulment of its purpose, since it leads, for the applicant, to the desired outcome and gives him or her full satisfaction (see order of 28 March 2006, Mediocurso v Commission, T‑451/04, not published, EU:T:2006:95, paragraph 26 and the case-law cited; orders of 19 May 2011, Dagher v Council, T‑218/11 R, not published, EU:T:2011:231, paragraph 27, and of 6 July 2011, Petroci v Council, T‑160/11, not published, EU:T:2011:334, paragraph 15).
16 In the present case, by Decision C(2023) 5003 final of 19 July 2023, the Commission withdrew the contested decision given that, following the delivery of the judgment of 12 July 2023, Net Technologies Finland v REA (T‑358/20, not published, EU:T:2023:388), that decision had become unfounded. Consequently, the Commission withdrew the contested decision after 8 June 2023, the date on which the application was lodged, thus eliminating the subject matter of the proceedings pending before the Court.
17 It follows from all of the foregoing that there is no longer any need to adjudicate on the present action.
Costs
18 According to Article 137 of the Rules of Procedure, where a case does not proceed to judgment, the costs are to be in the discretion of the Court.
19 In the present case, the Commission adopted the decision withdrawing the contested decision after, first, the bringing of the present action, second, the lodging of the application for interim measures relating thereto on 4 July 2023 and, third, the event giving rise to that withdrawal decision, namely the judgment of 12 July 2023, Net Technologies Finland v REA (T‑358/20, not published, EU:T:2023:388). Consequently, both the bringing of the present action and the related application for interim measures and the reason for the finding that there is no need to adjudicate may be regarded as having their origin in the conduct of the Commission.
20 In those circumstances, the Commission must be ordered to bear its own costs and to pay those incurred by the applicant. In addition, since the order of 3 October 2023, Net Technologies Finland v Commission (T‑319/23 R, not published, EU:T:2023:601), reserved the costs relating to the proceedings for interim measures, the Commission must also be ordered to bear its own costs and to pay those incurred by the applicant in the context of those proceedings for interim measures.
On those grounds,
THE GENERAL COURT (Ninth Chamber)
hereby orders:
1. There is no longer any need to adjudicate on the action.
2. The European Commission is ordered to bear its own costs and to pay the costs incurred by Net Technologies Finland Oy, including those relating to the proceedings for interim measures.
Luxembourg, 8 February 2024.