Action brought on 26 September 2012 - Austria v Commission

(Case T-427/12)

Language of the case: German

Parties

Applicant: Republic of Austria (represented by: C. Pesendorfer, acting as Agent, and by M. Windisch)

Defendant: European Commission

Form of order sought

Annul Article 1(1)(d) in conjunction with Article 1(2) of the European Commission's decision of 25 July 2012 in State aid case SA.28487 (C 16/2009 ex N 254/2009), according to which the funding guarantee given by Austria to Bayerische Landesbank constitutes State aid by the Republic of Austria to Bayerische Landesbank for the purposes of Article 107(1) TFEU and is compatible with the internal market in the light of the commitments set out in Annexes I and III and subject to the conditions set out in Annex II; and

order the defendant to pay the costs.

Pleas in law and main arguments

In support of the action, the applicant relies on five pleas in law.

First plea in law, alleging infringement of the right to a fair hearing

The applicant submits that it was not heard by the defendant prior to the defendant's classification as State aid of the measure implemented by the applicant. The applicant therefore had no opportunity to give an account of the actual legal substance of the agreement and to address subsequent changes in the facts of the situation.

Second plea in law, alleging disregard of the obligation to state reasons under the second paragraph of Article 296 TFEU

The applicant states that the Commission did not give reasons in its decision to justify its classification of the measure at issue as State aid or to explain why that aid is compatible with the internal market. Accordingly it is not possible for those concerned to identify the grounds for the adoption of the legal act, or for the Courts of the European Union to exercise their power of review.

Third plea in law, alleging infringement of Articles 107 TFEU and 108 TFEU

In the applicant's view, the classification of the measure at issue as State aid compatible with the internal market infringes Articles 107 TFEU and 108 TFEU. The applicant explains in that regard that no remuneration at market rates is paid for the measure at issue, nor does it have an impact on financial stability or bank lending in the implementing Member State (in this case Austria), or rather the Republic of Austria cannot exercise appropriate supervision in another Member State in respect of the achievement of any objectives that may have been set.

Fourth plea in law, alleging infringement of Article 125 TFEU

In this context the applicant submits that, under Article 125(1) TFEU, a Member State is not to be liable for or assume the commitments of the central governments, regional or local authorities of another Member State. Since that would, however, be the consequence of the Commission's contested decision, the applicant alleges infringement of Article 125 TFEU.

Fifth plea in law, alleging the defendant's lack of competence

In the applicant's opinion, the Commission is assessing a situation in this case that did not in fact occur in that form. The Commission is thereby exceeding its powers.

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