Action brought on 14 March 2011 - Carbunión v Council

(Case T-176/11)

Language of the case: English

Parties

Applicant: Federación Nacional de Empresarios de Minas de Carbón (Carbunión) (Madrid, Spain) (represented by: K. Desai, Solicitor, S. Cisnal de Ugarte and M. Peristeraki, lawyers)

Defendant: Council of the European Union

Form of order sought

declare the action for annulment admissible;

declare the action for annulment founded and accordingly annul Article 3(1) indents (a) (b) and (f); and Article 3(3) of the Council Decision of 10 December 2010 on State aid to facilitate the closure of uncompetitive coal mines (2010/787/EU)¹; and

condemn the Council to bear the costs incurred by the applicant in relation to these proceedings.

Pleas in law and main arguments

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

1.    First plea in law, alleging manifest errors in the appreciation of the relevant acts since the defendant based the contested decision on the following findings:

the contribution of coal in the EU energy supply is small;

the closure of the uncompetitive mines and elimination of the EU coal production will encourage renewable energy sources;

the coal production in the EU and in Spain in particular are by no means expected to become competitive by 2018.

2.    Second plea in law, alleging lack of statement of reasons since the Council failed to:

address the abundant evidence and conclusions that were presented to it during the preparatory procedure by other institutions and stakeholders demonstrating the importance of the EU coal industry for the security of supply in the EU;

state reasons for (i) departing from the State aid framework and policy instituted with the 2002 Coal Regulation², which was based on security of supply concerns, and (ii) instead adopting the contested decision based solely on competitiveness' considerations.

3.    Third plea in law, alleging breach of the principles of legal certainty and legitimate expectations since the contested decision:

constitutes an abrupt and unexpected change of the position of the EU towards the indigenous coal sector in the EU and in Spain in particular;

violates the principle of legitimate expectations as it does not provide for a transitional period to allow the applicant to adapt to this significant change of policy.

4.    Fourth plea in law, alleging breach of the principle of proportionality as the contested decision imposes unjustified and excessive restrictions to the operation of the indigenous coal mines in Spain, which do not correspond to the Council's objectives. More precisely, in the applicant's view, the measures adopted by the contested decision do not address the environmental concerns put forward by the Council, since the EU electricity plants will continue to "burn" imported coal. In fact the contested decision imposes overly burdensome obligations on the applicant which are totally unrelated to the objective of environmental protection. Furthermore, the applicant submits that competition concerns arising from the subsidisation of the indigenous coal are also exaggerated in the contested decision.

5.     Fifth plea in law, alleging misuse of powers. In this regard the applicant submits that the measures adopted in the contested decision, given their adverse effects for the coal mining sector in the EU, do not correspond to the strategic goals and the policy objectives that the EU is meant to pursue under Article 194 TFEU. The contested decision endangers the proper functioning of the energy market in the EU and the security of energy supply in the EU and in Spain in particular. Therefore, the Council misused its powers in adopting the contested decision which aims at eliminating one of the most important indigenous raw materials for securing energy supply in the EU.

6.    Sixth plea in law, alleging breach of the principles of equal treatment and non discrimination. In the applicant's view, the contested decision discriminates against indigenous coal producers (i) vis-à-vis importers of coal in the EU and (ii) vis-à-vis other forms of energy respectively.

7.    Seventh plea in law, alleging that the contested decision is founded on the wrong legal basis. The applicant submits that the contested decision is adopted on the basis of Article 107(3)(e) TFEU alone when it should have also been adopted on the basis of Article 109 TFEU and follow the corresponding procedure.

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¹ - OJ 2010 L 336, p. 24

² - Council Regulation (EC) No 1407/2002 of 23 July 2002 on State aid to the coal industry, OJ 2002 L 205, p. 1