Action brought on 14 March 2012 - Viasat Broadcasting UK v Commission

(Case T-125/12)

Language of the case: English

Parties

Applicant: Viasat Broadcasting UK Ltd (West Drayton, Middlesex, United Kingdom) (represented by: S. Kalsmose-Hjelmborg and M. Honoré, lawyers)

Defendant: European Commission

Form of order sought

Annul the decision of the European Commission of 20 April 2011 in Case C 2/03 on the measures implemented by Denmark for TV2/Danmark (Decision 2011/839/EU) (OJ 2011 L 340, p. 1);

Order the Commission to pay the costs.

Pleas in law and main arguments

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

First plea in law, alleging that the defendant erred in law when it carried out the compatibility test under Article 106(2) TFEU since it failed to draw the necessary consequences from the finding that the public service compensation to TV 2 had been granted in violation of the second and of the fourth Altmark conditions (Case C-280/00 Altmark Trans and Regierungspräsidium Magdeburg, ECR [2003] 7747).

As regards the interrelation between the second Altmark condition and Article 106(2) TFEU, the applicant maintains that :

-    the transparency requirements stated in the second Altmark condition are also inherent in the test carried out by the defendant under Article 106(2) TFEU;

-    the defendant already requires compliance with other purely formal requirements in order for Article 106(2) TFEU to be complied with;

-    Article 106(2) TFEU already contains a requirement of transparency and the presence of certain structural safeguards;

-    the second Altmark condition is already reflected in various Commission Communications and Decisions concerning the applicability of Article 106(2) TFEU - also in the field of public service broadcasting; and

-    there is no convincing reason why the defendant should not, in the present case, take into account its own interpretation of Article 106(2) TFEU in its various Communications and Decisions, in particular when the Commission's interpretation is derived from developments in case law.

As regards the interrelation between the fourth Altmark condition and Article 106(2) TFEU, the applicant maintains that:

-    it would have detrimental consequences to competition in the market not to consider the efficiency of the public service broadcaster for the purpose of applying Article 106(2) TFEU in the absence of a public tender;

-    the harm to competition would be particularly significant in the broadcasting sector since all costs incurred by a public service operator may be characterised as additional public service costs that may be compensated by the Member State, and where there is no obligation to examine if the costs result from inefficient management or from the public service obligation;

-    public service compensation may therefore be used as de facto rescue aid or operating aid, allowing a failing firm to continue its operations instead of being restructured or eliminated;

-    an efficiency test does not make Article 106(2) TFEU a "dead letter" since the Commission may, depending on the characteristics of the case, approve compensation which exceeds the costs of an average, well-run undertaking; and

-    the aim of Article 106(2) TFEU, as interpreted in the light of the Amsterdam Protocol, is not to shield a particular public service broadcaster from the rules of competition but to protect the freedom of Member States in defining public service missions and to ensure that the citizens receive public services at the least cost to society.

Second plea in law, alleging that the defendant violated Article 296 TFEU since it failed to state the reasons for approving the aid under Article 106(2) TFEU when the second and the fourth Altmark conditions were not observed.

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