Case T‑462/13

Comunidad Autónoma del País Vasco
and
Itelazpi, SA

v

European Commission

(State aid — Digital television — Aid for the deployment of digital terrestrial television in remote and less urbanised areas in Spain — Decision declaring the aid compatible in part and incompatible in part with the internal market — Advantage — Service of general economic interest — Article 107(3)(c) TFEU — New aid)

Summary — Judgment of the General Court (Fifth Chamber), 26 November 2015

1.      Actions for annulment — Natural or legal persons — Measures of direct and individual concern to them — Decision of the Commission addressed to a Member State finding aid incompatible with the internal market — Action by a regional authority having granted that aid — Admissibility

(Art. 263, fourth para., TFEU)

2.      Actions for annulment — Admissibility criteria — Bringing of a single action by two applicants — Admissibility of the action of one of the applicants — No need to examine the admissibility of the action in relation to the second applicant 

(Art. 263 TFEU)

3.      State aid — Concept — Measures designed to compensate for the cost of public service missions undertaken by an undertaking — First condition set out in the Altmark judgment — Clearly defined public service obligations — No recipient undertaking actually entrusted with the performance of public service obligations — Inclusion in the concept

(Art. 107(1) TFEU)

4.      Competition — Union rules — Addressees — Undertakings — Concept — Exercise of an economic activity — State organ exercising an economic activity and having a legal personality distinct from the latter — Irrelevant to the financial relations between the State and the said organ

(Art. 107(1) TFEU)

5.      Competition — Undertakings entrusted with the operation of services of general economic interest — Broadcasting sector — Determination of services of general economic interest — Distinction between the provision of a broadcasting service and the operation of broadcasting networks — Lawfulness

(Art. 107(1) TFEU; Protocol No 29 annexed to the EU and FEU Treaties)

6.      State aid — Commission decision — Judicial review — Free assessment of the facts and evidence

7.      Competition — Undertakings entrusted with the operation of services of general economic interest — Broadcasting sector — Definition of a network operating service as a service of general economic interest — Condition — Respect for the principle of technological neutrality

(Arts 107(1) TFEU and 108 TFEU)

8.      State aid — Concept — Measures designed to compensate for the cost of public service missions undertaken by an undertaking — Fourth condition set out in the Altmark judgment — Indication of investment cost and recurring expenditure in conventions not sufficient — Service provided by an administration from its own means — Not sufficient to ensure the least cost for the community

(Art. 107(1) TFEU)

9.      State aid — Prohibition — Exceptions — Discretion of the Commission — Judicial review — Limits

(Art. 107(3) TFEU)

10.    State aid — Examination by the Commission — Communication on the switchover to digital broadcasting — Legal nature — Indicative rules of conduct implying a self-limitation on the Commission’s discretion

(Arts 107(3) TFEU and 108 TFEU; Commission Notice COM(2003) 541 final)

11.    State aid — Prohibition — Exceptions — Account taken of the situation existing at the time the measure was adopted

(Art. 107(3) TFEU)

12.    State aid — Prohibition — Exceptions — Aid capable of being regarded as compatible with the internal market — Assessment in the light of Article 107(3)(c) TFEU — Previous practice not to be taken into account

(Art. 107(3)(c) TFEU)

13.    State aid — Examination by the Commission — Consecutive State interventions inseparably linked to each other — Assessment of the measures taken in their entirety — Lawfulness

(Arts 107(3) TFEU and 108 TFEU)

14.    State aid — Existing aid and new aid — Measure amending an existing aid scheme — Modification affecting the substance of the scheme — Classification of the scheme as new aid

(Art. 108(1) TFEU; Council Regulation No 659/1999, Art. 1(c); Commission Regulation No 794/2004, Art. 4(1))

1.      See the text of the decision.

(see para. 34)

2.      See the text of the decision.

(see para. 34)

3.      In State aid matters, according to the first criterion in the Altmark judgment, the undertaking receiving compensation must actually have public service obligations to discharge, and the obligations must be clearly defined.

Whilst Member States have wide discretion to define what they regard as a service of general economic interest (SGEI), that power is not unlimited and cannot be exercised arbitrarily for the sole purpose of removing a particular sector from the application of the competition rules. In order to be classified as an SGEI, the service in question must be of a general economic interest exhibiting special characteristics by comparison with the general economic interest of other economic activities.

In that regard, the scope of the General Court’s review of the Commission’s assessments necessarily takes account of the fact that a Member State’s definition of a service as an SGEI can be questioned by the Commission only in the event of a manifest error. That review must nevertheless ensure respect for certain minimum criteria relating, inter alia, to the presence of an act of the public authority entrusting the operators in question with an SGEI mission, and to the universal and compulsory nature of that mission.

Thus, in the absence of a clear definition of a service as a public service, the first criterion in the Altmark judgment is not satisfied. Moreover, the mere fact that a service is designated in national law as being of general interest does not mean that any operator providing that service is entrusted with performing clearly defined public service obligations within the meaning of the judgment in Altmark. Classification of a service as an SGEI within the meaning of the judgment in Altmark requires that responsibility for its management be entrusted to certain undertakings.

(see paras 42, 50-54, 57)

4.      As regards the application of the competition rules, a distinction must be drawn between a situation where the State acts in the exercise of official authority and that where it carries on economic activities of an industrial or commercial nature by offering goods or services on the market. In that respect, it is of no importance that the State is acting directly through a body forming part of the State administration or by way of a body on which it has conferred special or exclusive rights.

Moreover, the existence or otherwise of legal personality distinct from that of the State, conferred by national law on a body carrying out economic activities, does not prevent the existence of financial relations between the State and that body and, consequently, the possibility that that body will benefit from State aid within the meaning of Article 107(1) TFEU.

(see paras 61, 62)

5.      In State aid law, in the context of review of the classification of a service as being of general economic interest, the Commission is entitled to draw a distinction between the supply of a broadcasting service and the operation of broadcasting networks.

Whilst transmission is indeed indispensable to broadcasting, the broadcasting service must be distinguished from the broadcasting networks operating service. They are two separate activities carried out by different undertakings operating on different markets. While the broadcasting service is supplied by broadcasters, namely television operators, the broadcasting networks operating service is supplied by signal emission platform operators, namely terrestrial, satellite, cable or broadband Internet platforms.

Moreover, whilst Protocol No 29 on the system of public broadcasting in the Member States, supplementing the EU and FEU Treaties, applies to the broadcasting sector and, more specifically, to the financing of the public broadcasting service granted to the broadcasting bodies, the financing of signal emission platform operators is not covered by that protocol. Furthermore, the objectives of the protocol, namely to guarantee the democratic, social and cultural needs of society and to preserve media pluralism, have no connection with the choice of broadcasting technology.

(see paras 65-67, 69, 70)

6.      See the text of the decision.

(see para. 71)

7.      In State aid matters, it follows from the general structure of the Treaty that the procedure provided for in Article 108 TFEU must never achieve a result that would be contrary to the specific provisions of the Treaty. The discretion which Member States enjoy when setting up their SGEIs cannot be exercised in a way that gives rise to a breach of the principle of equal treatment which is ensured, as regards the network operation service, in particular by the principle of technological neutrality.

Thus, where there are several transmission platforms, as in the present case, it is not possible to consider that one of them is essential to the transmission of broadcasting signals, thereby disregarding the principle of technological neutrality. Consequently, in defining a network operating service as an SGEI, the national authorities are not entitled to discriminate against other platforms. A system of undistorted competition, such as that provided for by the FEU Treaty, can be guaranteed only if equality of opportunity is secured as between the various economic operators.

However, respect for the principle of technological neutrality does not mean that in every case defining a particular platform for the operation of the broadcasting networks constitutes a manifest error. Where the Commission does not examine the choice of the Member State in depth, it is not entitled to find the existence of a manifest error by the national authorities in defining a certain platform for the operation of the network. Nevertheless, such a failing is irrelevant in a case where the first criterion of the Altmark judgment is not satisfied in the absence of a clear and precise definition of a broadcasting network operating service as a public service.

(see paras 77-79)

8.      In State aid matters, in order to assess whether the fourth condition set out in the Altmark judgment is satisfied in a particular case, the indication of the investment cost and the recurring expenditure estimated in interinstitutional conventions concluded between the administrations of an autonomous community of a Member State is no substitute for an analysis of the costs which a typical undertaking, well run and adequately equipped to be able to satisfy the necessary public service requirements, would have incurred in performing those obligations, taking account of the associated revenues and also of a reasonable profit for the performance of those obligations.

Moreover, the mere fact that a service is provided by an administration from its own means does not ensure the lowest costs for the community.

(see paras 80, 84, 87)

9.      See the text of the decision.

(see paras 105, 106, 112)

10.    In the matter of the switchover from analogue to digital broadcasting, the importance of the principle of technological neutrality was emphasised by the Commission in paragraph 2.1.3 of the 2003 Switchover Communication. The condition of technological neutrality within the meaning of that communication provides, in particular, that analogue broadcasting in a particular territory can be discontinued only if virtually all households receive digital services and that, in order to achieve that objective, all modes of transmission must be taken into account. Where the Commission adopts such measures which are consistent with the Treaty and are designed to specify the criteria which it intends to apply in the exercise of its discretion, it itself limits that discretion in that it must comply with the indicative rules which it has imposed upon itself.

(see para. 109)

11.    See the text of the decision.

(see paras 116, 119-121, 123, 124)

12.    See the text of the decision.

(see para. 129)

13.    In State aid matters, different State interventions at national, regional and local levels must be analysed by reference to their effects, so that, where those interventions are sufficiently closely linked, they can be regarded by the Commission as a single aid scheme granted by the public authorities of a Member State.

Furthermore, in the case of an aid scheme, the Commission may confine itself to examining the characteristics of the scheme in question in order to determine, in the grounds of its decision, whether the scheme is appropriate for achieving one of the objectives referred to in Article 107(3) TFEU. Thus, in a decision which concerns such a scheme, the Commission is not required to carry out an analysis of the aid granted in individual cases under the scheme. It is only at the stage of recovery of the aid that it is necessary to look at the individual situation of each undertaking concerned.

(see paras 133, 134)

14.    See the text of the decision.

(see paras 146-150)